2001R1644 — EN — 14.08.2001 — 000.001 — 1
This document is meant purely as a documentation tool and the institutions do not assume any liability for its contents
►B COUNCIL REGULATION (EC)No 1644/2001
of►C1 8 August 2001 ◄
amending Regulation (EC)No 2398/97 imposing a definitive anti-dumping duty on imports of
cotton-type bed linen originating in Egypt, India and Pakistan and suspending its application with
regard to imports originating in India
(OJ L 219, 14.8.2001, p. 1)
Corrected by:
►C1Corrigendum, OJ L 260, 28.9.2001, p. 39 (1644/2001)
▼B
COUNCIL REGULATION (EC)No 1644/2001
of►C1 8 August 2001 ◄
amending Regulation (EC)No 2398/97 imposing a definitive anti-
dumping duty on imports of cotton-type bed linen originating inEgypt, India and Pakistan and suspending its application with
regard to imports originating in India
THE COUNCIL OF THE EUROPEAN UNION,
Having regard to the Treaty establishing the European Community, andinparticular Article 133 thereof,
Having regard to Council Regulation (EC) No 1515/2001 of 23 July
2001 on the measures that may be taken by the Community following areport adopted by the WTO Dispute Settlement Body concerning anti-dumping and anti-subsidy measures(
1),
Having regard to Council Regulation (EC) No 384/96 of 22 December
1995 on protection against dumped imports from countries not membersof the EuropeanCommun ity(
2) (‘the basic Regulation’),
Having regard to the proposal made by the Commission after
consultation of the Advisory Committee,
Whereas:
A.EXISTING MEASURES
(1)The Council, by Regulation (EC) No 2398/97(3), imposed a
definitive anti-dumping duty on imports of cotton-type bed linen
originating in Egypt, India and Pakistan (‘definitive Regulation’).
The definitive Regulation was preceded by Commission Regula-tion (EC) No 1069/97 of 12 June 1997 imposing a provisionalanti-dumping duty on imports of cotton-type bed linen originatingin Egypt, India and Pakistan(
4) (‘provisional Regulation’).
B.REPORTS ADOPTED BY THE DISPUTE SETTLEMENT
BODY OF THE WTO
(2)On12 March 2001, the Dispute Settlemen t Body of the World
Trade Organisation (‘WTO’) adopted an Appellate Body reportand a panel report as modified by the Appellate Body report on
the case ‘European Communities — anti-dumping duties on
imports of cotton-type bed linen from India’ (Reports).
C.PRODUCT UNDER CONSIDERATION AND LIKE PRODUCT
(3)The product concerned is certain bed linen of cotton fibres, pure
or mixed with man-made fibres or flax (flax not being the
dominant fibre), bleached, dyed or printed originating in India,Pakistan and Egypt, falling within CN codes ex 6302 21 00(TARIC codes 6302 2100*81, 6302 2100*89), ex 6302 22 90(TARIC code 6302 22 90*19), ex 6302 31 10 (TARIC code630231 10*90), ex 6302 31 90 (TARIC code 6302 3190*90),
ex 6302 3290 (TARIC code 6302 3290*19). The Reports do not
affect the findings set out in the definitive Regulation concerningthe product under consideration and the like product.2001R1644 — EN — 14.08.2001 — 000.001 — 2
(1) OJ L 201, 26.7.2001, p. 10.
(2) OJ L 56, 6.3.1996, p. 1. Regulationas last amen ded by Regulation(EC) No
2238/2000 (OJ L 257, 11.10.2000, p. 2).
(3) OJ L 332, 4.12.1997 p. 1. Regulationas last amen ded by Regulation(EC) No
554/2000 (OJ L 68, 16.3.2000, p. 1).
(4) OJ L 156, 13.6.1997, p. 11.
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D.REVISED FINDINGS BASED ON THE REPORTS
1.Preliminary remark
(4)The Commission reassessed findings by taking account of the
recommendations set out in the Reports on the basis ofinformation which was collected in the original investigation
which took place in1996/97. The reassessmen t shows that
injurious dumping still exists although at lower levels.
It is recalled that the investigation of dumping covered the period
from 1 July 1995 to 30 June 1996 (‘IP’). The investigationrelating to the parameters relevant in the context of the injuryassessment covered the period from 1 January 1992 up to the endof the IP (30 June 1996). This period will be referred to as ‘theperiod considered’.
