# Council Implementing Regulation (EU) No 508/2013Show full title

Council Implementing Regulation (EU) No 508/2013 of 29 May 2013 imposing a definitive anti-dumping duty on imports of certain            tungsten electrodes originating in the People’s Republic of China following an expiry review pursuant to Article 11(2) of            Regulation (EC) No 1225/2009         

        - Previous
        - Next

U.K.

# Council Implementing Regulation (EU) No 508/2013                     

# of 29 May 2013

# imposing a definitive anti-dumping duty on imports of certain tungsten electrodes originating in the People’s Republic of                        China following an expiry review pursuant to Article 11(2) of Regulation (EC) No 1225/2009                     

THE COUNCIL OF THE EUROPEAN UNION,

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

Having regard to Council Regulation (EC) No 1225/2009 of 30 November 2009 on protection against dumped imports from countries                           not members of the European Community(1) (‘the basic Regulation’), and in particular Article 9(4) and 11(2), (5) and (6) thereof,                        

Having regard to the proposal from the European Commission after consulting the Advisory Committee,

Whereas:

A.**PROCEDURE**1.**Measures in force**(1)Following an investigation (the ‘original investigation’) the Council, by Regulation (EC) No 260/2007(2), imposed a definitive anti-dumping duty on imports of certain tungsten electrodes originating in the People’s Republic of                                 China (‘the PRC’) (the ‘original measures’). The measures took the form of an *ad valorem* duty of 63,5 % for all companies except three Chinese exporting producers to whom individual duties were granted.2.**Initiation of an expiry review**(2)On 9 March 2012, the Commission announced by a notice (‘Notice of initiation’)(3), published in the *Official Journal of the European Union*, the initiation of an expiry review of the anti-dumping measures applicable to imports of certain tungsten electrodes originating                                 in the PRC.(3)The review was initiated following a substantiated request lodged by Eurométaux (‘the applicant’) on behalf of a Union producer                                 representing more than 50 % of the Union production of certain tungsten electrodes.(4)The request was based on the grounds that the expiry of the measures would be likely to result in a continuation of dumping                                 and injury to the Union industry.3.**Investigation**3.1.*Review investigation period and the period considered*(5)The investigation of continuation or recurrence of dumping covered the period from 1 January 2011 to 31 December 2011 (‘the                                 review investigation period’ or ‘RIP’). The examination of the trends relevant for the assessment of the likelihood of continuation                                 or recurrence of injury covered the period from 1 January 2008 to the end of the RIP (‘the period considered’).3.2.*Parties concerned by the investigation*(6)The Commission officially advised the applicant, the other known Union producer, exporting producers in the PRC, unrelated                                 importers and users known to be concerned, producers in the potential analogue countries and the representatives of the PRC                                 of the initiation of the expiry review. Interested parties were given the opportunity to make their views known in writing                                 and to request a hearing within the time limit set out in the Notice of initiation.(7)All interested parties, who so requested and showed that there were particular reasons why they should be heard, were granted                                 a hearing.(8)In view of the apparently large number of exporting producers in the PRC and unrelated importers in the Union involved in                                 the investigation, sampling was envisaged in the Notice of initiation, in accordance with Article 17 of the basic Regulation.                                 In order to enable the Commission to decide whether sampling would be necessary and, if so, to select a sample, the above                                 parties were requested, pursuant to Article 17 of the basic Regulation, to make themselves known within 15 days of the publication                                 of the Notice of initiation and to provide the Commission with the information requested in the Notice of initiation.(9)Three importers made themselves known. None of them, however, imported certain tungsten electrodes originating in the PRC                                 during the RIP.(10)As only two exporting producers from the PRC came forward with the requested information it was not necessary to select a                                 sample of exporting producers.(11)The Commission sent questionnaires to all parties known to be concerned and to those who made themselves known within the                                 deadlines set in the Notice of initiation. Replies were received from two Union producers, two exporting producers in the                                 PRC and one producer in the USA.(12)The Commission sought and verified all the information it deemed necessary for the determination of the likelihood of continuation                                 or recurrence of dumping and resulting injury and of the Union interest. Verification visits were carried out at the premises                                 of the following companies:(a)
*Union producers*                                     
-  Plansee SE, Austria 
-  Gesellschaft für Wolfram Industrie mbH, Germany 
(b)
*Exporting producers in the PRC*                                     
-  Shandong Weldstone Tungsten Industry Co., Ltd, Zibo 
-  Shaanxi Yuheng Tungsten & Molybdenum Industrial Co., Ltd, Baoji 
(c)
*Related company to one cooperating exporting producer in the PRC*                                     
-  Shanghai Weldstone Asia Co., Ltd, Shanghai 
(d)
*Related companies to one cooperating exporting producer in the European Union*                                     
-  Weldstone GmbH, Wilnsdorf, Germany 
-  Binzel Benelux bvba, Eke – Nazareth, Belgium 
(e)
*Analogue Country*                                     
-  Global Tungsten & Powders Corp, Towanda, USA. 

