Duty put on handbags from China

Date: 31/07/1997

By Mark Turner

THE EU looks set to impose permanent anti-dumping duties on Chinese handbags next week following a last-minute deal between EU trading countries and leather producers.

The decision, which is due to become official next Monday (4 August), will lead to duties of 38&percent; on the 10.5 million leather or patent leather handbags exported from China each year.

It follows complaints, upheld by the European Commission, that Chinese handbags are being dumped on Union markets at an artificially low price, causing, on balance, damage to European industry.

But the move, which has been criticised by free trade lobbies, was only possible following Commission promises that provisional duties imposed up until now will be reimbursed to EU handbag importers.

Although the Commission can impose temporary duties on imports for six weeks, it needs support from a majority (eight) of Union member states to make them permanent.

Up until last week, only Belgium, France, Greece, Spain and Portugal supported the move. Germany, the UK, Ireland, Luxembourg, Austria, Finland and Sweden all opposed levies, arguing that they would do more to harm EU industry.

In a compromise, the Commission agreed to refund any money lost by importers through provisional duties so far, in return for permanent duties as of next week.

This satisfied Vienna, which was under instructions to protect its large mail-order industry. Finally, only the UK, Ireland, Germany, Finland and Sweden stood out against the decision.

But European retail lobby EuroCommerce has criticised the move. “Given the increased production and healthy export performance of European producers, as well as the small market share of Chinese leather handbags, this decision is not justified,” it said.