G/SG/N/6/RUS/7  
 
21 March 2019 
(19-1755) Page: 1/2 
Committee on Safeguards  Original: English  
 
NOTIFICATION UNDER A RTICLE 12.1 (A) OF THE AGREEMENT  
ON SAFEGUARDS  ON INITIATION OF AN INV ESTIGATION  
AND THE REASONS FOR IT 
RUSSIAN FEDERATION  
(Welded tubes of stainless steel ) 
The following communication, dated 19 March 2019, is being circulated at the request of the 
Delegation of the Russian Federation . 
 
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1. Specify the date when the investigation was initiated  
 
The investigation was initiated on 4 March 2019.  
 
Public notice of the initiation of a safeguard investigation on imports of welded tubes of stainless 
steel imported into the customs territory of the Eurasian Economic Union was published on 
4 March  2019 on the official website of the Eurasian Economic Un ion  
(http://eec.eaeunion.org/ru/act/trade/podm/investigations/PublicDocuments/SG12_notice_initiatio
n.pdf) (hereinafter the Notice of initiation).  
 
ID number of investigation: SG -12. 
 
2. Provide the precise description of the product involved  
 
The product subject to the investigation is welded tubes of stainless steel (welded pipes and tubes 
of stainless steel with an outside diameter from 6 mm to 115 mm and a wall thickness from 0,4 mm 
to 6 mm and welded hollow profiles of stainless steel with an outside diameter  not exceeding 140  mm 
and a wall thickness from 0,4 mm to 6 mm).  
 
Welded tubes of stainless steel  are classified under the fo llowing codes  within the Common 
Commodity Nomenclature of Foreign Economic Activity of the Eurasian Economic Union : 
7306 40 200 9, 7306 40 800 1, 7306  40 800 8, 7306 61 100 9 and 7306 69 100 9 .  
 
3. Provide the reasons for the initiation of investigation  
 
The investigation was initiated on the basis of results of consideration of the application filed by 
Eurasian Economic Union (hereinafter Union) producers of welded tubes of stainless steel . 
 
The information in the application indicates that total imports of welded tubes of stainless steel  
increased in absolute terms. Total imports in absolute terms increased by 68,3  % in the period 
2015–2017; by 38,1 % in the first 9  months of 2018 compared with the first 9  months  of 2015 and 
by 41,4 % in the period 2015 –2018. The increase in imports appears to be the result of unforeseen 
developments such as the global overcapacity in steel making and trade measures adopted by a 
series of third countries during the last years in the context of that global overcapacity.  
 
There is also sufficient evidence in the application showing that imports of welded tubes of stainless 
steel are threatening to cause serious injury to the Union industry. The  volume of imports of welded G/SG/N/6/RUS/7  
 
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  tubes of stainless steel  has already had a negative im pact on the Union industry's pricing policy . In 
particular, the Union industry had to reduce its sales prices in the Union market in an attempt to 
maintain its market share. After losing its market share in the Union in 2017 compared with 2016 
by 5,9 perce ntage points (while import market share of welded tubes of stainless steel in the Union 
increased by 5,5 percentage points), in the first 9 months of 2018 the Union industry reduced its 
sales prices  by 1,7%, despite the increase in cost per unit of 2,4%.  
 
In addition, even though the import prices were throughout the period higher than the Union 
industry's sales prices, the price gap narrowed significantly in the period 2015 –2017 (by 31 ,0%), 
which was due to a decrease in price difference in 2017 compared with 2016 by 53 ,3%.  
 
In the first 9 months of 2018 compared with the same period of 2017 the difference between the 
Union industry's sales prices and the import prices increased, which, inter alia , was a consequence 
of the reduction of the Union industry's sales prices.  
 
As a result , production and financial indicators  of the Union industry  in the first 9  months of 2018  
compared with the first 9  months  of 2017 decreased ( sales revenue by 1,4%; pro fit by 10,5 times; 
production profitability by 4,2 percentage points; profitability of sales by 4,0  percentage points, 
investments by 72,3%, volume of production by 0,1% ). 
 
The state of the Union industry in the period 2015 –2017, and specifically in the fi rst 9 months 
of 2018, indicates that the Union industry is vulnerable to a further increase in imports, which is 
likely to be imminent given the context of an overall steel overcapacity, the increasing number of 
trade defence measures taken by third countr ies on steel products, ongoing safeguard 
investigations , the recent measures under Section 232 of the Trade Expansion Act of 1962 adopted 
by the United States of America, and, consequently, trade diversion.  
 
For more details on the reasons for the initiat ion of the investigation please refer to the Notice of 
initiation.  
 
4. Provide a point of contact for the investigation and identify the preferred means for 
corresponding  
 
Department for Internal Market Defence (DIMD)  
Eurasian Economic Commission  
3/5, Smolensky boulevard  
Moscow, 119121, Russia  
Tel +7 (495) 669 -24-00 # 1309, # 4966, #1272  
E-mail:  tradedefence@eecommission.org . 
 
5. Provide the deadlines and procedures for importers, exporters and other interested 
parties to present evidence and their views  
 
In accordance with the Protocol on Application of Safeguard, Anti -Dumping and Countervailing 
Measures to Third Countries (Annex №  8 to the Treaty on the Eurasian Economic Union 
of 29.05.2014), interested parties may declare their intention to seek participant status not later 
than 25 days from the date of initiation of the investigation. Participants to the safeguard 
investigation have the right to request access to the non -confidential file and  participate in public 
hearings.  
 
The participants to the safeguard investigation may request for public hearings within 45  days from 
the date of initiation of the investigation.  
 
Interested parties should submit comments within 60 days from the date of th e initiation of the 
investigation in writing in the Russian language to the following address:  
 
Department for Internal Market Defence (DIMD)  
Eurasian Economic Commission  
3/5, Smolensky boulevard  
Moscow, 119121, Russia  
E-mail: tradedefence@eecommission.org  
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