Rarely have buzzwords such as 'sovereignty' and 'autarky' been used alongside the need for a more globalised and collective response to the woes of international trade. Even more rarely even has a (still developing) global health crisis led to such a call to arms. It should come as little surprise, therefore, that the level of uncertainty that has rocked the global trade community this year shows no real sign of abating. Indeed, as a policy paper of the German Economic Institute recently noted: 'The global covid-19 pandemic could either lead to more state interference, decoupling and a marginalization of global trade action or it calls for an unprecedented level of multilateral cooperation.'2 In other words, all options remain on the table. And yet, what appears to be happening is a potpourri of all those situations. Faced with the major humanitarian challenge that is covid-19, more than 130 countries co-sponsored a World Health Organization resolution to intensify efforts to control the pandemic and to lead to equitable access to, and fair distribution of, all essential health technologies and products to combat the virus.3 At the same time, European Union (EU) national governments (and the EU institutions themselves) have been falling over themselves to offer financial incentives to domestic industries;4 even the restrictive state aid regime of the EU has had to succumb to this political direction.5 Those arguably historic inward-looking financial support schemes, through central banks and fiscal actions, are, in the words of the Organisation for Economic Co-operation and Development, 'very significant and likely to have long-lasting and complex effects on management of sovereign and corporate debt'.6
That being said, the practical effects of those measures on trade with, and by, the EU, are not yet apparent at the time of writing. So, while undoubtedly colouring the 'working environment' of EU trade practitioners during the first half of 2020, the developments that took place until then were still largely untouched by the global health worries brought about by covid-19. In taking stock of those developments, this chapter, therefore, has regard to both the closed books that 2019 wrote and the developing circumstances that the first half of 2020 has brought about (and continues to shape).
II LEGAL FRAMEWORK
The EU's trade defence investigation (TDI) legislation was not subject to any changes in 2019.
In respect of anti-dumping and anti-subsidy, current legislation comprises Regulation (EU) 2016/10367 (the basic Anti-Dumping Regulation) and Regulation (EU) 2016/10378 (the basic Anti-Subsidy Regulation). In 2018, these Regulations were overhauled substantially by the adoption of Regulations (EU) 2017/23219 and 2018/825.10 As explained in previous editions of this book, the former introduced a new methodology applicable to normal value calculations, regardless of origin, whereby domestic prices and costs are established to be significantly distorted because of state intervention, while the latter modernised the EU's TDI for the first time since 1996.
Similarly, safeguard measures in the EU continue to be governed by Regulation (EC) 2015/478,11 which concerns the rules on imports from World Trade Organization (WTO) Members, and Regulation (EU) 2015/755,12 which applies to imports from non-WTO Members. No changes to these Regulations resulted from the above-mentioned legislative developments.
III OVERVIEW OF TRADE DEFENCE INSTRUMENTS
Statistics show 94 definitive anti-dumping measures, 15 countervailing measures in force and three safeguard measures in 2019.13 This is an increase of seven measures as compared with the previous year, when 93 definitive anti-dumping measures and 12 countervailing measures were in force. Thus, 2019 was a particularly busy year, with an increased level of new casework and reviewing activity as compared with 2018. In fact, in 2019, the European Commission (the Commission) initiated 16 new investigations, eight expiry reviews, two interim reviews, and seven reinvestigations and reopenings. The Commission also increased its efforts to enforce measures, in particular, by initiating four anti-circumvention cases and one anti-absorption investigation.14
China remained the country most affected in 2019, accounting for 68 per cent of all anti-dumping and anti-subsidy measures; specifically, it was subject to 86 anti-dumping measures and seven countervailing measures. China is followed by Russia, India and the United States as the main countries subject to anti-dumping and anti-subsidy measures.15
Several noteworthy investigations concluded or under way in 2019 and early 2020 deserve a mention.
i Steel safeguard investigation and reviews
During the past year, the Commission continued its support of the European steel industry, tackling the challenges of global steel overcapacity. As reported in last year's review, definitive measures in steel safeguard investigation were adopted on 31 January 2019.16 Those measures concerned 26 product categories and took the form of an erga omnes tariff-rate quota, so that imports of the product categories concerned above a particular quantitative threshold17 are subject to a 25 per cent duty (or tariff rate quota (TRQ)). In line with its obligations under WTO law, the measures were imposed for three years18 against imports from all countries except Botswana, Cameroon, Fiji, Ghana, Ivory Coast, Lesotho, Mozambique, Namibia, South Africa, Eswatini (Swaziland) and the European Economic Area Member States.19 When imposing definitive safeguard measures, the Commission committed to reviewing them regularly and adjusting the level or allocation of TRQs if there is a change of circumstances.
a The level and allocation of the TRQ for product category 1 (hot-rolled flats) was adjusted by the imposition of a 30 per cent cap on the imports of any individual country (per quarter) with a view to preserving traditional trade flows in terms of origin.
b Product category 25 (large welded tubes) was changed from country-specific to a single global TRQ. This was because, on the one hand, Russia had largely underused its country-specific TRQ as the major gas pipe project (Nord Stream 2) was in its last stages, and, on the other hand, other supplying countries for this product category had fully exhausted their country-specific TRQ.
c Imports under category 4B were placed under the end-use procedure referred to in Article 254 of Regulation (EU) No. 952/201322 to demonstrate that they are used for the manufacturing of automotive parts. However, that requirement was subsequently removed by Regulation (EU) No. 2020/35,23 with retroactive effect, since the system did not function as originally expected and imports under product category 4B were disrupted.
d As to crowding out of traditional trade flows, in respect of product categories 13 and 16, the Commission imposed, in the last quarter of a given period, a cap of 30 per cent of the residual tariff-rate quota. Thereby, it sought to ensure that traditional import volumes from smaller exporting countries were preserved.
e The Commission concluded that the definitive measures did not limit the ability for the Western Balkan countries (with whom the EU concluded 'stabilisation and association agreements') to export steel to the EU. Therefore, there were no potentially detrimental effects in achieving the integration objectives pursued with these preferential trading partners.
f The list of developing WTO Members excluded from the scope of the measures was reviewed, based on the most recent and consolidated data available at the time of the investigation (i.e., data for 2018). As a result, imports of some product categories of certain developing countries became subject to the measures and others were excluded.
g Although facing opposition to its plans, the Commission lowered the liberalisation rate from an initial 5 per cent per year to 3 per cent for the second and third period of measures. This was considered in line with the recently published general economic and industrial outlooks, which predict a growth reduction for the EU and the world economy.
On 14 February 2020, the Commission initiated the second review of steel safeguard measures 'to take account of possible developments and changed circumstances before the end of the second year of imposition of measures'.24 The scope of that second review was the same as for the first review. Notably, owing to the global spread of covid-19, the Commission exceptionally reopened the written stage of the proceedings to assess what effect the pandemic had on the measures concerned, and how it had affected the functioning of the EU and the global steel market.25
This move was initiated after submissions by EUROFER and ESTA, the associations of European steel and tube producers, which requested the Commission to:
a reduce the TRQ quantities by 75 per cent for Q2 and Q3 2020;
b review the approach to be taken for Q4 2020 and for 2021 later in the year;
c introduce quarterly TRQs, including removing the carry-over mechanism;
d lower per country caps to avoid import surges given the volatility in demand; and
e liberalise the measures via the out-of-quota tariff.
Needless to say, that request was strongly opposed by exporters, importers and users.
On 29 May 2020, the Commission notified the WTO of its proposal for adjustments to the definitive steel safeguard measures. It rejected the controversial request to reduce the TRQ quantities, and proposed two general adjustments to the TRQs administration, namely (1) quarterly management of all country-specific quotas, and (2) the introduction of a refined access regime for access to the residual quota of countries benefiting from country-specific quota. Depending on the circumstances (and with the exception of the special cases of product categories 1, 4B, 8 and 25A), access to the residual quota in the last quarter of a period for those countries would be prohibited, limited or permitted. The Commission also updated the list of developing countries potentially excluded from the scope of the measures based on updated import statistics, and left unchanged the pace of liberalisation at a 3 per cent increase for the period from 1 July 2020 to 30 June 2021. Finally, the Commission proposed to hold consultations with those WTO Members having a substantial interest as exporters of the steel product via videoconference during the period from 1 June 2020 to 11 June 2020. It remains to be seen what the final outcome of this review will be.
ii Biodiesel from Argentina and Indonesia
In 2019, the two biodiesel investigations into imports from Argentina and Indonesia were concluded. The anti-subsidy investigations into imports of biodiesel originating in Argentina resulted in definitive measures on 12 February 2019,26 coupled with an undertaking subject to a quantitative limit for eight Argentinean producers and the Argentinean Chamber of Biofuels.27
On 28 November 2019, the Commission imposed anti-subsidy measures on imports of biodiesel from Indonesia.28 In its findings, the Commission partially relied on facts available regarding the existence and the extent of the alleged support granted to the biodiesel industry. The definitive countervailing duty corresponded to the total amount of countervailable subsidies established by the Commission. The duty rates were set between 8 per cent and 18 per cent, respectively. One of the exporting producers made an offer for a price undertaking; however, this was refused by the Commission as impractical (pursuant to Article 8 of the basic Anti-Dumping Regulation, that any 'impractical' undertaking offer may be rejected).
Nevertheless, the biodiesel saga, which dates back to 2012 when the Commission first commenced anti-subsidy and anti-dumping investigations against imports of Indonesian and Argentinean biodiesel,29 appears to be far from over. In March 2020, several Indonesian biodiesel producers filed actions for annulment, challenging the measures introduced before the General Court of the European Union (GC).30 The outcome in those cases will be covered in a future editions of this review.
