1.1. General Developments

1.2. Administrative Determinations

1.3. Court Cases

Dumping

1.1. General Developments

On 11 July 1988 the EC Council of Ministers adopted Regulation (EEC) No 2423/88.² In presenting its proposal to the Council of Ministers on 22 May 1988,³ the Commission had briefly reviewed the nature of the proposed amendments to the Regulation as follows:

It should be emphasized that the proposed amendments would not change the general orientation of the Community's anti-dumping policy which is based on Article VI of the GATT and the GATT Anti-Dumping Code. Furthermore, all the proposed modifications are essentially a codification of the consistent practice and approach of the Commission and Council in their application and interpretation of the present legislation and as such are essentially technical in nature.

To the extent that this summary creates the impression that the changes are merely a technical codification of existing practice which is furthermore in conformity with GATT and the GATT Anti-Dumping Code, it is misleading. Regulation 2423/88 introduces a number of new concepts the GATT-legality of which seems doubtful.⁴ In this respect, the following amendments come to mind:

- The anti-absorption procedure of Article 13(11) which introduces the requirement that anti-dumping duties be borne by importers and their customers in the Community;

- the exhaustive list of allowable direct-selling expenses (see Article 2(10)(c)); and

- the possible disregard of `insignificant' adjustments, i.e. individual adjustments having an ad valorem effect of less than 0.5 percent in relation to the price or value of the product under investigation (see Article 2(10)(e)).

These and other features of the amended basic Regulation have drawn criticism from other Code signatories in the meetings of the Committee on Anti-Dumping Practices. A number of signatories including the United States (which itself introduced significant changes in its anti-dumping law in 1988),⁵ Japan, Korea and Hong Kong have raised critical questions about the Regulation in this forum.

Japan challenges the `parts' amendment in GATT

On 29 July 1988 Japan requested consultations with the EC under Article XXIII(1) GATT and Article 15 of the Anti-Dumping Code concerning the `parts amendment'. The parts amendment was adopted by the EC Council in June of 1987 in an effort to deal with what it perceived to be circumvention of anti-dumping duties through the setting up of assembly operations in the European Community.⁶

Bilateral consultations under Article XXIII (1) GATT were held in September 1988 but failed to solve the dispute. Japan subsequently requested to institute a GATT Council in its meeting of 19-20 October 1988. Because of difficulties in formulating the terms of reference under which the panel was to operate, agreement on the composition of the panel and its terms of reference was reached only in May 1989.

The Japanese Government takes the position that Article 13(10) of Regulation No 2423/88 violates Articles I, II, III and IV of the GATT and cannot be justified under Article XX (d).

Whatever one may think about the GATT legality of the parts amendment, it is clear that the amendment has forced third country companies established in the EC to step up local sourcing activities. While at first sight the 60-40% rule seems preferable to the more vague origin rules applicable to products coming from third countries,⁷ experience with the first cases has shown that difficult problems may in fact arise, especially in determining the origin of sub-assemblies such as PCBs, etc.

Financial Times debate about EC anti-dumping practice

In the course of 1988 a lively debate ensued over some of the essential characteristics of the EC anti-dumping system. The forum was provided by the Financial Times. The discussion was initiated by Montagon and Buchan in an article published on 3 August 1988.⁸

Arguably stimulated by this and similar attacks on the Community's anti-dumping policy, the then-Commissioner with special responsibility for external relations, Mr De Clercq, vigorously defended the Commission's point of view in an article of 21 November 1988.⁹ In particular, Mr De Clercq stressed that the EC had always strictly applied the GATT rules and that, in fact, "(t)he Community's policy in this area ... differs from those of other countries in one fundamental respect, that is it is incontestably by far the most liberal."¹⁰

Mr De Clercq's position, in turn, was strongly attacked by Brian Hindley of the London-based Trade Policy Research Centre.¹¹ Hindley focused on the methodology employed by the EC Institutions to calculate dumping margins in the case of companies selling in their home market and the EC market through related sales companies and argued that in such cases the methodology led to titled results; Hindley's analysis was hardly new. Indeed, the same issue had been the main ground of appeal in the Ballbearings and the Typewriters cases brought in respectively 1984 and 1986 by Japanese producers.¹² In both cases, the European Court of Justice deferred to the discretion of the EC Institutions and upheld the administrative determinations. Nevertheless, Hindley's analysis raised a lot of dust, which presumably made it accessible to the public at large and because he was an `outsider' with no interest whatsoever in the outcome.

