# EUR-Lex - 52013PC0021 - EN

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# 52013PC0021

**Proposal for a COUNCIL IMPLEMENTING REGULATION imposing a definitive anti-dumping duty on imports of certain prepared or preserved citrus fruits (namely mandarins, etc.) originating in the People's Republic of China /* COM/2013/021 final - 2013/0017 (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') in the anti-dumping proceeding concerning imports of certain
prepared or preserved citrus fruits (namely mandarins, etc.) originating in the
People's Republic of China.

General context

This proposal is made in the context of the implementation of two
judgement of the General Court on the implementation of the basic Regulation
and is the result of two investigations which were carried out in line with the
substantive and procedural requirements laid out in the basic Regulation.

Existing provisions in the area of the
proposal

Definitive measures were imposed by Council
Regulation (EU) No 1355/2008 (OJ L 350, 30.12.2008, p. 35.).

Consistency with other policies and
objectives of the Union

Not applicable.

2.           RESULTS OF CONSULTATIONS WITH THE
INTERESTED PARTIES AND IMPACT ASSESSMENTS

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 contain
provisions for 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 3 December 2011 and, again, on 19 June
2012, the Commission announced by a notice (‘notice of partial reopening’),
published in the Official Journal of the European Union, the partial
reopening of the anti-dumping investigation concerning imports of certain
prepared or preserved citrus fruits (namely mandarins, etc.) originating in
China.

The first reopening was triggered by the
annulment by the General Court of the Council Regulation (EC) No 1355/2008 in
so far as it concerned the Chinese exporting producers Zhejiang
Xinshiji Foods Co., Ltd. and Hubei Xinshiji Foods Co. Ltd. and
the second reopening was triggered by the annulment by the General Court of the
same Council Regulation, but for different reasons, in its entirety. In line
with Article 266 of Treaty on the Functioning of the European Union, the
institutions of the European Union are obliged to comply with the judgment of
the General Court. Consequently, the European Commission initiated the partial
re-openings of the anti-dumping investigation, initially, on 3 December 2011,
in so far as it concerns the two above mentioned Chinese exporting producers
and eventually, on 19 June 2012, as concerns all parties.

The enclosed Commission proposal for a
Council Regulation re-imposing the anti-dumping duty on all imports concerned
is made upon the interested parties having been given sufficient time to
provide comments to the final disclosure document of 6 December 2012.

It is proposed that the Council adopt the
attached proposal for a Regulation which should be published in the Official
Journal of the European Union as soon as possible.

Legal basis

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 European 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 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:

Other means would not be adequate because
the basic Regulation does not provide for alternative options.

4.           BUDGETARY IMPLICATION

The proposal has no implication for the
Union budget.

2013/0017 (NLE)

Proposal for a

COUNCIL IMPLEMENTING REGULATION

imposing
a definitive anti-dumping duty on imports of certain prepared or preserved
citrus fruits (namely mandarins, etc.) originating in the People's Republic of China

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 Article 2(7)(a) and Article 9
thereof,

Having regard to the proposal submitted by
the European Commission (‘the Commission’) after having consulted the Advisory
Committee,

Whereas:

1.           PROCEDURE

(1)       On 20 October 2007 the
Commission announced by a notice published in the Official Journal of the
European Union the initiation of an anti-dumping proceeding concerning imports
into the Community of certain prepared or preserved citrus fruits (namely
mandarins, etc.) originating in the People’s Republic of China (‘PRC’)[2]. On 4 July 2008, the
Commission, by Regulation (EC) No 642/2008[3]
(‘the provisional Regulation’) imposed a provisional anti-dumping duty on
imports of certain prepared or preserved citrus fruits originating in the PRC.

(2)       The proceeding was
initiated as a result of a complaint lodged on 6 September 2007 by the Spanish
National Federation of Associations of Processed Fruit and Vegetables (‘FENAVAL’,
previously named ‘FNACV’) (‘the complainant’) on behalf of producers representing
100 % of the total Community production of certain prepared or preserved citrus
fruits (namely mandarins etc.). The complaint contained evidence of dumping of
the product concerned and of material injury resulting there from, which was
considered sufficient to justify the initiation of a proceeding.

(3)       As set out in recital (12)
of the provisional Regulation, the investigation of dumping and injury covered
the period from 1 October 2006 to 30 September 2007 (‘investigation period’ or ‘IP’).
The examination of trends relevant for the assessment of injury covered the
period from 1 October 2002 to the end of the investigation period (‘period
considered’).

(4)       On
9 November 2007, the Commission made imports of the same product originating in
the PRC subject to registration by Regulation (EC) No 1295/2007[4].

(5)       It is recalled that
safeguard measures were in force against the same product until 8 November
2007. The Commission imposed provisional safeguard measures against imports of
certain prepared or preserved citrus fruits (namely mandarins, etc.) by
Regulation (EC) No 1964/2003[5].
Definitive safeguard measures followed by Regulation (EC) No 658/2004 (‘the
safeguard Regulation’)[6].
Both the provisional and definitive safeguard measures consisted of a tariff
rate quota i.e. a duty was only due once the volume of duty free imports had
been exhausted.

(6)       By Regulation (EC) No
1355/2008 ([7])
(‘the original Regulation’) the Council imposed a definitive anti-dumping duty
on imports of certain prepared or preserved citrus fruits (namely mandarins,
etc.) originating in the People's Republic of China.

(7)       The range of the definitive anti-dumping duty was between 361,4 and
531,2 EUR/tonne net product weight.

1.1.        Xinshiji judgment

(8)       By
judgment of 17 February 2011 in case T-122/09 - Zhejiang Xinshiji Foods Co. Ltd
and Hubei Xinshiji Foods Co. Ltd v Council of the European Union supported by
European Commission[8]
- ('the Xinshiji judgment') the General Court
annulled the original Regulation in so far as it concerns the applicants
Zhejiang Xinshiji Foods Co., Ltd. and Hubei Xinshiji Foods Co. Ltd.

(9)       The
General Court's judgment was based on the grounds that the Commission breached
the rights of defence by not providing the information necessary for the
applicants to determine whether, in the light of the structure of the market,
the adjustment of export price to the ex-work level of the importer was
appropriate in that it made it possible to compare the export price and the
Union industry price at the same level of trade. The General Court also
considered that the Commission infringed the duty to state reasons as the
reasons for a measure must appear in the actual body of the measure and may not
be stated in written or oral explanations given subsequently when the measure
is already the subject of proceeding brought before the European Union Courts.

(10)     In
April 2011 the Commission lodged an appeal (C-195/11P) seeking to set aside the Xinshiji
judgment. Following the declaration of invalidity of
the original Regulation by the Court of Justice of the European Union ('the
Court') on 22 March 2012 (see recital (16) below), the Commission withdrew its
appeal as it became without object.

(11)     On
3 December 2011 the Commission published a notice[9] partially reopening the
anti-dumping investigation ('the first reopening Notice') in order to implement
the General Court's Xinshiji judgment. The re-opening was limited to determine whether, in the light of
the structure of the market, the adjustment of export price to the ex-work
level of the importer was appropriate in that it made it possible to compare
the export price and the Union industry price at the same level of trade.

(12)     Simultaneously,
all interested parties received a disclosure document with its enclosures
explaining the reasons behind the adjustment of the post-importation costs
which had been taken into account in calculating the price of products
originating in the People's Republic of China.

(13)     Interested parties were
given the opportunity to make their views known in writing and to be heard
within the time limit set out in the notice.

(14)     All parties which so
requested within the above time-limit and which demonstrated that there were
particular reasons why they should be heard were granted the opportunity to be
heard.

(15)     The two applicant
exporters, eight importers, two associations of importers and one association
of producers came forward as interested parties.

1.2.        Analogue country judgment

(16)     On
22 March 2012, in Case C‑338/10 – Grünwald Logistik Service GmbH (GLS) v
Hauptzollamt Hamburg-Stadt ('the analogue country judgment') – the Court
declared the original Regulation invalid[10].

(17)     The Court held that since the
Commission and the Council had determined the normal value of the product
concerned on the basis of the prices actually paid or payable in the European
Union for a like product, without taking all due care to determine that value
on the basis of the prices paid for that same product in a market economy third
country, they had infringed the requirements of Article 2(7)(a) of the basic Regulation.

(18)     On 19 June 2012 a notice[11] ('the second reopening
Notice') was published in the Official Journal of the European Union. In the
notice parties were informed that, in view of the above-mentioned judgment of
the Court, imports into the European Union of certain prepared or preserved
citrus fruits (namely mandarins, etc.) originating in the People's Republic of
China were no longer subject to the anti-dumping measures imposed by the
original Regulation, and that definitive anti-dumping duties paid pursuant to
that Regulation for the product concerned should be repaid or remitted.

(19)     The notice also partially
reopened the relevant anti-dumping investigation concerning imports of certain
prepared or preserved citrus fruits (namely mandarins, etc.) originating in the
People's Republic of China in order to implement the above judgment of the
Court.

(20)     The notice set out that the
reopening was limited in scope to the selection of an analogue country, if any,
and the determination of the normal value pursuant to Article 2(7)(a) of the
basic Regulation to be used for the calculation of any margin of dumping.

