Bridges Weekly Trade News Digest • Volume 9 • Number 41 • 30th November 2005
US Shrimp Anti-Dumping Duties Under Attack On Several Fronts
On 15 November, Ecuador initiated WTO dispute proceedings against US anti-dumping duties on its shrimp exports. It alleges that the method known as "zeroing" used by the US Department of Commerce to calculate the duties contravenes WTO rules. Under the WTO Anti-dumping Agreement, a WTO Member can impose anti-dumping duties on an imported product if it finds that the company exporting the product charges less for it abroad than in the home market.
Dumping calculations require export prices to be compared to the normal home market levels. According to the US’ zeroing methodology for determining dumping margins for a certain product, instances where US sales prices are higher than the home market level are simply not taken into account, or "zeroed" out of the assessment. Thus, only instances where US prices are lower than the home market level are taken into account. Ecuador has argued that this process leads to artificial and inflated anti-dumping margins. The methodology has been consistently ruled against in previous disputes between the US and countries such as Canada, the EU, Japan, Mexico and Thailand.
The US has imposed anti-dumping duties on certain shrimp and prawn exports from Brazil, China, Ecuador, India, Thailand and Vietnam.
In a related development, the US recently received heavy criticism when its International Trade Commission (ITC), a federal agency, ruled to uphold those duties on imports from Thailand and India despite the fact that the industry there had been severely harmed by the December 2004 Indian Ocean tsunami (see BRIDGES Trade BioRes, 11 November 2005). When first imposing the anti-dumping duties in January 2005, the US expressed concerns over the effects of the tsunami in the region, and launched a review to determine whether they could be revoked without injuring the US shrimp industry. The ruling effectively concludes that they could not.
"Ecuador Initiates WTO Dispute Proceedings Against U.S. for AD Duties on Shrimp Imports", WTO REPORTER, 17 November 2005; "US dumps Indian shrimp with anti-dumping duty," FINANCIAL EXPRESS, 4 November 2005; "US panel votes to keep shrimp antidumping duty orders for India and Thailand," FISHUPDATE, 3 November 2005; "ITC Votes To Keep Shrimp Antidumping Duty Orders For India And Thailand In Place," ITC PRESS RELEASE, 2 November 2005; "Shrimp exporters may have to fish in markets other than US," FINANCIAL EXPRESS, 7 November 2005.