Judgment — ECLI:EU:T:2012:431
Date: 2012-09-18
Language of the case: French
Court formation: Eighth Chamber
Subject matter: Dumping;External relations;General Agreement on Tariffs and Trade (GATT);Commercial policy
Procedure: Action for annulment - unfounded

summary of the pleas in law on which it is based. That summary must be sufficiently clear and precise to enable the defendant to prepare its defence and the Court to rule on the action, if necessary without any other supporting information. The application must, accordingly, specify the nature of the grounds on which it is based, with the result that a mere abstract statement of the grounds does not satisfy the requirements of the Rules of Procedure (Case T‑102/92 Viho v Commission [1995] ECR II‑17, paragraph 68; Case T‑352/94 Mo och Domsjö v Commission [1998] ECR II‑1989, paragraph 333; and Case T‑224/10 Association belge des consommateurs test-achats v Commission [2011] ECR II‑7177, paragraph 71). Since the applicant has not in any way specified the nature of its plea alleging breach of its rights of defence, it must be rejected as inadmissible. 154 As regards the alleged breach of the second subparagraph of Article 2(7)(c) of the basic regulation, the applicant claims that it is apparent from Nanjing Metalink v Council and Shanghai Excell M&E Enterprise and Shanghai Adeptech Precision v Council, paragraph 152 above, that a breach of the time-limit laid down in that provision occurs every time the Commission takes a decision refusing MET when it is already in possession of information enabling it to calculate the dumping margin of the producer concerned, both where MET is granted and where it is not. 155 Questioned on the scope of its argument at the hearing, the applicant stated that the second subparagraph of Article 2(7)(c) of the basic regulation, as interpreted by the General Court in the judgments cited at paragraph 152 above and the judgment of 8 November 2011 in Case T‑274/07 Zhejiang Harmonic Hardware Products v Council, not published in the ECR, paragraph 37, offers protection against arbitrary conduct on the part of the Commission, which is not entitled to take a decision on a company’s MET claim in accordance with what it knows of the effect of such a decision on that company’s dumping margin. 156 Those conditions were, in practice, satisfied when the Commission requested and received from the producer concerned the answers to the sections of the anti‑dumping questionnaire concerning its domestic sales and costs and also received that information from the company or companies in the analogue country, or when the Commission became aware by any other means that the normal value on the analogue market was higher than in China. 157 In the present case the Commission could have calculated the applicant’s dumping margin on 18 December 2009, when it received the answers to the anti‑dumping questionnaire from the Union producers and, accordingly, the contested regulation should be annulled, since the decision as to whether the applicant was entitled to MET might have been different if the Commission had not had that information available to it. 158 It should be recalled that Article 2(7)(b) of the basic regulation provides that, in anti-dumping investigations concerning imports from China, normal value is to be determined in accordance with paragraphs 1 to 6, if it is shown, on the basis of properly substantiated claims by one or more producers subject to the investigation and in accordance with the criteria and procedures set out in subparagraph (c), that market economy conditions prevail for that producer or producers in respect of the manufacture and sale of the like product concerned. 159 The second subparagraph of Article 2(7)(c) of the basic regulation states that ‘[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[; t]his determination shall remain in force throughout the investigation’. 160 In the light of the case‑law relied on by the applicant cited at paragraphs 152 and 155 above, first, there is no ground for holding that any failure to comply with the three-month time‑limit laid down in the second subparagraph of Article 2(7)(c) of the basic regulation must automatically entail the annulment of the Council’s regulation imposing definitive anti‑dumping duty that is to be adopted within that period. Indeed, as stated by the Court in Shanghai Excell M&E Enterprise and Shanghai Adeptech Precision v Council, paragraph 152 above (paragraphs 138 and 139), failure to comply with the time‑limit laid down in Article 2(7)(c) of the basic regulation can entail such annulment only if the applicant shows that, in the absence of such failure, the Council might have adopted a different regulation more favourable to its interests than the contested regulation. 