Recall that the U.S. Court of Appeals for the Federal Circuit recently decided that the Department of Commerce (DOC) may not apply countervailing duties to non-market economy countries. The FT reports that the effort to amend U.S. law so as to overrule this decision has begun:
This week, Ron Kirk, US trade representative, and John Bryson, commerce secretary, sent a letter to Congress urging immediate legislation to overrule the court’s decision.
“This matter is of the utmost urgency,” the letter said, a copy of which has been seen by the Financial Times. “We stand ready to work with the Congress to enact specific legislation that would remedy the court’s flawed ruling.”
...
Although overturning the court ruling would be legislatively straightforward, some trade lawyers have warned that, with anti-China sentiment on Capitol Hill running high, there was a risk that Congress would insert more radical measures such as tariffs to punish China for undervaluing its currency.
So what would an amendment to the current statute look like? The article notes that, "Last year, a judicial panel at the World Trade Organisation said double-counting was not permitted. But the ruling said anti-dumping and countervailing duties might simultaneously be applied without violating this rule, depending on the methodology used." So, in amending the statute, WTO rules need to be taken into account. Perhaps Congress will try to keep the amended statute as vague as possible, in the hopes of delaying any WTO complaint until the statute is actually implemented by the DOC?
ADDED: Scott Lincicome has lots more to say on the issue here; and Dan Ikenson weighs in here.
