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“Sunset” Investigations Before the U.S. International Trade Commission
Andrea C. CassonOffice of General Counsel, USITC
June 2, 2005
Background about USITC
History of Agency– Established in 1916 as the U.S. Tariff
Commission.– Created as a factfinding and advisory body
rather than a policymaking body.– Renamed the U.S. International Trade
Commission in 1974 – The ITC is located in Washington, DC, with a
staff of about 370 employees and an annual budget of $50 + million.
– ITC staff includes a wide range of experts, including economists, commodity industry analysts, investigators, and attorneys
USITC Background, continued
USITC Mission is two-fold• To administer U.S. trade remedy laws in a
fair and objective manner
• To provide trade policymakers with independent, quality advice and information on matters of international trade and competitiveness.
USITC background, continued
USITC is headed by six CommissionersThe Commissioners are appointed by the President and confirmed by the U.S. Senate.Commissioners serve 9-year terms that are set by statute. The Chairman and the Vice Chairman are appointed by the President to serve two-year terms in those positions.The incoming Chairman cannot be of the same political party as the previous Chairman, and the Chairman and Vice Chairman cannot be of the same political party.
Sunset Reviews:Relevant Statutory Provisions
Section 751(c) of the Tariff Act of 1930 (19 U.S.C. 1675 (c))
Procedural five-year review provisions for DOC and ITC
Section 751(d) of the Tariff Act of 1930 (19 U.S.C. 1675(d))
Legal standard for reviews
Section 752 of the Tariff Act of 1930 (19 U.S.C. 1675a)
Details substantive standards for ITC review
Relevant Regulations
19 Code of Federal Regulations, Subpart F 19 C.F.R. 207.60-207.69 Contains ITC’s Procedural Requirements and
Timeframes for Five-Year Reviews
Legal Standard for ReviewsU.S. law requires five-year reviews of
Antidumping duty orders Countervailing duty orders Suspension Agreements
Order or Agreement under review will be revoked unless Commerce determines that dumping or countervailable subsidy will be likely to continue AND ITC determines that material injury will be likely to continue or recur
Likelihood of Continuation or Recurrence of Injury
Commission considers Likely Volume
Absolute, or Relative to U.S. production or
consumption Likely Price Effects Likely Impact
of the subject imports on the industryif the order is revoked.
Other factors taken into account
The prior injury determination
Any improvement related to the order
Vulnerability of the industry
In antidumping proceedings, Commerce’s duty absorption findings.
Volume Considerations
Would likely volume be significant? Relevant Economic Factors
Likely increase in foreign production capacity Likely increase in foreign unused capacity Existing inventories of subject merchandise Likely increases in existing inventories Barriers to importation in other countries Potential for product-shifting
Price Considerations
Likelihood of significant price underselling
Likelihood of significant price suppression or depression
Likely Impact
Mandatory consideration of all relevant economic factors, including Output, sales, market share Profits and other financial factors Utilization of capacity Employment, wages, productivity Development and production efforts
Optional consideration of Magnitude of dumping margin Magnitude of countervailable subsidy
Cumulation
Permissible if—Reviews were initiated the same day ANDLikely competition among imports ANDLikely competition with domestic like
product
Prohibited if— No discernable adverse impact
Notice of Initiation
Published in Federal RegisterBefore 5 year anniversary of orderRequests statement from interested
partiesWillingness to participate in reviewLikely effects of revocationOther information and industry data
requested by the ITC
Full Reviews
New facts collected Questionnaires sent to foreign producers and
U.S. producers, importers & purchasers
Hearing conductedFull briefing by partiesDecision issued within 360 days after
initiationMay be appealed to Court of International
Trade and then to U.S. Court of Appeals
Transition Orders
• The first round of reviews began in 1998.• The initial reviews concerned “transition
orders,” that is orders that were in place in 1994 when the statute was amended.
• The first set of reviews of transition orders ended in February 2001.
• Commission conducted 68 grouped reviews of 233 orders.
• In addition, during 2000 and 2001, the Commission conducted sunset reviews of orders that were issued in 1995 and 1996.
Second Round of Reviews
Commission has continued to conduct reviews of orders that were put in place after the passage of the URAA, on their five-year anniversaries.
Starting in 2004, the Commission began the second round of five-year reviews of the transition orders that were kept in place after the first round of five-year reviews.