(21)     Moreover, by the same
notice, interested parties were invited to make their views known, submit
information and provide supporting evidence regarding the availability of
market economy third countries which could be selected to determine normal
value pursuant to Article 2(7)(a) of the basic Regulation, including with
regard to Israel, Swaziland, Thailand and Turkey.

(22)     The Commission directly
informed the Union industry and their association, the exporting producers,
suppliers and importers and their associations known to be concerned, and the
authorities of the third countries concerned. Interested parties were given the
opportunity to make their views known in writing and to be heard within the
time limit set out in the notice.

(23)     All parties which so
requested within the above time-limit and which demonstrated that there were
particular reasons why they should be heard were granted the opportunity to be
heard.

(24)     Eight importers and one
association of importers came forward as interested parties.

2.           PROCEDURE AFTER DISCLOSURE
OF PROVISIONAL MEASURES

(25)     Following the imposition of
provisional anti-dumping duties on imports of the product concerned originating
in the PRC, several interested parties submitted comments in writing. The
parties who so requested were also granted the opportunity to be heard.

(26)     The Commission continued to
seek and verify all information it deemed necessary for its definitive
findings. In particular, the Commission completed the investigation with regard
to Union ("Community") interest aspects. In this respect,
verification visits were carried out at the premises of the following unrelated
importers in the Union:

–
Wünsche Handelsgesellschaft International (GmbH
& Co KG), Hamburg, Germany,

–
Hüpeden & Co (GmbH & Co), Hamburg, Germany,

–
I. Schroeder KG. (GmbH & Co), Hamburg, Germany,

–
Zumdieck GmbH, Paderborn, Germany,

–
Gaston spol. s r.o., Zlin, Czech Republic.

(27)     All parties were informed
of the essential facts and considerations on the basis of which it was intended
to recommend the imposition of a definitive anti-dumping duty on imports of the
product concerned originating in the PRC and the definitive collection of the
amounts secured by way of the provisional duty. They were also granted a period
of time within which they could make representations subsequent to this
disclosure.

(28)     Some importers proposed a
joint meeting of all interested parties, pursuant to Article 6(6) of the basic Regulation;
however the request was refused by one of them.

(29)     The oral and written
comments submitted by the interested parties were considered and taken into account
where appropriate.

3.           PRODUCT CONCERNED AND LIKE
PRODUCT

(30)     Subsequent to the
imposition of provisional measures, two unrelated Union importers argued that
certain types of mandarins should be excluded from the definition of the
product concerned either because of their sweetness level or because of their
packing when exported. In this respect, it is noted that these claims were not
accompanied with any type of verifiable information and data proving that these
types have characteristics that differentiate them from the product concerned.
It is also noted that differences in packing cannot be considered as a critical
element when defining product concerned, especially when formats of packing
were already taken into account when defining the product concerned as set out
in recital (16) of the provisional Regulation. These arguments are therefore
rejected.

(31)     The measures were imposed
on the product defined in the original Regulation as follows: prepared or preserved
mandarins (including tangerines and satsumas), clementines, wilkings and other
similar citrus hybrids, not containing added spirit, whether or not containing
added sugar or other sweetening matter, and as defined under CN heading 2008,
currently falling within CN codes 2008 30 55, 2008 30 75 and ex 2008 30 90
(TARIC codes 2008 30 90 61, 2008 30 90 63, 2008 30 90 65, 2008 30 90 67 and
2008 30 90 69) and originating in the People's Republic of China.

(32)     In
this regard, in the analogue country judgement the Court interpreted the
statistics communicated by the Commission to the Court on 27 July 2011 as data
relative solely to the product concerned. However, it should be noted that such
statistics have a broader scope than the product under measures, since they
included full CN codes 2008 30 55, 2008 30 75 and 2008 30 90.The statistical
data only covering the product concerned or like product for CN codes 2008 30
55 and 2008 30 75, for the above mentioned countries during the investigation
period are as follows:

Country || Volume of imports (tonnes)

People's Republic of China || 49,791.30

Thailand || 666.10

Turkey || 151.20

Israel || 4.80

Swaziland || 0

(33)     Under CN code 2008 30 90 ,
the statistics included products other than the product concerned. As a
consequence, no conclusions can be drawn on imports of the like product with
regard to this CN code. Therefore, contrary to what the Court held in paragraph
33 of the analogue country judgement, it cannot be derived from the statistics
that the like product was imported during the investigation period in
significant quantities from either Israelor Swaziland.

4.           SAMPLING

4.1.        Sampling for exporting
producers in the PRC

(34)     Two unrelated EU importers
disputed that the Chinese exporting producers selected for the sample
represented 60 % of the total exports to the Union. Nevertheless, they were not
able to provide any verifiable information that could undermine the accuracy of
the sampling information submitted by the cooperating Chinese exporting
producers and largely confirmed in the course of the further investigation.
This argument is therefore rejected.

(35)     Three Chinese cooperating
exporting producers submitted representations claimed that their related companies
were exporting producers of the product concerned and should therefore be
included in the Annex of cooperating exporting producers. These claims were
considered warranted and it was decided to revise the relevant Annex
accordingly. One unrelated EU importer argued that exports made to the Union through traders should automatically be allowed to benefit from the measures
applicable to the Chinese exporting producers. In this respect, it is noted
that anti-dumping measures are imposed on products manufactured by exporting
producers in the country under investigation that are exported to the Union
(irrespective of which company trades them) and not to business entities engaged
only in trading activities. The claim was therefore rejected.

5.           DUMPING

5.1.        Market economy treatment
(MET)

(36)     Following the imposition of
provisional measures, no comments were submitted by the Chinese cooperating exporting
producer with respect to the MET findings. In the absence of any relevant
comments, recitals (29) to (33) of the provisional Regulation are hereby confirmed.

5.2.        Individual treatment

(37)     In the absence of any
relevant comments, recitals (34) to (37) of the provisional Regulation
concerning individual treatment are hereby confirmed.

5.3.        Normal value

5.3.1.     Comments of interested
parties following the second reopening notice

(38)     Certain
importers argued that Chinese imports would be necessary to cover Union demand,
although one importer indicated that Spanish and Turkish production together would
be sufficient to cover the Union market needs. One importer remarked that
imposition of anti-dumping duties would have resulted in significant increases
in the price of the product concerned. Increase in prices were also mentioned
by other importers. Different factors were identified as cause for such
increase like the decreasing availability of Chinese mandarins in the Union due
to internal demand and demand from other markets, crop failures and labour
shortage in China. Another
factor indicated was the reduced competition in the Union (it is estimated that
currently there are only three Union producers, while in 2000 there were
eight). One importer complained that anti-dumping measures would favour large
trading companies instead of the traditional ones, which have been trading the
product concerned with China for decades. This importer defends the existence
of a license system based on pre-2001 data.

(39)     A group of importers
claimed that the Union institutions should initiate a whole new investigation
instead of partially reopening the anti-dumping investigation which had
resulted in the imposition of measures which had been in force until the analogue
country judgment. This claim was based on the fact that those importers did not
see sufficient evidence for dumping or injury in the present situation of the
market.

(40)     Other importers submitted that
they disagreed with the possible use of the IP data if a new dumping margin
would needed to be calculated. According to those importers most recent data
should be used and in particular the periods 2010-11 and 2011-12 were suggested.

(41)     A group of importers
considered that the partial reopening of the investigation is in breach of
Article 266 of the Treaty on the Functioning of the European Union. According
to those importers, the case-law[12]
mentioned in the second reopening Notice should be recalled only if measures
are annulled or declared invalid due to an erroneous injury determination. In
their own words, "the Community institutions did not blunder at the stage
of determining injury, but as early as assessing whether the products concerned
were dumped at all". As in this case the original Regulation was declared
invalid due to the determination of normal value, the importers claimed that
such case-law does not apply.

(42)     Finally,
several importers recommended Turkey to be used as analogue country. At a hearing, one importer
suggested contacting the authorities of Japan and Korea, as also in those
countries there would also be companies which manufactured the like product
during the IP.

5.3.2.     Analysis of comments following
the second reopening notice

(43)     As
regards the many claims summarized under recital (38) above it should be
underlined that the Commission decided to re-open the initial investigation in
a limited manner, restricted to the possible identification of an analogue
country. It did not define a new investigation period, contrary to the approach
followed in the case that led to the judgment in Industrie des poudres
sphériques v Council (Case C-458/98 P [2000] ECR I-8147). This was
based on the consideration that given that antidumping duties had been in
place, any data collected during a new investigation period would have been
distorted by the existence of these antidumping duties, in particular with
regards to the establishment of injury. The Commission considers that the
points raised by the parties on the alleged absence of dumping at the present
point in time can be more appropriately discussed in the framework of an
interim review pursuant to Article 11 (3) of the basic Regulation. Whereas in
the initial investigation, the analysis on the existence of injury is carried
out ex post for the investigation period, the analysis of injury during
an interim review is done in a prospective manner, as the injury observed
during the investigation period of the review is likely to be influenced by the
fact that an antidumping duty is in place.

