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US to abolish zeroing in anti-dumping probe

2nd March, 2012

USA’s method of zeroing while calculating the anti-dumping duty rates has been disputed for long and held as inconsistent with the Anti-dumping Agreement of the WTO by various DSB panels. Now, as per developments last month, US is likely to amend its law and has signed an MOU with Japan and EU in this regard thereby bringing to end long pending disputes in DS322, DS294 and DS350. It is also in the process of arranging discussions with Brazil on this issue.

While calculating ADD in review investigations, the US had been rejecting the transactions (holding them as equal to zero) where the price of the product in the domestic market of the exporter was lower than the price in the U.S. market. This had led to increase in the ADD rates, as otherwise dumping is calculated by comparing average domestic and export prices. The US had, in December, 2010, published a notice by means of which it had proposed to amend its law to abandon use of zeroing in the administrative reviews and this notice is now set for adoption after some modifications.
Interestingly, Korea’s request for establishment of DSB panel for studying USA’s anti-dumping measures on corrosion-resistant carbon steel flat products from Korea (DS420) has been accepted by the WTO DSB Committee on 22-2-2012. The dispute concerns several US laws, regulations, administrative proceedings and practices, related to the use of “zeroing” methodology in anti‑dumping determinations concerning the said products. Further, Vietnam has also sought consultations with the US on the latter’s said provisions in relation to US ADD on certain warm water shrimps from Vietnam (DS491).
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