# EUR-Lex - 52013PC0811 - EN

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# 52013PC0811

**Proposal for a COUNCIL REGULATION repealing the anti-dumping measures on imports of certain iron or steel ropes and cables originating in the Russian Federation following an expiry review pursuant to Article 11(2) of Regulation (EC) No 1225/2009 /* COM/2013/0811 final - 2013/0395 (NLE) */**

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EXPLANATORY MEMORANDUM

1.           CONTEXT OF THE PROPOSAL

· Grounds for and objectives of the proposal

This proposal concerns the application of
Council Regulation (EC) No 1225/2009 of 30 November 2009 on protection against
dumped imports from countries not members of the European Community ('the basic
Regulation'), and in particular Articles 9(2) and 11(2) thereof in the expiry review
proceeding of the anti-dumping duty in force on imports of steel ropes and
cables originating in the Russian Federation.

· General context

This proposal is made in the context of the
implementation of the basic Regulation and is the result of an investigation
which was carried out in line with the substantive and procedural requirements
laid out in the basic Regulation.

· Existing provisions in the area of the proposal

The measures currently in force were imposed by
Council Regulation (EC) No 1601/2001 on
imports of steel ropes and cables originating, inter alia, in the Russian
Federation and have been confirmed in October 2007, following an expiry review
request lodged by the majority of the EU producers of the product concerned.

· Consistency with the other policies and objectives of the Union

Not applicable.

2.           CONSULTATION OF INTERESTED
PARTIES AND IMPACT ASSESSMENT

· Consultation of interested parties

Interested parties concerned by the proceeding
have had the possibility to defend their interests during the investigation, in
line with the provisions of the basic Regulation.

· Collection and use of expertise

There was no need for external expertise.

· Impact assessment

This proposal is the result of the
implementation of the basic Regulation.

The basic Regulation does not foresee a general
impact assessment but contains an exhaustive list of conditions that have to be
assessed.

3.           LEGAL ELEMENTS OF THE
PROPOSAL

· Summary of the proposed action

On 27 October 2012, the Commission initiated the
second expiry review of the anti-dumping measures applicable to imports of
steel ropes and cables originating in the Russian Federation. The attached
proposal for a Council Regulation is based on the findings that it is not
likely that injury would reoccur if the measures were allowed to lapse.

It is therefore proposed that the Council adopt
the attached proposal for a Regulation terminating the proceeding and repealing
the existing measures on imports of steel ropes and cables originating in the Russian
Federation.

· Legal basis

This proposal concerns the application of Council
Regulation (EC) No 1225/2009 of 30 November 2009 on protection against dumped
imports from countries not members of the European Community.

· Subsidiarity principle

The proposal falls under the exclusive
competence of the Union. The subsidiarity principle therefore does not apply.

· Proportionality principle

The proposal complies with the proportionality
principle for the following reasons:

The form of action is described in the
above-mentioned basic Regulation and leaves no scope for national decision.

Indication of how the financial and
administrative burden falling upon the Union, national governments, regional
and local authorities, economic operators and citizens is minimized and
proportionate to the objective of the proposal is not applicable.

· Choice of instruments

Proposed instruments: Regulation.

Other means would not be adequate for the
following reason: The above-mentioned basic Regulation does not foresee
alternative options.

4.           BUDGETARY IMPLICATION

The proposal has no implication for the Union
budget.

2013/0395 (NLE)

Proposal for a

COUNCIL REGULATION

repealing the anti-dumping measures on
imports of certain iron or steel ropes and cables originating in the Russian
Federation following an expiry review pursuant to Article 11(2) of Regulation
(EC) No 1225/2009

THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty on the Functioning
of the European Union,

Having regard to Council Regulation (EC) No
1225/2009 of 30 November 2009 on protection against dumped imports from
countries not members of the European Community[1]
(the ‘basic Regulation’), and in particular Articles 9(2) and 11(2) thereof,

Having regard to the proposal submitted by
the European Commission ('the Commission') after consulting the Advisory
Committee,

Whereas:

A. PROCEDURE

1.           Measures
in force

(1)       By Regulation (EC) No 1601/2001[2] the
Council imposed a definitive anti-dumping duty on imports of certain iron or
steel ropes and cables (SWR) originating in the Russian Federation, Turkey,
Thailand, and the Czech Republic. These measures will
hereinafter be referred to as 'the original measures' and the investigation that
led to those measures will be hereinafter referred to as 'the original
investigation'.

(2)       The Commission had
accepted in August 2001 a price undertaking offer by a Russian producer (JSC
Severstal-Metiz). This undertaking agreement was repealed in October 2007[3] because it was considered as
not workable due to difficulties in the proper classification of the large
number of product types exported by the company.

