Countervailing Duties

Overview
News
Articles

While the law is extremely complex and practice in the area is changing constantly, the summary below provides a quick reference to the main issues. Because we have one of the largest trade remedies’ practices in the United States, we would be glad to answer any specific questions that you may have on these issues. Call Jeff Neeley or Matt McGrath in the Washington, D.C. office at 202-483-0070 for further information.

1. How Cases Begin—Cases may be filed by a U.S. industry that can show that (a) imports are subsidized; and (b) the U.S. industry is being injured by these subsidized imports.

2. Deadlines—Cases have very strict and fast deadlines. The first hearing is three weeks after the filing of a petition. Final determinations are made within one year. Interim relief is generally granted within 160 days of the initial filing.

3. Agencies involved—Cases are heard at the U.S. Department of Commerce (regarding the level of subsidies) and the U.S. International Trade Commission (regarding whether injury exists).

4. Type of Relief—Relief is in the form of additional duties. U.S. producers that are faced with subsidized imports like these cases because a successful case will effectively offset such subsidies.

5. Risks to Importers—Importers operating under a subsidy order need to be very cautious because the subsidy rates may change and the scope of the order may be modified.

6. What Is A Subsidy?—Subsidies may be such things as export subsidies, special tax zones for exporters, government loans at below market rates, preferential tax benefits for exporters, preferential tax benefits for certain industries, equity infusions in non-equity worthy companies.

7. Retroactive Assessment—Importers deposit duties based on the last completed calculation of rates, but these are only estimates and not final rates. Once each year a review will be conducted for the prior year’s sales to determine what the subsidy margin is for entries during that year.

For example, a company might deposit 10% subsidy duties for January-December 2011. In January 2012, the DOC begins to review those 2011 sales (review proceeding takes about one year). When a review is completed the actual duties are determined, which can be greater or less than the 10%. Importer gets refund or pays additional duties.

8. ITC Injury Determination—Even if the Commerce Department finds subsidies, the CVD order will not go into effect unless the ITC also finds that the domestic industry is injured by reason of the subsidized imports.

The essential argument of importers and exporters at the ITC usually is that U.S. industry is not being harmed (or threatened), usually because of a lack of any causal connection between the imports and the condition of the U.S. industry. The substantive argument often is based on an alleged lack of linkage between subsidized imports and condition of the US industry, differences in product segments leading to no real competition, other causes of the problems of the industry. Procedural steps include filing a notice of appearance, completing questionnaires, participating in staff conferences, and filing briefs with legal/factual arguments.

9. The Administrative Review Process—This process only occurs at the Commerce Department. The retrospective assessment system in the U.S. means that the final liability for subsidies is determined only after the opportunity for a review. The usual time frame for a review is 16-17 months.

Importers may request reviews for their own imported goods. Either domestic parties or foreign manufacturer may request a review for a foreign company. If a company is to request a review itself, it should prepare in advance and know the risks of such a review, because the CVD paid as a result of the review could be lower, or higher, than the amounts deposited initially.

10. Scope Issues—Only “subject goods” are those that are described in the order.

Sometimes it is possible to “clarify” the order to have imports excluded from the case. If this is done, then the imports are simply not subject to the order.

DOC conducts scope reviews. Any interested party (including an importer) may request a clarification. There is a two tier review process, depending on the case: (1) DOC decides whether the good is clearly outside of scope on face of the order, and (2) if not, then Commerce conducts a further inquiry.

In further inquiry cases, Commerce often examines five factors to assist it in determining if a product is in or out of the scope of the order. The factors are:

Physical characteristics of the product
Expectation of ultimate consumers
Ultimate use of product
Channels of trade of product, and
Manner of advertising and display

Because BRC is experienced in both customs law and antidumping/CVD practice, it is in a strong position to help clients navigate the complex issues that arise in the scope context.

11. Other Issues—Other issues that arise in CVD cases, which we frequently address, include five year “sunset” reviews determining whether there still would be injury to the U.S. industry if the CVD order were lifted,

12. Circumvention Issues—Circumvention of CVD orders can have administrative effects under the CVD law, as well as penalties from U.S. Customs & Border Protection, and even criminal liability in certain instances. Circumvention issues regarding the CVD order (particularly with regard to Chinese goods) have become increasingly common in recent years. BRC’s expertise with regard to both CBP and the Commerce Department puts us in the position to work through all aspects of the problem for clients and attain a just result.

