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Trade Under Trump: Big Changes May be Ahead for Antidumping Rules

More Self-Initiated AD/CV Cases, Export Enforcement Under Budget Proposal

Thursday, May 25, 2017
Sandler, Travis & Rosenberg Trade Report

President Trump’s fiscal year 2018 budget proposal includes additional resources for the International Trade Administration that would be focused on self-initiating antidumping and countervailing duty cases. The Bureau of Industry and Security would also see a funding increase to boost its enforcement capabilities.

The ITA has the authority to self-initiate AD and CV duty investigations whenever it determines, based on the information available to it, that a formal investigation is warranted and that special circumstances exist to justify a self-initiation. However, U.S. law requires evidence of dumping or the necessary legal elements of a countervailable subsidy as well as evidence that the U.S. industry is suffering injury caused by the dumped or subsidized imports, requirements that can take substantial resources to meet. The ITA’s enforcement and compliance division is therefore working to build capacity to more fully utilize self-initiation when it may be appropriate; e.g., when shifting production sources, duty evasion or circumvention, fragmented domestic industry, or the threat of retaliation by the exporting country might make it more difficult for U.S. companies to bring AD or CV duty cases on their own.

The proposed budget would aid this effort by giving E&C an additional $4.5 million to fund 22 new full-time equivalent positions dedicated to identifying potential industries and products on which AD and CV duty investigations could be self-initiated as well as gathering, analyzing, and developing the required factual information and legal justification. The additional funding would also help E&C increase the number of individual companies it may examine and conduct more, and more vigorous, on-site verifications, thus increasing the division’s ability to “detect and expose” practices foreign companies employ to circumvent or evade AD and CV duties.

In addition, the proposed budget would increase funding for the BIS to enhance its export control investigations and enforcement capabilities. This would include an additional $3.8 million and 19 special agents to increase export enforcement operations to “make certain that that sensitive U.S.-owned technology does not fall into the wrong hands.” Additional funding would also allow the BIS to handle the additional workload resulting from the transfer of tens of thousands of items from the U.S. Munitions List to the Commerce Control List. For example, Commerce Secretary Wilbur Ross said, the volume of BIS processed export licenses increased 42 percent between FY 2013 and FY 2017.

On the other hand, the ITA’s overall budget would be reduced from $483 million to $442.5 million and 157 FTE positions would be eliminated. The global markets program would see a loss of $43.5 million and 136 FTE positions as about 35 smaller international posts and ten U.S. Export Assistance Centers are closed and headquarters staff is reduced to rescale export promotion, investment, and trade analysis efforts. The industry and analysis program would lose $3.7 million and 17 FTE positions as the Office of Trade Promotion Programs is eliminated and other offices and functions are streamlined.

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