   
  
G/SG/N/8/RUS/4  
G/SG/N/10/RUS/4  
 
24 June 2019  
(19-4268) Page: 1/6 
Committee on Safeguards  Original: English  
 
NOTIFICATION UNDER A RTICLE 12.1 (B) OF THE AGREEMENT  ON  
SAFEGUARDS ON FINDING A SERIOUS  INJURY OR THREAT  
THEREOF CAUSED BY IN CREASED IMPORTS  
 
NOTIFICATION OF A PROPOSAL TO  
IMPOSE A MEASURE  
 
RUSSIAN FEDERATION  
(Certain flat -rolled steel products ) 
The following communication, dated 2 4 June 2019, is being circulated at the request of the 
delegation of the Russian Federation . 
 
_______________  
 
 
On 7 August 2018 the Department f or Internal Market Defence of the Eurasian Economic Commission 
(hereinafter 'the DIMD ') initiated a safeguard investigation on imports of certain flat -rolled steel 
products into the customs territory of the Eurasian Economic Union (hereinafter 'Union ') (see WTO 
document G/SG/N/6/ RUS/5). 
 
Pursuant to Article 12.1 (b) of the Agreement on Safeguards the Russian Federation hereby notifies 
the Committee on Safeguards that the DIMD has made a finding of the threat of serious injury to 
the domestic industry caused  by increased imports.  
 
Draft report setting forth the findings and reasoned conclusions reached on all pertinent issues of 
fact and law and the public notice on publication of a draft report were published on 10 June 2019 
on the official website of the Eurasian Economic Union : 
(http://eec.eaeunion.org/ru/act/trade/podm/investigations/PublicDocuments/SG10_report.pdf , 
http://eec.eaeunion.org/ru/act/trade/podm/investigations/PublicDocuments/SG10_notice_publicati
on.pdf ).  
 
1. Provide evidence, citing relevant data and the applicable period o f investigation  of 
serious injury or threat thereof caused by increased imports . 
 
The DIMD has made an injury assessment for three product categories covered by the investigation, 
namely hot -rolled steel products, cold -rolled steel products and coated stee l products named 
together 'certain flat -rolled steel products '. The investigation covers the period from 1 January 2015 
to 30 June 2018 ( hereinafter  'period of investigation ').  
 
In the case of hot -rolled steel products, the analysis of economic indicators  has revealed that the 
Union industry was losing its market share on the Union market to foreign producers, which had a 
negative impact on the Union industry 's prices. Indeed, the growth in costs per unit outpaced the 
price increase leading to a decline in  the level of profitability.  
 
It has also been found that increased imports of hot -rolled steel products into the Union market are 
expected to continue in the immediate future. Indeed, in addition to the risk of trade diversion posed, 
inter alia , by the measures under Section 232 of the Trade Expansion Act of 1962  adopted by the 
United States of America, several countries have steel capacity expansion plans while, first, demand G/SG/N/8/RUS/4 • G/SG/N/10/RUS/4  
 
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  on certain markets is likely to decrease and, second, the ability of third mar kets to absorb additional 
exports of steel is limited due to the trade measures in place. At the same time, the Union market 
is attractive to suppliers of hot -rolled steel products from third countries, in particular in view of its 
size and prices.  
 
Increa sing volumes of imports of hot -rolled steel products will continue to take market share away 
from the Union industry and displace sales of the Union industry on the Union market. This will result 
in a decline in the levels of production by the Union indust ry, sales of the Union industry in the Union 
market and profits earned by the Union industry from such sales. In addition, if costs of production 
continue to increase, the price of the Union industry 's hot-rolled steel products on the Union market 
will be prevented from increasing at a commensurate rate with costs and the level of profitability 
will further decline.  
 
The DIMD has therefore concluded that the Union industry will imminently become seriously injured 
if no measures are taken. The DIMD has also concluded that there is a causal link between increased 
imports of hot -rolled steel products and the threat of serious injury to the Union industry.  
 
