Members review long list of safeguard actions at committee meeting
More than 30 safeguard-related actions of WTO members were put on the agenda for review at a meeting of the WTO’s Committee on Safeguards on 29 April. The European Union’s decision to impose a definitive safeguard measure against imports of steel products drew the most comments from members, with other actions by Canada, Egypt, Morocco and the Eurasian Economic Union (EAEU) on steel imports also drawing scrutiny.
Under the WTO Safeguards Agreement, a member may restrict imports of a product temporarily (take “safeguard” actions) through higher tariffs or other measures if its domestic industry is seriously injured, or threatened with serious injury, due to an unforeseen surge in imports. Unlike anti-dumping duties, safeguard measures cover imports from all countries, although imports from developing countries with a small share of imports are exempted through special and differential treatment provisions.
Japan, Korea, Australia and Chinese Taipei once again voiced their general concerns over what they said was the rising use of safeguard measures by WTO members, especially in the steel sector. Japan noted the increased use of safeguards by members responding to the trade-restrictive actions of others; this is depressing world trade and harming both importers and exporters.
Korea said that many of the measures imposed did not meet the requirements set out under the WTO’s Safeguards Agreement (SGA); the number of countries resorting to safeguards is growing rapidly as members react to measures previously applied. With steel such an important input for many downstream industries, the impact of these measures will affect many members.
Australia voiced concerns about the increasing number of safeguard measures as well as the lack of transparency. Chinese Taipei noted that safeguards were unique among trade defence measures in that, unlike anti-dumping or countervailing measures, the measures are applied against unfair trade as such. It was very concerned about their trade impact.
Actions on products related to steel
Seven members commented on the European Union’s decision in February to apply a definitive safeguard on 26 categories of steel products up to June 2021; this followed its decision in July 2018 to impose a provisional safeguard on steel imports. Several members said they were disappointed with the EU action and questioned whether the conditions for imposing a safeguard were met. Others noted a mid-term review of the measure would take place in July and expressed hope that it would lead to a reassessment of the measure. The EU said it has been consulting with many members on the issue and would notify the results of these consultations to the WTO.
Canada noted that its authorities in April found grounds to impose definitive safeguard measures on two steel products, down from seven products covered by provisional safeguards. Canada said a final decision on the definitive safeguards, which requires approval from the government’s Cabinet, will be notified to the WTO once a decision has been taken. Two members commented on Canada’s finding.
Egypt noted that at the end of March it decided to initiate a safeguard investigation on the import of semi-finished products of iron or non-alloy steel and steel rebar due to, among other things, a sudden and sharp increase in imports and the resulting impact on Egyptian producers. Two members commented on Egypt’s decision.
One member reiterated its concerns with Morocco’s recent frequent use of safeguard measures. Morocco assured members that the measures were in line with WTO requirements.
Two members questioned the Eurasian Economic Union’s decision to initiate a safeguard investigation on welded tubes of stainless steel. Russia noted that the safeguard investigation was still under way.
One member questioned Viet Nam’s decision to carry out a “circumvention” investigation arising from increased imports of steel products subject to its steel safeguard measure. Viet Nam said it would notify the Committee after the conclusion of the investigation.
Other matters
Chile’s decision to terminate its safeguard investigation on imports of powdered milk and Gouda cheese was welcomed by one member, while Russia explained that the EAEU had decided to terminate its safeguard investigation on imported microwave ovens
Members also commented on: India’s safeguard on imports of solar cells; Indonesia’s safeguard tariffs on imported aluminium foil; Madagascar’s provisional safeguard on pasta; the United States’ safeguard on large residential washers; the Philippines’ safeguard investigation on imports of float glass; South Africa’s safeguard investigation on threaded fasteners; Turkey’s safeguard measure on nylon yarn; and Morocco’s safeguard investigation on imported coated wood board.
Under “other business”, the initiation of safeguard investigations by the EAEU and Turkey on imports of certain flat-rolled and other steel products was raised by members.
Next meeting
The next meeting of the Committee on Safeguards is provisionally scheduled for the week of 4 November 2019.