Environment trumps trade in Chinese lightbulb case

Due to state intervention and other market distortions in China, manufacturers there have been able to sell energy-saving bulbs on the European markets for less than they cost to make, damaging the competitiveness of domestically produced equivalent.

To protect European manufacturers, and those outside the EU, the union has imposed anti-dumping tariffs on the Chinese bulbs since 2001.

When the policy imposing these duties was due to expire in 2006 the Commission launched a review to look at whether an extension for a further five years was appropriate.

The Commission has now concluded that the duty be scrapped next year, and is giving member states a month to consider the recommendation.

It argues that as the EU has made efficient energy use and conservation a key priority it should do what it can to promote the import of energy-saving bulbs.

Europe is likely to be able to meet only 25% of its demand for the lightbulbs through domestic production.

In the Commission’s judgement it is not in the community interest in these circumstances to be adding a significant additional cost to the price of imported products.

“The European Commission will recommend to Member States that it is in the interest of the EU to remove these duties in the next year,” said Peter Mandelson.

“This case has once again shown the complexities of managing anti-dumping rules in a global economy and against the broad range of EU interests.”

By delaying the lifting of the tariff until next year the EC believes it is allowing European companies time to adjust to new patterns of production and trade before the duties are discontinued.

David Gibbs