G/SG/N/10/THA/2/Suppl.2  
G/SG/N/11/THA/2/Suppl.4  
 
6 January 2016  
(16-0084)  Page: 1/6  
Committee on Safeguards  Original: English  
 
NOTIFICATION OF A PROPOSAL TO EXTEND A MEASURE 
 
NOTIFICATION PURSUANT TO ARTICLE 9, FOOTNOTE 2, 
OF THE AGREEMENT ON SAFEGUARDS 
THAILAND  
(Hot Rolled Steel Flat Products with Certain Amounts of Alloying Elements) 
Supplement 
The following communication, dated 29 December 2015,  is being circulated at the request of the 
Delegation of Thailand.  
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With reference to Thailand's notification on the initiation of a review pursuant to Article 7.2 of the 
Agreement on Safeguards regarding the extension of the safeguard measure (WTO Document G/SG/N/6/THA/2/Suppl.1-G/SG/N/14/THA/2) dated 27 July 2015, Thailand hereby provides 
notification to the Committee on Safeguards pu rsuant to Article 12.1(b) of the Agreement on 
Safeguards, on its proposal to extend a safeguard measure that is being applied against imports of 
hot-rolled steel flat products with certain amounts of alloying elements.  
Consistent with Article 12.2 of the Agreement on Safeguards,  this notification contains all pertinent 
information relating to the proposal to extend the safeguard measure on product concerned.  
1  THE SAFEGUARD MEASURE CONTINUES TO BE NECESSARY TO PREVENT OR REMEDY 
SERIOUS INJURY OR THREAT THEREOF CAUSED BY INCREASED IMPORTS AND THERE IS EVIDENCE THE INDUSTRY CONCERNED IS ADJUSTING  
a. Basic Industry Indicators 
Item 2011 2012 2013 2014 2014 
(Jan-Jun) 2015 
(Jan-Jun) 
Sales (MT)* 100 95.65 88.23 83.49 100 98.19  
Market share (%) 80 66 86 92 93 89  
Import Share (%) 20 34 14 8 7 11  
Consumption (MT)* 100 115.82 81.63 72.27 100 102.66  
Production (MT)* 100 89.78 88.79 83.40 100 92.87  
Capacity Utilisation (%) 40 36 36 34 33 31  
Productivity (%) 96 96 96 98 97 97  
Profit/Loss (million baht) (2,868) (7,573) (3,431) (2,677) (888) (2,844)  
Employment (number)* 100 90.82 89.00 95.08 100 105.02  
* Index: Year 2011 = 100 G/SG/N/10/THA/2/Suppl.2 • G/SG/N/11/THA/2/Suppl.4 
 
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In year 2011 and 2012, Imports of product conc erned dramatically increased inflicted serious 
injury on the domestic industry. Notably the mark et share of the domestic industry dropped from 
80% in year 2011 to 66% in year 2012 and the domestic industry faced 2.5 fold losses in 2012 
compared with the previous year. 
 Following the imposition of provisional measures  on 27 February 2013, the domestic industry was 
able to regain market share in 2013 and 2014 which resulted in a reduction of losses and 
stabilizing sales and production at a reduced level even though the domestic consumption moderately declined. Most importantly, one of the domestic-industry companies, G Steel PCL., was able to resume its production in April 2014 after it temporary shut down since mid-2012 due to its 
huge losses caused by the surge of imports of the product concerned before the measure was 
imposed.  
However, from January to June 2015, imports increased compared to the same period of 2014, 
and the market share of the domestic industry  declined even though consumption slightly 
expanded as imports increased both in absolute terms and relative to consumption. Although the 
sales slightly decreased the domestic industry encountered great losses compared with the same 
period in 2014, showing the devastation of its profit-making ability largely due to import prices that have remained well below those of the domestic industry.   
The authorities also considered factors other than increased imports that might be causing serious 
injury of domestic industry including the decrease of domestic demand caused by the effect of the 
global economic slowdown and Thai political unrest, management ability of the domestic industry, 
productivity of domestic industry, investment in SS I UK of Sahaviriya Steel Industry PCL., etc. by 
analysing each injurious indicator that may be affe cted by these factors. The authorities analysed 
those injurious effect so that any injury caused by these factors was not attributed to the flux of 
imports.  
 In fact, the domestic industry currently has 7.9 million tons total production capacity which is more than enough to meet the domestic de mand. Moreover, it maintains productivity 
(output/input) at the 96-98% level. Therefore, the lack of capability to supply the domestic 
demand is not the reason for the need of importation. In addition, the product concerned which had received special exemption i.e. for cold rolling process; for the automobile industry; for 
hardening process and as special grade steels granted to certain importers already precluded from 
this analysis.  
The above-mentioned demonstration showed the re medial effect of the safeguard measure in 
place and the linkage between imports of product concerned and injury of domestic industry.  
 
