ANTI-DUMPING: A NEW SOLUTION

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ANTI-DUMPING A NEW SOLUTION

• Presented by
• Catalina GuáquetaFarida KerouaniAdrian Senyszyn

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Anti-Dumping

• Explanation
• Proposal
• Broader Implications
• Futures Challenges
• Bibliography

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What is Anti-Dumping?

• Article VI of GATT 1994
• A product is said to be dumped when its export
  price is less than its normal value, that is less
  than the sale of a like product in the domestic
  market in the exporting country.

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Anti-Dumping Litigation

• World Trade Organization
• Countries are responsible for bringing a case to
  the WTO Dispute Resolution System.
• U.S. Court of International Trade
• Commerce Department determines if anti-dumping
  occurred.
• International Trade Commission (ITC) determines
  if material injury occurs.

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Anti-Dumping Globally

• Anti-dumping measures taken by WTO members have
  increased from 129 in 1994 to 236 in 2000 83.
• Dec. 2000 - 1119 anti-dumping measures in place
  globally.
• New users Argentina, India, Brazil, South
  Africa.
• Traditional users Canada, U.S., European Union,
  Australia, Mexico.
• Most affected industries Metal, Chemical,
  plastic, textiles, machinery and equipment,
  agriculture and food.

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Most Affected Sectors
Source WTO Secretariat, Rules Division
Anti-dumping Database
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Anti-Dumping Measures
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Statistics (January - June 2002)

• 30 less investigations for this period in
  comparison with last year at the same period of
  time.
• 37 cases initiated by developed countries and 63
  by developing countries.
• So far we have the similar trend for steel and
  chemical sectors.
• Out of 22 AD initiations in the US 16 involved
  metal products.

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U.S. As Complainant

• 1 of 59 complaints made by the U.S. were related
  to anti-dumping.
• Case Mexico Anti-Dumping Duties on High
  Fructose Corn Syrup
• U.S. prevailed in litigation.

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U.S. As Respondent

• 7 of 69 cases that have been brought against the
  U.S. are related to anti-dumping.
• Case lost Anti-dumping Steel plate from India.
• 6 of 8 cases in consultations are Anti-dumping
  related.

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Impact of Anti-Dumping Laws

• Pros
• Prevents Monopolies
• Protects Vulnerable Industries
• Allows Firms Time to Compete
• Preserves Jobs

• Cons
• Against Free Trade Concept
• Trade Barrier Lowers Economic Growth
• Distorts the Market
• Protects Firms from Competition
• Hurts Consumers

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Proposal

1. Reform Anti-dumping procedure in the U.S.
2. Negotiate minor changes to the WTO Anti-dumping
   Agreement.

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Reform the U.S. Anti-Dumping Law

• Department of Commerce must review the concept of
  anti-dumping.
• Review the methodology of anti-dumping.
• ITC must define material injury and be a more
  partial judge.
• Material injury is broad and subject to
  interpretation.
• Congress must ensure that the ITC is cognizant of
  WTO negotiated agreements.

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Changes to WTO Agreement

• Penalize WTO members for abuse of anti-dumping
  law.
• Amend article 9, Imposition and Collection of
  Anti-Dumping Duties
• Negotiate the industry specific, incremental
  decrease of anti-dumping laws globally.
• Revise article 11, Duration and Review of
  Anti-Dumping and Price Undertakings.
• Tie in to a compromise on IPR agreements, or
  other U.S. interests.

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Stakeholders

• In Favor
• Consumers
• Exporters
• WB/IMF
• Economists
• Regional Agreements (NAFTA)

• Against
• US currently protected industries
• US Labor Unions (AFL/CIO)
• Countries who want to protect their domestic
  market

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Benefits for the U.S.

• Reduce the number of cases brought against the
  U.S.
• U.S. wins as a Complainant, and loses as a
  Respondent.
• Better defense in anti-dumping cases.
• U.S. law closer to WTO agreements.
• Hold other nations accountable.

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Broader Implications

• Increase competition, which will increase
  productivity and efficiency.
• Greater economic prosperity for all WTO members.
• Lower prices for consumers.
• Higher national income.

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Future Challenges

• Negotiating a change to WTO anti-dumping
  agreements.
• Altering the Dispute Settlement System to award
  damages.
• Convincing the American public that reform is
  critical for continuing U.S. success.

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Bibliography

•  1 Harvard International Review. National
  Sovereignty in the World Trading System. Winter
  2001.
• The Economist. Our Law, Your Law. June 27, 2002
• Association for Consumer Research. Global Trade
  Policy Agenda for Change. September/October
• 2001.
• 4 President George W. Bush. Remarks by The
  President at Signing of the Trade Act of 2002.
  August 6,
• 2002.
• Chemical Week. Trade Barriers Start to Fall
  Following WTO Entry. September 4, 2002.
• 6 Director General Supachai Panitchpakdi.
  Trade and Sustainable Development The Doha
  Development
• Agenda. Johannesburg, South Africa.
  September 3, 2002.
• The Financial Times. Playground Rules that
  Promote Protectionism. September 3, 2002.
• The Economist. The Dumping Dilemma. May 30,
  2002.