REPORT FROM THE COMMISSION 29th Annual Report from the Commission to the European Parliament on the EU's Anti-Dumping, Anti-Subsidy and Safeguard activities (2010)
Date: 2012-02-16
Institutions: European Commission
Subjects: Armenia, Belarus, China, Kazakhstan, Mongolia, Viet Nam, anti-dumping legislation, common commercial policy, market economy, raw material, trade dispute

EUROPEAN COMMISSION 

Brussels, 16.2.2012 
COM(2012) 59 final 

REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT 

29th Annual Report from the Commission to the European Parliament on the EU's 
Anti-Dumping, Anti-Subsidy and Safeguard activities (2010) 

{SWD(2012) 9 final} 

 
 
 
 
  
 
INTRODUCTION 

This  2010  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 2010 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 MODERNISATION  

The EU considers that  a  periodic  review  of the EU's trade defence instruments can 
help  to  ensure  their  effectiveness  in  response  to  unfair  trading  practises.  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 highlighted the 
need to obtain consensus among stakeholders.  

In  the  meantime  in  September  2010,  as  part  of  the  normal  cycle  of  DG  Trade's 
evaluation  planning,  the  Commission  published  an  invitation  to  tender  for  an 
evaluation  of  the  European  Union's  trade  defence  instruments.  Such  an  evaluation 
would  help  the  Commission  design  or  improve  its  policy  interventions,  and  to 
monitor  their  effectiveness.  It  would  also  help  citizens  to  exercise  their  right  to 
scrutinize,  criticise  and  influence  the  policies  and  activities  conducted  by  the 
Commission  on  their  behalf.  Following  the  evaluation  of  the  offers  submitted,  a 
contract  was  signed  at  the  end  of  December  2010.  The  work  was  ongoing  in  2011 
with results expected early 2012. 

The  Commission  already  implemented  in  2010  measures  (such  as  revamp  of  TDI 
website;  specific  assistance  for  SMEs;  improved  disclosure  etc.)  that  improve 
transparency in trade defence investigations.  

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.  

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2010 saw the continued evaluation of five of the six requests for country-wide MES 
from  China,  Vietnam,  Armenia,  Kazakhstan,  Mongolia  and  Belarus.  All  countries, 
except Belarus, continued to provide additional information in support of their claims 
throughout  the  year  and  their  requests  are  at  various  stages  of  progress.  The 
Consultations with the authorities of the Republic of Belarus were put on hold due to 
the  political  situation  in  the  country.  The  other  five  applicant  countries  are  at 
different stages of progress in terms of meeting the five criteria for MES. 

Work  continued  on  the  MES  request  from  China  including  the  10th  thematic  MES 
Working  Group  meeting  in  Beijing  in  September  2010.  At  the  working  group 
meeting both parties discussed, inter alia, the ongoing joint study on the accounting 
practices  in  the  People’s  Republic  of  China,  especially  the  issue  of  access  by  the 
consultants  to  the  Chinese  companies.  Further  work  took  place  on  the  China  MES 
file in 2011.  

The  first  assessment  report  on  Armenia's  MES  request  was  transmitted  to  the 
Armenian authorities early in 2010, informing them that they had fulfilled two of the 
five criteria for MES. This was followed by a request for information in June 2010  
on  further  developments  in  their  progress  towards  MES.    However,  by  the  end  of 
2010 no new information had been sent to the Commission by Armenia.    

Vietnam's  second  preliminary  assessment  report  was  completed  in  February  2010, 
which  concluded  that  Vietnam  fulfils  one  of  the  five  criteria  which  relates  to  the 
degree  of  government  interference  in  the  economy.  Specific  MES  meetings  took 
place in September 2010 with Vietnam. Further analysis took place on the file during 
2011. 

Regarding  Kazakhstan  at  the  end  of  2010,  DG  Trade's  services  concluded  that 
although there have been positive developments their progress had been hampered by 
their  response  to  the  impact  of  the  global  financial  crisis  on  their  economy.  It  is 
intended  that  a  road  map  will  be  jointly  developed  with  Kazakhstan  setting  out  the 
next steps to be taken on MES. 

