News & Insights

China Subsidy Exchange

August 25, 2016

The United States Continues to Hammer Illegal Chinese Subsidies


The United States has eight pending countervailing duty investigations targeting numerous forms of illegal Chinese subsidies, including grants, preferential loans, tax exemptions, preferential land-use rights, and raw materials and inputs at below-market prices. The U.S. International Trade Commission (ITC) and the U.S. Department of Commerce (Commerce) completed the preliminary phase of five investigations and will now move into the final phase. Below are descriptions of these five cases and the subsidies preliminarily found to be provided to Chinese producers of the subject imports:*Iron Mechanical Transfer Drive Components - On April 1, 2016, Commerce preliminarily determined that imports of iron mechanical transfer drive components benefitted from illegal subsidies, including the provision of inputs for less than adequate remuneration, preferential loans from both private and state-owned banks, income tax credits and preferential tax rates, preferential land-use rights, government grants to producers, and import tariff and VAT exemptions for imported equipment. Commerce preliminarily calculated subsidy rates ranging from 2.68 percent to 166.77 percent on these imports. Commerce is scheduled to make its final determination on or before October 21, 2016. Click here to read the fact sheet.

*Biaxial Integral Geogrid Products - On June 17, 2016, Commerce preliminarily determined that imports of biaxial integral geogrid products benefitted from illegal subsidies, including the provision of inputs for less than adequate remuneration, preferential loans from both private and state-owned banks, tax reductions/deductions (including for research and development), preferential land-use rights, government grants to producers, and payments from the Foreign Trade Promotion Fund. Commerce calculated subsidy rates ranging from 16.60 percent to 128.27 percent on these imports. Commerce is scheduled to make its final determination by October 31, 2016. Click here to read the fact sheet.

*Amorphous Silica Fabric - On June 27, 2016, Commerce preliminarily determined that imports of amorphous silica fabric benefitted from illegal subsidies, including the provision of electricity for less than adequate remuneration and preferential loans from both private and state-owned banks. Commerce preliminarily calculated subsidy rates ranging from 4.36 percent to 104.10 percent on these imports. Commerce is scheduled to make its final determination on or before November 7, 2016. Click here to read the case.

*Truck And Bus Tires On June 26, 2016, Commerce determined that imports of truck and bus tires benefitted from illegal subsidies, including the provision of inputs for less than adequate remuneration, preferential loans from both private and state-owned banks, tax reductions/deductions (including for research and development), preferential land-use rights, government grants to producers, export sellers credits from state-owned banks, technical improvement grants, and VAT exemptions for imported equipment. Commerce preliminarily calculated subsidy rates ranging from 17.06 percent to 23.38 percent on these imports. Commerces final determination is due by November 9, 2016. Click here to read the fact sheet.

*Stainless Steel Sheet and Strip - On July 11, 2016, Commerce preliminarily determined that imports of stainless steel sheet and strip benefitted from illegal subsidies, including the provision of inputs for less than adequate remuneration, preferential loans from both private and state-owned banks, tax credits for research and development, export sellers credits from state-owned banks, technical improvement grants, deed tax exemptions, and import tariff and VAT exemptions for imported equipment. Commerce preliminarily calculated subsidy rates ranging from 57.30 percent to 193.12 percent on these imports. Commerce is scheduled to make its final determination by November 23, 2016. Click here to read the fact sheet. In addition, three additional investigations received affirmative preliminary determinations from the ITC and are now in the middle of preliminary phase investigations by Commerce:

*1-hydroxyethylidene-1, 1-diphosphonic acid preliminary determination due on or before August 29, 2016;

*Carbon and Alloy Steel Cut-To-Length Plate - preliminary determination due September 6, 2016; and

*Ammonium Sulfate - preliminary determination due October 24, 2016.