Since then, the debate has continued.¹³ One striking aspect of the discussion is its focus on EC anti-dumping law. In this respect, it should, in the opinion of this author, be noted that while there are undoubtedly protectionist elements in EC anti-dumping law and policy, it does not seem overall more protectionist than similar laws enacted and actively enforced by Australia, Canada and the United States. The exclusive focus on the EC therefore seems a bit misguided.

The Commission's sixth annual report on anti-dumping and anti-subsidy activities¹⁴

This sixth report reviews the Commission's activities in 1987. Like its predecessors, the report focuses mainly on statistical data and provides little insight to the Commission's thinking on substantive issues. The report notes that of the 39 anti-dumping investigations initiated in 1987, ten involved Japan and five Korea, these countries thereby being the main targets of the EC industry in that year.

1.2. Administrative Determinations

A unique feature of this investigation was the fact that only two Japanese producers of daisy wheel printers decided to cooperate. Not surprisingly, the EC Institutions used the `best information available' rule for the non-cooperating producers and found a dumping margin of 58% and an injury margin of 23.5% for this group. For them, the anti-dumping duty was therefore set at the level of the injury margin, i.e. 23.5%.

For the cooperating producers, Tokyo Electric and Tokyo Juki, on the other hand, the Commission found dumping margins of 21.05% and 22.01% respectively. The prices charged by these two producers, however, had not caused injury to the EC industry and, consequently, the producers were exempted from the duty imposed on the rest of the Japanese industry.

Other interesting issues: like product definition, OEM normal value, individual injury margins for the cooperating producers.

Copper sulphate from Bulgaria and USSR, OJ (1988) L 205/68 (provisional), OJ (1989) L 23/1 (definitive)

Following complaints by CEFIC that the exporters concerned had breached previously accepted undertakings, the Commission decided to initiate a review proceeding and impose provisional anti-dumping duties forthwith (in fact, on the same day). The level of the provisional anti-dumping duties - 39% for Bulgaria and 20% for the USSR - was based on the results of the original investigations conducted in 1984 (Bulgaria) and in 1987 (USSR).

The definitive dumping margins calculated in part on the basis of the prices for copper sulphate on the Mexican market (Mexico being the surrogate proposed by CEFIC and considered representative by the Commission) were 81% for Bulgaria and 79% for the Soviet Union. As is normal in cases involving non-market economies, the definitive anti-dumping duties of 58% for Bulgaria and 56% for the Soviet Union were based on the substantially lower injury margins established by the Commission.

Certain sheets and plates on iron or steel from Yugoslavia, OJ (1988) L 188/14 (definitive)

In this review proceeding under the ECSC Anti-Dumping Regulation, the Commission found a dumping margin of 15.4% using the `best information available' rule, and imposed a specific duty of 48 ECU/ton because of the `specific circumstances of the market ... in order to ensure the effectiveness of the measure."

Oxalic acid from Taiwan and South Korea, OJ (1988) L 184/1 (definitive) (acceptance undertaking Uranus (Taiwan))

A unique aspect of the Oxalic Acid from Taiwan and South Korea proceeding was the modification of the `best information available' rule. Use of the best information available is standard practice in the EC and in other jurisdictions in cases where parties choose not to participate or do not sufficiently cooperate.¹⁵ In cases where foreign exporters fail to sufficiently cooperate, the EC typically bases its determination on the allegations made by the EC industry in the complaint.

Accordingly since the Korean industry decided not to cooperate in the proceeding, the Commission - in its provisional determination - calculated the dumping margin for Korea on the basis of the information supplied in the complaint. This, however, led to imposition of duties on Korean exports lower than the duties imposed on the cooperating Taiwanese producers.

To rectify the disparity, in its definitive determination, the EC Institutions imposed the Taiwanese duty of 20.21% also on Korean exports on the ground that "the imposition of a lower duty on the South Korean product than that imposed on a product originating in a country which had cooperated with the investigation would reward non-cooperation and make it possible to evade duties." The EC institutions therefore went further than the allegations in the complaint.

Oxalic acid from China and Czechoslovakia, OJ (1988) L 343/34 (acceptance undertakings, termination)

This sunset review proceeding well illustrates the difficulties the Community Institutions encounter when determining normal value in cases involving non-market economies. Initially, the Commission considered using South Korea, Taiwan, Japan, Brazil and India as analogue for the non-market economies of China and Czechoslovakia; in the end, however, it was forced to base normal value on the prices of the same Spanish producer who had requested the review, DAVSA, thereby elevating prices of an EC producer to the norm for acceptable pricing behaviour. This is the first time that the Commission used this last possibility provided for in Article 2(5)(c) of the basic Anti-Dumping Regulation.

