Recently, the EU members rejected the proposal of the European Commission to impose a formal system that would regulate any importer of leather shoes like Vietnam and China. The scheme was designed in order to replace emergency policies that were implemented last April. It must be noted that the temporary regulating system was applied by the EU due to allegations that imported shoes were being sold at lower prices in order to gain a bigger share in the European markets. At that time, the Commission stated that it was able to gather sufficient evidence that both China and Vietnam were subsidizing local shoe businesses in order to gain an unfair advantage in the EU markets. According to EU Trade Commissioner Peter Mandelson, the implementation of a formal regulating system was needed in order to protect all European manufacturers from any importer of cheaper goods such as shoe products.

The proposal was supported by shoe producers in member states like Italy, Poland, and Portugal. According to them, European shoe manufacturers had to deal with higher production costs unlike their East Asian competitors and thus could not compete with them in terms of pricing. However, the scheme was opposed by many retailers who argued that the system would force them to increase their prices, a situation that might result to the decrease of their revenues. The temporary policy imposed on any importer in the EU markets is due to expire in October.

The Commission, then, proposed a more formal system in order to regulate any importer from China or Vietnam. The policy needs at least 13 votes from the 25 members of the European Union. But getting such level of approval even proves to be hard. The Commission initially suggested the introduction of a quota system, which would allow 95 million pairs of imported shoes from Vietnam and 140 million from China.

Any importer that would exceed the quota would have to pay up to 29.5% of duties. However, the idea was opposed by the majority of the EU members. The opposition was headed by major shoe manufacturers such as Italy, Poland, and Portugal. Moreover, the proposed policy was questioned as regard its legality under the global trade standards.

After the proposal was rejected, the Commission came up with another scheme wherein 16.5% tariffs would be imposed on Chinese goods while 10% would be applied on Vietnamese products. However, that suggestion was also opposed by the EU members. Both Germany and Britain saw the duties as too harsh for any importer. A spokesman of Mr. Mandelson stated that the Commission would look for other alternative policies that would effectively protect European shoe businesses without being too harsh on any importer. Meanwhile, retailers welcomed the decision of the Commission. Particularly, Horst Widmann, the head of the Federation of European Sporting Goods Industries, said that EU members have realized that imposing anti-dumping duties on both Vietnam and China would not help any European business. Instead, it would only put at stake the interest of consumers and the competitiveness of EU markets, but also the credibility of international trade rules.