(3)       By
Regulation (EC) 1279/2007[4] the Council, following partial interim and expiry reviews, maintained
the original measures for the Russian Federation in accordance with Article
11(2) of the basic Regulation. These measures will hereinafter be referred to
as 'the measures in force' and the expiry review investigation will be
hereinafter referred to as 'the last investigation'. The same Regulation terminated the measures concerning
imports of steel ropes and cables originating in Turkey and Thailand.

(4)       Currently[5], there are also measures in force against SWR from Ukraine and the
People’s Republic of China, which were extended to imports of SWR consigned
from Morocco, Moldova and the Republic of Korea.

2.           Request for a review

(5)       On 27 October 2012, the
Commission announced by a notice published in the Official Journal of the
European Union the initiation of an expiry review ('notice of initiation')[6] of the anti-dumping measures
applicable to imports of SWR originating in the Russian Federation pursuant to
Article 11(2) of the basic Regulation.

(6)       The review was initiated
following a substantiated request lodged by the Liaison Committee of European
Union Wire Rope Industries (hereafter referred to as ‘EWRIS’ or ‘the applicant’)
on behalf of Union producers representing more than 50%, of the total Union
production of certain iron or steel ropes and cables. The request was based on
the grounds that the expiry of the measures would be likely to result in
continuation of dumping and recurrence of injury to the Union Industry ('UI').

3.           Investigation

3.1.        Review investigation period
and period considered

(7)       The investigation of
continuation or recurrence of dumping and injury covered the period from 1
October 2011 to 30 September 2012 (RIP). The examination of the trends relevant
for the assessment of a likelihood of a continuation or recurrence of injury
covered the period from 1 January 2009 until the end of the RIP (period
considered).

3.2.        Parties concerned by the
proceedings

(8)       The Commission officially
advised the exporting producers, Union producers, importers and users known to
it as well as the applicant and the authorities of the exporting country.
Interested parties were given the opportunity to make their views known in
writing and to request a hearing within the time-limit set out in the notice of
initiation.

(9)       In view of the potentially
large number of exporting producers in the Russian Federation involved in the
investigation, sampling was initially envisaged in the notice of initiation in
accordance with Article 17 of the basic Regulation. In order to enable the
Commission to decide whether sampling would be indeed necessary and, if so, to
select a sample, exporting producers from the Russian Federation were
requested, to make themselves known within 15 days from the initiation of the
proceeding and to provide the Commission with the information requested in the
notice of initiation.

(10)     Given that only two exporting producers in the Russian
Federation provided the information requested in the notice of initiation and
expressed their willingness to further cooperate with the Commission, it was
decided not to apply sampling for exporting producers.

(11)     The Commission announced in
the notice of initiation that it had provisionally selected a sample of Union
producers and invited interested parties to comment thereupon within a deadline
provided for in the notice of initation. The provisional sample consisted of five
Union producers that were found to be representative of the Union industry in
terms of volume of production and sales of the like product in the Union.

(12)     In the absence of any comments,
the proposed companies were selected to be included in the final sample and
interested parties were accordingly informed. However, one of the finally
selected companies subsequently withdrew from the sample.
The Commission therefore decided to reduce the sample to the four remaining companies,
which were still found to be representative of the Union industry in terms of
volume of production (29.3%) and sales (20.9%) of the like product in the
Union.

(13)     Although
sampling was envisaged in the notice of initiation of unrelated importers, neither
any unrelated importer nor any user came forward. Therefore,
sampling was not applied to unrelated importers.

(14)     Questionnaires were sent to
the four sampled Union producers, the two exporting producers in the Russian
Federation, and the related importer.

3.3.        Questionnaire replies

(15)     Replies
to the questionnaires were received from the four sampled Union producers, from
the related importer and from one exporting producer from the Russian
Federation.

(16)     Although two exporting
producers from the Russian Federation had originally come forward, only one of
them provided a reply to the questionnaire and is
considered to be cooperating in the investigation. The cooperating exporting
producer has a wholly owned subsidiary based in Italy, which also produces SWR
and imports the product concered from the Russian Federation. The other exporting
producer provided a submission at the time of the initiation of the
investigation and although was invited to fill in a questionnaire, failed to do
so. It is therefore considered that the second exporting producer did not
cooperate in the investigation.

3.4.        Verification visits

(17)     The Commission sought and
verified all information it deemed necessary for the purpose of determining the
likelihood of continuation or recurrence of dumping and resulting injury and of
the Union interest. Verification visits were carried out at the premises of the
following companies:

a) Union producers:

– 
CASAR Drahtseilwerk Saar GmbH, Germany,

– 
BRIDON International Ltd. United Kingdom,

– 
TEUFELBERGER Seil GmbH, Austria,

– 
Manuel Rodrigues de OLIVEIRA Sá & Filhos, S.A.,
Portugal;

b) Exporting producer in the Russian
Federation:

– 
JSC SEVERSTAL-Metiz, Cherepovets;

c) Related importer:

– 
REDAELLI Tecna SpA, Italy.

