In economy, “dumping” occurs in the context of international trade. It occurs when manufacturers export a product to another country at a price lower than the price charged in their home market or below the cost of production. The purpose of the Dumping is usually to increase the market share in a foreign market or drive out the competition.
On the other hand, through the dumping the antidumping was created, a protectionist measure of a country to protect its local production against imports of the same product from third countries where the cost of producing is lower than the cost of manufacturing.
Ultimately, the antidumping aims to prevent the malpractice of selling a product below the normal price, through special taxes on the import of such items and the tariff on the product. In this way, manufacturers that detect items imported into the country at a price below the cost of production can make a complaint to the European Commission to open an investigation.
When we import in China is very important to have all documents regulated and prevent potential fraud with our manufacturers, importers and exporters, since, obviously, many products made in China are below the cost of production in Western countries. However, we must analyze whether this lower price is due to subsidies from the Chinese Government and take into account that if it is not so, we could pay up to 50% of antidumping fee if products are sold below their cost of production.
