COMMISSION OF THE EUROPEAN COMMUNITIES 
Brussels, 12.03 1998 
COM(1998) 148 final 
Proposal for a 
COUNCIL REGULATION (EC) 
amending Regulation (EC) No 2022/95 imposing a definitive anti-dumping duty on 
imports of ammonium nitrate originating in Russia 
(presented by the Commission) 

EXPLANATORY MEMORANDUM 
The Council, by Regulation (EC) No 2022/95', imposed a definitive anti-dumping duty 
on imports of ammonium nitrate originating in Russia. 
The Commission reopened the investigation concerning such imports on 
29 May 19972, pursuant to Article 12 of Council Regulation (EC) No 384/96-\ 
subsequent to the lodging of a complaint by the European Fertilizer Manufacturers 
Association on 14 April 1997. 
The findings of the review investigation show that the definitive duty imposed did not 
lead to sufficient movement in resale prices in the Community within the meaning of 
Article 12 (2) of Regulation (EC) No 384/96. Following the imposition of the duty, it 
was found that the margin of dumping had increased. It is proposed, therefore, to 
change the anti-dumping measure from the minimum import price currently applicable 
to a specific duty per tonne of ECU 26.3, in line with the new findings on export 
prices. 
The Advisory Committee was consulted on 14 January 1998 and declared itself 
unanimously in favour. The Legal Service, the Directorate-General for Industry and 
the Directorate-General for Customs and Indirect Taxation have been consulted and 
have also given their approval in this respect 
1 OJNoL 198. 23.8.1995, p. 1. 
2 OJ No C 162. 29.5.1997, p. 5. 
1 OJ No L 56, 6.3.19%. p. 1. 
1 
COUNCIL REGULATION (EC) No /98 
of 1998 
amending Regulation (EC) No 2022/95 imposing a definitive anti-dumping duty on 
imports of ammonium nitrate originating in Russia 
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 \ as 
amended by Council Regulation (EC) No 2331/96 of 2 December 1996(2), and in particular 
Article 12 thereof, 
Having regard to the proposal submitted by the Commission after consulting the Advisory 
Committee, 
Whereas: 
A. PROCEDURE 
1. Previous measures 
(1) In May 1994, by Commission Decision 94/293/EC , anti-dumping measures were 
adopted with regard to imports of ammonium nitrate originating in Lithuania and Russia, 
following a regional anti-dumping proceeding concerning imports into the United 
Kingdom. Measures were in the form of the acceptance of undertakings which were 
intended to limit exports from each country to the United Kingdom to 100 000 tonnes per 
annum. The undertaking accepted from the Russian authorities was, however, breached 
within the first year of its operation. 
1 OJ No L 56, 6.3.1996, p. 1. 
2 OJ No L 317, 6.12.1996, p. 1. 
3 OJ No L 129, 21.5.1994, p. 24. 
y\ £*. 
(2) In June 1994, a Community-wide anti-dumping investigation concerning imports of 
ammonium nitrate originating in Lithuania and Russia was initiated(4) subsequent to a 
complaint lodged by the European Fertilizer Manufacturers Association (EFMA). 
In August 1995 the Council, by Regulation (EC) No 2022/95(5), imposed a definitive anti­
dumping duty, in the form of a variable duty, on imports of ammonium nitrate 
originating in Russia. The amount of duty was set at the difference between a minimum 
import price of ECU 102.9 per tonne net of product and the net cif price, Community 
frontier before customs clearance, where the latter was lower. The Commission 
simultaneously terminated the regional anti-dumping proceeding in respect of imports of 
ammonium nitrate originating in Russia(6). 
For imports originating in Lithuania, the Community-wide proceeding was terminated 
without measures in view of the findings of the investigation concerning the causation of 
injury(7). However, the undertaking concerning imports into the United Kingdom 
originating in Lithuania, accepted in the framework of the regional anti-dumping 
proceeding, remained in place. 
The investigation that led to the imposition of the Community-wide measures is 
hereinafter referred to as 'the original investigation'. The investigation period of the 
original investigation was from 1 April 1993 to 31 March 1994. 
2. Request for a reopening of the investigation 
(3) In April 1997, EFMA lodged a request pursuant to Article 12 of Council Regulation (EC) 
No 384/96 (hereinafter referred to as 'the basic Regulation') to reopen the investigation 
into imports of ammonium nitrate originating in Russia with a view to examine whether 
the measures had had an effect on resale prices or subsequent selling prices. 
The request was lodged on behalf of Community producers whose collective output of 
ammonium nitrate constitutes a major proportion, as defined by Article 5 (4) of the basic 
4 OJ No C 158, 9.6.1994, p. 3. 
5 OJ No L 198, 23.8.1995, p. 1. 
6 OJ No L 198,23.8.1995, p. 29. 
7 OJ No L 198, 23.8.1995, p. 27. 
Regulation, of the total Community production of the product concerned, that is, by the 
Community industry in the proceeding. 
