An African Continental Investigating Authority: a Possible Solution for Conflicting Anti-Dumping Regimes and Overlapping Regional Trade Agreements

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An African Continental Investigating

Authority: a Possible Solution for

Conflicting Anti-Dumping Regimes and

Overlapping Regional Trade Agreements

Faculty of Law

University of Amsterdam

Master’s Thesis

Michele Giovanni Leone Bellora

michele.bellora@outlook.it

12894656

LL.M International Trade and Investment Law

Thesis Supervisor: Kornel Olsthoorn

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Abstract

Regional Trade Agreements and anti-dumping measures are two important exceptions to, respectively, the multilateral trading system and bound tariffs. This thesis focuses on the interaction between these two exceptions with respect to the African Continent. The necessity and possibility of African states to depart from the multilateral trading system has resulted in an incredible amount of Regional Trade Agreements (RTAs) which have generated an issue of overlapping membership. At the same time, anti-dumping measures have been used by states as economic policy tools. This has led to the proliferation of RTAs with different and potentially conflicting anti-dumping regimes and regional investigating authorities.. The African Union has recently adopted the African Continental Free Trade Area (AfCFTA) as a way to boost the continental economic integration process. It also aims at solving the issues related to overlapping memberships of different RTAs. However, the AfCFTA does not satisfactorily address the issue of different and conflicting anti-dumping regimes. On inspiration from the Tripartite Free Trade Area, which is not in force, an African continental investigating authority for trade remedies is proposed as a potential solution.

Keywords

Regional Trade Agreements – Anti-Dumping – African Continental Free Trade Area – Overlapping Membership – Investigating Authority – Economic Integration

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List of Abbreviations

ADA – Anti-dumping Agreement

AEC – African Economic Community

AfCFTA – African Continental Free Trade Area

AU – African Union

BOTC – Botswana Trade Commission

COMESA – Common Market for Eastern and Southern Africa

CU – Customs Union

EAC – East African Community

EALA – East African Legislative Assembly

EU – European Union

FTA – Free Trade Area

GATT – General Agreement on Tariff and Trade

ITAC – International Trade Administration Commission

MFN – Most Favoured Nation

OAU – Organization of African Unity

REC – Regional Economic Community

RTA – Regional Trade Agreement

SACU – Southern African Customs Union

SADC – Southern African Development Community

TFTA – Tripartite Free Trade Area

USA – United States of America

USD – United States Dollars

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Introduction

On the 30th of May 2019, the African Continental Free Trade Area (AfCFTA), came into force. It is

considered to be the largest preferential trade agreement in terms of participating member states which has to date been communicated to the WTO. The AfCFTA is considered to be a landmark achievement for the future of African continental integration.1 As flagship project of the African

Union Agenda 2063, it is a milestone for Africa’s continental integration.2

Notwithstanding the thrill behind this newly born Continental Free Trade Area, intra-African trade is almost inexistent. In the period between 2015 and 2017 intra-African trade, which is defined as the average of intra-African exports and imports, was around 15% of the whole African trade, compared to 47% in America, 61% in Asia and 67% in Europe.3 Despite this figure being so small, it is

interesting to consider that, Africa and Asia are the only continents with increasing trends in intra-regional trade since 2008.4 It is not guaranteed that this new trade agreement will automatically

generate more trade. However, the chances of success are enhanced by the broad political support. 5

It is considered that this will increase the opportunities of agreeing on more effective, accessible and transparent rules.6 The objective of the AfCFTA is to create a single continental market therefore

implying the progressive elimination of trade barriers.7 Once fully operative, the AfCFTA is expected

to boost intra-African trade by 33%.8 This will result in additional intra-African investments and new

market opportunities to foster Africa’s industrialization process.

Alongside the progressive elimination of tariffs and the consequent increase in trade, the domestic industries of individual African states, will increasingly be put in direct competition with other African industries. As important elements of trade policy, anti-dumping duties, if applied consistently with the WTO framework, are considered a legal form of protection towards the domestic industry from foreign competition.9 Despite their importance, as of today, only South Africa and Egypt have

1 UNCTAD, Economic Development in Africa Report 2019: Made in Africa – Rules of Origin for Enhanced Intra-African

Trade (UNCTAD/ALDC/AFRICA/19, United Nations Publications, 2019) 15.

2 African Union, ‘Flagship Projects of Agenda 2063’ < https://au.int/en/agenda2063/flagship-projects> accessed 18 July

2020.

3 UNCTAD, Economic Development in Africa Report 2019: Made in Africa – Rules of Origin for Enhanced Intra-African

Trade (UNCTAD/ALDC/AFRICA/19, United Nations Publications, 2019) 20.

4 Ibid.

5 Trudi Hartzenberg, ‘The African Continental Free Trade Agreement – What is Expected of LDCs in Terms of Trade

Liberalization?’ (United Nations LDC Portal) < https://www.un.org/ldcportal/afcfta-what-is-expected-of-ldcs-in-terms-of-trade-liberalisation-by-trudi-hartzenberg/> accessed 18 July 2020.

6 Ibid.

7 African Union, Agreement Establishing the African Continental Free Trade Area (Kigali 21 March 2018), entered into

force 30 May 2019, Article 3.

8 UNCTAD, ‘Press Release – Facts and Figures’ (UNCTAD/PRESS/IN/2019/2/Rev.1, 26 June 2019)

<https://unctad.org/en/pages/PressRelease.aspx?OriginalVersionID=520> accessed 18 July 2020.

9 Jean-Francois Bellis and Philippe de Baere, Business Guide to Trade Remedies in the European Community:

Anti-Dumping, Countervailing and Safeguards Legislation, Practices and Procedures (ITC(09)/B982 International Trade

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reported the use of anti-dumping duties to the WTO. The reasons may be attributed to the inexistence of national legal and institutional frameworks, elevated costs of investigations and lack of awareness in local producers or political factors.10 However, even assuming that African states will be able to

use such trade instruments, some issues might arise due to different overlapping rules.

Even though being the only one having a “continental scope”, the AfCFTA, adds to the African “spaghetti bowl” of Regional Trade Agreements (RTAs). Such a term was intended to represent the incredible amount of overlapping memberships existing in the different African RTAs.11 Out of fifty

one African states, only six have a single RTA membership, while the remaining have a double or triple one.12 Due to its ambitious scope, wide political support and territorial reach, an issue arises

regarding overlaps with other RTAs. This is especially the case with anti-dumping measures, as each African RTA, may take a different approach with regards to their use. The AfCFTA, which aims at solving the issue of overlapping membership between different RTAs,13 considers eight different

African RTAs as building blocks for its development.14 The continuity given to this eight RTAs, and

a lack of clarity on the use of dumping rules, could result either in a protectionist use of anti-dumping measures or in a lack of use of this instruments, which in both ways could be detrimental to African economic integration.

This thesis aims to answer the following question: “How should, the different anti-dumping regimes,

existing under the African Regional Economic Communities, and the one existing under the African Continental Free Trade Area, coexist to allow further economic integration?”

In order to provide an answer, the first part of this thesis will have two different purposes. Firstly, it will be explained how WTO Members can depart from the multilateral trading in order to achieve a deeper economic integration. Secondly, a paragraph will explain the economic policy rationale behind the use of anti-dumping measures in relation to African States. This part of the thesis will be descriptive, the GATT 1994 will be considered, and a brief literature review will be made regarding the purpose of anti-dumping rules.

