Countervailing duties

Part of a series on
World trade
Policy Import Export Balance of trade Trade law Trade pact Trade bloc Trade creation Trade diversion Export orientation Import substitution Trade finance Trade facilitation Trade route Domestic trade Tax
Restrictions Trade barriers Tariffs Non-tariff barriers Import quotas Tariff-rate quotas Import licenses Customs duties Export subsidies Technical barriers Bribery Exchange rate controls Embargo Safeguards Countervailing duties Anti-dumping duties Voluntary export restraints
History Mercantilism Protectionism Laissez-faire Free trade Economic nationalism Economic integration
Organizations International Monetary Fund International Trade Centre World Trade Organization World Customs Organization International Chamber of Commerce
Economic integration Preferential trading area Free-trade area Currency union Customs union Single market Economic union Fiscal union Customs and monetary union Economic and monetary union
Issues Intellectual property rights Smuggling Competition policy Government procurement Outsourcing Globalization Fair trade Trade justice Emissions trading Trade sanctions War Currency war Trade costs Trade war Trade and development
Lists Imports Exports Tariffs Largest consumer markets Leading trade partners
By country Trade mission Trading nation United States Argentina Pakistan Romania Vietnam India
Theory Comparative advantage Competitive advantage Heckscher–Ohlin model New trade theory Economic geography Intra-industry trade Gravity model of trade Ricardian trade theories Balassa–Samuelson effect Linder hypothesis Leontief paradox Lerner symmetry theorem Terms of trade
v t e

Countervailing duties (CVDs), also known as anti-subsidy duties, are trade import duties imposed under World Trade Organization (WTO) rules to neutralize the negative effects of subsidies. They are imposed after an investigation finds that a foreign country subsidizes its exports, injuring domestic producers in the importing country. According to World Trade Organization rules, a country can launch its own investigation and decide to charge extra duties, provided such additional duties are in accordance with the GATT Article VI and the GATT Agreement on Subsidies and Countervailing Measures.

Since countries can rule domestically whether domestic industries are in danger and whether foreign countries subsidize the products, the institutional process surrounding the investigation and determinations has significant impacts beyond the countervailing duties.

Countervailing duties in the U.S. are assessed by the International Trade Administration of the U.S. Department of Commerce which determines whether imports in question are being subsidized and, if so, by how much. If the U.S. International Trade Commission determines that there is material injury to the competing domestic industry, the Department of Commerce will instruct U.S. Customs and Border Protection to levy duties in the amount equivalent to subsidy margins.

Petitions for remedies may be filed by domestic manufacturers or unions within the domestic industry, but the law requires that the petitioners represent at least 25% of the domestic production of the goods for which competition is causing material injury.

This page was last edited on 9 March 2024, at 11:04