(4) It was alleged that the imposition of anti-dumping duties on imports of ammonium nitrate 
originating in Russia had led to no movement, or insufficient movement, in resale prices 
or subsequent selling prices in the Community. The information submitted by the 
Community industry contained prima facie evidence to justify the reopening of the 
investigation, consisting of a comparison of the resale price per tonne which should have 
been expected following the imposition of measures (calculated by adding to the 
minimum import price set by Council Regulation (EC) No 2022/95 all costs incurred 
between import and resale) with actual resale prices per tonne in two Member States 
(France and the United Kingdom), which were alleged to account for 82% of the 
consumption of ammonium nitrate in the Community. 
3. Reopening of the investigation 
(5) The evidence submitted in the request was considered sufficient. On 29 May 1997, 
therefore, the Commission announced by a notice published in the Official Journal of the 
European Communities' the reopening of the investigation, pursuant to Article 12 of the 
basic Regulation, concerning the anti-dumping measures applicable to imports of 
ammonium nitrate originating in Russia and commenced the reinvestigation. 
(6) The Commission officially advised the producers/exporters and 
importers/traders/distributors known to be concerned, the representatives of the exporting 
country and the Community producers of the reopening of the investigation.. Interested 
parties were given the opportunity to make their views known in writing and to request a 
hearing. All parties who so requested were granted hearings. Written and oral 
submissions were also received from certain importers/traders/distributors and from 
EFMA and certain of its constituent members. Questionnaires were sent by the 
Commission directly to all producers/exporters and importers/traders/distributors known 
to be concerned. 
8 OJNoC 162,29.5.1997, p. 5. 
(a) Producers/exporters in the country of origin and their related companies 
No replies to the questionnaire were received within the time limit set. One 
producer/exporter replied after the expiry of the time limit, but in a manner which could 
only be considered insufficient. This company was then given the opportunity to rectify 
the deficiencies in its response, which it failed to do. The company was therefore 
informed that it would be considered as non-cooperating and was given the opportunity 
to comment on this decision, in accordance with Article 18 (4) of the basic Regulation. 
The company replied, outside the deadline, that it had supplied non-confidential 
information which should be used by the Commission. The non-confidential information 
already supplied was, however, clearly insufficient for the purposes of the 
reinvestigation. 
(b) Importers/traders/distributors in the Community 
Nine unrelated importers/traders/distributors made themselves known to the Commission 
and responded to the questionnaire. Of these, two subsequently did not cooperate and 
were therefore excluded from the reinvestigation conducted. Both companies were 
informed of this decision and were given an opportunity to comment, in accordance with 
Article 18 (4) of the basic Regulation. 
The Commission carried out investigation visits at the premises of the following 
companies : 
- Unifert France, SA, France 
- SHB Trading Ltd., United Kingdom 
- ConAgra Resources Europe Ltd., United Kingdom 
- Common Market Fertilizers, SA, Belgium 
The three remaining cooperating importers/traders/distributors were not visited by the 
Commission but appropriate account was taken of the information provided in their 
replies. 
(7) The reinvestigation covered the period from 1 April 1996 to 31 March 1997 (hereinafter 
referred to as 'the period of reinvestigation'). 
(8) The reinvestigation exceeded the normal time period of six months provided for in 
Article 12 (4) of the basic Regulation owing to the Commission being hampered in its 
efforts to gather information by the marked lack of cooperation. 
B. PRODUCT UNDER CONSIDERATION 
(9) The product reinvestigated is the same product, originating in Russia, as that concerned 
by the original investigation: i.e. ammonium nitrate, which is a fertiliser produced in 
prill or granular form, currently classifiable within CN codes 3102 30 90 (ammonium 
nitrate, other than in aqueous solution) and 3102 40 90 (mixtures of ammonium nitrate 
with calcium carbonate or other inorganic non-fertilising substances with a nitrogen 
content exceeding 28% by weight). 
C. THE REINVESTIGATION 
1. Cooperation 
(10) No producer/exporter of ammonium nitrate located in Russia - or related 
importer/trader/distributor located within or outside the Community - cooperated with 
the reinvestigation. In addition, as indicated in recital (11) below, little cooperation was 
received from unrelated importers/traders/distributors located within or outside the 
Community. 
Recourse was therefore made to facts available in accordance with Article 18 of the 
basic Regulation. Information received from customs authorities in the United 
Kingdom, from published trade journals, from cooperating 
importers/traders/distributors and from the Community industry was used, where 
appropriate. 
(11) Only 20% of imports into the Community of ammonium nitrate originating in Russia 
during the period of reinvestigation was accounted for by the purchases of cooperating 
companies. Furthermore, a number of cooperating companies were related to non-
cooperators also involved in the trade of ammonium nitrate originating in Russia. 
Despite the fact that this meant the Commission could not be wholly confident as to the 
completeness of the information supplied, it was nonetheless not disregarded, where 
relevant, as it was considered that the deficiencies were not such as to cause undue 
5 
difficulty in arriving at a reasonably accurate finding, in accordance with Article 18 (3) 
of the basic Regulation. In this respect, costs between import and resale verified on-
the-spot at cooperating companies considered to have provided the most detailed 
information were used to calculate the resale price level which could reasonably have 
been expected for the product concerned after the adoption of measures. 
