dumping with examples and case studies
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Introduction
The concept of “dumping” in international trade has a long history. Dumping, less than one
name or another has been part of the rhetoric of political economy for a long time. Jacob
Viner, the first scholar to pull together previous writings on the subject of dumping, noted a
sixteenth‐century English writer who charged foreigners with selling paper at a loss to
smother the infant paper industry in England. Viner also noted an instance in the seventeenth
century in which the Dutch were accused of selling at low prices in the Baltic regions in order
to drive out French merchants. He further noted statements made by Alexander Hamilton in
debates in the USA in 1791 warning about foreign country practices of underselling
competitors in other countries so as to “…frustrate the first efforts to introduce a business
into another by temporary sacrifices, recompensed, perhaps by extraordinary
indemnifications of the government of such country…”
Hamilton further declared that the greatest obstacle encountered by new industries in a
young country was the system of export bounties, which foreign countries maintained in
order to “enable their own workmen to undersell and supplant all competitors in countries to
which these commodities are sent.”
Definition:-
In economics, "dumping" is a kind of predatory pricing, especially in the context
of international trade. It occurs when manufacturers export a product to another country at a
price either below the price charged in its home market, or in quantities that cannot be
explained through normal market competition.
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The definition of dumping according to GATT is:
The sale of products for export at a price less than the normal value where normal value
means roughly the price for which those same products are sold on the home or exporting
market.
The concept of dumping seems fair because it is recognized that producers may sell their
goods in different markets at different prices and that prices of a goods are influenced by
several market forces and may vary at different times. It may be a perfectly legitimized
business activity like discounts offered by airlines to students or senior citizens etc. There
may not seem anything intrinsically unethical or illegal about dumping.
Meaning:-
Dumping is an international price discrimination in which an exporter firm sells a portion of
its output in a foreign market at a very low price and remaining output at a high price in the
home market. Haberler defines dumping as: “The sale of goods abroad at a price which is
lower than the selling price of the same goods at the same time in the same circumstances at
home, taking account of differences in transport costs.” Viner’s definition is simple.
According to him, “Dumping is price discrimination between two markets in which the
monopolist sells a portion of his produced product at a low price and the remaining part at a
high price in the domestic market,” Besides, Viner explains two other types dumping. One,
reverse dumping in which foreign price is higher than the domestic price. This is done to turn
out foreign competitors from the domestic market. When the product is sold at a price lower
that cost of production in the domestic market, it is called reverse dumping. Two, when there
is no consumption of the commodity in the domestic market and it is sold in two different
foreign markets, out of which one market is charged a high price and the other market a low
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price. But in practice, dumping means selling of a product at high price in the domestic
market and a high price in the foreign market.
Overview:-
A standard technical definition of dumping is the act of charging a lower price for a good in a
foreign market than one charge for the same good in a domestic market. This is often referred
to as selling at less than "fair value". Under the World Trade Organization (WTO)
Agreement, dumping is condemned (but is not prohibited) if it causes or threatens to cause
material injury to a domestic industry in the importing country.
The term has a negative connotation, as advocates of competitive markets see
"dumping" as a form of protectionism. Furthermore, advocates for workers and laborers
believe that safeguarding businesses against predatory practices, such as dumping, help
alleviate some of the harsher consequences of such practices between economies at different
stages of development. The Bolkestein directive, for example, was accused in Europe of
being a form of "social dumping," as it favored competition between workers, as exemplified
by the Polish Plumber stereotype. While there are very few examples of a national scale
dumping that succeeded in producing a national-level monopoly, there are several examples
of dumping that produced a monopoly in regional markets for certain industries. Ron Chenow
points to the example of regional oil monopolies in Titan: The Life of John D. Rockefeller,
Sr. where Rockefeller receives a message from Colonel Thompson outlining an approved
strategy where oil in one market, Cincinnati, would be sold at or below cost to drive
competition's profits down and force them to exit the market.
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Objectives of Dumping:-
1. To enter into a foreign market dumping may be resorted to make an entry in a foreign
market with subsidies being provided by the government
2. To dispose of occasional surplus at a lower price in foreign markets
3. To develop a market in foreign countries by selling at a lower price in the initial
stages just as new markets van be developed in the country itself by selling at lower
prices.
4. A monopolist also resorts to dumping for the expansion of his industry. When he
expands it, he receives both internal and external economies which lead to the
application of the law of increasing returns. Consequently, the cost of production of
his commodity is reduced and by selling more quantity of his commodity at a lower
price in the foreign market, he earns larger profit
5. The monopolist practices dumping in order to develop new trade relations abroad. For
this, he sells his commodity at a low price n the new market, thereby establishing new
market relations with those countries. As a result, the monopolist increases his
production, lowers his costs and earns more profit.
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Effects of dumping:-
On the importing country
1. Domestic industry might be affected adversely by a decline in sales and profits.
2. If dumping is continued for a longer period, survival of the domestic industry may
be threatened.
3. Dumping may create balance of payments problems for the country subjected
dumping.
On the Exporting Country
1. It must be presumed that a producer who dumps benefits from doing so,
although in the case of promotional and predatory dumping, there is an
element of risk in that the ultimate benefits, on which the loss‐making export
sales are premised, may not materialize.
2. Provided its home market is shielded against arbitrage or retaliation, and
consequent price drop (which would neutralize the discrimination), dumping
can have clear advantages for the individual exporter.
3. A profitable home market provides a platform which may be used to operate
in export markets at prices much lower than could have been possible without
market segregation.
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4. The low export prices generate further sales which in turn lower the cost of
production, an advantage which benefits both export and home sales.
5. Dumping can still have beneficial effects on the dumper even in situations
where home market sales are made at a loss.
6. As long as the dumper covers fixed costs, export sales can be priced as low as
variable cost, a strategy which permits production and employment to be
maintained in a recession or enables the dumper to obtain considerable
advantages when going for economies of scale.
Advantages of Dumping:-
The main advantage of dumping is being able to sell at unfairly competitive lower price.
Generally a country will have to give the exporting businesses a huge subsidy to enable them
to sell the export below cost. The country is willing to take a loss on the product to increase
its comparable advantage in that industry. It may do this because it wants to create jobs for its
residents. It often uses dumping as an attack on the other country's industry, in the hopes of
putting that country's producers out of business, and dominating that industry.
Disadvantage of Dumping:-
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The main disadvantage of dumping is that it's very expensive to maintain. It can take years
for dumping to work. Meanwhile, the cost of subsidies can add to the export country's
sovereign debt. The second disadvantage is retaliation by the trade partner. This can lead to
trade restrictions and tariffs. The third is censure by international trade organizations, such as
the World Trade Organization (WTO) or the European Union (EU).
