Annexes to COM(2014)660 - Protection against subsidised imports from countries not members of the EU (codification) - Main contents
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| dossier | COM(2014)660 - Protection against subsidised imports from countries not members of the EU (codification). |
|---|---|
| document | COM(2014)660  |
| date | June 8, 2016 |
(5) Regulation (EU) No 182/2011 of the European Parliament and of the Council of 16 February 2011 laying down the rules and general principles concerning mechanisms for control by Member States of the Commission's exercise of implementing powers (OJ L 55, 28.2.2011, p. 13).
(6) Regulation (EU) No 952/2013 of the European Parliament and of the Council of 9 October 2013 laying down the Union Customs Code (OJ L 269, 10.10.2013, p. 1).
(7) Regulation (EU) 2016/1036 of the European Parliament and of the Council of 8 June 2016 on protection against dumped imports from countries not members of the European Union (see page 21 of this Official Journal).
(8) Council Regulation (EC) No 1667/2006 of 7 November 2006 on glucose and lactose (OJ L 312, 11.11.2006, p. 1).
(9) Council Regulation (EC) No 614/2009 of 7 July 2009 on the common system of trade for ovalbumin and lactalbumin (OJ L 181, 14.7.2009, p. 8).
(10) Council Regulation (EC) No 1216/2009 of 30 November 2009 laying down the trade arrangements applicable to certain goods resulting from the processing of agricultural products (OJ L 328, 15.12.2009, p. 10).
ANNEX I
ILLUSTRATIVE LIST OF EXPORT SUBSIDIES
| (a) | The provision by governments of direct subsidies to a firm or an industry contingent upon export performance. |
| (b) | Currency retention schemes or any similar practices which involve a bonus on exports. |
| (c) | Internal transport and freight charges on export shipments, provided or mandated by governments, on terms more favourable than for domestic shipments. |
| (d) | The provision by governments or their agencies either directly or indirectly through government-mandated schemes, of imported or domestic products or services for use in the production of exported goods, on terms or conditions more favourable than for provision of like or directly competitive products or services for use in the production of goods for domestic consumption, if (in the case of products) such terms or conditions are more favourable than those commercially available (1) on world markets to their exporters. |
| (e) | The full or partial exemption, remission, or deferral (2) specifically related to exports, of direct taxes (3) or social welfare charges paid or payable by industrial or commercial enterprises. |
| (f) | The allowance of special deductions directly related to exports or export performance, over and above those granted in respect of production for domestic consumption, in the calculation of the base on which direct taxes are charged. |
| (g) | The exemption or remission, in respect of the production and distribution of exported products, of indirect taxes (4) in excess of those levied in respect of the production and distribution of like products when sold for domestic consumption. |
| (h) | The exemption, remission or deferral of prior-stage cumulative indirect taxes (4) on goods or services used in the production of exported products in excess of the exemption, remission or deferral of like prior-stage cumulative indirect taxes on goods or services used in the production of like products when sold for domestic consumption; provided, however, that prior-stage cumulative indirect taxes may be exempted, remitted or deferred on exported products even when not exempted, remitted or deferred on like products when sold for domestic consumption, if the prior-stage cumulative indirect taxes are levied on inputs that are consumed in the production of the exported product (making normal allowance for waste) (5). This item shall be interpreted in accordance with the guidelines on consumption of inputs in the production process contained in Annex II. |
| (i) | The remission or drawback of import charges (4) in excess of those levied on imported inputs that are consumed in the production of the exported product (making normal allowance for waste); provided, however, that in particular cases a firm may use a quantity of home market inputs equal to, and having the same quality and characteristics as, the imported inputs as a substitute for them in order to benefit from this provision if the import and the corresponding export operations both occur within a reasonable time period, not to exceed two years. This item shall be interpreted in accordance with the guidelines on consumption of inputs in the production process contained in Annex II and the guidelines in the determination of substitution drawback systems as export subsidies contained in Annex III. |
| (j) | The provision by governments (or special institutions controlled by governments) of export credit guarantee or insurance programmes, of insurance or guarantee programmes against increases in the cost of exported products or of exchange risk programmes, at premium rates which are inadequate to cover the long-term operating costs and losses of the programmes. |
| (k) | The grant by governments (or special institutions controlled by and/or acting under the authority of governments) of export credits at rates below those which they actually have to pay for the funds so employed (or would have to pay if they borrowed on international capital markets in order to obtain funds of the same maturity and other credit terms and denominated in the same currency as the export credit), or the payment by them of all or part of the costs incurred by exporters or financial institutions in obtaining credits, in so far as they are used to secure a material advantage in the field of export credit terms. Provided, however, that if a Member of the WTO is a party to an international undertaking on official export credits to which at least 12 original such Members are parties as of 1 January 1979 (or a successor undertaking which has been adopted by those original Members), or if in practice a Member of the WTO applies the interest rates provisions of the relevant undertaking, an export credit practice which is in conformity with those provisions shall not be considered an export subsidy. |
| (l) | Any other charge on the public account constituting an export subsidy in the sense of Article XVI of the GATT 1994. |
(1) ‘Commercially available’ means that the choice between domestic and imported products is unrestricted and depends only on commercial considerations.
