COMMISSION OF THE EUROPEAN COMMUNITIES 
COM(94) 30 final 
Brussels, 09.03.1994 
Proposal for a 
COUNCIL REGULATION (EC) 
imposing a definitive anti-dumping duty on imports of silicon carbide, originating in 
the People's Republic of China, Poland, the Russian Federation and Ukraine 
(presented by the Commission) 
Explanatory Memorandum 
By Decision 86/497/EEC, the Commission accepted in October 1986 
price undertakings offered by exporters in connection with the 
anti-dumping proceeding concerning imports of silicon carbide 
originating in Norway, the People's Republic of China, Poland and 
the former USSR. 
In 1991 the Commission received a request for a review of these 
measures under Article 15 of the basic anti-dumping regulation 
(Council Regulation 2423/88), lodged by the European Chemical 
Industry Council (CEFIC), and subsequently announced a review by a 
notice published in official Journal No C 279 of 26.10.1991. 
The review investigation revealed that, notwithstanding the 
measures in force, imports of silicon carbide originating in China, 
Poland, the Russian Federation and Ukraine were dumped and were 
continuing to cause injury to the Community industry. 
Imports from Norway were found neither to be dumped nor causing 
injury. It was also found that the lapsing of the existing measures 
with regard to Norwegian exporters would not lead to an imminent 
recurrence of injurious dumping. 
* With regard to the former USSR, imports of silicon carbide during 
the period under investigation originated only in the Russian 
Federation and Ukraine. The anti-dumping proceeding concerning the 
other former USSR Republics is consequently terminated. 
In the light of the investigation findings it is considered in the 
interest of the Community to take measures in the form of the 
imposition of an anti-dumping duty. 
The following rates of duty are proposed: 
China 52.6% 
Poland 8.3% 
Russian Federation 23.3% 
Ukraine 23.3% 
The duty for the Russian Federation would be a residual duty as the 
sole Russian exporter, together with the Russian Government, have 
offered undertakings which the Commission considers acceptable. 
It is therefore proposed that the Council imposes a definitive 
anti-dumping duty on imports of silicon carbide originating in the 
People's Republic of China, Poland, the Russian Federation and 
Ukraine. 
Proposal for a 
COUNCIL REGULATION (EC) 
imposing a definitive anti-dumping duty on imports of silicon carbide, originating in 
the People's Republic of China, Poland, the Russian Federation and Ukraine 
THE COUNCIL OF THE EUROPEAN UNION, 
Having regard to the Treaty establishing the European Community, 
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(,), and in particular Articles 12, 14 and 15 thereof, 
Having regard to the proposal submitted by the Commission after consultation within the 
Advisory Committee, 
Whereas: 
A. PROCEDURE 
(1) In October 1986, the Commission, by Decision 86/497/EEC(2), accepted price 
undertakings offered by the exporters in Norway, the People's Republic of China 
(hereinafter referred to as "China"), Poland and the former USSR, in connection with 
the anti-dumping proceeding concerning imports of silicon carbide. The measures 
concerning Norway were suspended by Council Regulation (EC) No 5/94(3) with effect 
from 1 January 1994. 
(2) Following the publication in April I991(4) of a notice of the impending expiry of the 
measures in force, the Commission received a request for a review lodged by the 
European Chemical Industry Council (CEFIC), on behalf of producers allegedly 
representing a major part of total Community production of silicon carbide. 
(i) 
CO 
(3) 
(4) OJ No L 209, 2 8.1988, p. I. 
OJ No L 287, 10 10.1986, p. 25. 
OJ No L 3, 5 I 1994, p. 1. 
OJ No C 100, 17.4.1991, p. 17. 
Subsequently, in a notice published in the Official Journal of the European 
Communities'^, the Commission announced a review of the anti-dumping measures 
in force. 
(3) The Commission notified the exporters and importers known to be concerned, the 
representatives of the exporting countries and the complainant Community producers, 
and gave the parties directly concerned the opportunity to make their views known in 
writing and to request a hearing. 
(4) All complainant Community producers replied to the questionnaire and made their 
views known in writing. CEFIC requested and was granted a hearing by the 
Commission. 