By comparing the prices of DAVSA with the export prices of the Chinese and Czechoslovakian producers, the Commission established dumping margins of 53.73% for Chinese exports, 1.87% for products exported by Chemapol and 41.17% for other Czechoslovakian exports. The Commission found margins of price undercutting of 42.44% for the Chinese exports and 19.78% for the Czechoslovakian exports.

The Commission then decided to accept undertakings from the two main exporters Sinochem and Chemapol. Interestingly enough, the Commission refrained from its usual practice of imposing a residual duty on the rest of the industry.

Certain iron or steel coils from Algeria, Mexico and Yugoslavia, OJ (1988) L 188/18 (definitive)

In this ECSC proceeding, the Commission imposed specific duties of 15 ECU/ton on Algerian exports, 50 ECU/ton on Mexican exports (except for coils produced by Hylsa and exported by Hylsa International with respect to which duties of 39 ECU/ton were imposed) and 64 ECU/ton on Yugoslavian exports.

Certain iron or steel sections from Yugoslavia and Turkey, OJ (1988) L 190/8 (provisional); OJ (1988) L 313/18 (definitive; acceptance undertakings)

The Commission found dumping margins of 38.2% for Yugoslavian exports (based on `best information available') and of 36.5% and 15.5% for the Turkish exporters IDC/IZDAS and CEMTAS respectively. The provisional anti-dumping duties, however, were based on the substantially lower margins of price undercutting of 16% for Yugoslavia, 11.8% for IDC/IZDAS and 5% for CEMTAS.

In the definitive determination, the Commission accepted undertakings from the Turkish producers who had cooperated and from a Yugoslavian producer. In accordance with standard practice, the Commission imposed residual duties of ECU 39/ton (Yugoslavia) and ECU 30/ton (Turkey) based on the highest margins of price undercutting found with respect to producers in each country.

Despite arguments made to the contrary by the Turkish producers/exporters, the Commission decided to aggregate Turkish and Yugoslavian exports on the basis of their similarities in "quality, distribution channels, final utilization and prices on the Community market."

Video cassette recorders from Korea and Japan (Orion and Funai), OJ (1988) L 240/5 (provisional); OJ (1989) L 57/55 (definitive); OJ (1989) L 57/61 (acceptance undertakings)

Together with the Printers and Video Cassette Tapes proceedings, this was probably the most important proceeding during the review period, not only in terms of development of EC anti-dumping law but also because it was the first case in which the EC found substantial dumping margins for Korean companies.

The VCR complaint was the first complaint in the EC to be aimed at specific producers in one country, namely Japan. The Commission accepted the complaint on this basis and rejected arguments made by the foreign producers that selective complaints were discriminatory and manipulative, stating:

The Commission decision to initiate the present investigation against exporters in South Korea and against Funai and Orion only was based on the complaint which was expressly limited to Korea and the two Japanese firms and which did not contain any evidence of dumping or injury from any other source. At this time there was no other evidence available to the Commission which would have indicated that other imports from Japan or other countries were dumped, or that they were causing injury. Under these conditions the Commission did not in any way behave in a discriminatory manner.
The Commission is not legally required to always initiate anti-dumping proceedings against all exporters in a country concerned. There is nothing in Community law that requires the Commission to extend the scope of the investigation to all imports from a given country.
It is the Commission's practice to open investigations against all imports from a given country because, in most cases, the evidence available suggests that all imports from a certain country are dumped and are causing material injury. In the present case, not only did the evidence available not show this to be the case, but the complainant had expressly limited the complaint to certain exporters.
The Commission naturally asked itself whether the complainants' request to limit the investigation to certain companies was abusive. Allegations that the complainants had filed the complaint selectively because of their links with other exporters were not considered convincing in this respect. Indeed, in other anti-dumping cases, the same complainant companies had not hesitated to lodge a complaint against Japanese companies with which they cooperate in other areas.
As to the question of whether, subsequent to the initiation, the Commission should have extended the proceeding to include other exporters, the Commission has examined the information from the exporters about these allegedly dumped exports causing injury and found that there is no evidence at all for dumping on the basis of the data submitted which, apart from doubtful methodology, was neither supported by any documentation nor information. Nor is there evidence that the Community industry was prevented from charging prices including a reasonable profit in order to keep its market share in the face of competition from these other exporters.

Moreover, independent and representative market surveys available to the Commission showed no continuous price undercutting or gain of market share by these other suppliers as it could be found for the producers involved in the proceeding.

