Anti-dumping Practice Research Articles

Legal Analysis of Public Interest in Anti-Dumping Practice: Focusing on Korea-EU FTA

Legal Analysis of Public Interest in Anti-Dumping Practice: Focusing on Korea-EU FTA

Natural Resource Underpricing in WTO Subsidies Rules and Beyond: A Reflection of North-South Divide in Globalization

The article discusses natural resource underpricing in multilateral subsidy rules’ negotiations. It starts from the U.S. experiences to consider foreign natural resource underpricing practices under its underdeveloped subsidy rules. The United States then brought its domestic concern to the Uruguay Round establishing the World Trade Organization; however, conflicts had been shown between the industrialist countries and the resource-endowed ones regarding the ways of using natural resources as a comparative advantage. At this corner of trade rulemaking, the North’s pro-market demand was likely to collide with the South’s natural resource sovereignty. Natural resource underpricing has again taken the stage in the ongoing Doha Development Round for renegotiation of the WTO Subsidies Agreement; nevertheless, it seems to partly place this multilateral trade rulemaking under a stalemate. The crux of the subsidy debates on natural resources is how to deal with the government’s market predominance concern as to reflect the government’s roles in the natural resource sector. The European Union’s pressure on the WTO accession of several resource-endowed countries has been quite effective since the latter chose to surrender part of their natural resource sovereignty as a price of economic integration. However, the EU present anti-dumping practice against the natural resource underpricing problem seems to add fuel to the dilemma since its trade law consistency is under challenge.

From ‘Non-market Economy’ to ‘Significant Market Distortions’: rethinking the EU anti-dumping regulation and China’s state interventionism

Abstract This article questions the consistency of the EU anti-dumping regulation with the WTO Anti-dumping Agreement. It argues that with the expiry of paragraph 15(a)(ii) on 11 December 2016, China’s WTO Accession Protocol may no longer provide the legal basis for the EU to set aside Chinese domestic prices in determining normal value of Chinese products. Moreover, given that the European Commission has consistently used costs that are not actual costs of Chinese producers in constructing normal value of Chinese products, the EU anti-dumping practice runs the risk of being inconsistent with WTO law since the WTO Anti-dumping Agreement does not allow for such flexibility when determining costs of production in the exporting country. Drawing on Jackson’s interface theory, this article further argues that the EU’s introduction of the new concept ‘significant market distortions’ to anti-dumping practices should be conceptualized as an effort to reconstitute alternative interface mechanisms when old ones are no longer applicable. The dubious legality of the EU’s new anti-dumping regulation is simply a symptom of a long-brewing tension in the multilateral trade system: how can the WTO accommodate systemic friction between heterogeneous economic models?

US Anti-Dumping Practices Evolving against Market Economies

AbstractThis study examines how US discretionary practices developed in the past decade have affected antidumping duty rates against exporters. Using the most recent data on dumping margin calculations, we find that the US Department of Commerce (DOC) has developed discretionary practices in a more nuanced manner to inflate dumping margins, which have primarily targeted market economy exporters. Our case studies document that practices known as targeted dumping and particular market situations appear to serve as trade protectionism for market economy exporters, especially those who could otherwise have received a negative determination without such practices. Furthermore, the DOC has brought an apparent change in its application of discretionary practices after the Trade Extension Preferences Act of 2015, leading to much higher dumping margins for the market economy. Along with empirical and case analyses, we further examine the World Trade Organization (WTO) jurisprudence concerning the extent to which the discretion of an investigating authority in anti-dumping proceedings can be condoned in the WTO.

Input Cost Adjustments and WTO Anti-Dumping Law: A Closer Look at the EU Practice

AbstractIn anti-dumping procedures, the EU authorities have adjusted State-distorted input costs in the constructed normal value to market benchmarks. This methodology increases the amount of anti-dumping duties and hence import barriers to foreign goods produced with low-priced raw materials. Such cost adjustments are based on certain EU anti-dumping provisions that implement corresponding World Trade Organization (WTO) rules under which the cost of input must be derived, as a principle, from the records of target companies in the exporting country if those records, inter alia, reasonably reflect production costs of the product under investigation. But in the case of input costs distorted by the government, the EU authorities have typically deviated from this principle relying on alternative sources on the grounds of unreasonable costs. While the EU jurisprudence has so far been generally lenient towards this methodology as applied to significant distortions in the raw material (upstream) market, the recent WTO appellate ruling inEU–Biodieselis rather negative on its use in the presence of the valid domestic records. This article examines the EU anti-dumping practice as reviewed in both EU and WTO judicial proceedings and discusses some legislative reforming options under both regimes. It concludes that the WTO anti-dumping rules should be amended to allow market-oriented cost adjustments in the normal value, on the one hand, and ensure parallel export price adjustments, on the other.

