1992R3068 — EN — 25.03.1994 — 001.001 — 1
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►B COUNCIL REGULATION (EEC)No 3068/92
of 23 October 1992
imposing a definitive anti-dumping duty on imports of potassium chloride originating in Belarus,
Russia or Ukraine
(OJ L 308, 24.10.1992, p. 41)
Amended by:
Official Journal
No page date
►M1Council Regulation (EC) No 643/94 of 21 March 1994 L 80 1 24.3.1994
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COUNCIL REGULATION (EEC)No 3068/92
of 23 October 1992
imposing a definitive anti-dumping duty on imports of potassium
chloride originating in Belarus, Russia or Ukraine
THE COUNCIL OF THE EUROPEAN COMMUNITIES,
Having regard to the Treaty establishing the European EconomicCommunity,
Having regard to Council Regulation (EEC) No 2423/88 of 11 July 1988
on protection against dumped or subsidized imports from Countries not
members of the European Economic Community(
1), and in particular
Article 11 thereof,
Having regard to the proposal presented by the Commission after
consultation within the Advisory Committee as provided for in thatRegulation,
Whereas:
A.PROVISIONAL MEASURES
(1)By Regulation (EEC) No 1031/92(2), the Commission imposed a
provisional anti-dumping duty on imports into the Community ofpotassium chloride originating in Belarus, Russia or Ukraine. ByRegulation (EEC) No 2442/92(
3) the Council extended this duty
for a period ot exceeding two months.
B.SUBSEQUENT PROCEDURE
(2)Following the imposition of the provisional anti-dumping duty,
the Belarussian, Russian and Ukrainian exporters, the Communityproducers and certain importers requested and were granted a
hearing by the Commission. They also submitted comments in
writing.
(3)The parties' oral and written comments were considered, and the
Commission altered its conclusions accordingly where necessary.
(4)This investigation was not concluded within the period specified
in Article 7 (9) (a) of Regulation (EEC) No 2423/88 owing to thecomplexity of the proceedings, particularly the detailed checking
of the many figures and arguments put forward.
C.PRODUCT, LIKE PRODUCT
(5)The product which is the target of the proceeding is potassium
chloride or potash muriate (termed ‘potash’), and is usually usedas an agricultural fertilizer. Information gathered during the
Investigation shows that potash is available in two grades:
‘standard’ (powder) or ‘granulated’ (granules). As explained inrecitals 8 to 10 of Regulation (EEC) No 1031/92, the potassiumcontent (expressed as the percentage of the weight of the dryanhydrous product represented by K
2O) of both grades varies.
Each grade has three different specifications: K2O content of 40 %
or less, K2O content of between 40 and 62 %, and K2O content of
over 62 %. The three specifications correspond to CN codes3104 20 10, 3104 20 50 and 3104 20 90.
(6)For the purposes of the preliminary conclusions, the ‘over 62 %’specification was disregarded, for the reasons given in recital 10of Regulation (EEC) No 1031/92.
Following the hearings conducted after the publication of
Regulation (EEC) No 1031/92, the Commission decided to takethe ‘over 62 %’ specification into account for its final findings, as1992R3068 — EN — 25.03.1994 — 001.001 — 2
(1) OJ No L 209, 2. 8. 1988, p. 1.
(2) OJ No L 110, 28. 4. 1992, p. 5.
(3) OJ No L 243, 25. 8. 1992, p. 1.
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it emerged from the information gathered that although this
specification was most often used in pharmaceuticals and industryits physical and chemical characteristics were largely identical to
the specifications with a lower potassium content, and it could
therefore be used in their place. The Commission thereforeconsidered the different grades and specifications of potash to beone and the same product.
It should be pointed out, however, that the specification with the
highest potassium content does not exist in granulated form at themoment, seemingly for technical and economic reasons. It istherefore unnecessary to distinguish between the standard andgranulated grades in the case of potash with a K
2O content of over
62%. The Council confirms these findings.
D.DUMPING
(a)Normal value
(7)Since Belarus, Russia and Ukraine are still considered non-market
economy countries, normal value had to be calculated inaccordance with Article 2 (5) of Regulation (EEC) No 2423/88.
The choice of Canada, the world's second largest producer, was
not disputed by any of the parties, and normal value was thereforeestablished on the basis of Canadian domestic prices in the case ofgranular potash and on Canadian and US prices for standardpotash, Canadian sales of which were too low to constitute a
representative basis relative to imports into the Community from
the former USSR.