The DIMD has found  that cold -rolled steel products and coated steel products are not being imported 
in suc h increased quantities as to cause or threaten to cause serious injury to the Union industry.  
 
2. Provide information on whether there is an absolute increase in imports or an increase 
in imports relative to domestic production (please see also Article 2.1  for the context) . 
 
The DIMD has analyzed import data covering the period of investigation, i.e. the period from 
1 January  2015 to 30 June 2018 for each three product categories covered by the investigation, 
namely hot -rolled steel products, cold -rolled st eel products and coated steel products. The DIMD 
has analyzed data for each year of the period of the investigation, as well as for the period 
1 July 2017 – 30 June 2018 compared with the period 1 July 2016 - 30 June 2017.  
 
The DIMD has not found evidence  of an absolute increase in imports or an increase in imports relative 
to domestic production concerning cold -rolled steel products and coated steel products.  
 
In the case of hot -rolled steel products, imports increased in absolute terms by 25 .6% from 2015  
to 2017 and by 25 .9% in the period 1 July 2017 - 30 June 2018 compared with the period 
1 July 2016 - 30 June 2017.  
 
In relation to domestic production imports increased by 6 .1% between 2015 and 2017 and by 6 .5% 
in the period 1 July 2017 - 30 June 2018 com pared with the period 1 July 2016 - 30 June 2017.  
The DIMD concludes that there has been a sudden, sharp and recent increase in imports both in 
absolute and relative terms (to domestic production) for hot -rolled steel products.  
 
3. Provide the precise desc ription of the product involved . Provide the Harmonized System 
numbers under which the product enters at least at a 6 -digit HS level, and at a sub -
national level (e.g. 8 -digit HS, 9 -digit HS or 10 -digit HS) if practicable . (The HS codes will 
be provided for reference purposes only .) 
 
The products covered by the finding of threat of serious injury are hot -rolled steel products (hot -
rolled carbon steel and other alloy steel in sheets and coils).  
 
Hot-rolled steel products are classified under the following codes within the Common Commodity 
Nomenclature of Foreign Economic Activity of the Eurasian Economic Union (CN of FEA EAEU): 7208 
10 000 0, 7208 25 000 0, 7208 26 000 0, 7208 27 000 0, 7208 36 00 0 0,  
7208 37 000 0, 7208 38 000 0, 7208 39 000 0, 7208 40 000 0, 7208 51 200 1, 7208 51 200 9,  
7208 51 910 0, 7208 51 980 0, 7208 52 100 0, 7208 52 910 0, 7208 52 990 0, 7208 53 100 0,  
7208 53 900 0, 7208 54 000 0, 7208 90 200 0, 7208 90 800 0, 7211 13 0 00 0, 7211 14 000 0,  
7211 19 000 0, 7225 30 100 0, 7225 30 300 0, 7225 30 900 0, 7225 40 120 1, 7225 40 120 9,  
7225 40 150 1, 7225 40 150 9, 7225 40 400 0, 7225 40 600 0, 7225 40 900 0, 7226 91 200 0,  
7226 91 910 0, 7226 91 990 0.  
 
The codes of CN of F EA EAEU are given for information purposes only.  
 G/SG/N/8/RUS/4 • G/SG/N/10/RUS/4  
 
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  4. If the final measure replaces a provisional measure, or if a final measure is extended, 
a Member is encouraged to provide a written description of any part of the imported 
product that will no longer be subject to the measure and the Harmonized System 
numbers under which it enters at least at a 6 -digit level, and at a sub -national level (e.g., 
8-digit, 9 -digit or 10 -digit level) if practicable.1 
 
Not applicable . 
 
5. Provide precise description of the prop osed measure.  
 
The measure recommended by the DIMD is a quota on imports of hot -rolled steel products with an 
out-of-quota duty of 20%.  
 
Consistent with the obligations under Article 9.1 of the Agreement on Safeguards, the measure 
recommended by the DIMD applies to imports from all sources, other than originating in developing 
and least -developed countries benefitting from the Unified System of Tariff Preferences (USTP) of 
the Eurasian Economic Union, except for the Republic of Korea (see the list of devel oping countries 
in Annex below).  
 
