* Trade chief says proposal would allow more
* Would ease companies fears in cases against China
* Proposal would be the biggest modernisation in almost 20
By Ethan Bilby
BRUSSELS, April 10 The European Union's trade
chief Karel De Gucht asked for broad new trade powers on
Wednesday to make it easier to launch anti-dumping cases,
particularly against China.
Although the proposed rules do not mention China by name, EU
officials said they were designed to give the EU more leverage
against the country and to ease companies' fears of retaliation
in cases involving the powerful Asian economy.
"It would be naive to say we've not been inspired in our
thinking by our experience of dealing with investigations which
are in China. The bulk of our cases, 80 percent or something,
concern imports from China," an EU official said.
De Gucht told Reuters the proposal to demand companies hand
over sensitive data to prove some foreign products are sold
below cost in Europe will allow regulators more freedom to start
a trade investigation on their own initiative, known as "ex
officio", without needing a complaint from affected industry.
"By compelling companies to answer our questionnaires it
would also help normalise ex officio - and that is not
unintentional," he said.
Fear of Chinese officials hitting back at European
industries that assist with investigations featured in an
anti-dumping probe on Chinese solar panels.
Concerns of possible retaliation have also prevented the
launch of a case against telecom equipment makers Huawei
and ZTE, sources familiar with the case
Asked whether the proposed new rule to compel companies to
provide data supporting trade cases would give them enough cover
to cooperate in a telecoms case, De Gucht told Reuters: "The
fact that you would make it a normal procedure would certainly
go further than is currently the case."
TRADE LAWYERS SCEPTICAL
The proposal, which must be approved by EU governments and
the European Parliament before becoming law, would strengthen
the Commission's ability to scrutinise trade issues without
needing businesses to come forward.
It would also bring trade defence powers closer to the
Commission's robust antitrust unit, one of the most powerful
enforcers globally, due in large part to its ability to force
companies under investigation to hand over data within a fixed
But Brussels trade lawyers were sceptical of the proposal's
abilities to shield companies from revenge.
"Everybody is going to guess that even before the initiation
(of a case), the local industry to some extent participated and
cooperated...so what retaliation are you preventing? If you have
a telecoms case with only three operators, then it's easy to
retaliate against everybody," a Brussels trade lawyer said.
The proposal would also remove a limit on the size of duties
that could be placed on countries found to distort access to
their raw materials like rare earth minerals, which could result
in significantly higher duties for countries like China.
China has come under fire for restricting access to its rare
earth minerals, which are crucial for the defence, electronics
and renewable-energy industries, and are also used in smart
phones, disk drives and wind turbines.
Last year, the United States, the European Union, and Japan
launched a WTO complaint against China on this issue.