Anti-dumping practice in India: due process, confidentiality and the WTO standards

The trade remedy laws of India, as a Member to the World Trade Organisation, are governed by provisions of the relevant Agreements, including the Agreement on Implementation of Article VI of the General Agreement on Tariffs and Trade 1994, commonly referred to as the AD Agreement. India deserves special mention as the highest user of trade remedy laws in the world. One would imagine that such a rich history of anti-dumping investigations would have resulted in highly sophisticated jurisprudence in India and by now, India should have added to the jurisprudence and understanding of the AD Agreement. Reality disagrees and this article explores recent, but interesting, developments highlighting progress and regress of Indian anti-dumping law and practice.

Anti-dumping Practices and China's Implementation of WTO Rulings

AbstractWe explore China's behaviour in taking anti-dumping actions, with a focus on those which have been challenged under the WTO dispute settlement mechanism. We argue that the typical motivations behind China's resort to anti-dumping measures include protection, retaliation, industrial development and export promotion. These motivations are likely to carry more weight than China's observance of WTO obligations when deciding whether to impose anti-dumping measures and whether to implement WTO rulings. Brief recommendations are provided to foreign governments and exporters on how to avoid China's anti-dumping actions.

Rule of Law or Rule of Protectionism: Anti-Dumping Practices toward China and the WTO Dispute Settlement System

One of the great benefits coming along with China’s new XWTO membership card is the availability of the WTO dispute settlement proceedings. As former United States Trade Representative Charlene Barshefsky declared after U.S. Senate voted to approve the PNTR for China: “China… will join the community governed by the rule of law.”‘ WTO rules are enforced through the WTO Dispute Settlement System (DSS), governed by the Understanding on Rules and Procedures Governing the Settlement of Disputes (DSUy), which is one cornerstone of the 1994 Marrakesh Agreement establishing the WTO. After the Uruguay Round, trade dispute settlement, through the DSS, has moved to the center stage of international economic diplomacy, and has been working reasonably well? During the past seven years, the number of disputes submitted to the WTO had considerably increased to over 236 by August 31, 2001, ten times the number under the GATT.

Debunking the Myth of ‘Particular Market Situation’ In WTO Antidumping Law

This article explores the issue of ‘particular market situation’ (PMS) in anti-dumping practice. PMS has become one of the most controversial issues in antidumping policy, as reflected for example in the bilateral trade activities between China and Australia, and will soon become a prominent issue at the World Trade Organization (WTO) level once the non-market economy assumption (which is currently allowed under China’s WTO Accession Protocol) expires on 11 December 2016. Essentially, since some of the underlying concerns that led to the creation of such an assumption may endure following December 2016, countries may want to resort to other alternative methods to counteract Chinese imports. One such alternative is to resort to the notion of PMS which is foreseen in the WTO Antidumping Agreement. It is, therefore, important for the WTO tribunals to standardize the law and practice in relation to PMS. This article argues that the existence of a situation in a market, such as government interventions by means of regulation or financial assistance, does not in themselves constitute a PMS within the meaning of the Antidumping Agreement. Rather, a determination of a PMS must be based on an assessment of the comparability between domestic sale price and export price of the subject goods. A PMS should not be found to exist if an alleged price distortion has affected the two prices even-handedly such that a proper comparison of the prices would not be precluded. It is the responsibility of investigating authorities to undertake such an inquiry into comparability. Without such an inquiry, a finding of PMS cannot be justified and would likely result in a comparison between an undistorted normal value and a distorted export price in a manner contrary to the ‘proper comparison’ or ‘fair comparison’ standards which are enshrined in Article 2 of the Antidumping Agreement. The proposed approach to PMS finds support in the Antidumping Agreement itself, as well as in negotiating records of the General Agreement on Tariffs and Trade (GATT) and the WTO, and GATT and WTO jurisprudence. Importantly, it promotes free trade by prohibiting unjustified inflation of dumping margins and discouraging tit-for-tat abuse of PMS.

Anti-Circumvention in the Multilateral System: Plus ça Change

World Trade Organization (WTO) Members have long struggled to distinguish between acceptable responses to the imposition of anti-dumping duties and inappropriate efforts to ‘circumvent’ such duties. This article summarizes the efforts to formulate multilateral norms on anti-circumvention, from the early General Agreement on Tariffs and Trade (GATT) dispute settlement challenges through the Uruguay Round, the WTO's Informal Group on Anti-Circumvention and the more recent Rules negotiations of the Doha Round. Despite these efforts, WTO Members have been unable to agree on what constitutes circumvention, much less adopt rules governing the use of anti-circumvention measures. Yet despite the legal uncertainties, thirty-six Members have notified include anti-circumvention provisions to the Committee on Anti-Dumping Practices, and six Members have reported the initiation of 103 anti-circumvention proceedings to the Committee since 2009. While Members would appear to share a common interest in having some predictability and certainty in defining what is and is not appropriate behaviour, both for exporters and importing Members, the gaps, both of principle and practical, have to date proved insurmountable.