B.**PRODUCT UNDER REVIEW AND LIKE PRODUCT**(13)The product concerned is the same as that covered by Regulation (EC) No 260/2007, namely tungsten welding electrodes, including                                 tungsten bars and rods for welding electrodes, containing 94 % or more by weight of tungsten, other than those obtained simply                                 by sintering, whether or not cut to length, originating in the PRC (‘TE’ or ‘the product under review’), currently falling                                 within CN codes ex 8101 99 10 and ex 8515 90 00.(14)The product under review is used in welding and similar processes. TE are used in a wide variety of industrial sectors such                                 as construction, shipbuilding, automobile manufacturing, marine, chemical and nuclear engineering, aerospace as well as oil                                 and gas pipelines. Based on the physical and chemical characteristics and the substitutability of the different types of the                                 product from the perspective of the user, all TE are considered to constitute a single product for the purpose of this proceeding.(15)The investigation confirmed that, as in the original investigation, the product under review and that manufactured and sold                                 on the domestic market of the PRC, as well as that produced and sold by the Union industry on the Union market and that produced                                 and sold on the analogue country market have the same basic physical and technical characteristics and the same basic uses                                 and are therefore considered to be alike within the meaning of Article 1(4) of the basic Regulation.

C.**LIKELIHOOD OF A CONTINUATION OR A RECURRENCE OF DUMPING**1.**Preliminary remarks**(16)In accordance with Article 11(2) of the basic Regulation, it was examined whether dumping was currently taking place and whether                                 the expiry of the existing measures would be likely to lead to a continuation or recurrence of dumping.(17)As explained above, it was not necessary to select a sample of exporting producers in the PRC. The two cooperating companies                                 covered the imports of product concerned from the PRC to the Union in a range of 80 % to 85 % during the RIP. On this basis,                                 it was concluded that cooperation was high.(18)One of the cooperating exporting producers benefited from market economy treatment (‘MET’) in accordance with Article 2(7)(c)                                 of the basic Regulation, while the second benefited from individual treatment (‘IT’) in accordance with Article 9(5) of the                                 basic Regulation, granted to them during the original investigation. It is recalled that in the context of investigations                                 in accordance with Article 11(2) of the basic Regulation, MET and IT are not reconsidered. A third company, who did not cooperate                                 in the current expiry review, was granted IT in the original investigation.2.**Dumping of imports during the RIP**2.1.*Analogue country*(19)Since the PRC is an economy in transition and in accordance with the provisions of Article 2(7)(a) of the basic Regulation,                                 normal value for exporting producers not granted market economy treatment has to be determined on the basis of the price or                                 constructed value in an appropriate market economy third country (‘analogue country’).(20)As in the original investigation, the USA was proposed as analogue country in the Notice of initiation for the purpose of                                 establishing normal value. Interested parties were given the opportunity to comment on the appropriateness of this choice.                                 No comments were received in this regard.(21)The Commission also examined whether other countries could be a reasonable choice of an analogue country and identified other                                 third countries from which imports of tungsten electrodes were recorded in Eurostat. Potential known producers in these countries                                 were contacted and invited to cooperate in the investigation. However, no cooperation was obtained.(22)It was considered that the USA was representative as a reference market, especially in view of the openness and competitiveness                                 of their domestic market. The USA was used also as an analogue country in the original investigation. No new or changed circumstances                                 which would justify a change appeared to exist nor were any such circumstances communicated to the Commission.(23)Therefore, the USA has been used as an analogue market economy country for the purpose of this review. The only known USA                                 producer was contacted and agreed to cooperate, to reply to the questionnaire and to accept a verification visit. The verified                                 sales and production figures of this company have been used for the determination of the normal value for companies not granted                                 MET during the original investigation.2.2.*Normal value*(24)For the company granted MET in the original investigation, normal value has been established based on its data. In accordance                                 with Article 2(2) of the basic Regulation, it was examined whether the domestic sales of TE to independent customers were                                 representative during the RIP, i.e. if the sales volume of the product intended for domestic consumption represented 5 % or                                 more of their exports of the product under review to the Union.(25)It was subsequently examined whether the domestic sales of the like product could be regarded as being made in the ordinary                                 course of trade pursuant to Article 2(4) of the basic Regulation, by establishing the proportion of profitable sales to independent                                 customers on the domestic market.(26)For the types of the product concerned where the domestic sales were representative and made in the ordinary course of trade,                                 normal value was established on the prices paid by independent customers in the exporting country. For the remaining types                                 of the product under review the normal value had to be constructed in accordance with Article 2(3) of the basic Regulation.                                 Therefore, the established normal value was calculated using the company’s cost of manufacturing and adding selling, general                                 and administrative costs (SG&A) and profit achieved on the domestic sale made in the ordinary course of trade in accordance                                 with Article 2(6) of the basic Regulation.(27)Following disclosure, one party argued that the methodology used to determine SG&A expenses was different from the one used                                 in the original investigation which may have had an impact on the determination of the profit margin used to calculate the                                 constructed normal value in accordance with Article 2(6) of the basic Regulation. Further to the information already previously                                 submitted in the investigation the party did not substantiate its claim by any evidence. It is noted that in accordance with                                 Article 2(5) of the basic Regulation SG&A expenses were allocated on turnover basis and that this methodology was also used                                 in the original investigation.(28)Profit used in the initial investigation was not from the OCOT test (ordinary course of trade) as none of the exported types                                 of the product concerned were sold on the domestic market in the ordinary course of trade. The current expiry review showed                                 that some types of the product concerned were profitable and therefore, in compliance with Article 2(3) and (6) of the basic                                 Regulation, profit of these profitable transactions was used for constructing the normal value.(29)As far as the company not granted MET in the original investigation is concerned, pursuant to Article 2(7)(a) of the basic                                 Regulation, normal value was established on the basis of information collected from the cooperating producer in the analogue                                 country. Domestic sales of the producer in the analogue country were found to be made in sufficient quantities and in the                                 ordinary course of trade and could thus be used as a basis to determine normal value for the company not granted MET.2.3.