COMMISSION OF THE EUROPEAN COMMUNITIES 
Brussels, 22.06.1998 
COM(1998) 382 final 
Proposal for a 
COUNCIL REGULATION (EC) 
imposing a definitive anti-dumping duty on imports of potassium permanganate 
originating in India and the Ukraine and collecting definitively the 
provisional duty imposed 
(presented by the Commission) 

EXPLANATORY MEMORANDUM 
(1) By Regulation (EC) No 178/98 of 23 January 1998(l), the Commission imposed 
a provisional anti-dumping duty on imports into the Community of potassium 
permanganate originating in India and the Ukraine. Further to the imposition of 
the provisional measures, interested parties submitted comments in writing and 
were granted an opportunity to be heard by the Commission. 
(2) The Commission accepted the claims made by the Indian and Ukrainian 
exporting producers in respect of certain deductions to the export price and 
consequently revised downwards its calculations of dumping (from 6.8% to 
5.6% for India and from 40.4% to 36.2% for the Ukraine). 
(3) All interested parties were informed of the main facts and considerations on the 
basis of which it was intended to recommend the imposition of definitive 
measures and granted sufficient time to make representations. The submissions 
made were examined and taken into account where appropriate. 
(4) In accordance with Article 9(4) of Council Regulation (EC) No 384/96, the 
Basic anti-dumping Regulation, the Commission therefore proposes that the 
Council impose definitive anti-dumping duties on imports into the Community 
of potassium permanganate originating in India and the Ukraine. Given the 
extent of the injury, it is also recommended that the Council collect the 
provisional anti-dumping duties to the extent of the amount of the definitive 
duties imposed. 
OJNoL 19,24.01. 1998, p. 23 
1 
COUNCIL REGULATION (EC) No /98 
of 1998 
imposing a definitive anti-dumping duty on imports of potassium permanganate 
originating in India and the Ukraine and collecting definitively the 
provisional duty imposed 
THE COUNCIL OF THE EUROPEAN UNION, 
Having regard to the Treaty establishing the European Community, 
Having regard to Council Regulation (EC) No 384/96 of 22 December 1995 on 
protection against dumped imports from countries not members of the European 
Community0\ and in particular Article 9 (4) thereof, 
Having regard to the proposal submitted by the Commission after consulting the 
Advisory Committee, 
Whereas: 
A. PROVISIONAL MEASURES 
(1) By Commission Regulation (EC) No 178/98(2) (hereinafter referred to as 'the 
provisional duty Regulation') a provisional anti-dumping duty was imposed on 
imports into the Community of potassium permanganate falling within CN code 
2841 61 00 originating in India and the Ukraine. 
OJ No L 56, 6. 3. 1996, p. 1. Regulation as amended by Regulations (EC) No 2331/96 (OJ 
L317, 6.12.1996, p. 1) and No 905/98 (OJL 128, 30.4.1998, p. 18). 
OJNoL 19, 24.1.1998, p. 23 
4 eu 
B. SUBSEQUENT PROCEDURE 
(2) Following the imposition of the provisional anti-dumping measures, the 
complaining Community industry and both the Indian and Ukrainian co­
operating exporting producers submitted comments in writing. 
(3) The Ukrainian co-operating exporting producer, who was the only interested 
party to have so requested, was granted a hearing. 
(4) The Commission continued to seek and verify all information it deemed 
necessary for its definitive findings. 
(5) Parties were informed of the essential facts and considerations on the basis of 
which it was intended to recommend the imposition of definitive anti-dumping 
duties and the definitive collection of amounts secured by way of provisional 
duties. They were also granted a period within which to make representations 
subsequent to this disclosure. 
(6) The oral and written comments were considered and, where deemed appropriate, 
taken into account in the definitive findings. 
C. PRODUCT UNDER CONSIDERATION AND LIKE PRODUCT 
(7) As no comments or new facts were submitted by any interested party with regard 
to the definition of the product concerned and the like product, the findings made 
on these issues, as set out in recitals 8 and 9 of the provisional duty Regulation, 
are confirmed. 