2.Dumping
2.1.Introduction
(5)This part sets out the reassessed findings based on the
recommendations of the Reports concerning:
(a) determination of sales, general & administrative expenses
(‘SG&A’) and profit when applying Article 2(6)(a) of thebasic Regulation for the purpose of constructed normal values
and
(b) the practice of ‘zeroing’ when establishing the weighted
average marginof dumpin g.
(6)All other calculationmethods applied are those used intheoriginal investigation. For further details, reference is made to the
abovementioned provisional Regulation and definitive Regula-
tion.
2.2.Sampling
(7)It is recalled that inview of the large n umber of exporters inthe
countries concerned, it was decided during the original investiga-tion to apply sampling in accordance with Article 17 of the basicRegulation.
2.3.India
(8)Since only one out of the five companies in the main sample for
India had representative global domestic sales and the profitable
domestic types represen ted less than80 % but more than10 % of
total domestic sales, the amounts for SG&A and profit used toconstruct normal value were those actually made in the ordinarycourse of trade by this company, in accordance with the firstsentence of Article 2(6) of the basic Regulation.
(9)For the other four companies, in order to comply with therecommendations of the Reports and in accordance with Article2(6)(a) of the basic Regulation, the amounts for SG&A andprofits used to construct normal value were the weighted averageof the actual amounts incurred and realised by the company withrepresentative global domestic sales mentioned above and a
reserve company which had also representative global domestic
sales. It should be noted that sales not made in the ordinary courseof trade have not been eliminated when determining the profitmarginattributable to the other four compan ies.
(10)No changes have been necessary as far as the original findings
concerning the export price and adjustments pursuant to Article
2(10) of the basic Regulation are concerned.
(11)The weighted average constructed normal value by type wascompared with weighted average export price by type, asdetermined above. In compliance with the recommendations of2001R1644 — EN — 14.08.2001 — 000.001 — 3
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the Report, no ‘zeroing’ was applied in calculating the overall
dumping margin for each company.
(12)The revised dumping margins expressed as a percentage of the cifimport price at the Community frontier for India are thefollowing:
Anglo French Textiles 9,8 %
Bombay Dyeing & Manufacturing Co. Ltd and
Nowrosjee Wadia & Sons Ltd 5,5 %
Madhu Industries Ltd and Madhu International 3,0 %Omkar Exports 0,0 %Prakash CottonMills Ltd 0,0 %
(13)Cooperating companies not selected in the sample for India were
attributed the average dumping margin of the companies in thesample, weighted onthe basis of their export turn over to theCommunity. In accordance with Article 9(6) of the basicRegulation, when calculating this average dumping margin any
zero andde minimis margins established have been disregarded.
Expressed as a percentage of the cif import price at theCommunity frontier, this revised dumping margin for India is5,7 %.
(14)For non cooperating companies in India a revised dumpingmarginwas determin ed onthe basis of the facts available inaccordance with Article 18 of the basic Regulation. The level ofcooperation during the original investigation was high. Therefore,
it is considered appropriate to set the dumping margin for non
cooperating companies in India at the level of the highestdumping margin established for a company in the sample. Indeed,it would constitute a bonus for non cooperation to assume that thedumping margin attributable to exporters/producers which did notcooperate is lower than the highest found for a cooperating
exporter/producer. This revised residual dumping margin for
India, expressed as a percentage of the cif import price at theCommunity frontier, is 9,8 %.
2.4.Egypt andPakistan
(15)The findings on dumping with regard to imports originating in
Egypt and Pakistan have not been revised. The relevant dumpingmargins are set out in recitals 29 to 31 of the definitiveRegulation.
3.Community industry and sampling
(16)The findings concerning the definition of the Community industry
and standing remain unaffected by the conclusions set out in theReports (see recital 34 of the definitive Regulation). The same is
true with regard to sampling of the Community industry (see
recitals 58 to 61 of the provisional Regulation).
4.Injury
4.1.Preliminaryremark
(17)The Reports conclude that the Community acted inconsistently
with the WTO Agreement on Implementation of Article VI of theGeneral Agreement on Tariffs and Trade (‘ADA’)
(i) by considering information for producers not part of the
Community industry as defined by the Council in analysingthe state of the industry;
(ii) by failing to evaluate all relevant factors having a bearing on
the state of the Community industry, and specifically all thefactors set forth inArticle 3.4 ADA. Inthis respect, it isrecalled that the determinations concerning productivity,2001R1644 — EN — 14.08.2001 — 000.001 — 4
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stocks, utilisationof capacity, ability to raise capital or
investments, cash flow, wages and the magnitude of dumpingmargins were not fully described in the provisional and
definitive Regulation.
