Learn the Basics of Antidumping and Countervailing Duties
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The document provides an overview of anti-dumping and countervailing duties, explaining their definitions, history, and processes for petitioning and investigation. It outlines the steps involved in determining whether foreign producers are dumping goods or receiving subsidies, including the roles of the Department of Commerce and the International Trade Commission. Additionally, it highlights the importance of administrative and sunset reviews for ongoing monitoring of these duties.
Learn the Basics of Antidumping and Countervailing Duties
- 2. Tyler Zaichkin National Sales & Marketing Manager Bozeman, Montana Trade Risk Guaranty Brokerage Services, LLC tzaichkin@traderiskguaranty.com 1st
- 3. • Located in Beautiful Bozeman Montana • Established in 1991 • Direct-to-Importer Business Model • Over 10,000 U.S. Customs Bond & Marine Cargo Insurance Clients TRADE RISK GUARANTY BROKERAGE SERVICES, LLC
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- 5. TODAY’S WEBINAR TOPICS Dumping and Subsidized Exports Anti-dumping and Countervailing Duty Definition History of Anti-dumping and Countervailing Duty Petitions for Anti-dumping and Countervailing Relief Investigation and Determination Administrative Review Sunset Review
- 6. Dumping “Dumping occurs when a foreign producer sells a product in the United States at a price that is below that producer's sales price in the country of origin (‘home market’), or at a price that is lower than the cost of production.” “…a foreign producer selling imports at prices below those of American products is not necessarily dumping.” http://enforcement.trade.gov/intro/
- 7. Subsidized Exports Industries and products in which foreign governments “provide financial assistance to benefit the production, manufacture or exportation of goods.” “Subsidies can take many forms, such as direct cash payments, credits against taxes, and loans at terms that do not reflect market conditions.” http://enforcement.trade.gov/intro/
- 8. Defining Anti-dumping and Countervailing anti-dumping duty noun | ˌan-tē-ˈdəm-piŋ ˈdü-tē a protectionist tariff imposed on foreign imports believed to be priced below market value and causing material harm to the domestic market countervailing duty noun | ˌkau̇n-tər-ˈvāliŋ ˈdü-tē a protectionist tariff imposed on foreign imports believed to be subsidized by a foreign government and causing material harm to the domestic market
- 9. History of Anti-dumping and Countervailing • Anti-dumping act of 1916 – Dumping related to predatory pricing – Enforced through legal proceedings • Anti-dumping act of 1921 – Dumping related to price discrimination – Enforced though higher import duties http://www.nber.org/papers/w10582.pdf
- 10. History of Anti-dumping and Countervailing • Tariff Act of 1930 – Defined Anti-dumping and Countervailing duties under Subtitle IV – Authorized investigation of unfair competition relating to imports • General Agreement on Tariffs and Trade (GATT 1947) – Negotiated during the United Nation Conference on Trade and Employment and took effect on January 1, 1948 – Article VI based on U.S. Anti-dumping Act of 1921 https://en.wikipedia.org/wiki/General_Agreement_on_Tariffs_and_Trade http://www.nber.org/papers/w10582.pdf
- 11. History of Anti-dumping and Countervailing • Trade Act of 1974 – Dumping definition expanded to include home market sales below the average cost of production • Trade Agreements Act of 1979 – Repealed Antidumping Act of 1921 – Revised law enacted as Title VII to the Tariff Act of 1930 – Shortened time limits on dumping and subsidized export investigations – Allowed use of “best information available” when foreign firms did not provide requested information http://www.nber.org/papers/w10582.pdf
- 12. “An interested party may file an anti-dumping or countervailing duty petition…alleging that an industry in the United States is materially injured or threatened with material injury, or that the establishment of an industry is materially retarded, by reason of imports that are being, or are likely to be, sold in the United States at less than fair value or by reason of imports that are being subsidized by the governments of one or more countries.”
- 13. Petitioning for Anti-dumping and Countervailing Relief Interested Parties – Manufacturers, Producers, & Wholesalers – Unions, Trade Associations, & Business Associations – Coalition of Agriculture Processors, Producers, & Growers Material Injury – Of consequence or importance – Substantial in nature https://www.usitc.gov/trade_remedy/documents/handbook.pdf
- 14. Petitioning for Anti-dumping and Countervailing Relief Less than Fair Value – A price that is below the sales price in the country of origin, “home market” – In absence of sufficient data, surrogate “third country” data may be used – In absence of “home market” and “third country data”, a cost-plus- profit “constructed value” approach may be used https://www.usitc.gov/trade_remedy/documents/handbook.pdf
- 15. Anti-dumping and Countervailing Investigation and Determination Department of Commerce – Determines whether foreign producers are dumping goods or receiving financial assistance to benefit the production, manufacture or exportation of goods International Trade Commission – Determines whether the domestic industry is suffering material injury as a result of the imports of the dumped or subsidized products
- 16. Anti-dumping and Countervailing Investigation and Determination Initiation of Investigation (Commerce) Preliminary Investigation (USITC) Preliminary Investigation (Commerce) Final Determination (Commerce) Final Determination (USITC) 20 days after the filing of the petition 45 days after the filing of the petition 115 days after the USITC preliminary determination for anti-dumping, or 40 days in countervailing duty cases 75 days after Commerce preliminary determination 120 days after Commerce preliminary determination, or 45 days after its final determination, whichever is later If affirmative, Commerce orders Customs to suspend liquidation of entries and collect cash deposits
- 17. Anti-dumping and Countervailing Investigation and Determination • If both Commerce and USITC make affirmative final determinations of injury, Commerce issues an anti-dumping or countervailing duty order to Customs and Border Protection (CBP) • Cash deposits must be made at the rates established in the final determination for all entries of subject merchandise on or after the date of the preliminary determination • Entries will remain suspended until Administrative Review
- 18. Administrative Review • Interested parties may annually request an Administrative Review of anti-dumping and countervailing orders • This request must be made in the anniversary month of the publication of the anti-dumping or countervailing order • Commerce makes a determination of the duties to be assessed on specific entries made during the previous 12 month period (longer for the first administrative review)
- 19. Administrative Review • Administrative reviews also establish new cash deposit rates for each of the companies reviewed • If no review is requested for a particular exporter, entries of that exporter’s merchandise will be assessed at the cash deposit rate in effect at the time of entry
- 20. Sunset Review • Since 1995, Commerce and USITC have been required to conduct a review on the fifth anniversary of the anti- dumping or countervailing order • Sunset Reviews are automatically initiated 30 day prior to the fifth anniversary • The review is to determine whether revoking the order would be likely to lead to continuation or recurrence of dumping or subsidies (Commerce) and of material injury (USITC).
- 21. COVERED IN TODAY’S WEBINAR Dumping and Subsidized Exports Anti-dumping and Countervailing Duty Definition History of Anti-dumping and Countervailing Duty Petitions for Anti-dumping and Countervailing Relief Investigation and Determination Administrative Review Sunset Review
- 23. Next Webinar, March 30 We will be going more in-depth into Anti-dumping and Countervailing. Specifically discussing how to monitor open petitions, calculate cash reserves, mitigate your business risk, and much more! March 30, 2017 1:00 PM Eastern / 10:00 AM Pacific http://bit.ly/adcvd-p2
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