REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT TENTH REPORT OVERVIEW OF THIRD COUNTRY TRADE DEFENCE ACTIONS AGAINST THE EUROPEAN UNION FOR THE YEAR 2012
Date: 2013-04-22
Institutions: European Commission
Subjects: Belarus, Brazil, China, Israel, Kazakhstan, Russia, export (EU), protectionism, trade dispute

EUROPEAN 
COMMISSION 

Brussels, 22.4.2013  
COM(2013) 217 final 

REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT 

TENTH REPORT 

OVERVIEW OF THIRD COUNTRY TRADE DEFENCE ACTIONS 
AGAINST THE EUROPEAN UNION FOR THE YEAR 2012 

{SWD(2013) 140 final} 

EN 

   EN 

 
 
 
 
  
 
 
REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT 

TENTH REPORT 

OVERVIEW OF THIRD COUNTRY TRADE DEFENCE ACTIONS 
AGAINST THE EUROPEAN UNION FOR THE YEAR 2012 

 
 
 
1. 

INTRODUCTION 

EU exporters remain exposed to Trade Defence Measures imposed by third countries. Such 
measures are in principle allowed under the WTO rules but if not properly applied, they turn 
into protectionist tools. To avoid resorting to protectionism was also one of the pledges 
leaders have taken in G20.  

The EU uses Trade Defence Measures as well although they affect only a very small share of 
imports. Moreover, the EU is more demanding than other WTO members when it considers 
the imposition of measures because additional tests have to be met before such measures are 
adopted (so-called 'WTO pluses').   

In addition to applying high standards in its own investigations, the role of the Commission is 
to monitor the activity of third countries when they use Trade Defence against EU exports, 
and to intervene if WTO rules are not respected. This is for instance done through technical 
interventions within the framework of on-going investigations. The ultimate possibility is 
resorting to WTO dispute settlement proceedings when the issues are important and no other 
solution can be found. 

Even if the activity concerning EU exports has stabilised in the most recent years, after a steep 
increase of the number of investigations in 2008-2009, cases are becoming more complex and 
new users of the instruments have appeared in the last years. This has required careful 
monitoring and ever increasing activity in 2012. 

This report describes overall trends, the problems identified and results achieved in 2012. It 
also gives in the annex a detailed analysis of trends and specific cases of the most important 
users of the instrument. 

2.  OVERALL TRENDS 

In total there were 138 measures in force at the end of 2012, a number relatively stable as 
compared to last year. The number of measures in force has thus stabilised in 2012, after a 
significant increase in the period 2010-2011, from 123 to 146 measures. 

As in the previous years, the vast majority of these measures are anti-dumping actions (94 
measures) while safeguards still represents about one third of the total. It should however be 
noted that not all these safeguard measures directly affect EU exports. Indeed, since 
safeguards are imposed against all countries of origins, all of them are included in the 
statistics, even if there are no or little EU exports. 

India has been an intensive user of the instrument in 2012 (see below) and has reached a 
higher number of measures in force against the EU than the USA, the historical leader, with 
respectively 21 and 18 measures. China confirmed its third position (16 measures) while other 
important users such as Brazil and Turkey have reduced their number of measures in force 
against the EU (10 measures each). 

In total, 20 new measures have been imposed in 2012. This is much less than in 2011 (36), 
which was however an exceptional year mostly because a significant number of safeguard 
measures were imposed that year (22). In 2012 the number of new safeguard measures was 
more limited (8) and the number of new anti-dumping measures (12) remained comparable to 
the prior year. Not surprisingly, India was the most active player with the imposition of 7 new 
measures in 2012 (6 anti-dumping and 1 safeguard). 

37 new investigations have been initiated in 2012, as compared to 33 in 2011. It should be 
noted that about half of these investigations have been initiated in the last two months of the 
year, i.e. most of the monitoring work for these investigations will occur in 2013. Indonesia 

 
 
was the most active country (6 safeguards) followed by China, Egypt and Turkey (4 new 
investigations each). The vast majority of these new investigations concerned safeguards (23). 

3.  ONGOING PROBLEMS 

Even if the Commission's interventions have helped solving a number of issues and resulted 
in the improvements of the standards in some countries, many problems identified in the past 
continue to exist. The Commission is applying high standards in its own investigations and 
expects that comparable standards are applied by third countries. Basic WTO rules should be 
strictly applied in order to avoid undue market access restrictions for EU industries abroad. 

