Vermulst Verharghe Graafsma & Bronckers (VVGB)
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Ancient wisdom has it that ‘anything can happen’ in this year of the ‘Fire Monkey’ and indeed, while some of this year’s events could have been foreseen, such as the impending expiry of part of China’s Protocol of Accession, other remarkable incidents such as the Brexit vote have confirmed ancient wisdom. Such events – and the issues and challenges they present – have helped to further propel international trade law from a niche area of interest to a select few onto a stage with a larger and more captive audience.
Brexit has illustrated that a domestic decision can have unexpected and far-reaching international ramifications. And while the world is still struggling to fully comprehend its economic and trade impact, the trading relationship of a number of economies with China continues to attract attention. Notably, it remains to be seen how certain WTO members will respond to the impending expiry of part of China’s Protocol of Accession. The relevant part of Section 15 of the Protocol has thus far permitted investigating authorities to derogate from regular calculation methods to determine domestic prices and costs for Chinese products. This impending expiry, set for 11 December 2016, has already stirred up debates ranging from diverse places such as the European Parliament to the Global Trade and Customs Journal.
Moreover, the recent findings of the Panel in Argentina – Biodiesel, prohibiting investigating authorities from deviating from actual cost records of an exporter in regular market-economy anti-dumping proceedings, has further raised the stakes of the impending expiry of part of the Protocol. Although this Panel Report is currently still under appeal, the additional consequence of this Report is that, while on 11 December part of the Protocol will expire, the previously used alternative cost calculation methods for ‘regular’ market economies will likewise no longer be permitted towards China after that date. As a result of these combined constrictions, certain jurisdictions have felt compelled to initiate a flurry of anti-dumping proceedings right now, as currently they can still deviate from local Chinese costs and prices without controversy.