b. Condition of imports 
As imports increased in 2015, the ability to mainta in market share in spite of the measures in 
force was undermined largely due to imported prices of product concerned that were well below those of the domestic industry.  As a result, the domestic industry continued to face losses in 2013 
- 2014 and these tripled during January to June 2015 when imports started to increase once more. 
 
 
c. Evidence that the Industry concerned is adjusting 
The Committee on Safeguard Measure of Thailand appointed the working group of steel industry 
experts to closely monitor the adjustment plan in phase I and evaluated the achievement of the 
domestic industry. This working group will al so monitor the adjustment plan in phase II.  2011 2012 2013 2014 2014 
(Jan-Jun) 2015 
(Jan-Jun) 
Import Share (%) 20 34 14 8 7 11  
Profit/Loss (million baht) (2,868) (7,573) (3,431) (2,677) (888) (2,844)  G/SG/N/10/THA/2/Suppl.2 • G/SG/N/11/THA/2/Suppl.4 
 
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1. Initial Adjustment Plan for 2013 - 2015  (Phase I) 
Since February 2013 until September 2015 when the safeguard measure was in force, the 
domestic industry  exercised several programs aiming for the overall cost reduction, product 
development and production efficiency in order to increase its competitiveness. The programs 
included: 
 
a. Increase production efficiency including new machine installation, with the investment of 
over 240 million baht, for higher production within a shorten time;  
b. Cost reduction programs: the domestic industry exercised 25 cost reduction programs by 
investing over 87 million baht in the machine and equipment resulting in a cost reduction of over 1.3 billion baht; 
c. Product development: the domestic industry invested over 340 million baht for 
installation of new machine to produce thicker and wider products to meet customer 
specifications and expand new market segments. At this stage, focusing on product quality, several items of domestic products were accepted by the automobile industry as 
its approved source.   
2. Proposed Adjustment Plan for 2016 – 2019 (Phase II) 
After the huge investment in Phase I and several programs being underway, this second phase 
involves the continuous implementation of the programs in Phase I by lowering the production cost, increasing production efficiency, development of new product standards and grades to meet 
wider customers' expectation, improving the co mpetency of human resources especially in 
production control and improving customer satisfaction. 
In sum, Phase II of the adjustment plan involves  the investment by the domestic industry over 
1 billion baht which will result in cost reduction of almost the same level but which will improve the 
overall competency of the domestic industry.  
 
d. Public Interests  
During the course of the investigation, concern has been expressed that measures are against the 
public interest in that the safeguard measure will increase cost of production of the down steam 
productions. As a result, those products would not be able to compete with low price finishing product from China.  
In this respect, the authorities conclude that it is in the long term public interest to extend the 
temporary protection to allow the industry to complete the adjustment process and regain 
competitiveness so as to provide the consumer with a variety of quality products at a reasonable 
price.   
2  INFORMATION ON WHETHER THERE IS AN ABSOLUTE INCREASE IN IMPORTS OR AN 
INCREASE IN IMPORTS RELATIVE TO DOMESTIC PRODUCTION  
See points 1 (a) and 1 (b) above.  
 