(44)     The
parties concerned are reminded that if an importer or another party wants the
measures to be fully reviewed, it has the possibility to request the initiation
of an interim review, as prescribed in Article 11(3) of the basic Regulation.
The parties concerned have that possibility at any time as the one year period
since the imposition of definitive measures referred to in Article 11(3) has
elapsed. Any party that had lodged a request for review pursuant to Article
11(3) prior to the analogue country judgement will be contacted by the
Commission services to determine whether it wishes to pursue its request.

(45)     Concerning the alleged
illegality of the partial reopening, it should be noted that the mentioned
case-law does not imply that a partial reopening might take place only if it
concerns determination of the injury suffered by the Union industry. What is
clarified in case T-2/95 and case C-458/98 P is that "in the case of an
act concluding an administrative proceeding which comprises several stages, its
annulment does not necessarily entail the annulment of the entire procedure
prior to the adoption of the contested act regardless of the grounds,
procedural or substantive, of the judgment pronouncing the annulment"[13]. Therefore it is irrelevant
whether the annulment or the declaration of invalidity of a regulation relates
to the determination of injury or the determination of the normal value.

(46)     In
respect of the use of IP data, it should be recalled that the second reopening
Notice concerned a partial reopening of the original investigation and not a
new investigation. Therefore, only data from the IP could be relevant and
should be examined, even more so as the export prices used in the comparison
would also be pertaining to that period. The claims for the use of more recent
data, therefore, have to be dismissed.

5.3.3.     Investigation following the
second reopening notice

(47)     In the judgement referred
to in recital (16) above, the Court specifically referred to four countries
from which, according to Eurostat data, there would have been significant
imports into the Union under the CN codes 2008 30 55, 2008 30 75 and ex 2008 30
90. These countries are Israel, Swaziland, Thailand and Turkey. In view of this, the Commission contacted the authorities of these countries via their
Missions to the European Union. They were all contacted before the partial
reopening of the investigation and again at the time of reopening. The Missions
concerned, as well the Delegations of the European Union to those four
countries, were requested to identify possible domestic producers of the like
product and, if any, to assist in obtaining their cooperation.

(48)     Although been contacted
twice, no replies were received from the Missions of Swaziland and Thailand to the European Union. Replies were received from the Missions of Israel and Turkey. The Turkish Mission provided addresses of six alleged producers, while the Israeli
Mission informed the Commission services that there had been no production of
the like product in Israel during the IP (nor that would be any such production
at the moment).

(49)     All six Turkish producers were
contacted, five of them twice. Three did not reply at all and the other three
informed the investigators that they were not producing the like product during
the IP. Therefore, although these companies offered to cooperate, they were not
in a position to provide the Commission with the necessary data. This finding
was corroborated by a submission received from a German importer with producing
interests in Turkey, which stated that during the investigation period there
was no production of the like product in Turkey.

(50)     Despite the absence of a
reply from the Mission of Thailand, two Thai companies, from which updated
addresses were obtained via the European Union Delegation in Bangkok, were also
contacted, twice each. Those two producers had already been contacted during
the original investigation – but at the time, this had not resulted in their
cooperation. Also this time, one of the producers did not reply at all to the
two requests while the other replied it did not intend to cooperate in the
investigation.

(51)     Despite the efforts of the
Commission via the Mission of Swaziland to the European Union and the
Delegation of the European Union in Swaziland, it has not been possible to
identify one or several producers in Swaziland.

(52)     In view of the suggestion
referred to in recital (42) above, cooperation was also requested from the
authorities of Japan and the Republic of Korea and in parallel the Delegations
of the European Union in those countries were requested to identify local
producers of the like product, if any. The Korean authorities did not reply,
but the Commission managed, through the Delegation of the European Union to the
 Republic of Korea, to obtain a name and address of a possible producer of the
like product in the Republic of Korea. This producer was contacted once but it
did not reply to the request for cooperation.

(53)     The Japanese authorities
contacted possible Japanese producers, however, according to the Japanese
authorities, these companies did not want to cooperate in the proceeding and
also did not want their identities to be forwarded to the Commission.

5.3.4.     Conclusion on the
investigation following the second reopening notice

(54)     Account
taken of the comments made by the parties, the analysis thereof and, in spite
of significant efforts by the Commission services, the lack of cooperation from
potential third country producers, it was concluded that a normal value on the
basis of the price or constructed value in a market economy third country as
prescribed by Article 2(7)(a) of the basic Regulation could not be determined.

5.3.5.     Comments of interested
parties following the imposition of provisional measures

(55)     It
is recalled that the normal value determination was based on the data provided
by the Union Industry. This data was verified at the premises of the
cooperating Union producers.

(56)     Following
the imposition of provisional measures, all three Chinese sampled cooperating
exporting producers and two unrelated Union importers questioned the use of
Union industry prices for the calculation of normal value. It was submitted
that normal value should have been calculated on the basis of the PRC
production costs account taken of any appropriate adjustments relating to the
differences between the EU and the PRC markets.

5.3.6.     Analysis of comments
following the imposition of provisional measures

(57)     In
this respect it is noted that the use of information from a non-market economy
country and in particular from companies which have not been granted MET would
be contrary to the provisions of Article 2(7)(a) of the basic Regulation. This
argument is therefore rejected. It was also argued that data on prices from all
other importing countries or relevant published information could have been
used as a reasonable solution account taken of the lack of analogue country
cooperation. However, such general information, in contrast to the data used by
the Commission, could not have been verified and cross checked with regard to
their accuracy in line with the provisions of Article 6(8) of the basic
Regulation. This argument is therefore rejected. No other argument was
submitted that could cast doubt on the fact that the methodology used by the
Commission is in line with the provisions of Article 2(7)(a) of the basic
Regulation and, in particular, the fact that it constitutes in this particular
case the only remaining reasonable basis for calculation of normal value.

5.3.7.     Conclusion on normal value

(58)     In
the absence of any other comments and the fact that despite the significant
efforts of the Commission services to identify a cooperating producer in an
analogue country, it has not been possible to obtain data from an analogue
country producer for the investigation period, recitals (38) to (45) of the
provisional Regulation are hereby confirmed.

5.4.        Export price

(59)     Following
the imposition of provisional measures, one Chinese sampled cooperating
exporting producer submitted that its export price should be adjusted in order
to take into account certain cost elements (in particular ocean freight). In
this respect it is noted that this issue was dealt with during the on-the-spot
verification both with regard to this company as well with regard to the other
companies in the sample. On that occasion, each company submitted information
with regard to the costs in question. The amount claimed now by the company is
considerably higher than the amount originally reported. It is noted that this
new claim is based simply on a declaration by a freight forwarder and does not
reflect data relating to a real transaction. None of the other sampled
exporting producers questioned the figures used with respect to ocean freight.
Moreover, given the late submission, this claim cannot be verified. In
particular, the adjustment requested does not relate to any data already on the
file. Following this claim the Commission has nevertheless reviewed the amount
of the cost in question account taken of the importance of this particular cost
to the EU export transactions reported by the company. As a consequence, the
Commission came to the conclusion that it is more appropriate to use the
average ocean freight cost verified on-the-spot for all the sampled Chinese
companies. Consequently, the company’s export price was adjusted accordingly.

(60)     One
other Chinese sampled cooperating exporting producer highlighted two
computation errors on the calculation of its export price related to its
submitted export listings. The claim was considered warranted and the
producer’s relevant export price was revised accordingly.

(61)     In
the absence of any other comments in this respect, recital (46) of the
provisional Regulation is hereby confirmed.

5.5.        Comparison

(62)     In
the absence of any comments in this respect, recitals (47) and (48) of the
provisional Regulation are hereby confirmed.

5.6.        Dumping margins

(63)     In
light of the above, the definitive dumping margins, expressed as a percentage
of the CIF Union frontier price duty unpaid, are the following:

–
Yichang Rosen Foods Co., Ltd, Yichang, Zhejiang: 139,4 %,

–
Huangyan No 1 Canned Food Factory, Huangyan, Zhejiang: 86,5 %,

–
Zhejiang Xinshiji Foods Co., Ltd, Sanmen,
Zhejiang and its related producer Hubei Xinshiji Foods Co., Ltd, Dangyang City,
Hubei Province: 136,3 %,

–
Cooperating exporting producers not included in
the sample: 131 %,

All other companies: 139,4 %.

6.           IMPLEMENTATION OF THE XINSHIJI
JUDGMENT

6.1.        Comments of interested
parties

6.1.1.     Premature reopening

(64)     The
exporters concerned and a group of importers argued against the partial
reopening prior to the delivery of the judgment in case C-338/10. It was argued
that reopening the investigation while the validity of the original Regulation
was challenged and, in the opinion of the parties concerned, the act was likely
to be declared void, breached the principles of proportionality and of good
administration in the light of Article 41 of Charter of Fundamental Rights of
the European Union as it unnecessarily placed an undue burden on the parties
concerned to devote significant financial and personal resources to the
reopened procedure.

