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EU TRADE POLICY

Eu has a set of measures at disposal of its exporting companies designed to protect them

from inappropriate barriers to their exports

The measures are:

1) Wto dispute settlement mechanism

2) actions against trade barriers

3) defence measures against unfair trade

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EU TRADE POLICY

Eu is consistently making use of the Wto mechanism of dispute settlement

However, Eu never initiates a dispute settlement case before exhausting all other

ways of finding solutions

In Eu experience, the system has, so far, worked well to solve very important disputes

and avoiding 'trade wars'

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EU TRADE POLICY

Eu is fully committed to making the system even more effective, predictable and transparent

The cases tackled by Eu are listed in this internet site: http://trade.ec.europa.eu/wtodispute/search.cfm

Eu suggests some improvements:- permanent members of panel - speeding up the process whenever this is feasible and justified

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EU TRADE POLICY

Since 1995 the Trade Barriers Regulation (Tbr) has given European businesses a tool for tackling trade barriers in export markets

Businesses can use Tbr to ask the European Commission to investigate restrictions on

their sales abroad, discriminatory treatment in foreign markets, difficulty obtaining patents

or licenses or any other form of unfair barrier to their export of goods or services

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EU TRADE POLICY

In the last decade dozens of companies or industries have used Tbr to tackle problems in export markets, as well as unfair foreign trade

practices that cause injury within the Eu internal market

For instance Tbr has helped improve export conditions for carmakers in Colombia,

pharmaceutical products in Turkey, textiles in Brazil and in many other cases

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EU TRADE POLICY

To file a complaint, starting the Eu procedure you have to go to this site:

http://ec.europa.eu/trade/tackling-unfair-trade/trade-barriers/complaints/

A Tbr complaint must demonstrate clearly that there is preliminary evidence that trade barriers or unfair

trading practice contrary to international rules in another country is causing commercial harm to a European company, either within the Eu or in the

importing country

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EU TRADE POLICY

The complaint must show material injury such as financial losses, reduced profit margins, or

a surge in imports or fall in exports

If the complaint is accepted and a Tbr investigation is launched, the Commission

will seek to use bilateral contacts, Wto dispute settlement or other dispute settlement procedures to remove the trade barrier

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EU TRADE POLICY

A Tbr complaint can be filed by:- a Eu business - a Eu industry associations -a Eu member State

Eu encourages companies willing to complain, to contact Eu Trade services

(Market Access Unit of DG Trade) informally before filing a complaint

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EU TRADE POLICY

DG Trade will provide advice on the relevance of the issue and on the best way to

handle the case, and in case a Tbr complaint is to be submitted, Eu officials can provide

assistance

The procedure should not imply any particular costs for the complainant

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EU TRADE POLICY

A complaint must contain the necessary technical information and data to allow the European

Commission to assess whether a Tbr investigation has to be launched

Typical content of a complaint is:1) identification of the complainant and of its activities, including general information on production, turnover and number of employees 2) definition of the goods, services or intellectual property rights affected by the trade barrier

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EU TRADE POLICY

3) data on trade flows in which the complainant is involved as producer, transformer, importer or exporter 4) evidence of the existence of the trade barrier (factual description of the damaging trade practice with a copy, if possible, of all the pertinent legislation or regulations, or its claim letters or faxes from sales agents, importers or clients confirming the existence of the trade practice)

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EU TRADE POLICY

5) indication of how this trade barrier breaches international trade rules (even if complainants do not need to develop a full legal analysis)6) evidence that the trade barrier results or threatens to result in adverse trade effects or injury on Eu market, or a loss of market share or other commercial injury

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EU TRADE POLICY

The defence measures against unfair trade are:

1) anti-dumping

2) anti-subsidy

3) protection against unforeseeable surge of imports

4) information for business

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EU TRADE POLICY

Eu can apply extra duty on imports exported in dumping (according to Wto agreement)

A company is dumping if it is exporting a product at prices lower than the domestic

prices (or the cost of production)

The investigation is started by a Eu producer of the product concerned, issuing a complaint

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EU TRADE POLICY

If it’s the case the Commission opens an anti-dumping proceeding

The maximum time limit for an investigation under these proceedings is 15 months

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EU TRADE POLICY

The investigation must show that:- there is dumping by the exporting producers in the country/countries concerned - material injury has been suffered by the Eu industry concerned - there is a causal link between the dumping and injury found - the imposition of measures is not against the Eu interest (i.e. customers)

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EU TRADE POLICYIf the investigation finds that the above four conditions have been met, then anti-dumping measures can be imposed on imports of the

product concerned

Measures are generally imposed for 5 years

The extra-duties are paid by the importer in the Eu and collected by the national customs

authorities of the Eu countries concerned

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EU TRADE POLICY

Before applying extra-duties exporting producers may offer "undertakings" such as

agreeing to sell at a minimum price

If their offer is accepted (no obligation for acceptance), anti-dumping duties will not be

collected on imports

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EU TRADE POLICY

Eu can apply extra duty on imports subsided (according to Wto agreement) to neutralise

the benefit of a subsidy

A subsidy is "a financial contribution made by (or on behalf of) a government or public

body which confers a benefit to the recipient”

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EU TRADE POLICY

A financial contribution may take different forms:- a direct transfer of funds (e.g. grants, loans, equity injection or loan guarantees) - government revenues (which are otherwise due) not collected (e.g. tax credits) - government provision of goods and services (other than general infrastructure) at low prices- government purchase of goods (at higher prices)- same actions performed by a private body (e.g. a bank) on the instruction of the government

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EU TRADE POLICY

Subsides may distort competition by making subsidised goods artificially competitive (e.g.

cheaper) against non-subsidised goods and thus negatively affecting competitors

In such a situation Eu producers may ask the Commission to intervene by levying

countervailing measures to restore fair competition in the Eu

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EU TRADE POLICY

When an Eu industry considers that imports of a product from a non-Eu country are subsidised and injuring the Eu industry

producing the same product, it can lodge a complaint with the Eu Commission

If the complaint contains evidence of subsidy and injury, the Commission must open an

anti-subsidy investigation

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EU TRADE POLICY

The investigation must show that:

1) the imports benefit from a subsidy

2) there is an injury suffered by the Eu industry

3) there is a causal link between the injury and the subsidised imports

4) the imposition of measures is not against the Eu interest

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EU TRADE POLICY

If investigation is successful extra-duties are impose, but the exporting country may decide

to remove subsides

Measures are normally applicable for 5 years

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EU TRADE POLICY

Safeguard measures can be taken by Eu (according Wto agreement) when Eu industry is affected by an unforeseen, sharp and sudden increase of imports

In such a situation imports (from everywhere) can be stopped, or established a quantitative restrictions on

imports of the investigated product), and an immediate negotiation with Wto (and exporting

countries) has to be activated

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EU TRADE POLICY

In several cases, Eu has imposed tariff quotas allowing imports in excess of the quota, subject to

additional duty

Provisional safeguard measures may last up to 200 days and definitive measures up to 4 years

The objective is to give the industry a temporary breathing space to make necessary adjustments

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EU TRADE POLICY

Before implementing safeguards measure Eu has to show that the increase in imports is:

- sharp - due to unforeseen developments - causing (or threatening) serious injury to domestic industry (a higher level of injury than the material injury required for anti-dumping and anti-subsidy) - safeguards are in the interest of Eu

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EU TRADE POLICY

Information is provided to Eu companies through

- Market Access Data Base (for exporters)

- Export Helpdesk (for importers)

- Dg Trade internet site