# C_2021297EN.01005101.xml

| 26.7.2021 | EN | Official Journal of the European Union | C 297/51 |
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26.7.2021

EN

Official Journal of the European Union

C 297/51

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Action brought on 9 June 2021 — Guangdong Haomei New Materials and Guangdong King Metal Light Alloy Technology v Commission

(Case T-326/21)

(2021/C 297/63)

Language of the case: Italian

Parties

Applicants: Guangdong Haomei New Materials Co. Ltd (Qingyuan, China) and Guangdong King Metal Light Alloy Technology Co. Ltd (Yuan Tan Town, China) (represented by: M. Maresca, C. Malinconico, D. Guardamagna, M. Guardamagna, D. Maresca, A. Cerruti, A. Malinconico and G. Falla, lawyers)

Defendant: European Commission

Form of order sought

The applicants claim that the Court should annul in part Commission Implementing Regulation (EU) 2021/546 of 29 March 2021, notified to the applicants on 30 March 2021, imposing a definitive anti-dumping duty and definitively collecting the provisional duty imposed on imports of aluminium extrusions originating in the People’s Republic of China and, in the alternative, annul the basic regulation (Regulation 1036/2016); order the Commission to pay compensation for the damage caused by the application of those regulations and order the Commission to pay the costs.

Pleas in law and main arguments

In support of the action, the applicants rely on five pleas in law.

| 1. | First plea in law, relating to the obligation to ascertain specifically that the requirements for dumping have been met, infringement of the principles of due process and audi alteram partem, infringement of essential procedural requirements, misuse of powers due to the imprecise nature of the objections and the failure genuinely to verify the information provided in a spirit of cooperation.






  — | The applicants submit in this regard that the contested regulation is vitiated by unlawfulness in so far as the Commission failed to ascertain specifically the conditions obtaining on the markets considered and the applicants were not given the opportunity substantively to exercise their rights of defence. In short, Haomei and King Metal were found liable for dumping, and countervailing duties were accordingly imposed on them, not because of their own conduct in respect of exports from China, but rather due to a complex favourable assessment of the Chinese economy, and therefore for totally imprecise reasons. Satisfied with this, the Commission failed to carry out any specific assessment of the documents provided by the applicant undertakings. |
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1.

First plea in law, relating to the obligation to ascertain specifically that the requirements for dumping have been met, infringement of the principles of due process and audi alteram partem, infringement of essential procedural requirements, misuse of powers due to the imprecise nature of the objections and the failure genuinely to verify the information provided in a spirit of cooperation.

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The applicants submit in this regard that the contested regulation is vitiated by unlawfulness in so far as the Commission failed to ascertain specifically the conditions obtaining on the markets considered and the applicants were not given the opportunity substantively to exercise their rights of defence. In short, Haomei and King Metal were found liable for dumping, and countervailing duties were accordingly imposed on them, not because of their own conduct in respect of exports from China, but rather due to a complex favourable assessment of the Chinese economy, and therefore for totally imprecise reasons. Satisfied with this, the Commission failed to carry out any specific assessment of the documents provided by the applicant undertakings.

| 2. | Second plea in law, alleging infringement of the basic regulation relating to the determination of dumping margins, incorrect identification of the ‘normal’ price of the goods under investigation and application of provisional duties not on account of the liability of the exporters but in reaction to the overall structure of the Chinese economy.






  — | The applicants allege unlawfulness of the regulation on account of the fact that the Commission conducted an investigation that was incomplete and in any event led to an uncertain outcome; that outcome was also vitiated by the unlawfulness deriving from the regulation on the registration of goods, which is already the subject of an action before the Court, in so far as the Commission included goods codes (7610 90 90) in the investigation which, on its own admission, should not have been included as they relate to goods that are different to those subject to investigation. Such an error (having permitted the inclusion of different goods) eliminates both the dumping condition (in so far as the very low relative price inevitably and artificially reduces the average price) and the injury to the EU industry, as the quantities involved are significant in relation to the total volume of the goods, such as to render irrelevant the impact of the remaining part of the product imported into the European Union. |
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2.

Second plea in law, alleging infringement of the basic regulation relating to the determination of dumping margins, incorrect identification of the ‘normal’ price of the goods under investigation and application of provisional duties not on account of the liability of the exporters but in reaction to the overall structure of the Chinese economy.

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The applicants allege unlawfulness of the regulation on account of the fact that the Commission conducted an investigation that was incomplete and in any event led to an uncertain outcome; that outcome was also vitiated by the unlawfulness deriving from the regulation on the registration of goods, which is already the subject of an action before the Court, in so far as the Commission included goods codes (7610 90 90) in the investigation which, on its own admission, should not have been included as they relate to goods that are different to those subject to investigation. Such an error (having permitted the inclusion of different goods) eliminates both the dumping condition (in so far as the very low relative price inevitably and artificially reduces the average price) and the injury to the EU industry, as the quantities involved are significant in relation to the total volume of the goods, such as to render irrelevant the impact of the remaining part of the product imported into the European Union.