The second part of this thesis will provide for a categorization and comparison of the different anti-dumping regimes present in the different African RTAs. A first paragraph will highlight the conceptually complicated relationship between regional trade agreements and the use of

anti-10 Illy Ousseni, ‘African Countries and the Challenges of Trade Remedy Mechanisms within the WTO’ (2016) Society

of International Economic Law, Fifth Biennial Global Conference Working Paper 2016/03 < https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2799553> accessed 18 July 2020, 8-12.

11 Jagdish Bhagwati, ‘US Trade Policy: The infatuation with FTAs’ (1995) Columbia University, Department of

Economics Discussion Papers 726 <https://academiccommons.columbia.edu/doi/10.7916/D8CN7BFM> accessed 18 July 2020, 4.

12 James Thuo Gathii, African Regional Trade Agreements as Legal Regimes (Cambridge University Press 2011) 65. 13 African Union, Agreement Establishing the African Continental Free Trade Area (Kigali 21 March 2018), entered into

force 30 May 2019, Article 3(h).

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dumping duties. This part will introduce a categorization of the different choices made by the African States when negotiating their RTAs. Secondly, the approaches to anti-dumping regulation made by the Eastern African Community, the South African Development Community, the South African Custom Union and the Common Market for Eastern and Southern Africa will be analysed and compared. In order for this analysis to be possible, the founding documents of the different RTAs, the relevant Annexes and Protocols, the WTO Trade Reports and the few existing case law will be considered.

The third part of this thesis will explain how the AfCFTA is attempting to resolve this issue. In order to do so, the AfCFTA Agreement will be considered, and any shortcoming will be exposed. This part will also introduce the Tripartite Free Trade Area (TFTA), which despite not being in force, it provides for a more supra national solution to the use of anti-dumping measures between RTA partners. A conclusive paragraph will suggest a possible solution for the AfCFTA in order to allow for an efficient, transparent and successful use of anti-dumping measures.

For matters of length, the scope of this thesis is restricted to anti-dumping measures and not to the whole trade remedies spectrum. In addition, being South Africa, Kenya and Egypt the most advanced African states in the use of trade remedies, only the RTAs to which they are parties will be taken into account, namely the: Southern African Customs Union (SACU), Southern African Development Community (SADC), Eastern African Community (EAC), and Common Market for Eastern and Southern Africa (COMESA).

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Part 1 WTO Regional Trade Exceptions

When WTO Members wish to enhance economic integration with other countries, “regional trade exceptions” allow them to adopt measures that would otherwise be WTO-inconsistent.15 Originally,

RTAs were understood as economic integration efforts between adjacent countries or countries in the same region.16 The main reason for creating such regional agreements is that members are more

willing to offer each other a more favourable treatment in trade than they offer to other trading partners. 17 At a regional level it is possible to achieve a degree of trade liberalization which might

not be possible at a global level.18 Regional trade exceptions have been accepted following the

rationale that trade liberalization will stimulate economic growth in the region, which can, in turn

generate more trade “as a block” with the rest of the world.19 This is particularly the case of Africa

where there are many small and land-locked countries which don’t have a solid enough market and infrastructural base on which to construct economic growth and industrialization.20 Another

perspective could also be less economical and more political; for example, the EU wanted to create “an even closer union” to avoid the recurrence of war; COMESA and SADC, inter alia, were intended to support and facilitate the participation of its member states in the WTO.21

Article XXIV GATT 1994 allows WTO members to derogate from the Most-Favoured Nation principle (MFN). 22 Under this provision, WTO Members may choose to grant each other a

preferential treatment in trade, which would have not resulted at a multilateral level. WTO Members have two options to establish a regional trade agreement: they can create either a custom union or a free trade area.23 A custom union is considered an agreement between two or more WTO Members

to create a single custom territory in replacement of their single ones.24 The requirement to be satisfied

is that all custom duties and other regulations of commerce must be eliminated with respect to “substantially all trade” between the members of the custom union, in particular for products

15 Peter Van den Bossche and Werner Zdouc, The Law and Policy of the World Trade Organization: Text, Cases and

Materials (4th Edition, Cambridge University Press 2017) 672. 16 Ibid.

17 Ibid 674. 18 Ibid 19 Ibid.

20 Gerhard Erasmus, ‘What happens to the RECs once the AfCFTA is in force?’ (TralacBlog, 17 May 2019) <

https://www.tralac.org/blog/article/14051-what-happens-to-the-recs-once-the-afcfta-is-in-force.html> accessed on 18 July 2020.

21 Peter Van den Bossche and Werner Zdouc, The Law and Policy of the World Trade Organization: Text, Cases and

Materials (4th Edition, Cambridge University Press 2017) 675.

22 World Trade Organization, General Agreement on Tariffs and Trade (Marrakesh 15 April 1994) 1867 U.N.T.S. 187

entered into force 1 January 1995, Article XXIV.

23 Ibid Article XXIV:8. 24 Ibid XXIV:8(a).

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originating from inside the union.25 The requirement vis-à-vis third parties is for each member to

apply the common agreed duties, and other regulations of commerce.26 A free trade area instead shall

amount to a group of two or more custom territories, which have chosen to eliminate trade duties on substantially all trade between them with respect to products originating within the Free Trade Area. With respect to trade relationship with third countries there isn’t any requirement.27 In any case, the

creation of a custom union, or a free trade area cannot result in higher or more restrictive duties or barriers than the ones which were applied prior to the formation of the regional trade agreement.28

An easier way in which WTO Members can accord preferential treatment to each other is through the Enabling Clause.29 This solution was designed in order to allow developing countries to enter more

flexible and accessible commitments with other countries, therefore broadening their market access.30

According to the provision, less-developed WTO Members may enter into regional agreements for the mutual reduction or elimination of tariffs, and non-tariff measures, on products imported from one another.31 When creating a regional trade agreement under the Enabling Clause, there is not a

requirement to eliminate restrictions on substantially all trade. The Enabling Clause allows, in principle, members to reduce tariffs and duties between them without leading to zero tariffs or duties.32 This means that, the Enabling Clause allows for the formation of an RTA, which is not either

a custom union or a free trade area, unlike Article XXIV GATT.33 The only real requirement for

states wishing to create an RTA through the enabling clause, is a certain degree of transparency.34

25 Ibid XXIV:8(a)(i). 26 Ibid XXIV:8(a)(ii). 27 Ibid XXIV:8(b). 28 Ibid XXIV:5.

29 World Trade Organization, Differential and More Favourable Treatment Reciprocity and Fuller Participation of

Developing Countries (Marrakesh 15 April 1994) L/4903 entered into force 1 January 1995.

30 Jennifer L Stamberger, 'The Legality of Conditional Preferences to Developing Countries under the GATT Enabling

Clause' (2003) 4(2) Chicago Journal of International Law < https://chicagounbound.uchicago.edu/cjil/vol4/iss2/22/> accessed on 18 July 2020, 607.

Developing Countries (Marrakesh 15 April 1994) L/4903 entered into force 1 January 1995, p.2(c).

