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Policy analysis

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Policy analysis

 

Article 1

Principles

1.   A countervailing duty may be imposed to offset any subsidy granted, directly or indirectly, for the manufacture, production, export or transport of any product whose release for free circulation in the Union causes injury.

2.   Notwithstanding paragraph 1, where products are not directly imported from the country of origin but are exported to the Union from an intermediate country, the provisions of this Regulation shall be fully applicable and the transaction or transactions shall, where appropriate, be regarded as having taken place between the country of origin and the Union.

Article 2

Definitions

For the purposes of this Regulation:

(a)

a product is considered to be subsidised if it benefits from a countervailable subsidy as defined in Articles 3 and 4. Such subsidy may be granted by the government of the country of origin of the imported product, or by the government of an intermediate country from which the product is exported to the Union, known for the purposes of this Regulation as ‘the country of export’;

(b)

‘government’ means a government or any public body within the territory of the country of origin or export;

(c)

‘like product’ means a product which is identical, that is to say, alike in all respects, to the product under consideration, or, in the absence of such a product, another product which, although not alike in all respects, has characteristics closely resembling those of the product under consideration;

(d)

‘injury’, unless otherwise specified, means material injury to the Union industry, threat of material injury to the Union industry or material retardation of the establishment of such an industry, and shall be interpreted in accordance with the provisions of Article 8.

         

Article 3

Definition of a subsidy

A subsidy shall be deemed to exist if:

1.

(a)

there is a financial contribution by a government in the country of origin or export, that is to say, where:

(i)

a government practice involves a direct transfer of funds (for example, grants, loans, equity infusion), potential direct transfers of funds or liabilities (for example, loan guarantees);

(ii)

government revenue that is otherwise due is forgone or not collected (for example, fiscal incentives such as tax credits). In this regard, the exemption of an exported product from duties or taxes borne by the like product when destined for domestic consumption, or the remission of such duties or taxes in amounts not in excess of those which have been accrued, shall not be deemed to be a subsidy, provided that such an exemption is granted in accordance with the provisions of Annexes I, II and III;

(iii)

a government provides goods or services other than general infrastructure, or purchases goods;

(iv)

a government:

makes payments to a funding mechanism, or

entrusts or directs a private body to carry out one or more of the type of functions illustrated in points (i), (ii) and (iii) which would normally be vested in the government, and the practice, in no real sense, differs from practices normally followed by governments;

     

 

         

or

(b)

there is any form of income or price support within the meaning of Article XVI of the GATT 1994; and

     

 

 

2.

a benefit is thereby conferred.

 

     

 

Article 8

Determination of injury

1.   A determination of injury shall be based on positive evidence and shall involve an objective examination of:

(a)

the volume of the subsidised imports and the effect of the subsidised imports on prices in the Union market for like products; and

(b)

the consequent impact of those imports on the Union industry.

 

Article 10

Initiation of proceedings

1.   Except as provided for in paragraph 8, an investigation to determine the existence, degree and effect of any alleged subsidy shall be initiated upon a written complaint by any natural or legal person, or any association not having legal personality, acting on behalf of the Union industry.

The complaint may be submitted to the Commission or to a Member State, which shall forward it to the Commission. The Commission shall send Member States a copy of any complaint it receives. The complaint shall be deemed to have been lodged on the first working day following its delivery to the Commission by registered mail or the issuing of an acknowledgement of receipt by the Commission.

Where, in the absence of any complaint, a Member State is in possession of sufficient evidence of subsidisation and of resultant injury to the Union industry, it shall immediately communicate such evidence to the Commission.

 

 

Article 11

The investigation

1.   Following the initiation of proceedings, the Commission, acting in cooperation with the Member States, shall commence an investigation at Union level. Such an investigation shall cover both subsidisation and injury, and they shall be investigated simultaneously.

For the purpose of a representative finding, an investigation period shall be selected which in the case of subsidisation shall, normally, cover the investigation period provided for in Article 5.

Information relating to a period subsequent to the investigation period shall not, normally, be taken into account.

 

Article 13

Undertakings

1.   On the condition that a provisional affirmative determination of subsidisation and injury has been made, the Commission may in accordance with the advisory procedure referred to in Article 25(2) accept satisfactory voluntary undertakings offers under which:

(a)

the country of origin and/or export agrees to eliminate or limit the subsidy or take other measures concerning its effects; or

(b)

any exporter undertakes to revise its prices or to cease exports to the area in question as long as such exports benefit from countervailable subsidies, so that the Commission is satisfied that the injurious effect of the subsidies is thereby eliminated.

 

 

Article 28

Non-cooperation

1.   In cases in which any interested party refuses access to, or otherwise does not provide necessary information within the time limits provided for in this Regulation, or significantly impedes the investigation, provisional or final findings, affirmative or negative, may be made on the basis of the facts available.

Where it is found that any interested party has supplied false or misleading information, that information shall be disregarded and use may be made of the facts available.

Interested parties shall be made aware of the consequences of non-cooperation.

 

 

 

Article 31

Union interest

1.   A determination as to whether the Union`s interest calls for intervention shall be based on an appraisal of all the various interests taken as a whole, including the interests of the domestic industry and users and consumers. A determination pursuant to this Article shall be made only where all parties have been given the opportunity to make their views known pursuant to paragraph 2. In such an examination, the need to eliminate the trade-distorting effects of injurious subsidisation and to restore effective competition shall be given special consideration. Measures, as determined on the basis of subsidisation and injury found, may not be applied where the authorities, on the basis of all the information submitted, can clearly conclude that it is not in the Union`s interest to apply such measures.

2.   In order to provide a sound basis on which the authorities can take account of all views and information in the decision as to whether or not the imposition of measures is in the Union`s interest, the complainants, importers and their representative associations, representative users and representative consumer organisations may, within the time limits specified in the notice of initiation of the countervailing duty investigation, make themselves known and provide information to the Commission. Such information, or appropriate summaries thereof, shall be made available to the other parties specified in this paragraph, and they shall be entitled to respond to such information.


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