The Community Institutions found dumping margins ranging from 11.5% to 23.7%, but accepted price undertakings from four of the five exporters involved in the proceeding. A duty of 13% was imposed on the Japanese producer Orion while Korea was subjected to a residual duty of 23.7%.

Other interesting issues: like product definition, OEM normal value (5% profit), use of 12.7% subsidiaries' profit in the reconstruction of the export price (the highest profit margin ever used for this purpose), individual injury margins.

Paint, distemper, varnish and similar brushes from China, OJ (1988) C 257/5 (notice of reopening); OJ (1988) L 272/16 (provisional); OJ (1988) L 303/11 (amendment provisional); OJ (1989) L 79/24 (definitive)

After finding evidence that the Chinese exporter, the China National Native Produce & Animal By-Products Import and Export Corporation had broken its quantity undertaking, the Commission decided to reopen the proceeding and immediately apply provisional anti-dumping duties of 69% on brushes produced and/or exported by the Chinese company.

This duty was later extended to all Chinese exports of paint brushes following a finding by the Commission that the Chinese company could not control the activities of its various subsidiaries and that exports were, in fact, coming from several sources.

The Commission found a dumping margin of over 90% based on prices in Sri Lanka. The Commission used Sri Lanka as a surrogate country despite contentions of EC importers that Sri Lanka was an inappropriate choice since: the Sri Lanka products were different; the production costs were different; the production volume was much smaller; Sri Lanka was not a significant exporter; there was insufficient competition in Sri Lanka (only two producers); and one of the two Sri Lanka producers was owned by a Community firm.

The last objection perhaps deserved more weight than the Commission gave it. One general problem with the analogue country, or - more precisely - analogue producer, concept is that the analogue producer concerned has no interest in showing a low normal value. Presumably its only interest is to provide the EC Commission with the desired information at the smallest expense possible. Needless to say, the analogue producer does not spend time thinking about adjustments which would normally be made to reduce the normal value. Where an analogue producer is related to an EC complainant, however, the producer not only has an interest in cooperating but also has an interest in showing a high normal value. Such a producer may therefore reasonably be expected not to claim any adjustments at all.¹⁶

In the end, the Council decided to impose definitive anti-dumping duties of 69%, based on the injury margin.

Serial impact dot matrix printers from Japan, OJ (1988) L 317/33 (definitive)

In terms of trade value of imports, the Dot matrix proceeding was the biggest in EC anti-dumping case ever.

In this case, the Community Institutions applied a continuum principle in their definition of the like product. The Commission decided (and the Council agreed) that in situations where there is a spectrum or continuum of products, it would be "arbitrary, open to circumvention and probably unworkable to separate the products into a number of separate articles or series of like products." As a result, all printers were lumped together.¹⁷

The Commission found dumping margins between 4.8% and 86% and injury margins between 4.8% and 47%. The Community Institutions gave the following explanation for their decision to calculate injury margins on a producer-by-producer basis:

(I)t has to be noted that injury can be determined on the basis of numerous factors. When assessing whether a duty below the dumping margin established would be adequate to remove the injury, difficult and complex economic appreciations are necessary which imply inevitably a certain use of discretion. In this context, the Council is of the opinion that in this case the effects of dumping resulted substantially in the Japanese exporters selling at lower prices than the Community industry. The reference to price undercutting and the use of target price, at which the Community would have sold had the dumping not occurred are therefore, in the opinion of the Council, proper means to establish the extent of the injury. Since the price undercutting margins were individually calculable and varied considerably, the Council is of the opinion that in the present case the amount of the price undercutting of one exporter should not be used for the duty calculation of another exporter.

It would seem from the above excerpt that the Community Institutions prefer the use of individual injury margins where such margins are individually calculable and vary substantially.

Other interesting issues: use of 37% profit margin in constructed value of those Japanese producers who had insufficient or unreliable home market sales.

Paracetamol from China, OJ (1988) L 348/1 (definitive)

The Council decided to impose a variable duty.

Synthetic fibres of polyesters from Mexico, Romania, Taiwan, Turkey, USA, Yugoslavia, OJ (1988) L 348/49 (definitive)

Following their decision in the earlier Polyester Yarn proceeding, the Community Institutions again rejected arguments made by a foreign exporter - in this case Romania - that imposition of anti-dumping duties is inappropriate in cases where the product concerned is already covered by quantitative restrictions pursuant to the MFA. The Council noted that neither Community law nor international rules (including the MFA) prohibit the imposition of anti-dumping duties, customs duties or any other measure affecting imports subject to quantitative restrictions provided it is established that injury has been caused despite the restrictions. As the quantitative restrictions applied only to the Benelux and Italy, and as over 80% of Romanian exports went to Germany at injurious price levels, the Council believed that anti-dumping measures were necessary.

