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Details |
| Definition |
Tariffs imposed to neutralize the adverse effects of subsidies provided by a foreign government to their export industries. |
| Purpose |
To protect domestic industries from unfair competition due to imports subsidized by the exporting country’s government. |
| Investigation & Imposition |
Requires a domestic investigation to confirm the presence of subsidies and their impact on domestic industries. |
| WTO Compliance |
Imposition of CVDs must comply with World Trade Organization rules. |
| Types of Subsidies |
Includes direct transfers of funds, tax concessions, loan guarantees, and provision of goods/services at a discount. |
| Calculation |
The duty amount is typically equivalent to the value of the foreign subsidy. |
| Duration |
Not permanent; imposed for a specific period and subject to review and removal. |
| Global Use |
Frequently used by countries like the United States, European Union, Canada, and India. |
| Controversy and Disputes |
Can lead to trade disputes, viewed by some as protectionist or unjustified. |
| Impact on Prices |
May result in higher prices for affected goods in the importing country due to increased import costs. |