(65)     In
addition, the same parties also argued that reopening the investigation before
the judgment in the appeal case C-195/11P was premature and contrary to
Articles 266 and 264 TFEU and Article 60(2) of Statute of the Court of Justice
alleging that the Commission was anticipating the success of its own appeal.
Such initiation contradicted the relationship between, on the one hand, the
Commission and the Council and on the other, the Court and it impaired the
right to an effective court remedy. The importers concerned requested that the
Commission first await the final decision of the Court before it reopens the
anti-dumping proceeding to implement the judgment in question.

(66)     The
exporters concerned and a group of importers argued that the reopening violated
Article 3 of the basic Regulation as it was based on the data collected during
the investigation period (i.e. 1 October 2006 – 30 September 2007) and not during
a more recent period.

(67)     A
group of importers challenged the fairness and impartiality of the Commission's
conduct pursuant to Article 41(1) of the Charter of Fundamental Rights of the European
Union on the grounds that the Commission allegedly rejected an application by
the Union importers to launch a full interim review, even though the official
Eurostat data already showed an increase on a sustained and lasting basis of
the import price.

6.1.2.     Retroactivity

(68)     The
exporters concerned and a group of importers argued that the reopening was
destined to fail for the reason that the infringement of the rights of defence
and the failure to state reasons in case of a definitive anti-dumping
Regulation cannot be rectified in isolation and retroactively. In particular,
it was argued that the rights of defence of the interested parties were to be
protected during the on-going anti-dumping proceeding, i.e. before adoption of
the measure, and the proper statement of reasons for the definitive
anti-dumping regulation was to be provided no later than at the adoption of the
original Regulation.

(69)     It
was also argued that a legal act based on an inadequate statement of reason is,
and remains, ineffective from the start and the intended measure can only
become effective by adopting a new legal act with a proper statement of
reasons.

6.1.3.     Inadequate disclosure

(70)     The exporters concerned and
a group of importers claimed that the disclosure was not sufficient to remedy
the legal errors identified by the General Court for the reasons set out below.

(71)     The exporters concerned
together with a group of importers argued that the violation of EU law found by
the General Court affected the entirety of the findings and the outcome of the
injury margin calculation, which required a new process to be launched taking
into account the most recent injury data.

(72)     Furthermore,
the same parties argued that the Commission failed to recognise correctly the
scope and consequences of its infringement. It was argued that, contrary to the
Commission's interpretation, the legal infringements established by to General
Court did not relate exclusively to the calculation of the 2% uplift of the
import costs of the Chinese products (post-importation costs) and the transport
costs of the products produced by Union producers. The importers concerned
argued that those infringements related at the very least to the entire determination
of the injury margin.

(73)     In
this context it was argued that the disclosure sent at the reopening failed to
address the question of the comparability of the level of trade and how the
method chosen by the Commission for the comparison of the import and Union
prices was justified against the background of the market environment
concerned, i.e. whether the products produced by Union producers and the
imported goods are in fact in competition with each other 'in the warehouse of
the Hamburg importers'. The exporters concerned and a group of importers argued
that the information on the level of trade determination provided at the time
of reopening remained far too general to enable the parties to understand why
the comparison of the import price and the Union industry price was done at the
same level of trade and it largely left unexplained the factors which emerged
from the investigation on which that calculation was based. It did not deal
with the issue why the 2% uplift in question, which contained neither the
operating and administrative expenses (SG&A) nor a profit margin of the
importers, was appropriate to achieve comparability of the selling prices of
the Union producers with the import prices of the exporting Chinese producers.

(74)     The
same parties argued that no findings of any kind were made regarding the
assumption that the Union producers sold the goods exclusively via importers.
Also, it was argued that the underlying reasoning for the selected level of
trade that the Union producers sold exclusively to importers was refuted since
according to the disclosed information only 62% of the sales of Union producers
went to the independent importers. The parties argued that the Commission
appeared to ignore the fact that allegedly 38% of the Union production had not
been sold through importers, meaning that in respect of these sales imported
products were competing at a different level of trade. For this part of sales,
it was argued, the method used by the Commission to determine the injury margin
was inappropriate as the importers' prices should have been adjusted by adding
post-importation costs, selling, general and administrative expenses and an
appropriate profit margin of the independent importer. In the light of these
corrections the injury margin would have been reduced for 38% of the Union
goods, which would lead to an overall reduction in the injury margin and a
following substantial reduction in the anti-dumping duties.

(75)     As a result, the parties
argued that the Commission failed to develop an appropriate method to determine
the injury margin for all imports which would have taken account of the actual
market conditions. It was argued that there was a need for differentiated
consideration of the sales of the products of the Union producers for the
determination of the injury margin in view of the different distribution
channels of the Union producers.

(76)     The
parties called for the Commission to provide a detailed description and
analysis of the evidence verified in respect of trade flows and related volumes
supporting its findings and to disclose that relevant information, which was
not confidential.

(77)     A
group of importers also contested the "stereotype reference" to the
confidentiality of the data as a result of which the exporting producers and
Union importers were barred from access to relevant sources necessary for them
to determine whether, in the light of the structure of the market, the
adjustment in dispute was appropriate in that it made it possible to compare
the export price and the Union industry price at the same level of trade. The
importers concerned argued that this claim was upheld by the General Court in
para 86 of the Xinshiji judgment.

6.1.4.     Transport costs

(78)     The
exporters concerned opposed the increase of the Union industry's ex-works
selling price to include the costs of delivering to the importer's warehouse on
the grounds that it goes against the concept of internal market and that the
trade defence measures are not meant to remedy cost disadvantages of the Union
industry due to the location of its production facilities.

(79)     The
exporters concerned and a group of importers argued that the Commission should
have taken into account the fact that the importers had higher transhipment
costs because the Chinese products were delivered in containers, while the
products produced by Union producers were palletized for transportation by
truck and therefore could immediately be re-expedited to customers without any
further manipulation, which reduced the handling charges by 50% or 7 EUR/tonne.

(80)     A
group of importers argued that the Commission overlooked, for a percentage of
the Union industry products which were in fact distributed via an importer,
that the transport costs for the Union industry goods to the importers'
warehouse were incurred only if the preserved mandarins had been 'physically'
made available in the warehouse of the importer concerned. In fact, however,
the bulk of the products sold by the Union producers via importers were
delivered directly by the Union producers to the importers' customers. This was
claimed to procure a considerable cost advantage for the Union producers
compared to imported products and, if it had been properly taken into
consideration, a smaller injury margin would have resulted than that determined
on the basis of the Commission's calculation method.

(81)     The
association of importers and some importers objected to the figure (90 EUR)
used as a basis for the calculation of the transport costs. The parties claimed
that the transport costs chosen were too high, referring probably to transport
by truck. However, according to the information of the parties, the majority of
goods was transported by vessels, which is a much cheaper mode of transport.

(82)     The
parties asked for an explanation concerning the inclusion of terminal handling
charges and the costs for trucking to the importer's premises in the post-importation
costs.

6.2.        Analysis of comments

(83)     In respect of the argument
that the investigation should not have been reopened while the validity of the
original Regulation had been challenged in case C-338/10 (recital (64), the
Commission explained that it acted under the presumption of legality.

(84)     In respect of claims
concerning the premature reopening subject to the pending appeal case C-195/11P
(recital (65)) the Commission considers the argument without object, given that
the re-opening was based on the findings of the General Court. Furthermore, the
appeal has in the meantime been withdrawn.

(85)     In
respect of the claims for a new investigation it has to be underlined that the
partial reopening has as its objective to remedy only of the violation of the
rights of defence identified by the General Court, not to reopen the entire
proceeding. However, the Commission will advise the parties concerned that they
have the possibility to request the initiation of an interim review, as
prescribed in Article 11(3) of the basic Regulation, if they want the
Institutions to verify their claim that on the basis of more recent data, there
is no more injury.

(86)     With regards to the claim
that the injury analysis should be based on more recent data (recital (66)), it
is observed that any more recent data will be influenced by the fact that an
antidumping duty has been in place. Therefore, the appropriate instrument to
analyse more recent data is an interim review as prescribed in Article 11(3) of
the basic Regulation, and not a new investigation (see also recital (43)
above).

(87)     As regards the doubt
concerning the impartiality and fairness of the proceeding (recital (67)), this
is based on a misunderstanding that the Commission rejected the request for an
interim review. The Commission's Services informed the respective parties by
letter of 6 September 2011 that on the basis of the information provided to
that date no decision could be taken whether or not a review could be
initiated. The points which required further clarification or evidence were
outlined. The parties were informed about this at the hearing of 29 February
2012 and were invited to continue the discussion with the relevant Commission
service. The Commission services will inform them that they can pursue their
request as of the date of entry into force of this Regulation. The one-year
period foreseen in Article 11 (3) of the basic Regulation does not apply in the
case at hand, as this would run counter its objective, which is that there
should be a minimum amount of time between the initial investigation period and
an interim review. In the present case, this minimum amount of time has been
observed.

