Rules explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Rules 1 to 4 open the India-Japan bilateral safeguard framework. They name the rules and bring them into force, define the key terms, list what the Director General (Safeguard) must do and say how an investigation begins. If imports from Japan have risen because of a duty reduction under the agreement, these four rules decide who can ask for a safeguard measure and what the application must show.
This article reads the rules as amended up to the CBIC text dated 24 January 2017 (Notification No. 7/2017-Customs (N.T.) dated 24 January 2017; no amending notification found in CBIC's 2023-2026 lists). Later notifications should be checked before you rely on the current text.
The rules apply when the elimination or reduction of customs duty under the India-Japan CEPA leads to increased imports of an originating good that cause or threaten serious injury to the domestic industry. The Director General starts an investigation on a written application by or on behalf of the domestic producer, or suo moto on information from a Commissioner of Customs or another source, but only after checking that the evidence is accurate and sufficient.
The legal basis (preamble) and rule 1
Notification No. 7/2017-Customs (N.T.) dated 24 January 2017 makes the rules under section 5(1) of the Customs Tariff Act, 1975, read with section 25(1) and section 156 of the Customs Act, 1962. Under rule 1(2) the rules came into force on the date of their publication in the Official Gazette. Rule 1(1) gives the short title, the India-Japan Comprehensive Economic Partnership Agreement (Bilateral Safeguard Measures) Rules, 2017.
These rules sit beside the general safeguard framework. The Director General is the officer appointed under rule 3(1) of the Customs Tariff (Identification and Assessment of Safeguard Duty) Rules, 1997, whose own rules are explained in Rules 1 to 4 of the Safeguard Duty Rules, 1997. A general discussion of how safeguard and countervailing duties differ is in our guide to safeguard and countervailing duty.
Rule 2: definitions
If you are unsure whether your import or product falls inside these definitions, a short legal consultation before any filing can save wasted effort.
Rule 2(1) defines the terms the rest of the rules use. The table sets out the ones that matter most.
| Term | What rule 2(1) says |
|---|---|
| Critical circumstances (a) | Clear evidence that increased imports of an originating good have caused or are threatening to cause serious injury to the domestic industry, and delay in imposing a provisional measure would cause damage that would be difficult to repair |
| Director General (b) | The Director General (Safeguard) appointed under rule 3(1) of the 1997 safeguard rules |
| Domestic industry (c) | Producers as a whole of the like or directly competitive good in India, or those whose collective output makes up a major proportion of total production of that good in India |
| Good (d) | Any merchandise, product, article or material |
| Increased imports (e) | Increase in imports from Japan, whether in absolute terms or relative to domestic production |
| Interested party (f) | Exporters, producers or importers of the good under investigation, trade or business associations of such persons, the Government of Japan, and domestic producers of the like or directly competitive good or their associations |
| Originating good (g) | A good qualifying as originating under the Customs Tariff (Determination of Origin of Goods under the CEPA between India and Japan) Rules, 2011, notified as Notification No. 55/2011-Customs (N.T.) dated 1 August 2011 |
| Serious injury (h) | A significant overall impairment in the position of the domestic industry |
| Threat of serious injury (i) | Serious injury that, on facts and not merely allegation, conjecture or remote possibility, is clearly imminent |
| Trade Agreement (j) | The Comprehensive Economic Partnership Agreement between India and Japan |
Rule 2(2) adds that words not defined in the rules but defined in the Customs Tariff Act, 1975 or the Customs Act, 1962 carry the meaning given in those Acts.
Two points deserve attention. First, "increased imports" is wider than in some older rules because it covers an increase relative to domestic production, not only in absolute terms. Second, the definition of "originating good" ties the safeguard to the origin rules for Japan, so a good that does not qualify under those rules is outside the bilateral measure. Our overview of the India-Japan CEPA rules of origin explains how originating status is decided.
Rule 3: duties of the Director General
Subject to the rules, the Director General must do the following.
- Rule 3(a): investigate whether increased imports of an originating good into India have caused or are threatening to cause serious injury to the domestic industry as a result of elimination or reduction of customs duty under the Trade Agreement.
