Anti-dumping, countervailing and protective measures
Regulation in the frame of WTO
The WTO norms are targeted to the development of international trade through promotion of its liberalization. At the same time, in the frame of WTO three tools are provided – trade measures allowing protection of domestic producers' interests:
1) anti-dumping measures – measures taken for elimination of dumped import effects.
The anti-dumping measures application requires conducting anti-dumping investigations in the course of which it is necessary:
- to establish the fact of dumping, which means the sale of goods from one country to another at the price lower than its price in its internal market;
- to establish the fact of material damage (or its threat) to the domestic producers of similar goods (identical or the nearest equivalent in terms of its characteristics);
- to prove cause-and-effect relation between the dumped import and material damage (or its threat).
The anti-dumping measure is taken in the form of anti-dumping duty (calculated based on the cost of the good and charged over the import customs duty), or in the form of price liabilities of exporter who undertakes to sell the good at the price not lower than stipulated.
2) countervailing measures – measures taken for compensation of subsidies granted by exporting country.
According to the WTO law, countervailing measures shall be taken in cases where in the course of countervailing investigation it was established that:
- when producing the good to be imported, its producer obtained specific subsidy from the state;
- such subsidized import causes material damage (or its threat) to the domestic producers of equivalent good.
Countervailing measures can be exercised as countervailing duties charged above the import customs duty and price liabilities of exporter.
3) special protective measures – extraordinary measures oriented to temporary limitation of import for the purpose of protection of the domestic production interests.
Application of such measures require to prove in the course of investigation that import had a fast growth trend that can cause serious damage to the national production. Special protective measures shall be taken through imposition of special duty (charged above the import customs duty) or quota restricting actual volume of import. In this regard, binding condition for application of special protective measures is the application of measures in respect of the whole import notwithstanding the country of origin.
- Article VI GATT 1994;
- Agreement on the application of Article VI GATT 1994 (Anti-dumping measures agreement).
- Article VI GATT 1994;
- Agreement on the subsidies and countervailing measures.
Special protective measures:
- Article XIX GATT 1994;
- Agreement on the special protective measures regulates the norms of application of special protective measures.