ANTI-DUMPING AND COUNTERVAILING DUTY U.S. Customs and Border Protection

Anti-dumping and Countervailing Defined Occurs when a foreign producer sells a product in the United States at a price that is below that producer’s sales price in its home market, or at a price that is lower than its cost of production. The foreign producer is selling the merchandise at less than fair value. Countervailing Occurs when a foreign government provides financial assistance to benefit the production, manufacture, or exportation of a good. The foreign government is subsidizing the foreign producer. ADD: Company Specific CVD: Country Specific and Industry Wide in Scope U.S. Customs and Border Protection

What is AD/CVD? Additional duties assessed by CBP on imported merchandise subject to either an anti-dumping duty (ADD) or countervailing duty (CVD) order. These additional duties are designed to offset the competitive advantages that some foreign companies may gain by dumping goods, or advantages derived from foreign government subsidies. AD/CV duties equal the amount the DOC has determined to be the difference between the sale price to the U.S. and the foreign market value of such or similar merchandise at the time the merchandise was sold or exported to the United States. ADD: Requires positive determination of injury CVD: Requires positive determination of subsidy (may or may not require a determination of injury) U.S. Customs and Border Protection

Why AD/CVD Is Important U.S. jobs may be lost Domestic industries may be harmed Our nation’s economy is threatened U.S. Customs and Border Protection

Parties Involved with AD/CVD The Department of Commerce (DOC) International Trade Administration (ITA) The International Trade Commission (ITC) U.S. Customs and Border Protection

The Department of Commerce The DOC is responsible for: Investigating to determine if sales at less than market value are being made; Determining rates for AD/CVD duties; Defining the scope of the order; Creating cases; Issuing and updating messages and Clarifying messages Investigates foreign companies U.S. Customs and Border Protection

The International Trade Commission The ITC conducts investigations in concert with the DOC to determine whether the domestic industry has been injured in AD/CVD cases. Focus is on domestic industry U.S. Customs and Border Protection

Stages in the AD/CVD Process 1) Investigation initiated 2) Preliminary injury determination issued by ITC If no If yes 3) Final determination issued by DOC If no If yes 4) Final injury determination by ITC If no If yes 5) Order issued by ITA (DOC) If no If yes 6) Suspension agreements negotiated If no If yes Steps 7 and 8 repeated until case ends 7) Administrative Review initiated If no U.S. Customs and Border Protection 8) Liquidation initiated 9) Investigation Terminated

Flow Chart for AD/CVD Investigations Day 20 45 85 CVD 160 ADD 160 CVD 235 ADD 205 CVD 280 ADD 212 CVD 287 ADD Milestone Petition filed Decision on initiation Preliminary injury determination by ITC Preliminary determination by DOC (CBP begins suspension of liquidation) Final determination by DOC Final injury determination by ITC Publication of order in Federal Register (cash-only deposits required) Time frames are imposed by statute U.S. Customs and Border Protection

Initiation of an AD/CVD Case A petition is filed with the ITC alleging injury to an industry in the U.S. Petitions may be filed with ITC and DOC by: a U.S. manufacturer a trade/business association of manufacturers in the U.S. a recognized labor union or group of workers who represent the industry Importers cannot file a petition U.S. Customs and Border Protection

Investigation The ITC will conduct an investigation, in concert with the DOC, to determine whether the domestic industry has been injured by AD/CVD cases The ITA is the specific agency within the DOC that will conduct the investigation to determine whether goods are sold at less than fair value or whether a foreign government subsidy has been provide to foreign exporters U.S. Customs and Border Protection

Preliminary Determination When a reasonable indication of injury is found, the preliminary determination is issued. If the ITC finds that there is no material injury to U.S. industry, the case is terminated, if a reasonable indication of injury is found, the case continues If the DOC finds positive results, CBP withholds liquidation and charges AD/CVD suggested by DOC If the DOC investigation is negative, CBP takes no action and the case continues and further information is sought until a final determination is made by DOC Bonds are accepted U.S. Customs and Border Protection

Final Determination If either the ITC or DOC find negative results – the case is cancelled If DOC findings are affirmative – Liquidation Suspension is ordered and final AD/CVD rates are issued The Final Order is published in the Federal Register and AD/CVD rates are deposited in cash The entries will remain suspended for a minimum of one year U.S. Customs and Border Protection

Administrative Review Requested by either the petitioner or the respondent Requested during the anniversary month of the order Used to establish final AD/CVD rates If not requested, the entries liquidate at the AD/CVD rate required at the time of entry May be requested every year or may not be requested for several years U.S. Customs and Border Protection

Liquidation Entries are not liquidated until liquidation instructions are issued by DOC Entries must be liquidated within 6 months from the date the notice of the suspension of liquidation is published in the Federal Register If entries are not liquidated within this time frame, the entries deem liquidate U.S. Customs and Border Protection

Reimbursement Statements States whether the importer has entered into any agreements for reimbursement of the anti-dumping duty paid 19 CFR 353.55 requires the filing of the certificate If the Reimbursement Statement is not presented prior to liquidation, antidumping duties are doubled plus interest per 19 CFR 351.402(f)(2) Although the DOC law provides for a Reimbursement Statement for both AD and CVD cases, to date, they have not required them for CVD case U.S. Customs and Border Protection

Injunctions A court order that either prohibits or compels (“enjoins” or “restrains”) a party from continuing a particular activity. Stops the liquidation of entries Importer has 30 days after the date of the publication of the final results of an Administrative Review by DOC in the Federal Register in which to file a summons with the court challenging the results U.S. Customs and Border Protection

Bond Sufficiency Bonds are accepted only in the preliminary stage of the AD/CVD case A Single Entry Bond (SEB) may be posted for estimated AD/CVD in addition to any other bond for entry requirements If the amount of the estimated AD/CVD is less than 5% ad-valorem, a continuous transaction bond may be posted to cover the AD/CVD and all other entry bonding requirements Continuous Bond Calculation: 10% duties, taxes and fees paid the previous 12 months + DOC rate x import value of merchandise for previous 12 months Once the AD/CVD case becomes and order only cash deposit may be posted U.S. Customs and Border Protection

The Meaning of the AD/CVD Case Number Represents the type of duty A for Anti-dumping C for Countervailing Commodity Code Exporter or Manufacturer Code Country Code U.S. Customs and Border Protection

QUESTIONS ? U.S. Customs and Border Protection