Shares of imports from developing and least -developed countries, except for the Republic of Korea, 
individually do not exceed 3% and collectively do not account for more than 9%.  
 
In order to comply with bilateral obligat ions under the Treaty on a Free Trade Area between Members 
of the Commonwealth of Independent States (CIS), Republic of Moldova, Uzbekistan and Tajikistan 
should also be excluded from the scope of the measure.  
 
Since hot -rolled steel used in the production  of pipes (7208  51 910 0, 7208  51 200 9 and 
7225 40 400 0 of CN of FEA EAEU) accounts for 56% of imports of hot -rolled steel products for the 
period from 2015 to 2017, the DIMD proposes a separate amount of quota for these products.  
 
The quota volume reco mmended by the DIMD is as follows : 
Product concerned  
(CN of FEA EAEU)  Quota Volume (tones)  
Armenia  Belarus  Kazakhstan  Kyrgyz 
Republic  Russian 
Federation  
7208 10 000 0, 7208  25 000 0, 
7208 26 000 0, 7208  27 000 0, 
7208 36 000 0, 7208  37 000 0, 
7208 38 000 0, 7208  39 000 0, 
7208 40 000 0, 7208  51 200 1, 
7208 51 980 0, 7208  52 100 0, 
7208 52 910 0, 7208  52 990 0, 
7208 53 100 0, 7208  53 900 0, 
7208 54 000 0, 7208  90 200 0, 
7208 90 800 0, 7211  13 000 0, 
7211 14 000 0, 7211  19 000 0, 
7225 30 100 0, 7 225 30 300 0, 
7225 30 900 0, 7225  40 120 1, 
7225 40 120 9, 7225  40 150 1, 
7225 40 150 9, 7225  40 600 0, 
7225 40 900 0, 7226  91 200 0, 
7226 91 910 0,          7226 91 990 0 9 669  89 633  4 913  2 357  334 628  
7208 51 200 9, 7208  51 910 0, 
7225 40 400 0  329 36 640  5 116  329 512 982  
 
6. Provide proposed date of introduction of the measure.  
 
The decision has not been taken yet.  
 
                                                
1 The HS codes will be provided for reference purposes only.  G/SG/N/8/RUS/4 • G/SG/N/10/RUS/4  
 
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  7. Provide expected duration of the measure.  
 
The DIMD has recommended that the measure be in force for 1 year.  
 
8. For a measure with a duration of more than three years, provide the proposed date for 
the review (under Article 7.4) to be held not later than the mid -term of the measure, if 
such a date for the review has already been scheduled.  
 
Not applicable . 
 
9. If the expected duration is over one year, provide expected timetable for progressive 
liberalization of the measure.  
 
Not applicable  
 
10. If the notification relates only to a finding of serious injury or threat thereof, and does 
not relate to a decision to a pply or extend a safeguard measure:  
 
i. provide the deadlines for interested parties to comment or any other 
procedures relevant to the decision to apply the measures, and  
ii. provide information regarding procedures for prior consultation with those 
Members hav ing a substantial interest as exporters of the product concerned.  
Interested parties are invited to comment on findings and reasoned conclusions reached on all 
pertinent issues of fact and law set forth in a draft report published on 10 June 2019 on the of ficial 
website of the Eurasian Economic Union : 
 
http://eec.eaeunion.org/ru/act/trade/podm/investigations/PublicDocuments/SG10_report.pdf  
 
Comments shou ld be submitted to the DIMD no later than 24 June 2019  as it is provided for in the 
public notice on publication of a draft report : 
 
http:/ /eec.eaeunion.org/ru/act/trade/podm/investigations/PublicDocuments/SG10_notice_publicati
on.pdf  
 
The DIMD offers consultations with Members having a substantial interest as exporters of the product 
concerned. The time limit for such consultations is 24 June  2019 as it is provided for in the public 
notice on publication of a draft report : 
 
http://eec.eaeunion.org/ru/act/trade/podm/investigation s/PublicDocuments/SG10_notice_publicati
on.pdf   
 