iii Stainless steel sheets and coils from China and Indonesia and continuous filament glass fibre products from Egypt
Last year's review featured the anti-subsidy investigation into imports of certain woven and stitched glass fibre fabrics (GFF) from China and Egypt.31 As explained then, the novelty of that case lay in its claim that 'some of the subsidies are directly granted by the Government of Egypt, and some indirectly by the Government of China, but via the Government of Egypt'.32 Although the case has been concluded, on 7 June 2019 and 10 October 2019, the Commission initiated new anti-subsidy investigations into, inter alia, alleged Chinese subsidies outside China. These investigations concern (1) imports of continuous filament glass fibre products (GFR) originating in Egypt,33 and (2) imports of certain hot-rolled stainless steel sheets and coils (SSHR) originating in the China and Indonesia, respectively.34
In all three cases (GFF, GFR and SSHR), the Commission is faced with the difficult task of proving, inter alia, the existence of subsidies granted by the Chinese government to Chinese-owned producers in the host state.35
Generally speaking, the issue of 'transnational' subsidies, as those types of financial incentives are also referred to, is one of the most controversial and current issues in EU anti-subsidy law. And yet, in a certain sense, that development is merely tackling the business reality of some sectors and territories, particularly in light of China's One Belt One Road initiative. Indeed, as Crochet and Hegde have noted, the 'fact that a government finances a firm which is not under its jurisdiction is not unrealistic anymore'.36 At least the position of Crochet and Hegde is that the wording of the WTO Agreement on Subsidies and Countervailing Measures (the SCM Agreement) prevents this type of financing from being disciplined by means of anti-subsidy measures.37
That interpretation appears not to have been shared by the Commission as one can observe from the definitive determinations made in GFF, published on 15 June 2020.38 Therein, the Commission attributes to Egypt subsidies granted by China to an Egyptian entity (through the latter's Chinese parent company) by making use of Article 31(3)(c) of the Vienna Convention on the Law of Treaties and Article 11 of the International Law Commission Articles on the Responsibility of States for Internationally Wrongful Acts to tiptoe around the thorny issue of territorial restrictions on what may be attributed to which government under the SCM Agreement.39 Countervailing duties vary from 17 per cent to 30.7 per cent on imports of GFF from China, and 10.9 per cent on imports from Egypt.40
GFF thus provides clues on the directions the Commission may take in similar cases. In fact, an association of EU producers of GFF referred to the conclusion of this case as 'a new era for protecting EU manufacturing from unfair third country government subsidies'.41
iv GFF from China and Egypt (dumping) and the new anti-dumping methodology
The parallel anti-dumping investigation into GFF from China and Egypt was concluded on 1 April 2020 with the imposition of anti-dumping duties.42 The level of duties for three Chinese companies probably represents a record in EU TDI history (i.e., 99.7 per cent).43 By contrast, exports from Egypt attracted a 20 per cent anti-dumping duty. The companies targeted were Egyptian subsidiaries of two of the Chinese companies that face the top rate from China. The lesser duty rule was applied. To avoid double-counting, the anti-dumping duty levels were amended on 15 June by way of the Regulation imposing definitive countervailing duties on imports of GFF.44
This case is one of the first examples of the new anti-dumping methodology for establishing normal value in the event of significant distortions in the market of an exporting country that render the use of domestic prices and costs in that country inappropriate. In practice, China is the main target of the new methodology. The sources that are used in the construction of the normal value include (1) costs of production and sale from a representative country of similar economic development, (2) undistorted international prices, costs and benchmarks, and (3) undistorted domestic costs.45 So far, the Commission has resorted to selecting a representative third country for the construction of non-distorted normal value in the new investigations concerning imports of GFF, SSHR and steel road wheels,46 and also in the expiry reviews regarding imports of malleable tube fittings,47 ceramic tableware and kitchenware,48 aluminium foil,49 organic coated steel products,50 tungsten electrodes,51 peroxosulphates,52 bicycles,53 ironing boards54 and ferro-silicon.55
The usual criteria for selecting the representative country are the following:
a a level of economic development similar to the exporting country. For this purpose, the Commission used countries with a gross national income (GNI) similar to the exporting country according to the database of the World Bank. Usually, the countries selected are at the same income level as China (typically the exporting country in such cases), namely 'Upper Middle Income', according to the World Bank. It is not required that the representative country has a similar GNI to the exporting country, but rather that it has a similar level of economic development. Thus, the fact that a country may have a closer GNI than another cannot be a decisive factor in the selection of the appropriate representative country if it is in the same category of countries with a similar level of economic development as the exporting country;
b production of the product under review in that country;
c availability of relevant public data in that country;
d if there is more than one possible representative country, preference is given, where appropriate, to the country with an adequate level of social and environmental protection.
Thus far, Turkey has been the most frequently selected representative country (in six of 11 cases),56 followed by Brazil (two of 11 cases). In other cases, Mexico, Serbia and Thailand were selected as the representative countries.
v Urea from Russia, Trinidad and Tobago, and the United States
On 8 October 2019, definitive measures in the form of fixed duties per tonne57 were imposed on imports of mixtures of urea and ammonium nitrate originating in Russia, Trinidad and Tobago, and the United States.58 In imposing provisional and definitive duties against Russia, the Commission, for the first time, 'modulated' the lesser-duty rule (that is, disapplied that rule) owing to the provisionally determined distortions in raw material (gas) prices in Russia.59 The Commission explained that the latest amendments of the basic Anti-Dumping Regulation changed the modalities of the lesser duty rule's application, as in cases where there are raw material distortions under Article 7(2a) of the basic Anti-Dumping Regulation the dumping margin is considered to reflect the injury suffered by the EU industry. That investigation, too, has been challenged before the GC, particularly as regards the disapplication of the lesser-duty rule.60
IV LEGAL AND PRACTICAL DEVELOPMENTS
In this section, we summarise briefly the developments of interest to practitioners of international trade law that have not been covered in previous sections.
i Terms of reference of the hearing officer
The year 2019 was uneventful in terms of substantial legislative changes in the area of TDI. As reported in previous editions of this review, the EU's TDI framework underwent major changes to the basic Anti-Dumping and Anti-Subsidy Regulations that were introduced through Regulations (EU) 2017/2321 and (EU) 2018/825. As a result of these reforms, the role of a hearing officer is now firmly embedded in the basic Anti-Dumping Regulation and the basic Anti-Subsidy Regulation.
In February 2019, the specific function and terms of reference of the Hearing Officer were updated to reinforce the transparency and effectiveness of trade proceedings and confirm the independent status of the Hearing Officer.61 In particular, a clearer explanation for interested parties on the role and powers of the Hearing Officer was provided. Furthermore, it was clarified that the task of the hearing officer would be to safeguard the effective exercise of the procedural rights of the interested parties provided for in the various regulations,62 including the rules applicable to anti-dumping, anti-subsidy, and safeguard investigations. The main principles of the terms of reference remained unchanged, but several amendments were introduced in line with the reform of the EU TDI legislation to take account of shortened deadlines for completing the investigations. Of greatest importance might be the new possibility of the Hearing Officer to reject requests for a hearing in certain circumstances. That simple procedural safeguard had not been present in previous terms of reference, so that the Hearing Officer was, in effect, required to accept every single hearing intervention request. Thus, (i) requests for intervention of the Hearing Officer should be submitted in good time bearing in mind the time constraints of the proceedings and at the earliest possible time following the occurrence of the event justifying such intervention;63 (ii) hearings with the Hearing Officer should in principle only take place if the issues could not be settled with the Commission services in due course; (iii) and hearing requests (with certain exceptions) should be made within the relevant timeframes set for the procedure.64 A request falling outside those requirements will allow the Hearing Officer, by means of a decision, to reject the request concerned. Naturally, said decision makes for a challengeable act before the Union Courts pursuant to the fourth paragraph of Article 263 of the Treaty on the Functioning of the European Union (TFEU).
ii Procedural framework for imposition of measures to the continental shelf and exclusive economic zone of Member States
As explained in last year's review, part of the overhaul of the basic Anti-Dumping and basic Anti-Subsidy Regulations led to the introduction of provisions that would allow the Commission to impose anti-dumping and anti-subsidy measures not only for the customs territory of the EU, but also for the 'Treaty territory' of the Union.65 Regulation (EU) 2019/113166 of 2 July 2019 puts in place the necessary legal framework (referred to as the 'customs tool') to make use of that new extension of the application of anti-dumping and anti-subsidy measures: it provides for instructions and information to the customs authorities of the Member States on how imports and exports from and to their continental shelf and exclusive economic zones should be handled in practice. This is part of the 2018 TDI modernisation exercise and aligns EU policy with that of other trading partners, such as the United States, Brazil and India.67 Applicable since November 2019, Regulation (EU) 2019/1131 is yet to see its first use.
iii Phil Hogan as new Commissioner for Trade and his transparency agenda
On the practical side, since Phil Hogan took up his role as the new Commissioner for Trade at the end of 2019, the Commission increased its activity in TDI investigations. Of the 38 initiations in 2019,68 the Commission initiated eight in December 2019.
Those investigations (mostly targeting China) concerned a variety of products, such as bicycles and other cycles, citrus fruits, continuous filament glass fibre, cast iron articles, pins and staples, sulphanilic acid and tungsten electrodes, and included:
a a reopening of the anti-circumvention investigation concerning imports of bicycles and other cycles, extending the definitive anti-dumping duty to imports from Indonesia, Malaysia, Sri Lanka and Tunisia;69
b an expiry review of the anti-dumping measures on citrus fruits from China;70
c a new exporter review regarding bicycles from China;71
d an expiry review of the anti-subsidy measures on imports of continuous filament glass fibre from China;
e an anti-absorption investigation concerning imports of certain cast iron articles from China;72
f an anti-dumping proceeding into pins and staples from China;73
g an expiry review of the anti-dumping measures on imports of sulphanilic acid from China;74 and
h a possible circumvention of the anti-dumping measures on imports of tungsten electrodes from China.75
This increased activity is not surprising given that Commissioner Hogan has publicly voiced his support for the full use of TDI, but also to strengthen the TDI toolbox, 'including rules that allow [reaction] to illegal discriminatory trade measures by third countries',76 and addressing unfair trading practices by China.77
In February 2020, Commissioner Hogan also announced a new transparency package,78 which will bring about the publication of (1) Commission decisions authorising Member States to conduct bilateral investment negotiations, (2) non-business sensitive summary records from the meetings of the Trade Defence Instruments Committee, and (3) Commission recommendations for negotiating directives, not only for preferential trade agreements, as this is already the case, but also for non-preferential ones. Commissioner Hogan also confirmed that the Commission's initiative to publish documents released under Regulation (EC) No. 1049/200179 (known as the Access to Documents Regulation) will apply equally to trade-related documents.
iv The EU's Chief Trade Enforcement Officer
In July 2019, Ursula von der Leyen, the Commission's President, proposed the establishment of a new role within the Commission to monitor the EU's trade agreements. That position was officially created on 12 December 2019. Referred to as the EU's Chief Trade Enforcement Officer, that role would be tasked with monitoring and enforcing the environmental and labour protection obligations of EU free trade agreements (FTAs) with third countries.80
While few details are available as yet, the Commission proposed to amend the existing Trade Enforcement Regulation81 just days after the WTO Appellate Body was reduced to only one member when the term of the two other members lapsed (see Section IV.ix, below, for further discussion). The current Trade Enforcement Regulation (a basis under EU law for adopting trade countermeasures) requires that a dispute go all the way through the WTO procedures, including the WTO Appellate Body, before the EU can retaliate by way of trade sanctions. The lack of a functioning WTO Appellate Body would hence allow WTO Members to avoid their obligations and escape a binding ruling by simply appealing a panel report. The proposed amendment to the Trade Enforcement Regulations would allow the EU to retaliate in situations where dispute settlement procedures are blocked, that is to say when the WTO is prevented from delivering a final ruling at the appellate level because the other party to the dispute blocked the dispute settlement procedure by appealing 'into the void'.
v Continued increase in investigations into steel products
In 2019, the Commission continued to focus on investigations in respect of steel products. In fact, during the past year, half of the new anti-dumping and anti-subsidy investigations also concerned iron and steel products.82 Importantly, as noted above, the definitive safeguard measures were imposed on certain steel products on 31 January 2019. The first review concluded on 26 September 2019, with the second review continuing.
vi Extensive use of the anti-circumvention instrument
Since the last edition of this review, the Commission also increased its activity in respect of anti-circumvention investigations, inter alia, by passing through other exporters or through other countries. To this end, four anti-circumvention investigations were initiated, including one into tableware and kitchenware from China, extending duties to 30 more companies.83 In terms of resources, this investigation represents the Commission's largest anti-circumvention proceeding initiated so far. The Commission investigated 50 Chinese producers, and 20 Commission investigators carried out on-the-spot verifications at about 40 Chinese companies.84 This is in line with the Commission's policy of protecting small and medium-sized enterprises, as many EU ceramics producers are small businesses. That push also gains traction against the background of the recent judgment in Kolachi, which confirmed the Commission's powers to also tackle circumvention practices involving more than two countries.85
vii Covid-19 repercussions
'If Covid-19 were to be a tariff, it would be equivalent to a 3.4% global tariff on trade. It may not sound much but it is significant when you realise that more than half of all EU import tariffs are less than 2%.'86 The Commission's latest reports on the effects of the newcoronavirus on EU trade predicts that, in 2020, global trade will decrease by between 10 per cent and 16 per cent, while for the EU the reduction may be '9%-15% for extra-EU27 exports and 11%-14% for extra-EU imports (goods and services combined)'.87 The report also points out that any current estimations may easily become outdated, given the volatile situation that the pandemic is causing. It is equally difficult, therefore, to formulate any trade projections for 2021 and following years.
