Government to Raise Anti-Dumping Duties, Weighing Inflation and Trade Factors

The Ministry of Finance and Economy is pushing to raise anti-dumping duties by taking into account domestic market structure and industrial competitiveness. The ministry believes it is necessary to upgrade anti-dumping measures as a trade remedy, and plans to reinforce qualitative factors on top of the existing quantitative method of setting duty rates.
According to reporting by Financial News on the 8th, the Ministry of Finance and Economy completed a confidential research project in December last year on a "Plan to Upgrade the Anti-Dumping Regime" and is now reviewing concrete implementation measures. The study, which covered issues such as how to adjust duty rates when imposing provisional and final anti-dumping duties and how to establish criteria and standard procedures for price undertakings, is understood to have focused on how to reflect in practice the tariff decision-making authority granted to the finance minister under the Customs Act.
Currently, anti-dumping duties are set by calculating the dumping margin—such as the difference between the normal value and the import price—and the level of relief needed for domestic industry injury, and then deriving a final duty rate. The Customs Act also stipulates that the finance minister may factor in industrial competitiveness, domestic market structure, price stability, and trade cooperation. In practice, however, these qualitative elements have not been reflected in the actual duty rates.
This is because the Ministry of Trade, Industry and Energy investigates dumping injury and calculates the duty rate according to a prescribed formula, then simply refers the result to the Ministry of Finance and Economy.
Under the current system, the Korea Trade Commission under the industry ministry investigates and rules on the existence of dumping and injury to domestic industry, while the Ministry of Finance and Economy makes the final decision on whether to impose duties and at what rate. The commission recommends an anti-dumping duty rate, and the finance ministry then finalizes it. Going forward, there is a possibility that the system will be revised so that qualitative indicators such as industry conditions, inflation, and trade relations are additionally considered in this process. This is seen as an attempt to strengthen the ministry’s grip on tariff decisions in a structure where its role has so far been relatively limited.
An official at the Ministry of Finance and Economy said, "We are seeing more and more dumping cases. That is why we created a dedicated anti-dumping team last year and used the research project to closely examine the ministry’s authority." The official added, "However, we are not looking at qualitative factors just to impose tougher duties," and continued, "The aim is to review anti-dumping duties from a broader perspective, including trade relations with counterpart countries."
junjun@fnnews.com, Reporter Choi Yong-jun, Reporter Seo Young-jun, Reporter Jeong Sang-gyun