(2) Deferral may not amount to an export subsidy where, for example, appropriate interest charges are collected.
(3) For the purposes of this Regulation:
| — | ‘direct taxes’ means taxes on wages, profits, interests, rents, royalties, and all other forms of income, and taxes on the ownership of real property, |
| — | ‘import charges’ means tariffs, duties, and other fiscal charges not elsewhere enumerated in this footnote that are levied on imports, |
| — | ‘indirect taxes’ means sales, excise, turnover, value added, franchise, stamp, transfer, inventory and equipment taxes, border taxes and all taxes other than direct taxes and import charges, |
| — | ‘prior-stage’ indirect taxes are those levied on goods or services used directly or indirectly in making the product, |
| — | ‘cumulative’ indirect taxes are multi-staged taxes levied where there is no mechanism for subsequent crediting of the tax if the goods or services subject to tax at one stage of production are used in a succeeding state of production, |
| — | ‘remission’ of taxes includes the refund or rebate of taxes, |
| — | ‘remission or drawback’ includes the full or partial exemption or deferral of import charges. |
(4) See footnote 2 to point (e).
(5) Point (h) does not apply to value added tax systems and border-tax adjustment in lieu thereof; the problem of the excessive remission of value added taxes is exclusively covered by point (g).
ANNEX II
GUIDELINES ON CONSUMPTION OF INPUTS IN THE PRODUCTION PROCESS (1)
| 1. | Indirect tax rebate schemes can allow for exemption, remission or deferral of prior-stage cumulative indirect taxes levied on inputs that are consumed in the production of the exported product (making normal allowance for waste). Similarly, drawback schemes can allow for the remission or drawback of import charges levied on inputs that are consumed in the production of the exported product (making normal allowance for waste). |
| 2. | The illustrative list of export subsidies in Annex I makes reference to the term ‘inputs that are consumed in the production of the exported product’ in points (h) and (i). Pursuant to point (h), indirect tax rebate schemes can constitute an export subsidy to the extent that they result in exemption, remission or deferral of prior-stage cumulative indirect taxes in excess of the amount of such taxes actually levied on inputs that are consumed in the production of the exported product. Pursuant to point (i), drawback schemes can constitute an export subsidy to the extent that they result in a remission or drawback of import charges in excess of those actually levied on inputs that are consumed in the production of the exported product. Both points stipulate that normal allowance for waste must be made in findings regarding consumption of inputs in the production of the exported product. Point (i) also provides for substitution, where appropriate. |
| 3. | In examining whether inputs are consumed in the production of the exported product, as part of a countervailing duty investigation pursuant to this Regulation, the Commission must normally proceed on the following basis. |
| 4. | Where it is alleged that an indirect tax rebate scheme, or a drawback scheme, conveys a subsidy by reason of over-rebate or excess drawback of indirect taxes or import charges on inputs consumed in the production of the exported product, the Commission must normally first determine whether the government of the exporting country has in place and applies a system or procedure to confirm which inputs are consumed in the production of the exported product and in what amounts. Where such a system or procedure is determined to be applied, the Commission must normally then examine the system or procedure to see whether it is reasonable, effective for the purpose intended, and based on generally accepted commercial practices in the country of export. The Commission may deem it necessary to carry out, in accordance with Article 26(2), certain practical tests in order to verify information or to satisfy itself that the system or procedure is being effectively applied. |
| 5. | Where there is no such system or procedure, where it is not reasonable, or where it is instituted and considered reasonable but is found not to be applied or not to be applied effectively, a further examination by the exporting country based on the actual inputs involved will normally need to be carried out in the context of determining whether an excess payment occurred. If the Commission deems it necessary, a further examination may be carried out in accordance with point 4. |
| 6. | The Commission must normally treat inputs as physically incorporated if such inputs are used in the production process and are physically present in the product exported. An input need not be present in the final product in the same form in which it entered the production process. |