Types of dumping:-
Sporadic Dumping : Occasional sale of a commodity at below cost in order to unload
an unforeseen and temporary surplus of the commodity without having to reduce
domestic prices.
Predatory Dumping : Temporary sale of a commodity at below cost or a lower price
abroad in order to derive foreign producers out of business, after which prices are
raised to take advantage of the monopoly power abroad.
Persistent Dumping : Continuous tendency of a domestic monopolist to maximize total
profits by selling the commodity at a higher price in the domestic market than
internationally (to meet the competition of foreign rivals). For international price
discrimination to take place, conditions must be met:
o Domestic and foreign markets must be separated.
o Demand elasticity of the product must be different in two markets. The good
can be sold with a lower price where the demand elasticity is high; and with a
higher price where demand elasticity is low.
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Historical Dumping Country wise
Dumping by Germany:-
There is general agreement that before 1914, export dumping was more widespread and more
systematically practiced in Germany than any other country. The resort to export dumping by
Germany seems to have been facilitated by the high tariffs and by the complete organization
of large scale industry into cartels or industrial selling and buying combinations. These two
factors monitored price competition in the domestic market. Cartels monitored price
competition from outside Germany and the combinations monitored the German producers
themselves. In concert, they made it possible for many of the cartels to adopt as a definite
price policy the maintenance of domestic prices at the foreign level plus the full amount of
the German import duties and the sale for exports at best prices obtainable, even if these
should be substantially below domestic prices. It is obvious that systematic and continued
dumping is not likely to arise if the dumping concern must share the higher domestic prices
with the competitors and must bear by itself the cost of the export dumping.
The cartel method in Germany provided the machinery whereby, without the loss of
individuality of the separate concerns, the benefits and burdens of export dumping could be
equitably distributed among the domestic producers. The effects of the protective tariff were
such that foreign competitors were prevented from sharing in the high domestic prices
resulting from the price fixing activities of the cartels. However, export dumping by German
industries and especially by the iron and steel trade began in the nineteenth century, long
before the establishment of cartels. Since 1914, writers have always made the charge hostile
to Germany and all her works that much of the German dumping was actuated by predatory
motives. Some writers have gone so far as finding “a manifestation of a deep laid conspiracy
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between the German government and industry to destroy the competing industries of foreign
countries.”
Dumping in the United States of America:-
Since the late eighties of the nineteenth century, export dumping on a continued and
systematic scale has been a common practice of American manufacturers. There is according
to Viner, immeasurable evidence available both in official and nonofficial sources, which is
conclusive in this respect, and which further demonstrates beyond doubt that a substantial
fraction of the American export trade in manufactured commodities had, before 1914, been
developed and maintained on the basis of sale at dumping prices. The abundance of evidence
is more significant and convincing because American exporters who resorted to dumping
generally endeavored to conceal their export prices from the general public. Export price lists
and quotations were carefully kept out of domestic circulation. In 1902, a Committee of the
Democratic Party seeking campaign material succeeded in obtaining from a foreign
subscriber a copy of the discount sheet of an American journal, which contained the lowest
export prices. A New York Tariff Reform pamphlet, published in 1890, presented many
instances of dumping. What followed was a buildup of evidence of the prevalence of
dumping.25 In the USA, the systematic and continued practice of dumping appears to have
been largely either confined to the dominant concerns (trusts) of the staple industries or to
manufacturers of specialties. In other countries, and especially Germany, even the smallest
concerns participated in exportation at reduced prices through their membership in cartels or
producer’s combinations and through the use of export bounties.
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Antidumping and Its purpose on International trade ( For Reference) :
Dumping is said to occur when the goods are exported by a country to another country at a
price lower than its normal value. This is an unfair trade practice which can have a distortive
effect on international trade. Anti dumping is a measure to rectify the situation arising out of
the dumping of goods and its trade distortive effect. Thus, the purpose of anti dumping duty
is to rectify the trade distortive effect of dumping and re-establish fair trade. The use of anti
dumping measure as an instrument of fair competition is permitted by the WTO. In fact, anti
dumping is an instrument for ensuring fair trade and is not a measure of protection per se for
the domestic industry. It provides relief to the domestic industry against the injury caused by
dumping.
While permitted by the WTO, General Agreement on Tariffs and Trade (GATT)
(Article VI) allows countries the option of taking action against dumping. The Anti-Dumping
Agreement clarifies and expands Article VI, and the two operate together. They allow
countries to act in a way that would normally break the GATT principles of binding a tariff
and not discriminating between trading partners—typically anti-dumping action means
charging extra import duty on the particular product from the particular exporting country in
order to bring its price closer to the “normal value” or to remove the injury to domestic
industry in the importing country.
There are many different ways of calculating whether a particular product is being
dumped heavily or only lightly. The agreement narrows down the range of possible options.
It provides three methods to calculate a product’s “normal value”. The main one is based on
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the price in the exporter’s domestic market. When this cannot be used, two alternatives are
available—the price charged by the exporter in another country, or a calculation based on the
combination of the exporter’s production costs, other expenses and normal profit margins and
the agreement also specifies how a fair comparison can be made between the export price and
what would be a normal price.
Procedures in investigation and litigation:-
Detailed procedures are set out on how anti-dumping cases are to be initiated, how the
investigations are to be conducted, and the conditions for ensuring that all interested parties
are given an opportunity to present evidence. Anti-dumping measures must expire five years
after the date of imposition, unless a review shows that ending the measure would lead to
injury.
Generally speaking, an anti-dumping investigation usually develops along the following
steps: domestic producers make a request to the relevant authority to initiate an anti-dumping
investigation. Then investigation to the foreign producer is conducted to determine if the
allegation is valid. It uses questionnaires completed by the interested parties to compare the
foreign producer's (or producers') export price to the normal value (the price in the exporter’s
domestic market, the price charged by the exporter in another country, or a calculation based
on the combination of the exporter’s production costs, other expenses and normal profit
margins). If the foreign producer's export price is lower than the normal price and the
investigating body proves a causal link between the alleged dumping and the injury suffered
by the domestic industry, it comes to a conclusion that the foreign producer is dumping its
products. According to Article VI of GATT, dumping investigations shall, except in special
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circumstances, be concluded within one year and in no case more than 18 months after
initiation. Anti-dumping measures must expire five years after the date of imposition, unless
a review shows that ending the measure would lead to injury.
Anti-dumping investigations are to end immediately in cases where the authorities
determine that the margin of dumping is, de minimis, or insignificantly small (defined as less
than 2% of the export price of the product). Other conditions are also set. For example, the
investigations also have to end if the volume of dumped imports is negligible (i.e., if the
volume from one country is less than 3% of total imports of that product—although
investigations can proceed if several countries, each supplying less than 3% of the imports,
together account for 7% or more of total imports).