(88)     As regards the argument
concerning the retroactive remedy of the breach of rights of defence (recital (68))
the Commission considers that as a consequence of the judgement of the General
Court, the investigation has been re-opened at the point where the illegality
occurred. The parties have now a possibility to exercise their rights to the
extent they were prevented from doing as established by the General Court. Furthermore,
the duties will be imposed only for the future. Against this background the
Commission considers that there is no issue of retroactive remedy as claimed by
the parties and this argument of the parties has to be therefore dismissed.

(89)     As regards the argument
concerning the inadequate statement of reasons (recital (69)), the very purpose
of the reopening is to remedy the lack of reasoning and to base the new legal
act on a complete statement of reasons. It is therefore considered that this
argument of the parties is addressed.

(90)     In respect of the scope of
the judgment (recital (72)) the purpose of the reopening is to establish the
appropriate level of trade, and in particular to clarify why the
post-importation cost adjustment of the CIF export price was necessary to
ensure that the comparison of the export price and of the Union industry price
was done at the same level of trade. The argument of the parties has to be,
therefore, dismissed.

(91)     As regards the claims
concerning the deficiency of the disclosure document of 5 December 2011 in
respect of the explanation of level of trade applied in this case (in
particular, recitals (73) to (76)), the parties were provided with additional
information and explanation at several occasions, namely in points 4 and 5 of
the disclosure document of 5 December 2011 as well as during the hearings of 29
February 2012.

(92)     For the sake of full clarity on this point, the findings
concerning the level of trade are summarised as follows: (i) The investigation
showed that the canned mandarins are only produced in one Spanish region (Valencia) and are mainly sold in Germany and United Kingdom. The proportion of Union sales to Germany and United Kingdom was
established to represent 62% of the total Union sales. (ii) On the basis of the
verified data it was established that during the IP the Union producers and the
Chinese exporters sold essentially to the same customers, i.e. to traders or
distributors. (iii) For these reasons, the price comparison between the imports
from the exporting producers and the sales of the Union producers was made for
the exporting producers at frontier level (CIF) and for the Union producers at
factory level (ex-works) adjusted to the importers' warehouses. (iv) This
methodology required the following adjustments: on the one hand, a
post-importation costs adjustment of the Chinese CIF export prices to bring the
goods from the port to the importers' warehouses; this adjustment, fixed at 2%,
was based on the collected and verified invoices and the respective calculation
was disclosed to the interested parties in the annex to the disclosure document
of 5 December 2011. On the other hand, the Union ex-works prices were increased
to reflect the cost of freight to bring the goods from the producers (Valencia) to the importers' premises (Germany and United Kingdom). This freight adjustment was
calculated based on the established transport costs from Valencia to Hamburg. Given that not all sales of Union producers were delivered to Germany and United Kingdom, this average was lowered in proportion of the share of sales to Germany and United Kingdom (62%) and in proportion of direct sales.

(93)     As regards the proportion
of direct sales of the Union producers, it has been in a range of between 2%
and 12% during the IP. The precise percentage cannot be disclosed for
confidentiality reasons.

(94)     Furthermore, it was argued
that a differentiated approach in determination of the appropriate level of
trade in respect of the direct sales of the Union producers (recital (72))
should have been developed. In this respect it is to be noted that based on the
verified findings none of the Chinese imports were sold directly during the IP.
Since there were not matching direct sales on the side of the Chinese exports,
it was not possible to develop a differentiated approach for establishing a
level of trade for the proportion of direct sales of Union producers. Instead,
for the purpose of the injury margin calculation, the direct sales of Union
producers were adjusted back to the ex-works level and subjected to the freight
adjustment described in recital (92) point (iv) above. Against this background,
the respective claim of the parties has to be dismissed.

(95)     As regards the claim of the
parties that the adjustment of the CIF export price should have included the
SG&A and a reasonable profit margin (recital (73)) it is noted that had the
Commission adjusted the export CIF price by adding SG&A and profit, it
would have brought the sales of imported goods to the retailer level. In such
case the comparison between the Chinese export prices and the Union sales
prices would have been carried out at different levels of trade. For this
reason, the claim of the parties has to be dismissed.

(96)     As regards the argument of
the parties that it stems from the disclosure document of 5 December 2011 that
38% of sales of Union producers in the IP were direct sales (recital (74)), it
was explained to the parties at the hearings of 29 February 2012 that this
conclusion was mistaken. The figure of 62% of Union industry sales that were
made in Germany and United Kingdom relates to the geographical distribution of
the sales and has no relevance as regards the identification of the type of
customer, and thus as regards the identification of direct sales. It may only
be deduced from this fact, and it is confirmed, that the remaining 38% of the
sales of Union producers were made outside Germany and the United Kingdom. Since the parties' assumption on the level of trade of 38% of sales of Union
producers is incorrect, the subsequent claim based on this assumption
concerning the need to recalculate the injury margin has to be also dismissed.

(97)     Regarding the claim on
detailed disclosure of trade flow and related volumes (recital (76)), it is
recalled that the facts and figures underlying the choice of methodology to
determine the level of trade in this case have been addressed in the points 3
to 7 of the disclosure document of 5 December 2011. The parties are referred to
this information as well as the explanation provided at the hearings of 29
February 2012. For sake of clarity, the underlying trade flows are explained in
detail in recital (92) above.

(98)     As regards the argument on a
'stereotype reference to confidentiality' (recital (77)), the Commission
considers that the information that was kept confidential related to the (i)
percentage of direct sales and (ii) the information used for the calculation of
the 2% uplift based on invoices and data gathered during the verification
visit. In this respect it is noted that the invoices constitute information confidential
by nature. The non-confidential summary of the latter has been provided in the
annex to the disclosure document of 5 December 2011. As regards the direct
sales the Hearing Officer at the joint hearing of 29 February 2012 confirmed
that actual figures about direct sales are confidential information and offered
to examine on request of the interested parties how the actual data in the
confidential file was used by the Commission services responsible for the
investigation and to inform the parties whether in his view the data were
correctly reflected in the findings. The parties did not request it. For these
reasons the Commission considers that the requirement to disclose all but
confidential information was met. Furthermore, given that the data under
assessment is more than 5 years old, the Commission considers that it can
disclose at this stage that the percentage of direct sales is between 2% and
12%.

(99)     Concerning the objection of
the parties to the freight adjustment of the Union ex-works selling price
(recital (78)) the Commission considers the adjustment in question was made to
bring the goods to the importer's warehouse, i.e. to the same level of trade as
the Chinese exports. This adjustment was based on the specific circumstances of
the relevant market where the canned mandarins are only produced in one Spanish
region (Valencia) and are mainly sold in Germany and United Kingdom. It was
made to achieve the fair comparison between export price and the Union price at
the same level of trade, not to offset the claimed cost disadvantage of the
Union producers due to the location of their production facilities. The
argument of the parties is therefore dismissed.

(100)   Concerning the argument that
the Commission should have taken into account the higher costs of importers
because the Chinese products were delivered in containers while the Union
industry products were palletised which resulted in the reduction of handling
charges by the Union producers (recital (79)), it is noted that the adjustments
made covered only the cost of bringing the goods to the importer's warehouse.
The subsequent costs incurred in the context of the shipment of the goods to
the retailers are to be borne after the defined level of trade and cannot be
therefore taken into account. For this reason the argument of the parties is
dismissed.

(101)   Concerning the argument that
the transport costs of the Union producers should have been reduced to take
into account cases where the products were delivered directly to the customers
of importers as claimed by the latter (recital (80)), it is recalled that the
freight adjustment of the Union ex-works sales price was based on the
established costs of physical delivery to the warehouse in Hamburg (90 EUR)
based on collected invoices, because the warehouse Hamburg is the appropriate
level of trade for comparing export price and prices of the Union product. The
freight adjustment is not justified on the ground that it includes total
transport costs between the Union producer and the retailer (which would be
higher than the costs for delivery to the warehouse), but on the ground that in
the light of the specificities of the market for the product concerned, the
warehouse in Hamburg is the appropriate level of trade. In this context, the
argument raised by the parties appears immaterial.

(102)   The parties claimed that the
applied freight adjustment was too high because it was based on the transport
costs by truck (recital (81)). In this context, it is recalled that the freight
adjustment was based on the established costs of physical delivery to Hamburg, which included both truck and boat. Therefore, the adjustment requested by the
parties had already been included in the calculation of freight cost to Hamburg. It was therefore not necessary to verify the data submitted by the parties during
the hearing, as during the original investigation, the costs for delivery to Hamburg had been established on the basis of the verified data of the EU producers.

(103)   Regarding the comment made
by the applicant concerning the calculation of the post-importation cost
(recital (82)), it was stated that, as explained in paragraph 9 of the
disclosure document sent on 5 December 2011, both terminal handling charges and
the costs for trucking to the importer's premises were included in the
calculation. No ocean or insurance freights were included in terminal handling
charges as these costs were already included in the CIF price gathered and
verified during the on-spot verifications at the exporter's premises. Thus, if
the Commission had included those costs in the calculation of the
post-importation costs this would have implied double-counting.

6.3.        Procedure

(104)   On 5 December 2011 the
Commission submitted a disclosure document with facts and figures relating to the
grounds on which the General Court annulled the measures. All interested
parties were invited to comment.

