OTHER ISSUES

In addition to the above, FTA make also possible further improvement of legislation with regard to:

•  Competition

The proper legal regulation of issues related to competition is a direct consequence of FTA functioning in practice because the need for more transparent rules is greater.

•  Anti-Dumping provisions

Dumping practices relate to the situation where a product is temporarily sold below cost with the aim of driving out competition. This is a dishonest trading practice and that is why anti-dumpting provisions should take place.

•  Counter-balancing measures

In this framework, nothing “… can stop either side to undertake anti-dumping and counter-balancing measures”, in full compliance with Article VI of GATT, 1994 and also with the Agreement on Subsidies and Counter-Balancing Measures.

FTA also provide a range of choices for potential problems which may arise as a result of unjust interpretation of such agreements. Such misinterpretations may seriously hurt domestic producers. In such a case, the hurt side may undertake measures which comply with the indicated procedure in the agreement.

The damage caused to businesses is the main argument for the introduction of counter-balancing measures or anti-dumping. Indicators of such damage may be:

•  Lower levels of output, sales, profits or market share;

•  Price decrease in the domestic market;

•  Real evidence on/or potential decrease of wages, employment, inventories, etc.

If a certain practice is not compliant with the principles which make possible honet competition, and if such a practice causes either damage or discrimination, the hurt side may introduce those measures which it sees fit. F.eg. if there are such practices as.

•  Subsidising;

•  Dumping;

•  Faking of products; or

•  Dishonest competition,

Which lead to material damage, the first step is notifying the Joint Committee. If no solution comes from the Committee, the next step is investigation which will be carried out from

the Anti-Dumping Department at the Ministry of Economy. But, to get such investigation started, an intitial petition is needed first from affected industries. Where petition is accepted the counter-balancing or anti-dumping measures are taken. For the petition to be valid, at least 25% of the affected industry should sign it.

It should be emphasised that in order to see whether the proposed measures are (or are not) well argumented, there is an investigation of the causal link between dishonest trade practices and the material damage inflicted. F.eg. if the following are the reasons:

•  Contracting of demand and change of consumer model;

•  Technological breakthrough and increased productivity,

Then, tariffs are not justified and the case is lost !

•  By the same line of reasoning, in the case of subsidies, the application for counter-balancing measures is not accepted if:

•  Such subsidising accounts for less than 2% of the export price towards developing countries,

•  Subsidised import volumes or the damage inflicted are negligable for developing countries