From trade lawyer Bernard O'Connor:
So, as Shakespeare might have said, to conclude this little tale:
1) China agreed in 2001 when it joined the WTO that it was not a market economy.
2) There is nothing in Article 15 giving China the status of a market economy in 2016.
3) Rather, paragraph (d) of Article 15 shows that China must establish, according to EU rules, that it is a market economy if it is to benefit from market economy price comparison methodologies.
4) A gap in WTO law opens up after December 2016 as to what to do when producers from China under investigation in individual anti-dumping investigations cannot show that market economy conditions prevail in their industry.
5) This gap will need to be filled in those investigations. The AB allows investigating authorities to choose methodologies where no particular methodology is imposed by the GATT or the WTO Anti-Dumping Agreement so long as it is unbiased and objectively applied.
6) Thus the emergence of a gap in Article 15 does not remove the legal basis for the use of methodologies other than market economy methodologies.
7) The basic EU anti-dumping Regulation gives the EU Commission sufficient legal basis to chose appropriate methodologies when producers cannot show market economy conditions prevail in their industry.
8) No legislative change is therefore necessary (unless there is a need to introduce a system to evaluate the prevailing conditions in a particular industry) as a consequence of the expiry of sub section (a)(ii) of Article 15 of China’s WTO Accession Protocol.
The full paper is here. WTO litigation on these issues is almost guaranteed.