The Panel also expressed the opinion that imports attributable
to a producer/exporter found not to be dumping could not be
considered as falling within the notion of ‘dumped imports’for purposes of injury analysis. However, since India had notcontested the injury finding on this ground and there were noIndian producers who had been found not to be dumping, the
Panel reached no conclusions in this regard. The claim that
India had made — that non-dumped transactions should beexcluded from the injury analysis — was rejected by thePanel as unfounded.
(18)The injury findings established in the original investigation werereexamined in the light of the Panel's conclusions. It was alsoexamined whether the exclusion of Indian exporters found not tohave dumped would have led to any change in the injury findings.The results of this re-examination are set out below.
(19)The approach described inrecital 62 of the provisional Regulationwas revised by eliminating data relating to producers which werenot part of the Community industry. In the present Regulation, thedata were analysed as follows:
(i) at the level of the Community industry, for trends concerning
production, sales by volume, market share, employment andgrowth. The relevant data were obtained from the verifiedquestionnaire responses in the case of the 17 sampledproducers, and from the information collected with regard
to the further 18 producers forming part of the Community
industry;
(ii) at the level of the sampled Community producers, for the
trends concerning prices and profitability, cash flow, abilityto raise capital and investments, stocks, utilisation ofcapacity, wages and productivity, on the basis of theaforementioned questionnaire responses.
In addition, the magnitude of the margin of dumping was
examined.
4.2.ConsumptionintheCommunity
(20)The findings set out in recital 63 of the provisional Regulation
remain unaffected by the recommendations in the Reports. It isrecalled that Community consumption of the product concerned(as measured by productionplus imports min us exports)decreased from around 200000 tonnes in 1992 to around
186000 tonnes in the IP, a decrease of approximately 7 %.
4.3.Cumulation,volume,marketshareandpricesoftheimports
fromthethreecountriesconcerned
(21)In the original investigation it was found that dumped imports
from the three countries concerned increased from 33825 tonnesin 1992 to 46656 tonnes during the IP, i.e. an increase by 38 %
during the period considered. During the same period, the market
share of dumped imports increased from 16,9 % to 25,1 % (seerecital 67 of the provisional Regulation).
(22)If the imports from exporters found not to have dumped areexcluded, the increase in volume of dumped imports wouldremain significant, as shown in the table below, namely anincrease of 30 %. The market share of the remaining importsincreased by 40 % during the period considered. It stillrepresented more than 21 % of the Community market during
the IP.
Dumped imports 1992 1993 1994 1995 IP
Volume — tonnes 30593 33484 29500 39036 398252001R1644 — EN — 14.08.2001 — 000.001 — 5
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Dumped imports 1992 1993 1994 1995 IP
Index 100 109 96 128 130
Market share 15,3 % 17,2 % 15,2 % 20,6 % 21,4 %Index 100 112 99 135 140
(23)
Furthermore, it is recalled that during the period considered, the
prices of imports from India and Egypt had actually fallen by up
to 18 % (see recital 80 of the provisional Regulation). This
decrease is not significantly changed if the imports from theIndian exporters found not to have dumped are excluded.
(24)During the IP, the level of undercutting of the dumped imports
originating in India ranged from 13,8 % to 40,7 %, expressed as
percentages of the adjusted average prices of the Communityindustry, and this is also unaffected if imports from the exportersfound not to have dumped are excluded. It is recalled that, withrespect to Pakistan the level of undercutting ranged from 27,9 %to 34,4 % and with respect to Egypt from 23,8 % to 53,7 %.
4.4.Situation ofthe Communityindustry
4.4.1. General remarks
(25)It should be recalled that during the original investigation, not all
injury factors listed in Article 3.4 of the ADA (Article 3(5) of the
basic Regulation) were found to have a bearing on the state of the
Community industry. This was the case for stocks and capacity ofproduction.
(26)In addition, it was also found that some factors were in fact
closely linked to a number of injury factors set out in detail in the
regulations. This was the case in particular for productivity withproduction and employment, and cash flow and return oninvestments with profitability. Accordingly, only the develop-ments of the main injury factors were fully addressed in theprovisional and definitive Regulations.
