Mandelson kicks up a fuss over shoe imports

Trade Commissioner Peter Mandelson is asking member states to back a bid to soften the impact on European footwear makers of an avalanche of shoe imports from Asia. But the initiative has prompted warnings that the move could be challenged in the World Trade Organization (WTO).

Mandelson has asked EU governments to impose definitive import duties on imports of shoes from China and Vietnam following an investigation which found that the countries were guilty of unfairly subsidising shoemakers with state-backed commercial advantages.

He has proposed setting anti-dumping duties of 23% on imports of footwear from China and 29% on imports from Vietnam.

But he is suggesting excluding the first 140 million pairs from China and 95 million pairs from Vietnam from the dumping duties.

Normally anti-dumping duties apply to all imports and the move has prompted accusations that he is trying to introduce a duty-free quota. This would be illegal under WTO rules and could lay the EU open to a challenge. The Chinese are threatening to take the case to the WTO.

Jan Somers of the European Confederation of the Footwear Industry (CEC) said: "This kind of measures is not accepted in anti-dumping [cases]. It is very dangerous from the legal side," he said.

Somers said that Mandelson's approach was "ridiculous". The Commission had said it had found evidence of dumping so anti-dumping measures should apply to all imports, he argued.

Somers said that the levels of duty-free imports were "far too high" and would not alleviate the harm being done to European industry.

According to figures from CEC, which represents 14,000 EU footwear makers, the volume of footwear imports from China increased by 2,000% in 2005.

In a statement issued yesterday, the Federation of European Sporting Goods Industries (FESI) criticised the duties proposed by the Commission, saying they were much higher than under an earlier plan. It also condemned a decision to include children's shoes in the anti-dumping measures as a "dangerous step back into protectionism" which would "hurt Europe's poorer families most".

FESI, whose members include some of the world's largest sports shoe makers such as Adidas, Nike and Reebok, also warned that the Commission's bid to allocate import licences on a first-come-first-served basis would be "unworkable" and would lead to chaos in the market.

Mandelson's proposal was being discussed by member states' trade experts yesterday and today (19-20 July).

Industry experts believe that the proposal could be narrowly approved by member states although there might be changes on the level of duty-free imports, the duty rate and the scope of the measures in order to obtain a compromise.

The formal proposal will be adopted by the Commission at its first meeting after the summer break on 30 August and should be in place by October.

Observers said the EU was keen to get an agreement to prevent the issue dominating the EU-China summit on 9 September.

Trade Commissioner Peter Mandelson is asking member states to back a bid to soften the impact on European footwear makers of an avalanche of shoe imports from Asia. But the initiative has prompted warnings that the move could be challenged in the World Trade Organization (WTO).

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