B. PRODUCT CONCERNED AND LIKE
PRODUCT

1.           Product concerned

(18)     The
product concerned is the same as that in the original investigation and in the
last investigation, which led to the imposition of measures currently in force,
i.e. iron and steel ropes and cables, including locked coil ropes, excluding
ropes and cables of stainless steel, with a maximum cross-sectional dimension
exceeding 3 mm, with fittings attached or not (in industry terminology often
referred to as 'SWR'), currently falling within CN codes ex 7312 10 81, ex 7312
10 83, ex 7312 10 85, ex 7312 10 89 and ex 7312 10 98 (the 'product
concerned').

2.           Like product

(19)     The
current expiry review investigation confirmed that SWR produced in the Russian
Federation and exported to the Union, and SWR produced and sold in the Union by
the Union producers have the same basic physical and technical characteristics
and end uses and are therefore considered to be like products within the
meaning of Article 1(4) of the basic Regulation.

C.        LIKELIHOOD OF A
CONTINUATION OR RECURRENCE OF DUMPING

1.           Preliminary remarks

(20)     In accordance with Article
11(2) of the basic Regulation, it was examined whether dumping was currently
taking place and whether the expiry of the existing measures would be likely to
lead to a continuation or recurrence of dumping.

(21)     As explained above in
recital (10), it was not necessary to select a sample of exporting producers in
the Russian Federation. The cooperating exporting producer accounted for 99% of
the exports of the product concerned from the Russian Federation to the Union
during the RIP. On this basis, it was concluded that cooperation was high.

(22)     Since two other known
producers in the Russian Federation did not cooperate in the investigation, the
findings on the likelihood of continuation or recurrence of dumping set out
below had to be based on the best available facts including Eurostat data, the
Russian official statistics and limited data obtained from a second producer.

2.           Dumping of imports during
the RIP

(23)     According to the request
for review, the exports from the Russian Federation into the Union were
allegedly dumped at an average margin of 130.8%. As mentioned in the notice of
initiation (paragraph 4.1), the applicant compared the export prices from the
Russian Federation to the Union (at ex-works level) with the domestic prices in
the Russian Federation.

2.1.        Normal value

(24)     In accordance with Article
2(2) of the basic Regulation, it was first established for the cooperating
exporting producer whether its total domestic sales of the like product to
independent customers in the Russian domestic market were representative, i.e.
whether the total volume of such sales was equal to at least 5% of the total
volume of the corresponding export sales to the Union. The domestic sales of
the like product by the cooperating exporting producer were found to be overall
representative.

(25)     Subsequently, the
Commission identified those types of the like product sold domestically by the
exporting producer which were identical or directly comparable to the types
sold for export to the Union.

(26)     It was further examined
whether the domestic sales of the cooperating exporting producer were
representative for each product type, i.e. whether domestic sales of each
product type constituted at least 5% of the sales volume of the same product
type to the Union. For the product types sold in representative quantities it
was then examined whether such sales were made in the ordinary course of trade
(‘OCOT’), in accordance with Article 2(4) of the basic Regulation.

(27)     The examination as to
whether the domestic sales of each product type, sold domestically in
representative quantities, could be regarded as having been made in the OCOT
was made by establishing the proportion of the profitable sales to independent
customers of the type in question. In all cases where the domestic sales of the
particular product type were made in sufficient quantities and in the OCOT,
normal value was based on the actual domestic price, calculated as a weighted
average of all the domestic sales of that type made during the RIP.

(28)     For the remaining product
types where domestic sales were not representative or not sold in the OCOT,
normal value was constructed in accordance with Article 2(3) of the basic
Regulation. Normal value was constructed by adding to the manufacturing costs
of the exported types, adjusted where necessary, a reasonable percentage for
selling, general and administrative expenses and a reasonable margin for
profit, on the basis of actual data pertaining to the production and sales of
the like product in the OCOT, in accordance with the first sentence of Article
2(6) of the basic Regulation.

2.2.        Export price

(29)     For export sales to the
Union market of the cooperating Russian exporting producer made directly to the
independent customers, the export price was established on the basis of the
prices actually paid or payable for the product concerned in accordance with
Article 2(8) of the basic Regulation.

(30)     For the export transaction
where the export to the Union was made through a related trading company, the
export price was established on the basis of the first resale price of the
related trader to independent customers in the Union, pursuant to Article 2(9)
of the basic Regulation. Adjustments were made to take account of all the costs
incurred between the importation and resale, and for profit, to establish a
reliable export price. In the absence of information from independent importers
concerning the level of profits accrued during the RIP, an average profit
margin of 5% was used.

2.3.        Comparison

(31)     The comparison between the
weighted average normal value and the weighted average export price was made on
an ex-works basis and at the same level of trade.

(32)     In order to ensure a fair
comparison between normal value and the export price, account was taken, in
accordance with Article 2(10) of the basic Regulation, of differences in
factors which were demonstrated to affect prices and price comparability. For
this purpose, due allowance in the form of adjustments was made for differences
in transport, insurance, handling, loading and ancillary costs, financial
costs, packing costs, commissions and rebates where applicable and justified.