(27)The findings below only relate to the Community industry asdefined in recital 34 of the definitive Regulation. Obviously, theindicators listed in subparagraph (ii) of recital 17 have beenestablished at the level of sample.
4.4.2. Stocks and capacity of production
(28)These indicators were found not to have a bearing on the state of
the Community industry.
(29)As to stocks, this is the case for two reasons. Firstly, production
(e.g. of printed patterns) often takes place in response to or inanticipation of orders placed by particular clients, thus reducing
the possibility to produce purely for stocks. Secondly, stock
valuationoftentakes place at 31 December, which is towards theend of a peak period of activity for the bed linen sector. Largestock variations can take place between one year and anothersimply because of large orders leaving the warehouse on 30December in one season and 2 January the next. While some
increase in stocks was observed in some companies, neither the
complainant nor any sampled Community producer adducedincrease in stocks as evidence of injury. An increase in stocks inthis sector can thus indicate increased actual or anticipated ordersrather than unsold production.
(30)As to production capacity, the Community industry is char-acterised by a large number of highly flexible small and medium-sized companies. Machinery can, relatively easily, be bought, soldor used for other products. Under these circumstances, reliablecapacity of productionfigures were extremely difficult to2001R1644 — EN — 14.08.2001 — 000.001 — 6
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establish throughout the period considered in the present case.
However, the investigation showed that many producers wereable to maintain a high rate of capacity utilisation and even had to
subcontract surplus production, to allow them to run at high
utilisationevenindepressed periods.
4.4.3. Production, employment and productivity
(31)The findings of recitals 81 and 91 of the provisional Regulation
concerning production and employment of the Communityindustry are confirmed. The Community industry was able to
increase its total production of bed linen from 39370 tonnes in
1992 to 42 781tonnes during the IP,namely an increase by 8,7 %.In the meantime, employment declined by 5,3 %. This trend wasalso replicated at the level of the sampled producers.
(32)The combination of these two factors explains the improvementin productivity of the sampled Community producers during theperiod considered.
Community industry 1992 1993 1994 1995 IP
Productivity index 100 99 110 111 111
4.4.4. Wages
(33)
Community industry 1992 1993 1994 1995 IP
Wages (Index) 100 102 98 107 107
Despite the fall in personnel employed the overall amount of
wages paid to the employees directly working in the bed linen
sector increased by 7 % during the period considered. Averagewages per employee increased by 6 % from 1993 up to the end ofthe IP but should be compared with the 5,5 % increase inconsumer price in the Community during the same period (seerecital 86 of the provisional Regulation).
4.4.5. Sales volume, market share and price develop-
ment
(34)The figures onsales volume, value, market share an d pricedevelopments as set out in recitals 82 to 88 of the provisionalRegulation refer, unless otherwise indicated, to the sampledCommunity producers. They are herewith confirmed.
(35)During the period considered, sales by the Community industryslightly increased from 36 205 tonnes to 36553 tonnes, an
increase of 1 %. In that period, their market share also increased
slightly, from 18,1 % to 19,7 % because of more sales of highervalue niche products.
Community industry 1992 1993 1994 1995 IP
Sales volume —
tonnes36205 34505 37726 37555 36553
Index 100 95 104 104 101
4.4.6. Profitability, cash flow and return on invest-
ments
(36)The findings made in recital 89 of the provisional Regulationconcerning profitability are confirmed. Profitability of theCommunity industry decreased from 3,6 % to 1,6 % of turnoverduring the period considered, namely a fall by over 50 %. In other2001R1644 — EN — 14.08.2001 — 000.001 — 7
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words Community industry's profits shrunk from ECU 10 million
in 1992 to ECU 4,6 million during the IP, namely a reduction byaround ECU 5,4 million during the period considered.
(37)The cash flow generated by the Community industry developed asfollows:
Community industry 1992 1993 1994 1995 IP
Cash flow
(1 000 ECU)25566 16663 20446 17475 18432
Index 100 65 80 68 72
(38)Between 1992 and the IP cash flow remained positive but
declined by 28 % or by around ECU 7 million. Thus, cash flowand profitability of the Community industry followed a similardecreasing trend during the period considered.
(39)As to return on investment, the investigation showed that themaintenance of the production tools was the main purpose of theCommunity industry's investments during the period considered:
Community industry 1992 1993 1994 1995 IP
Profit/investments 16 % 7 % 14 % 8 % 7 %
Index 100 45 87 50 45
(40)The overall trend followed by the return on investments is similar
to that of profitability.