(5) The Polish exporter, Intervis Co. Ltd, Warsaw, replied to the questionnaire and made 
its views known in writing. The Norwegian exporters listed below replied to the 
questionnaire only in relation to their export transactions covered by the measures in 
force. Three Chinese corporations, the China Minerals Import and Export Corporation, 
the China Abrasives Export Corporation and the China Metallurgical Import and 
Export Corporation, Jiangu Branch, representing a minor portion of total imports of 
silicon carbide originating in China, replied to the questionnaire. Three export 
organizations of the former USSR were sent questionnaires, but did not reply. 
The original investigation covered the whole of the former USSR. Since information 
at the disposal of the Commission indicates that the silicon carbide concerned 
originates only in the Russian Federation (herinafter referred to as "Russia") and 
Ukraine, this review investigation is limited to imports of silicon carbide originating 
in these two countries of the former USSR. 
(6) Four importers replied to the questionnaire. 
(7) The Commission sought and verified all information it deemed necessary for the 
purposes of a determination and carried out investigations at the premises of the 
following companies: 
(5) OJ No C 279, 26.10.1991, p. II. 
- complainant Community producers: 
- Pechiney Electrometallurgie (France) 
- Elektroschmelzwerk Kempten GmbH (Germany) 
- Samatec, Societâ Abrasivi e Materiali Ceramics S.A. (Italy) 
- Navarro SA (Spain) 
- producers/exporters: 
- Arendal Smelteverk AS. (Norway) 
- Norton AS. (Norway) 
- Orkla-Exolon A.S. (Norway) 
- importers: 
- Frank and Schulte GmbH (Germany) 
- Ferrocarbon GmbH (Germany) 
- reference country: 
- Exolon ESK Company, Tonawanda, USA 
- Norton Company, Worchestef, USA 
(8) The investigation of dumping covered the period from 1 Juty 1990 lo 30 June 1991 
(investigation period). 
(9) Owing to the complexity of the investigation and the volume of data gathered, the 
investigation could not be concluded within the normal time limit of ©ne year provided 
for in Article 7(9)(a) of Regulation (EEC) No 2423/88 (hereinafter referred to as "the 
basic Regulation"). 
B. PRODUCT UN0ER <3DN!^DÈRAT»0N AM» UB®. PRODUCT 
(10) The product covered by the complaint and for which the review investigation was 
initiated is silicon carbide falling within CN code 2849 20 00. It is identical to the 
product which was the subject of the previous investigation and for which price 
undertakings were accepted. 
(11) The production process of silicon carbide is such that output automatically comprises 
a variety of qualities of silicon carbide. These qualities can be segregated into two 
main grades, crystalline and metallurgical. The crystalline grade is normally used, 
depending on the quality, in the manufacture of abrasive tools, grinding wheels, high 
quality refractory products, ceramics, plastic materials etc., while the metallurgical 
grade is normally used in foundry and blast furnace operations as a silicon carrier. 
The various qualities of silicon carbide do not entail any significant differences in 
basic physical characteristics, although in use, differences occur. 
Given that both main grades result from the same production process - one cannot be 
produced without the other - and that the metallurgical grade can technically be 
replaced by the crystalline grade, both grades of silicon carbide and their different 
qualities should be considered as forming one product for the purpose of this 
proceeding. 
(12) The investigation showed that the product produced and sold by the Community 
producers on the Community market is identical in its particular characteristics to the 
silicon carbide imported from the five countries in question. It should therefore be 
considered as a like product within the meaning of Article 2(12) of the 
basic Regulation. 
C. COMMUNITY INDUSTRY 
(13) The complainant producers continue to manufacture more than 90% of Community 
output of silicon carbide. It was therefore considered that these producers constitute 
a major proportion of total Community production of this product. 
Account was taken of the fact that some Community producers imported small 
quantities of silicon carbide from the countries under investigation. Since these 
imports were test purchases in order to analyse the products produced by competitors 
and represented, in any event, negligible quantities, there appears no reason to exclude 
these Community producers from the "Community industry", in accordance with 
Article 4(5) of the basic Regulation. Indeed, these importing Community producers 
were neither participating in, nor benefiting from nor shielded from dumping by the 
countries concerned. 
D. THE PRESENT SITUATION IN THE COMMUNITY MARKET 
(14) In order to establish whether the expiry of the measures in force would lead again to 
dumping and injury or threat of injury, it was first necessary to examine the present 
economic situation of the Community industry. 
