FEDERAL COURT OF AUSTRALIA N.V. Beaulieu Real v The Minister for Justice & Customs [2002] FCA 467 CUSTOMS – complaint made by sole Australian manufacturer of carpet backing fabric as to 'dumping' on Australian domestic market by overseas exporters (including Belgium exporter) of carpet backing fabric – loss of profitability though not loss of sale transactions by sole Australian manufacturer found by Customs to be caused by export price of 'dumped' products on Australian market – decision of Minister to invoke powers under s 269TG of Customs Act - Minister declared exported carpet backing fabric to Australia liable to dumping duty - overseas exporters challenge Ministerial decisions for want of causal link between 'dumping' and loss of profitability of Australian manufacturer. ADMINISTRATIVE LAW – whether decision of Minister vitiated under ADJR Act on basis of errors of law within ss 5(1)(e), in combination with ss 5(2)(a) and (b) or 5(2)(g) – or within s 5(1)(f) – or within s 5(1)(h) in combination with s 5(2)(a) and (b). Customs Act 1901 (Cth) ss 260TAB, 269TAC, 269TAE, 269TE, 269TEA, 269TG, 269ZZK, 269ZZL, subs 229A(2) Administrative Decisions (Judicial Review) Act 1977 (Cth) ss 5(1)(e), 5(1)(h), 5(2)(a), 5(2)(b), 5(2)(g), 5(3)(a) and 5(3)(b) Customs Tariff (Anti-Dumping) Act 1995 (Cth) subs 8(5) Aronson et al Judicial Review of Administrative Action 2nd ed 2000 at Chapter 6 Vickers v Minister for Business and Consumer Affairs (1982) 43 ALR 389 referred to Kanbur Pty Ltd v Adams (1994) 55 ALR 158 referred to Kimberly-Clark Ltd v Commissioner of Patents (1988) 84 ALR 685 referred to Australian Broadcasting Tribunal v Bond (1990) 170 CLR 321 applied Minister of State for Immigration, Local Government And Ethnic Affairs v Pashmforoosh (1989) 18 ALD 77 referred to Detsongjarus v Minister for Immigration, Local Government and Ethnic Affairs (1990) 21 ALD 139 referred to Enichem Anic Srl v Anti-Dumping Authority (1992) 39 FCR 458 applied Feltrex Reidrubber Ltd v Minister for Industry and Commerce (1983) 67 FLR 32 cited Swan Portland Cement Ltd v Minister for Small Business and Customs (1991) 28 FCR 135 applied Mullins Wheels Pty Ltd v Minister for Customs and Consumer Affairs (199) 166 ALR 449 applied Minister for Aboriginal Affairs v Peko-Wallsend Ltd (1986) 162 CLR 24 cited Minister for Immigration and Multicultural Affairs v Yusuf (2001) 180 ALR 1 cited Mendoza v Minister for Immigration, Local Government and Ethnic Affairs (1991) 31 FCR 405 cited Bennett v Minister of Community Welfare (1992) 176 CLR 408 referred to Minister for Immigration and Multicultural Affairs v Eshetu (1999) 197 CLR 611 followed Puhlhofer v Hillingdon London Borough Council [1986] AC 484 approved N.V. BEAULIEU REAL v THE MINISTER FOR JUSTICE & CUSTOMS Q 233 of 1999 CONTI J 16 APRIL 2002 SYDNEY IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY Q 233 OF 1999 BETWEEN: N.V. BEAULIEU REAL APPLICANT AND: THE MINISTER FOR JUSTICE & CUSTOMS RESPONDENT JUDGE: CONTI J DATE OF ORDER: 16 APRIL 2002 WHERE MADE: SYDNEY THE COURT ORDERS THAT: 1. The Application be dismissed. 2. Applicant to provide within 14 days any written submission as to why an order as to costs should not follow the event. 3. Either party to have liberty to apply on 7 days' notice on the issue of costs. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules. IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY Q 233 OF 1999 BETWEEN: N.V. BEAULIEU REAL APPLICANT AND: THE MINISTER FOR JUSTICE & CUSTOMS RESPONDENT JUDGE: CONTI J DATE: 16 APRIL 2002 PLACE: SYDNEY REASONS FOR JUDGMENT The industry background and the genesis of the dispute 1 Polyweave Real N V ("Polyweave") is an exporter from Belgium to Australia of woven polypropylene primary carpet backing fabric ("carpet backing fabric") marketed by the label Polyweave. It has been identified corporately with the Applicant in the conduct of the proceedings. Amoco Chemicals Pty Limited ("Amoco") is the only manufacturer in Australia of carpet backing fabric for both export and domestic sales, the carpet backing fabric being wholly produced at its Liverpool plant in the State of New South Wales. Carpet backing fabric forms part of the base upon which tufted carpets are created, and accordingly carpet manufacturers are the major outlet for the supply of carpet backing fabric. Hence Polyweave and Amoco are in competition in Australia for the supply of carpet backing fabric. Amoco is an Australian subsidiary of a parent established in the United States of America. The Australian Customs Service ("ACS") is the Commonwealth agency responsible for anti-dumping and counter-veiling investigations undertaken under the Customs Act 1901 (Cth) ("the Act"). By subs 269TG(1) of the Act, the Minister is empowered to impose anti-dumping measures in relation to goods that have been exported to Australia, in circumstances: "…where the Minister is satisfied, as to any goods that have been exported to Australia, that: (a) the amount of the export price of the goods is less than the amount of the normal value of those goods; and (b) because of that: (i) material injury to an Australian industry producing like goods has been or is being caused or is threatened…" 2 On 3 July 1998, ACS received an application from Amoco for anti-dumping measures to be imposed on imports of carpet backing fabric being exported to Australia from Belgium, Colombia, the Kingdom of Saudi Arabia, the United Kingdom and the United States of America, for the reason that the dumped exports from those countries were claimed to be causing material injury to the Australian industry conducted by Amoco reflected in price undercutting, price depression, price suppression, lost profits and profitability, lost sales, reduced investment and reduced employment levels. 3 The initiation of the investigation was notified publicly by Australian Customs Dumping Notice No 98/039, and by advertisements in the Australian Financial Review of 9 July 1998 and in the Commonwealth of Australia Gazette No S48 of the same day. Non-confidential summaries of the application and relevant questionnaires were distributed to known overseas exporters and Australian importers of carpet backing fabric, and placed on the public file. The ACS investigation process included the examination of submissions of participants in the carpet manufacturing industry, and the undertaking of on-site verification in Australia and overseas. Before addressing the investigation and its outcome, I will briefly outline the industrial context in which the issues in the proceedings have arisen for determination. 4 Each of the exporters of carpet backing fabric to Australia have operated here through four agents resident in Australia, which also sell other goods used in the textiles and carpet industries. Customs has identified the Australian market for carpet manufacture as having two distinct sectors of prominence. The first sector or tier of the Australian market, comprising over 70% thereof, has been under the control of the two largest carpet manufacturers, or so-called first tier producers in Australia, namely Godfrey Hirst Australia Pty Limited ("Hirst") and Shaw Industries Australia Pty Limited ("Shaw"), both being subsidiaries of multinational companies. Hirst and Shaw have purchased most of their primary carpet backing fabric requirements from Amoco, but have also acquired some of their requirements by way of import into Australia from overseas suppliers. The second sector or tier producers operating in the Australian market comprise nine carpet manufacturers, each of whom are individually much smaller than Hirst and Shaw, but who make up collectively about 25% of the carpet supply market in Australia. The major difference between the first and second tier carpet manufacturers has been in the quantity of carpet they respectively produce, and in the range of styles of carpet which they produce. Apart from scale of operations, there has been little apparent difference in manufacturing processes implemented by the first and second tier companies. There is also a third tier of manufacturers comprising small and specialised carpet manufacturers, mainly staffed by family members. 5 The Australian importers of carpet backing fabric from Colombia, Saudi Arabia and the United States of America have operated as traders, in that they purchase the fabric from those overseas suppliers and re-sell the same to end users in Australia. Those Australian agents maintain warehouse stocks in Australia, and sell to customers on a full container load basis wherever possible. Polyweave has an Australian agent who does not maintain warehouse stock, and customarily negotiates sales to Polyweave's Australian customers who contractually acquire the product directly from Polyweave in Belgium on a cost and freight basis. The United Kingdom supplier of carpet backing fabric had previously maintained warehouse stocks in Australia until 1998, but since then has been represented in Australia by an agent, whose practice is to identify an Australian customer, and thereafter arrange for the United Kingdom supplier to sell directly to that customer on a free-into-store basis. By reason of the way the Belgium and United Kingdom carpet backing fabric is sold into Australia, their Australian customers are normally prepared to accept full container loads. The Trade Measures Report 6 The documentary focus of the proceedings is Trade Measures Report No 1, which was prepared by two officers of the Trades Measures Branch of the ACS on 18 December 1998, pursuant to s 269TEA of the Act, sub-sections (1) and (5) whereof read as follows: "269TEA Report to Minister concerning publication of notices under this Part (1) If: (a) application has been made under section 269TB for publication of a dumping duty notice or a countervailing duty notice; and (b) the CEO has initiated an investigation in respect of the application under section 269TC; the CEO must, after holding such an investigation and before the end of the period for reporting to the Minister that is referred to in paragraph 269TC(4)(bf), give the Minister a report in respect of the goods the subject of the application that: (c) recommends whether any such notice should be published and the extent of any duties that are, or should be, payable under the Dumping Duty Act because of that notice; and (d) recommends, in particular, whether the Minister ought to be satisfied as to the matters in respect of which the Minister is required to be satisfied before such a notice can be published; and (e) recommends, where applicable, whether the Minister ought to give notice to the exporter under subsection 269TG(3D) or to the government of the country of export or to the exporter under subsection 269TJ(2A). … (5) The report to the Minister must include a statement of the CEO's reasons for any recommendation contained in the report that: (a) sets out the material findings of fact on which that recommendation is based; and (b) provides particulars of the evidence relied on to support those findings." By that Report, recommendations were made to the Minister for Justice and Customs for anti-dumping action in relation to carpet backing fabric against Polyweave as the exporter from Belgium, and also against the exporters of the product from Colombia, the Kingdom of Saudi Arabia, the United Kingdom and the United States of America, based upon the determination of the authors of the Report that the carpet backing fabric exported from those countries to Australia had been exported at "dumped" prices, and further that in consequence of that practice of dumping, the Australian carpet backing fabric manufacturing industry had suffered material injury. Dumping occurs when a product of one country is exported to another country at a price less than its normal value. The export price of goods and the normal value of goods are determined under ss 269TAB and 269TAC of the Act respectively (see [8-9] below). 7 It is necessary to summarise the Trade Measures Report in some detail, by reason of the comprehensive attention devoted thereto by the submissions of the parties by written and oral. It suffices to commence at Chapter 4 of the Report, which describes the Australian industry and market structure concerning primary carpet backing fabric, and in particular in relation to Amoco as the sole local manufacturer. The following findings of the Report as to the market size in relation to the supply of carpet backing fabric in Australia are extracted from page 12 thereof as follows: "Market Size The Australian market for primary backing fabric is directly linked to the production of carpet. In considering the size of the Australian market, Customs found that some of the goods imported have not been entered under the correct tariff classification and that the classification includes both primary and secondary carpet backing fabric. Because of the small number of importers, Customs was able to correctly identify goods imported during the investigation period. Customs considered that for the purpose of estimating the size of the market it would be reasonable to add total imports of primary backing for the 12 months to total sales by Amoco. Evidence to establish the actual quantity of primary backing fabric imported prior to July 1997 was not obtained. There does not appear to be any particular seasonal pattern to the purchase or use of primary carpet backing fabric. The product is a high volume, low value material input to carpet manufacture. The size of the Australian market is approximately 50 million square metres per annum. Imports accounted for approximately 14 million square metres in 1997/98. Details of sources of market supplies for financial year 1997/98 are set out in the following table. Australian Industry Belgium Colombia Saudi Arabia UK USA (million) m2 36.3 5.1 3.1 3.2 1.2 1.1 % of total 72.6 10.2 6.2 6.4 2.4 2.2 " 8 Chapter 5 of the Report was headed "The Dumping Investigation". In relation to Polyweave, the following appears: "Belgium Polyweave Real NV Customs investigation confirmed that Polyweave Real NV (Polyweave) manufactures the goods and exports them to Australia. The company uses an Australian agent, Catex Australia (Catex), to provide assistance with sales service, pursue orders and perform other sales functions in accordance with a sales agreement. In return, the agent is paid a commission on sales. Customs inquiries revealed that the importers of the goods exported by Polyweave are the Australian end users of the goods (carpet manufacturers). Customs was satisfied the sales of Polyweave to Australian end users were arms length transactions. On the basis that the goods were exported to Australia other than by the importer, were purchased by the importer from the exporter and were arms length transactions, Customs recommends export price be assessed under s 269TAB(1)(a) of the Act." Sub-section TAB(1) of the Act reads as follows: "(1) For the purposes of this Part, the export price of any goods exported to Australia is: (a) where: (i) the goods have been exported to Australia otherwise than by the importer and have been purchased by the importer from the exporter (whether before or after exportation); and (ii) the purchase of the goods by the importer was an arms length transaction; the price paid or payable for the goods by the importer, other than any part of that price that represents a charge in respect of the transport of the goods after exportation or in respect of any other matter arising after exportation; or …" 9 The recommendation that followed in Chapter 5 as to determination of the export price in relation to Polyweave carpet backing fabric was that normal value be assessed under subs 269TAC(1) of the Act, which reads as follows: "(1) Subject to this section, for the purposes of this Part, the normal value of any goods exported to Australia is the price paid or payable for like goods sold in the ordinary course of trade for home consumption in the country of export in sales that are arms length transactions by the exporter or, if like goods are not so sold by the exporter, by other sellers of like goods." The further recommendation in Chapter 5 was that adjustments to the selling price be made pursuant to subs 269TAC(8) in respect of the following items: "• inland freight and Free on Board (FOB) charges incurred on export sales; • differences between the specifications for the goods sold domestically and those exported to Australia; • commission paid in respect of export sales; • differences between the credit terms applicable for export and domestic sales; and • value added taxation tax paid on domestic sales." The conclusion at this point in relation to Polyweave was that Polyweave had provided sufficient details of its financial affairs to permit the ACS to find that the domestic sales, upon which it based its recommended normal values, were made by Polyweave in the ordinary course of trade. 