For ceramic tableware and kitchenware products currently en route to the EU from China, it is important that importers are aware they will be charged anti dumping duty at 58.8% on the full customs value of the shipment, unless they take steps immediately to ensure they are able to claim a lower rate when the shipment arrives.  This will require cooperation from the supplier, which we can help to manage through our Hong Kong alliance.  If you have shipments on the way and need help to ensure that you don’t pay any more anti dumping duty than absolutely necessary, please get in touch – we can help.

Following on from the immediate issues of dealing with shipments currently on the water, the imposition of anti dumping duty on ceramic tableware and kitchenware from China has sharpened the focus of many importers on customs duty planning.  This is where a detailed analysis of the supply chain can often result in a restructuring of certain elements, in such a way that reduces the final duty cost on import into the EU. 

Customs duty planning involves close examination of the product itself, its value build-up and its origin, in order that the end result becomes the lowest possible duty payment.  Done correctly, we ensure that such planning is also compliant with Customs legislation, including ADD measures.  We are currently working on one case where we expect to reduce the value on which customs duty is charged by almost 40% - this will eliminate the effect of 58.8% ADD on current pricing!  Another client is restructuring certain elements of his manufacturing process, which will not only eliminate ADD, but it also reduces other supply chain costs. 

For any suppliers whose products are subject to 58.8% ADD, this is the time to implement effective customs duty planning, so that a robust case can be made for review when the current provisional ADD measure becomes definitive, expected to be 16 May 2013.  Importers buying from these suppliers should be putting pressure on them to undertake customs duty planning now, with a view to applying for a reduced individual ADD rate next May.

For many businesses, there will still be an increase in total duty costs, for a wide range of reasons which might prevent efficient customs duty planning.  This means a substantial increase in physical payments at point of import.  For those importers using deferment accounts, it is likely they will need to increase their deferment guarantee, which could also increase restrictions imposed by the banks on working capital.  Importers who don’t currently have a deferment account should consider getting one – it means you don’t have to find immediate cash to have your goods cleared through Customs.  If you are having difficulty in increasing your deferment guarantee, or even in getting one in the first place then come and talk to us – we have an alternative solution.

Every supply chain is different, so there is no “one size fits all” solution that everybody can just plug in.  Call us for an independent consultation, on 01635 521624, or email to ian.worth@thecustomspractice.com.

The European Commission has today (15 November) published a Regulation 1072/2012 imposing provisional ADD on imports of ceramic tableware and kitchenware from China, wef tomorrow. Rates of ADD range from 17.6% to 31.2% for specific named companies; 26.6% for 386 co-operating companies (all named in the Regulation), and 58.8% for all other companies in China not specifically named in the Regulation.

The Commission has imposed provisional ADD, despite a majority vote against imposition by the Commission's Anti Dumping advisory committee.

This means a significant increase in cost for EU importers, unless viable alternative sources can be found. The chances of a reversal of the decision may depend on the strength of lobbying activity over the next few months, however, given the Commission's willingness to ignore the vote of its own advisory committee, we should expect ADD to become definitive in 6 months time.

http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2012:318:0028:0065:EN:PDF

This link is to the Regulation, however, I am aware that many outside the EU will be unable to access, so if anybody needs confirmation of the ADD rate for a specific company please contact me at ian.worth@thecustomspractice.com.

The following message has just been received by The Customs Practice from the British Retail Consortium, and is consistent with information we have received from other sources…

You have probably heard lots of rumours about this case over the last week or so, but I have now heard from a number of reliable sources that the Commission will impose provisional anti-dumping duties on imports of ceramic tableware and kitchenware from China.  The deadline for the imposition of duties is 16 November. The measures will be published in the
Official Journal no later than 15 November.

The information in the OJ will also include the list of companies that will receive individual duty rates, together with the relevant
rate for each company.

This is obviously deeply disappointing news, particularly as a majority of EU member states voted against the Commission’s
proposal.  It is also frustrating that the Commission refused to reveal its intentions until 3 days before the deadline for the imposition of the duties.

This is not the end of the story.  The Commission will continue with its investigation and will need to make recommendations next year on “definitive” measures for this case.  The BRC will remain active in lobbying against measures, and we shall focus our efforts on making sure that the majority of member states who voted against the measure at the provisional stage do so again at the definitive stage, when their decision will be binding upon the Commission.

What can be done now?

We strongly recommend that all importers should contact their suppliers in China and establish what rate of ADD will apply. 

Any supplier whose goods will be subject to the countrywide rate (58.8%) or to the co-operating exporter rate (26.6%), in other words any supplier who does not have an individual rate, has not had his pricing structure investigated and therefore may be subject to a disproportionately high rate of ADD.  Similarly, new suppliers who were not eligible to participate in the initial investigation will be subject to the countrywide rate, without having had any opportunity to demonstrate the extent to which their own pricing structure may be defensible against dumping allegations.

The opportunity for these suppliers to request an individual review will arise when definitive ADD is imposed, expected to be in May 2013, however, the preparation for submission of well-argued requests for review should start as soon as possible, in order that they have the best possible chance of securing ADD rates lower than the default rates. 

We can help your suppliers to construct a comprehensive and fully supported application for review, but we need you to point your suppliers in our direction.

At the time of writing, the Commission has still not published the necessary regulation to impose provisional ADD, but we will advise further when this happens.  If you have any questions please contact us on 01635 521 624 or by email to ian.worth@thecustomspractice.com.

Further to our earlier news items on 3 and 8 October, we can now report that the European Commission has today (14 November) published a regulation which suspends the duty rates on import to the EU for a range of products originating in Pakistan. The measure takes effect from tomorrow (15 November) and will remain in force until 31st December 2013, at which time it will be decided whether to terminate the suspension, or to continue it.

This means that products including certain yarns, fabrics and textile garments will be free of customs duty, providing they meet specific origin criteria.  Other products, including undenatured ethyl alcohol, certain articles of leather and other yarns, fabrics, garments and footwear will also be free of duty but subject to quota limits.

Importers wishing to check whether their imports may be eligible for this duty suspension can contact us on 01635 521 624, or by email to ian.worth@thecustomspractice.com.