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EU Extends Levy on China Building Material to Thailand

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Jan. 16 (Bloomberg) -- The European Union extended to Taiwan and Thailand a tariff on a construction material from China, saying Chinese exporters used the two nations to evade the levy meant to aid EU producers such as France’s Cie. de Saint-Gobain SA.

The EU said Chinese exporters of open-mesh fabrics of glass fibers, used mainly as a reinforcement material in construction, shipped them to Europe via Taiwan and Thailand to dodge the 62.9 percent duty. This is the second extension of the levy to prevent Chinese circumvention after the EU applied the measure last July to Malaysia.

The import tax “was circumvented by trans-shipment via Taiwan and Thailand,” the 27-nation EU said in a decision published today in the Official Journal. The extension, approved by EU governments in Brussels on Jan. 10, 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 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 in 2011.

The extension of the maximum levy to Taiwan and Thailand is the outcome of a circumvention probe the EU began in May 2012 and will apply retroactively to imports as of that time, when the bloc also began to register shipments of open-mesh fabrics of glass fibers from the two nations. The circumvention inquiry was requested by European producers, which also include Vitrulan Technical Textiles GmbH and Hungary’s Tolnatex Fonalfeldolgozo es Muszakiszovet-gyarto Bt.

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

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

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