10 Similar recommendations were made by the ACS pursuant to subs 269TAC(1) in relation to each of the other exporters, though the recommendations made pursuant to subs 269TAC(8) varied in relation to criteria. Chapter 5 concluded with the subject of "Dumping Margins", as follows: "5.3 Dumping Margins A dumping margin is the amount by which the export price is less than the normal value. It is expressed as a percentage of the export price. The margin may be established on the basis of a comparison of either: • weighted averages of comparable normal values and export prices; or • normal values and export prices on a transaction by transaction basis; or • a weighted average of normal values and individual export price transactions (if the export price differs significantly between purchasers, regions, or time periods). In this case Customs compared export prices and normal values on a transaction by transaction basis. It considered this method to be appropriate due to the wide range of margins, and the large proportion of exports that were dumped. The results of this comparison are summarised in the table below: Country Supplier Dumping Margins Volume Dumped * Belgium Polyweave 0-8% 27% Colombia Pavco 0-23% 59% Saudi Arabia Al Abdullatif 0-8% 60% UK Don & Low 0-45% 43% USA Synthetic 0-9% 58% USA Wayn-Tex 0-26% 43% * Percentage of total exports from each exporter (1997/98)" Other ACS findings were that since 1994, Polyweave's total volume of carpet backing fabric imported into Australia from overseas had varied from 25.24% in 1994 to 36% in 1998/99. 11 The next segment of the Report was Chapter 6 headed "Economic Condition Of The Industry". The findings thereof were understandably focused upon Amoco's Australian operations, Amoco being the only complainant. I have already summarised in [2] above Amoco's list of seven claimed aspects of economic injury arising out of the dumping conduct of the overseas suppliers complained of. ACS did not find the existence of sufficient evidence to support Amoco's claims of injury in the form of lost sales, reduced investment or reduced employment levels, but it did find the existence of evidence to support Amoco's claims of injury due to price suppression, price depression and price undercutting, and it further found that there were flow-on effects adversely to profits and profitability arising from such injury. These latter claims were reported to have been substantiated by the evidence provided by the Applicant in relation to what was considered to be a sufficient investigation period commencing on 1 July 1997, albeit that the injury statistics compiled by Amoco related to the period commencing on 1 July 1995. The ACS further reported that Amoco provided evidence in support of its contention that it was servicing its customers satisfactorily, so that loss of profitability and volume claims of Amoco could not be attributed to deficiency in service. An annual customer satisfaction survey, conducted by an independent organisation, showed that Amoco rated well with its customers, except in respect of price. Counter claims were recorded by ACS as having been made by most of the agents for overseas suppliers, to the effect that they could not match the prices at which Amoco sold to the first tier manufacturers, but could effectively compete against the generally higher prices at which Amoco offered primary backing to second and third tier manufacturers. 12 On the subject of price injury by way of price undercutting, price depression and price suppression, the ACS further reported that most of the carpet manufacturers had claimed that so long as quality was satisfactory, price was the most important factor in purchasing decisions, a thesis supported by the results of an independent customer survey conducted for Amoco. An internal customer visit report showed that Amoco had lost sales to Shaw, (which incidentally was owned by a USA based company said to be the largest carpet manufacturer in the world). Indeed, the Trade Measures Report stated that "Customs concluded that Amoco had experienced a reduction in the price obtained in its sales to Shaw and Hirst". In that context, it was observed by the ACS that Shaw had the purchasing power to buy at "world's best prices", being a leverage which it appeared to have exercised in its negotiations for sourcing from Amoco by insisting that Amoco's prices be "world competitive". That circumstance was found by the ACS to have caused Amoco to reduce its prices to Shaw, being a finding material to the Minister's ultimate decision. Moreover Hirst, being the other major Australian carpet manufacturer, had insisted on receiving from Amoco a price equivalent to that allowed by Amoco to Shaw as a condition of Hirst increasing its purchases of carpet backing fabric from Amoco, which was a further finding by the ACS material to the Minister's ultimate decision. Other carpet manufacturers had notified Amoco that its selling prices were too high, relative to importers' prices (ie prices required by overseas exporters). ACS examined the selling prices for imported carpet backing fabric charged to those manufacturing customers of Amoco, and found that Amoco's prices were generally higher than the prices at which imported fabric was being offered to those same customers. ACS further found that the prices at which second tier carpet manufacturers purchased primary carpet backing fabric, whether from Amoco or other suppliers, were at times considerably higher than the prices being paid by the two major carpet producers Shaw and Hirst. ACS considered that offers of imported fabric to these smaller customers, at prices similar to those paid by Shaw and Hirst, provided evidence of price under cutting in that segment of the market. Many of those carpet manufacturers had advised ACS that they were purchasing from Amoco from time to time, but had no regular purchasing pattern in relation to the Amoco product, and ACS considered that in such an environment, it was difficult for Amoco to reduce the impact of lower priced imports on its own prices. 13 The ACS found that Amoco had demonstrated that it had reduced its costs to make and sell during the injury period, but that it had also experienced a decline in its average selling price over the same period, and further that as a result, the profit margin earnt on each unit of sales had diminished. The ACS concluded that the verified financial and sales evidence provided by Amoco showed that its selling prices achieved in the market place had been diminishing, and that its margin between costs to make and selling prices had declined throughout the injury period, and thus that Amoco had suffered price injury in its sales to first tier, also to and second tier, carpet manufacturers. 14 Chapter 6 proceeded to conclusions however as to loss of sales, as distinct from price injury, sustained by Amoco. Partly because of the emphasis placed upon these findings by the Applicant, it is appropriate that I extract the same below: "The financial and sales evidence submitted by Amoco and verified by Customs demonstrated lost sales to some customers. Most of Amoco's sales are made to first tier carpet manufacturers. Second tier carpet manufacturers account for a much smaller share of Amoco's business. Amoco's share of total first tier business increased significantly in 1997/98. An element of injury considered by Customers was a claim that Shaw, one of the two largest customers, decided to operate a secondary sourcing policy and purchase some of its requirements from overseas. Shaw advised Customs that it has always purchased some of its requirements from overseas suppliers. Shaw maintained that, while the mix of styles purchased from Amoco may have varied from time to time, it continues to purchase the vast majority of its requirements from Amoco. Shaw maintains that, overall, it has not replaced Amoco product with lower priced imports. Hirst advised Customs that it has recently entered into an agreement to substantially increase its purchases from Amoco. Despite a report of a sales visit by Amoco representatives to Shaw which identified specific lost sales, Customs could not conclude that the purchasing patterns of the first tier Australian carpet manufacturers had caused an overall loss of total volume of sales. Some second tier carpet manufacturers buy Amoco's primary backing fabric. Several of them confirmed that within the last five years Amoco was their major supplier of primary backing fabric. All but one of these manufacturers advised that they now use mostly imported fabric. With one exception, the move from Amoco to imported fabric occurred prior to the commencement of the injury period identified in the application. Only one of the second tier manufacturers maintained Amoco as its primary source of primary backing fabric throughout the injury period. One of the second tier carpet manufacturers explained that Amoco had taken business from imported primary backing fabric at one stage but had subsequently lost the business to imported fabric. The company argued that this situation does not really support a claim that business had been lost to imports as the change in purchasing preference was more in the nature of the ebb and flow of business activity. Other carpet manufacturers advised that they purchase from Amoco from time to time but have no regular purchasing pattern for the Amoco product. It has been estimated by several of the companies involved in the carpet making industry that Hirst and Shaw account for over 70% of total Australian carpet production. These sources have also estimated that Amoco supplies Shaw and Hirst with about 90% of their primary backing requirements. Shaw and Hirst supported these claims. In contrast, whilst the proportion of the Australian market satisfied by sales to second and third tier carpet manufacturers is significant, that market is, in terms of volume, much less significant to Amoco. The increase in sales to first tier customers has more than offset any decline in sales to second tier customers. Consequently, Customs concluded that Amoco has lost some sales to import competition but overall has not lost sales and has not suffered injury due to lost sales." 15 Nevertheless in the next segment of Chapter 6 headed "Lost Profits and Profitability", the ACS found that its earlier Chapter 6 view in favour of Amoco as having sustained price injury in sales to first and second tier carpet manufacturers produced the consequence of reduced profitability and lower profits, albeit not loss of sales as I have already recorded in [14] above. The reasons for so finding were stated as follows: "Loss of profitability was claimed in the application. The evidence contained in the company's records and verified by Customs supported the claim. Amoco claimed that it had lost sales volume to a number of customers during the injury period. Customs confirmed that this was the case. However, Customs found that the total quantity of lost sales was more than offset by the increase in Amoco's sales to other customers. Amoco's total sales actually increased during the investigation period. However the average price of new sales was lower than that of the lost sales and the increased quantity of fabric sold has not been sufficient to offset the diminishing margin." Thus the ACS advanced an important step in its process of reasoning on the path to its ultimate conclusion that Amoco had suffered injury due to reduced profitability and lower profits, albeit not due to lost sales. 16 Under the concluding segment of Chapter 6 headed "Other Factors", the ACS referred to the restructuring of the carpet manufacturing industry that had occurred in Australia in more recent years, the most significant of which had been the consolidation of a number of the medium sized manufacturers into the two large conglomerations of Shaw and Hirst as first tier manufacturers, both of whom nevertheless claimed to the ACS that they had not purchased any more imported carpet backing fabric than in the past, and that therefore they could not have caused any volume injury to the Australian industry by virtue of their purchases of imported fabric, and that indeed the reverse was the case. The ACS recorded its finding as to the absence of evidence to the contrary of that assertion of Shaw and Hirst. 