Additionally, covid-19 had a negative effect on the TDI activity at the beginning of 2020, even though 2019 saw a rise in the use of TDI (as compared to 2018). To tackle that exceptional situation, the Commission published a notice on the consequences of the covid-19 outbreak on anti-dumping and anti-subsidy investigations.88 It had similarly done so during the spread of SARS in Asia. Arising from the consequences of covid-19, and until ordinary sanitary circumstances are restored, the Commission thus suspended its verification visits at the premises of the companies concerned and instead is assessing the information submitted by parties on the basis of a 'desk analysis', that is to say by cross-checking the information received with other available resources. If that information is inaccurate or incomplete, the Commission will base its findings only on verified or other proven facts on the record of the investigation.
The Commission also noted that it was ready to grant extensions for deadlines, where justified, and rely on written submissions. Although, if these longer extensions risk jeopardising the timely conclusion of an investigation, the Commission explained that it may reject the extension requests or shorten the time granted. Additionally, once the situation with covid-19 is 'resolved', the Commission noted that it will initiate an ex officio review of any TDI measures based on data that could not be fully verified because of the covid-19 circumstances and to adjust them if appropriate. That is likely to entail a significant investigative burden for 2021.
It remains to be seen what the ultimate effect of the pandemic will be on the conduct of investigations.
vii Developments in the EU's trade and economic partnerships
The EU's new generation FTAs include both commitments on liberalisation of trade in goods, as well as commitments on services and investments, public procurement, competition and subsidies, and regulatory issues. These agreements aim to develop stronger rules-based and values-based trade regimes with the EU's trading partners and include specific provisions on trade and sustainable development.
A noteworthy development in the area of EU FTAs took place on 22 May 2018. Following the European Court of Justice's (ECJ) opinion on the division of competences between the EU and its Member States for the conclusion of the EU-Singapore FTA,89 a new approach towards trade negotiations was adopted by the European Council (the Council).
More specifically, the Council focused on the following issues:
a the Commission's intention to recommend splitting the agreement into two, one relating to investment (which would require approval by the EU and all its Member States), and one relating to all 'other' provisions, which could be adopted by the EU only as 'exclusive competences' of the EU, without the need to pass by national parliaments; and
b the Council's role in trade negotiations, in particular its involvement throughout all the stages of the negotiating process, and the importance of working to reach consensual decisions.
Furthermore, in its recent overview of the EU's 35 largest preferential trade agreements,90 the Commission highlighted, inter alia, the following trends:
a The EU's recent trade agreements help companies to access new markets by eliminating tariffs, easing administrative procedures and providing greater coherence on standards and rules for goods and services.
b EU trade agreements set up committees and working groups where the parties can raise any issue they have with the way commitments are implemented.
c Progress was made on removing trade barriers for EU exporting companies and steps were taken to improve the business environment.
d Progress was made with implementing provisions on labour rights, environmental and climate protection, and legal enforcement actions taken under EU trade agreements.
e Implementation of the trade and sustainable development chapters of FTAs has been enhanced.
f All the EU's new trade agreements include provisions for protecting geographical indications.91
Moreover, on 30 June 2019, the EU signed an FTA and an investment protection agreement (IPA) with Vietnam. The Council adopted a decision on the conclusion of the FTA on 30 March 2020.94 However, the IPA will need to be ratified by all Member States according to their respective national procedures before it can enter into force.
Described as 'the most ambitious free trade agreement ever concluded with a developing country',95 it provides for almost complete elimination of tariffs between the two parties, reducing regulatory barriers and overlapping red tape, ensuring protection of geographical indications, opening up services and public procurement markets, and making sure the agreed rules are enforceable. Importantly, the FTA includes commitments to implement International Labour Organization core standards and certain United Nations conventions, some of which Vietnam already took steps to implement.96 Additionally, the agreement also deals with issues of protection of intellectual property, labour rights and sustainable development.
Furthermore, in April 2020, the EU concluded negotiations for a new trade agreement with Mexico. The legal draft was finalised before undergoing translation into all EU languages and transmitted for signing and conclusion to the Council and European Parliament.97 Remarkably, Mexico is the EU's number one trading partner in Latin America, with bilateral trade in goods worth €66 billion and trade in services worth €19 billion. Under the new agreement, practically all trade in goods between the EU and Mexico will be duty-free. It is also the first time that the EU has agrred with a Latin American country on issues concerning investment protection. Importantly, this global agreement with Mexico goes beyond trade and includes progressive provisions on issues such as sustainable development, human rights and fighting corruption.
Currently, negotiations are also under way for trade agreements with Australia, New Zealand, Chile, China and Indonesia.98 Importantly, an EU-China Investment Agreement is also on the table with an ambitious (pre-covid-19) goal of concluding it by the end of 2020.99 Whether that schedule holds remains to be seen. Moreover, in October 2019, the Council of the European Union adopted conclusions on Thailand which, inter alia, stressed the importance of taking steps towards the resumption of negotiations on an ambitious and comprehensive FTA with Thailand.100
viii Brexit and the UK transition reviews
There have been several important developments in respect of Brexit since the last review. On 24 January 2020, the Withdrawal Agreement101 was signed by the EU and the UK's official representatives. On 31 January 2020, at midnight (Brussels time), the UK officially withdrew from the EU.
The Withdrawal Agreement entered into force on 1 February 2020, marking the start of a transition period (or an implementation period, as the UK calls it), which should end on 31 December 2020. It can be extended once by up to one to two years. Any decision about an extension needed to be taken jointly by the EU and UK before 1 July 2020.102 Currently, however, it is not unlikely that the transition period will be extended because of the outbreak of the new coronavirus.
During the transition period, the UK will remain in both the EU Customs Union and the Single Market. This means that any new EU trade measures entering into force during the transition period will also apply to the UK. However, the UK will no longer have a say in their adoption. While still applying EU trade law, the UK, as an independently represented WTO Member, is also expected to implement its independent WTO obligations during the transition period.
Additionally, during the transition period, the UK will continue to be bound by the EU's FTAs with third countries. The UK can also negotiate trade agreements with third countries independently from the EU, but those will only enter into force after the end of the transition period.
The core legislation comprising the UK's TDI framework includes (1) the Trade Bill 2019-2021 introduced on 19 March 2020 and currently progressing through the UK Parliament, (2) the Taxation (Cross-border Trade) Act 2018, (4) the Trade Remedies (Dumping and Subsidisation) Regulations and the Trade Remedies (Increase in Imports Causing Serious Injury to UK Producers) (EU Exit) Regulations 2019, both entering into force on 6 March 2019, and (4) the Trade Remedies Investigations Directorate (TRID) dumping, subsidisation and safeguarding investigations guidance, describing the processes and methodology that TRID currently uses to conduct reviews and make preliminary decisions.103
As noted in the previous edition of this review, before the Trade Bill enters into force and the Trade Remedies Authority is fully operational, the TRID104 is carrying out the function of the UK's trade investigating authority. Presently, it is carrying out various transition reviews.105
The TRID launched a Call for Evidence106 consultation with interested parties107 to be able to assess which of the existing EU anti-dumping and anti-subsidy trade remedies are of interest to the UK. As a result, 63 anti-dumping and countervailing measures that did not meet the criteria will no longer apply at the end of the transition period and 44 anti-dumping and countervailing measures will be maintained.108
In general, all transition reviews should be initiated before the date the EU measure is due to expire.109 If a review is not initiated before the expiry date, then the measure will expire110 and the EU measure cannot be reinstated subsequently. The EU measures will be maintained by the UK at the level initially set by the Commission until the completion of the transition reviews. In practice, this means that the EU measures could be applied in the UK for a number of years without any specific investigation.
The TRID intends to review the 44 maintained measures in order of priority (i.e., focusing first on the EU measures due to expire during the transition period or shortly thereafter).111 During the transition review process, the TRID will consider whether (1) the continuation of measures is necessary to offset the dumping or subsidisation of the relevant imported products into the UK, and (2) there would be injury to the relevant UK industry112 if the measures were no longer to apply to those products.113 The TRID will recommend to the Secretary of State (who makes the final decision) whether the maintained measures should continue and at what level.114
In other words, by the end of the transition reviews, the measures will either become UK-specific or will no longer apply in the UK. If the TRID concludes that the measures are necessary but is not able to calculate their appropriate level, it should propose to maintain the EU measures level.
At the time of writing, the TRID had already initiated two transition reviews: (1) transition review No. TD0001 on anti-dumping duties on certain welded tubes and pipes of iron or non-alloy steel originating in the Republic of Belarus, the People's Republic of China and the Russian Federation, initiated on 10 February 2020; and (2) transition review No. TS0002 on countervailing duties on imports of certain rainbow trout originating in Turkey, initiated on 4 March 2020. The UK government accepts that, in some instances, the TRID will not be able to meet the timeline set out for the transition reviews.
It is possible that TRID's work will be affected by potential requests for an interim review initiated by exporters challenging aspects of the measures not covered by the transition review, or by challenges of the transition of EU measures into UK measures without full reinvestigations in accordance with WTO rules.115
ix Demise of the WTO Appellate Body, and the new Multi-Party Interim Appeal Arbitration Arrangement
On 10 December 2019, the WTO Appellate Body went into crisis as the mandate came to an end for two of its three remaining members. This meant that the WTO Appellate Body went into paralysis for want of a majority of its seven members to hear a particular case and left a void where the second of the two-tier dispute settlement body once stood.
The new Multi-Party Interim Appeal Arbitration Arrangement (MPIA) seeks to fill that void. Signed at the time of writing by the EU and some other 20 countries, the MPIA mirrors the usual WTO appeal rules and can be used between any WTO Members willing to join as long as the WTO Appellate Body is not fully functional.116 That will allow Members to that interim arrangement to solve trade disputes among themselves.
On 30 April 2020, the MPIA was notified to the WTO.117 At the time of writing, three sets of agreed procedures for arbitration under the MPIA were notified to the Dispute Settlement Body. Those cases concern DS537: Canada – Sale of Wine, DS524: Costa Rica – Avocados and DS522: Canada – Aircraft. It is expected that more cases will follow suit.
x Foreign Direct Investment Screening Regulation
Regulation (EU) 2019/452118 (the Foreign Direct Investment Screening Regulation) was published on 19 March 2019 and entered into force on 10 April 2019. It will be fully applicable from 11 October 2020. The objective of the Foreign Direct Investment Screening Regulation is to put in place the first EU common framework for screening foreign direct investment (FDI) into Member States' territories and within the EU. The key features of the Regulation are that it:
a creates a cooperation mechanism between the Commission and Member States to exchange information and raise concerns relating to specific investments;
b grants the Commission certain powers to issue non-binding opinions (1) if an investment poses a threat to the security or public policy of more than one Member State, or (2) if an investment could undermine projects of interest to the whole EU (such as Horizon 2020). Important here is that the Commission will not be given the power to block transactions;
c allows Member States to provide comments to other Member States reviewing an investment when they consider that the investment will affect their security or public policy. The reviewing Member State must give 'due consideration' to any such comments. Member States may even provide comments if the Member State in which the investment takes place is not conducting a screening;
d provides for a non-exhaustive list of factors that could trigger a screening process on the grounds of security or public policy (this list concerns, inter alia:
• critical infrastructure;
• critical technologies and dual-use items;
• critical inputs (such as energy or raw materials);
• access to sensitive information; and
• media freedom and pluralism; and
e puts in place certain basic requirements for Member States who choose to introduce a screening mechanism at national level.
