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Russia files first WTO dispute over EU energy policy

Published time: December 23, 2013 14:33
Reuters / Maxim Shemetov

Reuters / Maxim Shemetov

Moscow has filed its first case with the World Trade Organization against the European Union, saying it was unfairly charging Russian companies hundreds of millions of dollars for allegedly reducing energy prices in global markets.

The request for formal consultations is the first step in the WTO's dispute settlement mechanism, Interfax reports on Monday.

Under the WTO rules, the consultations must take place within 60 days from the date of the application, which means it’ll most likely to kick off immediately after the New Year holidays.

"The EU's unfair dumping practices were the discussion topic at numerous expert consultations, at virtually every high-level meeting, at EU courts, but it never led to a change in the position of our main trading partner. In circumstances when other means of settling the issue have been exhausted, appeal to WTO procedures is a forced, but necessary measure for restoring normal trade terms with the EU," Interfax quotes its source as saying.

Dumping is a term used to describe the trading practice when goods are sold abroad below the average price on the exporter’s domestic market. If such dumping is proved to harm the industry of the importer, special protectionist measures like higher import tariffs may be imposed.

The EU has been applying so–called energy adjustments on Russian companies accusing them of dumping. However, Russia says the block didn’t take into account prices on the domestic market, as required by international trade law.

Even though Russia achieved the status of a market economy in 2002, the EU has kept on viewing it as a country with a non-market economy, and determined whether dumping had occurred by comparing the price of Russian exports with prices on the domestic markets in third countries.

This approach hurt Russian exporters and, from Russia's standpoint, violated EU commitments under the 1994 EU-Russia partnership and cooperation agreement. Under that agreement, the EU was to apply anti-dumping measures in accordance with the requirements of GATT and take into account Russia's natural competitive advantages, including access to cheap feedstock.

Overall, the EU initiated 17 anti-dumping cases against Russia between 1995 and 2012, according to the Economic Development Ministry, in Russia's view the majority of them against international law. As a result, producers of Russian fertilizer alloyed steel, cables, pipes, and various other steel products and aluminum foil suffered damages amounting to hundreds of millions of dollars, the ministry said.

Comments (3)

 

suricaten 25.12.2013 16:07

If the EU thiks that it's smart to impose both ifavourable and bad mouthing Russia? Then they must be either under preassure from some one else, and I think we know Who!
Or they must in their clouded minds, think their (printing money activity), with that massive debt is a smart thing???
Because all indicators and expertise on Russia's business potential are massive! Have to wonder if the EU/US are plain stupid in their attempts to hurt Russia in every possible way! But US/EU--> You aregoing to loose!

 

suricaten 25.12.2013 15:59

I find it strange and a bit suspicious to the EU accusations on dumping, or selling ata higher price abroad, than domestic market! But then I ask, why is the US, that now are sellingsuch commodities on the world-market, they have subsidised the price on gasoline and other commodities for years! But no one even mention it! When and if the EU set some rules for some country, they in the name of fair and trade on equal terms, have the same rules for all!

 

Colin Shorey 24.12.2013 06:52

Some one is making a lot of money by wasting my money

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