2.4.        Dumping margin

(33)     As
provided for under Article 2(11) of the basic Regulation, the weighted average
normal value by type was compared with the weighted average export price of the
corresponding type of the product concerned. This comparison showed the
existence of dumping which amounted to 4.7% for the exporting producer.

3.           Developments of imports
should measures be repealed

3.1.        Preliminary remarks

(34)     Further to the analysis of
the existence of dumping during the RIP, the likelihood of the continuation of
dumping should measures be repealed was also investigated. In this respect the
following elements were analysed: the volume and prices of dumped imports from the
Russian Federation, the attractiveness of the Union market and other third
country markets, production capacity and excess capacity for exports in the
Russian Federation.

3.2.        Volume and prices of dumped
imports from the Russian Federation

(35)     According
to Eurostat, during the period considered, the imports from the Russian
Federation increased from 2 005 tonnes in 2009 to 2 343 tonnes in the RIP
representing around 1% of the Union consumption in the RIP and in the period
considered. As mentioned above in recital (33), the imports from the cooperating exporting producer were made at
dumped prices (4.7%) despite the anti-dumping duty in force.

3.3.        Attractiveness of the Union
market and other third country markets

(36)     The
exports to the Union constituted 3% of the total sales of the cooperating
producer, while the majority of the sales (85%) were made on the Russian domestic
market. The domestic market grew by 38% in the period considered[7] and may further grow should the GDP of the Russian Federation
continue to grow, as forecasted by publically available sources specialising on
economic analysis. Moreover, the information gathered during the investigation
revealed that the cooperating producer does not produce all types of the
product concerned and therefore its competitive pressure on the Union producers
is limited. This is likely to be the case also for the two other producers in
view of no available information on the investments in new machinery, which
could for instance allow the production of the product concerned of a bigger
diameter. Furthermore, the limited competitive pressure of the exporting
producers from the Russian Federation seems also be confirmed by the presence
of the Union producers on the Russian market. According to the official Russian
customs statistics the Union producers' exports of the like product to the
Russian Federation represented 30% of all imports of the like product to the
Russian market in RIP, making of the Union producers the largest exporter on
the Russian market.

(37)     In reply to the final
disclosure the applicant argued that the projected GDP growth of Russia (in the
range of 3%) is rather moderate and will not allow for further development of
the Russian SWR market. Consequently, the Russian market might not be able to
absorb additional volumes of the like product. In this respect it is noted that
the Russian GDP growth during the period considered, i.e. from 2009 to the end
of the IP, was lower than the forecasted growth for the year 2014 and
nevertheless allowed for the growth of the SWR market in Russia by 38%.
Therefore the argument has been rejected.

(38)     The same party also pointed
to the new types of products that the cooperating exporting producer has
recently developed (in cooperation with its subsidiary based in the Union) and
claimed that this confirms the investments made by this producer in the period
considered. This fact however does not contradict the finding on the
cooperating producer’s inability to produce all type of ropes (especially SWR
in the high end of the market). Therefore the argument has been rejected.

(39)     The attractiveness of the
Union market should also be seen in the context of some acquisitions of Union
producers by the Russians exporting producers. Indeed, two Russian producers
currently own subsidiaries based in the Union. The verification visit to the EU
based subsidiary of the cooperating exporter revealed that its sales were
concluded mainly on the European market and that the related sales between the
cooperating producer and this subsidiary remained limited in RIP.

(40)     On the basis of the data of
the cooperating exporter, it has to be noted that the Russian export volume of
the product concerned to third countries exceeded four times the export volume
to the Union in RIP. The export prices of the cooperating exporting producer to
third countries were found to be on average lower than its domestic sales price
in the Russian Federation, but on average at higher levels than the export
prices to the Union market. This allows a conclusion that the export sales to
third countries' markets are more attractive than the sales to the Union
market. In this context, the existence of long established sales channels with
the Commonwealth of Independent States' (CIS) markets is also noted.

(41)     In reply to the final
disclosure the applicant argued that the export prices of the Russian producers
to the third markets are in fact lower than the export prices to the Union. A
comparison between average export prices to Ukraine and some European countries
based allegedly on the Russian customs statistics was evoked. No original data
underlying the comparison was submitted. In this respect it is noted that the
comparison of the price difference between Russian export prices to the Union
and to third markets carried out in the investigation was based on the verified
questionnaire data of the cooperating exporting producer. Such price comparison
was made at ex-works level taking into account the differences between the product
types and the level of trade. The average prices submitted by the applicant do
not reflect the complexity of the price components and ranges existing in the
SWR market and resulting from a significant number of different products and
different level of trade. Therefore the argument has been rejected.