*Export price*(30)Regarding the company granted MET, all export sales to the Union were made via related importers and subsequently resold to                                 related and unrelated companies in the Union. The export price was therefore constructed, pursuant to Article 2(9) of the                                 basic Regulation, on the basis of the price at which the imported products were first resold to an independent buyer, duly                                 adjusted for all costs incurred between importation and resale, as well as a reasonable margin for SG&A and profits. In this                                 regard, the related companies’ own SG&A costs were used.(31)Following disclosure one party argued that when determining SG&A of the related importers, certain expenses were taken into                                 consideration that were related to the sales of other products than the product concerned and that these expenses should therefore                                 be excluded. It is noted that the verified SG&A expenses as provided by the companies concerned were taken into consideration                                 when constructing the export price in accordance with Article 2(9) of the basic Regulation. The claim that the SG&A expenses                                 reported included SG&A expenses from sales of other products was not supported by any evidence and had therefore to be rejected.(32)In addition, the comments submitted by an interested party on export prices were based on an erroneous quotation of the relevant                                 currency. Therefore this claim was rejected.(33)As far as the profit margin is concerned, none of the unrelated importers in the Union cooperated. In the original investigation,                                 the profit margin of the related importers was used, based on the fact that the activities of the unrelated importers were                                 not sufficiently comparable to that of the related importer concerned. The investigation showed that the activities of the                                 related importer were the same during the RIP as during the investigation period of the original investigation, i.e. the majority                                 of the TE imported was further integrated into the main product produced by the group, the welding torch. It should also be                                 noted that the TE are of minor value compared to the end-product. On this basis and as in the original investigation it was                                 concluded that the related importer’s own profit margin would constitute an accurate basis for a profit margin to construct                                 the export price.(34)Regarding the company granted IT in the original investigation, all export sales to the Union were made directly to independent                                 customers established in the Union. In accordance with Article 2(8) of the basic Regulation, the export price was therefore                                 established on the basis of the prices actually paid or payable.(35)The determination of the export price of all other producers established in the PRC was based on imports statistics available                                 in the Article 14(6) database.(36)In accordance with Article 11(10) of the basic Regulation, export prices were established by deducting the anti-dumping duties                                 paid, as none of the parties submitted any evidence that the duty was duly reflected in resale prices and subsequent selling                                 prices in the Union market.2.4.*Comparison*(37)The comparison between normal value and export price was made on an ex-works basis.(38)For the purpose of ensuring a fair comparison between the normal value and the export price of the both cooperating exporting                                 producers, and in accordance with Article 2(10) of the basic Regulation, due allowance in the form of adjustments was made                                 with regard to differences in transport, insurance and credit costs which affected prices and price comparability.2.5.*Dumping margin*(39)As provided for under Article 2(11) of the basic Regulation, the dumping margin was established on the basis of a comparison                                 of the weighted average normal value with the weighted average export price.(40)For the cooperating exporting producer granted MET in the original investigation this comparison showed that this company                                 continued dumping at significant levels.(41)For the cooperating exporting producer granted IT in the original investigation as well as country-wide dumping margin applicable                                 to all other non-cooperating exporting producers in the PRC showed a significant level of dumping even higher than in the                                 original investigation.3.**Development of imports should measures be repealed**3.1.*Preliminary remark*(42)Further to the finding of the existence of dumping during the RIP, the likelihood of continuation of dumping should measures                                 be repealed was investigated.(43)In this regard, it should be noted that the cooperating exporting producers represented only around 10 % of the total production                                 capacity in the PRC. Therefore, findings had to be largely based on information submitted in the review request as well as                                 publicly available information. The export price behaviour of Chinese producers to other third country markets, the Chinese                                 production capacity as well as available spare capacities and the attractiveness of the Union market for Chinese exporters                                 were considered in particular.3.2.*Export price behaviour of Chinese producers to other third country markets*(44)As far as exports to other third country markets are concerned, it should be noted that the statistical information available                                 from Chinese public databases covers a broader product scope than the product under review and therefore no meaningful analysis                                 of quantities exported to other markets or prices on these markets could be made. The two cooperating producers from the PRC                                 did not export to unrelated customers in other third markets. On this basis, the export prices to other third country markets                                 during the RIP could not be reliably established and no firm conclusions could be drawn on the basis of the information available.3.3.*Spare capacity of the Chinese producers*(45)The data on the basis of which the analysis below is made were provided by the applicant in the review request and was cross-checked                                 with publicly available information.(46)On this basis, capacities of producers in the PRC were estimated at 1 600 000 kg. The applicant’s estimation of the capacity                                 utilisation of Chinese producers is around 63 % resulting in an unused capacity of about 600 000 kg, exceeding nearly five                                 times the total Union consumption during the RIP. Thus, there are large quantities available for export from the PRC, in particular,                                 because there are no indications that third country markets or the domestic market could absorb this significant spare capacity.3.4.*Volume and prices of dumped imports from the PRC*(47)Imports from the PRC into the Union increased by 9 % over the period considered and reached the level of well above 50 000                                 kilograms during the RIP representing approximately half of the total Union consumption during the RIP.(48)Throughout the period considered, import prices were fluctuating and followed the same trends as the sales prices of the Union                                 industry on the Union market. Overall, import prices increased from 2008 to the RIP by 42 % and were still at dumped levels.                                 The price growth is mainly explained by the higher cost of the main raw material (tungsten powder) during the RIP.3.5.*Attractiveness of the Union market*(49)The Union market is among the largest in the world reaching around 20 % of the world consumption of TE. Chinese companies                                 have shown a serious interest in developing their presence on the Union market which is supported by the fact that they maintained                                 and even increased their significant market share of 45 % during the RIP.3.6.*Conclusion of the likelihood of continuation of dumping*(50)The foregoing analysis demonstrates that Chinese imports continued to enter the Union market at dumped prices with significant                                 dumping margins. Given most notably the analysis of price levels on the Union market, and the interest Chinese exporters have                                 shown in the Union market, as well as the significant spare capacities available in the PRC, going far beyond the total Union                                 consumption, it can be concluded there is a strong likelihood of continuation of dumping should measures be removed.

