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COMMISSION DECISION No 2767/86/ECSC

of 5 September 1986

imposing a provisional anti-dumping duty on imports of certain sheets and plates, of iron or steel, originating in Yugoslavia

THE COMMISSION OF THE EUROPEAN COMMUNITIES,

Having regard to the Treaty establishing the European Coal and Steel Community,

Having regard to Commission Decision No 2177/84/ECSC of 27 July 1984 on protection against dumped or subsidized imports from countries not members of the European Coal and Steel Community (1), and in particular Article 11 thereof,

After consultations within the Advisory Committee as provided for by the above Decision,

Whereas:

A. Procedure

(1) In October 1985 the Commission received a complaint lodged by the European Confederation of Iron and Steel Industries (Eurofer) on behalf of producers whose collective output constitutes the majority of Community production of the product in question. The complaint contained evidence of dumping and of material injury resulting therefrom, which was considered sufficient to justify the initiation of a proceeding. The Commission accordingly announced, by a notice published in the Official Journal of the European Communities (2), the initiation of an anti-dumping proceeding concerning imports into the Community of certain sheets and plates of iron or steel falling within Common Customs Tariff subheading 73.13 B I ex a), and corresponding to NIMEXE codes 73.13-17, 19, 21 and 23, and originating in Yugoslavia, and commenced an investigation.

(2) The Commission officially so advised the exporters and importers known to be concerned, the representatives of the exporting country and the complainants and gave the parties directly concerned the opportunity to make known their views in writing and to request a hearing.

(3) All the Yugoslavian producers and some importers known to the Commission made their views known in writing. None of the interested parties have requested a hearing.

(4) No submissions were made by or on behalf of Community purchasers or processors of sheets and plates of iron or steel.

(5) The Commission sought and verified all information it deemed to be necessary for the purposes of a preliminary determination and carried out investigations at the premises of the following companies:

- EEC producers

Thyssen Stahl AG, Duisburg, Federal Republic of Germany

Dillinger Huettenwerke, Dillingen, Federal Republic of Germany

Peine-Salzgitter AG, Salzgitter, Federal Republic of Germany

Nuova Italsider SpA, Genova, Italy

Acciaierie e Ferriere Lombarde Falck SpA, Milano, Italy

Forges de Clabecq SA, Tubize, Belgium

- EEC importers

Mannesmann Handel AG, Duesseldorf, Federal Republic of Germany

Hermann Schmidt, Import-Export, Essen, Federal Republic of Germany

Franchini Lamiere, San Zeno Naviglio, Italy

(6) The Commission requested and received detailed written submissions from complainant Community producers and some importers and verified the information therein to the extent considered necessary.

(7) The Commission also sent questionnaires to the Yugoslavian producers known to be concerned in order to obtain the necessary information and granted ample extension of the time period laid down for the reply. However, information submitted by the Yugoslavian producers was incomplete and they refused in particular to disclose details of quantities and prices with regard to their domestic market and certain export transactions. Under these circumstances the Commission concluded that on-the-spot verification was not warranted and decided to base its preliminary determinations on the available evidence.

(8) The investigation of dumping covered the period from 1 January to 31 December 1985.

B. Normal value

(9) As all the Yugoslavian producers refused to submit information with regard to sales of sheets and plates of iron or steel on their domestic market the Commission preliminarily established normal values on the basis of the published basic prices (1) as they applied during the investigation period, referred to in the Exchange of Letters (see Final Act of the Agreement between the Member States of the European Coal and Steel Community and the European Coal and Steel Community, of the one part, and the Socialist Federal Republic of Yugoslavia, of the other part - 83/42/ECSC (2).

C. Export prices

(10) Export prices were determined on the basis of the prices actually paid or payable for the products sold for export to the Community.

D. Comparison

(11) In comparing normal value, i.e. basic prices less customs duty, with export prices the Commission took account, where appropriate and to the extent of the evidence available, of differences in conditions and terms of sale such as transport, insurance, forwarding and handling costs.

(12) Since the basic prices are calculated cif Community frontier, all comparisons were made at the level cif Community frontier, duty unpaid.

E. Margins

(13) As far as the information made available to the Commission permitted, export prices were compared with the corresponding normal value derived from from the published basic prices separately for each specific steel quality exported to the Community. For those producers which did not submit information with regard to individual export transactions export prices were compared with an average of the normal value based on the published basic prices for the most representative steel qualities imported by the Community from Yugoslavia.

(14) The above preliminary examination of the facts shows the existence of dumping. The dumping margins vary according to exporter, the weighted average margin for each of the exporters being as follows:

- Rudnici i Zelezara, Skopje: 38 %,

- Metalurski Kombinat, Smederevo: 33 %,

- Zelezarna, Jesenice: 29 %.

F. Injury

(15) With regard to the injury caused by the dumped imports the evidence available to the Commission shows that imports into the Community from Yugoslavia of sheets and plates of iron or steel have increased from 5 600 tonnes in 1980 to 27 700 tonnes in 1983, and to 109 000 tonnes in 1985 with a consequent increase in market share held by the exporting country from 0,1 to 2,1 % over the same period. As the distribition of the product is very sensitive to transport costs, the imports were concentrated mainly in Germany and Italy, where the market share of the Yugoslavian imports climbed from 0,2 to 3,2 % and from 0,1 to 4,1 % respectively. In certain regional markets in Germany and Italy, (which account for over 50 % of the Community consumption of the product in question), the Yugoslavion product reached market shares of up to 18 % in 1985.

(16) The evidence available to the Commission also indicates that the prices of these products undercut the prices of the Community producers during the investigation period to a varying degree according the the market and the steel quality concerned by between 17 and 30 %.