32 Islam Rizwanul and Alam Shawkat ‘Preferential Trade Agreements and the Scope of GATT Article XXIV, GATS

Article V and the Enabling Clause: an Appraisal of GATT/WTO Jurisprudence’ (2009) 56(1) Netherlands International Law Review < https://www.cambridge.org/core/journals/netherlands-international-law-review/article/preferential-trade-

agreements-and-the-scope-of-gatt-article-xxiv-gats-article-v-and-the-enabling-clause-an-appraisal-of-gattwto-jurisprudence/2B90FC7EA0C8FBB9D5BE1CB19BB47BE5> accessed on 18 July 2020, 22.

33 Ibid.

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The Role of Anti-Dumping Measures as Economic Policy Tools for

Economic Integration

The practice of “dumping” consists in a decision of an exporting private firm, to sell its products abroad at an “unfairly” low price.35 What is considered to be a “fair” price is defined as “normal

value”.36 If the sale of such dumped products in the domestic market of the importing state, causes,

or threatens to cause a serious injury to the domestic market, then the importing state can impose a duty on top of its bound tariff.37 The intent of such practice is not retributive as such, instead it is used

by States to compensate the lost caused by the selling of dumped products in their domestic market. Anti-dumping rules, are considered by economic scholars as controversial economic policy tools. Part of them consider anti-dumping measures as protectionist tools, which only benefit some producers, and hurt consumers or smaller size importers who need cheap inputs. This school of thought proposes the elimination of anti-dumping measures from international trade agreements, in order to promote competition and functioning markets.38 Sykes is very critical towards anti-dumping

policy. He indeed agrees that it could be useful from an efficiency perspective, to avoid predatory pricing and monopolies by foreign exporters. However, he argues that anti-dumping measures can be replaced with competition rules to deal with unfair trade practices.39 It is important to keep in mind

that sales below normal value are common in many domestic markets, especially when the demand is scarce or if new competitors are entering the market.40 Sykes agrees with Bhagwati, who argues

that anti-dumping policy amounts to “political” defences. Governments have a tendency to restrict trade when they see it as “unfair”. However, Sykes considers that it is not clear and difficult to picture “dumping” as “unfair”, given that it is a quite normal business practice.41

On the other side, supporters of anti-dumping policies, argue that this type of policies serve as guarantees for States to agree to further trade liberalization. Anti-dumping measures allow countries to temporarily suspend their obligations in order to protect industries which are found to be injured more than what expected by the negotiators, due to increased trade liberalization.42 They are

considered as a device to improve liberalization due to the impossibility of predicting the political

35 Alan Sykes, ‘Trade Remedy Laws’ (2005) John M. Olin Law & Economics Working Paper No.240, <

https://papers.ssrn.com/sol3/papers.cfm?abstract_id=698381> accessed on 18 July 2020, 22.

36 Ibid. 37 Ibid. 38 Ibid. 39 Ibid 43-44. 40 Ibid. 41 Ibid 46.

42 Willemien Denner, ‘Trade Remedies and Safeguards in Southern and Eastern Africa’ in Anton Bösl, Gerhard Erasmus,

Trudi Hartzenberg and Colin McCarthy (eds), Monitoring Regional Integration in Southern Africa Yearbook (Vol 9, Trade Law Centre for Southern Africa 2009) 43.

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costs involved in opening trade.43 This is a common case of RTAs, which aim at removing barriers

to intra-regional trade. As a consequence of tariff reduction, a new form of protection is required for the domestic industries. Thus, in RTAs, there is a precise role for anti-dumping duties as a tool for “levelling the playing field” between foreign imports and domestic products.44 Anti-dumping

provisions are present in trade agreements in order to improve the predictability and transparency of trade barriers. In a sense, the amount of liberalization that can be reached, may depend on the clarity and effectiveness of trade remedies provisions in the agreements.45 This is because they would allow

governments to temporarily depart from liberalization, in order to develop a domestic sector which could later on be re-opened to further liberalization. It is true that the removal of trade remedies tools between regional trade partners will most likely lead to an increase in intra-regional trade, however, beneficial trade results may not be a consequence. This is due to fact of the existence of trade creation and trade diversion effects. The preferential treatment given to intra-regional trade, can result as damaging towards the consumers, which will not have access to cheap imports from members not part of the agreement. The main argument for the inclusion of trade remedies in RTAs is that they facilitate tariff liberalization during tariff negotiations.46 When countries negotiate a trade agreement,

which does not allow for temporary tariff increases, and the negotiating parties are unsure about their potential economic growth, they will be more reluctant to open to great tariff reductions.47 It is also

possible to argue that trade remedies could reduce the credibility of a trade agreement. If governments are not fully committed towards liberalization, production may not shift towards more efficient industries as there is a risk of using anti-dumping measures in the future.48

43 Philippe Kohler, ‘The Role of Contingent Protection in WTO Agreements’ (Institut d’Etudes Politiques de Paris, 2001)

< http://www.karyiuwong.com/confer/germ02/papers/kohler.pdf> accessed on 18 July 2020, 13.

44 Thomas J Prusa and Susan Skeath ‘The Economic and Strategic Motives for Antidumping Filings’ (2001) National

Bureau of Economic Research Working Paper Series 8424, < https://www.nber.org/papers/w8424.pdf> accessed on 18 July 2020, 17.

45 Thomas J Prusa, Robert Teh and Michele Budetta ‘Trade Remedy Provisions in Regional Trade Agreements’ (2007)

WTO Staff Working Paper 2007/03, < https://www.econstor.eu/bitstream/10419/72063/1/546168132.pdf> accessed on 18 July 2020, 3-4.

46 Meredith A Crowley ‘Why are Safeguards Needed in a Trade Agreement?’ (2006) Federal Reserve Bank of Chicago

Working Paper 2006/06, <https://www.chicagofed.org/~/media/publications/working-papers/2006/wp2006-06-pdf.pdf> accessed on 18 July 2020, 5.

47 Ibid.

48 Robert W Staiger and Guido Tabellini ‘Discretionary Trade Policy and Excessive Protection’ (1987) 77(5) The

American Economic Review < https://www.jstor.org/stable/1810211?seq=1#metadata_info_tab_contents> accessed on 18 July 2020, 836.

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Part 2 Categorization of African RTAs

A contrast appears to arise when WTO Members, establishing an RTA, include in the agreement rules regulating the use anti-dumping duties. Article VI GATT 1994 and the Anti-Dumping Agreement (ADA) don’t allow for a discriminatory implementation of anti-dumping measures. Anti-dumping provisions must be applied on dumped products, irrespectively of the country of origin of that product. On the other hand, parties to an RTA may derogate from the MFN principle, granting each other preferential treatment, therefore establishing a preferential anti-dumping regime. This contrast is reflected in the structure of the anti-dumping regimes existing in each RTA.

In general, RTAs can be categorized in relation to the type of anti-dumping rules that they implement. On one side, Category A, covers those regional anti-dumping regimes which adopt essentially the same rules of Article VI of the GATT 1994 and the ADA. This type of RTA clearly gives more weight to the policy requirement that anti-dumping measures shall be applied in a non-discriminatory way. In contrast, Category B, covers those RTAs which establish different rules on anti-dumping as compared to the WTO regime.49 In this type of RTA instead, deep integration efforts, and the will to

grant preferential treatment to the other parties of the RTA, has an impact on anti-dumping rules. In the African Continent two slightly different varieties of Category A RTAs are present.