D.**SITUATION ON THE UNION MARKET**1.**Definition of the Union industry**(51)The current investigation confirmed that TE is manufactured by two producers in the Union. Both producers cooperated fully                                 with the investigation.(52)The above companies constitute the Union industry within the meaning of Article 4(1) and 5(4) of the basic Regulation and                                 will hereafter be referred to as the ‘Union industry’.2.**Preliminary remark**(53)Since there are only two companies which constitute the Union industry, the data referring to the Union industry will be either                                 presented in indexed form or ranges, so as to protect confidentiality pursuant to Article 19 of the basic Regulation.(54)Since imports under CN code level from Eurostat also included products other than TE, information on imports have been analysed                                 at TARIC code level, supplemented by data collected in accordance with Article 14(6) of the basic Regulation. TARIC data are                                 considered confidential as they provide a level of detail which allows for identification of parties. For this reason some                                 information is presented in ranges.3.**Union consumption**(55)Union consumption was established on the basis of the sales volume of the Union industry on the Union market, and import data                                 from Eurostat, at TARIC code level supplemented by information from data collected in accordance with Article 14(6) of the                                 basic Regulation.(56)Between 2008 and the RIP (‘period considered’), Union consumption decreased by 16 %. Consumption in the Union has decreased                                 substantially between 2008 and 2009, and has increased since, without reaching the pre-crisis levels during the RIP. From                                 the low peak in 2009 to the RIP, Union consumption increased by almost 40 %.*Table 1***Consumption***Source:* Questionnaire replies, Eurostat, Article 14(6) database.                                          Volume(kg)200820092010RIPConsumption140 000-150 00090 000-100 000110 000-120 000120 000-130 000Index (2008 = 100)1006175844.**Volume and market share of dumped imports from the PRC**(57)The volumes and market shares of dumped imports from the PRC was established on the basis of statistical information provided                                 at TARIC level supplemented by information from data collected in accordance with Article 14(6) of the basic Regulation.(58)Notwithstanding the absolute decrease of the Union consumption, the volume of imports of the product under review originating                                 in the PRC increased by 9 % over the period considered, keeping a level well above 50 000 kg during the RIP (see Table 2).                                 This increase, together with the general reduction of the Union consumption during the period considered, led to an increase                                 of the market share of the Chinese exporters to approximately half of the total Union market.*Table 2***Imports from the PRC***Source:* Eurostat, Article 14(6) database.                                          200820092010RIPVolume51 77136 18839 95356 289Index (2008 = 100)1007077109Market share (%)35-4035-4035-4045-505.**Prices of the imports from the PRC**5.1.*Evolution of prices*(59)Prices from the PRC increased in the region of 40 % between the year 2008 and the RIP, with a sharp increase during the RIP.                                 The price growth is mainly explained by the higher cost of the main raw material (tungsten powder) during the RIP.*Table 3***Prices of the imports from the PRC***Source:* Eurostat, Article 14(6) database.                                          200820092010RIPPricesEUR/kg36,5933,8341,5651,83Index (2008 = 100)100921141425.2.*Price undercutting*(60)The investigation revealed that import prices from the PRC were undercutting the Union industry average prices. An undercutting                                 margin of 37 % was established during the RIP, and when including the anti-dumping duty in the calculation, the undercutting                                 margin was still significant at a level of 24 %. The calculation was based on a comparison of the CIF export prices of the                                 cooperating exporting producers with the average Union industry prices at ex-work level. The prices were considered representative                                 for the PRC as the two cooperating exporting producers covered around 80 % of the imports of TE from the PRC.(61)Following disclosure one exporting producer claimed that prices were not compared on a per-type basis and due to alleged significant                                 price variations between different product types the undercutting levels calculated were not meaningful. On the basis of the                                 information available, a price comparison on a per-type basis was only possible for part of the Union industry’s sales on                                 the Union market and only for part of the export sales made to the Union. However, the party did not present evidence that                                 would call into question the reasonableness of the methodology applied. This claim had therefore to be rejected.(62)Following disclosure it was also argued that the Chinese import prices and the Union industry’s sales prices on the Union                                 market were not compared at the same level of trade. This claim was not substantiated as the party concerned did not submit                                 any information or evidence that demonstrated consistent and distinct differences in function and prices of the seller for                                 the alleged different levels of trade. This claim was therefore rejected.6.**Imports from other third countries**(63)The volume of imports and prices from other countries during the period considered is shown in the table below. The volumes                                 and market shares of imports from other third countries were established on the basis of statistical information provided                                 at TARIC level supplemented by information from data collected in accordance with Article 14(6) of the basic Regulation.*Table 4***Imports from other third countries***Source:* Eurostat, Article 14(6) database.                                          200820092010RIPVietnamVolume of imports (kg)27 87814 18413 77625 833Index (2008 = 100)100514993PriceEUR/kg44,3645,3446,0256,01Index (2008 = 100)100102104126South KoreaVolume of imports (kg)21 2998 17411 0513 319Index (2008 = 100)100385216PriceEUR/kg50,9944,1644,1659,31Index (2008 = 100)1008787116Other third countriesVolume of imports (kg)7 6416 24710 9429 186Index (2008 = 100)10082143120PriceEUR/kg43,2459,8264,9857,75Index (2008 = 100)100138150134TotalVolume of imports (kg)56 81828 60535 77938 338Index (2008 = 100)100506367Market share of imports from other third countries (%)35-4030-3530-3530-35PriceEUR/kg46,748,1751,2556,71Index (2008 = 100)100103110121(64)Import volumes from other third countries to the Union market decreased during the period considered by around 33 %. Market                                 shares decreased over the period considered and were between 30 % to 35 % during the RIP. Prices from other third countries                                 increased by 21 % over the same period.(65)It is recalled that in the original investigation there were no significant imports of the like product to the Union market                                 other than from the PRC. The original investigation established that the core markets of the remaining US and Japanese producers                                 were their respective domestic markets. It was therefore concluded that imports from countries other than the PRC were extremely                                 small.(66)Information provided by the Union industry alleged that there is no existing production of TE in Vietnam and South Korea and                                 that imports from those countries were in fact coming from the PRC. However, no information was obtained confirming this allegation                                 during the current investigation.7.**Economic situation of the Union industry**7.1.*Preliminary remarks*(67)Pursuant to Article 3(5) of the basic Regulation, the Commission examined all relevant economic factors and indices having                                 a bearing on the state of the Union industry.(68)Since the Union industry is composed of only two producers, the data are reported in ranges for confidentiality reasons.7.2.*Production, production capacity and capacity utilisation*(69)The Union industry’s production decreased each year during the period considered. By the end of RIP, the production had decreased                                 by 29 % compared to 2008. The trend has been particularly negative during 2009, with a decrease of more than 40 %.*Table 5***Total Union production***Source:* Questionnaire replies.                                          