Countervailing Duties are tariffs imposed by a country on imported goods that have been subsidized by the exporting country’s government, with the aim of leveling the playing field and protecting domestic industries from unfair competition.
Countervailing Duties (CVDs) are trade policy tools used to counteract the negative effects of subsidies provided by foreign governments to their exporters. These subsidies can include direct financial support, tax breaks, or other economic benefits that give foreign producers an unfair advantage in the global market. By imposing CVDs, the importing country seeks to neutralize this advantage, ensuring that domestic producers can compete fairly. The imposition of CVDs follows an investigation by the importing country’s trade authorities, who must determine that the subsidies have caused material injury to the domestic industry. These duties are crucial for maintaining fair trade practices and protecting the economic interests of domestic industries affected by subsidized imports.
Countervailing Duties