New Bipartisan Legislation Aims to Make it Tougher for China to Dodge Trade Laws
Sens. Tammy Baldwin (D-Wis.), Shelley Moore Capito (R-W. Va.), Debbie Stabenow (D-Mich.) and Bill Cassidy (R-La.) introduced a new bill on Tuesday to “crack down on unfair trade cheating from nonmarket economies like China.”
O.K., we know: We need to be more specific here.
The Senators want to give the Commerce Department more power to hold China and other countries accountable when they evade anti-dumping (AD) and countervailing duties (CVD).
For those unfamiliar with this area of U.S. trade law, the United States issues AD/CVD duties when imported products are found to be sold below market value or to have received significant government subsidies when being produced. The idea is to level the playing field a bit for American workers and companies, who operate in a free and open market.
As the Senators note, AD/CVD rules are pretty common, and most countries follow them without issue. But nonmarket economies — especially China — work overtime to dodge these duties, engaging in “a sophisticated and government-backed effort to avoid the duties required.”
For example, China “alters their products slightly to get around the rules, violating the spirit of the law, if not the letter.” It isn’t individual Chinese companies doing this, remember: China uses “its vast government resources” to ensure these firms are able to evade U.S. trade laws and avoid the duties.
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