(42)     The same party argued that
the level of export volume of the Union industry to the Russian Federation is
irrelevant in this case and rather pointed to the increased imports from the
People’s Republic of China to the Russian Federation and the need to take them into
consideration in the analysis as they constitute a competitive threat to the
presence of the Russian producers on the Russian and CIS markets. In this
regard the fact that the Union producers remain the export leaders on the
Russian market is relevant as it confirms inter alia the fact that the Russian
producers are unable to produce all types of SWR for which demand exists on the
Russian market. As regards the Chinese exports to the Russian Federation, it is
noted that they grew in parallel to the rapid growth of the demand of the
Russian market. No information was provided e.g. regarding Chinese export price
levels to the Russian Federation or CIS countries or the characteristics of the
imported product under investigation to allow for a further analysis. Finally,
it is noted that according to the Russian customs statistics the Russian
producers of the product concerned remained the leader on their SWR domestic
market in the RIP and the total imports to this market accounted for only about
15% of the Russian SWR market. Therefore the argument has been rejected.

3.4.        Production capacity and
excess capacity available for exports in the Russian Federation

(43)     According to the request
for review, the production capacity of all Russian exporting producers was 115
000 tonnes. During the investigation the applicant reassessed the Russian
production capacity to be in a range between 220 000 and 250 000 tonnes, which
was however not supported by any evidence. On the basis of the verified data of
the cooperating exporter, the data submitted by a second known producer and the
data contained in the request on the third producer, the production capacity of
all Russian producers of the product concerned was established at the level of
around 158 000 tonnes. In this context, it is noted that the production
capacity of the cooperating exporting producer underwent structural adjustments
in the period considered, as a result of which one production workshop was
closed.

(44)     In reply to the final
disclosure one party argued that some machinery from the closed production workshop
was transferred to another production site of the cooperating producer. No
evidence was provided however to support this claim. In this respect it is
confirmed that the evidence gathered during the investigation confirms that the
cooperating producer underwent in the period considered structural adjustments,
which included scrapping of some machinery in all three production sites and
closure of one production workshop. At the same time it cannot be excluded that
certain machinery from the closed production workshop was transferred to the
remaining ones. In any event, this does not change the estimation of the
production capacity of this producer and of Russia in total, which the party
did not contest. Therefore the argument has been rejected.

(45)     Regarding the question of
capacity utilisation and excess capacity, further to the data of two producers,
in the absence of any precise information on the capacity utilisation of the
third producer it was assumed that its capacity utilisation was in the range of
the two other producers i.e. 90% in RIP. Considering the above, it was
concluded that the total spare capacity in the Russian Federation is in the
range of 17 000 tonnes. This corresponded to about 8% of the Union consumption
in RIP.

3.5.        Conclusion

(46)     In view of the findings
that exports from the Russian Federation are still being dumped during the RIP,
there is a likelihood of continuation of dumping on the Union market in case
the current anti-dumping measures are removed.

(47)     However, the following
points should be highlighted. Firstly, there is a limited spare capacity
available in the Russian Federation, which may be absorbed by the fast growing
demand on the domestic market. Secondly, the Russian producers do not possess
capacities to deliver all types of ropes and therefore their competitive
pressure on the Union market is limited. Thirdly, two of three known exporting
producers have their fully owned subsidiaries in the Union producing the like
product. Based on the information received from the subsidiary of the
cooperating exporting producer, is can be seen that the like product produced
by the subsidiary is sold primarily on the Union market while the exporting
producer produces and sells the like product mostly for the Russian market. In
addition, the Russian exporting producers have strong commercial links with the
third country markets, in particular the CIS markets, which are more attractive
for the Russian exporters because on average the prices charged in these
markets are higher than the ones charged in the Union. On this basis it was
concluded that the imports of the product concerned from the Russian Federation
are unlikely to grow substantially should the measures be allowed to lapse.

D. DEFINITION OF THE UNION INDUSTRY

(48)     During the RIP, SWR are
manufactured by over 30 Union producers. The output of those producers
(established on the basis of the information collected from the cooperating
producers and for the other Union producers on the data from the applicant) is
therefore deemed to constitute the Union production within the meaning of
Article 4(1) of the basic Regulation.

(49)     As explained under recital
(12), due to the large number of Union producers, a sample was selected. For
the purpose of the injury analysis, the injury indicators have been established
at the following two levels:       
- the macroeconomic elements (production, capacity, sales volume, market share,
growth, employment, productivity, average unit prices, magnitude of dumping) were
assessed, at the level of the whole Union production, on the basis of information
collected from the cooperating producers, from Eurostat data and, for the other
Union producers, an estimate based on the data from the applicant was used;            
- the analysis of microeconomic elements (i.e. stocks, wages, profitability, return
on investments, cash flow, ability to raise capital and investments) was
carried out for the sampled Union producers on the basis of their information
which was verified.