4.4.7. Ability to raise capital
(41)During the period considered, the capital raised via bank credits
by the Community industry increased by 3 %.
Community industry 1992 1993 1994 1995 IP
Credits raised
(1 000 ECU)141400 118700 117000 133800 145100
Index 100 84 83 95 103
(42)During the investigation there was no claim from the Community
industry nor any indication that the Community industryencountered problems to raise the capital needed for its activity.Given that no major investments were made by the Communityindustry it can reasonably be assumed that most of the credits
were used to finance the daily activity in the bed linen sector.
This additional need in credits during the IP is likely to bejustified by the decrease incash flow.
4.4.8. Growth and factors affecting domestic prices
(43)It is noted that the growth of the Community industry was
particularly negative between 1994 and the IP in term of salesvolume (– 1 173 tonnes). The growth in market share was very
limited in the same period (+ 0,2 %) and was even negative
between1995 an d the IP. At the same time, the growth of marketshare of low-priced dumped imports remained always positiveand was significant. Between 1994 and the IP, dumped importsincreased by 35 % (+ 10 315 tonnes) and the growth in marketshare was as high as 6,2 percentage points.2001R1644 — EN — 14.08.2001 — 000.001 — 8
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(44)When evaluating factors affecting domestic prices the analysis
focussed primarily on the contraction of demand and raw cotton
prices.
The investigation clearly showed that the gap left by Community
factory closures and the fall in imports from certain other thirdcountries during the period considered was filled by imports fromthe countries concerned, of which most of them were found to be
dumped. Giventhat the prices of the dumped imports were the
lowest of all the operators selling bed linen on the Communitymarket it is concluded that the contraction of demand in itself didnot have an overriding impact on prices, notably those of theCommunity industry.
(45)The price of raw cotton, which can represent up to 15 % of thetotal cost of bed linen, increased significantly during the periodconsidered. Normally, in fair market conditions, producers shouldhave beenable to pass onthis cost in crease to customers. The
investigation has shown that the Community industry was not
able to do so inthis case.
(46)It is also noted that there was significant price undercutting as
described inrecital 24.
4.4.9. Magnitude of the dumping margin
(47)As concerns the impact on the Community industry of the
magnitude of the actual margin of dumping, given the volume andthe prices of the imports from the countries concerned, this
impact cannot be considered to be negligible.
4.5.Conclusiononinjury
(48)The investigation clearly established that imports from the
countries concerned significantly increased during the periodconsidered. In terms of volume, the increase was as high as 38 %
or 12800 tonnes and their market share increased by 8,2
percentage points.
(49)The investigation also established that prices of the imports
concerned decreased considerably and that there was significant
price undercutting by all three countries. Prices declined by up to18 % and undercutting margins ranging from 11,9 % to 53,7 %were found to exist.
(50)While the Community industry, as defined above, managed toincrease production and to slightly increase its sales volume andmarket share by concentrating on more sales of higher value nicheproducts, it nevertheless suffered declining and inadequateprofitability, which is basically the result of prices which had
not been able to reflect the increases in the costs of raw cotton or
to keep pace with inflation in prices of consumer goods. Theinjury indicators related to profitability such as cash flow andreturn on investments also showed declining trends. The sameholds true for employment.
(51)On this basis, and in particular because of the declining andinadequate profitability and price suppression suffered by theCommunity industry, the finding of the definitive Regulation thatthe Community industry had suffered material injury is
confirmed.
5.Causation
5.1.Introduction
(52)Based on the above findings on dumping and injury, the causal
link analysis set out in the provisional and the definitiveRegulationwas likewise re-examin ed.
(53)In compliance with the Panel's and the Appellate Body'srecommendations, a causal link had to be demonstrated betweenthe dumped imports and the situation of the Community industry,2001R1644 — EN — 14.08.2001 — 000.001 — 9
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i.e. the abovementioned 35 producers. Thus, the references found
for existing producers which were not part of the Communityindustry or producers which previously closed down their bed
linen operations (see recitals 105, 109 and 110 of the provisional
Regulation) were not considered relevant for the causal linkanalysis.
5.2.Effect ofthe dumpedimports
(54)It is recalled that dumped imports from the three countries
concerned increased by 12 800 tonnes in absolute terms and by
38 % in percentage terms (9200 tonnes or 30 % if the importsfrom exporters found not to have dumped are excluded). Themarket share held by the dumped imports increased during theperiod considered from 16,9 % to 25,1 %, namely by 8,2percentage points (15,3 % to 21,4 %, namely 6,1 percentage
points if the imports from the Indian exporters found not to have
dumped are excluded). During the IP, their weighted averageundercutting margin was at around 29 %.
