On 11 October 2017, EU ambassadors endorsed the political agreement reached between the presidency and the European Parliament on a proposed methodology for assessing market distortions in third countries.

The new rules will maintain the EU’s capacity to protect its producers against unfair trade practices. They aim at detecting and redressing cases where prices of imported products are artificially lowered due to state intervention.

“International trade can be a crucial source of economic growth, but only as long as everybody plays by the rules. With this new anti-dumping methodology, we will have effective tools to  fight dumping in important sectors such as steel.” said the Estonian minister for trade, Urve Palo, which currently holds the Council presidency.”Our rules are fair, fully in line with WTO requirements and they will apply in the same way to all countries with whom the EU is trading.”

The methodology removes the former distinction between market and non-market economies for calculating dumping. Instead, the Commission will need to prove the existence of a “significant market distortion” between a product’s sale price and its production cost. On that basis, it will be allowed to set a price for the product by referring for example at the price of the good in a country with similar levels of economic development or to relevant undistorted international costs and prices.

The Commission will also draft specific reports on countries or sectors describing distortions. In line with current practice, it will be for EU firms to file complaints, but they will be able to use the Commission’s reports to support their case.

Next steps:

The text endorsed by EU ambassadors will be submitted for formal adoption by the European Parliament and the Council in the coming weeks. It will enter into force on the day following its publication of the regulation in the OJ.

Background:

The Commission proposed targeted amendments to the anti-dumping methodology in November 2016. This specific adaptation to the regulation on trade defence instruments – which is also in process of being reviewed – is  formulated in a country-neutral way and in full compliance with the EU’s WTO obligations.