| 7. | In determining the amount of a particular input that is consumed in the production of the exported product, a ‘normal allowance for waste’ must normally be taken into account, and such waste must normally be treated as consumed in the production of the exported product. The term ‘waste’ refers to that portion of a given input which does not serve an independent function in the production process, is not consumed in the production of the exported product (for reasons such as inefficiencies) and is not recovered, used or sold by the same manufacturer. |
| 8. | The Commission's determination of whether the claimed allowance for waste is ‘normal’ must normally take into account the production process, the average experience of the industry in the country of export, and other technical factors, as appropriate. The Commission must bear in mind that an important question is whether the authorities in the exporting country have reasonably calculated the amount of waste, when such an amount is intended to be included in the tax or duty rebate or remission. |
(1) Inputs consumed in the production process are inputs physically incorporated, energy, fuels and oil used in the production process and catalysts which are consumed in the course of their use to obtain the exported product.
ANNEX III
GUIDELINES IN THE DETERMINATION OF SUBSTITUTION DRAWBACK SYSTEMS AS EXPORT SUBSIDIES
I
Drawback systems can allow for the refund or drawback of import charges on inputs which are consumed in the production process of another product and where the export of this latter product contains domestic inputs having the same quality and characteristics as those submitted for the imported inputs. Pursuant to point (i) of Annex I, substitution drawback systems can constitute an export subsidy to the extent that they result in an excess drawback of the import charges levied initially on the imported inputs for which drawback is being claimed.
II
In examining any substitution drawback system as part of a countervailing duty investigation pursuant to this Regulation, the Commission must normally proceed on the following basis:
| 1. | point (i) of Annex I stipulates that home market inputs may be substituted for imported inputs in the production of a product for export provided such inputs are equal in quantity to, and have the same quality and characteristics as, the imported inputs being substituted. The existence of a verification system or procedure is important because it enables the government of the exporting country to ensure and demonstrate that the quantity of inputs for which drawback is claimed does not exceed the quantity of similar products exported, in whatever form, and that there is no drawback of import charges in excess of those originally levied on the imported inputs in question; |
| 2. | where it is alleged that a substitution drawback system conveys a subsidy, the Commission must normally first proceed to determine whether the government of the exporting country has in place and applies a verification system or procedure. Where such a system or procedure is determined to be applied, the Commission shall normally then examine the verification procedures to see whether they are reasonable, effective for the purpose intended, and based on generally accepted commercial practices in the country of export. To the extent that the procedures are determined to meet this test and are effectively applied, no subsidy will be presumed to exist. It may be deemed necessary by the Commission to carry out, in accordance with Article 26(2), certain practical tests in order to verify information or to satisfy itself that the verification procedures are being effectively applied; |
| 3. | where there are no verification procedures, where they are not reasonable, or where such procedures are instituted and considered reasonable but are found not to be actually applied or not to be applied effectively, there may be a subsidy. In such cases, further examination by the exporting country based on the actual transactions involved would need to be carried out to determine whether an excess payment occurred. If the Commission deems it necessary, a further examination may be carried out in accordance with point 2; |
| 4. | the existence of a substitution drawback provision under which exporters are allowed to select particular import shipments on which drawback is claimed should not of itself be considered to convey a subsidy; |
| 5. | an excess drawback of import charges within the meaning of point (i) of Annex I would be deemed to exist where governments paid interest on any monies refunded under their drawback schemes, to the extent of the interest actually paid or payable. |
ANNEX IV
(This Annex reproduces Annex 2 to the Agreement on Agriculture. Any terms or expressions which are not explained herein or which are not self-explanatory are to be interpreted in the context of that Agreement.)