The agreement says member countries must inform the Committee on Anti-Dumping
Practices about all preliminary and final anti-dumping actions, promptly and in detail. They
must also report on all investigations twice a year. When differences arise, members are
encouraged to consult each other. They can also use the WTO’s dispute settlement procedure.
Measures of Antidumping:-
Dumping must be distinguished from simple practices of low-price sales resulting from lower
costs or greater productivity. The key criterion in this respect is not, in fact, the relationship
between the price of the exported product and that on the market of the country of import, but
the relationship between the price of the exported product and its normal value. A product is
therefore considered to be dumped if its export price to the European Union (EU) is less than
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the comparable price for a like product established in the ordinary course of trade within the
exporting country.
The normal value to be taken into account to determine if there is dumping is usually
based on the prices paid or payable, in the ordinary course of trade, by independent customers
in the exporting country.
However, where the exporter in the exporting country does not produce or does not sell a
like product, the normal value may be established on the basis of prices of other sellers or
producers. In addition, when there are no or insufficient sales of the like product in the
ordinary course of trade (for example, sales by a company with a monopoly) or where
because of the particular market situation such sales do not permit a proper comparison, the
normal value may be calculated on the basis of the cost of production in the country of origin.
In the case of imports from non-market economy countries, the normal value is
determined on the basis of the price or constructed value in a market economy third country,
or the price from this country to other countries, or where those are not possible, on any other
reasonable basis.
The second basis of comparison, the relationship with the normal value in the country of
origin which determines the dumping margin, is the export price. This is the price actually
paid or payable for the product when sold for export to the EU.
In cases where there is no export price or where the price is set under an association or a
compensatory arrangement between the exporter and the importer or a third party, any
reference to the export price becomes impossible. It may therefore be constructed on the basis
of the price at which the imported products are first resold to an independent buyer, or, if the
products are not resold to an independent buyer, or are not resold in the condition in which
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they were imported, on any reasonable basis. In these cases, adjustments are made to take
account of all costs incurred between importation and resale as well as for profits accruing.
India tops list of Final anti-dumping measures: WTO
India initiated the largest number of fresh anti-dumping investigations and final measures
while there has been a sharp drop worldwide in the number of new probes during January and
June 2007, a WTO report has said.
Among the 150 WTO members, India tops the chart of applications of final anti-dumping
measures with 16 cases, which is exactly the double of eight new measures it reported during
the corresponding period in 2006, the WTO report said.
Even in the case of new initiations of investigations, India reported with the maximum
number with 13, followed by New Zealand (6), South Korea (5) and Brazil, China and Japan
(4 each).
However, the total number of new initiations declined for all these countries. China is far
below India in terms of imposing final measures with five cases.
In the developed world, EU reported six such cases and the US three. "Products exported
from China remained the most frequent subject of new measures accounting for 22 of the 57
new measures reported for the first half of 2007 compared with 15 new measures on products
from China during the corresponding period of 2006," the report said.
Anti-dumping measures are resorted to by a nation when it finds that an country is dumping
its goods at a price that is much less than a fair price and could be injurious to the domestic
industry.
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India, Indonesia, Korea, and Thailand each were subjected to three new measures during the
first half of 2007.
Sector-wise, products in the chemicals sector are the most frequent subject of fresh measures
accounting for 12 of the 57. Products in the textiles sector are in second place, with 11 new
measures. The base metals sector was in third place, with nine new measures .Of the 12 new
measures on products in the chemicals sector, India applied eight, China three and the US
one. Reflecting a drop in the anti-dumping measures, 13 WTO members reported initiating
49 new investigations, compared with 92 initiations in the corresponding period of 2006.
A total of 16 members applied 57 new final anti-dumping measures during the first half of
current calendar yeast compared to 71 new measures reported by 15 members a year ago
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Case Study, Questionnaires and Answers
Through this project, the researcher plans to bring to light the two sides of dumping and
answer the following question:
1. Chapter I: An economic analysis on dumping: Why do firms dump products? What are the
benefits of dumping?
2. Chapter II: A legal perspective on anti-dumping: Why are Anti-dumping laws enacted and
what is the reasoning behind the legislations of the WTO/GATT to curb predatory pricing
and dumping?
3. Chapter III: The concluding chapter shall deal with the EC Bed Linen Case: A case of anti-
dumping filed by the EU against India. Here, all the legal loopholes and economic issues that
this landmark case has raised in the Anti-dumping agreement under GATT and how does it
affect the Indian producers shall be questioned and answered.
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Chapter I
An economic analysis on dumping: Why do firms dump products? What are the benefits of
dumping?
Answer: -
The rhetoric of anti-dumping is that it disciplines unfair trade practices. The
agreement specifies that price discrimination is an unfair trade practice if it causes injury
to domestic industry. However, economists argue that without showing predatory intent,
price discrimination cannot be held to be an unfair trade practice. Since there is no such
pre-requisite of anti-dumping use, it itself is an unfair trade practice that blocks fair
competition.
Benefits of dumping on the exporting country:-
1. It finds market for its surplus production
2. By exporting more, it is able to strengthen its balance of payments position
3. Consumers in the importing country benefit as they have to pay lower prices for
whatever they purchase of the commodity dumped.
4. Dumping benefits the consumers in the importing country who can buy the products at
cheaper rates. The losers are the consumers in the exporting country.
5. Dumping may also be caused by what is known as transitional dumping. It occurs
when an exporter needs to price below marginal cost in order to maximize sales and
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expand market share. In this case below cost-pricing is a kind of investment in the
marketing of the product to reap profits in the long run. Because this may require fixing
price below marginal cost, it may be treated as predatory pricing. Yet, clearly it is not.
6. Originally designed as a weapon against predatory and powerful companies, the role
of anti-dumping measures has changed from ensuring fair competition to protecting
inefficient competitors. They are being increasingly used against efficient producers;
especially from developing countries.
7. Confronted with such situations developing countries like China are formulating their
own anti-dumping legislations.
The bias in the definition of dumping favors the party imposing anti-dumping duties.
Dumping is considered to exist if the export price of a product is less than the comparable
price of the product or like-product in the domestic market in the ordinary course of trade.
However, when the average export and product prices of a product are calculated,
domestic sales prices below total cost are considered beyond the ordinary course of trade
and therefore excluded, while all export prices are included, thus artificially raising the
level of domestic price. This is a discrepancy in the calculation of dumping, and thus even
in cases where there is no dumping, according to the strict definition of dumping as per
the GATT Anti-dumping agreement, it will be considered as dumping and anti-dumping
measures will be unfairly levied on the producer; whilst in true cases of dumping, a
producer might be exempted from the anti-dumping measures. Thus this arbitrariness in
the calculation of dumping makes anti-dumping an unfair mechanism that randomly
levies duties on innocent producers or exempts the real dumping producers, due to non-
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uniformity in the application of the anti-dumping rule.
