On February 4, 2020, the Office of Enforcement and Compliance within the International Trade Administration of the U.S. Department of Commerce (Commerce) issued a Final Rule, available here, that expands the tools by which it may determine that foreign governments have provided subsidies to encourage the production and export of goods — triggering Commerce’s authority to apply countervailing duties on U.S. imports of those products.1
Commerce has done so in two significant and hotly contested ways. First, the Final Rule establishes a methodology by which Commerce will determine whether a foreign producer or exporter has benefited from foreign government policies that cause its currency to be undervalued, and to quantify any such undervaluation. Second, the Final Rule expands the definition of a “group” to include a collection of “enterprises that buy or sell goods internationally,” for the purpose of determining whether an alleged subsidy is “specific” to a “group of enterprises or industries.” This “specificity” requirement is a prerequisite to a finding by Commerce that a subsidy may be countervailed.
Sidley Austin LLP provides this information as a service to clients and other friends for educational purposes only. It should not be construed or relied on as legal advice or to create a lawyer-client relationship.
Attorney Advertising - For purposes of compliance with New York State Bar rules, our headquarters are Sidley Austin LLP, 787 Seventh Avenue, New York, NY 10019, 212.839.5300; One South Dearborn, Chicago, IL 60603, 312.853.7000; and 1501 K Street, N.W., Washington, D.C. 20005, 202.736.8000.