17 Nevertheless, consistently with what has been recorded in [15] above, the ACS concluded that the negotiating power of the major customers had substantially altered the commercial leverage available to Amoco, and the threat of lost sales of substantial volumes of carpet backing fabric to imported fabrics had forced Amoco to negotiate lower prices, and this has caused injury to Amoco in these transactions. The ACS indicated in this context that importers of primary backing fabric and other end users had argued that the suppliers of imported primary backing fabric were not in direct competition with Amoco because Amoco did not effectively service the market comprising the second and third tier manufacturers. The ACS noted that evidence provided by Amoco demonstrated that Amoco does make approaches to these sectors in the industry, and that it was also apparent from the evidence obtained from end users and importers that most of the successful sales of imported fabric had been to either established customers or to customers who purchased other goods from the same exporter. 18 The conclusions of the ACS to Chapter 6 of the Trade Measures Report No 1 were in the following terms, the first and third of which are of critical relevance: (i) "The information available to Customs suggests that Amoco has suffered injury as a result of the changed negotiating position of its first tier customers, as they took advantage of low import prices in their negotiations with Amoco." (ii) "Customs could not find sufficient evidence to reach a conclusion that Amoco had suffered injury or is threatened with material injury in relation to its sales to second tier carpet manufacturers." (iii) "Customs found that the Australian industry has suffered injury as a result of price undercutting, price suppression, price depression, loss of profitability and lower profits. The evidence provided by Amoco shows the injury suffered is material." Those findings formed the setting for the critically important Chapter 7 which followed. 19 Chapter 7 of the Trade Measures Report No 1 was headed "Has Dumping Caused Material Injury", and initially recorded the claims of Amoco that imports at dumped prices had targeted six customers representing over 97% of Amoco's total sales, and that sales of imports to those customers accounted for approximately 95% of all imports, and further that injury was suffered as a result of price effects, being effects causing loss of profits and profitability. Amoco further claimed that the low prices for imported carpet backing fabric arose as a result of sales by overseas exporters to Australian customers at dumped prices. 20 The Australian importers and agents for overseas suppliers provided the following information to the ACS in response to the allegations of Amoco: (i) Two carpet manufacturers (obviously referred to Shaw and Hirst) controlled over 70% of the manufactured carpet market in Australia, and according to some industry participants, they controlled as high as 80% thereof; moreover sellers of imported carpet backing fabric considered that they were effectively excluded from the large volume market by the pricing arrangements between Amoco and those two major manufacturers, and that the prices at which Amoco offered carpet backing fabric to Australian carpet manufacturers, other than the larger two manufacturers, were premium prices, and it was only in that limited sector of the market for carpet backing fabric that such other suppliers of the fabric believed that they were able to compete against Amoco; (ii) the importers and agents for overseas suppliers, and also end users not there identified, were said to have further explained to the ACS that there had been substantial structural change in the Australian carpet industry, which had materially altered Amoco's position; this substantial structural change was said to have resulted from "considerable rationalisation of manufacturing", involving the reduction in the number of carpet manufacturers, on one estimate, from "around 45" five years earlier to "around 20 today", and further that in particular, the changes among the 10 or so larger manufacturers had produced a major impact upon Amoco; (iii) prior to Amoco's nominated injury, there had been at least 5 carpet manufacturers engaged in the Australian market who would have been generally recognised as large producers; the subsequent acquisition of approximately 75% of the Australian production of carpets in the hands of Shaw and Hirst had provided those two conglomerates with enormous purchasing power; and (iv) even if carpet backing fabric had been exported to Australia at dumped prices, the imports the subject of the alleged dumping could not have caused injury to Amoco. 21 The assessment of those contentions of importers and agents for overseas suppliers, undertaken by the ACS, was to the effect that "[t]he evidence submitted by the applicant did not support a claim that volume injury had been suffered by the Australian industry", and that "[n]o evidence was obtained during the course of the investigation to support such a claim". The available evidence in fact demonstrated, in the view of the ACS, that Amoco had been able to increase both its overall market share and its total quantity of fabric sold since the commencement of the claimed injury period, that is to say, during the same period of time when the Australian market increased by more than 15%. Moreover the ACS considered that improvements in the overall quantity of goods sold and in Amoco's market share had also occurred during the investigation period commencing 1 July 1997, and Amoco would have had a substantially larger market, had it not lost any of its other customers in the normal course of trade. In the case of Hirst, the ACS found that Amoco had become the major supplier of carpet backing, with the consequence that the quantity of product sales lost in other sectors of the market was more than offset by the additional quantities thereof purchased by Hirst. Though the ACS accepted that any lost sales in business is ex hyposesi injurious, changes in purchasing behaviour nevertheless suggested a normal ebb and flow of business. For the foregoing reasons, the ACS concluded that Amoco had "not suffered injury as a result of sales lost to imported carpet backing fabric". 22 Moving then from so-called "volume effects" to what became the ultimate critical issue of so-called "price effects", the ACS referred to details provided by Amoco of its dealings with customers throughout the injury period, and found that "[p]rice comparisons between imported primary backing fabric and the products offered by Amoco emerged as the dominant issue in Amoco's dealings with its customers", and further that "[t]he evidence provided by Amoco showed a link between some lost sales, the lower prices obtained in sales to customers and the pricing of imported carpet-backing fabric". ACS observed that the information provided by Amoco was usually obtained by sales representatives in the context of price negotiations, and whilst recognising that importers' prices said to have been provided by the overseas exporters might not necessarily reflect actual prices paid to such exporters, ACS nevertheless observed that the price of fabric was crucial to many of the purchasing decisions which had been made in the industry, and further (and obviously) that most customers identified price as an important factor, and that unlike price, other factors could not be quantified. The ACS thereafter made the following critical observations and findings: (i) although Amoco did not demonstrate that it had lost market share or overall volume of sales, all of the end users who ceased or reduced their purchasing of Amoco fabric gave price competitiveness as one of the reasons for switching to imported fabric; (ii) the increase in Amoco's sales to Hirst was only achieved at a reduced price; though Hirst stated that the price negotiated with Amoco had been based on Amoco's sales to Shaw, and had not been influenced by prices available to Hirst for imported fabric, yet since the price paid by Hirst was linked to the price paid by Shaw, and Shaw's price was linked to the price of imported fabric, the ACS considered that the price paid by Hirst to Amoco was also linked to the dumped prices of the imported carpet backing fabric; and (iii) Amoco had suffered injury as a result of the prices it achieved in sales to Shaw and Hirst; in that regard, Shaw confirmed to the ACS that it had purchased carpet backing fabric from most of the suppliers of imported fabric, and it was also known that Shaw's parent company had its own primary carpet backing fabric manufacturing facility, and was able to purchase raw materials, such as primary carpet backing fabric, on the basis of global purchasing requirements; moreover the ACS discussions with Shaw confirmed that Shaw had taken into account the prevailing competitive prices when making its purchasing decisions; it followed, so the ACS deduced, that the price of imported fabric had been a factor in the price paid to Amoco by its major customers. 23 The ACS next referred to the requirements of subs 269TAE(2) of the Act, which reads as follows: "(2) In determining, for the purposes of section 269TH or 269TK, whether material injury to an industry in a third country has been or is being caused or is threatened or would or might have been caused because of any circumstances in relation to the exportation of goods to Australia from the country of export, the Minister may, without limiting the generality of that section but subject to subsections (2A), (2B) and (2C), have regard to: (aa) if the determination is being made for the purposes of section 269TH – the size of the dumping margin, or of each of the dumping margins, worked out in respect of goods of that kind that have been exported to Australia and dumped; and (ab) if the determination is being made for the purposes of section 269TK – particulars of any countervailable subsidy received in respect of goods of that kind that have been exported to Australia; and (a) the quantity of goods of that kind that, during a particular period, have been or are likely to be exported to Australia from the country of export; and (b) any increase or likely increase, during a particular period, in the quality of goods of that kind exported to Australia from the country of export; and (c) any change or likely change, during a particular period, in the proportion that: (i) the quantity of goods of that kind exported to Australia from the country of export and sold or consumed in Australia; or (ii) the quantity of goods of that kind, or like goods, produced or manufactured in the third country and sold or consumed in Australia; bears to the quantity of goods of that kind, or like goods, sold or consumed in Australia; and (d) the export price that has been or is likely to be paid by importers for goods of that kind exported to Australia from the country of export; and (e) the difference between: (i) the price that has been or is likely to be paid for goods of that kind, or like goods, produced or manufactured in the third country and sold in Australia; and (ii) the price that has been or is likely to be paid for goods of that kind exported to Australia from the country of export and sold in Australia; and (f) the effect that the exportation of goods of that kind to Australia from the country of export in those circumstances has had or is likely to have on the price paid for goods of that kind, or like goods, produced or manufactured in the third country and sold in Australia; and (g) the effect that the exportation of goods of that kind to Australia from the country of export in those circumstances has had or is likely to have on the relevant economic factors in relation to the producer or manufacturer in the third country." In that context, the Trade Measures Report No 1 referred to the assertions made by "some interested parties" that the injury suffered by Amoco was not due to dumped imports, and that Amoco had suffered injury as a result of higher raw material input prices and lower productivity than was being achieved by more modern overseas production facilities. The response of the ACS thereto was in the following terms: "During the investigation, Customs found no evidence of injury caused by factors other than pricing. To the extent that overseas suppliers may be able to produce at a lower cost than the Australian industry, it is arguable that some of the injury suffered may be due to factors other than dumped imports. Although they may be produced at a lower cost, they have been sold at dumped prices in the Australian market and this has resulted in Amoco receiving lower prices." 24 Other circumstances found or established by ACS to its apparent satisfaction were as follows: (i) all overseas suppliers, that is to say, not just Polyweave, had been selling carpet backing fabric into Australia at dumped prices, the lowest priced of all of such product from overseas emanating from Saudi Arabia; I interpolate to record that in the course of address, the Applicant accepted that circumstance to have been established; and (ii) the two most important decision-making factors to buyers of carpet backing fabric were first "whether the carpet making machinery [of the carpet manufacturers] worked well with the fabric", and secondly "price"; because of the former factor, involving as it did the possibility of incompatibility between the machinery and the fabric, and the consequential risk of changeover, carpet manufacturers were "not normally inclined to change suppliers in order to enjoy a slight cost benefit", and hence the co-existence in the market of a range of prices, all having an impact on Amoco, and not just the lowest prices at any time. 25 The following critical conclusion to Chapter 7 was as follows: "Customs concluded that imports of primary carpet backing fabric at dumped prices have caused material injury to the Australian industry and that all of the exporters have contributed to the injury." And under the heading "Continuation of Material Injury", Chapter 7 concluded as follows: "While there was no evidence to suggest an imminent threat of sales lost to imported primary backing fabric the dominance of price in the purchasing decisions of most customers supports a view that the continuing availability of low priced imported primary backing fabric constitutes a threat to the local manufacturer. Customs believes it is possible that future shipments may be dumped and, should dumping continue, the price effects of the dumped imports would continue to cause material injury to Amoco." 