D. DUMPING 
1) Normal value and export price 
(8) In the absence of further arguments concerning the establishment of normal value 
and export price, the provisional findings as set out in recitals 10 to 17 of the 
provisional duty Regulation, are hereby confirmed. 
2) Comparison 
(9) The Ukrainian and Indian exporting producers claimed that no deduction to the 
export price for certain ancillary costs and credit costs respectively should have 
been made. These issues were examined and since it was found that indeed no 
such deductions should have been made, corrections to the export price were 
made accordingly. 
(10) In the absence of any other new arguments concerning comparison, the remaining 
provisional findings, as set out in recitals 18 to 23 of the provisional duty 
Regulation, are hereby confirmed. 
3) Dumping margin 
General 
(11) In the absence of new arguments concerning the determination of the dumping 
margin, the methodology set out in recitals 24 to 26 of the provisional duty 
Regulation is hereby confirmed. 
India 
(12) The dumping margin definitively established for India, expressed as a percentage 
of the CIF price at Community frontier level, is as follows: 
Universal Chemicals and Industries Pvt. Ltd., Mumbai: 5.6% 
As this company is deemed to represent 100 % of the Indian production of the 
product concerned, the residual dumping margin definitively established is also 
5.6%. 
Ukraine 
(13) The dumping margin definitively established for the Ukraine, expressed as a 
percentage of the CIF price at Community frontier level, is 36.2%. 
E. COMMUNITY INDUSTRY 
(14) As no comments or new facts were submitted by any interested party with regard 
to the definition of the Community industry, the findings made as set out in 
recital 27 of the provisional duty Regulation, are hereby confirmed. 
F. INJURY 
1) General 
(15) Comments were made by the exporting producers in respect of the provisional 
findings regarding the following injury factors: prices of the dumped imports, 
price undercutting and the situation of the Community industry. No other 
interested party expressed any contradicting view. 
2) Prices of the dumped imports and price undercutting 
(16) The Indian and Ukrainian exporting producers both contested the provisional 
findings concerning price undercutting and claimed in particular that information 
they had previously submitted (in the form of "offers" or invoices) had been 
disregarded without sufficient detailed explanations. They again submitted 
information concerning resales of the product concerned in the Community (in 
the form, inter alia, of invoices) obtained from a number of unrelated importers 
allegedly showing the absence of price undercutting. 
It should be noted, however, that the previously and newly submitted information 
concerned importers who either did not co-operate or only insufficiently co­
operated with the Commission's investigation. This information could not, 
therefore, be verified during on-the-spot verifications (in particular as regards the 
existence of possible credit notes reducing actual sales prices or, in the case of 
"offers", as regards the question whether such offers led to actual sales 
transactions or not). In any case it covers a very small part of the imports 
concerned and examined by the Commission. Moreover, in support of their 
contention that the Commission's price undercutting findings were not correct, 
the Indian and Ukrainian exporting producers had submitted calculations based 
on figures concerning their export price on the Community market which did not 
match the corresponding verified figures they themselves reported in the course 
of the investigation. The information submitted cannot therefore invalidate the 
findings of clear price undercutting as set out in recitals 36 to 38 of the 
provisional duty Regulation. 
(17) The Ukrainian exporting producer again claimed that its "special relationship" 
with its sole importer in the Community, allegedly consisting of the importer 
financing the purchase of the raw materials as well as granting pre-payment for 
deliveries, would have necessitated certain adjustments to the export price. 
In this respect, it has to be stressed that this relationship, interrupted in 1997, 
could not be investigated due to the lack of co-operation from the sole importer 
in question. Indeed, despite repeated requests from the Commission, the company 
in question failed to submit relevant data. Therefore, adjustments claimed by the 
Ukrainian exporting producer could not be granted. 
(18) As regards the Community industry's selling price used in order to determine the 
price undercutting margin, it was alleged that data reported by the German 
producer (Chemie GmbH Bitterfeld-Wolfen) had been disregarded. 
