**Case C-141/08 P**

**Foshan Shunde Yongjian Housewares & Hardware Co. Ltd**

**v**

**Council of the European Union**

(Appeals – Commercial policy – Dumping – Imports of ironing boards originating in China – Regulation (EC) No 384/96 – Articles 2(7)(c) and 20(4) and (5) – Market economy treatment – Rights of the defence – Anti‐dumping investigation – Periods granted to undertakings to submit their representations)

Summary of the Judgment

1.        *Common commercial policy – Protection against dumping – Anti-dumping proceeding – Rights of the defence – Communication of
the final disclosure documents by the Commission to the undertakings – Submission to the Council of the Commission’s proposal
for definitive measures less than ten days after that disclosure – Irregularity*

*(Council Regulation No 384/96, Art. 20(4) and (5))*

2.        *Common commercial policy – Protection against dumping – Anti-dumping proceeding – Rights of the defence – Commission decision
refusing to grant market economy treatment before the expiry of the period prescribed in Article 20(5) of Basic Anti-dumping
Regulation No 384/96 – Whether it is possible to have that decision annulled simply by demonstrating that, had there been
no such procedural error, the decision might have been different*

*(Council Regulation No 384/96, Art. 20(5))*

3.        *Common commercial policy – Protection against dumping – Dumping margin – Determination of the normal value – Investigation*

*(Council Regulation No 384/96, Art. 2(7)(c))*

1.        In order to comply with Article 20(4) and (5) of Basic Anti-dumping Regulation No 384/96, the Commission is required, when
it intends to increase the anti‐dumping duty by comparison with that envisaged in the initial final disclosure document, to
inform the undertakings concerned by sending a new final disclosure document to them and to wait for the expiry of the period
prescribed in Article 20(5) of that provision before sending its proposal for definitive measures to the Council, in order
to give those undertakings the opportunity to make representations.

That interpretation follows not only from the regulative context of which that provision forms part but is also necessary
in order to ensure that account is taken, in a manner that is effective and without prejudice, of any representations made
by the interested parties. The very fact that a proposal for definitive measures has already been put to the Council is, in
itself, capable of influencing the consequences that may be drawn from those representations. Finally, it cannot be that difficulties
encountered by the institutions in complying with the periods prescribed in Basic Anti-dumping Regulation No 384/96 should
result in an infringement of the periods prescribed for the protection of the rights of defence of the undertakings concerned.
On the contrary, the onus is on the institutions, in particular the Commission, to take account of the time constraints imposed
by the regulation while at the same time respecting the rights of defence of the undertakings concerned.

However, failure to comply with the 10-day period prescribed in Article 20(5) of Basic Anti-dumping Regulation No 384/96 can
result in annulment of the contested regulation only where there is a possibility that, due to that irregularity, the administrative
procedure could have resulted in a different outcome and thus in fact adversely affected the applicant’s rights of defence.

(see paras 74, 76, 78-79, 81)

2.        Respect for the rights of the defence is, in all proceedings initiated against a person which are liable to culminate in a
measure adversely affecting that person, a fundamental principle of Community law which must be guaranteed even in the absence
of any rules governing the proceedings in question. That principle requires that the addressees of decisions which significantly
affect their interests should be placed in a position in which they may effectively make known their views.

Respect for that principle is of crucial importance in anti-dumping proceedings. In order to secure the annulment of a Commission
decision not to grant it market economy treatment, adopted before the expiry of the period prescribed in Article 20(5) of
Basic Anti-dumping Regulation No 384/96, the undertaking concerned is not required to show that that decision would have been
different in content but simply that such a possibility cannot be totally ruled out, since it would have been better able
to defend itself had there been no procedural error.

(see paras 83-85, 89, 91, 93-94)

3.        If the Commission realises in the course of the anti-dumping proceeding that, contrary to its original assessment, an undertaking
meets the criteria laid down in the first subparagraph of Article 2(7)(c) of Basic Anti-dumping Regulation No 384/96 for the
undertaking to be granted market economy treatment, it must take appropriate action, while at the same time ensuring that
the procedural safeguards provided for in that regulation are observed.

It follows that the Commission can still alter its position when it realises that the substantive criteria laid down in that
provision were originally met. In the light of the principles of compliance with the law and sound administration, the last
sentence of Article 2(7)(c) of the Basic Anti‐dumping Regulation cannot be interpreted in such a manner as to oblige the Commission
to propose to the Council definitive measures which would perpetuate an error made in the original assessment of those substantive
criteria to the detriment of the undertaking concerned.

(see paras 111-112)


JUDGMENT OF THE COURT (First Chamber)

1 October 2009 ([\*](#Footnote*))

(Appeals – Commercial policy – Dumping – Imports of ironing boards originating in China – Regulation (EC) No 384/96 – Articles 2(7)( c) and 20(4) and (5) – Market economy treatment – Rights of the defence – Anti‐dumping investigation – Periods granted to undertakings to submit their representations)

In Case C‐141/08 P,

APPEAL under Article 56 of the Statute of the Court of Justice, lodged on 3 April 2008,

**Foshan Shunde Yongjian Housewares & Hardware Co. Ltd,** established in Foshan (China), represented by J.-F. Bellis, avocat, and G. Vallera, Barrister,

appellant,

the other parties to the proceedings being:

**Council of the European Union,** represented by J.-P. Hix, acting as Agent, and E. McGovern, Barrister, instructed by B. O’Connor, Solicitor,

defendant at first instance,

**Commission of the European Communities,** represented by H. van Vliet, T. Scharf and K. Talabér-Ritz, acting as Agents, with an address for service in Luxembourg,

**Vale Mill (Rochdale) Ltd,** established in Rochdale (United Kingdom),

**Pirola SpA,** established in Mapello (Italy),

**Colombo New Scal SpA,** established in Rovagnate (Italy),

represented by G. Berrisch, and G. Wolf, Rechtsanwälte,

**Italian Republic,** represented by R. Adam, acting as Agent, and W. Ferrante, avvocato dello Stato, with an address for service in Luxembourg,

interveners at first instance,

THE COURT (First Chamber),

composed of P. Jann, President of the Chamber, M. Ilešič (Rapporteur), A. Tizzano, A. Borg Barthet and E. Levits, Judges,

Advocate General: E. Sharpston,

Registrar: R. Şereş, Administrator,

having regard to the written procedure and further to the hearing on 25 March 2009,

after hearing the Opinion of the Advocate General at the sitting on 14 May 2009,

gives the following

**Judgment**

1        By its appeal, Foshan Shunde Yongjian Housewares & Hardware Co. Ltd. seeks to have set aside the judgment of the Court of
First Instance of the European Communities in Case T‐206/07 *Foshan Shunde Yongjian Housewares & Hardware* v *Council* [2008] ECR II‐1 (‘the judgment under appeal’), by which the Court of First Instance dismissed the action brought by the appellant
seeking annulment of Council Regulation (EC) No 452/2007 of 23 April 2007 imposing a definitive anti-dumping duty and collecting
definitively the provisional duty imposed on imports of ironing boards originating in the People’s Republic of China and Ukraine
(OJ 2007 L 109, p. 12) (‘the contested regulation’), inasmuch as it imposes an anti-dumping duty on imports of ironing boards
manufactured by the appellant.

