Anti-dumping measures

SUMMARY OF:

Regulation (EU) 2016/1036 on protection against dumped imports from non-EU countries

WHAT IS THE AIM OF THE REGULATION?

Regulation (EU) 2016/1036 sets out the EU’s trade defence rules to protect against imports from non-EU countries dumped on the EU market.

It has been amended three times: by Regulation (EU) 2017/2321, by Regulation (EU) 2018/825 and by Delegated Regulation (EU) 2020/1173.

KEY POINTS

Regulation (EU) 2016/1036 lays down the following rules.

Conditions

Four conditions must be met before anti-dumping measures can be imposed on imports of a product:

the imports must be dumped — if a product’s export price to the EU is less than its normal value*;
there must be material injury* to the EU industry producing the like product*;
there must be a causal link between the dumped imports and the material injury; and
the anti-dumping measure* must not be against the EU interest — the measures should not cause more harm to its overall economy than the relief brought to the industry suffering from the imports.

Initiating a complaint

An anti-dumping complaint is filed with the European Commission by or on behalf of the EU producers of the product concerned either directly or via the authorities of an EU country. Trade unions may also submit complaints jointly with the EU industry and become interested parties in the proceedings. In special circumstances, the Commission may also open an investigation into dumping on its own initiative.
Any complaint must include evidence of dumping, injury and a causal link between the allegedly dumped imports and the alleged injury.
To protect confidential business data, two versions of a complaint need to be lodged: a confidential version and a non-confidential version. The first will be available only to Commission staff directly working on the case. The non-confidential version will be accessible by all interested parties once the investigation is opened.
The Commission must examine the accuracy and adequacy of the evidence provided in the complaint to determine whether there is a sufficient basis to justify initiating an investigation. This must be done within 45 days of the complaint being lodged.

Anti-dumping investigation

Once the Commission decides to launch an investigation, it must publish a notice in the Official Journal of the European Union. It contacts all known manufacturers and all other interested parties requesting them to complete questionnaires by a strict deadline.
Where there are many potentially interested parties, the Commission may decide to carry out its investigation on the basis of a sample of operators (exporting producers, EU manufacturers, importers, users).
Under the original Regulation (EU) 2016/1036, investigations could take 9 months before the Commission could impose provisional measures based on its provisional findings.

A finding of dumping

The following can take place where, based on its investigation, the Commission considers that dumping has occurred.

Anti-dumping measures may be imposed on imports of the product concerned into the EU, which generally take the form of:
- an ad valoremduty — a percentage of the import value of the product concerned;
- specific duties — a fixed value for a certain amount of goods, e.g. €100 per tonne of a product; or
- a price undertaking — a commitment by an exporter to respect minimum import prices.
Provisional measures, where the Commission imposes them, are for a maximum of 6 months. This may be followed by definitive measures which remain in force for 5 years.
The duties are paid by the importer in the EU and collected by the national customs authorities of the EU countries concerned.
Measures in force may be reviewed (interim review) under certain conditions. The scope of this review is usually limited to one or various elements of the initial measures, e.g. the level of dumping and/or injury, the product scope, or the form of the measures.
After 5 years, the measures lapse unless an expiry review concludes that, if the measures were to expire, dumping and material injury would likely continue or recur.
Importers may request a full or partial refund of duties paid if they can show that the dumping margin*, on the basis of which the duties were paid, has been eliminated or reduced.

Amending Regulation (EU) 2017/2321 introduces a dumping calculation methodology to be used in cases concerning imports from World Trade Organization member countries where significant market distortions exist as a result of state intervention.

Amending Regulation (EU) 2018/825

Among other things, the regulation does the following.

It shortened the period of time for the imposition of provisional anti-dumping measures, if any, from 9 months after initiation to 7 months, with the possibility of extending the period to 8 months.
It makes it easier for smaller businesses to participate in trade defence investigations (including a small and medium-sized enterprise (SME) trade defence helpdesk, creating a dedicated SME webpage and publishing a guide for SMEs).
It amends how the rule known as the ‘lesser duty rule’ is applied in anti-dumping cases. The EU could previously only impose measures at a level lower than the full extent of the dumping, where a lower level (the ‘injury margin’) was sufficient to remove the injury suffered by the EU industry. Under the new rules, anti-dumping measures can be imposed at the full level of dumping where there is evidence of significant distortions in the exporting market for relevant raw materials used in the manufacture of the product concerned and provided this is in the interest of the EU as a whole to do so.
It introduces new rules on calculating the ‘non-injurious price’ (the price that the industry is expected to have charged under normal circumstances). The calculation may now take into account the cost of necessary investments, for example, in infrastructure or research and development, but also future expenses related to social and environmental standards, for example under the EU’s emission trading system. The non-injurious price now assumes a minimum profit of 6% that will be included in the calculation, with a higher profit margin possible on a case-by-case basis.
It introduces a pre-disclosure period, during which interested parties received information on the imposition, or not, of provisional measures 3 weeks in advance with an obligation for the Commission to review, by 9 June 2020, whether a substantial rise in imports had occurred during the 3-week period of pre-disclosure and whether, if such a rise had occurred, it had caused additional injury to the EU industries concerned.
It introduces the repayment of duties collected while an expiry review is ongoing if the review results in the termination of the measures.

Delegated Regulation (EU) 2020/1173

In the review carried out in line with amending Regulation (EU) 2018/825, the Commission concluded that, overall, no additional injury to the EU industry had been caused by the imports during the pre-disclosure period. It therefore adopted a delegated act amending the duration of the period of pre-disclosure to 4 weeks.

FROM WHEN DOES THE REGULATION APPLY?

It has applied since 20 July 2016. Regulation (EU) 2016/1036 codified and replaced Regulation (EC) No 1225/2009 and its subsequent amendments.
Amending Regulation (EU) 2017/2321 has applied since 20 December 2017.
Amending Regulation (EU) 2018/825 has applied since 8 June 2018.
Delegated Regulation (EU) 2020/1173 has applied since 11 August 2020.

BACKGROUND

For more information, see:

Anti-dumping (European Commission)
On the consequences of the COVID-19 outbreak on anti-dumping and anti-subsidy investigations.

KEY TERMS

Normal value: generally considered to be the market price for the product in the exporting country. However, if there are no sales, only a low volume of sales, or if sales are being made at a loss on the home market, the normal value of the product is usually calculated based on the cost of production in the exporting country plus a reasonable amount for selling, general and administrative costs, and profit. Specific rules exist for economies subject to significant distortions.

Material injury: substantial injury to EU industry, e.g. loss of market share, reduced price levels and/or reduced profitability.

Like product: a product which is identical to or closely resembles the imported product under consideration.

Anti-dumping measures: measures imposed on imports of a product that are being sold at a price lower than the normal value of the product and which cause material injury to EU producers.

Dumping margin: the difference between the normal value and the price that the same exporter charges for that product on the EU market (export price).

MAIN DOCUMENT

Regulation (EU) 2016/1036 of the European Parliament and of the Council of 8 June 2016 on protection against dumped imports from countries not members of the European Union (codification) (OJ L 176, 30.6.2016, pp. 21-54)

Successive amendments to Regulation (EU) 2016/1036 have been incorporated into the original text. This consolidated version is of documentary value only.