- Rule 3(b): evaluate all relevant factors of an objective and quantifiable nature, in particular the rate and amount of the increase in imports in absolute and relative terms, the share of the domestic market taken by the increased imports, and changes in sales, production, productivity, capacity utilization, profits and losses and employment.
- Rule 3(c): submit his findings, provisional or otherwise, to the Central Government.
- Rule 3(d): recommend a bilateral safeguard measure which, if adopted, would be adequate to prevent or remedy the serious injury.
- Rule 3(e): recommend the duration of the measure and, if the period is more than a year, the progressive liberalization needed to facilitate adjustment.
- Rule 3(f): review the need for continuation of a measure.
The Director General makes recommendations only. The measure itself is applied by the Central Government, which the later rules make clear.
Rule 4: initiation of investigation
The application (rule 4(1) and (2))
Except in the suo moto case, the Director General initiates an investigation on receipt of a written application by or on behalf of the domestic producer of the like or directly competitive good. The application must be in the form the Director General specifies and must be supported by:
- Evidence of increased imports of the originating good, serious injury or threat of serious injury to the domestic industry, a causal link between the imports and the injury, and the duty reduction under the Trade Agreement being a cause that contributes significantly to the increase in imports and that the increase constitutes a substantial cause of serious injury. The proviso states that the duty reduction need not be equal to or greater than any other cause.
- A statement on the efforts being made, or planned, to make an adjustment to import competition.
The check before initiating (rule 4(3))
The Director General may not initiate unless he has examined the accuracy and adequacy of the evidence and is satisfied that there is sufficient evidence on all four points: increased imports, serious injury or threat, a causal link and the contribution of the duty reduction. The same proviso on the "other cause" applies here.
Suo moto initiation (rule 4(4))
Despite sub-rule (1), the Director General may start an investigation on his own if he is satisfied, from information received from any Commissioner of Customs or any other source, that sufficient evidence exists on the four points in sub-rule (3).
A practical example
Kestrel Auto Components, a domestic maker, sees imports of a part from Japan rising after the agreement's duty reductions. It prepares an application in the form the Director General specifies, attaches evidence of the rise in imports, its own fall in sales and profit, the link between them and the effect of the duty reduction, and a statement of its adjustment plans. The Director General then tests the accuracy and adequacy of the evidence under rule 4(3). Only if he is satisfied does the investigation start.
What the rules do not print
The rules do not print a threshold for market share or import volume in this part, a filing fee or an application format; the form is "as may be specified by the Director General". Any such detail would have to come from the Director General's public notices, which are outside this article.
Need help with a safeguard application or response?
Whether you are a domestic producer preparing the evidence required by rule 4(2) or an importer of Japanese goods facing an investigation, early planning makes a difference. Our legal consultation team can review the evidence you hold against the four points in rule 4(3) and advise on next steps. The later stages are covered in the article on Rules 5 to 10 of the same rules.
Key takeaways
- The rules cover increased imports from Japan caused by duty reduction under the India-Japan CEPA.
- "Increased imports" includes an increase relative to domestic production.
- "Originating good" follows the 2011 origin rules (Notification No. 55/2011-Customs (N.T.)).
- The Director General investigates and recommends; the Central Government applies the measure.
- An application needs evidence on four points and a statement of adjustment efforts.
- The Director General may initiate suo moto on information from a Commissioner of Customs or any other source.
Read next
- Rules 5-10 of the India-Japan CEPA Bilateral Safeguard Measures Rules, 2017
- Rules 1-4 of the Safeguard Duty Rules, 1997
- Rules of origin under the India-Japan CEPA
- Safeguard and countervailing duty explained
Disclaimer: Based on the India-Japan Comprehensive Economic Partnership Agreement (Bilateral Safeguard Measures) Rules, 2017 as published on the CBIC Tax Information Portal, as consulted on 3 October 2026. Later notifications, duty notifications and the Customs Tariff Act, 1975 should be checked. This article is general information, not legal advice; check the official text before acting.