In this respect it should be recalled that, as indicated in the provisional duty 
Regulation, the calculation of price undercutting was made by comparing the 
prices of the Community industry as a whole, i.e. its weighted average prices, 
including those of the Community producer in question, with prices of the Indian 
and Ukrainian exporting producers. 
Moreover, it should be stressed that, as noted in recital 37 of the provisional duty 
Regulation, the Commission based the price undercutting calculation on import 
sales figures adjusted for post-importation costs, i.e. for customs duty, loading 
and warehousing costs and credit costs (prices were adjusted to a cash payment 
level), in conformity with the Community Institutions' established practice and 
as requested by the exporting producers in their submissions. 
(19) The undercutting margins of 26% for the Ukraine and 8.4% for India as set out in 
recital 38 of the provisional duty Regulation, are accordingly hereby confirmed. 
3) Situation of the Community industry 
(20) The exporting producers alleged that, in the assessment of the situation of the 
Community industry, data relating to the German producer's situation had been 
fully excluded from the analysis. 
Again, this allegation is not correct as the provisional findings were based on an 
overall assessment of the situation of the entire Community industry. Only the 
costs of production of the German producer were disregarded in the calculation 
of the injury elimination level (see recital 31 of the present Regulation), and its 
profitability data were not included when determining the injury indicator 
'profitability of the Community industry'. Indeed, it was found that these figures 
were likely to be influenced by the current restructuring of its operations. This is 
in conformity with the usual practice of the Community Institutions, consisting of 
disregarding extraordinary items in accounts. In any event, had the German 
producer's data relating to these two items been taken into consideration, the 
situation of the Community industry would have been found to be even worse. 
All other injury indicators were examined taking into consideration the verified 
information given by both the German producer and the Spanish producer 
(Industrial Quimica del Nalôn) constituting the Community industry. 
(21) It was also alleged that, on balance, the injury indicators did not show that the 
Community industry was experiencing material injury. The exporting producers 
based this allegation on an improvement of the situation of the industry following 
the previous imposition of anti-dumping measures on Chinese imports by 
Council Regulation (EC) No 2819/94 (3) and the data relating to the exceptional 
year 1995 where demand for the product concerned increased substantially 
because of climatic circumstances. 
OJL 298,19.11.194, p. 32 
It is considered that these considerations should not detract from the weak overall 
situation of the Community industry. Indeed, prices of the Community industry 
decreased by 10% from 1992 to the investigation period (April 1996 to March 
1997), in a very price-sensitive market, and the Spanish producer recorded losses 
for the same period, while the Indian and Ukrainian exporting producers undercut 
the Community industry's prices significantly and doubled their market share of 
potassium permanganate on the Community market. 
It should also be recalled that the injury indicators have to be seen in the context 
of an industry recovering from past dumping. Accordingly, the injury indicators 
should be assessed bearing in mind the overall historical situation of the market, 
which had been affected by Chinese dumped imports, with a consecutive impact 
on the Community industry's state and with certain positive consequences for the 
situation of the Community industry after the imposition of anti-dumping 
measures concerning Chinese imports. 
4) Conclusion on injury 
(22) In the light of the above and in the absence of other arguments concerning the 
determination of injury, the provisional findings laid down in recitals 28 to 50 of 
the provisional duty Regulation, according to which the Community industry has 
suffered material injury, are hereby confirmed. 
G. CAUSATION 
(23) In order to show that the injury suffered had not been caused by the dumped 
imports subject to the current investigation, the exporting producers brought 
forward three main other potential causes of injury: pressure of Chinese imports, 
the particular situation of the German producer and certain alleged changes in the 
pattern of consumption. 
1) Impact of Chinese imports 
(24) The exporting producers argued that the overwhelming cause of injury was 
Chinese imports. 
In this respect, it should be noted that the Chinese imports have been countered 
by a definitive anti-dumping measure imposed in November 1994 and virtually 
ceased after 1994. The Chinese imports could not, since then, be regarded as a 
cause of the injury experienced by the Community industry, particularly 
noticeable at the end of the five year period examined for the assessment of 
injury, i.e. during the period 1 April 1996 to 31 March 1997. 
