JUDGMENT OF THE GENERAL COURT (Seventh Chamber, Extended Composition)
19 March 2025 (*) (1)
( Dumping – Import of superabsorbent polymers originating in the Republic of Korea – Regulation (EU) 2022/547 – Definitive anti-dumping duty – Article 3(2), (3), (5), (6) and (7) of Regulation (EU) 2016/1036 – Article 9(4) of Regulation 2016/1036 – Determination of injury – Examination of the effect of the imports on prices for like products sold on the EU market – Analysis of price undercutting – Application of the product control number method – Causal link – Attribution and non-attribution analysis – Other known factors – Amount of anti-dumping duty – Rights of the defence – Principle of sound administration )
In Case T‑356/22,
LG Chem, Ltd., established in Seoul (South Korea), represented by P. Vander Schueren, E. Gergondet and A. Nosowicz, lawyers,
applicant,
v
European Commission, represented by G. Luengo and J. Zieliński, acting as Agents,
defendant,
supported by
BASF Antwerpen NV, established in Antwerp (Belgium),
and
Nippon Shokubai Europe NV, established in Antwerp,
represented by M.-S. Dibling and J. Pauwelyn, lawyers,
and by
Evonik Superabsorber GmbH, established in Essen (Germany), represented by T. Wessely, T. Oeyen, lawyers, and A. Çelebi, Solicitor,
interveners,
THE GENERAL COURT (Seventh Chamber, Extended Composition),
composed of K. Kowalik-Bańczyk, President, E. Buttigieg, G. Hesse, I. Dimitrakopoulos (Rapporteur) and B. Ricziová, Judges,
Registrar: M. Zwozdziak-Carbonne, Administrator,
having regard to the written part of the procedure,
further to the hearing on 11 April 2024,
gives the following
Judgment
1        By its action under Article 263 TFEU, the applicant, LG Chem, Ltd., seeks the annulment of Commission Implementing Regulation (EU) 2022/547 of 5 April 2022 imposing a definitive anti-dumping duty on imports of superabsorbent polymers originating in the Republic of Korea (OJ 2022 L 107, p. 27; ‘the contested regulation’), in so far as it concerns the applicant.
I.      Background to the dispute
2        The applicant is a Korean exporting producer of superabsorbent polymers (‘SAP’), which exports those products inter alia to the European Union.
3        SAP are composed of irregular, agglomerated or round-shaped granules, in powdered form, white in appearance and insoluble in water, resulting from the polymerisation of monomer molecules with cross-linkers to form cross-linked polymer networks, with a high capacity to absorb and retain water and aqueous liquids, falling, at the time when the contested regulation was adopted, under CN code ex 3906 90 90 (TARIC code 3906909017). The product concerned is defined as SAP originating in the Republic of Korea.
4        The purpose of SAP is to retain and absorb liquids to prevent any risk of leakage. In practice, due to their exceptional absorption capacity, SAP are mainly used in disposable sanitary products, such as baby diapers and adult incontinence diapers, and other hygiene applications, such as feminine hygiene products and pads for breastmilk. SAP can also be used in food-related industries, for example as refrigerant or freshness-keeping agents, and in household products, such as disposable heating packs or environment fragrance. In addition, SAP can be used in agriculture for water retention. The use of SAP in disposable sanitary products is, however, by far the predominant use compared to other applications.
5        On 4 January 2021, the European Superabsorbent Polymer Coalition lodged a complaint with the European Commission pursuant to Article 5 of Regulation (EU) 2016/1036 of the European Parliament and of the Council of 8 June 2016 on protection against dumped imports from countries not members of the European Union (OJ 2016 L 176, p. 21; ‘the basic regulation’), relating to dumping and the resulting material injury (‘the complaint’). At the time the complaint was lodged, the European Superabsorbent Polymer Coalition accounted for over 25% of the total Union production of SAP.
6        On 18 February 2021, pursuant to Article 5 of the basic regulation, the Commission published in the Official Journal of the European Union (OJ 2021 C 58, p. 73) the notice of initiation of an anti-dumping proceeding concerning imports of SAP originating in the People’s Republic of Korea.
7        The investigation of dumping and subsequent injury covered the period from 1 January 2020 to 31 December 2020 (‘the investigation period’). The examination of trends relevant for the assessment of injury covered the period from 1 January 2017 to the end of the investigation period (‘the period considered’).
8        On 8 March 2021, the applicant submitted comments on the definition of the product under investigation.
9        On 12 March 2021, the applicant requested a breakdown of the characteristics of the product control number (‘the PCN’). The same day, the applicant also sent its response to the sampling form for exporting producers.
10      On 1 April 2021, the applicant submitted comments on the complaint.
11      On 9 April 2021, the Commission submitted a note to the file, inviting all interested parties to submit data and comment on a new PCN breakdown. That breakdown would take into consideration differences among SAP products in terms of raw materials used in the production process, the shape of the product, its centrifugal retention capacity (‘CRC’), foamed and non-foamed products, its anti-caking, anti-discolouration and odour-control properties and its end uses.
12      On 22 April 2021, the Commission decided to modify the PCN breakdown originally proposed in the note to the file of 9 April 2021 referred to above, and submitted a further note to the file in which it proposed to use a revised PCN structure that took five factors into account, that is to say: (i) the raw materials used in the production process; (ii) the shape of the product; (iii) the CRC; (iv) the odour-control properties and; (v) the end uses. The applicant submitted comments on that note on 28 April 2021. On 3 May 2021, the applicant submitted revised tables based on the revised PCN structure proposed by the Commission in its note of 22 April 2021.
13      On 4 May 2021, the applicant submitted comments on the contributions made by the interested parties, in particular those of three Union producers, BASF Antwerpen NV (‘BASF’), Nippon Shokubai Europe NV (‘NSE’) and Evonik Operations GmbH (‘Evonik’).
14      On 27 May 2021, the applicant informed the Commission of its concerns as regards the respect of its rights of defence, due to the late addition to the non-confidential file of submissions made by Union producers and due to the presentation by them of inadequate non-confidential summaries. The applicant reiterated its concerns by email of 2 June 2021.
15      On 17 September 2021, the Commission published a document which pre-dated the general disclosure document, informing interested parties of its intention not to impose provisional measures. On 1 October 2021, BASF, NSE and Evonik requested a hearing and submitted post-hearing comments on 6 October 2021. The applicant addressed those comments on 29 October 2021.
16      On 24 January 2022, the Commission issued a general disclosure document setting out the essential facts and considerations on the basis of which it intended to impose definitive anti-dumping measures on SAP originating in the Republic of Korea, which proposed to impose an anti-dumping duty of 13.4% on the applicant (‘the general disclosure document’).
17      On 4 February 2022, the Commission sent an additional final disclosure document (‘the additional final disclosure’). On 8 February 2022, the applicant submitted comments on the two aforementioned documents. A hearing was held on 9 February 2022.
18      On 21 February 2022, the Commission sent a second additional final disclosure document (‘the second additional final disclosure’).
19      On 22 February 2022, the applicant submitted comments on the second additional final disclosure.
20      On 23 February 2022, a hearing was held on the second additional final disclosure.
21      On 24 February 2022, the applicant requested the intervention of the Hearing Officer, arguing that the disclosures in the second additional final disclosure were insufficient and that a one-day period to submit comments on the substantial changes made by the Commission in that document was inadequate. The hearing with the Hearing Officer took place on 25 February 2022.
22      On 5 April 2022, the Commission adopted the contested regulation, imposing an anti-dumping duty of 13.4% on imports into the European Union of the product concerned manufactured by the applicant. The contested regulation was published in the Official Journal of the European Union on 6 April 2022 and entered into force on the day following its publication.
II.    Forms of order sought
23      The applicant claims that the Court should:
–        annul the contested regulation in so far as it concerns the applicant;
–        order the Commission to pay the costs.
24      The Commission, supported by BASF, NSE and Evonik, contends that the Court should:
–        dismiss the action as unfounded;
–        order the applicant to pay the costs.
III. Law
25      In support of its action, the applicant relies on four pleas in law. The first plea alleges, in essence, that the Commission committed manifest errors of assessment, infringed Article 3(3) of the basic regulation and infringed the applicant’s rights of defence when analysing the price effect of imports from the Republic of Korea. The second plea alleges, in essence, that the Commission committed manifest errors of assessment and infringed Article 3(2), (5), (6) and (7) of the basic regulation and its obligation to state reasons by analysing the injury situation of Union producers in a biased manner and by attributing the alleged injury to Korean imports, rather than to other known factors. The third plea alleges, in essence, that the Commission committed manifest errors of assessment and infringed Article 3(3) and Article 9(4) of the basic regulation and infringed the applicant’s rights of defence by determining the injury margin based on a simplified PCN, by failing to provide adequate non-confidential summaries of the injury margin calculations and by failing to reflect other known factors of injury in its injury margin determination. The fourth plea alleges, in essence, that the Commission conducted the investigation in a manner that infringed the applicant’s rights of defence and the right to sound administration.
A.      First plea: manifest errors of assessment and infringement of Article 3(3) of the basic regulation and the rights of the defence in the analysis of the price effect of imports from the Republic of Korea on the Union industry’s products
26      The first plea comprises three parts. The first part alleges manifest errors of assessment and infringement of Article 3(3) of the basic regulation due to the use of a ‘simplified PCN’ to calculate price undercutting. The second part alleges infringement of the rights of the defence in that the price undercutting calculations sent to the applicant did not enable it to gain a proper understanding of the substance of the information submitted in confidence. The third part alleges manifest errors of assessment and infringement of Article 3(3) of the basic regulation on account of the allegations of price depression or price suppression resulting from Korean imports.
27      The Commission, supported by the interveners, disputes the applicant’s arguments.
1.      Preliminary remarks
28      In the first place, certain facts not disputed by the parties should be clarified. Thus, in the course of the anti-dumping investigation, the Commission found that the product concerned was defined as ‘superabsorbent polymers’, consisting of irregular, agglomerated or round-shaped granules, in powdered form, white in appearance and insoluble in water, resulting from a polymerisation of monomer molecules with cross-linkers to form cross-linked polymer networks, with a high capacity to absorb and retain water and aqueous liquids, originating in the Republic of Korea. The definition of the product concerned and the like product, although disputed at the start of the administrative procedure, is no longer disputed by the applicant before the Court, as confirmed by the applicant at the hearing.
29      Moreover, it is common ground that the Commission conducted an analysis to determine price undercutting by the imports originating in the Republic of Korea by comparison with prices in the Union industry, comparing the prices of the imports with the prices in the Union industry using the PCN system. That method of comparing PCN with PCN is not disputed per se by the applicant, as confirmed by it at the hearing.
30      In the second place, it should be recalled that PCNs are codes used in anti-dumping investigations to establish matches between product types. During an investigation, the undertakings contacted are invited to classify their products in categories corresponding to those codes. Characteristics intended to describe the goods concerned are attached to those codes (judgment of 19 May 2021, China Chamber of Commerce for Import and Export of Machinery and Electronic Products and Others v Commission, T‑254/18, EU:T:2021:278, paragraph 545).
31      Using that method, each type of product produced and sold by the exporting producers sampled and each type of product produced and sold by the sampled Union producers is attributed a unique PCN, depending on the principal characteristics of the product (in the present case, SAP) (see, to that effect, Opinion of Advocate General Pitruzzella in Commission v Hubei Xinyegang Special Tube, C‑891/19 P, EU:C:2021:533, point 34).
32      The PCN nomenclature is thus used to identify the types of characteristics which, within the category constituted by the product concerned, enable prices and values to be compared in the investigation (judgment of 19 May 2021, China Chamber of Commerce for Import and Export of Machinery and Electronic Products and Others v Commission, T‑254/18, EU:T:2021:278, paragraph 556).
33      According to settled case-law, the assessment of the passing-on of anti-dumping duties by using a PCN-by-PCN method is considered appropriate, in particular where complex products are involved, the models of which have different technical characteristics and prices which may vary significantly (see judgment of 22 September 2021, Severstal v Commission, T‑753/16, not published, EU:T:2021:612, paragraph 72 and the case-law cited).
34      In the third place, as regards the legal framework, it should be borne in mind that Article 3 of the basic regulation concerns the determination of the existence of injury caused by the dumped imports.
35      Article 3(3) of the basic regulation provides inter alia that, with regard to the effect of the dumped imports on prices, consideration is to be given to whether there has been significant price undercutting by the dumped imports as compared with the price of a like product of the Union industry, or whether the effect of such imports is otherwise to depress prices to a significant degree or prevent price increases, which would otherwise have occurred, to a significant degree.
36      Moreover, it follows from Article 3(1), (2) and (3) of the basic regulation that it does not lay down any particular method for determining the effect of the dumped imports on prices of like products of the Union industry (see judgment of 14 September 2022, Nevinnomysskiy Azot and NAK “Azot” v Commission, T‑865/19, not published, EU:T:2022:559, paragraph 165 and the case-law cited).
37      In the fourth place, in the sphere of the common commercial policy and, most particularly, in the realm of measures to protect trade, it follows from the settled case-law of the Court of Justice that the EU institutions enjoy a broad discretion by reason of the complexity of the economic and political situations which they have to examine, with the result that the judicial review of that broad discretion must be limited to verifying whether relevant procedural rules have been complied with, whether the facts relied on have been accurately stated, and whether there has been a manifest error in the appraisal of those facts or a misuse of powers (see judgment of 12 May 2022, Commission v Hansol Paper, C‑260/20 P, EU:C:2022:370, paragraph 58 and the case-law cited).
38      The Commission enjoys a broad discretion in that regard, inter alia, as regards the analysis of price undercutting, where it involves an economically complex issue in respect of which the basic regulation does not lay down any particular methodology (see, to that effect, judgments of 20 January 2022, Commission v Hubei Xinyegang Special Tube, C‑891/19 P, EU:C:2022:38, paragraph 169, and of 12 May 2022, Commission v Hansol Paper, C‑260/20 P, EU:C:2022:370, paragraph 99).
39      The Court of Justice has also repeatedly held that the General Court’s review of the evidence on which the EU institutions based their findings does not constitute a new assessment of the facts replacing that made by the institutions. That review does not encroach on the broad discretion of those institutions in the field of commercial policy, but is restricted to showing whether that evidence was able to support the conclusions reached by the institutions. The General Court must therefore not only establish whether the evidence put forward is factually accurate, reliable and consistent but also ascertain whether that evidence contained all the relevant information which had to be taken into account in order to assess a complex situation and whether it was capable of substantiating the conclusions reached (judgment of 20 January 2022, Commission v Hubei Xinyegang Special Tube, C‑891/19 P, EU:C:2022:38, paragraph 37; see also judgment of 21 September 2023, China Chamber of Commerce for Import and Export of Machinery and Electronic Products and Others v Commission, C‑478/21 P, EU:C:2023:685, paragraph 114 and the case-law cited).
40      As regards questions of law, however, the General Court carries out a comprehensive review, including of the interpretation to be given to the legal provisions on the basis of objective factors and an examination of whether or not the conditions of application of such a provision are met (see, to that effect, judgments of 11 July 1985, Remia and Others v Commission, 42/84, EU:C:1985:327, paragraph 34, and of 9 November 2022, Cambodia and CRF v Commission, T‑246/19, EU:T:2022:694, paragraph 45).
41      In the fifth place, the burden of proving a manifest error lies with the applicant, which must provide conclusive evidence in support of its claim (see judgment of 19 September 2019, Zhejiang Jndia Pipeline Industry v Commission, T‑228/17, EU:T:2019:619, paragraph 127 and the case-law cited).
42      In the sixth place, it should be borne in mind that, according to the case-law, different conclusions drawn in a definitive regulation cannot be interpreted alone, but in the light of all the reasoning developed therein (see judgment of 28 February 2017, Canadian Solar Emea and Others v Council, T‑162/14, not published, EU:T:2017:124, paragraph 210 and the case-law cited).
43      The arguments put forward by the applicant must be examined in the light of the foregoing considerations.
2.      First part of the first plea: manifest errors of assessment and infringement of Article 3(3) of the basic regulation due to the use of a ‘simplified PCN’ to calculate price undercutting
44      In support of the first part of the first plea, the applicant submits, in essence, that the use in the contested regulation of a ‘simplified PCN’ is based on a manifest error of assessment. It argues that the Commission wrongly based its calculations on that ‘simplified PCN’ – leading to the 14.7% weighted average undercutting found with respect to the applicant – instead of the code which it had set out in the note to the file of 22 April 2021, thereby failing to take into account differences in CRC and in uses of SAP in the hygiene sector. According to the applicant, a PCN is attributed on the basis of the principal characteristics of the product concerned. It submits that, in the present case, the ‘principal’ characteristics of SAP are defined in section 2.3.5 of the contested regulation as being raw materials, shape, CRC, odour control and uses. In the context of the first part of the first plea, it puts forward three complaints.
45      According to the first complaint, the differences in CRC and in uses have an impact on costs and prices which should have been taken into account by the Commission. The applicant submits that, during the administrative procedure, it had in fact demonstrated that all the characteristics which it proposed for the PCN breakdown had an impact on costs and prices. According to the applicant, if CRC and use are price and cost factors for differentiating product grades for the purpose of calculating the dumping margin for Korean imports, those characteristics are also price and cost factors for the purpose of calculating the undercutting margin for the same Korean imports.
46      According to the applicant’s second complaint, the contested regulation denies the existence of different SAP grades or specifications by failing to take account of differences in CRC and by simply contrasting uses in hygiene products with industrial uses. The applicant submits in that respect that CRC is the most basic technical property for measuring the functionality of SAP and that SAP intended for hygiene products should meet specific requirements. It adds that the different grades or specifications of SAP are not interchangeable and are offered at different prices.
47      In the third complaint, the applicant states that the contested regulation contains no explanation of how the CRC and uses of SAP did not affect costs or prices, even though recital 86 thereof recognises those two characteristics as factors influencing costs and prices. The applicant also submits that the Commission based its dumping margin calculations concerning the applicant on the PCN disclosed on 22 April 2021, and accordingly, it is inconsistent to claim that the characteristics used in that PCN breakdown affect costs and prices for the purpose of dumping and not for the purpose of undercutting. According to the applicant, the Commission therefore wrongly established the existence of significant price undercutting by Korean imports by means of the ‘simplified PCN’ and, as a result, the Commission infringed Article 3(3) of the basic regulation.
48      Moreover, the applicant argues that, in recital 182 of the contested regulation, the Commission erroneously relies on a non-existent obligation to achieve a 100% match to assert that there is a principle that the Commission, in its examination of the price effects of dumped imports on the Union industry and in the analysis of price undercutting in particular, must invariably take into consideration all the product types in question sold by that industry. Lastly, the applicant submits that it has demonstrated in its written submissions before the Court, on the basis of intervening trends during the period considered, that Korean imports had no influence on the prices of Union producers.
49      In the present case, it should be recalled, first of all, that the basic regulation does not impose any particular method which the Commission is required to use for calculating price undercutting. However, it is apparent from the very wording of Article 3(3) of that regulation that the method used to determine possible price undercutting must, in principle, be applied at the level of the ‘like product’, within the meaning of Article 1(4) of that regulation, even though that product may consist of different product types falling within several market segments. Accordingly, the basic regulation does not, in principle, impose any obligation on the Commission to carry out an analysis of the existence of price undercutting at a level other than that of the like product (judgment of 20 January 2022, Commission v Hubei Xinyegang Special Tube, C‑891/19 P, EU:C:2022:38, paragraphs 73 to 75; see also judgment of 21 September 2023, China Chamber of Commerce for Import and Export of Machinery and Electronic Products and Others v Commission, C‑478/21 P, EU:C:2023:685, paragraph 165 and the case-law cited).
50      In order to ensure that the analysis of price undercutting is objective, the Commission may, in certain circumstances, be required to carry out such an analysis at the level of the market segments of the product in question, even though the broad discretion enjoyed by that institution to determine, inter alia, the existence of injury extends, at the very least, to decisions on the choice of method of analysis, to the data and evidence to be gathered, to the method of calculation to be used in order to determine the undercutting margin and to the interpretation and evaluation of the evidence gathered (judgment of 20 January 2022, Commission v Hubei Xinyegang Special Tube, C‑891/19 P, EU:C:2022:38, paragraph 78).
51      More specifically, in a particular situation characterised by a high concentration of domestic sales and dumped imports in separate segments and by price differences that are very significant between those segments, in order to ensure the objectivity of the analysis of the existence of price undercutting, the Commission, even if it has broad discretion as to the method for carrying out that analysis, may be required to take account of the market shares of each product type and those price differences (judgment of 20 January 2022, Commission v Hubei Xinyegang Special Tube, C‑891/19 P, EU:C:2022:38, paragraph 81).