Also, if no home market price can be found, the sales price in a third country
surrogate country can be used for comparisons. Since different countries have varying
levels of economic development and comparative advantages in different sectors, the
arbitrary choice of a third country may easily lead to the definition of dumping.
Furthermore, when neither home country nor a third country price is available, a
constructed value is used which is the sum of material and labor costs of production plus
administrative, selling and general costs plus profit. As items such as administrative costs
and profits vary greatly among countries and companies, it is not difficult to see the
inherent subjectivity of the approach.
Sometimes, selling below total cost is a normal business practice, and not necessarily
dumping. According to the theory of micro-economics, so long as the price is above
average variable cost of production, a firm has incentives to continue production in the
short run, in order to minimize losses on fixed investment, in the hope that the market
situation will improve later to bring it back to profit. The duration of these short periods
may vary from firm to firm.
When a product enters a foreign market the exporting firm may have to sell below
total cost of production to attract consumers or to meet the existing competition without
any intention to dominate the market, especially if the product does not enjoy the same
established reputation as similar products in the market. It is unreasonable to subject such
business practices which are normal within many countries to anti-dumping charges when
foreign companies are involved.
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According to the Uruguay Round of anti-dumping code, an importing country can only
apply for anti-dumping duties when it is demonstrated that the dumped imports have
indeed caused injury to domestic industries.
Yet too often in reality either due to the complexities of the issues involved or to
protectionist considerations, anti-dumping authorities determine dumping without
carefully considering whether the difficulties of domestic producers resulted from their
own efficiency or inefficiency or from the allegedly dumped products. The consequent
imposition of anti-dumping duties tends to penalize the most efficient foreign producers.
The problems associated with anti-dumping rules are also related to the rules of origin.
In a world with increasingly globalizing tendencies and production, a product may be the
result of production in many countries. As there is no substantive multilaterally agreed
rules of origin, the same product can be considered to have different origins by different
countries. Therefore even if dumping has been correctly determined it may be difficult to
find who the party at fault is.
The application or abuse of lax anti-dumping rules penalizes foreign producers who
enjoy comparative advantages, to the benefit of inefficient domestic producers. It also
increases uncertainty in international trade, thus acting as a deterrent against potential
foreign competitors.
But foreign producers are not the only victims. The importers and industrial users of
the product in the country imposing the anti-dumping duties may become less competitive
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due to higher prices caused by such measures. Consumers have to pay more for similar
products. As anti-dumping rules vary for different countries, their complaints may not be
adequately represented. Even if some anti-dumping legislation requires consideration of
the views of these groups, the theory of political economy tells us that it is unlikely for
these diverse groups to be as vociferous as the concentrated producers of an industry in
lobbying activities.
The abuse of anti-dumping rules hits the developing countries harder whose exports
are increasingly subject to such measures in recent years. Due to their less diversified
economies, the developing countries enjoy comparative advantage in only a few sectors.
If the export of their competitive products is obstructed by anti-dumping measures, their
foreign exchange earnings and even economic development may be negatively affected.
Furthermore, as they lack financial resources and experienced personnel on anti-
dumping law, the expenses that their exports have to pay for dealing with anti-dumping
cases increases. For developing or transitional economies undertaking economic reforms,
anti-dumping duties on exports already priced by market forces only serve to hinder their
painful process towards a full market economy and to create cynicism about the western
preaching of free trade.
If an importing country finds that a trade partner subsidizes its exports, it can invoke
multilaterally agreed countervailing measures designed for this purpose. If due to some
unforeseen developments an industry of an importing country is seriously injured with a
flood of imports, the country can take measures to protect domestic producers in
accordance with WTO agreement on safeguards. Anti-dumping measures are not an
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effective cure for difficult market access in another country either, because they do not
tackle the problem at its source.
A number of economists argue for scrapping the anti-dumping agreement altogether.
They maintain that unless the anti-dumping laws seek to check predatory pricing the
application of the laws is welfare reducing. By seeking to protect domestic producers who
cannot face foreign competition the consumers are put to a loss. They argue that domestic
consumers benefit from low prices and if the import market is perfectly competitive, the
benefits to consumers outweigh the losses to domestic producers.
The current anti-dumping agreement imposes no substantive obligations on the
authorities to take the broader public interest into account. Many countries have
recommended that investigating authorities must consider public interest before imposing
anti-dumping duties.
It is not fair that the consumers be asked to pay the price for no commitment on the part
of the domestic producers even in the future to be able to take care of their interests.
However, it must be noted that public interest is not consumer interest alone. It is a
much wider term which covers in its ambit the general social welfare taking into account
the larger interest of various stake holders.
Sporadic dumping is when the producer intends to dispose of the casual overstock of
the producers. Sales in the specified period may not be as good as expected and the
producer finds himself with surplus stock. He finds it difficult to either dispose it off in
the domestic market or to hold it for the next season for various reasons. He therefore
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tries to sell it in the foreign markets at lower prices to recover some cost, which results in
dumping. Sporadic dumping may be unintentional. It could be due to currency
fluctuations or due to inexperience of the exporters.
Also, in sporadic dumping there is an occasional sale of a commodity at lower costs
abroad to unload an unforeseen and temporary surplus of the commodity without having
to reduce domestic prices, and persistent dumping which may prove to be benefit to a
nation since if the producer faces different marginal cost and marginal revenue lines in
each market, then it pays to charge different prices in each market. Thus, even though the
foreign markets will not be monopolized, the anti-dumping duties will cause severe losses
of producer surplus.
Also, in countries like USA, according to their Robinson-Patman Act, selling of goods
at unreasonably low prices to drive out competition is prohibited and anti-dumping duties
are slapped on firms even if the impact on these competing firms is negligent and
temporary. Thus, even though antitrust laws are meant to protect competition, anti-
dumping laws are wrongly used for the same purpose because of the simple reason that
any firm would be better off without competition.
An important reason why anti-dumping laws are abused is to obtain protectionist
outcomes is the definition often used to label acts as acts of dumping. According to this
definition, a firm is dumping if it sells its products abroad below fair market value i.e. the
average price of the product in its home market. Thus, even if it charges a competitive
price for its products in the foreign country, just because they may be lower than their
home market prices because of several price determining factors such as markets,
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demand, tariffs, advertising and selling costs, domestic taxes, skewed market functioning
and corruption amongst producers leading to artificial deviances in prices or the company
simply having lower cost of production than its foreign counterparts, a company is
allegedly dumping. The principal argument against this practice is that if price
discrimination is accepted as a valid measure domestically, how can it be called dumping
merely because it is done internationally?
