Documents considered by the Committee on 12 January 2011 - European Scrutiny Committee Contents


6 EU anti-dumping, anti-subsidy and safeguard activities

(32151)

COM(10) 558

+ ADD 1

Commission Report on the European Union's anti-dumping, anti-subsidy and safeguard activities 2009

Legal base
Document originated13 October 2010
Deposited in Parliament9 November 2010
DepartmentBusiness, Innovation and Skills
Basis of considerationEM of 18 November 2010
Previous Committee ReportNone
To be discussed in CouncilNo date set
Committee's assessmentPolitically important
Committee's decisionCleared

Background

6.1 Dumping takes place when a product is exported to another country at less than its normal domestic price, and this causes a material injury to an industry in the importing country. In such circumstances, international law allows that country to take anti-dumping measures, and, in particular, Article VI of the 1994 General Agreement on Tariffs and Trade (GATT) sets out detailed rules relating to the calculation of dumping; the procedures for initiating and pursuing an investigation (including the establishment and treatment of facts); the imposition of provisional measures; the imposition and collection of anti-dumping duties; and the duration and review of such measures. Similar procedures apply in the case of subsidised imports.

6.2 These provisions have been enshrined in EU law. In particular, Council Regulation (EC) No 1225/2009 allows the Commission to take provisional measures, with substantive steps being reserved to the Council. Because they are not inter-institutional documents, Commission Regulations are not depositable: and, whilst Commission proposals for Council Regulations are in principle depositable, the extensive background analysis they provide usually contain a great deal of commercially confidential information, and they are therefore not published, and hence subjected to Parliamentary scrutiny until they have been agreed by the Council. Moreover, they are invariably cleared as not being of sufficient legal or political importance to warrant a substantive Report to the House.

6.3 In a normal Parliamentary session, about 30-35 such measures are considered, and typically involve extensions of existing measures; the definitive imposition of measures provisionally introduced by the Commission; steps to prevent measures applicable to one country being circumvented by products being routed via another country; and variations in the level of duty imposed to reflect either changes in the general situation in an exporting country or the circumstances of an individual exporter.

The current document

6.4 After noting that the EU had in force 135 anti-dumping and eight anti-subsidy measures at the end of 2009, affecting 0.6% of total imports, the Commission says that, during the year, 21 new investigations were launched. Ten cases were concluded with the imposition of definitive duties, whilst 11 were concluded without measures: and four measures expired automatically after five years.

6.5 The Commission says that review investigations accounted for a major part of its services concerned with trade defence instruments, and involved a number of headings, as follows:

—  Expiry reviews

The Commission notes that measures expire after five years, unless an expiry review demonstrates that they should be maintained, and that 11 expiry review investigations were initiated in 2009, of which five concluded by confirming that the duty should be maintained for a further five years.

—  Interim reviews

The Regulation provides for measures to be reviewed during their period of validity, and the Commission says that 14 interim reviews were initiated in 2009. Thirteen of these concluded with confirmation or amendment of the duty, and one with the termination of the measure.

—  "Other" interim reviews

The Commission says that two other reviews were initiated, and six concluded, in 2009, arising from actions following court judgements, World Trade Organisation dispute settlement proceedings, and the need to clarify the scope of the measures.

—  New exporter reviews

The Regulation allows reviews to establish an individual dumping margin or countervailing duty for those undertakings which did not export during the investigation period, and, where an exporter can establish that it started to export to the EU after that period, it is generally entitled to a duty lower that the country-wide duty. The Commission says that six new exporter reviews were initiated in 2009.

—  Absorption investigations

Where it appears that, following an investigation and prior to or following the imposition of measures, export prices have decreased or there has been no or insufficient movement in the resale prices or subsequent selling prices of the imported product in the EU, an "absorption" review may be opened to examine whether the measure has had effects on those prices, and that dumping margins may be recalculated and the duty increased. However, it says that there were no such reviews in 2009.

—  Circumvention investigations

The Commission says that the Regulation allows investigations to be re-opened if there is evidence to show that measures are being circumvented, and that one such investigation was initiated in 2009, leading to an extension of duty.

—  Safeguard investigations

The Commission says that there were no such investigations in 2009.

The Government's view

6.6 In his Explanatory Memorandum of 18 November 2010, the Minister for Employment Relations, Consumer and Postal Affairs at the Department for Business, Innovation and Skills (Mr Edward Davey) says that the document relates primarily to the decisions taken by the EU or measures in place against third countries, and has no policy or financial implications.

Conclusion

6.7 Although this is a purely factual report, we regard the Commission's anti-dumping activities as being of some importance. Consequently, although we are content to clear the document, we are drawing it to the attention of the House.





 
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