The Commission’s 15-month investigation brought to light that the Chinese government was significantly subsidising its coated paper industry by giving cheap loans, allocating land below market value and granting various tax incentives. None
of these subsidies are in line with the obligations China signed up to when joining the World Trade Organisation (WTO)
in 2001.

The quickly increasing dumped and subsidised Chinese exports to the EU exerted undue price pressure on the EU market, which in turn had a significant negative effect on the financial and operational performance of European producers of coated fine paper in the past years.

The imposition of the anti-dumping and anti-subsidy measures is the result of a thorough and in-depth fact-finding investigation by the Commission. Commission officials carried out verification visits at the premises of the government of China, the two main Chinese exporters, a selection of representative European paper producers and paper merchants.

Information provided by a large number of printers and their European and national associations completed the Commission’s analysis. The investigation was carried out on the basis of detailed rules that were multilaterally agreed in the WTO and which ensure proper transparency and objectivity for all parties.

Users of coated paper, such as printers, will perhaps be  disappointed by these measures. Indeed, it cannot be ruled out that the anti-dumping and anti-subsidy duties might result in increased prices for coated fine paper. However, these price increases, if any, will be very limited. A healthy competition is ensured because the level of the duties is moderate in terms of trade defence (20 to 39%), and the EU market remains open to sources of supply from other countries. In such circumstances, the law stipulates that the interests of the EU coated paper industry prevail over the interests of consumers of coated paper.

This case has also to be put in a wider and long-term context. Statistics already show that China not only exports paper, but that it also ships in increasing quantities printed material to the EU. This is a clear indication that China’s trade-distorting interventions in the market will not stop with coated paper but may well go further down the value chain in the paper sector. What happened today to the coated paper industry can equally happen tomorrow to printing companies, for example. Trade defence instruments are the only means to counter a country’s aggressive industrial policy that unduly supports its own industry at the expense of foreign competitors. We believe that with these measures in place, the EU re-establishes a level playing field in its market under conditions of fair competition.

John Clancy is an EU trade spokesman