On one side, Category A1 RTAs, like SADC and the AfCFTA, directly make reference to the GATT 1994 and ADA, without even transcribing their content in the agreement. Usually, in these cases, the anti-dumping provisions in the RTA, don’t establish any regional mechanism to address cases of dumping.50 On the other side, Category A2 RTAs like COMESA and EAC, adopt an own set of

anti-dumping rules, which in essence replicates the existing WTO regime, without including any relevant changes. Usually, no specific reference to the GATT 1994 and the ADA is made, but the purpose and the wording often match.51 Also in this case, regional mechanisms to address cases of dumping are

not common.

Category B RTAs, instead, restrict the WTO rights of the parties to undertake anti-dumping measures. As such, it is possible to see how this kind of RTAs can distort trade conditions in favour of imports originating from an RTA partner to the detriment of the like products imported from a third country. It is indeed arguable that, such preferential treatment, which only benefits intra-RTA

49 Jean-Daniel Rey, ‘Do Regional Anti-Dumping Regimes Make a Difference?’ in Rohini Acharya (ed), Regional Trade

Agreements and the Multilateral Trading System (Cambridge University Press 2016) 160.

50 Ibid 175. 51 Ibid 176.

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trade, and, which would not automatically and unconditionally be granted to like products exported by third countries, could be in violation of the MFN principle.52 According to the World Trade Report

2011, if anti-dumping provisions make RTA parties more difficult to sanction, the domestic industry will simply target other sources.53 This phenomenon is called “protection diversion” because as a

consequence of the creation of a Regional Trade Agreement third parties face increased anti-dumping scrutiny, while RTA members are not affected. 54The conditions of access of third county products to

the RTA will not be impaired. However, the access conditions of the RTA members to the same market will be improved, thereby putting third countries in a less favourable position.55 As a

consequence of trade diversion, the targets of anti-dumping action are driven by import volumes and are up to the discretion of the domestic industry. Thus, preferential anti-dumping regimes set up through an RTA, would be likely to motivate the domestic industry to simply target other sources from non-preferential partners.56 An example of Category B RTA is SACU, which specifically

prohibits the use of anti-dumping measures against RTA partners and establishes a regional regime to address cases of imported dumped products from third countries.57 However, none of the SACU

members, except South Africa, which is a heavy user, have ever been involved in anti-dumping disputes at the WTO level. Considering that SACU is a well-established and functioning customs union, it is questionable why it does not take anti-dumping measures as a whole. Since South Africa has taken 132 anti-dumping measures it is also possible that there is an issue of notification, and South-Africa is actually acting in representation of all SACU members.58

Recap Table 1

Category Type of RTA Notification

SADC A(1) Free Trade Area Article XXIV GATT 1994

SACU B Custom Union Article XXIV GATT 1994

EAC A(2) Custom Union Enabling Clause

COMESA A(2) Custom Union Enabling Clause

52 Ibid 178.

53 World Trade Organization, World Trade Report 2011 - The WTO and Preferential Trade Agreements: from Coexistence

to Coherence (WTO Publications 2011) 178.

54 Jean-Daniel Rey, ‘Do Regional Anti-Dumping Regimes Make a Difference?’ in Rohini Acharya (ed), Regional Trade

Agreements and the Multilateral Trading System (Cambridge University Press 2016) 195.

55 Ibid.

56 World Trade Organization, World Trade Report 2011 - The WTO and Preferential Trade Agreements: from Coexistence

to Coherence (WTO Publications 2011) 180-181.

57 Ibid 182. 58 Ibid.

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African Regional Economic Communities

Africa’s economic integration history starts in 1963, with the establishment of the first African regional body, the Organization of African Unity (OAU).59 With the view of boosting intra-African

cooperation and economic integration, the OAU promoted the formation of Regional Economic Communities (REC).60 The plan of the OAU was first to develop the economies within the different

RECs and then to use them as building blocks for a continental economic community.61 However,

the time of implementation of economic integration processes in the RECs was very slow. In order to give a new momentum to continental integration, the OAU signed the Abuja Treaty of 1991, which established the African Economic Community (AEC).62 In addition, the African Union (AU) was

formed in 2000, replacing the OAU.63 The AU decided to focus on the process of promoting

continental economic integration through trade integration.64 At the African Union Summit in 2012,

the decision was taken to establish a Continental Free Trade Area. This new view of a more top down approach might have risen from practical considerations of the difficulties in harmonizing trade policies of African states at the regional level.65 However, as will be shown in the following sections,

despite the new approach, there is an issue with overlapping RECs, which are kept in place. Overlaps in RTAs were already a reason for the scarce and slow implementation of common trade policies at the regional level.66 Different and sometimes conflicting rules can have the effect of slowing down

trade liberalization in the area, and they can hamper integration goals.

The Southern African Development Community

The Treaty which established the SADC was signed in 1992 in Namibia.67 The SADC is an

International Organization with its own legal personality.68 It currently consist of 16 African States:

Angola, the Democratic Republic of the Congo, Madagascar, Malawi, Mozambique, Mauritius,

59 Organization of African Unity, Charter of the Organization of African Unity (Addis Ababa 25 May 1963) entered into

force 13 September 1963 Article 1.

60 Ibid 2.

61 UNCTAD, African Continental Free Trade Area: Policy and Negotiation Options for Trade in Goods

(UNCTAD/WEB/DITC/2016/7, United Nations Publications 2016) 1.

62 Organization of African Unity, Treaty Establishing the African Economic Community (Abuja 3 June 1991) entered into

force 12 May 1994 Article 2.

63 Organization of African Unity, Constitutive Act of the African Union (Lomé 11 July 2000) entered into force 26 May

2001 Article 2.

64 Ibid 3.

65 UNCTAD, African Continental Free Trade Area: Policy and Negotiation Options for Trade in Goods

(UNCTAD/WEB/DITC/2016/7, United Nations Publications 2016) 3.

66 Ibid.

67 South African Development Community, Consolidated Text of the Treaty of the South African Development Community

(Windhoek 17 August 1992) Article 2.

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Seychelles, Tanzania, Union of Comoros, Zambia, Zimbabwe and the five members of SACU i.e. South Africa, Botswana, Lesotho, Namibia and Swaziland. SADC has been notified to the WTO, under Article XXIV GATT, as a free trade area in 2004. Its main objective is to achieve development and economic growth, reduce poverty and improve the standard and quality of life of the peoples of Southern Africa through regional integration.69 Members of SADC agreed to develop policies

oriented towards a progressive elimination of trade obstacles between themselves.70

As a consequence, recognizing that the development of trade, through a trade cooperation framework based on equity, fair competition and mutual benefit, is essential for economic integration, the SADC Members signed the SADC Protocol on Trade in 1996. This entered into force in 2001.71 By 2008,

when 85% of trade between SADC Members was tariff-free, the SADC FTA was launched.72 Despite

an initial promising tariff reduction process, driven especially by SACU countries and Mozambique, not all the Members managed to meet the deadline of 2012 to complete their tariff reductions.73

Anti-Dumping Rules

As stated above, SADC chooses to directly incorporate the WTO anti-dumping regime in its Trade Protocol. First of all, the definition of dumping is directly copied from Article VI of GATT (1994).74

Furthermore, as per the application and use of anti-dumping measures, the Trade Protocol directly refers to the ADA without even transcribing its content. The SADC Trade Protocol allows its members to apply anti-dumping measures which are in conformity with the WTO Agreement.75

In 2012, the SADC Ministerial Task Force on Regional Economic Integration made some recommendations, to consolidate the SADC FTA, trying to address the issue of overlapping membership of various regional economic communities.76 It appears that the main challenge to SADC

economic integration is the overlapping membership of most SADC Members in other REC’s. Beyond having an impact on the Member States ability to meet SADC obligations, it has an impact

69 Ibid Article 5(1)(a). 70 Ibid Article 5(2)(d).

71 South African Development Community, Protocol on Trade in the Southern African Development Community Region

(Maseru 1 August 1996) entered into force 21 January 2001.

