CITAC urges Commerce to end zeroing policy

The Consuming Industries Trade Action Coalition on Friday urged the U.S. government to end the use of zeroing in antidumping cases in the wake of yet another World Trade Organization Panel decision that the U.S. government's use of the controversial methodology runs contrary to WTO obligations.

   The organization said that U.S. exporters and consumers will bear the brunt of the U.S. failure to comply with the latest WTO ruling.

   Our trading partners will soon begin retaliation against U.S. exports because of this failure, and U.S. manufacturers and consumers are paying the price every day, because these trade duties are unfairly calculated, CITAC said.

   On this latest case, a WTO Panel ruled that the U.S. failed to implement earlier decisions against the distortive practice of eroing in antidumping cases, said CITAC counsel Lewis Leibowitz, a partner at the law firm of Hogan & Hartson, LLP. With this decision, the WTO has begun the process of permitting retaliation by the European Union against U.S. exports for failure to abide by international trading rules. Soon Japan and Mexico will have this authority as well.

   Despite this, Commerce has refused to end the methodology, even though it imposes excessive duties on American consuming industries. With the threat of increased use of trade cases by petitioning companies in the current downturn, zeroing has the potential to harm a lot more Americans and make recovery more difficult. Zeroing artificially inflates dumping margins by disregarding negativedumping comparisons (where the U.S. sales price exceeds the foreign 搉ormal value when calculating an aggregate margin of dumping for a product, CITAC said. In effect, the negative comparisons are treated as though they were equal to zero.

   Zeroing has always been bad policy because it hurts U.S. manufacturing by creating unfair market distortions for consuming industries in this country,CITAC Executive Director Jon Wadsworth said. 

Source: American Shipper