Also, the definition of dumping doesn’t consider the fact that normal values of goods
may differ from time to time. Thus, one cannot just compare the face value of the prices
of the good in the two countries to determine the dumping margin and impose a similar
anti-dumping duty on the imports. Additionally, because it is often difficult to prove that
foreign firms charge higher prices to domestic than export customers, many a times a
supposedly fair price based on estimates of foreign production costs is used to calculate
the dumping margins. This a fair price can interfere with perfectly legal business practices
such firms willingly incurring losses to sell its goods and simultaneously reducing its
costs through experience or making an entry into a new market. The WTO rules do not
define market economy conditions. Thus, each member has broad discretion in setting the
conditions in antidumping allegations and taking advantage of these loopholes to demand
protection.
Since, anti-dumping duties are discriminatory, it implies that the domestic industry can
use this instrument to their benefit and target only those foreign firms it views as market
rivals. Also, in case of multinational firms, the definitions of domestic and foreign firms
are often blurred. Since they produce diverse products, one company may be treated as a
domestic firm that seeks protection from dumping, while for another product it may be
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treated as a foreign firm.
The WTO does mandate that the above factors be taken into consideration when
determining whether or not dumping is occurring. However, many developing nations
and some industrialized nations believe that the most nations do not carry out this
obligation in order to gain or keep the political favor of specific groups of voters.
There is still much confusion as to whether countries are actually using WTO
standards or not in their dumping investigations. There are many theoretical problems
with some anti-dumping procedures. Allegations of unfair investigations abound. The
WTO's Antidumping Agreement was made very complex to help to deal with these
problems. However, it has become too opaque to be able to correctly determine the
validity of some anti-dumping measures; thus arbitrarily imposing anti-dumping charges
on efficient and innocent producers, posing to be a serious threat to the international
market and jeopardizing the concept of free trade.
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Chapter II
A legal perspective on anti-dumping: Why are Anti-dumping laws enacted and what is
the reasoning behind the legislations of the WTO/GATT to curb predatory pricing and
dumping?
Answer:-
Political reality suggests that any government that attempts to establish or maintain
an open import regime must have at hand some sort of pressure valve - some process to
manage occasional pressures for exceptional or sector-specific protection. Since the
1980s anti-dumping has served this function. An anti-dumping petition is the usual way in
which an industry, plagued with troublesome imports, will request an anti-dumping
investigation. It is the way in which the government then provides protection.
Anti dumping is a measure to rectify the situation arising out of the dumping of goods and
its trade distortive effect. Thus, the purpose of anti dumping duty is to rectify the trade
distortive effect of dumping and re-establish fair trade. The use of anti dumping measure
as an instrument of fair competition is permitted by the WTO. In fact, anti dumping is an
instrument for ensuring fair trade and is not a measure of protection for the domestic
industry. It provides relief to the domestic industry against the injury caused by dumping.
Adam Smith noted that by restraining, either by high duties, or by absolute prohibitions,
the importation of such goods from foreign countries as can be produced at home, the
monopoly of the home market is more or less secured to the domestic industry employed
in producing them. It can be inferred from his writings generally that he was of the view
that by imposing duties, imports that harm domestic industries should be discouraged.
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Anti-Dumping is a reactionary measure to the dumping of goods into a foreign market.
When a country feels that another country is dumping goods into its economy it may
institute anti-dumping measures to protect the interests of the domestic producers of that
good. The exponents of anti-dumping justify it on the ground that it is a defense
mechanism in the hands of the importing country to safeguard their domestic producers.
The primary justification for anti-dumping measures is the perceived threat of predatory
dumping. In an imperfectly competitive and segmented market i.e. where the prices of
goods are controlled by firms and not by the market forces, and consumers have
minimum access to goods meant for export purposes, respectively, dumping can prove to
be profit-maximizing strategy for a monopolist firm. Firms may indulge in predatory
dumping, wherein the prices of their goods in the foreign markets are reduced
temporarily. The lower price imports could decrease the amount of domestic products
purchased, and domestic companies may not be able to lower their prices in order to
compete with these imports, driving these local firms out of business. These foreign firms
then command the prices, taking advantage of their newly acquired monopolistic status
and cause material injury in the form of economic retardations of the locally established
industries.
The cumulative effect of these injuries, it is contended, will finally lead to job losses,
slowdown of economic growth and spread of non-competitiveness.
In such cases it is argued that anti-dumping measures are justified as they protect
domestic industries from unfair competition from abroad, help in restoring the domestic
economies and may thus prove to be prudent measures. By imposing anti-dumping duties,
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dumped imports are discouraged and domestic firms maximize their own production and
profits.
It must be recorded however, that predatory dumping is a rarity because it assumes capital
market imperfection and an irregularity in financial resources that favor foreign
producers. It also assumes an impossible coordination between firms to precisely
calculate when and how much to dump to drive domestic industries out of business.
Additionally, since it is difficult to determine whether dumping is predatory or not,
domestic producers demand protection against any form of dumping even if it actually
not harmful.
From a petitioner point of view, anti-dumping stand out since it is a good instrument to
obtain protection because imposing other restrictions like import tariffs or voluntary
export restraints are inconsistent with the norms of the WTO and most governments are
not open to help domestic producers with protection. Also, anti-dumping producers can
disguise their fear of being destroyed by gigantic foreign rivals by asking for protection
and accusing these foreign competitors of unfair trade practice.
The main argument advanced for taking an anti-dumping measure against foreign
producers is that such a step ensures that national producers get better experience than the
foreign firms. It is frequently argued that such industries bring special advantages to a
country, either because they enable domestic factors of production to earn higher returns
than in other sectors of the economy or because they generate externalities or spill over
benefits for the rest of the economy. Anti-dumping policy is the best instrument for
achieving these objectives.
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According to them, anti-dumping is an instrument that is necessary as it acts as a safety
valve that ensures domestic political support to trade liberalizing initiative. Anti-dumping
in their view is the price paid for the maintenance of an open trading system among
nations. Anti-dumping is a trade remedy for domestic producers injured by cheap imports.
It is a tool that discourages predatory dumping. Anti-dumping is a GATT/WTO legal tool
that is used to grant protection to the import competing domestic industry, which is
adversely affected by free trade.
Government imposed trade barriers and government-tolerated anti-competitive practices
permit domestic producers to create monopolies in their home market. This enables them
to charge a low price in export markets and compensate the loss by charging higher
process in the domestic market without attracting foreign entry.
Producers in the importing countries fail to expand capacity, to improve productivity and
to use all resources efficiently. The distorted price signals in the market thus stimulate
overproduction of the exportable goods and underproduction of importable goods. This in
turn leads to a chronic oversupply by inefficient producers on one hand and the closure of
otherwise competitive facilities on the other, reducing worldwide efficiency. Anti-
dumping duties restore relative pricing to prevailing world market conditions and hence
efficient resource allocation.
