21 July 2011
WTO CONFIRMS DECISION AGAINST EU PRACTICES REGARDING NON-MARKET ECONOMIES
WTO Appellate Body issued July 15, 2011 a final ruling overturning the EU’s practice of applying a single country-wide antidumping duty to imports of goods from non-market economy countries like China. The Appellate Body decision means the EU will have to recalculate on a company-specific basis the AD duties it imposes on various imports from China, such as fasteners, footwear, textiles and bicycles.
EU regulations provide that individual AD duty rates for NME exporters will only be established if the exporter can demonstrate that its export activities are sufficiently independent from the state. The Appellate Body agreed with China that this requirement constitutes an “as such” violation of the WTO Antidumping Agreement, which includes no such conditions for individual rates. The decision did acknowledge that “there may be circumstances where exporters and producers from NMEs may be considered as a single entity” when calculating a dumping margin and imposing a duty but said this “cannot be presumed” and “has to be determined by the investigating authorities on the basis of facts and evidence submitted or gathered in the investigation.”
The Appellate Body also found that the EU violated WTO rules by determining that producers accounting for just 27% of EU fastener production constituted a “major proportion” of total domestic production.