Another interesting feature of this case is that the EC decided to exclude a number of U.S. producers from the imposition of anti-dumping duties despite the fact that at least some of them were dumping (BASF: 23.1%; Eastman Chemical: 9.9%; Celanese Fibers: 9.2%). This exclusion was a consequence of the Commission decision in the provisional determination that exports of U.S. producers (as opposed to exports of U.S. dealers) should not be cumulated with exports of other producers because the physical characteristics of the U.S. products generally differed from those of Community products and other imported products and because the U.S. exports did not complete with Community production and other imports on account of their price levels. It should be noted that it is rather exceptional for the EC Institutions to de-cumulate.

Under the Community interest heading, the EC Institutions rejected importers' and users' arguments regarding supply difficulties and the high prices charged by, and the cartel-like behavior of, EC producers. Nevertheless, the Institutions decided to suspend application of anti-dumping duties for five months on one product - fiberfill - subject to the outcome of a further investigation into supply difficulties.

Video cassettes and video tape reels from Korea and Hong Kong, OJ (1988) L 356/47 (provisional); OJ (1989) L 174/1 (definitive); OJ (1989) L 174/30 (acceptance undertaking Wing Shing)

In the EC, definitive anti-dumping duties tend to be similar to provisional anti-dumping duties. The Video tape proceeding was an exception to this in that the definitive duties were substantially lower than the provisional duties, as can be seen from the following comparison:

The Institutions refrained from imposing duties on pancakes exported by the Korean companies Saehan and SKC because the dumping margins (1.06% and 1.4% respectively) were de minimis.

As far as procedure is concerned, the Community Institutions modified standard practice with regard to the imposition of a residual duty in two respects. Until this proceeding, a residual duty set at the level of the highest dumping margin found for any producer cooperating in the proceedings was applied to all producers in the same country who had either not cooperated or cooperated insufficiently or who had not exported during the investigation period (so-called newcomers).

In this case, however, the Council decided that it would be inappropriate to apply the highest dumping margin found for fully cooperating Hong Kong producers to those Hong Kong producers who "for specific reasons of the companies" had not been able "to provide the necessary information on all the points necessary for a due dumping calculation." With regard to such companies, the Council decided to impose instead the weighted average dumping margin found for the Hong Kong exporters (9.3% instead of 21.9%).

Secondly, although the Council was not willing to extend the application of this weighted average margin to newcomers, it noted (presumably with approval) the Commission's willingness to initiate without delay a review proceeding for newcomers who are able to prove:

- that they did not export to the EC during the investigation period;

- that they only started exporting afterwards; and

- that they are not related to or associated with any of the companies subject to the present investigation.

While the Council's decision to impose a weighted dumping average on producers which did not cooperate fully may be limited to the specifics of this proceeding, its willingness to initiate review proceedings for bonafide newcomers should be applicable to all future cases since the modification of standard practice is couched in general language and refers to an objectively identifiable factual situation. As an effort to deal with the plight of newcomers in the EC anti-dumping system, this modification should be applauded. It should be noted, however, that it does not alleviate the structural problem inherent in the EC system that plagues newcomers, specifically, that once the newcomers have been saddled with the highest dumping duty found, it may well be impossible for them to start exporting at all.¹⁸

Cellular mobile telephones from Canada, Hong Kong and Japan, OJ (1988) L 362/59 (termination)

The Commission determined that during the (six months) investigation period the sole European producer, Motorola, was able to increase both production and market share as well as improve its financial results and therefore did not suffer injury. In view of this, the Commission did not find it necessary to investigate the dumping allegations. Following withdrawal of the complaint by Motorola (after having been informed by the Commission of its findings), the Commission terminated the proceeding.

Certain seamless tubes of iron or non-alloy steel from Austria, OJ (1989) L 25/87 (termination)

The proceeding was terminated on the basis of `no injury' because the market share of the Austrian exports was less than 1% and such a quantity could not cause material injury, especially when compared to the impact of other trends, such as the heavy decline in demand.

Wheeled loaders from Japan, OJ (1989) L 39/35 (termination)

After having been informed by the EC Commission that Japanese producers had not materially undercut the prices of EC producers and that, in fact, the situation of the EC producers seemed healthy, the complaining EC producers withdrew their complaint and the Commission terminated the proceeding without further examining the dumping allegations.

