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EU Parliamentarians Want Tougher AD/CV Duties on Imports

Friday, February 14, 2014
Sandler, Travis & Rosenberg Trade Report

A plan to modernize and strengthen the European Union’s trade defense measures could be delayed after members of the European Parliament moved to toughen a European Commission proposal by, among other things, allowing for higher antidumping and countervailing duties in certain cases. MEPs will now enter into legislative negotiations with the European Council with the aim of reaching an agreement within the next few months.

The Commission’s proposal would allow the Commission to self-initiate AD and CV duty investigations without an official complaint by EU industry to counter the risk of foreign country retaliation against companies that might request such action. The Commission would also be able to deviate from the “lesser duty rule,” under which AD and CV duties are set at levels sufficient to remove the injury caused to EU industry, to allow the imposition of duties equal to the margin of dumping or subsidization (which are generally higher). Importers and downstream users of products covered by trade defense measures would be informed of any provisional AD or CV duties two weeks before they are imposed, and importers would be offered refunds of duties collected during an expiry review if that review finds no justification to continue the AD/CV measure at issue.

MEPs voted this week to recommend the following changes to the Commission’s proposal.

- For sectors largely made up of small and medium-sized enterprises, it should be possible to impose higher duties on imports of dumped or subsidized goods. A help desk should be created to help SMEs file AD and CV complaints and navigate investigation proceedings and, possibly, assist business sectors consisting largely of SMEs with assembling the initial evidence of economic injury needed to justify launching an AD investigation.

- EU importers and exporting third countries should not receive two weeks’ notice of plans to impose provisional AD or CV duties. While this proposal is intended to ensure that goods already en route are not unfairly subject to duties, MEPs expressed concern that it could encourage the stockpiling of dumped or subsidized goods.

- Higher AD or CV duties should be allowed if the exporting third country does not have a sufficient level of social and environmental standards, judged on the basis of environmental and labor rights conventions. At the same time, the EU should impose more moderate duties (by applying the lesser duty rule) when the imports come from a least-developed country wishing to

pursue its legitimate development goals.

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