EU 'to extend anti-dumping duties' on Chinese shoes

(BRUSSELS) - The European Union is to extend anti-dumping tariffs on shoes from China and Vietnam into next year, an EU source said Monday.

The anti-dumping measures were introduced in 2006 to combat an influx of leather shoes into Europe from the two Asian countries that Brussels said unfairly benefited from state aid.

The measure has been strongly attacked in Asia and, at the time they were imposed, the tariffs were supported by the smallest majority of EU states, with 13 of the 25 nations in favour.

The tariffs were originally imposed for two years and were due to expire next month.

Now, the source close to the dossier said, they will be extended into 2009 or beyond.

The EU anti-dumping measures involve import duties of 16.5 percent on Chinese shoes with leather uppers and 10 percent on the same kind of shoes from Vietnam.

The step provoked strong opposition from Chinese shoemakers and the government in Beijing, which said the measures did not conform with EU and World Trade Organization regulations.

Asked about the possibility of a tariff extension, a spokesman for EU Trade Commissioner Peter Mandelson refused to comment.

However a report in the London Sunday Times cited a senior official working in Mandelson's department as saying that the commission would call for an expiry review when the current tariff period ends next month.

That would in effect extend the tariff period for a year or more after Mandelson tells his fellow commissioners about his decision this week, said the official, who was speaking to reporters posing as industry lobbyists.

The original two-year tariff period was a compromise to get the measures passed after the European Commission had proposed a five-year penalty.

The main vote faultline ran between Europe's economically liberal north, hostile in principle to anti-dumping measures, and the more protectionist south, sympathetic to the views of EU producers.

The tariffs were imposed after a commission investigation found that shoemakers in China and Vietnam unfairly benefited from state aid in the form of soft loans, tax breaks and cheap rents.