Definition
What Are Antidumping and Countervailing Duties (AD/CVD)?
Antidumping (AD) and countervailing duties (CVD) are extra US tariffs imposed when foreign producers sell goods in the US below normal value (AD) or receive government subsidies (CVD). They are product- and country-specific, can exceed 100%, and apply on top of base HTS duties, Section 301, and IEEPA.
How AD differs from CVD
Antidumping duties are imposed when a foreign producer sells goods in the US at less than 'normal value' — typically the home-market price or a constructed value based on cost plus profit — and the dumping injures a US industry. Countervailing duties are imposed when a foreign government provides subsidies (grants, preferential loans, tax benefits, underpriced inputs) that disadvantage US competitors. Both require an injury finding by the US International Trade Commission before duties are imposed.
Why AD/CVD rates are sometimes very high
AD rates are calculated by comparing US export price to home-market value. For 'non-market economy' countries — most importantly China — Commerce uses a 'surrogate country' methodology that frequently produces high rates. Producers who do not participate in Commerce's annual administrative reviews receive the 'adverse facts available' (AFA) rate, which is usually the highest rate in the order. AFA rates exceeding 100% or even 200% are not unusual.
The cash-deposit-vs-final-rate problem
When you import a product subject to an AD/CVD order, you pay a cash deposit at the rate in effect at entry. Commerce then conducts an annual administrative review that may set a different rate retroactively. The entry liquidates at the final review rate, and you pay any shortfall (or receive a refund) sometimes years after import. Importers without supplier-specific rate visibility can be hit with very large retroactive bills.
Checking whether your product is covered
The International Trade Administration maintains a searchable database of all active AD/CVD orders. Search by country and product description. Read the scope language carefully — AD/CVD orders describe coverage by physical characteristics and HTS codes. If your product is arguably within scope, request a formal scope ruling from Commerce. CBP enforces AD/CVD at the border and through post-entry audit; ignorance is not a defense.
Frequently asked questions
- Are AD/CVD duties the same as Section 301?
- No. Section 301 targets Chinese-origin goods broadly under the Trade Act of 1974. AD/CVD orders are product- and country-specific and require a formal injury finding by the International Trade Commission. AD/CVD rates can be much higher than Section 301 rates, and they apply on top of all other duties.
- How do I find out if my supplier has a specific AD rate?
- Commerce publishes individual rates for producers who participate in administrative reviews. Search the case docket on the ITA's website or ask the supplier directly for their assigned rate. A supplier that has not been reviewed may default to the country-wide AFA rate, which is typically the highest in the order.
- Can a third-country sourcing strategy avoid an AD/CVD order?
- Sometimes — but Commerce conducts circumvention investigations when a third country (commonly Vietnam) is used to assemble Chinese components and ship the resulting goods to the US. If circumvention is found, the third-country product is brought within scope. Substantial transformation analysis is critical; sham assembly is not enough.
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Related in-depth guides
Longer-form articles that go deeper than the definition above.
AD/CVD — practical guide
Major active orders, the cash-deposit problem, and supply-chain risk allocation.
Substantial transformation
When third-country manufacturing actually shifts origin and avoids AD/CVD circumvention findings.
CF-28, CF-29, and protests
The CBP enforcement mechanism that often surfaces AD/CVD scope disputes.