EU suggests 16.5% duty on Chinese shoes1 September 2006
The latest development in the on-going dispute over anti-dumping duties is the EU's recommendation that duties be set at 16.5% for Chinese shoes and 10% for Vietnamese shoes. The move, presented by Trade Commissioner Peter Mandelson, is aimed at finally resolving the issue as to how much duty should be placed on imports of leather footwear from China and Vietnam. EU governments have one month to accept or reject the suggestion. The duties would then take effect on October 7 and last five years. They would replace the temporary levies of 19.4% and 16.8% for China and Vietnam respectively that were introduced in March and will expire on October 6. The dispute has been prolonged by varying opinions as to whether duties should actually be instigated following the EU's 15-month investigation that concluded that dumping had taken place. The report concluded: 'There is clear evidence of serious state intervention in the leather footwear sector in China and Vietnam - cheap finance, tax holidays, non-market land rents and improper asset valuation'. The European Commission is said to be 'exasperated' at the differences in opinion of the EU member states. In a statement it said it has 'fulfilled its obligations and responsibilities and has brought forward a sound proposal', adding 'it is now for member states to debate their position among themselves'. It is unclear whether the EU will vote in favour of the new duties. If the proposal is rejected, Chinese and Vietnamese shoes will be able to enter Europe from early October free of anti-dumping duties. If that happens, the European footwear confederation is likely to start legal proceedings in the European Court of Justice against the EU for failing to respect its legal anti-dumping responsibilities. Over the past five years, European footwear production has decreased by around 30% with the loss of around 40,000 jobs.