Imposing anti-dumping duties on the imports of Chinese ceramic tableware products would represent a protectionist measure, which would negatively affect consumers in the European Union, lawyers representing the Chinese producers in this industry said, on 20 June. At a hearing at the European Commission that same day, they also questioned the methodology used to find evidence of dumping in a case that – depending on the results – may reach the World Trade Organisation.

On 16 February, the European Commission opened proceedings concerning tableware and kitchenware originating in China over allegations of price dumping between 2007 and 2011. According to WTO rules, dumping means exporting a product at a lower price than it is sold on the domestic market.

The opening of the proceedings came after three associations representing ceramic and tableware producers in Europe filed a complaint. The associations were: the European Federation for Table and Ornamentalware, the Association of German Ceramic Producers and the equivalent association in Italy. According to the official Commission document announcing the proceedings, the complainants represent more than 30% of the total Union production of ceramic tableware and kitchenware. However, according to the lawyers representing the China Chamber of Commerce for Import and Export of Light Industrial Products and Arts-Crafts (CCCLA) - in essence the Chinese producers of ceramic tableware - the identity of the companies where the complaint originated from remains unknown.

The Commission document states that the complainants have provided evidence that “the volume and the prices of the imported products under investigation have, among other consequences, had a negative impact on the quantities sold, the level of prices charged and the market share held by the Union industry”.

But the CCCLA and its lawyers argue against these statements. In 2011, the EU imported 476 million kilograms of Chinese ceramic tableware, which is around 67% of the EU’s total consumption, CCCLA said based on Eurostat data. But overall, Chinese import prices increased by 30% during 2007-2011, whereas the production and profitability of European manufacturers has increased by 30% from 2009 to 2011, they claim, also based on Eurostat figures. These data go against allegations of dumping or injury to European producers, they argue.

The lawyers also took issue with the methodology used in the investigation. Since China is considered a non-market economy, Chinese production costs must be compared to the costs in a third-country market economy. The Commission chose Russia.

Konstantinos Adamantopoulos, a partner at Holman Fenwick Willan LLP that represents the Chinese producers, explained that many of the 2,000-odd Chinese businesses that could be affected by the duties are small-sized, mostly family-run, enterprises. This makes it inappropriate to compare them to one single Russian producer, whose identity also remains unknown, he added. He also pointed out that the Russian company also produces ceramic kitchen knives, which should not be included for comparison with the other products.

No matter at what levels Chinese companies set their prices, it is impossible for them to fully avoid accusations of dumping, since their costs will always be compared to those in a third country, Adamantopoulos said.

In a statement the same day, Importers of Ceramics in Europe, a group representing small, medium and large importers in this industry, warned that anti-dumping duties would strongly impact retailers and implicitly consumers. The European DYI Retail Association echoed these thoughts.

Joris Cornelis, the associate at Holman Fenwick Willan LLP who has been in charge of the case, said that “instead of spending time imposing anti-dumping duties on Chinese suppliers, the Commission should spend more time creating a level playing field” for all producers.

“We believe this [would be] a fully protectionist measure and not a right measure,” he said.

The Commission is expected to make a decision regarding the imposition of anti-dumping duties by November 2012. If these measures are adopted, implementation would follow six months later, in May 2013.

CCCLA lawyers say that if this indeed does happen, China is very likely to take the EU to the WTO over this.

Thursday 21 June 2012

By Anca Gurzu

Source: europolitics.info