Initiation of the investigation

08/12/2022 10:31 - 1 Views

An unfair trade investigation can begin in two different ways. The investigation usually begins when an 'interested party' (a domestic producer of the product in question, a labour union, or a trade association) files a petition with the Commerce Department and the Commission alleging that dumping or subsidization is taking place. The Commerce Department may also initiate an investigation by itself - without waiting for a formal petition - whenever it determines that an investigation is warranted. Such 'self-initiation' of anti-dumping investigations is quite rare, however, and happens only in very political cases, such as those involving lumber or semiconductors.

 

Initiation of the investigation is virtually automatic. The Commission begins its investigation almost immediately, and imposes virtually no requirements on the petitioner before beginning the investigation. Any problems are resolved during the pre-filing consultation with the agency that most petitioners undertake.

 

The Commerce Department follows a somewhat different practice. Within 20 days after a petition is filed, the Commerce Department must determine whether the petition meets the technical requirements for the initiation of an investigation. If not, the petition will be dismissed and the proceeding terminated. As a practical matter, however, the Commerce Department almost always initiates investigations. The Commerce Department encourages domestic companies to submit their proposed petitions for informal review prior to a formal filing. Because the Commerce Department advises the companies of any technical problems in the petition or areas where additional information is necessary, the petition is almost always acceptable when it is formally submitted to the Commerce Department and the Commission.

 

Foreign companies often wonder whether there is anything they can do to encourage or persuade the Commerce Department not to initiate an investigation, especially when the petition seems to have little basis in fact. Unfortunately, there is very little that can be done. Current United States law prohibits the Commerce Department from having any contact with potential targets of an anti-dumping investigation before the investigation is initiated. Although contact with other United States government agencies [such as the Office of the United States Trade Representative (USTR)] is legally permissible, it is virtually impossible to persuade those agencies to intercede in the early stages of an anti-dumping investigation. If a petition is filed, foreign companies therefore have little choice but to wait for the inevitable initiation of the investigation.

 

Once the petition is filed, a timetable set forth in the statute and required by law begins. Table 1 summarizes the important deadlines imposed by the statute in anti-dumping cases.

 

Table 1. Anti-dumping schedule

 

 

Phase

Deadline

Initiation

Petition +20 days

Preliminary Commission

Petition +45 days

Preliminary Commerce Department

Petition+160-210 days

Final Commerce Department

Petition+235-345 days

Final Commission

Petition +280-420 days

 

A similar, but shorter, set of deadlines apply in countervailing duty investigations, as shown in table 2.

 

Table 2. Countervailing duty schedule

 

Phase

Deadline

Initiation

Petition +20 days

Preliminary Commission

Petition +45 days

Preliminary Commerce Department

Petition+85-150 days

Final Commerce Department

Petition+160-225 days

Final Commission

Petition +205-270 days

 

Because of the various possibilities for extensions, it is best to think of the timetable as periods of time during which a particular decision can be made, rather than precise dates.

 

In addition, if the Commerce Department decides that it needs to conduct a special investigation to determine whether the domestic industry has 'standing' to bring to case, the agency can take more time. The United States law allows anextra 20 days before initiating the case to conduct this special review.

 

A special rule applies if the Commerce Department decides that it needs to investigate so-called upstream subsidies. In such cases, the agency is allowed an additional period of time — another 160 days — to make the preliminary determination.

 

These are the major deadlines required by the statute. As discussed below, there are a number of other deadlines, some formal and some informal, imposed by the Commerce Department during the course of the investigation.

 

Source: Business Guide to Trade Remedies in the United States: Anti-dumping, countervailing and safeguards legislation practices and procedures

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