(a) Production, capacity utilization and stocks 
(15) The production of silicon carbide by the Community industry showed a brief upturn 
between 1988 and 1989, from 101 500 tonnes to 107 500 tonnes, but then gradually 
declined to 101 700 tonnes in 1990 and to 95 000 tonnes during the investigation 
period. This represented a decrease of 6.4% when compared to 1988, 11.6% when 
compared to 1989 and 6.5% when compared to 1990. 
Since the production capacity of the Community industry remained stable at 129 000 
tonnes, its utilization rate which stood at 79% in 1988 increased to 83% in 1989 to 
decline to 74% in the investigation period. 
During this period the stocks of the Community industry rose gradually from 17 000 
tonnes to 20 500 tonnes, i.e. by 20 6% 
(b) Sales 
(16) Between 1988 and the end of the investigation period, the quantity of silicon carbide 
sold on the Community market by the Community industry gradually decreased by 
15% from 93 419 tonnes to 79 385 tonnes. 
(c) Profitability 
(17) It was found that the Community industry on the whole suffered a considerable 
deterioration in profitability after 1988. In 1990, although some Community producers 
were still profitable, the industry on average incurred losses, while during the 
investigation period all Community producers incurred losses. 
(d) Employment 
(18) The workforce of the complainant producers has generally declined and one plant in 
Italy was closed during the investigation period. 
(e) Community consumption 
(19) Between 1988 and the investigation period the total estimated consumption in the 
Community of the product concerned increased from 152 977 tonnes to 
185 400 tonnes, i.e. an increase of 21% since 1988. 
(f) Market share of the Community industry 
(20) The Community market share of the Community industry recovered as a result of the 
anti-dumping measures adopted in 1986 from 52.5% in 1984 to 61.1% in 1988. 
However, after 1988 this market share declined to 42.8% at the end of the 
investigation period. 
(g) Conclusion 
(21) It was accordingly concluded that, in spite of the price undertakings in force, the 
Community industry continues to show clear signs of economic difficulties. This 
situation has consistently deteriorated since 1988, manifested on the one hand by a 
decline of production, capacity utilisation and sales, and, on the other, by increasing 
stocks, loss of employment,financial losses and a declining market share 
notwithstanding the increase in Community consumption. 
E. THE BEHAVIOUR OF THE EXPORTERS CONCERNED 
(22) It was also necessary to examine the behaviour of the exporters concerned. 
(a) Volume and market share of imports from the exporting countries concerned 
(23) The volume of Norwegian imports increased from 42 035 tonnes to 49 185 tonnes 
between 1988 and 1989, but decreased thereafter to 45 288 tonnes in the investigation 
period. The market share of the Norwegian imports increased slightly between 1988 
and 1989 from 27.5% to 28.8%, but eroded over 1990 to 25.7% and in the 
investigation period to 24.4%. 
Imports from China increased between 1988 and the investigation period from 
1 758 tonnes to 28 295 tonnes; imports from Poland rose over the same period from 
1 276 tonnes to 3 497 tonnes and from Russia and Ukraine from 5 078 tonnes to 
12 921 tonnes. This corresponds to an increase in market share over the same period 
from 1.1% to 15 3% for China, 0.8% to 1.9% for Poland and from 3.3% to 7% for 
Russia and Ukraine. The total volume of imports from China, Poland, Russia and 
Ukraine has accordingly increased by more than four and a half times in this period. 
The market share of the four countries taken together increased from 5.2% to 24.2% 
between 1988 and the investigation period. 
The volume of imports from China, Norway, Poland, Russia and Ukraine has, taken 
together, increased from 50 147 tonnes in 1988 to 90 001 tonnes in the investigation 
period corresponding to an increase in market share from 32.7% to 48.6%. 
(b) Prices 
(24) It was investigated whether the exporting producers were undercutting the prices of 
the Community producers during the investigation period. A price comparison was 
made on the basis of sales by both the Community industry and the exporters to 
unrelated customers at the same level of trade on the most important markets of the 
Community. In order to ensure a fair comparison, prices of similar qualities were 
compared. 
This comparison showed significant price undercutting on the part of the exporters in 
all countries involved with the exception of Norway. Norwegian prices were found 
to oscillate around the prices charged by the Community industry. 
For die Polish exporter, the Community producers' prices were found to be undercut 
by margins of up to 29%. Exports from Russia and Ukraine were undercutting 
Community producers' prices by margins from 23% to 49%, and exports from China 
by margins from 50% to 71%. 
