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Abstract ▼ AI-Helper

The United States has maintained the position that current U.S. methodology for determining countervailing subsidies need not be changed even though they has not legally recognized by GATT(WTO) panels. The US Administration basically looks for the market benchmark to determine whether the government...

The United States has maintained the position that current U.S. methodology for determining countervailing subsidies need not be changed even though they has not legally recognized by GATT(WTO) panels. The US Administration basically looks for the market benchmark to determine whether the government intervention is consistent with commercial considerations for its loan or grants. However, the market benchmark is one which similar to the United States’s market. Thus, if the market were one difference to that assumed by the US Adminstration, the government behaviour allowed would be different and then be sanctioned. The second element of the Department of Commerce’s ‘consistent with market considerations’ test is what kind of behaviour is permitted by the government. The matter is that the Commerce’s test is not concerned with the actual effects of the subsidy, but in fact interfering in the domestic structures of the foreign country when applying its test. Because any government action in the market which is not consistent with the rational behaviour of a market actor in a plural and individualist market will be considered as a countervailing subsidy. It is not simply requiring a policy of low governmental intervention but one which is in accordance with America’s own hands off policy. Through its countervailing duty methodology, the US Administration is globalising the American model. Countervailing duties are not only protectionist instruments but also a means by which the United States both establishes the agenda of the international trading system and interferes in the domestic structures of foreign countries in order to advantage its own domestic organization. The Commerce’s past 349 countervailing duty investigations were an example of United States’ broad consensus on trade policy. The duties resulting from them were adopted both to protect domestic industry and to promote the country’s export interests by moulding an international trading system into a reflection of the American way.

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