52      In that regard, it must be stated that, where the product concerned contains a wide range of goods which have considerable differences with regard to their characteristics and their prices, it may prove necessary to group them under categories which are more or less homogeneous. According to the case-law, the purposes of that grouping is to allow for a fair comparison between comparable products and thereby to avoid an incorrect calculation of the dumping margin, on the one hand, and of the injury, on the other, owing to unsuitable comparisons. If the applicant intends to call into question the approach taken by the Commission in that context, they must demonstrate that the codification proposed by that institution is manifestly inappropriate (see judgment of 19 May 2021, China Chamber of Commerce for Import and Export of Machinery and Electronic Products and Others v Commission, T‑254/18, EU:T:2021:278, paragraphs 550 to 552 and the case-law cited).
53      In the present case, it is appropriate to examine first the approach followed by the Commission in the contested regulation as regards the breakdown of the PCN and then analyse whether the applicant’s complaints establish that that approach is vitiated by manifest errors of assessment.
(a)    The Commission’s approach to the PCN breakdown
54      The question on which the parties disagree in the present complaint concerns, in essence, the fact that, during its investigation, the Commission used one PCN in the calculation of the dumping margin and a different PCN in the calculation of the price undercutting.
55      In that regard, it is common ground that, during the investigation, the Commission excluded from the PCNs certain characteristics which, although originally attached to them, did not appear to it to be relevant. In the present case, the Commission used a more detailed PCN in the calculation of the dumping margin, which took into account five technical factors (the raw materials, the shape of the product, the CRC, the odour-control properties and the end uses, including in the hygiene sector), and a ‘simplified PCN’, which did not take into account two of those factors (the CRC and the different end uses in the hygiene sector) in order to calculate the price undercutting.
56      The applicant maintains, in essence, in that regard that the characteristics initially attached to the relevant PCNs were important and should have been retained throughout the investigation, without the Commission being able to make the simplification referred to above.
57      More specifically, the Commission followed the approach described below during its investigation.
58      First of all, as indicated in recital 62 of the contested regulation, the Commission had initially provided a single PCN in the template questionnaires in the course of its investigation.
59      It is stated in recitals 63 and 76 of the contested regulation that the applicant subsequently submitted a set of comments claiming that SAP could not be considered a homogeneous product given that, in its view, differences in terms of physical, technical and chemical characteristics affected the end uses and interchangeability, as well as the manufacturing processes and the associated costs of production and sales prices, of the product under investigation. The applicant accordingly proposed a PCN breakdown which differentiated SAP products in terms of raw materials used in the production process, shape, their CRC, additives and additional functionalities – including foamed products, anti-caking, anti-discolouration and odour control – and uses. As indicated in recitals 77 to 79 and 83 of the contested regulation, the sampled Union producers objected to the PCN breakdown proposed by the applicant and claimed that, although it was correct that SAP was characterised by a number of different parameters that may vary depending on customers’ requirements and preferences, none of the parameters was more relevant than the others in the differentiation of SAP. They claimed, inter alia, first, that the differences in terms of product shape, CRC, additives and additional functionalities did not preclude a comparison of the products and did not generate any significant price difference and, second, that SAP intended for hygiene uses had to be distinguished from those intended for other uses, given that the end uses could give rise to differences in price, without it being necessary to draw a distinction within the hygiene market. However, as indicated in recital 84 of the contested regulation, two SAP users welcomed the decision to introduce a new PCN breakdown.
60      Secondly, as stated in recital 86 of the contested regulation, the Commission, after having considered all the comments received by the interested parties and based on the evidence on the file, decided, in the course of the investigation, to modify the PCN breakdown proposed initially. The PCN breakdown was revised taking into consideration differences among SAP products in terms of: (i) raw materials used in the production process; (ii) shape of the product; (iii) CRC; (iv) odour-control properties; and (v) end uses of SAP, including different uses in the hygiene sector (namely, ‘adult’, ‘feminine’ and ‘general baby hygiene’). The proposed differences arising from the presence or absence of foam in the product and anti-caking and anti-discolouration properties were excluded. Hence, the dumping calculation, set out in recitals 100 to 150 of the contested regulation, was done on the basis of that revised PCN breakdown, which took into account the five characteristics attached to the relevant PCNs, referred to above, as confirmed by the Commission in its written pleadings lodged with the Court.
61      Thirdly, in Annex 3a to the general disclosure document, entitled ‘Methodology for undercutting calculations’, the Commission stated that ‘the comparison between the prices of the Union industry and the exporting producers [had been] made on the basis of a simplified PCN’. In that context, the Commission observed that two modifications had been made to the PCN: (i) the CRC field, and (ii) the end use field. As regards the CRC, the Commission stated that that PCN component had been removed as no interested party had demonstrated a particular correlation to the cost of production or sale price to independent users. As regards the end use, the Commission stated that a distinction had been drawn between products with end use in the hygiene sector, on the one hand, and the industrial sector, on the other (it thus removed the criterion for different end uses in the hygiene sector, namely, ‘adult’, ‘feminine’ and ‘baby & general hygiene’ that it had used previously).
62      Thus, the ‘simplified PCN’ was based on four factors: raw materials, shape of product, odour control and end uses (divided between hygiene or industrial use). With those factors taken into account, three PCNs (or product types) were identified and used for the purpose of examining the undercutting.
63      Recital 181 of the contested regulation states the following in that regard:
‘[The applicant] further argued that the Commission used a PCN for comparing prices of imports by [the applicant] to prices of the sampled Union producers which was too simple and did not take into account all characteristics mentioned in [the applicant’s] submission of 28 April 2021, i.e. raw material, shape, CRC, odour control, foamed, anti-caking, anti-discolouration and use. In particular differences in CRC might explain, on its own, the undercutting margin of [14.7%].’
64      As set out in recital 182 of the contested regulation, in response to the applicant’s arguments, the Commission stated the following:
‘The Commission refers to section 2.3.5 [of that regulation], which demonstrates that the Commission collected the data in a detailed form to be in the position to analyse the cost and price effect of the different characteristics proposed by [the applicant], including CRC. However, these data, together with the information collected and verified from users, did not confirm the alleged cost and price influence of the characteristics, other than the ones applied by the Commission. The Commission therefore rejected the claim that a more detailed PCN should have been used.’
65      It is apparent from those considerations that, in essence, the Commission reached the conclusion that, on the basis of a set of broader data coming from the Union producers and users in the Union, two factors initially taken into account in the PCN breakdown (CRC and different uses of the product in the hygiene sector) did not have a significant influence on prices.
66      In its written submissions lodged with the Court, the Commission stated in that regard that, when analysing the questionnaire replies received from both the applicant and from the Union industry, it found only a 28.3% matching between the PCNs sold by the Union industry and those sold by the applicant. The Commission argues therefore that it had examined, on the basis of the sales data received, whether some of the characteristics of the PCNs initially added could be removed and whether the PCN structure could be simplified in order to increase the matching. It therefore decided to remove CRC and to simplify the end use criteria to obtain ‘hygiene’ and ‘industrial’ products respectively, as explained by it in the general disclosure document.
67      It is therefore appropriate to examine whether the applicant managed to establish that the approach taken by the Commission to calculate price undercutting was vitiated by manifest errors of assessment.
(b)    The influence of CRC and end uses on costs and prices in the hygiene sector (first complaint)
(1)    CRC
68      The applicant submits, with respect to CRC, that differences in CRC entail cost differences in the order of 5 to 15% and significant price differences in the order of 2.5 to 30%. In its submission, that analysis had already been carried out by it during the administrative procedure. It adds that, in its written pleadings, the Commission does not refute the influence of CRC on costs, but only its influence on prices. In the reply, the applicant states that, in its view, that influence on prices is present but is not linear.
69      The Commission acknowledges that differences in CRC have an influence on prices but emphasises that price differences are not linear. According to the Commission, in five out of eight cases presented in Annex A.5 to the application, when the CRC factor increases, SAP prices decrease. Moreover, relying on its analysis based on average sales prices for each PCN sold by the Union industry set out in Annex B.2 to the defence, it observes that, on the Union industry side, prices decrease as the CRC factor increases. The Commission also observes that mere price differences may be caused by a plethora of different factors, including the dates of the relevant transactions, volumes, customer relations and customer bargaining power.
70      The interveners state that, during the administrative procedure, they submitted certain invoices showing that two SAP products with very different CRC were sold at the same price. In their view, although it is possible that CRC and end uses affect the applicant’s costs and prices, the same does not hold true for other superabsorbent polymer producers situated in the European Union.
71      In that regard, as rightly pointed out by the Commission, it is apparent from Annex A.5 to the application that, amongst the ‘CA 3FCDNB’, ‘CA 4FCDNB’, ‘CA 6FCDNB’ and ‘CA 7FCDNB’ PCNs (namely, PCNs in which only the third number, which represents the CRC factor, is differentiated), the price shows significant fluctuations which are not characterised by any homogeneity or foreseeability. Moreover, it is apparent from Annex B.2 to the defence that there are minor price differences between PCNs with a different CRC factor, but that the correlation between those differences is not obvious. For example, for the PCN ending in ‘CANB’, the price fluctuates considerably according to the differentiated CRC. Consequently, the Court finds that, all other properties being maintained constant, there is no correlation between the CRC and significant and consistent cost and price differences.
(2)    End uses in the hygiene sector
72      The applicant submits that differences in the adult, feminine, infant (baby) and industrial segments entail cost differences in the order of 1 to 15% and significant price differences in the order of 1 to 15%.
73      In that regard, although the Commission acknowledges that the applicant has established a price difference between the categories of products for adults and women, it maintains it is minor in relation to the price difference between products for adults and industrial products, also established by the applicant. On that basis, the Commission submits that the applicant has failed to demonstrate a ‘consistent’ price difference between the different types of products.
74      In support of its line of argument, the Commission produced before the Court, by way of Annex B.3 to the defence, an analysis listing the different categories of end users and the relevant price differences. The applicant disputes the admissibility of that annex on the ground that the analysis contained therein is not to be found in either the contested regulation or the general disclosure document.
75      As regards the admissibility of Annex B3, disputed by the applicant in its written pleadings, it should be borne in mind that the statement of reasons required under Article 296 TFEU must be appropriate to the measure in question and, in the case of a regulation as in the present case, may be limited to indicating the general situation which led to its adoption, on the one hand, and the general objectives which it is intended to achieve, on the other. Consequently, it is not possible to require that the EU institutions should set out the various facts, which may be very numerous and complex, on the basis of which the regulation was adopted, or a fortiori that they should provide a more or less complete evaluation of those facts. Moreover, the statement of reasons required by Article 296 TFEU does not require the Commission to specify exhaustively the various facts, which may be very numerous and complex, in the light of which a regulation imposing anti-dumping duties was adopted, nor, a fortiori, to provide a more or less complete assessment thereof (see judgment of 20 January 2022, Commission v Hubei Xinyegang Special Tube, C‑891/19 P, EU:C:2022:38, paragraphs 87, 89 and 91 and the case-law cited).
76      In addition, since, as regards the analysis of price undercutting, the essential objective pursued by the Commission is apparent from the contested regulation, that regulation does not have to include specific reasons for each of the numerous factual arguments relied on in relation to that analysis (see, to that effect, judgment of 20 January 2022, Commission v Hubei Xinyegang Special Tube, C‑891/19 P, EU:C:2022:38, paragraphs 92 and 95).
77      Hence, in the present case, the Court finds that the data provided by the Commission in Annex B.3 include additional details and information on the grounds already contained in the contested regulation, set out in particular in recital 182 of that regulation (see, to that effect, judgment of 20 January 2022, Commission v Hubei Xinyegang Special Tube, C‑891/19 P, EU:C:2022:38, paragraph 93). The Court may, therefore, take into consideration the data contained in Annex B.3 for the purpose of reviewing the lawfulness of the contested regulation.
78      As regards the substance and content of Annexes A.5 and B.3, the Court notes that it is apparent from both Annex A.5 and B.3 that, although there are price differences in relation to end use, they must be categorised as minor. In particular, it is apparent from Annex A.5 to the application that there is only a minor difference in the order of 0.5 to 5% for the ‘CA 7NCNNF’ and ‘CA 7NCNNA’ PCNs (namely, the PCNs in which only the last letter, which represents the end use, is different). The applicant has failed to establish how that difference may be categorised as significant. Moreover, it is apparent from Annex B.3 that there was a difference of at least 8% when the Commission compared eight PCNs according to their different end uses in the hygiene sector. That difference may be categorised as minor in relation to the significant difference of over 50% in the average prices between the hygiene and industrial categories of products. It follows from those considerations that the differences in use in the adult, feminine and infant segments have an influence on prices which does not seem to be significant.
79      Consequently, the Court finds that, all other properties being maintained constant, there is no correlation between uses in the hygiene sector and significant and consistent cost and price differences. Consequently, it has not been established that the assessment contained in recital 182 of the contested regulation is manifestly incorrect. The applicant’s complaint on that point must therefore be rejected as unfounded.
(c)    Interchangeability of SAP (second complaint)
80      The applicant submits that SAP is not a homogeneous product. According to the applicant, CRC is the most basic technical property to measure the functionality of SAP, and each SAP user, including diaper manufacturers, uses different types of SAP with different CRC according to the type and characteristics expected from the product incorporating SAP. It adds that SAP used for baby, adult and feminine hygiene uses also corresponds to different products, as customers will require different characteristics depending on the end use and target audience of the hygiene products. The applicant adds that the different grades or specifications of SAP are not interchangeable and are offered at different prices.
81      The Commission submits that there are no specific SAP for baby diapers which are different from those used for incontinence diapers intended for adults. Therefore, the differentiation based on the end hygiene use was not a criterion on which Union producers based themselves for their manufacture.
82      In the present case, it should be borne in mind that, in recital 92 of the contested regulation, the Commission found that ‘all SAP products were subject to a certain extent to different technical or chemical specifications’, that ‘however, in the end, they [had] the same end use and [were] exchangeable, still falling under the definition of the product concerned’ and that ‘any minor differences in specifications are catered for by the additional information at the level of the PCN’.
83      It should be emphasised in that regard that, as stated in paragraph 28 above, the definition of the product concerned and the like product was not disputed per se by the applicant before the Court. Moreover, the applicant has not adduced any specific evidence supporting its argument as outlined above. Hence, the applicant has failed to demonstrate in a sufficiently substantiated manner that the Commission made a manifest error of assessment in finding that the SAP were interchangeable. The applicant’s complaint on that point must therefore be rejected as unfounded.
(d)    The use of different PCN structures for the purpose of calculating the dumping margin and price undercutting (third complaint)
84      The Court finds, first of all, like the Commission and Evonik, that the objectives of the calculations of the dumping margins and of the price undercutting are different.
85      Thus, in order to analyse the injury, products originating in the Republic of Korea are compared with those produced in the European Union. Since the objective is to examine the effect of imports of the former on the price of the latter, there must, in order to make that comparison, be a match between the types actually compared. In the determination of dumping, the comparison relates to the exporting producers’ sales prices on their domestic market and the sales prices of the products exported to the European Union by those exporting producers (see, to that effect, judgment of 19 May 2021, China Chamber of Commerce for Import and Export of Machinery and Electronic Products and Others v Commission, T‑254/18, EU:T:2021:278, paragraphs 558 and 559).
86      To make the comparison described above in the determination of dumping, the Commission must identify the products which are closest, in the light of the characteristics attached to the PCNs, to those products exported by the exporting producers to the European Union. In order to make that identification, the Commission’s services gradually discount the characteristics which make it impossible to find a match between the products concerned, until they have been able to identify those which will enable a comparison to be made. In such a context, the difference between the PCNs used in the dumping determination and those used in the injury analysis can be explained by the difference between the products to be compared in order to carry out the necessary calculations for those two areas (judgment of 19 May 2021, China Chamber of Commerce for Import and Export of Machinery and Electronic Products and Others v Commission, T‑254/18, EU:T:2021:278, paragraphs 561 and 562). Therefore, contrary to the applicant’s assertions, it is not inconsistent to use less detailed PCN in the context of the injury evaluation, in view of the appurtenant characteristics, as compared to the PCN used in the calculation of the dumping margin.
87      Moreover, in the present case, it is common ground that the Korean import prices contained in Table 3 of the contested regulation were systematically lower than the sampled Union producers’ sale prices set out in Table 7 of that regulation. The Commission nonetheless exercised its discretion and decided to carry out a more detailed analysis by conducting a price comparison between differentiated sub-categories of SAP defined by it, which again yielded the same result, namely, significant price undercutting by dumped imports.
88      Moreover, as indicated in paragraph 52 above, the Commission’s choice to regroup products into more or less homogeneous categories was intended to enable an equitable comparison between comparable products, thereby avoiding both an incorrect calculation of the dumping margin and of the injury due to inappropriate comparisons. In the present case, it is apparent from the contested regulation and from paragraphs 80 to 83 above that the products at issue are interchangeable. In that context, in order to call duly into question the approach taken by the Commission in the present case, the applicant must demonstrate that the codification proposed by the Commission is manifestly inappropriate.
89      However, it is apparent from the analysis in paragraphs 68 to 78 above that the applicant has failed to demonstrate that the Commission’s choice to regroup the products into broader categories, by removing the CRC and simplifying the criteria relating to end use, could have a significant impact on costs or prices, with the result that that new codification (‘the simplified PCN’) used by the Commission to calculate the price undercutting would be manifestly inappropriate.
90      Consequently, the first part of the first plea must be rejected as unfounded.
3.      Second part of the first plea: infringement of the rights of the defence due to the price undercutting calculations disclosed to the applicant not permitting a proper understanding of the substance of the information submitted in confidence
91      In support of the second part of its first plea, the applicant argues, in essence, that its rights of defence were infringed on the ground that the undercutting calculations were overly redacted and did not allow the applicant to make its views known on the correctness and relevance of those calculations. According to the applicant, it submitted comments during the administrative procedure referring to the lack of information from the Commission on the quantities the Commission had taken into consideration for Union producers and on the undercutting calculations relating to the PCN concerned. The applicant states, in that regard, that those calculations provide only ranges which do not relate to key elements, such as quantities sold or the unit sales price. The applicant submits that it had drawn attention to the specific nature of the SAP market throughout the administrative investigation, explaining that the competitive overlap between SAP manufactured by the Union industry and SAP imported from the Republic of Korea was limited, which taints any potential price comparison. The representativeness of the undercutting calculations should therefore have been determined by the applicant. According to the applicant, the Commission has not explained why it did not provide ranges for all the figures, since the fact that the data in question concerned only two undertakings is not, in its view, an excuse.
92      It must be noted first of all that, respect for the rights of the defence is, in all proceedings initiated against a person which are liable to culminate in a measure adversely affecting that person, a fundamental principle of EU law which must be guaranteed even in the absence of any rules governing the proceedings in question. Respect for that principle is of crucial importance in anti-dumping investigations (see judgment of 19 May 2021, China Chamber of Commerce for Import and Export of Machinery and Electronic Products and Others v Commission, T‑254/18, EU:T:2021:278, paragraphs 451 and 452 and the case-law cited).
93      In accordance with that principle, the undertakings concerned should have been placed in a position during the administrative procedure in which they could effectively make known their views, first, on the correctness and relevance of the facts and circumstances alleged and, second, on the evidence presented by the Commission in support of its allegation concerning the existence of dumping and the resultant injury. In that context, the EU institutions must act with due diligence by seeking to provide the undertakings concerned with information relevant to the defence of their interests while having a degree of freedom to choose, if necessary on their own initiative, the appropriate means of providing such information to them for the purposes of such disclosure (see judgment of 19 May 2021, China Chamber of Commerce for Import and Export of Machinery and Electronic Products and Others v Commission, T‑254/18, EU:T:2021:278, paragraphs 453 and 454 and the case-law cited).
94      Those principles are given effect in the basic regulation, which provides for a system of guarantees pursuing two objectives, namely, first, to allow interested parties effectively to defend their interests and, second, to preserve the confidentiality of the information gathered during the investigation (see judgment of 19 May 2021, China Chamber of Commerce for Import and Export of Machinery and Electronic Products and Others v Commission, T‑254/18, EU:T:2021:278, paragraph 455 and the case-law cited).
95      As regards the first objective, the procedural guarantees guaranteeing the interested parties’ right to information are defined, first of all in Article 6(7) and then in Article 20 of the basic regulation. Accordingly, Article 6(7) of the basic regulation provides that, upon written request, the interested parties, including the exporters and their representative associations, may inspect all information made available by any party to an investigation, as distinct from internal documents prepared by the authorities of the European Union or those of the Member States, which is relevant to the presentation of their cases, not confidential and is used in the investigation. Article 20 of the basic regulation identifies two points in time for communicating to the interested parties, including exporters and their representative associations, specific information on the essential facts and circumstances on which anti-dumping measures are capable of being based, namely, first, after the imposition of provisional measures and, second, before the imposition of definitive measures (see judgment of 19 May 2021, China Chamber of Commerce for Import and Export of Machinery and Electronic Products and Others v Commission, T‑254/18, EU:T:2021:278, paragraphs 457 to 459 and the case-law cited).