**Legal context**

2        For the purposes of determining the existence of dumping, Article 2(1) to (6) of Council Regulation (EC) No 384/96 of 22 December
1995 on protection against dumped imports from countries not members of the European Community (OJ 1996 L 56, p. 1), as amended
by Council Regulation (EC) No 2117/2005 of 21 December 2005) (OJ 2005 L 340, p. 17) (‘the basic regulation’), lays down general
rules on the method to be used for determining what is known as the ‘normal value’.

3        Article 2(7)(a) of the basic regulation lays down a special rule on the method to be used for determining the normal value
for imports from non‐market economy countries.

4        However, Article 2(7)(b) of the basic regulation provides that the general rules laid down in Article 2(1) to (6) are to apply
to certain countries, including the People’s Republic of China, if it is shown on the basis of claims by one or more producers
subject to the investigation that market economy conditions prevail for that producer or producers.

5        The criteria and procedure for determining whether that is the case are set out in Article 2(7)(c) of the basic regulation.
That provision is worded as follows:

‘A claim under [Article 2(7)] (b) must be made in writing and contain sufficient evidence that the producer operates under
market economy conditions, that is if:

–        ...

–        firms have one clear set of basic accounting records which are independently audited in line with international accounting
standards and are applied for all purposes,

–        ...

A determination whether the producer meets the abovementioned criteria shall be made within three months of the initiation
of the investigation, after specific consultation of the Advisory Committee and after the Community industry has been given
an opportunity to comment. This determination shall remain in force throughout the investigation.’

6        The second paragraph of Article 20 of the basic regulation, which is entitled ‘Disclosure’, provides that the parties may
request final disclosure of the facts and considerations on the basis of which it is intended to recommend the imposition
of definitive measures. Article 20(4) and (5) provide as follows:

‘4.      Final disclosure shall be given in writing. It shall be made ... as soon as possible and, normally, not later than one month
prior to a definitive decision or the submission by the Commission of any proposal for final action pursuant to Article 9.
... Disclosure shall not prejudice any subsequent decision which may be taken by the Commission or the Council but where such
decision is based on any different facts and considerations, these shall be disclosed as soon as possible.

5.       Representations made after final disclosure is given shall be taken into consideration only if received within a period to
be set by the Commission in each case, which shall be at least 10 days, due consideration being given to the urgency of the
matter.’

**Background to the dispute**

7        The appellant, a company established in Foshan (China), manufactures and exports ironing boards to, inter alia, the European
Union.

8        As a result of complaints lodged by Vale Mill (Rochdale) Ltd, Pirola SpA and Colombo New Scal SpA (‘the intervening companies’),
on 4 February 2006 the Commission published a notice of initiation of an anti‐dumping proceeding concerning imports of ironing
boards originating in the People’s Republic of China and Ukraine (OJ 2006 C 29, p. 2).

9        On 23 February 2006, the appellant submitted a claim seeking market economy treatment under Article 2(7)(b) of the basic regulation.
In June 2006, the Commission carried out investigations at the appellant’s registered office and at that of a company linked
to the appellant for the purposes of establishing whether the appellant could be granted that status and determining the normal
value of the products in question on the Chinese market.

10      By letter of 11 August 2006, the Commission informed the appellant that it did not consider that it met the criterion laid
down in the second indent of the first subparagraph of Article 2(7)(c) of the basic regulation and that it could not therefore
be granted market economy treatment. In the Commission’s view, the appellant’s accounting records and the audit reports were
not in line with International Accounting Standards (‘IAS’). By letter of 15 September 2006, the Commission responded to the
representations made by the appellant by way of reply and informed it of its decision not to grant it market economy treatment.

11      On 30 October 2006, the Commission adopted Regulation (EC) No 1620/2006 imposing a provisional anti-dumping duty on imports
of ironing boards originating in the People’s Republic of China and Ukraine (OJ 2006 L 300, p. 13) (‘the provisional regulation’).
That regulation confirmed rejection of the appellant’s claim for market economy treatment and imposed a provisional duty of
18.1% on imports of ironing boards manufactured by it.

12      On 1 December 2006 and 18 January 2007, the appellant submitted written observations on the provisional regulation, including
observations on the issue of the determination of market economy treatment. It also submitted oral observations during a hearing
at the Commission’s headquarters on 19 January 2007. Subsequently, it sent to the Commission official statistics on Chinese
monthly imports of steel products during 2004 and 2005.

13      By letter of 20 February 2007, the Commission sent to the appellant a final general disclosure document and a specific final
disclosure document (together, ‘the final disclosure documents of 20 February 2007’). In the first document, the Commission
stated its intention to grant the appellant market economy treatment and, as a consequence, to reduce its definitive dumping
margin to 0%, in view of the fact that its claim was plausible and justified in the light of new information and explanations.

14      The Commission stated that the flaws in the company’s accounting practices noted at the provisional measures stage had no
significant impact on the financial results entered in the accounts and that the incompleteness of the accounts, first, did
not raise any problem as regards information on export sales, since the Commission had already approved those data when it
was in a position to check their reliability and, second, was not decisive as regards domestic sales, since they were not
sufficiently significant to be representative. The Commission therefore stated that, in those circumstances, the normal value
should be determined on the basis of production costs and that the cost of steel was an essential element of these. The Commission
considered that the Chinese official statistics relating to steel imports submitted during the administrative procedure confirmed
the reliability of the company’s accounting data with regard to the cost of steel and thus enabled the normal value to be
calculated on the basis of the value established in China.

15      By letter of 2 March 2007, the intervening companies which instigated the anti‐dumping proceeding submitted their observations
on the final general disclosure document of 20 February 2007. They maintained, first, that the appellant did not meet the
criterion set out in the second indent of the first subparagraph of Article 2(7)(c) of the basic regulation and, second, that
the last sentence of Article 2(7)(c) of the basic regulation precluded the institutions from altering the determination of
market economy treatment during the proceeding.

16      On 6 March 2007, the Advisory Committee set up under Article 15 of the basic regulation (‘the Advisory Committee’) examined
the working document that had been submitted to it by the Commission on 20 February 2007. A number of the members of the Advisory
Committee objected to the granting of market economy treatment to the appellant.

