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Antidumping and Safeguard Measures upon China’s En

  【作者:汪腾锋】

  Wang Tengfeng—Director of Zhiming Law Firm of Guangdong Province

  Upon China’s entry into WTO and when the Fourth Plenary Session of the Ninth National People’s Congress was held in Beijing from March 5—15, 2001, I am pleased to know that the Plenary Session has determined to formulate the first independent “Antidumping Act of the People’s Republic of China” in our country. Under the aforesaid specific condition, the author holds that it is one of the measures taken by the state to conform to the international trends of economic integration and legal globalization. Therefore, it is necessary for the experts in the field of economy, foreign trade and laws to strengthen the understanding and research on the knowledge and skills relating to the antidumping and safeguard measures in the international trade. Hereby this article presents some opinions on the relative problems of the derivative exceptional rules clauses from the antidumping actions in the international trade shown as follows:

  一、Introduction of the relative safeguard measures.

  Although the knowledge of laws and cases concerning the antidumping actions in the international trade has been frequently reported in the newspapers in the past few years and has been known to the ordinary people, yet the safeguard measures—a kind of exceptional institution of WTO closely related to antidumping has been rarely heard of hitherto. In 1994, WTO had reached the “Safeguard measures Agreement” by revising Article 19 of GATT in Uruguay Round Negotiation. With the fundamental meaning that when the unexpected substantial change of circumstances seriously going against the interests of the state party stated by the treaty occurs in the international trade as well as the outbalance of the interests among the states parties, the state party may terminate or seek for some remedies in order to protect its interests and rights, safeguard measures in the international trade, otherwise called “safeguard clause or escape clause”, is the “principle of substantial change of circumstances” in the international laws, the specific application in the international trade relation is the exceptional system in WTO as the rules of exception derivative from the antidumping in the international trade. Namely that one party among the state members in the free trade with fair competition may absolutely take safeguard actions upon some products made by all state members in order to protect the demands of the domestic industries, such as restraining on import to resist or dispel any damage or ill threatening to a certain home industry resulted from importing the identical product. The purpose of the safeguard measures in the international trade is to make it flexible, to some extent, for the states parties to the treaty to bear the treaty obligations so that they may be exempted from the corresponding obligations stipulated in the treaty under special circumstances to shun themselves from the material damages occurred or to avoid the possible consequences incurred from the threatening of the material damages. The safeguard measures have the same basic purpose as antidumping------to restrain import so as to protect the relative industries of the nation. Nevertheless, safeguard measures differ apparently from antidumping in the following:

  (一) Different scopes of application: Safeguard measures just incarnate the rule of nondiscrimination, while antidumping may be used as the means of discrimination. Antidumping is to restrain the actions of unfair trade with the imported products from certain country as the object of sanctions, while the imports restrained by safeguard measures are not necessarily concerned with any dumping, generally the imports under the condition of fair competition with the object of sanctions of the “import of a certain product” made by whatever country.

  (二) Different conditions for application: Safeguard measures have more conditions for application than the anti-dumping measures. Firstly, it shall testify the quantity of the imports is always on the increase within a certain period in relative number or in absolute number. Secondly, the material damages in the safeguard measures merely cover the damages and damage danger instead of hindering the establishment of an industry. On the contrary, the damages in antidumping cover hindering the establishment of an industry. In addition to this, the material damages in the safeguard measures may be serious enough to lead to the non-temporary, quite difficult or insolvent situation, and such damages are greater than the substantial damages in antidumping. Finally, on the basis of ensuring the increase of the import, the importing countries shall also validate if these increases are caused due to accidental circumstances or the performance of the obligations under GATT. While in the case of antidumping, they shall just prove that dumping products is one of the reasons causing the damage, but unnecessarily the significant or only reason.

