What the law says with Ayaba Ntreh … Ensuring fair competition among local traders: the role of Ghana International Trade Commission

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Are you a trader? Are you facing issues of unfair competition, especially from foreign competitors? Are you aware that there is an avenue to lay bare all your grievances and get them solved, or at least remedied? Well, that and many more, are the reasons the Ghana International Trade Commission was set up.

Trade is simply defined by the Black’s Law Dictionary as the business of buying and selling or bartering goods or services. As simple and easy as it may sound, trade is arguably one of the main stalwarts of every economy.

According to a report published by Trading Economics, trade percentage of GDP in Ghana was reported at 71.68% in 2018. According to them the information was sourced from the World Bank’s collection of development indicators, compiled from officially recognized sources. Again, the African Development Bank in its 2019 Ghana Economic Outlook published on its website that Ghana’s economy continued to expand in 2019, with real GDP growth estimated at 7.1%.

The report further indicated that high growth momentum since 2017 had consistently placed Ghana among Africa’s 10 fastest-growing economies. Improvements in the macroeconomic environment were accompanied by expansion in domestic demand due to increased private consumption. The industrial sector, with average annual growth exceeding 10%, was a major driver of growth in the three years to 2019.

The report also stated that with the African Continental Free Trade Agreement, Ghana’s industry would grip growing raw materials from the region, expand manufacturing, and trade in processed and light manufactured products.  The importance of trade to an economy requires therefore that there is an independent body to regulate such trade activities. In the ensuing discussion, the objects and functions of the Ghana International Trade Commission (GITCP) would be showcased.

The objects and functions of the Ghana International Trade Commission

Increase in trade, may in no doubt result in an increase in the malpractices associated with trade, which includes unnecessary monopolization as well as unhealthy competitions. Other types of malpractices may be attributable to trademark and patent issues as well as restraint of trade. It may also include issues regarding passing off, interference with contractual relations, conspiracy, intimidation, causing loss by unlawful means as well as injurious falsehood, which may give rise to an action in tort.

Section 2 of the Ghana International Trade Commission Act, 2016 (Act 926) highlights the objects of the GITC. These objects are to oversee the compliance of Ghana with international trade rules and regulations, ensure fairness, efficiency, transparency and objectivity in the application of measures affecting international trade and the use of world trade measures, ensure fair competition for persons engaged in domestic production and international trade and to protect the domestic market from the impact of unfair trade practices in the course of international trade.

The Act provides that, in furtherance of the objects as have been mentioned, the Commission shall be guided by the treaty provisions of the World Trade Organization and general principles of international trade law.

In order to achieve the objects as set out in the Act, certain functions have been outlined and for the purposes of this piece, one of the functions of the Commission is to enquire into and determine complaints brought before the Commission in relation to safeguard measures, the subsidization of imported products by foreign governments, the dumping of imported products into the domestic market, tariff adjustments and any other measure which affects fair trade determined by the Minister.

One other important role of the Commission is to settle disputes between importers and the Customs Division of the Ghana Revenue Authority in respect of the classification and valuation of products that are imported.

Again, in furtherance of its objects, the Commission may impose special import measures such as safeguard measures, anti-dumping duties, countervailing duties and tariff adjustment measures

What constitutes unfair trade practices?

Unfair trade practice is an equitable business practice; especially, the act or an instance of a competitor’s repeating of words in a way that conveys a misrepresentation that materially injures the person who first used the words, by appropriating credit of some kind earned by the first user.

Unfair trade practice is also defined by the Merriam-Webster Dictionary as any of various deceptive, fraudulent, or otherwise injurious (as to a consumer) practices or acts that are declared unlawful by statute or recognized as actionable at common law.

In Ghana, Act 926 also defines unfair trade practice as a business practice that distorts trade and gives an unfair advantage to an enterprise in the market place. Unfair trading practices may include but not limited to trademark and patent issues as well as restraint of trade. It may also include issues regarding passing off, interference with contractual relations, conspiracy, intimidation, causing loss by unlawful means as well as injurious falsehood, which together make up economic torts.

What role does the GITC play in eliminating unfair trade practices and ensuring fair competition?

In ensuring the elimination of unfair trade practices, Act 926 mandates the GITC to make recommendations to the Minister in charge of trade for the imposition of safeguard measures, and tariff adjustments. It appears from the provisions of the Act, particularly section 22 that the GITC is also empowered in its own right, to impose certain special import measures, mainly anti-dumping duties and countervailing duties, apart from the recommendations it may make to the minister.

The imposition of anti-dumping or countervailing duties as envisaged under section 22 of the Act 926, may be triggered on receipt of a written complaint filed by a domestic producer or his representative, that produces products that are similar or directly competitive with the products that are subject of the complaint. However, it is important to state that there are situations in which the imposition of these duties are ignited by the GITC’s own initiative where it has sufficient evidence to justify the said imposition.

Ordinarily, the Minister in charge of trade may impose a safeguard measure or tariff adjustment measure on the recommendation of the GITC, where the GITC receives a written complaint filed by a domestic producer or his representative, that produces products that are similar or directly competitive with the products that are the subject of the complaint, or on its own initiative has sufficient evidence to justify the imposition of those measures.

Before making a recommendation to the Minister for the imposition of special import measures, or exercising its power under the GITC Act to impose anti-dumping or countervailing duties, the Commission is obliged by law to first carry out an investigation and in the conduct of such investigation, full opportunity ought to be afforded all the interested parties to defend their interests.