Volume(kg)200820092010RIPProduction60 000-70 00035 000-40 00050 000-60 00040 000-50 000Index (2008 = 100)100608271(70)Production capacity remained stable during the period considered. As production decreased, the resulting capacity utilisation                                 showed an overall decrease of 27 % between 2008 and the RIP, reaching a 41 % capacity utilisation during the RIP. Detailed                                 data is shown below:*Table 6***Production capacity and capacity utilisation***Source:* Questionnaire replies.                                          Volume(kg)200820092010RIPProduction capacity95 000-110 00095 000-110 00095 000-110 00095 000-110 000Index (2008 = 100)100100100100Capacity utilisation (%)57354741Index (2008 = 100)1006082737.3.*Stocks*(71)The level of closing stocks of the Union industry decreased by 20 % between 2008 and the RIP. This trend is in line with the                                 trend of decreasing consumption on the Union market over the same period.*Table 7***Closing stock***Source:* Questionnaire replies.                                          Volume(kg)200820092010RIPClosing stock5 000-15 0005 000-15 0005 000-15 0005 000-15 000Index (2008 = 100)1007085807.4.*Sales volume*(72)The sales volume of the Union industry on the Union market to unrelated customers decreased by 23 % between 2008 and the RIP,                                 with a sharp decrease between 2008 and 2009. This negative trend has been sharper than the decrease in the total consumption,                                 with the exception of year 2010.*Table 8***Sales to unrelated customers***Source:* Questionnaire replies.                                          200820092010RIPVolume (kg)40 000-50 00025 000-30 00035 000-40 00030 000-35 000Index (2008 = 100)1006587777.5.*Market share*(73)As a result of what is observed in the previous recital regarding sales volume of the Union industry on the Union market,                                 the market share held by the Union industry fell during the period considered. The Union industry, whilst losing sales volumes,                                 was able to maintain its market shares through 2009 and 2010, but suffered a setback during the RIP, with declining sales                                 notwithstanding the growing market. This resulted in a market share of between 20 % to 25 %, slightly lower than the one which                                 was registered at the beginning of the period considered.*Table 9***Union market share***Source:* Questionnaire replies, Eurostat, Article 14(6) database.                                          200820092010RIPUnion market share25 %-30 %25 %-30 %30 %-35 %20 %-25 %Index (2008 = 100)100107117917.6.*Growth*(74)As explained above, consumption in the Union has decreased substantially between 2008 and 2009, as a result of the economic                                 downturn, and has increased since, without reaching the pre-crisis levels during the RIP. The Union industry, whilst losing                                 sales volumes, was able to maintain its market shares through 2009 and 2010, but suffered a setback during the RIP, with declining                                 sales notwithstanding the growing market.7.7.*Employment and productivity*(75)The level of employment of the Union industry declined between 2008 and the RIP by 13 %.(76)Following the fall in production, the productivity per employee, measures as output in kg per employee, has also decreased                                 during the period considered. Detailed data is shown below:*Table 10***Total Union employment and productivity***Source:* Questionnaire replies.                                          200820092010RIPIndex of employees100658487Index of productivity10092106837.8.*Unit sales prices*(77)Unit sales prices of the Union industry to unrelated customers in the Union decreased slightly between 2008 and 2010, partly                                 reflecting the impact of the economic crises. Between 2010 and the RIP unit sales prices increased substantially. Overall,                                 the prices of the Union industry increased by 35 % during the period considered. This price development, in particular between                                 2010 and the RIP, was caused by the increase of prices of the main components making up TE.*Table 11***Unit price of Union sales***Source:* Questionnaire replies.                                          200820092010RIPUnit price of Union sales (EUR per unit)80-12080-12080-120100-140Index (2008 = 100)10094961357.9.*Profitability*(78)Profitability improved between 2008 and the RIP, after having reached a lower level in 2009 and 2010. However profitability                                 remained negative throughout the whole period considered.*Table 12***Profitability***Source:* Questionnaire replies.                                          200820092010RIPProfitability Union salesIndex (2008 = 100)10095951047.10.*Investment and return on investment*(79)Investment in the business of the product concerned significantly decreased during the period considered.(80)Return on investment followed the profitability trend. In 2008 the Union industry registered a negative return on investment                                 which slightly improved, though it remained negative, during the RIP.*Table 13***Investments and return on investment***Source:* Questionnaire replies.                                          Index (2008 = 100)200820092010RIPInvestments10022318Return on investment100100961037.11.*Cash flow and ability to raise capital*(81)The cash flow, which is the ability of the industry to self-finance its activities, expressed as a percentage of the turnover                                 of the product concerned, significantly improved during the period considered, although it remained negative.*Table 14***Cash flow***Source:* Questionnaire replies.                                          200820092010RIPCash flowIndex (2008 = 100)10099961067.12.*Wages*(82)Between 2008 and the RIP the wages of the Union industry decreased by 16 % in line with the reduction of the number of employees.7.13.*Magnitude of dumping margin*(83)Despite the measures in force, substantial dumping continued during the RIP at a level which is significantly above the current                                 level of measures. Given the large spare capacity, the actual volumes of imports from the PRC and prices significantly undercutting                                 the Union industry’s sales price, the impact on the Union industry of the actual margins of dumping cannot be considered to                                 be negligible.7.14.*Recovery from past dumping*(84)It was analysed whether the Union industry recovered from the effects of past dumping. Despite the anti-dumping measures in                                 force, the Union industry did not manage to recover from past dumping. As a response to the price pressure of the Chinese                                 imports the Union industry tried to keep their market share but had losses as a result.8.**Conclusion on the situation of the Union industry**(85)The Union industry remained in a vulnerable economic situation and continued to suffer material injury. Almost all injury                                 indicators relating to the financial performance of the Union industry deteriorated during the period considered. Consequently,                                 it could not be concluded that the situation of the Union industry was secure.(86)As a response to the price pressure of the Chinese imports the Union industry tried to keep its market share, but selling                                 at prices largely below the break-even level. Indeed, the increase of the sales prices of the Union industry between 2010                                 and the RIP is linked to the increase of raw material prices and did not cover the total cost of the Union industry.(87)In conclusion, the difficulties of the Union industry can be clearly linked to the massive presence of Chinese low-priced                                 imports of the product under review on the Union market, which are sold at significantly dumped prices, despite the measures                                 in force. This factor was enough to determine a situation where the Union industry suffer losses in an attempt to keep a reasonable                                 market share. In addition, these difficulties have been further deepened throughout almost the entire period considered by                                 two factors: the downturn of the market during the economic crisis of 2008-09 and, even if to a minor extent, the sudden increase                                 of raw material costs during the RIP. This led to a scenario where losses have reached significant levels.(88)In view of the negative development of the indicators pertaining to the Union industry, it is considered that the Union industry                                 continued to suffer material injury within the meaning of the Article 3(5) of the basic Regulation during the period considered.