96      As regards the second objective, the basic regulation determines the rules to be followed in order to respect the confidentiality of information gathered during the investigation. In that context, Article 19(1) of the basic regulation lays down the principle that confidential information must be treated as such by the authorities. Confidential information is information which is confidential by nature or which has been designated as such by the persons or entities which provided it. Information, the disclosure of which would be of significant competitive advantage to a competitor or would have a significantly adverse effect upon a person supplying the information or upon a person from whom that person has acquired the information, falls within the first category. As regards the second category, the first sentence of Article 19(5) of the basic regulation prohibits the Commission, the Member States and their officials from revealing, without the specific permission of that person or entity, any information provided by a person or entity which has requested confidential treatment. According to the second sentence of Article 19(5) of the basic regulation, the prohibition on disclosure also applies to exchanges of information between the Commission and the Member States and to any internal documents of the institutions and the Member States, the only permitted exceptions being those expressly provided for in the basic regulation (see judgment of 19 May 2021, China Chamber of Commerce for Import and Export of Machinery and Electronic Products and Others v Commission, T‑254/18, EU:T:2021:278, paragraphs 460 to 463 and the case-law cited).
97      It should also be noted that EU law includes guidance as to how those two objectives pursued by the legislation relate to one another (see, to that effect, judgment of 19 May 2021, China Chamber of Commerce for Import and Export of Machinery and Electronic Products and Others v Commission, T‑254/18, EU:T:2021:278, paragraph 464 and the case-law cited).
98      Certain provisions in the basic regulation make clear the importance attached to confidentiality. Accordingly, Article 6(7) of that regulation indicates that the confidentiality of information supplied by a party concerned by the investigation precludes the interested parties from inspecting it. Furthermore, Article 20(4) of the basic regulation provides that final disclosure must be given ‘due regard being had to the protection of confidential information’ (see judgment of 19 May 2021, China Chamber of Commerce for Import and Export of Machinery and Electronic Products and Others v Commission, T‑254/18, EU:T:2021:278, paragraph 465 and the case-law cited).
99      At the same time, the case-law provides that the requirement to respect confidential information cannot deprive the rights of the defence of their substance (see judgment of 19 May 2021, China Chamber of Commerce for Import and Export of Machinery and Electronic Products and Others v Commission, T‑254/18, EU:T:2021:278, paragraph 466 and the case-law cited).
100    In order to place the two objectives in relation to one another, Article 19(2) of the basic regulation states that, where confidential information is communicated, a non-confidential summary must be provided by the party requesting confidentiality, and that summary must be in sufficient detail to permit interested parties to gain a reasonable understanding of the substance of the information submitted. With the same objective of respecting the rights of the defence when confidentiality precludes the disclosure of information, Article 19(4) of the basic regulation makes the institutions responsible for disclosing general information, in particular the reasons on which decisions taken under the basic regulation are based (see judgment of 19 May 2021, China Chamber of Commerce for Import and Export of Machinery and Electronic Products and Others v Commission, T‑254/18, EU:T:2021:278, paragraphs 467 and 468 and the case-law cited).
101    It should also be borne in mind that, although an applicant cannot be required to show that the Commission’s decision would have been different in the absence of the procedural irregularity in question, but simply that such a possibility cannot be totally ruled out, since that party would have been better able to defend itself had it not been for that irregularity, the fact remains that the existence of an irregularity relating to the rights of the defence can result in the annulment of the measure in question only where there is a possibility that, due to that irregularity, the administrative procedure could have resulted in a different outcome, and thus in fact adversely affected the rights of the defence (see judgment of 5 May 2022, Zhejiang Jiuli Hi-Tech Metals v Commission, C‑718/20 P, EU:C:2022:362, paragraph 49 and the case-law cited).
102    On the other hand, it is for the applicant to establish specifically how it would have been better able to ensure its defence in the absence of such an irregularity, without merely pleading that it was impossible for it to provide comments on hypothetical situations (see judgment of 1 June 2017, Changmao Biochemical Engineering v Council, T‑442/12, EU:T:2017:372, paragraph 145 and the case-law cited).
103    In the light of those considerations, the Court finds that the injury calculations, including, in that context, the calculation of the effects of Korean imports on prices, include confidential data. First, the undercutting calculations, which enable an assessment to be made of the effect of imports on prices of the products on the EU market, stem from a comparison between the export prices of the sampled Korean exporting producers and the prices of similar models or products of the sampled EU producers. Second, the injury to the EU industry is assessed by taking into account the impact of the imports on the EU industry. In that respect, the confidential data of the EU industry, namely data from the sampled EU producers relating to prices and factors affecting prices, labour costs, inventories, profitability, cash flow, investments, return on investments and ability to raise capital are gathered and analysed in relation to the microeconomic indicators assessed by the Commission. The same is true of the data of the EU industry producers relating to production, production capacity, capacity utilisation, sales volume, market share, growth, employment and productivity, in relation to the macroeconomic indicators assessed by the Commission (see, to that effect, judgment of 19 May 2021, China Chamber of Commerce for Import and Export of Machinery and Electronic Products and Others v Commission, T‑254/18, EU:T:2021:278, paragraph 480).
104    In the present case, it is apparent from recital 174 of the contested regulation that, following the general disclosure document, the applicant argued that it had not been provided with its own detailed data in Annex 3b to the general disclosure document, and that the magnitude of the ranges for confidential data was inadequate. In that recital of the contested regulation, the Commission stated that it had acknowledged the comments from the applicant, who had then received its own confidential data and that the ranges had been narrowed. It is stated in that recital that those changes were included in the additional sensitive disclosure provided to the applicant and to the Union industry on 8 February 2022. In recital 175 of the contested regulation, it is stated that the applicant also claimed that information at PCN-specific level should be disclosed, but that, in line with Article 19 of the basic regulation, the Commission could not reveal the requested data per product type. Indeed, in the case at hand, there were only two Union producers and three PCNs. Therefore, a disclosure of such a level of detail would make it possible either to reconstruct directly or with the addition of market intelligence, confidential sales or production data of individual Union producers. Since the applicant reiterated its argument following the additional final disclosure, the Commission responded, as indicated in recital 176 of the contested regulation, that it could not disclose detailed data accumulated from two companies only, as that created the risk that other interested parties might reconstruct confidential data of individual producers with the help of market intelligence. That is an objective risk existing in any market where there are only a few known producers active on the market or involved in the Commission’s investigation. The Commission therefore rejected that claim.
105    It is apparent from those recitals of the contested regulation that, in the disclosure communicated to the applicant, the latter received a table detailing the price undercutting (Annex 3b to the general disclosure document). After the applicant’s comments were received, as indicated in recital 174 of the contested regulation and as is apparent from Annex A.14 to the application, an updated table containing additional information was provided to the applicant. In that table, entitled ‘Detailed undercutting and injury calculations’ and containing three PCNs, the data on the Union industry and the price undercutting calculations were removed and ranges were provided on target price, total undercutting, hypothetical sales figures for sampled Union producers and total price undercutting. The applicant then requested to be provided with additional information, claiming that Annex 3b to the general disclosure document, as revised by the Commission, did not provide information on quantities considered for sampled Union producers or information on undercutting calculations at the relevant PCN-specific level. The Commission refused to provide that additional information, as indicated in recitals 175 and 176 of the contested regulation.
106    The Court notes that, given that, in the present case, only two Union producers were sampled and only three PCNs were used, the Commission had to be particularly careful to avoid disclosing information that would enable the applicant to infer commercially sensitive information therefrom.
107    As is apparent from paragraph 103 above, data of sampled Union producers are, in the present case, confidential by nature within the meaning of Article 19(1) of the basic regulation, since, as indicated in that provision, third parties’ knowledge of those matters could, in the conduct of business, be of significant competitive advantage to a competitor or have a significantly adverse effect on the person who supplied the information.
108    Moreover, given that, in the present case, the two Union producers had provided their microeconomic indicators, the Commission had to be particularly careful to ensure that producers are not able to gain access to the data of their competitors. Moreover, the limited number of PCNs significantly increased the risk that the commercially sensitive information – even if shared in ranges for the three PCNs – might be reverse engineered by the market participants.
109    In addition, the applicant has not explained how the ranges relating to quantities sold and unit sales prices were imperative for it to be able to ensure its defence. In that regard, its argument to the effect that it was necessary for it to be able to determine the representativeness of the Commission’s undercutting calculations, given the nature of the SAP market, is vague and insufficiently substantiated.
110    In the light of the foregoing considerations, the applicant has failed to demonstrate that the essential facts and considerations forming the basis of the price undercutting calculation were not communicated to it, and that the limitations on information that was provided to it in that regard were such as to undermine the fair balance between its rights of defence and the Commission’s obligation to preserve the confidentiality of the commercially sensitive information gathered in the course of the investigation. Consequently, it has not been established that the Commission infringed the applicant’s rights of defence.
111    Consequently, the second part of the first plea must be rejected as unfounded.
4.      Third part of the first plea: manifest errors of assessment and infringement of Article 3(3) of the basic regulation due to allegations of price depression or price suppression resulting from Korean imports
112    In support of the third part of the first plea, the applicant submits, in essence, that, in order to establish the existence of price depression or price suppression resulting from Korean imports, in recital 249 of the contested regulation, the Commission could not simply rely on parallel price trends or on the increase in the volume of imports, but had to establish a linkage establishing that the imports in question had explanatory force for the emergence of those trends. In that part of the plea, it puts forward three complaints.
113    In the first complaint, the applicant alleges, in essence, that the contested regulation does not establish in what way Korean imports have explanatory force for the decline in Union producers’ prices. According to the applicant, the basic regulation and its and BASF’s comments on the Commission’s questionnaire ‘accepted’ that SAP prices are based on the evolution of raw materials. The applicant claims that it has demonstrated that SAP prices have followed the evolution of the raw material component. It argues that the Commission has failed to explain how Korean imports exerted pressure on the fixed element of the calculation formula included in the SAP sales contracts because that element increased or decreased regardless of the evolution of Korean imports. In its submission, the Union producers’ prices instead followed the same trend as the raw material component and the opposite trend to that of the fixed element. It also argues that there was no correlation between the evolution of Union producers’ prices and that of the fixed element between 2019 and the investigation period.
114    In the second complaint, the applicant argues that SAP prices increased from August 2020 to the end of 2021, at the same time as raw material prices increased. The information gathered after the investigation period confirmed that prices on the Union market had not been influenced by the level of Korean imports, but by fluctuations in raw material prices. The contested regulation, however, failed to take that information into account because that information concerned a period subsequent to the investigation period. Moreover, according to the applicant, the Commission has not explained in what way prices had increased on account of supply shortages caused by an international container shortage, in so far as that event took place in December 2021 and, therefore, could not explain either the price increase which started in August 2020 or the steep price increases implemented by two Union producers in July and August 2021.
115    In the third complaint, the applicant submits that SAP are not a commodity product. As a result, negotiations are based not on their price but on their quality in relation to their specific uses according to customers’ requirements, a point confirmed by users of the product during the administrative procedure. Yet the Commission alleges in the contested regulation that the same SAP types could be offered by various suppliers and users could select the most cost-efficient sourcing, without being prevented from choosing the cheapest supplier due to technical or quality issues. According to the applicant, the information provided by users should not have been disregarded on the ground that only two users responded to the questionnaire and that those responses were considered deficient by the Commission.
116    It should be borne in mind, first of all, that Article 3(1), (2) and (3) of the basic regulation does not lay down any particular method for determining the effect of the dumped imports on prices of like products of the Union industry (see judgment of 14 September 2022, Zhejiang Jndia Pipeline Industry v Commission, T‑744/19, EU:T:2022:558, paragraph 57 and the case-law cited).
117    Moreover, price undercutting must be regarded as an economically complex issue in respect of which the Commission enjoys a broad discretion (see, by analogy, judgment of 12 May 2022, Commission v Hansol Paper, C‑260/20 P, EU:C:2022:370, paragraph 99).
118    In the present case, in recital 249 of the contested regulation, which forms part of the Commission’s conclusions on the existence of injury, the Commission observed that ‘on the basis of the trends contained in tables 2, 3, 5 and 7, … the dumped imports suppressed the prices of the Union industry. Indeed, the Union industry was unable to raise prices to the same extent as its costs of production’.
119    In the analysis of the findings on price depression or undercutting contained in the contested regulation, it is appropriate to examine, first of all, the formula on which SAP prices are based in order to determine whether there are other valid elements, other than Korean imports, which have explanatory force for that undercutting and depression.
(a)    The formula for calculating SAP prices
120    According to the Commission, in recital 283 of the contested regulation, it is a global standard that SAP sales contracts are concluded for a year or multiple years. In those contracts, the SAP price for a specific month is regularly linked to the price of the main raw materials in the preceding quarter. That delayed influence of the raw material price causes a lower or higher profit margin in the month in question.
121    The abovementioned raw materials are propylene and caustic soda.
122    It is common ground that the typical SAP price formula provides for a quarterly adjustment of prices based on the evolution of propylene and caustic soda prices. The final price consists of a fixed component, to which a variable component linked to raw material prices is added.
123    The fixed component of the price includes, inter alia, the cost of labour, overhead costs (for example, depreciation and electricity), sales costs, and other types of administrative expenses as well as the producer’s margin. The fixed component of the price is set during the negotiations of the annual or multi-annual SAP contracts and remains fixed throughout the life of the contract.
124    The variable component of the price is linked to quarterly variations in prices of raw materials. Every quarter, the total SAP price is amended based on the fluctuations in the variable component in the previous quarter.
(b)    Whether there were manifest errors of assessment
125    In the first place, the applicant submits that the contested regulation does not establish in what way Korean imports, and not the SAP price formula, have explanatory force for the decline in Union producers’ prices and therefore the injury caused to the Union industry. It claims that, during the administrative procedure, it demonstrated that prices of imports originating in the Republic of Korea, just like the prices applied by the sampled Union producers on the internal market and the export market, had followed exactly the same trend as the raw material component, that is to say, increases in 2018 followed by a drop at the beginning of 2019, which accelerated in 2020. The applicant submits that the Commission failed to explain in the contested regulation how Korean imports exerted pressure on the fixed element of the calculation formula because the latter increased or decreased irrespective of the evolution of Korean imports.
126    It should be noted that section 5.2.2 of the contested regulation, entitled ‘Price formula in raw material supply contracts’, contains an analysis of the effect of the price calculation formula on the profitability of the Union industry. In recitals 280 to 282 of the contested regulation, the Commission set out the applicant’s and users’ arguments relating to the price calculation formula, including the part relating to raw material prices adopted in the supply contracts. In that regard, in recital 283 of the contested regulation, the Commission found that the overall negative effect of fluctuations in raw material prices for the investigation period was so minimal that it could explain only a very minor part of the losses incurred by the Union industry. It accordingly concluded that that factor had not contributed to the observed injury to the Union industry.
127    Moreover, it is apparent from recitals 284 and 287 of the contested regulation that the applicant put forward, in essence, the same arguments during the administrative procedure as in its written pleadings submitted to the Court.
128    In that regard, it should be noted that the Commission examined and rejected those arguments in recitals 285, 286 and 288 of the contested regulation. In particular, in recitals 285 and 286 of the contested regulation, the Commission found that the SAP price formulas ensured that the profits of SAP producers in existing sales contracts made for a certain period were not affected by increasing raw material prices. It therefore stated that, if the price calculation formulas were the only explanatory force for the downward trend in prices, it should have resulted in a more stable profit margin for the European producers and only caused a minor price effect, because prices were linked to raw material prices of the previous quarter. It stated, however, that those price formulas could not alone be responsible for price trends in renegotiations or newly negotiated contracts, compared to existing older contracts. The Commission therefore analysed the pricing variations that occurred over the period considered in addition to the price trends linked to raw material prices. Over the period considered, the Union industry prices decreased more than the raw material prices. According to the Commission, it was that additional decrease in sales prices that caused the injury, as it was not profit-neutral. Moreover, the fact that prices of Korean imports and prices of the Union industry followed similar trends, although at different rates, does not contradict the fact that, on top of the profit-neutral trend caused by the raw material prices, there was an overlaying trend. The Commission therefore rejected, in the contested regulation, the argument that it had disregarded a factor with explanatory force for the price depression.
129    Moreover, in recital 288 of the contested regulation, the Commission explicitly rejected the applicant’s argument that the decline in domestic prices did not result from a decline in the fixed element in the SAP sales contracts, but rather from the variable element reflecting the price changes of the raw materials. In that regard, the Commission found that the price calculation formulas connected the sales price exactly for the purpose of maintaining a stable profit level and keeping changes in raw materials remained neutral regarding the profit margin. Therefore, the changes in the fixed amount of the price calculation formula with regard to new contracts or renegotiations are the element that affects the profitability of the Union industry. According to the Commission, if only the changes caused by raw material prices had occurred, then the profitability level over the period considered would have been more stable. That demonstrates that the pricing pressure of the Korean imports on the negotiations of the price element of the contract is the cause of the decline in profitability and not the changes in raw material prices. According to the Commission, the fact that pricing pressure also occurs in parallel on export markets does not contradict the analysis conducted with respect to the Union market.
130    Accordingly the applicant’s arguments set out in paragraph 125 above must be rejected.
131    In any event, it should be noted that the applicant’s arguments fail to take account of certain relevant facts. First, it maintains that the applicant fails to take account of the fact that the unit cost of production includes costs other than those of raw materials and, as a result, the costs of Union producers could increase despite a fall in the prices of the raw materials concerned. In that regard, the contested regulation, in Tables 7 and 8, illustrates the fact that both the unit cost of production of the Union industry and the average labour costs per employee increased in 2018, remained high in 2019 and were above 2017 levels during the investigation period.
132    Moreover, those types of costs (cost of labour, overhead costs, sales costs and other types of administrative expenses), which form part of the fixed price element, are precisely what is negotiated in contracts between producers and their customers, since the fixed component is the only component of the final SAP price that can be reduced, with the result that those types of costs have an impact on the profitability of the Union industry.
133    In the light of the foregoing considerations, the Commission did not make a manifest error of assessment in finding, in recital 288 of the contested regulation, that the pricing pressure of the Korean imports on the negotiations of the price element of the contract was the cause of the decline in profitability of the Union industry and not the changes in raw material prices.
134    In the second place, the applicant argues that, according to the information gathered, the increases in SAP prices after the investigation period (throughout 2021) confirm that prices on the Union market were not influenced by the level of Korean imports, but followed fluctuations in the prices of raw materials, which also increased in 2021. It thus criticises the Commission for having infringed Article 6(1) of the basic regulation by refusing to take that fact into account because it occurred after the investigation period.
135    In that regard, it should be borne in mind that Article 6(1) of the basic regulation provides, inter alia, that information relating to a period subsequent to the investigation period should, normally, not be taken into account.
136    According to the case-law, fixing an investigation period and precluding consideration of factors arising subsequently are intended to ensure that the results of the investigation are representative and reliable. The investigation period under Article 6(1) of the basic regulation is intended to ensure, in particular, that the factors on which the determination of dumping and injury is based are not influenced by the conduct of the producers concerned after the anti-dumping proceeding has been initiated and, accordingly, that the definitive duty imposed as a result of the proceeding is appropriate to remedy effectively the injury caused by the dumping (see judgment of 25 October 2011, Transnational Company ‘Kazchrome’ and ENRC Marketing v Council and Commission, T‑192/08, EU:T:2011:619, paragraph 223 and the case-law cited).
137    Moreover, by using the term ‘normally’, Article 6(1) of the basic regulation does allow exceptions to the rule against taking account of information relating to a period subsequent to the investigation period. As regards circumstances favourable to the undertakings concerned by the investigation, it has been held that the EU institutions cannot be required to incorporate in their calculations factors relating to a period subsequent to the investigation period unless such factors disclose new facts which make the proposed anti-dumping duty manifestly inappropriate. If, on the other hand, factors relating to a period subsequent to the investigation period justify, because they reflect the current conduct of the undertakings concerned, the imposition or increase of an anti-dumping duty, it is clear, on the basis of the foregoing, that the institutions are entitled, indeed obliged, to take account of them (see judgment of 25 January 2017, Rusal Armenal v Council, T‑512/09 RENV, EU:T:2017:26, paragraph 130 and the case-law cited).
138    In the present case, it should be noted that the factors behind the increases in SAP prices since the end of the investigation period were examined by the Commission in recitals 257 and 258 of the contested regulation, which refer to responses and evidence provided by users. In their view, the increase in prices after the investigation period was due to the increase in transport costs linked to the situation caused by the COVID-19 pandemic. After observing that those allegations related to a period subsequent to the period considered and did not contribute to the analysis of that period, the Commission found that there was nothing confirming that that was a long-term change in the prices and accordingly did not find that that aspect could alter its conclusions with respect to the injury found during the investigation period.
139    Moreover, the applicant’s argument, to the effect that the specialised press at the time had stated that at least two Union producers, Evonik and NSE, had implemented steep price increases for SAP after the investigation period, was examined and rejected by the Commission in recital 266 of the contested regulation, on the ground that those articles referred to a period after the period considered and therefore did not contribute to the analysis of that period. In that recital, the Commission added that such price increases could be connected to multiple short-term factors, including supply shortages caused by the international container shortage.