DOMESTIC SUPPORT: THE BASIS OF EXEMPTION FROM THE REDUCTION COMMITMENTS
1. Domestic support measures for which exemption from the reduction commitments is claimed shall meet the fundamental requirement that they have no, or at most minimal, trade-distorting effects or effects on production. Accordingly, all measures for which exemption is claimed shall conform to the following basic criteria:
| (a) | the support in question shall be provided through a publicly-funded government programme (including government revenue foregone) not involving transfers from consumers; and |
| (b) | the support in question shall not have the effect of providing price support to producers; |
plus policy-specific criteria and conditions as set out below.
Government service programmes
2. General services
Policies in this category involve expenditures (or revenue foregone) in relation to programmes which provide services or benefits to agriculture or the rural community. They shall not involve direct payments to producers or processors. Such programmes, which include but are not restricted to the following list, shall meet the general criteria in point 1 and policy-specific conditions where set out below:
| (a) | research, including general research, research in connection with environmental programmes, and research programmes relating to particular products; |
| (b) | pest and disease control, including general and product-specific pest and disease control measures, such as early-warning systems, quarantine and eradication; |
| (c) | training services, including both general and specific training facilities; |
| (d) | extension and advisory services, including the provision of means to facilitate the transfer of information and the results of research to producers and consumers; |
| (e) | inspection services, including general inspection services and the inspection of particular products for health, safety, grading or standardisation purposes; |
| (f) | marketing and promotion services, including market information, advice and promotion relating to particular products but excluding expenditure for unspecified purposes that could be used by sellers to reduce their selling price or confer a direct economic benefit to purchasers; and |
| (g) | infrastructural services, including: electricity reticulation, roads and other means of transport, market and port facilities, water supply facilities, dams and drainage schemes, and infrastructural works associated with environmental programmes. In all cases the expenditure shall be directed to the provision or construction of capital works only, and shall exclude the subsidised provision of on-farm facilities other than for the reticulation of generally available public utilities. It shall not include subsidies to inputs or operating costs, or preferential user charges. |
3. Public stockholding for food security purposes (1)
Expenditures (or revenue foregone) in relation to the accumulation and holding of stocks of products which form an integral part of a food security programme identified in national legislation. This may include government aid to private storage of products as part of such a programme.
The volume and accumulation of such stocks shall correspond to predetermined targets related solely to food security. The process of stock accumulation and disposal shall be financially transparent. Food purchases by the government shall be made at current market prices and sales from food security stocks shall be made at no less than the current domestic market price for the product and quality in question.
4. Domestic food aid (2)
Expenditure (or revenue foregone) in relation to the provision of domestic food aid to sections of the population in need.
Eligibility to receive the food aid shall be subject to clearly-defined criteria related to nutritional objectives. Such aid shall be in the form of direct provision of food to those concerned or the provision of means to allow eligible recipients to buy food either at market or at subsidised prices. Food purchases by the government shall be made at current market prices and the financing and administration of the aid shall be transparent.
5. Direct payments to producers
Support provided through direct payments (or revenue foregone, including payments in kind) to producers for which exemption from reduction commitments as claimed shall meet the basic criteria set out in point 1, plus specific criteria applying to individual types of direct payment as set out in points 6 to 13. Where exemption from reduction is claimed for any existing or new type of direct payment other than those specified in points 6 to 13, it shall conform to criteria set out in points 6(b) to (e), in addition to the general criteria set out in point 1.
