WRITTEN QUESTION E-0076/03 by Daniel Varela Suanzes-Carpegna (PPE-DE) to the Commission. Situation of the EU shipbuilding sector and unfair competition from South Korea.
Date: 2003-01-23
Institutions: European Parliament, Provisional data
Subjects: South Korea, World Trade Organisation, market protection, restriction on competition, shipbuilding, trade dispute

C 11 E/64

Official Journal of the European Union

EN

15.1.2004

Answer given by Mr Bolkestein on behalf of the Commission

(25 February 2003)

The principle of free movement of goods, which is a corner-stone of the Internal Market, entails that
private individuals should be allowed the unimpeded transfer of duty-paid tobacco products from one
Member State to another.

Nevertheless, situations can be envisaged in which the authorities of a Member State may be justified to
interfere with the movement of goods, e.g. in cases involving potential tax fraud or other irregularities.
However, the compatibility of such measures with the principles of the Community Law has to be assessed
in the light of the circumstances of each particular case.

The Commission is investigating complaints concerning the seizure in Spain of tobacco from outbound
travellers. When these enquiries are complete, the Honourable Member will of course be informed of the
outcome.

(2004/C 11 E/068)

WRITTEN QUESTION E-0076/03

by Daniel Varela Suanzes-Carpegna (PPE-DE) to the Commission

(23 January 2003)

Subject: Situation of the EU shipbuilding sector and unfair competition from South Korea

Following South Korea’s failure to meet its obligations vis-à-vis the EU arising from the ‘agreed minutes’
signed on 22 June 2000 and given that an amicable settlement could not be reached by 30 September
2002, the Commission has had to resort to a dispute settlement procedure at the WTO. During the
Spanish presidency, a temporary defence mechanism was adopted for the EU shipbuilding industry
(Regulation (EC) 1177/2002 (1) of 27 June 2002), which will apply for the duration of
the WTO
procedure. This regulation (cid:1) and, therefore, the mechanism set up by it (cid:1) will remain in force until
31 March 2004. The Commission has recently presented its Sixth Report on shipbuilding in the world, in
which it once more stresses (cid:1) as in the five previous reports (cid:1) the problem of unfair competition from
South Korea and its damaging effects on the EU shipbuilding sector.

1.
Does the Commission consider the proposed period of validity of this defence mechanism to be
in the light of the likely duration of the dispute settlement procedure at the WTO, the
sufficient,
persistence of South Korea’s unfair competitive practices, and the longer recovery period needed by the
affected parts of the shipbuilding sector?

In the context of its obligation to undertake monitoring and regular revision of the situation of the
2.
various specific segments of the market (Regulation 1177/2002, Article 2(5)), is the Commission carrying
out, or does it intend soon to carry out, an analysis of other market segments which could be, or already
are, affected by South Korea’s persistent unfair competitive practices, and which could therefore become
the above-mentioned temporary defence mechanism (or a similar
eligible for
mechanism), as is implied in its Sixth Report on shipbuilding in the world?

the provisions of

3.
Can the Commission state what action, whether directly or via the IMF, it intends to take with a view
to ensuring the monitoring and evaluation of a possible full-scale restructuring of the South Korean
shipyards, in order to prevent any further instance of exclusive assistance being granted by the South
Korea authorities on lines similar to those which have brought about the existing unfair competitive
practices?

(1) OJ L 172, 2.7.2002, p. 1.

15.1.2004

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Official Journal of the European Union

C 11 E/65

Answer given by Mr Lamy on behalf of the Commission

(21 March 2003)

1.
The Temporary Defensive Mechanism (TDM) is an exceptional measure, designed to support WTO
action against Korea. It is limited in scope and time. The Commission has explained on many occasions
that its scope is intentionally narrow and focuses only on those market segments where it has been clearly
demonstrated, in the Trade Barriers Regulation (1) (TBR) Report, over a reasonable period of time, that
Korean practices are causing the most severe adverse effects on Community industry. The Regulation
expires on 31 March 2004, which takes into account the time necessary for the completion of the WTO
procedure.

The Commission will continue to monitor the market and, in particular, the sectors of container
2.
ships, product and chemical tankers, and liquefied Natural Gas (LNG) carriers. The Commission will
continue to reflect on its position in light of this monitoring. However, in view of the exceptional nature
of the TDM, the possibility of granting aid to LNG carriers in particular is subject to confirmation, by the
Commission on the basis of a new investigation under the TBR covering the year 2002.

As regards the further investigations covering 2002, the Commission launched a TBR questionnaire to the
industry in December 2002. On the basis of their replies, the Commission expects to present the result of
this further investigation no later than March 2003.

3.
The Commission is closely monitoring the developments of the world shipbuilding market (especially
as far as the Korean yards are concerned) and reports annually to the Council. Such monitoring covers not
only movements in prices and market shares but also financing aspects such as restructuring operations
financed by state resources. It should be noted, however, that the International Monetary Fund (IMF) has
no mandate to become involved in possible Korean shipyard restructuring operations.

(1) Council Regulation (EC) No 3286/94 of 22 December 1994 laying down Community procedures in the field of the
common commercial policy in order to ensure the exercise of the Community’s rights under international trade
rules, in particular those established under the auspices of the World Trade Organisation, OJ L 349, 31.12.1994.

(2004/C 11 E/069)

WRITTEN QUESTION E-0078/03

by Raimon Obiols i Germà (PSE) to the Commission

(23 January 2003)

Subject: Relocation of enterprises to central and eastern Europe

At a time when the EU is close to completing the negotiations for the accession of the applicant countries,
enterprises located in the Member States are relocating to certain central and eastern European countries,
attracted not only by low wage levels but also by the considerable tax advantages offered to business by
certain countries.

These relocations are likely to result in higher unemployment levels in the Member States, and may also
undermine public support for EU enlargement, given the lack of information and transparency on the
subject of tax exemptions which has characterised the negotiation process.

Can the Commission indicate how many exemptions, and what type of exemptions, it has proposed for
the car industry in the various negotiation processes for the forthcoming enlargement?