Commercial Information Circulars

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e-mail address : enquiry@tid.gov.hk

Ref : CR EIC 230/1/5/14

CR EIC 230/1/5/26

28 April 2004

Dear Sirs,

Commercial Information Circular No. 110/2004

European Union (EU)* :Alignment of Customs Tariff and Anti-dumping Measures upon EU Enlargement

The EU will be joined by ten new member states (i.e. Cyprus, the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, the Slovak Republic and Slovenia) on 1 May 2004. Upon accession to the EU, these new member states will adopt a number of trade measures to align their trade regimes with that of the EU. Areas of direct interest to Hong Kong include alignment of customs tariff and anti-dumping measures.

DETAILS

2. The EU started a new wave of accession negotiations in 1998 to pave way for its further enlargement. At the European Council meeting held in December 2002, the EU successfully completed the accession negotiations with ten acceding countries. The corresponding Treaty of Accession was signed in Athens on 16 April 2003. With the successful ratification of the Treaty by all the current member states and the acceding countries, the enlargement will take place on 1 May 2004. From that day onwards, these new member states will apply the EU's common commercial policy, including the common customs tariff (CCT), and trade defence measures such as anti-dumping duties.

Alignment of Tariff

3. The EU's CCT will apply to the new member states immediately upon accession, except for certain transitional arrangements to be administered by Hungary and Malta¹. As far as Hong Kong's major domestic exports to the ten new member states are concerned, their existing tariff rates (except those of Estonia²) are higher than the EU's CCT for most product sectors. As a whole, the adoption of the CCT would bring down the total tariff payable for Hong Kong's domestic exports to these new member states.

Application of Existing EU Anti-Dumping Measures

4. Anti-dumping measures currently in force in the EU will be automatically extended to the ten new member states after their accession. According to the attached (pdf format) notice recently published by the European Commission (EC), third country exporters to the EU may request for a review of any extended measures provided they submit sufficient evidence to show that circumstances have changed following the EU enlargement. Interested parties are invited to visit the trade defence enlargement website of the EC (under http://europa.eu.int/comm/trade/issues/respectrules/tdi_enlarg/index_en.htm) for further information and for details of a helpdesk facility.
    

5. For products originating in Hong Kong, the EU currently maintains anti-dumping duties on imports of 3.5" microdisks. The duty rates range from 6.7% to 27.4% of the net, free-at-Community-frontier price before duty³. Our domestic exports of all types of magnetic disks (including 3.5" microdisks) to the ten new member states are minimal with about HK$52,000 recorded in 2002 and virtually zero in 2003.

Domestic Exports to the Ten New Member States

6. Hong Kong's trade volume with the ten new member states is small. In 2003, Hong Kong's domestic exports to those ten countries totalled HK$175 million and was equivalent to 0.8% of Hong Kong's total domestic exports to the EU15. (0.14% of total domestic exports worldwide)

ENQUIRIES

7. For enquiries concerning the content of this circular, please contact the undersigned at telephone number 2398 5351.

Yours faithfully,

(Ricky CHENG)

for Director-General of Trade and Industry

* : The EU currently has 15 member states (EU15). They are Austria, Belgium, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, the Netherlands, Portugal, Spain, Sweden and the United Kingdom.

1 : Under the Treaty of Accession, Hungary may until the end of the third year following the date of accession or until 31 December 2007, whichever is the earlier, open a yearly tariff quota for imports of aluminium, not alloyed (CN Code 76011000) at reduced rate of the prevailing EU tariff. Similarly, Malta may until the end of the fifth year following the date of accession or until 31 December 2008, whichever is the earlier, open yearly tariff quotas for imports of certain products [viz. woven fabrics of combed wool or of combed fine animal hair (CN Code 51121110), denim (CN Code 52094200), woven fabrics of artificial filament yarn (CN Code 54082210), and other made-up clothing accessories (CN Code 62171000)] at reduced rates of the prevailing EU tariff.

2 : Estonia maintains zero applied tariff rates on industrial products.

3 : Please refer to Commercial Information Circular No. 40/2002 of 1 March 2002.