So far, only 13 Member States have national investment screening mechanisms in place.119
On 10 March 2020, the Commission stated in a communication titled 'New Industrial Strategy for Europe'120 that it would seek to further reinforce its industrial and strategic autonomy through the strengthening of the framework for FDI screening. Going forward, this may mean that the Commission at least pursues the intention to further strengthen the Foreign Direct Investment Screening Regulation and make screening of FDI more strategic, particularly given that the Commission also voiced on 25 March 2020121 the need for Member States to use national FDI screening tools to the full extent to prevent a sell-off of strategic EU assets, including healthcare-related assets, technologies and infrastructure.
xi White Paper on foreign subsidies
On 17 June 2020, the Commission published its long-awaited White Paper 'on levelling the playing field as regards foreign subsidises'.122 That document contains proposals for new tools to prevent foreign subsidies from distorting the internal market in the EU. Those tools are intended to cover foreign subsidies in the following situations:
a distorting the internal market regarding:
• the general market operation of economic operators active in the EU;
• acquisitions of EU undertakings; and
• EU public procurement procedures; and
b in the context of access to EU funding.
According to the Commission, that tool is necessary in part because of the lack of compliance by WTO Members with the notification obligations under the WTO's SCM Agreement and the concerns arising from 'state sponsored unfair trading practices, which disregard market forces and abuse existing international rules, with a view to building up dominance across various sectors of economic activity'.123
The current proposal notes that the foreign subsidy would only become subject to the new legal instrument if it causes, directly or indirectly, distortions of the internal market. It lists a number of subsidies considered likely to have such a distortive effect: (1) subsidies granted directly to undertakings established in the EU; (2) foreign subsidies granted to an undertaking established in a third country where such a subsidy is used by a related party established in the EU; and (3) foreign subsidies granted to an undertaking established in a third country where such a subsidy is used to facilitate the acquisition of an EU undertaking or to participate in EU public procurement procedures.
Three mechanisms (modules) are proposed to tackle subsidies with distortive effect:
a The first module (General instrument to capture foreign subsidies) involves the possibility for competent 'supervisory authorities' (i.e., the Commission and relevant Member State authorities) to open an investigation and impose 'redressive measures'; for example, restricting (divestment of assets), prohibition of investments and acquisitions, and 'redressive payments', in respect of subsidies granted by a third country to companies operating in the EU.
b The second module (Foreign subsidies facilitating the acquisition of EU targets) would require foreign investors to notify acquisitions in an EU company to establish that the acquisition takes place on 'market terms' ('acquisition' is defined broadly and proposed to extend to direct and indirect control of an undertaking, direct or indirect acquisition of at least part or a set percentage of shares or voting rights or otherwise 'material influence' in an undertaking).
c The third module is intended to ensure that 'foreign subsidies can be addressed in individual public procurement procedures' and that 'EU public buyers would be required to exclude from public procurement procedures those economic operators that have received distortive foreign subsidies'.124
Last, the White Paper raises the possibility of developing legislation to address the distortive effects of foreign subsidies undertakings gaining access to EU funding, in particular in the context of the common agricultural policy and the European structural and investment funds.
The White Paper does not constitute a legislative proposal but will instead launch a consultation period that will run until 23 September 2020. It is then likely to be followed by legislative proposals from the Commission to the co-legislators, the Council and the European Parliament.
xii Supply chains and human rights
On 29 April 2020, Commissioner Didier Reynders (who deals with justice) announced that the Commission will introduce a legislative initiative in 2021 on mandatory due diligence requirements, meaning that EU companies will have to conduct due diligence in respect of human rights and environmental rules throughout their supply chains. Reynders' announcement succeeded the publication of a report that sought to identify, prevent, mitigate and account for abuses of human rights, including the rights of the child and fundamental freedoms, serious bodily injury or health risks, environmental damage, including with respect to climate.125 According to Reynders, voluntary measures had not been sufficiently effective in encouraging companies to perform and account for human rights and environmental impact protection in their supply chains.126 This proposal follows already-implemented compulsory due diligence legislation in the UK127 and France128 in recent years.
While few details are available so far, the legislation comes in addition to existing legislation in the forestry (timber)129 and mining (conflict minerals)130 areas, in which the EU already seeks to control forced labour and the related financing of armed conflict from funds derived from the trade in such goods. Once the proposal is published, this review will provide further details on the new measures.
V TRADE DISPUTES BEFORE THE EUROPEAN COURTS
In 2019, the ECJ and the GC together rendered a total of 31 judgments and orders in the TDI area.131 In last year's review, given a similar trend, we spoke of a slow reduction in pending cases before the courts. That trend saw an interesting reversal. As at the end of 2019, 48 cases were pending before the GC alone and 13 before the ECJ;132 this represents an increase of 13 pending cases before the GC. Those numbers speak clearly: on the one hand, they shows that the investigative 'slump' of 2017 was followed by an active investigative response by the Commission in 2018, whereas, on the other hand, it appears as if, where available, economic operators increasingly seek recourse to the GC by way of direct action pursuant to Article 263 of the TFEU, as opposed to leaving that role to importers before national courts of the Member States.
In 2019, the trend to shift litigation towards the GC has led to some interesting judgments at the lower level of the two European courts. That being said, in 2019, the ECJ, too, has rendered some practically interesting rulings. Some of those developments are discussed below.
i Admissibility of court actions in EU trade defence law
When are direct actions by importers, related or not, admissible before the EU courts?
When is an importer entitled to plead the invalidity of an anti-dumping regulation before a national court of the Member States and when it is allowed to seek recourse directly before the European courts? That question has long created uncertainty. Given the normative character of anti-dumping regulations under EU law,133 direct actions pursuant to the fourth paragraph of Article 263 of the TFEU have often been difficult to determine. And yet, the correct identification of venue is vital, for the ECJ in TWD Textilwerke Deggendorf already in 1994 explained that a company that could perfectly well have brought an action for annulment before the EU judicature must be deemed barred for calling on a national court for the same purpose.134
The judgment in Trace Sport135 is the latest to add to the understanding of that framework. This case concerned a related importer of bicycles from Sri Lanka, who challenged the imposition of the anti-dumping duty before the Dutch courts. When the national court sought a preliminary ruling on the invalidity of the regulation underlying the duty imposition, the Dutch government, the Council and the Commission argued that the importer could have brought an action directly before the GC – after all, Trace Sport was related to an exporting producer who undoubtedly had such standing.136
In resolving that question, the ECJ recalled the existing case law on admissibility. First, a regulation imposing anti-dumping duties may individually affect those producers and exporters of the product concerned that have been charged with the practice of dumping on the basis of information relating to their business activities.137 Second, an anti-dumping regulation may affect those importers of the product concerned whose resale prices were taken into account for the construction of export prices and which are consequently concerned by the findings relating to the existence of dumping.138 And, third, that may further be so in the case of importers associated with exporters of the product in question, particularly when the export price has been calculated on the basis of those importers' resale prices on the EU market and when the anti-dumping duty itself has been calculated on the basis of those resale prices.139
In the light of that case law, the ECJ then explained that the mere circumstance of being an importer of goods subject to anti-dumping duties, even if related to a manufacturer or exporter, is not sufficient to determine whether those importers are individually concerned by an anti-dumping duty.140 Accordingly, there is a need for individualising features that distinguish the related importer from the group of all other people affected by the regulation.141
In the case of Trace Sport, those properties were not present. To the ECJ, it was not clear, without any doubt, that the importer was sufficiently linked to the exporters in question, since the parent company of Trace Sport owned, through offshore companies, 50 per cent of a company to which the Sri Lankan exporter was a subsidiary.142 Furthermore, it considered that the mere fact that Trace Sport sought to intervene during the investigation in support of the Sri Lankan exporter was not sufficient to establish that it would, without doubt, have had a right of action before the GC pursuant to Article 263 of the TFEU. Accordingly, its action could not be denied admissibility under the TWD Textilwerke Deggendorf case law.
In the discussion on admissibility and the application of the TWD doctrine, Trace Sport is significant for two reasons: it clarifies years of case law by summarising and confirming in a clear manner the conditions for locus standi in trade defence actions. However, at the same time, it resurrects the 'sufficient link' theory of TMK Europe,143 which muddies the waters of the relatively clear TWD framework, and arguably shifts the burden of proving sufficiency from the party seeking admissibility before the ECJ to the party invoking the inadmissibility of the action before the ECJ.144 How sufficient that link must be, the ECJ does not explain.
For the moment, and until the 'sufficiency' requirement is decided, Trace Sport thus stands as both friend and foe for economic operators wishing to bring an action before the European courts.
Towards a right of protection by means of anti-dumping duties?
To date, the general understanding has been that the general admissibility rules for actions under Article 263 of the TFEU also apply to the EU industry – the party usually lodging complaints against injurious dumping. That may change soon, however, if the opinion of Advocate General Tanchev in Changmao is followed.145
Here, the Advocate General suggested that the EU industry could claim to be directly affected in its legal situation by an anti-dumping measure because it has a right not to be subject to competition distorted by dumping on the market in which it is active.146 Granted, that test had been endorsed by the ECJ in its judgment in Montessori.147 However, Montessori concerned a state aid case, in which the ECJ had long ago recognised that market participants derive a constitutional right for the preservation of free competition on the internal market directly from Article 107(1) of the TFEU.148 An equivalent Treaty right to protection from injurious dumping does not exist. As Advocate General Tesauro had already noted in 1989, all that the EU legislator provides for is a legitimate interest on the part of the EU industry in the adoption of measures if – and only so long as – the conditions for their imposition, which are dumping, injury, causation, and EU interest, are satisfied.149
While it remains to be seen which position the ECJ takes on this question, the contention that there exists a constitutional right to protection from foreign trade is revolutionary in EU trade defence law. However, it instils the questionable assumption that the EU Treaties were meant to limit the right to trade internationally.150 Whether the ECJ does away with the old assumption on admissibility remains open.
ii Protocol on the Accession of China to the WTO in the EU legal order
Can the Protocol on the Accession of China to the WTO (the Chinese Accession Protocol) directly be relied on before the European courts to interpret Article 2(7) of the basic Anti-Dumping Regulation? That was the question before the GC in Zhejiang Jndia.151 The GC replied with a resounding 'no': the Chinese Accession Protocol could not produce direct effect for the interpretation of Article 2(7) of the basic Anti-Dumping Regulation. What is more, the GC also held that Article 2(7) could not even be coloured by the content of the Chinese Accession Protocol through the EU law principle of 'interpretation in conformity'.
It is the assessment of the principle of 'interpretation in conformity' that raises the most questions. That principle provides that instruments of secondary EU law must, as far as possible, be interpreted in a manner that is consistent with the EU's international agreements.152 What is important in this regard is that the principle applies irrespective of whether the circumstances of the case correspond to one of the two situations described in Fediol153 and Nakajima.154 Applying the principle of interpretation in conformity to the present case, the GC thus considered whether Article 2(7) of the basic Anti-Dumping Regulation should be interpreted in conformity with the Chinese Accession Protocol. The GC concluded that was not possible; the Commission was not required to interpret Article 2(7) in light of Section 15 of the Chinese Accession Protocol since Article 2(7) was already found, in Rusal Armenal,155 not to be a provision intended to implement a specific obligation in the context of the WTO Agreements.156
However, there is more to the story. Rusal Armenal only reviewed the direct effect of the WTO Anti-Dumping Agreement against Article 2(7) of the basic Anti-Dumping Regulation, but did not do so in respect of the interpretation in conformity with Section 15 of the Protocol on the Accession of China to the WTO. Consequently, to rely, somewhat blindly, on that judgment without performing a separate conformity assessment arguably renders that conclusion incomplete. Granted, since Rusal Armenal, it has been recognised that the space between market (Article 2 of the WTO Anti-Dumping Agreement) and centrally planned (Ad Note to Article VI(1) of the General Agreement on Tariffs and Trade (GATT) 1994) economies is open to the EU legislature to exercise a regulatory approach specific to the EU legal order. That, however, does not solve the larger question of what role the principle of 'interpretation in conformity' should play in a situation that is neither Nakajima nor Fediol. In addition, even if Article 2(7) of the basic Anti-Dumping Regulation is specific to the EU legal order, is its methodology not at least 'comparable' to that envisaged within Section 15 of the Protocol on the Accession of China to the WTO? For otherwise it would concern a methodology not provided for by the WTO Agreements on an issue exclusively governed by it, which, arguably, would itself amount to a violation of WTO law. And, if going by Advocate General Bot in Philips Lighting, does the principle of 'interpretation in conformity' not at least require that a provision, on account of its ambiguity, be construed in such a way as to be consistent with the comparable provision of the international agreement at issue?157 The converse, one would imagine, could open an avenue for the EU legislator to circumvent international legal obligations by way of 'EU-specific' rules that expressly exclude Nakajima and Fediol on paper but may, in fact, be comparable to the international obligation concerned.
