Antidumping and International Pricing
Capital Trade’s economic consultants assist law firms and companies in all phases of antidumping proceedings, from pre-petition assessment to antidumping order compliance monitoring and review. Our experience in U.S. antidumping cases is extensive, encompassing over one hundred different proceedings, involving dozens of different products from over twenty five countries. We also have worked on antidumping cases filed by other governmental authorities, including the European Community and Brazil. We also use our highly specialized skills in cost accounting and pricing analysis in antitrust and transfer pricing projects.
Defining the Parameters of an Investigation
Companies and law firms must address a number of technical issues in the early phase of every antidumping action. We assist clients in the analysis of these critical parameters, including:
Pre-petition antidumping margin assessments
Cost/benefit analysis of participation in a proceeding
Analysis of product scope and matching issues
Sales below cost allegations and rebuttals
Surrogate country assessment for nonmarket economy cases
Preparing Price and Adjustment Data
One of the most difficult and critical elements of any antidumping proceeding is the preparation and analysis of transaction-specific pricing and adjustment data. Government investigative agencies, such as the U.S. Department of Commerce, require comprehensive data on prices, discounts, rebates, transportation charges, and selling expenses. In many cases, this information must be sourced and compiled from multiple locations and/or multiple information systems, and merged into a single database. The data must be prepared rapidly and accurately. Capital Trade has extensive experience in:
Reviewing accounting and production records
Preparing allocation and data matching methods
Drafting narrative questionnaire responses and technical appendices
Coordinating the collection and merging of data from multiple sources
Preparing data for submission to the Department of Commerce
Analyzing Cost of Production
Nearly every antidumping proceeding requires the analysis and calculation of model or product specific cost of production information. Capital Trade has worked on numerous antidumping proceedings involving cost of production on products as diverse as fresh cut flowers, semiconductors, and cement. We assist our clients by:
Developing model or product specific costing systems for companies which lack such information in their normal accounting system
Applying specialized current cost methodologies in “hyperinflationary” economies
Assessing the reasonableness of company accounting methods and host country generally accepted accounting principles
Conducting arm’s length pricing analysis of inputs provided by affiliated parties
Calculating factor of production information for producers in economies considered to be “nonmarket”
Our extensive knowledge of cost of production issues can also be extremely useful in other arenas, such as antitrust, customs, and production efficiency analysis.
Assisting at Verification and Public Hearings
On-site verification of submitted information is a standard part of antidumping and countervailing duty investigations. Capital Trade assists companies in preparing for these arduous audits, and provides assessments of the ensuing official verification reports. In addition, we support law firms and companies in crafting technical arguments for briefs and other submissions. For companies facing verification, briefings or public hearings, Capital Trade can:
Prepare document traces
Represent clients at on-site verification
Provide technical arguments and analysis for briefs
Testify at public hearings
Meet with government officials
Computer Analysis of Pricing and Trade Data
Effective responses in antidumping and other international pricing proceedings require the rapid analysis and submission of voluminous computerized data. Capital Trade has substantial experience in the demanding field of litigation support, and our computer professionals understand the importance of accuracy and short turnarounds. In addition to programming expertise, Capital Trade staff also are highly skilled in antidumping and statistical analysis. Our services include:
Product model matching;
Antidumping margin simulations;
Computer file preparation;
Arm’s-length pricing analysis;
Design and installation of in-house price monitoring systems;
Customs duty calculation and entry liquidation;
Antitrust data compilation.
Capital Trade’s combination of experience in litigation support and computer technology can provide your business with a critical technical edge.
Assessing the Strategic and Commercial Implication of Trade Actions
A company’s position on trade regulatory actions, such as antidumping proceedings, should be framed in conjunction with its overall business objectives. Capital Trade looks at how potential or actual trade actions can affect the whole enterprise, from global trade and investment flows, to the day-to-day requirements of the MIS Department. We advise companies on:
Strategic risks and rewards associated with participation in trade proceedings
Assessing the potential costs of trade cases, in terms of impact on sales, production costs, and human resources.
Considering alternative sourcing strategies
Particular Market Situation Allegations and Analysis
Antidumping investigations at the Department of Commerce sometimes involve the allegation of a Particular Market Situation that necessitates an adjustment to the cost of a key input in the cost of production. For certain commodities, including steel products, Commerce relies upon an econometric model that was originally developed by Capital Trade and must be updated for each new investigation. Capital Trade has extensive experience in:
The preparation of Particular Market Situation allegations;
The data collection and econometric analysis required for the quantification of the Particular Market Situation adjustment;
Integration of the Particular Market Situation adjustment within the broader antidumping methodology.
Price Monitoring
Companies that are subject to antidumping orders or are potential targets for antidumping duty charges can reduce and even eliminate their antidumping duty liability by establishing a price-monitoring program. Capital Trade’s consultants have combined their extensive antidumping analytical, technical, and data processing expertise to develop a liability reduction and elimination program that can be tailored to meet each client’s budget and expectations. We provide the specialized diagnostic, analytical, computer programming, data processing, and training assistance crucial to the design and implementation of an effective price monitoring regime.
Designing Data Collection Procedures
In particular, Capital Trade is skilled in the evaluation and diagnostic analysis of software capabilities, in-house data processing skills, and electronic order, pricing, and financial and cost accounting systems as they relate to the retrieval and compilation of antidumping information and the establishment of a price-monitoring program. We will:
Identify the location of key antidumping data;
Establish procedures for extracting data, and gathering and processing off-line selling and cost information;
Prepare methods for allocating and calculating expenses;
Guide your staff in the creation of the detailed sales and cost of production databases necessary for antidumping duty liability calculations;
Determine the amount of time, in-house programming, and human resources needed to compile and prepare these databases and implement a price-monitoring program;
Evaluate in-house data processing and programming skills;
Identify and recommend revisions to existing systems to facilitate antidumping data retrieval and analysis.
Estimating Current Antidumping Liability
To ensure accurate price-monitoring calculations, a company must first estimate its current duty liability. The computer programs used to estimate current liability are the backbone of any price-monitoring program. Capital Trade’s skilled computer professionals have intimate knowledge of the antidumping methodologies and calculations used by the U.S. Department of Commerce and can:
Tailor antidumping computer programs to address the product in question and to reflect a client’s unique sales and cost information;
Revise antidumping investigation computer programs to reflect administrative review/price-monitoring calculation methodologies;
De-bug and correct existing SAS code and computer programs;
Calculate current liability estimates;
Identify and analyze U.S. and home market pricing and selling patterns;
Isolate margin-generating products and sales;
Develop customized price-monitoring calculations and computer programs.
Training and Post-Implementation Technical Support
Some companies prefer that outside consultants operate the monitoring program throughout the duration of the project. Other clients may rely on consultants to establish and initially operate the program, but gradually move the program in-house. Still other clients may prefer to operate the entire program in-house from its inception. Whatever a company’s preference, Capital Trade can train and prepare your staff to handle any level of participation and responsibility, and will provide the skills necessary to operate and maintain an effective price-monitoring program. For example, our professionals can train your personnel to:
Understand basic and/or advanced U.S. antidumping duty methodologies and calculations;
Retrieve, compile and process antidumping databases;
Execute and revise antidumping duty and price-monitoring computer programming; and,
Understand, generate, and revise price-monitoring reports.
To complement our training services, we also provide post-implementation technical support throughout the life of the project. As various price-monitoring responsibilities are moved in-house, our consultants are available to answer all questions, to provide analysis and support, and assist with all computer programming and data processing needs.