(105)   On 29 February 2012 the
Commission held hearings with all parties that requested so, including a joint
hearing with the Hearing Officer of the exporters concerned and a group of
importers.

(106)   On 26 March 2012 one of the
interested parties informed the Commission that in view of the judgment in case
C-338/10 it considered the partial reopening concerning post-importation cost
without purpose.

(107)   On 17 July 2012 the
Commission responded that in the light of the reopening of 19 June 2012 it was
considered that both partial reopenings are still pending and none of these
investigations had become without purpose.

6.4.        Conclusion

(108)   The Xinshiji judgment of
General Court has been implemented by providing additional reasoning,
information and explanation to the parties on the reopened point of the
original investigation. The parties were given opportunity to comment and to be
heard. All arguments raised have been addressed and duly taken into account.

(109)   Account taken of the
comments made by the parties and the analysis thereof it was concluded that the
arguments and facts raised by the interested parties did not show a need to
modify the contested injury margin calculation.

(110)   Therefore, the injury margin
determined in the original investigation is hereby confirmed.

(111)   On the basis of the above it
was concluded that the implementation of the Xinshiji judgment should take the
form of re-imposing the definitive anti-dumping duty for the applicants in the
case in question.

7.           INJURY

7.1.        Union production and Union
industry

(112)   In the absence of
substantiated comments, the findings set out in recitals (52) to (54) of the
provisional Regulation are confirmed.

7.2.        Union consumption

(113)   One of the exporting parties
argued that there is a discrepancy between the level of the consumption set out
in the safeguard Regulation No 658/2004 and the level set in the provisional
Regulation. It is underlined that the difference in the level of consumption
was basically due to the different product scope in the current investigation
and to the different number of Member States in those two investigations. No
further and substantiated information was received in this respect. The
findings set out in recitals (55) to (57) of the provisional Regulation are
therefore confirmed. As a corollary, the subsequent parts of the analysis which
draw on consumption are also confirmed in this respect.

7.3.        Imports from the country
concerned

7.3.1.     Volume and market share of
imports of the product concerned

(114)   In
respect of the market share some interested parties opposed the Commission
statement set out in recital (58) of the provisional Regulation that indicated
an increase of the market share of the dumped imports. They argued that
contrary to the Commission findings the market share of imports from China decreased. The evaluation of imports from
the PRC in volume and market share was verified. As set out in said recital
there was only one year where the market share of the Chinese imports
decreased. For the rest of the period examined the market share of imports from
  China remained consistently high. Therefore the findings presented at the
provisional stage are confirmed.

(115)   Some parties argued that
post-IP volumes should also be examined to assess whether Chinese imports are
increasing. It is to be noted that trends on imports from China were evaluated for the period 2002/2003 to 2006/2007 and a clear increase was observed. In
accordance with the provisions of the basic Regulation, post-IP events are not
taken into account, except in exceptional circumstances. In any event, as
stated below in recital (136) the level of imports post-IP was examined and was
found to be significant.

7.3.2.     Price undercutting

(116)   Three
cooperating exporting producers contested the Commission's findings on
undercutting. One contested the methodology used to calculate undercutting and
requested an adjustment to reflect costs borne by traders for their indirect
sales. Where justified, calculations were adapted. The revised comparison
showed that, during the IP, imports of the product concerned were sold in the
Union at prices which undercut the Union industry's prices by a range of 18,4%
to 35,2% based on the data submitted by the sampled cooperating exporting
producers.

7.4.        Situation of the Union
industry

(117)   Two importers and the
importers' association contested the duration of the packing season indicated
in recital (79) of the provisional Regulation. They argued that the packing
season in Spain lasts only three months instead of four to five as indicated in
the provisional Regulation. However this allegation is linked to the crop
(variable by nature) and to the quantity produced and in any case has no impact
on the injury factors as analysed by the Commission services.

(118)   In the absence of any other substantiated information or argument
concerning the situation of the Union industry, recitals (63) to (86) of the provisional Regulation are hereby confirmed.

7.5.        Conclusion on injury

(119)   Following disclosure of the
provisional Regulation, some importers and some exporting producers claimed,
with reference to recitals (83) to (86) of the provisional Regulation, that
data used by the Commission to establish the injury level was neither correct
nor objectively evaluated. They argued that almost all injury-related
indicators showed positive trends and that therefore no evidence of injury can
be found.

(120)   In this regard, it is noted
that even if some indicators show small improvements, the situation of the
Union industry has to be evaluated as a whole and in consideration of the fact
that safeguard measures were in place until the end of the investigation
period. This matter was explored at length in recitals (51) to (86) of the provisional Regulation. The deep restructuring
process which these measures allowed for, resulting in a large reduction in
production and capacity, would have under normal circumstances led to a significant
improvement in the Union producers’ overall situation, including production,
capacity utilisation, sales, and price/cost differentials. Instead, volume
indicators have remained weak, stocks have increased substantially and
financial indicators have continued to be in the red—some even worsening.

(121)   On this basis, it is
considered that the conclusions regarding the material injury suffered by the
Union industry as set out in the provisional Regulation are not altered. In the
absence of any other substantiated information or arguments, they are therefore
definitively confirmed.

8.           CAUSATION

8.1.        Effect of the dumped
imports

(122)   Some parties argued that the
volume of the Chinese imports had been stable since 1982 and that therefore
they could not have caused injury as explained in the provisional Regulation
(see recital (58)). Indeed, as explained above in recital (114), imports from China during the period examined have increased significantly to the detriment of the EU
industry market share. Moreover, the argument refers to the trend in imports
that exceed well above the period in question therefore the argument is
rejected.

(123)   As mentioned in recital (116)
above, it is definitively concluded that during the IP, the prices of imports
from the sampled Chinese exporting producers undercut the average Union
industry prices by percentages ranging from 18,4% to 35,2%. The revision
of the undercutting margin leaves unaffected the conclusions on the effect of
the dumped imports set out in recitals (100) and (101) of the provisional
Regulation.

8.2.        Exchange rate fluctuations

(124)   After the imposition of the
provisional duties some importers further argued the negative influence of the
exchange rate on the price level. They
argued that the exchange rate level is the main factor that caused injury.
Nevertheless, the Commission’s assessment refers merely to a difference between
price levels with no requirement to analyse the factors affecting the level of
those prices. As a consequence a clear causal link between the high
dumping level and the injury suffered by the Union industry was found and
therefore recital (95) of the provisional Regulation can be confirmed.

8.3.        Supply and price of raw
materials

(125)   Some interested parties
argued that injury is not caused by dumped imports but rather by the scarce
supply of fresh fruit i.e. the raw material for canned mandarins.

(126)   However, official data from
the Spanish Ministry for Agriculture confirm that the quantity available for
the canning industry is more than sufficient to cover all the production
capacity of the Spanish producers.

(127)   Producers compete to a
certain extent for fresh fruit with the direct fresh produce consumer market.
However, this competition does not break the causal link. A clear, significant
reason for the Union industry’s relatively low production, sales and market
share is rather to the pressure of the massive imports from China at very low prices. In this situation, and considering that the market price is dictated by
the imports covering more than 70% of the market, which engage in price
undercutting, suppression and depression, it would be uneconomic to produce
more without reasonable expectations for selling the product at prices allowing
for a normal profit. Therefore the Spanish industry could reasonably provide
significantly higher quantities under the condition that the market price would
not penalise their economic results.

(128)   Another
fact confirming this analysis is the consistent existence of a significant
amount of stocks by Union producers, underlining that the Union industry’s
injurious situation occurred not because of insufficient production, but due to
production that cannot be sold due to the pressure of Chinese imports.

(129)   As
an agricultural product, the price of the raw material is subject to seasonal
fluctuations due to its agricultural nature. Nevertheless, in the five-year
period analysed, which included harvests with lower and higher prices, the
Commission observes that injury (e.g. in the form of financial losses) occurs
irrespectively of these fluctuations and therefore the economic results of the
Union industry are not directly correlated to such seasonal fluctuations.

8.4.        Quality differences

(130)   Some parties claimed that
the Chinese product was of a higher quality than the Union production. However,
any price differences resulting therefrom were not sufficiently substantiated,
and there is no evidence that the alleged consumer preference for Chinese
products would be so intense as to be the cause of the deteriorated situation
for the Union industry. In any case such alleged price differences would favour
the Chinese product, increasing the undercutting/underselling level. In the
absence of any further new and
substantiated information or argument, recital (99) of the provisional
Regulation is hereby confirmed.

8.5.        Cost increases

(131)   Some parties argued that
extraordinary cost increases by some producers were at the root of the injury.
These allegations were not sufficiently substantiated. The Commission analysis
did not detect any such events which could reverse the assessment of causation
or affect the calculation of the injury elimination level.

(132)   Some parties submitted
comments on the increased costs of production and inability of the Union
industry to reduce them. Certain cost items (such as energy) have increased,
but their impact is not such as to break the causal link in a context where a
very significant amount of dumped Chinese exports are depressing sales and
production (thereby increasing the Union industry’s unit costs) and suppressing
and depressing Union industry prices.

