August 22, 2008

US DOC finds unfair subsidies in Chinese rectangular tubes

The US Department of Commerce found that imports of rectangular pipe from China benefited from unfair subsidies. DOC’s preliminarily found that Chinese producers and exporters of rectangular pipes received countervail able subsidies ranging from 0.27% to 77.85%. A final decision is currently due in April 2008.

From 2004 to 2006, imports of rectangular pipe from China increased 839.79% by volume and were valued at an estimated USD 44.11 million in 2006.

Rectangular pipe can be used for fencing, window guards and railing for the construction industry, but is not used for the conveyance of liquid or gas.

Mr David Spooner assistant secretary for import administration of US DOC said that “The administration looked at the facts and found that China has subsidized imports of certain pipe and tube sold in the United States. The Administration is committed to aggressively enforcing US trade laws to achieve a strong and fair trading relationship.”

US’s domestic manufacturers have a right to petition Commerce and the International Trade Commission to impose tariffs to counteract foreign subsidies. Commerce investigates the existence of subsides and the ITC separately determines whether domestic manufacturers are injured by the subsidized imports. In March 2007, Commerce applied the countervailing duty law to China for the first time.