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52783464 Dumping and Anti Dumping Laws

52783464 Dumping and Anti Dumping Laws

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Published by Nasir Hasan Khan

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Published by: Nasir Hasan Khan on Jun 02, 2011
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Dumping (pricing policy

From Wikipedia, the free encyclopedia Jump to: navigation, search This article is about the economics term. For industrial relations and social justice issue, see Social dumping. For the tax avoidance term, see SUTA dumping. In economics, "dumping" can refer to any kind of predatory pricing. However, the word is now generally used only in the context of international trade law, where dumping is defined as the act of a manufacturer in one country exporting a product to another country at a price which is either below the price it charges in its home market or is below its costs of production. The term has a negative connotation, but advocates of free markets see "dumping" as beneficial for consumers and believe that protectionism to prevent it would have net negative consequences. Advocates for workers and laborers however, believe that safeguarding businesses against predatory practices, such as dumping, help alleviate some of the harsher consequences of free trade between economies at different stages of development (see protectionism). The Bolkestein directive, for example, was accused in Europe of being a form of "social dumping," as it favored competition between workers, as exemplified by the Polish Plumber stereotype. While there are very few examples of a national scale dumping that succeeded in producing a national-level monopoly, there are several examples of dumping that produced a monopoly in regional markets for certain industries. Ron Chenow points to the example of regional oil monopolies in Titan : The Life of John D. Rockefeller, Sr. where Rockefeller receives a message from Colonel Thompson outlining an approved strategy where oil in one market, Cincinnati, would be sold at or below cost to drive competition's profits down and force them to exit the market. In another area where other independent businesses were already driven out, namely in Chicago, prices would be increased by a quarter. [1] A standard technical definition of dumping is the act of charging a lower price for a good in a foreign market than one charges for the same good in a domestic market. This is often referred to as selling at less than "fair value". Under the World Trade Organization (WTO) Agreement, dumping is condemned (but is not prohibited) if it causes or threatens to cause material injury to a domestic industry in the importing country. [2]

in the worst case. It only serves the purpose of providing remedy to the domestic industry against the injury caused by the unfair trade practice of dumping. However. It provides relief to the domestic industry against the injury caused by dumping. . Dumping can harm the domestic industry by reducing its sales volume and market shares. This in turn can result in decline in profitability.com. in its legal sense. anti dumping is an instrument for ensuring fair trade and is not a measure of protection for the domestic industry. Anti dumping is a measure to rectify the situation arising out of the dumping of goods and its trade distortive effect. the purpose of anti dumping duty is to rectify the trade distortive effect of dumping and re-establish fair trade. In fact.Dumping . it is said to be 'dumping' the product. as well as its sales prices. Anti dumping measures do not provide protection per se to the domestic industry. means export of goods by a country to another country at a price lower than its normal value. On the other hand. job losses and. Often. Thus. dumping implies low priced imports only in the relative sense (relative to the normal value). it is a misunderstanding of the term.cn) Updated: 2006-10-09 14:58 If a company exports a product at a price (export price) lower than the price it normally charges on its own home market (normal value).Anti-Dumping (chinadaily. Thus. in the domestic industry going out of business. dumping. and not in absolute sense. The use of anti dumping measure as an instrument of fair competition is permitted by the WTO. dumping is mistaken and simplified to mean cheap or low priced imports.

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