Anti-Circumvention: A Comparison

No basic multilateral definition of ‘circumvention’ is embedded within Article VI, nor in any subsequent Anti-Dumping Code or Agreement. This lack of a multilateral framework is striking, given the prominence this issue has assumed in the world of anti-dumping. Indeed, as reported in the World Trade Organization (WTO) Chapter, 36 of the 87 AD legislations that were notified to the Committee on Anti-Dumping Practices already include anticircumvention provisions and more nations are expected to follow suit. This article provides a comparison of the relevant provisions and practices in the nine jurisdictions discussed in this Special Edition of the Global Trade and Customs Journal. This article also describes certain potential WTO concerns arising from this growing unilateral ‘self-regulation’ and practice. This overview does not include other possible means of combatting circumvention that could exist outside the traditional dumping ‘arena’, such as, for example, national criminal investigations, special customs proceedings or specific antifraud investigations.

Why the EU Anti-dumping Practice to Adjust Inputs Costs in Situations Where Such Costs Are ‘Artificially Low’ Is Legitimate and Justified

Why the EU Anti-dumping Practice to Adjust Inputs Costs in Situations Where Such Costs Are ‘Artificially Low’ Is Legitimate and Justified

Assessment of ‘Material Injury’ and ‘Causation’: Recent Developments in Australia

The article discusses the most recent developments in Australia’s anti-dumping practice on the determination of ‘material injury’ and ‘causation’. It argues that while Australia’s anti-dumping investigating authority has failed to conduct assessment of ‘injury-causation’ adequately and objectively in past investigations, in two recent investigations the authority seems to have become more objective and comprehensive in its ‘injurycausation’ determinations. The developments suggest that the Australian authority has started moving towards a thorough and unbiased analysis of ‘injury-causation’ in accordance with World Trade Organization (WTO) rules. They also suggest that active and full participation in ‘injurycausation’ defence in an investigation is crucial for exporters and other parties with shared interest to increase their odds of success.

Could Least Developed Countries (LDCs) and Other Developing Countries Which Have Not Been Able to Establish Legal Framework for the Application of Trade Remedy Measures Make a Beginning by Establishin

The rule based multilateral trading system created by World Trade Organization (WTO) recognizes that in pursuing liberal and open trade policies, countries may have to use trade remedy measures such as anti-dumping countervailing or safeguard measures in cases where their domestic agricultural producers or manufacturing industries are hurt or injured by imports. However, such trade remedy measures can be applied only after investigations undertaken in accordance with the detailed rules laid down by the Agreements on Anti-dumping Practices (ADP), Subsidies and Countervailing Measures and on Safeguards, it is established that increased imports are causing injury to the domestic agricultural producers or industry. As a result, over sixty developing countries, most of which are least developed or countries at lower stages of development, which have not been able to establish such framework because of financial and other constraints are not able to make effective use of the rights which these Agreements provide. The paper suggests that in the situation, the least developed and other developing countries which have not been able to establish legal and institutional framework for applying all of the three trade remedy measures, should be permitted to apply only safeguard measures, which from the administrative point of view would require only modest staff, by adopting an Understanding. It is also in this context important to note that after the conclusion of the Doha Round, all developing countries would be able to apply to agricultural products, special safeguard measures if the price of imports falls below specified price trigger or their volume exceeds specified trigger, irrespective of whether the imported goods which are causing injury are being dumped or being subsidized. The need to apply safeguard measures in accordance with the provision of the Understanding clarifying the rules of the Safeguard Agreement would arise only in a few cases of manufactured products where domestic industries complain that the increased imports are causing serious injury to them.

WTO Antidumping and Developing Countries: A Case Study of Vietnam

The paper takes a close look at antidumping practice in Vietnam, giving lessons to Vietnamese exporters of how to respond to an antidumping investigation. The author uses case studies of South Africa, India, and China to identify how those countries improve their antidumping policies to be more consistent with WTO regulations and how they counteract when an investigation is initiated. I begin by providing a comprehensive overview of global antidumping practice, then move to the case of Vietnam, giving comments on her antidumping legislation, and analyzing two most important cases which have had significant impacts on Vietnam’s enterprises. As a relatively new and small member of the WTO, Vietnam lacks experience in settling disputes. The dissertation is going to explore experience of the developing countries which share common eco-socio features with Vietnam when the risk of being found guilty of dumping on foreign markets is discernible.

