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<nettime> GATT on dumping and loss-leading business
RTmark on 28 Mar 2001 10:42:45 -0000


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<nettime> GATT on dumping and loss-leading business


From: Générée Eleutherium <tellme {AT} gatt.org>
To: "Juan C Montenegro" <juanka007 {AT} juno.com>
Subject: Re: Question: Untitled

Well, you see, there is what we call a *selective illegality* to this behavior.
It is routine for fast food or merchandising franchises to eviscerate local
businesses while operating at a loss until those businesses are gone: Wal-Mart,
Starbucks, McDonalds, the list goes on and on and on. This dumping is tolerated
because it is known that a free, unregulated market leads to increased benefit
for all, except under very limited conditions the residents of areas that have
been targeted by especially energetic entities. Besides that, the higher rate
of growth of the economies of nations that tolerate such behavior is enough to
convince anyone that such behavior is beneficial and should not only be
tolerated, it should be encouraged.

Best,
Générée

http://www.gatt.org/
The World Trade Organization: Making the World Safe For Effectiveness.

You wrote:
>thank you so much for your prompt response.  I was under the impression
>that this behavior was illegal since the outcome can be catastrophic for
>domestic businesses.  If I understand correctly, the WTO would not
>interfere unless there were human lives at stake.  
>thanks again for taking the time to reply.   I'm just beginning to get my
>feet wet in the world of international business and so far I'm fascinated
>by it.  
>
>On Tue, 27 Mar 2001 10:58:22 -0500 Générée Eleutherium <tellme {AT} gatt.org>
>writes:
>> Dear Dumper,
>> 
>> Thank you for concerning yourself.
>> 
>> First of all, you have a misunderstanding: dumping is done by
>> corporations, who have a product and wish to eviscerate others in 
>> the
>> field by lowering prices to a level uncompetitible, for a
>> period of time, until the competition disappears or is
>> otherwise vanished. Often, governments will agree.
>> 
>> This is, contrary to misconception, not generally punishable. In 
>> other
>> words, we are not generally concerned with dumping behaviors. The
>> removal of "small" competitors from markets through abnormal price
>> reduction (with, generally, accompanying quality reduction not
>> translatable to the consumer's awareness) is routinely accomplished 
>> by
>> such pillars as fast-food franchises, parts-machining conglomerates,
>> automobile producers. Where people are not protected from resulting
>> diseases and other catastrophes, resulting diseases and other
>> catastrophes will indeed result.
>> 
>> So it is with dumping in general.
>> 
>> Thank you,
>> Générée Eleutherium
>> 
>> http://www.gatt.org/
>> The World Trade Organization: Making the World Safe For 
>> Effectiveness.
>> 
>> You wrote:
>> >I'm interested in finding a little more about the antidumping laws, 
>> in
>> >particular how you punish those braking this law. I have searched 
>> your
>> >web site but didn't find anything about governments that have 
>> broken
>> >this law and how they were punished by the WTO.
>> >
>> >Thanks

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