The main reason why international price discrimination is usually considered unfair is
that a dominant firm, exporting its surplus over domestic profit-maximizing sales at lower
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prices, can benefit from economies of scale in production which its competitors abroad
are not able to achieve. Such a system could be sustained as long as its home market
remains protected. However, such conduct enhances competition in the export market as
long as the firm sets export prices at or above cost. Selling abroad at a loss could only be
rational for predatory purposes.
Chapter III
The concluding chapter shall deal with the EC Bed Linen Case: A case of anti-
dumping filed by the EU against India. Here, all the legal loopholes and economic
issues that this landmark case has risen in the Anti-dumping agreement under GATT
and how do it affect the Indian producers?
Answer:-
EC BED LINEN CASE
Possibly the most egregious distortion of dumping, is the practice known as "zeroing."
Zeroing is a concept whereby non-dumped sales are not permitted to offset dumped
sales, essentially by setting the value of a negative dumping margin to zero. This is
not something dealt with in article VI of the WTO Anti-Dumping Agreement.
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It is a significant cause of the systemic overestimation of dumping margins and
subsequent application of inflated anti-dumping duties. Certainly, the impact of
zeroing varies from case to case. If every comparison generates a positive dumping
margin, then the prohibition of zeroing will have no impact. But if there are many
comparisons generating negative margins, or if there are only a few generating large
negative margins, the prohibition of zeroing can have a very substantial impact on the
amount of anti-dumping duties ultimately applied.
The EU50 and the US argue that zeroing should be authorized by the WTO. Zeroing
of course makes dumping easier to find. But that is an unsatisfactory rationale. The
European commission explains that zeroing is needed to combat targeted dumping. A �
dumper, it says, may conceal dumping by selling at high prices at other times or
places.
However, even if targeted dumping is accepted as a plausible possibility, moreover,
the ADA51 allows national authorities to follow unusual trade practices if export
prices differ significantly among different purchasers, regions or time periods. �
But, to justify zeroing under that provision of the ADA(Article 2.4.2), the authorities
need to explain that zeroing is necessary and helps in tackling issues of targeted
dumping.
The practice of zeroing had the effect, in almost every case, of increasing the dumping
margin. In many cases, the practice of zeroing also resulted in a dumping margin of
more than the threshold of 2 per cent required to maintain an anti-dumping
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proceeding. In fact, in many cases, zeroing generated a margin of dumping where
there would otherwise not have been any.
The WTO Appellate Body has now conclusively determined in multiple cases that
zeroing is contrary to member countries commitments under the WTO Anti- Dumping
Agreement (ADA). Article 2.4.2 of the ADA requires that an investigating authority
take into account all comparable export transactions in the calculation of dumping
margins.
The WTO Appellate Body held that, by converting negative dumping margins to zero,
an investigating authority is not taking into account all export transactions. The
Appellate Body thus said that it was impermissible to ignore the effects of negative
dumping, i.e., those sales made at un-dumped prices.
Hence, the current stand of the WTO is that zeroing is not a practice in accordance
with the provisions of the Anti-dumping agreement, and thus should be not be
followed. It is a measure that is fundamentally flawed in many respects and tends to
give an unfair disadvantage to innocent producers.
The EC Bed Linen Case:
In September 1996 the European Communities (EC) initiated an anti-dumping case
against imports from India of cotton-type bed linen. However, the European Union
was split about the case. The reason for support for the action was clear protecting the
EU’s fabric weaving sector from low-priced import competition. Equally obvious was
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the reason for opposing the anti-dumping action: jobless companies that consumed the
imports which incurred or faced redundancies as a result of the protective remedy.
Because there were so many Indian exporters and producers of the subject
merchandise, cotton-type bed linen, the EC elected to analyze dumping from a sample
of Indian companies. In determining the home (Indian) market price for bed linen sold
by investigated respondents, the EC took the constructed value as a substitute for
Normal Value. The reason for using constructed value as a proxy for normal value
was a lack of sales made in the ordinary course in the Indian market (the market was
not viable). The EC identified five types of cotton bed linen exported to it and also
sold in representative quantities in India. However, not all five types were sold in
India in the ordinary course of trade. Thus, the EC could not base normal value on
prices from these sales, and had to use the constructed value.
The EC established export price from prices actually paid or payable for cotton-type
bed linen in the EC market and compared constructed value with export price,
computed for each Indian respondent with the dumping margin being the difference
between the weighted average constructed prices. In this computation EC applied a
zeroing methodology. It deemed any negative dumping margin as zero.
The EC calculated dumping margins for different models (for example- pillowcases
and sheets) finding negative dumping margins on a number of them. It then zeroed
these to obtain a dumping margin for bed linen.
The panel ruled that the calculation did not take into account of all transactions, as
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WTO rules require it to. The WTO appellant body said that a comparison between
export price and normal value does not fully take into account the prices of all
comparable export transactions such as the practice of zeroing is not a fair comparison
between export price and normal value (the price in the exporters home market)
The Appellate Body of the World Trade Organization has faulted the methods
adopted by the European Union in anti-dumping investigations and calculations of
dumping and found them to be violative of the WTO’s Anti-Dumping (AD)
agreement, and ruled in favor of India, in the EC’s actions against imports of cotton-
type bed linen from India.
In its ruling, the Appellate Body found fault with the EU Commission, AD
investigations and measures such as:
1. The practice of zeroing; i.e. investigating the existence of margins of dumping -
taking account of the averaging of positive dumping margins in investigated products,
but ignoring the cases where there are negative margins and giving a zero value to
them instead;
2. Calculating the administrative, selling and general (SG&A) costs and profits by
using a method where data applicable to one other exporter or producer is used to
apply to all others, and
3. Calculating the amount of profits by excluding sales by other exporters or
producers not made in the ordinary course of trade; and
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4. Using all types of bed-linen products - bed sheets, duvet covers and pillow cases,
packaged for sale either separately or in sets, and made of cotton-type fibers, pure or
mixed with man-made fibers or flax, and bleached, dyed or printed - as a single
product competing with like products of the domestic industry, for certain purposes of
investigation, but using the various components of the imported product for
calculating export price and normal value and averaging them, to establish dumping.
As a final observation about the bed linen cases, the appellate body exposed
the hypocrisy of the EC’s argument that bed linens were a single product, but
different dumping margins had to be calculated and zeroing had to be used, for
different product types.
Despite the considerable leeway provided to the importing countries to invoke the
Anti-dumping agreement’s instruments to protect their domestic industry - the WTO
dispute settlement panels issuing the rulings shows, the extent of the abuse of the
powers and trade harassment by the major industrialized countries, and the long time-
period before any relief can be obtained by the exporters in such cases.
