Antidumping measures imposed by a member of the World Trade Organization are authorized under the Agreement on Implementation of Article VI of the General Agreement on Tariffs and Trade 1994 (the AD Agreement). The AD Agreement establishes substantive requirements that must be satisfied in order to impose an antidumping measure.
The legal basis for antidumping in primary EC law is Article 133 of the EC Treaty and the current EC antidumping legislation in force is the 1995 Basic regulation; Regulation No 384/96 of 22 December 1995. In accordance with this, a definitive measure has been implemented on footwear; Council Regulation (EC) No 1472/2006 of 5 October 2006 imposing a definitive anti-dumping duty and collecting definitely the provisional duty imposed on imports of certain footwear with uppers of leather originating in the People's Republic of China and Vietnam.
The rules concerning antidumping in the EC were adopted in accordance with existing international obligations and especially following Article VI of the General Agreement on Tariffs and Trade, the Agreement on Implementation of Article VI of the GATT (ADA) and the Agreement on Interpretation and Application of Articles VI, XVI and XXIII of the GATT.
The Community rules have been modified in the light of the AD Agreement and it is the EC??s desire to maintain the balance of rights and obligations, which the GATT Agreement establishes and therefore needs to take account of how they are interpreted by the Community??s major trading partners.
The main difference between the WTO and the EC legislation on antidumping, is the special regard to developing countries but no specific action is mentioned. The method of sampling the companies in an investigation are also different from the WTO. Fair comparison is said to be different and many discussions has focused on the issue, but the term is used in both legislations. The EC only exercises the use of the terms Non-Market Economies and Market Economy Treatment.
There exist different views on the economic status amongst EU, US, World Bank etc. This shows that there is no coherence in world trade and that it can convey unfair treatment and that antidumping can be discriminatory.
In the decision on imposing a definitive anti-dumping duty on imports of certain footwear with uppers of leather originating in the People's Republic of China and Vietnam, the EU decided to treat Vietnam as a Non-Market Economy. In an EU antidumping procedure, it is important to establish whether it is a Non-Market Economy or a market economy due to different treatment.
The EC Regulation No 905/98 states that there are certain circumstances that are important when deciding market economy treatment. The governmental or company control, accounting, financing, bankruptcy and property law are all vital areas of concern. State interference and costs of major inputs that substantially reflect market values will be important. The market signals need to reflect supply and demand in order to be treated as a market economy. The firms need to have a clear accounting and the production costs and the financial situation are not to be subjected to significant distortions. Bankruptcy and property laws must guarantee legal certainty and the exchange rate must be carried out on a market rate.
In the EU Basic Regulation, individual treatment can be given when the applicant can show that fore...
