REPORT FROM THE COMMISSION TO   THE EUROPEAN PARLIAMENT 28th annual report on the European Union's anti-dumping, anti-subsidy and safeguard activities   (2009)   SEC(2010) 1194
Date: 2010-10-13
Institutions: European Commission
Subjects: activity report, anti-dumping legislation, anti-subsidy proceeding, protective clause

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EUROPEAN COMMISSION  

Brussels, 13.10.2010 
COM(2010) 558 final 

REPORT FROM THE COMMISSION TO  

THE EUROPEAN PARLIAMENT 

28th annual report on the European Union's anti-dumping, anti-subsidy and safeguard 
activities  

(2009) 

SEC(2010) 1194 

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REPORT FROM THE COMMISSION TO  

THE EUROPEAN PARLIAMENT 

28th annual report on the European Union's anti-dumping, anti-subsidy and safeguard 
activities 

(2009) 

INTRODUCTION 

This  2009  report  is  submitted  to  the  European  Parliament  following  its  resolution  of  16 
December  1981  on  the  European  Union's  anti-dumping  activities,  and  the  report  of  its 
Committee on industry, external trade, research and energy.  

This short report provides an overview of the highlights during 2009 and is supplemented, as 
in  previous  years,  by  a  more  detailed  Commission  Staff  Working  Document,  together  with 
detailed  annexes.  This  report  follows  the  same  general  structure  of  the  Working  Document, 
including all its headings, for easy reference to more comprehensive information. 

The present report and the full Working Document are also available to the public at 
http://ec.europa.eu/trade/issues/respectrules/anti_dumping/legis/index_en.htm 

1. 

OVERVIEW OF THE LEGISLATION 

Anti-dumping  (AD),  anti-subsidy  (AS)  and  safeguard  (SFG)  investigations  are 
conducted  on  the  basis  of  basic  Council  Regulations.  An  overview  of  the  existing 
legislation  is  given  in  the  Working  Document.  The  basic  AD  and  AS  texts  will 
hereafter be referred to as the "basic Regulation(s)".  

2. 

BASIC CONCEPTS 

Heading  2  in  the  working  document  gives  an  overview  of  the  terminology  and 
procedures used in TDI investigations. 

3. 

TDI REVIEW– REFLECTION TIME COMMENCED 

The  TDI  review,  which  was  launched  in  2006  ("Green  Paper  process"),  is  still  on 
hold  due  to  a  clear  lack  of  consensus  among  Member  States  and  the  European 
Parliament.  Nevertheless  the  EU  still  considers  that  a  periodic  review  can  help  to 
ensure that the EU's trade defence instruments remain effective in response to unfair 
trading practises. The Commission's intention is to revisit the question of whether our 
instruments can be further refined. In this context the Trade Commissioner stated at 
the 2009 hearing at the European Parliament that the Commission is open to a debate 
on this issue, but that certain conditions should be fulfilled before launching such a 
process.  One  important  element  would  be  to  await  the  results  of  the  WTO  Doha 
Development Agenda negotiations on TDI. This view is shared by most stakeholders.  

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In  the  meantime  around  mid  2009  after  an  intensive,  wide  ranging  consultation 
phase,  the  Commission  agreed  with  Member  States  ways  in  which  transparency  in 
trade defence investigations could be improved. The measures proposed (e.g. revamp 
of  TDI  website;  specific  assistance  for  SMEs;  improved  disclosure  etc)  can  be 
carried out without any legislative changes and full implementation is expected to be 
concluded in 2010. 

4. 

COUNTRY-WIDE MARKET ECONOMY STATUS (MES) 

For  the  purposes  of  anti-dumping  investigations  a  country  can  be  considered  a  full 
market economy  if it fulfils  five criteria which are set  out  in detail  in  the Working 
document attached to this report.  

During  2009  the  Commission  services  continued  to  evaluate  requests  for  country-
wide  MES  from  China,  Vietnam,  Armenia,  Kazakhstan  and  Mongolia.  All  five 
countries  continued  to  provide  additional  information  in  support  of  their  claims 
throughout the year and their requests are at various stages of progress. In May 2009 
the  authorities  of  the  Republic  of  Belarus  addressed  an  official  request  to  the 
Commission  to  be  granted  market  economy  status.  The  Commission  will  start 
analysing their request once completed documentation has been submitted.  

