ADD/CVD Best Practices
ADD/CVD Best Practices
Antidumping and countervailing duties (AD/CVD) are imposed to protect domestic industries from unfair foreign pricing and government subsidies that
distort the free flow of goods and adversely affect American businesses in the global marketplace. Importers need to review the scope of AD/CVD orders
to determine whether its merchandise falls under the scope of an order. As a best practice, you should always query an HTS code at the 8- and 10-digit
level to determine if an AD/CVD Case applies. In addition, a close review of the case description and nature of the goods is needed to determine if the
goods fall within the scope of an AD/CVD Case.
It is important to understand that the AD/CVD rate declared to Customs at the time of entry is an estimated rate. The liquidation process for AD/CVD
cases can take several years for each entry. Scope descriptions, binding rulings and court decisions change frequently and can be complicated.
Importers are often caught by surprise when an entry liquidates at a higher AD/CVD rate than anticipated. This is usually the result of the foreign supplier’s
inability to support its preliminary (or “cash deposit”) rate assigned at the time of entry. The loss of a preferred rate can be caused by something as simple
as the failure to respond to a U.S. Department of Commerce questionnaire that is sent by mail. Working with an experienced broker or legal counsel is the best
way to avoid costly mistakes and errors associated with AD/CVD duties.
(Courtesy of Meeks, Sheppard, Leo & Pillsbury LLP)
After a spike in new petitions filed in FY 2020, new filings have been dropping in recent years, with 35 reported filings in FY 2022. This is down from a whopping
114 new AD/CVD filings in 2020. Most notable is the significant decline in new petition filings involving products from China. The Section 301 tariffs imposed on
certain goods from China is playing a key role in this reduction. Despite this trend, there are still nearly 700 active orders affecting imports from 59 countries.
Heed the advice from Meeks, Sheppard, Leo & Pillsbury LLP to frequently check HTS codes to confirm if AD/CVD will apply before goods are purchased for import into the US.
This best practice will help avoid Supply Chain disruptions as well as unexpected additional expense.