RESOLUTION OF THE ECSC CONSULTATIVE COMMITTEE FOR THE NEED FOR EFFECTIVE IMPLEMENTATION OF THE TRADE DEFENCE INSTRUMENTS TO SAFEGUARD THE SUSTAINABLE COMPETITIVITY OF THE EUROPEAN UNION STEEL INDUSTRY

(1999/C 321/07)

(adopted unanimously during the 347th Session of 15 October 1999)

THE ECSC CONSULTATIVE COMMITTEE

- referring to its previous resolutions devoted totally or partially to problems concerning EU imports and most recently to that dated 23 October 1998(1),

- referring to the comunication on the state of the competitiveness of the steel industry in the European Union adopted by the Commission on 5 October 1999(2).

NOTING THAT:

- the retention of an indigenous steel industry is essential to the long-term viability of the EU as a manufacturing base, the steel industry constitutes an essential element of the industrial framework of the European economy, all other manufacturing sectors depend to varying degrees on steel as a material,

- consumers of steel require an effective and competitive steel industry capable of providing product and quality requirements with competitive prices (see point 2.3 of the communication on competitivity),

- customers of the steel industry therefore look to the EU steel industry to continue its substantial investment programme in new plant processes and in research and development (see point 4.1.3 of the communication on competitivity),

- however, forward investment by the steel industry was threatened by the financial consequences of the price collapse caused by the development of imports in 1998 endangering research programmes and risking undermining thereby the competitivity of the industry and its ability to respond to the needs of its clients. Prices fell as from the second quarter 1998 by 30 % in one year to their lowest level in 25 years,

- this price collapse occurred in the positive phase of the business cycle putting the industry in a loss situation, preventing the industry therefore from building the reserves necessary for the negative phase of the cycle, weakening therefore the viability of the industry in Europe and placing its workforce under threat.

THEREFORE THE ECSC CONSULTATIVE COMMITTEE,

- CONSIDERS that the maintenance of fair trade is in the interests of the steel industry, its workforce and customers. It is an essential condition for the maintenance of an efficient, competitive steel industry in the EU,

- REQUESTS the Commission urgently to re-establish the market stability that steel producers, workforce and customers require,

- CONSIDERS that such market stability can be achieved by giving urgent relief from unfairly traded and injurious imports,

- OBSERVES that the communication on durable competitivity affirms that "an essential condition is the existence of fair competition on all steel markets. The Commission is resolved to promote and ensure the respect for strict discipline in competition ...",

- CONSIDERS that today the way in which the trade defence instruments are used by the EU and by its major trading partners constitutes an important factor in the competitivity of the steel industry,

- STRESSES the importance of the European Union applying its trade laws effectively,

- STRONGLY REGRETS the decision by Sir Leon Brittan on the eve of the end of his mandate as a European Commissioner not to propose the imposition of provisional measures against imports of hot rolled coil from South Africa, Bulgaria, India, Iran, Taiwan and Yugoslavia which were the subject of a complaint filed by Eurofer in November 1998 on behalf of 11 European producers,

- CONSIDERS that the necessary conditions for the imposition of provisional duties - dumping margins, causality and the presence of injury in the investigation period - were clearly established by the Commission services and that provisional duties were entirely appropriate in this case. Failure to propose such measures ignored well-founded evidence of injury and could therefore be considered to be based more on political reasoning than on technical criteria,

- NOTES that imports of hot rolled coil from the six countries subject to the complaint represented less than 50 % of coil imports in 1998. The complaint therefore was not designed to close the European market to third country imports but rather to request action against predatory imports traded under conditions which do not conform to WTO rules,

- URGES therefore the European Commission to conclude rapidly the investigation on the hot rolled coil complaint with a decision imposing definitive duties.

(1) OJ C 371, 1.12.1998.

(2) Doc. COM(1999) 453 final.