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1 correction found
Dumping is when you sell a product at significantly below cost in order to corner market share.
This is not the legal definition of dumping. Under WTO and U.S. trade rules, dumping means selling exports at less than 'normal value' or 'less than fair value'—typically below the home-market price, and sometimes below cost—not selling below cost with an intent to corner market share.
Full reasoning
The post gives a definition closer to predatory pricing than to the trade-law concept of dumping.
Official WTO rules define dumping as introducing a product into another country at less than its normal value—specifically, when the export price is lower than the comparable price in the exporter’s home market. The WTO text then explains that when home-market sales do not permit a proper comparison, authorities may use a third-country price or cost of production plus amounts for expenses and profit. In other words, selling "significantly below cost" is not the core definition, and intent to "corner market share" is not part of the definition at all.
The U.S. Department of Commerce likewise says dumping occurs when a foreign producer sells in the United States at a price below its home-market price, or below cost of production. That is a pricing comparison standard, not a requirement to prove a plan to seize market share.
So this sentence is incorrect because it substitutes a different concept—below-cost pricing with exclusionary intent—for the actual trade-law definition of dumping.
2 sources
- WTO | legal texts - Marrakesh Agreement
For the purpose of this Agreement, a product is to be considered as being dumped ... if the export price of the product exported from one country to another is less than the comparable price ... for the like product when destined for consumption in the exporting country.
- An Introduction to U.S. Trade Remedies
Dumping occurs when a foreign producer sells a product in the United States at a price that is below that producer's sales price in the country of origin ('home market'), or at a price that is lower than the cost of production.