This article summarizes the legal frameworks and procedural attributes of four emerging trade remedy tools in the EU and the U.S. and explores how developing economies may respond to these developments in light of prominent cases and our own practice.[1]

1. Anti-Circumvention as a Normalized Trade-Defense Instrument

1.1 The Origin of Anti-circumvention Measures

Both the U.S. and the EU anti-circumvention rules were originally intended to counteract so-called “screwdriver operations”, referring to the practices where minimal assembly occurred in a host country to make the assembled products appear to originate from said country and thus circumvent anti-dumping duties. The U.S. Omnibus Trade and Competitiveness Act of 1988[2] established Section 781 of the Tariff Act of 1930[3] to extend anti-dumping and countervailing duty (AD/CVD) orders to such practices, while the EU’s 1987 “Screwdriver Regulation”[4] and the 1988 basic anti-dumping regulation[5] laid the foundation for what is now Article 13 of Regulation (EU) 2016/1036.[6]

1.2 Different Frameworks between the EU and the U.S.

EU rules in Article 13 of the Anti-Dumping Basic Regulation and Article 23 of the Anti-Subsidy Basic Regulation[7] define circumvention, list four typical scenarios thereof, and regulate initiation, registration, and exemptions. The U.S. law under Section 781 covers four comparable categories (U.S./third-country assembly, minor alterations, and later-developed products) with procedures in 19 C.F.R. § 351.226.[8] To determine whether circumvention occurs, the EU analyzes four factors: (1) change in the trade pattern, (2) lack of due cause for such change, (3) undermining of measures, and (4) evidence of continued dumping or subsidy. Further, the EU has in place specific quantitative thresholds for assembly operations, mandating imported parts over 60% and local value added below 25% as criteria for potential circumvention finds—a refinement from the earlier 50% rule to distinguish sham assembly from commercially justifiable manufacturing arrangements.

1.3 Anti-circumvention Procedures: the EU vs. the U.S.

In the EU, the European Commission may initiate an anti-circumvention investigation ex officio, at a Member State’s request, or upon an interested party’s request, and normally wraps up such probes within nine months, using tools similar to standard AD investigations and allowing exemptions for individual cases. In the U.S., the Department of Commerce can self-initiate or act on a petition, with broadly similar methods to its EU counterpart but operating under tighter statutory timelines (preliminary in 150 days, final in 300 days). The International Trade Commission (ITC) also consults on these cases, whose views—as in the HFC case—and final determination can be outcome-determinative.

1.4 Notable Cases in the EU and the U.S.

In the EU graphite-electrode-system case,[9] the European Commission determined that there had been a shift from finished electrodes to artificial graphite, deemed EU assembly economically unjustified beyond duty avoidance, and confirmed the continuation of dumping practices, thus resulting in the extension of the anti-dumping measures to include the circumventing goods. In the corrosion-resistant steel case[10], the drastic decrease in import of the original product and surge in the influx of a slightly modified version, coupled with a new customs code, was deemed as strong evidence of circumvention. In the U.S. HFC case[11], Commerce initially covered only blends, later sought to pull components into scope under Section 781(a), but ultimately backed down after the ITC argued this would contradict its prior negative injury finding for components.

2. Anti-Evasion and the U.S. EAPA Framework

2.1 Overview of EAPA

This section focuses almost exclusively on the U.S. Enforce and Protect Act (EAPA), a powerful anti-evasion tool, to which the EU has no direct equivalent. Instead, customs fraud falls under the mandate of European Anti-Fraud Office (OLAF), which has a broader mission to handle customs fraud matters in general, and the investigative process is more flexible and less transparent compared to that of the U.S.

EAPA, enacted in 2015[12], serves as a “gap-filler” that gives U.S. Customs and Border Protection (CBP) a tailored tool to tackle new forms of duty evasion. The application of EAPA has seen sharp increase since its enactment. As of October 15, 2025, 421 EAPA cases had reached a determination. Of these cases, 287 involved goods from China, and the vast majority (382 cases) involved transshipment, with Malaysia being the most common transshipment jurisdiction. The volume of EAPA proceedings more than doubled in just 18 months.

2.2 Procedure of Anti-evasion Investigation

A core feature of EAPA is that CBP cannot self-initiate an investigation.[13] An allegation must be filed by an “interested party” as defined in the statue. The investigation then runs on “firm statutory clocks”: (1) Initiation: CBP has 15 business days to decide whether to initiate an investigation; (2) Interim Measures: By Day 90, if CBP finds “reasonable suspicion” of evasion, it must impose interim measures, such as suspending the liquidation of entries; (3) Final Determination: A final determination as to evasion is due within 300 days (or within 360 days in “extraordinarily complicated” cases).