140    In that regard, it should be noted that the applicant does not dispute, in a specific and sufficiently substantiated manner, the above reasons put forward by the Commission in support of its decision not to take into account the alleged fact subsequent to the investigation period. It merely states that the Commission’s argument, to the effect that prices increased on account of supply shortages caused by an international container shortage, is not supported by the record. Nor does the applicant put forward any specific argument or evidence establishing that the considerations set out in recital 266 of the contested regulation are vitiated by a manifest error of assessment. According to the case-law referred to in paragraphs 41 and 137 above, it is for the applicant to demonstrate that the Commission was required to take account of the fact in question.
141    In the light of the foregoing, the Court finds that the applicant has failed to substantiate the alleged infringement of Article 6(1) of the basic regulation.
142    In the third place, the applicant argues, in essence, that the analysis of price effects carried out in the contested regulation is invalidated by the fact that SAP are sold and negotiated on the basis of quality and not price.
143    In that regard, in recital 279 of the contested regulation, the Commission noted that SAP producers were normally able to produce a wide range of grades for specific applications, and that both Union and Korean producers produced such spec-in products. That is also reflected by the fact that many users, especially large users, apply a multi-sourcing strategy. That demonstrates that, in principle, there is not only one SAP producer with a specific grade that best satisfies the customers’ requirements, but various. Logically, then, users, as profit-oriented companies, will balance the advantages of the features of a certain type of SAP offered by several suppliers against the most cost-efficient sourcing. That is different from a situation where users are restricted from choosing the cheapest supplier due to quality or technical issues. The Commission therefore rejected the argument that negotiations would not be based on prices, but solely on quality.
144    Moreover, the applicant’s argument on that point is based, in essence, on explanations provided by a coalition of users during the administrative procedure, who stated, inter alia, that ‘[prices] are negotiated only if the testing and selection process can be successfully completed, that is to say if the product satisfies all the qualitative criteria set forth by the diaper manufacturer. Quality is thus the first and foremost criteria when selecting a SAP supplier, way before price considerations’. Contrary to the applicant’s assertions, there is nothing in those explanations to suggest that sales negotiations were based on SAP quality and not price. Consequently, the Court concludes that the applicant has failed to put forward any evidence establishing that the considerations set out in recital 279 of the contested regulation are vitiated by a manifest error of assessment.
145    That conclusion cannot be called into question by the applicant’s argument, to the effect that the Commission failed to take account of the views of users because they did not respond to the questionnaire during the administrative procedure. In fact, the Commission expressly took account of users’ arguments in its analysis, by stating, in recital 279 of the contested regulation, that ‘many users, especially large users, apply a multi-sourcing strategy’.
146    Consequently, the third part of the first plea must be rejected as unfounded, as must, therefore, the first plea in its entirety.
B.      Second plea: manifest errors of assessment, infringement of Article 3(2), 3(5), 3(6) and 3(7) of the basic regulation, and failure to state reasons by analysing the injury situation of Union producers in a biased manner and by attributing the alleged injury to Korean imports, rather than to other known factors
147    The applicant puts forward three parts in support of its second plea. The first part alleges manifest errors of interpretation and infringement of Article 3(2) and (5) of the basic regulation on the ground that the injury situation of Union producers was analysed in a partial and incomplete manner. The second part alleges manifest errors of assessment and infringement of Article 3(6) of the basic regulation inasmuch as the Commission attributed injurious effects to imports from the Republic of Korea. The third part alleges manifest errors of assessment and infringement of Article 3(7) of the basic regulation inasmuch as the Commission failed to identify and to take into account other known factors of injury.
148    The Commission, supported by the interveners, disputes the applicant’s arguments.
1.      Preliminary remarks
149    In the second plea, the applicant alleges infringement of Article 3(2), (5), (6) and (7) of the basic regulation.
150    According to Article 3(2) of the basic regulation:
‘A determination of injury shall be based on positive evidence and shall involve an objective examination of:
(a)      the volume of the dumped imports and the effect of the dumped imports on prices in the Union market for like products; and
(b)      the consequent impact of those imports on the Union industry.’
151    Article 3(5) of the basic regulation provides as follows:
‘The examination of the impact of the dumped imports on the Union industry concerned shall include an evaluation of all relevant economic factors and indices having a bearing on the state of the industry, including the fact that an industry is still in the process of recovering from the effects of past dumping or subsidisation; the magnitude of the actual margin of dumping; actual and potential decline in sales, profits, output, market share, productivity, return on investments and utilisation of capacity; factors affecting Union prices; actual and potential negative effects on cash flow, inventories, employment, wages, growth, ability to raise capital or investments. This list is not exhaustive, nor can any one or more of these factors necessarily give decisive guidance.’
152    According to Article 3(6) of the basic regulation:
‘It must be demonstrated, from all the relevant evidence presented in relation to paragraph 2, that the dumped imports are causing injury within the meaning of this Regulation. Specifically, that shall entail demonstrating that the volume and/or price levels identified pursuant to paragraph 3 are responsible for an impact on the Union industry as provided for in paragraph 5, and that that impact exists to a degree which enables it to be classified as material.’
153    Article 3(7) of the basic regulation provides as follows:
‘Known factors, other than the dumped imports, which at the same time are injuring the Union industry shall also be examined to ensure that the injury caused by those other factors is not attributed to the dumped imports under paragraph 6. Factors which may be considered in that respect shall include: the volume and prices of imports not sold at dumping prices; contraction in demand or changes in the patterns of consumption; restrictive trade practices of, and competition between, third country and Union producers; developments in technology and the export performance; and productivity of the Union industry.’
154    According to settled case-law, the objective examination regarding the determination of injury caused to the Union industry, provided for in Article 3(2) of the basic regulation, must relate, first, to the volume of the dumped imports and the effect of the dumped imports on prices in the Union market for like products, and, second, to the consequent impact of those imports on the Union industry. Thus, as regards the determination of that volume or those prices, Article 3(3) of the basic regulation sets out the factors to be taken into account in that examination, while specifying that one or more of those factors cannot in themselves give decisive guidance. The same is true with respect to the impact of the dumped imports on the Union industry. It follows from Article 3(5) of the basic regulation that the EU institutions have the task of evaluating all relevant economic factors and indices which have a bearing on the state of that industry, and one or more of those factors does not necessarily give decisive guidance. That provision thus gives those institutions discretion in the examination and evaluation of the various items of evidence (see judgment of 10 July 2019, Caviro Distillerie and Others v Commission, C‑345/18 P, not published, EU:C:2019:589, paragraphs 19 to 21 and the case-law cited).
155    Thus, Article 3(5) of the basic regulation provides that the Commission must carry out an overall evaluation weighing up all relevant economic factors and indices having a bearing on the state of the Union industry (see, to that effect, judgment of 10 July 2019, Caviro Distillerie and Others v Commission, C‑345/18 P, not published, EU:C:2019:589, paragraph 46).
156    With respect to the causal link, under Article 3(6) of the basic regulation, the EU institutions must demonstrate that the volume and/or price levels identified pursuant to Article 3(3) are responsible for an impact on the Union industry as provided for in Article 3(5) and that that impact exists to a degree which enables it to be classified as material (see judgment of 10 July 2019, Caviro Distillerie and Others v Commission, C‑345/18 P, not published, EU:C:2019:589, paragraph 22 and the case-law cited). That entails what is known as the ‘attribution analysis’.
157    In addition, first, it should be noted that, while the examination by the institutions must lead to the conclusion that the injury caused to the Union industry is material, it is not required that all relevant economic factors and indices show a negative trend. Secondly, the mere fact that certain injury factors have improved during the period considered does not necessarily mean that the Union industry is not suffering material injury (see judgments of 23 April 2018, Shanxi Taigang Stainless Steel v Commission, T‑675/15, not published, EU:T:2018:209, paragraph 93 and the case-law cited, and of 22 September 2021, Severstal v Commission, T‑753/16, not published, EU:T:2021:612, paragraph 175 and the case-law cited).
158    It also follows from Article 3(7) of the basic regulation that the institutions must examine all other known factors which are injuring the Union industry at the same time as the dumped imports and, in addition, ensure that the injury caused by those other factors is not attributed to the dumped imports. That entails what is known as the ‘non-attribution analysis’ (judgment of 6 September 2013, Godrej Industries and VVF v Council, T‑6/12, EU:T:2013:408, paragraph 62).
159    The objective of Article 3(6) and (7) of the basic regulation is therefore to ensure that the Union institutions separate and distinguish the injurious effects of the dumped imports from those caused by other factors. If the institutions do not separate and distinguish the impact of the various injury factors, they cannot legitimately conclude that the dumped imports have caused injury to the Union industry (judgment of 6 September 2013, Godrej Industries and VVF v Council, T‑6/12, EU:T:2013:408, paragraph 63).
160    Thus, known factors other than the dumped imports which at the same time are injuring the EU industry must be examined in order to ensure that injury caused by those other factors is not attributed to the dumped imports under Article 3(6) (judgment of 27 March 2019, Canadian Solar Emea and Others v Council, C‑236/17 P, EU:C:2019:258, paragraph 164).
161    To that end, it is for the EU institutions to ascertain whether the effects of those other factors were not such as to break the causal link between, on the one hand, the imports in question and, on the other, the injury suffered by the Union industry. It is also for them to verify that the injury attributable to those other factors is not taken into account in the determination of injury within the meaning of Article 3(7) of the basic regulation and, consequently, that the anti-dumping duty imposed does not go beyond what is necessary to offset the injury caused by the dumped imports. That requirement is based on the aim of the rules referred to in Article 3(6) and (7) of the basic regulation, according to which the Union industry cannot be granted protection beyond that which is necessary to counter the injurious effects of the dumped imports (see judgment of 27 March 2019, Canadian Solar Emea and Others v Council, C‑236/17 P, EU:C:2019:258, paragraphs 166 and 167 and the case-law cited).
162    However, if the institutions find that, despite such factors, the injury caused by the dumped imports is material, the causal link between those imports and the injury suffered by the Union industry can consequently be established (see judgment of 22 September 2021, Severstal v Commission, T‑753/16, not published, EU:T:2021:612, paragraph 206 and the case-law cited).
163    It should also be borne in mind that, according to settled case-law, the EU institutions may attribute responsibility for injury to the dumped imports, even if their effects are only a part of wider injury attributable to other factors. The fact that an EU producer is facing difficulties, whether or not attributable in part to causes other than dumping, is not a reason for depriving that producer of all protection against the injury caused by the dumped imports. That is why it is possible to impose anti-dumping duties, even if they leave intact problems posed for the EU industry by other factors (see judgment of 28 February 2017, Canadian Solar Emea and Others v Council, T‑162/14, not published, EU:T:2017:124, paragraph 184 and the case-law cited).
164    Lastly, as regards the allegation concerning the reversal of the burden of proof, it should be noted that the institutions are indeed obliged to consider whether the injury they intend to rely on for the adoption of the anti-dumping measure in fact derives from the dumped imports and to put aside any harm deriving from other factors. However, it is for the parties pleading the illegality of an anti-dumping regulation to adduce evidence to show that the factors other than those relating to the imports could have had such an impact that they called into question the causal link between the injury suffered by the Union industry and the dumped imports (see judgment of 27 March 2019, Canadian Solar Emea and Others v Council, C‑236/17 P, EU:C:2019:258, paragraph 178 and the case-law cited).
165    It is in the light of those considerations that the second plea must be examined.
2.      First part of the second plea: manifest errors of assessment and infringement of Article 3(2) and (5) of the basic regulation due to partial and incomplete analysis of the injury situation of Union producers
166    In support of the first part of the second plea, the applicant argues that Article 3(2) of the basic regulation requires an objective examination concerning, inter alia, the impact of imports on the Union industry. However, in the present case, the conclusion set out in the contested regulation, concerning the negative trend, as regards the evolution of production, capacity utilisation, sales, market share, average prices and profitability, is partial, incomplete and fails to reflect the actual evolution of the Union industry; it is therefore not the result of an objective examination of the situation of the industry in question. The applicant puts forward, in essence, three complaints.
167    Accordingly, in the first complaint, the applicant argues that, as regards volume, the deterioration of the injury indicators took place solely between 2019 and the investigation period. In that regard, it submits that, over the period from 2017 to 2019, production and capacity increased, that, over the period from 2017 to 2018, sales and market share also increased and that, over the period from 2018 to 2019, sales remained stable. Accordingly, as regards volume, no material injury can be found prior to the investigation period, which is recognised, but eluded, in the relevant conclusions of the contested regulation.
168    In the second complaint, the applicant criticises the Commission for not taking into account all the factors affecting Union prices, but dealing only with their evolution, infringing Article 3(5) of the basic regulation. As regards the analysis of Union producers’ prices, costs and profitability, the applicant submits that the contested regulation is partial as regards the conclusions to the effect that the evolution of costs could be explained by a sudden increase in raw material prices in 2018 which did not decrease until the investigation period. In fact, according to the applicant, costs only followed raw material prices between 2017 and 2018 and the evolution of costs was linked to investments made by Union producers, most of which were made in 2018. Given the size of those investments and the corresponding reduction in capacity utilisation, the additional fixed costs, such as overheads and depreciation, were necessarily allocated to the product concerned. Accordingly, the applicant argues that the evolution of costs was no longer linked to the evolution of raw material prices, due to significant depreciations which pushed up the manufacturing overheads. That is why, in the applicant’s view, the Commission should have examined the impact of those investments on the injury suffered by the Union industry. The contested regulation wrongly links the evolution of costs to the evolution of raw material prices and fails to take account of the fact that the evolution of SAP prices is itself linked to that of raw material prices. Thus, the disconnection between the average sales price and unit cost of the Union producers is the result of increased costs due to investments in a context of declining prices, on account of the typical SAP price formula, and led to a drop in profitability, which should be factored in as part of the injury analysis.
169    In the third complaint in this part of the plea, the applicant submits that Article 3(5) of the basic regulation did not preclude the analysis of the export performance of the Union industry as part of the injury analysis, since the list set out in that article is not exhaustive and all the factors having a bearing on the situation should be assessed. In the present case, in that context, the export performance of the Union industry should have been examined since the SAP market is global in nature. Thus, according to the applicant, an examination of export sales leads to the conclusion that sales were redirected from the EU market to export markets, resulting in a significant increase in exports by the Union industry. It argues that export sales by Union producers alone offset the lower sales of the entire Union industry on the domestic market. It also argues that prices collapsed in 2018, in parallel with raw material prices, and that the profitability of Union producers was either similar or better on the domestic market than on the export market.
170    The applicant concludes that the analysis in the contested regulation of injury indicators relating to volumes, prices, costs and profitability is not objective, is partial and is based on manifest errors of assessment, infringing Article 3(2) of the basic regulation. That incomplete analysis concerning the factors affecting the prices and export performance of the Union industry also infringes Article 3(5) of that regulation.
171    In the present case, the Court notes that the injury assessment carried out by the Commission is contained in sections 4 and 5 of the contested regulation. For the purpose of analysing the injury, the Commission examined the economic situation of the Union industry on the basis of an evaluation of each of the relevant factors referred to in Article 3(5) of the basic regulation, which it broke down into a series of ‘macroeconomic’ factors and a series of ‘microeconomic’ factors, and found, in recital 248 of the contested regulation, that ‘all main injury indicators showed a negative trend during the period considered’, referring to trends in production, capacity utilisation, sales, market share, average prices and profitability.
172    According to the applicant, the Commission carried out a partial and incorrect analysis of the injury indicators relating to volumes, prices, costs and profitability, and an incomplete analysis of factors affecting prices and export performance of the Union industry.
173    It is appropriate to examine the applicant’s complaints one by one.
(a)    The analysis of volumes in the contested regulation
174    The Court finds, first of all, that, in the separate subsections of section 4 of the contested regulation, the Commission took account of all the factors listed in Article 3(5) of the basic regulation. Moreover, the Court notes that, in its analysis of each injury indicator, the Commission did actually take into account changes in indicators during the period considered and not only the situation of those indicators during the investigation period.
175    In that regard, it must be recalled that, according to the case-law, the idea which underlies setting a ‘period under consideration’ is to enable the Commission to examine a period longer than that covered by the investigation proper, so as to base its analysis on actual or potential trends, which, in order to be capable of being identified, require a sufficiently long period of time (see judgments of 19 May 2021, China Chamber of Commerce for Import and Export of Machinery and Electronic Products and Others v Commission, T‑254/18, EU:T:2021:278, paragraph 337 and the case-law cited, and of 14 December 2022, PT Wilmar Bioenergi Indonesia and Others v Commission, T‑111/20, EU:T:2022:809, paragraph 232 and the case-law cited).
176    As regards the analysis of volumes, the applicant submits, in essence, that the contested regulation is vitiated by manifest errors of assessment in so far as it fails to take account of the fact that no material injury was found before the investigation period.
177    Moreover, in recitals 204 and 205 of the contested regulation, the Commission found that the Union industry production volume increased by five percentage points between 2017 and 2019, before decreasing by seven percentage points between 2019 and the investigation period. The overall production volume decreased over the period considered by 2%. It added, moreover, that the production capacity had increased steadily during the period considered, passing from ‘540 000 – 580 000’ tonnes in 2017 to ‘650 000 – 690 000’ tonnes in 2019 and stayed at that level over the investigation period, for an overall increase of 17%. According to the Commission, the capacity increase of the Union SAP industry resulted from a major investment made by one Union producer during the period considered. On that basis, referring to the data in Table 4 of the contested regulation, the Commission found, in recital 206 of that regulation, that while the Union production capacity had increased significantly during the period considered, the Union capacity utilisation had deteriorated significantly, passing from a capacity utilisation of ‘93%-95%’ in 2017 to ‘78%-80%’ during the investigation period. That trend resulted in a total decrease of 17% in Union capacity utilisation during the period considered.
178    Those findings by the Commission concerning capacity utilisation have not been disputed in a specific and substantiated manner by the applicant in its written pleadings.
179    Moreover, recitals 215 and 216 of the contested regulation state as follows:
‘(215) Total sales in the Union market overall decreased over the period considered, recording [an] 11% fall between 2017 and the IP. Between 2017 and 2018 the total volume of sales to the Union increased by 4%, and then steadily dropped until the [investigation period, ‘IP’]. The most significant drop was registered between 2019 and the IP, when the total sales volume on the Union market decreased by 14%.
(216) Despite the stable Union consumption as shown in Table 1, the Union industry sales volume decreased steadily during the period considered and, thus, the market share consequently dropped by 12% between 2017 and the IP. Similarly for the trend of Union sales volume, the most significant drop in market share was registered between 2019 and the IP with a year-on-year decrease of 15%.’
180    Those findings by the Commission concerning capacity utilisation are also not disputed in a specific and substantiated manner by the applicant in its written pleadings.
181    Hence, although it is common ground that there were changes in Union industry production volume over the period considered, it is not disputed by the applicant that a significant decline was found between 2019 and the investigation period and that, accordingly, there was a deterioration in an important injury indicator during the investigation period, which is relevant for the determination of whether there was injury caused to the Union industry.
182    The Court accordingly finds that the applicant has failed to establish a manifest error of assessment on the part of the Commission, with the result that the present complaint must be rejected.
(b)    The analysis of prices, costs and profitability in the contested regulation
183    As regards the analysis of prices, costs and profitability of Union producers, the applicant submits, in essence, that, in the contested regulation, the Commission merely found that sampled Union producers’ sales prices had been partly adapted to reflect changes in production costs and that costs had followed raw material prices, without taking account of the fact that cost trends were, in reality, linked to investments made by Union producers. According to the applicant, substantial investments made by BASF and NSE in 2017 and 2018 had a significant impact on the injury suffered by the Union industry, which the Commission failed to take into account.
184    It should be noted that the existence of those investments was expressly examined in recital 205 of the contested regulation, that is to say, before the analysis of microeconomic indicators such as prices and costs. The following is stated in that recital:
‘The production capacity increased steadily during the period considered, passing from [540 000 – 580 000] tonnes in 2017 to [650 000 – 690 000 tonnes] in 2019 and stayed at that level in the investigation period, for an overall increase of 17%. The capacity increase of the EU SAP industry resulted from a major investment made by one Union producer during the period considered.’
185    Moreover, the evolution in investments and return on investments is illustrated in Table 10 of the contested regulation, indicating that in 2018 investments of EUR ‘300 000 000 – 400 000 000’ were made and that the relevant index went from 100 in 2017 to 1 749 in 2018.
186    Moreover, contrary to the applicant’s assertions, the effect of those investments on the injury was also analysed in detail in recitals 324 to 327 of the contested regulation under the title ‘Injury caused by costs of capacity increases’. In that regard, the Commission observed the following in recital 326 of that regulation:
‘… it is a part of the normal course of business that SAP manufacturers invest into new production facilities, especially in a situation of close to full capacity utilisation, which was a given in the beginning of the period considered. The capacity increases were also not of an unreasonable dimension, especially taking into account production efficiencies connected to a higher capacity. In addition, the Commission requested the sampled Union producers to exclude any extraordinary effect from impairments or extraordinary write-off from the injury indicators.’