11. If the measure is being extended, also provide:  
 
i. evidence that the industry concerned is adjusting and that the safeguard measure 
continues to be necessary to prevent or remedy serious injury;  
ii. reference to the WTO document that notified the initial application of the 
measure;  
iii. duration of the measure from initial application till the date at which it will 
be extended; and,  
iv. precise description of the measure in place prior to the date of extension (in 
this context, please note that the last sentence of Article 7.4 states that: "A 
measure extended under paragraph 2 shall not be more restrictive than it was 
at the end of the initial period, and should continue to be liberalized.")  
Not applicable . 
 G/SG/N/8/RUS/4 • G/SG/N/10/RUS/4  
 
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  12. If the n otification relates to a decision to apply or extend a safeguard measure, 
Members are encouraged to provide the following information:  
 
i. The major exporting Members of imports of the product involved.  
ii. If there are any exporting Members to which the measure does not apply for 
any reason other than the application of Article 9.1, the names of such 
exporting Members and reasons for non -application of the measure.  
Not applicable  
 
13. Members are encouraged to attach, in an electronic form, publicly available 
document(s) containing the relevant decision(s) made by the competent authority.  
 
This document may be in the original language of the Member, even when the language 
is not one of the official languages of the WTO. The document will neither be translated 
nor circulated to the Committee, but will be made available by the Secretariat to Members 
requesting it.  
 
Draft report setting forth the findings and reasoned conclusions reached on all pertinent issues of 
fact and law was published on 10 June 2019 on the of ficial website of the Eurasian Economic Unio n 
(http://eec.eaeunion.org/ru/act/trade/podm/investigations/PublicDocuments/SG10_report.pdf ). 
  G/SG/N/8/RUS/4 • G/SG/N/10/RUS/4  
 
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  ANNEX   
List of developing and least -developed countries, Members of WT O 
 
__________  Afghanistan   Liberia  
Albania  Madagascar  
Angola  Malawi  
Antigua and Barbuda  Malaysia  
Argentina  Maldives  
Bahrain  Mali  
Bangladesh  Mauritania  
Barbados  Mauritius  
Belize  Mexico  
Benin  Mongolia  
Bolivarian Republic of Venezuela  Montenegro  
Botswana  Morocco  
Brazil  Mozambique  
Brunei Darussalam  Myanmar  
Burkina Faso  Namibia  
Burundi  Nepal  
Cabo Verde  Nicaragua  
Cambodia  Niger  
Cameroon  Nigeria  
Central African Republic  North Macedonia  
Chad  Oman  
Chile  Pakistan  
China  Panama  
Colombia  Papua New Guinea  
Congo  Paraguay  
Costa Rica  Peru  
Côte D'Ivoire  Philippines  
Croatia  Plurinational State of Bolivia  
Cuba  Qatar  
Democratic Republic of the Congo  Rwanda  
Djibouti  Saint Kitts and Nevis  
Dominica  Saint Lucia  
Dominican Republic  Saint Vincent and the Grenadines  
Ecuador  Samoa  
Egypt  Senegal  
El Salvador  Seychelles  
Eswatini  Sierra Leone Singapore  
Fiji  Solomon Islands  
Gabon  South Africa  
Gambia  Sri Lanka  
Ghana  Suriname  
Grenada  Tanzania  
Guatemala  Thailand  
Guinea  The State of Kuwait  
Guinea -Bissau  Togo  
Guyana  Tonga  
Haiti  Trinidad and Tobago  
Honduras  Tunisia  
Hong Kong, China  Turkey  
India  Uganda  
Indonesia  United Arab Emirates  
Jamaica  Uruguay  
Jordan  Vanuatu  
Kenya  Viet Nam  
Kingdom of Saudi Arabia  Yemen  
Lao People's Democratic Republic  Zambia  
Lesotho  Zimbabwe  