Finally, even if that consideration is somewhat theoretical, should the GC, at the very least, not have assessed whether the 'interpretation in conformity' should have warranted a third calculation possibility in the basic Anti-Dumping Regulation, since the Protocol on the Accession of China to the WTO also provides for a third approach to calculating normal value (next to that for market and centrally planned economies)? While a primer in some respects, Zhejiang Jndia leaves a number of policy questions unresolved.
iii Article 2(9) versus Article 2(11) of the basic Anti-Dumping Regulation:
empowerments and equalising forces
In April 2020, the GC handed down its judgment in Hansol Paper.158 That case raised two interesting practical questions. First, may the Commission, with the agreement of the economic operator at issue, limit its investigation to one or more entities only? And if that is permitted, may the Commission draw inferences on pricing decisions from the data of that one company for other related companies? Second, what happens when an economic operator cannot track in its stocks the volume of imports of a particular product? In such a case, may the Commission focus on the output product and extrapolate therefrom how many sales of the input product were made to the EU?
On the first question, according to the GC, the legal basis for the Commission's methodology flows from Article 2(9) of the basic Anti-Dumping Regulation (that is, the possibility to revert to 'any reasonable basis' to establish the export price).159 On that account, the GC implicitly blessed the Commission with the power to limit its investigation to a certain number of parties and the methodology employed as regards the determination of the dumping margin.160 That provides the Commission with an important policy instrument to establish a 'reasonable' methodology pursuant to Article 2(9) of the basic Anti-Dumping Regulation and even to derive an export price for an upstream product from a related downstream product.
On the second question, the directions were not as positive. The GC faulted the Commission for the inferences it drew from the use of that methodology, because it led to a situation in which 'like with like' was no longer compared. That brought about a violation of Article 2(11) of the basic Anti-Dumping Regulation.161 In finding that way, the GC arguably elevates the 'fair comparison' requirement of Article 2(11) of the basic Anti-Dumping Regulation to a yardstick of assessing overall reasonableness. That is to say that this provision is used to limit the Commission from creating an imbalance by comparing a normal value assessed on the basis of a larger number of transactions with an export price arguably established on the basis of a more limited number of transactions. In effect, that is the same 'reference point' logic pursued by Jindal,162 and taken up later in the Hansol Paper judgment for undercutting purposes,163 just at a different point of the calculation.
If that logic were upheld going forward, then Article 2(11) of the basic Anti-Dumping Regulation could be called on to trump an earlier scoping exercise for the purposes of limiting an investigation (be that on the normal value or on the export price side). That would also mean that Article 2(11) of the basic Anti-Dumping Regulation could gain a lot more prominence in future trade defence litigation. Whether that conclusion is tilted in either direction by the fact that the Commission was in possession of (unverified) data from a related converter outside the 'scope' of the investigation remains to be seen: after all, that psychological factor may have pushed the 'Article 2(11) conclusion'. And yet, if, indeed, there exists an (as yet unrepeated) overarching obligation on the Commission to go beyond the administrative file before it, despite an agreed methodology to the contrary, then has Hansol Paper not, in fact, opened the door to a reversal of the burden of proof as was the case for Article 2(7) of the basic Anti-Dumping Regulation? If so, that would be quite revolutionary.
VI TRADE DISPUTES BEFORE THE WTO DISPUTE SETTLEMENT BODY
The previous year showed a calm landscape for EU trade dispute before the WTO. Of possible interest to the practitioner will be a case that may feature in next year's review: Turkey's challenge to the definitive safeguard measures on certain steel products and the investigation that led to the imposition of those measures. The dispute was registered as DS595 (European Union – Safeguard Measures on Certain Steel Products), with consultations requested in March 2020.
The same measures were also featured in the previous two editions of this review. The importance of these measures (and the now ensuing dispute settlement proceedings) are not to be understated. First, the measures were the result of only the second safeguard investigation ever initiated by the EU pursuant to the rules set out in Article XIX of GATT 1994 and the WTO Agreement on Safeguards, as implemented by Regulations (EU) 2015/478 and (EU) 2015/755. Second, they were put in place against the background explanation of a threat of serious injury linked to the existence of trade diversion from the United States' Section 232 measures on certain steel products. Those measures were reviewed in 2019,164 with a second review165 pending currently.
In its request for consultations in DS595, Turkey alleges a number of violations pertaining to the reasoning and adequacy of the EU's findings and conclusions pertaining to the determinations of:
- the products concerned, the domestic like product, and the domestic industry (alleging, inter alia, that the EU failed to define the products concerned in a consistent manner throughout the investigation);
- 'unforeseen developments' and how those 'unforeseen developments' resulted in increased imports of the products concerned, threatening to cause serious injury to domestic producers;
- the effect of the obligations incurred under GATT 1994 and how that effect resulted in increased imports of the products concerned, threatening serious injury to domestic producers;
- the increase in imports of the products concerned, in absolute terms or relative to domestic production;
- the existence of a threat of serious injury to the domestic industry;
- its determinations of the causal link between the increase in imports and the threat of serious injury to the domestic industry (lack of findings and conclusions on the causal relationship between the increased imports and the threat of serious injury);
- the imposition of provisional and definitive measures on imports from certain countries only, excluding some developing countries as well as certain countries with which the EU has concluded FTAs;
- the quotas and the allocation among countries having a 'substantial interest' in supplying the products concerned;
- reduction of the pace of liberalisation of the definitive safeguard measures after the first review; and
- the exemption of certain imports originating in certain countries from the scope of application of the measures.
Last, Turkey is alleging that the imposition of the definitive safeguard measures has led to the imposition of 'other duties or charges' contrary to the second sentence of Article II:1(b) of GATT 1994.
Interestingly, most of these arguments are also pending before the GC in an action filed by the only Moldovan exporting producer to have participated in the underlying safeguard investigation.166 As that action is still pending, it remains to be seen which forum decides first and whether the different forums reach different conclusions.
The effect of global trade tensions and the covid-19 pandemic is likely to accelerate the already existing trend of diverting global supply chains from countries affected by increasing trade tensions to a number of countries offering greater sourcing resilience.167 China might be the main loser in that regard. The authors believe that this effect will also lead to new 'target' countries for TDI purposes. The GFF investigation into Chinese-financed production facilities in Egypt is just the beginning of that trend.
That being said, 2020 is unlikely to prove a boon for TDI lawyers. While TDI activity is usually countercyclical – economic operators needing greater protection when times are tough – trade defence measures require, first and foremost, trade. With a dramatic slowdown in the latter, there is unlikely to be much activity in the former. For the coming year, it is thus reasonable and realistic to predict a decline in the Commission's TDI activity, as compared to the 'healthy' TDI year in 2019.
Gloomy outlooks on one front make for even gloomier ones on another: Brexit. However, rarely have such outlooks swayed the position of politicians: 'the doomsters and gloomsters' would be wrong about their Brexit predictions, Prime Minister Johnson said in July 2019. A year after that speech, we are still covering the issue of Brexit in this chapter, as the terms of the new relationship between the UK and the EU remain uncertain and the transition period is very likely to be extended. Whether the realities of global economic development provide for a more sobering incentive to delay the current deadline of 31 July 2020 for the conclusion of the future trade deal with the EU, we will see next year.
So, what is to come otherwise? Simon Evenett observes that the covid-19 crisis is reminiscent of the old mantra that each sharp global downturn brings with it a rise in discrimination against foreign commercial interests.168 There is certainly some truth to that in relation to the EU. At its horizon linger those as yet unnamed policy tools that the White Paper designates as necessary to countervail – to use a known term – the effects of foreign subsidies doled out across the globe that have a distortive effect on the internal market. That is not just in response to covid-19, but certainly also with a view to softening the resulting economic blow. If legislative consultations on those instruments commence, they would revolutionise the EU's trade policy arsenal (as outdated and small as it is). At the same time, the new tools might influence tit-for-tat measures in other areas of the world. However, those are mere predictions swaying like loose cargo in a rugged ocean of uncertainty.
1 Nicolaj Kuplewatzky is a référendaire at the Court of Justice of the European Union and Nia Bagaturiya is an associate at V V G B.
2 Aljoscha Nau, IW-Policy Paper 9/2020, 'World Trade in 2020: The show must go on!', 28 April 2020, p. 2.
3 World Health Organization, “Historic health assembly ends with global commitment to COVID-19 response', news release of 19 May 2020, at https://www.who.int/news-room/detail/19-05-2020-historic-health-assembly-ends-with-global-commitment-to-covid-19-response">https://www.who.int/news-room/detail/19-05-2020-historic-health-assembly-
ends-with-global-commitment-to-covid-19-response (last accessed 25 June 2020).
4 See, for instance, J Horowitz, 'Europe's “stimulus fireworks”: ECB and Germany throw new wall of money at the economy', CNN business, 4 June 2020, at https://edition.cnn.com/2020/06/04/economy/europe-stimulus-
ecb-germany/index.html (last accessed 25 June 2020). See also S Nagarajan, 'EU plans a record-breaking $826 billion stimulus package to soothe Europe's economic pain from the coronavirus', Markets Insider, 27 May 2020, at https://markets.businessinsider.com/news/stocks/eu-unveils-new-groundbreaking-covid-19-stimulus-826-billion-2020-5-1029236883?utm_source=markets&utm_medium=ingest">https://markets.businessinsider.com/news/stocks/eu-unveils-new-groundbreaking-covid-19-
stimulus-826-billion-2020-5-1029236883?utm_source=markets&utm_medium=ingest (last accessed 25 June 2020).
5 See, generally, in that regard, European Commission, DG Competition, 'State aid rules and coronavirus', at https://ec.europa.eu/competition/state_aid/what_is_new/covid_19.html (last accessed 25 June 2020).
6 OECD Policy Responses to Coronavirus (COVID-19), 'COVID-19 and international trade: Issues and actions', 10 April 2020, at http://www.oecd.org/coronavirus/policy-responses/covid-19-and-international-trade-issues-and-actions-494da2fa/">http://www.oecd.org/coronavirus/policy-responses/covid-19-and-international-trade-issues-and-actions-494da2fa/ (last accessed 25 June 2020).
7 Regulation (EU) 2016/1036 of the European Parliament and of the Council of 8 June 2016 on protection against dumped imports from countries not members of the European Union (codification), OJ L 176, 30 June 2016, p. 21.
8 Regulation (EU) 2016/1037 of the European Parliament and of the Council of 8 June 2016 on protection against subsidised imports from countries not members of the European Union (codification), OJ L 176, 30 June 2016, p. 55.
9 Regulation (EU) 2017/2321 of the European Parliament and of the Council of 12 December 2017 amending Regulation (EU) 2016/1036 on protection against dumped imports from countries not members of the European Union and Regulation (EU) 2016/1037 on protection against subsidised imports from countries not members of the European Union, OJ L 338, 19 December 2017, p. 1.
10 Regulation (EU) 2018/825 of the European Parliament and of the Council of 30 May 2018 amending Regulation (EU) 2016/1036 on protection against dumped imports from countries not members of the European Union and Regulation (EU) 2016/1037 on protection against subsidised imports from countries not members of the European Union, OJ L 143, 7 June 2018, p. 1.