161 Second, the applicant cannot rely on the legal rationale of Article 2(7)(c) of the basic regulation, as identified by the Court in the judgments cited at paragraphs 152 and 155 above, in support of its submission that breach of the time‑limit laid down by that provision occurs every time the Commission takes a decision refusing MET when it is already in possession of information enabling it to calculate the dumping margin of the producer concerned and, as a consequence, disregards the very wording of that provision, which states that the Commission has three months within which to give a decision on MET claims submitted to it. 162 It should be noted in that regard, first, that it is in the response to the specific argument of the applicant in the case in question that the last sentence of Article 2(7)(c) of the basic regulation provides, without exception, that the decision reached concerning MET is to remain valid throughout the investigation, that the Court stated, in Nanjing Metalink v Council, paragraph 152 above (paragraph 44), that Article 2(7)(c) of the basic regulation prohibits the institutions from re-evaluating the information which was already available to them when the initial MET decision was made and that that provision is intended, in particular, to ensure that the question whether the producer concerned operates under market economy conditions is not decided on the basis of its effect on the calculation of the dumping margin. The applicant’s argument, was, nevertheless rejected, since the overriding factor in the Court’s reasoning was that a decision conferring MET which no longer reflects the situation of the producer concerned cannot be maintained (Nanjing Metalink v Council, paragraph 152 above, paragraphs 45 to 47). 163 Next, in Shanghai Excell M&E Enterprise and Shanghai Adeptech Precision v Council, paragraph 152 above (paragraph 128), the Court referred to the legal rationale of the provision referred to above solely for the purpose of establishing that the practical effect of that time-limit is not called in question if, in the period between the expiry of the three-month time‑limit and the MET decision and having regard to the circumstances of the case, it had to be concluded that the undertakings seeking MET status had made it impossible for the Commission to know what effect its MET decision might have on the calculation of the dumping margin. 164 Lastly, in Zhejiang Harmonic Hardware Products v Council, paragraph 155 above (paragraph 37), the Court referred to the legal rationale of the second subparagraph of Article 2(7)(c) of the basic regulation while at the same time pointing out that that provision does not preclude MET status being relinquished where it is no longer possible, as a result of a change in the factual situation on the basis of which that status was conferred, to regard the producer concerned as operating under market economy conditions, or where the Commission is led to propose to the Council definitive measures perpetuating, to the detriment of the undertaking concerned, an error made in the initial assessment of the substantive criteria set out in the first subparagraph of Article 2(7)(c) of that regulation. 165 It follows that, contrary to the applicant’s submission, in Nanjing Metalink v Council, Shanghai Excell M&E Enterprise and Shanghai Adeptech Precision v Council, paragraph 152 above, and Zhejiang Harmonic Hardware Products v Council, paragraph 155 above, the Court did not find that the legal rationale of the second subparagraph of Article 2(7)(c) of the basic regulation justified the annulment of a regulation imposing definitive anti‑dumping duties on an undertaking every time the Commission was in a position to know the effect of a MET decision on the calculation of that undertaking’s dumping margin simply because it was in possession of such knowledge at the time the MET decision was taken. It should be noted, as observed by the Council, that there is no immediate link between the three‑month time‑limit laid down in the second subparagraph of Article 2(7)(c) of the basic regulation and any knowledge on the part of the Commission of the effect of a MET decision on an undertaking’s dumping margin. Moreover, the basic regulation does not require that the MET decision should be adopted at a time when the Commission does not possess information enabling it to ascertain the effect of a MET decision on an undertaking’s dumping margin. Even where the time‑limit has not in any way been exceeded at the time the MET decision is adopted, the Commission might take such a decision, notwithstanding the fact that it is already in possession of information enabling it to calculate its effect on the dumping margin of the undertaking concerned. 