Amid nearly perpetual talk of Chinese tariffs and presidential accusations that the economic rival is guilty of being a currency manipulator, the Department of Commerce is looking to protect and empower U.S. companies.
The Department has issued a notice of proposed rulemaking to impose countervailing duties on countries that act to undervalue their currency relative to the dollar, resulting in a subsidy to their exports.
U.S. law defines a countervailable subsidy as a financial contribution from a government or public entity that is specific and provides a benefit to a foreign producer or exporter.
“This change puts foreign exporters on notice that the Department of Commerce can countervail currency subsidies that harm U.S. industries,” Commerce Secretary Wilbur Ross said in a statement. “Foreign nations would no longer be able to use currency policies to the disadvantage of American workers and businesses. This proposed rulemaking is a step toward implementing President Trump’s campaign promise to address unfair currency practices by our trading partners.”
The draft regulation identifies the criteria the Department would use to determine if countervailing duties should be imposed for currency undervaluation.
Since the beginning of President Trump’s term in office, Commerce has initiated 164 new investigations in the area of antidumping and countervailing duty enforcement. Commerce says it currently maintains 481 antidumping and countervailing duty orders which provide relief to American companies from the harmful effects of unfairly traded imports into the U.S.