Massimiliano Di Pace1 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

Massimiliano Di Pace2 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'

Massimiliano Di Pace3 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: Eu suggests some improvements: - permanent members of panel - speeding up the process whenever this is feasible and justified

Massimiliano Di Pace4 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

Massimiliano Di Pace5 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

Massimiliano Di Pace6 EU TRADE POLICY To file a complaint, starting the Eu procedure you have to go to this site: 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

Massimiliano Di Pace7 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

Massimiliano Di Pace8 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

Massimiliano Di Pace9 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

Massimiliano Di Pace10 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

Massimiliano Di Pace11 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)

Massimiliano Di Pace12 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

Massimiliano Di Pace13 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

Massimiliano Di Pace14 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

Massimiliano Di Pace15 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

Massimiliano Di Pace16 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)

Massimiliano Di Pace17 EU TRADE POLICY If 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

Massimiliano Di Pace18 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

Massimiliano Di Pace19 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”

Massimiliano Di Pace20 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

Massimiliano Di Pace21 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

Massimiliano Di Pace22 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

Massimiliano Di Pace23 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

Massimiliano Di Pace24 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

Massimiliano Di Pace25 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

Massimiliano Di Pace26 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

Massimiliano Di Pace27 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

Massimiliano Di Pace28 EU TRADE POLICY Information is provided to Eu companies through - Market Access Data Base (for exporters) - Export Helpdesk (for importers) - Dg Trade internet site