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What are Unfair Foreign Subsidies and How Do They Affect American Companies and Workers?
Under the Administration's National Export Initiative (NEI), U.S. companies--large and small--are
increasingly selling American-made products in markets across the globe. When selling overseas,
many companies find themselves at a disadvantage to foreign competitors who benefit unfairly from
financial assistance from foreign governments. Such "subsidies" can take many forms, including:
- Export loans or loan guarantees at preferential rates
- Tax exemptions for exporters or favored companies or industries
- Assistance conditioned on the purchase of domestic goods
- R&D grants for the development and commercialization of new technologies
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What is the Subsidies Enforcement Office and What Can It Do for You?
ITA's Enforcement and Compliance (E&C) knows that U.S. exporters, manufacturers and workers
can be highly successful in diverse industries and overseas markets when they can
compete on a level playing field. However, it is clear that not all foreign companies
or governments always play by internationally accepted rules. IA's Subsidies Enforcement
Office (SEO) is committed to confronting foreign government subsidies and related trade
barriers that impede U.S. companies' and workers' ability to expand into and compete
fairly in these crucial markets. With a variety of resources and tools at its disposal,
the SEO provides:
- A dedicated staff that continually monitors and analyzes foreign subsidies and intervenes, where possible and appropriate, to challenge harmful foreign subsidies.
- Resources to find information on a wide range of foreign government subsidy practices, including our online Subsidies Library.
- Counseling services to American companies on the tools available to address unfairly subsidized imports.
- An experienced staff that provides advice to U.S. companies whose exports are subject to foreign countervailing duty (anti-subsidy) actions and that takes an active role in such cases to defend U.S. interests.
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This year, the SEO vigorously defended the interests of over 40 U.S.
exporters subject to foreign anti-subsidy investigations, whose
overseas markets across a variety of industries have ranged from
$127 million to over $2 billion.
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What Other Remedies Are Available To Combat Unfair Foreign Subsidies?
In addition to the SEO services noted above, under the U.S. trade remedy laws and
international trade rules if a foreign subsidy meets certain conditions, the U.S.
government could take the following steps, where appropriate:
- Impose special duties (i.e., countervailing duties) on subsidized imports that are injuring U.S. industries.
- Challenge foreign subsidization through the dispute settlement system of the World Trade Organization.
The SEO recently developed an effective advocacy strategy to help
a medium-sized U.S. aerospace exporter to address foreign subsidies
that impeded its ability to compete in overseas markets.
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What is the Next Step?
Contact the SEO if you believe subsidized imports are harming your company
or foreign subsidies are impeding your ability to export and compete abroad.
SEO experts can evaluate the situation to determine what tools under U.S.
law and international trade rules are available to effectively address the
problem. Working together we can combat harmful foreign subsidies, to ensure
that high quality, export-related jobs in the United States are created and
preserved.
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