6. Decoupled income support
| (a) | Eligibility for such payments shall be determined by clearly-defined criteria such as income, status as a producer or landowner, factor use or production level in a defined and fixed base period. |
| (b) | The amount of such payments in any given year shall not be related to, or based on, the type or volume of production (including livestock units) undertaken by the producer in any year after the base period. |
| (c) | The amount of such payments in any given year shall not be related to, or based on, the prices, domestic or international, applying to any production undertaken in any year after the base period. |
| (d) | The amount of such payments in any given year shall not be related to, or based on, the factors of production employed in any year after the base period. |
| (e) | No production shall be required in order to receive such payments. |
7. Government financial participation in income insurance and income safety-net programmes
| (a) | Eligibility for such payments shall be determined by an income loss, taking into account only income derived from agriculture, which exceeds 30 % of average gross income or the equivalent in net income terms (excluding any payments from the same or similar schemes) in the preceding three-year period or a three-year average based on the preceding five-year period, excluding the highest and the lowest entry. Any producer meeting this condition shall be eligible to receive the payments. |
| (b) | The amount of such payments shall compensate for less than 70 % of the producer's income loss in the year the producer becomes eligible to receive this assistance. |
| (c) | The amount of any such payments shall relate solely to income; it shall not relate to the type or volume of production (including livestock units) undertaken by the producer; or to the prices, domestic or international, applying to such production; or to the factors of production employed. |
| (d) | Where a producer receives in the same year payments pursuant to this point and pursuant to point 8 (relief from natural disasters), the total of such payments shall be less than 100 % of the producer's total loss. |
8. Payments (made either directly or by way of a government financial participation in crop insurance schemes) for relief from natural disasters
| (a) | Eligibility for such payments shall arise only following a formal recognition by government authorities that a natural or like disaster (including disease outbreaks, pest infestations, nuclear accidents, and war on the territory of the Member concerned) has occurred or is occurring; and shall be determined by a production loss which exceeds 30 % of the average of production in the preceding three-year period or a three-year average based on the preceding five-year period, excluding the highest and the lowest entry. |
| (b) | Payments made following a disaster shall be applied only in respect of losses of income, livestock (including payments in connection with the veterinary treatment of animals), land or other production factors due to the natural disaster in question. |
| (c) | Payments shall compensate for not more than the total cost of replacing such losses and shall not require or specify the type or quantity of future production. |
| (d) | Payments made during a disaster shall not exceed the level required to prevent or alleviate further loss as defined in criterion set out in point (b). |
| (e) | Where a producer receives in the same year payments pursuant to this point and pursuant to point 7 (income insurance and income safety-net programmes), the total of such payments shall be less than 100 % of the producer's total loss. |
9. Structural adjustment assistance provided through producer retirement programmes
| (a) | Eligibility for such payments shall be determined by reference to clearly defined criteria in programmes designed to facilitate the retirement of persons engaged in marketable agricultural production, or their movement to non-agricultural activities. |
| (b) | Payments shall be conditional upon the total and permanent retirement of the recipients from marketable agricultural production. |
10. Structural adjustment assistance provided through resource retirement programmes
| (a) | Eligibility for such payments shall be determined by reference to clearly defined criteria in programmes designed to remove land or other resources, including livestock, from marketable agricultural production. |
| (b) | Payments shall be conditional upon the retirement of land from marketable agricultural production for a minimum of three years, and in the case of livestock on its slaughter or definitive permanent disposal. |
| (c) | Payments shall not require or specify any alternative use for such land or other resources which involves the production of marketable agricultural products. |
| (d) | Payments shall not be related to either type or quantity of production or to the prices, domestic or international, applying to production undertaken using the land or other resources remaining in production. |
11. Structural adjustment assistance provided through investment aids
