To protect producers from unfair competition, the European Union implements trade defence instruments (Trade Defense Instruments, or TDI) in accordance with the agreements of the World Trade Organisation, which are divided into:
- Anti-dumping measures
Customs duty or price obligation against unfair competition. Aimed at eliminating the damage caused by the enterprise's unfair competition (the export price is lower than the selling price of the corresponding product on the domestic market).
- Countervailing measures
Customs duty or price obligation against unfair competition. Aimed at eliminating damage caused by impermissible benefits (subsidies) provided by the state.
- Safeguards
A customs duty, a quota, or a combination of these, a tariff quota. It is applied to trade under conditions of fair competition, but only if the industry of the European Union is in a serious crisis and needs short-term, limited defence to continue functioning
The majority of complaints about dumping and impermissible subsidies are received from European Union producers in the following fields:
- Iron and steel products
- Electronics
- Fertilisers
- Textile products
Implementation of defence and the role of Estonia
European Union producers must submit a complaint to the European Commission with possible evidence of unfair competition or a crisis in order to implement safeguards.
The European Commission then initiates an investigation procedure and, based on the findings, makes a proposal to the member states on the imposition or non-imposition of measures.
The implementation of these measures, along with other aspects of foreign trade policy, falls under the jurisdiction of the European Commission's Trade Directorate, with member states playing only an advisory role. The European Commission has convened the Trade Defence Committee (TDC) and the Safeguards Committee (SGC) to consult with the member states.
During committee meetings, the European Commission updates member states on submitted complaints and investigation outcomes, seeking their input on the scope and format of potential measures. The decision on the introduction of a trade defence instrument is made by the European Commission, but the member states have the right to reject it by a qualified majority as usual.
Before joining the European Union, Estonia was one of the countries with the most liberal trade policy in the world and did not implement measures to defend the market. In order to ensure the least possible protectionism, Estonia carefully analyses the proposals of the European Commission in order to avoid the application of unjustified safeguards.
Last updated: 28.08.2023
