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Current Developments in U.S. Laws and Cases

Congress approved a bill that authorizes the Commerce Department to apply countervailing duty (CVD) trade remedies, retroactive to May, 2006, in cases of unfairly subsidized imports from nonmarket economies (NMEs) such as China and Vietnam.  It also authorizes Commerce to adjust antidumping duties on unfairly traded NME imports on which CVD penalties are imposed if it can be shown that domestic subsidies have inflated the dumping margin, and if the Commerce Department is able to estimate an adjustment.

Click here to see the changes that the law makes to the CVD law, and here for the corresponding changes to AD law.

The Senate approved the bill (S.2153/H.R.4105) by unanimous consent on March 5; the House followed the next day, passing it by a vote of 370-39.

This legislative “fix” became necessary, in the view of its supporters, by a ruling of the Court of Appeals for the Federal Circuit last December in GPX Int’l Tire Corp. v. United States. The court found that CVD law is not applicable to imports from NMEs. In that decision the court relied heavily on the legislative intent of Congress, finding that —

in amending and reenacting the trade laws in 1988 and 1994, Congress adopted the position that countervailing duty law does not apply to NME countries. Although Commerce has wide discretion in administering countervailing duty and antidumping law, it cannot exercise this discretion contrary to congressional intent.

By enacting this new law, Congress has in effect rebutted the court’s interpretation of its intent. Whether or not it meant to do so in 1988 and 1994, Congress has sided with the petitioners and Commerce Department officials who believe that NME status offers no protection from CVD action.

Another bill that the Senate approved and is awaiting action in the House of Representatives would provide for the application of CVDs against imports from countries that manipulate their currencies. For an analysis of this bill, its prospects, and the larger disputes in which it is a part see WTR Vol.28 No.11 (April 2, 2012).

:: Trade-Remedies and Disputes in the WTO :: U.S. Trade-Remedy Laws :: U.S. Reciprocity Laws

The principal trade-remedy and dispute articles of GATT 1947 are VI (antidumping and countervailing duties), XIX (safeguards), XX (general exceptions), XXI (security exceptions), XXIII (nullification or impairment), and XXXV (non-application, now replaced by Article XIII of the WTO Agreement).

Today the most important WTO instrument in this field is the Understanding on Rules and Procedures Governing the Settlement of Disputes, more commonly known as the Dispute Settlement Understanding (or DSU). Other key agreements in WTO law dealing with this subject matter are the following:

 


For status reports on the state of negotiations on these issues in the Doha Round see the April, 2011 reports of the chairs of the Dispute Settlement Body-Special Session and the Negotiating Group on Rules (Word documents).


These are the main U.S. trade-remedy laws:

Other laws have been largely superceded by other laws or agreements or are otherwise rarely invoked:

While the term "reciprocity" is taken in the WTO to mean the overall balance of concessions that countries make to one another, in the United States it is used to mean laws that can lead to the threat or imposition of sanctions on countries that are found to violate U.S. trade rights.

The principal U.S. reciprocity laws are as follows:

See also the 2012 executive order creating the Interagency Trade Enforcement Center.