166 In any event, it is clear from Case 141/08 P Foshan Shunde Yongjian Housewares & Hardware v Council [2009] ECR I‑9147 that, on the basis of the principles of compliance with the law and sound administration and provided that the procedural safeguards provided for in the basic regulation are observed, the Court of Justice favours the correct application of the substantive criteria laid down in Article 2(7)(c) of the basic regulation over any requirement for an unalterable MET decision or for absence of knowledge of the effect of a MET decision on an undertaking’s dumping margin at the time when such a decision is adopted. As the Court observed in Zhejiang Harmonic Hardware Products v Council, paragraph 155 above (paragraph 39), the Court of Justice considered in the judgment cited above that, in the light of the principles of compliance with the law and sound administration, Article 2(7)(c) of the basic 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 assessment of the substantive criteria established by that provision, to the detriment of the undertaking concerned. 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 (Foshan Shunde Yongjian Housewares & Hardware v Council, paragraphs 111 and 112). 167 In the light of the foregoing, it must be concluded that, while, as a rule, any MET decision should, in accordance with the wording of the second subparagraph of Article 2(7)(c) of the basic regulation, be taken within three months of the initiation of the investigation and that determination should remain in force throughout the investigation, the fact nevertheless remains that, under EU law as it currently stands and according to the EU judicature’s interpretation of that provision referred to at paragraphs 152 and 155 above, first, the adoption of a decision outside that period does not, by virtue of that fact alone, lead to the annulment of the regulation imposing anti‑dumping duty and, second, such a decision may be amended in the course of the proceeding if it proves to be incorrect. 168 In the present case, it is common ground that the final decision rejecting the applicant’s MET request was not adopted within the three‑month period laid down in the second subparagraph of Article 2(7)(c) of the basic regulation. The notice of initiation of the investigation procedure was published in the Official Journal of the European Union on 2 October 2009. However, the final decision refusing MET was proposed on 26 March 2010 and confirmed on 30 April 2010. 169 Moreover, the Commission received the applicant’s answers to the anti‑dumping questionnaire on 19 November 2009, including the sections of the questionnaire on domestic sales and the related costs (see paragraph 29 above). According to the applicant, that information enabled the Commission to calculate what its dumping margin would be if MET was granted. Furthermore, on 18 December 2009 the Commission received the answers to the anti‑dumping questionnaires of the Union producers referred to at paragraph 23 above and was in a position as of that date, as pointed out by the applicant, to calculate the effect of a decision rejecting the applicant’s MET claim on its dumping margin. 170 However, in the light of the foregoing considerations, even though it may be relevant that, as a result of its disregarding the three-month time‑limit laid down in the second subparagraph of Article 2(7)(c) of the basic regulation, the Commission might have known the effect of the decision concerning the applicant’s MET status on its dumping margin, since it may be argued that the Commission could have been influenced by that knowledge in adopting such a decision, it must be held that the applicant has failed to show that the contested regulation might have been substantively different but for the purported irregularity affecting the procedure for the adoption of the MET decision. 171 First, the applicant’s argument that the Commission’s decision rejecting its MET claim was taken ‘in accordance with what it knew of the impact of that decision on [its] dumping margin and that decision might have been different if the Commission had not had such information available to it’ cannot be accepted. Mere knowledge of the effect of a MET decision on an undertaking’s dumping margin does not necessarily mean that such a decision — and, consequently, the contested regulation — might have been substantively different if the decision had been adopted within the three‑month time‑limit laid down in Article 2(7)(c) of the basic regulation. First, according to the applicant itself, the Commission was already in a position on 18 December 2009, that is, before the expiry of the time‑limit, to know the effect of a decision rejecting the MET claim on its dumping margin. Second, even if the Commission had information enabling it to calculate a producer’s dumping margin at the time when the decision on that producer’s MET status was taken, it is still possible that that decision — and the regulation imposing definitive anti‑dumping duties — might not have been any different. That might be the case where it is clear that such a producer could not be granted MET because the Commission correctly concluded that the producer concerned did not meet the criteria for granting MET laid down in Article 2(7)(c) of the basic regulation and the requirements necessary for imposing anti‑dumping duties were satisfied. 