Thursday

29th Sep 2022

EU to tweak rules on Chinese 'dumping'

  • Beijing. The EU Commission will come out with the official proposals on the new dumping rules later this year (Photo: Bernd Thaller)

The European Commission has tried to fudge the issue of whether China is a “market economy” amid efforts to protect European industry from cheap exports.

Beijing says that under World Trade Organisation (WTO) rules the EU must grant the market economy status (MES) from December onward - 15 years after China joined the trade club.

Read and decide

Join EUobserver today

Become an expert on Europe

Get instant access to all articles — and 20 years of archives. 14-day free trial.

... or subscribe as a group

That risks causing an outcry in EU capitals and in industry, especially the steel sector, because the step would make it much harder for the EU to impose tariffs on state-subsidised Chinese goods.

The college of commissioners held an orientation debate on the issue on Wednesday (20 July).

But instead of taking a position either way, it proposed a third solution - to change the way it calculated whether products were being dumped on the EU market at artificially low prices.

“We should forget this phrase [market economy status]”, commission vice-president Jyrki Katainen said at a press conference in Brussels on Wednesday.

He said the EU would “fulfil our [WTO] legal obligation”, without going into further detail.

But he added that “we should change the way we calculate subsidy or dumping cases, so that we don’t become more vulnerable than we are at the moment”.

He said that would entail changing “the calculation method on dumping and subsidy issues".

In current alleged dumping cases, EU investigators compare Chinese export prices to those of other countries, rather than to domestic prices in China.

That would be illegal if the EU grants China the coveted MES.

Under the EU’s proposed new model, dumping investigations would take into account prevailing international prices, and distortions caused by state interventions.

Trade commissioner Cecilia Malmstroem told press this would mean that: “We are not singling out China. This could go for any country. What we are looking for is whether there are any distortions in a country or even in a sector”.

She added that no matter what the WTO deadlines might say, "China is not a market economy … If it were a market economy, it wouldn't have the problems we are seeing”.

Katainen said the commission’s new approach would result in similar duties to those in place today.

Guy Thiran, director general of Eurometaux, an organisation representing the European non-ferrous metals industry, which had been critical of the commission's approach, said Wednesday that it was too early to tell if the new proposal will lead to effective protection.

Leaders shy away from China market status debate

Leaders are sitting down for the EU-China summit, but the crucial issue of China's market economy status will not be discussed officially. It still dominates industry's thinking on the relationship.

MEPs: China is not a market economy

China should not be granted market economy status, say MEPs. The EU Commission says it is trying to find a solution to defend EU industry.

EUobserved

The EU and China's velvet power

China is pushing its influence through the New Silk Road project and wooing of world media.

News in Brief

  1. EU to ban Russian products worth €7bn a year more
  2. Denmark: CIA did not warn of Nord Stream attack
  3. Drone sightings in the North Sea 'occurred over months'
  4. Gazprom threatens to cut gas deliveries to Europe via Ukraine
  5. New compromise over EU energy emergency measures
  6. 15 states push for EU-wide gas price cap
  7. EU: Nord Stream explosions 'result of a deliberate act'
  8. EU okays €21bn Covid-recovery funding for Italy amid concern

Stakeholders' Highlights

  1. The European Association for Storage of EnergyRegister for the Energy Storage Global Conference, held in Brussels on 11-13 Oct.
  2. EFBWW – EFBH – FETBBA lot more needs to be done to better protect construction workers from asbestos
  3. European Committee of the RegionsThe 20th edition of EURegionsWeek is ready to take off. Save your spot in Brussels.
  4. UNESDA - Soft Drinks EuropeCall for EU action – SMEs in the beverage industry call for fairer access to recycled material
  5. Nordic Council of MinistersNordic prime ministers: “We will deepen co-operation on defence”
  6. EFBWW – EFBH – FETBBConstruction workers can check wages and working conditions in 36 countries

Latest News

  1. Netherlands tops EU social safety net for the poor
  2. New EU rules to make companies liable for their AI failures
  3. Can King Charles III reset the broken Brexit relationship?
  4. Meloni's navy-blockade plan to stop Libya migrants 'unlikely'
  5. Underwater explosions were detected near Nord Stream leaks
  6. EU countries stall new pesticide rules, blame Ukraine war
  7. The UN's Uyghur report must push EU into China sanctions
  8. Russian diamonds ban 'would cost 10,000 jobs', Antwerp claims

Join EUobserver

Support quality EU news

Join us