LEVA-EU has responded to the European Commissions’ General Final Disclosure Document regarding e-Bike anti-dumping duties, claiming that the Commission has “totally failed” to establish injury to EU producers.
While the final decision has yet to be made, the Commission has now disclosed its intention to impose duties on electric bikes from the territory, following an anti-dumping investigation initiated in October 2017, originally launched thanks to a complaint from the European Bicycle Manufacturers Association(EBMA) lodged in September 2017.
LEVA says that this is not a case of dumping because “injury” is one of three essential conditions to impose duties, and EU producers are proven healthy by economic performance indicators established by the commission.
Figures reported in LEVA’s response indicate that sales volume, production volume and production capacity are all up at least 20%, while return on investment is up 103%.
LEVA commented on the figures: “The only extremely weak argument for the Commission to claim injury is the fact that the industry profitability was 3.4% in the investigation period (Sept. ’16 – Sept. 17), whilst the Commission feels it should be 4.3% as in 2015.
“Thus, to crank up the profitability of a small group of EU ‘manufacturers’ with 0.9%, the Commission believes it is necessary to hit an estimated 150 European SME’s with up to 79.3%.”
In May, the EBMA made a request to the Commission for the registration of imports, meaning that European importers were faced with the potential of retroactive collection of duties, between 4 May and 19 July 2018.
The Collective of European Importers of Electric Bicycles, backed by LEVA, estimated that injury amounted to an average of €605,000 per company, and based on an assumption of around 150 importing companies in Europe, that would mean that the total injury caused by the proceedings alone already amounted to more than €90 million.
The EBMA withdrew its request without comment, and it is unclear whether there is a link between the collective’s statement and the EBMA’s decision.
Regarding this point, LEVA commented: “Since this happened right in the middle of the e-bike season, virtually all companies had containers on the water. Should these imports have been hit with 189% retroactive collection most of the importers, if not all, would have gone bankrupt. This forced the SME’s to turn their supply chain upside down overnight.
“Moving assembly out of China and setting it up elsewhere, moving the component supplies, losing customers, annulling contracts, dismissing staff, increasing prices, … Based on the importers’ injury reports, LEVA-EU calculated total costs involved in all this at €90 to €100 million.”
The trade association also believes that the Commission is ignoring importers, and has on several occasions “breached their right to defence.”
LEVA said in its statement: “The proceedings have had a huge adverse effect on all importers, an effect beyond repair. The provisional duties, if collected, will have a further damaging impact on these same importers. Final duties will have an immensely negative effect on the whole European e-bike sector. The offer and competition will shrink, innovation will be hampered, prices will go up and the net result will be a product that is a lot less attractive to the consumer.
“Instead of switching from unsustainable means of transport to electric bicycles, they will continue to use ICE vehicles. What’s worse however is that dumping duties risk to almost automatically lead to anti-circumvention duties, which will be catastrophic for the whole business.”
In a previous statement, the EBMA applauded the Commission’s judgements: “The Commission’s investigations have now proven the existence of dumping, subsidies and injury to European e-bike manufacturers, as Chinese e-bikes have flooded the EU at an alarming rate and artificially low prices.
“The concealed costs of Chinese e-bikes and the injury to European industry and jobs are now revealed. Definitive trade defence measures will shield 90,000 EU workers and over 800 SMEs against unfair competition from China.”