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CITAC opposes the "Continued Dumping and Subsidy Offset Act" (the so-called "Byrd Amendment") as a threat to consuming industries, their workers and to the Nation's economy. In 2005, CITAC is launching a Byrd Amendment Working Group, a multi-industry cooperative effort by U.S. companies impacted by the trade-distorting government handouts and by potentially significant retaliation against U.S. exports. The Group is focusing on repealing the Byrd Amendment as soon as possible. To join the Byrd Amendment Working Group, please see: How to Join. 2005
2004
Archive 2000-2004
"Zeroing" is a practice employed by the United States Department of Commerce in calculating antidumping duties. The higher the duties, the more of a trade barrier is erected against imports into the United States. "Dumping" measures the selling prices or cost of production for a product in the home market of the producer and compares them to prices for a comparable product in the U.S. market. If the home market price or cost of production is higher in the home market, there is a "positive" dumping margin. The average of all comparisons for the investigated product is the "weighted average dumping margin." However, if the home market price or cost of production is lower than the U.S. price, there is a "negative" dumping margin. The zeroing practice sets all negative margins equal to zero before calculating the product-wide dumping margin, inflating the amount of duties collected (and paid to petitioners under the Byrd Amendment). This practice is not in compliance with World Trade Organization rules on calculating dumping duties. The European Union, which used this policy, was successfully challenged by India and changed its practice. The U.S. practice was successfully challenged by Canada and is being challenged by several other countries. The practice not only collects more money from dumping duties than the WTO rules authorize; it also funnels that additional money, through the Byrd Amendment, to private companies that supported the petition.
Consuming industries often require imports because production in the U.S. is not sufficient to meet demand. When shortages arise, the Commerce Department and the ITC are authorized to consider whether "changed circumstances" in the market warrant a review of an outstanding antidumping or countervailing duty orders. While consuming industries are affected by antidumping and countervailing duty restrictions, they lack "standing" to participate in these cases as full parties. The Department of Commerce and the ITC, which could initiate proceedings to help consuming industries with product shortages, in practice do not initiate changed circumstances reviews requested by consuming industries. These agencies require the petitioners, the domestic parties that brought the case, to agree to a changed circumstances review before it will be initiated. In short, the consumers’ hardship is not even considered. CITAC believes that changed circumstances reviews should be available to assist consuming industries when new patterns of demand threaten to disrupt the sources of supply that American consuming industries need. We are working to confirm the authority of Commerce and the ITC to (1) initiate changed circumstances reviews due to consumer hardship; and (2) revoke or suspend antidumping and countervailing duty orders in cases where consumer hardship requires access to imported products at globally competitive prices.
UThe retrospective system of assessment and collection of antidumping and countervailing duties should be replaced, based on the uncertainty created by this system which does not consider the needs of consuming industries regarding their costs. Instead, the adoption of a "prospective" system in the United States would give consuming industries a better chance of competing successfully in the global economy. Read: Fact Sheet: Retrospective Collection of Antidumping and Countervailing Duties — Impact On Consuming Industries. January 2005.
Antidumping and countervailing duty orders are reviewed every five years, to determine if revocation of these orders would be likely to lead to recurring dumping or subsidies and injury. CITAC participates in ITC reviews to state the consumer’s point of view in securing open trade. Many more orders should lapse at the five-year point than they now do. CITAC members participate in sunset reviews at the ITC to argue in favor of opening channels of trade for the benefit of consumers. However, the law does not favor such arguments; the statute passed with the support of petitioner interests largely ignores the needs of downstream industries for globally priced and available raw materials and components. These views should be considered and factored into a decision whether to renew trade restrictions for an additional five years.
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