26 Under the Chapter 7 heading "Materiality", the ACS reported as follows: "Amoco provided confidential evidence showing declines in the company's profitability and gross margin on primary carpet backing fabric. Customs concluded that the injury caused through lost profits was material." And under the heading "Conclusion", further: "… that imports of primary carpet backing fabric at dumped prices have caused material injury to the Australian industry and that all of the exporters have contributed to the injury". A final observation was then made in Chapter 7, under the heading "Continuation of Material Injury", as follows: "While there was no evidence to suggest an imminent threat of sales lost to imported primary backing fabric the dominance of price in the purchasing decisions of most customers supports a view that the continuing availability of low priced imported primary backing fabric constitutes a threat to the local manufacturer. Customs believes it is possible that future shipments may be dumped and, should dumping continue, the price effects of the dumped imports would continue to cause material injury to Amoco." 27 The Trade Measures Report No 1 addressed in Chapter 8 the subject of "Anti-Dumping Measures", and thus the ascertainment of normal values, export prices, non-injurious prices and interim dumping duty, and in Chapter 9 the making of recommendations, the first of which was in the following terms: "Therefore, Customs will recommend the Minister take anti-dumping action under s 269TG(1) and s 269TG(2) of the Act against imports of woven polypropylene primary carpet backing from each of the abovementioned exporters [referring thereby to Polyweave of Belgium, Pavco of Colombia, Al Abdullatif of Saudi Arabia, Don & Low of the UK and Synthetic and Wayn-Tex of the USA]. Customs will further recommend that the anti-dumping action pursuant to ss 269TG(1) and 269TG(2) include exports by residual exporters." The material part of subs 269TG(1) of the Act has been extracted at the commencement of these Reasons for Judgment. It was further recommended that the Minister direct that anti-dumping duty action be taken pursuant to subs 8(5) of the Customs Tariff (Anti-Dumping) Act 1975 (Cth). 28 Such recommended action was to be taken by the Minister upon the satisfaction of the Minister, being satisfaction also recommended by the ACS for adoption, as to the following matters: "1. pursuant to s 269TACB(5) of the Act, export prices in respect of some individual transactions during the investigation period were less than the corresponding normal values in respect of exports of woven polypropylene primary carpet backing by Polyweave of Belgium, Pavco of Colombia, Al Abdullatif of Saudi Arabia, Don & Low of the UK and Synthetic and Wayn-Tex of the USA; 2. pursuant to s 269TAE(2C) of the Act, having regard to the conditions of competition between woven polypropylene primary carpet backing exported to Australia and the conditions of competition between those goods and like goods domestically produced, that it is appropriate to consider the cumulative effects of those exportations; 3. pursuant to s 269TG(1) of the Act, export prices in respect of some woven polypropylene primary carpet backing that have been exported to Australia is less than the amount of the normal value of those goods, and because of that material injury to an Australian industry producing like goods has been caused; 4. pursuant to s 269TG(2) of the Act, the export price of some woven polypropylene primary carpet backing already exported to Australia is less than the normal value of those goods and the export price of woven polypropylene primary carpet backing that may be exported to Australia in the future may be less than the normal value of the goods, and because of that material injury to an Australian industry producing like goods has been or is being caused." 29 Recommendations were additionally made by the ACS as to pricing adjustments etc in relation to Polyweave of Belgium inter alia being calculated and implemented as follows: "6. pursuant to s 269TAC(8) of the Act, direct that the domestic selling prices of like goods sold by Polyweave of Belgium be adjusted for differences between domestic and export sales in inland freight and FOB charges, specifications, selling commission, credit terms and taxation (value added taxation); … 12. pursuant to s 269TACB(1) of the Act, determine, by comparison of the export prices of individual transactions over the whole of the investigation period with the corresponding normal values in respect of exports of woven polypropylene primary carpet backing by Polyweave of Belgium, Pavco of Colombia, Al Abdullatif of Saudi Arabia, Don & Low of the UK and Synthetic and Wayn-Tex of the USA, that some of those goods were dumped; 13. pursuant to s 269TG(1) of the Act, declare, by public notice, that section 8 of the Customs Tariff (Anti Dumping) Act 1975 applies to woven polypropylene primary carpet backing that has already been exported to Australia from Belgium, Colombia, Saudi Arabia, the UK and the USA; 14. pursuant to s 269TG(2) of the Act, declare, by public notice, that section 8 of the Customs Tariff (Anti-Dumping) Act 1975 applies to exports of woven polypropylene primary carpet backing that are exported from Belgium, Colombia, Saudi Arabia, the UK and the USA to Australia after the date of publication of the notice, an the amount of the export price of which is less than the amount of their normal value; 15. pursuant to s 269TG(3) of the Act, ascertain the normal value, export price and non-injurious price in respect of woven polypropylene primary carpet backing exported from Belgium, Colombia, Saudi Arabia, the UK and the USA for the purposes of the notice under s 269TG(1) of the Act; 16. pursuant to s 269TG(3) of the Act, ascertain the normal value, export price and non-injurious price in respect of woven polypropylene primary carpet backing exported from Belgium, Colombia, Saudi Arabia, the UK and the USA for the purposes of s 269TG(2) of the Act; 17. pursuant to s 8(5) of the Customs Tariff (Anti-Dumping) Act 1975 direct that the element of interim dumping duty referred to in s 8(4)(a) of the Customs Tariff (Anti-Dumping) Act 1975 for exports of woven polypropylene primary carpet backing from Belgium, Colombia, Saudi Arabia, the UK and the USA be ascertained by reference to a measure of the quantity in square metres; 18. publish legal instruments under s 269TG(1) and s 269TG(2) of the Act (excluding the Tables attached to the instruments), under s 269TG(6)(b) of the act, and under s 8(5) of the Customs Tariff (Anti-Dumping) Act 1975 (relating to the element of interim dumping duty); 19. agree that, on the grounds of confidentiality, the tables attached to the legal instruments under s 269TG(1) and s 269TG(2) of the Act not be published." Ministerial and other executive action undertaken pursuant to Trade Measures Report No. 1 30 On 12 January 1999, the Minister for Justice and Customs signed several instruments/ declarations arising out of or based upon the Trade Measures Report No 1, including the following: "CUSTOMS ACT 1901 DECLARATION PURSUANT TO SUBSECTION 269TG(1) I, AMANDA VANSTONE, Minister for Justice and Customs, pursuant to subsection 269TG(1) of the Customs Act 1901, DECLARE that section 8 of the Customs Tariff (Anti-Dumping) Act 1975 applies to woven polypropylene primary carpet backing fabric ('the goods'), exported to Australia from Belgium, and ASCERTAIN that the normal value, export price and non-injurious price of the goods are those amounts set out in the attached Table. Dated this 12th day of January 1999 AMANDA VANSTONE Minister for Justice and Customs Note: Because of confidentiality, the ascertained normal value, export price and non-injurious price will not be published. THE TABLE PURSUANT TO SUBSECTION 269TG(1) Commodity: WOVEN POLYPROPYLENE PRIMARY CARPET BACKING Country of Export: BELGIUM Exporter Style Ascertained Ascertained Ascertained warp x weft Normal Value Export Price NIP (ends/10cms) AUD/sqm AUD/sqm AUD/sqm Polyweave Real NV 94 x 64 0.3071 0.2789 0.3071 Polyweave Real NV 112 x 64 0.3374 0.3333 0.3374 Polyweave Real NV 112 x 71 0.3612 0.3554 0.3612 All Other Exports 0.2988 0.2829 0.2988 Notes: 1. Terms are FOB, 90-120 days, packed, port of shipment 2. A tolerance of + 5% to – 5% is applicable to the warp and weft counts of the styles specified above for Polyweave Real NV. CUSTOMS ACT 1901 DECLARATION PURSUANT TO SUBSECTION 269TG(2) I, AMANDA VANSTONE, Minister for Justice and Customs, pursuant to subsection 269TG(2) of the Customs Act 1901, hereby DECLARE that section 8 of the Customs Tariff (Anti-Dumping) Act 1975 applies to goods, being like goods to woven polypropylene primary carpet backing fabric exported to Australia from Belgium: (a) that are exported to Australia from the above mentioned country after the date of publication of this notice; and (b) the amount of the export price of which is less than the amount of their normal value and hereby ASCERTAIN that the normal value, export price and non-injurious price for woven polypropylene primary carpet backing fabric are those amounts set out in the table attached. Dated this 12th day of January 1999 AMANDA VANSTONE Minister for Justice and Customs Note: Because of confidentiality, the ascertained normal value, export price and non-injurious price will not be published. THE TABLE PURSUANT TO SUBSECTION 269TG(2) Commodity: WOVEN POLYPROPYLENE PRIMARY CARPET BACKING Country of Export: BELGIUM Exporter Style Ascertained Ascertained Ascertained warp x weft Normal Value Export Price NIP (ends/10cms) AUD/sqm AUD/sqm AUD/sqm Polyweave Real NV 94 x 64 0.3071 0.2789 0.3071 Polyweave Real NV 112 x 64 0.3374 0.3333 0.3374 Polyweave Real NV 112 x 71 0.3612 0.3554 0.3612 All Other Exports 0.2988 0.2829 0.2988 Notes: 1. Terms are FOB, 90-120 days, packed, port of shipment 2. A tolerance of + 5% to – 5% is applicable to the warp and weft counts of the styles specified above for Polyweave Real NV." 31 Polyweave and the Saudi Arabian exporter subsequently sought review of the Minister's implementation of the recommendations of the Trade Measures Report No 1, and the Trade Measures Review Officer of the Attorney General's Department undertook such review, pursuant to s 269ZZK of the Act, and made recommendations in writing on 7 May 1999 to the Minister to require that the Chief Executive Officer of the ACS investigate certain of the findings the subject of the Trade Measures Report. Those recommendations, based upon a lengthy undated document called "Review of Decision to Take Anti-Dumping Action against Imports of Primary Carpet Backing Fabric from Belgium and Saudi Arabia", included the following: "Having regard to the information in relation to the investigation, the Review Officer recommends that the Minister require Customs, in respect of findings in relation to Polyweave, to reassess its findings in respect of a causal link between the dumping of carpet backing fabric and the material injury suffered by the Australian industry; and reassess a Non-Injurious Price." Set out in that Review document under the heading "Price Injury" was the following: "Price Injury Polyweave claims that all producers of carpet backing worldwide have been confronted with a price fall due to the law of supply and demand, and increased purchasing power of concentrated carpet activities, the open market situation and increased production capacity. Polyweave refers to the changing structure of the Australian carpet market which it claims led to a situation where the first tier carpet manufacturers, Godfrey Hirst Australia Pty Ltd (Hirst) and Shaw Industries Australia Pty Ltd (Shaw), now comprise at least 70% of the Australian market; second tier carpet manufacturers comprise about 25%; and third tier producers represent the remainder. Polyweave claims that Amoco focused its selling efforts on the first tier producers, that the purchasing power of these producers is based on the volumes they consume and that their purchasing policy is to have at least a secondary source of supply. Polyweave asserts that Shaw operates worldwide and knows world market prices for carpet backing. Polyweave notes that Customs reported that Shaw's parent company has its own primary carpet backing fabric manufacturing facility. Polyweave argues that, as a consequence, Shaw confronted Amoco with the price setting of Amoco worldwide and required Amoco to sell in Australia at the same price. Polyweave claims that Hirst subsequently applied pressure on Amoco to be supplied at the same prices as Shaw. Polyweave contends that it is unjustifiable to attribute the price pressure on the Australian market to the imported goods, as this pressure was due to the changed structure of the carpet manufacturing industry and the changed negotiating position of the first tier producers. Polyweave claims that the reason Amoco made the necessary efforts on price was to ensure that it did not lose its high volume sales to the first tier producers, and that Amoco's efforts on price for these two producers resulted in a share of some 90% of the first tier market. Polyweave notes that Customs reported that, based on extremely competitive pricing by Amoco, Hirst changed its sourcing of carpet backing fabric to increase substantially its purchases from Amoco at the expense of importers. Polyweave assumes that Amoco quoted prices under those then available to Hirst, and contends that the price fall Amoco accepted can, in no way, be the result of alleged dumping by Polyweave. Polyweave claims it cannot have caused injury because the price fall started at Shaw and in the period of investigation Polyweave did not even quote to Shaw. Polyweave asserts that the price to Hirst is linked to the price to Shaw, and is not influenced by prices available to Hirst for imported fabric. Polyweave claims that, as it did not even quote to Shaw, it cannot be held responsible for the price fall in Amoco's first tier customers. Polyweave suggests that a close examination seems necessary of the trend of prices offered by Polyweave compared with the trend of Amoco's prices. Polyweave reiterates its claim that Amoco dropped its prices to maintain market share." Thereafter the Review Officer summarised the ACS findings made in the Trade Measures Report. The Officer's assessment, upon which the Applicant strongly relied as supportive of its contentions of legal principle, was recorded as follows: "The Review Officer does not agree with Customs conclusion that, as the price paid by Hirst is linked to Shaw, it necessarily follows that those prices are linked to the prices of allegedly dumped imports. Customs stated that Shaw demanded 'world competitive' prices due to its global purchasing power. It cannot be clearly demonstrated that this pricing leverage is related to dumped imports. In assessing whether dumping has occurred and whether that dumping has caused material injury to the Australian industry, it needs to be established that it was this and no other factors which may have contributed to the injury suffered by the local industry. While the Review Officer accepts Customs' findings in respect of price effect causing material injury to the Australian Industry, he does not accept that an analysis of the evidence upon which Customs based its findings can clearly demonstrate a causal link between the injury sustained by the local industry and dumped imports from Belgium." 