10 
2) Competitiveness of the Community industry /self-inflicted injury 
(25) It was alleged that one of the complainants, the German producer, is inefficient 
and undercuts its competitor's prices on the Community market. 
In this respect it should be noted that the findings of substantial undercutting by 
Ukrainian and Indian exports were based on data including sales prices of the 
German producer. It was therefore confirmed by the investigation that, contrary 
to the allegation made, the Indian and Ukrainian exporting producers' prices 
undercut in fact the average Community industry's price. 
In addition, while it is a mere assumption that the current restructuring is in itself 
a proof of inefficiency of the Community producer concerned, it was established 
that the dumped imports weakened the position of this producer and, in fact, 
impeded the improvement of its economic situation. 
3) Changes in the pattern of consumption 
(26) The exporting producers argued that the injury suffered was also due to a change 
in the pattern of consumption resulting from competition from emergent 
substitute products. 
As regards substitute products, it should be recalled that potassium permanganate 
is mainly used for potable water treatment, wastewater treatment, chemical and 
pharmaceutical manufacture, metal refining and disinfectant. Four substances 
were put forward as emergent substitute products to potassium permanganate: 
sodium dichromate, mono potassium persulphate, ozone and hydrogen peroxide. 
II 
The first three products mentioned above, even if sold in significant quantities on 
the Indian market, are still marginal on the Community market. Sodium 
dichromate is not in use in the Community due to its cancerogenic characteristics. 
Mono-potassium persulphate is a chemical product totally unknown in the water-
treatment sector in the Community and only marginally used in other 
applications. Ozone can be potentially seen as a substitute product to potassium 
permanganate in water treatment. However, use of this product is, for the 
moment, limited, and cannot be considered to have had a significant impact on 
the Community potassium permanganate market and the situation of the 
Community industry. Finally, hydrogen peroxide cannot be considered as an 
emergent product because it has been used as an industrial oxidiser for as long as 
potassium permanganate and did not gain importance at the expense of potassium 
permanganate. 
It is therefore considered that none of these alleged substitute products have 
significantly affected the pattern of consumption of the product concerned. 
Accordingly, the alleged emergence of such products cannot be construed as a 
significant alternative source of injury to the Community industry. 
4) Conclusion on causation 
(27) None of the above factors can be considered to have an impact such as to break 
the causal link between the dumped imports and the injury suffered by the 
Community industry in this case. Therefore, the provisional findings concerning 
causation, as set out in recitals 51 to 72 of the provisional duty Regulation, are 
hereby confirmed. 
12 
H. COMMUNITY INTEREST 
(28) The only comments submitted on this issue were in respect of the Community 
industry's interest in seeing the dumping practices counteracted. 
1) Interest of the Community industry 
(29) In this respect, it was argued that the imposition of anti-dumping duties would be 
against the interests of the German producer, which was allegedly reluctant to 
support the current anti-dumping proceeding as anti-dumping measures would 
serve only the Spanish producer because of its allegedly dominating position. 
This argument was not supported by any evidence. The German producer is a 
complainant, which co-operated fully in the investigation and did not make any 
indication that it would no longer support the current anti-dumping proceeding. 
Furthermore, as noted in the provisional duty Regulation, in the absence of 
measures, the existence of the Community industry as a whole would ultimately 
be at risk. Moreover, given the price sensitivity of the product, it is likely that the 
measure would, to a large extent, equally help the German producer to obtain a 
more favourable market position. In any event, anti-dumping measures are not 
designed to prevent competition on the Community market. Rather, their purpose 
is to allow Community producers to compete on a level playing field with 
imports in the Community. 
13 
2) Conclusion on Community interest 
(30) It is therefore confirmed that there are no compelling reasons not to take action 
against the injurious dumping found. Accordingly, the findings concerning 
Community interest, as set out in recitals 73 to 86 of the provisional duty 
Regulation, are hereby confirmed. 
