EU adopts tougher rules for trade defence legislation

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EU adopts tougher rules for trade defence legislation

Global Trade News Alert – 15-2018

In the midst of growing challenges to global trade, and following the endorsement of the European Parliament, new rules will come into effect in the first half of June 2018 (after their publication in the Official Journal) to strengthen the EU’s anti-dumping and anti-subsidy legislation.

13 June 2018

In the midst of growing challenges to global trade, and following the endorsement of the European Parliament, new rules will come into effect in the first half of June 2018 (after their publication in the Official Journal) to strengthen the EU’s anti-dumping and anti-subsidy legislation.

The new rules respond to a need, expressed by many stakeholders, to modernise of the EU’s legislation to impose anti-dumping and anti-subsidy duties. Tougher tools will allow the European Commission to impose higher tariffs and in a quicker manner.

The most significant changes to current legislation are:

  • Shorter investigations, with a maximum duration of 14 months instead of 15 months;
  • Provisional duties could be imposed seven months after initiation, instead of nine months;
  • Higher duties made possible due to the partial removal of the ‘lesser duty rule’ in certain cases;
  • Increased transparency and predictability, with pre-disclosure requirements for interested parties;
  • Better access for SMEs and trade unions.

The so-called ‘lesser duty rule’ in EU legislation caps anti-dumping or countervailing duties at a level lower than the actual dumping or subsidy margin when such a lower level would be sufficient to remove the injury.

The EU’s departure from the ‘lesser duty rule’ will allow it to impose higher duties when the prices of raw materials are distorted. According to the European Commission’s estimations, this would be the case in approximately half of its anti-dumping decisions.
The EU’s reform complements the recently published amendments to anti-dumping methodology with regard to countries affected by significant market distortions, such as China (see New EU Anti-Dumping Rules in force: Implications for China).

More information on trade defence legislation?

Do you want to know more on trade defence legislation? Please contact Klaas Winters at +31882882125

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