United States of America: Requirement for cash deposits in AD/CVD cases
In a final rule published in the Federal Register on October 3, 2011 (Vol.76 No.191), the U.S. Department of Commerce announced that effective November 2, 2011, provisional measures in trade-remedy cases henceforth will normally take the form of a cash deposit. This rule will apply to all investigations initiated on the basis of petitions filed on or after this effective date
In a proposed rule published in the Federal Register on April 26, 2011 (Vol.76 No.80) the U.S. Department of Commerce had proposed to modify its regulation that states that provisional measures during an antidumping (AD) or countervailing duty (CVD) investigation usually take the form of a bonding requirement. The modification, if adopted, would establish that the provisional measures during an AD or CVD investigation will normally take the form of a cash deposit. During the provisional measures period in antidumping and countervailing duty investigations, the department is instructed by the Act to order “the posting of a cash deposit, bond, or other security, as the administering authority deems appropriate.”
Comments on this proposed rule were due May 26, 2011.
The department argues that cash deposits better ensure that importers bear full responsibility for any future antidumping and countervailing duties they may owe. While most of the duties on entries secured by a bond during the provisional measures period are ultimately collected, these collections can be very slow and involve burdensome administrative problems for U.S. Customs and Border Protection (CBP).
The department also states that this change will bring the United States in line with the practices of other World Trade Organization (WTO) members. Commerce is aware of no other WTO member that is currently permitting importers the option of posting bonds during the provisional measures period of AD and CVD investigations. The second sentence of 19 CFR 351.205(a) states that, “[t]he remedy (sometimes referred to as ‘provisional measures’) usually takes the form of a bonding requirement to ensure payment if antidumping or countervailing duties ultimately are imposed.” The department proposes deleting most of this sentence because U.S. importers would normally no longer be permitted to post bonds during the provisional measures period.
Further, to clarify that provisional measures will take the form of cash deposits Commerce proposes adding a sentence to 19 CFR 351.205(d) that states, “[w]ith respect to section 703(d)(1)(B) and 733(d)(1)(B) of the Act, the Secretary will normally order the posting of cash deposits to ensure payment if antidumping or countervailing duties ultimately are imposed.” This change, in the fdepartment's view, places the requirement for cash deposits in the appropriate part of 19 CFR 351 (i.e., in the part that explains the effects of an affirmative preliminary determination). These modifications would reflect the department’s change in practice of normally requiring cash deposits rather than bonds during the provisional measures period.
 The provisional measures period is the period between the publication of the Department’s preliminary affirmative determination and the earlier of (1) the expiration of the applicable time period set forth in sections 703(d) and 733(d) the Tariff Act of 1930, as amended (the Act), or (2) the publication of the International Trade Commission’s final affirmative injury determination.
Any Evidence-Based Deliberation:
|Is there anything in the public record to suggest that evidence of the effectiveness of the proposed measure was considered during official deliberations?||Yes|
|Is there any evidence that alternatives to the proposed measure were considered?||Don't Know|
|Is there anything in the public record that suggests that empirical evidence informed the comparison across the alternatives available to government?||Yes|
|Was such evidence identified?||Don't Know|
|Is such evidence publicly available?||Don't Know|
|Did the official decision-maker in question provide an explanation as to why a chosen measure was favoured over alternatives?||Yes|
|Is there any evidence to suggest that potentially affected trading partners were consulted before the measures were taken?||Yes|
|Is there any evidence that safeguards have been put in place to ensure that implementation of the initiative is transparent and non-discriminatory?||Yes|
|Did the government state its intention to review the measure within one year of implementation?||No|
Date of inception:
GTA Evaluation: Amber
See the hyperlinked material in the description.