17      By fax of 23 March 2007, the Commission sent to the appellant a revised final general disclosure document and a revised specific
disclosure document (together, ‘the revised final disclosure documents of 23 March 2007’) from which it is apparent that the
Commission had reversed its position of 20 February 2007 as to whether to grant the appellant market economy treatment. It
considered, inter alia, that the appellant’s practice of offsetting and grouping sales transactions together in its accounts
on a summary basis, contrary to the accrual basis, constituted an infringement of the IAS, which was incompatible with the
requirements laid down in Article 2(7)(c) of the basic regulation.

18      On the same day, the Commission also sent to the members of the Advisory Committee the revised final working document for
consultation. That document was approved by the Advisory Committee on 27 March 2007 upon conclusion of a written procedure.

19      On 29 March 2007, the Commission submitted to the Council the proposal for definitive measures based on the revised final
general disclosure document of 23 March 2007.

20      The time-limit set for the appellant to submit its observations on the revised final disclosure documents of 23 March 2007
was 29 March 2007. That time-limit was extended by the Commission to 2 April 2007 at the appellant’s request.

21      The appellant submitted its observations on those documents on 2 April 2007. It challenged the Commission’s finding that it
did not meet the conditions for market economy treatment and requested the Commission not to accept the intervening companies’
submission that the last sentence of Article 2(7)(c) of the basic regulation precluded the Commission from altering its original
decision not to grant it that status.

22      The Commission replied by letter of 4 April 2007, reaffirming its findings as regards non-fulfilment of the conditions for
granting market economy treatment. It pointed out, moreover, that the case-law on the assessment of claims for that status
did not permit reassessment of old facts.

23      By letter of 5 April 2007, the appellant asked the Commission to propose to the Council definitive measures based on the final
general disclosure document of 20 February 2007, since the market economy treatment determination was, in the appellant’s
view, based on an error of law.

24      On 23 April 2007, the Council adopted the contested regulation, which imposed a definitive anti-dumping duty of 18.1% on imports
of ironing boards manufactured by the appellant.

**The proceedings before the Court of First Instance and the judgment under appeal**

25      By application lodged at the Registry of the Court of First Instance on 12 June 2007, the appellant brought an action for
the annulment of the contested regulation in so far as it imposes an anti‐dumping duty on imports of ironing boards manufactured
by it. On the same day, it applied for the proceedings to be expedited and its application was granted. The intervening companies
and the Italian Republic were granted leave to intervene in the proceedings before the Court of First Instance in support
of the form of order sought by the Council.

26      By the judgment under appeal, the Court of First Instance dismissed the appellant’s action, which was based on two pleas,
alleging, respectively, an error of law in the application of Article 2(7)(c) of the basic regulation and infringement of
the rights of the defence and of Article 20(5) of the basic regulation.

27      In support of its first plea, the appellant submitted that the only explanation supplied by the Commission to justify its
sudden change of position regarding the grant of market economy treatment was to be found in the letter of 4 April 2007, in
which the Commission stated that the case-law on the examination of claims for such status did not permit reassessment of
old facts. Article 2(7)(c) of the basic regulation, as interpreted in Case T‐138/02 *Nanjing Metalink* v *Council* [2006] ECR II‐4347, does not in any way preclude the Commission from being able, in circumstances such as those of the present
case, to alter its initial position. Moreover, the interpretation advocated by the Commission, in particular of the last sentence
of that provision, is also incompatible with the principle of sound administration. The proposal for definitive measures was
therefore based on an infringement of that provision, which in turn invalidates the contested regulation.

28      In its assessment of the first plea, the Court of First Instance sought to ascertain, at paragraphs 42 to 50 of the judgment
under appeal, whether the Commission revised its proposal in the final disclosure documents of 20 February 2007 on the ground
that it was not permitted to reassess old facts. It pointed out, first, that in the contested regulation, in particular in
recitals 12 to 14 in the preamble, the reason for the refusal to alter the market economy treatment determination made in
the provisional regulation was not the prohibition on the reassessment of old facts laid down in the last sentence of Article
2(7)(c) of the basic regulation, but the fact that the appellant’s accounts were not in line with the IAS and the absence
of any new evidence likely to affect that assessment.

29      The Court of First Instance went on to observe that it was not clear from the revised final disclosure documents of 23 March
2007 that the reason for the Commission’s decision not to grant the appellant market economy treatment was the prohibition
on reassessment of old facts.

30      Finally, the Court of First Instance pointed out that the only document in which the Commission states that the case-law relating
to the determination of market economy treatment does not permit a reassessment of old facts is the Commission’s letter of
4 April 2007. However, at paragraph 49 of the judgment under appeal, it considered that it is clear from that letter as a
whole that the Commission’s observation that it was not permissible to reassess old facts is incidental, as the institution
based its decision not to propose granting market economy treatment on an assessment of whether the appellant satisfied the
relevant substantive criteria.

31      The Court of First Instance concluded, at paragraph 50 of the judgment under appeal, that the appellant’s assertion that the
Commission based its arguments in this case on a prohibition on the reassessment of old facts has no basis in fact. It held,
on that ground, that the first plea could not be accepted and that any discussion concerning the interpretation of the last
sentence of Article 2(7)(c) of the basic regulation and of the judgment in *Nanjing Metalink* v *Council* was therefore irrelevant.

32      The Court of First Instance added, at paragraph 54 of the judgment under appeal, that the fact that the statement of reasons
in the contested regulation does not explain in what way the findings in the final general disclosure document of 20 February
2007 are unfounded and the fact, assuming it established, that the Commission provided no explanation in that regard are not
in themselves sufficient to render the contested regulation unlawful.

33      The second plea, alleging infringement of the right of the defence and of Article 20(5) of the basic regulation, was rejected
at paragraphs 63 to 76 of the judgment under appeal. The appellant argued that that infringement arises from the fact that
the Commission submitted to the Council the proposal for definitive measures based on the revised final general disclosure
document of 23 March 2007 barely six days after that document had been sent to the appellant, without waiting until the ten‐day
period prescribed in Article 20(5) of the basic regulation had expired, and four days before the date set by the Commission
for the appellant to submit its observations.

34      At paragraphs 63 to 70 of the judgment under appeal, the Court of First Instance held, first, that as a result of that action
the Commission did in fact infringe Article 20(5) of the basic regulation. It found, inter alia, that the Commission cannot
submit its proposal to the Council before the expiry of the 10-day period prescribed in that provision. According to the Court
of First Instance, that interpretation must be accepted in view of the wording of Article 20(4) of the basic regulation and
the need to interpret Article 20(4) and (5) of that provision in such a manner that those paragraphs are consistent with each
other and to ensure that any representations made by interested parties are actually taken into account by the Commission.
It therefore observed that the very fact that a proposal for definitive measures has already been submitted to the Council
is in itself likely to influence the conclusions that may be drawn from those representations.

