U.S. laws authorize the imposition of AD/CV duties to remedy unfair trade practices of other countries and foreign companies that cause material injury (or threat thereof) to domestic industries, namely dumping (i.e., sales at less than fair market value), and countervailable foreign government subsidies. The AD/CV duty laws implement U.S. international obligations under the World Trade Organization (WTO) Agreement on Antidumping, and the Agreement on Subsidies and Countervailing Measures. Should the United States impose AD/CV duties on a product, the government of the exporting country may institute dispute resolution proceedings against the United States pursuant to the WTO Understanding on Dispute Settlement if it believes that the United States has violated its obligations under the WTO agreements. Antidumping duty. AD duty law provides relief to a domestic industry that is materially injured, threatened with material injury, or whose establishment is materially retarded by reason of imports sold in the United States at less than fair value. The law provides relief by authorizing the imposition of an additional import duty on the dumped imports. U.S. trade law permits the imposition of AD duties if (1) Commerce determines that the imported goods are or are likely to be sold in the United States at less than fair value; and if (2) ITC determines that a U.S. industry is materially injured or threatened with material injury, or that the establishment of an industry in the United States is materially retarded, by reason of imports of that merchandise. Countervailing duty. CV duty law provides a similar kind of relief to a domestic industry that is materially injured, threatened with material injury, or whose establishment is materially retarded by reason of imported goods that have received certain foreign government subsidies. The law provides relief by authorizing the imposition of an additional import duty on the subsidized imports. U.S. trade law provides that CV duties will be imposed if (1) Commerce determines that the foreign government or any public entity within the foreign country is providing, directly or indirectly, a countervailable subsidy with regard to the manufacture, production, or export of the subject merchandise that is imported or sold (or likely to be sold) for importation into the United States; and (2) if in the case of merchandise imported from a Subsidies Agreement country, ITC determines that a domestic industry is materially injured or threatened with material injury, or that the establishment of a domestic industry is materially retarded, by reason of imports or sales for imports of those goods. The process for obtaining the imposition of an AD/CV duty generally involves petitioners and interested parties who support and oppose the petition, trade law firms, Commerce, and ITC. Petitioners and interested parties in support of the petition may include domestic manufacturers, producers or wholesalers, and certain unions and trade associations. Parties in opposition to the petition for the imposition of duties may include foreign exporters and producers, U.S. importers of the articles under investigation, and governments of the exporting countries. Law firms that specialize in international trade frequently represent petitioners and the opposing parties before Commerce and/or ITC, the two agencies responsible for conducting AD/CV duty investigations. Commerce determines whether to initiate an AD or CV duty investigation after examining a petition filed on behalf of a domestic industry. Commerce conducts an investigation of dumping and/or subsidies while ITC simultaneously conducts a separate investigation of material injury to a domestic industry. Both Commerce and ITC make preliminary and final determinations before Commerce imposes an AD or CV duty. According to Commerce, the process for determining whether to impose an AD or CV duty consists of two key phases: (1) petition and (2) investigation. During the petition phase, a prospective petitioner gathers and presents information that might provide a reasonable basis for Commerce to believe that dumping or subsidization of a particular product might be occurring and causing or threatening material injury to a domestic industry, according to Commerce officials. Before deciding whether to petition for the imposition of AD/CV duties, the prospective petitioner considers the costs and benefits of doing so, including the time, administrative requirements, and legal costs associated with the process. U.S. law specifies that the petition allege the elements necessary for the imposition of the AD or CV duty. Commerce and ITC regulations require prospective petitioners seeking the imposition of AD/CV duties to provide detailed information, which is reasonably available to the petitioner, in their petition to Commerce and ITC. This information includes the composition of the domestic industry, identity of importers, volume and value of production of the domestic like product by the petitioner and each U.S. producer, and information concerning material injury. Prospective petitioners are also required to include information such as the proportion of total exports to the United States that the petitioners believe each producer is selling at less than fair value or benefiting from countervailable subsidies accounted for during the most recent 12-month period. For AD duty petitions, prospective petitioners should provide pricing and cost information relevant to calculating dumping margins. For CV duty petitions, prospective petitioners should provide factual information relevant