US confirms Russia’s status as market economy, but Moscow says decision needs cautious assessment

The US Commerce Department confirmed the market status of the Russian economy for US anti-dumping procedures, a decision Moscow sees as positive but intends to study in detail, the Economic Development Ministry says.

“This is the first time the US Department of Commerce (DOC) is conducting an assessment procedure for the revocation of the country’s market status. The… decision will have to be studied in detail.
At the same time, it gives a positive signal that Russian exporters retain the entire arsenal of opportunities to protect their interests in American anti-dumping procedures, and that the United States does not intend to neglect its commitments to the World Trade Organization (WTO),” Deputy Minister of Economic Development Vladimir Ilyichev told TASS.

Washington’s decision was based on the results of a probe conducted by the DOC following a statement filed earlier this year by American urea-ammonia mixture producers, who demanded a revocation of Russia’s status as a market economy. After a wave of interviews with stakeholders and public hearings in which Russian exporters and officials took part, the DOC confirmed Russia’s status in a memorandum published on October 29, stating that it didn’t find sufficient ground to withdraw Russia’s market economy status for the purposes of anti-dumping procedures.

“This decision implies that the US Department of Commerce will not return to the dumping calculation methods applied to exporters from the USSR and Russia before its accession to the WTO,” Ilyichev stated.

Market status was initially granted to Russia by the DOC in 2002. Up to that point, Russia was considered a country with a ‘non-market’ economy, which allowed the US to provide a special method for determining dumping in which export prices were compared with the sum of the costs and profits associated with each export product in a third country whose economy is considered a market economy. The use of this method harms the ability of exporters to protect their interests, and often leads to excessive anti-dumping duties.

Market status, on the other hand, provides for the comparison of export prices with costs in the actual country of export, according to the standard methodology provided by the WTO, thus protecting exporters’ interests.

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