  (三) Different procedures of application: In accordance with related stipulations formulated by the WTO, the state party executing the safeguard measures shall notify all state parties in writing in advance as soon as possible for all states parties and the state parties in grave interests with the export of the product to negotiate with it. The state party executing the safeguard measures shall immediately inform the Safeguard Measures Commission of the investigation processes, investigation conclusion and the decision to execute or delay to execute the safeguard measures and shall timely inform the negotiation result to the Goods Trading Council. All the state parties of WTO shall present the Safeguard Measures Commission with the laws, regulations and administrative procedures involved with the safeguard measures of their states.

  (四) Different applicable measures: Safeguard measures may be applied in an extensive scope, for example, such measures may be used to increase tariff, implement tariff quota, execute quantitative restriction, hold bilateral or multilateral trade negotiation, so on and so forth. While the antidumping measure is chiefly used to levy the antidumping duty and promise the price.

  二、Our state shall set up and enhance the effective mechanism of safeguard measures.

  The “Memorandum of Agreement on China’s Entry into WTO” made by and between the People’s Republic of China and the United States of America on the 15th November 1999 has stated a “Special Safeguard Clause” in order to prevent the increase in quantity of the products imported from China to USA. In this Article, the two nations agree to establish a special mechanism not only independent from the safeguard mechanism of WTO, but also different from the traditional safeguard measures so as to effectively protect the domestic enterprises and laborers upon the increase import. The new mechanism has abandoned the fare rules of free trade of nondiscrimination that are stressed and embodied by the “Safeguards Agreement” made by WTO, and it is specially set out for Chinese products. After China’s entry into WTO and at the same time of carrying out the said unequal clause, USA will also market various competitive commodities made at home to China. However, at present China has been devoid of the strategies, experiences and capability to respond to the foreign countries, such as USA, executing safeguard measures, as well as the relative mechanisms such as the laws, regulation and talented people to execute safeguard measures externally and positively according to the provisions of WTO. Although China has started to implement the “Law of the People’s Republic of China on Foreign Trade” from July 1st, 1994, whose Article 29 stipulates that “the state may take safeguard measures deemed necessary to eliminate or release the material damages to the manufacturers of the identical products made at home or the direct competitive products incurred by the increase of the quantity of the imports”, the fundamental clause of the aforegoing safeguard measures is only a clause of principle. It has not yet been determined how to apply and how to operate the relative auxiliary regulations such as those concerning the talents and institutes, etc., so it has not been put in practice. The national industries and home markets of China will come up against the badly unfair trading risks once the final protocol text for China’s entry into WTO has introduced the “Special Safeguard Clause” of America. As the approaching of the entry, the critical situation calls for China to set up and improve a full set of effective operating mechanism regarding safeguard measures as soon as possible. First, the National People’s Congress of our country shall attach much importance to the problems relating to the safeguard measures when constituting the “Antidumping Act of the People’s Republic of China” in the near future and shall formulate applicable laws upon relative provisions when drawing up the said Act. At the same time, it is more important for the Central Government and State Council of China to immediately organize experts to institute a concrete and detailed “Regulations of the People’s Republic of China on Safeguard Measures”. As an exercisable and realistic regulations, it shall not only stipulate the contents of safeguard measures, the organization to execute the measures, the survey means of safeguard measures, the conditions and standards for determining the need to execute the safeguard measures, but also start to establish the organizations to execute the safeguard measures, to train a great number of experts specialized in the economic trade and laws and familiar with the rules of WTO, especially those familiar with the antidumping and safeguard measures in the international trade. Only by doing so, can we avert the lack of the people specialized in executing antidumping and safeguard measures once China cannot respond to the free trade contacts, after its entry into WTO, especially when the foreign commodities are poured into China, can we avoid the embarrassed situation----substantial losses to the national economic benefits and the adverse effect on the image of our nation due to handling a great number of disputes in a hurry. Also only by doing so, can we protect the state’s interests to the maximum extent and the sound and stable development of the national industries of the People’s Republic of China.


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