35      Moreover, the Court of First Instance held, in that connection, that the Commission was required to inform the parties concerned
that it had adopted a new position, as set out in the revised final disclosure documents of 23 March 2007. The Court of First
Instance stated that since it makes express reference to ‘different facts and considerations’, Article 20(4) of the basic
regulation does not support the view put forward by the Commission that mere alteration of the assessment of factual information
that remains unchanged does not require any communication to the interested parties.

36      However, the Court of First Instance found, at paragraphs 71 to 76 of the judgment under appeal, that the infringement of
Article 20(5) of the basic regulation did not affect the content of the contested regulation and hence the applicant’s rights
of defence and could not, therefore, result in the unlawfulness and annulment of that regulation. Thus, it pointed out that
such an infringement could result in annulment of the contested regulation only if it were possible that, due to that irregularity,
the outcome of the administrative procedure might have been different and thus in fact adversely affected the appellant’s
rights of defence.

37      The Court of First Instance stated that, so far as the question of determining market economy treatment is concerned, the
case file does not show that the revised final disclosure documents of 23 March 2007 contained new factual information that
had not previously been brought to the attention of the appellant. It observed that in those documents the Commission merely
informed the appellant of its intention to change its earlier position and thus maintain the decision originally adopted on
15 September 2006 and implemented in the provisional regulation. The appellant had already had the opportunity, at an earlier
stage in the administrative procedure, to give its view on the position set out once again in those documents.

38      The Court of First Instance found at paragraph 75 of the judgment under appeal that the appellant’s observations in its letter
of 2 April 2007 concerning the application of the last sentence of Article 2(7)(c) of the basic regulation and the judgment
in *Nanjing Metalink* v *Council* did not, in any event, influence the content of that regulation since, as was found in the context of the first plea, the
decision not to grant market economy treatment was based on the application of the substantive criteria.

**The appeal**

39      The appellant asks the Court to set aside the judgment under appeal and to grant the form of order sought by it before the
Court of First Instance, namely to annul the contested regulation in so far as it applies to the appellant.

40      The Council, the intervening companies and the Italian Republic contend that the appeal should be dismissed. The Commission
asks the Court to declare the appeal inadmissible or to dismiss it.

41      The appellant puts forward two grounds of appeal, alleging, respectively, an incorrect assessment of the importance of the
discussion concerning the interpretation of Article 2(7)(c) of the basic regulation as a result of manifest distortion of
the documents in the case-file and an incorrect conclusion as to the effect of the infringement of Article 20(5) of that regulation.

*The first ground of appeal*

 Arguments of the parties

42      By its first ground of appeal, the appellant submits that the Court of First Instance failed properly to address the first
plea for annulment, which it rejected on the basis of a finding that is clearly at odds with the documents in the case‐file,
namely that the discussion concerning the interpretation of Article 2(7)(c) of the basic regulation and paragraph 44 of *Nanjing Metalink* v *Council* was irrelevant for the purposes of this case.

43      The first part of this ground of appeal alleges that, since the substantive inaccuracy of that finding is apparent from documents
on the case‐file, in particular the pleadings of the Council and the Italian Republic, the Court of First Instance erred in
law.

44      The appellant thus submits that the Council itself recognised that it was precisely because the Commission considered that
the conditions necessary for altering the position originally adopted, as set out in *Nanjing Metalink* v *Council*, were not met that it reverted to that position. The Italian Republic also confirmed that the question of the interpretation
of the last sentence of Article 2(7)(c) of the basic regulation in the light of *Nanjing Metalink* v *Council* in fact played a decisive role in the Commission’s decision to propose definitive measures based on its original position.
In those circumstances and in the absence of new factual information in the revised final disclosure documents of 23 March
2007, which the Court of First Instance itself commented upon at paragraph 72 of the judgment under appeal, that court’s finding
that the question was merely ‘incidental’ is manifestly incorrect.

45      In the second part of the first ground of appeal, the appellant submits that the Court of First Instance was wrong not to
rule on that question.

46      The Council is of the view that, due to its selective nature, the first ground of appeal cannot cast doubt on the Court of
First Instance’s assessment of the facts. The arguments put forward by the appellant in that connection fail to take account
of all the evidence on the case‐file and omit in particular to refer to the three documents relied on by the Court of First
Instance. Moreover, the defence lodged by the Council in the proceedings before the Court of First Instance does not contain
any evidence. The Council also disputes that the interpretation of Article 2(7)(c) of the basic regulation had a significant
impact on the present case because the outcome of any interpretation would be the same. In any event, irrespective of whether
the interpretation had a significant impact, it is not possible to conclude that the Commission accepted the argument that
it was not permitted to alter its original decision.

47      The Commission entertains doubts as to the probative force of the representations made by the Council and the Italian Republic
in that context since they are not a party to the proceedings and are therefore ill‐placed to judge the grounds which led
the Commission to revert to its original position. In any event, those representations do not prove that the Court of First
Instance distorted the evidence. In fact, in taking the decision to revert to its original position, the Commission took into
account the new evidence provided by the appellant but concluded, in the light of all the representations made, considered
as a whole, that notwithstanding that evidence, market economy treatment could not be granted in view of the substantial deficiencies
in the appellant’s accounts. The proposal for definitive measures was therefore based, not on any prohibition on altering
the original decision not to grant that status, but on the conclusion that the appellant did not meet the relevant substantive
criteria. The Commission maintains that it would have altered its original decision if it had been convinced that the appellant
had put forward new evidence justifying the grant of that status.

48      The Italian Republic submits that the Court of First Instance was correct in finding that there were no new facts or new documents
capable of justifying the Commission changing its original decision concerning the grant of market economy treatment. Accordingly,
the Commission based its conclusion, which led it to confirm its original decision, not only on the prohibition on changing
its opinion but also on the decisive consideration that the serious irregularities which had been established could not be
disregarded as a result of new evidence. The Commission’s letter of 4 April 2007 sets out at considerable length the numerous
reasons which led it to confirm its original decision. The fact that, in the circumstances, the conditions under which the
Commission would have been permitted exceptionally to change its position on granting market economy treatment were not met
is but one of those reasons.

49      The intervening companies submit that the first ground of appeal is manifestly unfounded in so far as the appellant has failed
to demonstrate that the Court of First Instance distorted the evidence produced before it. The appellant has failed in particular
to refute the Court of First Instance’s detailed assessment of the relevant documents, which is sufficient for the first ground
of appeal to be rejected. Moreover, neither the pleadings lodged by the Council and the Italian Republic before the Court
of First Instance nor paragraph 72 of the judgment under appeal, to which the appellant refers, support the conclusions which
it seeks to draw from them. The appellant companies submit, in the alternative, that the appellant’s interpretation of *Nanjing Metalink* v *Council* is incorrect.

