Proposal for a Council Regulation amending Council Regulation (EC) No 384/96 on protection against dumped imports from countries not members of the European Community and Council Regulation (EC) No 2026/97 on protection against subsidized imports from countries not members of the European Community
Date: 2003-06-26
Institutions: European Commission
Subjects: anti-dumping duty, dumping, export subsidy, import, market protection, originating product, single market, third country

COMMISSION OF THE EUROPEAN COMMUNITIES

Brussels, 26.6.2003
COM(2003) 380 final

2003/0141 (ACC)

Proposal for a

COUNCIL REGULATION

amending Council Regulation (EC) No 384/96 on protection against dumped imports
from countries not members of the European Community and Council Regulation (EC)
No 2026/97 on protection against subsidized imports from countries not members of the
European Community

(presented by the Commission)

EXPLANATORY MEMORANDUM

There is a clear need to clarify the way decisions are reached between Member States when it
comes  to  the  imposition  of  definitive  anti-dumping  and  anti-subsidy  (countervailing)
measures in the area of trade defence instruments (TDI).

The current situation allows rejecting the Commission proposal in the Council without clearly
taking  a  position,  i.e.  not  having  to  vote  "no"  if  a  Member  State  decides  not  to  follow  the
Commission  proposal.  This  potentially  undermines  the  effectiveness  of  the  TDI  instrument
and should therefore be addressed in a modification of the decision-making system.

The Basic Anti-dumping and Anti-subsidy Regulations (Council Regulations (EC) No 384/96
and 2026/97) already provide for a type of procedure where exactly this problem is addressed:
The procedures for termination of an investigation.

Under  this  procedure,  applied  mutatis  mutandis  to  the  imposition  of  definitive  measures,
Member  States  would  be  consulted  in  the  Advisory  Committee  on  a  draft  regarding  the
imposition  of  definitive  measures.  If  no  objection  is  raised  in  the  Advisory  Committee,  the
definitive measures would be imposed. If an objection is raised, the draft would be forwarded
to  the  Council  and  deemed  to  be  adopted  unless  the  Council  decides  otherwise  by  simple
majority.

This new approach does not upset the balance of responsibilities under the current system, it
tackles surgically the problem at hand by drawing from existing procedures while respecting
the simple majority  principle:  It  ensures  that  an  affirmative position  is  required  by  Member
States to overturn a Commission proposal, not more, not less.

Since  the  decision-making  process  should  be  applied  in  a  consistent  fashion  throughout  the
various steps involved in the application of the anti-dumping and anti-subsidy instrument, this
change should also be applied concerning decisions which follow the same procedure as the
imposition  of  definitive  measures,  i.e.  to  review  or  suspend  measures  and  to  deal  with
absorption and circumvention of anti-dumping and countervailing measures.

It is therefore proposed that the Council adopt the attached proposal for a Council Regulation
which should be published in the Official Journal of the European Union.

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2003/0141 (ACC)

Proposal for a

COUNCIL REGULATION

amending Council Regulation (EC) No 384/96 on protection against dumped imports
from countries not members of the European Community and Council Regulation (EC)
No 2026/97 on protection against subsidized imports from countries not members of the
European Community

THE COUNCIL OF THE EUROPEAN UNION,

Having  regard  to  the  Treaty  establishing  the  European  Community,  and  in  particular
Article 133 thereof,

Having regard to the proposal from the Commission1,

Whereas:

(1)

(2)

(3)

(4)

1

2

3

By  Regulation  (EC)  No  384/962  and  Regulation  (EC)  No  2026/973  the  Council
adopted  common  rules  for  protection  against  dumped,  and,  respectively,  subsidised
imports  from  countries  which  are  not  members  of  the  European  Communities  (the
'Basic Regulations').

The  Basic  Regulations  foresee,  for  the  imposition  of  definitive  anti-dumping  and
countervailing  measures,  a  procedure  under  which  the  Council,  acting  by  simple
majority on a proposal by the Commission, imposes definitive measures.

In  the  light  of  recent  experience  of  the  application  of  the  Basic  Regulations  and  in
order to preserve the transparency and efficiency of the trade defense instruments, it is
considered  necessary to revisit the way  Community  institutions  work  together  in  the
process of the imposition of definitive anti-dumping and countervailing measures.

