Reform history

1. For the purposes of this Regulation, the term ‘Union industry’ shall be interpreted as referring to the Union producers as a whole of the like products or to those of them whose collective output of the products constitutes a major proportion of the total Union production of those products, except that:

Complaints may also be submitted jointly by the Union industry, or by any natural or legal person or any association not having legal personality acting on behalf thereof, and trade unions, or be supported by trade unions. This does not affect the possibility for the Union industry to withdraw the complaint.

1a.  The Commission shall facilitate access to the trade defence instrument for diverse and fragmented industry sectors, largely composed of small and medium-sized enterprises (SME) through a dedicated SME Helpdesk, for example by awareness raising, by providing general information and explanations on procedures and on how to submit a complaint, by releasing standard questionnaires in all official languages of the Union and by replying to general, non-case-specific queries.

The SME Helpdesk shall make available standard forms for statistics to be submitted for standing purposes and questionnaires.

7. The Union producers, the government of the country of origin and/or export, trade unions, importers and exporters and their representative associations, users and consumer organisations, which have made themselves known in accordance with the second subparagraph of Article 10(12), may, upon written request, inspect all information made available to the Commission by any party to an investigation, as distinct from internal documents prepared by the authorities of the Union or its Member States, which is relevant to the presentation of their cases and is not confidential within the meaning of Article 29, and is used in the investigation.

9. For proceedings initiated pursuant to Article 10(11), an investigation shall, whenever possible, be concluded within one year. In any event, such investigations shall in all cases be concluded within 13 months of their initiation, in accordance with the findings made pursuant to Article 13 for undertakings or the findings made pursuant to Article 15 for definitive action. Investigation periods shall, whenever possible, especially in the case of diverse and fragmented sectors largely composed of SMEs, coincide with the financial year.

11. Union producers of the like product are requested to cooperate with the Commission in investigations that have been initiated pursuant to Article 10(8).

12. The Commission shall have in place the office of the Hearing Officer whose powers and responsibilities are set out in a mandate adopted by the Commission and who shall safeguard the effective exercise of the procedural rights of the interested parties.

(a)proceedings have been initiated in accordance with Article 10;

(b)a notice has been given to that effect and interested parties have been given an adequate opportunity to submit information and make comments in accordance with the second subparagraph of Article 10(12);

(c)a provisional affirmative determination has been made that the imported product benefits from countervailable subsidies and consequent injury to the Union industry; and

The provisional duties shall be imposed no earlier than 60 days from the initiation of the proceedings but no later than nine months from the initiation of the proceedings.

The amount of the provisional countervailing duty shall correspond to the total amount of countervailable subsidies as provisionally established.

Where the Commission, on the basis of all the information submitted, can clearly conclude provisionally that it is not in the Union’s interest to impose the provisional duty at that amount, the provisional countervailing duty shall be the amount adequate to remove the injury to the Union industry, if this is lower than the total amount of countervailable subsidies.

Provisional duties shall not be imposed within a period of three weeks after the information is sent to interested parties under Article 29a (period of pre-disclosure). The provision of such information shall not prejudice any subsequent related decision that may be taken by the Commission.

The Commission shall review by 9 June 2020, whether a substantial rise in imports has occurred during the period of pre-disclosure and whether, if such rise has occurred, it has caused additional injury to the Union industry, despite the measures that the Commission might have taken based on Article 24(5a) and Article 15(1). It shall rely in particular on data collected on the basis of Article 24(6) and any relevant information at its disposal. The Commission shall adopt a delegated act in accordance with Article 32b to amend the duration of the period of pre-disclosure to two weeks in the case of a substantial rise of imports that have caused additional injury and to four weeks where this is not the case.

The Commission shall make public on its website its intention to impose provisional duties, including information on the possible duty rates, at the same time when it provides interested parties with the information pursuant to Article 29a.

1a.  When the injury margin is calculated on the basis of a target price, the target profit used shall be established taking into account factors such as the level of profitability before the increase of imports from the country under investigation, the level of profitability needed to cover full costs and investments, research and development (R&D) and innovation, and the level of profitability to be expected under normal conditions of competition. Such profit margin shall not be lower than 6 %.