 Findings of the Court

50      The first ground of appeal relied on by the appellant, arguing that the Court of First Instance erred in considering that
it was not required to rule on the question of the interpretation to be given to the last sentence of Article (2)(7)(c) of
the basic regulation, is based on the assertion that the Court of First Instance distorted the evidence in the case‐file in
reaching the conclusion that, in the circumstances, the Commission did not base its decision on the fact that it was not permitted
to reassess old facts and that any discussion of that question was therefore irrelevant.

51      It should be noted that the Court of First Instance based its decision on recitals 12 and 14 in the preamble to the contested
regulation, on the revised final disclosure documents of 23 March 2007 and on the Commission’s letter of 4 April 2007.

52      The Court of First Instance stated, at paragraphs 43 to 45 of the judgment under appeal, that it was not clear from the contested
regulation or the revised final disclosure documents of 23 March 2007 that the reason for the Commission’s refusal to grant
the applicant market economy treatment was the prohibition on reassessment of old facts. In that context, the Court of First
Instance observed, inter alia, that those documents justified the refusal to grant that status because the appellant’s accounting
practices were not in line with the IAS and were therefore based on a substantive criterion. The appellant has not called
into question those findings.

53      The Court of First Instance pointed out at paragraphs 46 and 47 of the judgment under appeal that the Commission’s letter
of 4 April 2007 in fact referred to the case‐law of that court prohibiting reassessment of old facts. However, the Court of
First Instance also stated, at paragraph 48 of that judgment, that in that letter the Commission based its decision not to
grant market economy treatment on the ground that, first, the appellant’s accounts did not comply with the IAS and, second,
that it was not possible, on the basis of the information on steel prices, for a new assessment to be made of the shortcomings
discovered in the those accounts.

54      The appellant does not dispute those findings but disagrees with the Court of First Instance’s assessment, which is based
on those findings, at paragraph 49 of the judgment under appeal that it is clear from that letter as a whole that the Commission’s
observation that it was not permissible to reassess old facts is incidental, as the Commission based its decision not to propose
granting market economy treatment on an assessment of whether the appellant complied with the relevant substantive criteria.

55      The appellant is therefore requesting the Court to substitute its own assessment for that made by the Court of First Instance.

56      However, according to the established case‐law of the Court of Justice, the Court of First Instance has exclusive jurisdiction
to find the facts, save where a substantive inaccuracy in its findings is attributable to the documents submitted to it, and
to appraise those facts. That appraisal thus does not, save where the clear sense of the evidence has been distorted, constitute
a point of law which is subject, as such, to review by the Court of Justice (see Case C‐390/95 P *Antillean Rice Mills and Others* v *Commission* [1999] ECR I‐769, paragraph 29; Case C‐237/98 P *Dorsch Consult* v *Council and Commission* [2000] ECR I‐4549, paragraph 35; and Case C‐425/07 P *AEPI* v *Commission* [2009] ECR I‐0000, paragraph 44).

57      In so far as concerns the Commission’s letter of 4 April 2007, the Court of First Instance did not distort its content. As
pointed out by the Advocate General at points 77 and 78 of her Opinion, while it would be possible to interpret that letter
in the manner advocated by the appellant, the fact nevertheless remains that such an interpretation is not the only possible
conclusion to be drawn from the text of that letter.

58      Moreover, the Court cannot accept the appellant’s argument that the only possible explanation for the change in the Commission’s
position is that it allowed itself to be convinced by the arguments put forward by the intervening companies and some Member
States within the anti‐dumping committee, which maintained that the last sentence of Article 2(7)(c) of the basic regulation
precluded the Commission from altering its original decision not to grant the appellant market economy treatment.

59      As the Court of First Instance pointed out at paragraph 14 of the judgment under appeal, the intervening companies based their
representations regarding the final general disclosure document of 20 February 2007, submitted by letter of 2 March 2007,
primarily on the argument that the appellant did not meet the substantive criterion set out in the second indent of the first
subparagraph of Article 2(7)(c) of the basic regulation.

60      It is apparent from that letter that the intervening companies argued, inter alia, that that criterion must be interpreted
strictly and, for the purpose of assessing that criterion, it is irrelevant whether the flaws in the appellant’s accounts,
which were not disputed by the appellant and are in breach of the IAS in a number of respects, actually had an impact on the
results entered in the accounts. They also submitted that the appellant’s explanations in that regard are in any event incorrect
and that the Commission did not provide any explanation as to the reason why it accepted them. Finally, they argued that the
evidence of prices of Chinese steel imports was irrelevant to the question whether the appellant’s accounts were consistent
with the IAS and that, in any event, the appellant mainly used exclusively domestic steel.

61      The Commission explained in the statement in intervention which it lodged with the Court of First Instance that, as a result
of the representations made by the intervening companies and the doubts expressed by some Member States at the idea that market
economy treatment might be granted to the appellant on the basis of figures provided by it on the price of steel imports from
China, it continued to reflect on the matter. In the light of those representations, it reached the conclusion that, in view
of the deficiencies established in the appellant’s accounts, it was not possible for it to consider on the basis of those
figures that the criterion laid down in the second indent of the first subparagraph of Article 2(7)(c) of the basic regulation
was met and that it therefore had no option but to refuse to grant that status to the appellant. The Commission also points
out, in that connection, that it did not consider itself to be under any obligation to propose to the Council measures which
it knew to be incorrect and that it is of the view that *Nanjing Metalink* v *Council* cannot be interpreted as imposing such a restriction.

62      Accordingly, the Court of First Instance was entitled to conclude, on the basis of the documents on the case‐file, that, contrary
to the appellant’s submissions, the reason for the change in the Commission’s position between the final disclosure documents
of 20 February 2007 and the revised final disclosure documents of 23 March 2007 was not because it was prohibited from changing
the original decision not to grant that status to the appellant but as a result of considerations relating to the interpretation
of the substantive criterion laid down in the second indent of the first subparagraph of Article 2(7)(c) of the basic regulation.

63      Moreover, that finding is not called into question by the appellant’s argument that the content of the submissions at first
instance of the Council and the Italian Government show that the reason for the change of position was the prohibition on
changing the original decision. As the Advocate General stated at paragraphs 79 and 80 of her Opinion, even if those submissions
could be regarded as ‘evidence’, the fact remains that other evidence on the case‐file, in particular the statement in intervention
lodged by the Commission before the Court of First Instance, indicates that the outcome of those submissions was the opposite
of what the appellant contends. Given that the submissions of the Council and the Italian Republic have no absolute probative
force and the Court of First Instance is required to make a global appraisal of all the evidence before it, that court cannot
be said to have distorted that evidence by accepting, in essence, the explanation provided by the Commission itself for its
change of position rather than the explanation allegedly suggested by parties who are not party to the Commission’s internal
decision‐making process.