187    In the light of those considerations, in recital 327 of the contested regulation, the Commission rejected the argument that the cost of capacity increases contributed to the injury.
188    Nor has the applicant established that the considerations referred to in recital 326 of the contested regulation, to the effect that those investments (which led to capacity increases) were not unreasonable, are vitiated by a manifest error of assessment. In fact, those considerations are corroborated by the market conditions and, more specifically, by the fact that, prior to the increase, at the start of the period considered, capacity utilisation was almost 100%, as illustrated by the data presented in Table 4 of the contested regulation (which utilisation totalled ‘93%-95%’ in 2017) and by the fact that, by way of comparison, in 2019 the applicant itself had increased its own production capacity by 120 000 tonnes, to bring it to a total of 490 000 tonnes. Hence, the Commission’s finding to the effect that, in essence, the new production facilities were part of the normal course of business, is not incorrect.
189    Moreover, in recital 326 of the contested regulation, the Commission expressly states that the extraordinary effects from impairments or write-offs were excluded from the injury indicators, including the cost of production of the Union producers.
190    Accordingly, the applicant has failed to establish in a sufficiently substantiated manner that the Union industry had suffered losses because it had been unable to recover its investment costs. That argument is further contradicted by the profitability figures from Evonik which, as is apparent from the information in the file, did not make significant capacity investments during the period considered, but also stated that it had incurred continuous losses throughout the injury investigation period. In fact, Evonik’s profitability figures follow the same trend as the profitability figures of the sampled Union producers who made the abovementioned investments.
191    Therefore, the applicant’s argument to the effect that the Commission should have examined sufficiently the impact of those investments on the injury suffered by the Union industry must be rejected.
192    Lastly, the applicant’s argument relating to the allegedly incorrect analysis by the Commission in the contested regulation in so far as concerns the correlation between trends in SAP prices and trends in raw material prices was addressed and rejected in paragraphs 120 to 132 above in the discussion of the third part of the first plea.
193    In the light of the foregoing considerations, it has not been established that the conclusion in recital 327 of the contested regulation is vitiated by a manifest error of assessment, with the result that the present complaint must be rejected.
(c)    Analysis of the export performance of the Union industry in the contested regulation
194    According to the applicant, the export performance should be taken into consideration in the Commission’s analysis under Article 3(5) of the basic regulation. That performance ought to have been examined due to the global nature of the SAP market. Thus, an examination of export sales would have led to the conclusion that sales had been redirected from the Union market to export markets, resulting in a significant increase in exports by the Union industry. Moreover, prices collapsed in 2018, in parallel with raw material prices. Moreover, the profitability of the sampled Union producers on the domestic market was either similar to or better than profitability on the export markets.
195    It should be borne in mind that the Commission found as follows in recitals 217 and 218 of the contested regulation:
‘(217) Following the final disclosure [the applicant] argued that the Commission cannot analyse the evolution of sales volumes on the Union market in isolation from sales on exports markets. Sales have been re-directed from the Union market to export markets rather than being “lost”.
(218) The Commission necessarily must analyse the development on the Union market in order to determine an injury on the Union market. The increase in exports has been analysed in the section 5.2.4 to determine, if this was a cause for the injury incurred. The Commission therefore rejected the argument that it had analysed the evolution in isolation disregarding the exports of the Union industry.’
196    In that regard, the Court finds, as did the Commission, that the export performance is not expressly referred to in Article 3(5) of the basic regulation as a relevant factor or economic indicator of the Union industry to be assessed in the examination of the effect of dumped imports on the Union industry.
197    Moreover, Article 3(7) of the basic regulation provides explicitly that export performance is a factor that may be considered relevant for the examination of known factors other than dumped imports which are at the same time causing injury to the Union industry.
198    Hence, the question whether export performance is relevant for that analysis comes within the Commission’s discretion in carrying out the abovementioned examination. Export performance can, therefore, be examined together with other known factors which might at the same time cause injury to the Union industry as provided for in Article 3(7) of the basic regulation.
199    As regards the applicant’s argument to the effect that sales have been re-directed from the Union market to export markets rather than being ‘lost’, the Court notes that the Commission assessed that point in recitals 319 and 320 of the contested regulation as follows:
‘(319) Following the final disclosure [the applicant] argued that sales on the Union market were not lost for the Union industry, but rather re-directed [from] the Union market to export markets. In addition [the applicant] argued that in a 2007 investigation concerning pentaerythritol, the Commission held that a slight increase in export volumes at sales prices lower than the average sales prices on the Union market had a negative effect on the financial situation of the Union industry.
(320) The Commission observed that the capacity utilisation of the Union industry during the IP was only [78%-80%]. This confirms that the Union industry could have increased the exports sales also without selling less on the Union market. …the increased export sales thus did not contribute significantly to the material injury.’
200    It is clear that those findings have not been disputed in a specific and substantiated manner by the applicant in its written pleadings.
201    As regards the applicant’s argument to the effect that, in terms of prices, the same trends were observed on the internal market and on export markets, the Court notes that the Commission assessed that point in recitals 315 and 316 of the contested regulation as follows:
‘(315) The average price of [sampled Union producers’ exports] first increased by 23% in 2018. That level then decreased in 2019, remaining 18% higher than the 2017 level, and further in the investigation period to a level that was below the 2017 level (-2%). The average price of those exports was lower than that of the Union industry in the Union market throughout the period considered, and remained stable. Export volumes were consistently below the volume levels that the Union industry achieved in the Union market, even though they increased by 45% overall during the period considered.
(316) The export sales prices developed more closely in line with the raw material price evolution over the period considered, thus not showing the same magnitude of price depression over the period considered, as the sales on the Union market (shown in Table 5). In addition, given that export sales increased, they did not have any additional negative effects on the fixed costs per unit produced. Thus, the Commission concluded that the export performance did not contribute significantly to the material injury suffered by the Union industry.’
202    It is apparent from those recitals that the Commission did take the volumes and prices of those exports into account and examined whether the export performance had contributed significantly to the material injury suffered by the Union industry. The Court further finds that the applicant’s arguments in that regard are not sufficiently specific and substantiated to demonstrate that the Commission’s conclusion, to the effect that the export performance had not contributed significantly to the material injury suffered by the Union industry, is vitiated by a manifest error of assessment. The present complaint must therefore be rejected.
203    Consequently, the first part of the second plea must be rejected as unfounded.
3.      Second part of the second plea: manifest errors of assessment and infringement of Article 3(6) of the basic regulation due to the attribution of injurious effects to imports from the Republic of Korea
204    The applicant puts forward three complaints in support of the second part of the second plea. In particular, the applicant submits, in essence, that, in order to establish the existence of a causal link between the imports in question and the alleged injury, the contested regulation should not rely on temporal correlations and endpoint-to-endpoint comparisons of the periods concerned. The applicant argues that correlation is not causation and an endpoint-to-endpoint comparison of the period in question is inadequate.
205    By its first complaint, the applicant submits that the Commission made an error of assessment in concluding in the contested regulation that Korean imports had gained market share to the detriment of the Union industry, by relying solely on a comparison of volumes in 2017 and during the investigation period. According to the applicant, Korean imports never increased to the detriment of Union producers because that increase between 2017 and 2018 did not prevent the Union industry from increasing its market share, despite stable consumption, and nor did it result in lower sales by Union producers between 2018 and 2019. Moreover, between 2019 and the investigation period, Korean imports and their market share declined while Union producers’ sales and market share decreased. Thus, the Union producers lost a very minimal part of their market share to Korean imports. According to the applicant, the contested regulation does not recognise the absence of correlation between the evolution in the market share of Korean exports and the evolution of the Union industry market share, whereas those conclusions are linked to the analysis of other known injury factors. Thus, the applicant argues that Korean imports could never have been a cause of the injury allegedly suffered by Union producers in terms of volume, irrespective of what might have caused the alleged injury.
206    In its second complaint, the applicant argues that the claims that the prices of Korean imports were lower than the prices of the Union producers during the period considered were based on an irrelevant statistical comparison of the average prices of imports from the Republic of Korea with the average prices of the Union producers, for the reasons set out in the second complaint in the first part of its first plea. According to the applicant, given the significant differences in grades and therefore corresponding prices between SAP products, a simple comparison of prices in respect of baskets with different compositions does not indicate the effect of one set of prices on the other set of prices. The applicant also observes that, in support of the third part of its first plea, it has already refuted the alleged links between the prices of Korean imports and the prices of the Union producers.
207    In its third complaint, the applicant submits that recital 333 of the contested regulation presents a ‘narrative’, created by the Commission, concerning the injury situation which is incorrect because, in particular, the contested regulation does not take into account intervening trends relating to volume and price. According to the applicant, first, the situation did not deteriorate significantly in 2019, since, during that year, production and capacity increased, sales and market shares remained stable and profitability improved. The situation deteriorated in 2020, in parallel with a decline in Korean imports. Secondly, Korean prices did not fall sharply in 2019, while the Union industry maintained its price levels at the expense of Union sales volumes, because the Republic of Korea had considerably expanded its sales. The Union lost only a very minimal part of its market share to Korean imports. However, the alleged injury caused to Japanese imports does not justify the imposition of anti-dumping measures. Thirdly, the Union industry did not follow the price trend set by the Republic of Korea, did not decrease its sales prices in 2020 and did not continue to lose significant sales volumes in the market. On the one hand, the Union industry had decreased its sales prices much more than those of imports from the Republic of Korea and, on the other hand, those imports also decreased in 2020. Korean imports were therefore not the source of the loss of EU sales. Fourthly, according to the applicant, Korean imports have not caused material injury to the Union industry since 2017 on account of their massive market penetration, at the expense of the Union industry, because that analysis is incorrectly superficial and based on the end points of the relevant period. Fifthly, the prices of Korean imports were not consistently below the Union industry’s prices and did not exert strong pricing pressure or prevent market prices from increasing at the same rate as increases in raw material costs. Nevertheless, fluctuations in raw material prices were reflected in the prices of Korean imports and in the prices of Union producers. The applicant therefore submits that the Commission committed manifest errors of assessment infringing Article 3(6) of the basic regulation.
208    In the present part, it is appropriate to recall the principles under which, in the first place, the Commission must carry out an overall evaluation weighing up all relevant economic factors and indices having a bearing on the state of the EU industry (see paragraph 155 above) and, in the second place, it is not required that all relevant economic factors and indices show a negative trend (see paragraph 157 above).
209    As regards the applicant’s first complaint, it should be borne in mind, first of all, that, under section 5.1 of the contested regulation, entitled ‘Effects of the dumped imports’, the Commission found as follows in recitals 260 to 264 of that regulation:
‘(260) The volume of imports from the Republic of Korea increased (as shown in Table 2) by 33% from 2017 to the investigation period and, consequently, their market share increased by 33%, i.e. from [12%-14%] to [16%-18%]. This was at the detriment of the Union industry. Indeed, over the same period (as shown in Table 5), the Union industry sales decreased by 11% and its market share in the Union market decreased by 12%. In particular, the market share of the Union industry fell from [56%-58%] in 2017 to [49%-51%] in the IP.
(261) The prices of the dumped imports decreased by 10% over the period considered (as shown in Table 3). In parallel, the Union industry prices in the Union market fell by 15% over the same period. The South Korean imports, ever more present in the Union market throughout the period considered, were made at prices that continuously lower than those of the Union industry.
(262) The pressure exerted by the dumped imports also caused significant price suppression as evidenced by the fact that the Union industry was unable to raise prices at the same rate as costs. Indeed, as shown in Table 7, over the period considered, the costs of production increased by 5% whereas the Union industry’s sales prices decreased by 15%. During the period considered, that inability to increase prices caused the profitability of the Union industry to significantly fall from [-2% – -7%] to [-15% -20%], which is clearly an unsustainable level.
(263) In parallel, imports from the Republic of Korea significantly increased in volume by 33% and their market share increased by 33%, while the market share of the Union industry dropped by 12%. Indeed, despite a stable Union market consumption between 2017 and the IP, South Korean imports continued to gain market share from the Union industry. In the same period, South Korean import prices decreased by 10% (Table 3), while the Union industry prices decreased more, by 15%, contrary to the cost of production, that increased by 5%. Therefore, already by 2018, the Union industry was suffering from material injury caused by the dumped imports.
(264) On the basis of the above, the Commission concluded that the imports from the Republic of Korea caused material injury to the Union industry. Such injury had both volume and price effects.’
210    The Court finds that it is apparent from those recitals, in the first place, that the volumes and market shares of Korean imports increased significantly (by 33%) between 2017 and the investigation period; in the second place, that, during that same period, Union industry sales and market share dropped (by 11% and 12%, respectively); and, in the third place, that the prices of dumped imports decreased by 10%.
211    Moreover, in its conclusions concerning causation in recital 333 of the contested regulation, the Commission stated as follows:
‘A comparison of the situation of imports with that of the Union industry at the beginning and the end of the period considered clearly shows a substantial increase of imports from the country concerned and the deterioration of the situation of the Union industry. More specifically, the situation deteriorated significantly in 2019 and 2020. South Korean prices decreased importantly in 2019 while the Union industry (and Japan) maintained their price levels. However, this was at the expense of their sales volume as the Republic of Korea considerably expanded its sales. In response, the Union industry followed the price trend set by the Republic of Korea and decreased their sales prices in 2020 but they continued to lose important sales quantities in the market. The dumped imports from the Republic of Korea caused material injury to the Union industry since 2017 because of the massive market penetration achieved at the expense of the Union industry. In terms of prices, the increasing market share of imports continuously undercut those of the Union industry and created substantial pricing pressure and prevented the market price increases in line with raw material cost increases that were necessary for the Union industry to achieve reasonable profit levels.’
212    By its first complaint (see paragraph 205 above), the applicant submits that the imports originating in the Republic of Korea never increased at the expense of Union producers and that, therefore, the Commission erred in finding that Korean imports had conquered market shares at the expense of the Union industry by basing itself solely on a comparison of the volumes in 2017 with those relating to the investigation period. According to the applicant, the Union producers lost at the very most 1% of their market share to Korean imports.
213    In that regard, it should be noted that the applicant does not dispute the Commission’s conclusions in recitals 260 to 263 of the contested regulation, to the effect that, first, during the period considered overall, the Union industry’s market shares decreased significantly, whereas the volume and markets shares of the Korean imports increased substantially during the same period and, second, imports originating from the Republic of Korea obtained prices that were consistently lower than those of the Union industry throughout the period considered.
214    The applicant’s arguments, summarised in paragraphs 205 and 212 above, are focused solely on trends found at certain times during the period considered and are aimed more at demonstrating the lack of indicator or trend liable to substantiate those findings by the Commission. However, those arguments do not establish that there was a manifest error of assessment vitiating the conclusion in recital 264 of the contested regulation, to the effect that the imports from the Republic of Korea caused material injury to the Union industry, entailing both volume and price effects. In fact, they are focused on specific elements relating to the evolution of volumes and market shares which are not, in themselves, decisive within the meaning of Article 3(5) of the basic regulation or capable of refuting the abovementioned conclusions of the Commission relating to the entire period considered.
215    Moreover, the applicant’s principal argument, to the effect that there is no correlation between the evolution in market share of the Korean exports and the evolution of the Union industry’s market share, inter alia because the latter lost most of its market shares in 2020, a year in which imports originating in the Republic of Korea decreased in volume and market share, is not capable of establishing a manifest error of assessment, for the following reasons. In the first place, the applicant relies on arguments alleging specific indicators relating to successive individual periods, whereas, as observed in paragraphs 155 and 175 above, the assessment of injury must be based on an overall assessment of the entire period considered, which the Commission did in section 5 of the contested regulation, in recitals 259 to 337. In the second place, there was a slight drop in the volume of Korean imports in 2020, whereas the drop in the Union industry’s sales volume was greater. In the third place, between 2018 and 2019, the Union industry’s market share decreased slightly, whereas the market share of the Korean imports increased considerably. In the fourth place, as rightly observed by the Commission in recital 269 of the contested regulation, that argument of the applicant is closely linked to its other allegation, to the effect that Japanese, and not Korean, imports were responsible for the loss of market shares in 2020. That allegation is unrelated to the attribution analysis, however, and will be examined at the stage of the analysis on non-attribution (see paragraphs 241 to 264 below). Lastly, that argument of the applicant disregards the fact that SAP contracts are generally negotiated regularly for at least a year, including as multi-year contracts, and the price negotiations regularly take place in the year preceding the start of the contract, as rightly observed by the Commission in recitals 302 to 304 of the contested regulation, a point not disputed by the applicant. Accordingly, the present complaint of the applicant must be rejected.
216    As regards the applicant’s second complaint (see paragraph 206 above), it is clear that, in order to substantiate its line of argument, the applicant refers to arguments put forward previously in both the second complaint in the first part of its first plea and the third part of its first plea. Those arguments were considered and rejected in the examination of that plea above. Accordingly, the present complaint of the applicant must also be rejected.
217    As regards the applicant’s third complaint (see paragraph 207 above), the Court notes, in the first place, that the applicant isolates a single recital of the contested regulation (recital 333), which summarises only part of the Commission’s conclusions on causation. In the second place, as regards the applicant’s argument that the injury situation did not deteriorate significantly in 2019 and 2020, the Court notes that, as is apparent from Tables 4 and 10 of the contested regulation, the Union capacity utilisation decreased and profitability dropped slightly, which shows a notable deterioration in the Union industry situation during that period. In the third place, the applicant’s argument relating to Japanese imports are not relevant at the attribution analysis stage, as already noted in paragraph 215 above. In the fourth place, as regards the applicant’s arguments to the effect that the Union industry lost at most 1% of its market shares to imports originating in the Republic of Korea in 2019 and that it reduced its prices much more sharply than those of Korean imports, apart from the fact that the applicant focuses on a single year, it should be recalled that, in recitals 260 to 264 of the contested regulation, referring inter alia to the data in Tables 2, 3 and 7 of the contested regulation, the Commission analysed fluctuations in volumes and prices of Korean imports for the entire period considered before going on to conclude that those imports caused material injury to the Union industry. Moreover, the applicant’s argument relating to fluctuations in raw material prices was examined and rejected in the discussion of the first plea above.
218    In any event, it is clear that, by its arguments, the applicant has failed to adduce evidence establishing that there has been a manifest error of assessment in the Commission’s analysis set out in recital 333 of the contested regulation, but rather proposes an alternative interpretation of the trend in economic indicators by stating that the Commission’s approach seems to it to be artificial. However, given the Commission’s broad discretion in that regard, an applicant must establish that there has been a manifest error of assessment in that field, which the applicant has failed to do in the present case (see, to that effect, judgment of 19 May 2021, China Chamber of Commerce for Import and Export of Machinery and Electronic Products and Others v Commission, T‑254/18, EU:T:2021:278, paragraphs 340 to 341 and the case-law cited).
219    Consequently, the second part of the second plea must be rejected as unfounded.
4.      Third part of the second plea: manifest errors of assessment and infringement of Article 3(7) of the basic regulation due to failure to identify and take into account other known factors of injury
220    In support of the third part of the second plea, the applicant submits that the contested regulation does not properly examine a series of known factors which, in its view, explain the alleged injury incurred by Union producers and relies on biased arguments to reject their relevance. In that context, the applicant puts forward three complaints.
221    First, the applicant refers to the impact of the SAP price formula coupled with the short-term impact of significant investments. In that regard, it argues that, since it is not disputed that SAP prices follow those of raw materials, nor that raw material prices have declined since 2018, it should not be disputed that prices have declined in the European Union as a result of the SAP price formula and not as a result of Korean imports. The applicant argues that, at the same time, Union producers made massive investments to develop new capacities or new products generating start-up costs and depreciation which are extraordinary in nature and drove up its costs. According to the applicant, those investments were behind a disconnect between the cost structure of Union producers and the SAP price formula. Thus, despite a drop in raw materials causing a drop in SAP prices, costs remained high. Union producers were therefore unable to pass on in full the excessive costs related to their investments. The applicant submits that, in the contested regulation, the Commission acknowledges that at least part of the decline in sales prices results from the SAP price formula, but it attributes the entire decline in sales prices to Korean imports without drawing any distinction. The applicant argues that the fixed element of the Union producers’ price fluctuated and increased in 2019, when the volume of Korean imports peaked, proving that that element evolved independently of the fixed element of Korean imports. There was thus no pressure from Korean imports which forced Union producers to implement price decreases on top of those already linked to the SAP price formula or to reduce the fixed element of their price. Therefore, according to the applicant, the Commission failed to analyse properly the impact of the SAP price formula and of the significant investments made by the sampled Union producers, in particular NSE, and failed to consider those two factors collectively.
