ABSTRACT
This chapter analyzes the China–European Union (EU) trade disputes pertinent to the non-market economy (NME) treatment to explain the limits of the legal approach to address such commercial tension. It discusses the NME treatments of China under the EU anti-dumping regime, which could provide the legal background for further discussion. Concurrent imposition of anti-dumping and countervailing duty is a relatively new problem for the Chinese firms. The Regulation 459/68 was the European Economic Community's first regulation on anti-dumping providing that strict comparison of the domestic price does not apply to the country, where government can strongly intervene on domestic price. The EU has criticized the creditability of the domestic price in China and therefore maintained its NME status. In response to the “2016 deadline,” when China was not presumably treated as an NME, the EU created the concept of “country of significant distortions” to cover the NMEs with World Trade Organization membership.