3  PRECISE DESCRIPTION OF THE PRODUCTS CONCERNED 
The products concerned are hot rolled steel flat products with certain amounts of alloying elements 
such as boron, chromium, etc., in coils and not in  coils, with or without patterns in relief, of a 
thickness of 0.9 – 50.0 mm. and a width 100 – 3,048 mm. The products concerned are currently classified under the Thai Customs Tariff Code at 36 subheadings: 7225.30.90.011, 
7225.30.90.012, 7225.30.90.013, 7225.30.90.014, 7225.30.90.021, 7225.30.90.022, 
7225.30.90.023, 7225.30.90.024, 7225.30.90.090, 7225.40.90.011, 7225.40.90.012, 7225.40.90.013, 7225.40.90.014, 7225.40.90.021, 7225.40.90.022, 7225.40.90.023, 
7225.40.90.024, 7225.40.90.090, 7226.91.10.011, 7226.91.10.012, 7226.91.10.013, G/SG/N/10/THA/2/Suppl.2 • G/SG/N/11/THA/2/Suppl.4 
 
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  7226.91.10.014, 7226.91.10.021, 7226.91.10.022, 7226.91.10.023, 7226.91.10.024, 
7226.91.10.090, 7226.91.90.011, 7226.91.90.012, 7226.91.90.013, 7226.91.90.014, 7226.91.90.021, 7226.91.90.022, 7226.91.90.023, 7226.91.90.024, 7226.91.90.090, originating in or exported from various countries.  
 
4  IF THE FINAL MEASURE REPLACES A PROVISIONAL MEASURE, OR IF A FINAL MEASURE IS EXTENDED, A MEMBER IS ENCOURAGED TO PROVIDE A WRITTEN 
DESCRIPTION OF ANY PART OF THE IMPORT ED PRODUCT THAT WILL NO LONGER BE 
SUBJECT TO THE MEASURE  
Not applicable. 5  PRECISE DESCRIPTION OF THE PROPOSED MEASURE 
It is proposed that the safeguard measure continues to be necessary to prevent or remedy serious 
injury or threat thereof caused by increase imports while the domestic industry is adjusting.  
The proposed extended safeguard measure would be applied in the form of a tariff increase for 
three years starting from 27 February 2016 until 26 February 2019.   
In accordance with the relevant provisions of the Thai Safeguard Measures on Increased Imports 
Act B.E.2550 (2007), which refer to Thailand's obligations under Article XIX of the GATT and the WTO Agreement on Safeguards, the Committee on Safeguard Measures of Thailand has proposed to impose a safeguard duty which continues to be progressively liberalized during the proposed 
period of its vali dity as follows: 
 
Extended Duration Exte nded Safeguard Duty 
27 February 2016 – 26 February 2017 41.67% of C.I.F. price 
27 February 2017 – 26 February 2018 40.42% of C.I.F. price 
27 February 2018 – 26 February 2019 39.21% of C.I.F. price 
 
The proposed measure will not be applied against the products concerned originating in or exported from any developing country as long as its share of imports of the products concerned 
into Thailand does not exceed 3%. In this rega rd, there is no additional country exporting the 
product concerned more than 3% since the last WTO notification under Article 9 footnote 2 (WTO Document G/SG/N/10/THA/2/Suppl.1-G/SG/N/11/THA/2/Suppl.3 dated 6 November 2014), 
therefore the list of developing countries exclud ed from the proposed measure remains the same.  
 In addition, the exemption of imposition of the proposed extended safeguard measures will be 
granted to certain importers importing the products concerned into Thailand for cold rolling 
process; for the automobile industry; for hardening process and as special grade steels; and, 
import for export, i.e. the imported products that are intended to be manufactured, further processed or incorporated into a finished product that will be exported from Thailand under the 
Industrial Estate Authority of Thailand Act; or, the Investment Promotion Act; or, the Customs Act. 
 6  PROPOSED DATE OF INTRODUCTION OF THE MEASURE 
The proposed measure is expected to come into effect on 27 February 2016. 
 7  EXPECTED DURATION OF THE MEASURE 
The proposed safeguard measure adopted would be effective from 27 February 2016 until 
26 February 2019. 
 G/SG/N/10/THA/2/Suppl.2 • G/SG/N/11/THA/2/Suppl.4 
 
