BRUSSELS, Belgium (AP) -- The European Union on Wednesday added trade charges of up to 40 percent to surging Chinese imports of the flavor enhancer MSG, saying Chinese companies were illegally selling below cost.
MSG, or monosodium glutamate, is added to soups, stocks, potato chips, instant noodles and other foods, adding a savory taste sometimes called ''umami.''
The EU said the antidumping duties -- which will last for an initial six months but can be extended for up to five years -- aimed to protect Europe's sole producer of MSG, the French subsidiary of Japan's Ajinomoto Co. Inc.
Under global trade rules, the EU has the right to charge trade tariffs on goods sold below cost that are damaging its industry, if an investigation bears out complaints by local producers.
In a notice published in the EU's official journal, trade officials said Chinese imports had increased by more than 600 percent since 2005, going from a market share of up to 7 percent to more than 40 percent by last year as overall sales shrank.
Chinese rivals undercut Ajinomoto by up to 24 percent last year, they said, as lost sales forced the European manufacturer to cut back output, risking the loss of European jobs.
Ajinomoto had worldwide sales of US$9.4 million (euro6.9 million) in 2006, well below the main Chinese MSG producer Shandong Linghua Monosodium Glutamate Co. Ltd., which reported US$36.5 million (euro26.86 million), according to Hoovers market research.
Chinese companies find it hard to defend themselves against European claims that they are illegally underselling their products because Europe refuses to recognize China as a market economy. The EU says the Chinese state sometimes pays normal business costs such as energy and rent or gives cheap loans.
The EU has looked into a host of complaints from European producers about imports of cheap goods from China but has only levied trade charges on a small number of high profile cases, such as leather shoes and plastic bags.
On Tuesday, it slapped duties on Chinese imports of citric acid, a natural food preservative and sour-tasting flavoring.
