Trade Law Exercise Dirty play but by Whom

Within the confines of the one nation’s borders products are valued at similar levels known as the normal value of the product. However, foreign goods may be cheaper and offer greater utility to the consumers. When goods move from one nation to another such that the receiving nation’s products normal value is higher than that of foreign received goods value, the resulting market situation is known as dumping1. 2.1. WTO Stance on Dumping WTO deals with dumping based issues but does not elucidate strict and formal rules and laws that may be enforceable. Instead, the boundaries for dumping and anti-dumping cases are based on peculiar circumstances of each case. Specific WTO laws do not prohibit dumping per se but do provide guidelines to deal with dumping based practices. The regulatory regime of the WTO promotes the idea that dumping should be condemned if it is deemed harmful to the domestic industry of the importing nation. As per Article VI of the GATT 1994 and as per Article 2.1 of the Anti-Dumping Agreement the phenomenon of dumping has been defined as the introduction of a product into the commerce of another country at less than its ‘normal value’. 2.2. WTO Dumping Treatment The WTO regime is based on the mutual consent of individual members that are nation states as well as large business entities. However, for most given circumstances the WTO regime places emphasis on nation states representing the problems of businesses registered within their domains. The WTO regime is not answerable for or accountable for the actions of individual businesses no matter where they operate. However, it must be kept in mind that pricing mechanisms are generally settled by individual businesses and not nation states so there is little option available to nation states to control the prices of foreign goods. This line of argumentation mandates that the WTO regime cannot prohibit dumping. The only real method to deal with the prices of imported goods are imposing large duties in order to make these goods uncompetitive but these actions are seen as enacting trade barriers that are opposed to the WTO regime. Therefore, it is not possible for individual nation states to increase duties without going against the basic WTO regime. Even so, it is undeniable that dumping is harmful to domestic industry so there needs to be a procedure to deal with dumping within the domain of the WTO umbrella. Article VI of the GATT 1994 clearly states that it is possible for member states to condemn dumping especially if it causes or threatens material injury to an established industry in the territory of a [Member] or materially retards the establishment of a domestic industry. In order to deal with dumping issues the Anti-Dumping Agreement and Article VI of the GATT 1994 provide a complete framework and procedural rules. Member states of the WTO regime are allowed to impose anti-dumping measures though they are not expected to do this on their own initiative. Instead of possessing an internalised or domestic anti-dumping framework, member states are expected to agree to Article 1 of the Anti-Dumping Agreement that requires any anti-dumping meas

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