Trade defence instruments represent one of the main instruments applied within the framework of the European Union’s common foreign trade policy.
The European Union applies trade defence instruments (TDI) that comply with the World Trade Organisation agreements to protect producers against unfair competition. The instruments are categorised as follows:
Customs duties or price undertaking against unfair competition. Aimed at repairing the damages caused as a consequence of unfair competition on behalf of an entrepreneur (export prices being lover than the domestic market sales price of the product concerned).
Customs duties or price undertaking against unfair competition. Aimed at repairing the damages offered by the state (subsidies) caused by prohibited concessions.
Customs duty, quota or their combination, tariff quota. Will be applied to trade that takes place in the conditions of fair competition, but only if the manufacturing of the European Union is in a serious crisis and requires short-term, limited protection.
Most of the complaints regarding dumping and prohibited concessions are filed by European Union producers in the following areas:
Iron and steel products
The largest number of trade defence instruments are aimed against China, India, Taiwan, Indonesia, Thailand, Russia, Ukraine and Belarus.
In 2013, in total, 94 anti-dumping or countervailing measures were imposed in the European Union. According to this number of measures, the European Union ranks fifth in the world, after the United States of America, India, Turkey and China.
Implementation of defence instruments and the role of Estonia
The European Union producers must submit, to apply the defence instruments, a compliant to the European Commission with possible evidence that proves an unfair competition or crisis.
The European Commission will then initiate investigation proceedings and will make, depending on the conclusions, a proposal to the member states for the implementation or non-implementation of measures.
Implementation of various measures and instruments, including any other foreign trade issues, is the competence area of the Directorate General for Trade of the European Commission and the member states only play an advisory role. The European Commission has established a Trade Defence Committee (TDC) and a defence measures committee/dispute resolution committee (SGC) to consult with the member states.
At the sessions of the Committees, the European Commission will notify the member states of the received complaints and investigation results and will consult with them regarding the scope and type of the measures to be applied. The decision to use a trade defence instrument will be made by the European Commission, yet the member states have the right to reject it with the regular qualified majority vote.
Estonia was, before it joined the European Union, one of the countries with the most liberal trade policies in the world and we did not implement any instruments to protect our market. Estonia analyses the proposals from the European Commission well to ensure a level of protectionism that is as low as possible and to avoid the unjustified adoption of defence instruments.