11 Regulation (EC) 2015/478 of the European Parliament and of the Council of 11 March 2015 on common rules for imports (codification), OJ L 83, 27 March 2015, p. 16.
12 Regulation (EC) 2015/755 of the European Parliament and of the Council of 29 April 2015 on common rules for imports from certain third countries (recast), OJ L 123, 19 May 2015, p. 33.
13 38th Annual Report from the Commission to the Council and the European Parliament on the EU's Anti-Dumping, Anti-Subsidy and Safeguard activities and the Use of trade defence instruments by Third Countries targeting the EU in 2019 (2020), p. 2.
14 id., at pp. 1 to 3.
15 id., at p. 7.
16 Commission Implementing Regulation (EU) 2019/159 of 31 January 2019 imposing definitive safeguard measures against imports of certain steel products, OJ L 31, 1 February 2019, p. 27.
17 The traditional levels of imports into the EU were preserved and will be increased progressively. The main supplying countries benefit from country-specific quotas based on their own historical imports.
18 Until 30 June 2021.
19 Commission Implementing Regulation (EU) 2019/159 of 31 January 2019 imposing definitive safeguard measures against imports of certain steel products, OJ L 31, 1 February 2019, p. 54.
20 Notice of initiation concerning the review of the safeguard measures applicable to imports of certain steel products, OJ C 169, 17 May 2019, p. 9.
21 Commission Implementing Regulation (EU) 2019/1590 of 26 September 2019 amending Implementing Regulation (EU) 2019/159 imposing definitive safeguard measures against imports of certain steel products, OJ L 248, 27 September 2019, p. 28.
22 Regulation (EU) No. 952/2013 of the European Parliament and of the Council of 9 October 2013 laying down the Union Customs Code, OJ L 269, 10 October 2013, p. 1.
23 Commission Implementing Regulation (EU) 2020/35 of 15 January 2020 amending Implementing Regulation (EU) 2019/159 imposing definitive safeguard measures against imports of certain steel products, OJ L 12, 16 January 2020, p. 13.
24 Notice of initiation concerning a review of the safeguard measures applicable to imports of certain steel products, OJ C 51, 14 February 2020, p. 21.
25 Note to the file, 30 April 2020, Trade H5/EA/t20. t20.003257.
26 Commission Implementing Regulation 2019/244 of 11 February 2019 imposing a definitive countervailing duty on imports of biodiesel originating in Argentina, OJ L 40, 12 February 2019, p. 1.
27 Commission Implementing Decision 2019/245 of 11 February 2019 accepting undertaking offers following the imposition of definitive countervailing duties on imports of biodiesel originating in Argentina, OJ L 40, 12 February 2019, p. 71.
28 Commission Implementing Regulation (EU) 2019/2092 of 28 November 2019 imposing a definitive countervailing duty on imports of biodiesel originating in Indonesia, OJ L 317, 9 December 2019, p. 42.
29 See Notice of initiation of an anti-subsidy proceeding concerning imports of biodiesel originating in Argentina and Indonesia, OJ C 342, 10 November 2012, p. 12 and Notice of initiation of an anti-dumping proceeding concerning imports of biodiesel originating in Argentina and Indonesia, OJ C 260, 29 August 2012, p. 8.
30 Actions brought on 27 March 2020, T-111/20 PT Wilmar Bioenergi Indonesia and Others v. Commission; T-138/20 PT Ciliandra Perkasa v. Commission; and 2 March 2020, T-143/20 PT Pelita Agung Agrindustri and PT Permata Hijau Palm Oleo v. Commission, at http://curia.europa.eu/">http://curia.europa.eu/ (last accessed 25 June 2020).
31 Notice of initiation of an anti-subsidy proceeding concerning imports of certain woven and/or stitched glass fibre fabrics originating in the People's Republic of China and Egypt, OJ C 167, 16 May 2019, p. 11.
32 id., at Section 3.2.
33 Notice of initiation of an anti-subsidy proceeding concerning imports of continuous filament glass fibre products [GFR] originating in Egypt, OJ C 192, 7 June 2019, p. 30.
34 Notice of initiation of an anti-subsidy proceeding concerning imports of certain hot-rolled stainless steel sheets and coils originating in the People's Republic of China and Indonesia, OJ C 342, 10 October 2019, p. 18.
35 On 6 March 2020, provisional countervailing duties were imposed on imports of GFR from Egypt – see Commission Implementing Regulation (EU) 2020/379 of 5 March 2020 imposing a provisional countervailing duty on imports of continuous filament glass fibre products originating in Egypt, OJ L 69, 6 March 2020, p. 14.
36 V Crochet, V Hegde, 'China's Going Global Policy: Transnational Subsidies under the WTO SCM Agreement', Leuven Centre for Global Governance Studies, Working Paper No. 220, February 2020, p. 21.
38 Commission Implementing Regulation (EU) 2020/776 of 12 June 2020 imposing definitive countervailing duties on imports of certain woven and/or stitched glass fibre fabrics originating in the People's Republic of China and Egypt and amending Commission Implementing Regulation (EU) 2020/492 imposing definitive anti-dumping duties on imports of certain woven and/or stitched glass fibre fabrics originating in the People's Republic of China and Egypt, OJ L 189, 15 June 2020, p. 1.
39 id., at Recitals (685) to (689).
40 id., at Article 1.2.
41 See Tech-Fab Europe's news report titled 'European glass fibre fabrics manufacturers welcome new era in EU trade defence to counter foreign subsidies', at https://tech-fab-europe.eu/news/new-era-in-eu-trade-defence-to-
counter-foreign-subsidies/ (last accessed 25 June 2020).
42 Commission Implementing Regulation (EU) 2020/492 of 1 April 2020 imposing definitive anti-dumping duties on imports of certain woven and/or stitched glass fibre fabrics originating in the People's Republic of China and Egypt, OJ L 108, 6 April 2020, p. 1.
43 The main cost factor taken into account is the cost of raw materials, which the Commission found was distorted and subsidised.
44 Commission Implementing Regulation (EU) 2020/776 of 12 June 2020 imposing definitive countervailing duties on imports of certain woven and/or stitched glass fibre fabrics originating in the People's Republic of China and Egypt and amending Commission Implementing Regulation (EU) 2020/492 imposing definitive anti-dumping duties on imports of certain woven and/or stitched glass fibre fabrics originating in the People's Republic of China and Egypt, OJ L 189, 15 June 2020, p. 166 to 167, Article 2.
45 Article 2.6.a(a) of Regulation (EU) 2017/2321 of the European Parliament and of the Council of 12 December 2017 amending Regulation (EU) 2016/1036 on protection against dumped imports from countries not members of the European Union and Regulation (EU) 2016/1037 on protection against subsidised imports from countries not members of the European Union, OJ L 338, 19 December 2017, p. 1.
46 Commission Implementing Regulation (EU) 2020/353 of 3 March 2020 imposing a definitive anti-dumping duty and definitively collecting the provisional duty imposed on imports of steel road wheels originating in the People's Republic of China, OJ L 65, 4 March 2020, pp. 9 to 23.
47 Regulation (EU) 2019/1259 of 24 July 2019 imposing a definitive anti-dumping duty on imports of threaded tube or pipe cast fittings, of malleable cast iron and spheroidal graphite cast iron, originating in the People's Republic of China and Thailand, following an expiry review pursuant to Article 11(2) of Regulation (EU) 2016/1036 of the European Parliament and of the Council, OJ L 197, 25 July 2019, pp. 2 to 36.
48 Regulation (EU) 2019/1198 of 12 July 2019 imposing a definitive anti-dumping duty on imports of ceramic tableware and kitchenware originating in the People's Republic of China following an expiry review pursuant to Article 11(2) of Regulation (EU) No 2016/1036, OJ L 189, 15 July 2019, pp. 8 to 67.
49 Regulation (EU) 2019/915 of 4 June 2019 imposing a definitive anti-dumping duty on imports of certain aluminium foil in rolls originating in the People's Republic of China following an expiry review under Article 11(2) of Regulation (EU) 2016/1036 of the European Parliament and of the Council, OJ L 146, 5 June 2019, pp. 63 to 97.
50 Regulation (EU) 2019/687 of 2 May 2019 imposing a definitive anti-dumping duty on imports of certain organic coated steel products originating in the People's Republic of China following an expiry review pursuant to Article 11(2) of Regulation (EU) 2016/1036 of the European Parliament and of the Council, OJ L 116, 3 May 2019, pp. 5 to 38.
51 Regulation (EU) 2019/1267 of 26 July 2019 imposing a definitive anti-dumping duty on imports of tungsten electrodes originating in the People's Republic of China following an expiry review under Article 11(2) of Regulation (EU) 2016/1036, OJ L 200, 29 July 2019, pp. 4 to 32.
52 Commission Implementing Regulation (EU) 2020/39 of 16 January 2020 imposing a definitive anti-dumping duty on imports of peroxosulphates (persulphates) originating in the People's Republic of China following an expiry review pursuant to Article 11(2) of Regulation (EU) 2016/1036 of the European Parliament and of the Council, OJ L 13, 17 January 2020, p. 18.
53 Commission Implementing Regulation (EU) 2019/1379 of 28 August 2019 imposing a definitive anti-dumping duty on imports of bicycles originating in the People's Republic of China as extended to imports of bicycles consigned from Indonesia, Malaysia, Sri Lanka, Tunisia, Cambodia, Pakistan and the Philippines, whether declared as originating in these countries or not, following an expiry review pursuant to Article 11(2) of Regulation (EU) No 2016/1036, OJ L 225, 29 August 2019, p. 1.
54 Commission Implementing Regulation (EU) 2019/1662 of 1 October 2019 imposing a definitive anti-dumping duty on imports of ironing boards originating in the People's Republic of China following an expiry review pursuant to Article 11(2) of Regulation (EU) 2016/1036 of the European Parliament and of the Council, OJ L 252, 2 October 2019, p. 1.
55 Notice of initiation of an expiry review of the anti-dumping measures applicable to imports of ferro-silicon originating in Russia and the People's Republic of China, OJ C 123, 2 April 2019, p. 9.
56 The expiry review of the anti-dumping measures applicable to imports of ferro-silicon originating in Russia and the People's Republic of China has not been concluded yet.
57 Russia – at 27.77 EUR/t (Azot and Nevinnomyssky Azot), 42.47 EUR/t (Acron and other companies); in Trinidad and Tobago – at 22.24 EUR/t; and in the United States – at 29.48 EUR/t.
58 Commission Implementing Regulation (EU) 2019/1688 of 8 October 2019 imposing a definitive anti-dumping duty and definitively collecting the provisional duty imposed on imports of mixtures of urea and ammonium nitrate originating in Russia, Trinidad and Tobago and the United States of America, OJ L 258, 9 October 2019, p. 21.
59 Commission Implementing Regulation 2019/576 of 10 April 2019 imposing a provisional anti-dumping duty on imports of mixtures of urea and ammonium nitrate originating in Russia, Trinidad and Tobago and the United States of America, OJ L 100, 11 April 2019, p. 7, and Commission Implementing Regulation (EU) 2019/1688 of 8 October 2019 imposing a definitive anti-dumping duty and definitively collecting the provisional duty imposed on imports of mixtures of urea and ammonium nitrate originating in Russia, Trinidad and Tobago and the United States of America, OJ L 258, 9 October 2019, p. 21.
61 Decision (EU) 2019/339 of the President of the European Commission of 21 February 2019 on the function and terms of reference of the hearing officer in certain trade proceedings, OJ L 60, 28 February 2019, p. 20.