I. DEFINITIVE MEASURES 
1) Injury elimination level 
(31) As no comments, other than those concerning the need for adjustment to the 
export price, requested by the Ukrainian exporting producer in order to take into 
account its special relationship with its sole importer in the Community (see 
recital 17 of the present Regulation), were received with regard to the 
methodology used in calculating the injury elimination level, the findings, as set 
out in recitals 88 to 90 of the provisional duty Regulation, are hereby confirmed. 
2) Form of duty 
(32) The provisional measures were imposed in the form of a variable duty based on 
minimum prices. The Ukrainian exporting producer requested that the minimum 
price concerning the Ukraine should be set at the same level as the minimum 
price applicable to imports from India. 
14 
As indicated in recitals 11, 14 and 93 of the provisional duty Regulation, this 
situation arose from the following: 
Although both minimum prices were based on the domestic prices of the Indian 
producer, the Indian minimum price was the weighted average of the lower price 
for potassium permanganate with a purity below 99% and the higher price for 
potassium permanganate with a minimum purity of 99% while the Ukrainian 
minimum price equalled the price for potassium permanganate with a minimum 
purity of 99% since this country only exports this grade. 
Given this factual background, the request made by the Ukrainian exporting 
producer could not be granted as the difference in minimum prices reflected a 
difference in the exported product types concerned. However, in view of the 
different existing product types it was examined whether the use of different 
minimum prices for India and the Ukraine might result in a discriminatory 
treatment. It was also examined whether the use of this form of anti-dumping 
measure was appropriate with a view to removing the injurious effect of dumping 
for all the different types in which the product concerned exists. 
15 
In this respect it is clear that if in the future both countries were to export 
potassium permanganate with a minimum purity of 99% exclusively, the Indian 
exporting producer would benefit without justification from a lower minimum 
price compared to the minimum price established for the Ukrainian exporting 
producer and that the anti-dumping measure imposed would not ensure that the 
effect of dumping would be removed. 
Such non desirable potential effects outweigh the arguments which motivated at 
the provisional stage the decision to depart from the usual form of anti-dumping 
duties. Accordingly, the definitive anti-dumping duty should take the form of an 
ad valorem duty. 
3) Level of duty 
(33) Since, for each country concerned, the injury elimination margin established is 
higher than the dumping margin, the definitive anti-dumping duty should be 
based on the respective dumping margins, namely 5.6% and 36.2% for India and 
the Ukraine respectively. 
J. COLLECTION OF THE PROVISIONAL DUTY 
(34) Given the magnitude of the injury suffered, the amounts secured by way of 
provisional anti-dumping duty, under Regulation (EC) No 178/98, should be 
definitively collected to the extent of the amount of the definitive duties imposed, 
HAS ADOPTED THIS REGULATION: 
Article J 
1. A definitive anti-dumping duty is hereby imposed on imports of potassium 
permanganate falling within CN code 2841 61 00 originating in India and the 
Ukraine. 
2. The rate of the definitive anti-dumping duty applicable to the net, free-at-
Community-frontier price, before duty, shall be: 
- 5.6% for potassium permanganate originating in India, 
- 36.2% for potassium permanganate originating in the Ukraine. 
3. Unless otherwise specified, the provisions in force concerning customs duties 
shall apply. 
17 
Article 2 
The amounts secured by way of the provisional anti-dumping duty imposed pursuant 
to Regulation (EC) No 178/98 shall be definitively collected at the level of the duties 
definitively imposed on imports of potassium permanganate originating in India and 
the Ukraine. 
The collection shall be limited to the amounts secured. In addition, the amounts 
secured in excess of the definitive antidumping duties shall be released. 
Article 3 
This Regulation shall enter into force on the day following 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. 
Done at Brussels, 1998. 
For the Council 
The President 
18 
ISSN 0254-1475 
COM(98) 382 final 
DOCUMENTS 
EN 02 11 10 
Catalogue number : CB-CO-98-395-EN-C 
ISBN 92-78-37272-2 
Office for Official Publications of the European Communities 
L-2985 Luxembourg 
• >?