The main persisting problems are the following:  

3.1. 

Inappropriate use of the instruments 

Since a couple of years there have been obvious indications that TDI cases were initiated by 
third countries in retaliation to measures imposed by the EU rather than based on justified 
grounds supported by a duly documented application made by the domestic industry 
concerned. For example, in the past, measures have been imposed against EU exports of 
products similar to those which were previously targeted by EU investigations, and this 
occurred shortly after the EU had introduced its own measures. 

In this context, there are indications that in 2012 China continued to make use of Trade 
Defence Instruments in reaction to cases initiated against them. According to press reports, 
another example occurred in 2012: China initiated a combined anti-dumping and anti-subsidy 
investigation against imports of polysilicon produced in the EU most likely in reaction to the 
initiation of the EU investigations against solar panels from China. The US had experienced 
exactly the same problems when they imposed measures against solar panels from China.   

Such a use of the instrument is not acceptable, as it is not based on a genuine application from 
an allegedly injured industry to address perceived unfair competition, but likely to have a 
weak factual and legal basis. The Commission has addressed this issue both at political and at 
technical level during the investigations. Lacking any meaningful response to its concerns, it 
had no other option than having recourse to the WTO dispute settlement. The Commission 
requested the establishment of a panel in 2012 concerning the Chines measures on X-ray 
scanners (imposed in reaction to EU measures on the same product). As explained below, the 
Commission was successful in this legal dispute and it is hoped that China will change its 
practice in the future. As long as this is not the case the Commission will continue its strong 
interventions, including at WTO level if necessary. 

3.2.  Use of safeguards 

The number of safeguard measures imposed decreased significantly in 2012. This is certainly 
a positive development, but nevertheless the high number of new initiations of safeguard 
investigations remains worrying. 

On the positive side, safeguard measures could be avoided in a number of occasions, also 
following the Commission’s interventions. However, even in these cases, the situation 
remains problematic because investigations are still too often initiated on a weak basis and, in 
spite of the absence of measures, trade flows are negatively affected during the time of the 
investigation because of the uncertainties it creates on the market. The Commission thus 
continues to advocate for a stricter approach when considering the initiation of safeguard 
investigations. 

In 2012 some countries have substantially used the safeguard instrument. This is in particular 
the case of Indonesia (6 new initiations in 2012, 3 in 2011 and 5 in 2010), Egypt (4 new 

 
 
initiations in 2012) and the Eurasian Customs Union formed by Russia, Belarus and 
Kazakhstan (3 new investigations in 2012). The latter investigations are those that could 
potentially have the most important impact on EU Member States, not least because of the 
importance of the markets and the geographical proximity that also has an effect on trade 
flows. The investigations initiated by Indonesia and Egypt are less important in economic 
terms but however require also a careful monitoring because they indicate a worrying trend in 
the use of safeguards. 

3.3.  Lack of transparency 

The lack of transparency continues to be a major concern both at initiation stage and when 
results of the investigations are disclosed. This is of course an essential issue since it deprives 
the parties from their rights of defence and leaves doubts as to whether the rules were indeed 
properly applied. 

The Commission continuously intervenes in individual cases to improve the situation and, 
when possible, uses bi-lateral technical communication channels established with some 
countries in order to reach more transparency.  

4.  MAIN ACHIEVEMENTS 

In the last years the Commission had to resort occasionally to WTO settlement in order to 
solve some important and systemic issues. Panel proceedings require considerable resources, 
are very time consuming and results may only materialise after years of proceedings. In this 
context, some significant positive results were achieved in the last years. The long dispute 
against the US led to the abolishment of the practice of zeroing (see last year’s report) and the 
more recent dispute against China could tackle the unacceptable practice of retaliation. The 
resolution of these disputes has a direct impact on existing cases or measures, but it is likely 
to also be beneficial for the future since the issues challenged were of a systemic nature. 

In addition to solution for systemic issues, the Commission also intervened almost 
systematically in investigations for which there was a clear interest for EU industries. This has 
led to a number of achievements in a number of individual cases. 

The systematic interventions as well as regular bi-lateral contacts with third countries in order 
to promote high standards in Trade Defence investigations also had undoubtedly an important 
positive impact, which is however very difficult to measure.  

The Commission also received regular positive feedback from industries for the guidance and 
assistance they have received even if measures could not always be avoided. 