72 Trudi Hartzenberg, ‘SADC Think Tank Conference on Regional Integration: Conference Report and Policy Papers’

(SADC Research and Policy Paper Series 02/2012 Maputo 10 August 2012) <

https://www.sadc.int/files/7913/6360/4305/SADC_Think_Tank_Conference_Maputo_2012_EN.pdf> accessed on 18 July 2020, 15.

73 Ibid.

74 South African Development Community, Protocol on Trade in the Southern African Development Community Region

(Maseru 1 August 1996) entered into force 21 January 2001, Article 1.

75 Ibid Article 18.

76 Trudi Hartzenberg, ‘SADC Think Tank Conference on Regional Integration: Conference Report and Policy Papers’

(SADC Research and Policy Paper Series 02/2012 Maputo 10 August 2012) <

https://www.sadc.int/files/7913/6360/4305/SADC_Think_Tank_Conference_Maputo_2012_EN.pdf> accessed on 18 July 2020, 16.

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on the private sector which shall adapt to different trade regimes.77 After having established the free

trade area, the next step would be for SADC Members to establish a customs union. However, this impossible due to overlapping membership: all members of SADC, except Angola and Mozambique, belong to other custom unions like COMESA, EAC and SACU. As a consequence of the Common External Tariff requirement, typical of a custom union, multiple memberships are not possible. The only way in which SADC can become a custom union is if its Member States would choose to leave the other custom unions to which they are parties, in favour of establishing the SADC Custom Union.78 As will be shown later on, the issue of overlapping does not only belong to SADC.

The Southern African Customs Union

SACU is formed by the States of Botswana, Lesotho, Namibia, eSwatini (Swaziland) and South Africa. It was notified to the WTO, under Article XXIV GATT only in 2007. However, it was established in 1910, and, quite interestingly, it is the first custom union ever concluded.79

Historically, SACU was a custom agreement fully administered by South Africa, due to a more advanced stage of development, through the 1910 and 1969 Agreements. South Africa was the only SACU Member responsible for investigating and applying anti-dumping duties.80 The other SACU

Members were therefore obliged to apply the same duties, even if these were not strictly beneficial to them. 81 This was often the case as their domestic industries were not so developed.82

Negotiations to reform the 1969 SACU Agreement started in 1994, soon after South Africa elected its first democratic government.83 This resulted in the 2002 SACU Agreement which was ratified by

all SACU Heads of State.84 This new agreement came as a consequence of the fact that the 1969

SACU Agreement was not in line with the requirements of a custom union in the 21st century because

of the inexistence of common institutions.85 Contrary to the first two SACU agreements, which

simply gave South Africa a trade hegemony over SACU, the 2002 SACU Agreement was oriented

77 Ibid 14. 78 Ibid 16.

79 ‘About SACU’ (Official Southern African Customs Union Website) < http://www.sacu.int/show.php?id=394>

accessed on 18 July 2020.

80 Southern African Customs Union, 1910 Southern African Customs Union Agreement (Pretoria 30 July 1910) Article 3;

Southern African Customs Union, 1969 Southern African Customs Union Agreement (Pretoria 11 December 1969) Article 2 and Article 4(1).

81 Neil Joubert, ‘The Reform of South Africa’s Anti-Dumping Regime’ WTO Managing the Challenges of WTO

Participation: Case Study 38 < https://www.wto.org/english/res_e/booksp_e/casestudies_e/case38_e.htm> accessed on 18 July 2020.

82 Ibid. 83 Ibid.

84 ‘About SACU’ (Official Southern African Customs Union Website) < http://www.sacu.int/show.php?id=394>

accessed on 18 July 2020.

85 Southern African Customs Union, 2002 Southern African Customs Union Agreement (Maseru 21 October 2002) entered

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towards a more “democratic” SACU, which would enable SACU members, other than South Africa, to actively participate in the decision-making processes.86 This intent can already be noticed by the

fact that the 2002 SACU Agreement actually establishes the South African Customs Union, with its headquarters in Namibia.87 SACU is considered to be an international organization with its own legal

personality.88

Under the 2002 SACU Agreement, the management and implementation of trade remedies is harmonized at a supranational level within SACU.89 Article 7 of the Agreement lists the institutions

of SACU, which include the Tariff Board. The Tariff Board, which is to be composed by experts from the Member States, makes recommendations to the Council on the level and changes of customs, anti-dumping, countervailing and safeguard duties on goods imported from outside the Common Customs Area.90 The Tariff Board acts on recommendations given to it by the National Bodies, which

shall be: specialized, independent and dedicated institutions established by and within the respective Member State. 91 The ways and circumstances under which National Bodies conduct investigations

and therefore issue recommendations to the Tariff Board are set out in section 8 of Annex C to the 2002 SACU Agreement.92 Contrary to what was occurring in the previous agreements, where SACU

institutions were actually South African, the Tariff Board is now a supra-national SACU institution. Despite acting on recommendations made to it by the Member States, the Tariff Board will take its own decision and refer it to the Council of Ministers for implementation.93 It is then the SACU

Council, which, voting by consensus, takes the final decision on the imposition of anti-dumping duties.94 Voting by consensus amounts to a veto for SACU Member States.95 However the SACU

into force 15 July 2004, Article 3.

88 Ibid Article 4.

89 World Trade Organization, Trade Policy Review - Report by the Secretariat on the Southern African Customs Union

(WT/TPR/S/324 30 September 2015) para 8.

into force 15 July 2004, Article 11.

91 Ibid Article 14(1).

92 Southern African Customs Union, Annex C on National Bodies to the 2002 Southern African Customs Union Agreement

(Maseru 21 October 2002) entered into force 15 July 2004.

into force 15 July 2004, Article 8(7) and 17.

