Global Fastener News

2009 FIN – European Distributors Seek ‘Level Playing Field’

April 04
00:00 2013

November 10, 2009 FIN – “Actual dumping we are against,” European Fastener Distributors Association president Geoff Hopwood declared. “We want a level playing field.”

But EFDA leaders questioned whether anti-dumping tariffs applied in February 2009 on fasteners imported from China reflected real trading prices.
Europe implemented an 85% tariff on Chinese exporters. Specific tariffs apply to some of the companies cooperated in the investigation. Those range from 0% for two subsidiaries of European companies, 26.5% for one Hong Kong registered company and between 63% and 77.5% for the remainder.
EFDA chair Bernd Stapf told FIN the European Commission didn’t find any proof that Chinese factories were exporting products at lower prices than they were supplying their domestic market during the European investigation process.
“The dumping / duty calculation was based on a single small company in India which was not representative, in consequence the unrealistic high AD-rate did even surprise the complainants,” Stapf pointed out. Indian prices usually reflect direct manufacturer to end user sales because there is not the same distribution infrastructure in India, he added.
The European Union does not recognize China as a market economy so it uses a comparative economy to calculate normal values to determine dumping. The EC process doesn’t release the calculations for tariffs for concerned groups to respond to. “We weren’t even asked for comment.”
Participation in the process is expensive as attorneys and specialists have to follow step by step and explain real figures, which is expensive for trade organizations, Stapf explained.
Hopwood suggested the real problem is in steel subsidies rather than fastener prices. Stapf noted that tariffs might have been based on 24% steel subsidies confirmed in a separate steel AD case – yet steel is not 100% of the cost of a fastener.
“We don’t want Europe to support dumping,” Stapf said. “We support fair trade.”
“At the end of the day it was a political decision,” Stapf reflected. There are 27 member companies and the smallest country – Malta – gets the same one vote as the largest industrial producer – Germany. The antidumping tariffs past with a bare one-vote majority of 14 votes. Abstentions even count as “yes,” Stapf added.
The consequences of the European tariffs are not known yet, Stapf suggested. During the 15-month price investigation European distributors built up stocks and then the market collapsed and inventories have not been depleted so results are not obvious yet.
Hopwood remarked to FIN that the effect of U.S. anti-dumping tariffs on China and Taiwan would result in more production moving to other Asian countries.
When worldwide demand returns, there is not enough capacity in the U.S. and Europe or in other Asian countries to replace Chinese and Taiwan production, Hopwood explained.
Stapf started in the fastener industry in 1981 and retired as head of the Borstlap International division in 2004 and subsequently has led EFDA.
Hopwood, who started in the fastener industry in 1996 as managing director of Rawlplug in the UK, is chairman of UK wholesaler/master distributor Owlett/Jaton.
According the European-based Fastener + Fixing magazine the Commission has 45 days from when a complaint is lodged to decide whether an investigation should be initiated. The complaint is not made public and the Commission does not acknowledge that it has been lodged.
The decision on an investigation is announced in the online EU Official Journal.  Interested parties have 10 days to register their interest by requesting a questionnaire.
Usually the Commission applies a sampling system and selects representative companies to investigate. From the date the investigation commences the EC has nine months to announce its preliminary decision, which may or may not include preliminary tariffs. The shortest period in which it can, theoretically, apply provisional tariffs is 60 days after the investigation starts.
It may, as in the carbon steel fastener case against China, decide not to apply preliminary tariffs but still move onto the definitive stage of the process.
A definitive decision must be made within 15 months of the start of the investigation and be approved by a majority of the EU member states. The regulations take effect the day after being published in the Official Journal. ©2009/2013 Fastener Industry News.
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