US policy in anti-dumping investigations unfair to China

In recent years, in an effort to further assist the repatriation of the US manufacturing industry and consolidate its economic recovery, the US Department of Commerce has made major revisions to the rules for anti-dumping investigations of non-market economies, particularly China. These revisions have placed Chinese enterprises that face actions in a disadvantageous position.

Q: What has been the Department of Commerce’s separate-rate policy recently?

A: Previously, in investigation practice, if a Chinese state-owned enterprise (SOE, even if it was an enterprise in which the state had a controlling interest) satisfied the relevant conditions and submitted the relevant information and documents, it was generally eligible for a separate rate status without any major obstacles. However, the Department of Commerce now implements the relevant criteria more “stringently”. If a Chinese SOE cannot adequately show that it is lawfully and actually independent of the government, it will be ineligible for a separate rate and will instead be subject to the highest punitive anti-dumping rate.

The Chinese passenger vehicle tyre anti-dumping case that concluded in June 2015 is an example. The Chinese enterprises that were refused the 25.3% separate rate will be subject to an 87.99% China-wide rate. This illustrates from another perspective that it is difficult for enterprises controlled by the State-owned Assets Supervision and Administration Commission (SASAC) to be granted a separate rate. Those enterprises in which the state has an equity interest and those in which it does not have a relative controlling interest also have to prepare the relevant supporting documents more carefully and in greater detail, increasing the burden on them.