32 By letter dated 9 June 1999, an officer of the Attorney-General's Department responded to an apparently verbal communication made to the Attorney-General's Department by the Minister as follows: "Trade Measures Review – Carpet Backing You expressed some concerns about the recommendations of the Trade Measures Review Officer's review of Customs' decisions on carpet backing. I have now had a chance to look at the issues and to discuss them with Customs and some of our legal staff. At the outset I should make it clear that none of the staff of the Review Office are lawyers. That said, I agree with the Review Officer that a number of the issues should be reconsidered by Customs. I accept, as does Customs, that these are some fine judgments involving complex issues of fact and law, but that is inherent in the structure of the subject matter. The area where I think the case for review is clearest is the issue of causal link. The only area where I think the Customs view is to be preferred over that adopted by the Review Officer is the proposition that normal values be 'trade adjusted' to take account of credit risk in the Al Abdullatif (the s 269TAC9(8) recommendation). At the end of the day it is, of course, your decision but the one thing I think you can be certain is that whichever way you decide, that decision will be litigated. I agree that you can agree or disagree with all or any of the recommendations." The latter expression of view was of course prophetic. This letter was followed by a submission formally made by the Trade Measures Review Officer of the Attorney General's Department on 11 June 1999 recommending consideration of his comprehensive Review document of some 16 pages. The Applicant submitted that "… no one gave reconsideration to the problem and no one accepted even the opinion of the Minister's own staff on causal link". However I would not draw the inference that there was an absence of reconsideration of the issue of causal link, in the light of the content of the communications which followed. The Minister's initial response of 9 July 1999 was to seek comments from the ACS on the following "four points" which she identified from the Report of the Trade Measures Review Officer of the Department of the Attorney General: "1. Physical characteristic differences in the goods. 2. Credit risk. 3. Causal link. 4. Non-injurious price." 33 The ACS replied at some length to the Minister's queries of 9 July 1999 by the ACS Minute Paper of 30 July 1999 (the reference to 'TMRO" is to the "Trade Measures Review Officer"), the material parts whereof for present purposes appearing under the heading "Causal link" and reading as follows: "At page 14 of the report the TMRO accepts Customs findings "in respect of price effect causing material injury to the Australian injury". However the report goes on to state that the TMRO "does not accept that an analysis of the evidence… can clearly demonstrate a causal link between the injury sustained by the local industry and dumped reports from Belgium". It is difficult to reconcile this conclusion with the ability of an investigating authority to assess the cumulative effect of dumped imports from all sources. Customs had established that dumping had occurred from both Belgium and Saudi. At page 11 of the report the TMRO accepted Customs assessment of normal values and dumping margins in respect of the Belgian exporter. Customs was satisfied that dumped imports from all sources had caused a price effect which resulted in material injury to the local industry. The TMRO's conclusion suggests a focus on identifying whether exports from individual countries of themselves caused material injury; such analysis is not required." Thereafter under the heading "Non injurious price", the following appeared: "The TMRO at page 16 of the report concludes that he does not agree with Customs determination of a non-injurious price (NIP) for the Belgian exporter and recommends that Customs be required to reassess a NIP through the application of a consistent exchange rate methodology. This conclusion is reached after a recital of the Belgian exporter's claims. Those claims reflect a misunderstanding of the method by which Customs ascertained normal values rather than the NIP. As the report does not particularise what the TMRO considered to be the flaw in Customs method, it does not provide any useful guidance to assist in any reconsideration of the NIP. Further, it is questionable whether it was necessary for the TMRO to come to any finding in relation to the NIP. The Customs report makes it clear that the legislation requires that a NIP be set. It is one of the three variable factors that the Minister must determine. The report however makes clear that it was not possible, for various reasons, to settle upon an appropriate method for the calculation of the NIP. Accordingly Customs "decided to recommend that the NIP prices be set at the same level as the ascertained normal values". In essence the NIP then became redundant as the operative measures were set by reference to the ascertained normal values. The TMRO has made no finding in relation to the method used by Customs in its calculation of normal value. On the contrary, at page 11 of his report the TMRO "accepts Customs assessment of [the Belgian exporter's] normal values and dumping margins". That said, the only rationale for the Belgian exporter raising the claim in relation to the NIP is that it must believe that, if Customs had applied a correct method, the resulting NIP would be at a lower level than the normal value. As indicated above, the exporter's claims in relation to the NIP reflect a misunderstanding of the method used to determine normal values. The TMRO's conclusions do not provide Customs with any useful guidance as to the manner in which it should go about any reconsideration of the NIP." 34 The Minister's lengthy response of 19 August 1999 to the Trade Measures Review Officer of the Attorney-General's Department related to both the Belgium (ie Polyweave) and Saudi Arabian exporters. It demonstrated a preference for the findings of the ACS. I extract below the material parts thereof: "I refer to your report and recommendations regarding the review of the decision to take anti-dumping action against imports of primary carpet backing fabric from Belgium and Saudi Arabia. Your report recommends that two issues should be remitted to Customs in respect of the Saudi exporter (Al Abdullatif) and that a further two issues in respect of the Belgian exporter (Polyweave) should also be remitted. I have carefully considered your recommendations and supporting arguments but have rejected each of your recommendations. My reasons are outlined below. Would you please arrange for a copy of this letter [to] be provided to interested parties?" Thereafter the Minister addressed the Saudi Arabia export issue and rejected the recommendation of the Trade Measures Review Officer to reassess the "causal link in relation to Saudi sourced carpet backing", and in so doing, the Minister made the following observation: "I accept that the issue of causal link is one of the most difficult issues that investigating authorities are required to assess. It requires fine judgment involving complex issues of fact and law." The Minister's response concluded in relation to Saudi sourced carpet backing to the effect that the Minister remained satisfied that a causal link had been established. The response then continued in relation to Polyweave as follows: "Belgium – Polyweave The TMRO has also recommended that Customs reassess its finding in respect of causal link between the dumping of the carpet backing fabric (from Belgium) and the material injury suffered by the Australian industry. The TMRO approach focuses upon the attribution of injury to individual exporters rather than upon the cumulation of injury caused by dumped imports from all sources. This approach is most evident in its treatment of the exports from Belgium. At page 14 of the report the TMRO accepts Customs findings "in respect of price effect causing material injury in the Australian industry". However the report goes on to state that the TMRO "does not accept that an analysis of the evidence… can clearly demonstrate a causal link between the injury sustained by the local industry and dumped imports from Belgium". The TMRO report argues that 'the pricing leverage' of the two major Australian carpet manufacturers, which is apparently accepted as fact, cannot be 'clearly demonstrated' to be linked to imports, which are also accepted as dumped. This claim of a lack of linkage is simply asserted, without citing detailed evidence in support of plausible alternative causes of the price effects, which are also accepted. I have therefore rejected the TMRO's recommendation to reassess causal link in respect of the Belgian exporter as I remain satisfied that a causal link was established for the reasons set out in the initial Customs report. …" The Minister's rejection of the recommendation of the Trade Measures Review Officer was made pursuant to s 269ZZL of the Act. It is appropriate to record here that the Applicant accepted, in the course of address, that "… the Customs and the Minister can look at the aggregate effect of all of the exports, [and] that's in fact what Customs did". The Application to this Court for review and the submissions made in support 35 The Applicant's final form of pleading comprised a Further Amended Statement of Claim ('S/C") filed on 3 August 2000, which by pars 11A, 11B and 11C thereof advanced the following causes of action referrable to the Minister's decision of 12 January 1999, and the Minister's affirmation of that decision of 19 August 1999, in summary, as follows; (i) there was no evidence or other material to justify the making of the decision of the Minister on 12 January 1999, or the affirmation thereof, within s 5(1)(h) of the Administrative Decisions (Judicial Review) Act 1977 (Cth) ("ADJR Act"), in that the Minister was only able to reach the decision which he did if there were grounds to conclude that material injury to an Australian industry producing like goods had been or was being caused by the fact that the amount of the export price of the goods was less than the normal value of those goods, and there was no evidence or other material from which the Minister could reasonably have been satisfied that the factor of causation was established, within s 5(3)(a) of the ADJR Act. (ii) The making of the decision and the affirmation thereof involved an improper exercise of the power conferred by the Act, within s 5(1)(e) of the ADJR Act, in that the Minister took into account irrelevant considerations, within s 5(2)(a) of the ADJR Act, and failed to take into account relevant considerations in the exercise of the power, within s 5(2)(b) of the ADJR Act, and involved an error of law by so failing to take into account such relevant considerations. (iii) The decision (and presumably, though not explicitly stated, the affirmation of the decision) involved an improper exercise of the power conferred by s 5(1)(e) of the ADJR Act, for the further reason that the exercise of the power to make the decision was so unreasonable that no reasonable person could have so exercised the power, within s 5(2)(g) of the ADJR Act. 36 The particulars provided by the Applicant of the causes of action pleaded in paragraphs (i) and (ii) of [35] above, as set out in the S/C, were as follows (the references to "Respondent" being of course to the Minister): "(i) The Respondent has no power to take anti-dumping measures unless, inter alia, material injury to an Australian industry producing like goods has been or is being caused because of the fact that the amount of the export price of the goods is less than the amount of the normal value of those goods. (ii) There is no power to take anti-dumping measures unless the Respondent is satisfied as to the goods that because of the fact that the amount of the export price of like goods that may be exported to Australia in the future may be less than the normal value of the goods, material injury to Australian industry producing like goods is threatened. (iii) There was no evidence upon which the Respondent could make a finding that material injury, either in fact or threatened, was caused by the fact, (which fact is not admitted), that the amount of the export price of the goods is or was less than the amount of the normal value of those goods. (iv) There was no evidence available to the Respondent other than evidence from which the only conclusion which could reasonably be drawn was that any material injury threatened or otherwise to Australian Industry by reason of any price fall, was caused by the purchasing power and negotiating power of Shaw Industries Australia Pty Ltd (Shaw) and Godfrey Hirst Australia Pty Ltd (Hirst) which collectively comprise 70% of the Australian first tier carpet manufacturers and pressure placed by Shaw and Hirst on Amoco Chemicals Pty Ltd (Amoco) to provide Shaw and Hirst with world competitive prices unrelated to the best prices available for imported goods. (v) There was no evidence available to the Respondent other than evidence from which the only conclusion which could be reasonably drawn was that any price reduction suffered by Amoco was not influenced by or caused by prices available for imported goods. (vi) There was otherwise no evidence of reduction in prices offered by Amoco to any other Australian carpet manufacturers. (vii) The Respondent having found that the price set by AMOCO in the domestic market was determined by negotiation with Shaw as to world best competitive prices, unreasonably concluded against the evidence or only evidence that the causal link to the price fall and price injury (if any, which is not admitted) in the Australian market was solely attributable to the imported best prices of the Applicant. (viii) The Respondent having found that the price set by AMOCO for sales to Hirst was set by the price negotiated by AMOCO with Shaw unreasonably concluded that the causal link to the price fall and price injury (if any, which is not admitted) in the Australian domestic market impacting on the selling price of Hirst was directly attributable to the imported best prices for goods by the Applicant. (ix) The Respondent in fixing the non-injurious price failed to reconvert Belgium francs to Australian dollars at the same exchange rate used initially to undertake the conversion from Australian dollars to Belgium francs. (x) The Respondent assessed the price injury in the Australian domestic market without regard to the evidence of the impact on domestic pricing caused by a fluctuating exchange rate and therefore erroneously concluded that any downward pressure on domestic pricing was solely attributable to the imported price of the Applicant. (xi) There was no evidence of reduction in prices offered by AMOCO to any Australian carpet manufacturers. (xii) The Respondent was not on the only evidence available justified in attributing any price pressure on the relevant Australian market to the Applicant's importation of goods, given the manner in which price setting occurred in the Australian industry which was unrelated to the importation of goods by the Applicant. (xiii) The Respondent failed to take into account the undisputed evidence that any injury to the Australian industry was not due to the importation and sale of the goods in question by the Applicant, but rather the Australian industry price having been set at a level by reason of the availability to the two major manufacturers in Australia using the goods of Global Purchasing Power and their ability to demand world best prices or world best competitive prices. (xiv) There was no evidence to support a finding of material injury having been caused by price injury. (xv) The Respondent failed to take into account the undisputed evidence that:- (a) The Applicant's prices did not fall during the period under review, but increased. (b) The Applicant did not quote any sale prices to show in the period under review. (c) The sale prices to other Australian carpet manufacturers did not decrease during the period under review." Most of these particulars were not at least explicitly pursued in the submissions of the Applicant. 