WORLD TRADE
ORGANIZATIONG/SG/N/8/BGR/1
24 May 2002
(02-2868)
Committee on Safeguards Original:  English
NOTIFICATION UNDER ARTICLE 12.1(B) OF THE
AGREEMENT ON SAFEGUARDS ON FINDING A SERIOUS INJURY
OR THREAT THEREOF CAUSED BY INCREASED IMPORTS
BULGARIA
The following communication, dated 13 May 2002, has been received from the Permanent
Mission of the Republic of Bulgaria.
_______________
Pursuant to Article 12.1(b) of the WTO Agreement on Safeguards and taking into account the
suggested format for notifications under that Article (G/SG/W/1), the Republic of Bulgaria provides
notification to the Committee on Safeguards on finding of a serious injury or threat thereof caused byincreased imports.
On 11 February 2002, the Inter-Agency Comm ission on Safeguard Measures on Imports of
Products in the Republic of Bulgaria reached affirmative determination under Article 6(2) of
Regulation No. 300 of the Council of Ministers of 16 December 1996 that crown corks are imported
in substantially increased quantities, thus causing serious injury to the domestic producers.
The initiation of the investigation that led to this determination was notified to the Committee
on Safeguards in G/SG/N/6/BGR/2 (22 November 2001).
1. Provide evidence of serious injury or threat thereof caused by increased imports
Imports of crown corks for the year 1999 increased by 673 per cent compared to 1998.
Imports of crown corks for 2000 increased by 874 per cent as compared to 1999.
The increased volume of imports contributed significantly to domestic products’ price decline
and to reduced profitability.
Comparison between average production costs of 1000 pieces crown corks and sale prices on
the domestic market in 2001 indicates selling by Bulgarian producers below production cost.  These
prices cannot be further reduced taking into consideration the fixed costs for semi-manufacture, raw
materials, energy, depreciation and wages.  The share of fixed costs is illustrated below:
1998 1999 2000 2001
Average domestic prices excluding VAT,
BGL/1000 pce7.46 7.61 7.31 6.94
Share of fixed costs – average for
Bulgarian producers (%)83.4 90.7 91.4 89.1G/SG/N/8/BGR/1
Page 2
Domestic producers have suffered substantial losses from reduced capacity utilization,
notwithstanding the fact that in 1999 there was certain increase.  Low capacity utilization increases
the unit cost of production.  Production capacity of the producers who have submitted an application
and capacity utilization are given in the table below:
1998 1999 2000 2001
Total capacity (1000 pce) 2,480,000 2,480,000 2,480,000 2,480,000
Total capacity utilization of the
complainants (%)32.48 34.72 30.92 16.70
Following the decreased capacity utilization from 32.48 per cent to 16.70 per cent over the
period 1998-2000, the number of employed workers in the domestic industry also decreased.
A detailed report on the conclusions of the investigation and findings is to be submitted to the
Committee on Safeguards.
2. Provide information on whether there is an absolute increase in imports or an increase in
imports relative to domestic production (please see also Article 2.1 for the context)
The competent authority has found that there was a substantial increase in imports of crown
corks in absolute terms and compared to domestic consumption.
Quantity, 1000 pce Value, 1000 USD
1998 1999 2000 2001 (I-XI) 1998 1999 2000 2001 (I-XI)
2,184 14,700 128,478 248,766 11,1 58,4 352,2 651,4
Market share of imported products increased.  The share of imports in total sales increased
from 1.73 per cent in 1999 to 38.80 per cent in 2001.
The share of imports relative to production and consumption rose sharply.
1998 1999 2000 2001
Sales on the domestic market –
complainants + imports (1000 pce)778,118 847,441 884,059 641,224
Share of complainants (%) 99.72 98.27 85.47 61.20
Market share of imports (%) 0.28 1.73 14.53 38.80
Share of complainants (1000 pce) 775,934 832,741 755,581 392,458
Market share of imports (1000 pce) 2,184 14,700 128,478 248,766
3. Provide precise description of the product involved
Crown corks (tariff No. 8309100000 under the Customs Tariff of the Republic of Bulgaria)
are made from white tinplate and are used for glass bottles.
4. Provide precise description of the proposed measure
The proposed measure is an additional specific duty of 1.5 EURO per 1000 pce.G/SG/N/8/BGR/1
Page 3
5. Provide proposed date of introduction of the measure
As soon as the Council of Ministers approves the imposition of the safeguard measure and the
respective Regulation of the Council of Ministers is published in the State Gazette.
6. Provide expected duration of the measure
Proposed duration of four years.
7. For a measure with a duration of more than three years, provide the proposed date for the
review (under Article 7.4) to be held not later th an the mid-term of the measure, if such a date
for the review has already been scheduled
The date for the review under Article 7.4 is not specified.  It is proposed that such a review
will be held immediately after the expiration of the second year of the measure.
8. If the expected duration is over one year, provide expected timetable for progressive
liberalization of the measure
Proposed timetable for progressive liberalization of the measure:
- 1.5 EURO per 1000 pce for the first and second year after the imposition;
- 1.3 EURO per 1000 pce for the third and fourth year after the imposition.
__________