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Examples of Dumping and Anti-Dumping
Dumping
EXAMPLE-I
Dumping occurs when a surplus of a product exists in one country, allowing exporters
to be able to sell that product at a deep discount in other countries, often far below
what a local farmer must sell his crop for in order to make a profit. Thus, while a
farmer in Chiapas, Mexico may be able to grow corn for, say, $3 a bushel, a U.S.
company can export it to Mexico and sell it for $2.20 a bushel (25% below the cost to
produce it), allowing the corn to sell on Mexican markets cheaper than domestic corn.
Corn is Mexico’s de facto national crop, yet in post-NAFTA Mexico over 25% of
the country’s corn market is now imported from America: an eighteen fold increase
since the implementation of NAFTA.
Under NAFTA, a yearly cap was placed on the amount of allowable amount of
corn that the U.S. could export to Mexico. The amount was supposed to increase
yearly until by the year 2008 when all limitations are removed. This was intended to
facilitate the price of corn in Mexico, which had been above world average, to fall
slowly until it was more in line with the price of corn in America and Europe.
Unfortunately for the Mexican farmer, this did not occur. Instead of a gradual
decrease in the price of corn over fifteen years, the market price collapsed at an
astonishing rate until, by 1997, it was equivalent to the world market average—having
decreased over 70 percent. In a little over two years, the bottom fell out from beneath
the feet of Mexican corn farmers.
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This results in the Mexican farmer, whose field is likely less than five acres in size,
not being able to sell his crop for a profit. In turn, this will lead to forced sale of his
farm. These former farmers often attempt to cross into the US in hopes of finding a
way to earn money. Ironically, they often end up working for the very farm
corporations that put them out of business.
Thus from the above example of Dumping we can see how it can affect a country’s
economy and their residents and the Domestic Market.
EXAMPLE – II Salmon: USA & EU/Chile:
Chilean sales of salmon (Salmon is the common name for several species of fish in
the family Salmonidae) to the USA are huge–US $2 billion in 2002, and a major
contributor to Chile’s economy. Chile is now the second largest salmon and trout
farmer in the world, after Norway. The USA is Chile’s most important market, and so
trade relations with the USA are critical. The first anti-dumping challenge occurred in
mid 1997, when US salmon producers claimed that Chilean government subsidies
were allowing producers there to sell below true production cost. This was rejected
by the ITC after the Chilean government was able to prove no such distorting
subsidies existed. However, fighting this allegation was very expensive though
estimated at $22 million, which was paid by Chilean farmers. Chilean companies had
to harmonize their accounting systems to accord with US government standards for
greater transparency. A further anti-dumping challenge followed, but this time was
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company-specific, setting tariffs at various levels around 5%. However by February
2003, a third US government review had concluded that 90% of Chilean producers
should not be subject to duties, and this challenge has now been officially terminated
completely.
In the EU, there has been a similar claim made against Chilean salmon. In July 2002
Irish and Scottish salmon farmers claimed that Chilean frozen salmon was being sold
in the EU at below production cost, so causing a fall in fresh salmon prices. This
claim had some difficulties since:
(i) Chile accounts for only 5% of EU supplies.
(ii) The fall in fresh salmon prices preceded a fall in those of frozen salmon by
6months
In February 2003 the Fisheries Commission of the European Parliament terminated
the investigation finding no grounds to proceed. Latterly, this issue has been
reopened, though, this time the emphasis is on a “safeguard” approach, the arguments
being that material damage to the Scottish and Irish salmon farmers has occurred, and
that this warrants action against third country imports.
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Anti-Dumping:
EXAMPLE - I
US beef imports to Mexico
While Mexico exports more live cattle to the U.S. than it imports, the U.S.
exports beef products back into Mexico in large numbers accounting for over 18% of
the U.S. beef market which amounted to over $450 million worth of beef products.
The Mexican government, in response to complaints from its farmers,
instituted anti-dumping tariffs on US beef products.
However, the four major U.S. beef packers are being charged anti-dumping tariffs
ranging from zero to 7.6% on bone in and boneless beef products exported to Mexico
while all the other U.S. packers must pay 75% on boneless beef and 13% on bone-in
beef.
In addition, beef offal is hit with a 215% anti-dumping tariff for all American
packers except the big four who pay anywhere from 3% to 26% duty on the same
products.
The measures still exist and American beef packers are still seeking a decision
by international trade courts.
Some countries institute de facto anti-dumping measures involving packing standards,
health standards, or manufacture standards that would prove extremely costly, if not
impossible, for some countries to maintain.
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These measures have the same result of monetary anti-dumping measures:
they usually result in the decrease of importation of those products into the domestic
market.
The countries being affected cannot fight such measures as these standards are
matters of internal domestic affairs, and the WTO has ruled that countries have to
right to enact such laws as ways to ensure the health of citizens.
EXAMPLE-II
Imports of Steel Pipes from India to USA
The US has imposed a preliminary anti-dumping duty on import of certain types
of steel pipes from India, about a month after New Delhi lodged a complaint
with WTO against the US for imposing anti-subsidy duties on import of certain Indian
steel products.
The US Department of Commerce said it has "preliminarily determined" that
Indian firms were selling the pipes -- circular welded carbon-quality steel pipe in the
US at 48.43 per cent below the fair market value of the product.
"Commerce preliminarily determined that producers/ exporters from India ... sold
certain steel pipe in the United States at dumping margins, or margin ranges, of 48.43
per cent," it said.
In the India investigation, the Department said, the mandatory respondent Zenith Birla
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(India) (previously known as Zenith Steel Pipes and Industries) received a preliminary
dumping margin of 48.43 per cent.
"There is an existing anti-dumping (AD) order on certain steel pipe from India.
Therefore, this investigation covers only merchandise manufactured and/or exported
by Zenith Birla...," it said.
The pipe is generally known as standard pipe, fence pipe and tube, sprinkler pipe, and
structural pipe.
In 2011, the US imports of pipes from India were estimated at USD 64.6 million. As
a result of the preliminary affirmative determinations, the Department "will instruct"
US Customs and Border Protection (CBP) to require a cash deposit or bond based on
these preliminary rates from importers. Last month, India had requested consultations
with Washington under the World Trade Organization (WTO) dispute settlement
system concerning the latter's countervailing duties on certain steel products from
India.
In March, the US had imposed preliminary countervailing duties of about 286 per cent
on certain steel pipe from India.
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CONCLUSION
The use of anti-dumping measures as a trade protection tool has increased phenomenally
during the last decade. One significant aspect of this new trend is the increasing involvement
of developing countries. India is one such country which has emerged as a frequent user of
anti-dumping measures.