(c) Price undertakings 
(25) This price examination also revealed that the exports from China, Russia and Ukraine 
were consistently sold in violation of the undertakings agreed in the previous 
proceeding with the Commission. Although the Polish exporter was found to be 
undercutting, it did not violate its price undertaking. The Norwegian exporters also 
respected their price undertakings. 
(d) Conclusion 
(26) The increased market penetration of imports from China, Poland, Russia and Ukraine, 
taken together in combination with the price undercutting established for these 
countries and the breach of the price undertakings by all but Norway and Poland, led 
to the conclusion that it was necessary to examine whether dumping is occurring 
which contributed to the deteriorated situation of the Community industry and 
whether the expiry of protective measures would lead to a recurrence of dumping 
and injury. 
F. RECURRENCE OF DUMPING 
(I) Reference country 
(27) The countries covered by this proceeding, with the exception of Norway, were, during 
the period of investigation, non-market economy countries (hereinafter referred to as 
"NMEs"). Normal value for these NMEs had therefore to be based on data obtained 
in a market economy country (in accordance with Article 2(5) of the basic 
Regulation). Interested parties suggested several countries including Norway as an 
analogue market for that purpose. Since the Norwegian exporters did not supply 
information relating to domestic prices, cost of production or export prices for all 
grades of the product concerned, Norway could not be used. 
It was determined that the market of the United States of America (hereinafter referred 
to as "the US market") would in this respect be an appropriate and not unreasonable 
choice due to the easy access to raw materials, the availability of competitively priced 
energy, its open and competitive nature and the fact that, in terms of volume and range 
of qualities of silicon carbide, it is considered to be representative in comparison with 
the exports from each individual NME. 
Furthermore, the product manufactured in the USA has the same basic physical and 
chemical characteristics as the product manufactured by all NMEs concerned and can 
therefore be considered a like product. 
(II) Normal value 
(a) NMEs 
(28) Normal value was determined on the basis of prices in the ordinary course of trade at 
which the silicon carbide was actually sold for consumption on the US market. All 
sales transactions were to unrelated purchasers and involved quantities considered to 
be representative. 
Account was taken of the fact that the companies investigated in the reference market 
were directly or indirectly related to certain silicon carbide producers in the 
Community or in Norway. It was examined whether their relationship had an influence 
on the determination of normal value. Since normal value was determined on the basis 
of sales prices to independent customers on the US market and these prices were 
subject to normal competitive forces, it was concluded that the relationship had no 
influence on the normal value thus determined. 
(b) Norway 
(29) No normal value based on prices or costs in Norway could be established as the 
Norwegian producers did not fully cooperate. In view of the similarity of the 
production processes, costs of raw materials, in particular energy costs, and other 
economic circumstances, between Norway and the USA for this product, and the fact 
that in both countries producers are operating on a competitive market, it was 
considered that the prices for this product in the USA constituted the best facts 
available for prices in Norway. 
Normal value for all qualities was therefore established, pursuant to Article 2(3)(a) of 
the basic Regulation, on the basis of the weighted average of the US sales prices. The 
information concerning the production costs of silicon carbide in the USA - increased 
by a reasonable margin for profit (as explained in recital 49) - confirmed the 
reasonableness of the use of the US sales price on the US market. 
11 
For the qualities covered by the undertakings accepted from the Norwegian exporters 
concerned, separate normal values were established on the basis of the weighted 
average of the sales prices on the US market of the corresponding qualities. 
(Ill) Export prices 
(a) Poland 
(30) Exports by the Polish exporting producer were made directly to independent importers 
in the Community. The export prices were therefore determined on the basis of prices 
actually paid or payable for the products sold. 
(b) China 
(31) The export volume of the cooperating Chinese export corporations represented 22% 
of total Chinese silicon carbide imports into the Community during the investigation 
period. It was considered whether individual company findings should be made for the 
three export corporations referred to in recital 5. Since they are all State-owned 
corporations, individual determinations were not made in conformity with the 
established practice of the institutions, especially since the State can at any time 
interfere in their economic operations. In addition, the percentage of 22% was deemed 
to be too small to be representative of total Chinese silicon carbide exports. Export 
prices of the Chinese export sales were therefore based on the facts available in 
accordance with Article 7(7)(b) of the basic Regulation. Consequently, the data 
supplied by Eurostat was used, from which all costs incurred between the Chinese port 
of loading and CIF Community frontier were deducted. 
