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Working Papers / Global Economics: Trade Investment and Development

2017

NMEs and the double remedy problem

Author(s): Thomas J. Prusa

Topic(s): Trade, Investment and International Cooperation //

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ABSTRACT

In 2007 the US reversed its long-standing policy prohibiting the simultaneous imposition of anti-dumping duties (ADDs) and countervailing duties (CVDs) against non-market economies. The EU followed the US’ lead and also began imposing simultaneous ADDs and CVDs. The practice, however, leads to double remedies, which are when a domestic subsidy is offset by both an ADD and CVD. The WTO Appellate Body recently ruled that double remedies were inconsistent with the Agreement on Subsidies and Countervailing Measures and that the burden was on the investigating authorities to ensure that double remedies were not being imposed.