EU to elevate anti-dumping tariff on China-made bicycles

Taipei, May 24, 2005 (CENS)--The European Eunion (EU)'s steering committee recently issued an initial ruling on dumping charges against imports of bicycles made in mainland China, boosting the anti-dumping tariff rate for the imports from 30.6% to 48.5%.

EU is also considering to start a series of anti-dumping investigations on bicycle-parts makers in China.

The EU ruling surprised most Taiwanese and Chinese makers of bicycles and parts in mainland China, and many of them have started to adopt some countermeasures.

Industry sources said that the Chinese central government is expected to reject the ruling by threatening to adopt some retaliatory measures against Europe's higher-value exports to China.

Jeffrey Hsu , spokesman of Giant Manufacturing Co., Ltd., Taiwan's No. 1 bicycle maker that runs some plants in China, said that Giant has applied to EU's steering committee for a lower and special tariff rate on bike exports to Europe on grounds that the production/sales mode at its bike plant in Kunshan (Jiangsu Province, mainland China) is based on market economy rather than planned economy in socialist nations. Giant, however, has yet to get reply from EU.

Hsu added that if Giant fails to escape the 48.5% tariff rate on shipments to Europe, his company would consider to set up a bike-production plant in am eastern European country, or ship semi knock-down (SKD) parts to a contract-assembly partner in the region.

Industry insiders pointed out that some key bicycle parts made in China, including cranksets (chainwheels), derailleurs, and brake systems, are expected to face anti-dumping investigations in the next stage by the EU.

A ranking official of Lee Chi Enterprise Co., Ltd., a leading bike-parts maker in Taiwan with two plants in China, said that if EU extends its anti-dumping sanction into the bike-parts sector, Lee Chi would consider to ship the semi-finished parts products produced in mainland China plants back to Taiwan for final assembly and exports.

Industry sources said that the 30.6% anti-dumping tariff levied by EU on China-exported bicycles to Europe would expire in July after being effective for five years, and the EU steering committee will then make a decision on tariff rates.