E. SITUATION ON THE UNION MARKET

1.           Union Consumption

(50)     Union consumption increased
by 8% from 195 426 tonnes to 211 380 tonnes between 2009 and the RIP.

|| 2009 || 2010 || 2011 || RIP

Union consumption (in tonnes) || 195 426 || 206 940 || 213 350 || 211 380

Index || 100 || 106 || 109 || 108

2.           Current imports from the Russian
Federation

2.1.        Volume, market share and prices
of imports from the Russian Federation

(51)     According to Eurostat data,
the volume of imports of the product concerned originating in the Russian
Federation increased from 2 005 tonnes to 2 343 tonnes beween 2009 and the RIP.
Despite this increase, these volumes are lower than the imports from the
Russian Federation during the last investigation, where the imports were 2 908
tonnes for 2005 and 3 323 tonnes for the period 1 July 2005 to 30 June 2006
(last RIP). Moreover, since the end of the RIP, imports from Russia show a
decreasing trend (down by 20%).

(52)     The market share of the
Russian imports was 1.03% in 2009 and 1.11% in the RIP.

(53)     As
far as import prices are concerned, they have increased steadily by 12% over
the period considered.

|| 2009 || 2010 || 2011 || RIP

Import (in tonnes) || 2 005 || 2 197 || 2 549 || 2 343

index || 100 || 110 || 127 || 117

Market share || 1.03% || 1.06% || 1.19% || 1.11%

index || 100 || 103 || 116 || 108

Price of import || 1 054 || 1 084 || 1 171 || 1 178

index || 100 || 103 || 111 || 112

2.2.        Price undercutting

(54)     Price
undercutting was established using the export prices of the cooperating Russian
producer, without anti-dumping duty, and was found to range from 54.7% to 69.0%
depending on the product types with a weighted average undercutting margin of 63.4%.
However, in view of the low import volumes from the Russian Federation and the
numerous different types of SWR that exists, the price undercutting could only
be established on the basis of very few identical product types with low
volumes (19.9 tonnes). Therefore, the undercutting margin may only be
considered to be indicative.

3.           Imports from other countries

3.1.        Volume, market share and
prices of imports from other countries

(55)     Imports from countries
other than the Russian Federation have increased by 10.6% over the period considered,
which is higher than the increase in consumption on the EU market (+8%).
Despite the gain of EU market share by countries other than the Russian
Federation, the respective market shares can be considered as being stable.

(56)     The main exporting countries
during the RIP were South Korea with 16% market share followed by the PRC
(1.78%), Thailand with about 1.65% market share, and the Russian Federation
(see above, 1.11% market share) while the Union industry market share was close
to 60%.

Countries/ Imports in tonnes || 2009 || 2010 || 2011 || RIP

South-Korea || 32 027 || 23 926 || 28 906 || 34 798

China || 5 797 || 4 067 || 5 174 || 3 765

Thailand || 3 673 || 3 815 || 5 348 || 3 499

Other countries || 34 938 || 38 974 || 39 376 || 42 444

Subtotal (excluding the Russian Federation) || 76 435 || 70 782 || 78 804 || 84 506

|| || || ||

Russia || 2 005 || 2 197 || 2 548 || 2 343

|| || || ||

|| || || ||

Total imports (including the Russian Federation) || 78 440 || 72 979 || 81 352 || 86 849

3.2.        Price undercutting

(57)     The overall average
prices of imports of the like product from other countries remained stable
and unchanged during the period considered and undercut Union industry prices
on average by 57%.

4.           Situation of the Union
Industry

(58)     Pursuant to Article 3(5) of
the basic Regulation, the Commission examined all relevant economic factors and
indices having a bearing on the state of the Union industry.

4.1.        Preliminary remarks

(59)     In view of the fact that
sampling was used with regard to the Union industry, the injury was assessed on
the basis of information collected at the level of the entire Union industry
('UI') (macroeconomic elements as defined in recital (49)) and on the basis of
information collected at the level of the sampled Union producers (microeconomic
elements as defined in recital (49)).

(a) 
Production

(60)     The UI’s production increased
by 6% between 2009 and the RIP, i.e. from 214 475 tonnes to 228 368 tonnes. In
a context of increase comsumption (+8%), as mentioned under recital (52), the Union
Industry increased its production volume by 6%.

UI || 2009 || 2010 || 2011 || RIP

Production volume (in tonnes) || 214 475 || 223 385 || 224 559 || 228 368

index || 100 || 104 || 105 || 106

(b) 
Capacity and capacity utilisation rates

(61)     The increase in Union comsumption
(+8%) also triggered an increase in production by the Union Industry by 6%.

UI || 2009 || 2010 || 2011 || RIP

Capacity || 348 852 || 371 187 || 366 976 || 369 134

index || 100 || 106 || 105 || 106

Capacity utilisation || 61.5% || 60.2% || 61.2% || 61.9%

index || 100 || 98 || 100 || 101

(c) 
Sales volume

(62)     The sales by the UI on the
Union market increased by 7% between 2009 and the RIP.

