Collective’s Response to Registration: Registration Regulation Causes Irreparable Damage to Eu Importers

2224 days ago

6 minutes

The Collective of European Importers of Electric Bikes expressed a burning protest against the Commission’s decision to register imports. The group denounces the fact that the Registration Regulation causes severe injury to the European importers and seriously jeopardizes the future of the affected companies. While there is still no conclusive evidence for the accusation that imports are injuring the EU industry, the Regulation threatens importers with the possible retroactive collection of sky-high dumping duties. This threat hangs like a sword of Damocles over the head of a very large number of European SMEs.

Today, the Collective has submitted its official response on the Registration Regulation to the European Commission. In the document, the Collective fiercely criticizes the Commission’s arguments. A first essential point of criticism is that the Commission has based the registration decision entirely on the complaints of the EBMA and on Chinese statistics, obtained in a way that is, to say the least, very doubtful.

No injury to EU producers

The Collective argues that the investigation has been going on for six months, enough time for the Commission to test the EBMA complaints against reality and come to provisional findings, for example on the injury to the European industry. As for this, it is a fact that the Commission does have useful information as a result of the verification visits carried out at Accell, Derby Cycle, Eurosport, Gazelle and Prophete. After these investigations, the non-confidential findings were made public. These clearly show that, for all companies, profitability for the product concerned improved significantly in 2015, 2016 and during the investigation period. (See the table below)

23. Profitability of the Product in Question 2014 2015 2016 IP
Accell Group EUR 100 191 182 67
Derby Cycle Holding GmbH EUR 100 163 228 197
Eurosport DHS SA EUR 100 344 867 1,895
Koninklijke Gazelle NV EUR 100 431 236 332
Prophete GmbH & Co. KG EUR 100 68 81 118

Source: Sampled EU Producers Questionnaire Replies

These findings go totally against EBMA’s allegations about the injury to European industry as a result of Chinese imports. In defence, the Collective asks the Commission, and this for the third time, to confirm the accuracy of the damage indicators that have been established by verifying the sampled producers. The Collective adds that this information shows no injury for EU producers whatsoever, but crucially improving trends in terms of turnover, sales volumes and profitability.

Appalling messages

A second essential point of criticism is that the European Commission systematically ignores all argumentation of the Collective. That is in conflict of the article in the dumping legislation that explicitly requires the Commission, as far as registration is concerned, to give importers the opportunity to comment. The Collective states that the right to comment is purposeless, if the Commission can simply completely ignore the Collective in the way that it has done, without explaining why their argumentations and the evidence provided has not been sufficient persuasive to the Commission.

The Collective is utterly dismayed by the message that the Commission has sent out with this registration. The Collective is particularly appalled by the dumping rates mentioned in the Regulation because they strike fear into the hearts of EU importers faced with potentially gigantic duties. And the Collective warns the Commission that most importers will be forced to close their business if such high duties would be collected retroactively.

The Collective further notes: “As for the indicative dumping duty rates of 189%, the Commission is fully aware that in no previous anti-dumping investigation has dumping duties even close to this rate ever been imposed by the EU on any imports from any non-EU country. Yet this is the figure that importers have to work with when managing the risks of carrying on their business. Factoring in such an enormous cost renders continued business unfeasible if almost double of the import value of the bicycles will have to be paid in early 2019. It is therefore highly regrettable that the Commission made such a statement of an excessively high potential duty rate being retroactively imposed.

Dubious data source

A third, important point of criticism is the fact that the European Commission continues to rely on the use of Chinese export data and to confidentiality for the source of that data. In the Regulation, the Commission mentions two reasons for keeping the data confidential. First, disclosure would breach copyright and, second, the source is known and public against payment.

In the complaint itself, EBMA did not ask for confidentiality for the source. That was only claimed afterwards for reasons, which, to date remain undecipherable. In the meantime, the Collective has researched the availability of the data and found that the necessary data to a 10 digit level (as used by EBMA) cannot be provided because they are not publicly released by the Chinese authorities.  This is consistent with the official statement from the Chinese customs authorities (available online on government’s websites: see point 0.1.3 in http://www.customs.gov.cn/publish/portal0/tab70498/info772783.htm) that export data is available only up to 8 digit level. All this goes against the Collective’s right of defence because the Commission is determining import volumes based on data, which the Collective is unable to verify.

Irreparable damage

The Collective concludes: “The Collective and its members are concerned by the lack of objectivity demonstrated by the Commission in the Registration Regulation and worst still, the consequences of its apparent endorsement of the extreme claims made in its two complaints.

The damage caused by the statements made in the Registration Regulation to EU importers is irreparable. They will never be able to recoup the lost sales volumes and revenues in the 2018 season caused by the excessive, disproportionate and unwarranted element of risk that has to be managed as a consequence of the signals sent out to the market in the Registration Regulation.

Finally, the Collective has requested for another hearing to further explain their concerns regarding both registration and the lack of injury and causation. A the same time, the Collective is contacting the Hearing Officer to also arrange a hearing with this service should the Commission continue to decline the Collective’s requests for the additional information and clarifications set out in the submission.

For further details, please contact Annick Roetynck, LEVA-EU Manager, leva-eu@telenet.be, tel. +32 9 233 60 05.

Annick Roetynck

Annick is the Manager of LEVA-EU, with decades of experience in two-wheeled and light electric mobility.

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