On Tuesday 5 December, the negotiators from the European Parliament (led by their rapporteur Christofer Fjellner – EPP, Sweden), Estonian Presidency of the EU Council and Commission reached a political agreement on the draft update of the EU's trade defence instruments (TDI), which was proposed by the Commission in... April 2013!
The changes that have been agreed to the EU's anti-dumping and anti-subsidy regulations aim to adapt the EU's trade defence arsenal to the challenges of the global economy by making the TDI more effective, transparent and easy to use by companies, as well as by allowing the EU to impose higher import duties (in some cases) on products that are dumped.
Under the terms of the agreement that has been concluded, the new rules will shorten the current period of investigation by nine months for the establishment of provisional measures, and will make the system more transparent.
European companies will benefit from an early warning system that will help them adapt to the new situation in case duties are imposed.
Smaller companies will receive assistance from a specific help desk, to make it easier for them to trigger and participate in trade defence proceedings.
In certain cases, the EU will furthermore adapt its 'lesser duty' rule and will be able to impose higher duties on the import of products that are unfairly subsidised or that are dumped and that come from countries where the prices of raw materials and energy are distorted.
Following the example of what was obtained as part of the EU's recently adopted new anti-dumping methodology, the European Parliament obtained the recognition, through the future regulation, of international standards on labour and the environment.
These standards will not be taken into account for the derogations to the 'lesser duty' rule, as the Greens/EFA Groups wanted when it campaigned for this rule not to apply to countries where the social and environmental standards are below the fundamental conventions of the ILO and multilateral agreements on the environment (like the international Paris Agreement on the climate). The standards will, however, be taken into account in the injury margin, which will strengthen the anti-dumping measures.
As part of its annual public report on the EU's TDI, the Commission has also agreed to report on how exporting countries conform with these standards, and on how it has taken account of this in its investigations.
No commitment to a minimum price (like that negotiated in 2013 with China on solar panels) will be possible with third countries that have not ratified the ILO conventions and the international agreements on the environment (like the Paris Agreement).
In addition, the agreement introduces the possibility for the first time for unions to lodge complaints together with industry.
"It took us some time to get here, but today's deal means that the EU will have the necessary tools to tackle quickly and effectively unjust trading practices. Together with the recently-agreed changes to the anti-dumping methodology, the EU's tool box of trade defence instruments is in shape to deal with global challenges", European Commissioner for Trade Cecilia Malmström commented.
"The EU stands for open and rules-based trade, but we must ensure that others do not take advantage of our openness. We are and we will continue to stand up for companies and workers suffering from unfair competition", she added.
"This is the first major overhaul of our trade defence instruments for over 20 years. Together with the new anti-dumping methodology, we have delivered an up-to-date system. The changes made to the trade defence instrument regulation will increase transparency and predictability in our trade defence", Fjellner stated.
He called on the Commission "to apply the new powers in a wise and proportionate way". "Trade defence instruments must never become a tool for protectionism", he underlined.
The new rules to the EU's trade defence arsenal will enter into force as soon as the EU Council and European Parliament have given their definitive green light. (Original version in French by Emmanuel Hagry)