In  addition  to  a  number  of  bilateral  meetings  with  the  countries  concerned,  the  9th 
MES Working Group China met in Brussels in July 2009 in a good and constructive 
atmosphere.  The  Commission's  proposal  to  launch  a  study  on  the  accounting 
practices  in  China  was  finally  agreed  by  China  in  autumn  2009.  The  Commission 
published the relevant tender document at the end of 2009. The result of that study 
will be available at the end of 2010. In second half of 2009 the Commission started 
working  on  a  further  preliminary  MES  China  assessment  report  which  is  now 
expected early 2010.  

In  April  2009  the  COM  repeated  its  readiness  to  conduct  a  further  on  spot 
the 
to  Mongolia.  Mongolia 
verification  mission 
Commission's proposal and discussions on the arrangements commenced.  

responded  positively  on 

In  August  2009  the  Commission  addressed  further  questions  to  the  Government  of 
Kazakhstan concerning recent developments in legislation that may impact on costs 
and prices for the purpose of anti-dumping investigations.  

The  first  assessment  report  on  Armenia's  MES  request  was  completed  by  the 
Commission services in 2009 and was transmitted to the Council in December 2009. 
The report concluded that Armenia had made good progress in certain areas fulfilling 
two of the five criteria for MES.  

The second Vietnam assessment report was near completion in late 2009. 

5. 

TRADE DEFENCE INSTRUMENTS – RAW MATERIAL STRATEGY 

TDI provides certain tools to address some consequences of distortions in the supply 
of raw materials in line with the overall Commission's trade policy on raw materials. 
In 2009 definitive anti-dumping measures were imposed on fasteners originating in 
China.  In  the  context  of  this  investigation  five  Chinese  companies  selected  in  the 
sample  had  requested  Market  economy  treatment.  However  all  five  were  denied 

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MET  on  the  grounds  that  the  costs  of  the  major  input,  steel  wire  rod,  did  not 
substantially  reflect  market  values,  as  required  by  Article  2(7)(c)  of  the  basic 
Regulation. This was the first case where MET was refused on these grounds.  

The existence of such distortions is also taken into account when assessing claims for 
Market Economy Status (MES) by non-market economies. In this context the role of 
the country concerned is examined vis-à-vis their interference in the market and any 
policies which result in distorted prices of raw materials.  

6. 

INFORMATION AND COMMUNICATION ACTIVITIES/ BILATERAL CONTACTS  

6.1. 

Small and medium sized enterprises (SMEs) 

The Commission recognises the important role that SMEs have in the EU's economy. 
The  Commission  is  also  aware  of  the  fact  that  SME's  involved  either  as  Union 
producers,  importers  or  users  in  trade  defence  investigations  initiated  by  the 
Commission  or  as  exporters  in  investigations  initiated  by  third  countries  find  it 
difficult to participate in such investigations.  

The Trade Defence Helpdesk for SMEs was set up in view of the complexity of TDI 
their 
proceedings,  especially  for  SME's,  because  of 
fragmentation. Its role is to address specific SME questions and problems regarding 
TDIs,  both  of  a  general  nature  or  case-specific.  A  part  of  the  TDI  website  is 
dedicated to SMEs, and refers to the Trade Defence Helpdesk contact points. During 
2009  this  website  was  completely  revised,  making  it  more  accessible  and  user-
friendly, especially for SMEs. 

their  small  size  and 

In 2009 these contact points received many requests for information, which were all 
immediately addressed. These requests concerned both the procedures and content of 
TDI proceedings. 

At the end of 2009, the Commission launched a study to identify the needs of SMEs 
in  the  27  EU  Member  States  when  submitting  a  complaint  or  participating  in  trade 
defence investigations as an importer or as a user. The outcome of the study should 
also include specific proposals on how the Commission could better assist SMEs in 
all areas of such investigations.  

