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Commission Outlines Plan to Extend Trade Defence Instruments to Goods Brought to the Exclusive Economic Zone and Continental Shelf

On 6 March 2018, the European Commission published a proposal on Trade Defence Instruments (TDIs). This Working Paper from the Customs Expert Group recommended three key reforms:

  • First, to apply TDIs to non-EU goods brought to the EU’s Exclusive Economic Zone (EEZ) and continental shelf;
  • Second, to apply TDIs regardless of whether the goods are supplied directly from a non-EU exporter or first stored in the EU and then re-exported to the EEZ or continental shelf;
  • And third, to amend Regulation 2016/1036 (the Basic Anti-Dumping Regulation) and adopt a new “customs tool mechanism”.

This is a largely technical proposal which follows on from the recent political agreement to modernise the EU’s trade defence regime.

The proposed measures are intended to remedy what is considered a gap in the law. Currently, economic operators may import dumped or subsidised products and place them under customs warehousing or inward processing, keep them under temporary storage or in a free zone and finally supply them to the EEZ or continental shelf of a Member State. A customs debt does not incur, as this operation is considered as re-export.

The future inclusion of the EEZ (that is, the zone extending 200 nautical miles from the coastline) and continental shelf means that goods imported to “an artificial island, a fixed or floating installation or any other structure” within that zone will be covered by the EU’s anti-dumping and anti-subsidy rules. The European Commission’s proposal includes an amendment to the Basic Anti-Dumping Regulation to this effect, and notes that the Basic Anti-Subsidy Regulation should be likewise modified.

The proposal does not amend the Union Customs Code. In consequence, a tailor-made ‘customs tool mechanism’ will be required to implement these changes. The proposal therefore envisages a legal act to be adopted by the European Commission which would impose the relevant anti-dumping and countervailing duties on goods imported into the EEZ or continental shelf. This legislation would be separate from the existing EU customs legislation.

The Working Paper is expected to form the basis of more technical discussions within the Commission and among the other EU institutions before any concrete legislative proposal is brought forward.

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