On October 18, 2024, the U.S. Department of Commerce released its final results regarding the countervailing duty administrative review of large diameter welded pipe from the Republic of Türkiye. This review examined the period from January 1, 2022, to December 31, 2022, focusing on subsidies provided to producers and exporters in Türkiye. The findings indicated that significant government support had influenced the pricing of these products, raising concerns about fair trade practices.
The review's preliminary results were published on June 6, 2024, prompting an evaluation of various subsidy programs that benefited the manufacturers involved. Companies like Çimtaş Boru Imalatari Ticaret Ltd and HDM Çelik Boru Sanayi ve Ticaret A.S. were specifically examined. As part of the review, Commerce found that both companies had received financial contributions from the Turkish government, giving them an unfair advantage in pricing their products in the U.S. market.
The final determination showed that the total net countervailable subsidy rates were 2.18% for Çimtaş Boru and 6.31% for HDM Çelik. These rates reflect the extent to which government support influenced the cost structure of these companies, allowing them to sell their welded pipes at lower prices than would be possible without such subsidies. This undermines U.S. manufacturers who compete in the same market, highlighting the ongoing challenges domestic producers face against subsidized foreign competition.
Commerce’s methodology for assessing these subsidies is rigorous and grounded in U.S. trade laws. Each subsidy identified was evaluated to ensure it constituted a benefit to the recipient and was specific in its application. This means that the financial support was directed towards particular companies or industries rather than being broadly available, which is a key consideration in determining the legality of the subsidies under international trade agreements.
The final report and accompanying Issues and Decision Memorandum provide a comprehensive overview of the review process, including responses to comments made by involved parties. For instance, the concerns raised by HDM Çelik regarding the nature of the subsidies and their classification were thoroughly examined and addressed. This transparency is crucial for ensuring that all stakeholders understand the basis for the final decisions made by Commerce.
As a result of these findings, the U.S. can impose countervailing duties on imports of large diameter welded pipes from Türkiye to offset the impact of these subsidies. This step is part of a broader strategy to ensure fair competition in the U.S. market, supporting domestic manufacturers who argue that they cannot compete against products sold at artificially low prices due to government backing.
