Dumping – Unfair Trade Practice

Research background: The Globalisation gradually has removed the protection that has existed to protect producers against unfair trade practices. Existence of imperfect competition within an international trade is presented by descending curve of average costs while increasing economies of scale; it often leads some producers not to adjust the price in relation to the marker. In this case, we speak about dumping. Purpose of the article: The article deals with dumping issue – an unfair trade practice analysing EU trade policy including antidumping, related Slovak legislation, price discrimination and dumping model. Methods: From a methodological point of view, the article is divided into four parts; description of trade policy, antidumping and its legislation, price discrimination and dumping model. Methods of synthesis, critical thinking and graphical analysis were used. Findings & Value added: In practice, accounting of different prices to the various consumers is called a price discrimination. The most common type of price discrimination in foreign trade is a dumping. It is a price practice when a company accounts lower price for exported goods compared to the same goods sale at home. World Trade Organization (WTO) allow counter such injury via trade defence instruments (TDIs). The EU TDIs are appropriate to tackle new challenges to international trade, because the Commission had done to modernise the EU’s basic Anti-Dumping (AD) Regulations.

USA - China: bad peace is better than a good “trade war”

Article is dedicated to the trade and economic links of USA and China. The authors tried to find out key features and characteristics of these cooperation. At the same time the authors tried to analyze the logic and the reasons of the trade war that has been escalated by USA against China. It needs to underline that the unfair trade practice of China foreign trade and transfer of technologies led to the American Administration protectionism policy.

Comparative Advertising in India: Need to Strengthen Regulations

With the liberalization and globalization of the Indian economy, firms have been aggressively and vigorously promoting their products and services. In a comparative environment, every representation of a product or service is about what ‘others are not.’ These practices raise questions about truthfulness and fairness of representation of products and services. This paper explores regulations on comparative advertising of products and services in the context of globalization and liberalization in India. The Monopolies and Restrictive Trade Practices (MRTP) Act, 1969, was amended in 1984 to introduce a chapter on unfair trade practices. One of the provisions constitutes any representation which ‘gives false or misleading facts disparaging the goods, services or trade of another person’ to be an unfair trade practice. The MRTP Commission and the Supreme Court have given shape to the provision. Most comparative advertisements refer to rival products as ‘ordinary,’ instead of specifically mentioning names of products. Aggrieved firms have claimed that ‘ordinary’ refers to all products other than the advertised one. The MRTP Commission, however, has maintained that the wording in the law �goods of another person� implies disparagement of an identifiable product of a specific manufacturer. Further, only if the disparagement is based on ‘false and misleading facts’ that the advertisement becomes an unfair trade practice. Establishing facts often requires detailed scientific and technical assessment of the products. Our courts are not equipped to deal with this. As courts can take a long time to settle a dispute, what has become crucial is whether a court would award intermediate injunction or not. This is restraining the party from advertising pending a final decision by the court. In fact, by the time interim injunction is granted, the advertisement may have abready done the damage. The law makes provision for compensating the party for ‘loss of business and profit.’ The courts, however, have found computing losses to be not free from ‘complications and complexities.’ Thus, courts have not been awarding compensation. All these factors together have left the field of comparative advertisement effectively unregulated. The major findings of this study in this context are: The opening up of the economy, on its own, is not going to create and sustain competition. Protection against unfair trade practices has been available under the Consumer Protection Act. Thus, the repeal of the MRTP Act would not be of any significance. Not only the consumers but even the firms need adequate law against unfair trade practices to have some �rules of the game� for competing among themselves. But, within the structure of the Consumer Protection Act, competing firms cannot be �consumers� to approach a consumer forum. The state would need to develop adequate knowledge of the working of businesses in a free economy, enact laws, and create infrastructure and mechanisms for sustaining competition.

Legal Responses to Economic Liberalization: The Case of Unfair Trade Practices

This paper traces the evolution of law and practices in the past 20 years focusing on one aspect of unfair trade practices — unfairness in holding of games, contests, lotteries, and similar schemes for promoting sales and services in the context of India transitioning from a state controlled to a liberalized economy. With competition in the economy, firms have got into aggressive and competitive trade practices to entice the customers. These practices raise questions about the truthfulness and fairness of representation of products, services, advertisements, and schemes and modalities for promotion of products and services. There is a need for adequate law against unfair trade practices and a justice delivery system to have some ‘rules of the game’ to compete among themselves. The Monopolies and Restrictive Trade Practices (MRTP) Act, 1969, was amended in 1984 to introduce a chapter on unfair trade practices. One of the provisions pertained to the holding of games and lotteries. It stated that ‘the conduct of any contest, lottery, game of chance or skill’ for promoting sales, services or business interest was an unfair trade practice and should, therefore, be disallowed. Following the provision, the MRTP Commission had stopped almost all promotion schemes which had an element of draw or lottery. For example, Whirlpool Ltd. had launched a ‘Scratch a Gift Scheme’ and Coca-Cola Ltd. had introduced a promotional scheme for Coke. Considering them to be lottery schemes, the Commission had restrained the companies. The judgement of the Supreme Court in the ‘Horlicks Hidden Wealth Prize Offer’ changed the entire scenario. The Commission considered this scheme to be a kind of lottery and, thus, an unfair trade practice. However, the Supreme Court, in its short judgement in 1998, commented that this was not a case of lottery as there was no draw of lots or that a price was charged for participation in the draw. The fact that some bottles of Horlicks contained a slip of paper which entitled the buyer to a prize is not a lottery in the ordinary sense of the word. Following the judgement, in all the pending cases before the Commission, the parties successfully argued that their schemes did not attract the provision of unfair trade practice as they had not charged extra for participation in the scheme. Ever since, there has been no restraint on holding of such promotion schemes. In this context, the firms would need to do the following: objectively examine if such schemes have any effect on the promotion of products demonstrate the genuineness of a scheme by disclosing vital information work towards formulating appropriate regulations.