A  contractor  is  selected  and  the  final  study  report  will  be  ready  at  the  last  quarter 
2010.  

6.2. 

Bilateral contacts/information activities – industry and third countries 

A seminar on trade defence for officials from third countries had been scheduled to 
take place in 2009 but had to be deferred to 2010. However there were a number of 
bilateral contacts dedicated to discussing various trade defence related topics with a 
number of third countries including China, Korea and Ukraine held in 2009.  

There were also several meetings with key stakeholder associations and companies in 
2009, including a number of events with Business Europe (namely a general meeting 
with all the most relevant members of the association and several bilateral meetings 
with  Business  Europe's  Committee  on  Trade  Policy),  as  well  as  a  one-day  seminar 
with the most relevant associations of importers and distributors in April 2009.  

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7. 

HEARING OFFICER 

2009 was the second full year of activity for the Hearing Officer for DG Trade, who 
became operational in April 2007. The Hearing Officer is administratively attached 
to  the  Director  General  of  DG  Trade  but  acts  independently.  He  reports  to  the 
Director General.  

The  main  task  of  the  Hearing  Officer  is  to  guarantee  the  full  exercise  of  rights  of 
defence in trade proceedings before the European Commission. The Hearing Officer 
also advises the Director General of DG Trade on issues related to due process and 
on any issues arising out of trade proceedings, where appropriate.  

In 2009 the hearing officer had 30 interventions in 24 cases and held 14 hearings. He 
intervened at different stages of the investigations – at complaint's stage, sampling, 
MET/IT,  choice  of  an  analogue  country,  provisional,  undertaking  and  definitive 
stage.  The  requests  also  concerned  issues  covering  almost  all  aspects  of  an 
investigation.  

The majority of requests for intervention of the hearing officer in 2009 concerned the 
access to and the quality of the non-confidential files. The other main field of activity 
of the hearing officer concerned the timing and content of disclosures. 

An  update  of  the  Guidelines  on  cooperation  between  the  Hearing  Officer  and  the 
trade  investigation  services  should  soon  be  approved.  Thereafter  information  about 
their content will be made available on the internet site of the Hearing Officer. The 
discussion  about  a  Commission  decision  on  the  terms  of  reference  for  the  Hearing 
Officer of DG Trade will follow soon.  

Further  details  regarding  the  activity  of  the  Hearing  Officer  can  be  found  in  the 
Working Document to the Annual Report. 

8. 

OVERVIEW OF AD, AS AND SFG INVESTIGATIONS AND MEASURES 

8.1. 

General 

At the end of 2009, the EU had 135 AD measures (see Annex O) and 8 AS measures 
(see Annex P) in force. 

In 2009, 0.6% of total imports into the EU were affected by AD or AS measures. 

Please note that details on the issues hereafter are given in the  Working  Document 
attached to this report. The references to the Annexes of the Working Document can 
be found beside the titles.  

8.2. 

New investigations (see Annexes A through E and Annex N) 

In  2009,  21  investigations  were  initiated1.  Provisional  duties  were  imposed  in  10 
proceedings.  10  cases  were  concluded  with  the  imposition  of  definitive  duties.  11 

1 

Table  1  in  the  Working  Document  provides  statistical  information  on  the  new  investigations  for  the 
years 2005 – 2009 carried out under the provisions of Articles 5 and 10 of the basic Regulations. 

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proceedings  were  concluded  without  measures.  4  measures  expired  automatically 
following their 5-year duration. 

8.3. 

Review investigations 

Review  investigations  continue  to  represent  a  major  part  of  the  work  of  the  TDI 
services.  In  the  period  2005-2009  they  accounted  for  54%  of  all  investigations 
initiated.  Table  2  in  the  Working  Document  provides  statistical  information  for  the 
years 2005-2009. 

8.3.1.  Expiry reviews (see Annex F) 

Articles  11(2)  and  18  of  the  basic  Regulations  provide  for  the  expiry  of  measures 
after five years, unless an expiry review demonstrates that they should be maintained 
in their original form.  

During 2009, 11 expiry review investigations were initiated. 5 expiry reviews were 
concluded with a confirmation of the duty for a further period of 5 years. No expiry 
reviews were concluded by the termination of measures.  

