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WTO office notifies China of towel probe

Taiwan has notified China of its decision to initiate an anti-dumping investigation on towel imports from China, Taiwan's representative to the WTO Lin Yi-fu (林義夫) said on Wednesday.

Lin said the information was conveyed to the Chinese mission to the WTO in a verbal note a few days ago and that his office has not received any response so far.

The case is the first investigation on dumping involving Chinese products since Taiwan joined the WTO in 2002.

If the investigation proceeds smoothly, Taiwan might impose a temporary anti-dumping duty on China-exported towels in late June and levy the anti-dumping duty on the products in September.

WTO experts said that in the course of the investigation, it is crucial for Taiwan to first determine whether China is a "market economy" or "non-market economy" because this can affect the outcome of the investigation.

While China has been seeking international recognition of its status as a "market economy," WTO member states differ on the issue, with the US and EU defining China as a "non-market economy" and Brazil recently recognizing it as a "market economy," they said.

In an anti-dumping investigation, if the exporting country is a market economy, the market prices of the products in question in the exporting country will be the main basis of comparison. If the exporter is a non-market economy, the market prices of a third country will be cited as a substitute for that of the exporting country, they said.
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