2.3 Review and Key Legal Precedents

EAPA determinations are subject to a two-tiered review process. First, a party can request a de novo administrative review by CBP’s Office of Regulations and Rulings (ORR). ORR can, and does, reverse evasion findings, as seen in Case No.7356 involving shrimp from India. Following the ORR review, parties can seek judicial review at the U.S. Court of International Trade (CIT).

Judicial reviews of EAPA have established critical procedural guardrails. In the Royal Brush case: EAPA investigations have no APO (Administrative Protective Order) system. The Federal Circuit affirmed that to satisfy due process, CBP must provide parties with adequate public summaries of the confidential information being relied upon in its investigation. The All One God Faith case established that liquidation is “final and conclusive”. This creates a high-stakes tactical imperative: an importer must move the CIT for a temporary restraining order (TRO) or preliminary injunction (PI) to stop CBP from liquidating entries while the lawsuit is pending.

A recent EAPA case concerning Mobile Access Equipment (MAE) alleges a classic transshipment scheme: Chinese-origin MAE was allegedly assembled in Poland and “misrepresented as a product of Poland” to evade duties.

3. The EU’s Foreign Subsidies Regulation (FSR)

3.1 Overview of Foreign Subsidies Regulation

The FSR[14], a “landmark regulation” that entered into force in mid-2023, is perhaps the most innovative of these new tools. It was designed to “level the playing field” by closing a “regulatory gap”: subsidies from non-EU governments that gave foreign companies an unfair edge in the EU market.

The regulation’s novel power comes from extending subsidy scrutiny beyond trade and into the realms of investment, M&A, and government procurement.

3.2 Scope and Notification Thresholds

The FSR imposes mandatory, pre-closing notification requirements for: (1) concentrations (M&A): if the acquired company has a turnover of EUR 500 million or more, and the parties have been granted over EUR 50 million in combined aggregate foreign financial contributions in the prior three years; and (2) public procurement: if the contract value is EUR 250 million or more, and the bidder received at least EUR 4 million in foreign financial contributions in the last three years.

Critically, the Commission also has ex officio power to investigate any subsidy on its own initiative, regardless of whether a transaction meets these notification thresholds.

3.3 Procedure and the “Balancing Test”

The FSR investigation operates on extremely short timeframes. If an in-depth (Phase II) investigation is initiated, the Commission applies a “balancing test”. This test weighs the negative effects of the subsidy on competition against any positive effects on economic development, such as contributions to the green transition, R&D, or job creation.

Following this test, the Commission can issue a decision of no objection, prohibit the transaction, or accept commitments or redressive measures. These remedies can be structural (e.g., divesting assets) or behavioral (e.g., repaying the subsidy with interest).

3.4 Case Studies

The e&/PPF Telecom[15]: This was the first merger case decided under the FSR. It involved a UAE state-backed firm and was conditionally approved subject to the first-ever FSR remedies, which addressed a distortive state guarantee.

4. Forced-Labor-Related Trade Instruments

4.1 Overview of Forced-Labor-Related Trade Instruments

The final set of trade instruments is driven by human rights and ethical concerns rather than pricing issues or subsidy-related matters. These measures, which target goods made with forced labor, employ strategies like import bans and customs enforcement, mirroring the approach of conventional trade remedies.

4.2 The United States Approach (UFLPA)

While the U.S. has long prohibited forced labor imports under Section 307 of the Tariff Act of 1930[16], enforcement was historically weak. The Uyghur Forced Labor Prevention Act (UFLPA)[17] has “dramatically” changed this.

The UFLPA rests on four key pillars: (1) a rebuttable presumption that goods from certain regions or entities are inadmissible; (2) an Entity List of firms whose products are automatically presumed banned; (3) CBP enforcement at ports of entry; and (4) a focus on high-risk sectors like electronics, apparel, and agriculture.

Under this system, the burden of proof is on the importer to demonstrate full supply-chain traceability. Enforcement data shows this now heavily impacts global supply-chain hubs, with suppliers in Malaysia, Viet Nam, and Thailand being significantly affected.

4.3 The European Union Approach (FLR)

The EU’s Forced Labour Regulation (FLR)[18] “takes a different route”. It bans all forced-labor-linked goods, whether produced domestically or imported.

Key differences of FLR from the U.S. model include: (1) no geographical presumptions; (2) a risk-based, case-by-case enforcement model grounded in ILO standards; (3) a central role for the European Commission in screening imports; and (4) a three-year transition period for businesses to adapt to their due-diligence systems.

4.4 Comparing the U.S. and the EU Models

The U.S. model is described as “blunt and immediate”, where goods are “presumed guilty until proven innocent”. This has sweeping impacts but can risk affecting compliant companies. The EU model is, on the other hand, “more investigative”, offering more case-specific assessment.

For exporters, this distinction in approaches would translate into a dual-track compliance strategy: container-level traceability for the U.S. and broader human-rights due-diligence systems for the EU.