| (a) | Eligibility for such payments shall be determined by reference to clearly-defined criteria in government programmes designed to assist the financial or physical restructuring of a producer's operations in response to objectively demonstrated structural disadvantages. Eligibility for such programmes may also be based on a clearly defined government programme for the reprivatisation of agricultural land. |
| (b) | The amount of such payments in any given year shall not be related to, or based on, the type or volume of production (including livestock units) undertaken by the producer in any year after the base period other than as provided for under criterion (e). |
| (c) | The amount of such payments in any given year shall not be related to, or based on, the prices, domestic or international, applying to any production undertaken in any year after the base period. |
| (d) | The payments shall be given only for the period of time necessary for the realisation of the investment in respect of which they are provided. |
| (e) | The payments shall not mandate or in any way designate the agricultural products to be produced by the recipients except to require them not to produce a particular product. |
| (f) | The payments shall be limited to the amount required to compensate for the structural disadvantage. |
12. Payments under environmental programmes
| (a) | Eligibility for such payments shall be determined as part of a clearly-defined government environmental or conservation programme and be dependent on the fulfilment of specific conditions under the government programme, including conditions related to production methods or inputs. |
| (b) | The amount of payment shall be limited to the extra costs or loss of income involved in complying with the government programme. |
13. Payments under regional assistance programmes
| (a) | Eligibility for such payments shall be limited to producers in disadvantaged regions. Each such region must be a clearly designated contiguous geographical area with a definable economic and administrative identity, considered as disadvantaged on the basis of neutral and objective criteria clearly spelt out in a law or regulation and indicating that the region's difficulties arise out of more than temporary circumstances. |
| (b) | The amount of such payments in any given year shall not be related to, or based on, the type or volume of production (including livestock units) undertaken by the producer in any year after the base period other than to reduce that production. |
| (c) | The amount of such payments in any given year shall not be related to, or based on, the prices, domestic or international, applying to any production undertaken in any year after the base period. |
| (d) | Payments shall be available only to producers in eligible regions, but generally available to all producers within such regions. |
| (e) | Where related to production factors, payments shall be made at a degressive rate above a threshold level of the factor concerned. |
| (f) | The payments shall be limited to the extra costs or loss of income involved in undertaking agricultural production in the prescribed area. |
(1) For the purpose of point 3 of this Annex, governmental stockholding programmes for food security purposes in developing countries whose operation is transparent and conducted in accordance with officially published objective criteria or guidelines shall be considered to be in conformity with the provisions of this point, including programmes under which stocks of foodstuffs for food security purposes are acquired and released at administered prices, provided that the difference between the acquisition price and the external reference price is accounted for in the AMS.
(2) For the purposes of points 3 and 4 of this Annex, the provision of foodstuffs at subsidised prices with the objective of meeting food requirements of urban and rural poor in developing countries on a regular basis at reasonable prices shall be considered to be in conformity with the provisions of this point.
ANNEX V
REPEALED REGULATION WITH THE AMENDMENT THERETO
| Council Regulation (EC) No 597/2009 (OJ L 188, 18.7.2009, p. 93) | |
| Regulation (EU) No 37/2014 of the European Parliament and of the Council (OJ L 18, 21.1.2014, p. 1) | Only point 18 of the Annex |
ANNEX VI
CORRELATION TABLE
| Regulation (EC) No 597/2009 | This Regulation |
| Articles 1 to 11 | Articles 1 to 11 |
| Article 12(1) to (4) | Article 12(1) to (4) |
| Article 12(6) | Article 12(5) |
| Articles 13 and 14 | Articles 13 and 14 |
| Article 15(1) | Article 15(1) |
| Article 15(2), first sentence | Article 15(2), first subparagraph |
| Article 15(2), second sentence | Article 15(2), second subparagraph |
| Article 15(3) | Article 15(3) |
| Articles 16 to 27 | Articles 16 to 27 |
| Article 28(1) to (4) | Article 28(1) to (4) |
| Article 28(5), first sentence | Article 28(5), first subparagraph |
| Article 28(5), second sentence | Article 28(5), second subparagraph |
| Article 28(6) | Article 28(6) |
| Articles 29 to 33 | Articles 29 to 33 |
| Article 33a | Article 34 |
| Article 34 | Article 35 |
| Article 35 | Article 36 |
| Annexes I to IV | Annexes I to IV |
| Annex V | — |
| Annex VI | — |
| — | Annex V |
| — | Annex VI |