G/SG/N/6/ZAF/6  
 
24 April 2018  
(18-2578) Page: 1/3 
Committee on Safeguards  Original: English  
 
NOTIFICATION UNDER ARTICLE 12.1(A) OF THE AGREEMENT  
ON SAFEGUARDS ON INITIATION OF AN INVESTIGATION  
AND THE REASONS FOR IT  
SOUTH AFRICA 
(Other screws fully threaded with hexagon heads  made of steel ) 
 
The following communication, dated 23 April  2018, is being circulated at the re quest of the 
Delegation of South Africa . 
 
_______________  
 
 
Pursuant to Article 12.1(a) of the Agreement on Safeguards, South Africa hereby gives notification 
of the initiation of a safeguard investigation into the surge  of imports of other screws fully 
threaded with hexagon heads made of steel.  
 
1  THE DATE WHEN THE IN VESTIGATION WAS INIT IATED  
The investigation was initiated on 20 April 2018. The notice of initiation by the investigating 
authority was published through Noti ce No. 199 in Government Gazette  No. 41585 on 
20 April 2018.* 
 
2  THE PRODUCT SUBJECT TO THE INVESTIGATION  
The subject product is described as other screws fully threaded with hexagon heads made of steel 
imported under tariff subheading 7318.15.39.  
 
3  THE REASONS FOR THE INIT IATION OF INVESTIGAT ION 
(i)  The application was lodged by the South African Iron and Steel Institute (SAISI) (the 
Applicant) on behalf of on behalf South African Fasteners Manufacturers ' Association ( "SAFMA ") 
and its members CBC Fasten ers (Pty) Ltd ( "CBC") and Transvaal Pressed Nuts Bolts and Rivets 
(Pty) Ltd ( "TPN"). SAISI is a non -governmental representative organization serving the collective 
interests of the primary steel industry in South Africa. TPN and CBC are largest producers o f other 
screws fully threaded with hexagon heads made of steel (the subject product). Together, they 
represent the SACU industry.  
 
The claim is that the subject product is being imported into the SACU market in such increasing 
quantities in absolute terms and relative to SACU production and under such conditions, to be 
causing serious injury to the SACU industry.   
 
                                                
* To consult this Notice of Initiation, please contact Ms  Budd (hilary.budd@wto.org) or Ms  Naville  
(delphine.naville@wto.org) of the  Rules Division.  
 G/SG/N/6/ZAF/6  
 
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  (ii)  Prima facie information on which the investigation was initiated:  
 
The Commission found that the Applicant submitted prima facie  information to indicate a sharp, 
sudden, recent and significant increase in imports of other screws fully threaded with hexagon 
heads made of steel during the period of investigation.  
 
4  SERIOUS INJURY AND C AUSAL LINK  
The period of investigation for data ev aluation for the purposes of determining the allegation of 
serious injury is 01 July 2014 to 30 June 2017.   
 
The injury analysis relates to information submitted by CBC and TPN the largest producers of the 
subject product in the SACU, representing a major proportion of the SACU industry.   
 
The Applicant alleged and submitted prima facie evidence indicating that it is experiencing serious 
injury in the form of a decline in sales volumes, output, market share, productivity, utilisation of 
capacity and employm ent for the period 01 July 2014 to 30 June 2017. The Applicant indicated 
that CBC and TPN also experienced net losses during the period of investigation.  
 
5  UNFORESEEN DEVELOPME NTS 
The Applicant stated that a confluence of events forms the basis of the unfor eseen development 
that supports this application, which is, ultimately the considerable oversupply of fastener, and 
specifically the subject product, in the world today causing a surge in the volume of imports into 
the SACU.  
 
The Applicant stated that sub mitting information on these unforeseen developments, when 
reference is made to fasteners, it invariably also refers to the product concerned in this 
application. This is because set screws form an integral part of this industry and can be considered 
as th e bread and butter of the fastener industry.  The Applicant further stated that during the 
Uruguay Round negotiations in 1986 -1994, South Africa did not foresee the following events:  
 
 The unprecedented steep rate of increase in fastener production capacity after the 
Uruguay Round of negotiations. This mainly took place to support growing construction 
and manufacturing activity, as well as to help build infrastructure, particularly in emerging 
economies. This growth in global capacity was mainly fuelled by th e growth of the Chinese 
and Asian fastener markets;  
 
 The significant downturn of the fastener market as a result of the Asian financial crisis that 
contributed to the imbalance between capacity and demand, that is, the global oversupply 
of fasteners. This led to a significant increase in export volumes by countries with excess 
capacity; and  
 
 This in turn led to an unprecedented increase in trade remedy actions being taken on 
fastener products, including set screws by a number of countries, notably the Canad a and 
the European Union which are significant export markets for the products concerned. 
Given the fact that fasteners are basically a commodity product, excess capacity in one 
region can with relative ease displace production in other regions, thus harmi ng producers 
in those markets.  
 
The Commission decided that the Applicant submitted prima facie  information to indicate that 
there were unforeseen developments  and that these unforeseen developments and the effect of 
the obligations incurred under the GATT  1994, led to the increased volume of imports.  
 
6  FURTHER INFORMATION  
Interested parties must make themselves known within a period of 20 days after the initiation of 
the investigation.  
 
Any information which the interested parties may wish to submit in writing and any request for a 
hearing before the Commission that they may wish to put forwar d should be submitted within 
20 days following the initiation of this investigation to the Directorate: Trade Remedies I at the G/SG/N/6/ZAF/6  
 
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  following address: The DTI Campus, 7 7 Meintjies Street, Sunnyside Pretoria, Block Uuzaji, Ground 
Floor, Tel: +27 12 394 3600, fax +27 12 394 0518.  
 
If part of the information provided is of a confidential nature, the party concerned should give the 
grounds justifying confidentiality and furn ish public summaries of such information, which should 
be as detailed as possible. In instances that a public summary cannot be provided a sworn 
statement must be provided stating the reasons why the information cannot be summarized. This 
requirement is de signed to secure transparency and due access by all the parties to the 
information relating to this investigation. If the summaries are not duly provided and in the 
absence of just cause, ITAC may disregard the information deemed to be confidential.  
 
 
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