Countervailing Duty (CVD)

Countervailing duty (CVD) is the trade-remedy tariff used against government subsidies rather than dumping. When a foreign government subsidises an exporter — through cheap state loans, below-market energy, or direct cash grants — and that creates injury to domestic producers in the importing country, CVD is the remedy. It doesn't punish the exporter; it offsets the subsidy.

CVD vs anti-dumping duty. ADD addresses goods sold below fair market value (dumping). CVD addresses goods produced with government subsidies. In practice, they are often imposed together — many ADD/CVD orders in the US cover the same products from the same origins. Both are calculated per exporter and adjusted each year via administrative reviews.

How it's calculated. The CVD rate equals the net subsidy amount per unit divided by the export price. Commerce determines which government programmes constitute "countervailable subsidies" and calculates the subsidy margin for each investigated producer. The result is a company-specific rate or, for non-cooperating exporters, an "all others" rate that is typically much higher.

Active US CVD orders. Major CVD orders currently in force cover: solar panels and modules from China (and certain Southeast Asian countries for circumvention), steel products from China, India, and other origins, aluminium extrusions from China, and various agricultural products. Check the ITA Antidumping and Countervailing Duty Trade Remedy Status database (enforcement.trade.gov) for the current order list.