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Article

Jaemin Lee and Youngjeen Cho

The purpose of this paper is to examine zeroing jurisprudence under the WTO’s Anti-Dumping Agreement and to see if the jurisprudence can still be applied to situations of…

Abstract

Purpose

The purpose of this paper is to examine zeroing jurisprudence under the WTO’s Anti-Dumping Agreement and to see if the jurisprudence can still be applied to situations of targeted dumping where dumping takes place in a specific region, at specific timing, or for specific consumer groups.

Design/methodology/approach

This paper examines the prior decisions of the WTO panels and the Appellate Body relating to the zeroing practice. It categorizes the key elements of these prior decisions where the zeroing practice has been found WTO-inconsistent. While there has been no specific dispute addressing targeted dumping per se, this paper proves that core elements of the zeroing practice have been anatomized and dissected by the panels and the Appellate Body in prior proceedings. The paper then analyzes whether these key elements still exist in the specific context of targeted dumping and thus whether application of zeroing is still prohibited in targeted dumping situations.

Findings

The existing jurisprudence on zeroing from previous WTO disputes should apply to targeted dumping situations as well. Unbridled application of zeroing in the targeted dumping situations will effectively nullify the existing zeroing jurisprudence accumulated through a decade of WTO disputes. If unchecked, this calculation methodology in the context of targeted dumping may open the back door wide open for “zeroing” negative anti-dumping margins. The paper concludes that the existing jurisprudence on zeroing stands for the proposition that zeroing in targeted dumping should also be prohibited.

Originality/value

This paper examines the legality of the zeroing practice in targeted dumping situations, which has been one of the most controversial issues among WTO members for the past several years. The analyses and discussions contained in this paper will provide legal guideline to evaluate zeroing in targeted dumping within the WTO framework. The outcome of the research will provide a platform for continued research and discussion in this area.

Details

Journal of Korea Trade, vol. 20 no. 3
Type: Research Article
ISSN: 1229-828X

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Article

Sang Man Kim and Jongho Kim

The purpose of this paper is to review the use of zeroing in the weighted average-to-transaction (W-T) comparison methodology and targeted dumping under the anti-dumping

Abstract

Purpose

The purpose of this paper is to review the use of zeroing in the weighted average-to-transaction (W-T) comparison methodology and targeted dumping under the anti-dumping agreement by reviewing the WTO appellate body’s rulings on the use of zeroing in the W-T comparison methodology in the USA – anti-dumping measures on large residential washers from Korea (DS464). Although the appellate body has ruled that the use of zeroing would not be allowed in the weighted-average-to-weighted-average comparison methodology nor in the transaction-to-transaction comparison methodology, it has not ruled on whether the use of zeroing is allowed in the W-T comparison methodology prior to the instant case.

Design/methodology/approach

This paper mainly analyzes the WTO appellate body report on the USA – anti-dumping and countervailing measures on large residential washers from Korea’s rulings (DS464) and reviews other WTO appellate body reports on the use of zeroing in anti-dumping measures. This paper reviews the relevant provisions of the WTO anti-dumping agreement and the US Anti-Dumping Act, and also referred prior papers on the use of zeroing.

Findings

The appellate body upheld the panel’s finding that the USA’s use of zeroing in the W-T comparison methodology is inconsistent with Article 2.4.2 of the anti-dumping agreement. As zeroing inflates dumping margins, increases the amount of duty collected, and hinders the expansion of trade in goods. The use of zeroing should be prohibited or permitted only in very limited circumstances.

Social implications

Zeroing, which has been the subject of many WTO disputes between the USA and foreign governments, causes dumped sales to be masked by fair value. The WTO appellate body has consistently condemned the US practice of zeroing over the past decade as an unfair commerce practice. The instant case and this paper will help to stop the practice of zeroing in anti-dumping measures.

Originality/value

The text of Article 2.4.2 does not clearly prohibit the use of zeroing. The paper reviews the WTO appellate body’s rulings on the use of zeroing in the W-T comparison methodology in the USA – anti-dumping measures on large residential washers from Korea (DS464). The appellate body report was very recently circulated, on September 9, 2016. The appellate body has not ruled on whether the use of zeroing is allowed in the W-T comparison methodology prior to the instant case. This paper, first, concludes that the W-T comparison methodology is inconsistent with Article 2.4.2 of the anti-dumping agreement.