to the alleged countervailable subsidy. In addition, prospective petitioners must demonstrate that they have sufficient support from the domestic industry. As prospective petitioners and their legal representatives contemplate whether or not to file a petition, they may request information or assistance from specialized offices within Commerce and ITC, described below: Commerce Import Administration’s Petition Counseling and Analysis Unit. Staff in this unit of Commerce’s International Trade Administration are available to help companies understand U.S. trade remedy laws dealing with dumping and countervailable foreign government subsidies and to provide technical assistance with preparing and filing a petition. According to Commerce officials, the department budgeted about $440,000 plus agency overhead for the Petition Counseling and Analysis Unit in fiscal year 2012. ITC’s Office of Investigations and Trade Remedy Assistance Office. Office of Investigations staff are available to counsel all companies seeking assistance in understanding the injury phases of AD/CV duty investigations, and regularly provide technical assistance and prepetition counseling to all companies, including SMEs. According to ITC officials, the agency dedicated about $59,500 plus agency overhead for prepetition counseling and assistance in 2012. The Trade Remedy Assistance Office was established to provide eligible small businesses, small trade and worker associations, and their representatives with additional information and support. According to ITC officials, the agency dedicated about $74,000 plus agency overhead for the Trade Remedy Assistance Office in fiscal year 2012. Once a petition is filed, Commerce has sole authority to initiate or not initiate an investigation based on its examination of the petition. In the 20 calendar days after a petition is filed, Commerce examines the proposed scope of the investigation, the domestic like product, industry support for the petition, the adequacy of the dumping or subsidy allegation(s), and the information provided to demonstrate injury, according to Commerce officials. If Commerce decides not to initiate an investigation at this point, the case is closed. During the investigation, Commerce sends a questionnaire to selected foreign producers and exporters (and the foreign government, in the case of a CV duty investigation), to collect information for its determination of whether imports are being dumped or subsidized. Commerce issues supplemental questionnaires as needed, to clarify certain information or obtain additional information. To establish the adequacy and accuracy of information submitted in response to questionnaires and other requests for information, Commerce conducts an on-site examination of the records of the party that provided the information and interviews company personnel who prepared the questionnaire responses and are familiar with the sources of the data in the responses. Commerce uses the information obtained to determine the appropriate amount of duty. According to Commerce, the agency may hold a hearing, upon request, to provide parties with an opportunity to express positions and respond to agency questions about factual and legal issues in the case. During its simultaneous investigation, ITC sends out separate, detailed questionnaires to collect trade, pricing, and market data from all U.S. producers, U.S. importers, and foreign producers of the product under investigation to determine whether these imported goods are causing material injury to the domestic industry. These questionnaires ask responding U.S. producers to indicate whether they support, oppose, or take no position on the petition. According to ITC officials, all data submitted by firms in questionnaires are treated as business proprietary, and thus, individual producer responses with regard to support of the petition are confidential. During the investigation, ITC holds a hearing that allows petitioners, other domestic producers, and opposing parties, who are typically represented by legal counsel, to express their position on the case and respond to questions that ITC Commissioners may have about factual information or legal issues in the case. Some parties within an industry may not support a petition for an AD/CV duty or at least not publically support a petition for a variety of reasons. For example, the product under investigation may be an input used by a domestic manufacturer or the distributor may represent domestic and foreign producers. Once a petition is filed, the length of time for completing an AD/CV duty investigation can range from 205 to 420 days, depending on whether it is an AD, CV, or joint AD/CV duty investigation, and the number of extensions applied as permitted under U.S. law. Generally, ITC makes a preliminary decision regarding material injury within 45 days after a petition is filed. If the ITC preliminary decision is negative, the investigation is terminated. If the ITC determination is affirmative, Commerce generally makes a preliminary decision regarding whether imports are being dumped or subsidized within 140 days after initiation for an AD duty case and 65 days for a CV duty case. Even if Commerce makes a negative preliminary decision, the investigation continues until Commerce makes its final decision, generally within 75 days of its preliminary decision. If Commerce’s final decision is negative, then the investigation is terminated and no further investigative action is taken by either agency. If Commerce’s final decision is affirmative, ITC generally makes a final injury decision within 45 days.