In furtherance of the power to make special import impositions, the GITC has the power to suspend or terminate an investigation initiated for the purpose of imposing a special import measure, impose provisional measures, including anti-dumping and countervailing duties and reviewing its own findings and determination relating to the special import measure. These special import measures would be discussed at length in the next few paragraphs.

Recommendation for the imposition of safeguard measures

Safeguard measures would be imposed where products are imported into the country in increased quantities in absolute or relative terms to domestic production, and where conditions exist as to cause serious injury or threaten to cause serious injury to a domestic producer of like or directly competitive products.

These measures would be imposed on an imported product regardless of its source and despite the fact that Ghana may have ratified a free trade agreement or economic partnership agreement with a country with a substantial supply interest in the product under investigation.

Despite the power of the Minister to make such impositions, he may impose a provisional safeguard measure in the form of a tariff increase for a period of not more than two hundred days, if he is convinced that a delay in the imposition of a safeguard measure will result in irreparable damage to a domestic producer or the domestic industry and such imposition will be in the public interest.

As has already been indicated, it is expedient for the Commission to conduct investigations before making a recommendation and for the purposes of carrying out the said investigation, the Commission has to notify interested parties by publishing a notice of the investigation in the Gazette and conducting a public hearing to provide the interested parties the opportunity to register their views and present evidence on the imposition of the safeguard measures.

On the conclusion of the investigation, the Commission would then publish a report of its findings and reasoned conclusions reached on issues of fact and law in the Gazette. The duration for the imposition shall be determined by the required to prevent or remedy serious injury and facilitate the adjustment of a domestic producer or domestic industry which may have been affected by the importation of the product. The period however ought not to exceed a period of ten years from the date of the imposition.

The Minister in charge of trade, on the recommendation of the Commission is obliged to notify the Committee of Safeguards of the World Trade Organisation on the various of investigations relating to serious injury or a threat of serious.

Imposition of countervailing and anti-dumping duties

Where there is a subsidization allegation, material injury caused and a causal link between the product that is subsidized and material injury, the GITC may upon the complaint of a domestic producer or industry or on its own initiative, after religiously conducting investigations in accordance with the law, impose a counter vailing duty upon satisfaction that the allegation has been substantially proved. The purpose of such an imposition of countervailing duty is to counteract the subsidisation which is the cause of the material injury.

Similarly, where the GITC determines that a product has been dumped because the price of the product is less than its normal value in the exporting country and as such is causing material injury to a domestic producer or industry producing like or directly competitive product or is likely to retard the establishment of a domestic industry. The circumstances in which the dumping would cause injury ought to be reasonably foreseeable and imminent before the Commission can impose such duty upon satisfying the investigation requirements under the law.

It is important to note that the duration of both a countervailing duty and an anti-dumping duty ought not to exceed a period of five years.

Powers of the commission to entertain tariff petitions

The law mandates the Commission to investigate and make a determination regarding petitions that are brought by domestic producers or review before them for the review of tariffs that affects the production and competitiveness of goods in relation to the said producer or industry.

The Commission can also entertain a petition for the grant of a customs duty rebate or drawback so as to enhance its competitiveness. Such petitions ought to relate only to products that imported and are either like or directly competitive or substitutable to the products produced by the applicant; or that are used by the applicant as inputs for the production of other products.

After going through the necessary and required processes, and after evaluating the petition, the Commission may approve or reject the petition and provide a report which sets out the basis for such a decision and the petitioner shall be informed of the decision within a period not exceeding fourteen working days.

Power of the commission to settle disputes regarding valuations by the Customs Division of the of the Ghana Revenue authority. The GITC is ordained by the law to settle disputes which may arise as a result of a valuation by the Customs Division of the Ghana Revenue Authority.

Such power to settle disputes may be invoked by an importer or a representative of an importer of goods which is the subject matter of a valuation, by lodging a written complaint with the GITC. Such a complaint would usually be deemed as an initial appeal against the final determination of a dutiable value of the goods in question.  The Commissioner-General who wishes to contest the claimed contained in the complaint of the importer shall file a response within fourteen working days of receipt of the complaint.

Such settlement is required to take the form of a mediation, arbitration or a hearing before the Commission and in making a determination, the Commission is obliged to consider the laws in force.

Before making a final determination, the Commission is at liberty to make some interim orders regarding the clearance of the goods, posting of a bond by the importer, placement of products in a bonded warehouse pending the determination of the value of the products; the production of documents regarding the importation of the products and any other interim order.

Having heard the complaint, the Commission is enjoined by law to make a decision within fourteen working days of receipt of the complaint lodged and for the purpose of correcting an obvious error or omission, vary or rescind its decision on its own initiative or an application by the importer or his authorised representative or the Commissioner-General. The notice of the decision of the Commission shall be published in the Gazette.

Furthermore, where a person is dissatisfied with a decision of the Commission, that person may apply for a judicial review of the final decision, recommendation, order or ruling of the Commission in accordance with the High Court (Civil Procedure) Rules, 2004 (C.I. 47). Such an application has to be made within six months of the date of the decision, determination, recommendation, order or ruling.

Where a person affected by the decision of the Commission does not comply with such decision, the Commission may make an application to the High Court for an order to compel a person to comply with the decision.

Conclusion

All the activities of the Commission as have been highlighted above are conducted for the purpose of ensuring a healthy competition among local traders while curtailing unfair trade practices in the country. This would enhance trading in the country and eventually boost the economy.

Reference: The Black’s Law Dictionary, 8th Edition at page 4748

 >>>the writer is a lawyer. email: [email protected] Tel: 0209044925 or 0248732413

 

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