222    Secondly, the applicant puts forward four arguments relating to imports from third countries and, more specifically, from Türkiye and Japan. In the first place, the applicant submits that Korean imports captured a very minimal market share from Union producers between 2018 and 2019. The market shares lost by the Union producers were therefore lost to imports from Japan and Türkiye. In the second place, the applicant argues that, if the falls in market prices were attributable to imports and not to the SAP price formula, then two factors should be considered. The first concerns the prices of imports from Türkiye between 2017 and 2020, which were lower than those of Korean imports. The second concerns the time when imports from Japan increased substantially, that is to say between 2019 and the investigation period, and relates to the prices of those imports being below the prices of Korean imports. The applicant claims, therefore, that undercutting, price suppression or depression also applies to imports from Türkiye and Japan. In the third place, the applicant submits that there is no valid justification for considering that massive imports from Japan, at prices below those of Korean imports, have not caused injury to the Union industry. In the fourth place, the applicant maintains that, since, in the contested regulation, the Commission acknowledges that Turkish imports are a contributing factor to the injury suffered by the Union industry, the Commission should ensure that the injurious effects of those Turkish imports are separately identified and not attributed to Korean imports. In that context, the applicant submits that the Commission committed manifest errors of assessment and infringed Article 3(7) of the basic regulation in refusing to acknowledge and to take into account the injury caused by Japanese and Turkish imports, which was wrongfully attributed to Korean imports.
223    Thirdly, the applicant puts forward complaints relating to NSE’s predatory strategy regarding Japanese imports. The applicant argues that it has provided extensive evidence of that predatory strategy implemented by NSE, in particular inasmuch as NSE aggressively increased its capacities and increased its sales at the expense of Union producers. Moreover, NSE decided in 2020 to support the sales of its EU mills with significant Japanese imports at prices below those of Korean imports and those of the Union industry. Consequently, according to the applicant, the Commission committed manifest errors of assessment and infringed Article 3(7) of the basic regulation by failing to examine whether, and to what extent, NSE’s predatory strategy had contributed to the injury suffered by the Union industry. The Commission also failed to fulfil its obligation to state reasons by not addressing the comments made by the applicant in that regard.
224    In the present case, in section 5.2 of the contested regulation, the Commission examined the known factors other than dumped imports which could at the same time cause injury to the Union industry. Those factors included, inter alia, the price formula in raw material supply contracts and imports from third countries, including Türkiye and Japan.
225    Following that examination, the Commission concluded, first, that the price formula had not contributed to the injury to the Union industry and, second, that imports from Türkiye and Japan had not attenuated the causal link between the dumped imports and the significant injury caused to the Union industry.
226    It is appropriate to examine in turn the applicant’s complaints directed at the abovementioned conclusions of the Commission.
(a)    Impact of the SAP price formula and impact of investments
227    The applicant submits, in essence, that, in the contested regulation, the Commission failed to take account of the impact of the SAP price formula and the investments made by the Union producers. The applicant claims that the combination of the price decreases caused by the SAP price formula and those investments was the cause of the material injury suffered by the Union industry.
228    The SAP price formula is analysed in paragraphs 120 to 124 above.
229    Moreover, the applicant’s arguments concerning the impact of the SAP price formula and the Commission’s analysis of that aspect contained in recitals 285 to 288 of the contested regulation have already been examined in paragraphs 125 to 133 above. In that regard, it has been demonstrated that, contrary to the applicant’s assertions, price levels are also significantly affected by the fixed price formula component, which is the only final SAP price component that is negotiated by contract and can therefore be reduced. It has also been found that, in the contested regulation, the Commission had taken into account the fact that changes in raw materials influenced the sales price.
230    In the light of the foregoing, the Court rejects the complaint to the effect that the Commission disregarded the impact of the SAP price formula, which had to be considered a factor in price depression and in the injury caused to the Union industry. Hence, the complaint that the combination of the price decreases caused by the SAP price formula and the investments made by the Union producers caused the material injury suffered by the Union industry must also be rejected.
231    The Court further finds that the second part of that complaint, relating to the impact of the investments made by the sampled Union producers (including NSE and BASF) on Union industry costs, must also be rejected as unfounded, for the reasons set out in paragraphs 184 to 191 above.
232    Therefore, the present complaint, to the effect that the Commission failed to take account of the impact of the SAP price formula and the investments made by the Union producers, or of their combined effects, must be rejected in its entirety.
(b)    Imports from Türkiye
233    As regards imports from Türkiye, the Court notes, first of all, that their volumes, market shares and average prices during the period considered are illustrated in Table 11 of the contested regulation.
234    As regards the injury caused by the Turkish imports, the Commission states the following in recitals 296 and 297 of the contested regulation:
‘(296) Imports from [Türkiye] increased by 25% over the period considered. Their market share increased from [6%-8%] to [7%-9%] in that period. The average price of those imports followed the same trend of those from the Republic of Korea, despite being set at a lower level as of 2018 until the IP. During the investigation period, they undercut South Korean and the Union industry prices by 3% and 14% respectively. Turkish imports should therefore be considered as a contributing factor to the injury suffered by the Union industry.
(297) However, as the volume of such imports represented always less than half of those from the Republic of Korea, it is clear that imports from the Republic of Korea were a more important causation factor.’
235    Next, in its conclusions on causation, the Commission stated as follows in recital 335 of the contested regulation:
‘Imports from Japan and [Türkiye] in turn had a limited impact on the industry. Imports from [Türkiye] were at similar prices to the South Korean imports but at much lower volumes and thus such imports did not attenuate the causal link between the dumped imports and the injury of the Union industry Similarly, Japanese imports did not attenuate the causal link between the dumped imports and the injury of the Union industry.’
236    It is apparent from those recitals that, first, the Commission expressly considered the imports from Türkiye to be an ‘other known factor’ that contributed to the injury suffered by the Union industry within the meaning of Article 3(7) of the basic regulation and that, second, that factor could not attenuate the causal link found by the Commission between that injury and the Korean imports, since those Korean imports were ‘a more important causation factor’, given that the volume of imports from Türkiye represented always less than half of those from the Republic of Korea.
237    In that context, the applicant submits that, between 2018 and 2019, the 1% decline in market share of Union producers was more likely attributable to Turkish imports than to Korean imports, since Turkish imports had entered the Union market at prices below those of Korean imports; It adds that, throughout the period from 2017 to the investigation period, imports from Türkiye were priced below imports from Korea. It accordingly concludes that any allegation of undercutting, price suppression or depression also concerns imports from Türkiye and that the alleged injury caused by Turkish imports was significantly higher than that allegedly caused by the Korean imports, with the result that the causal link between those imports and the injury was broken.
238    The Court notes, in that regard, that the applicant does not dispute the Commission’s finding that, during the period considered, the volume of imports from Türkiye represented almost half of those from the Republic of Korea (more specifically, according to Tables 2 and 11 of the contested regulation, between 2017 and 2020, the former increased from 43 571 to 54 537 tonnes and the latter from 83 499 to 110 903 tonnes). Rather, it argues that the injury caused by Turkish imports was significantly higher than that allegedly caused by the Korean imports, since the prices of the former were lower than those of the latter during the period considered. However, that difference is less than 10%, as is apparent from Tables 2 and 11 of the contested regulation.
239    Given the minor price differences between imports from Korea and those from Türkiye and, by contrast, the very marked difference in volumes for those two types of imports, the applicant’s arguments do not establish that the Commission made a manifest error of assessment in finding that imports from Türkiye were a less significant causation factor than imports from the Republic of Korea and that, as a result, imports from Türkiye did not attenuate the causal link between imports from Korea and the injury suffered by the Union industry.
240    Consequently, the applicant’s argument must be rejected as unfounded.
(c)    Imports from Japan and NSE’s alleged predatory strategy
241    In the present complaint, the applicant argues, in essence, that all of the market shares lost by the Union producers went to imports from third countries, principally Japan. In its submission, the Commission is incorrect in refusing, in the contested regulation, to acknowledge the impact of Japanese imports based on allegations that have no basis in the record of the investigation.
242    Moreover, although the applicant puts forward a separate complaint concerning NSE’s allegedly predatory strategy, arguing, inter alia, that it provided ample substantiated evidence of the predatory strategy implemented by NSE, which enabled it to increase its sales at the expense of other Union producers, the Court notes that that complaint essentially relates to the applicant’s arguments concerning the effect of imports from Japan. It is therefore appropriate to examine those two complaints together.
243    In the present case, the contested regulation addresses the topic of imports from third countries in recitals 289 to 312. In that regard, Table 11 of that regulation shows imports from third countries, including Japan, and indicates more specifically their volumes, market shares and average prices during the period considered. The question of the injury caused specifically by imports from Japan is addressed inter alia in recitals 290 to 295 and 301 to 310 of the contested regulation.
244    In particular, as regards imports from Japan, the Commission found as follows in recitals 290 to 295 of the contested regulation:
‘(290) While imports from Japan have first decreased by 28% between 2017 and 2018 and by 25% between 2018 and 2019, they substantially increased by 75% in the IP. The imports from Japan were carried out by one of the sampled Union producers, Nippon Shokubai Europe, which in addition to its own production resells SAP produced by its mother company Nippon Shokubai Japan (“Nippon Shokubai”). Until 2019, Nippon Shokubai followed a strategy of decreasing Japanese imports in favour of its European production, which is reflected in higher production volume and investments, resulting in a significant European capacity increase in 2018. However, over time, Nippon Shokubai Europe was confronted more and more by customers demanding lower prices due to the pressure of low-priced South Korean imports. Therefore, as of the IP, Nippon Shokubai adapted its strategy.
(291) In order to remain competitive with the South Korean imports and not to lose sales volumes in Europe, Nippon Shokubai Europe increased its resales of SAP produced in Japan.
(292) While prices of Japanese and South Korean imports overall followed a largely similar trend (like those of the Union industry), there is one notable exception: South Korean import prices showed a significant drop in 2019 while Japanese prices still increased and Union industry prices remained nearly stable. This was not sustainable and as a consequence, both the Japanese and Union industry had to follow and drop their prices significantly in the IP.
(293) The development of market shares is also significant. The Republic of Korea increased its market share by 4 percentage points over the entire period considered. By contrast, Japanese imports first decreased significantly in the years 2018 and 2019 and only increased in the IP as a consequence of the pricing pressure from the South Korean imports, which rendered the European production unprofitable. As result, the quantities imported from Japan during the IP were higher than those imported at the beginning of the injury investigation period, and the market share held by Japan increased by 20% over the whole injury period.
(294) There is no evidence on file to suggest that Japanese imports were dumped. As a consequence, regardless of whether or not imports from Japan may have contributed to the injury of other Union producers, the effect of the South Korean exports was substantially higher over the period considered due to the lower price and higher volume increase throughout that period.
(295) In addition, Nippon Shokubai Europe also continued to suffer losses on the sales of its SAP produced in Europe.’
245    Moreover, in recitals 299 to 308 of the contested regulation, the Commission responded to the arguments put forward by the applicant during the administrative procedure concerning its assessment of Japanese imports.
246    In that regard, the following is stated in the relevant passages of the contested regulation:
‘(301) [The applicant] also claimed that injury was mainly caused by Japanese imports. In support of its claim, [the applicant] stated that at their peak in 2019, the Korean imports did not prevent the Union industry from increasing the fixed element of their price. The fixed element only declined in 2020, when Korean imports declined but the prices of the Union industry declined more to follow the decline in prices of imports from Japan.
(302) [The applicant’s] argument only points to an isolated comparison of the years 2019 and 2020. This, however, disregards the fact that SAP contracts are negotiated regularly for at least a year, but also as multi-year contracts and the price negotiations regularly take place in the year preceding the start of the contract. This means that prices for contracts starting [in] 2020 were negotiated in 2019 and multi-year contracts starting in 2019 were already negotiated in 2018.
(303) However, imports from Japan had decreased in 2018 by 28% and in 2019 even by 57% compared to 2017. Also, in 2019 the volume imported from Japan even at the upper end of the range displayed in Table 11 does not even constitute half of the imports from Korea in the same period. From a comparison of the imports from Japan displayed in recital (113) of the complaint for the period from July 2019 to June 2020, [63 000 – 67 000 tonnes] with the imports for the entire year 2020 displayed in Table 11, [105 000 – 115 000 tonnes], it is further visible that the increase in Japanese imports mostly took place only as of the second half of 2020.
(304) It is therefore, highly unlikely that the increase in Japanese imports in 2020 had an effect on the price negotiations for the sales in 2020, but rather logical that the additional effect of the 2020 Japanese imports, if any, will only [materialise] from 2021 onwards. Contrary to that, as [the applicant] admits, Korean imports increased substantially in 2018 and with an increase of 38% reached its peak in 2019, the two years in which most price negotiations for 2020 took place. The fact that the Japanese imports only substantially increased in the second half of 2020 shows that these imports are a reaction to the pricing pressure exercised by the Korean [imports as] highlighted in recital (291) above. The Commission therefore rejected the argument that the increase in imports from Japan taking place in 2020 is [a] causal factor of the price depression in 2020 on the Union market.
(305) [The applicant] further argued that the prices of the sampled Union producers followed prices of imports from Japan and not from Korea.
(306) [The applicant] did not demonstrate a correlation of the Union producers’ prices with the Japanese import prices. Between 2017 and 2018, Union producer prices and prices of imports from Korea increased by a similar percentage, whereas Japanese import prices only increased marginally. Between 2018 and 2019 prices of imports from Japan clearly increased by 4 percentage points, whereas the Union producers’ prices declined, as did the Korean import prices. Only from 2019 to the IP is there a clear correlation, which indicates that both Union producers and Japanese imports were under the pricing pressure of the record Korean imports in 2019.
(307) [The applicant] also argued that NSE did not adapt its strategy as they maintained stable Union sales in the IP, on top of significant imports from Japan. Furthermore, according to [the applicant], suppliers cannot be switched overnight due to a lengthy on-boarding process of users. NSE implemented a long-term predatory strategy to supply the Union market both from Japanese and Union factories, by increasing capacities in the Union and sales to the detriment of other Union producers.
(308) The Commission noted that imports from Japan, including the imports of NSE, have decreased substantially from 2017 to 2019 and only increased in the IP. This demonstrates that a strategy adaptation took place, aiming to replace resales of Japanese imports by local production in the EU. Only in reaction to the competition from low-priced Korean imports, did Japanese imports increase at the end of 2020. Such adaptations can take place more quickly between subsidiaries of a multinational group[,] with shorter adaptation time required on the user’s side. This also aligns with the fact that imports from Japan decreased while production capacities in the Union were increased. The Commission therefore rejected the claim.’
247    Lastly, in recital 335 of the contested regulation, the Commission explained that imports from Japan had had only a limited impact on the Union industry. In that regard, it stated as follows in that recital:
‘… Japanese imports did not attenuate the causal link between the dumped imports and the injury of the Union industry. Such imports decreased during the period considered and only substantially increased in the IP. However, imports from Japan maintained a higher price level than the South Korean imports. The South Korean imports at prices much lower than those of the Union industry are the main reason why the Union industry lost sales and could not raise its prices in line with its cost of production, which led to severe profitability losses.’
248    At the hearing, the Commission stated that, although the wording used in the last sentence of recital 304 of the contested regulation may be ambiguous, it had acknowledged that imports from Japan were a factor that had contributed to the injury suffered by the Union industry but that, as was apparent from recital 335 of the contested regulation, it had found that those imports had a limited impact on the Union industry and that, accordingly, they were not such as to attenuate the causal link between the dumped imports and the injury suffered by the Union industry.
249    In its complaint concerning Japanese imports, the applicant puts forward certain arguments on the basis of which it asserts, in paragraph 106 of the application, that ‘there is no valid justification to consider that massive imports from Japan, at prices below those of Korean imports, would not have caused injury to the Union industry as a whole’. However, that allegation is based on an incorrect reading of the contested regulation, in which, as is apparent from the considerations set out in paragraph 248 above, the Commission did not find that Japanese imports had not caused injury to the Union industry, but rather that that injury was limited, with the result that those imports are not capable of attenuating the causal link.
250    Hence, in that context, and in accordance with the case-law referred to in paragraphs 156 to 164 above, it is appropriate to examine whether the arguments put forward by the applicant establish to the requisite legal standard that that factor, that is to say, imports from Japan, contrary to what the Commission found in the contested regulation, were able to be of such significance as to call into question the causal link between the injury suffered by the Union industry and the dumped imports.
251    In particular, in the first place, the applicant argues that, between 2019 and the investigation period, there was a sharp increase in Japanese imports at prices lower than those of Korean imports. In the second place, it argues that the drop in Union producers’ prices between 2019 and the investigation period was significant and similar to the drop in prices of Japanese imports, whereas the drop in prices of imports from the Republic of Korea was more limited. In the third place, the applicant submits that, in recital 293 of the contested regulation, the Commission should not describe the development of Korean market shares as ‘significant’ since Korean imports increased their market share by 4% over the entire period considered, whilst noting that the market share of Japanese imports increased only during the investigation period. According to the applicant, NSE’s sales remained stable, which means that Japanese imports captured substantial market shares, primarily at the expense of all other Union producers. In the fourth place, the applicant challenges the Commission’s position, as set out in recitals 290, 291 and 308 of the contested regulation, that imports from Japan would have been made for self-defence purposes by NSE, which had no choice but to import and re-sell Japanese SAP, as a response to the pressure of low-priced Korean imports.
252    Those arguments are not such as to establish a manifest error of assessment by the Commission.
253    In the first place, the Court finds that the applicant’s arguments fail to take account of all of the factors and considerations set out in recitals 302 to 308 of the contested regulation, in which the Commission examined and rejected the applicant’s complaint on that point. They focus more specifically on two economic indicators, volume and price, over specific years and periods, and not on the evolution of those indicators over the course of the entire period considered. The applicant’s argument does not include an overall assessment of all the relevant factors examined by the Commission, including that concerning delayed effects of contract negotiation on prices (see recital 302 of the contested regulation).
254    In particular, the applicant’s arguments disregard factors including the fact that, in 2019, the year preceding the investigation period, imports from Japan had decreased considerably and did not equal even half of the Korean imports in 2019 (see Tables 2 and 11 and recital 303 of the contested regulation) and, furthermore, Korean imports increased substantially as their prices underwent a sharp decrease, whereas the Union industry had maintained a higher price level at the expense of its sales volumes.
255    In essence, the applicant merely proposed an alternative interpretation of the evolution of those economic indicators, without however substantiating that interpretation with specific data or evidence. The applicant failed to adduce specific evidence establishing that most of the market shares lost by Union producers went to imports from Japan and not the Republic of Korea, as it alleges.
256    Moreover, as regards the applicant’s argument that the Commission should not have described the evolution of the market shares of imports from the Republic of Korea as ‘significant’ because those imports increased their market share by 4% over the entire period considered, the Court notes that, given that the market share of those imports never exceeded 18% at any time during the period considered, an increase of 4% in that market share could correctly be described as significant.
257    Hence, it has not been demonstrated that the Commission made a manifest error of assessment in finding that, prior to the investigation period, Korean imports, and not Japanese imports, exercised considerable pressure on the Union industry and that, consequently, Japanese imports were not capable of attenuating the causal link between the dumped imports and the material injury suffered by the Union industry.
258    In the second place, as regards the applicant’s argument disputing the Commission’s findings as set out in recitals 290, 291 and 308 of the contested regulation, that imports from Japan would have been made for self-defence purposes by NSE, which had no choice but to import and re-sell Japanese SAP, as a response to the pressure of low-priced Korean imports, the Court notes that those recitals refer to a ‘strategy’ by NSE which, according to the Commission, was indeed adapted so as to replace resales of Japanese imports with local production in the European Union. In particular, the Commission found that, until 2019, the parent company of NSE in Japan, Nippon Shokubai Japan, followed a strategy of decreasing Japanese imports in favour of its European production, which is reflected in higher production volume and investments, resulting in a significant European capacity increase in 2018. According to the Commission, as from the investigation period, Nippon Shokubai Japan adapted its strategy due to the pressure of low-priced South Korean imports and, in order to remain competitive with those imports and not to lose sales volumes in Europe, NSE increased its resales of SAP produced in Japan.
259    In that regard, the Court notes that although, as correctly observed by the applicant, the contested regulation does not contain anything specific to support the finding in recital 291, to the effect that NSE had to adapt its strategy so as not to lose sales volumes in Europe, the Commission stated, in response to a measure of inquiry from the Court, that Nippon Shokubai Japan’s strategy had been explained in an email from NSE received on 1 December 2021. Moreover, it states that it confirmed the underlying facts and figures proving the initial strategy and its adaptation in 2020 during the investigation period.
260    In that regard, the Court finds that, in the email of 1 December 2021, NSE explains, in essence, that, given the applicant’s commercial activities on the EU market, its rapid capture of market shares in the EU between 2017 and 2019 and the ongoing pricing pressure on sales, in 2020 it decided ‘as an act of self-defence’ to increase temporarily its imports from Japan as from that year in order to preserve market shares in the NS group instead of losing them to the applicant. In that same email, NSE further states that, given its considerable investments in the European Union, it had no reason to import large volumes of Japanese SAP other than the battle against dumped Korean imports until such time as equitable conditions were re-established on the EU market. Those explanations are supported and plausible, and they corroborate the considerations set out by the Commission in recital 308 of the contested regulation. They are also supported by information, figures and evidence, placed in the file following the abovementioned measure of instruction concerning the market structure, the quantities and types of products manufactured in Europe and Japan, then sold or resold in Europe, and requests for price reductions put forward by certain customers of NSE at the time of commercial negotiations.
