Countervailing Duty Investigation

A Countervailing Duty Investigation is the formal procedure conducted by the Commerce Department and the USITC to determine whether to impose countervailing duties. The investigation runs in parallel with — or in addition to — an antidumping investigation, and procedures are governed by 19 CFR Part 351.

Key procedural milestones:

1. Petition — Filed simultaneously with any companion AD petition. The petition identifies specific subsidy programs alleged to be countervailable.
2. Initiation and preliminary injury — Commerce initiates within 20 days; USITC issues a preliminary injury determination within 45 days.
3. Preliminary CVD determination — Commerce typically issues within 85 days of initiation (faster than AD because subsidies are easier to verify than dumping margins).
4. Final CVD determination — Roughly 75 days after the preliminary.
5. Final injury determination — USITC determines material injury within 45 days of Commerce's final.
6. Order — Affirmative determinations by both agencies result in a countervailing duty order.

Commerce verifies subsidy programs by issuing questionnaires to the foreign government and to mandatory respondent producers. Verification includes on-site reviews of company books and records, as well as government program documentation. Common subsidy categories include preferential lending, debt forgiveness, tax holidays, provision of inputs (electricity, land, raw materials) for less than adequate remuneration, and grants.

CVD investigations against non-market economies — particularly China and Vietnam — became routine after the 2007 GPX Tire decision and the 2012 legislation confirming Commerce's authority to apply CVD to those countries.