Under the current approach, a Commission proposal will only be adopted if a simple
majority of Member States votes in favour of such a proposal. This has the effect that
abstentions count effectively against the Commission proposal. This in turn can result
in  a  situation  where  a  Commission  proposal  will  not  be  adopted  by  the  Council
because the necessary quorum is not reached although the number of Member States
voting  in  favour  of  the  Commission  proposal  is  higher  than  the  number  of  Member
States voting explicitly against.

OJ C …, …, p. …
OJ  L 56,  6.3.1996,  p.  1.  Regulation  last  amended  by  Regulation  (EC)  No  1972/2002  (OJ  L  305,
7.11.2002, p. 1).
OJ  L  288,  21.10.1997,  p.  1.  Regulation  last  amended  by  Regulation  (EC)  No  1973/2002  (OJ  L  305,
7.11.2002, p. 4).

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(5)

(6)

(7)

The  Basic  Regulations  already  foresee  procedures  where  this  problem  is  effectively
addressed, in particular in the procedures leading to the termination of investigations
or the acceptance of undertakings, where the Commission consults Member States on
a  draft  in  the  Advisory  Committee.  When  no  objection  is  raised,  the  Commission
adopts  the  relevant  measures.  If  an  objection  is  raised,  the  draft  is  forwarded  to  the
Council,  together  with  a  report  of  the  consultations,  and  is  deemed  to  be  adopted
unless the Council decides otherwise.

It  is  expedient  to  apply  such  a  procedure  also  for  the  imposition  of  definitive  anti-
dumping and countervailing measures in order to streamline the Community's decision
making  process  without  changing  the  institutional  balance  between  the  Commission
and the Council in the application of the Basic Regulations.

For  reasons  of  consistent  application  of  decisionmaking  procedures  under  the  Basic
Regulations,  the  procedures  for  certain  steps  which  foresee  essentially  the  same
procedure  as  the  imposition  of  definitive  measures  should  be  aligned  as  well.
Accordingly, the above approach should be adopted also for the procedures regarding
reviews, reinvestigation, circumvention and suspension of measures,

HAS ADOPTED THIS REGULATION:

Article 1

Regulation (EC) No 384/96 is hereby amended as follows:

1.

Article 9 paragraph 4 shall be replaced by the following:

"4.  Where  the  facts  as  finally  established  show  that  there  is  dumping  and  injury
caused thereby, and the Community interest calls for intervention in accordance with
Article 21, a definitive anti-dumping duty shall be imposed, after consultation, by the
Commission  provided  that  there  is  no  objection  raised  within  the  Advisory
Committee. In all other cases, the Commission shall submit to the Council forthwith
a  report  on  the  results  of  the  consultation,  together  with  a  draft  regarding  the
imposition of a definitive anti-dumping duty. The definitive anti-dumping duty shall
be  deemed  to  be  imposed  by  the  Commission  if,  within  one  month,  the  Council,
acting by a simple majority, has not decided otherwise. Where provisional duties are
in  force,  a  draft  regarding  definitive  action  shall  be  submitted  not  later  than  one
month before the  expiry of such duties. The amount of the anti-dumping duty shall
not exceed the margin of dumping established but it should be less than the margin if
such lesser duty would be adequate to remove the injury to the Community industry."

2.

Article 11 paragraph 6 shall be replaced by the following:

"6.  Reviews  pursuant  to  this  Article  shall  be  initiated  by  the  Commission  after
consultation  of  the  Advisory  Committee.  Where  warranted  by  reviews,  measures
shall be repealed or maintained pursuant to paragraph 2, or repealed, maintained or
amended  pursuant  to  paragraphs  3  and  4,  after  consultation,  by  the  Commission
provided that there is no objection raised within the Advisory Committee. In all other
cases, the Commission shall submit to the Council forthwith a report on the results of
the consultation, together with a draft regarding repealing, maintaining or amending
the measures. The measures shall be deemed to be repealed, maintained or amended
by the Commission if, within one month, the Council,  acting by a simple  majority,

4

has not decided otherwise. Where measures are repealed for individual exporters, but
not for the country as a whole, such exporters shall remain subject to the proceeding
and  may,  automatically,  be  reinvestigated  in  any  subsequent  review  carried  out  for
that country pursuant to this Article."

3.

