Reforming the Antidumping Agreement: A Road Map for WTO Negotiations

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In the current Doha Round of World Trade Organization talks,negotiations are now under way on the arcane, highly technical, andintensely controversial subject of antidumping rules. On the agendaare possible changes to the WTO Antidumping Agreement, which setsthe standards that govern national antidumping laws.

In the United States, current antidumping rules enjoy strongpolitical support. Defenders of the status quo allege that changesto the Antidumping Agreement will "weaken" the U.S. law and therebyexpose American industries to unfair, "dumped" competition. Inresponse to such concerns and at the United States' insistence, theDoha declaration that launched the new antidumping talks insists on"preserving the basic concepts, principles and effectiveness of[the Antidumping Agreement] and [its] instruments andobjectives."

Fears of weakening the U.S. law are misplaced. The object of WTOnegotiations is not to weaken national antidumping laws but toimprove them--by curtailing rampant abuses that allowtrade-restrictive antidumping remedies to punish normal, healthy,import competition. Such abuses run afoul of what supporters ofantidumping claim is the purpose of the laws: namely, to ensure a"level playing field" by targeting "unfair" trade practices thatreflect underlying market distortions. Accordingly, changes toantidumping rules are needed to bring national practice intoconformity with the "basic principles, concepts, and objectives" ofthe Antidumping Agreement.

This paper sets forth a detailed road map for the WTOantidumping negotiations. We start by fleshing out the basicconcepts, principles, and objectives of the AntidumpingAgreement--as elucidated by the justifications for antidumping lawsoffered by the U.S. government and prominent supporters of the U.S.law. Working from that foundation, we then outline 21 reformproposals designed to improve antidumping laws' aim and limit thecollateral damage inflicted on business practices that have nothingto do with "unfair trade."

Brink Lindsey and Daniel J. Ikenson

Brink Lindsey is director of the Cato Institute's Center for Trade Policy Studies. Dan Ikenson is a policy analyst at Cato's Center for Trade Policy Studies.