At  the  EU-Mongolia  Trade  Committee  in  October  2010  the  Commission  provided 
information on progress of the MES assessment and requested further information in 
December 2010.  

5. 

TRADE DEFENCE INSTRUMENTS – RAW MATERIAL STRATEGY 

In the Annual Report for 2009 the role of TDI in addressing certain consequences of 
distortions  in  the  supply  of  raw  materials  was  highlighted  for  the  first  time.  In 
particular,  attention  was  drawn  to  the  fact  that  for  the  first  time  MET  had  been 
refused  to  five  Chinese  companies  manufacturing  fasteners  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.   

During  2010  the  Commission  continued  this  practice  in  evaluating  any  market 
economy  treatment  claims  by  examining,  inter  alia,  any  policies  which  result  in 
distorted  prices  of  raw  materials.  An  example  of  one  such  case  in  2010  where  the 
issue arose is aluminium road wheels from China.   

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6. 

INFORMATION AND COMMUNICATION ACTIVITIES/ BILATERAL CONTACTS  

6.1. 

Small and medium sized enterprises (SMEs) 

At  the  end  of  2009  the  Commission,  in  recognising  the  important  role  that  SMEs 
have  in  the  EU's  economy  and  the  difficulties  they  face  in  participating  in  trade 
defence  investigations,  launched  a  study  to  identify  the  needs  of  SMEs  in  the  EU 
when  participating  in  trade  defence  investigations.  At  the  end  of  2010,  the 
Commission received from a contractor the results of the study identifying the needs 
of SMEs in the 27 EU Member States when submitting a complaint or participating 
in  trade  defence  investigations  as  an  importer,  as  a  user  or  as  exporters  in 
investigations initiated by third countries. The outcome of the study also laid down 
specific proposals on how the Commission and the Member States could better assist 
SMEs in all areas of such investigations. 

The  Review  identifies  a  set  of  concrete  measures  to  support  SMEs  growth  and 
competitiveness  and  proposes  in  particular,  actions  to  increase  information  and 
assistance  to  SMEs  with  regard  to  the  use  of  the  EU  Trade  Defence  Instruments. 
Such actions were discussed with National authorities involved in Trade Defence and 
DG  TRADE's  Trade  Defence  services  with  the  intention  of  adopting  in  2011  a 
declaration  outlining  a  number  of  concrete  actions  to  address  the  difficulties 
encountered by SMEs involved in Trade Defence Instruments.  

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.  This 
TDI  website  was  further  updated,  making  it  more  accessible  and  user-friendly, 
especially for SMEs. 

their  small  size  and 

In 2010 these contact points received many requests for information, which were all 
immediately addressed. These requests concerned both the procedures and content of 
TDI proceedings. 

6.2. 

Bilateral contacts/information activities – industry and third countries 

Explaining  the  legislation  and  practice  of  the  EU's  trade  defence  activity  is  an 
important part of the work of the TDI services.  

A seminar on trade defence for officials from third countries took place in 2010.  In 
addition,  there  were  a  number  of  bilateral  contacts  dedicated  to  discussing  various 
trade defence related topics with a number of third countries including China, Korea, 
Vietnam, India, Belarus and Australia held in 2010. 

There were also several meetings with key stakeholder associations and companies in 
2010, including a number of events with Business Europe (namely a seminar 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  seminar  and  regular 
meetings  with  the  most  relevant  associations  of  importers  and  distributors,  such  as 
Eurocommerce and FTA.  

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7. 

HEARING OFFICER 

2010  was  the  third  year  of  activity  for  the  Hearing  Officer  for  DG  Trade,  who 
became  operational  in  April  2007.  The  Hearing  Officer  acts  independently.  He  is 
attached for administrative purposes to the Director General of DG Trade to whom 
he reports.  

The  Hearing  Officer's  principal  role  is  to  safeguard  the  effective  exercise  of  the 
procedural rights of interested parties and to ensure that the trade proceedings before 
the  European  Commission  are  handled  impartially,  fairly  and  within  a  reasonable 
time. The Hearing Officer also advises the Director General of DG Trade on issues 
related  to  due  process  and  on  any  issue  arising  out  of  a  trade  proceeding,  where 
appropriate.  