172 Moreover, the applicant’s argument is not in any way substantiated. First, the applicant simply claims, without providing the least evidence in support of that claim, that ‘the Commission’s objective was to put an end to the zero rate of duty which [it] enjoyed … by whatever means available for attaining that objective’. In that context, even if, by argument, the applicant intended to allege misuse of powers on the part of the Commission, it must be rejected on the grounds set out at paragraph 130 above. 173 Second, the applicant does not indicate which aspects of the MET decision could have been assessed differently if the Commission’s decision had been taken within the three‑month time‑limit or in the absence of any purported knowledge of the effect of that decision on its dumping margin. 174 It is true that the applicant formulates, indirectly, certain observations on the price paid for its major inputs on the domestic market. Thus, the applicant states that the Commission found no evidence that the Chinese State influenced its decision concerning the purchase of raw materials. In that regard, the only influence alleged was of a macro‑economic order and related to the purported interference by the Chinese authorities to regulate the market price as a whole. Such interference is not liable to amount to significant State interference in the decisions of firms regarding prices, costs and inputs such as to prevent such decisions taking account of market signals reflecting supply and demand. 175 However, the purpose of those observations is to dispute the application of the criterion laid down in the first indent of Article 2(7)(c) of the basic regulation rather than to establish that the decision rejecting the MET claim was taken on the basis of the Commission’s knowledge of the effect of that decision on the applicant’s dumping margin, which nevertheless remains the objection on which the third plea is based. 176 In any event, even if, by disputing the Commission’s application of that criterion, the applicant was seeking to establish that, irrespective of any failure to comply with the three‑month time‑limit laid down in the second subparagraph of Article 2(7)(c) of the basic regulation, the MET decision was incorrect, it would be necessary to point out that, as is apparent from recitals 27 to 34 of the contested regulation, the investigation established that the applicant did not satisfy either the criterion set out in the first indent of Article 2(7)(c) of the basic regulation, relating to the cost of raw materials, or the criterion set out in the second indent of that provision, relating to the keeping of accounting records. 177 Since the producer concerned must fulfil all the criteria laid down in Article 2(7)(c) of the basic regulation in order to be granted market economy status and, should it fail to fulfil one of those criteria, its claim must be rejected (Shanghai Teraoka Electronic v Council, paragraph 109 above, paragraph 54), the applicant’s argument cannot invalidate the Commission’s assessment of its MET claim, since the applicant does not dispute that it did not satisfy the requirement laid down the second indent of Article 2(7)(c) of the basic regulation. 178 It follows that the applicant has failed to show that the contested regulation could have been substantially different if the Commission’s decision on its MET claim had been adopted within the three‑month period laid down in Article 2(7)(c) of the basic regulation or in the absence of any knowledge on the part of the Commission enabling it to calculate its dumping margin. 179 The first part of the third plea must therefore be rejected. The second part of the third plea, alleging that the burden of proof imposed by the Commission on the applicant for the purpose of showing that it operates in a market economy is excessive and infringes the general principles of EU law 180 In the second part of the third plea, the applicant submits that the burden of proof imposed on it by the Commission for the purpose of showing that it operates in a market economy is excessive and infringes the general principles of EU law, in particular the principle of sound administration. According to the case‑law of the General Court, the institutions cannot require a Chinese exporter to furnish proof of a fact which it is impossible for him to demonstrate in order to enjoy a right conferred on it by the basic regulation. 181 In the present case, the Commission required the applicant to show that the Chinese steel market was not subject to any significant interference by the Chinese authorities — evidence that it is impossible for the applicant to furnish. The Commission should state clearly the information that it wishes to receive from Chinese producers and ensure that the information sought is not excessive in the light of the subject‑matter of the request and the capacity of the exporters concerned. 