| — | In the second place, the applicants submit that the absence of a specific determination of their situation is incompatible with the Treaty (and with the rules cited) in so far as it establishes a regime of strict or vicarious liability, which runs counter to the fundamental principles of legal certainty and legitimate expectations by reason of market price and cost structure, manifestly of the market, produced by the applicants on several occasions to — and completely ignored by — the Commission (as the positions expressed on the market economy by the Chinese Government were similarly ignored). This has led to manifest unlawfulness, both as regards the substance (relating to the concepts of normal value, significant distortion, access to credit, tax regime, insolvency regime, representative countries and choice of those countries) and as regards procedure, set out at length in the present plea, resulting in a clear and detrimental discriminatory effect. |
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In the second place, the applicants submit that the absence of a specific determination of their situation is incompatible with the Treaty (and with the rules cited) in so far as it establishes a regime of strict or vicarious liability, which runs counter to the fundamental principles of legal certainty and legitimate expectations by reason of market price and cost structure, manifestly of the market, produced by the applicants on several occasions to — and completely ignored by — the Commission (as the positions expressed on the market economy by the Chinese Government were similarly ignored). This has led to manifest unlawfulness, both as regards the substance (relating to the concepts of normal value, significant distortion, access to credit, tax regime, insolvency regime, representative countries and choice of those countries) and as regards procedure, set out at length in the present plea, resulting in a clear and detrimental discriminatory effect.

| 3. | Third plea in law, alleging an absence of damage, distortion of the facts relating to market shares and infringement of the principle of proportionality.






  — | By the third plea in law, the applicants submit that the contested regulation is unlawful because the Commission has been unable to establish the existence of injury or a causal link between the latter and the dumping. |
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3.

Third plea in law, alleging an absence of damage, distortion of the facts relating to market shares and infringement of the principle of proportionality.

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By the third plea in law, the applicants submit that the contested regulation is unlawful because the Commission has been unable to establish the existence of injury or a causal link between the latter and the dumping.

| — | In addition, there is an absence of even a minimum of technical analysis and proper assessment of the proportionality of the dumping duty in relation to the damage to the industry established by the undercutting or underselling, required by the case-law as necessary for a finding of injury. On the contrary, in the applicants’ case, the absence of undercutting and underselling has been established (by way of the various documents produced in the body of the plea) from the Ex Works prices of Haomei and King Metal, which are comparable to European prices (DOC.3, Bauxite report). |
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In addition, there is an absence of even a minimum of technical analysis and proper assessment of the proportionality of the dumping duty in relation to the damage to the industry established by the undercutting or underselling, required by the case-law as necessary for a finding of injury. On the contrary, in the applicants’ case, the absence of undercutting and underselling has been established (by way of the various documents produced in the body of the plea) from the Ex Works prices of Haomei and King Metal, which are comparable to European prices (DOC.3, Bauxite report).

| — | In addition, the applicants submit that the European Union has no interest whatsoever in the duty being imposed, the sole interest being that of the complainants, which the Commission merely ‘adopted’ as its own reasoning, extending it, without analysis, to the entire European Union. In that connection, the applicants argue that the Commission, once again, completely failed to take into account the information produced by the applicants in the course of the procedure, which was also not examined during the adversarial proceedings (oral or written) or in the regulation. |
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In addition, the applicants submit that the European Union has no interest whatsoever in the duty being imposed, the sole interest being that of the complainants, which the Commission merely ‘adopted’ as its own reasoning, extending it, without analysis, to the entire European Union. In that connection, the applicants argue that the Commission, once again, completely failed to take into account the information produced by the applicants in the course of the procedure, which was also not examined during the adversarial proceedings (oral or written) or in the regulation.

| 4. | Fourth plea in law, alleging infringement of the General Agreement on Tariffs and Trade (‘GATT’) and, in the alternative, unlawfulness of the basic regulation if it is not interpreted in accordance with international agreements.






  — | The applicants submit in this regard that Regulation 2020/1428, adopted by the Commission on the legal basis of Article 207 TFEU, departs from the concepts provided for by the relevant international law. They add that, if this should not be the case, that is, in other words, if no unlawfulness vitiates Regulation 2020/1428 directly, then the basic regulation itself is unlawful. |
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4.

Fourth plea in law, alleging infringement of the General Agreement on Tariffs and Trade (‘GATT’) and, in the alternative, unlawfulness of the basic regulation if it is not interpreted in accordance with international agreements.

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The applicants submit in this regard that Regulation 2020/1428, adopted by the Commission on the legal basis of Article 207 TFEU, departs from the concepts provided for by the relevant international law. They add that, if this should not be the case, that is, in other words, if no unlawfulness vitiates Regulation 2020/1428 directly, then the basic regulation itself is unlawful.

| 5. | Fifth plea in law, alleging infringement of the European Convention of Human Rights in relation to the procedure imposing a sanction equivalent to a penalty under criminal law by reason of the effects produced on the exporting undertakings.
  For the applicant undertakings, the application of the duties in question constitutes an obstacle to the pursuit of their activities, causing irreparable harm comparable to that of a penalty under criminal law. |
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5.

Fifth plea in law, alleging infringement of the European Convention of Human Rights in relation to the procedure imposing a sanction equivalent to a penalty under criminal law by reason of the effects produced on the exporting undertakings.

For the applicant undertakings, the application of the duties in question constitutes an obstacle to the pursuit of their activities, causing irreparable harm comparable to that of a penalty under criminal law.

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