(c) Norway 
(32) Since the Norwegian producers supplied information for only part of their exports, an 
average export price for silicon carbide from Norway, irrespective of quality, was 
established on the basis of Eurostat figures. 
12 
(d) Russia and Ukraine 
(33) The exporters in Russia and Ukraine, did not cooperate: export prices had therefore 
to be based on the facts available. In this respect, export prices for Russia and Ukraine 
were established on the basis of purchase prices of an independent importer which was 
considered appropriate since it imported during the investigation period more than 
50% of total imports of silicon carbide originating in the countries concerned. These 
purchase prices were at franco destination level. Freight and insurance costs incurred 
were deducted in order to establish an ex-national border price. The data supplied by 
this importer did not permit a distinction to be made between the silicon carbide 
originating in Russia and Ukraine. 
(IV) Comparison 
(34) For all countries, with the exception of China and Norway, the normal value was 
compared with the export price for comparable qualities, transaction-by-transaction, 
and on an ex-works basis. For the NMEs, ex-factory was taken as ex-national border 
in accordance with normal practice for these countries. No adjustments were claimed 
or deemed necessary in respect of different levels of trade (Article 2(9)(a) of the basic 
Regulation) since the investigation showed that no different price patterns existed on 
the reference market for different types of customers of silicon carbide. 
For the product originating in Russia and Ukraine an adjustment based on detailed 
information supplied by the importer referred to in recital 33 was made to the normal 
value in order to take account of the difference in physical characteristics in 
accordance with Article 2(9)(a) of the basic Regulation. 
(35) The average price of all Norwegian export transactions of silicon carbide, based on 
Eurostat figures, was compared on an ex-works basis with the normal value for silicon 
carbide established on the basis of the average price of all transactions on the US 
market, all qualities taken together. 
The export prices for certain qualities reported under the Norwegian producers' 
undertakings were also compared with the sales prices on the US market for the 
comparable qualities. These findings confirmed the results found in the comparison 
of all Norwegian export transactions. 
13 
(36) In the case of China, the three exporters which replied to the Commission's 
questionnaire claimed several adjustments for differences in physical characteristics 
and certain selling expenses. Since, as previously mentioned, these exporters were 
deemed to be unrepresentative of total Chinese exports of silicon carbide to the 
Community, it was not possible to determine on the basis of the evidence available 
whether such adjustments were applicable to all exports to the Community. However, 
since it became known from different sources during the investigation that China 
exports predominantly metallurgical silicon carbide, it was considered that in applying 
the provisions of Article 7(7)(b) of the basic Regulation (facts available), it would be 
unreasonable to use an average normal value based on both crystalline and 
metallurgical grades. A normal value based on the average price for metallurgical 
grade only was therefore used . The comparison was made between this normal value 
and the export price as determined above. In so doing, adjustments warranted for 
differences affecting price comparability, in respect of the volume of exports by the 
three Chinese cooperating exporters, have been taken into account. 
Claims for adjustments for differences in cost factors, such as labour, between the US 
producers on the one hand and the Chinese producers on the other were rejected since 
no adjustments other than those resulting from comparative natural advantages can be 
granted. Cost differences, if any, due to the economic system existing in the exporting 
country cannot be taken into consideration as this would negate the purpose of 
Article 2(5) of the basic Regulation of determining normal value on the basis of prices 
or costs in a market economy; however, cost differences resulting from comparative 
natural advantages are not due to the economic system existing in an 
exporting country. 
(V) Dumping margins 
(37) These comparisons showed the following weighted average dumping margins, 
expressed as a percentage of the free-at-Community frontier price: 
China: 72.5% 
Norwegian exporting producers: 0.0% 
Poland: 8.3% 
Russia. 23.3% 
Ukraine: 23.3% 
14 
G. RECURRENCE OF INJURY 
(38) In the light of the above analysis and in order to assess the effect of the expiry of 
measures in force, the following was considered: 
(I) Norway 
(39) Although the Norwegian exporters did not fully cooperate, evidence available 
clearly indicates that the Norwegian product is mostly present in the high quality 
market segment, where higher prices prevail. 
In the light of the past pricing behaviour of Norwegian producers which has led 
to prices being kept generally in line with those of Community producers, even at 
the expense of loss of market share, it appeared unlikely that the expiry of the 
undertakings would lead to an imminent recurrence of dumped imports and injury 
caused by Norwegian exporters. 