Below is a list of some of the individual positive results achieved during the year 2012. 

China – Panel report on measures against x-ray scanners 

The Commission has decided to challenge the Chinese anti-dumping duties on imports of x-
ray security scanners (measures ranging from of 33.5% to 71.8%) because it was considered 
that these measures were not legally warranted and that they had been imposed in retaliation 
against the EU's own case concerning cargo scanners from China. A WTO Panel was 
established at the beginning of 2012 which, in November 2012, released an interim report - 
with its findings on the EU claims. The interim report was confirmed by the final report 
circulated in February 2013. 

This report represents a clear victory for the EU since it indeed confirmed that China acted 
inconsistently with several provisions of the WTO Anti-dumping agreement. The EU 
prevailed in particular on the claims relating to China's injury investigation which was 
considered not to be objective, and the Panel considered favourably most of the EU’s 

 
 
procedural claims, including a breach of the rules on transparency due to the lack of 
disclosure in the public file, in the final determination and in the public notice.  

The panel's findings are of systemic importance, as they concern recurrent features of 
investigations carried out by China. The outcome is thus clearly positive to the EU and should 
have a positive impact for the future as well. 

Brazil wine – termination without measures 

In March 2012, Brazil initiated a safeguard investigation against imports of wine. The case 
was economically important since more than € 85 million yearly exports  were potentially 
affected (Spain, Portugal, Italy and France), and the Brazilian market is further expanding. 
After an in-depth analysis of the case, the Commission identified important weaknesses, in 
particular with respect to the definition of the domestic industry, the injury and causality 
aspects. The Commission made extensive submissions in this regard, and participated in the 
public hearing held in Brasilia in June 2012. The investigation was finally terminated without 
the imposition of measures in October 2012, and the Commission's strong interventions, the 
very good co-ordination with the Member States concerned, the industry and the importers in 
Brazil that were also very active in this case have all contributed to this positive result.  

Russia-Belarus-Kazakhstan – termination without measures 

On 1 February 2012 the Eurasian Economic Commission (EAEC), the legal successor of the 
Commission of the Customs Union, started its activity and all investigations from national 
authorities of Russia, Belarus and Kazakhstan were ultimately transferred to the EAEC on 6 
July 2012. This new authority has been very active initiating new cases and the Commission 
has persistently intervened with a view to highlight the legal weaknesses identified. 

In this context, the safeguard investigation on graphite electrodes initiated on 31 August 2011 
by Russia and later transferred to the EAEC was terminated on 30 August 2012 without the 
imposition of any safeguard measure. The Commission had actively intervened in this case 
for which EU exports represented around € 25 million per year . 

Israel – measures avoided 

Over the last years Israel has become a relatively important user of the anti-dumping 
instrument against the EU (8 investigations initiated since 2009). Several WTO 
inconsistencies were found, including very important and basic ones. Given the systemic 
nature of the problems identified, the Commission intervened in all these cases. In 2011 two 
investigations were terminated without measures and again in 2012 measures could also be 
avoided in two cases (around € 20 million of yearly exports ), despite the proposal of the 
investigating authorities to impose measures in one of these cases (food mixers). Strict 
monitoring, however, remains necessary because there are still on-going investigations and 
unfortunately the same problems (e.g. meaningless non-confidential complaints) are still 
present. 

5.  CONCLUSION 

The Commission applies high standards in its own investigations and expects third countries 
to do the same in their proceedings. In this context, systematic interventions are necessary in 
order to remind them of their WTO obligations.  

Even if the number of measures in force has stabilised in 2012 after an important increase in 
previous years, there has been a significant number of new initiations in the last quarter of the 
year. The issues are becoming more complex and relatively new users have appeared recently.  

 
 
In this context, the Commission has been forcefully monitoring third country cases and 
intervened in almost all cases for which EU exports were targeted. In addition considerable 
efforts and resources have also been allocated to resolve issues through WTO disputes. 
Favourable Panel reports are expected to have positive impact also for future cases. 

This has resulted in a number of positive developments and significant results were achieved 
in 2012: measures could be avoided in some cases or their negative impact reduced, and very 
important systemic issues were also solved. 

This year again there has been an excellent cooperation with the EU Member States, the 
European associations of producers, and the companies concerned. Assistance provided by 
EU delegations on the export market has also been intense and well appreciated by EU 
industries and Member States. Once more, co-ordinated joint actions significantly increased 
the chances of success.