Anti-Dumping Duty
Also known as: AD Duty, ADD, Dumping Duty
Definition
Anti-dumping duties (AD duties) are extra tariffs imposed on imports when foreign manufacturers sell products in the US at prices lower than in their home market or below production cost. These duties “level the playing field” for domestic producers harmed by unfair pricing.
What Is Dumping?
Definition
Selling products in export market at:
- Less than “normal value” (home market price)
- Less than cost of production
- At prices that harm domestic industry
Dumping Example
Product: Steel Pipes
Home market price (China): $500/ton
Export price (to US): $350/ton
Dumping margin: 30%
Result: AD duty of ~30% imposed
How AD Duties Work
Process Overview
- US industry files petition
- Investigation by Commerce & ITC
- Preliminary determination
- Cash deposits begin
- Final determination
- AD Order issued
- Annual reviews determine actual rates
Investigating Agencies
| Agency | Role |
|---|---|
| Commerce (DOC) | Determines dumping margin |
| ITC | Determines industry injury |
Both must find affirmative for AD order.
AD Duty Rates
How Rates Are Set
- Company-specific rates (if cooperated)
- Country-wide rate (if didn’t cooperate)
- All-others rate (average)
Example AD Order
Country: China
Product: Wooden Bedroom Furniture
Company A: 7.24%
Company B: 16.37%
Company C: 198.08% (didn't cooperate)
All Others: 12.45%
Range of Duties
- Can be 0% to 300%+
- Varies widely by product/country
- Non-cooperative companies get highest rates
- Rates change with annual reviews
Active AD Orders
Common Products Under AD
- Steel products (many types)
- Solar panels
- Tires
- Furniture
- Seafood (shrimp, catfish)
- Paper products
- Chemicals
Major Countries Targeted
- China (most orders)
- India
- South Korea
- Vietnam
- Taiwan
- Japan
Importing AD Products
What Importers Must Do
- Check if product subject to AD order
- Determine applicable rate
- Pay cash deposit at entry
- File proper documentation
- Await final assessment
Cash Deposits
At time of import:
- Pay regular customs duty
- PLUS AD cash deposit
- Deposit rate from most recent review
- May be adjusted at liquidation
Annual Administrative Reviews
What Happens
- Commerce reviews actual prices
- Calculates new dumping margin
- Issues final assessment
- Adjusts for over/under deposits
Timeline
Review request: Anniversary month
Data submission: 6-12 months
Preliminary results: ~12 months
Final results: ~18 months from request
Liquidation: After final results
Results
| Scenario | Action |
|---|---|
| Final rate > deposit | Importer pays more |
| Final rate < deposit | Importer gets refund |
| Final rate = deposit | No adjustment |
Finding AD Information
Resources
- USITC AD/CVD Orders Database
- Commerce AD/CVD website
- Federal Register notices
- Customs broker consultation
Key Information Needed
- HS classification
- Country of origin
- Manufacturer/exporter
- Current AD rate
AD Duty Challenges
For Importers
- Significant cost increase
- Uncertainty until final rates
- Cash flow tied up in deposits
- Complex compliance
- Potential liability years later
Mitigation Strategies
- Source from non-AD countries
- Use companies with lower rates
- Challenge through scope rulings
- Participate in reviews
- Consider exclusion requests
AD vs. Regular Duties
| Aspect | Regular Duty | AD Duty |
|---|---|---|
| Purpose | Revenue, protection | Counter unfair pricing |
| Rate basis | HS classification | Dumping margin |
| Applies to | All countries | Specific country/product |
| Changes | Rarely | With each review |
| Payment | At entry, final | Deposit, adjusted later |
Scope Rulings
When Needed
- Product may or may not be covered
- Modified products
- Minor variations
- Unclear coverage
Process
- Request ruling from Commerce
- Provide product details
- Commerce determines if covered
- Binding on that product
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