5. Summarization of the Four Trade Remedy Tools

5.1 Anti-circumvention

First, anti-circumvention investigations have spread beyond the United States and the European Union to emerging economies, with increasing frequency of enforcement and progressively refined rules. Second, as investigations are increasingly centered on typical scenarios, notably assembly or transshipment through third countries, minor alterations of merchandise. Third, with the evidentiary basis shifting toward the use of trade flow data and network models for risk identification, supporting more targeted initiation of investigations. Finally, the process of anti-circumvention inquiries has become more standardized and predictable, though this has also increased compliance costs for investigated parties.

5.2 Anti-evasion

EAPA investigations are governed by strict statutory timelines, which means almost every tactical decision from the moment an allegation arises is informed by the pressing schedule. Although the procedural timeline is set out in law, there are loopholes that warrant attention. For OLAF investigations, enforcement tends to be more flexible and less transparent. In trade remedy matters, protecting corporate information is critical. Companies should implement tiered confidentiality controls and strengthen day-to-day internal risk management. Administrative remedies are important, but timely and strategic use of judicial relief can prevent irreversible damage like liquidation. The cases outlined in this part are best examples in which judicial remedies play an important role.

5.3 EU Foreign Subsidies Regulation

Developing country trade authorities and companies must adapt to this new reality.

• Subsidy Audit: Developing country companies planning investments or bids in the EU should disclose every financial contribution received from their government (or other states) over at least the last three years. Having a clear record ensures accurate FSR notifications and helps anticipate concerns.

• Notification Readiness: Assess FSR thresholds for any deal. Build notification capability (data gathering, legal counsel) in advance to avoid delays.

• Timing & Due Diligence: Advise companies to factor in FSR review timelines (which can be several months) when structuring deals involving the EU. Conduct due diligence on subsidy implications early.

• Engage with EU Process: Encourage proactive communication with the Commission. If under investigation, companies should cooperate fully and consider proposing remedies (commitments) to address competition concerns. Global South authorities can support their firms by clarifying the purpose of subsidies or negotiating adjustments that satisfy EU requirements.

• Training and Guidance: Train local enterprises on FSR compliance. Regulators in developing countries might establish helpdesks or guidelines explaining the FSR.

5.4 Forced-Labor-Related Trade Instruments

Unlike traditional trade remedies that focus on pricing or subsidies, these measures are driven by human rights and ethical considerations, but they still significantly affect trade flows. The U.S. and EU approaches to forced labor in trade share the same goal but take different routes. For businesses, this means navigating both: in the U.S., focus on robust traceability for every container; in the EU, prepare to show regulators your comprehensive due diligence and be ready to engage if scrutinized. A clear trend emerges—zero tolerance for forced labor is on the rise, prompting swift advancements in legal mechanisms to stop goods made by forced labor from entering major economies. Businesses, especially those in the Global South exporting to these markets, need to stay abreast of each country’s regulatory requirements in order to ensure compliance. 

[Note] 

[1]本文基于李斯律师受邀为亚非拉高级贸易调查人员培训班授课内容整理。

[2]Pub. L. 100-418, 102 Stat. 1107 (Aug. 23, 1988).

[3]Tariff Act of 1930, § 781, codified at 19 U.S.C. § 1677j.

[4]Council Regulation (EEC) No 1761/87, Official Journal L 167, 26.6.1987, p. 9–10.

[5]Council Regulation (EEC) No 2423/88, Official Journal L 209, 2.8.1988, p. 1–17.

[6]EUR-Lex CELEX 32016R1036: OJ L 176, 30.6.2016, p. 21–54.

[7]EUR-Lex CELEX 32016R1037 ; OJ L 176, 30.6.2016, p. 55–91.

[8]19 C.F.R. § 351.226 (Procedures for scope and anti-circumvention inquiries).

[9]OJ L 108, 7.4.2022, p. 20–49.: OJ L 2025/01202.

[10]OJ L 207, 10.8.2017, p. 1–28.: OJ L 304, 26.11.2019, pp. 10–15.: OJ L 255, 5.8.2020, pp. 36–48. 

[11]HFC Blends from China, 81 Fed. Reg. at 42,314 (A-570-028).

[12]Trade Facilitation and Trade Enforcement Act of 2015, Pub. L. 114-125, Title IV, §§ 401–433.

[13]https://www.cbp.gov/trade/eapa?utm_%E3%80%82com.

[14]Regulation (EU) 2022/2560, OJ L 330, 23.12.2022, p. 1–45.

[15]Case FS.100011 – e&/PPF Telecom Group (FSR case register); Commission Press Release IP/24/4842, 10 June 2024.

[16]19 U.S.C. § 1307 – Convict-made goods; forced labor.

[17]Uyghur Forced Labor Prevention Act, Pub. L. 117-78, 135 Stat. 1525 (Dec. 23, 2021).

[18]EUR-Lex CELEX 52022PC0453.