Low carbon ferro-chromium from South Africa, Turkey and Zimbabwe, OJ (1989) L 39/33 (termination)

After having been informed that there was no dumping, the EC industry withdrew its request for review and the Commission terminated the proceeding without further investigating the injury allegations.

Certain flat-rolled products of iron or non-alloy steel cold-rolled, from Yugoslavia, OJ (1989) L 78/14 (provisional)

Having found dumping (15.4%) and injury (price undercutting of 14.75%), the Commission imposed a specific duty of ECU 54/ton.

Calcium metal from China and the Soviet Union, OJ (1989) L 78/10 (provisional)

Using the United States as the analogue country, the Commission found dumping margins of 27.2% (China) and 19% (Soviet Union) and price undercutting margins of 10.7% (China) and 11.2% (Soviet Union). A provisional anti-dumping duty of 10.7% was imposed on both countries.

Iron or steel coils from Argentina and Canada, OJ (1989) L 112/5 (termination)

The Commission decided to terminate this review proceeding on the basis of `no injury' in view of the small market share of the two countries (combined less than 1%) and the absence of price undercutting.

Light sodium carbonate from Bulgaria, GDR, Poland, Romania, OJ (1989) L 131/4 (definitive)

Using Mexico as the analogue country, the Commission found dumping margins in excess of 58% (Poland), 67% (Bulgaria), 35% (Romania) and 64% (GDR). Although the market share of the countries under investigation had dropped from 17% in 1882 to 4% since 1983 (when anti-dumping duties were imposed), the Council decided not to let the anti-dumping duties sunset because there was a threat of injury. The Council imposed a definitive duty equal to the difference between a minimum price and the price charged by the exporters.

Fibre building board (hardboard) from Czechoslovakia, Poland and the Soviet Union, OJ (1989) L 176/1 (termination); Romania, Brazil and Sweden, OJ (1989) L 176/51 (termination)

The Commission decided to terminate the proceeding on the basis of `no injury' without further investigating the dumping allegations. The basis for the negative injury determination was formed by findings that the imports had not undercut or had not significantly undercut Community producers' price levels, that the imports did not really compete with the hardboard produced by the Community industry and that the situation of the Community industry had in fact improved during the reference period.

Parts cases

See the tables in the appendix.

1.3. Court Cases

A Russian exporter of deep freezers brought this appeal contesting a 1987 Council regulation which imposed a definitive anti-dumping duty of 33% on upright freezers from the Soviet Union. Technointorg challenged the calculation of the normal value as well as certain aspects of the injury determination.

The Court rejected Technointorg's appeal on all counts. Noteworthy is that the Court agreed with the Council that - under EC anti-dumping law - there is no room for adjustments to take account of differences between the products exported by the non-market economy producer and the products manufactured by the analogue producer to the extent that such differences are not covered by Articles 2(9) - 2(10) of the basic Regulation. The claims of Technointorg for adjustment for differences in income level and in the cost of components were consequently rejected.

The Court referred to its judgment in the Ballbearings cases¹⁹ to uphold the Community Institutions' determination to cumulate imports from all sources.²⁰

Cases 260/85 and 106/86, Tokyo Company Ltd. a.o. 273/85 and 107/86, Silver Seiko Ltd., Silver Reed (U.K.) Ltd. and Silver Reed International GmbH, 277/85 and 300/85, Canon Inc., Canon France S.A., Canon Rechner Deutschland GmbH and Canon (U.K.) Ltd., 301/85, Sharp Corp., 308/85, Nippon Seiko KK v. Council, Judgments of 5 October 1988 (Typewriters) (not yet reported)

The Court dismissed all applications filed by Japanese exporters contesting a 1985 Council Regulation imposing definitive anti-dumping duties on Japanese exports of typewriters. The applications had mainly challenged the methodology the Community Institutions employ to calculate normal value and export price in cases where foreign producers target their home market and the EC.

After the Court's 7 May 1987 judgments in the Ballbearings cases, the Court's judgments did not come as a surprise.