E.**LIKELIHOOD OF CONTINUATION OF INJURY**1.**Preliminary remarks**(89)During the period considered, the Union industry appeared in a vulnerable situation, still exposed to the injurious effect                                 of the dumped imports from the PRC.(90)In accordance with Article 11(2) of the basic Regulation, imports from the country concerned were assessed in order to establish                                 if there was a likelihood of continuation of injury, should measures be allowed to lapse.2.**Chinese import volumes**(91)It is recalled that consumption on the Union market decreased significantly since the original investigation mainly due to                                 the economic downturn. In these circumstances, the Chinese import volumes increased to a level well above 50 000 kg during                                 the RIP. As to the import volumes, this has increased by 9 % while the market share of the Union industry decreased.3.**Spare capacity in the PRC**(92)As described in recital 46, based on the information available there is significant spare capacity available in the PRC. It                                 can be expected that a large part of this spare capacity could be used to increase imports in the Union market in the absence                                 of anti-dumping measures. This is because there are no indications that third country markets or the Chinese domestic markets                                 could absorb the significant Chinese spare capacity. Therefore, the capacity to significantly increase imports to the Union                                 exists. The estimation of the unused capacity would exceed nearly five times the Union consumption during the RIP.(93)Moreover, information submitted during the investigation indicated important distortions in the raw material (ammonium paratungstate                                 – ‘APT’) market used to manufacture the product under review. This raw material is subject to export quotas imposed by the                                 Chinese authorities as well as export taxes. This limits the exports of APT and artificially increases its world price. These                                 distortions are likely to confer further incentives to the Chinese industry to produce and export at low prices, while the                                 Union industry has to produce the like product on the basis of artificially high raw material prices.4.**Attractiveness of the Union market**(94)It was demonstrated that the Chinese exporting producers showed a continuous interest in the Union market and were able to                                 increase import volumes at the expense of the sales of the Union industry. They even increased their already significant market                                 share during the RIP.5.**Conclusion**(95)The Union industry had been suffering from the effects of the Chinese dumped imports for several years and is currently still                                 in a fragile economic situation.(96)If measures were allowed to lapse there is a strong likelihood of increased dumped imports which could seriously threaten                                 the existence of the Union industry. Indeed, in the PRC there is a significant spare capacity which is likely to be largely                                 directed to the Union market, at dumped prices undercutting the Union industry sales prices in the Union market, should measures                                 be allowed to lapse.(97)In view of the findings of the investigation, namely the continuation of dumping, the spare capacity in the PRC, the distortion                                 found in the market for raw materials, the potential of the exporting producers in the PRC to redirect their export volumes                                 to the Union market, the price behaviour of the Chinese exporters clearly undercutting the prices of the Union industry and                                 the attractiveness of the Union market, any repeal of the measures would point to a likelihood of continuation of injury.