(8)Since the production costs of the mining firm which assisted inthe investigation were greater than Canadian and US marketprices, the Community producers asked for normal value to beassessed on the basis of that firm's production costs. However,during the investigation, the Commission verified that Canadian
and US market prices still made it possible for other producers to
make profits in normal trade transactions. It then emerged that thefirm was bearing temporary and exceptional costs because of thespecial situation of the area of Canada in which its mine waslocated, and because the mine had started operations a short timebefore. To add these costs to those of the exports from the former
USSR would have been unfair and contrary to Article 2 (5) (a) of
Regulation (EEC) No 2423/88.
Establishing normal value on the basis of price levels on the
competitive Canadian and US markets is therefore a reasonable
and appropriate approach. The Council confirms the Commis-
sion's findings and the findings given in recitals 13 to 16 ofRegulation (EEC) No 1031/92.
(b)Export price
(9)The export prices of potash exported by producers in the former
USSR were determined in the manner described in recitals 17 to
20 of Regulation (EEC) No 1031/92, and in accordance with the
terms of Article 2 (8) (b) of Regulation (EEC) No 2423/88.
(c)Comparison
(10)Normal value and export prices were compared at the ex-mine
stage, transaction by transaction.
(11)Certain importers pressed for an adjustment in connection withthe deduction of sea freight costs, arguing that they used cheaper
(when compared to other companies) vessels from the former
USSR for transportation between the ports of the former USSRand the Community. The costs selected by the Commission werethose actually paid by the main importer. The Commissioncalculated the sea freight costs on that basis, obtaining a figurelower than that established in Regulation (EEC) No 1031/92.1992R3068 — EN — 25.03.1994 — 001.001 — 3
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(12)In connection with haulage costs between the mines and ports of
the former USSR, which had been calculated on the basis of
Canadian mines and ports as described in recital 20 of Regulation(EEC) No 1031/92, one importer claimed that account should betaken of the fact that one of the three production sites (theBelaruskali mine) was closer to a port. This was considered, andnothing was found in the record of the proceeding or in the
importers' or exporters' replies to indicate that it was possible to
determine the source of potash imported into the Communityfrom the former USSR, and thus the portion which had come fromthe closest mine. The Commission therefore judged it reasonableand appropriate to assume that each site contributed an equal
portion of potash exports to the Community. The cost of
transporting the potash between plants and ports in the formerUSSR was therefore determined on the basis of Canadiantransport costs, while taking into account the distances betweeneach of the production sites in the former USSR and the ports.
(13)The exporters and some of the importers claimed that there was adifference in grade and in the anti-caking treatments supposedlynecessary for certain end-uses which justified a downwardadjustment of the prices of potash from the former USSR. Inthe light of the fact that the chemical characteristics of potashfrom Canada, the former USSR and the Community are strictly
identical, the Commission had to dismiss the argument
concerning quality. With regard to the argument concerninganti-caking treatment, the Commission found no difference inmanufacturing processes, and the investigation showed no proofthat potash originating in the countries of the former USSR
needed any kind of special treatment when compared to potash
from other countries in order to make it fit for use. No adjustmentwas therefore found to be justified.
(14)The Commission did, however, observe that potash from theformer USSR did not always exactly match potash from the
Community and Canada in terms of crystal size. The exporters
and a number of importers furthermore pointed out that deliveriesand shipping of potash from the former USSR were less reliable,while these considerations do not alter the fundamentalcharacteristics of the product, the Commission thought anadjustment of the order of 2 % to be reasonable in the light of
the consumers' image of potash from the former USSR. The
Council confirms these findings.
E.DUMPING MARGIN
(15)The final examination of the facts revealed that potash from
Russia, Belarus and Ukraine had been dumped. The dumpingmargin is equal to the difference between the normal value andthe export price. In view of the way in which the exporters whichparticipated in the investigation were organized and the fact that
they were represented by a single state organization, a single
dumping margin was calculated for all of them. The averageweighted dumping margin so calculated was 24 % of the total cifvalue of the exports in question. The Council confirms thesefindings.
F.INJURY
(16)The Commission pointed out in its preliminary conclusions that
substantial injury had been caused to Community producers
(recitals 24 to 33 of Regulation (EEC) No 1031/92). No new
argument was put forward in this connection. The Councilconfirms that Community producers have suffered substantialinjury.
G.CAUSAL LINK BETWEEN DUMPING AND INJURY
(17)In recitals 34 to 37 of Regulation (EEC) No 1031/92, the
Commission pointed out that the increase in the volume ofcheaper potash exports from the countries of the former USSR1992R3068 — EN — 25.03.1994 — 001.001 — 4
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had coincided with growing losses in the Community industry.
All the parties concerned agreed that the potash market was atransparent one and extremely sensitive to price changes. It was
thus clear that imports of potash from the former USSR at prices
below those charged by the Community industry had caused thatindustry serious injury.