1b.  When establishing the target price, the actual cost of production of the Union industry, which results from multilateral environmental agreements, and protocols thereunder, to which the Union is a party, or from International Labour Organisation (ILO) Conventions listed in Annex Ia to this Regulation, shall be duly reflected. Moreover, future costs, which are not covered in paragraph 1a of this Article, which result from those agreements and conventions, and which the Union industry will incur during the period of the application of the measure pursuant to Article 18(1), shall be taken into account.

1. Where 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:

(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, if the injurious effect of the subsidies is thereby eliminated.

In such a case and as long as such undertakings are in force, provisional duties imposed by the Commission in accordance with Article 12(3), or definitive duties imposed in accordance with Article 15(1), as the case may be, shall not apply to the relevant imports of the product concerned manufactured by the companies referred to in the Commission decision accepting undertakings, as subsequently amended.

Price increases under such undertakings shall not be higher than necessary to offset the amount of countervailable subsidies.

Where the Commission, on the basis of all the information submitted, can clearly conclude provisionally that it is not in the Union’s interest to determine the price increase under such undertakings, in accordance with the third subparagraph of paragraph 1 of this Article, the increase under such undertakings shall be less than the amount of countervailable subsidies if such increase would be adequate to remove the injury to the Union industry.

Save in exceptional circumstances, undertakings may not be offered later than five days prior to the end of the period during which representations may be made pursuant to Article 30(5), so as to ensure the opportunity to comment for other parties.

3. Undertakings offered need not be accepted if their acceptance is considered impractical, such as where the number of actual or potential exporters is too great, or for other reasons, including reasons of general policy which comprise in particular the principles and obligations set out in multilateral environmental agreements and protocols thereunder, to which the Union is a party, and of ILO Conventions listed in Annex Ia to this Regulation. The exporter and/or the country of origin and/or export concerned may be provided with the reasons for which it is proposed to reject the offer of an undertaking and may be given an opportunity to make comments thereon. The reasons for rejection shall be set out in the definitive decision.

4. Parties which offer an undertaking shall be required to provide a non-confidential version of such undertaking that is meaningful in the sense of Article 29, so that it may be made available to interested parties to the investigation, to the European Parliament and to the Council.

Furthermore, before accepting any such offer, the Union industry shall be given an opportunity to comment with regard to the main features of the undertaking.

5. The amount of the countervailable subsidies shall be considered to be *de minimis* if such amount is less than 1 % *ad valorem*. However, as regards investigations concerning imports from developing countries, the *de minimis* threshold shall be 2 % *ad valorem*.

The amount of the countervailing duty shall not exceed the amount of countervailable subsidies established.

Where the Commission, on the basis of all the information submitted, can clearly conclude that it is not in the Union’s interest to determine the amount of measures in accordance with the third subparagraph, the amount of the countervailing duty shall be less if such lesser duty would be adequate to remove the injury to the Union industry.

Where the Commission has not registered imports, but where the Commission finds, based on an analysis of all relevant information at its disposal when adopting definitive measures, that a further substantial rise in imports subject to the investigation occurs during the period of pre-disclosure, the Commission shall reflect the additional injury resulting from such increase in the determination of the injury margin for a period no longer than that referred to in Article 18(1).

If, following an investigation pursuant to this Article, the measure expires, any duties collected from the date of the initiation of such investigation on goods that were customs-cleared shall be repaid provided that this is requested from national customs authorities and granted by those authorities in accordance with the applicable Union customs legislation concerning repayment and remission of duty. Such repayment shall not give rise to the payment of interest by the national customs authorities concerned.

4. Investigations shall be initiated pursuant to this Article on the initiative of the Commission or at the request of a Member State or any interested party on the basis of sufficient evidence regarding the factors set out in paragraphs 1, 2 and 3 of this Article. Initiations shall be made by means of a Commission regulation which shall also instruct customs authorities to subject imports to registration in accordance with Article 24(5) or to request guarantees. The Commission shall provide information to the Member States once an interested party or a Member State has submitted a request justifying the initiation of an investigation and the Commission has completed its analysis thereof, or where the Commission has itself determined that there is a need to initiate an investigation.

Where the circumventing practice, process or work takes place outside the Union, exemptions may be granted to producers of the product concerned that are found not to be engaged in circumvention practices as defined in paragraph 3.

Where the circumventing practice, process or work takes place inside the Union, exemptions may be granted to importers that can show that they are not engaged in circumvention practices as defined in paragraph 3.