182 As observed at paragraph 134 above, it is settled case‑law of the Court of Justice that, in the sphere of the common commercial policy and, most particularly, in the realm of measures to protect trade, the EU institutions enjoy a broad discretion by reason of the complexity of the economic, political and legal situations which they have to examine. The judicial review of such an appraisal must therefore be limited to verifying whether the procedural rules have been complied with, whether the facts on which the contested choice is based have been accurately stated, and whether there has been a manifest error in the appraisal of those facts or a misuse of powers (Ikea Wholesale, paragraph 96 above, paragraphs 40 and 41, and Joined Cases C‑191/09 P and C‑200/09 P Council and Commission v Interpipe Niko Tube and Interpipe NTRP [2012] ECR, paragraph 63). 183 The same applies to factual situations of a legal and political nature in the country concerned which the EU institutions must assess in order to determine whether an exporter operates under market conditions without significant State interference and may, accordingly, be granted market economy status (see, to that effect, Case T‑155/94 Climax Paper v Council [1996] ECR II‑873, paragraph 98; Shanghai Teraoka Electronics v Council, paragraph 109 above, paragraph 49; and Shanghai Excell M&E Enterprise and Shanghai Adeptech Precision v Council, paragraph 152 above, paragraph 81). 184 However, whilst, in the sphere of measures to protect trade, in particular anti‑dumping measures, the EU judicature cannot interfere in the assessment reserved to the EU authorities, its task is nevertheless to satisfy itself that the institutions have taken account of all the relevant circumstances and appraised the facts of the matter with all due care (see, to that effect, Case T‑413/03 Shandong Reipu Biochemicals v Council [2006] ECR II‑2243, paragraph 64 and the case‑law cited). 185 Moreover, it is apparent from Article 2(7)(c) of the basic regulation that the burden of proof lies with the producer wishing to claim market economy status. Article 2(7)(c) provides that a claim submitted under subparagraph (b) must be made in writing and contain sufficient evidence that the producer operates under market economy conditions. Accordingly, it is not incumbent on the EU institutions to prove that the producer does not satisfy the conditions laid down for recognition of such status. On the contrary, the task of those institutions is to assess whether the evidence supplied by the producer is sufficient to show that the requirements laid down in Article 2(7)(c) of the basic regulation are fulfilled and that of the EU judicature to examine whether that assessment is vitiated by a manifest error (Case C‑249/10 P Brosmann Footwear (HK) and Others v Council [2012] ECR, paragraph 32; see also, to that effect, Shanghai Teraoka Electronic v Council, paragraph 109 above, paragraph 53, and Shanghai Excell M&E Enterprise and Shanghai Adeptech Precision v Council, paragraph 152 above, paragraph 83). 186 Contrary to what is claimed by the applicant, the institutions did not fail to have regard to the burden of proof in the present case. 187 It should be noted as a preliminary point that, in the application and at the hearing, the applicant referred to the case‑law cited at paragraph 184 above but did not dispute the substance of the institutions’ assessment of its MET claim set out at recitals 28 to 33 of the contested regulation. Nor did the applicant challenge the Commission’s evaluation, at recitals 37 to 44 of the contested regulation, of the information submitted by it, in particular in its letters of 2 March 2010 and 13 April 2010, to demonstrate that it fulfilled the requirements laid down in Article 2(7)(c) of the basic regulation, or claim that the Commission made a manifest error of assessment in that regard. 188 First, the applicant states, in reliance on Case T‑498/04 Zhejiang Xinan Chemical Industrial Group v Council [2009] ECR II‑1969, paragraphs 99 and 100, that the burden of proof on the exporting producer claiming MET is satisfied when it has provided the Commission with various items of documentary evidence whose purpose is to show that it meets the requirement set out in Article 2(7)(c) of the basic regulation, which was requested by the Commission in its questionnaire to producers claiming MET and verified by the Commission without calling into question its authenticity. 189 However, as observed at paragraph 187 above, the applicant does not claim that the evidence produced by it in support of its MET claim during the administrative procedure demonstrated that it fulfilled the requirement in the first indent of Article 2(7)(c) of the basic regulation and does not dispute the substance of the institutions’ assessment in that regard. The applicant’s argument cannot, therefore, succeed. 