UI || 2009 || 2010 || 2011 || RIP

Sales to unrelated parties in the Union (in tonnes) || 116 902 || 133 824 || 131 085 || 124 524

index || 100 || 114 || 112 || 107

(d) 
Market share

(63)     The UI managed to keep its
market share relatively stable during the period considered, i.e. at 60% in 2009
and at 59% during the RIP.

UI || 2009 || 2010 || 2011 || RIP

Market share || 60% || 65% || 61% || 59%

index || 100 || 108 || 102 || 98

(e) 
Growth

(64)     Between 2009 and the RIP,
when the Union consumption increased by 8%, the sales volume of the UI increased
as well by 7%. The market share of the UI can be therefore considered as being
stable, though it slightly lost market share, whereas the imports from the Russian
Federation did slightly increase.

(f) 
Employment

(65)     While the sampled Union
producers showed an increase of 5% during the period considered, the estimation
by the applicant of the level of employment of the entire UI is different and shows
a negative trend, being a decrease by 6% between 2009 and the RIP.

UI || 2009 || 2010 || 2011 || RIP

Employment || 3 763 || 3 776 || 3 688 || 3 544

index || 100 || 100 || 98 || 94

|| || || ||

(g) 
Magnitude of dumping margin

(66)     As concerns the impact on
the UI of the magnitude of the actual margins of dumping found (4.7%), given
the low overall volume of the imports from the Russian Federation and the
relatively low dumping margin, this impact cannot be considered to be significant.

(h) 
Stocks

(67)     The level of closing stocks
of the UI decreased between 2009 and the RIP.

Sampled producers || 2009 || 2010 || 2011 || RIP

Closing stock (in tonnes) || 11 723 || 10 240 || 9 813 || 10 489

index || 100 || 87 || 84 || 89

(i) 
Sales prices and factors affecting domestic prices

(68)     Unit
sales prices of the UI increased by 8% between 2009 and the RIP. This price
development is linked to the fact that the UI was able to pass on the increase
in the cost of production (by 8%) onto users. It is also linked to the
progressive migration of the UI towards larger diameter SWR and a higher focus
on special purpose ropes.

Sampled producers || 2009 || 2010 || 2011 || RIP

Average unit sales price in the EU (EUR/tonne) || 3 625 ||  3 658 || 3 809 || 3 911

Index || 100 || 101 || 105 || 108

(j) 
Wages

(69)     Between 2009 and the RIP,
the average wage per FTE increased by 20% during the period considered. Following
the restructuring of some sampled companies, the proportion of white collar
versus blue collar employees increased during the period considered, which is
reflected in the increased average salary cost per employee.

Sampled producers || 2009 || 2010 || 2011 || RIP

Wages per FTE (EUR) || 42 393 || 45 174 || 48 718 || 51 052

index || 100 || 107 || 115 || 120

(k) 
Productivity

(70)     Productivity of the UI’s
workforce, measured as output per full time equivalent ('FTE') employed per
year, was volatile over the period considered as it decreased in 2010 before going
up again in 2011 and in the RIP.

UI || 2009 || 2010 || 2011 || RIP

Productivity || 58 || 52 || 53 || 55

index || 100 || 88 || 90 || 94

(l) 
Investments and ability to raise capital

(71)     Investments in SWR increased
by 271% over the period considered, were significant and amounted to almost 16
million EUR during the RIP. The sampled producers did not face difficulty to
raise capital over the period considered. Moreover, a large proportion of the
investments could be financed by own generated cash flows.

Sampled producers || 2009 || 2010 || 2011 || RIP

Investments (EUR 1000) || 5 845 || 6 025 || 12 656 || 15 839

index || 100 || 103 || 217 || 271

(m) 
Profitability on the EU market

(72)     The
sampled producers managed to achieve profits over the whole period considered.
The profits achieved from 2009 to the RIP – despite the drop compared to 2009 -
were well above the target profit of 5% set in the original investigation.

Sampled producers || 2009 || 2010 || 2011 || RIP

Profitability on the EU market || 14.8% || 10.1% || 10.6% || 10.6%

index || 100 || 68 || 72 || 72

(n) 
Return on investments

(73)     The return on investments
(ROI), expressed as the total profit generated by the SWR activity in percent
of the net book value of assets directly and indirectly related to the production
of SWR, broadly followed the above profitability trends over the whole period
considered. Despite the drop, this indicator remains quite high.

Sampled producers || 2009 || 2010 || 2011 || RIP

ROI || 37.7% || 23.4% || 25% || 23%

index || 100 || 62 || 66 || 61

(o) 
Cash flow

(74)     The cash-flow situation
remains overall very positive, despite some detoriaration between 2009 and the
RIP: it follows to a certain extent the profitability trends over the whole
period considered.