261    Thus, in the light of the foregoing considerations concerning the existence of a strategy of adaptation and self-defence on the part of NSE, which led to the increase in its imports from Japan, the applicant’s argument concerning an allegedly long-term predatory strategy of NSE, similar to that examined and rejected in recitals 307 and 308 of the contested regulation, cannot succeed, a fortiori because it is not supported by specific and compelling evidence.
262    Consequently, it has not been established that the Commission’s assessments set out in recitals 290, 291 and 308 of the contested regulation are vitiated by a manifest error of assessment.
263    Moreover, as regards the applicant’s argument relating to an alleged infringement of the obligation to state reasons, it should be borne in mind that, according to settled case-law and as stated in paragraph 76 above, the Commission is not required to adopt a position on all the arguments relied on before it by the parties concerned; rather, it is sufficient if it sets out the facts and legal considerations having decisive importance in the context of the decision (see judgment of 3 March 2010, Freistaat Sachsen v Commission, T‑102/07 and T‑120/07, EU:T:2010:62, paragraph 180 and the case-law cited).
264    In the light of the abovementioned factors relied on by the Commission in the contested regulation, the Court finds that it has not been established that its conclusion, set out in recital 336 of the contested regulation, to the effect that the material injury to the Union industry had been caused by the dumped imports from the Republic of Korea, while other factors, considered individually or collectively, had not attenuated the causal link between the dumped imports and the material injury, was vitiated by a manifest error of assessment.
265    Consequently, the third part of the second plea must be rejected in its entirety, as must, therefore, the second plea.
C.      Third plea: manifest errors of assessment, infringement of Article 3(3) and Article 9(4) of the basic regulation and infringement of the rights of the defence through determination of the injury margin based on a simplified PCN, failure to provide adequate non-confidential summaries of the injury margin calculations and failure to reflect other known injury factors in the injury margin determination
266    In its third plea, the applicant submits, in essence, that the injury margin established by the Commission in the contested regulation is incompatible with Article 3(3) and Article 9(4) of the basic regulation and that the Commission infringed its rights of defence. The applicant puts forward two complaints in support of that plea.
267    In the first complaint, the applicant submits that, as the Commission relied on a ‘simplified PCN’ and failed to provide adequate non-confidential summaries of figures for Union producers, its injury margin determination is vitiated by the same flaws as the undercutting calculations. The applicant refers, in that regard, to its arguments put forward in support of the first and second parts of the first plea. According to the applicant, the contested regulation establishes a direct link between the price undercutting calculation and pricing. Since, as demonstrated in the first part of the first plea, the undercutting calculation is partly incorrect, inter alia, due to an inadequate type-by-type basis comparison, the same defect vitiates the price undercutting calculation. According to the applicant, the possibility cannot be ruled out that, if the price undercutting had been calculated correctly, the injury margin of the Union industry would have been established at a level below that of the dumping margin.
268    In the second complaint, the applicant argues that, under Article 9(4) of the basic regulation, the Commission should have imposed an anti-dumping duty not exceeding what was necessary in order to counter the injurious effects of the imports in question and that that amount should therefore not take into account injurious effects caused by factors other than those imports. The applicant maintains that it has demonstrated, by the third part of the second plea, that there were other known factors of injury which the Commission should have taken into account. According to the applicant, since the Commission’s calculations of the injury margin fail to take those factors into account, it is impossible to ensure that the amount of the anti-dumping duty imposed does not also counter the injurious effects caused by factors other than imports originating from the Republic of Korea. The applicant adds that, during the administrative procedure, it had estimated conservatively the amount of injury which should have been attributed to other known factors. As regards the Commission’s argument that, by definition, the price undercutting calculation does not take account of effects due to other causes of injury, the applicant submits that it runs counter to the obligation not to attribute to the imports targeted the injurious effects due to other factors and that it is incorrect, since Korean prices are as depressed by the impact of low-priced Japanese and Turkish imports as by NSE’s predatory pricing strategy and the SAP price formula, whereas the Union industry’s costs are inflated by elevated investment costs.
269    The Commission, supported by the interveners, disputes the applicant’s arguments. The Commission submits, in essence, that the injury margin, as calculated in the contested regulation, takes account only of the difference between the applicant’s sale price and the hypothetical target price of the Union industry. In its submission, the injury margin is therefore the expression of the duty necessary to eliminate the injury arising solely from the applicant’s imports.
270    It should be borne in mind, first of all, that the second subparagraph of Article 9(4) of the basic regulation provides that ‘the amount of the anti-dumping duty shall not exceed the margin of dumping established but it should be less than the margin if such lesser duty would be adequate to remove the injury to the Union industry’ and that ‘Article 7(2a), (2b)[,] (2c) and (2d), shall apply accordingly’.
271    Under Article 7(2c) of the basic regulation, as amended by Regulation (EU) 2018/825 of the European Parliament and of the Council of 30 May 2018 (OJ 2018 L 143, p. 1):
‘When the injury margin is calculated on the basis of a target price, the target profit used shall be established taking into account factors such as the level of profitability before the increase of imports from the country under investigation, the level of profitability needed to cover full costs and investments, research and development (R&D) and innovation, and the level of profitability to be expected under normal conditions of competition. Such profit margin shall not be lower than 6%.’
272    Moreover, under Article 7(2d) of the basic regulation, as amended by Regulation 2018/825:
‘When establishing the target price, the actual cost of production of the Union industry, which results from multilateral environmental agreements, and protocols thereunder, to which the Union is a party, or from International Labour Organisation (ILO) Conventions listed in Annex Ia to this Regulation, shall be duly reflected. Moreover, future costs, which are not covered in paragraph 2c of this Article, which result from those agreements and conventions, and which the Union industry will incur during the period of the application of the measure pursuant to Article 11(2), shall be taken into account.’
273    It should be recalled, in that regard, that Article 9(4) of the basic regulation lays down the ‘lesser duty rule’, under which the amount of the anti-dumping duty must be lower than the margin of dumping established if that lesser duty is adequate to remove the injury caused to the Union industry. The objective of that rule is to prevent the anti-dumping duty imposed from going beyond what is necessary to remove the injury caused to the Union industry by the dumped imports. Such a rule is justified in the light of the nature and purposes of anti-dumping duties which are neither penalties nor compensatory measures intended to make good the actual damage caused, but protective measures against unfair competition resulting from dumped imports. Those duties seek only to prevent dumped imports or to make them economically unattractive and thereby to redress an imbalance in the domestic market caused by that dumping (see judgment of 8 June 2023, Severstal and NLMK v Commission, C‑747/21 P and C‑748/21 P, EU:C:2023:459, paragraphs 72 and 73 and the case-law cited).
274    Moreover, although Article 9(4) of the basic regulation does not contain any indication of how the anti-dumping duty is to be calculated and does not impose any particular methodology on the institutions in order to ensure that the anti-dumping duty does not exceed what is necessary to counter the injurious effects of the dumped imports of the product concerned, it should be borne in mind that those institutions are required, in that context, to take into account the conclusions they reached in the analyses carried out pursuant to Article 3(6) and (7) of that regulation (see, to that effect, judgment of 27 March 2019, Canadian Solar Emea and Others v Council, C‑236/17 P, EU:C:2019:258, paragraphs 161 and 163).
275    In order to ensure that the amount of the anti-dumping duty imposed in accordance with Article 9(4) of the basic regulation does not exceed that which is necessary to counter the injurious effects of the dumped imports, that amount should not take into account injurious effects caused by factors other than those imports. In other words, the institutions are to take into account, for the purpose of determining that amount, the conclusions reached by those institutions following the examination of the determination of injury, within the meaning of Article 3(6) and (7) of that regulation. That conclusion is, moreover, confirmed by the wording of Article 9(4) of the basic regulation, which, in its first sentence, refers to ‘dumping and [the] injury caused thereby’. Thus, the term ‘injury’ in that same paragraph must be understood in the same way, as a reference to the injury arising from dumping, that is to say to the injury caused only by the dumped imports (judgment of 27 March 2019, Canadian Solar Emea and Others v Council, C‑236/17 P, EU:C:2019:258, paragraphs 169 and 170; see, to that effect, judgment of 3 December 2020, Changmao Biochemical Engineering v Distillerie Bonollo and Others, C‑461/18 P, EU:C:2020:979, paragraph 65).
276    It should be noted, with respect to Article 7(2c) of the basic regulation, that it largely codifies the approach taken in the ‘price undercutting’ method in order to determine the ‘injury margin’ (see, to that effect, Opinion of Advocate General Emiliou in Joined Cases Severstal and NLMK v Commission, C‑747/21 P and C‑748/21 P, EU:C:2023:20, points 33 to 35 and 57).
277    Under that method, the injury margin is calculated by comparing the price of the dumped imports with a target sales price of the Union industry. That price represents the price the Union industry could reasonably expect to charge in the EU market in the absence of the dumped imports. To establish such a hypothetical price, a target profit is added to the Union industry’s production costs. That target profit corresponds to the profit margin that the Union industry could reasonably expect under normal market conditions (judgment of 8 June 2023, Severstal and NLMK v Commission, C‑747/21 P and C‑748/21 P, EU:C:2023:459, paragraph 74).
278    The Court of Justice held, in essence, that the use of that method came within the Commission’s margin of discretion. The use of a target price instead of the actual sales price of the Union industry in order to determine the injury margin makes it possible to take into account the downward pressure exerted by the dumped imports on the sales prices of the Union industry. Taking that pressure into account contributes to the plausibility of the results obtained by using that method (judgment of 8 June 2023, Severstal and NLMK v Commission, C‑747/21 P and C‑748/21 P, EU:C:2023:459, paragraph 77).
279    Lastly, Article 7(2c) of the basic regulation is applicable to procedures initiated as from 8 June 2018, with the result that it is applicable to the present case.
280    In the present case, the Commission applied Article 7(2c) of the basic regulation and calculated the injury margin on the basis of a target price.
281    In particular, the Commission stated, in section 5 of the contested regulation, that, due to their volume and prices, imports from the Republic of Korea caused material injury to the Union industry within the meaning of Article 3(6) of the basic regulation. In the assessment under Article 3(7) of the basic regulation, the Commission, whilst acknowledging that imports from Türkiye and Japan were factors that had contributed to the injury suffered by the Union industry, concluded, in essence, that those factors were not sufficiently material to attenuate the causal link.
282    In section 7 of the contested regulation, the Commission examined whether a duty lower than the dumping margin would be sufficient to eliminate the injury caused to the Union industry by the dumped imports, in accordance with Article 9(4) of the basic regulation. In recital 378 of the contested regulation, the Commission found that that would be the case if the Union industry was able to cover its costs of production and obtain a reasonable profit (in other words, a ‘target profit’) by selling at a target price within the meaning of Article 7(2c) and 7(2d) of the basic regulation.
283    In recitals 378 to 380 and 383 and 384 of the contested regulation, the Commission explained its methodology as follows:
‘(378) The Commission first established the amount of duty necessary to eliminate the injury suffered by the Union industry. In this case, the injury would be eliminated if the Union industry was able to cover its costs of production, including those costs resulting from multilateral environmental agreements, and protocols thereunder, to which the Union is a party, and of ILO Conventions listed in Annex Ia to the basic Regulation, and was able to obtain a reasonable profit (“target profit”) by selling at a target price in the sense of [Article 7(2c) and 7(2d)] of the basic regulation.
(379) In accordance with Article 7(2c) of the basic Regulation, to establish the target profit, the Commission took into account the level of profitability before the increase of imports from the country concerned and the level of profitability to be expected under normal conditions of competition. Such profit margin should not be lower than 6%.
(380) The Commission established a basic profit covering full costs under normal conditions of competition. During the entire period considered the Union industry incurred losses. As this was lower than the minimum 6% required by Article 7(2c) of the basic Regulation, that profit margin was replaced by 6%.
…
(383) On that basis, the Commission calculated a non-injurious price of the like product for the Union industry by applying the target profit margin of 6% to the cost of production of the sampled Union producers during the investigation period and then adding the adjustments under Article 7(2d) of the basic Regulation on a type-by-type basis.
(384) The Commission then determined the injury elimination level on the basis of a comparison of the weighted average import price of the sampled exporting producers in the country concerned on a type-by-type basis, as established for the price undercutting calculations, with the weighted average non-injurious price of the like product sold by the sampled Union producers on the free Union market during the investigation period. Any difference resulting from that comparison was expressed as a percentage of the weighted average import CIF [cost, insurance and freight] value.’
284    The injury elimination level (definitive injury margin) was thus determined to be 34.4% as regards the applicant (see recital 385 of the contested regulation).
285    Lastly, the Commission stated the following:
‘(386) Following the Final Disclosure [the applicant] argued that the injury margin determination is affected by the same error as the undercutting calculations, and their considerations made for the undercutting apply mutatis mutandis. Also the injury margin should be adjusted by the impact of the other factors put forward by [the applicant].
(387) The Commission referred to its arguments in recitals (184) to (188) as well as its rebuttal of [the applicant’s] arguments on the impact of imports from other countries, the SAP price formula and the investments of the Union industry, set forth in the respective sections of the causation analysis. Those claims were thus rejected also with regard to the injury margin determination.’
286    In the first place, referring to its line of argument put forward in the first plea, the applicant submits that the determination of the injury margin in the contested regulation is vitiated by the same errors of assessment as the undercutting calculation.
287    The Court notes in that regard, like the Commission, that the applicant fails to explain in a sufficiently specific and substantiated manner how and in what way the injury margin determined by the Commission on the basis of the method referred to in paragraphs 283 to 285 above is affected by those alleged errors concerning the use of a ‘simplified PCN’ and the alleged failure to provide adequate non-confidential summaries of figures for sampled Union producers. In particular, in the present plea, the applicant fails to explain how the type-by-type basis comparison infringes Article 9(4) of the basic regulation, given that that provision does not impose any particular methodology on the Commission in order to ensure that the anti-dumping duty does not go beyond what is necessary to counter the injurious effects of the dumped imports concerned. In that regard, it should also be recalled that the complaints put forward by the applicant in support of its first plea concerning the questions of the Commission’s use of a ‘simplified PCN’ and the failure to provide adequate non-confidential summaries of certain data were rejected in the analysis of that plea, in paragraphs 44 to 111 above.
288    In the second place, the applicant maintains that the methodology used by the Commission in the contested regulation was not such as to guarantee that the anti-dumping duty amount would not take account of the injurious effects caused by factors other than Korean imports, namely, on the one hand, the SAP price formula and the impact of the investments of the Union industry and, on the other, imports from Türkiye and Japan.
289    First, as regards the SAP price formula and the impact of the investments of the Union industry, it is apparent from the examination of the first complaint of the third part of the second plea (see paragraphs 227 to 232 above) that the applicant has failed to demonstrate that such factors contributed to the injury suffered by the Union industry. Consequently, the applicant may not criticise the Commission for having failed to disregard the alleged injurious effects of those factors.
290    Second, as regards the imports from Türkiye and Japan, the Court finds that the applicant has failed to establish that the methodology used by the Commission was not appropriate for determining the suitable level of duty that would enable the injury caused to the Union industry by the dumped imports to be eliminated, in accordance with Article 9(4) of the basic regulation. In that regard, it should be noted that, by ensuring that the injury margin expresses only the difference between the weighted average import price and a Union industry target price calculated in accordance with Article 7(2c) of the basic regulation, the Commission ensured that any injury caused by other factors was not attributed to the dumped imports.
291    As indicated in paragraphs 276 to 278 above, the ‘price undercutting’ method used by the Commission pursuant to Article 7(2c) of the basic regulation is based on the use of a Union industry hypothetical target price which, in contrast to the actual Union industry sale prices, is not affected by the effects of other injurious factors recognised by the Commission.
292    In that regard, in its written pleadings submitted to the Court, the applicant, referring to the judgment of 27 March 2019, Canadian Solar Emea and Others v Council (C‑236/17 P, EU:C:2019:258), argues that that method runs counter to the obligation referred to in paragraph 169 of that judgment, not to attribute to the targeted imports any injury caused by other factors. However, the applicant relies on the judgment of 27 March 2019, Canadian Solar Emea and Others v Council (C‑236/17 P, EU:C:2019:258) for the sole purpose of establishing the existence of such an obligation, without however claiming specifically that that judgment actually called into question the use of that method when there are other injurious factors present. Nor is there anything in that judgment to suggest that the Court of Justice stated that recourse should not be had to the ‘price undercutting’ method, now codified in Article 7(2c) of the basic regulation, on the ground that that method is such as to infringe the rule that the anti-dumping duty amount must not take account of the injurious effects caused by factors other than the dumped imports.
293    It should also be observed that, in its application, the applicant did not specifically and actually challenge the weighted average import price used by the Commission to establish price undercutting. In its reply, however, it submits for the first time, that Korean prices are also depressed by other factors, including, in particular, low-priced Japanese and Turkish imports. It is clear that that allegation is inadmissible because it is put forward for the first time in the reply. In any event, that allegation, which was, moreover, never put forward in order to challenge the causal link between imports from Korea and the injury suffered by the Union industry, does not contain any specific, substantiated explanation in the reply, and nor is it supported by specific evidence of the impact of those other factors on Korean prices.
294    In the light of the foregoing considerations, the Court finds that the applicant has failed to establish that the Commission made manifest errors of assessment and infringed Article 3(3) or Article 9(4) of the basic regulation in applying its method for calculating the injury margin and anti-dumping duty rate or that the Commission had infringed its rights of defence.
295    Consequently, the third plea must be dismissed in its entirety.
D.      Fourth plea: infringement of the rights of the defence and the right to sound administration during the investigation
296    The applicant puts forward three parts in support of its fourth plea. First, it alleges several infringements of its rights of defence by the Commission, with the result that the applicant was not placed in a position in which it could effectively make known its views on the correctness and relevance of the facts and circumstances alleged and on the evidence presented by the Commission. Secondly, the applicant argues that the Commission infringed its rights of defence on account of the substantial changes made to the macroeconomic indicators after the general disclosure document. Thirdly, the applicant submits that the Commission, in its analysis of macroeconomic indicators, infringed the applicant’s right to sound administration.
297    The Commission, supported by the interveners, disputes the applicant’s arguments.
1.      First part of the fourth plea: infringement of the rights of the defence in the course of the investigation
298    In support of the first part of the fourth plea, the applicant submits, in essence, that the Commission committed numerous infringements of the rights of the defence, and refers, in that regard, to Annexes A.10 and A.34 to the application, which contain, respectively, the applicant’s observations on the comments of the interested parties and the conclusions concerning the rights of the defence which it had submitted to the Commission during the administrative procedure. According to the applicant, the Commission infringed its rights of defence because the comments submitted by the Union producers and their replies to the Commission’s questionnaire during the investigation were excessively redacted and on account of late additions to the non-confidential file, the inadequacy of the non-confidential summaries and the acceptance of late submissions made by Union producers. Next, the applicant submits that the Commission failed to examine its complaint, put forward during the administrative procedure, alleging that the non-confidential versions of NSE’s and Evonik’s questionnaire replies were deficient. According to the applicant, the Commission expressly recognised that the non-confidential versions of a questionnaire and of the submission on PCN presented by the ad hoc coalition of Union SAP producers did not permit a reasonable understanding of the substance of the information submitted in confidence. Lastly, the applicant claims that, by stating that it would take into account the comments even after expiry of the deadlines specified in the notice of initiation, the Commission acknowledged that evidence had not been added to the file in due time to allow the applicant to exercise its rights of defence.
299    First of all, it should be borne in mind that, according to settled case-law, the ‘summary of the pleas in law’ which must be stated in any application, means that the application must specify the nature of the grounds on which the application is based. Thus, for an action before the General Court to be admissible, it is necessary, in particular, that the basic matters of law and fact relied on be indicated, at least in summary form, coherently and intelligibly in the application itself. Whilst the body of the application may certainly be supported and supplemented on specific points by references to extracts from documents annexed thereto, a general reference to other documents, even those annexed to the application, cannot make up for the absence of the essential arguments in law which must appear in the application (judgment of 16 March 2023, GABO:mi v Commission, C‑696/21 P, not published, EU:C:2023:217, paragraphs 47 and 48).
300    In the present case, it is clear that, in the first part of the fourth plea, the applicant makes a general reference to Annexes A.10 and A.34 to the application without specifying, in its written pleadings submitted to the Court, the lacunae, insufficiencies and shortcomings relied on, and without even referring to specific passages of those annexes. Those arguments of the applicant must be rejected as inadmissible.