F.**UNION INTEREST**1.**Introduction**(98)In accordance with Article 21 of the basic Regulation, it has been examined whether the maintenance of the existing measures                                 would be against the Union interest as a whole. The determination of the Union interest was based on an appreciation of the                                 various interests involved, i.e. those of the Union industry, of importers and of users. All interested parties were given                                 the opportunity to make their views known pursuant to Article 21(2) of the basic Regulation.(99)It should be recalled that in the original investigation the imposition of measures was considered not to be against the interest                                 of the Union. Furthermore, the fact that the present investigation is a review, thus analysing a situation in which anti-dumping                                 measures have already been in place, allows the assessment of any undue negative impact on the parties concerned by the current                                 anti-dumping measures.(100)On this basis it was examined whether, despite the conclusion on the likelihood of a continuation of injurious dumping, compelling                                 reasons existed which would lead to the conclusion that it is not in the Union interest to maintain measures in this particular                                 case.2.**Interest of the Union industry**(101)In view of the situation of the Union industry and the analysis on the likelihood of recurrence of injury, it is clear that                                 the Union industry would be likely to experience a serious deterioration of its financial situation in case the anti-dumping                                 measures were allowed to lapse. Throughout the period considered the Union industry lost production and sales volume while                                 imports from the country concerned increased despite the measures in force. During the same period the financial situation                                 of the Union industry deteriorated as it experiences heavy losses. Therefore, effective competitive conditions need to be                                 enforced on the Union market.(102)It is considered that the continuation of measures would benefit the Union industry, which should then be able to increase                                 sales volumes and improve its financial situation. By contrast, the discontinuation of the measures would seriously threaten                                 the viability of the Union industry.3.**Interest of users**(103)None of the 15 contacted users came forward to cooperate. As in the original investigation no questionnaire replies were received                                 from interested users. In the original investigation the non-cooperation was explained by the low impact of TE on their production                                 costs as it appears that quality and reliability are primary criteria for customers. Given the apparent marginal impact of                                 the product under review on the costs of downstream products, it was concluded that measures would not adversely impact the                                 user industry.4.**Interest of importers**(104)Three importers contacted the Commission at the beginning of the investigation, but they were not considered as being interested                                 parties since they had not imported the product concerned from the PRC during the RIP. Given that importers of TE did not                                 show any interest during the investigation, it was concluded that it would not be clearly against EU interest to maintain                                 measures.5.**Conclusion**(105)Given the above, it is concluded that there are no compelling reasons against the maintenance of the current anti-dumping                                 measures.

