Friday, October 6 2006 13:20 Hrs (IST) - World Time -

Beijing: China is dissatisfied with the European Union's (EU) decision to impose anti-dumping tariffs on imports of Chinese leather shoes and may take 'corresponding measures,' the Chinese Commerce Ministry said in a statement posted today (Oct 6,2006) on its website.

The EU decision to impose tariffs starting Saturday on leather shoes from China and Vietnam "lacks a legal basis and factual evidence" and fails to conform with EU and World Trade Organization anti-dumping rules, the statement quoted ministry spokesperson Chong Quan as saying Thursday.

"The Chinese side will closely watch this issue and evaluate developments and reserves right to take corresponding measures," Chong said.

The EU Council of Ministers approved the anti-dumping tariffs Thursday, confirming a decision Wednesday by EU member states to impose extra duties for two years, instead of the five years that the European Commission had called for previously.

The European Commission had said that Vietnam and China illegally subsidised manufacturers with measures like cut-rate land and electricity, giving the Asian producers an unfair advantage over European competitors.

The extra duties amount to 16.5 percent on leather shoes from China and 10 percent on similar products from Vietnam, said EU diplomats. The EU Commission proposed the new duties in August, claiming that both Asian countries distorted competition with subsidies.

As it is a dumping case, no restrictions on exports will be imposed. However, price increases are being anticipated by the shoe industry.