The U.S. International Trade Commission (ITC) has set a preliminary date of 18 January to discuss a petition by the Coalition of Gulf Shrimp Industries for countervailing duties against seven foreign countries the coalition feels are using subsidies to unfairly stack the deck against domestic shrimp processors.
“It’s in everyone’s best interests to have these discussions,” said David Veal, the coalition’s executive director.
The Louisiana-based coalition filed the petition last month, accusing the nations of China, Ecuador, India, Indonesia, Malaysia, Thailand and Vietnam of using government subsidies to drive down the cost of producing shrimp in those countries.
As a result, according to the petition, the price of imported shrimp from those countries in the United States has been driven down, providing an unfair advantage against the American shrimp industry, which is commonly referred to as “dumping.”
“For a decade or so, it’s been struggling,” he said, referring to the industry in general and the coalition’s 28 member companies, which include shrimp processors in Texas, Florida, Alabama, Mississippi and Louisiana.
Under World Trade Organization law, the United States, if it has enough evidence that the dumping practice is happening, has the right to impose duties, called countervailing duties, on shrimp coming from those counties, in order to balance prices.
This is the second time the coalition has filed such a petition in the past decade. The last time, Veal said, was in 2005, and cited some of the same nations mentioned in the newer petition. In 2005, Veal said, the coalition accused exporters from those countries of deliberately selling shrimp in the U.S. market at below-cost prices. That petition, Veal said, resulted in the government doling out duties to those nations to compensate for the dumping practice.
This time, however, Veal said the foreign governments are involved, too, offering subsidies as high as 15-30 percent to its shrimp producers. The coalition wants the U.S. government to again issue duties to level the playing field.
The 18 January meeting, to be held in Washington, D.C., represents the beginning of the U.S. government’s response to the petition. Margaret O’Laughlin, public affairs officer for the ITC, declined to comment on the specifics of the coalition’s petition, but talked in general about how such a case is handled.
Both the ITC and the U.S. Department of Commerce, O’Laughlin said, will conduct separate investigations into the allegations. The goal, she said, is to determine whether the foreign governments are in fact subsidizing the exports, and whether that is adversely affecting the local industry.
In total, such a joint investigation, O’Laughlin said, typically takes “roughly a year,” and requires a series of steps along the way, where decisions will be made as to whether to continue the investigation.
If it turns out the coalition’s allegations have merit and warrant action, O’Laughlin said the Commerce Department will issue the appropriate duties, which will then be applied by U.S. customs officials, just like any other duty.
Officials from the governments named in the petition have not issued any public responses so far, but published reports indicate a delegation from India is coming to the United States to speak on the government’s behalf. Just where and when that will take place is not clear, and Veal said he has not been notified of any talks with Indian officials, but said he would welcome a dialogue.
“We’ll certainly have discussions with anyone who is willing to help us develop free trade,” he said.
