Let's Dump the 1916 Antidumping Act: Why the 1994 GATT Provides Better Price Protection for U.S. Industries

By DiSalvo, Nicole | Vanderbilt Journal of Transnational Law, May 2004 | Go to article overview

Let's Dump the 1916 Antidumping Act: Why the 1994 GATT Provides Better Price Protection for U.S. Industries


DiSalvo, Nicole, Vanderbilt Journal of Transnational Law


ABSTRACT

The U.S. Congress is currently considering a vote to repeal the 1916 Antidumping Act. The 1916 Antidumping Act makes the importation of foreign goods that were sold below market prices illegal if the foreign company had the "intent [to] destroy or injure an industry in the United States." Few claims have been adjudicated under the 1916 Act since its passage, and no plaintiff has won a case based solely on the 1916 Antidumping Act. Commentators reason that the strict intent requirement or the availability of remedies in other antitrust statutes has contributed to this phenomenon. Recently, there has been debate in the international trade community regarding the Act's compatibility with multinational trade treaties of which the United States is a signatory. The World Trade Organization found the 1916 Act inconsistent with antidumping provisions in 1994 GATT, and its Appellate Body upheld those decisions.

This Note discusses the history of the antidumping legislation and enforcement, the current international controversy surrounding the laws of the United States, and the costs and benefits of using international dispute resolution procedures to counteract foreign dumping in the United States if the 1916 Act is repealed.

TABLE OF CONTENTS

  I. INTRODUCTION
 II. 1916 ANTIDUMPING ACT LEGISLATION AND
     JUDICIAL INTERPRETATION
     A. Legislative History of the Act
     B. New Antidumping Legislation--The
        Government Steps In
     C. Early Case Law Interpreting the Act
     D. Interpretation of the Elements of the
        Antidumping Act of 1916
III. THE INTERNATIONAL APPROACH--ARTICLE IV
     OF THE GENERAL AGREEMENT ON TARIFFS
     AND TRADE 1994
     A. The Agreement
     B. The Dispute
     C. The Appellate Body Findings and
        Aftermath
 IV. INTERNATIONAL DISPUTE RESOLUTION AS THE
     SOLE REMEDY FOR DUMPING
     A. Discrepancies between the WTO Dumping
        Dispute Methodology and the 1916 Act
     B. International Dispute Settlement
        Procedures Provide the Best Remedy
        against International Dumping
  V. CONCLUSION

I. INTRODUCTION

On March 4, 2003, Rep. James F. Sensenbrenner, Jr., chairman of the House of Representatives Committee on the Judiciary, introduced in the 108th Congress H.R. 1073, (1) a bill to repeal the 1916 Antidumping Act as enacted in Section 801 of the Act of September 8, 1916. (2) The 1916 Antidumping Act makes the importation of foreign goods that were sold below market prices illegal if the foreign company had the "intent [to] destroy or injure an industry in the United States." (3) The conduct is a misdemeanor punishable by up to a one-year imprisonment and no greater than a $5,000 fine. (4) The Act also creates a private right of action for companies who believe they were victims of "dumping" by a foreign company and provides treble damages and "the cost of the suit, including attorney's fee." (5)

Few claims have been adjudicated under the 1916 Antidumping Act since its passage over eighty-five years ago. Commentators have suggested that the reason no plaintiff has ever won on straight 1916 Antidumping Act grounds is either the strict intent requirement read into the act by the small number of courts which have ruled on the subject, or that there are antitrust statutes that provide more appropriate relief in these situations. (6)

While adjudication of this Act has been light, (7) there has recently been much debate in the international trade community regarding its compatibility with multinational trade treaties of which the United States is a signatory. This concern for the Act's power has increased since a federal court in Utah held that the 1916 Antidumping Act, which had been used unsuccessfully by U.S. companies to sue foreign companies on antitrust grounds, could be used to tackle antidumping complaints. (8) The European Community (EC) and Japan filed separate World Trade Organization (WTO) complaints after Wheeling-Pittsburgh Steel Corporation settled a suit against Dufreco Steel alleging it had violated the 1916 Antidumping Act. …

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