Article 12 paragraph 3 shall be replaced by the following:

"3.  Where  a  reinvestigation  pursuant  to  this  Article  shows  increased  dumping,  the
measures  in  force  shall,  after  consultation,  be  amended  by  the  Commission  in
accordance  with  the  new  findings  on  export  prices,  provided  that  there  is  no
objection raised within the Advisory Committee. In all other cases, the Commission
shall  submit  to  the  Council  forthwith  a  report  on  the  results  of  the  consultation,
together  with  a  draft  regarding  the  amendment  of  the  measures  in  force.  The
amendment shall be deemed to be imposed by the Commission if, within one month,
the Council, acting by a simple majority, has not decided otherwise."

4.

Article 13 paragraph 3 shall be replaced by the following:

"3. Investigations shall be initiated pursuant to this Article where the request contains
sufficient  evidence  regarding  the  factors  set  out  in  paragraph  1.  Initiations  shall  be
made,  after  consultation  of  the  Advisory  Committee,  by  Commission  Regulation
which  shall  also  instruct  the  customs  authorities  to  make  imports  subject  to
registration in accordance with Article 14(5) or to request guarantees. Investigations
shall  be  carried  out  by  the  Commission,  which  may  be  assisted  by  customs
authorities  and  shall  be  concluded  within  nine  months.  When  the  facts  as  finally
ascertained justify  the extension  of  measures, this  shall  be  done,  after  consultation,
by  the  Commission  provided  that  there  is  no  objection  raised  within  the  Advisory
Committee. In all other cases, the Commission shall submit to the Council forthwith
a  report  on  the  results  of  the  consultation,  together  with  a  draft  regarding  the
extension  of  measures.  The  extension  shall  be  deemed  to  be  imposed  by  the
Commission if, within one month, the Council, acting by a simple majority, has not
decided  otherwise.  The  extension  shall  take  effect  from  the  date  on  which
registration  was  imposed  pursuant  to  Article  14(5)  or  on  which  guarantees  were
requested.  The  relevant  procedural  provisions  of  this  Regulation  with  regard  to
initiations and the conduct of investigations shall apply pursuant to this Article."

5.

Article 14 paragraph 4 shall be replaced by the following:

"4.  In the  Community  interest,  measures  imposed  pursuant  to  this  Regulation  may,
after  consultation  of  the  Advisory  Committee,  be  suspended  by  a  decision  of  the
Commission  for  a  period  of  nine  months.  The  suspension  may  be  extended  for  a
further  period,  not  exceeding  one  year,  after  consultation,  by  the  Commission
provided that there is no objection raised within the Advisory Committee. In all other
cases, the Commission shall submit to the Council forthwith a report on the results of
the  consultation,  together  with  a  draft  regarding  the  further  extension  of  the
suspension of measures. The further extension shall be deemed to be imposed by the
Commission if, within one month, the Council, acting by a simple majority, has not
decided otherwise. Measures may only be suspended where market conditions have
temporarily changed to an extent that injury would be unlikely to resume as a result
of  the  suspension,  and  provided  that  the  Community  industry  has  been  given  an
opportunity to comment and these comments have been taken into account. Measures

5

may, at any time and after consultation, be reinstated if the reason for suspension is
no longer applicable."

Article 2

Regulation (EC) No 2026/97 is hereby amended as follows:

1.

Article 15 paragraph 1 shall be replaced by the following:

"1.  Where  the  facts  as  finally  established  show  the  existence  of  countervailable
subsidies  and  injury  caused  thereby,  and  the  Community  interest  calls  for
intervention in accordance with Article 31, a definitive countervailing duty shall be
imposed,  after consultation, by  the  Commission  provided  that  there  is  no  objection
raised  within  the  Advisory  Committee.  In  all  other  cases,  the  Commission  shall
submit to the Council forthwith  a report on the results of the consultation, together
with  a  draft  regarding  the  imposition  of  a  definitive  countervailing  duty.  The
definitive countervailing duty shall be deemed to be imposed by the Commission if,
within  one  month,  the  Council,  acting  by  a  simple  majority,  has  not  decided
otherwise. Where provisional duties are in  force,  a draft  regarding definitive  action
shall  be  submitted  not  later  than  one  month  before  the  expiry  of  such  duties.  No
measures shall be imposed if the subsidy or subsidies are  withdrawn or it has  been
demonstrated  that  the  subsidies  no  longer  confer  any  benefit  on  the  exporters
involved.  The  amount  of  the  countervailing  duty  shall  not  exceed  the  amount  of
countervailable  subsidies  established  but  it  should  be  less  than  the  total  amount  of
countervailable subsidies if such lesser duty would be adequate to remove the injury
to the Community industry."

