ANTI-DUMPING DUTY
CONTEXT
- The government has decided not to impose anti-dumping on imports of certain copper products, used in the electrical industry, from China, Thailand, Korea and three other countries.
BASICS OF ANTI-DUMPING DUTY
- Dumping is said to occur when the goods are exported by a country to another country at a price lower than its normal value. This is an unfair trade practice which can have a distortive effect on international trade.
- Anti-dumping is a measure to rectify the situation arising out of the dumping of goods and its trade distortive effect. Thus, the purpose of anti-dumping duty is to rectify the trade distortive effect of dumping and re-establish fair trade.
- The use of anti-dumping measure as an instrument of fair competition is permitted by the WTO. In fact, anti-dumping is an instrument for ensuring fair trade and is not a measure of protection per se for the domestic industry.
- The following are essential for initiating an anti-dumping investigation: –
- Sufficient evidence to the effect that;
- There is dumping;
- There is injury to the domestic industry; and
- There is a causal link between the dumping and the injury, that is to say, that the dumped imports have caused the alleged injury.
- It provides relief to the domestic industry against the injury caused by dumping.
- While the intention of anti-dumping duties is to save domestic jobs, these tariffs can also lead to higher prices for domestic consumers.
- While the intention of anti-dumping duties is to save domestic jobs, these tariffs can also lead to higher prices for domestic consumers.
WTO’S PROVISIONS RELATED TO ANTI-DUMPING DUTY
- An anti-dumping duty is valid for a period of five years from the date of imposition unless revoked earlier.
- It can be extended for a further period of five years through a sunset or expiry review investigation.