2 Council Regulation (EEC) No 2423/88 of 11 July 1988 on protection against dumped or subsidized imports from countries not members of the European Economic Communities, OJ (1988) L 209/1. The Regulation entered into force on 5 August 1988. The comparable ECSC Regulation 2424/88/ECSC of 29 July 1988, OJ (1988) L 209/18, entered into force on the same day. For commentaries on the amended regulation, see Bellis, Vermulst, Waer, `Further Changes in the EEC Anti-Dumping Regulation: A Codification of Controversial Methodologies', 23 Journal of World Trade (No. 2) (1989) 21-34; Vermulst, Waer, `De Nieuwe EEG Anti-Dumping Verordening 2423/88: Een Stille Revolutie', 37 Sociaal Economische Wetgeving (1989) 151-162; Van Bael, `EEC Anti-Dumping Enforcement: An Overview of Current Problems', EJIL, Section II (1989); Hailbronner, Bierwagen, `Neuere Entwicklungen im Außenwirtschaftsrecht der Europäischen Gemeinschaften', 22 NJW (1989) 1385-1394; Norall, `The New Amendments to the EC's Basic Anti-Dumping Regulation', 26 CML Rev. (1989) 83-103.

3 Proposal for a Council Regulation (EEC) amending Regulation (EEC) No 2176/84 on protection against dumped or subsidized imports from countries not members of the European Economic Community, presented by the Commission, COM (88) 112 final, Brussels 22 March 1988, at 3.

4 For more extensive analyses of the amended Regulation, see the Articles supra note 1.

5 For a description of the U.S. amendments, see Holmer, Bello, `The 1988 Trade Bill: Is it Protectionist?', 5 I.T.R. (1988) 1347-1351; Horlick, Oliver, `Anti-Dumping and Countervailing Duty Law Provisions of the Omnibus Trade and Competitiveness Act of 1988', 23 Journal of World Trade (No. 3) (1989) 5-51.

6 For analyses of the parts amendment, see, e.g., Van Bael, `Japanese Investment in the EEC: Trojan Horse or Hostage?', International Financial Law Review (June 1987) 10; Bierwagen, Hailbronner, `Input, Downstream, Upstream, Secondary, Diversionary and Components of Subassembly Dumping', 22 Journal of World Trade (No. 3) (1988) 27; Hailbronner, Bierwagen, `"Neue" Formen des Dumping und ihre Regelung im Außenwirtschaftsrecht der Europäischen Gemeinschaften', 9 RIW (1988) 705; Landsittel, `Antidumpingzolle auf in der Gemeinschaft hergestellte Waren', WRP (1988) 21; Griffith, `Anti-Dumping Duties on Parts in the EEC', in Jackson & Vermulst (eds.), Anti-Dumping Law and Practice: A Comparative Study (to be published by University of Michigan Press 1989); Steenbergen, `Circumvention of Anti-Dumping Duties by Importation of Parts and Materials: Recent EEC Anti-Dumping Rules', 11 Fordham International Law Journal (1988) 382; Desmedt, `EC Anti-Dumping Law: EC Applies Duties to Foreign-Owned Assembly Operations in the EC', International Business Lawyer (1987) 479; Dermott, `Extending the Reach of their Anti-dumping Laws; The European Community's "Screwdriver" Assembly Regulation', 20 L. & Pol'y Int'1 Bus. (1988).

7 The `normal' EEC origin rules are contained in Regulation (EEC) No 802/68. The operative Article 5 provides in relevant part that "(a) product in the production of which two or more countries were concerned shall be regarded as originating in the country in which the last substantial process or operation that is economically justified was performed, having been carried out in an undertaking equipped for the purpose, and resulting in the manufacture of a new product or representing an important stage of manufacture." See also Case 229/86 Brother v. Council, Judgment of 30 September 1987 (not yet reported); Case 26/88, Brother International GmbH v. Hauptzollamt Giessen. The origin Regulations on photocopiers and integrated circuits are discussed in Section 3 infra.

8 Montagnon, Buchan, `Stretching the GATT to its limit', Financial Times (3 August 1988).

9 De Clercq, `Fair practice, not protectionism', Financial Times (21 November 1988).

10 Mr De Clercq's statement was repeated almost verbatim by his successor, Mr Andriessen, in a speech for the Financial Times' Eleventh Conference on World Electronics, where Mr Andriessen said the following about the EC's anti-dumping policy:

"Our anti-dumping policy constitutes another example that the Community defends its rights and interests promptly and consistently. We have always supported the elaboration of internationally acceptable rules in that area in accordance with the existing GATT legislation. Community policy however differs from those of other countries in one fundamental respect: our policy is incontestably the most liberal, by far.

Every case is carefully examined in order to ensure that the anti-dumping measures eliminate dumping which is causing injury to Community Industry and re-establish a situation of open and fair competition on the Community market which is in the general Community interest."

