331 / 342
"Pressure on the Screwdrivers"
A recent development in the Anti-Dumping law of the European Communities.
The economic s t r eng th of Japan and its cur rent large t r ad i ng
surplus w i t h the rest of the Wo r ld has caused conce rn among
its p r i nc i pal t r ad i ng par t ners i.e., t he US and EEC. Japanese
I ndus t ry has been p r oduc i ng on a mass i ve scale and has
dumped mu ch of its surplus in the EEC. Dur i ng 1 9 84 the EEC
passed t ough an t i - dump i ng measures in order t o counter this
f l ood of Japanese me r chand i se. Howeve r, t he Japanese
ma n a g ed t o c i r c um v e nt t he a n t i - d ump i ng r u l es by
e s t ab l i s h i ng a s s emb ly on ly ope r a t i ons ( " s c r ewd r i v er
ope r a t i ons ") w i t h i n t he EEC. Du r i ng t he s ummer of 1 9 8 7,
t he EEC amended its t r ade p r o t ec t i on code in order t o b r i ng
these ope r a t i ons w i t h i n t he scope of t he an t i - dump i ng
f r amewo r k. The cases aga i nst t he Japanese Co r po r a t i ons
men t i oned in t h is ar t i c le are t he f i r st t o be t aken under t he
new l aw. The ar t i c le analyses t he t ext of t he " s c r ewd r i v e r"
l aw, t he new " A r t i c le 13 of Regu l a t i on 2 1 7 6 / 9 4 " , as
amended by Regu l a t i on 1761 / 87 .
1
The con t en ts of t he
Commi ss i on Not i ces concern i ng the proposed investigations
are also d i scussed.
September 1st 1987 saw the
opening of a new and vigorous
chapter
in
the
European
Community Trade Protection Pro-
gramme. On that day the law
agreed by member states last July
which allows the Community to
impose anti-dumping duties on
unfairly
under-priced
non-
Community products assembled
inside the EC was invoked for the
first time. The measure is designed
to prevent
non-Community
manufacturers from establishing
plants within the EC to assemble
products which are the subject of
definitive anti-dumping duties.
The action is being taken against
Japanese firms, Brother Industries
Limited, Canon Corporation,
Matsushita Electric Company
Limited, Tokyo Electric Company
Limited, Sharp Corporation and
Silver Seiko in relation to Electronic
Typewriters. Tokyo Electric
Company is also facing anti-
dumping duties
concerning
electronic scales originating in
Japan. The threatened imposition
of measures described in a
Financial Times article as "one of
the toughest anti-dumping laws in
the world" has caused grave
concern in Japan. The Keidanren
(Japanese Industry Confederation)
has warned that this extension of
anti-dumping rules could lead to a
reduction in Japanese investment
in the Community (currently
estimated to be two billion dollars
worth of plant employing 72,000).
The importance of the present
investigations is increased as they
could be just the first in a series of
such moves by the Commission's
External Relations Directorate.
Other possible targets are
Japanese backed operations
by
CATHAL T. O CONAILL
B.C.L., Solicitor
producing photocopiers, mechanical
excavators and electric motors.
It is envisaged by Commission
sources that definitive anti-
dumping duties will be imposed in
the present cases within the next
three months which is considerably
quicker than the time for
conventional anti-dumping duties.
Indeed lawyers acting for the
Japanese corporations involved
have been quoted as saying that
the Commission is trying to make
their defence unnecessarily
difficult by setting an unreasonably
short time (1 5 days) to respond to
the case.
Background — E.C. Trade
Protection Framework
Article 3 (b) of the Treaty of Rome
sets out as one of the objectives of
the E.C. "the establishment of a
common customs tariff and of a
common commercial policy
towards third countries." Ar
+i
cle
113 of the Treaty dealing with the
Common Commercial Policy
(C.C.P.) is the legal basis for E.C.
trade protection measures.
The Community has had
exclusive responsibility for the
implementation of the C.C.P. since
1st January 1970 (the end of the
transitional period). The Court of
Justice has ruled that this
consolidation of power in the
hands of the Community precludes
member states from implementing
or adopting measures different
from those which the Community
seeks to adopt in relation to third
countries.
2
The Community has adopted
four instruments of trade
protection: —
(1) Anti-dumping measures:
Regulation 2176/84
3
herein-
after called the Regulation),
Decision 2177/84
4
and Reg-
ulation 1761/87;
(2) Countervailing Measures:
Regulation 2176/84 and
ECSC Decision 2177/84;
(3) Safeguard measures: these
measures are authorised
under various regulations,
notably Regulation 288/82.
5
These regulations represent
the implementation of Article
XIX
of
GATT
which
authorises safeguard measures
where a product is being
imported into the territory of
that contracting party in such
increased quantities and
under such conditions as to
cause or threaten serious
injury to domestic producers
in that territory of like or
directly competitive products.
(4) The New Commercial Policy
Instrument. Since 1984 the
Community
has
been
empowered to take measures
321