By: Qinglan Long
According to the Tariff Act of 1930, “dumping” is the sale of goods imported from a foreign county at less than their “fair value” on the domestic market.2 Thus, a good produced and sold in China for twenty dollars, but sold in the United States for only fifteen dollars, may be considered “dumped” on the U.S. market. The lower price may be explained by the exporter’s desire to gain market share or to monopolize the receiving market by selling its merchandise at a lower price.3 After domestic manufacturers are driven out of the market, the dumping manufacturer will recoup its initial losses by charging a higher price. Dumping practices result in injured domestic industries. To counteract its negative effects, countries have devised rules against dumping.4 These rules, intended to nullify the impact of dumped merchandise on the domestic market, vary depending on the country from which the product originated and consider the various production factors and costs of the merchandise.