2.

Article 22 paragraph 2 shall be replaced by the following:

"2. Reviews pursuant to Articles 18, 19 and 20 shall be initiated by the Commission
after  consultation  of  the  Advisory  Committee.  Where  warranted  by  reviews,
measures  shall  be  repealed  or  maintained  pursuant  to  Article  18,  or  repealed,
maintained  or  amended  pursuant  to  Articles  19  and  20,  after  consultation,  by  the
Commission  provided  that  there  is  no  objection  raised  within  the  Advisory
Committee. In all other cases, the Commission shall submit to the Council forthwith
a report on the results of the consultation, together with a draft regarding repealing,
maintaining  or  amending  the  measures.  The  measures  shall  be  deemed  to  be
repealed,  maintained  or  amended  by  the  Commission  if,  within  one  month,  the
Council, acting by a simple majority, has not decided otherwise. Where measures are
repealed for individual exporters, but not for the country as a whole, such exporters
shall remain subject to the proceeding and may be reinvestigated in any subsequent
review carried out for that country pursuant to this Article."

3.

Article 23 paragraph 2 shall be replaced by the following:

"2. Investigations shall be initiated pursuant to this Article where the request contains
sufficient  evidence  regarding  the  factors  set  out  in  paragraph  1.  Initiations  shall  be
made,  after  consultation  of  the  Advisory  Committee,  by  Commission  Regulation
which  shall  also  instruct  the  customs  authorities  to  make  imports  subject  to
registration in accordance with Article 24 (5) or to request guarantees. Investigations
shall  be  carried  out  by  the  Commission,  which  may  be  assisted  by  customs

6

authorities  and  shall  be  concluded  within  nine  months.  When  the  facts  as  finally
ascertained justify  the extension  of  measures, this  shall  be  done,  after  consultation,
by  the  Commission  provided  that  there  is  no  objection  raised  within  the  Advisory
Committee. In all other cases, the Commission shall submit to the Council forthwith
a  report  on  the  results  of  the  consultation,  together  with  a  draft  regarding  the
extension  of  measures.  The  extension  shall  be  deemed  to  be  imposed  by  the
Commission if, within one month, the Council, acting by a simple majority, has not
decided  otherwise.  The  extension  shall  take  effect  from  the  date  on  which
registration  was  imposed  pursuant  to  Article  24(5)  or  on  which  guarantees  were
requested.  The  relevant  procedural  provisions  of  this  Regulation  with  regard  to
initiations and the conduct of investigations shall apply pursuant to this Article."

4.

Article 24 paragraph 4 shall be replaced by the following:

"4.  In the  Community  interest,  measures  imposed  pursuant  to  this  Regulation  may,
after  consultation  of  the  Advisory  Committee,  be  suspended  by  a  decision  of  the
Commission  for  a  period  of  nine  months.  The  suspension  may  be  extended  for  a
further  period,  not  exceeding  one  year,  after  consultation,  by  the  Commission
provided that there is no objection raised within the Advisory Committee. In all other
cases, the Commission shall submit to the Council forthwith a report on the results of
the  consultation,  together  with  a  draft  regarding  the  further  extension  of  the
suspension of measures. The further extension shall be deemed to be imposed by the
Commission if, within one month, the Council, acting by a simple majority, has not
decided otherwise. Measures may only be suspended where market conditions have
temporarily changed to an extent that injury would be unlikely to resume as a result
of  the  suspension,  and  provided  that  the  Community  industry  has  been  given  an
opportunity to comment and these comments have been taken into account. Measures
may, at any time and after consultation, be reinstated if the reason for suspension is
no longer applicable."

Article 3

This  Regulation  shall  enter  into  force  on  the  7th  day  following  that  of  its  publication  in  the
Official Journal of the European Union.

It  shall  apply  to  all  investigations  initiated  pursuant  to  Regulation  (EC)  No  384/96  and
Regulation (EC) No 2026/97, including pending investigations.

This Regulation shall be binding in its entirety and directly applicable in all Member States.

Done at Brussels,

For the Council
The President

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