Those in favor of anti-dumping duties argue that it is a tool of protection in the hands of
the domestic producers against the cheaper foreign imports. Critics of anti-dumping duties
though find it difficult to prove the fact that the imposition of anti-dumping duties results in
economic benefits to the domestic industry. Consumers are aggrieved as well, as they feel
deprived of the lower costs and availability of variety of goods. The role of the government in
tackling the problem of anti-dumping should be to protect the smaller industries rather than
concentrating on the major industries. This is because; it is these small scale industries which
suffer the most as a result of imposition of anti-dumping duties.
However, safeguarding competition in domestic industry is not the only purpose that anti-
dumping laws serve and in the present situation, they are acting as barriers for free trade and
domestic producers are concerned about avoiding competition.
In case of allegations and anti-dumping duties slapped on economically weaker nations, it
could result in a stunt of economic growth for these developing countries, as they are unable
to develop secure and stable long term industries. Even the threat of imposition of anti-
dumping duties has a serious adverse effect on the functioning of small and medium size
firms, resulting in a fall in production, heavy unemployment and declines in incomes and
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increases in poverty levels.
Anti-dumping duties were imposed by developed countries to protect their industries
against the low priced imports. Right from the beginning there was a clear division between
the fundamental aims of those countries whose exports were most commonly exposed to anti-
dumping action (developing countries) and those which took such action (mostly developed
countries). Developing countries wanted anti-dumping rules to be tight and explicit as
possible, allowing minimum transparency. Developed countries wanted to retain and even
expand their discretion to meet what they saw as being used by companies to get around the
present rules of anti-dumping code and thereby cause injury to domestic industry, their
proposals tended to be the most radical and controversial.
The wage rate differs from country to country, the economies differ and the demand
levels are also different. It is a settled economic fact that firms are guided by profit-
maximizing motives. The profits keep increasing till the time that marginal revenue is greater
than marginal cost. To allow marginal cost based pricing to adversely affect industry in other
countries cannot be justified on social welfare grounds. The capital dumped in the concerned
industry and the employment generated by that industry cannot be allowed to go non-
functional. This is not to say that the industry should be protected at all costs.
The negotiating stance of developing countries like India should be for tightening the
agreement. This is because India is a victim if the costs and benefits to different industry
segments are assessed at an aggregate level. Even though abolishment of these anti-dumping
laws will lead to increased competition, lower prices for consumers, more efficient
production, and higher national income, it is unrealistic to hope that the WTO will remove
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this trade device in the near future. But before things become worse, an immediate reform is
necessary and the WTO anti-dumping rules need to be amended to allow a more transparent
process of investigation and to determine correctly whether the material injury caused is
because of dumping or higher competition. The WTO rules need to be formulated so as to
target only predatory dumping and not persistent or sporadic dumping. All countries need to
have the uniform standards for determination of the dumping margins so as to maintain
fairness. While aiming at consumer welfare, it is necessary to justify the use of anti-dumping
laws as tools against unfair trade, to reconsider its definition and analyze as to what is
essentially fair and what is not and keeping in mind the gross abuse of anti-dumping laws
answer the very fundamental question of whether these laws are necessary at all.
As economics, anti-dumping action looks at only half of the economic impact on the
domestic economy. It gives standing to import competing domestic interests, but not to
domestic users, be they user enterprises or consumers. As politics, it undercuts rather than
supports a policy of openness; by giving voice to only the negative impact of trade on
domestic interests and by inviting such interests to blame their problems on the "unfairness"
of foreigners.
The key characteristic of a sensible safeguard procedure is that it treats domestic interests that
would be harmed by an import restriction, equally with those domestic interests that would
benefit. The "morality" of the foreign interest is irrelevant - the issue is the plus and minus on
the domestic economy. Operationally, this suggestion means simply that what is done in an
"injury test," - identification of impact on import competing interests - is repeated for users of
imports.
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Some argue that there must be more rigorous anti-dumping rules that must be formulated at
the domestic and international level. The notion of predatory pricing must be clearly
incorporated in the definition of dumping. The burden of proof of dumping must be placed
squarely on the party initiating dumping cases. The implementation of anti-dumping
measures should be subject to the close inspection of the WTO. Countries should more amply
inform their public of the costs and benefits of anti-dumping measures so as to promote an
unbiased and fair public opinion on this matter. These measures would ensure that anti-
dumping laws are fairly applied and assist only those producers who suffer as a result of the
low prices, and not arbitrarily affect the production of efficient producers who are not in
error.
Bibliography
BOOKS:
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See: Directorate General of Anti-Dumping & Allied Duties Ministry of Commerce,
Government of India.
INFOFISH: INFOFISH International 4/2003
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From Wikipedia/ Dumping (Pricing Policy)
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From: http://useconomy.about.com/od/glossary/g/Dumping.html
See: http://unctad.org/en/docs/edmmisc232add14_en.pdf
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wto/234827/ , Nov 01, 2007
See: http://www.nri.org/projects/fishtrade/issues-dumping.pdf
See: www.globalpolitician.com/23989-business
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dumping-duty-on-steel-pipe-imports-from-india/articleshow/13491165.cms
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screen=doc_detail&doc_id=8811&p=category%5E!Philosophy~!
&sort_by=downloads&start=0 ,
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Ikenson, Dan, Zeroing In: Antidumping's Flawed Methodology under Fire, sourced online
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48
Zhu Xiaohua, Anti-dumping measures: time to roll them back, Economic and Political
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http://www.wto.org/english/tratop_e/adp_e/adp_info_e.htm#introduction
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Anonymous, Dump Anti-dumping, sourced online
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A. Smith, The Wealth of Nations sourced from http://www.memoware.com/?
screen=doc_detail&doc_id=8811&p=category%5E!Philosophy~!
&sort_by=downloads&start=0 ,
M. S. Knoll Dump Our Anti-Dumping Laws sourced from
http://www.cato.org/pubs/fpbriefs/fpb-011.html
See Rai, Sheela, Anti-dumping measures under GATT and WTO, Eastern Book Company:
Lucknow,2004
Dan Ikenson, Zeroing In: Antidumping Flawed Methodology under Fire sourced online
from, European Union
Anti-dumping agreement
Brian Hindley, Edwin Vermulst, Zeroing in on Zeroing: Anti-dumping in WTO dispute
settlement.
See:http://www.ogilvyrenault.com/en/ResourceCenter/ResourceCenterDetails.aspx?
id=1011&pId=3
Bhala, Prof Raj, Modern GATT law a treatise on the general agreement of Tariffs and Trade,
PTO
50
S. Wittayarungruangsri, Antidumping: A Villain in International Trade, sourced from �
http://economics.about.com/cs/moffattentries/a/antidumping.htm ,
PTO
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