U.S. Department of Commerce Issues Affirmative Preliminary Antidumping Duty Determination on Imports of 100- to 150-Seat Large Civil Aircraft from Canada
(Source: U.S. Department of Commerce; issued Oct 06, 2017)
Today, U.S. Secretary of Commerce Wilbur Ross announced the affirmative preliminary determination in the antidumping duty (AD) investigation of 100- to 150-seat large civil aircraft from Canada. As AFA, Commerce applied the sole dumping margin calculated in the petition for Canadian exports of aircraft, which is 79.82 percent. This rate will apply to all other producers/exporters as well.
The Commerce Department will instruct U.S. Customs and Border Protection to collect cash deposits from importers of 100- to 150-seat large civil aircraft based on this preliminary rate.
“The United States is committed to free, fair and reciprocal trade with Canada, but this is not our idea of a properly functioning trading relationship,” said Secretary Ross. “We will continue to verify the accuracy of this decision, while do everything in our power to stand up for American companies and their workers.”
Although Canadian civil aircraft subject to this investigation have not yet been imported, an April 2016 press release announcing the sale of Canadian civil aircraft to a U.S. airline valued the order to be in excess of $5 billion.
The petitioner is The Boeing Company (IL).
Enforcement of U.S. trade law is a prime focus of the Trump administration. From January 20 through October 5, 2017, the Commerce Department has initiated 65 AD and countervailing duty (CVD) investigations – a 48 percent increase from the previous year, and a 16-year peak in the number of investigations initiated in a single fiscal year. The Commerce Department currently maintains 411 AD and CVD duty orders which provide relief to American companies and industries impacted by unfair trade. Antidumping laws provide U.S. businesses and workers with an internationally accepted mechanism to seek relief from the harmful effects of dumping unfairly priced products into the United States.
Commerce is currently scheduled to announce its final AD determination in this investigation on December 19, 2017.
If the Commerce Department makes an affirmative final determination of dumping and the U.S. International Trade Commission (ITC) makes an affirmative final injury determination, Commerce will issue an AD order. If the Commerce Department makes a negative final determination of dumping or the ITC makes a negative final determination of injury, the investigation will be terminated and no order will be issued.
for a fact sheet on today’s decision.
The U.S. Department of Commerce’s Enforcement and Compliance unit within the International Trade Administration is responsible for vigorously enforcing U.S. trade laws and does so through an impartial, transparent process that abides by international rules and is based solely on factual evidence.
Foreign companies that price their products in the U.S. market below the cost of production or below prices in their home markets are subject to antidumping duties.
In fiscal year 2016, the United States collected $1.5 billion in duties on $14 billion of imported goods found to be under-priced, or subsidized by foreign governments.
Statement on Commerce Department Antidumping Duties Preliminary Decision
(Source: Bombardier; issued Oct 06, 2017)
MONTREAL --- “We strongly disagree with the Commerce Department’s preliminary decision. It represents an egregious overreach and misapplication of the U.S. trade laws in an apparent attempt to block the C Series aircraft from entering the U.S. market, irrespective of the negative impacts to the U.S. aerospace industry, U.S. jobs, U.S. airlines, and the U.S. flying public.
The Commerce Department’s approach throughout this investigation has completely ignored aerospace industry realities. Boeing’s own program cost accounting practices – selling aircraft below production costs for years after launching a program – would fail under Commerce’s approach. This hypocrisy is appalling, and it should be deeply troubling to any importer of large, complex, and highly engineered products.
Commercial aircraft programs require billions in initial investment and years to provide a return on that investment. By limiting its antidumping investigation to a short 12-month period at the very beginning of the C Series program, Commerce has taken a path that inevitably would result in a deeply distorted finding.
We remain confident that, at the end of the processes, the U.S. International Trade Commission will reach the right conclusion, which is that the C Series benefits the U.S. aerospace industry and Boeing suffered no injury. There is wide consensus within the industry on this matter, and a growing chorus of voices, including airlines, consumer groups, trade experts, and many others that have come forward to express grave concerns with Boeing’s attempt to force U.S. airlines to buy less efficient planes with configurations they do not want and economics that do not deliver value.
The U.S. government should reject Boeing’s attempt to tilt the playing field unfairly in its favor and to impose an indirect tax on the flying public through unjustified import tariffs.
Commerce’s statement that Bombardier is not cooperating with the investigation is a disingenuous attempt to distract from the agency’s misguided focus on hypothetical production costs and sales prices for aircraft that will be imported into the United States far in the future.
As we have explained repeatedly to the Department, Bombardier cannot provide the production costs for the Delta aircraft for a very simple reason; they have not yet been produced. Commerce’s attempt to create future costs and sales prices by looking at aircraft not imported into the United States is inappropriate and inconsistent with the agency’s past practices. This departure from past precedent and disregard of well-known industry practices is an apparent attempt to deprive U.S. airlines from enjoying the benefits of the C Series, even though Boeing abandoned the segment of the market served by the C Series more than a decade ago.
This action also puts thousands of high-technology U.S. jobs at risk given the C Series’ significant U.S. content. More than half of each aircraft’s content, including its engines and major systems, is sourced from U.S. suppliers. Going forward, the C Series program will generate more than $30 billion in business for U.S. suppliers and support more than 22,700 jobs in the United States.”
Bombardier is the world’s leading manufacturer of both planes and trains. Looking far ahead while delivering today, Bombardier is evolving mobility worldwide by answering the call for more efficient, sustainable and enjoyable transportation everywhere. Our vehicles, services and, most of all, our employees are what make us a global leader in transportation.