STATEMENT
Free trade. Sustainable trade.
JULY 2015
ACHIEVING TRANSPARENCY IN THE EU’S ANTI-DUMPING REGIME
THE EU ANTI-DUMPING SYSTEM
THE INVESTIGATION AND MEASURES
An anti-dumping investigation is a complex process that takes place over fifteen months during which time
a significant amount of data is collected by the EU Commission from interested parties (e.g. exporters,
importers and EU producers. The information collected is used to determine whether there is dumping
(when the export price of a product is less than the “normal value” (basically, the domestic market price))
and whether that dumping is directly injuring the EU industry. The processes and calculations undertaken
to establish the normal value, dumping, and injury are very complex. If dumping, injury, and a causal link
between the two is found, and the EU Commission decides it is not against the interests of the EU as a whole,
then anti-dumping measures will be proposed to Member States. If they agree, measures (normally ad
valorem duties) are imposed for five years.
CONFIDENTIALITY
The data collected is placed on two files; one confidential to which only Commission officials have access;
one non-confidential which interested parties may access. The latter is supposed to be summarised in
“sufficient detail to permit a reasonable understanding of the substance of the information submitted in
confidence” (WTO Agreement) but invariably is in an indexed form or, more often than not, simply withheld.
THE PROBLEM
The EU system does not permit the independent scrutiny of certain data collected by the EU Commission
during anti-dumping investigations and what is available for scrutiny is lacking in sufficiently detail for those
parties who will ultimately be affected by any eventual measures to verify that the justification for such
measures is fair and accurate. Mistakes in the assessment of data have occurred resulting in incorrect
measures being applied. There are also accusations of data being manipulated to arrive at a desired
outcome. These are extremely difficult to prove – though the EU Court has accused the Commission of
doing so in one example (Dow Chemicals, T-158/10).
THE SOLUTION
THE US APO SYSTEM
The US has used the Administrative Protective Order (or ‘APO’) for more than 35 years. The International
Trade Administration, which investigates dumping, and the International Trade Commission, which
investigates injury, use the system and collect extensive and sensitive information during investigations to
establish whether anti-dumping measures should be applied. However, authorised persons such as lawyers,
consultants or experts acting for interested parties are permitted access to the confidential file provided
that they treat the material as strictly confidential.
Severe sanctions are imposed against any breach of an APO: one can be barred from appearing before the
Commission for up to seven years (also one’s partners, associates, employer and employees); be referred
to the US Attorney and/or the ethics panel of the profession in question; be denied access to confidential
information in the current or future investigations. Breaches are published annually in the Federal Register.
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ACHIEVING TRANSPARENCY IN THE EU’S ANTI-DUMPING REGIME – BRIEFING PAPER – JULY 2015
IMPLEMENTING THE APO SYSTEM IN THE EU
The responsibility for issuing APOs in the EU would be the responsibility of the EU Commission’s Trade
Defence Directorate. The requirements concerning non-disclosure, relevant use, proper storage, and
reporting of abuse would remain unchanged. Applicants would still need to confirm under oath their
authorised applicant status, be bound by the provisions of the APO and acknowledge the possibility of
sanctions for any violations. Finally, the sanctions could be very similar, i.e. disbarment for the offender et
al from practising before the Commission, non-access to BPI in future cases, etc. – together with publication
of the offence in the EU’s Official Journal.
OBJECTIONS (AND RESPONSES)
Certain commentators in the EU Commission and from the EU industry object to the introduction of an APO
system in the EU. The main arguments are:
DISTRIBUTION OF CONFIDENTIAL MATERIAL
The FTA does not believe that a lawyer, consultant or expert would risk reputation and career by doing so.
In the US, between 1993 and 2013 there were an average of nine breaches per year from an estimated 4500
APOs issued each year. In addition, these were almost exclusively minor offences with no instances of the
deliberate distribution of confidential information to a client or competitor of a client.
UNENFORCEABILITY OF SANCTIONS
There would seem to be some doubt as to the possibility to impose sanctions on the legal profession.
However, the FTA fails to see how the legal profession can be exempt from sanctions that are elaborated
within and enforced by EU legislation. Such legislation would certainly apply to individuals outside the legal
profession (i.e. consultants and experts) who would also be permitted to use the APO. Alternatively, the
legal profession could govern itself via codes of conduct that include sanctions for breaches of APO.
Similarly, ethical boards of non-legal professionals could impose sanctions on its members.
USING THE APO WOULD INCREASE COSTS
The FTA is certainly sympathetic in this respect, particularly for SMEs, but considers that those fears are
exaggerated. It is true that the amount of time and effort involved in examining the investigation files would
increase. However, these costs can be controlled by, for example, a maximum cost being agreed upon
between lawyer and client, and/or an agreement that the lawyer examine only certain parts of the file.
SMEs could group together and collectively employ a lawyer to do the work. Alternatively, one may also
employ a consultant or expert to do the work. In addition, if one is a member of trade association – and it
is likely that most SMEs are – one could use the services of an expert within that association. Here, most
likely, there would be no fee for the work conducted; it would be covered by the annual membership fee.
Finally, use of the APO would not be mandatory; one could still take part in an investigation and refer to the
non-confidential file in which respect costs would be the same as they are today.
CONCLUSION
It is clear that the EU’s anti-dumping system lacks sufficient transparency to allow an independent analysis
of the data collected, and the decisions taken on the basis of that data. This places those who are affected
by any measures imposed under that system at a significant disadvantage when defending their interests.
Therefore, an APO system should be integrated into the EU system.
For further information, please contact:
Stuart Newman – Legal Advisor
[email protected]
Phone: + 32 2 741 64 04
www.fta-intl.org
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