(55)Sales by the Community industry increased by 348 tonnes and its
market share increased from 18,1 % to 19,7 %, namely by 1,6
percentage point. The Community industry's weighted averagesales price remained by and large stable.
(56)It is also recalled (recital 97 of the provisional Regulation) that
the market for bed linen is characterised by product substitut-
ability and transparency. Large Community purchasers of bedlinen, which can ensure a high level of production capacity andtherefore some economy of scale, are very sensitive to prices. Onthis basis, it canbe con cluded that the low prices offered by the
exporting producers concerned, coupled with their substantial and
increasing market share, have exercised continuous downwardpressure onprices onthe Commun ity market.
(57)Indeed, despite the fact that the Community industry managed to
shift productionan d sales to higher value products inorder to
maintain production and sales' levels, average sales prices did notincrease.
(58)As stated in recital 99 of the provisional Regulation, price
suppression and consequent decreasing profitability were the
main indicators to conclude that the Community industry sufferedmaterial injury. In view of the coincidence in time between thedeterioration of the state of the Community industry and thesignificant increase of the low-priced dumped imports, it is
confirmed that there was a direct link between these imports and
the material injury found. Thus, the conclusions set out in recitals96 to 99 of the provisional Regulation can be confirmed.
5.3.Effects ofotherfactors
(59)The effect of other factors onthe situationof the Commun ity
industry was likewise examined.
5.3.1. Increase in raw cotton prices
(60)The findings set out in recitals 102 and 103 of the provisional
Regulationcanbe con firmed.
5.3.2. Development of Community consumption
(61)It is recalled that certain exporters suggested that any injury being
suffered by the Community industry should be ascribed to the
steady decrease in total consumption of the product concerned, by
7 % between1992 an d the IP.
The investigation showed that sales by the Community industry
increased slightly by 348 tonnes, imports from other thirdcountries undercutting the prices of the Community industryincreased by over 5 000 tonnes, and dumped imports from thethree countries concerned increased by around 12 800 tonnes. The2001R1644 — EN — 14.08.2001 — 000.001 — 10
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impact of the decrease in consumption was felt notably by
Community producers not forming part of the Communityindustry.
(62)In addition, it should be recalled that the Community industry
managed to increase its sales of niche products by adapting and
expanding its existing range of products to certain segments of themarket. Thus, it is clear that the Community industry was hardlyaffected, if at all, by the developments in Community consump-tion.
5.3.3. Imports from other third countries
(63)The findings in recitals 100 and 101 of the provisional Regulation
remainun affected.
5.3.4. Competition from non-complainant producers
inthe Commun ity
(64)The findings in recitals 107 and 108 of the provisional Regulationremainun affected.
5.4.Conclusiononcausation
(65)The above analysis shows that there is a clear and direct link
between the increase in volume and the price effect of dumpedimports, and the material injury suffered by the Communityindustry.
(66)The investigation has shown that the countries concernedincreased their exports by 38 % or by 12 800 tonnes. This
corresponds to an increase in market share of 8,2 percentage
points. It is clear that the presence of increasing volumes of low-priced imports had a considerable impact on the market overall.
(67)Although the Community industry managed to slightly increaseits sales volume because of higher sales of niche products, it isclear that the imports from the countries concerned prevented thatindustry of taking any significant share of the market left by other
third country and Community operators during the period
considered.
(68)The direct link between the effect of the dumped imports and theinjury suffered by the Community industry is further demon-strated by the existence of high undercutting margins which canexplain the gain in market share of the countries concerned. It isalso evidenced by the impact which the fall in import price had onthe Community industry. Prices were suppressed and profitability
fell from 3,6 % in1992 to 1,6 % durin g the IP.
(69)The analysis of the effects of other factors than dumped imports
on the state of the Community industry has likewise confirmedthe above direct causal link.
(70)Consequently, the conclusion reached in recital 43 of thedefinitive Regulation that the dumped imports from Egypt, Indiaand Pakistan have caused the material injury suffered by theCommunity industry is confirmed.
6.Community interest
(71)The contents and conclusions reached in recitals 44 to 46 of the
definitive Regulation remain unaffected by the Reports.
