Commercial Defence Actions and Other International Trade Developments in the European Communities: 1 July 1991 - June 1992
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Abstract
This is the fourth in the series of annual reports on developments in the field of EC international trade law.3 This report will cover developments that occurred during the period 1 July 1991 to 30 June 1992.
1. Dumping
1.1. General Developments
Uruguay Round
Only the GATT Anti-Dumping Code will be discussed under Section 1. For an overall evaluation of two other agreements reached in the Uruguay Round, which would most substantially affect the Common Commercial Policy, see below.
On 20 December 1991, the definitive version of the revised GATT Anti-Dumping Code was presented to the GATT Contracting Parties. The draft Code is an improvement compared to the 1979 Code in that the latter left too much room for discretion in the hands of importing country authorities, which led to diverging and unilateral interpretations. This, in turn, resulted in uncertainty and unpredictability.
In view of the serious consequences that anti-dumping action may have on the development of enterprises and, indeed, industries, it is imperative that anti-dumping laws enable possible victims to assess dumping liability in advance. Business community members must have the opportunity to avoid such findings on the basis of conscious cost and pricing strategies.
This predictability factor is perhaps even more important than the actual substance of the rules. For example, experience in the EC with amended Article 13(10) showed that once the `rules of the game' were clearly established by the EC,4 it became possible to abide by such rules. On the other hand, it is obvious that fair rules will create more incentive to comply. From that perspective, it is in the interests of all parties, including importing country industries, that the rules and the interpretation thereof are perceived to be fair and unbiased.
While the increased predictability value of the draft Code can be applauded without reservation, a more careful conclusion is appropriate with respect to the substance of the changes. The definitive draft of the Code has become more `user-friendly' than its predecessors. For victim countries, this is unfortunate. Compared to the 1979 Code, however, the Code can be characterized as an improvement on many substantive and procedural points which, if implemented fully by user countries, will force a roll-back of some dubious national practices that have developed since 1979.
Remaining uncertainties are likely to be challenged and may therefore be clarified in the course of the improved dispute settlement proceedings. In view of the present unsatisfactory appeal possibilities in the EC, this is a welcome development for foreign companies which have been treated unfairly by the EC Commission in administrative proceedings.
Compared to, for example, US anti-dumping proceedings, EC anti-dumping proceedings are characterized by enormous discretion on behalf of the EC case handlers and it is necessary to subject such discretion to a system of meaningful checks and balances. It is to be hoped that any improved GATT dispute settlement mechanism can fill this gap in legal protection in the European Communities. A number of individual Code provisions have been criticized elsewhere, and such critique will not be repeated here.5
What the draft Code does not do is bring into question whether or not anti-dumping laws make sense as such, for example from an economic or competition law perspective. In fact, it could be said that the Code does the contrary in legitimizing concepts such as dumping based on findings of sales below cost and circumvention. While this may be regrettable, it was clear from the outset of the negotiations that the time for such fundamental discussion had not yet come. For the time being, anti-dumping laws do perform a, probably necessary, outlet for domestic protectionist pressures and as such they are preferable over alternatives such as selective safeguards or other forms of targeted import protection.
Summary of Dunkel Text
The draft Anti-Dumping Code is a compromise between the interests of mai
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