62 id., at Article 1: Regulation (EU) No. 2016/1036 and, in particular, Articles 5(10) and (11), 6(5) to (8), 8(3), (4) and (9), and 18 to 21 thereof; Regulation (EU) 2016/1037 and, in particular, Article 10(12) and (13), 11(5) to (8) and (10), 13(3), (4) and (9), and 28 to 31 thereof; Regulation (EU) 2015/478 of the European Parliament and of the Council (6) and, in particular, Arts. 5 and 8 thereof; Regulation (EU) 2015/755 of the European Parliament and of the Council (7) and, in particular, Articles 3 and 5 thereof; Regulation (EU) 2015/1843 of the European Parliament and of the Council (8) and, in particular, Articles 9 and 10 thereof; Regulation (EU) 2016/1035 of the European Parliament and of the Council (9) and, in particular, Articles 5(12) and (13), 6(5) to (8), and 12, 13 and 14 thereof; Regulation (EC) No. 868/2004 of the European Parliament and of the Council (10) and, in particular, Articles 7 and 8 thereof; Regulation (EU) No. 978/2012 of the European Parliament and of the Council (11) and, in particular, Article 24 thereof; Commission Delegated Regulation (EU) No. 155/2013 (12) and, in particular, Article 6 thereof; Commission Delegated Regulation (EU) No. 1083/2013 (13) and, in particular, Article 5 thereof; and Regulation (EU) 2015/476 of the European Parliament and of the Council (14) and, in particular, Articles 1(2) and 2(2) thereof.
63 id., at Article 5.
64 id., at Article 6.
65 The Treaty territory of the EU also extends to the 'continental shelf' and 'exclusive economic zones' of the Member States, as defined by the United Nations Convention on the Law of the Sea.
66 Commission Implementing Regulation (EU) 2019/1131 of 2 July 2019 establishing a customs tool in order to implement Article 14a of Regulation (EU) 2016/1036 of the European Parliament and of the Council and Article 24a of Regulation (EU) 2016/1037 of the European Parliament and of the Council, OJ L 179, 3 July 2019, p. 12.
67 See the Commission's news archive of 3 July 2019, 'EU extends trade defence rules to continental shelf and exclusive economic zones of Member States', at http://trade.ec.europa.eu/doclib/press/index.cfm?id=2043">http://trade.ec.europa.eu/doclib/press/index.cfm?id=2043 (last accessed 25 June 2020).
68 In 2019, the Commission initiated 16 new investigations, eight expiry reviews, two interim reviews and seven reinvestigations or reopenings. Also, the Commission increased its efforts to enforce measures, notably by initiating four anti-circumvention cases and one anti-absorption investigation.
69 Commission Implementing Regulation (EU) 2019/1997 of 29 November 2019 reopening the investigation following the judgment of 19 September 2019, in Case C‐251/18 Trace Sport SAS, with regard to Council Implementing Regulation (EU) No. 501/2013 of 29 May 2013 extending the definitive anti-dumping duty imposed by Implementing Regulation (EU) No. 990/2011 on imports of bicycles originating in the People's Republic of China to imports of bicycles consigned from Indonesia, Malaysia, Sri Lanka and Tunisia, whether declared as originating in Indonesia, Malaysia, Sri Lanka and Tunisia or not, OJ L 310, 2 December 2019, p. 29.
70 Notice of initiation of an expiry review of the anti-dumping measures applicable to imports of certain prepared or preserved citrus fruits (namely mandarins, etc.) originating in the People's Republic of China, OJ C 414, 10 December 2019, p. 14.
71 Commission Implementing Regulation (EU) 2019/2149 of 13 December 2019 initiating a 'new exporter' review of Implementing Regulation (EU) 2019/1379 imposing a definitive anti-dumping duty on imports of bicycles originating in the People's Republic of China for one Chinese exporting producer, repealing the duty with regard to imports from that exporting producer and making these imports subject to registration, OJ L 325, 16 December 2019, p. 159.
72 Notice of reopening the anti-dumping investigation concerning imports of certain cast iron articles originating in the People's Republic of China, OJ C 425, 18 December 2019, p. 9.
73 Notice of initiation of an anti-dumping proceeding concerning imports of pins and staples originating in the People's Republic of China, OJ C 425, 18 December 2019, p. 21.
74 Notice of initiation of an expiry review of the anti-dumping measures applicable to imports of sulphanilic acid originating in the People's Republic of China OJ C 425, 18 December 2019, p. 39.
75 Commission Implementing Regulation (EU) 2019/2171 of 17 December 2019 initiating an investigation concerning possible circumvention of anti-dumping measures imposed by Implementing Regulation (EU) 2019/1267 on imports of tungsten electrodes originating in the People's Republic of China by imports of tungsten electrodes consigned from India, Laos and Thailand, whether declared as originating in India, Laos and Thailand or not, and making such imports subject to registration, OJ L 329, 19 December 2019, p. 86.
76 See the Committee's on International Trade 'Hearing of Commissioner-designate Phil Hogan' of 30 September 2019, at https://www.europarl.europa.eu/resources/library/media/20191004RES63483/20191004RES63483.pdf">https://www.europarl.europa.eu/resources/library/media/20191004RES63483/
20191004RES63483.pdf (last accessed 25 June 2020).
78 See 'Commissioner Hogan announces new transparency package', of 18 February 2020, at https://trade.ec.europa.eu/doclib/press/index.cfm?id=2117">https://trade.ec.europa.eu/doclib/press/index.cfm?id=2117 (last accessed 25 June 2020).
79 Regulation (EC) No. 1049/2001 of the European Parliament and of the Council of 30 May 2001 regarding public access to European Parliament, Council and Commission documents, OJ L 145, 31 May 2001, p. 43.
80 See 'Commission reinforces tools to ensure Europe's interests in international trade', of 12 December 2019, at https://trade.ec.europa.eu/doclib/press/index.cfm?id=2091">https://trade.ec.europa.eu/doclib/press/index.cfm?id=2091 (last accessed 25 June 2020).
81 Regulation (EU) No. 654/2014 of the European Parliament and of the Council of 15 May 2014 concerning the exercise of the Union's rights for the application and enforcement of international trade rules and amending Council Regulation (EC) No. 3286/94 laying down Community procedures in the field of the common commercial policy in order to ensure the exercise of the Community's rights under international trade rules, in particular those established under the auspices of the World Trade Organization, OJ L 189 27 June 2014, p. 50.
82 See 'Trade defence report: restoring the level playing field for European producers' of 4 May 2020, at https://trade.ec.europa.eu/doclib/press/index.cfm?id=2144&title=Trade-defence-report-restoring-the-level-playing-field-for-European-producers">https://trade.ec.europa.eu/doclib/press/index.cfm?id=2144&title=Trade-defence-report-restoring-the-level-
playing-field-for-European-producers (last accessed 25 June 2020).
83 38th Annual Report from the Commission to the Council and the European Parliament on the EU's Anti-Dumping, Anti-Subsidy and Safeguard activities and the Use of trade defence instruments by Third Countries targeting the EU in 2019 (2020), p. 1.
84 id., at p. 11.
85 Judgment of 12 September 2019, Case C-709/17 P Commission v. Kolachi Raj Industrial, EU:C:2019:717, para. 107.
86 I Monterosa, O Guinea, P Lamprecht, 'Trade in Time of Corona: what's next for the EU?', June 2020, at https://ecipe.org/blog/trade-in-time-of-corona/?mc_cid=35f1e0761f&mc_eid=877e48ab45">https://ecipe.org/blog/trade-in-time-of-corona/?mc_cid=35f1e0761f&mc_eid=877e48ab45 (last accessed 25 June 2020).
87 See the Commission's report on the impact of the covid-19 pandemic on global and EU trade, 27 May 2020, p. 2, at https://trade.ec.europa.eu/doclib/docs/2020/may/tradoc_158764.pdf">https://trade.ec.europa.eu/doclib/docs/2020/may/tradoc_158764.pdf (last accessed 25 June 2020).
88 Notice on the consequences of the covid-19 outbreak on anti-dumping and anti-subsidy investigations, 13 March 2020 C(2020) 1527 final.
89 In its judgment, the ECJ noted that only the provisions relating to non-direct foreign investment and the regime governing dispute settlement between investors and states were of 'shared competence' nature. See, in this regard, N Kuplewatzky, 'Guest Editor's Introduction: Opinion 2/15 of the Court of Justice on the EU–Singapore Free Trade Agreement', Volume 13, Issue 1 (2018) pp. 2 and 3.
90 See the Commission's third annual report on the implementation of EU free trade agreements [FTAs] released on 14 October 2019.
91 These are signs used on traditional food and drink products from a specific geographical origin and which possess qualities or a reputation that are a result of that origin. Since the entry into force of the EU-Canada Comprehensive Economic and Trade Agreement, 143 names of food products are protected in Canada.
92 The EU and Japan's Economic Partnership Agreement entered into force on 1 February 2019.
93 The EU and Singapore's Free Trade Agreement and an Investment Protection Agreement entered into force on 21 November 2019.
94 The EU-Vietnam trade agreement is due to enter into force in 2020, upon conclusion of the ratification procedure by Vietnam.
95 See the Council's of the EU press release of 30 March 2020, 'EU-Vietnam: Council gives final green light to free trade agreement' (last accessed 25 June 2020).
96 In June 2019, Vietnam ratified the International Labour Organization Convention 98 on collective bargaining; in November 2019, it adopted a revised Labour Code and confirmed a timeline for the ratification of the remaining two fundamental International Labour Organization Conventions on freedom of association and on forced labour.
97 See the Commission's press release of 28 April 2020, 'EU and Mexico conclude negotiations for new trade agreement', at https://trade.ec.europa.eu/doclib/press/index.cfm?id=2142">https://trade.ec.europa.eu/doclib/press/index.cfm?id=2142 (last accessed 25 June 2020).
98 See the Commission's news archive of 26 July 2019, 'Commission publishes latest updates on trade and investment talks with Australia, New Zealand, Indonesia, Chile and China', at http://trade.ec.europa.eu/doclib/press/index.cfm?id=2054&title=Commission-publishes-latest-updates-on-trade-and-investment-talks-with-Australia-New-Zealand-Indonesia-Chile-and-China">http://trade.ec.europa.eu/doclib/press/index.cfm?id=2054&title=Commission-publishes-latest-updates-on-trade-and-investment-talks-with-
Australia-New-Zealand-Indonesia-Chile-and-China (last accessed 25 June 2020).
99 See the Committee's on International Trade 'Hearing of Commissioner-designate Phil Hogan' of
30 September 2019, at https://www.europarl.europa.eu/resources/library/media/20191004RES63483/20191004RES63483.pdf">https://www.europarl.europa.eu/resources/library/media/20191004RES63483/
20191004RES63483.pdf (last accessed 25 June 2020).
100 Thailand and the EU started FTA negotiations in 2013, but in 2014, they were put on hold after the fourth round of negotiation because of the military takeover in Thailand.
101 The Agreement on the withdrawal of the United Kingdom of Great Britain and Northern Ireland from the European Union and the European Atomic Energy Community [Withdrawal Agreement]. It was accompanied by the Protocol on Ireland and Northern Ireland, and the Political Declaration setting out the framework for the future relationship between the United Kingdom and the European Union.
102 See Article 132 of the Withdrawal Agreement.
103 See Trade Remedies Investigations Directorate [TRID] dumping, subsidisation and safeguarding investigations guidance, at https://www.gov.uk/guidance/trade-remedies-investigations-directorate-trid-dumping-and-subsidisation-investigations-guidance">https://www.gov.uk/guidance/trade-remedies-investigations-directorate-trid-dumping-and-
subsidisation-investigations-guidance (last accessed 25 June 2020).
104 The TRID was set up on 6 March 2019 within the Department for International Trade.
105 The transition reviews are expected to last 12 to 15 months.
106 The Call for Evidence ran from 28 November 2017 to 30 March 2018. After the publication of the provisional findings, on 24 July 2018, it was reopened until 24 August 2018.