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Tariff Board has not been created yet. Therefore, due to its long history in anti-dumping measures, the South Africa’s National Body temporarily carries out anti-dumping investigations for the whole SACU.96

To date, South Africa and just recently Botswana, are the only SACU members to have established a National Body, as required under Article 14 of the 2002 SACU Agreement. Of course, without the presence of National Bodies making recommendations, the SACU Tariff Board will not be able to carry out its function. For this reason, the SACU Council of Ministers requested International Trade Administration Commission (ITAC) to handle the administration of anti-dumping investigation for the whole SACU, with the only condition that investigations should be taken in consultation with the other SACU Members.97

In South Africa, the National Body, has been created under Article 7(1) of the International Trade Administration Act of 2002, as the International Trade Administration Commission.98 Subsequent to

an application filed by a legal person to ITAC requesting the adoption of anti-dumping duties in respects of dumped goods imported from third states,99 the ITAC may initiate an anti-dumping

investigation.100 ITAC carries out investigations concerning dumped products in the whole SACU.101

According to the ITAC Anti-Dumping Regulations, an investigation by ITAC is initiated upon written application made on behalf of the SACU industry.102 However, in cases in which the Commission

has sufficient evidence of a relevant change in circumstances relating to dumping, material injury and causal link to justify the initiation of an investigation, it may act on its own means.103 SACU industry,

which may commence an investigation, is defined as, all SACU producers except those which themselves import the products under investigation.104 An application filing a request for an

investigation to the ITAC must be made by at least 25% of SACU producers by domestic production volume.105 Once ITAC recommends the application of anti-dumping duties, then all SACU members

apply them consistently.106 The role of ITAC as a provisional SACU Tariff Board is also visible in

(WT/TPR/S/324 30 September 2015) para 3.37.

98 South Africa, International Trade Administration Act 71 (2002) Published in Government Gazette 2003 No.24287,

Section 7(1).

99 Ibid Section 26. 100 Ibid Section 16. 101 Ibid Section 16(1).

102 International Trade Administration Commission of South Africa, Anti-Dumping Regulation 2003 Published in

Government Gazette 2003 Vol.461 No.25684, Article 3(1).

103 Ibid.

104 Ibid Article 7(2). 105 Ibid Article 7.3.

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Article 13.1 of the ITAC Anti-Dumping Regulation of 2003, which provides that in determining material injury, ITAC considers whether there has been a significant depression of the SACU industry’s prices.107

Also WTO case law can be helpful in this case. On 21 June 2012, Brazil requested consultations with South Africa with regard to the imposition of anti-dumping duties by ITAC on frozen meat of fowls of the Gallus Domesticus species.108 Brazil considered that the determination and imposition of

provisional anti-dumping duties was inconsistent with South Africa obligations under the provisions of GATT 1994 and the ADA.109 What is important for the matter of this thesis is that the investigation

was lodged by “FC Dubbelman and Associates” on behalf of the South African Poultry Association which represents 80% of SACU producers.110 This highlights how, despite resulting as a WTO

dispute involving South Africa, it is actually SACU which is represented by South Africa. Until 2014, South Africa, acting on behalf of SACU, maintained definitive anti-dumping measures on imports from 12 WTO Members.111

As previously stated, Botswana also has a National Body. Article 3(1) of the Botswana Trade Commission Act 2014 establishes the Botswana Trade Commission (BOTC).112 Pursuant to Article

4(1)(b) of the Botswana Trade Commission Act 2014, the BOTC enjoys the right to investigate allegations of dumping within the Common Customs Area which affects Botswana.113 Due to its short

existence, information on BOTC activities is scarce. In 2018 there were rumours calling for a possible winding up of the BOTC, due to a lack of performance, maladministration and abuse of public office, which were immediately silenced by Bogolo Kenewendo, the Minister of Investment Trade and Industry.114 In 2020, according to Howard Sigwele, the BOTC Board Chairperson, the BOTC has

been regulating imports of goods into Botswana and also provided infant industry protection to emerging industries.115 Furthermore since February 2020, the BOTC has been doing workshops in

different regions of Botswana to raise awareness in the business community of the BOTC mandate

107International Trade Administration Commission of South Africa, Anti-Dumping Regulation 2003 Published in

Government Gazette 2003 Vol.461 No.25684, Article 13(1).

108 Request for Consultations on South Africa – Anti-Dumping Duties on Frozen Meat of Fowls from Brazil WT/DS439/1,

25 June 2012.

109 Ibid.

110 International Trade Administration Commission of South Africa, Investigation on the Alleged Dumping of Frozen

Meat Fowls of the Species Gallus Domesticus, Whole Bird and Boneless Cuts, Originating in or Imported from Brazil: Primary Determination Report No.389, 2012.

(WT/TPR/S/324 30 September 2015) para 3.41.

112 Botswana, Trade Commission Act (2014) Act 20 2013, S.I. 70 2014, Article 3. 113 Ibid Article 4.

114 Phillimon Mmeso, ‘BOTC Wind-Up Secretly?’ (The Patriot, 20 June 2018) <

http://www.thepatriot.co.bw/news/item/5674-botc-wind-up-secretly.html> accessed on 18 July 2020.

115 Kedirebofe Pelontle, ‘Trade Commission Engages Maun Entrepreneurs’ (Botswana Daily News, 20 February 2020) <

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in the area of trade defence instruments. The purpose is to educate stakeholders on the effectiveness of trade defence instruments in employment retention and creation, therefore supporting the underlying government objective of promoting investment, growth and sustainable employment.116

The East African Community

The East African Community (EAC) is an African REC composed by six members: the original signatories Kenya, Tanzania and Uganda, plus the later added Burundi, Rwanda and South Sudan.117

The Treaty Establishing EAC was signed in 1999, and came into force in 2000.118 The EAC custom

union was notified to the WTO in year 2000, through the enabling clause. EAC has a broad scope and a fine aim. As stated in Article 5(1) of the Treaty “the objectives of the Community shall be, to

develop policies and programs, aimed at widening and deepening cooperation, among the Partner States in political, economic, social and cultural fields, research and technology, defence, security and legal and judicial affairs for their mutual benefits.”119 In order to reach their objective, EAC

Partner States aim to establish a “custom union, a common market, subsequently a monetary union

and ultimately a political federation”.120 EAC Member States decided to create a common East

African Trade Regime, cooperating in trade development and liberalization.121 Within 2004, Member

States agreed to issue a Protocol on the Establishment of the East African Customs Union.122 In

particular, EAC members had to agree on common requirements to be set out in a Protocol, regarding Dumping.123

Article 2(1) of the 2004 Protocol establishes the EAC Customs Union, under which EAC states are required to cooperate in custom management and trade, in particular on the use of trade remedies and the prevention, investigation and suppression of custom offences.124 Moreover, the Protocol

establishes the EAC Committee on Trade Remedies which handles any matter regarding

anti-116 ‘Business Botswana and Botswana Trade Commission Engages with the Ghanzi Business Community’ (Business

Botswana, 17 February 2020) <

http://bb.org.bw/index.php/business-news-details/nid/115/business-botswana-and-botswana-trade-commission-engages-with-the-ghanzi-business-community/> accessed on 18 July 2020.

117 East African Community, The Treaty for the Establishment of the East African Community (Arusha 30 November

1999) entered into force 7 July 2000, Article 3(1).

1999) entered into force 7 July 2000.

