The tariff preferences in FTAs do not apply automatically to all imports. Instead, importers can request to use the tariff preferences, but must then show that the imported goods fulfil the formal requirements (e.g. rules of origin) of the FTA. This is costly, which is a likely reason why tariff preferences are not always used. This research note examines preference utilization under the FTA between the EU and South Korea, which was formally ratified in 2015 (but had been provisionally applied from 2011). We use firm and transaction level data for Swedish imports from South Korea during November 2016 to answer the question ‘Who uses the EU's FTAs?’ With information on firm size, product category, import mode (direct imports or customs warehousing), preference margin, potential duty savings, and transaction size, we provide a detailed picture of when firms choose to utilize the tariff preferences. The results suggest that the differences across importers are not primarily related to firm size, as is sometimes suggested in extant literature. We also find that it is the size of the import transaction rather than the size of the preference margin that determines preference utilization.

Governments are increasingly entering FTAs and mega-regionals to secure market access for their firms. Utilization rates are used to monitor whether firms are using these FTAs. This paper is part of a recent stream of studies to dash out enduring myths that preferences are not used when preferential MFN rates are low or for unknown or vague reasons. Contrary to this sort of conventional wisdom this study advocates that low utilization rate is a valuable and unequivocal sign that reform of rules of origin and related administrative procedures is needed to make the FTA attractive and meaningful to the private sector. By using a "repeated offender" methodology this paper identifies a series of product specific rules of origin (PSROs) causing low utilization rates. Such PSROs are the candidate for reforms towards more lenient requirements that are commercially viable for firms.

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The European Union (EU) is one of the main users of the antidumping instrument. The EU is also a unique example of a regional trade agreement that has abolished the use of antidumping measures in force between the integrating parties. The chapter analyzes the effects on trade of imposing and abolishing antidumping measures in the EU based on empirical evidence. The imposition of antidumping measures is analyzed from the points of effectiveness, that is, if the protection is effective as regards EU producers, the exporters of allegedly dumped products and third country exporters; and efficiency, that is, the cost of protection for EU user industry and consumers. The abolition of antidumping measures is analyzed from the point of injury to EU producers when it comes to price undercutting and loss of market shares; and possible changes in the use of the antidumping instrument against third countries. The chapter also analyses the antidumping measures between the EU and the United States, as well as the experiences with abolishing antidumping measures in the EU and the European Economic Area (EEA) as an inspiration for the Transatlantic Trade and Investment Partnership (TTIP) negotiations.