(II) China, Poland, Russia and Ukraine 
(40) Exporters in these countries sold silicon carbide at high undercutting prices to the 
Community in increasing quantities, without respecting, except for the Polish 
exporter, the undertaking conditions agreed with the Commission. 
Since these imports continued to injure the Community industry, it can be expected 
that the expiry of measures would only lead to a further deterioration of an already 
weakened Community industry. 
(III) Effect of the cumulated, low-priced imports 
(41) For this examination, it was considered appropriate to cumulate the imports from 
China, Poland, Russia and Ukraine because the exporters in these countries followed 
largely the same low-pricing behaviour and the imports have the same basic 
physical characteristics, are interchangeable, have the same channels of distribution 
and were sold in the same geographical market during the same period. 
15 
(42) In considering the relationship between these low-priced imports and the weak 
situation of the Community industry, it was found that the increase in volume and 
market share of these imports in combination with their undercutting prices, 
coincided with the deterioration of the situation of the Community industry. 
Since this is a price-sensitive product in a transparent market which consists mainly 
of industrial users, sales at low prices inevitably have substitution effects as 
customers choose to be supplied at the lowest price offered. It was therefore 
concluded that these low-priced imports can be clearly associated with the 
deteriorating situation of the Community industry. 
(IV) Effect of other factors 
(43) It was examined whether factors, other than the low-priced imports from these four 
countries, might have led to or contributed to the weak situation of the Community 
industry and especially whether imports from countries other than the four 
mentioned, may have contributed to this situation. This examination was based on 
"Eurostat" figures. 
(a) Norway 
(44) Regarding imports from Norway, it has to be noted that Norwegian prices of silicon 
carbide imported into the Community were in general in line with those of the 
Communtiy producers. Furthermore, the Norwegian market share has declined from 
1989 to the investigation period. Therefore, it was considered unlikely that 
Norwegian imports have contributed to the deteriorating situation of the 
Community industry. 
(b) Other third countries 
(45) A certain quantity of imports (7.7% market share during the investigation period) 
originates from third countries other than Norway. It was found that prices of 
imports from these countries were on average below those charged by the 
Community producers. 
No evidence has been supplied to the Commission as to whether these prices were 
low in respect of low-quality silicon carbide or whether these products were actually 
being sold at dumped prices. 
Conclusion 
(46) It was considered arguendo that, even if the imports from other countries had 
contributed to the difficult state of the Community industry, it would not affect the 
conclusion that the cumulated imports from the four countries in question taken in 
isolation have been a cause of this difficult state. 
(V) Conclusion on recurrence of injury 
(47) In the light of the new dumping and injury findings, it was concluded that a 
continuation of measures for all countries except Norway, would be warranted but 
that the nature of such measures should be reconsidered in the light of the new 
dumping and injury findings. With regard to Norway, the findings of no dumping 
for all grades of silicon carbide exported to the Community and not only for those 
grades covered by the undertakings confirms that the pricing behaviour of the 
Norwegian exporters is such that there is nothing to suggest that the expiry of the 
measures would lead to an imminent recurrence of injury caused by dumping. 
H. COMMUNITY INTEREST 
(48) The purpose of anti-dumping measures is, in general, to eliminate distortion of 
competition arising from dumping practices and thus to re-establish open and fair 
competition on the Community market. In considering the Community interest, 
account has been taken of the effectiveness of the existing measures in addition to 
the interest of the Community silicon carbide industry, the users of silicon carbide 
and the final consumers of the end product. In this respect it is also recalled that 
in the previous investigation, the adoption of measures was considered to be in the 
interest of the Community. 
Leaving the Community industry without adequate protection against the unfair 
competition as established would add to the difficulties of this industry and could 
lead to its disappearance with the consequent negative effect on employment and 
investment. One plant in Italy had already closed during the investigation period and 
17 
a further plant in France has subsequently had to close Such closures, resulting in 
reduced competition for the supply of silicon carbide, have a negative impact on 
users. As far as these purchasers of silicon carbide are concerned, it may be argued 
that they could derive some benefit from buying silicon carbide at dumped prices. 
Any such benefit, however, would be minimal, since the silicon carbide in question 
accounts for only a fraction of the price of most end-products. 
