Both the U.S. Senate and U.S. House of Representatives have passed bipartisan legislation that enables countervailing-duty proceedings to continue against allegedly unfair subsidized goods – including wind turbine towers – from China and Vietnam.
The legislation overturns a decision made by the Court of Appeals for the Federal Circuit (CAFC) and confirms that the U.S. Department of Commerce (DOC) has the authority to continue to apply countervailing duties to non-market economies, such as China's.
According to the House Ways and Means Committee, if the CAFC's decision were allowed to stand, the DOC could be forced to end countervailing duties against products from China. In addition, the six ongoing investigations against Chinese and Vietnamese products would be terminated. If this were to happen, the committee says, some duties that already have been collected would have to be refunded.
The bill also addresses a finding by the World Trade Organization (WTO) that there may be a "double counting"of Chinese subsidies for countervailing and antidumping on the same good. Under the new legislation, the DOC would be able to adjust anti-dumping duties to address double counting.
"I am pleased that the House passed this important legislation, which preserves our ability to address China's unfair subsidies," Rep. Kevin Brady, R-Texas, chairman of the House Ways and Means' trade subcommittee, said in a statement. "We cannot allow China to pick winners and losers in the marketplace by bankrolling its companies and giving them an unfair advantage against U.S. companies and workers.
"This legislation provides a WTO-consistent tool to offset these market-distorting subsidies," he added. "It also ensures that we do so without violating our own WTO commitments. Given that the Senate has already acted on an identical bill, I hope that it is quickly signed and enacted by the president."
According to the House Ways and Means Committee, the legislation was drafted with input and support from the Obama administration, so it is likely that the president will sign the bill.