Details

Journal of Korea Trade, vol. 21 no. 2
Type: Research Article
ISSN: 1229-828X

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Article

Robert W. McGee

Anti‐dumping laws have been around for decades. They have increased in importance in recent years and will become even more important in the future as a result of the…

Abstract

Anti‐dumping laws have been around for decades. They have increased in importance in recent years and will become even more important in the future as a result of the Uruguay Round and the creation of the World Trade Organization. Yet anti‐dumping laws are inherently protectionist because they protect domestic producers at the expense of consumers. They have a chilling effect on price competition and cause the prices on a wide range of products to be higher than would otherwise be the case. Examines the anti‐dumping laws in theory and practice, from both a utilitarian and human rights context, and concludes that these laws cannot be justified on any reasonable grounds. Calls for their repeal, the sooner the better.

Details

European Business Review, vol. 96 no. 5
Type: Research Article
ISSN: 0955-534X

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Article

Christopher E.S. Warburton

The purpose of this paper is to analyze the potential for tariff reduction under the most favored‐nation (MFN) provision of international trade law as it is written, lex lata.

Abstract

Purpose

The purpose of this paper is to analyze the potential for tariff reduction under the most favored‐nation (MFN) provision of international trade law as it is written, lex lata.

Design/methodology/approach

The paper analyzes differences in average tariff rates applied to imports under the MFN provision of international trade law. Two empirical methods are used; an analysis of variance to estimate significant differences in tariff rates between high‐income members and least‐developed members of the World Trade Organization (WTO); and fixed‐effects regression model to determine the effect of national output on the marginal propensity to import (MPM).

Findings

The paper finds that there is a significant difference in the margins of import tariffs that are applied to imports by the high income and the least‐developed members and that the MPM is significantly dependent on output for the high‐income members, but not for the least‐developed members.

Practical implications

The findings indicate that international trade law must be developed with the aim of increasing national earnings capacity and not just creating enabling conditions for tariff reduction or the harmonization of municipal law with international trade law. When circumstances change in a fundamental way (rebus sic stantibus), WTO members must be measured in their approach to attain the law that is sought (lex ferenda).

Originality/value

The paper argues that multilateral trade arrangements for tariff reduction and fair trade must integrate enabling conditions with arrangements for earnings capacity to increase national income and reduce tariffs.

Details

Journal of International Trade Law and Policy, vol. 9 no. 1
Type: Research Article
ISSN: 1477-0024

Keywords

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Article

Elijah Jacob Kosse, Stephen Devadoss and Jeff Luckstead

The purpose of this paper is to provide a historical background of the tomato dispute, review the USA trade law and its effect on the tomato trade, discuss the role of the…

Abstract

Purpose

The purpose of this paper is to provide a historical background of the tomato dispute, review the USA trade law and its effect on the tomato trade, discuss the role of the North American Free Trade Agreement and other supply and demand factors on increased tomato imports from Mexico and present a conceptual analysis of the effects of a Suspension Agreement (a form of Voluntary Export Restraint) on the USA and Mexico. In 1996, the USA and Mexico signed the Suspension Agreement which sets a guaranteed minimum price for Mexican tomato imports.

Design/methodology/approach

Conceptual analysis graphically illustrates how the Suspension Agreement affects the tomato trade for the USA and Mexico and shows the benefits and losses of consumers and producers in these two countries.

Findings

There is no consensus regarding whether Mexico dumps tomatoes onto the US market. However, US trade law favors domestic producers, leading to the signing of the Suspension Agreement. It is shown here that this agreement has substantial welfare effects in both Mexico and the USA. While it was designed to protect US producers, it also aids Mexican consumers and may potentially improve Mexican producer surplus as well. Only US consumers unambiguously suffer a loss.

Research limitations/implications

As the theoretical model indicates, the Suspension Agreement’s minimum price does help Floridian farmers but, if the rents are large enough, may also aid Mexican producers. If Mexican producers do gain, then quota rent is shifted from tomato consumers to Mexican producers. On the other hand, US consumers are hurt as well as tomato processing plants because they purchase fresh tomatoes for use as inputs. The higher price minimum after the 2013 agreement will likely intensify the welfare effects, and the addition of different categories with distinct prices is likely to have additional consequences for both welfare and trade distortions.