In these circumstances, it is in the Community interest to maintain definitive anti­
dumping measures to eliminate the injurious effects of dumped imports and that 
these measures should take the form of anti-dumping duties. 
I. DUTY 
(49) When calculating the amount of duty necessary to provide adequate protection to 
the Community industry from continued injurious dumping, it was considered that 
any measures should allow the Community industry to cover its costs of production 
and to obtain a reasonable profit. 
In this respect and based on the findings in the reference country, it was found that 
a profit margin of 5% of the cost of production for this sector could be regarded as 
an appropriate minimum taking into account the need for long-term investment. 
(50) In order to calculate the amount of duty, a price level was established which would 
permit the Community industry to achieve this result. 
Since silicon carbide consists of two main grades, chrystalline and metallurgical, 
two different price levels were calculated, consisting of the weighted average cost 
of production of the Community producers for each main grade and the profit 
margin. 
(51) It was considered that the duty should cover the difference between this price and 
the actual selling prices of the exporters in the Community. 
(52) In order to determine the level of the duty, price increases thus established have 
been expressed as a percentage of the weighted average free-at-Community frontier 
value of the imported goods. 
18 
(53) For Russia and Ukraine, an injury margin of 51.1% was found. Since this margin 
was higher than the dumping margin, the rate of duty should be established on the 
basis of the latter. 
(54) The free-at-Community-frontier price established for exports originating in China 
was compared with the injury level determined for the Community industry in 
respect of metallurgical grade silicon carbide. This comparison results in an injury 
margin of 52.6%, which is lower than the dumping margin. Therefore, the duty 
should be established on the basis of the injury margin. 
(55) For Poland, an injury margin of 27% was found. Since this margin is higher than 
the dumping margin determined, a duty should be established on the basis of the 
latter. 
The undertaking accepted in 1986 from the only Polish exporter is no longer apt to 
prevent injury. This exporter has not offered a revised undertaking, despite having 
been given the opportunity to do so by the Commission. 
Notwithstanding the acceptance of an undertaking from the Russian government (see 
recital 56), a residual duty should be imposed on imports originating in Russia in 
view of the rapid changes taking place in that country's economic system which 
may lead to the emergence of new producers and exporters of silicon carbide 
operating independently of the State. 
Undertakings 
(56) Having been informed of the essential facts and considerations on the basis of 
which it was intended to recommend the imposition of definitive duties, certain 
exporters in China and Russia offered undertakings. 
For China, these exporters are those mentioned in recital 5 which responded to the 
Commission's questionnaire. They offered undertakings in respect of their 
individual circumstances as to dumping and injury caused thereby. It has been 
deemed inappropriate to determine individual company findings for these State-
owned corporations for the reasons set out in recital 31. The Commission has 
therefore considered the undertakings offered by the Chinese exporters unacceptable 
and have informed the three Chinese exporters accordingly. 
19 
The Russian government, in conjunction with the State-trading organization 
V/O Stankoimport, offered undertakings which would remedy the injurious effects 
of the dumped exports. The Commission consulted the Advisory Committee on 
acceptance of these undertakings and, since some objections were raised, sent a 
report on these consultations to the Council. These undertakings were accepted by 
ftC Commission Decision ^5/... EC*, 
HAS ADOPTED THIS REGULATION: 
Article 1 
1. A definitive anti-dumping duty is hereby imposed on imports of silicon carbide falling 
within CN Code 2849 20 00 originating in the People's Republic of China, Poland, the 
Russian Federation and Ukraine. 
However, the duty shall not apply to silicon carbide exported by V/O Stankoimport, 
Moscow, Russia (Taric additional code 8746). 
2. The rate of the duty applicable to the net, free-at-Community-frontier price, before duty, 
shall be as follows: 
Country Rate of duty (%) Taric additional code 
People's Republic of China 52.6 
Poland 8.3 
The Russian Federation 23.3 8747 
Ukraine 23.3 
3. The provisions in force concerning customs duties shall apply. 
*See page .... of this Official Journal. 
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Article 2 
This Regulation shall enter into force on the day following that 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. 
Done at Brussels, For the Council 
The President 
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ISSN 0254-1475 
COM (94) 30 final 
DOCUMENTS 
EN 11 02 
Catalogue number : CB-CO-94-036-EN-C 
ISBN 92-77-64867-8 
Office for Official Pablications of the European Communities 
1^2985 Luxembourg 
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