(17) Community production of sheets and plates in 1985 was still some 30 % below the level of 1981, the first full year under the crisis regime introduced by the Commission in autumn 1980 after a period of sharp fall in demand. Despite a certain recovery in demand from the trough reached in 1983, mainly triggered by the return of the overall economy to a modest growth path after the recession, the replenishment of stocks and more favourable conditions for steel exports, crisis measures were maintained until the end of 1985.

(18) In this context the Commission has set up a system of production quotas for ECSC companies. These quotas are adjusted periodically in order to maintain the balance of supply and demand required to sustain viable prices for the industry for the products concerned.

(19) It is an important factor for the market equilibrium to keep imports from third countries at acceptable levels with regard to quantities and prices. The Community therefore has concluded steel arrangements with a large number of steel exporting countries. These arrangements involve quantitative restraints, a reasonable distribution of imports over time, by region and by product and the observance of arrangement prices which are closely linked to the internal price regulations which bind the industry and steel merchants in the Community.

(20) Any sharp increase in imports from countries not covered by an arrangement, such as Yugoslavia, destabilizes the market equilibrium and requires a downward adjustment of the quotas of Community producers and thereby increases their indirect costs and further reduces their margins.

(21) Significant imports of dumped products, especially if they concentrate regionally on certain key product qualities as in the case of Yuvoslavia, at prices which undercut substantially the prevailing ECSC prices have a disproportionately detrimental effect on the market for sheets and plates in the Community. In order to forestall the progressively disruptive effects of such practices, even small steel trading firms in the Community have been made subject to regulations obliging them to observe the price rules.

(22) Imports of significant quantities of dumped products into the Community also jeopardize the objectives sought by the external measures adopted within the framework of the Community steel policy; third countires which have concluded steel trade arrangements with the Community will only abide by and renew these arrangements if they see a reasonable chance of selling the quantities provided for at the price levels agreed.

(23) Significantly increasing imports of dumped products from countries not covered by an arrangement are also jeopardizing the restructuring efforts of the Community steel industry which have led to the shedding of more than five million tonnes of reversing mill plate capacity between 1980 and 1985 with a requirement of further adjustments of capacity over the next few years, in addition to other reductions of capacity.

(24) It can be assumed from the number of import licences for plate and sheet from Yugoslavia issued during the first three months of this year that the dumped imports from Yugoslavia would show a further substantial increase throughout 1986. This would endanger the efforts being made to return to normal market conditions by the gradual dismantling of the crisis measures, the first step of which has been taken by the Community with a relaxation of the quota system and price rules as of 1 January 1986.

(25) The Commission has considered whether injury has been caused by other factors, such as imports of plates and sheets from certain other third countries, and provisionally established that these imports also increased by about the same quantity as those from Yugoslavia. The Commission is, however, satisfied that this increase is mainly attributable to the fact that third countries having arrangements have made fuller use of the agreed tonnages and to reciprocity of trade with EFTA member countries. This increase is not likely to upset the equilibrium of the market because the countries concerned are bound to oberserve the Community price rules.

(26) The substantial increase in dumped imports and the prices at which they are offered for sale in the Community led the Commission to determine that the effect of the dumped imports of plates and sheets of iron or steel originating in Yugoslavia taken in isolation have to be considered as constituting material injury to the Community industry concerned.

G. Community interest

(27) In view of the particularly serious difficulties facing the Community industry, and in the light of the factors referred to above (paragraphs 22 to 24), the Commission has come to the conclusion that it is in the Community's interest that action be taken. In order to prevent further injury being caused during the remainder of the proceeding, this action should take the form of a provisional anti-dumping duty.

H. Rate of duty

(28) Taking into account that it is necessary for the Community industry to achieve the published prices for plates and sheets in order to generate a sufficient flow of earnings to cope with restructuring and to keep the impact on employment within acceptable limits - between 1980 and 1985 some 125 000 jobs were lost in the Community steel industry - the duty should be less than the dumping margins but sufficient to eliminate the price undercutting, at least on average, and be expressed as an amount in ECU to be paid on each tonne imported into the Community.

(29) A period should be fixed within which the parties concerned may make their views known and request a hearing,

HAS ADOPTED THIS DECISION:

Article 1

1. A provisional anti-dumping duty is hereby imposed on imports of certain sheets and plates of iron or steel, not further worked than hot rolled, falling within Common Customs Tariff subheading 73.13 B I ex a), corresponding to NIMEXE codes 73.13-17, 19, 21 and 23 and originating in Yugoslavia.

2. The amount of the duty shall be 68 ECU per 1 000 kilograms.

3. The provisions in force concerning customs duies shall apply.

4. The release for free circulation in the Community of the products referred to in paragraph 1 shall be subject to the provision of a security, equivalent to the amount of the provisional duty.

Article 2

Without prejudice to Article 7 (4) (b) and (c) of Decision No 2177/84/ECSC, the parties concerned may make known their views in writing and apply to be heard by the Commission within one month of the date of entry into force of this Decision.

Article 3

This Decision shall enter into force on the day following its publication in the Official Journal of the European Communities.

Subject to Articles 11, 12 and 14 of Decision No 2177/84/ECSC, it shall apply for a period of four months, unless the Council adopts definitive measures before the expiry of that period.

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

Done at Brussels, 5 September 1986.

For the Commission

Willy DE CLERCQ

Member of the Commission

(1) OJ No L 201, 30. 7. 1984, p. 17.

(2) OJ No C 38, 19. 2. 1986, p. 3.

(1) OJ No L 321, 17. 11. 1982, p. 9, OJ No C 37, 11. 2. 1984, p. 3 and OJ No C 120, 15. 5. 1985, p. 25.

(2) OJ No L 41, 14. 2. 1983, p. 127.