What is a countervailing duty?
A countervailing duty is a special duty to offset the amount of subsidy on subsidized imports that are causing, or threatening to cause, material injury to domestic producers of like products. Subsidizing occurs when foreign producers receive financial contributions from their governments, which enable them to sell at lower prices in the marketplace. Unlike an antidumping investigation, therefore, countervailing duty investigations focus on the subsidy practices of foreign governments.
