GlossaryEN1 min readUpdated: Jul 22, 2026
Countervailing Duty USA
Unlike anti-dumping duties, which target below-cost export pricing, a countervailing duty (CVD) is designed specifically to offset financial subsidies granted by a foreign government to its exporters.
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Source: https://www.trade.gov/countervailing-duties
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Definition & Explanation
Unlike anti-dumping duties, which target below-cost export pricing, a countervailing duty (CVD) is designed specifically to offset financial subsidies granted by a foreign government to its exporters. The U.S. Department of Commerce investigates whether such assistance – production grants, preferential state loans, tax concessions – gives foreign producers an unfair advantage over U.S. domestic industry. If a subsidy is confirmed and the U.S. International Trade Commission (USITC) finds material injury to the domestic industry, Commerce sets a CVD rate equal to the calculated subsidy margin. Whether specific goods fall within the scope of a measure is determined by their non-preferential origin. Petitions are typically filed by U.S. manufacturers, and CVDs are frequently imposed alongside anti-dumping duties when both forms of unfair trade practice apply to the same product. They are legally distinct from Section 232 measures and reciprocal tariffs, which rest on separate statutory authority.
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