Countervailing Duty

A countervailing duty is an additional customs duty applied to imported goods that have benefited from subsidies provided by the exporting country’s government. These subsidies can give foreign producers an unfair advantage by allowing them to sell goods at artificially low prices. Countervailing duties offset this advantage and protect domestic industries from unfair competition. The duty is introduced following an investigation by the relevant authorities, which must show that subsidised imports are causing injury to domestic producers. It is applied on top of any standard import duties.

Countervailing duties help ensure fair trade conditions by neutralising the effects of government subsidies on international trade. 

 

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