The European Commission, the EU's executive, said it had evidence Chinese producers were exporting bags via a company called Xiamen Xingxia Polymers Co. Ltd.
The company is not subject to the same duties as other Chinese companies because it was previously judged to be less guilty of dumping, or exporting a product to the EU at a price lower than the domestic one.
"The Commission has at its disposal sufficient prima facie evidence that the anti-dumping measures on imports ... are being circumvented by means of reorganisation of patterns and channels of sales," the Commission said in its official journal on Friday.
Xiamen Xingxia Polymers was not immediately available for comment.
The investigation is one of a series of moves by Brussels to stop what it sees as unfair trading by Asian exporters.
Chinese and Thai plastic bags entering the EU have been subject to import duties of up to 28.8 percent for the past four years, since the EU found exporters were dumping goods in the EU market at illegally low prices.
China exports an estimated 350 million euros' ($450 million) worth of plastic sacks -- from shopping bags to bin liners -- to the European Union annually.
Xiamen Xingxia Polymers is one of about 100 exporters that in 2006 were deemed to be less guilty of dumping and were granted an 8.4 percent duty.
The European Union now has until May 2011 to decide whether Xiamen Xingxia is channeling plastic bags into the EU and to levy higher duties against it.
The investigation suggests plastic bag duties may be extended by several years beyond their scheduled expiry in 2011, according to a person familiar with the case.
Such a move would anger retailers such as British supermarket chains Tesco , Asda Stores and Sainsbury who want access to cheap Asian bags. (Reuters)