190 Second, the applicant states that the Commission required it ‘to show that the Chinese steel market was not subject to any significant interference by the Chinese authorities’ — evidence that it is impossible for the applicant to furnish. However, the applicant has failed to provide any evidence of any such requirement on the part of the institutions, a requirement which was also disputed by the Council in its defence. 191 As the Council correctly points out, it is for the applicant to demonstrate, by means of sufficient evidence, that it operates under market conditions and, in particular, that the cost of its inputs reflect market value. 192 Since the Commission concluded that the applicant purchased its raw materials during the investigation period on the domestic Chinese market and was thus benefiting from artificially low and distorted steel prices during that period (recitals 32 and 33 of the contested regulation) and the cost of inputs did not reflect market values, it was for the applicant to submit to the Commission evidence capable of refuting those conclusions. It follows that the applicant’s objection cannot be accepted. 193 As the plea alleging breach of the principle of sound administration is based solely on the purported infringement of the principles governing the burden of proof, it must also be rejected. 194 It follows that the third plea must be rejected, as must the application in its entirety. Costs 195 Under Article 87(2) of the Rules of Procedure, the unsuccessful party is to be ordered to pay the costs if they have been applied for in the successful party’s pleadings. In accordance with Article 87(4) of the Rules of Procedure, the institutions which have intervened in the proceedings are to bear their own costs. 196 Since the applicant has been unsuccessful, it must be ordered to bear its own costs and to pay the costs incurred by the Council, Vale Mill (Rochdale) and Colombo New Scal. 197 The Commission is to bear its own costs. On those grounds, THE GENERAL COURT (Eighth Chamber) hereby: 1. Dismisses the action; 2. Orders Since Hardware (Guangzhou) Co., Ltd to bear its own costs and to pay the costs incurred by the Council of the European Union, Vale Mill (Rochdale) Ltd and Colombo New Scal SpA; 3. Orders the European Commission to bear its own costs. Truchot Martins Ribeiro Popescu Delivered in open court in Luxembourg on 18 September 2012. [Signatures] Table of contents Legal context WTO Rules European Union law Background to the dispute The contested regulation Procedure and forms of order sought by the parties Law The first plea, alleging breach of Article 5(9), Article 9(3) to (6) and Article 17 of the basic regulation, in so far as a proceeding cannot be initiated against an individual company but should be directed at one or more countries and all the producers established there The first part of the plea, alleging breach of Article 5(9) of the basic regulation, read in conjunction with Article 17 thereof and interpreted in a manner consistent with WTO rules The second part of the first plea, alleging breach of Article 9(4) to (6) of the basic regulation, interpreted in a manner consistent with WTO rules The third part of the first plea, alleging breach of Article 9(3) of the basic regulation – Preliminary observations – The argument put forward as a principal argument, to the effect that Article 9(3) of the basic regulation requires the institutions to review the zero‑rated duty of producers whose dumping margin is de minimis, in accordance with Article 11(3) of that regulation – The argument put forward in the alternative, to the effect that the Commission carried out a de facto review of the applicant’s zero rate of duty, in breach of Article 9(3) of the basic regulation, interpreted in a manner consistent with the WTO Appellate Body report The second plea, alleging breach of Article 3(2), (3) and (5) of the basic regulation, on the basis that the anti dumping duties were imposed on the applicant without it having been established that the Union industry suffered material injury during the investigation period The third plea, alleging breach of the second subparagraph of Article 2(7)(c) of the basic regulation, in that the decision not to grant the applicant MET was taken in accordance with what the Commission knew of the effect of such a decision on its dumping margin, and breach of the principles governing the burden of proof and the principle of sound administration The first part of the third plea, alleging that the decision not to grant the applicant MET was taken in accordance with what the Commission knew of the effect of such a decision on the applicant’s dumping margin, in breach of the second subparagraph of Article 2(7)(c) of the basic regulation The second part of the third plea, alleging that the burden of proof imposed by the Commission on the applicant for the purpose of showing that it operates in a market economy is excessive and infringes the general principles of EU law Costs * Language of the case: French.