Wednesday, January 11, 2017, 12:41 PM

Extension of Furniture Anti-Dumping Duties a Preview of Bigger U.S. Trade Protections to Come


Randy Hanson
Furniture Today is reporting the U.S. International Trade Commission voted this week to keep anti-dumping duties in place for another five years on wooden bedroom furniture made in China.

Parties active in the furniture industry are aware of longstanding and ongoing efforts among U.S. domestic producers to combat what they consider to be unfair pricing by Chinese manufacturers, claiming many foreign goods are priced below cost.  Such efforts to fight unfairly priced imports by turning to the ITC have gained periodic but passing notoriety, such as with the publication in 2014 of Beth Macy’s book about John Bassett III called “Factory Man: How One Furniture Maker Battled Offshoring, Stayed Local, and Helped Save an American Town.”  Bassett was described by National Public Radio as “a determined owner who fought back against the foreign onslaught — both by filing anti-dumping charges with the U.S. International Trade Commission against Chinese firms and by making his own company more competitive”.


With the election of Donald Trump, new and intense attention is being brought to the issue of the impact (and fairness or unfairness, depending on your point of view) of low-cost Chinese made goods in the U.S. marketplace.  What is news here is not the past imposition or continuation of tariffs, but the likelihood that these ongoing actions may serve as a model and as a springboard for an expansion of protectionist tariffs and other actions, both in the furniture industry and other industries.  The automotive sector has drawn particularly strong comments from the President-elect.

The challenge for U.S. domestic manufacturers seeking to turn the tide against perceived unfair foreign competition has been to identify successful avenues to mount legal challenges in the regulatory framework that has existed for the last several years.  The existing rules on what constitutes unfair trade are viewed by Trump to be part of the problem.  The campaign rhetoric offering a solution of “renegotiating” the rules, even at the treaty level as with NAFTA talks which the Mexican government says it now supports, is looking more likely.  The choice of Skadden Arps lawyer Robert Lighthizer, a former Reagan administration trade member, to lead the U.S. Trade Representative office is viewed as further confirmation of a coming new and more protectionist approach to trade.  

Perhaps the changes coming will not ultimately be as profound and game-changing as the implementation of NAFTA or the accession of the Chinese to the World Trade Organization in recent past decades.  But there is an expectation among all manufacturers, foreign and domestic, who are staked to the U.S. market there will be new and broader legal steps taken to protect domestic U.S. manufacturing.  These steps will extend well beyond the lone continuing action of the ITC on wooden bedroom furniture made in the People’s Republic of China.

Randy Hanson is a leader in the firm’s Global Business practice and a partner in the firm’s Corporate and Securities Practice Group. He specializing in corporate and commercial transactions, advising businesses and their owners on U.S. and cross-border corporate and commercial transactions. from offices in Washington, D.C. and North Carolina. His clients include emerging and middle-market companies, including closely-held businesses, from the Southeastern United States and from Latin America, Europe and Asia. He has extensive experience in industries such as furniture, textiles, commercial vehicles and parts, specialty chemicals, industrial and medical supply, broadcasting and consumer products.

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