The European Union will not renew its anti-dumping duties on imports of leather shoes from China and Vietnam introduced at the end of 2006 after they expire on March 31. As it turns out, the European shoe industry federation, CEC, did propose their extension before Christmas after an internal vote, providing evidence of continued dumping. However, after a series of meetings with his office, the EU trade commissioner, Karel de Gucht, indicated that there was insufficient political will for a new anti-dumping investigation. Sources indicate that his priority is to improve trade relations with China in every respect.

The last of those meetings took place at the beginning of this week, triggering CEC's final decision not to pursue the matter further. A press release circulated by CEC through the Italian shoe industry association, Anci, announced its new position, but pointed out that the Commission had agreed to monitor shoe imports from China, Vietnam and other sources on a weekly basis to assess the application of fair trade principles after the duties are lifted next April. The Commission will hold quarterly meetings with the two governments and put extra pressure on the Chinese government to open up its market for shoe imports from Europe, the Anci/CEC statement said.

According to Anci officials, the new surveillance mechanism will be a test for new and more stringent criteria to determine dumping, possibly leading to a new complaint after four to six months. Vito Artioli, chairman of Anci and CEC, praised the Commission's efforts to foster fair trade and monitor the ?real intentions? of the two countries. He said that, if its monitoring activities reveal the persistence of dumping practices, the Commission would be ready to introduce new anti-dumping proceedings. He stated that CEC was ready to accept free competition, provided the rules of free trade are respected.

According to well-informed sources, de Gucht's liberal stance on the issue followed intense lobbying by the Footwear Alliance with the individual governments of the EU. The Footwear Alliance represents the German shoe manufacturers association (HDS), the European Sporting Goods Industry Federation (Fesi) and major European shoe importers. However, the Footwear Alliance wants to ensure that the monitoring criteria adopted by the Commission to determine possible dumping are fair. The issue will probably be debated at a meeting of the Commission's anti-dumping committee in Brussels tomorrow.

The German government had already stated that it did not want the anti-dumping measures to remain in place after March 2011 when it surprisingly supported them at the end of 2009, tilting the balance in the final hair-split vote that sanctioned their continuation. This time, sources said, even the Italian government backed off, indicating that it was more interested in pushing for mandatory labels of imports on footwear, textiles and other products into the EU, in line with the recent voted of the European Parliament.

While apparel producers have expressed their opposition, the final decision on the import labels will again be political. At the governmental level, the countries that oppose the anti-dumping duties are roughly the same that oppose the import labels.

Anyhow, the lifting of the anti-dumping duties is a welcome bonus for European shoe importers as they start selling their autumn-winter 2011 collections. It will be interesting to check out the reactions on the pricing front. Many had already decided to raise their prices or to lower their mark-ups for the collections sourced from China and Vietnam because of the rising value of the U.S. dollar and the rising cost of raw materials, Chinese labor and shipping. Others had been considering major shifts in production to other countries, mostly in the Far East. The lifting of the anti-dumping duties may change their attitudes.

?more in the next issue of Shoe Intelligence, including reactions that will be collected at the big Expo Riva Schuh Show fair starting at Riva del Garda this coming weekend.