Today, U.S. Secretary of Commerce Wilbur Ross announced the initiation of new antidumping duty (AD) and countervailing duty (CVD) investigations to determine whether rubber bands from China, Sri Lanka, and Thailand are being dumped in the United States or if producers in China, Sri Lanka, and Thailand are receiving unfair subsidies.
“The Department will act swiftly while ensuring a full and fair assessment of the facts,” said Secretary Ross. “The Trump administration is committed to the enforcement of America’s trade laws that ensure U.S. businesses and workers have a fair chance to compete.”
These AD and CVD investigations were initiated based on petitions filed by Alliance Rubber Company (AR) on January 30, 2018. The alleged dumping margins range from 27.27 percent for China, 56.54 percent to 133.13 percent for Sri Lanka, and 28.92 to 78.36 percent for Thailand. There are 16 subsidy programs alleged for China, 20 subsidy programs alleged for Sri Lanka, and 10 subsidy programs alleged for Thailand.
In the AD investigations, Commerce will determine whether imports of rubber bands from China, Sri Lanka, and Thailand are being dumped in the U.S. market at less than fair value.
In the CVD investigations, Commerce will determine whether Chinese, Sri Lankan, and Thai producers of rubber bands are receiving government subsidies.
If Commerce makes affirmative findings in these investigations, and if the U.S. International Trade Commission (ITC) determines that dumped and/or unfairly subsidized U.S. imports of rubber bands from China, Sri Lanka, and Thailand are causing injury to the U.S. industry, Commerce will impose duties on those imports in the amount of dumping and/or unfair subsidization found to exist.
Trade enforcement is a prime focus of the Trump Administration. From January 20, 2017, through February 21, 2018, Commerce has initiated 102 antidumping and countervailing duty investigations – a 96 percent increase from 52 investigations initiated during January 20, 2016, through February 21, 2017.
Commerce currently maintains 424 antidumping and countervailing duty orders which provide relief to American companies and industries impacted by unfair trade.
In 2017, imports of rubber bands from China, Sri Lanka, and Thailand were valued at an estimated $4.9 million, $2 million, and $12.1 million, respectively.
Click HERE for a fact sheet on these initiations.
During Commerce’s investigations into whether rubber bands from China, Sri Lanka, and Thailand are being dumped and/or unfairly subsidized, the ITC will conduct its own investigations into whether the U.S. industry and its workforce are being harmed by such imports. The ITC will make its preliminary determinations on or before March 16, 2018. If the ITC preliminarily determines that there is injury or threat of injury, then the Commerce investigations will continue, with the preliminary CVD determinations scheduled for April 26, 2018, and preliminary AD determinations scheduled for July 10, 2018, unless these deadlines are extended.
If Commerce preliminarily determines that dumping and/or unfair subsidization is occurring, then it will instruct U.S. Customs and Border Protection to start collecting cash deposits from all U.S. companies importing rubber bands from China, Sri Lanka, and Thailand.
Final determinations by Commerce in these cases are scheduled for July 10, 2018, for the CVD investigations, and September 24, 2018, for the AD investigations, but those dates may be extended. If Commerce finds that products are not being dumped or unfairly subsidized, or the ITC finds in its final determinations there is no harm to the U.S. industry, then the investigations will be terminated and no duties will be applied.
Foreign companies that price their products in the U.S. market below the cost of production or below prices in their home markets are subject to “antidumping” duties. Companies that receive unfair subsidies from their governments, such as grants, loans, equity infusions, tax breaks and production inputs, are subject to “countervailing duties” aimed at directly countering those subsidies.