With regard to other considerations, the possibility of exports
from other sources affecting the Community industry could not bedismissed. The Commission made a distinction between thepotential effects of such imports and the injury caused by the
imports which are the subject of this proceeding, however. The
reason for this was the relatively small volume of imports fromother sources and the absence of evidence of price undercutting.The Commission was furthermore aware that the demand forpotash has decreased in the last few years. The effects of thisconsideration have, however, been dissociated from the injury
caused by imports from the former USSR. In fact the injury is
mainly indicated by more pronounced losses. The Commissioninvestigation, moreover, did not yield any findings proving orlikely to constitute proof that the Community producers' manage-ment practices could have contributed to the injury sustained.
(18)In the light of the foregoing and the reasons put forward inrecitals 34 to 37 of Regulation (EEC) No 1031/92, the Councilconfirms that dumped imports of potash from Belarus, Russia andUkraine, taken in isolation, have caused serious injury toCommunity producers.
H.DUTY
(19)The Commission has recalculated the level of duty needed to
remove the injury according to the method set out in recital 38 of
Regulation (EEC) No 1031/92. No objections to this method wereexpressed, and the Council confirms that the definitive dutyshould be equal to the dumping margin.
With regard to the form of the duty, the Commission moreover
considers that the margin of manœuvre available to exporters incountries which still have no market economy, and the effect on
the entire potash market of even slight price undercutting, mean
that neither a fixed-rate nor an ad valorem duty would be certain
to remove the injury caused by dumping. Since no new argumentshave been advanced on this issue, the Commission has concludedthat an anti-dumping duty should be adopted in the form of aminimum price.
(20)Since the value of the products is related essentially to their K2O
content, the minimum price should be calculated definitively forthe standard and granulated grades of each of the threespecifications according to the method set out in recital 40 ofRegulation (EEC) No 1031/92. The Council confirms these
findings.
I.COMMUNITY INTEREST
(21)The parties have presented no further facts or arguments
concerning Community interest to the Commission. The Councilconfirms the Commission's conclusions, contained in recitals 41to 48 of Regulation (EEC) No 1031/92, that it is in theCommunity's interest to remove the injury caused by the observed
dumping of exports from Belarus, Russia and Ukraine, and thus to
halt the decline of Community output without denying theexporters concerned access to the Community market.
J.UNDERTAKING
(22)The Belarussian, Russian and Ukrainian exporters offered to
propose a price undertaking. However, the offer concerned anundertaking in principle and was not based on any specific price.The Commission considered this simple undertaking in principle1992R3068 — EN — 25.03.1994 — 001.001 — 5
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to be unacceptable, and informed the exporters concerned of its
decision and the reasons behind it.
K.COLLECTION OF THE PROVISIONAL DUTY
(23)In view of the size of the dumping margins established and the
degree of injury to the Community industry, the Council judges it
necessary to collect the amounts secured by way of provisionalanti-dumping duty up to the level of the definitive duty, with thebalance being released,
HAS ADOPTED THIS REGULATION:
Article 1
1. A definitive anti-dumping duty is hereby imposed on imports of
potassium chloride (KCI) falling within CN codes 3104 20 10,
3104 20 50, 3104 20 90, originating in Belarus, Russia and Ukraine.
2. The amount of duty shall be equal to the fixed amount per tonne of
KCI shown below per type and grade, or the difference between theprices shown below and the net, free-at-Community-frontier price per
tonne KCI, before customs clearance for the corresponding type and
grade, whichever is the higher:
Potassium chloride with a K2O contentFixed amount of
duty per tonne KClPrice CIF cif
Community frontier
per tonne KClTaricc ode
40 % or less:
— standard grade
(powder) ECU 24,19 ECU 76,79 3104 20 10*10
— granulated grade
(granules) ECU 27,37 ECU 86,91 3104 20 10*20
Over 40 % but less than or equal to
62 %:
— standard grade
(powder) ECU 36,28 ECU 115,19 3104 20 50*10
— granulated grade
(granules) ECU 41,06 ECU 130,36 3104 20 50*20
over 62 %:
— standard grade
(powder) ECU 44,13 ECU 137,28
3. The provisions in force with regard to customs duties shall apply
Article 2
The amounts secured by way of provisional anti-dumping duty pursuant
to Regulation (EEC) No 1031/92 shall be definitively collected up to thelevels resulting from the application of the definitive duties imposed inArticle 1 (1).
The balance of the security collected shall be released.1992R3068 — EN — 25.03.1994 — 001.001 — 6
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Article 3
This Regulation shall enter into force on the day of its publication in the
Official Journal of the European Communities .
This Regulation shall be binding in its entirety and directly applicable in
all Member States.1992R3068 — EN — 25.03.1994 — 001.001 — 7