E.GROUNDS FOR THE SUSPENSION OF THE MEASURES
(72)As shownabove, a full examin ationof the facts established inthe
original investigation taking account of the recommendations setout in the Reports demonstrates that imports from Egypt, Indiaand Pakistan were still injuriously dumped. Notwithstanding this,the Council does not consider it appropriate to continue to collectduties for exports from India for the reasons given below.2001R1644 — EN — 14.08.2001 — 000.001 — 11
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(73)It is recalled that the findings are based on information which was
collected in1996/97.
(74)A wider examination of the impact of the recommendations setout in the Reports would have necessitated consideration being
givento the applicationof the various other altern atives (e.g.other methods of calculating SG&A and profit provided for inArticle 2(6)(b)(c) of the basic Regulation) excluding those foundinconsistent in the Reports. However, this has not proved possiblein this case since the necessary information was not collected in
the original investigation. Indeed, prior to the Reports it was not
considered relevant either to collect such information or toprogram it into the verification process. The determination of theprofit margin when constructing normal value for exporterswithout sufficient sales in the ordinary course of trade is based on
a methodology which the Appellate Body report advocated.
However, the Council considers that the methodology as specifiedby the Appellate Body is not appropriate in this particular case,not least because it implies a discriminatory treatment betweenexporters, whose ownprofit marginis used, an d exporters whichfall under Article 2(6)(a) of the basic Regulation (i.e. for which
the weighted average SG&Aand profit margins of other exporters
are used). It is also in contradiction with the principle to base ingeneral the normal value on data relating to sales made in theordinary course of trade.
(75)In these exceptional circumstances it was considered that the bestcourse of action is to amend the definitive Regulation on the basisof the dumping margins established in recitals 12 to 14 which are
in all cases lower than the injury margins and to suspend the
collectionof duties at the rates established above while providin gall interested parties concerned with an opportunity to submitinformation/observations and, if appropriate, a review request.
(76)The Indian authorities, the Indian exporters and their association,all interested parties in the Community, in particular theCommunity industry, importers, users' and traders' associations,received disclosure of the reassessed findings and were given an
opportunity to comment and to be heard. The oral and written
comments submitted by these parties were considered but havenot altered the conclusions reached in this Regulation.
(77)Any requests for a review and any observation/submission ofinformation must be made in writing and be sent to the followingaddress:
EuropeanCommission
Directorate General for Trade
Directorates B and C
TERV — 0/13Rue de la Loi/Wetstraat 200B-1049 BrusselsFax (32-2) 295 65 05Telex COMEU B 21877.
(78)If no review is initiated within six months from the entry intoforce of this Regulationonthe basis of a review request by an y
interested parties, the anti-dumping measure should automatically
expire with regard to imports originating in India. If such reviewis initiated within the aforementioned six months period,suspension should continue during the review investigation,
HAS ADOPTED THIS REGULATION:
Article 1
Article 1 of Regulation(EC) No 2398/97, is hereby amen ded as follows:1. Inparagraph 2 the rate of duty for In dia shall be 9,8 % (TARIC
additional code 8900).2001R1644 — EN — 14.08.2001 — 000.001 — 12
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2. Inparagraph 3 the rate of duty for In dia shall be 5,7 % (TARIC
additional code 8042).
3. In paragraph 4 the rates of duty for the Indian companies listed shall
be as follows:
Country Manufacturer Rate of dutyTARIC additional
code
India Anglo French Textiles 9,8 % 8044
The Bombay Dyeing & Manufac-
turing Co. Ltd5,5 % 8045
Nowrosjee Wadia & Sons Ltd 5,5 % 8045
Madhu Industries Ltd 3,0 % 8046
Madhu International 3,0 % 8046
Omkar Exports 0,0 % 8047
Prakash CottonMills Ltd 0,0 % 8048
Article 2
1. The application of the anti-dumping duties specified in Article 1 is
hereby suspended with regard to imports originating in India.
2. The anti-dumping duties specified in Article 1 shall expire six
months after the entry into force of this Regulation with regard to India
unless a review has been initiated before that date. During such a review,
if any, the application of the anti-dumping duty shall remain suspendedpursuant to paragraph 1.
Article 3
This Regulation shall enter into force on the day of its publication in the
Official JournaloftheEuropeanCommunities .
This Regulation shall be binding in its entirety and directly applicable in
all Member States.2001R1644 — EN — 14.08.2001 — 000.001 — 13