Trade Cases

Currency Manipulation to Be Subject to Countervailing Duties

Written by Sandy Williams

A new regulation from the U.S. Department of Commerce allows currency manipulation by foreign governments to be considered a subsidy subject to countervailing duties.

“This Currency Rule is an important step in ensuring that unfair trade practices are properly remedied,” said Secretary of Commerce Wilbur Ross. “While successive administrations have balked at countervailing foreign currency subsidies, the Trump administration is taking action to level the playing field for American businesses and workers.”

A countervailable subsidy is defined by Commerce as a “financial contribution from a government or public entity that is specific and provides a benefit to a foreign producer or exporter.”

The new regulation identifies certain criteria that Commerce would use to determine if countervailing duties should be imposed in cases of currency under-valuation.

“In assessing whether there has been such government action, Commerce will not normally include monetary and related credit policy of an independent central bank or monetary authority,” said the Department. “Commerce will seek and generally defer to Treasury’s expertise in currency matters.”

Currently, Commerce maintains 515 antidumping and countervailing duty orders on a variety of products. During the Trump administration, 198 antidumping and countervailing duty investigations were initiated, up from 168 percent from the comparable period in the Obama administration.

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