Legal Framework

If the NME exporter adequately demonstrates that its export activities are not controlled by the NME government, the Commerce Department will normally calculate an anti-dumping margin for that exporter.

What is a subsidy?

08/12/2022

The United States countervailing duty law has a very long history - it is even older than the anti-dumping law.

The term 'financial contribution' is explicitly defined under the statute, and includes, but is not limited to, four common types of practices used by governments to assist industries located within their borders.

The mere existence of a government programme providing a financial contribution is not enough to constitute a subsidy.

Even though certain government-provided programmes or benefits meet the technical definition of a subsidy under United States law as discussed above, this is not the end of the analysis.

Red light subsidies

08/12/2022

Red light subsidies are subsidies whose very nature makes them intolerable and automatically actionable.

In contrast to the outright prohibited red light subsidies, the WTO SCM Agreement establishes a second tier of actionable subsidies known as yellow light subsidies.

The third type of subsidy under the SCM Agreement is a green light subsidy. Green light subsidies are non-actionable by WTO Members even though they might otherwise be considered countervailable.

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