The United States has imposed a 6.14% import duty on paper bags and packaging produced by Finieco, a Portuguese company based in Santo Tirso. This decision follows accusations of ‘dumping,’ where products are sold below market value to undermine local competitors.
Key Takeaways
- The US Department of Trade has imposed a 6.14% duty on Finieco’s paper bags and packaging.
- The decision follows an anti-dumping investigation covering April 2022 to March 2023.
- Importers will have to pay back around $1.19 million based on 2022 data.
- Finieco exports over 80% of its products overseas and is partly owned by German group Papier-Mettler.
Background
Dumping is a form of predatory pricing in international trade, where manufacturers export products at prices below the normal market rate. This practice aims to increase market share by driving out local competition, potentially leading to a monopoly where the exporter can control prices and quality.
The Investigation
The US Department of Trade initiated an anti-dumping investigation in June 2023, focusing on the period from April 1, 2022, to March 31, 2023. The investigation concluded that Finieco was selling its paper bags and packaging at prices lower than those in the US market. As a result, a 6.14% duty was imposed on these imports.
Financial Impact
The duty means that US importers of Finieco’s products will have to pay back approximately $1.19 million based on total imports of $19.48 million for the year 2022-2023. Importers will need to present a percentage of the imported products to US customs, which will calculate the duty based on the value of future purchases.
Company Profile
Finieco is a major exporter, with over 80% of its paper packaging products sold overseas. The company is 50% owned by the German paper group Papier-Mettler. Despite the significant impact of the US decision, Finieco has not yet made any public comments.
Conclusion
Trade treaties often include mechanisms to address dumping, such as countervailing duty penalties and anti-dumping statutes. The US decision to impose a duty on Finieco’s products aims to protect local manufacturers from unfair competition and maintain market stability.
Sources
- US accuses Portuguese company of product ‘dumping’ – Essential Business, – Essential Business.