See Andriessen, `Trade Issues for the Electronics Industry', Financial Times, Eleventh Conference on World Electronics, London (27 April 1989).

11 Hindley, `Cleverness can cost too much', Financial Times (25 November 1988), and - especially - Hindley, `The Design of Fortress Europe', Financial Times (6 January 1989). Hindley explains his views in more detail in Hindley, `Dumping and the Far East Trade of the European Community', 12 The World Economy (1988).

12 Ballbearings cases 240/84, NTN Tokyo Bearing Company Ltd., 255/85, Nachi Fujikoshi Corporation, 216/84, Koyo Seiko, 258/84, Nippon Seiko KK, 260/84, Minebea Company Ltd. v. Council, Judgments of 7 May 1987 (not yet reported); Typewriters cases 260/85 and 106/86, Tokyo Electric Company Ltd. et al., 273/85 and 107/86, Silver Seiko Ltd., Silver Reed (U.K.) Ltd. and Silver Reed International GmbH, 277/85 and 300/85, Canon Inc., Canon France S.A., Canon Rechner Deutschland GmbH and Canon (U.K.) Ltd., 301/85, Sharp Corp., 308/85, Nippon Seiko KK v. Council, Judgments of 5 October 1988 (not yet reported).

13 See, e.g., Messerlin, `EC Anti-Dumping Policy: Un chat est un chat', Financial Times (15 December 1988); Norall, `Dumping dilemma', Financial Times (23 December 1988); Gestetner, `EC Anti-Dumping Actions', Financial Times (6 January 1989); Randolph, `"Fortress Europe" and EC Anti-Dumping Actions', Financial Times (17 January 1989); Norman, `EC Anti-Dumping Actions', Financial Times (17 January 1989); Krenzler, `Fortress Europe is a Myth', Financial Times (19 January 1989); Hindley, `Correcting the Defects of EC Dumping Regulations', Financial Times (24 January 1989); Spinanger, `How Open is an "Open" Market', Financial Times (3 February 1989); Bronckers, Hoogakker, Quick, `The Role of Consumer Interest in EC Trade Restrictions', Financial Times (14 March 1989); Farr, `In the Interests of EC Consumers', Financial Times (17 March 1989). See also Nelson, `Fighting Back', Wall Street Journal (21 June 1989).

14 Sixth Annual Report of the Commission on the Community's Anti-Dumping and Anti-Subsidy Activities, COM (89) 106 final, Brussels, 21 March 1989.

15 See Vermulst, `The Anti-Dumping Systems of Australia, Canada, the EEC and the U.S.A.: Have Anti-Dumping Laws Become a Problem in International Trade?' in Jackson & Vermulst (eds.), Anti-Dumping Law and Practice: A Comparative Study (to be published by University of Michigan Press 1989).

16 For overviews of the EC's anti-dumping policy vis-à-vis non-market economies, see Vandoren, `Mise en œuvre de la politique antidumping de la CEE contre les importations en provenance des pays à commerce d'état', Revue du Marché Commun RMC (1988) 198; Denton, `The Non-Market Economy Rules of the European Community's Anti-Dumping and Countervailing Duties Legislation', 36 International & Comparative Law Quarterly (1987) 198-239.

17 In the early eighties, a majority of the U.S. International Trade Commission also applied the continuum principle, especially in preliminary determinations. See E. Vermulst, Anti-Dumping Law and Practice in the United States and the European Communities (1987) 524-526 for more detail.

18 Since publication of the definitive duties, the Hong Kong Government has formally requested bilateral consultations with the EC on this proceeding under Article 15(2) of the GATT Anti-Dumping Code.

19 Supra note 11. For an analysis of the judgments, see Vermulst, Waer, `Zaken 240/84 NTN Toyo Bearing Company Ltd, 255/84 Nachi Fujikoshi Corporation, 216/84 Koyo Seiko, 258/84 Nippon Seiko KK en 260/84 Minebea Company Ltd. vs. Raad EG', 36 Sociaal Economische Wetgeving (1988) 106.

20 For more extensive discussions, see Waer, Vermulst, `Hof van Justitie der Europese Gemeenschappen - Zaken 294/86 Technointorg vs. Commissie, 77/87 Technointorg vs. Raad - Arrest van 5 October 1988: Diepvriezers uit de Soviet Unie: De koude oorlog', 37 Sociaal Economische Wetgeving (1989); Herman, `Anti-Dumping and the Euro Court', Financial Times (17 November 1988); `European Court upholds EC Anti-Dumping Duties on Soviet Freezers', Business Law Brief (13 November 1988).

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