37 The particulars of the causes of action pleaded in paragraph (iii) of [35] above, as set out in par 11B of the S/C, were as follows: "(a) In fixing the non-injurious price the Respondent converted Australian dollars to Belgium francs at one exchange rate and reconverted Belgium francs to Australian dollars at a different exchange rate. (b) The establishment of non-injurious price by the ACS and adopted by the Respondent failed to take account of the undisputed facts that the Applicant exported three different specifications of backing fabric, each of which has a different production cost and in ascertaining export price the ACS and the Respondent admittedly fixed the export price and duty by reference only to the highest WEFT yarns per/10 cm, namely 64 and 71/10 cm without any regard to LOWER WEFT YARNS." However neither of the issues raised by par 11B of the S/C were developed by the Applicant's submissions, in circumstances where any meaningful consideration could have been afforded thereto. I have not therefore addressed those latter purported issues. 38 The S/C further pleaded that subsequent to the review undertaken by the Trade Measures Review Officer, and that Officer's recommendation being forwarded to the Minister, the Applicant was not accorded natural justice within s 5(1)(a) of the ADJR Act, in that following the review undertaken by the Trade Measures Review Officer and the recommendations of that Officer being forwarded to the Minister, the Minister did not, as required by s 269ZZL of the Act, accept the recommendation of the said Officer, and in so doing relied on evidence provided by the ACS prior to the review to establish "normal value" within s 269TG of the Act, without according to the Applicant the right to make submissions, or to provide evidence, and the Minister did not provide to the Applicant the further evidence relied upon, and to that extent was in breach of the rules of natural justice within s 5(1)(a) of the ADJR Act. These matters also were not purportedly pursued in the submissions of the Applicant. 39 The responses of the Minister by the Amended Defence to the particulars to the S/C set out in [36] above comprised mainly joinders of issue, and otherwise as follows: (i) As to sub-pars (iv), (v), (x) and (xii), the matters there particularised by the Applicant related only to the merits of the decision, and were not relevant to an available ground for review; (ii) As to sub-par (vii), it was admitted that one of the findings of the ACS in the Trade Measures Report No 1, upon which the Minister relied, was that the prices paid to AMOCO by Shaw were influenced by prevailing competitive prices; however the relevant findings of the Report identified the price of imported fabric, which included the Applicant's exported goods, as a factor in the price paid to Amoco by its major customers; (iii) As to sub-par (viii), it was admitted that one of the findings of the ACS in the abovementioned Report, upon which the Minister relied, was that the price obtained by Amoco in its sales of product to Hirst was determined by the price achieved in sales of the same product by Amoco to Shaw, and further that the relevant findings in the Report identified sales of exported goods by the Applicant as a factor reducing the price achieved by Amoco in its sales of the same product to Shaw, and it was otherwise denied that the identification of the causal link there referred to by the Applicant was unreasonable; (iv) As to sub-par (ix), the same had no bearing upon the question whether there was evidence or other material to support the Minister's conclusion on material injury, and further, that there was a difference between the exchange rates used to convert export prices into Belgian francs (so as to allow comparison with normal values) and the exchange rates used to convert the relevant normal values into Australian dollars; (v) As to sub-par (xiii), it was denied that there was 'undisputed evidence' to the effect set out therein; (vi) As to sub-par (xv), it was not admitted by the Minister that the matters therein referred to were matters required to be taken into account by the Minister; in any event as to sub-par (xv)(a), it was denied that there was any failure to take into account the matters referred to, and as to sub-pars (xv)(b) and (c), it was not admitted that there was any failure to take into account the matters referred to, and otherwise sub-par (xv) was not admitted. 40 The complexity of the pleadings was alleviated by the written and oral submissions of the Applicant, which I will now examine. I have found it necessary to outline the pleadings in some detail, because the Applicant did not appear to abandon any of the grounds for review propounded thereby, though the dominant emphasis of the Applicant in its submissions was placed upon the issue as to absence of "causal link" elaborately particularised in [36] above. Submissions of the Applicant 41 The Applicant placed emphasis on the presence, within the text of subs 269TG(1) of the Act (see again [1] above), of the words "because of that", and "has been or is being caused", and submitted that what was thereby required was a causal link between the export price exceeding the normal value and also material injury thereby caused, the sub-section being said to thereby comprise "two causation factors". 42 The Applicant referred to the following decisions of this Court where the phrase "by reason of" appearing in statutory contexts fell for consideration. The first was Vickers v Minister for Business and Consumer Affairs (1982) 43 ALR 389, where the legislative provision under consideration was subs 229A(2) of the Act containing the following: "This section applies to – (a) moneys or goods in the possession or under the control of a person, being moneys or goods that came into his possession or under his control by reason of: (i) his selling or otherwise dealing in… narcotic goods imported into Australia…; (ii) his importing, or his agreeing to import, narcotic goods…" At 407, Morling J construed the expression "by reason of", where used in that statutory context, as demonstrating that "the relationship need not be direct", though nevertheless implying "a relationship of cause and effect between the sale or dealing in narcotics and the possession of the bank account". In examining the same legislative text in Kanbur Pty Ltd v Adams (1994) 55 ALR 158 at 172, McGregor J was of the opinion that the expression envisaged the possibility of and included a more remote relationship or chain of causation between the conduct addressed in par (a) of subs 229A(2) and the attainment of possession or control. The Applicant thirdly cited dictum of Jenkinson J in Kimberly-Clark Ltd v Commissioner of Patents (1988) 84 ALR 685 at 695, in the context of subs 160(2) of the Patents Act 1952 (Cth), where his Honour said that the phrase "by reason of" where therein appearing "implied a relationship of cause and effect which may be indirect". Notwithstanding these authoritative judicial observations upon analogous legislative phraseologies, the Applicant submitted that the expression "is being caused", where appearing in subs 269TG(1) (extracted at [1] above), required "a more direct relationship". 43 Having thus emphasised the notion of causation contained in subs 269TG(1), the Applicant advanced the main theme of its contentions to the effect that even if material financial injury had been sustained by Amoco in the conduct of its operations, any such injury had not been caused by any conduct of the Applicant, nor did injury result by reason effectively of the export price. Any such injury, so the Applicant's submissions continued, was caused by reason of the demand of the two largest carpet manufacturers in Australia (ie Shaw and Hirst) from Amoco of "world best prices" or "world competitive prices" (being the expressions appearing in [12] above), for the sale by Amoco of carpet backing fabric, and not because of the export price. In response to the Minister's contention that the grounds for review propounded by the Applicant constituted on true analysis merely an attack upon the merits of the Minister's decision, and lacked a justiciable basis, the Applicant submitted that the only reasonable finding open to the Minister on the evidence was that any material injury to the Australian Industry was not caused by Polyweave's conduct or because of its export price, but by Shaw and Hirst "in their dealings with Amoco". 44 The Applicant thereafter isolated the following aspects of what it contended to be the material findings of the Trade Measures Report No 1: (i) Amoco is the sole manufacturer of carpet backing fabric in Australia (see [7] above). (ii) Over 70% of the market demand for the acquisition of carpet backing fabric in Australia is controlled by Hirst and Shaw, who purchase most of their requirements for carpet backing fabric from Amoco (see [4] and [20(i)] above). (iii) The Applicant's share of the total Australian market for carpet backing fabric is only 10.2% (see [7] above). (iv) Polyweave exports its carpet backing fabric to Australia at arms length to Australian carpet manufacturers (see [8-9] above). (v) The ACS did not find the existence of sufficient evidence to support the Amoco claims of injury in the form of lost sales, reduced investment or reduced employment levels (which I interpolate to mention was correct), though the ACS accepted that there were findings of the ACS in relation to price suppression, price depression and price undercutting, with flow on effects to profits and profitability (see [11] above). (vi) Shaw's insistence on receiving "world's best price" or "world competitive prices" from Amoco was what caused Amoco to reduce its prices to Shaw, and Hirst only agreed to increase its purchases from Amoco on the basis of receiving reductions in price to the same level granted by Amoco to Shaw (see [12] above). To cite the Applicant's oral submissions, there was ample evidence in the ACS material to prove that because of their acquisition of dominance in the carpet manufacturing market in Australia, Hirst and Shaw caused all of Amoco's problems, that is to say, its loss of the higher prices previously attainable by Amoco, with consequential loss of profits, because of the dominance which Hirst and Shaw had been able to exert in the market for carpet backing fabric for the purpose of manufacturing carpets in Australia. (vii) Some injury to Amoco had been conceivably sustained, but that injury had been caused by Hirst's actions above stated; Shaw had not replaced its purchases of Amoco product with lower priced imports, but on the contrary had increased its sourcing from Amoco (see again [12] above). (viii) Amoco is "the major source of the second tier manufacturers" for carpet backing fabric in Australia (see again [11-12] above). (ix) ACS had [at least] concluded that Amoco had not suffered injury overall from loss of sales in the sense of loss of transactions of sale (I refer to [13-14] and [17-18] above), which the Applicant contended to be the true explanation for the process of reasoning which led to the finding in the last paragraph of the Trade Measures Report No 1 extracted in [14] above). (x) Whilst the ACS found the occurrence of injury to Amoco to be due to loss of profitability (see [15] above), the basis for such injury could only have been because of the conduct in the market of Hirst and Shaw, since the overall sales (the Applicant's emphasis) made by Amoco had increased, and the only reasonable conclusion for that injury to Amoco was, to cite the Applicant's submission, "… that the word's best price demands by Hirst and Shaw caused this, partly no doubt because Hirst increased its purchases but demanded better prices, as did Shaw". 