May 30, 2025: Tariffs Back on For a While Probably, Maybe
May 22, 2025: Skirting the Law: UFLPA Compliance and Subsidiaries
May 15, 2025: Another Customs "Clarification" Excludes Feeder Ships from In-Transit Vessel Exemption
May 13, 2025: White House Announces Trade Deal With China (UPDATE)
May 12, 2025: Commerce Initiates Section 232 Investigation on Aircraft, Engines, and Parts
May 12, 2025: White House Announces Trade Deal With China
May 12, 2025: Customs Clarifies "U.S. Content" for Reciprocal Duties
Ma 8, 2025: U.S. and U.K. Strike Trade Deal Following Trump Tariffs
May 7, 2025: CIT Issues Classification Neither Party Advocated
May 1, 2025: A Brief Survey of the IEEPA Legal Challenges
Apr. 30, 2025: CBP Clarifies: In-Transit Tariff Exemption Applies Only to Vessel Shipments
Apr. 29, 2025: Administration to Ease Auto and Parts Tariffs
Apr. 29, 2025: Latest Executive Order Limits Tariff Stacking
Apr. 24, 2025: De Minimis Ending for Goods of China (and Hong Kong)
Apr. 23, 2025: Section 232 Takes on Medium and Heavy-Duty Trucks
Apr. 17, 2025: Another Rapid Response Mechanism Request on the Books
Apr. 16, 2025: Trump Orders National Security Investigation for Critical Minerals
Apr. 10, 2025: EU to Pause Countermeasure Response for 90 Days
Apr. 9, 2025: EU and China Strike Back with Tariffs on U.S. Imports
Apr. 9, 2025: Trump Announces 90-Day Pause on Country-Specific Reciprocal Tariffs
Apr. 8, 2025: Customs Issues "Reciprocal Tariffs" Guidance
Apr. 8, 2025: White House Indicates China Will Face (at least) 104% Duties
Apr. 4, 2025: Tariff Subheading Guidance for ‘Reciprocal Tariffs' Published
Apr. 4, 2025: Global Response to U.S. ‘Reciprocal Tariffs'
Apr. 3, 2025: Correction and Exclusions for ‘Reciprocal Tariffs' Published
Apr. 2, 2025: Trump Announces 25% Tariff on Passenger Vehicles, Light Trucks, and Auto Parts
Apr. 2, 2025: Changes to De Minimis Duty Free Treatment for Good from China and Hong Kong
Apr. 2, 2025: Reciprocal Tariffs Announced
Mar. 27, 2025: President Trump Announces 25% on Autos and Light Trucks
Mar. 25, 2025: 25% Tariffs on Countries that Import Venezuela Oil
Mar. 19, 2025: AD/CVD Petitions Filed for Corrugated Boxes from China and Vietnam
Mar. 13, 2025: Countries Around the World Strike Back at the Trump Administrations Increase in Tariffs
Mar. 11, 2025: U.S. Seeking Broad Trade Agreement with India
Mar. 11, 2025: As Tariffs Loom, Steel and Aluminum Rules Remain in Flux with Lost Exclusions and Increased Duties
Mar. 11, 2025: CBP Guidance on Duties on Imports of Steel and Steel Derivative Products
Mar. 11, 2025: CBP Guidance on Duties on Imports of Aluminum and Aluminum Derivative Products
Mar. 11, 2025: Canadian 50% Steel & Aluminum Tariff Reportedly Averted
Mar. 11, 2025: Steel & Aluminum Derivatives Tariffs Outside Chapters 73 & 76 Effective This Week
Mar. 10, 2025: USTR Announces 2025 Trade Agenda
Mar. 6, 2025: Tariff Exemptions on Mexican USMCA Imports Reported
Mar. 6, 2025: All USMCA Imports Reportedly Exempt from Tariffs
Mar. 6, 2025: USMCA Tariff Exemption Executive Orders Published
Mar. 5, 2025: Senators Revise Plan to Tie Duties to Carbon Emissions
Mar. 5, 2025: Tariffs on Autos Under USMCA from Canada or Mexico Reportedly Suspended One Month
Feb. 4, 2025: Steel and Aluminum: The Gifts That Keep on Giving
Mar. 3, 2025: Timber, Lumber, and Derivatives Get Their Own National Security Investigation
Mar. 3, 2025: Canada and Mexico Duties Deadlines Arrive with No Indications of Delay

View Archive

Jan. 22, 2025: Webinar: What We Know After the Inauguration
Sep. 9, 2024: McPherson to Co-Moderate Export Enforcement Discussion
Jun. 2, 2023: BRC and Attorneys Ranked in 2023 Chambers Guide
May 4, 2017: BRC Partner Lawrence Friedman to Speak at Upcoming PERT Event
March 8, 2017: Barnes Partner Lawrence Friedman Quoted Regarding Tariff Engineering in Washington Post
January 30: David G. Forgue to Speak at Chicago Customs Broker and Freight Forwarder Association Seminar
June 6, 2014: Larry Friedman Elected Vice President of CITBA
November 05, 2013: Barnes/Richardson Secures Unanimous Dismissal by ITC
July 26, 2013: BRC Partner Quoted on Threaded Rod Antidumping Investigation
February 28, 2013: Barnes/Richardson Client Receives De Minimis Rate in Hardwood Plywood Preliminary Determination
May-June 2012: White House International Trade Initiatives
By: David G. Forgue
December 6, 2011: The Latest Lurking International Trade Liability
By: David G. Forgue
December 6, 2011: David Forgue on The Latest Lurking International Trade Liability
By: David G. Forgue
Aug. 10, 2011: Barnes/Richardson Publishes White Paper on ENFORCE Act
By: David G. Forgue
August 10, 2011: ENFORCE Act White Paper
By: David G. Forgue