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  8  PROPOSED DATE FOR THE REVIEW 
Not applicable 
 9  INFORMATION RELATED TO THE PROPOS ED EXTENSION OF A SAFEGUARD MEASURE 
i. Evidence that the industry concerned is suffering serious injury and adjusting is provided 
under 1 (a) and (c) as mentioned above. Therefore, the safeguard measure continues to be necessary to prevent or remedy serious injury. 
ii. Reference to the WTO document that notified the initial application of the measure: 
- Initiation of the original investigation, G/SG/N/6/THA/2 (4 December 2012)  
 
- Imposition of provisional measures, G/SG/N/7/THA/2-G/SG/N/8/THA/2-G/SG/N/11/THA/2 
(13 February 2013) 
 
- Proposed definitive measure G/SG/N/7/THA/2/Suppl.2-G/SG/N/8/THA/2/Suppl.2-
G/SG/N/11/THA/2/Suppl.1 (2 August 2013) 
 
- Imposition of definitive  measure G/SG/N/8/THA/2/Suppl.3-G/SG/N/10/THA/2-
G/SG/N/11/THA/2/Suppl.2 (25 September 2013)   
 
- Notifications under Article 9 footnote 2, G/SG/N/7/THA/2/Suppl.1-
G/SG/N/8/THA/2/Suppl.1 (24 June 2013) and G/SG/N/10/THA/2/Suppl.1-
G/SG/N/11/THA/2/Suppl.3 (6 November 2014) 
 
iii. Duration of the proposed measure from initial application till the date at which it will be 
extended: 
27 February 2013 (provisional measure) - 26 February 2019  
 
iv. Precise description of the measure in place prior to the date of extension: 
Duty of 42.95% of c.i.f. price during 27 February 2015 - 26 February 2016  
10  INFORMATION RELATING TO EXPORTING MEMBERS 
a. The main exporting countries to Thailand are the People's Republic of China, the 
Republic of Korea and Japan; 
b. There are no exporting Members to which the measure does not apply for any reason 
other than the application of Article 9.1. 
11  THE DEADLINES FOR INTERESTED PARTIES TO COMMENT OR ANY OTHER 
PROCEDURES RELEVANT TO THE DECISION TO APPLY OR EXTEND A SAFEGUARD MEASURE 
The interested parties wishing to comment on th e proposed extended measure and to attend the 
public hearing should submit their comments to DFT by 12 January 2016 and provide the list of attendees (name and position), latest, on 11 January 2016.  
A public hearing has been set for interested parties directly concerned by this proceeding to be 
held on 13 January 2016, 09h00, Room 1601, Department of Foreign Trade Building, at the address: 
Department of Foreign Trade (DFT), Ministry of Commerce of Thailand 
563 Nonthaburi Road, Bangkasor, Meung Nonthaburi 11000 THAILAND 
Telephone: (662) 547-4739 Facsimile: (662) 547-4741  
Email: butrade@moc.go.th , piyachats@moc.go.th  
 G/SG/N/10/THA/2/Suppl.2 • G/SG/N/11/THA/2/Suppl.4 
 
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  12  INFORMATION REGARDING PROCEDURES FOR PRIOR CONSULTA TION WITH THOSE 
MEMBERS HAVING A SUBSTANTIAL INTEREST AS EXPORTERS OF THE PRODUCT CONCERNED 
The interested parties with substantial interest are invited for prior consultations to be held, upon 
request, during 14-15 January 2016 at the same address above. The requests for prior 
consultation should submit to DFT as soon as  possible, but not later than 11 January 2016. 
 
 
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