China fibreglass to face higher EU tariffs

* EU to levy extra 43.6 percent import duty from September

* Possibility of longer-term measures being studied

BRUSSELS, Aug 27 (BestGrowthStock) – EU plans for a higher tax on
fibreglass imports from China look set to pass into law next
month despite concerns the tariffs will limit supply of the
lightweight material, used in wind turbines, cars and ships.

A proposal by the European Commission, the European Union’s
executive, to impose an extra 43.6 percent tariff from Sept. 16
won support from seven of the EU’s 27 states in a vote on
Thursday, with 12 opposed and 8 abstaining, EU diplomats told
Reuters.

Under EU law, an abstention counts as a vote in favour of a
proposal, resulting in a final tally of 15 for and 12 against.

The decision means import tarrifs on Chinese fibreglass are
now likely to rise from 7 percent to 50.6 percent.

The move follows complaints by European producers that
Chinese exporters were dumping fibreglass on the market at
illegally low prices, threatening jobs at producers such as PPG
Industries (PPG.N: ) and Saint-Gobain Vetrotex (OC.N: ).

European fibreglass users are opposed to the higher tariffs,
arguing that the duties will create supply shortages and raise
production costs for thousands of companies involved in turning
fibreglass into composites used in wind turbines, lightweight
hulls for ships and in cars.

EU diplomats opposing the measures said earlier this week
they expected Thursday’s vote to block the tax. [ID:nLDE67G1FW]

Abstentions by the Czech Republic and Belgium — tipping the
vote in favour of duties — were not expected and could now pave
the way for duties to stay in place for up to five years, one
diplomat said on Friday.

“It’s harder to get rid of an EU measure once it’s on the
statute books,” the diplomat told Reuters.

The Commission’s plans are for temporary measures. These
would take effect while an investigation into Chinese fibreglass
exports continues. Definitive five-year duties must be approved
by the 27-nation bloc and launched by March 2011.
(Reporting by Juliane von Reppert-Bismarck; Editing by Nina
Chestney)

China fibreglass to face higher EU tariffs