3. Special provisions, in particular with regard to the common definition of the concept of origin, as contained in Regulation (EU) No 952/2013 of the European Parliament and of the Council (¹), and with regard to the application and collection of a countervailing duty in the continental shelf of a Member State or the exclusive economic zone declared by a Member State pursuant to the United Nations Convention on the Law of the Sea (UNCLOS), may be adopted pursuant to this Regulation.

5. As of the initiation of the investigation and having informed Member States in due time, the Commission may direct the customs authorities to take the appropriate steps to register imports, so that measures may subsequently be applied against those imports from the date of such registration. Imports shall be made subject to registration following a request, from the Union industry, which contains sufficient evidence to justify such action. Imports may also be made subject to registration on the Commission’s own initiative. Registration shall be introduced by Commission regulation. Such regulation shall specify the purpose of the action and, if appropriate, the estimated amount of possible future liability. Imports shall not be made subject to registration for a period longer than nine months.

5a.  The Commission shall, unless it has sufficient evidence within the meaning of Article 10 that the requirements either under point (c) or (d) of Article 16(4) are not met, register imports pursuant to paragraph 5 of this Article during the period of pre-disclosure pursuant to Article 29a. When deciding on registration, the Commission shall in particular analyse the information collected based on the creation of Integrated Tariff of the European Union (TARIC) codes for the product under investigation pursuant to paragraph 6 of this Article.

6. Member States shall report to the Commission every month on the import trade in products subject to investigation and to measures, and on the amount of duties collected pursuant to this Regulation. When initiating an investigation pursuant to Article 10, the Commission shall create TARIC codes corresponding to the product under investigation. Member States shall use those TARIC codes in order to report on imports of the product under investigation as of the initiation of the investigation. The Commission may, upon receiving a specific reasoned request from an interested party, decide to provide them with a non-confidential summary of the information on aggregated import volumes and values of the products concerned.

8. Whenever the Commission intends to adopt any document providing general guidance to possible interested parties on the application of this Regulation, a public consultation in line with Article 11(3) TEU shall be carried out. The European Parliament and the Council may also express their views.

#### Article 24a

##### Continental shelf of a Member State or exclusive economic zone

1. A countervailing duty may also be imposed on any subsidised product brought in significant quantities to an artificial island, a fixed or floating installation or any other structure in the continental shelf of a Member State or the exclusive economic zone declared by a Member State pursuant to UNCLOS, where this would cause injury to the Union industry. The Commission shall adopt implementing acts laying down the conditions for the incurrence of such duties, as well as the procedures relating to the notification and declaration of such products and the payment of such duties, including recovery, repayment and remission (customs tool). Those implementing acts shall be adopted in accordance with the examination procedure referred to in Article 25(3).

2. The Commission shall only impose duties as referred to in paragraph 1 as of the date the customs tool referred to in paragraph 1 is operational. The Commission shall inform all economic operators that the customs tool is operational by separate publication in the *Official Journal of the European Union*.

1. In cases where the number of Union producers, exporters or importers, types of product or transactions is large, the investigation may be limited to a reasonable number of parties, products or transactions by using samples which are statistically valid, on the basis of information available at the time of the selection, or to the largest representative volume of production, sales or exports which can reasonably be investigated within the time available.

2. The final selection of parties, types of products or transactions made under those sampling provisions shall rest with the Commission. However, in order to enable the selection of a representative sample preference shall be given to choosing a sample in consultation with, and with the consent of, the parties concerned, provided that such parties make themselves known and make sufficient information available, within one week of initiation of the investigation.

#### Article 29a

##### Information at provisional stage

1. Union producers, importers and exporters and their representative associations, and the country of origin and/or export, may request information on the planned imposition of provisional duties. Requests for such information shall be made in writing within the time limit prescribed in the notice of initiation. Such information shall be provided to those parties three weeks before the imposition of provisional duties. Such information shall include: a summary of the proposed duties for information purposes only, and details of the calculation of the amount of the countervailable subsidy and the margin adequate to remove the injury to the Union industry, due account being taken of the need to respect the confidentiality obligations contained in Article 29. Parties shall have a period of three working days from the supply of such information to provide comments on the accuracy of the calculations.