Sampled producers || 2009 || 2010 || 2011 || RIP

Cash Flow (EUR 1000) || 57 545 || 40 640 || 38 297 || 43 380

index || 100 || 71 || 67 || 75

(p) 
Recovery from the effects of past dumping

(75)     The majority of the
indicators show that the UI adapted its production equipment to better face the
new economic environment and be able to seize opportunities on EU and non EU
markets in segments where high margins can be achieved. The improvement in the
economic and financial situation of the UI, further to the imposition of
anti-dumping measures in 2001, evidence that the measures are effective and
that the UI has recovered from the effects of past dumping practices.

4.2.        Conclusion

(76)     During the period
considered the UI managed more or less to maintain its market share, prices
increased by 8%, stocks remained at a reasonable level while production volume and
consumption increased. The UI was profitable throughout the period considered,
although profits were at a lower level in the RIP than in 2009. Considering the
above, it can be concluded that the UI did not suffer material injury over the
period considered.

F. LIKELIHOOD OF RECURRENCE OF
INJURY

(77)     It
has also been examined whether the recurrence of material injury would be
likely if the measures were allowed to lapse. It is assessed that this is not
be likely to happen for the reasons as explained below.

(78)     As
highlighted in recital (54) prices of imports from the Russian Federation were
found to undercut EU prices. However, given the low
volumes of matching product types, the present undercutting margin may only be
considered to be indicative.

(79)     As
explained in recital (51), the volume of imports of the
product concerned originating in the Russian Federation was 2 005 tonnes in
2009 and 2 343 tonnes during the RIP, representing a market share of respectively
1.03% and 1.11%.

(80)     As
explained in recitals (-43 ) and (45), the total Russian capacity is estimated
to be about 158 000 tonnes, whereas during the last investigation this was estimated to be approximately at
the level of the total EU consumption, namely 220 000 tonnes. Furthermore, the spare
capacities appear currently to be limited.

(81)     During
the last investigation, the Russian market was assessed as not able to absorb the
level of supply. Currently, as explained in recital (36), the domestic consumption
of SWR in Russia experienced a considerable growth by 38% in the period
considered. In addition, publicly available economic forecasts estimate a
strong GDP growth in the Russian Federation in the coming years. The Russian
spare capacity, as mentioned in recital (45), is therefore likely to be absorbed
by the growing Russian market as Russian prices are around 11% higher than
export prices to the EU. In addition, Russian export prices to other markets,
notably the CIS countries are on average 5.6% higher than the export prices to
the EU. It is therefore unlikely that substantial quantities of either the
spare capacity or their current sales on the more beneficial domestic market
and/or in CIS country markets will be redirected to the Union market.

(82)     In
the light of the above, it is concluded that the repeal of the measures on imports
originating in the Russian Federation would in all likelihood not result in the
recurrence of material injury to the UI as whole.

G. ANTI-DUMPING MEASURES

(83)     In the light of the above, the
anti-dumping measures applicable to imports of SWR from the Russian Federation
should be repealed and the present proceeding terminated in accordance with
Article 9(2) and Article 11(2) of the basic Regulation.

(84)     All parties were informed
of the essential facts and considerations on the basis of which it is intended
to recommend that the existing measures be terminated with regard to imports
originating in the Russian Federation. They were also granted a period to make
representations subsequent to this disclosure. Comments were received by one
interested party which also requested and was granted a hearing in the presence
of the hearing officer,

HAS ADOPTED THIS REGULATION:

Article 1

The anti-dumping measures concerning
imports of steel ropes and cables including locked coil ropes, excluding ropes
and cables of stainless steel, with a maximum cross-sectional dimension
exceeding 3 mm, with fittings attached or not, originating in the Russian
Federation and currently falling within CN codes ex
7312 10 81, ex 7312 10 83, ex 7312 10 85, ex 7312 10 89 and ex 7312 10 98, are hereby
repealed and the proceeding concerning these imports is terminated.

Article 2

The expiry review proceeding of the
anti-dumping measures applicable to imports of steel ropes and cables including
locked coil ropes, excluding ropes and cables of stainless steel, with a
maximum cross-sectional dimension exceeding 3 mm, with fittings attached or
not, currently falling within CN codes ex 7312 10 81, ex 7312 10 83, ex 7312 10
85, ex 7312 10 89 and ex 7312 10 98 and originating in the Russian Federation,
initiated pursuant to Article 11(2) of Regulation (EC) No 1225/2009, is hereby
terminated.

Article 3

This Regulation shall enter into force on
the day following that of its publication in the Official Journal of the European
Union.

This Regulation shall be binding
in its entirety and directly applicable in all Member States.

Done at Brussels,

For
the Council

The
President

[1]               OJ L 343, 22.12.2009, p. 51.

[2]               OJ L 211, 04.08.2001, p. 1.

[3]               OJ L 285, 31.10.2007, p. 52.

[4]               OJ L 285, 31.10.2007, p. 1.

[5]               OJ L 36, 09.02.2012, p. 1.

[6]               OJ C 330, 27.10.2012, p. 5.

[7]               According to the data obtained from Prommetiz –
Russian association of hardware producers.