The renewal of a tariff wall erected by the European Commission to keep out cheap shoes from China and Vietnam was rejected by a key EU trade panel on Thursday.

Trade ministers from EU member states voted down the Commission’s proposal to extend anti-dumping duties put in place in 2006 to protect European footwear manufacturers from surges in imports from the Far East.

The duties were opposed by retailers, including the British Retail Consortium, which said that the duties had added £1.60 to the import cost of a pair of shoes and a total of £330 million a year to the cost to UK consumers of buying footwear.

The dispute over Asian imports has split the EU roughly between north and south with 15, mainly northern European states, including Britain, opposing the tariffs and ten states, including Mediterranean states, which have large leather-working industries, supporting the measures. Two member states abstained.

The Council of Ministers will decide next month whether to follow the trade representatives decision, which would mean repeal of the tariffs in January.

The anti-dumping measures — a 16.5 per cent duty on Chinese shoes and a 10 per cent tariff on Vietnamese footwear — were supported by the Commission, which said yesterday that it would still propose to the EU Council of Ministers that the duties be maintained.

A spokesman for Catherine Ashton, the EU Trade Commissioner, said: “We will take note of today’s vote and the reasons put forward by the member states before submitting our final proposal to ministers in December.”

The tariffs on footwear sparked a vigorous campaign from retailers and powerful manufacturers, such as Adidas and Nike which source their product from low-cost manufacturing countries, such as Vietnam.

Clothing and footwear makers in Europe suffered a severe shock in 2005 when an avalanche of clothing arrived in Europe from Asia.

The surge followed the final unravelling of a complex system of quotas that protected Europe from Asian imports.

According to EU figures, 1,000 footwear makers closed their doors, including many of Italy’s artisanal manufacturers.

In Britain, retailers celebrated the decision: “This is a major victory for customers, retailers and free trade. The EU’s argument that these shoes were being sold into Europe at below cost was always bogus cover for protecting inefficient producers at the expense of hard-pressed customers.”

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