119 Ibid Article 5.

120 Ibid Article 2(2) and Article 5(2). 121 Ibid Article 74.

122 Ibid Article 75(7). 123 Ibid Article 75(1)(f).

124 East African Community, Protocol on the Establishment of the East Africa Customs Union (Arusha 2 March 2004)

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dumping measures provided for under the EAC Custom Union Anti-dumping Regulations contained in Annex IV of the Protocol.125 The Committee is composed of members nominated by the partner

states, which are qualified and competent in matters of trade, custom and law.126 Once the Committee

is created, the partner states will have to inform the Committee regarding which national body will be considered as the investigating authority in charge of conducting investigations on behalf of the Committee.127 The Committee will have a coordinating role. The investigations are conducted

directly by the authorities of the Members States.128 In case the investigations result in an injury to a

domestic industry, the Committee makes a recommendation to the Council, which then issues its decisions.129 Once the Council has made its decision, the Committee annually reviews the

implementation and operation of the decision.130 The Protocol prohibits the practice of dumping,

however, it allows for the use of anti-dumping measures between all parties, therefore following the same line of the GATT 1994.131 Regarding this purpose, Article 20 of the Protocol sets out the

conditions, under which cooperation, between partner states occurs in a situation of dumping. Partner states are required to cooperate in the investigations regarding injuries caused by dumping.132 As a

consequence of an injury to the domestic industry, a partner state is authorized under the Protocol to impose anti-dumping duties on a third country. In such a case, the same partner state may request other EAC States to impose the same measures vis-à-vis the third country.133 As stated above, Annex

IV to the Protocol contains the substantive provisions regarding the conditions for the application of anti-dumping measures.134 The annex literally transposes the content of Article VI GATT 1994 and

the ADA.

According to the last WTO report on EAC made by the Secretariat in 2019, there has been no use so far of anti-dumping measures by EAC Countries.135 Even if members may initiate investigations and

reviews against each other, this has never happened.136 Kenya is the only state party to EAC to have

a national legislation on trade remedies.137 Considering instead, the EAC Committee on Trade

Remedies, the previous WTO Report which was made in 2012, found that it hadn’t been established

125 Ibid Article 24(1)(b). 126 Ibid Article 24(2). 127 Ibid Article 24(3). 128 Ibid Article 24(4)(a). 129 Ibid Article 24(4)(e). 130 Ibid Article 24(4)(g). 131 Ibid Article 16(1). 132 Ibid Article 24(1). 133 Ibid Article 24(2).

134 East African Community, Annex IV to the Protocol on the Establishment of the East African Community Customs

Union on Anti-Dumping Measures (Arusha 2 March 2004) entered into force 1 January 2005, Regulation 6.

135 World Trade Organization, Trade Policy Review - Report by the Secretariat on the East African Community

(WT/TPR/S/384 13 February 2019) para 15.

136 Ibid. 137 Ibid.

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yet. According to the EAC Secretariat it would have been operative by 2013.138 The report of 2019,

despite stating that indeed the Protocol provides for the establishment of a Committee on Trade Remedies, it does not give any further update on the status of operationalization of the Committee.139

In a press-conference in October 2019, the East African Legislative Assembly (EALA), which is EAC legislative body,140 stated that the delay in the region to establish the Trade Remedy Committee

is negatively affecting the business community, and is having a negative impact on infra-EAC trade.141 EALA requested the Council to speed up the process and operationalize the Committee on

Trade Remedies by April 2020 and that any further delay would jeopardize the integration process. Mohammed Mnyaa, a member of EALA, stated that “in 2007, when Rwanda and Burundi joined the

Community, there was need to amend the Protocol and that was a genuine reason not to be formed. What is the rationale for the delay beyond 2009 up to date, given the Summit of EAC Heads of State had approved the amendment yet, no ratification was done? Such experience should not be repeated in the future”.142 Another legislator, Abdulla Makame said that the Committee on Trade Remedies

was sill necessary and it was important for the Trade Remedies Committee to be fully expedited in the shortest time possible.143 As a reply, the Chair of the EAC Council of Ministers, Olivier

Ndugungirehe, communicated that the Trade Remedies Committee would be realized within the deadline requested by EALA.144

As previously stated, Kenya is the only EAC Member who developed a national framework. From its 2017 trade report, is possible to notice that, despite the existence of a policy framework under EAC, the country lacks a domestic legal framework and an internal institutional mechanism which is capable of undertaking investigations in cases of dumping. This current situation has exposed, or threatens to expose many Kenyan producers. The inexistence of a Kenyan anti-dumping investigating authority has the effect of killing infant domestic industries and all the country efforts to promote domestic production.145 According to the report, Kenya commits to develop a national Trade

(WT/TPR/S/271 17 October 2012) para 92.

(WT/TPR/S/384 13 February 2019) para 3.56.

1999) entered into force 7 July 2000, Article 49.

141 East Africa Community, ‘EALA Urges Partner States to Duly Institute Trade Remedies Committee’ East Africa

Legislative Assembly Press Conference Report (Arusha 1 October 2019) < https://www.eac.int/press-releases/1576-eala-urges-partner-states-to-duly-institute-trade-remedies-committee> accessed on 18 July 2020.

142 Ibid. 143 Ibid. 144 Ibid.

145 Kenya State Department for Trade, National Trade Policy – Transforming Kenya into a Competitive Export-Led and

Efficient Domestic Economy (Republic of Kenya May 2017) <

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Remedies Legislation.146 At the end of the same year of the report, Kenya published in its gazette the

Kenya Trade Remedies Act 2017.147 The Kenya Trade Remedies Act 2017 established the Kenya

Trade Remedies Agency,148 which will be based in Nairobi,149 and will investigate and evaluate

allegations of dumping of imported products in Kenya.150 The Kenya Trade Remedies Act 2017

transposes into Kenyan National Law Annex IV of the Protocol on the creation of the EAC Custom Union. Therefore, Kenya Trade Remedies Act 2017 is also very similar to the language and content of the GATT 1994 and ADA Agreement.

This choice made by Kenya could be seen as a protectionist move. However it is the only EAC State which has developed a national investigating authority. Despite being the only one, contrary to what happens under SACU, the Kenyan investigating authority does not carry out investigations for the whole EAC territory. This could result in Kenya being more protected than other EAC Members markets, which is not useful to achieve regional economic integration. It is remarkable that both anti-dumping regimes don’t prohibit the use of anti-anti-dumping duties against partner states considering that EAC is a customs union. The EAC Trade report 2019 also confirms that the overlapping membership of RECs, in particular COMESA and SADC (including SACU), are a challenge and complicate the national trade regimes.151

The Common Market for Eastern and Southern Africa

The Common Market for Eastern and Southern Africa (COMESA) is a custom union formed by 21 different African States namely: Burundi, Comoros, Djibouti, Democratic Republic of the Congo, Egypt, Eritrea, Ethiopia, Kenya, Libya, Madagascar, Malawi, Mauritius, Rwanda, Seychelles, Somalis, Sudan, Swaziland, Tunisia, Uganda, Zambia and Zimbabwe.

The COMESA Treaty was signed in 1993 and ratified in 1994. The COMESA custom union was notified to the WTO in year 1995, through the enabling clause.152 COMESA is defined as an

“organization of free independent sovereign states which have agreed to cooperate in developing

their natural and human resources for the good of all their people”.153 Sixteen States within

146 Ibid Section 5.3.9.

147 Parliament of Kenya, Kenya Trade Remedies Act 2017 Published in Kenya Gazette Supplement No.125 Act No. 32

(Nairobi 21 July 2017) entered into force 16 August 2017.

