Market Economies and Concurrent Antidumping and Countervailing Duty Remedies

Trade authorities often use surrogates for normal value in antidumping proceedings, most famously in the case of nonmarket economies (NMEs). When an authority pursues simultaneous antidumping and countervailing duty investigations against a NME, the use of surrogate normal value creates the potential for a doubled remedy; this has been the subject of much litigation and analysis. But surrogates for normal value are also widely used in cases against market economies. There has been little recognition that this can also create an excessive remedy and has done so in important instances. Consequently, the current double-count issues will not end if NMEs graduate to the ranks of market economies under their Accession Protocols. Further, the recent Appellate Body (AB) attempt to redress the problem in NME cases and consequent US legislation have created a new divergence between the treatments of NMEs and market economies in combined antidumping and countervailing duty cases, which can lead to relatively worse outcomes for market economy respondents. The relevant WTO agreements permit solutions to this problem, but those solutions will have to abandon the method suggested by the AB for NMEs.