ACCA Applied Skills · Corporate and Business Law (Global) · International trade, international legal regulation and conflict of laws
Dolvia, a WTO member, finds that a foreign exporter is selling steel in Dolvia at a price well below its normal price in the exporter's home market, and that this is injuring Dolvia's domestic steel industry. Which action is Dolvia permitted to take under the WTO framework?
Dolvia may impose an anti-dumping duty on the steel, but only after an investigation establishes dumping, material injury to its domestic industry and a causal link between the two. A blanket ban without investigation is not allowed, nor can it set the exporter's home prices.
- AImpose an anti-dumping duty on the imported steel, provided dumping, material injury and a causal link are shown through an investigationCorrect
- BBan all imports from the exporter's country across every product sector without any investigation
- CRequire the exporter to raise its home-market price to match the price in Dolvia
Explanation
Selling below normal value in an export market is dumping. WTO rules allow an importing member to impose anti-dumping duties after an investigation shows dumping, material injury to the domestic industry and a causal link between them. A blanket ban without investigation is not permitted, and a member cannot dictate another country's domestic prices.
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