Originality/value

As the USA and Mexico recently signed a new Suspension Agreement, this paper deals with a very timely and contentious trade dispute and contributes to the area of research international trade war. The literature on Suspension Agreements is also expanded by providing welfare analysis of both producers and consumers.

Details

Journal of International Trade Law and Policy, vol. 13 no. 2
Type: Research Article
ISSN: 1477-0024

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Article

Mirek Tobiáš Hošman

Although officially ended in July 2020, China’s dispute about its non-market economy (NME) status at the World Trade Organization (WTO) is far from being resolved. The NME…

Abstract

Purpose

Although officially ended in July 2020, China’s dispute about its non-market economy (NME) status at the World Trade Organization (WTO) is far from being resolved. The NME status enables China’s counterparts to disregard Chinese prices in antidumping proceedings and instead use the so-called surrogate country methodology. This paper aims to structure and analyze the complex debate, which emerged with the disputes China has filed against the European Union and the USA at the WTO, and therefore provide a point of reference for future analysis of and debates about China’s NME status.

Design/methodology/approach

The analysis is based on the existing academic literature on the topic and on the legal WTO-related documents (e.g. multilateral agreements, China’s Accession Protocol, legal findings of the WTO dispute panels).

Findings

Four different interpretations of the respective legal documents about China’s NME status are discussed and strong and weak aspects of these interpretations are pointed out. Also, several misunderstandings and mistakes appearing in the debate are clarified.

Practical implications

As the question of China’s position at the WTO and its NME status has not been resolved yet and some authors believe that China will pursue its case again once the WTO Appellate Body revives its functionality, the analysis of the debate can serve as a point of reference for the academic debate and the future research on this topic. Moreover, it offers an introduction to China’s NME position at the WTO for the newcomers to this topic.

Originality/value

Although China’s NME status has been much discussed, there is no literature review that would structure the debate and point out some of the (dis)advantages of the respective arguments and interpretations. Rather than adding to the large corpus of literature about the NME status, this study takes this corpus as the object of its analysis.

Details

Journal of International Trade Law and Policy, vol. 20 no. 1
Type: Research Article
ISSN: 1477-0024

Keywords

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Article

Robert W. McGee and Walter Block

Explores the question of whether initiating an anti‐dumping action constitutes unethical conduct. Suggests that it is generally accepted that stealing and destroying the…

Abstract

Explores the question of whether initiating an anti‐dumping action constitutes unethical conduct. Suggests that it is generally accepted that stealing and destroying the property of others are wrong, and that hiring someone to do the stealing or destruction for you is also wrong. Concludes that initiating an anti‐dumping action constitutes unethical conduct, since anti‐dumping actions involve theft and the destruction of property, not to mention the violation of contract and property rights and the freedom of association.

Details

International Journal of Social Economics, vol. 24 no. 6
Type: Research Article
ISSN: 0306-8293

Keywords

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Expert briefing

Prospects for the EU dropping China from its NME list.

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Book part

Andrew G. Brown and Robert M. Stern

We first discuss what fairness may mean in the context of the dispute settlement process, noting the crucial relation between fairness in dispute settlement and the…

Abstract

We first discuss what fairness may mean in the context of the dispute settlement process, noting the crucial relation between fairness in dispute settlement and the functioning of the trading system as a whole. We explore this relation further through an analysis of three main groups of dispute settlement cases. These are cases that turn around the question of defining fair competition; cases that arise from the use of contingency measures; and cases that draw the boundaries between domestic regulatory measures and the trade-related norms and rules of the WTO. There follows an analysis of experience with compliance and with the use of countermeasures in various cases. Finally, taking together the rulings of the Dispute Settlement Body and the procedures for compliance and the use of countermeasures, we conclude that while the present dispute settlement process serves to protect the fairness of the trading system as a whole, there are some aspects of dispute settlement that remain problematic from the standpoint of fairness.

Details

Trade Disputes and the Dispute Settlement Understanding of the WTO: An Interdisciplinary Assessment
Type: Book
ISBN: 978-1-84855-206-7

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Article

Carriers — Contract — Liability for negligence

Abstract

Carriers — Contract — Liability for negligence

Details

Managerial Law, vol. 8 no. 3
Type: Research Article
ISSN: 0309-0558

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