8.6.        Aid schemes

(133)   It was alleged that the EC
aid schemes caused artificial growth of processing in the EC and then
encouraged reduced levels of raw material supply for the product concerned.
This allegation was of a general nature and was not sufficiently substantiated.
In any event, the schemes in question were modified in 1996 when the aid was
allowed to the farmers instead than to the processors of the product concerned.
The Commission's analysis has not detected any residual effects during the
investigation period which could break the causal link. Regarding supply,
reference is made to recitals (128) and (129) above.

8.7.        Conclusion on causation

(134)   In the absence of any
further new and substantiated information or arguments, recitals (87) to (101)
of the provisional Regulation are hereby confirmed.

(135)   In the light of the above,
the provisional finding of the existence of a causal link between the material
injury suffered by the Union industry and the dumped Chinese imports is
confirmed.

9.           UNION INTEREST

9.1.        Developments after the
investigation period

(136)   As
from 9 November 2007 imports from the PRC were subject to registration pursuant
to the Commission Regulation (EC) No 1295/2007 of 5 November 2007 making
imports of certain prepared or preserved citrus fruits (namely mandarins, etc.)
originating in the People’s Republic of China subject to registration
('Registration Regulation').[14] This
was done with a view to the possible retroactive imposition of anti-dumping
duties. Consequently and exceptionally, developments after the IP have also
been analysed. Eurostat data confirms that
imports from China remain significant and this has been corroborated by certain
importers. The volume for the last ten months after the IP reached a level of
74.000 tonnes at stable low prices.

9.2.        Ability of Union producers
to supply the Union market

(137)   A number of parties
commented on the low level of the Spanish production, which they claimed is
unable to fully supply the Union market. While it is correct to state that in
the present situation the Union industry does not supply the overall EU market,
it should be noted that this fact is linked to the effect of injurious imports,
as explained above. In any event, the intended effect of the measures is not to
close the Union market to Chinese imports, but to remove the effects of
injurious dumping. Given inter alia, the existence of only two sources
of supply of these products, it is considered that in the event definitive
measures are imposed, Chinese products would continue to enjoy a significant
demand in the Union.

9.3.        Interest of the Union
industry and suppliers

(138)   One
importers' association alleged that any anti-dumping measures without any
limitation of quantities would not help protect the Spanish industry but would
automatically trigger illegal trading activities. This is an argument which
rather points to the need for the institutions to ensure proper monitoring of
the enforcement of measures, rather than against the benefit measures could
have for Union producers.

(139)   Another
importer argued that imposition of anti-dumping measures would not improve the
situation of the Spanish producers, due to the existence of large stocks built
by the importers in the EU, which would be able to satisfy the market demand in
the nearest future. The size of the stocks and the phenomenon of stockpiling
were supported by another importer. These comments confirm the Commission
analysis in the provisional Regulation and elsewhere in this Regulation.
However, it is recalled that measures are intended to provide relief from
injurious dumping over a period of five years—not only one.

(140)   In the absence of any other
new and substantiated information or argument in this respect, the conclusion
made in recitals (103) to (106) and (115) of the provisional Regulation
regarding the interest of the Union industry are hereby confirmed.

9.4.        Interest of unrelated
importers/traders in the Union

(141)   Cooperating importers
expressed a general interest in maintaining two sources of supply of the
product concerned, namely Spain and China, in order to maintain the security of
supply at competitive prices.

(142)   Nevertheless the majority of
the importers, should definitive measures be imposed, would prefer a measure
which contains also quantitative elements. This is not considered adequate, as
explained below in recital (156).

(143)   Data from the sampled
cooperating importers were verified and confirmed that the canned mandarins
sector represents less than 6% of their total turnover and that they achieved,
on average, a level of profitability exceeding 10% during both the
investigation period and the period of 2004-2008.

(144)   The foregoing underlines
that, on balance, the potential impact of measures on importers/traders would
not be disproportional to the positive effects emanating therefrom.

9.5.        Interest of users/retailers

(145)   One user, representing less
than 1% of consumption, submitted generic comments on the reduced availability
of mandarins in the EU and on the superior quality of the Chinese product. He
was invited to further cooperate providing individual data but declined and did
not substantiate his allegations. Another retailer, a member of the main
importer's association, generally opposed a price increase. No other submission
concerning the interest of users/retailers was received in the course of the
investigation. In this situation and in
absence of any substantiated comments from users/retailers, the conclusions
made in recitals (109) to (112) of the provisional Regulation are hereby
confirmed.

9.6.        Interest of consumers

(146)   Contrary to what was claimed
by one importer, the interest of consumers was taken into consideration at the
provisional stage. The Commission's findings were outlined in recitals (113)
and (114) of the provisional Regulation. Other parties suggested that the
impact on consumers would be significant. However, no information was provided
that could cast doubt on the findings in the aforementioned recitals. Even if
duties were to lead to an increase in consumer prices, no party has disputed
the fact that this product is a very small part of household food expenditure.
Therefore in the absence of any comments from consumers and of any further new
and substantiated information these recitals are confirmed.

9.7.        Conclusion on Union
interest

(147)   The additional analysis
above concerning the interests at stake has not altered the provisional
conclusions in this respect. Data of the sampled cooperating importers were
verified and confirmed that the canned mandarins sector represents for them
less than 6% of their total turnover and that they achieved, in average terms a
comfortable result during both the investigation period and the period of
2004-2008 examined, so the impact of the measures on importers will be minimal.
It has been also ascertained that the financial impact on the final consumer
would be negligible, considering that marginal quantities per capita are bought
in the consumer countries. It is considered that the conclusions regarding the
Union interest as set out in the provisional Regulation have not changed. In
the absence of any other comments, these conclusions set out in the provisional
Regulation are therefore definitively confirmed.

10.         DEFINITIVE MEASURES

10.1.      Injury elimination level

(148)   One importer claimed that
the profit margin at the level 6,8% used as reference at the provisional stage
is overestimated. In this respect it should be noted that the same level was
used and accepted for safeguard measures as the actual profit achieved by the
Union industry in the period 1998/ 99 to 2001/02. It refers to profits of the
Union producers in a normal trading situation before the increase in imports which
led to injury in the industry. The argument is therefore rejected.

(149)   Union producers claimed that
provisional duties did not take into account the peculiar situation of the
canned mandarins market, where the production is concentrated in only one country
and the vast majority of sales and of imports are concentrated in another
European country. For that it was requested that final calculations take into
account the transport cost from the producer country to the consumer country.
The claim was justified and warranted and calculations were adapted accordingly
to reflect the concentration of sales in the relevant areas of the Union.

(150)   One party made comments on
the undercutting and underselling calculation. Where warranted adjustments were
made at definitive stage.

(151)   The resulting injury
margins, taking into account, when warranted, the requests from interested
parties, expressed as a percentage of the total cif import value of each
sampled Chinese exporter were less than dumping margins found, as follows:

–
Yichang Rosen Foods Co., Ltd., Yichang, Zhejiang: 100,1%,

–
Huangyan No. 1 Canned Food Factory, Huangyan, Zhejiang: 48,4%,

–
Zhejiang Xinshiji Food Co., Ltd., Sanmen,
Zhejiang and related producer Hubei Xinshji Foods Co., Ltd., Dangyang City,
Hubei Province: 92,0%,

–
Co-operating exporting producers not included in
the sample: 90,6%,

All other companies: 100,1%.

10.2.      Retroactivity

(152)   As specified in recital (4),
on 9 November 2007 the Commission made imports of the product concerned
originating in the PRC subject to registration on the basis of a request by the
Union industry. This request has been withdrawn and therefore the matter has
not been further examined.

10.3.      Definitive measures

(153)   In view of the conclusions
reached with regard to dumping, injury, causation and Union interest, and in
accordance with Article 9(4) of the basic Regulation, a definitive anti-dumping
duty should be imposed at the level of the lowest of the dumping and injury
margins found, in accordance with the lesser duty rule. In this case, the duty
rate should accordingly be set at the level of the injury found.

(154)   On the basis of the above
and in line with corrigendum published in the Official Journal L 258[15] the definitive duty should
amount as follows:

–
 Yichang Rosen Foods Co., Ltd., Yichang, Zhejiang: 531,2 Eur/ton,

–
 Huangyan No.1 Canned Food Factory Huangyan, Zhejiang:361,4 Euro/ton,

–
 Zhejiang Xinshiji Foods Co., Ltd., Sanmen,
Zhejiang and its related producer Hubei      Xinshiji Foods Co., Ltd., Dangyang
City, Hubei Province: 490,7 Euro/Ton,

–
 Co-operating exporting producers not included
in the sample: 499,6 Euro/Ton,

All other companies: 531,2
Euro/Ton.

10.4.      Form of the measures

(155)   A number of parties
requested measures which combined price and quantity elements, whereby for an
initial import volume no duty or a reduced duty would be paid. In certain
cases, this was linked to a license system.