148 Ibid Article 3(1). 149 Ibid Article 4. 150 Ibid Article 5(a)

(WT/TPR/S/384 13 February 2019) para 5.

152 World Trade Organization, ‘Regional Trade Agreements Database’

<http://rtais.wto.org/UI/PublicShowMemberRTAIDCard.aspx?rtaid=121> accessed on 18 July 2020.

153 ‘COMESA Objectives and Priorities’ (Official COMESA Website) <https://www.comesa.int/company-overview-2/>

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COMESA successfully established the COMESA Free Trade Area in year 2000. More recently, in 2009, COMESA established the COMESA Custom Union, which however is not yet operative.154 In

Article 4 Member States are required to cooperate in all activities regarding customs management and trade which shall include “trade remedies and the prevention, investigation and suppression of customs offences”155

Article 51(4) of the COMESA Treaty prohibits the practice of dumping. 156 As it happens in the EAC,

COMESA members are allowed to apply anti-dumping duties against all States when dumping causes, or threatens to cause, material injury to the relevant domestic industry.157 The structure

followed is the same of the GATT 1994. In the application of anti-dumping measures, Member States are required to cooperate in the detection and investigation of dumping.158 Where necessary, a

Member State applying anti-dumping measures, may request the other Member States, to apply the same duties on the goods that are being dumped in the territory of the requesting State.159 This rule

may be helpful in order to avoid that a product can “escape” from anti-dumping duties by entering the COMESA market from another Member State.

The regulations for the application of anti-dumping measures have been adopted in 2002 by the COMESA Council of Ministers on the basis of Article 10(1) of the COMESA Treaty which authorizes the COMESA Council of Ministers to do so.160 COMESA Member States are required to

adopt the COMESA Regulations on Trade Remedy Measures, when an investigation is initiated against the imports made from another COMESA Member State.161

The COMESA Regulations on Trade Remedy Measures under the COMESA Treaty, rely very much on the work of the different national investigating authorities. Only them, on a request made by the domestic industry, may initiate an anti-dumping investigation and if successful apply anti-dumping duties.162 Regulation 49 sets up a COMESA Group of Experts on Trade Remedies also referred as

the “Group on Trade Remedies” which shall be composed of representatives of each of the Member

154 Common Market for Eastern and Southern Africa, Council Regulations Governing the COMESA Customs Union

Published in COMESA Official Gazette Vol.15 No.1 (Victoria Falls 9 June 2009) Article 2.

155 Ibid Article 4(1)(c).

156 Common Market for Eastern and Southern Africa, Treaty Establishing the Common Market for Eastern and Southern

Africa (Kampala 5 November 1993) entered into force 8 December 1994, Article 51(4).

157 Ibid.

158 Ibid Article 54(1). 159 Ibid Article 54(2).

160 Common Market for Eastern and Southern Africa, COMESA Regulations on Trade Remedies Measures under the

COMESA Treaty (November 2011) entered into force November 2012.

161 Ibid Article 3(3). 162 Ibid Article 18(3)(4).

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States.163 The Group on Trade Remedies however, is not the COMESA investigating authority. Its

task are to make recommendations to the Trade Committee regarding possible improvements to the Regulation and to monitor the compliance of investigating authorities with the procedural requirements.164

Up to date, no anti-dumping measure has been imposed under COMESA, and the only COMESA Member State with an established and functioning investigating authority is Egypt. Already in 1998, even before the COMESA Council adopted the COMESA Regulations on Trade Remedies, Egypt had already notified to the WTO the existence of a domestic regulation on trade remedies.165

According to the Egyptian law, the Ministry of Trade and Supply shall be the competent authority for implementing the provisions of Law No.161/1998. 166 The investigating authority will be the

Trade Policies Department (Anti-Dumping, Subsidy and Safeguard Department), Foreign Trade Sector.167 Article 3 instead establishes the Advisory Committee which is in charge of considering the

investigation concluded by the Trade Policies Department, and make recommendations to the Ministry of Trade and Supply who will then take the final decision.168

Recap Table 2

Possibility to adopt AD measures against other REC Member States

Existence of a REC Investigating Authority SADC YES NO SACU NO YES EAC YES NO COMESA YES NO 163 Ibid Article 49(1). 164 Ibid Article 49(2).

165 World Trade Organization, Notification of Laws and Regulations Under Articles 18.5 and 32.6 of the Agreements

(G/ADP/N/1/EGY/2 11November 1998).

166 Presidency of the Republic of Egypt, Law No. 161 of the Year 1998 Concerning the Protection of National Economy

from the Effects of Injurious Practices in International Trade Published in Official Journal Issue No.24 Sup. A (Cairo 11

June 1998) entered into force 12 June 1998.

167 Ibid Article 1. 168 Ibid Article 3.

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Part 3 The Tripartite Free Trade Area

In an attempt to overcome the issue of overlapping memberships in different RECs, in 2015, the heads of state of COMESA, EAC and SADC, officially launched the COMESA-EAC-SADC Tripartite Free Trade Area (TFTA).169 The TFTA has a total of 27 participating member states. 24 States have signed

the Sharm El Sheikh Declaration lunching the TFTA, however up to date only 8 have ratified the Agreement establishing the TFTA, which requires at least 14 ratifications before entering into force. As of today, the TFTA is not in force.

The TFTA is not a project which comes directly from the three RECs. The TFTA is considered to be a milestone for the creation of the AfCFTA.170 When negotiating the AfCFTA, the parties were

already aware of the difficulties of overlapping memberships in the RECs, especially in the SADC-EAC-COMESA region, where a lot of overlapping is present. The underlying idea was to resolve the stagnation which was present in the RECs due to overlapping memberships. They agreed that, in order to deepen and boost the integration process, the merging of the three RECs in a single Free Trade Area, would solve the issue of overlapping Memberships.171 The objectives of the TFTA, are

coherent with the ones of the AfCFTA and the other RECs, namely to promote economic development in the region, by creating a single market in order to promote intra-regional trade, and enhance the regional and continental integration process.172

As per the use of anti-dumping measures in the TFTA, Article 16 of the Agreement allows TFTA Members to apply the anti-dumping rules present in their RECs. This option is possible only if dumping is occurring between two members of the same REC.173 In cases where dumping is occurring

between TFTA Members which are not party to the same REC, the relevant WTO provisions will apply. In cases where a surge of imports caused by dumped products, affects more than one TFTA Member, then TFTA Members, shall cooperate in the investigation of dumping and in the imposition

169 Tripartite Free Trade Area Member States, Sharm El Sheikh Declaration Launching the COMESA-EAC-SADC

Tripartite Free Trade Area (Sharm El Sheikh 10 June 2015).

170 African Union, Declaration on Boosting Intra-African Trade and the Establishment of a Continental Free Trade Area

(Addis Ababa 30 January 2012) Para 6.

171 Ibid Preamble.

172 Tripartite Free Trade Area Member States, Agreement Establishing a Tripartite Free Trade Area Among the Common

Market for Eastern and Southern Africa, the East African Community and the Southern African Development Community

(Sharm El Sheikh 10 June 2015) Article 4.

An African Continental Investigating Authority: a Possible Solution for Conflicting Anti-Dumping Regimes and Overlapping Regional Trade Agreements