64      The Court of First Instance cannot therefore be said to have distorted the evidence before it by finding that there is no
factual basis for the appellant’s claim that the Commission’s decision in the present case was based on a prohibition on the
reassessment of old facts.

65      It follows from the foregoing that the first ground of appeal must be rejected.

*The second ground of appeal*

 Arguments of the parties

66      By its second ground of appeal, the appellant submits that the Court of First Instance erroneously concluded that the breach
of its rights of defence, established by that court, could not result in annulment of the contested regulation on the ground
that there was, in any event, no possibility that the administrative procedure could have resulted in a different outcome.
Since the question of the interpretation of Article 2(7)(c) of the basic regulation is not an incidental but a fundamental
issue, that breach deprived the appellant of the opportunity to demonstrate to the Commission that its interpretation was
incorrect and that the Commission was perfectly entitled to propose to the Council definitive measures based on the conclusions
in the final general disclosure document of 20 February 2007. The appellant’s situation was therefore adversely affected since
it was deprived of the possibility of a radically different outcome to the administrative procedure.

67      The Council, supported by the Commission, the intervening companies and the Italian Republic, endorses the Court of First
Instance’s finding that infringement of Article 20(5) of the basic regulation should not result in annulment of the contested
regulation because, in the present case, there was no infringement of the appellant’s rights of defence.

68      According to those parties, the second ground of appeal is based on incorrect premisses, in particular that the appellant
could have put forward new arguments which might have led the Commission to change its opinion, that the reason for the Commission’s
decision to revert to its original position was the prohibition on altering that position and that the Court of First Instance
found that the appellant’s rights of defence had been infringed. The Commission concludes that the second ground of appeal
is inadmissible or ineffective. The intervening companies maintain that it is manifestly inadmissible or unfounded and also
argue that the appellant fails to identify the finding in the judgment under appeal which it disputes and does not state clearly
the error in law for which it criticises the Court of First Instance.

69      However, the Council, the Commission and, as an alternative plea, the intervening companies take issue with the Court of First
Instance’s interpretation of Article 20(4) and (5) of the basic regulation that that provision imposes a 10-day period within
which representations are to be made in all cases when the Commission bases its decision on facts or considerations different
from those in the final disclosure document. That interpretation does not follow from the wording of Article 20(4) of the
basic regulation, is disproportionate and gives rise to considerable practical difficulties for the Commission vis-à-vis the
express time‐periods prescribed in that regulation.

70      The Commission submits, inter alia, that the revised final disclosure documents of 23 March 2007 constitute, essentially,
a form of ‘disclosure’ for the purpose of Article 20(4) of the basic regulation and not a form of ‘final disclosure’ for the
purpose of Article 20(5) of the regulation and therefore the period prescribed in Article 20(5) is not applicable.

71      Furthermore, the Council submits that the general rights of the defence continue to apply regardless of the interpretation
to be given to Article 20(5) of the basic regulation and that the periods available under those rights depend on the circumstances
of the individual case. A period of 10 days following notification by the Commission of facts and considerations different
from those in the final disclosure document is not always necessary for the purpose of ensuring that the rights of the defence
are respected.

 Findings of the Court

72      The second ground of appeal is directed against the Court of First Instance’s finding at paragraph 76 of the judgment under
appeal that the infringement by the Commission of Article 20(5) of the basic regulation did not affect the content of the
contested regulation and hence the applicant’s rights of defence.

73      As a preliminary point, it should be noted that, contrary to the submissions of the Council and the Commission in particular,
the Court of First Instance did not err in law in finding, at paragraph 70 of the judgment under appeal, that the Commission
infringed Article 20(5) of the basic regulation by sending its proposal for definitive measures to the Council only six days
after communicating to the appellant the revised final disclosure documents of 23 March 2007 and thus before the expiry of
the 10-day period laid down in that provision.

74      The Court of First Instance was correct in stating that the Commission was required in the circumstances to inform the appellant
of its new position, as set out in the revised final disclosure documents of 23 March 2007, and that in sending those documents
it was required to comply with the period prescribed in Article 20(5) of the basic regulation.

75      It is clear, first, that, contrary to what the Commission and the Council tend to suggest, in the present case the question
does not arise as to whether even the most minor change in a final disclosure document must also be classified as a form of
‘disclosure’ within the meaning of that provision, requiring compliance with the period prescribed in the provision.

76      In that context, it is sufficient to state that in the present case what is at issue is not such a minor change but a fundamental
change of position on the part of the Commission between the communication of the final disclosure documents of 20 February
2007 and the communication of the documents of 23 March 2007, that change having important consequences for the appellant,
entailing in particular the proposal for a definitive anti‐dumping duty of 18.1% rather than 0%, as envisaged in the initial
final disclosure document.

77      Next, the Court of First Instance was correct in finding that, since Article 20(5) of the basic regulation is applicable,
it was not permissible for the Commission to send its proposal to the Council before the expiry of the period laid down in
that provision.

78      As the Court of First Instance pointed out, that interpretation follows not only from regulative context of which that provision
forms part but is also necessary in order to ensure that account is taken, in a manner that is effective and without prejudice,
of any representations made by the interested parties. The very fact that a proposal for definitive measures has already been
put to the Council is, in itself, capable of influencing the consequences that may be drawn from those representations.

79      Finally, it cannot be that difficulties encountered by the institutions in complying with the periods prescribed in the basic
regulation should result in an infringement of the periods prescribed in that regulation for the protection of the rights
of defence of the undertakings concerned. On the contrary, the onus is on the institutions, in particular the Commission,
to take account of the time constraints imposed by the regulation while at the same time respecting the rights of defence
of those undertakings.

80      Moreover, in the present case the Commission itself granted the appellant a period of 10 days, which the Commission must respect
if it is not to be in breach of the principle of sound administration.

81      As regards the arguments put forward by the appellant in support of its second ground of appeal, it should be noted at the
outset that the Court of First Instance was correct in finding at paragraph 71 of the judgment under appeal that failure to
comply with the 10-day period prescribed in Article 20(5) of the basic regulation can result in annulment of the contested
regulation only where there is a possibility that, due to that irregularity, the administrative procedure could have resulted
in a different outcome and thus in fact adversely affected the applicant’s rights of defence (see, to that effect, Case 30/78
*Distillers Company* v *Commission* [1980] ECR 2229, paragraph 26; Case C‐142/87 *Belgium* v *Commission, ‘Tubemeuse’* [1990] ECR I‐959, paragraph 48; and Case C‐194/99 P *Thyssen Stahl* v *Commission* [2003] ECR I‐10821, paragraph 31).

