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WT/DS162/R/Add.1 Page 32

producers of the product in the importing country.  Once these facts are established, the investigating authorities may impose duties to offset prospectively the injurious dumping.


The United States considers that, while this simple definition of injurious dumping may suggest comparisons with competition laws addressing price discrimination, any careful analysis shows major differences between the antidumping rules and the competition laws.


The United States notes, first of all, that the relatively straightforward nature of the test for injurious dumping contrasts with the complexities of the imperfections in the multilateral trading system which give rise to the need for the antidumping rules in the first place.  Although some dumping may be due to business advantages and market segmentation which have arisen in response to commercial forces, more typically it is a government's industrial policies or key aspects of the national economic system which a government has created, promoted or tolerated that enables injurious dumping to take place.


The United States contends that principally of concern in this regard are certain government industrial policies or practices which in most instances are not directly or fully subject to any type of WTO prohibitions or disciplines.  In other instances, these policies or practices may not fully conform to WTO disciplines or, even if they do, may not leave all Members on an equal footing.  These policies still are objectionable because they distort market structures or processes and, as a result, provide artificial advantages to home market producers (often at the expense of home market consumers).  These artificial advantages generally translate into increased profits for these producers in their home market, which make it possible and, for various reasons, may encourage these producers to engage in injurious dumping abroad.


The United States submits that one broad category of objectionable policies can be found in government industrial policies which combine limits on domestic competition with market access barriers that keep out foreign competitors.  Here, the possible combinations are quite extensive.


In the view of the United States, the antidumping rules are a practical, albeit indirect, response to these trade-distorting policies.  The antidumping rules allow Members to respond through the imposition of offsetting duties when confronted with one harmful result of these policies, namely, injurious dumping in export markets by the producers that benefit from these policies.  From this perspective, the antidumping rules represent an effort to maintain a "level playing field" among producers in different countries.  Anti-dumping duties are designed to offset, quantitatively, the artificial advantages realized by the exporting country's producers so that producers in the importing country may compete, at least in the importing country's market, on equal footing with the exporting country's producers.


The United States considers that antidumping rules also help to neutralize inequities that may arise from differences in national economic systems, even as international trade liberalises.  For example, differing social and legal arrangements for employment and under-employment, or differing debt-equity structures and debt burdens, often made possible by indirect government intervention in the banking system, can favour the exporting country's producers over the importing country's producers and lead to injurious dumping.  Other circumstances that can lead to injurious dumping can include certain competition-inhibiting private conduct, cross-subsidization that can result from the legal organization and operation of foreign business groupings and, in the case of non-market economies or some economies in transition, export directives and prices and costs not entirely based on market principles.

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