8.3.2. 

Interim reviews (see Annex G) 

Articles  11(3)  and  19  of  the  basic  Regulations  provide  for  the  review  of  measures 
during their period of validity. Reviews can be limited to dumping/subsidization or 
injury aspects. 

During  2009,  a  total  of  14  interim  reviews  were  initiated.  13  interim  reviews  were 
concluded with confirmation or amendment of duty. 1 investigation was concluded 
with the termination of measures.  

8.3.3.  “Other” interim reviews (see Annex H) 

2 'other' reviews, not falling under Articles 11(3) or 19 of the basic Regulations were 
initiated during 2009.  

6  such  reviews  were  concluded  in  2009  with  confirmation  or  amendment  of  the 
measures. They specifically concern, inter alia, actions following court judgements, 
following WTO DSU proceedings, clarification of the scope of measures, etc.  

8.3.4.  New exporter reviews (see Annex I) 

Articles 11(4) and 20 of the basic Regulations respectively provide for a “newcomer” 
and  “accelerated”  review  in  order  to  establish  an  individual  dumping  margin  or  an 
individual countervailing duty for new exporters located in the exporting country in 
question  which  did  not  export  the  product  during  the  investigation  period.  Such 
exporters  have  to  show  that  they  are  genuine  new  exporters  and  that  they  have 
actually  started  to  export  to  the  EU  after  the  investigation  period.  As  such,  an 
individual duty, which is usually lower than the country-wide duty, can be calculated 
for them.  

In 2009, 6 new exporter reviews were initiated.  

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8.3.5.  Absorption investigations (see Annex J) 

Where  there  is  sufficient  information  showing  that,  after  the  original  investigation 
period  and  prior  to  or  following  the  imposition  of  measures,  export  prices  have 
decreased or that there has been no or insufficient movement in the resale prices or 
subsequent selling prices of the imported product in the EU, an "absorption" review 
may  be  opened  to  examine  whether  the  measure  has  had  effects  on  the  above-
mentioned  prices.  Dumping  margins  may  as  such  be  recalculated  and  the  duty 
increased to take account of such lower export prices. The possibility of "absorption" 
reviews is included in Articles 12 and 19(3) of basic Regulations. 

In 2009, there were no anti-absorption reviews initiated or concluded.  

8.3.6.  Circumvention investigations (see Annex K) 

The possibility of investigations being re-opened in circumstances where evidence is 
brought to show that measures are being circumvented is foreseen in Articles 13 and 
23 of the basic Regulations. 

In  2009,  1  such  investigation  was  initiated.  1  anti-circumvention  investigation  was 
concluded with extension of the duty.  

8.4. 

Safeguard investigations (see Annex L) 

During 2008, there was no safeguard activity in the EU.  

9. 

ENFORCEMENT OF AD/AS MEASURES 

9.1. 

Follow-up of measures 

The  follow-up  activities  concerning  measures  in  force  were  centred  on  four  main 
areas: (1) to pre-empt fraud; (2) to monitor trade flows and market developments; (3) 
to  improve  the  effectiveness  with  the  appropriate  instruments  and  (4)  to  react  to 
irregular  practices.  These  activities  enabled  the  TDI  services  to  pro-actively  in 
cooperation  with  Member  States  ensure  the  proper  enforcement  of  trade  defence 
measures in the European Union.  

9.2.  Monitoring of undertakings (see Annexes M and Q) 

Monitoring  of  undertakings  forms  part  of  the  enforcement  activities,  given  that 
undertakings  are  a  form  of  AD  or  AS  measures.  They  are  accepted  by  the 
Commission if it is satisfied that they can effectively eliminate the injurious effects 
of dumping or subsidisation. 

At  the  beginning  of  2009,  there  were  46  undertakings  in  force.  During  2009,  the 
following  changes  to  the  portfolio  of  undertakings  took  place:  undertakings  of  3 
companies  came  to  an  end  due  to  the  expiry  of  measures  2  undertakings  were 
withdrawn  by  the  Commission  due  to  breaches  found  and  1  undertaking  offer  was 
accepted. This brings the total number of undertakings in force at the end of 2009 to 
42.  