(156)   This
option was considered but rejected for, in particular, the following reasons.
Anti-dumping duties are imposed because the export price is lower than the
normal value. The amounts exported to the Union are relevant for the analysis whether dumped imports cause injury.
However, these amounts are, normally, irrelevant for the level of the duty that
should be imposed. In other words, if it is found that dumped imports cause
injury, the dumping may be offset by a duty which applies as of the first
shipment imported after the entry into force of the duty. Finally, to the
extent that it would be found that it is in the Union's interest that during a
certain period, products may be imported without imposing anti-dumping duties, Art.
14(4) of the basic Regulation allows for suspension under certain conditions.

(157)   Some parties have alleged that
any form of measures without a quantitative limitation will lead to duty
avoidance. Parties made reference again to the stockpiling which occurred in
the wake of the enlargement of the European Union on 1st May 2004. The
Commission services' analysis has confirmed that this was a clear attempt to
avoid the duties. Given these statements and the facts described in the
provisional Regulation in recitals (123) and (125), the Commission will monitor
developments in order to take the necessary actions to ensure proper
enforcement of measures.

(158)   Other parties have argued
that measures should exclude volumes already subject to existing sales
contracts. This would in practice amount to an exemption of duties which would
undermine the remedial effect of measures, and is therefore rejected. Reference
is also made to recitals (138) and (139) above.

(159)   The provisional Regulation
imposed an anti-dumping duty in the form of a specific duty for each company
resulting from the application of the injury elimination margin to the export
prices used in the calculation of the dumping during the IP. This methodology
is confirmed at the level of definitive measures.

10.5.      Undertakings

(160)   At a late stage in the
investigation several exporting producers in the PRC offered price
undertakings. These were not considered to be acceptable given the significant
price volatility of this product, the risk of duty avoidance and circumvention
for this product (see recitals (124) and (125) of the provisional Regulation),
and the fact that no guarantees were contained in the offers on the part of the
Chinese authorities to allow for adequate monitoring in a context of companies
not having been granted market economy treatment.

11.         REGISTRATION

(161)   Imports of the product
concerned were made subject to registration by Regulation 572/2012. That
registration should cease. The possibility of collecting retroactive duties
will be decided upon at a later stage, when full statistical data will be
available.

12.         DISCLOSURE

(162)   All parties were informed of
the essential facts and considerations on the basis of which it was intended to
impose a definitive anti-dumping duty on imports of the product concerned
originating in the People's Republic of China. The parties were also granted a
period within which they could make representations subsequent to the
disclosure. The parties who so requested were granted the opportunity to be
heard. Two groups of importers requested and were afforded hearings in the
presence of the Hearing Officer of the Directorate-General for Trade.

(163)   As regards the Xinshiji
judgment, the arguments brought forward had already been analysed and addressed
in the general disclosure document. None of these arguments led consequently to
the alteration of the essential facts and considerations on the basis of which
it was decided to confirm the injury margin determined in the original
investigation. With regard to the analogue country judgement, a group of
importers repeated comments already made during the investigation regarding the
scope of the partial reopening, the use of IP data and the determination of the
normal value. Those comments are addressed, respectively, in recitals (43),
(46) and (54) above. The same group of importers expressed the view that they
were in favour of a system of safeguard measures with quotas instead of
anti-dumping duties. The reason for rejecting a quota system is explained above
in recital (156). Furthermore it should be noted that safeguard measures can
only be imposed in certain situations with very specific conditions, in
compliance with Council Regulation 260/2009 of 26 February 2009. It is
considered that anti-dumping duties are the most appropriate way of addressing
injurious dumping. This group of importers also pointed out that, in relation with
the issues raised in recital (44) and (85) above, the Commission did not open
an interim review when requested to do so. It is reiterated that, as of the
date of the analogue country judgement, it was no longer possible to conduct an
interim review, as there was no more duty in force. The Commission should
resume the analysis of the pending request for interim review as of the date of
entry into force of this Regulation. If the analysis of the request shows that
the conditions set out in Article 11(3) of the basic Regulation are respected,
an interim review should be initiated as soon as possible.

(164)   In summary, after having
considered all the comments after disclosure to interested parties of the
findings of the investigation, it was concluded that none of them was of such a
nature as to change the conclusions reached during the investigation.

13.         DURATION OF MEASURES

(165)   In derogation of Article 11
(2) of the basic Regulation, this Regulation shall expire 5 years after the
entry into force of the original Regulation.

HAS ADOPTED THIS REGULATION:

Article 1

1.         A definitive anti-dumping duty
is hereby re-imposed on imports of prepared or preserved mandarins (including
tangerines and satsumas), clementines, wilkings and other similar citrus hybrids,
not containing added spirit, whether or not containing added sugar or other
sweetening matter, and as defined under CN heading 2008, currently falling
within CN codes 2008 30 55, 2008 30 75 and ex 2008 30 90 (TARIC codes 2008 30
90 61, 2008 30 90 63, 2008 30 90 65, 2008 30 90 67 and 2008 30 90 69) and originating
in the People's Republic of China.

2.         The amount of the definitive
anti-dumping duty applicable for products described in paragraph 1 produced by
the companies below shall be as follows:

Company || EUR/tonne net product weight || TARIC additional code

Yichang Rosen Foods Co., Ltd., Yichang, Zhejiang || 531,2 || A886

Huangyan No.1 Canned Food Factory, Huangyan, Zhejiang, || 361,4 || A887

Zhejiang Xinshiji Foods Co., Ltd., Sanmen, Zhejiang and its related producer Hubei Xinshiji Foods Co., Ltd., Dangyang City, Hubei Province || 490,7 || A888

Co-operating exporting producers not included in the sample as set out in the Annex || 499,6 || A889

All other companies || 531,2 || A999

Article 2

1.         In cases where goods have been
damaged before entry into free circulation and, therefore, the price actually
paid or payable is apportioned for the determination of the customs value
pursuant to Article 145 of Commission Regulation (EEC) No 2454/93[16] the amount of anti-dumping
duty, calculated on the basis of Article 1 above, shall be reduced by a
percentage which corresponds to the apportioning of the price actually paid or
payable.

2.         Unless otherwise specified, the
provisions in force concerning customs duties shall apply.

Article 3

The customs authorities are hereby directed
to cease the registration of imports carried out pursuant to Article 1 of
Regulation (EU) No 572/2012.

Article 4

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

Article 5

This Regulation shall
expire, in derogation from Article 11 (2) of the basic Regulation, on
31.12.2013.

Article 6

Requests for review
shall be admissible, in derogation from Article 11 (3) of the basic Regulation,
as of the entry into force of this Regulation.

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

Done at Brussels,

For
the Council

The
President

ANNEX

Co-operating exporting producers not
included in the sample (TARIC additional code A889)

Hunan Pointer Foods Co., Ltd., Yongzhou, Hunan

Ningbo Pointer
Canned Foods Co., Ltd., Xiangshan, Ningbo

Yichang Jiayuan Foodstuffs Co., Ltd., Yichang, Hubei

Ninghai Dongda Foodstuff Co., Ltd., Ningbo, Zhejiang

Huangyan No.2 Canned Food Factory, Huangyan, Zhejiang

Zhejiang Xinchang Best Foods Co., Ltd., Xinchang, Zhejiang

Toyoshima Share Yidu Foods Co., Ltd., Yidu, Hubei

Guangxi Guiguo Food Co., Ltd., Guilin, Guangxi

Zhejiang Juda Industry Co., Ltd., Quzhou, Zhejiang

Zhejiang Iceman Group Co., Ltd., Jinhua, Zhejiang

Ningbo Guosheng Foods Co., Ltd., Ninghai

Yi Chang Yin He Food Co., Ltd., Yidu, Hubei

Yongzhou Quanhui Canned Food Co., Ltd., Yongzhou, Hunan

Ningbo Orient Jiuzhou Food Trade &
Industry Co., Ltd., Yinzhou, Ningbo

Guangxi Guilin Huangguan Food Co., Ltd., Guilin, Guangxi

Ningbo Wuzhouxing Group Co., Ltd.,
Mingzhou, Ningbo

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

[2]               OJ C 246, 20.10.2007, p. 15.

[3]               OJ L 178, 5.7.2008, p. 19.

[4]               OJ L 288, 6.11.2007, p. 22.

[5]               OJ L 290, 8.11.2003, p. 3.

[6]               OJ L 104, 8.4.2004, p. 67.

[7]               OJ L 350, 30.12.2008, p. 35.

[8]               OJ C 103, 2.4.2011, p. 21.

[9]               OJ C 353, 3.12.2011, p. 15.

[10]             Judgement of the Court (third chamber) of 22 March 2012
in case C-338/10, GLS v Hauptzollamt Hamburg-Stadt.

[11]             OJ
C 175, 19.6.2012, p. 19

[12]             Case
T-2/95 Industrie des poudres sphériques (IPS) v Council [1998] ECR II-3939 and Case
C-458/98 P Industrie des poudres sphériques (IPS) v Council [2000] ECR I-08147.

[13]             Case T-2/95 Industrie des poudres sphériques (IPS)
v Council [1998] ECR II-3941.

[14]             OJ L 288 6.11.2007, p. 22.

[15]             OJ L 258, 26.9.2008, p. 74.

[16]             OJ L 253, 11.1.1993, p. 3.