For essential bicycle parts originating in China, an anti-dumping duty of 48.5 % has been in place for many years. The legislator introduced this extension of the anti-dumping duty regime to bicycles originating in China order to counter circumvention in the form of shipments of bicycle kits. However, under Regulation (EU) No 88/97, there are also possibilities for exemption, provided that these parts are imported into the EU and used to manufacture a bicycle in which the Chinese value content does not exceed 60 %, or the value added through assembly amounts to 25 %. Furthermore, there is an exemption for smaller businesses importing fewer than 300 parts per month. Both exemptions are subject to authorisation and to fairly complex conditions.
To date, the EU has not imposed any anti-dumping duties on key bicycle parts for e-bikes, even though even higher anti-dumping duties apply to imports of e-bikes themselves. On the contrary: Regulation (EU) No 88/97 provides that the anti-dumping duty does not apply if an e-bike is manufactured from the essential bicycle parts, Article 14d of Regulation (EU) No 88/97.
This could now change in customs practice following a recent judgment by the General Court (European Court of First Instance): the General Court was called upon to rule on a question referred by a Belgian court as to whether imports of such parts, which are intended for a specific e-bike assembly project and which, taken together, constitute the essential parts of one or more e-bikes, be regarded as a ‘disassembled’ complete e-bike upon import, even if they are only to be assembled within the EU and – notably – if the parts were imported from different suppliers over a period of several months for a specific importer. In the event that the parts are to be regarded as a ‘disassembled’ e-bike and declared as such, an anti-dumping duty of up to approximately 70 per cent – depending on the supplier – applies. The General Court affirmed this and based its decision on a broad interpretation of General Rule 2(a) of the CN, according to which a disassembled product is to be regarded as an assembled product provided that the parts are put together, whilst accepting that the individual parts were imported over a period of several months and from different suppliers. In doing so, it referred to the findings of fact in the decision, namely that the import documents, invoices, etc. indicated that the imports were associated with a specific assembly project.
With this very broad interpretation, the decision contradicts the legislative decision not to impose anti-dumping duties on e-bike parts. These parts are expressly exempt from anti-dumping duties under Article 14d of the aforementioned Regulation (EU) No 88/97. Furthermore, the decision contradicts the Additional Notes in Chapters XVI and XVII of the Combined Nomenclature, which permit the treatment of split consignments only for certain machinery and equipment at the request of the declarant. This is not provided for in the case of e-bikes. Ultimately, the decision negates any possibility of exemption for an assembly process or for smaller businesses in the EU, as provided for in Regulation (EU) No 88/97 regarding anti-dumping duties on essential bicycle parts. It also remains unclear whether the duty applies even if not all parts, but only individual parts, originate from China. As the judgment does not address this question at all, this too must remain unresolved. It is to be hoped that an appeal will be lodged against the decision.
Should the decision become final, e-bike manufacturers will in future have to accept that parts purchased for a specific assembly project will be regarded as a ‘disassembled’ e-bike, even if the necessary parts are imported over a period of several months and from several suppliers. In that case, anti-dumping duties would also apply to the parts, just as if e-bikes had been imported from China. This would be a devastating outcome for the e-bike industry in the EU, and affected companies should take steps to counter it. It must be ensured that no false declarations are made. Consideration should even be given to implementing risk diversification measures in such cases, such as allocating imports for larger assembly projects to separate project companies. However, the trade associations are certainly also called upon to take action here, so that the EU legislature, the European Commission, establishes rules of interpretation that provide clarity in this uncertain legal situation.
We would be happy to advise you on the application of this decision in individual cases.