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10. 

REFUNDS (SEE ANNEX U) 

Articles  11(8)  and  21(1)  of  the  basic  Regulations  allow  importers  to  request  the 
reimbursement  of  the  relevant  collected  duties  where  it  is  shown  that  the 
dumping/subsidy margin, on the basis of which duties were paid, has been eliminated 
or reduced to a level below that of the duty in force. 

During  2009,  39  new  refund  requests  were  submitted.  At  the  end  of  2009,  7 
investigations  were  ongoing,  covering  25  requests.  5  Commission  Decisions  were 
adopted:  3  were  granting  partial  refund  and  2  were  rejecting  the  refund  request.  7 
requests were withdrawn. 

11. 

JUDICIAL REVIEW: DECISIONS GIVEN BY THE COURT OF JUSTICE (COJ) / GENERAL 
COURT (GC)  

In  2009,  the  Court  of  Justice  (COJ)  and  the  General  Court  (GC)  rendered  13 
judgments in total relating to the areas of anti-dumping or anti-subsidy. Of these, one 
was a judgment interpreting another judgment. A summary of some of the judgments 
is given in the Working Document. 

There were 17 new cases lodged in 2009, 10 before the GC and 7 before the COJ.  

A list of the AD/AS cases before the GC and the COJ still pending at the end of 2009 
is given in Annex S of the Working Document. 

12. 

ACTIVITIES IN THE FRAMEWORK OF THE WORLD TRADE ORGANIZATION (WTO) 

12.1.  Dispute settlement in the field of AD, AS and SFGs  

The WTO provides for a rigorous procedure for the settlement of disputes between 
WTO Members concerning the application of the WTO agreements. 

In April 2009, following India's request for consultations addressed to the EU at the 
WTO,  consultations  were  held  regarding  the  AD  and  AS  measures  in  place  on 
Polyethylene terephthalate (PET). 

Following  China's  request  for  consultations  addressed  to  the  EU  at  the  WTO, 
consultations  regarding  the  AD  measures  in  place  on  certain  iron  or  steel  fasteners 
were held in September 2009. 

Further  details  on  these  cases  are  given  in  the  Working  Document  attached  to  this 
report. 

12.2.  Other WTO activities  

In  2009,  the  DDA  Negotiating  Group  on  rules  met  regularly  to  discuss  the  revised 
Chair's draft text which was circulated in December 2008 and the fisheries subsidies 
"roadmap". In this revised version, most contentious issues were taken out from the 
anti-dumping  and  subsidies  texts  and  were  replaced  by  "placeholders"  which 
summarised the points of contention among Members on each issue.  

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No  progress  could  be  achieved  on  any  of  these  issues  in  the  anti-dumping  and 
horizontal subsidies areas. In fisheries, the group conducted intensive discussions on 
the basis of the questions contained in the Chair's roadmap. While this allowed the 
views of Members to be clarified on key issues, it did not help positions to converge. 

In parallel to these activities, participation by the Commission services in the regular 
work  of 
the  Anti-dumping,  Subsidies  and  Countervailing  and  Safeguards 
Committees  continued.  The  Committees  met  twice  in  regular  sessions  to  review 
notifications and raise issues of special interest. 

CONCLUSION 

2009 showed a slight increase in the number of new cases initiated over the previous 
year  with  a  decrease  in  the  number  of  definitive  measures  imposed.  There  was  a 
considerable  increase  in  the  number  of  investigations  terminated  without  the 
imposition of measures and a doubling of the provisional measures imposed over the 
previous  year.  Regarding  reviews,  the  number  of  reviews  initiated  increased 
significantly while the number of reviews terminated showing a huge drop over 2008 
figures.  

2009 brought improvements in the transparency of trade defence investigations. The 
Commission  started  implementing  a  number  of  initiatives  which  had  been  agreed 
following  consultations  with  the  Member  States.  The  actions  included  revamp  of 
TDI website, specific assistance for SMEs and improved disclosure. This work will 
be ongoing.  

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