EU Committee Backs 'Dumping' Duties On Asian Shoes

by Ulrika Lomas, Tax-News.com, Brussels

20 March 2006

The EU's 'anti-dumping' committee voted to impose tariffs on some types of Chinese and Vietnamese shoes last week, beginning in April and rising to a maximum of 19% after several months. Trade Commissioner Peter Mandelson's proposals now go to the full Council on Wednesday for approval.

It was a strange vote, though: out of 25 member states, only three voted in favour. Some protectionist states abstained because the proposal is too limp; other liberal states abstained because the proposal is too fierce; two states didn't vote at all (??); and nine states voted against. But in the EU's upside-down world, abstentions count as votes in favour, so the proposal goes forward.

Italy, and other shoe-making countries opposing the plan, are against the exemptions made for sports and children’s shoes. The plan exempts all sports shoes priced above €9 ($10.87) and children's shoes up to size 37.5. In fact , the duties will affect just 9% o the shoes sold in Europe this year.

The Commission says that its investigators had found "compelling evidence" of Chinese and Vietnamese shoemakers selling into Europe at artificially low prices - what constitutes 'dumping' - but they always say that, and it is notoriously difficult to estimate costs in foreign countries. Needless to say, China says that there are serious flaws in the evidence presented by the EU, and that it will take the issue to the WTO.

According to the Chinese, 98 per cent of enterprises in China's shoe making sector are privately run firms or joint ventures and the State intervention claimed by the EU does not exist. Last month Peter Mandelson claimed that Chinese and Vietnamese footwear exporters conducted "State-supported dumping".

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