US Compliance with WTO Rulings on Zeroing in Anti-Dumping

AbstractThis paper reviews the WTO Appellate Body Reports on United States–Zeroing (EC) (Article 21.5 DSU – EC) (WT/DS294/AB/RW, 14 May 2009) and United States–Zeroing (Japan) (Article 21.5 DSU – Japan) (WT/DS322/AB/RW, 18 August 2009). The Appellate Body found that the United States had not brought its anti-dumping measures into compliance with the WTO Anti-Dumping Agreement as it continued to use zeroing in annual reviews of anti-dumping orders. We argue that this conclusion – based on a complicated discussion of what constitutes a ‘measure taken to comply’ – could have been reached through a much simpler and direct argument. Continued noncompliance by the United States generates costs to traders targeting the United States and the trading system more generally. We argue that from a broader WTO compliance perspective consideration should be given to stronger multilateral surveillance of anti-dumping practice by all WTO members and to more analysis and effective communication by economists regarding the costs of zeroing and anti-dumping practices more generally.

China’s Non-state Enterprises and Anti-Dumping Practices: A Perspective

This paper discusses and analyses China’s non-state enterprises and the severe challenges they face in responding to overseas anti-dumping investigations. It begins by presenting a general overview of China’s non-state enterprises in its trade regime. It then moves to address and analyse anti-dumping challenges that China’s non-state enterprises have encountered in the past. It further discusses some issues regarding anti-dumping laws and policies adopted by China’s major trading partners against Chinese exports and their impact on China’s non-state enterprises. The paper concludes that more intensive efforts should be made by governments, enterprises and other national and international organizations to construct a more balanced synthetic system to prevent and control the occurrence of dumping. Such a system should not focus on how and what measures should be undertaken after the occurrence of dumping and thus trying to prosecute (for the importing country) or fight the case (for the exporting country or respondents) but should assist these enterprises in transferring from a price-oriented competition to a product quality or technology-oriented competition. This will not only facilitate China’s own domestic reform in economics and trade but will also, in turn, play a constructive role in promoting stability and growth in the world trading system at large.

Statistics, Anti-dumping and the Emperor’s New Clothes

ECIPE Working Paper No. 02/2009 on ‘Ten years of anti-dumping policy in the European Union (EU)’ has raised a number of interesting issues. It identifies five tendencies based on an empirical examination of the anti-dumping statistics over the past ten years. One tendency identified is that the products targeted by EU anti-dumping actions ‘are concentrated in sectors where European comparative advantage is declining that is, raw materials, industrial input goods and textiles’. This particular tendency cannot be deduced from the paper itself. In addition, if this tendency is removed, the other tendencies do not seem to show much need for the concerns expressed. They are merely the usual consequences of normal anti-dumping procedures. Thus, the paper’s conclusion that there is a tendency of ‘targeting fair and legitimate market competitors from abroad through anti-dumping protectionism’ is not shown in the paper either. Like many conclusions based on statistics, the paper fails to exclude, or even examine, other possible causes of the supposed trends identified. Nor does it show why a normal aspect of anti-dumping, such as the fact that the duties imposed are higher than bound duties, is disquieting or even remarkable in any way. In addition, the statistics cited appear to contain factual errors. This note is a brief commentary on the ECIPE anti-dumping paper. Its purpose is to highlight some of the problems in the approach taken. It shows that the statistical examination of the last ten years of EU anti-dumping practice does not support the bullet points set out in the paper’s abstract section or the conclusions themselves.

Amendments to the Anti–dumping Agreement: The Chairman’s Dinner

In 2001 WTO Members agreed that the Anti–Dumping Agreement be included for renegotiation in the Doha Development Round. Various countries made proposals in this regard. In November 2007 the Chairman of the Committee on Anti–Dumping Practices published a draft text indicating the proposed amendments to this Agreement. This article considers the more important proposed amendments to the current text. Scrutiny of the Chairman’s text reveals that it contains several positive proposals, including the exclusion of zeroing in antidumping investigations employing the weighted average–to–weighted average methodology and limiting the overall duration of anti–dumping duties, while it also provides for greater transparency in investigations. All of this is supported. However, it also shows that the Chairman’s text provides for more protectionist use of the anti–dumping instrument than is currently the case, including expressly permitting the use of zeroing in the transaction–to–transaction methodology and in reviews. The analysis further shows that more could have been done to prevent the abuse of anti–dumping as a protectionist measure against trade that is not necessarily unfair. The article concludes by finding that the AD Agreement can be significantly strengthened through the exclusion of certain proposed amendments, the amendment of some proposals and the inclusion of proposals made by Members, but not included in the Chairman’s text.

The EC Bed Linen Dispute: India Challenges the EC's Implementation of the WTO Antidumping Agreement

The bed linen dispute provided a welcome and long overdue opportunity to throw some light on, and perhaps reign in some of the more blatant and excessive abuses of the European Commission's anti-dumping practices, which over the years, have come under repeated attack by a broad range of legal and economic commentators.