G.**ANTI-DUMPING MEASURES**(106)All parties were informed of the essential facts and considerations on the basis of which it was intended to recommend that                                 the existing measures be maintained. They were also granted a period to submit comments subsequent to that disclosure. The                                 submissions and comments were duly taken into consideration where warranted.(107)It follows from the above that, as provided for by Article 11(2) of the basic Regulation, the anti-dumping measures applicable                                 to imports of certain tungsten electrodes originating in the PRC, imposed by Regulation (EC) No 260/2007 should be maintained.(108)In order to minimise the risk of circumvention due to the high difference in the duty rates, it is considered that special                                 measures are needed in this case to ensure the proper application of the anti-dumping duties. These special measures, which                                 only apply to companies for which an individual duty rate is introduced, include the following: the presentation to the customs                                 authorities of the Member States of a valid commercial invoice, which shall conform to the requirements set out in the Annex                                 to this Regulation. Imports not accompanied by such an invoice shall be made subject to the residual anti-dumping duty applicable                                 to all other producers,

HAS ADOPTED THIS REGULATION:

# Article 1U.K.

1.A definitive anti-dumping duty is hereby imposed on imports of tungsten welding electrodes, including tungsten bars and rods                        for welding electrodes, containing 94 % or more by weight of tungsten, other than those obtained simply by sintering, whether                        or not cut to length, currently falling within CN codes ex 8101 99 10 and ex 8515 90 00 (TARIC codes 8101 99 10 10 and 8515                        90 00 10) and originating in the People’s Republic of the China.                  

2.The rate of duty applicable to the, net free-at-Union-frontier price, before duty, of the products described in paragraph                        1, and manufactured by the companies listed below shall be as follows:                  

3.The application of the individual duty rates specified for the companies mentioned in paragraph 2 shall be conditional upon                        presentation to the customs authorities of the Member States of a valid commercial invoice, which shall conform to the requirements                        set out in the Annex. If no such invoice is presented, the duty rate applicable to ‘all other companies’ shall apply.                  

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

# Article 2U.K.

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

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

Done at Brussels, 29 May 2013.

*For the Council*                            

*The President*                            

R. Bruton                            

## ANNEXU.K.

The valid commercial invoice referred to in Article 1(3) of this Regulation must include a declaration signed by an official                     of the company, in the following format:                  

The name and function of the official of the company which has issued the commercial invoice.

The following declaration ‘I, the undersigned, certify that the [volume] of tungsten electrodes sold for export to the European                              Union covered by this invoice was manufactured by (company name and address) (TARIC additional code) in (country concerned).                              I declare that the information provided in this invoice is complete and correct.’                           

1

OJ L 343, 22.12.2009, p. 51.                           

2

OJ L 72, 13.3.2007, p. 1.                           

3

OJ C 71, 9.3.2012, p. 23.