2. In cases where it is intended not to impose provisional duties but to continue the investigation, interested parties shall be informed of the non-imposition of duties three weeks before the expiry of the deadline mentioned in Article 12(1) for the imposition of provisional duties.

2. In order to provide a sound basis on which the Commission 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 Union producers, trade unions, 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 proceedings, 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 Article, and they shall be entitled to respond to such information.

4. The parties which have acted in accordance with paragraph 2 may provide comments on the application of any provisional duties. Such comments shall be received within 15 days of the date of application of such measures if they are to be taken into account and they, or appropriate summaries thereof, shall be made available to other parties who shall be entitled to respond to such comments.

#### Article 32a

##### Report

1. The Commission shall, with due regard to the protection of confidential information within the meaning of Article 29, present an annual report on the application and implementation of this Regulation to the European Parliament and to the Council.

That report shall include information about the application of provisional and definitive measures, the termination of investigations without measures, undertakings, reinvestigations, reviews, significant distortions and verification visits, and the activities of the various bodies responsible for monitoring the implementation of this Regulation and fulfilment of the obligations arising therefrom. The report shall also cover the use of trade defence instruments by third countries targeting the Union and appeals against the measures imposed. It shall include the activities of the Hearing Officer of the Commission’s Directorate General for Trade and those of the SME Helpdesk in relation to the application of this Regulation.

The Report shall also include how social and environmental standards have been considered and taken into account in the investigations. Such standards shall cover those embodied in multilateral environmental agreements to which the Union is party and in ILO Conventions listed in Annex Ia to this Regulation, as well as equivalent national legislation of the exporting country.

2. By 9 June 2023 and every five years thereafter, the Commission shall submit, to the European Parliament and to the Council, a review of the application of the third and fourth subparagraphs of Article 12(1), the third and fourth subparagraphs of Article 13(1), and of the third and fourth subparagraphs of Article 15(1), including an evaluation of this application. Such a review may, where appropriate, be accompanied by a legislative proposal.

#### Article 32b

##### Exercise of the delegation

1. The power to adopt delegated acts is conferred on the Commission subject to the conditions laid down in this Article.

2. The power to adopt delegated acts referred to in Article 12(1) shall be conferred on the Commission for period of two years from 8 June 2018 and it can be exercised only once.

3. The delegation of power referred to in Article 12(1) may be revoked at any time by the European Parliament or by the Council. A decision to revoke shall put an end to the delegation of the power specified in that decision. It shall take effect the day following the publication of the decision in the *Official Journal of the European Union* or at a later date specified therein. It shall not affect the validity of any delegated acts already in force.

4. Before adopting a delegated act, the Commission shall consult experts designated by each Member State in accordance with the principles laid down in the Interinstitutional Agreement of 13 April 2016 on Better Law-Making (³).

5. As soon as it adopts a delegated act, the Commission shall notify it simultaneously to the European Parliament and to the Council.

6. A delegated act adopted pursuant to Article 12(1) shall enter into force only if no objection has been expressed either by the European Parliament or by the Council within a period of two months of notification of that act to the European Parliament and to the Council or if, before the expiry of that period, the European Parliament and the Council have both informed the Commission that they will not object. That period shall be extended by two months at the initiative of the European Parliament or of the Council.

(b)the Union Regulations in the agricultural sector and Council Regulations (EC) No 1667/2006 (⁴), (EC) No 614/2009 (⁵) and (EC) No 1216/2009 (⁶). This Regulation shall operate by way of complement to those Regulations and in derogation from any provisions thereof which preclude the application of countervailing duties;

(d)The provision by governments or their agencies either directly or indirectly through government-mandated schemes, of imported or domestic products or services for use in the production of exported goods, on terms or conditions more favourable than for provision of like or directly competitive products or services for use in the production of goods for domestic consumption, if (in the case of products) such terms or conditions are more favourable than those commercially available (⁷) on world markets to their exporters.

(e)The full or partial exemption, remission, or deferral (⁸) specifically related to exports, of direct taxes (⁹) or social welfare charges paid or payable by industrial or commercial enterprises.

(g)The exemption or remission, in respect of the production and distribution of exported products, of indirect taxes (¹⁰) in excess of those levied in respect of the production and distribution of like products when sold for domestic consumption.