45 The submissions of the Applicant in relation to the findings of the Trade Measures Report No 1 (and as to the subsequent confirmation of those findings of 19 August 1999 as set out in [34] above), were concluded in the following terms, which it is appropriate I cite verbatim: (i) "It is obvious from the above that the evidence clearly demonstrated (without evidence to the contrary) that if Amoco suffered injury due to reduced profitability, it was not caused by the Applicant or because of the Applicant's export price". (ii) "Customs, having concluded (as to causation of material injury) that all (the emphasis of the Applicant) of the injury was traceable to price and that the increase in sales to Hirst was only negotiated because of reduced price, ie not relevant to the Applicant's exports, the only possible (reasonable) finding was that causation had not and could not be established so far as the Applicant is or was concerned". (iii) "Shaw and Hirst buy the carpet backing and use it to make carpet. It's an essential element in the manufacture of carpet of this nature. So they had an option, they can buy off persons who export the goods into Australia or they can buy off Amoco, and the evidence is that Amoco probably did suffer some price injury because it reduced its prices but did not reduce its prices because of any client's exports, it was forced to do so by Hirst and Shaw who virtually said they would not deal with them unless they offered world competitive price, and because 70 per cent of the market is controlled by Hirst and Shaw, they could really demand what they wanted. Indeed during the relevant period because Amoco agreed to reduce its prices, its sales in terms of volume actually increased". Such submissions were made mutatis mutandis in relation to the Minister's subsequent decision-making of 19 August 1999 referred to in [34] above. 46 The Applicant then undertook the task of basing those submissions within any one or more of the statutory grounds set out in [35] above. The primary basis which the Applicant pursued was the "no evidence" ground provided by s 5(1)(h) of the ADJR Act, namely "that there was no evidence or other material to justify the making of the decision", concerning which in Australian Broadcasting Tribunal v Bond (1990) 170 CLR 321 at 358, Mason CJ (with whom Brennan J agreed) said as follows, at the conclusion of his examination of the "no evidence" ground at common law, and the interaction of s 5(1)(h) and the preceding s 5(1)(f) of the ADJR Act: "The better view, one which seeks to harmonize the two grounds of review, is to treat 'error of law' in s 5(1)(f) as embracing the 'no evidence' ground as it was accepted and applied in Australia before the enactment of the [ADJR] Act and to treat the 'no evidence' ground in s 5(1)(h), as elucidated in s 5(3), as expanding that ground of review in the applications for which pars (a) and (b) of s 5(3) make provision. Within the area of operation of par (a) it is enough to show an absence of evidence or material from which the decision-maker could reasonably be satisfied that the particular matter was established, that being a lesser burden than that of showing an absence of evidence (or material) to support the decision." The Applicant further sought to rely upon what was said by Deane J in Bond at 366: "If the actual decision could be based on considerations which were irrelevant or irrational or on findings or inferences of fact which were not supported by some probative material or logical grounds, the common law's insistence upon the observance of such a duty would represent a guarantee of little more than a potentially futile and misleading facade…" 47 The major hurdle however which the Applicant was required to address in the proceedings, given the Applicant's acceptance of the finding of the ACS in the Trade Measures Report No 1 (and subsequently of the Minister in her letter of 19 August 1999) that Amoco had suffered "price injury" in the nature of loss of profits, was to establish that the cause of that loss of profits was not that which was found by the ACS, and confirmed by the Minister, by way of dumping of product in the Australian market, by inter alia Polyweave, but rather the market play of Shaw and Hirst in demanding so-called "world best" or "world competitive" prices (see [23-26] above and the Minister's letter of 19 August 1999 to the extent extracted in [34] above). 48 The Applicant further invoked s 5(1)(e) of the ADJR Act concerning an improper exercise of power, by reason of an exercise on the part of the Minister of power that was said to have been so unreasonable that no reasonable person could have so exercised the same (see s 5(2)(g) of the ADJR Act), and in that regard the Applicant placed reliance upon the following dicta of a Full Court (comprising Davies, Burchett and Lee JJ) in Minister of State for Immigration, Local Government and Ethnic Affairs v Pashmforoosh (1989) 18 ALD 77 at 80: "Federal legislation emphasises the need for reasoned decision-making… decisions may be set aside because, being insufficiently supported by reason, they appear to be an improper exercise of the power conferred or arbitrary or because there was no evidence or other material sufficient to justify the making of the decision or the decision was so unreasonable that no reasonable person could have so exercised the power. The making of, or failure to make, a particular finding of fact in the course of the reasoning process may equally be attacked on any such ground. The taking into account of a fact found unreasonably or the failure to take into account a fact that a reasonable decision-maker would have found and taken into account provides a ground for review under ss 5(1)(e) and 5(2)(a) and (b) of the ADJR Act." I should mention for completeness that in Bond at 359, Mason CJ observed, in relation to the preceding passage extracted from Pashmforoosh, that the sentence "[t]he making of, or failure to make, a particular finding of fact in the course of the reasoning process may equally be attacked on any such ground" needed to be qualified to the extent that "… if the finding does not constitute a 'decision', it is beyond review independently of such a 'decision'." The Applicant also cited dictum of Pincus J in Detsongjarus v Minister for Immigration, Local Government and Ethnic Affairs (1990) 21 ALD 139 at 140-141, where the following passage appears: "… it has become clear that the ground of unreasonableness can be used in attacking factual views of the decision-maker leading up to the exercise of power which is the subject of the application to the court… Apart from providing (by a combination of s 5(1)(e) with s 5(2)(g)) for a review of decisions on the ground of unreasonableness, the Judicial Review Act permits them to be reviewed on the ground of error of law and this brings in unreasonableness by another door: see s 5(1)(f) and (j)." 49 The Applicant submitted that the Minister's decision was all the more unreasonable, within the statutory framework of s 5(1)(e) in combination with s 5(2)(g) and additionally within the common law framework of the Wednesbury principle, in purporting to conclude upon causation of injury referrable to the Applicant's export price to Australia, in circumstances where the Minister's reasons or reasoning on the point was said to have been dealt with in three short paragraphs in the Minister's letter of 19 August 1999 to the Trade Measures Review Officer (extracted in [34] above under the Minister sub-heading "Belgium Polyweave"), because "no process of reasoning is evident, no facts are expressed as having been accepted or otherwise", and additionally because "[t]here are no apparent inferences drawn and the reasoning does not alter… the uncontested evidence (and the findings of the ACS itself)" in relation to the "real cause" constituted by "the position of Hirst and Shaw in the market and their market power". On that footing, the Applicant further submitted that the reasoning of a Full Federal Court (Gummow, Hill and O'Connor JJ) in Enichem Anic Srl v Anti-Dumping Authority (1992) 39 FCR 458 at 469-471 was distinguishable, because "[w]hilst that case touched upon the issue of causation it did so in a context which is completely different from the instant Application proceedings", and because "in Enichem's case there was no evidence of any other possible cause let alone direct evidence of the actual cause". It is therefore appropriate that I set out the essence of the reasoning in Enichem which the Applicant's contentions purported to address. After referring to what the Full Court described as a similar argument rejected earlier by Sheppard J in Feltrex Reidrubber Ltd v Minister for Industry and Commerce (1983) 67 FLR 32 at 45-47, the judgment of Hill J (with whom Gummow and O'Connor JJ agreed) at 470 proceeded as follows: "Such strength as there is in the argument is to be found in the undoubted fact that s 269TG(1) refers to particular goods, that is to say the goods of the particular manufacturer, and that the provisions of s 8 of the Anti-Dumping Act operate to charge the dumping duty upon the particular goods to which that section applies by force of the declaration made under s 269TG(1). That this is so is reinforced by the fact that the amount of the duty is equal to the difference between the export price of the particular goods and the normal value of the same goods. Once this is accepted it is but a short step, so it was submitted, to a conclusion that the causal link required by the terms of s 269TG(1) is between the individual exporter into Australia and the damage or threatened damage to the Australian producers. The "loophole" to which Sheppard J referred is demonstrated by an example given by his Honour at 45-47. His Honour postulates that a supplier to the market with 25 per cent of the market might alone have power to damage or threaten damage to the Australian suppliers in that market, but that one of five suppliers, each with five per cent, on its own might not have that power. However, it would not follow from this that dumping action could not be taken against each of the five suppliers. The reason is quite simple. In a case where the five suppliers viewed together would damage or threaten the Australian suppliers, the action of each of those suppliers, in exporting at dumped prices to Australia, may be said to damage or to threaten damage to the Australian suppliers. The determination of causation, like determination of the existence of "material injury", is to use the words of Lockhart J in Swan Portland Cement Ltd v Minister for Small Business and Customs (1991) 28 FCR 135 at 144: 'essentially a practical exercise designed to achieve the objective of determining whether, when viewed as a whole, the relevant Australian industry is suffering material injury from the dumping of goods.' A case may arise where the percentage of the market held by a particular exporter is so insignificant that to reach a conclusion of causality would be irrational, having regard to the percentages held by other exporters who are dumping goods into Australia. In such a case, a finding of causality would necessarily fail. But that is not the present case. Here, the exporters found to be dumping goods were aggregated and the combined effect of their dumping was considered by the decision-makers in resolving the question of damage or threatened damage to Australian producers. That approach of itself involved no error of law. The percentage of the market held by the goods of the appellants was not insignificant. The finding of causality was not unreasonable and it has not been shown that there was any error of law involved." In the light of that approach adopted by the Full Court in the not dissimilar circumstances involved in Enichem, Counsel for the Applicant conceded that the ACS and the Minister could take account of the aggregate effect of all of the exports of carpet backing fabric into Australia during the material periods of time. Counsel accepted that "the aggregate effect of all of the exports… wasn't specific to my client, it was specific to all imports, so that we accept the test and that's in fact what Customs has undertaken", but further submitted that "What our complaint is that when one looks at all of the importers as a whole, the evidence of Customs itself in its own report establishes that any price problems were because of Shaw and Hirst, so that any injury wasn't caused by the importers either individually or as a whole". Submissions of the Minister and the Court's conclusions 50 Senior Counsel for the Minister made the preliminary submission that the exercise of the powers conferred upon the Minister by s 269TG of the Act (extracted in [1] above) depends on the Minister's satisfaction that dumping has occurred, and has caused, or is in the process of causing, material injury, and further that it is that state of satisfaction that enlivens the Minister's statutory powers, and not the objective existence of any underlying set of facts that might be independently established. Thus the Court's concern in terms of principle, in undertaking judicial review of a decision made under s 269TG of the Act, is whether the Minister has reached his or her state of satisfaction on the right questions, and otherwise according to law, and not whether, as an issue of fact, dumping has occurred and caused material injury to an Australian industry. Therefore the task of making findings about the causes of material injury is one for the Minister and not for the Court, and involves "essentially a practical exercise", to cite the dictum from Swan Portland Cement applied in Enichem in the passage extracted at [49] above. As was said by Burchett J in Mullins Wheels Pty Ltd v Minister for Customs and Consumer Affairs (1999) 166 ALR 449 at 457: "The proposition, that the finding of a causal link between a dumping that is shown and a material injury to the Australian industry that is shown is very much a practical exercise, is in accordance with general statements of principle to which the High Court of Australia has consistently adhered for a long time." 51 Reference was next made to the Minister's letter of 19 August 1999 to the Trade Measures Review Officer (the material parts whereof relating in particular to Polyweave have been reproduced in [34] above), and pointed out that the same were couched in terms which made it clear that she was thereby rejecting criticisms of the reasoning of the Trade Measures Report No 1 advanced by the Trade Measures Review Officer of the Attorney-General's Department, being the criticisms set out in the document dated 7 May 1999 reproduced in [31] above, and accepting the response of the ACS contained in its Minute Paper of 30 July 1999 extracted in [33] above. Thereafter the Minister confirmed or ratified her previous decision to make the declarations pursuant to subsections (1) and (2) of section 269TG, which are set out in [30] above. Senior Counsel summarised the essence of the factual findings of the Trade Measures Report No 1, and of the subsequent ACS confirmation thereof by the Minute Paper, as follows: (i) Amoco, the sole Australian manufacturer of primary carpet backing, had been forced to lower its prices in order to avoid losing sales; (ii) One of the two major purchasers (Hirst) had agreed to continue (indeed increase) its purchases from Amoco on the footing that it would pay the same prices as the other major purchaser (Shaw); (iii) Shaw (like other customers) regarded price as the most important factor in its purchasing decisions (assuming the competing products met its needs in terms of specification and quality), and thus took account of prevailing competitive prices when making its decisions; (iv) the prices of imported backing were therefore an important factor in determining the prices which Shaw (and in consequence Hirst) was prepared to pay Amoco; (v) a significant proportion of the imported backing was found by Customs to have been sold at dumped prices; (vi) depression of Amoco's prices had therefore occurred because of the dumping of imported backing; (vii) that depression amounted to "price injury" which was "material"; and (viii) all of the exporters who were found to have engaged in dumping had contributed to this injury. In so doing, Senior Counsel accepted on behalf of the Minister that subs 269TG(1) required the Minister to be satisfied as to the existence of a causal link, being a satisfaction which she was entitled however to adopt in the light of the circumstances set out in (i) to (viii) above. In so doing, whilst rejecting the suggestion of the Applicant that the presence of the words "caused by" and "occurred because of" (see again the extract of the subsection in [1] above) demanded some element pointing to the need for a more direct link, Senior Counsel for the Minister contended that if anything, those two statutory concepts of causation, when read together, implied something less than merely "caused by". For what it may ultimately matter, I think that s 269TG merely imposes two links in the statutory chain of causation, rather than a single link, but that it nevertheless speaks in terms of "causal link". In any event, I think that the Minister's approach, rather than that of the Applicant, is assisted by the authorities cited in [42] above. 