An  update  of  the  Guidelines  on  cooperation  between  the  Hearing  Officer  and  the 
Commission  trade  investigation  services  was  adopted.  They  set  out  a  number  of 
operating  principles  and  introduce  time  windows  for  the  organisation  of  hearings. 
There  are  rules  on  interventions  with  regard  to  confidentiality  issues  and  access  to 
files  and  a  number  of  mechanisms  for  communication  and  follow-up  on  the 
interventions of the hearing officer. The updated guidelines were used as a basis for a 
draft Terms of Reference of the Hearing Officer. In the course of 2010 and 2011 this 
decision  was  subject  of  internal  consultations  with  its  adoption  foreseen  for  early 
2012. 

In 2010 the Hearing Officer had 55 interventions in 29 trade defence cases and held 
24  hearings  which  represent  a  significant  increase  in  comparison  with  2009.  The 
Hearing  Officer  was  contacted  by  interested  parties,  Commission  investigation 
services,  and  stakeholders.  He  intervened  on  issues  covering  all  stages  of  the 
investigation.  

The  main  issues  that  the  Hearing  Officer  faced  in  2010  can  be  grouped  in  six 
categories:  (i)  MET  determinations;  (ii)  non-confidential  files  and  confidentiality; 
(iii)  content  and  timing  of  disclosures;  (iv)  definition  of  a  Union  producer,  an 
importer, or a user; (v) criteria for the selection of an analogue country; and (vi) use 
of experts.  

A  number  of  good  practices  have  been  adopted  at  the  recommendation  of  the 
Hearing  Officer  and  after  the  conclusions  of  working  groups  created  by  the 
Commission services. For example, the services have started including in the file for 
consultation by interested parties notes to the file on pre-decisions such as sampling. 
The timing of sending disclosure documents to interested parties also has improved. 
The  Hearing  Officer  has  not  received  many  complaints  with  the  exception  of  the 
Market Economy Treatment (MET) disclosure documents. In one case, the services 
contracted  an  expert  who  helped  to  analyse  possible  circumvention.  The  hearing 
officer expects that more experts will be used in future cases. 

Taking into account the increased number of interventions and the variety of issues 
dealt with, it could be claimed that the function of the Hearing Officer is now well 
established. 

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8. 

OVERVIEW  OF  ANTI-DUMPING,  ANTI-SUBSIDY  AND  SAFEGUARD  INVESTIGATIONS 
AND MEASURES 

8.1. 

General 

At  the  end  of  2010,  the  EU  had  124  AD  measures  (see  Annex  O)  and  11  AS 
measures (see Annex P) in force. 

In 2010, 0.43% 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  2010,  18  investigations  were  initiated1.  Provisional  duties  were  imposed  in  13 
proceedings.  9  cases  were  concluded  with  the  imposition  of  definitive  duties.  10 
investigations were concluded without measures. 14 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  2006-2010  they  accounted  for  61%  of  all  investigations 
initiated.  Table  2  in  the  Working  Document  provides  statistical  information  for  the 
years 2006-2010. 

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 2010, 14 expiry review investigations were initiated. 10 expiry reviews were 
concluded  with  a  confirmation  of  the  duty  for  a  further  period  of  5  years.  1  expiry 
review was 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  2010,  a  total  of  12  interim  reviews  were  initiated.  9  interim  reviews  were 
concluded  with  confirmation  or  amendment  of  duty.  No  interim  reviews  were  was 
concluded with the termination of measures.  

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Table  1  in  the  Working  Document  provides  statistical  information  on  the  new  investigations  for  the 
years 2006 – 2010 carried out under the provisions of Articles 5 and 10 of the basic Regulations. 

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

There were no 'other' reviews, i.e. not falling under Articles 11(3) or 19 of the basic 
Regulations, initiated or concluded during 2010.  

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 2010, 3 new exporter reviews were initiated.  

