China has won major victories against the US over methods used in determining anti-dumping duties on Chinese products.
Beijing brought the complaint before the World Trade Organization (WTO) in December 2013, challenging Washington’s way of assessing “dumping,” or exporting at unfairly cheap prices, Reuters reports.
A WTO panel found fault with the US practices of determining dumping margins in certain cases of “targeted dumping,” in which foreign firms cut prices on goods aimed at specific US regions, customer groups or time periods.
Dumping is normally found when a foreign producer’s US prices are lower than its home market prices for the same or similar goods, or when the imports are sold at prices below production costs.
The panel ruled against the US Commerce Department’s practice of “zeroing” in cases involving targeted dumping.
In zeroing, the department typically assigns a value of zero any time a producer’s export price is above that producer’s normal home market price, partly to account for freight and customs charges.
In practice, the zeroing methodology tends to increase the level of US anti-dumping duties on foreign producers, according to Reuters.
Some points of China’s argument were rejected by the WTO panel, including a claim that the Commerce Department systematically punishes Chinese state enterprise by assigning them high anti-dumping rates.
Either side can appeal the ruling within 60 days.
The report will undermine the commitment of the United States to impose anti-dumping duties to address injurious dumping,” the USTR spokesman added.
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