52 The Minister's foregoing summary of the findings of the Trade Measures Report No 1 accurately reflects in my opinion the more detailed summary of those findings, which I have set out at length from [7] to [22] above. As that summary demonstrates, what happened against the background of evolution of the rationalisation of the Australian market for carpets was the expansion in size of the operations of the largest Australian carpet manufacturers Shaw and Hirst to a situation of market dominance shared between them in the order of 70 of the total carpet market, and as a consequence, an increase in their respective market strengths or powers to require so-called "world's best price" or "world competitive price" for the supply of carpet backing fabric from Amoco for assembly in their carpets. Shaw initiated that process of price demands upon Amoco, and Hirst thereafter required of Amoco that Hirst receive similar pricing advantage to that being extended to Shaw, in return for Hirst's patronage of Amoco. The "world's best price" or "world competitive price" for carpet backing fabric translated in reality into, and was reflected in, the price levels which were attributable to the product being dumped in Australia by each of the five overseas exporters, including Polyweave. Responding to the respective price demands of Shaw and Hirst as the major carpet manufacturers in Australia effectively compelled Amoco to reduce its selling price of carpet backing fabric to each of them at levels which occasioned to Amoco reductions in its profit levels, and hence so-called "price injury". The equivalence of "world best price" or "world competitive price", as charged by those overseas based exporters, represented export prices for carpet backing fabric less than "the amount of the normal value of those goods" within s 269TG(1)(a) of the Act. 53 Whilst it may have been open to Amoco to decline the demands of Shaw and Hirst for "world's best price" or "world competitive price", the euphemisms for the Australian dumped price, by confining the outlets for its manufactured product to the so-called second tier manufacturers, that course would have been hardly a realistic trading option in the pressured and uncertain world of relatively free market choice, in circumstances where the main volume of business was represented by the dominance of Shaw and Hirst. Inherent in the reasoning of the ACS was that conclusion. Putting the ACS findings another way, whilst in the ebb and flow of competitive business, Amoco was able to maintain the approximate volume of its merchandising operations by the course it took, it found itself compelled to do so at pricing levels dictated by the dumped prices of the overseas suppliers for product readily available in the Australian market, which necessarily involved in turn a decline in the price, and consequently in the profit margin, obtainable by Amoco for its local product. The assertion of the Applicant recorded in [49] above that "any price problems were because of Shaw and Hirst, so that any injury wasn't caused by the importers either individually or as a whole", fails to come to terms with the critical theme of the Trade Measures Report No 1 that it was the dumped prices which enabled Shaw, and as a consequence Hirst, to make its demands of Amoco for supply at the so-called "world best prices" or "world competitive price", the euphemistic description in reality of dumped prices brought about by the export activities of the five exporters including Polyweave. In terms of causation, the circumstances of causation were comparable to those in Enichem described in [49] above. 54 The Applicant conceded that the market prices of carpet backing fabric in Australia at the material times, except of course the product merchandised by Amoco as the sole Australian manufacturer of that product, constituted dumped prices. It was in that context that the Applicant sought to contend that it was not the cause of Amoco's "price injury" or loss of profitability, being a contention contrary to the finding made by the Minister upon the footing of the ACS reports and submissions. Whether the adoption by the Minister of that finding might have been in truth right or wrong it is not to the point; the finding was reached by the ACS as a consequence of a "practical exercise" which it undertook by way of a lengthy investigation (the expression "practical exercise" being postulated in dictum in Swan Portland Cement Ltd v Minister for Small Business and Customs (1991) 28 FCR 135 at 144 forming in part the passages from Enichem which I have extracted in [49] above). 55 It was in my opinion plainly open to the Minister as decision-maker to accept the factual findings and implement the consequential recommendations of the Trade Measures Report No 1 of the ACS, not just concerning material injury by way of loss of profit sustained by Amoco caused by the dumping activities inter alia of Polyweave, but also to recognise the likelihood of those dumping activities continuing, as found in that Report and summarised in [25-26] above. In so doing, the Minister was entitled to approach the task on hand "as a practical exercise" (see again the passages in Enichem and Mullins extracted in [49-50] above). Consequently it was open to the Minister, according to the law of administrative review, to accept and implement the recommendations of the Trade Measures Report No 1 enumerated in [28-29] above. Nor is there any sound reason according to the law of administrative review why it was not open to the Minister to reject the subsequent submissions of the Trade Measures Review Officer of the Attorney-General's Department, to which I have made extensive reference in [31-32] above, after having first given consideration thereto, albeit in the light of the subsequent report of the ACS which has been extracted at [33] above. The Minister's communication extracted at [34] above demonstrates the giving of such consideration. 56 Senior Counsel for the Minister has specifically addressed, in terms of those paragraphs of subs 5(1) and (2) of the ADJR Act relied upon by the Applicant, the submissions of the Applicant, which I will record and in relation to which I will express my conclusions. 57 First as to the "no evidence" ground of review the subject of ss 5(1)(h) and 5(3)(a) of the ADJR Act, the Minister has correctly observed that when s 5(3)(a) speaks of a matter being "established", it means that the matter is required to be established to the satisfaction of the Minister as decision-maker, and that the matter here involved was whether "material injury" had occurred or was occurring "because of" the dumping of goods in Australia: see subs 269TG(1) extracted at [1] above. The material placed before the Minister, for the purpose of making her initial decision to impose or not to impose measures, was the Trade Measures Report No. 1 and its appendices, the responsibility for preparation whereof having been imposed upon the Chief Executive Officer of Customs pursuant to s 269TEA of the Act (extracted at [6] above and see also s 269TE, which imposes upon that Officer the obligation to have regard to the same considerations as the Minister). The Report concluded that material injury had occurred, which had been caused by the dumping of goods including those of the Applicant, and set out the reasoning that led to those conclusions, including in broad terms the sources of information upon which that reasoning process was based. The Report was therefore "material" from which the Minister could reasonably conclude that the "matter" of causation of material injury was established, and accordingly the ground of review provided for in s 5(1)(h) and s 5(3)(a) was not made out. The Minister referred in the foregoing context specifically to Chapter 7 of the Report, which I have summarised in [19-26] above, and to the principle that where a report deals with all the issues required to be addressed, the decision-maker who receives the same is, generally speaking, not required to go beyond it: Minister for Aboriginal Affairs v Peko-Wallsend Ltd (1986) 162 CLR 24 at 30-31 (Gibbs CJ), 46 (Mason J) and 65-66 (Deane J). In any event, it was contended that the Applicant's submissions related only to the sufficiency of the material upon which the ACS conclusions, underlying its recommendations to the Minister, were based. If there was any other evidence suggesting different conclusions, that would not have assisted the Applicant in principle in establishing the "no evidence" ground for review. In my opinion, the foregoing submission of the Minister is sound. 58 Secondly as to the s 5(1)(f) ground for review, which as I have earlier indicated entered the debates below, albeit not pleaded in the S/C, the Minister referred to the discussion of the Chief Justice in Bond at 358, which I have extracted in [46] above, and submitted that there was material before the Minister in the form of the Trade Measures Report No 1 which was capable of supporting the conclusions to which the Minister came. I think that the Minister was correct in his contention that the Applicant's complaint was that the reasoning which the Minister accepted was illogical. 59 Thirdly as to the s 5(1)(e) ground for review, in combination with the s 5(2)(a) and s 5(2)(b) grounds, which the Minister suggested might be seen as species of irrationality, in that they allege a miscarriage in the decision maker's thought processes (see Judicial Review of Administrative Action (Aronson and Dyer) (2nd ed 2000) (Ch 6)), the Minister submitted that the essence of these grounds of review was an alleged failure by the Minister to address the question or questions which the legislation requires to be addressed, in the sense of "jurisdictional error" (Minister for Immigration and Multicultural Affairs v Yusuf (2001) 180 ALR 1 at [82] (McHugh, Gummow and Hayne JJ) (Gleeson CJ agreeing), and further that the same could not be used as a cover for challenging the factual correctness of a decision (Mendoza v Minister for Immigration, Local Government and Ethnic Affairs) (1991) 31 FCR 405 at 420). All that apart, the Minister submitted that the Applicant's present attack was directed to the Minister's conclusion as to causation, which is essentially an issue of fact, and precisely the issue which ss 269TG(1)(b) and (2)(b) of the Act require the Minister to consider, and I was referred in that context concerning causation to Bennett v Minister of Community Welfare (1992) 176 CLR 408 at 412 (Mason CJ, Deane and Toohey JJ). In my opinion, at least the latter submission is correct, and it is unnecessary for me to resolve the former. The weight to be given to evidence, and the conclusions to be drawn from it, were matters for the Minister, not for the Court. In the present case, what the Minister was bound to consider was whether the conceded conduct in the nature of dumping had caused, or threatened to cause, "material injury" to the Australian industry, and in forming her opinion on the factual question of causation, it cannot be correctly said that the Minister was bound to take into account, or to give weight to, any particular evidentiary material. Moreover I should add that the Applicant did not appear to specify what were the irrelevant considerations which the Minister supposedly took into account for the purposes of s 5(2)(a) of the ADJR Act. Its complaint was rather about the way in which the Minister dealt with the issues required to be addressed by s 269TG of the Act. 60 Fourthly as to "unreasonableness", whether within s 5(2)(g) of the ADJR Act or the common law Wednesbury principle, the Applicant's allegation was that unreasonableness had occurred, not in the bringing to bear of factors in the exercise of a discretion, but in the formation of a state of satisfaction which formed the precondition for a discretion to arise. I was referred by the Minister to the following passage in the joint judgment of Gleeson CJ and McHugh J in Minister for Immigration and Multicultural Affairs v Eshetu (1999) 197 CLR 611 at [40]: "Someone who disagrees strongly with someone else's process of reasoning on an issue of fact may express such disagreement by describing the reasoning as 'illogical' or 'unreasonable', or even 'so unreasonable that no reasonable person could adopt it'. If these are merely emphatic ways of saying that the reasoning is wrong, then they may have no particular legal consequence." and where approved was then extended to dictum of Lord Brightman in Puhlhofer v Hillingdon London Borough Council [1986] AC 484 at 518. 61 The application must be dismissed. I certify that the preceding sixty-one (61) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Conti. Associate: Dated: 16 April 2002 Counsel for the Applicant: K Varley Solicitor for the Applicant: Carter Green & Co Counsel for the Respondent: N Hutley SC and G Kennett Solicitor for the Respondent: Australian Government Solicitor Date of Hearing: 11-12 December 2001 Date of Judgment: 16 April 2002