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 2010, 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 2010, 2 such investigations were initiated. 1 anti-circumvention investigation was 
concluded with extension of the duty and 1 was concluded without extension of the 
measures.  

8.4. 

Safeguard investigations (see Annex L) 

During 2010, 1 safeguard investigation was initiated.  

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 

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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  2010,  there  were  42  undertakings  in  force.  During  2010,  the 
following  changes  to  the  portfolio  of  undertakings  took  place:  undertakings  of  1 
company  came  to  an  end  due  to  the  expiry  of  measures,  undertakings  of  three 
companies were accepted and  22 undertakings were withdrawn by the Commission 
due to breaches found. This brings the total number of undertakings in force at the 
end of 2010 to 22. 

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  2010,  29  new  refund  requests  were  submitted.  At  the  end  of  2010,  15 
investigations  were  ongoing,  covering  27  requests.  In  2010,  28  Commission 
Decisions were adopted: 23 granting partial refund and 5 rejecting the refund request. 
12 requests were withdrawn. 

11. 

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

In  2010,  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. A summary 
of some of the judgments is given in the Working Document. 

There were 13 new cases lodged in 2010, 8 before the GC and 5 before the COJ.  

A list of the AD/AS cases before the GC and the COJ still pending at the end of 2010 
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. 

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In  February  2010,  China  requested  consultations  with  the  European  Union 
concerning  anti-dumping  measures  on  certain  leather  footwear  from  China  which 
had been imposed in 2006. Consultations were held in March 2010. Subsequently, in 
April 2010, China requested the establishment of a panel. The panel was established 
in  May  2010  and  its  members  were  elected  in  July  2010.    The  panel  report  was 
issued in October 2011.  

In December 2010, a report was circulated setting out the findings of a WTO panel in 
a dispute settlement case taken by China against the EU on anti-dumping measures 
on  imports  of  certain  iron  or  steel  fasteners  originating  in  China.    The  panel  found 
that in the majority of the issues examined, the EU had acted in full compliance with 
WTO  rules.  There  were,  however,  a  number  of  issues  where  the  Panel  found  that 
certain  aspects  of  the  EU's  basic  legislation  and  practice  were  inconsistent  with 
certain  elements  of  the  WTO  Anti-dumping  Agreement.      The  case  was  subject  to 
appeal and the WTO Appellate Body issued a report on the case in July 2011. On 18 
August 2011, the European Union informed the Dispute Settlement Body (DSB) that 
it  intends  to  implement  the  recommendations  and  rulings  of  the  DSB  in  a  manner 
that respects its WTO obligation within a reasonable period of time. 

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

12.2.  Other WTO activities  

In 2010, H.E. Mr. Dennis Francis (Trinidad and Tobago) was appointed Chair of the 
DDA Negotiating Group on rules. Under his Chairmanship, the Group met regularly, 
including  in  Plurilateral  format,  to  discuss  the  bracketed  and  unbracketed  issues  of 
the  Chair's  text  of  December  2008.  Furthermore,  several  new  textual  proposals 
covering  various  aspects  of  the  Subsidies  and  Countervailing  Measures  Agreement 
were  submitted,  including  by  India  and  China.  However,  no  progress  could  be 
achieved in the anti-dumping and horizontal subsidies areas.  

In  fisheries,  the  group  conducted  intensive  discussions  on  all  aspects  of  possible 
disciplines. While this allowed the views of Members to be clarified on key issues, it 
did  not  help  positions  to  converge  but  rather  confirmed  the  deep  division  among 
Members (developing and developed countries alike) as well as the complexity and 
sensitivity of the situation of developing countries. 

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 

2010  showed  a  slight  decrease  in  both  the  number  of  new  cases  initiated  over  the 
previous year as well as the number of definitive measures imposed. The number of 
investigations  terminated  without  the  imposition  of  measures  also  dropped  slightly 
while the number of provisional measures imposed over the previous year increased 
by almost a third. Regarding reviews these continue to represent a significant part of 
the work of the services with the number of reviews initiated dropping slightly when 

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compared to 2009. The number of reviews terminated was halved in comparison to 
2009 figures.  

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