Bloomberg News

EU Extends Levy on Construction Material From China to Malaysia

July 24, 2012

The European Union extended to Malaysia a tariff on a construction material from China, saying Chinese exporters used the country to evade the levy meant to curb competition for EU producers like Cie. de Saint-Gobain SA.

The EU said Chinese exporters of open-mesh fabrics of glass fibers shipped them to Europe via Malaysia to dodge the 62.9 percent duty. Open-mesh fabrics of glass fibers are used mainly as a reinforcement material in construction.

The import tax “was circumvented by trans-shipment from Malaysia,” the 27-nation EU said in a decision published today in the Official Journal. The extension, approved by EU governments in Brussels on July 16, will take effect tomorrow.

The EU imposed the trade protection in August 2011 for five years to help producers including Saint-Gobain Vertex sro -- now called Saint-Gobain Adfors CZ sro -- of the Czech Republic and Valmieras Stikla Skiedra AS (VSS1R) of Latvia counter below-cost, or “dumped,” imports from China. The 62.9 percent levy is the maximum of several rates, which depend on the Chinese exporter. The lowest levy is 48.4 percent.

Chinese exporters including Yuyao Mingda Fiberglass Co. and Grand Composite Group expanded their combined share of the EU market for open-mesh fabrics of glass fibers to 51 percent in the 12 months through March 2010 from 38.6 percent in 2006, the bloc said last year.

The extension of the maximum levy to Malaysia is the outcome of a circumvention probe that the EU began last November. That inquiry was requested by European producers, which also include Germany’s Vitrulan Technical Textiles GmbH and Hungary’s Tolnatex Fonalfeldolgozo es Muszakiszovet-gyarto Bt.

To contact the reporter on this story: Jonathan Stearns in Brussels at jstearns2@bloomberg.net

To contact the editor responsible for this story: James Hertling at jhertling@bloomberg.net


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