EU fraud squad lauds results of 8-year Chinese imports probe
(BRUSSELS) - European Union anti-fraud investigators hailed Thursday the conclusion of an eight-year global probe into duty evasion on Chinese tube and pipe fittings.
The European Anti-Fraud Office (OLAF) said 9.0 million euros ($12 million) in import duties had been recovered with cases in Britain and Germany resulting in jail sentences, fines and out-of-court settlements.
Despite a long history of trade disputes covering everything from prized rare earths or modems to fake cigarettes or jeans, an OLAF official stressed that in most cases, customs breaches were by European importers and that "most Chinese companies are behaving legitimately."
The official said: "European operators are manipulating legitimate trade -- the offence is invariably within the EU."
"It is important that fraud is not only investigated but also prosecuted," said OLAF director general Giovanni Kessler of the case first launched in 2004 and which resulted in convictions at the end of last year.
Officials said "millions more" in duties stemming from this case alone were still flowing in.
An English court in December sentenced John Sutton to two years after Wigan-based firm Ashby Scott Ltd was identified as a distribution hub for these plumbing or engineering products, a British Treasury official said.
Another British importer settled out of court for a million pounds (1.2 million euros) in unpaid duty and penalties. The official said a confidentiality clause meant the individual could not be named.
A German court in Essen, near the big European North Sea port hubs of Rotterdam and Antwerp, in November hit another company owner with a suspended jail term and a 450,000-euro penalty.
OLAF officials said ongoing German court proceedings to recover the fine meant this individual could not be named either.
The trail for the pipes and tubes saw fake certificates of origin slapped on containers carrying Chinese goods from Taiwan or India
OLAF said that of 18 million containers shipped into the European Union each year -- one in three moved globally -- 10,000 on average are subject to fraud probes.
No containers are opened at ports by OLAF -- its investigators focus on paper trails surrounding goods already in commercial circulation in Europe, and said they "do not touch a case unless it's worth a million."
"Ninety-nine percent" of those probes centre on Chinese goods -- recent years have seen a multitude of anti-dumping subsidy problems over exports of metal fasteners or potato starch, for example.
For 2010, the latest full-year figures, OLAF investigated 139 million euros-worth of suspected duty fraud.
"We cooperate well with Chinese customs, the big problem we still face here is big variations in terms of the penalties imposed by the courts in different European countries," the OLAF investigator underlined.
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