An anti-dumping or countervailing duty investigation is an administrative proceeding through which two United States Government agencies — the United States Department of Commerce (the Commerce Department) and the United States International Trade Commission (the Commission) — decide whether unfairly traded imports are injuring a United States industry.

 

The Commerce Department handles the part of the investigation that determines whether the imports are unfairly priced — whether they are being sold at 'less than fair value', otherwise known as 'dumping' — or being sold with the benefit of impermissible government subsidies. The dozens of complicated issues that arise in trying to make the fair value or subsidy determinations are resolved only at the end of the long and complex Commerce Department phase of the investigation.

 

The International Trade Commission (an independent, quasi-judicial agency, whose six Commissioners serve nine-year terms) handles the other part of the investigation, and determines whether a United States industry is suffering `material injury by reason of imports, or is threatened with material injury. The two key aspects of this legal test — whether there is 'material injury' and whether it is 'by reason of' imports — are discussed in more detail in later chapters. For present purposes, the important point is that two parallel investigations take place in anti-dumping and countervailing duty investigations. If a foreign producer is successful in either the dumping/countervailing duty or injury investigation, no and-dumping order will be issued.

 

This bifurcated approach is somewhat unique to the United States. Most countries have a single administering authority that considers both issues, decides the dumping or subsidy margin, and also decides whether there is injury caused by unfair trade imports. The United States separates these two functions, largely for historical reasons, but also in an effort to give more independence to the International Trade Commission.

 

Source: Business Guide to Trade Remedies in the United States: Anti-dumping, countervailing and safeguards legislation practices and procedures