On 4 December 2017, the Council of the European Union (“Council of the EU”) approved a new Regulation amending the current EU antidumping and anti-subsidy rules (Regulation (EU) 2016/1036 and Regulation (EU) 2016/1037 respectively), after the European Parliament (“Parliament”) approved the new rules on 15 November this year. The new Regulation was a response to the expiry of parts of China’s WTO accession protocol in December 2016. The adoption of these measures was provoked by unfair trade practices from third countries consisting in an export flood to the EU of products at or below cost price. The new legislation aims to preserve the European industry and to prevent the loss of hundred of thousands of jobs in the EU.
The new legislation introduces a new methodology for determining dumping margins for imports from third countries. Currently, the Commission bases its approach on a distinction between market economies and non-market economies. The new rules provide for an assessment based on the distinction between WTO members and non-WTO members. This new approach applies to situations where the imported items reach a price substantially different from the price that would be achieved under conditions of competition. The new rules also refer to cases of considerable state interference in economy (e.g. in cases of state-owned or state-controlled companies). The Commission will continue to apply its current method with regard to non-WTO countries.
Under the new Regulation the Commission shall publish reports on specific situations in certain countries based on these criteria. The Regulation provides further that the Commission must prove the existence of dumping or other unfair practices.
The Commission will further consider other aspects, such as the exporting country’s compliance with international labor, fiscal and environmental international standards and potential discriminatory measures against foreign investments.
The new framework would only apply to antidumping investigations initiated upon entry into force of the amended provisions. Ongoing antidumping investigations fall under the scope of the current antidumping Regulation.
The text of the Regulation will be signed in Strasbourg by the Presidents and the Secretaries-General of the Parliament and the Council of the EU on 13 December 2017. The Regulation will be published in the Official Journal of the European Union on 19 December 2017 and will enter into force on the next day.