Academic journal article William and Mary Law Review

In Need of Enlightenment: The International Trade Commission's Misguided Analysis in Sunset Reviews

Academic journal article William and Mary Law Review

In Need of Enlightenment: The International Trade Commission's Misguided Analysis in Sunset Reviews

Article excerpt

The United States is no different than most modern nations that trade products in the international marketplace. That is to say, as a result of its participation in the international trade arena, the United States has an extensive body of laws to regulate its trade with foreign nations. (1) The purpose of trade regulation varies depending upon an individual's philosophic persuasion. One individual may view trade regulation as a synonym for protectionism in which trade with other nations is discouraged, while another may interpret trade regulation as a means to protect domestically manufactured goods from unfair competition. Regardless of one's opinion on the need for trade regulation, its omnipresence in today's international marketplace demands careful analysis.

Trade regulation is not a recent phenomenon, but rather a resilient force whose indiscrete character morphs over time, evolving with changes in the global economy. (2) In the present era, in which the General Agreement on Tariffs and Trade (GATT) (3) takes center stage, nontariff barriers (NTBs) (4) have replaced tariffs (5) as the favored mechanism of trade regulation. (6) According to one commentator, "[t]ariffs no longer matter in international trade law.... Nontariff barriers are what matter in late twentieth and early twenty-first century international trade law, leaving protectionists with few remaining weapons to achieve their goals." (7) As quickly as nations agree to reduce certain barriers to trade, new forms of NTBs emerge to perpetuate the practice of protectionism. (8) Included among the protectionist's arsenal of NTB "weapons" are antidumping and countervailing duty laws. Since the 1980s these laws have been the U.S. "weapon of choice" to protect domestic industries. (9)

Nations justify the existence of antidumping and countervailing duty laws as a means to counterbalance the "unfair" trade practices of dumping (10) and subsidization. (11) In the United States, countervailing duties (CVDs) are imposed to compensate for subsidies received by foreign producers, and antidumping duties (ADs) are imposed to compensate for the sale of imported products at less than their fair market value. (12) Historically, AD and CVD orders established by the United States tended to endure without any scheduled termination. (13) At the conclusion of the Uruguay Round in 1994, (14) however, the United States amended its trade laws to include a mandatory review mechanism for AD and CVD orders, known as a "sunset review." (15)

According to one commentator, "The [Uruguay Round Agreements Act] fundamentally changed the antidumping and countervailing duty section of the amended United States Tariff Act of 1930...." (16) The sunset review provision, however, has not yet led to a widespread discontinuation of AD and CVD orders. (17) In this regard, those who originally envisioned the sunset review as a means to dramatically reduce trade barriers to the U.S. market may well be disappointed. The question, therefore, remains whether the failure of the ITC to revoke a substantial number of AD and/or CVD orders is attributable to either (a) the failure of the URAA to bring about significant substantive changes in the domestic AD and CVD laws or (b) the misinterpretation of the legal standards to be applied during sunset reviews by the Department of Commerce (Commerce), the International Trade Commission (ITC), or both.

This Note analyzes the domestic administrative processes used to establish AD and CVD orders and critiques the review mechanism that can lead to removal of these orders. Essentially, this Note examines the legal standards applied during sunset reviews and concludes that the ITC's interpretation of these standards is misguided and fails to honor the legislative intent underlying sunset reviews. (18)

Using the sunset reviews of AD and CVD orders in Magnesium from Canada (19) as a case example, this Note suggests that the standards of review applied by the ITC in sunset reviews are flawed in three respects. …

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