Evasion And Anti Circumvention: A Game That Can Not Be Stopped

Recently, EU members voted unanimously to adopt a regulation that decided to extend the anti-dumping duties imposed on leather shoes originating in the mainland of China and Vietnam in October 7, 2006 and apply to Macao.

This means that the export of leather shoes from Macao to EU Member States will also be subject to an anti-dumping duty of up to 16.5%.

Since the EU imposed anti-dumping duties on leather shoes in the mainland and Vietnam, the number of shoes exported from Macao to the EU has increased to 4 times.

The European Commission is of the view that in the production of leather shoes, because of the limited production facilities in Macao, it is impossible to achieve such a huge increase unless it is pferred from mainland China to Macao.

In this sense, the manufacturers of leather shoes in the mainland suspected of evading the anti-dumping duties previously identified, and decided to apply anti circumvention measures to them.

The so-called circumvention refers to the fact that a country's goods are expropriated by another country or subjected to its anti-dumping investigation, so as to continue exporting the goods to another country, producers or exporters can adopt some form or method to avoid the Levy of anti-dumping duties.

The investigation of such methods or behaviors by importing countries is anti circumvention.

Anti circumvention is the extension and extension of anti-dumping.

Once the importing country finds that the anti circumvention is established, the anti-dumping duty will be applied to the imported product.

The EU has taken the following key facts and evidence into consideration when deciding to circumvent the fact: the actual production and export situation of leather shoes in Macao before the anti-dumping duty on leather shoes in the mainland; notable changes in the export volume of leather shoes before and after the collection of dumping duties at specific time points; and the "60% rules" and "25%" rules.

Due to the fact that the export volume of leather shoes in Macao is not large or even shrinking after the anti-dumping duties imposed on leather shoes in the mainland of China, the export of leather shoes has increased sharply after the acquisition. On the basis of this fact, it is very difficult for mainland leather shoes manufacturers to escape the suspicion of using the Macao pit platform to circumvent the EU's anti-dumping duties previously determined.

From the overall and long-term perspective, as long as there is trade protectionism, there are trade comparative advantages, evasion and anti circumvention are just like a game that can not be stopped: any party involved, like the "bicycle theory" described in international trade, can not stop stampeding in this process; if any party stops pedaling first, the bicycle will suddenly stop and fall down.

If we look at the practice of circumvention and anti circumvention in this sense, we will find that it reflects the essence of trade.

Therefore, it is necessary for us to formulate long-term and overall coping strategies, whether at policy level or in response to specific enterprises, instead of looking forward to resolving trade frictions and disputes in a short time.

Therefore, in view of the anti-dumping and anti circumvention investigations launched by Europe and the United States on our products, we should study the overall coping strategies at the substantive level.

The author thinks that we can start from the following aspects: (1) the government should actively intervene.

To avoid the application of anti circumvention measures to our products, the key is to reduce the application of anti-dumping measures.

In this regard, in addition to actively negotiating with Europe and the United States to recognize China's market economy status, China should also pay attention to the fact that when the European Union or the United States may launch anti-dumping investigations against our products, the competent authorities should actively coordinate closely with relevant trade associations to formulate a unified and effective coping strategy.

In this regard, the main purpose of the "Regulations on responding to anti-dumping cases of export products" formulated by the Ministry of Commerce in 2006 may also be here.

(2) the state should break the silence in the negotiation of anti circumvention and actively participate in the negotiations on anti circumvention in WTO.

In the negotiations on anti circumvention in WTO, there are two kinds of tit for tat camps: the support camp represented by the European Union and the United States, they support the improvement and clarity of anti circumvention rules, and they advocate inaction in this issue with the restrictions or opposition camps represented by Japan and South Korea.

As Japan and South Korea and China are one of the main target countries for anti-dumping, we should maintain a consistent position with Japan and South Korea and join the same voice in negotiations on anti circumvention.

Only in this way can we better protect our own interests.

(3) trade associations should play an active coordinating role.

First of all, trade associations should maintain close ties with the competent authorities.

In addition to timely notification of relevant information, the trade associations should, if necessary, even proactively lobby the state, Chen Ming's interest relationship and request the state to take an active part in it. If necessary, they should regularly or unnecessarily carry out training in anti dumping and anti circumvention knowledge and skills, and, as far as possible, suggest or urge enterprises to conduct trade exportation in an orderly way.

(4) as far as the enterprise itself is concerned, in addition to carrying out enterprise accounting treatment according to the international common practice, in dealing with anti-dumping, we should take the overall situation into consideration and take concerted action as far as possible, instead of giving up the acquired market easily. On the choice of evasion, we should first note the existing system of the exporting country; besides, more importantly, enterprises should speed up industrial upgrading, step out the competition in the low-end market as soon as possible, and improve the quality and added value of products. Only in this way can we fundamentally get rid of the nightmare of antidumping.

The European Commission: responsible for anti-dumping investigation and dumping and damage identification; the European Union anti-dumping Advisory Committee: the EU Member States anti-dumping joint standing conference bodies, responsible for the European Commission's findings; Council of the European Union: responsible for anti-dumping decisions; European Court of first instance and European Supreme Court: responsible for anti-dumping judicial review.

Two, the EU defines four basic elements of Taxation: the existence of dumping; the existence of damage; and the causal relationship between dumping and damage; and taxation is in line with the common interests of the European community.

Three, the calculation method of dumping: dumping margin = normal value - the normal value of export price can be divided into: A: domestic price; B: cost structure price; C: export to third country price adopt the condition of export domestic selling price.

The conditions for export domestic sales are: 1. the market economy countries - the price reflects market information; 2., the number of domestic sales accounts for more than 5% of the EU's export volume - there is a certain number of representativeness; 3. the domestic price is no less than the cost - the normal trade situation.

Four, the examination conditions of market economy status: enterprise's decision on price, cost and input, including raw material, technology and labor cost, output, sales and investment, etc., should be in line with market supply and demand, without state intervention. The main composition of cost basically reflects market value. Enterprises should have a clear set of basic accounting records, independently audited, conform to international accounting standards, and apply to all aspects; the production cost and financial situation of enterprises are not seriously distorted in the process of pformation, especially in terms of asset depreciation, refunds, barter trade and compensation trade; enterprises should apply bankruptcy law and property law, so as to ensure that the business of enterprises has statutory clarity and stability; foreign exchange convertibility should be in line with market exchange rate.

Five, the EU's recent practices in terms of market economy status: 1, the time limit for making the list is advanced: from the past 21 days to 15 days; 2, in the MES table, it is required to fill in the product specifications; 3, in a case, the market economy status is directly examined through written examination without on-site verification; 4, the merger of market economic status verification and dumping verification.