107 The Call for Evidence was primarily directed at UK producers (or their representatives) that produce goods currently subject to EU anti-dumping measures or anti-subsidy measures and ongoing investigations. However, other interested parties, including downstream consumers and users, were also consulted.
108 The UK has not yet taken a view on transitioning EU safeguard measures, in particular those concerning steel. The expectation is that this will be done during the course of 2020.
109 See Regulation 98(1) of the Anti-Dumping and Anti-Subsidy Regulations, as amended by the Trade Remedies (Amendment) (EU Exit) Regulations 2019.
110 Normally, the expiry date of the UK measure should be the same as the expiry date of the relevant EU measure.
111 However, the TRID may, at its discretion, initiate a transition review earlier if there is good reason and doing so does not affect the timeline of the reviews. The initiation by the TRID follows after the publication of the notice of determination by the Secretary of State stating that a certain EU measure is to be transitioned.
112 Essentially all or a major proportion of the producers in the UK of the same or similar goods.
113 See Regulation 99A(1) of the Anti-Dumping and Anti-Subsidy Regulations, as amended by the Trade Remedies (Amendment) (EU Exit) Regulations 2019.
114 id., at Regulation 100(1).
115 Potentially, the Upper Tribunal will be required to deal with these matters as it hears appeals against decisions of the TRID (or the Trade Remedies Authority) and Security of State.
116 Commission press release, 'EU and 15 World Trade Organization members establish contingency appeal arrangement for trade disputes', 27 March 2020, at https://trade.ec.europa.eu/doclib/press/index.cfm?id=2127">https://trade.ec.europa.eu/doclib/press/index.cfm?id=2127 (last accessed 25 June 2020). See also the draft notification to the WTO Dispute Settlement Body, at https://trade.ec.europa.eu/doclib/docs/2020/march/tradoc_158685.pdf">https://trade.ec.europa.eu/doclib/docs/2020/march/tradoc_158685.pdf (last accessed 25 June 2020).
117 Communication, 'Statement on a mechanism for developing, documenting and sharing practices and procedures in the conduct of WTO Disputes', 30 April 2020, JOB/DSB/1/Add.12, at https://trade.ec.europa.eu/doclib/docs/2020/april/tradoc_158731.pdf">https://trade.ec.europa.eu/doclib/docs/2020/april/tradoc_158731.pdf (last accessed 25 June 2020).
118 Regulation (EU) 2019/452 of the European Parliament and of the Council of 19 March 2019 establishing a framework for the screening of foreign direct investments into the Union, OJ L 79I, 21 March 2019, p. 1.
119 That is to say, Austria, Denmark, Finland, France, Germany, Hungary, Italy, Latvia, Lithuania, the Netherlands, Poland, Portugal and Spain. Prior to its withdrawal from the EU, the UK also had such a system in place.
120 Communication from the Commission to the European Parliament, the European Council, the Council, the European Economic and Social Committee and the Committee of the Regions, A New Industrial Strategy for Europe, COM(2020) 102 final, 10 March 2020, at https://ec.europa.eu/info/sites/info/files/communication-eu-industrial-strategy-march-2020_en.pdf">https://ec.europa.eu/info/sites/info/files/communication-
eu-industrial-strategy-march-2020_en.pdf (last accessed 25 June 2020).
121 Communication from the Commission, Guidance to the Member States concerning foreign direct investment and free movement of capital from third countries, and the protection of Europe's strategic assets, ahead of the application of Regulation (EU) 2019/452 (FDI Screening Regulation), C(2020) 1981 final, 25 March 2020, at https://trade.ec.europa.eu/doclib/docs/2020/march/tradoc_158676.pdf">https://trade.ec.europa.eu/doclib/docs/2020/march/tradoc_158676.pdf (last accessed 25 June 2020).
122 See https://ec.europa.eu/competition/international/overview/foreign_subsidies_white_paper.pdf">https://ec.europa.eu/competition/international/overview/foreign_subsidies_white_paper.pdf (last accessed 25 June 2020).
123 id., at p. 4.
124 id., at p. 30.
125 The report is available at https://op.europa.eu/en/publication-detail/-/publication/8ba0a8fd-4c83-11ea-b8b7-01aa75ed71a1/language-en">https://op.europa.eu/en/publication-detail/-/publication/
8ba0a8fd-4c83-11ea-b8b7-01aa75ed71a1/language-en (last accessed 25 June 2020).
126 European Parliament Working Group on Responsible Business Conduct, 'European Commission Promises Mandatory Due Diligence Legislation in 2021', 30 April 2020, at https://responsiblebusinessconduct.eu/wp/2020/04/30/european-commission-promises-mandatory-due-diligence-legislation-in-2021/">https://responsiblebusinessconduct.eu/wp/2020/04/30/european-commission-promises-mandatory-due-diligence-legislation-in-2021/ (last accessed 25 June 2020).
127 UK Modern Slavery Act 2015, at http://www.legislation.gov.uk/ukpga/2015/30/contents/enacted">http://www.legislation.gov.uk/ukpga/2015/30/contents/enacted (last accessed 25 June 2020).
128 LOI n° 2017-399 du 27 mars 2017 relative au devoir de vigilance des sociétés mères et des entreprises donneuses d'ordre (French Duty of Vigilance law), at https://www.legifrance.gouv.fr/affichTexte.do?cidTexte=
JORFTEXT000034290626&categorieLien=id (last accessed 25 June 2020).
129 Regulation (EU) No. 995/2010 of the European Parliament and of the Council of 20 October 2010 laying down the obligations of operators who place timber and timber products on the market Text with EEA relevance, OJ L 295, 12 November 2010, p. 23.
130 Regulation (EU) 2017/821 of the European Parliament and of the Council of 17 May 2017 laying down supply chain due diligence obligations for Union importers of tin, tantalum and tungsten, their ores, and gold originating from conflict-affected and high-risk areas, OJ L 130, 19 May 2017, p. 1.
131 38th Annual Report from the Commission to the Council and the European Parliament on the EU's Anti-Dumping, Anti-Subsidy and Safeguard activities and the Use of trade defence instruments by Third Countries targeting the EU in 2019 (2020), p. 5.
132 Commission Staff Working Document accompanying the 38th Annual Report from the Commission to the Council and the European Parliament on the EU's Anti-Dumping, Anti-Subsidy and Safeguard activities and the Use of trade defence instruments by Third Countries targeting the EU in 2019 (2020), p. 44.
133 Judgment in Blaas (C-207/17, EU:C:2018:840, para. 31 and the case law cited).
134 See, to that effect, para. 17 of Textilwerke Deggendorf (C-188/92, EU:C:1994:90). The Court has confirmed the principle expressed in that judgment on a number of occasions. In that regard, see, inter alia, judgments in Nachi Europe (C239/99, EU:C:2001:101, paras. 30 and 37), in Pringle (C370/12, EU:C:2012:756, para. 41); in A and Others (C158/14, EU:C:2017:202, paras. 66 and 67 and the case law cited); and, most recently, in Georgsmarienhütte and Others (C135/16, EU:C:2018:582, paras. 14 and 15).
135 Judgment in Trace Sport (C-251/18, EU:C:2019:766).
136 id., at para. 28.
137 id., at para. 36.
140 id., at para. 37.
142 id. See also, for the requirement on sufficiency, judgment in TMK Europe (C-143/14, EU:C:2015:236, para. 26).
143 Judgment in TMK Europe (C-143/14, EU:C:2015:236).
144 See id., at para. 26, where this is made clear by the Court.
145 Changmao Biochemical Engineering v. Distillerie Bonollo and Others et Conseil (C-461/18 P, 23 April 2020).
146 Opinion of Advocate General Tanchev in Changmao (Case C-461/18 P, EU:C:2020:298, para. 85).
147 Judgment in Scuola Elementare Maria Montessori v. Commission (C-622/16 P to C-624/16 P, EU:C:2018:873, paras. 43 and 50).
148 id., at paras. 43 and 52.
149 Opinion of Advocate General Tesauro in Epicheiriseon Metalleftikon Viomichanikonkai Naftiliakon v. Council (C-121/86, EU:C:1989:299, p. 3930).
150 There is certainly an argument that the references in Article 3 of the Treaty on European Union to free and fair trade and Article 206 of the Treaty on the Functioning of the European Union to a contribution 'in the common interest, to the harmonious development of world trade [and] the progressive abolition of restrictions on international trade' instil also within the Union's external trade policy the idea of the same type of liberalising market order that initiated the European project ab initio.
151 Judgment in Zhejiang Jndia Pipeline Industry v. Commission (T-228/17, EU:T:2019:619). In that case, a Chinese exporting producer argued that the expiry of Section 15 of the Chinese Accession Protocol had the effect that the Commission could no longer use the non-market economy methodology contained in Article 2(7) of the basic Anti-Dumping Regulation as that possibility, in respect of China, expired on 11 December 2016. As explained in last year's review, the 'non-market economy' methodology allows the Commission to have recourse to data in a third country to replace domestic prices of Chinese producers, as prices in China are deemed not to be the normal result of market forces. Judgment in Xinyi PV Products (Anhui) Holdings v. Commission (T-586/14 RENV, EU:T:2019:669, para. 50).
152 See the judgments in Z (C-363/12, EU:C:2014:159, para. 72 and the case law cited) and Glatzel (C-356/12, EU:C:2014:350, para. 70 and the case law cited).
153 Judgment in Fediol v. Commission (Case C-70/87, EU:C:1989:254).
154 Judgment in Nakajima v. Council (C-69/89, EU:C:1991:186).
155 Recall that the Rusal Armenal line of case law that Article 2(7) of the basic Anti-Dumping Regulation is intended to lay down a special regime of detailed rules relating to the calculation of normal value, so that, in any case, that provision would fall outside the scope of the WTO agreements.
156 Judgment of 19 September 2019, Case T-228/17 Zhejiang Jndia Pipeline Industry v. Commission, EU:T:2019:619, paras. 110 to 114.
157 Opinion of Advocate General Bot of 26 March 2015, Case C-511/13 P Philips Lighting v. Council, EU:C:2015:206, para. 132.
158 Judgment of 2 April 2020, Case T-383/17 Hansol Paper v. Commission, EU:T:2020:139.
159 id., at para. 67. Needless to say, it might have helped that the limitation of the investigation 'resulted from an initial request made by the applicant', in express agreement with the applicant and the hearing officer.
160 id., at para. 67.
162 Judgment of 10 April 2019, Case T-301/16 Jindal Saw and Jindal Saw Italia v. Commission, EU:T:2019:234.
163 Judgment of 2 April 2020, Case T-383/17 Hansol Paper v. Commission, EU:T:2020:139, paras. 199 to 204.
164 Notice of initiation concerning the review of the safeguard measures applicable to imports of certain steel products, Official Journal of the European Union, C 169, 17 May 2019, p. 9.
165 Notice of initiation concerning a review of the safeguard measures applicable to imports of certain steel products, Official Journal of the European Union, C 51, 14 February 2020, p. 21.
166 Case T-245/19 Uzina Metalurgica Moldoveneasca/Kommission.
167 'Trade war spurs sharp reversal in 2019 Reshoring Index, foreshadowing COVID-19 test of supply chain resilience', Kearney, at http://www.kearney.com/operations-performance-transformation/us-reshoring-index">http://www.kearney.com/operations-performance-transformation/us-reshoring-index (last accessed 10 June 2020).
168 R E Baldwin, S J Evenett, 'COVID-19 and Trade Policy: Why Turning Inward Won't work', CEPR Press, 2020, p. 183, at https://voxeu.org/content/covid-19-and-trade-policy-why-turning-inward-won-t-work">https://voxeu.org/content/covid-19-and-trade-policy-why-turning-inward-won-t-work (last accessed 25 June 2020).