"I am pleased that NAM decided to join our growing coalition to help level the playing field for American manufacturers competing against unfairly subsidized imports from China," said English, a member of the House Ways and Means Trade Subcommittee. "This endorsement reflects the necessity of this legislation and the urgency of the underlying problem of China's unfair trading practices. While China tries to determine if it will comply with its trade obligations, our manufactures should be able to use the full gamut of trade remedies, including countervailing duties against countries that refuse to play by the rules."
"We appreciate the support offered to this legislation by the members and leadership of NAM," Davis said. "We are all working towards making our markets more fair with this legislation, and we will continue to build on this momentum as we seek final passage in Congress."
Countervaling duties allow the U.S. government to impose tariffs equal to the amount of the subsidy a foreign government provides to its exporters. While U.S. companies can file antidumping duty cases against dumped Chinese products, they cannot file CVD cases. However, since the illegal trade practices of dumping and subsidization are not necessarily related, allowing American employers to file CVD cases against subsidies is as important as allowing them to file antidumping cases. The Department of Commerce considers China a non-market economy and, as a result of a previous ruling, will not accept CVD cases against China. H.R. 3716 and S. 2122 correct that problem by allowing domestic employers to file CVD cases against all non-market economies, including China and Vietnam.
"The overwhelming NAM vote in favor of our legislation demonstrates that American manufacturers, both large and small, need tools to combat the illegal trade practices of nations such as China," Collins said. "Our current law is obviously not providing those tools."
"U.S. manufacturing companies and their workers deserve a level playing field. Our legislation will protect American jobs by sending a powerful message to China and other non-market economies that the U.S. not going to tolerate overwhelming government subsidies," Collins added.
"Through their work with our nation''s manufacturers, NAM understands how important this legislation is to ensuring that our workers have a fair playing field when they compete with companies overseas," Bayh said. "Regardless of the technical definition of a country''s economic market, if their unfair trade practices are hurting American workers and closing our companies, we should be able to use every available resource to go after them."
Reflecting the growing Congressional support for English's approach, Senators Collins and Bayh introduced Senate bill 2212, a bill mirroring English's legislation. To date the following organizations have officially endorsed H.R. 3716: American Forest & Paper Association; American Foundry Society; American Iron and Steel Institute; American Manufacturing Trade Action Coalition; American Textile Machinery Association; Catfish Farmers of America; Committee on Pipe and Tube Imports; Committee to Support U.S. Trade Laws; Copper and Brass Fabricators Council; Cotton Council; Metals Service Center Institute; National Association of Manufacturers; National Council of Textile Organizations; Non-Ferrous Founders Society; North American Die Casters Association; Precision Metalforming Association; Printing Industries of America, Inc.; Specialty Steel Industry of North America; Steel Manufacturers Association; The Association for Manufacturing Technology; United Steel Workers of America; Vanadium Producers & Reclaimers Association
In related news, the U.S.–China Economic and Security Review Commission (USCC) said in its report, released to Congress on June 15, that "[it] recommends that Congress urge the Department of Commerce to make countervailing duty laws applicable to non market economies. If Commerce does not do so, Congress should pass legislation to achieve the same effect. U.S. policy currently prevents application of countervailing duty laws to non market economy countries such as China. This limits the ability of the United States to combat China's extensive use of subsidies that give Chinese companies an unfair competitive edge." English testified on the non-market economy issue before the USCC in September 2003.
Countervaling Duty law is found in Subtitle A of title VII of the Tariff Act of 1930, as amended by the Trade Agreements Act of 1979 and amended by the Trade and Tariff Act of 1984, the Omnibus Trade and Competitiveness Act of 1988, and the Uruguay Round Agreements Act of 1994. English's bill amends title 7 of the Tariff Act of 1930 so that provisions relating to the application of CVDs to foreign government subsidies are applied to non-market economies, including China.
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