82      However, since the appellant submits that the Court of First Instance erred in law in applying that case‐law, it is necessary
to consider whether that court was entitled, on the basis of the reasoning set out at paragraphs 72 to 75 of the judgment
under appeal, to reach the conclusion that, in the present case, the appellant’s rights of defence were not adversely affected.

83      According to settled case‐law, respect for the rights of the defence is, in all proceedings initiated against a person which
are liable to culminate in a measure adversely affecting that person, a fundamental principle of Community law which must
be guaranteed even in the absence of any rules governing the proceedings in question. That principle requires that the addressees
of decisions which significantly affect their interests should be placed in a position in which they may effectively make
known their views (see, inter alia, Case C‐32/95 P *Commission* v *Lisrestal and Others* [1996] ECR I‐5373, paragraph 21; Case C‐462/98 P *Mediocurso* v *Commission* [2000] ECR I‐7183, paragraph 36; and Case C‐287/02 *Spain* v *Commission* [2005] ECR I‐5093, paragraph 37).

84      As is apparent from the findings of the Court of First Instance, in its letter of 2 April 2007, by which it submitted its
observations on the revised final disclosure documents of 23 March 2007, the appellant put forward arguments relating both
to whether it met the substantive criterion laid down in the second indent of the first subparagraph of Article 2(7)(c) of
the basic regulation and whether, in the light of the last sentence of Article 2(7)(c), the Commission is bound in law by
its original decision not to grant market economy treatment.

85      Moreover, it is not disputed that, in spite of the fact that that letter was sent to the Commission within the period laid
down in Article 20(5) of the basic regulation, the Commission was unaware, as a result of its failure to comply with that
period, of the content of that letter when it sent the proposal for definitive measures to the Council.

86      With regard, first, to the arguments set out in that letter relating to the substantive criterion laid down in the second
indent of the first subparagraph of Article 2(7)(c) of the basic regulation, the Court of First Instance found, at paragraphs
72 to 74 of the judgment under appeal, that those arguments could not affect the content of the contested regulation for three
reasons.

87      First, the case file does not show that the revised final disclosure documents of 23 March 2007 contained new factual information
that had not previously been brought to the attention of the appellant. Next, the appellant had the opportunity at an earlier
stage in the administrative procedure to give its view on the position set out once more in those documents. Finally, the
letter of 2 April 2007 shows that the appellant did not put forward new arguments in response to the position adopted by the
Commission.

88      Clearly, those reasons alone are not sufficient to rule out the possibility that the outcome of the administrative procedure
could have been different if the Commission had been aware of the letter of 2 April 2007 before sending its proposal for definitive
measures to the Council.

89      It should be noted in particular that, as stated at paragraph 61 above, the Commission itself explained in the statement in
intervention which it lodged with the Court of First Instance that it was only after receiving the observations of the intervening
companies and certain Member States that it changed the decision contemplated in the final disclosure documents of 20 February
2007 to grant the appellant market economy treatment.

90      It is therefore not disputed that the Commission changed its decision not on the grounds which supported its original decision
not to grant that status to the appellant but in the light of the arguments presented to it by the intervening companies and
certain Member States. Nor is it disputed that the purpose of those arguments was to show that the observations and documents
submitted by the appellant should not have led the Commission to alter its original decision not to grant that status.

91      In those circumstances, it cannot be maintained on the basis of the reasons set out at paragraphs 72 to 74 of the judgment
under appeal that the appellant’s rights of defence were not in fact adversely affected by the fact that it was not given
the opportunity effectively to make known its views on the issues raised in those arguments, in particular the issue as to
whether, notwithstanding certain deficiencies in the appellant’s accounts, it could have been granted market economy treatment
on the basis of figures on the price of steel imported into China which it had provided during the administrative procedure.

92      In particular, in light of the conduct of that procedure and the fact that the Commission had already altered its position
twice as a result of the observations submitted to it by the interested parties, it cannot be ruled out that the Commission
might have altered its position once again because of the arguments put forward by the appellant in its letter of 2 April
2007, which related, according to the findings set out at paragraph 74 of the judgment under appeal, to the significance to
be attached to the accounting shortcomings discovered and the inferences to be drawn from the information on the price of
steel imports.

93      Respect for the rights of the defence is of crucial importance in procedures such as that followed in the present case (see,
to that effect, Case C‐49/88 *Al-Jubail Fertilizer* v *Commission* [1991] ECR I‐3187, paragraphs 15 to 17, and by analogy, Case C‐113/04 P *Technische Unie* v *Commission* [2006] ECR I‐8831, paragraph 55).

94      Moreover, according to the case‐law of the Court of Justice, the appellant cannot be required to show that the Commission’s
decision would have been different in content but simply that such a possibility cannot be totally ruled out, since it would
have been better able to defend itself had there been no procedural error (see *Thyssen Stahl* v *Commission*, paragraph 31 and the case‐law cited).

95      Second, as regards the arguments put forward by the appellant in the letter of 2 April 2007 relating to whether the Commission
is bound in law, in the light of the last sentence of Article 2(7)(c) of the basic regulation, by its original decision not
to grant it market economy treatment, the Court of First Instance found at paragraph 75 of the judgment under appeal that
those arguments did not, in any event, influence the content of the contested regulation since the decision not to grant that
status was based on application of the substantive criterion.

96      The simple fact that the Commission based its decision not to grant that status in the revised final disclosure documents
of 23 March 2007 on the substantive criterion in the second indent of the first subparagraph of Article 2(7)(c) of the basic
regulation is not sufficient to rule out the possibility that the arguments concerning interpretation of the last sentence
of Article 2(7)(c), which the appellant had the opportunity to put forward for the first time in that letter, could have influenced
the content of the proposal for definitive measures.

97      Since it cannot be ruled out, as pointed out at paragraph 92 above, that the Commission would have altered its position once
again as a result of the appellant’s representations concerning the substantive criterion in its letter of 2 April 2007, the
question whether the Commission could still alter its original refusal decision, notwithstanding the wording of the last sentence
of Article 2(7)(c) of the basic regulation, was of particular importance.

98      Accordingly, even if the Commission had ultimately been convinced that the appellant met the substantive criterion, it could
have proposed that it be granted market economy treatment only if it had been persuaded that, contrary to the arguments put
forward by certain Member States and the intervening companies, it was not bound in law by its original decision not to grant
that status.

99      Furthermore, contrary to the Court of First Instance’s finding at paragraph 75 of the judgment under appeal, the relevance
of that question is not in any way negated by the finding made at paragraphs 48 and 49 of that judgment that the Commission’s
observation in its letter of 4 April 2007 was merely incidental in so far as it stated that it was not permissible to alter
its original decision not to grant the appellant market economy treatment.

