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EU Producers Prepare Anti-dumping Complaint Due to Increased Imports of Wind Towers from Mainland China

Wind tower producers located in mainland China, such as CS Wind China, Sinovel and Titan Wind Energy China, could face an anti-dumping investigation in the EU as a result of increasing concerns by the EU’s domestic producers.

It may be recalled that dumping occurs when a company exports a certain product at a price lower than the price it normally charges on its own home market. Under EU law the following requirements must be met so that the EU Commission can rightfully impose anti-dumping duties on imports of a certain product: (i) there must be dumping by the exporting producers; (ii) material injury must have been caused and suffered by the EU domestic industry concerned; (iii) there must be a causal link or connection between the dumping and injury caused to the EU industry; and (iv) the imposition of measures must not be against the EU interest.

EU domestic producers are reported to be currently holding discussions with the European Commission over filing a complaint so as to achieve the imposition of anti-dumping duties on imports of wind towers originating in mainland China.

Hong Kong traders with export interests in mainland China might be interested in knowing that currently there is a considerable market in the EU for the product that might be subject to this potential investigation. Indeed wind towers – which form the trunks of wind turbines – are imported and used by European companies such as Siemens, Vestas, Nordex and General Electric.

According to EU domestic producers of wind towers, exporters of this product from mainland China have increased their exports to the EU after the imposition of anti-dumping duties on steel plates in February 2017. These anti-dumping measures resulted in the levying of tariffs of 73.7% over the import price of steel plates from mainland China. Chinese steel producers, such as Wuyang Iron and Steel and Nanjing Iron and Steel, were subject to the anti-dumping duties on steel plates.

The duties imposed by the European Commission on steel plates had led exporters of wind towers from mainland China to – allegedly – sell their products at unfairly low prices within the EU. The sales of wind towers by Chinese producers, at what is claimed are artificially low prices, have – apparently – caused injury to the EU domestic industry.

WTO and EU law do not include a timeline within which the domestic producers must lodge the complaint. However, international media outlets have reported that the potential complainants – who at this point remain unknown – are currently gathering the data and information necessary to file the complaint.

If the complaint is indeed lodged and if it contains sufficient evidence that demonstrates that exporters located in mainland China are dumping wind towers onto the EU market and, therefore, causing injury to the EU domestic industry, the European Commission is required to launch the investigation. The European Commission must launch the investigation by publishing a notice of initiation in the Official Journal of the European Union within 45 days after receiving the complaint.

The notice of initiation must contain reference to the: (i) product under investigation; (ii) country/countries subject to the investigation (in this case mainland China); (iii) the rights and obligations of interested parties to the proceeding; and (iv) the deadlines which will apply in the course of the proceeding.

On the date of publication of the notice of initiation, the European Commission is required to send a set of questionnaires containing a request for information to: (i) exporters in the country/countries concerned (in this case mainland China); (ii) producers in the EU; and (iii) importers and users in the EU.

The deadlines for filing the questionnaire responses are set by the European Commission in the notice of initiation. Once it has received the replies to such questionnaires, the data provided therein is verified by the case officers – usually by inspecting records at the company's premises.

The Commission will then make provisional findings. At this point it may: (i) impose provisional duties; (ii) continue the investigation without imposing provisional duties; or (iii) terminate the investigation.

All parties have the right to comment on the provisional findings and receive disclosure of the essential facts and considerations forming the basis for the provisional findings. The European Commission must take due account of the comments received when it continues the investigation.

Finally, the Commission either: (i) imposes definitive measures; or (ii) terminates the case without measures. The definitive findings are disclosed to interested parties and comments are requested before any measures are imposed. The Commission is required to impose definitive measures within 15 months after the initiation of the investigation.

With regard to the potential anti-dumping investigation concerning wind towers originating in mainland China, traders will be informed, in a matter of weeks, whether the proceedings are launched, by the publication of the notice of initiation in the Official Journal of the European Union.

Content provided by Picture: HKTDC Research
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