301    Moreover, as is apparent from paragraphs 92 to 102 above, the basic regulation, in particular Article 6(7) and Article 20 thereof, defines the procedural guarantees ensuring interested parties’ right to information. Article 19 of the basic regulation further defines the framework in which the competent authorities must respect the confidentiality of information they gather in the course of anti-dumping investigations.
302    In the present case, the Court notes that, on 7 June 2021, as part of its investigation, the Commission sent an email to the applicant produced as Annex A.35 to the application. That email contained the Commission’s response to the applicant’s submissions of 4 May, 27 May and 2 June 2021.
303    It was stated in the email, in the first place, that, contrary to the applicant’s assertions, the Commission had not received submissions from Union producers after expiry of the deadlines. In the second place, the Commission, following the applicant’s submissions, had checked the non-confidential versions of the questionnaire replies of BASF and NSE and Evonik’s response to the ‘Makro questionnaire’ and, on that basis, had requested BASF to provide an amended version by 8 June 2021. The Commission also noted that it had not found issues with regard to the other documents referred to above. In the third place, the Commission had claimed that, since the PCN structure was amended after the observations on the submissions of interested parties, the applicant’s complaint that the coalition of producers would not have provided an appropriate non-confidential summary was no longer relevant as the arguments put forward had not been followed. Lastly, the Commission had confirmed, with regard to the other submissions that had been belatedly made available to the file, that it would consider the applicant’s comments even after the deadlines specified in the notice of initiation and that the deadline for the applicant to submit comments had been extended to 21 June 2021.
304    First of all, it is apparent from the content of that email that the applicant’s arguments to the effect that the Commission had not examined its complaints by which it alleged, first, that the non-confidential versions of the questionnaire replies of NSE and Evonik were deficient and, second, that the PCN conclusions presented by the coalition of Union SAP producers did not permit a reasonable understanding of their confidential observations must be rejected, inasmuch as the Commission expressly responded to the applicant’s complaints in the letter of 7 June 2021.
305    Next, the applicant’s argument to the effect that certain evidence had not been placed in the file in time for it to be able to exercise its rights of defence must also be rejected. It is apparent from the letter of 7 June 2021 that the Commission granted the applicant a two-week extension of the deadline (from 7 to 21 June 2021) to respond to the late submissions.
306    As regards the arguments concerning the allegedly excessive redaction of the Union producers’ submissions, the Court notes that the Commission had to pay particular attention not to reveal confidential information contained in the submissions of the interested parties, in accordance with the case-law referred to in paragraphs 92 to 102 above. Moreover, the applicant does not dispute the confidential nature of the redacted information and has failed to demonstrate that essential facts and considerations were not communicated to it, or that the limitations on the information that was provided to it were such as to undermine the fair balance between its rights of defence and the Commission’s obligation to preserve the confidentiality of the information in question.
307    Consequently, the first part of the fourth plea must be rejected as partly inadmissible and partly unfounded.
2.      Second and third parts of the fourth plea: infringement of the rights of the defence and right to sound administration due to substantial changes made to the macroeconomic indicators after the general disclosure document, the Commission’s refusal to indicate the nature of and reason for its error, the one-day period given to the applicant to submit comments and the refusal to provide corrected data
308    In the second and third parts of the fourth plea, the applicant argues, in essence, that the Commission infringed its rights of defence and its right to sound administration by making substantial changes to the macroeconomic indicators during the administrative procedure.
309    In support of the second part of the fourth plea, the applicant submits that there were substantial differences between the figures in the investigation file and those disclosed by the Commission in the general disclosure document. Moreover, according to the applicant, the second additional final disclosure confirmed its claims during the administrative procedure that the macroeconomic indicators had been improperly calculated and that the initial findings in the general disclosure document had omitted certain quantities relating to those indicators. Thus, all the indicators revised in the second additional final disclosure showed an improvement in trends as compared to the initial ones set out in the general disclosure document. The applicant observes that it was provided only with ranges in the second additional final disclosure. In essence, the applicant criticises the Commission: (i) for failing to state the reasons which led to such substantial changes to the macroeconomic indicators, thus preventing the applicant from commenting on the impact of that error on the investigation; (ii) for having given the applicant only one day in which to submit comments on the impact of those substantial changes, although the applicant requested an extension of the time limit through the Hearing Officer; and (iii) for having refused to provide actual corrected data instead of ranges.
310    In support of the third part of the fourth plea, the applicant argues, in essence, that the Commission infringed the principle of sound administration when examining the macroeconomic indicators. In particular, it submits that the Commission, in its initial assessment, underestimated a number of macroeconomic indicators, which raises doubts as to the diligence with which the investigation was conducted, and infringed the applicant’s right to sound administration by failing to examine carefully and impartially all the relevant aspects of the individual case.
311    As a preliminary point, it should be borne in mind that, although the applicant, as it expressly confirmed at the hearing, does not refer to that article in its written pleadings, Article 20(5) of the basic regulation provides as follows:
‘Representations made after final disclosure is given shall be taken into consideration only if received within a period to be set by the Commission in each case, which shall be at least 10 days, due consideration being given to the urgency of the matter. A shorter period may be set whenever an additional final disclosure has to be made.’
312    That provision sets out the means by which the parties concerned, including exporters, may exercise their right to be heard, which constitutes one of the fundamental rights recognised by the European Union legal order and includes the right to be informed of the essential facts and considerations on the basis of which it is intended to recommend the imposition of definitive anti-dumping duties (judgment of 20 May 2015, Yuanping Changyuan Chemicals v Council, T‑310/12, not published, EU:T:2015:295, paragraph 209 and the case-law cited).
313    Article 20 of the basic regulation defines the specific requirements stemming from the rights of defence of the undertakings concerned by an anti-dumping proceeding. More specifically, Article 20(5) of the basic regulation grants undertakings which have received the final disclosure the right to submit any representations within the period set by the Commission, which must be at least 10 days (judgment of 20 May 2015, Yuanping Changyuan Chemicals v Council, T‑310/12, not published, EU:T:2015:295, paragraph 211 and the case-law cited).
314    However, failure to comply with the 10-day period prescribed in Article 20(5) of the basic regulation can result in annulment of the contested regulation only where there is a possibility that, due to that irregularity, the administrative procedure might have had a different outcome (judgment of 20 May 2015, Yuanping Changyuan Chemicals v Council, T‑310/12, not published, EU:T:2015:295, paragraph 213 and the case-law cited).
315    It must also be recalled that the fact that final disclosure is incomplete renders the regulation imposing definitive anti-dumping duties unlawful if, as a result of the omission, the interested parties were not in a position to defend their interests effectively (see, to that effect, judgment of 4 March 2010, Foshan City Nanhai Golden Step Industrial v Council, T‑410/06, EU:T:2010:70, paragraph 112).
316    Lastly, it is settled case-law that the Commission is required, during an administrative procedure, in the matter of defence against dumped imports from non-EU countries to respect the fundamental rights of the European Union, which include the right to sound administration enshrined in Article 41 of the Charter of Fundamental Rights of the European Union. According to the case-law relating to the principle of sound administration, where the institutions of the European Union have a power of appraisal, respect for the rights guaranteed by the European Union legal order in administrative procedures is of even more fundamental importance. Those guarantees include, in particular, the duty of the competent institution to examine carefully and impartially all the relevant aspects of the individual case (see, to that effect, judgment of 25 January 2017, Rusal Armenal v Council, T‑512/09 RENV, EU:T:2017:26, paragraph 189 and the case-law cited).
317    In the present case, as observed in paragraphs 16 to 19 above and as stated in recital 49 of the contested regulation, on 24 January 2022 the Commission provided the interested parties with the general disclosure document. That disclosure comprised, inter alia, a document containing the essential facts and considerations on the basis of which it intended to impose a definitive anti-dumping duty.
318    In response to the submissions of the interested parties, the Commission published two additional final disclosure documents on 4 and 21 February 2022. The first document set out the method used by the Commission to determine import volumes and made certain corrections to import prices. The deadline granted to interested parties to submit comments on that document ran until 10 February 2022. The Commission received the applicant’s comments on 8 February 2022 and a hearing was held with the Commission’s services on 9 February 2022.
319    The second document was communicated in response to comments formulated by the applicant which, on the basis of its own market intelligence, had indicated that the global macroeconomic indicators for the Union industry figures contained in the general disclosure document seemed too low. In the light of those comments, the Commission found that there was an accidental omission of the data of a non-sampled Union producer. In order to correct that error, the Commission published an updated set of macroeconomic statistics and the interested parties had one day in which to submit their comments.
320    In that regard, the second additional final disclosure, produced as Annex A.37 to the application, states inter alia:
‘Following final disclosure, interested parties highlighted some discrepancies in the macroindicators for production and sales between the complaint and the disclosure. After analysis, the Commission accepted these claims and corrected the figures. The Commission notes that the trends of the revised figures are consistent with the original injury picture, and therefore are not such as to change the Commission’s initial injury assessment. The Commission hereby provides additional information following the Final disclosure on the basis of the revised figures.’
321    The Commission also stated that, since the changes concerned a single company, revised figures had been shown in ranges in order to ensure data confidentiality.
322    Moreover, as stated in paragraph 21 above, the applicant requested the intervention of the Hearing Officer and a hearing with that officer was held on 25 February 2022. According to the Draft Report of the Hearing Officer, produced as Annex A.39 to the application, it found as follows:
‘… while there had been certain discrepancies regarding the overall data, these had been corrected in the Second ADD and the overall trends did not appear to have been subject to significant change. [The Hearing Officer] observed that the party had been granted two hearings before the current hearing with the Hearing Officer. [The Hearing Officer] underlined the fact that this case is under very tight deadlines, and invited the Commission services, having regard to the overall circumstances and the deadlines of the case, to consider any possibility to insert some clarifications in the final text to be submitted in the process.
As to the request for an extension of the deadlines to submit comments, [the Hearing Officer] observed that this could not be granted since the Hearing Officer must respect the deadline of proceedings.’
323    It follows from the foregoing considerations that, in the second additional final disclosure, the Commission established revised figures for certain macroeconomic indicators.
324    Those macroeconomic indicators included, in particular, consumption, market shares, production, capacity, capacity utilisation, sales and employment. In that regard, it is apparent from Annexes A.3 and A.37 to the application that the differences between the macroeconomic indicators contained in the general disclosure document and in the second additional final disclosure include, in particular, a difference of over 100 000 tonnes in terms of consumption (Table 1 of those annexes), a difference of over 200 000 tonnes in terms of production and production capacity of Union producers (Table 4 of those annexes), and a difference of over 130 000 tonnes in terms of sales of Union producers on the Union market (Table 5 of those annexes), whereas, as regards employment (Table 6 of those annexes), more than half of total Union producer employment was not included in the general disclosure document and was added for the first time in the second additional final disclosure. Those revisions led mathematically to an increase in market share for Union industry. However, the revised indicators reveal similar trends in relation to the indicators disclosed initially in the general disclosure document, as also found by the Hearing Officer (see paragraph 322 above).
325    The Court accordingly notes that the changes in the second additional final disclosure brought about a substantial increase in the absolute amounts, as acknowledged by the Commission in recital 55 of the contested regulation. Yet, despite those differences, the trends found in the general disclosure document remained essentially unchanged in the second additional final disclosure, with the result that those changes did not have a significant impact on the injury indicators concerned. In particular, the Court finds that it has not been established that the Commission’s observation in that same recital, to the effect that ‘…trends shown by all indicators went into the same directions as the indicators originally disclosed[; the] total production index stayed the same with only a minimal increase for the year 2018[; the] capacity utilisation index, the total sales index, the total employment index, the productivity index and the export index showed trends going in the same direction, even if not with the same magnitude’ is vitiated by a manifest error of assessment.
326    In that regard, in the first place, the applicant’s arguments to the effect that, first, the Commission did not divulge the source of the error contained in the macroeconomic indicators referred to in the general disclosure document and, second, the Commission’s use of ranges in the second additional final disclosure prevented the applicant from gaining a reasonable understanding of the revised macroeconomic indicators, must be rejected.
327    First, as acknowledged by the applicant, at the hearing with the Hearing Officer the Commission stated that the non-inclusion of the data of one Union producer had been due to a clerical error. That finding is reiterated in recitals 52 and 57 of the contested regulation. Thus, the applicant received a sufficient explanation for why there was a discrepancy. Moreover, since the Commission identified and corrected that clerical error in the course of the investigation, it has not been established that the Commission failed to examine all aspects of the case carefully and impartially.
328    Second, as regards the Commission’s use of ranges, the Court notes that those ranges were necessary to preserve the confidentiality of specific sales and other statistics of the Union producer whose data had mistakenly not been taken into account in the initial disclosure, since those supplementary data were confidential within the meaning of Article 19 of the basic regulation. In the present case, given the limited number of producers and the detailed market information to which the applicant has access, the Commission had to pay particular attention so as not to reveal confidential information. Moreover, the Court notes that the ranges in the present case are sufficiently narrow and thus make it possible to determine the changes or corresponding trends between the various indicators and to obtain an idea of the magnitude of those changes. In that regard, the applicant has failed to show specifically and actually how it would have been able to ensure its defence had it not been for those alleged irregularities.
329    In the second place, as regards the deadline granted, the parties agree that the applicant had only one day in which to submit its comments on the impact of the changes made to the macroeconomic indicators following the second additional final disclosure.
330    By granting the applicant a period of less than 10 days to comment on the additional final disclosure document, the Commission infringed Article 20(5) of the basic regulation. However, as stated in paragraph 314 above, that fact cannot, in itself, lead to the annulment of the contested regulation.
331    The applicant submits in that regard that, in view of the substantial changes made to the macroeconomic indicators, it was not given sufficient time to analyse properly the impact of those changes on the injury indicators and to make its view known, especially in view of the time difference with the Republic of Korea. It submits that it could only prepare its presentation on the elements that were included in the second additional final disclosure comments, but that it did not have the opportunity to analyse further their impact on the injury analysis.
332    In recital 52 of the contested regulation, it is stated, in that regard, that the applicant did not seek any extension to the deadline granted for submitting its comments on the second additional final disclosure, and that it was granted two hearings after the first deadline for submitting comments, during which time it had the opportunity to present its comments on the second additional final disclosure.
333    In that regard, first, the Court notes that the applicant was granted a hearing to present its comments on the second additional final disclosure on 23 February 2022. Moreover, on 25 February 2022 a hearing was held with the Hearing Officer, although with a different objective, that of the Commission’s services applying the rights of defence of interested parties, as stated in Decision (EU) 2019/339 of the President of the European Commission of 21 February 2019 on the function and terms of reference of the hearing officer in certain trade proceedings (OJ 2019 L 60, p. 20). Second, it is apparent from the Request for Intervention of the Hearing Officer, produced as Annex A.38 to the application, that the applicant had requested the Hearing Officer to recommend to the Commission to grant it a period of seven days to review and update its comments on the general disclosure document in the light of the changes brought by the second additional final disclosure.
334    It is thus apparent from those considerations that the applicant was granted a period of one day to present its comments in writing on the content of the second additional final disclosure and that only one hearing was scheduled to allow it to present its comments orally, within two days. Moreover, the applicant had requested, solely through the Hearing Officer, an extension of the deadlines so that it could properly present its position on the second additional final disclosure.
335    Yet, as indicated in paragraph 102 above, it is for the applicant to establish specifically how it would have been better able to ensure its defence in the absence of such an irregularity – in the present case, the allegedly insufficient time period for submitting comments – without merely pleading that it was impossible for it to provide comments on hypothetical situations.
336    As stated in paragraph 325 above, it is common ground in the present case that the new revised figures did not make any substantial changes to the trends found in the general disclosure document. It must further be emphasised that the modified data were similar to the data with which the applicant was already familiar on the basis of its market intelligence, as observed by the Commission in recital 54 of the contested regulation, where it is stated that the amendments to macrodata initially communicated ‘had been requested by [the applicant] in its comments to the final disclosure prior to the [second] ADD’ and that, ‘further to pointing out the dimensions of the data from the complaint, [the applicant had] even provided data from market intelligence, which shows similar values than the ranges provided in the 2nd ADD’.
337    The Court notes here that it is apparent from the applicant’s comments on the second additional final disclosure (produced as Annex A.36 to the application) that it formulated specific comments on the revised indicators (see paragraphs 15 to 28 of those comments) concerning, inter alia, the effect of the dumped imports and of imports from third countries.
338    The Court further notes that the applicant has not adduced any evidence before the Court liable to demonstrate that, if it had had additional time in which to present its comments on the second additional final disclosure, it would have been able to better ensure its defence and, on that occasion, present additional helpful arguments, with the result that, in the absence of the irregularity committed by the Commission, the administrative procedure would have potentially had a different outcome.
339    It is also apparent from the examination of the first to third pleas that the applicant has not put forward any argument before the Court liable to call into question the overall assessment of the economic situation and of the injury to the Union industry carried out by the Commission.
340    Consequently, the second and third parts of the fourth plea must be rejected as unfounded. Consequently, the fourth plea in law must be rejected.
E.      Conclusion
341    In the light of the foregoing considerations, the action must be dismissed in its entirety.
IV.    Costs
342    Under Article 134(1) of the Rules of Procedure of the General Court, the unsuccessful party is to be ordered to pay the costs if they have been applied for in the successful party’s pleadings.
343    Since the applicant has been unsuccessful, it must be ordered to bear its own costs and to pay the costs incurred by the Commission and by the interveners, in accordance with the form of order sought by them.
On those grounds,
THE GENERAL COURT (Seventh Chamber, Extended Composition)
hereby:
1.      Dismisses the action;
2.      Orders LG Chem, Ltd. to bear its own costs and to pay those incurred by the European Commission, BASF Antwerpen NV, Nippon Shokubai Europe NV and Evonik Superabsorber GmbH.
Kowalik-Bańczyk
Buttigieg
Hesse
Dimitrakopoulos
Ricziová
Delivered in open court in Luxembourg on 19 March 2025.
V. Di Bucci
M. van der Woude
Registrar
President
Table of contents
I. Background to the dispute
II. Forms of order sought
III. Law
A. First plea: manifest errors of assessment and infringement of Article 3(3) of the basic regulation and the rights of the defence in the analysis of the price effect of imports from the Republic of Korea on the Union industry’s products
1. Preliminary remarks
2. First part of the first plea: manifest errors of assessment and infringement of Article 3(3) of the basic regulation due to the use of a ‘simplified PCN’ to calculate price undercutting
(a) The Commission’s approach to the PCN breakdown
(b) The influence of CRC and end uses on costs and prices in the hygiene sector (first complaint)
(1) CRC
(2) End uses in the hygiene sector
(c) Interchangeability of SAP (second complaint)
(d) The use of different PCN structures for the purpose of calculating the dumping margin and price undercutting (third complaint)
3. Second part of the first plea: infringement of the rights of the defence due to the price undercutting calculations disclosed to the applicant not permitting a proper understanding of the substance of the information submitted in confidence
4. Third part of the first plea: manifest errors of assessment and infringement of Article 3(3) of the basic regulation due to allegations of price depression or price suppression resulting from Korean imports
(a) The formula for calculating SAP prices
(b) Whether there were manifest errors of assessment
B. Second plea: manifest errors of assessment, infringement of Article 3(2), 3(5), 3(6) and 3(7) of the basic regulation, and failure to state reasons by analysing the injury situation of Union producers in a biased manner and by attributing the alleged injury to Korean imports, rather than to other known factors
1. Preliminary remarks
2. First part of the second plea: manifest errors of assessment and infringement of Article 3(2) and (5) of the basic regulation due to partial and incomplete analysis of the injury situation of Union producers
(a) The analysis of volumes in the contested regulation
(b) The analysis of prices, costs and profitability in the contested regulation
(c) Analysis of the export performance of the Union industry in the contested regulation
3. Second part of the second plea: manifest errors of assessment and infringement of Article 3(6) of the basic regulation due to the attribution of injurious effects to imports from the Republic of Korea
4. Third part of the second plea: manifest errors of assessment and infringement of Article 3(7) of the basic regulation due to failure to identify and take into account other known factors of injury
(a) Impact of the SAP price formula and impact of investments
(b) Imports from Türkiye
(c) Imports from Japan and NSE’s alleged predatory strategy
C. Third plea: manifest errors of assessment, infringement of Article 3(3) and Article 9(4) of the basic regulation and infringement of the rights of the defence through determination of the injury margin based on a simplified PCN, failure to provide adequate non-confidential summaries of the injury margin calculations and failure to reflect other known injury factors in the injury margin determination
D. Fourth plea: infringement of the rights of the defence and the right to sound administration during the investigation
1. First part of the fourth plea: infringement of the rights of the defence in the course of the investigation
2. Second and third parts of the fourth plea: infringement of the rights of the defence and right to sound administration due to substantial changes made to the macroeconomic indicators after the general disclosure document, the Commission’s refusal to indicate the nature of and reason for its error, the one-day period given to the applicant to submit comments and the refusal to provide corrected data
E. Conclusion
IV. Costs
*      Language of the case: English.
1       The present judgment is published in extract form.