The World Trade Organisation (WTO) has disapproved the way the EU imposes extra duties on imports it considers unfairly priced in a case brought by China in a case with broad implications for EU trade policy.
The Reuters news agency says that in an interim report to be published next month, the WTO panel will say that the EU discriminated against Chinese exporters of screws and bolts compared to exporters from other countries when it applied a single anti-dumping duty based on the national principle.
Instead of imposing a blanket duty for the whole country, the EU will in future have to set individual duties for companies on case-by-case basis in order to comply with the WTO position.
The EU already uses the individual duty model in cases of countries it considers not to be market economies, such as Cuba, Albania or Vietnam.
"The amount of money at stake here is not huge in this case, but it will have repercussions on other anti-dumping cases," a person acquainted with the report told the Financial Times.
"It's a big victory for China as it takes out one of the pillars of EU anti-dumping activity against China," a similar contact told Reuters.
The WTO report will not backed China's claim that Brussels made unfair comparisons between high-end EU fasteners used in the car and aviation industries and low-grade Chinese screws and bolts sold in hardware shops, however.
China raised the case against the EU, its first since joining the organisation in 2001, in July 2009. Chinese imports in the disputed case, worth around Euro 575 million a year, were slapped with duties of up to 85 percent when entering the EU market.
In May 2010 the WTO set up an expert panel in another case brought by China against the EU on Chinese-made footwear. The Chinese authorities said when filling the complaint that the EU measures "violated various obligations under the WTO, and consequently caused damage to the legitimate rights and interests of Chinese exporters.
The EU in June has opened another anti-dumping case over below-cost Chinese imports of ceramic tiles, which saw the Chinese ministry of commerce threaten to punish EU-made iron and steel fasteners in return.