(h)The exemption, remission or deferral of prior-stage cumulative indirect taxes (10)  on goods or services used in the production of exported products in excess of the exemption, remission or deferral of like prior-stage cumulative indirect taxes on goods or services used in the production of like products when sold for domestic consumption; provided, however, that prior-stage cumulative indirect taxes may be exempted, remitted or deferred on exported products even when not exempted, remitted or deferred on like products when sold for domestic consumption, if the prior-stage cumulative indirect taxes are levied on inputs that are consumed in the production of the exported product (making normal allowance for waste) (¹¹). This item shall be interpreted in accordance with the guidelines on consumption of inputs in the production process contained in Annex II.

(i)The remission or drawback of import charges (10)  in excess of those levied on imported inputs that are consumed in the production of the exported product (making normal allowance for waste); provided, however, that in particular cases a firm may use a quantity of home market inputs equal to, and having the same quality and characteristics as, the imported inputs as a substitute for them in order to benefit from this provision if the import and the corresponding export operations both occur within a reasonable time period, not to exceed two years. This item shall be interpreted in accordance with the guidelines on consumption of inputs in the production process contained in Annex II and the guidelines in the determination of substitution drawback systems as export subsidies contained in Annex III.

## ANNEX Ia

### **ILO CONVENTIONS REFERRED TO IN THIS REGULATION**

1.Convention concerning Forced or Compulsory Labour, No 29 (1930)

2.Convention concerning Freedom of Association and Protection of the Right to Organise, No 87 (1948)

3.Convention concerning the Application of the Principles of the Right to Organise and to Bargain Collectively, No 98 (1949)

4.Convention concerning Equal Remuneration of Men and Women Workers for Work of Equal Value, No 100 (1951)

5.Convention concerning the Abolition of Forced Labour, No 105 (1957)

6.Convention concerning Discrimination in Respect of Employment and Occupation, No 111 (1958)

7.Convention concerning Minimum Age for Admission to Employment, No 138 (1973)

8.Convention concerning the Prohibition and Immediate Action for the Elimination of the Worst Forms of Child Labour, No 182 (1999)

### **GUIDELINES ON CONSUMPTION OF INPUTS IN THE PRODUCTION PROCESS** (¹²)

3. **Public stockholding for food security purposes (¹³)**

4. **Domestic food aid (¹⁴)**

(¹) Regulation (EU) No 952/2013 of the European Parliament and of the Council of 9 October 2013 laying down the Union Customs Code (OJ L 269, 10.10.2013, p. 1).

(³) OJ L 123, 12.5.2016, p. 1.

(⁴) Council Regulation (EC) No 1667/2006 of 7 November 2006 on glucose and lactose (OJ L 312, 11.11.2006, p. 1).

(⁵) Council Regulation (EC) No 614/2009 of 7 July 2009 on the common system of trade for ovalbumin and lactalbumin (OJ L 181, 14.7.2009, p. 8).

(⁶) Council Regulation (EC) No 1216/2009 of 30 November 2009 laying down the trade arrangements applicable to certain goods resulting from the processing of agricultural products (OJ L 328, 15.12.2009, p. 10).

(⁷) ‘Commercially available’ means that the choice between domestic and imported products is unrestricted and depends only on commercial considerations.

(⁸) Deferral may not amount to an export subsidy where, for example, appropriate interest charges are collected.

(⁹) For the purposes of this Regulation:

(¹⁰) See footnote 2 to point (e).

(¹¹) Point (h) does not apply to value added tax systems and border-tax adjustment in lieu thereof; the problem of the excessive remission of value added taxes is exclusively covered by point (g).

(¹²) Inputs consumed in the production process are inputs physically incorporated, energy, fuels and oil used in the production process and catalysts which are consumed in the course of their use to obtain the exported product.

(¹³) For the purpose of point 3 of this Annex, governmental stockholding programmes for food security purposes in developing countries whose operation is transparent and conducted in accordance with officially published objective criteria or guidelines shall be considered to be in conformity with the provisions of this point, including programmes under which stocks of foodstuffs for food security purposes are acquired and released at administered prices, provided that the difference between the acquisition price and the external reference price is accounted for in the AMS.

(¹⁴) For the purposes of points 3 and 4 of this Annex, the provision of foodstuffs at subsidised prices with the objective of meeting food requirements of urban and rural poor in developing countries on a regular basis at reasonable prices shall be considered to be in conformity with the provisions of this point.