Ensuring implementation of trade defence measures

OLAF has an important role in investigating possible avoidance of EU trade defence measures. Such measures are introduced to protect the EU industry from unfair competition and usually consist of anti-dumping duties and anti-circumvention measures which are applied on a limited range of products at importation.

In this role, OLAF cooperates with Member Stats customs authorities, third country authorities and European trade associations. This enables OLAF to better analyse the import market and identify operators in the EU and in third countries who are not playing by the rules.

For this purpose, OLAF exchanges information and organises joint missions of administrative cooperation in third countries. OLAF’s investigators are confronted with a range of situations potentially leading to the evasion of EU trade defence measures. These includes misclassification of goods, undervaluation, trans-shipment of goods in an intermediate country and assembly or insufficient transformation for origin purposes.

OLAF is attentive to also protect the genuine and compliant producers in third countries who have legitimate expectations to trade in the EU without unjustified barriers.

OLAF analyses the situation country per country and raises the alarm in cases of non-cooperation by third countries which could indicate massive circumvention of the measures through their territory. Where cooperation is satisfactory, OLAF investigations allow the differentiation between genuine producers and those circumventing the measures.

OLAF has an ongoing cooperation with the European steel association, the European bicycles industry and the EU aluminium household foil industry to obtain technical expertise and information regarding possible circumvention measures adopted to protect their industries.

OLAF is cooperating with the aluminium household foil industry. For several years now, OLAF has carried out investigations regarding the evasion of anti-dumping and countervailing duties applicable on imports of aluminium household foil originating from China. It has been established, in close cooperation with the competent authorities in third countries in South East and Central Asia, that the origin of this product has systematically been misdescribed at import into the EU, resulting in the evasion of duties. Joint verifications at several Thai companies in late 2022 by OLAF and the competent authorities, confirmed insufficient production in Thailand as to confer aluminium foil the Thai origin, only being intended to avoid the payment of the applicable duties for goods originating from China.

A similar situation concerns the imports of stainless steel pipes declared upon import as originating from South Korea. This matter has been subjected to consecutive investigations by the Office, whereby in cooperation with the Korean Customs Services, it was established that the goods could not be considered of Korean origin, as they did not undergo any substantial processing in South Korea. This resulted in the evasion of a vast amount of anti-dumping duties applicable to these products when originating from China.

Stopping the steel… fraud – Cooperation in action

In 2019, sources tipped off OLAF about a suspicious consignment of steel on its way to an EU port. OLAF in turn alerted the relevant national authorities, and, as a result, customs officers met the consignment on the quayside when it arrived.

Following inspection by the customs authorities, it was confirmed that the steel was of an inferior quality than what was declared on the import documents and was therefore subjected to higher taxes (73.3% anti-dumping duties).

The import document also stated that the steel was coated in a paint that prevented rust and corrosion. However, following chemical analysis, this declaration turned out not to be true as only a simple layer of varnish had been applied to the steel.

Additional OLAF investigations managed to piece together a picture of the company that carried out the alleged fraud (such as its addresses). It transpired that the company had carried out alleged similar frauds across the EU. OLAF shared this information with relevant authorities in other Member States, which helped facilitate further investigations into the company and led to the discovery of a series of prior similar suspected fraudulent activities carried out by this company across the EU.

Based on this finding, OLAF concluded that the suspected company was involved in a possible active conspiracy with the goal of evading taxes for nearly €6.5 million, and reported the matter to the European Public Prosecutor’s Office.