Low Tax Principles

The basic principle that the amount of anti-dumping duty should not exceed thedumping margin is prescribed in The Agreement of Anti-Dumping. However, it doesnot mean that the amount of anti-dumping duty be equivalent to the anti-dumpingmargin. As a matter of fact, The Agreement of Anti-Dumping encourages the WTOmembers to levy less duty than the dumping margin which is called Lesser Duty Rule.According to this rule, apart from the dumping margin, the investigating authoritiesshould calculate the injury margin, and make a comparison between these twomargins to choose the lesser as the anti-dumping duty. To determine Non-InjuriousPrice is crucial to the application of LDR. The injury margin is determined by thedifference between NIP and the import price provided by the exporters. So thedetermination of NIP is the most important step in the calculation of injury margin. Itis advised that there are two general calculating methods, namely, price undercuttingand price underselling. So far, EU, Australia, South Korea have played the leadingrole in the practice of LDR, among which only EU makes LDR mandatory. The lackof practice leads to the disagreement in the Rule Negotiation of WTO. It is indicatedthat there is still a long way to carry out LDR in every WTO members.