100    Admittedly, as the Court of First Instance was able to conclude at paragraph 50 of the judgment under appeal, it was possible
as a result of that finding to reject the first plea in law, which was based on the premiss that the Commission had reverted
to its original decision not to grant the appellant the status in question on the ground that it was prohibited from altering
the decision.

101    However, that finding is not sufficient to show, in connection with the examination of the second plea, that the appellant’s
rights of defence were not adversely affected by the infringement of Article 20(5) of the basic regulation.

102    As pointed out at paragraph 78 above, the fact that the Commission submitted a proposal for definitive measures to the Council
before receiving the appellant’s letter of 2 April 2007 is likely to influence the conclusion which it could still have drawn
from the observations in that letter. Had the Commission been aware of those observations before submitting its proposal for
definitive measures, it would have had greater room for manoeuvre in its assessment of those measures and might have reached
other conclusions, including as to whether it was permissible for it to alter its original decision not to grant the appellant
market economy treatment.

103    It is clear that, in those circumstances, the Court of First Instance was not entitled to confine itself, as it did at paragraph
75 of the judgment under appeal, to referring to paragraphs 48 and 49 of that judgment and thus to the content of the Commission’s
letter of 4 April 2007. Since, that letter was formulated only after the Commission had already sent its proposal for definitive
measures to the Council and thus after it had infringed Article 20(5) of the basic regulation, the Court of First Instance
should have considered whether the content of that proposal and of that letter might have been different if that provision
had not been infringed.

104    It follows from the foregoing that the Court of First Instance was not entitled, on the basis of paragraphs 72 to 75 of the
judgment under appeal, to rule out the possibility that the infringement by the Commission of Article 20(5) of the basic regulation
was likely to affect the content of the contested regulation and, therefore, the appellant’s rights of defence. Since the
Court of First Instance therefore erred in law, the second ground of appeal must be upheld.

105    The judgment under appeal must therefore be set aside in so far as the Court of First Instance found that the appellant’s
rights of defence were not adversely affected by the infringement of Article 20(5) of the basic regulation.

**The action before the Court of First Instance**

106    In accordance with the second sentence of the first paragraph of Article 61 of the Statute of the Court of Justice, if the
decision of the Court of First Instance is set aside, the Court of Justice may give final judgment in the matter where the
state of the proceedings so permits. That is the case here.

107    As stated at paragraph 81 above, failure to comply with the 10-day period prescribed in Article 20(5) of the basic regulation
can result in annulment of the contested regulation only where there is a possibility that, due to that irregularity, the
administrative procedure could have resulted in a different outcome and thus in fact adversely affected the applicant’s rights
of defence.

108    It is therefore necessary to consider whether it can be ruled out that there was such a possibility in the present case.

109    That would be the case if, even supposing that the Commission had been persuaded by the letter of 2 April 2007 that the appellant
met the substantive criterion laid down in the second indent of the first subparagraph of Article 2(7)(c) of the basic regulation,
it was prohibited under the last sentence of Article 2(7)(c) from altering its original decision not to grant the applicant
market economy treatment.

110    The last two sentences of Article 2(7)(c) of the basic regulation provide that a determination whether the producer meets
the substantive criteria laid down in that provision is to be made within three months of the initiation of the investigation
and that the determination is to remain in force throughout the investigation.

111    In the light of the principles of compliance with the law and sound administration, that provision cannot be interpreted in
such a manner as to oblige the Commission to propose to the Council definitive measures which would perpetuate an error made
in the original assessment of those substantive criteria to the detriment of the undertaking concerned.

112    Accordingly, if the Commission realises in the course of the investigation that, contrary to its original assessment, an undertaking
meets the criteria laid down in the first subparagraph of Article 2(7)(c) of the basic regulation, it must take appropriate
action, while at the same time ensuring that the procedural safeguards provided for in the basic regulation are observed.

113    It follows that the Commission could still have altered its position following receipt of the appellant’s letter of 2 April
2007.

114    Since it cannot therefore be ruled out that the Commission would have proposed to the Council definitive measures more advantageous
to the appellant if it had been aware of the content of that letter and that, in that case, the Council would have accepted
such a proposal, it is clear that the appellant’s rights of defence were in fact adversely affected by the failure to comply
with the 10‐day period prescribed in Article 20(5) of the basic regulation, which led to the Commission not taking account
of the content of that letter at the appropriate time.

115    The contested regulation must therefore be annulled in so far as it imposes an anti‐dumping duty on imports of ironing boards
manufactured by the appellant.

**Costs**

116    Under Article 122 of the Rules of Procedure of the Court of Justice, where the appeal is well founded and the Court itself
gives final judgment in the case, the Court is to make a decision as to costs.

117    Under Article 69(2) of the Rules of Procedure of the Court of Justice, which applies to appeal proceedings pursuant to Article
118 of those rules, the unsuccessful party is to be ordered to pay the costs if they have been applied for in the successful
party’s pleadings. Since the Council has been unsuccessful, it must be ordered to pay the costs of both sets of proceedings,
in accordance with the form of order sought by the appellant.

118    Under the first subparagraph of Article 69(4) of the Rules of Procedure, which is also applicable to appeal proceedings under
Article 118 of those rules, the Member States and institutions which intervene in the proceedings are to bear their own costs.
In accordance with that provision, the Italian Republic and the Commission are ordered to bear their own costs. Pursuant to
the third subparagraph of Article 69(4), the Court may order an intervener other than a Member State or an institution to
bear its own costs. In accordance with that provision, the intervening companies are ordered to bear their own costs.

On those grounds, the Court (First Chamber) hereby:

1.      **Sets aside the judgment of the Court of First Instance of 29 January 2008 in Case T‐206/07 *Foshan Shunde Yongjian Housewares & Hardware* v *Council* in so far as the Court of First Instance found that Foshan Shunde Yongjian Housewares & Hardware Co. Ltd’s rights of defence
were not adversely affected by the infringement of Article 20(5) of Council Regulation (EC) No 384/96 of 22 December 1995
on protection against dumped imports from countries not members of the European Community;**

2.      **Annuls Council Regulation (EC) No 452/2007 of 23 April 2007 imposing a definitive anti-dumping duty and collecting definitively
the provisional duty imposed on imports of ironing boards originating in the People’s Republic of China and Ukraine, in so
far as it imposes an anti-dumping duty on imports of ironing boards manufactured by Foshan Shunde Yongjian Housewares and
Hardware Co. Ltd.;**

3.      **Orders the Council of the European Union to pay the cost of the proceedings at first instance and the appeal proceedings;**

4.      **Orders the Commission of the European Communities, Vale Mill (Rochdale) Ltd, Pirola SpA, Colombo New Scal SpA and the Italian
Republic to bear their own costs.**

[Signatures]

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[\*](#Footref*) Language of the case: French.