Morocco's Assertive Stance on Commercial Defense Measures

In today's increasingly globalized trade landscape, Morocco's Ministry of Industry and Commerce is strengthening its control over industrial product imports and actively invoking commercial defense mechanisms at the growing behest of economic operators. This approach aligns with the rules of international trade and Morocco's commitments to foreign partners.

These measures combat unfair practices like dumping and subsidies, as well as safeguards triggered to curb a sudden, massive surge in imports of a given product, posing a severe threat to the domestic industry manufacturing the same product.

During the sixth review of Morocco's trade policy at the World Trade Organization (WTO) in Geneva on April 22 and 24, the kingdom reaffirmed its pro-free trade stance, openness to foreign direct investment (FDI), and commitment to reducing tariff barriers, a process accelerated since the last review in 2016.

In its written contribution, Morocco emphasized that its legislative framework governing commercial defense has remained unchanged, with the sole aim of correcting or eliminating damages caused to productive sectors by unfair import competition practices. The WTO report did not raise particular concerns about these provisions, which are standard among states.

As Morocco increasingly positions itself as a regional commercial powerhouse and global industrial player, significant efforts have been made in recent years to bolster the country's commercial defense shield.

Ryad Mezzour, Minister of Industry and Commerce, candidly acknowledged the need for a robust commercial defense, stating, "We were naive about globalization." He encouraged companies facing unfair foreign competition to approach his department for necessary action.

This tightening is justified by the sharp global rise in dumping practices, with nearly 3,000 anti-dumping measures currently in force worldwide. Each year, hundreds of new measures are instituted, driven by increasing adoption of these tools by not only developed nations but also developing countries like China, India, Brazil, South Africa, Turkey, and Argentina.

Morocco can no longer afford an ineffective commercial defense, given its fragile industrial fabric despite efforts under the Industrial Acceleration Plan. "Commercial defense is an integral part of Morocco's trade policy and falls under the purview of the Ministry of Industry and Commerce," explained Abdeslam Touhami, an economist.

In recent months, the Import Monitoring Commission has been inundated with requests from major Moroccan companies and professional federations seeking commercial defense measures against dumping, subsidies, or a massive surge in imports posing a serious threat of injury.

For instance, Les Conserves de Meknès, Les Conserveries Marocaines DOHA, and Moroccan Food Processing, through the National Agri-Food Federation (FENAGRI), filed a request leading to an anti-dumping investigation on tomato preserve imports from Egypt. The ministry determined that Egyptian imports had increased remarkably, negatively impacting domestic production, consumption, and pricing.

Similarly, two Moroccan electric oven manufacturers, Deha Electromenager and Sultangaz, representing 100% of national production, prompted an anti-dumping investigation on imports from Turkey initiated on August 30, 2023.

On February 20, Morocco notified the WTO Committee on Safeguards of an investigation into coated wood fiber panels, following a request from CEMA Bois de l'Atlas (CBA), the national coated wood panel producer branch impacted by a steep rise in imports over the past two years.

Moreover, after a 12-month inquiry, the ministry extended anti-dumping duties on PVC imports from the European Union, the United Kingdom, and Mexico, following a request from the Société Nationale d'Électrolyse et de Pétrochimie (SNEP), a major Moroccan PVC producer.

The ministry also launched an inquiry on December 19 to review anti-dumping duties applied to imported Tunisian school notebooks, following requests from three Moroccan producers seeking an extension of the measure implemented in January 2019 and set to expire in January 2024.

From 2012 to the present, the Ministry of Industry and Commerce has implemented no fewer than 36 measures to address market distortions, with the WTO noting 11 initial inquiries opened between 2016 and 2023, six leading to final decisions with duty imposition, and two closed investigations.

While anti-dumping and countervailing measures are similar in operation, the latter are not applied in Morocco due to technical difficulties in demonstrating the existence of foreign subsidies.

Mezzour acknowledged that export subsidies and monetary dumping practiced by certain countries have harmed Morocco's industry, adding, "We also subsidize our industry. Otherwise, what is the purpose of the Investment Charter?"

Ibrahim Sellak, Director General of Ecodef, a leading Moroccan consultancy specializing in assisting industrialists and professional associations with commercial defense measures, noted the evolving landscape. While companies and associations previously struggled to file admissible cases with the ministry, the situation has significantly improved. However, challenges remain, particularly for less organized industrial branches unable to effectively defend themselves, even when victimized.

Sellak's firm collaborates with a Brussels-based law firm specializing in WTO law, addressing Morocco's shortage of lawyers specialized in commercial defense.

The implementation of Law No. 15-09 poses complexities, according to Larbi Jaidi, an economist and Senior Fellow at the Policy Center for the New South. While largely compliant with multilateral provisions, operationalizing the rules, institutional organization, and adherence to procedures present challenges requiring careful navigation by the Import Monitoring Commission and the competent authority.

As Morocco solidifies its position on the global trade stage, its assertive stance on commercial defense measures signals a commitment to protecting domestic industries from unfair practices while upholding international trade rules and obligations.