As part of its anti-dumping review the Commission checks, whether companies import their products at a lower price into the EU than their standard price on their domestic market, i.e. below the domestic price or manufacturing costs. Measures introduced are frequently minimum import prices which generally apply for five years unless an expiry review is initiated.
The EU defines subsidies as a “financial contribution (on behalf of) a government or public institution in favour of the recipient”. If such subsidies are limited to a specific industrial sector or companies, the EU can impose counteracting tariffs (countervailing duties). Countermeasures, generally punitive tariffs, apply for five years if no review is carried out.
A circumvention of measures is given, when companies apply methods designed to avoid paying applicable tariffs. Tariffs are applied to a specific product from a specific country of origin. A circumvention applies, when the product is modified or it is stated (incorrectly) that a product is made in a different country than that from which it originates. An investigation by the commission into the relevant facts is referred to as anti-circumvention investigation. Such an investigation must be concluded within nine months; in the current case no later than by February 2016.
Such reviews are commonly applied for by EU manufacturers prior to the expiry of anti-subsidy or anti-dumping measures. The application must provide proof that the expiry of such measures would result in further damage to the European market. Any review initiated must be concluded within 15 months.
Contrary to the expiry view, a partial interim review can be applied for by interested parties (exporters, importers, EU manufacturers of the product concerned) at any time, but no sooner then 12 months after the measures come into force. The Commission or an EU country can make such an application at any time. An interim review can be quite extensive and cover all aspects of the original review (full) or just a part of it (partial). The review may take up to 15 months; in the current case this review has to be concluded by August 2016.
Minimum import price
The minimum import price is an anti-dumping measure and a special form of punitive tariff. It represents a company-specific duty designed to reach a minimum price. In this case, EU importers do not pay duties, but a minimum price instead.
Undertaking is a declaration of obligations. In this case some Chinese module manufacturers have declared their willingness to sell solar modules and components in Europe at a minimum price.
Duties or tariffs are a measure by the EU against dumping and illegal subsidies. These may be imposed as a fixed quotient (e.g. €100 per tonne) or ad valorem duty (a percentage of the net import price).