2. Movement of resale prices in the Community 
(12) Pursuant to Article 12 (1) and (2) of the basic Regulation, it was determined whether, 
following the imposition of definitive anti-dumping duties in 1995, the expected 
movement in resale prices in the Community had occurred. In particular, the resale 
price to the first independent buyer which should have been expected during the period 
of reinvestigation (the 'benchmark resale price') was compared with the resale price 
actually found for the same period (the 'actual resale price'). 
(a) Calculation of the benchmark resale price 
(13) In order to calculate the benchmark resale price it was considered appropriate to add to 
the minimum import price established pursuant to the original investigation all costs 
incurred between import and resale plus an amount for profit. 
However, in the absence of any more suitable information, a distinction was made 
between costs associated with imports accounted for by cooperating 
importers/traders/distributors - for which the costs incurred between import and resale 
were verified on-the-spot - and those associated with imports accounted for by non-
cooperators - whose costs were established on the basis of the facts available, in 
accordance with Article 18 of the basic Regulation. 
(14) In order to calculate the costs incurred between import and resale for cooperating 
companies, appropriate amounts for customs duty, handling and ancillary costs, selling, 
general and administrative expenses (including credit costs) and profit were taken into 
consideration, as verified on-the-spot. 
One importer argued, after disclosure of the findings of the reinvestigation, that the 
profitability used did not reflect actual profitability verified on-the-spot. The rate of 
profitability used was reviewed and, after consideration, an appropriate adjustment was 
made. 
(15) For non-cooperators, appropriate amounts for customs duty, handling and ancillary 
costs, product losses, selling, general and administrative expenses (including credit 
costs) and profit were taken into consideration, taking the highest costs found, by 
Member State, for cooperating companies. Due account was taken of the fact that 
imports made into the United Kingdom accounted for by non-cooperating companies 
were primarily made in bulk, as indicated by evidence provided by customs authorities. 
In this respect, the costs of bags and bagging were also included in the calculation of 
costs incurred between import and resale for imports accounted for by non-cooperating 
companies made into the United Kingdom. The amount for profit was determined on 
the basis of information contained in the request for a reinvestigation. 
(16) Weighted average costs incurred between import and resale and profit were added to the 
minimum import price established pursuant to the original investigation (established on 
a cif Community frontier basis duty unpaid) in order to establish the Community 
benchmark resale price, denominated in ECU, for the period of reinvestigation. 
(b) Actual resale price after the imposition of the measures 
(17) The actual resale price to the first independent buyer for all imports into the Community 
of ammonium nitrate originating in Russia during the period of reinvestigation was then 
established. A distinction was made between the actual resale price for imports 
accounted for by cooperating importers/traders/distributors and that calculated for 
imports accounted for by non-cooperators. 
(18) For imports accounted for by cooperating companies, the actual resale price was 
calculated on the basis of information verified on-the-spot. 
(19) For imports accounted for by non-cooperators, the actual resale price was calculated, on 
the basis of the facts available, in accordance with Article 18 of the basic Regulation, on 
a monthly basis for the period of reinvestigation, by reference to market prices 
published in trade journals, on a Member State by Member State basis. In the absence 
of any more suitable information, in order not to reward non-cooperation and in view of 
the fact that the market prices referred to were those for all imported ammonium nitrate 
whilst, according to information received during the course of the reinvestigation, 
Russian ammonium nitrate trades at a lower price than other imported ammonium 
nitrate, the lowest market price published therein was taken. 
(20) Finally, a single weighted average actual resale price, denominated in ECU, was 
calculated for all imports of the product concerned (both made in bulk and bagged) for 
the period of reinvestigation. 
(c) Insufficient movement of resale prices 
(21) The difference between the actual resale price and the benchmark resale price was then 
calculated in order to determine whether or not there had been sufficient movement in 
resale prices following the imposition of anti-dumping measures. 
(22) It was found that the imposition of anti-dumping measures had led to insufficient 
movement in resale prices in the Community. The actual resale price remained below 
the benchmark resale price on a weighted average basis. This shortfall in price 
movement is expressed below as a percentage of the weighted average actual resale 
price: 
9.0% 
In view of the significant shortfall in the movement of resale prices, it was not 
considered necessary to investigate any further whether the subsequent selling prices in 
the Community had moved sufficiently. 
(d) Other factors affecting the average resale price of the product after imposition of 
the anti-dumping duty 
(23) No other arguments were brought forward by interested parties, nor were any other 
factors found during the reinvestigation, explaining why resale prices as indicated 
above did not move to the extent that could reasonably be expected after the imposition 
of the anti-dumping duty. 
Certain importers argued that low resale prices reflected the poor condition of the 
market for ammonium nitrate. Such a situation does not, however, address the issue 
under consideration which is that, for the period of reinvestigation (i.e. one year), resale 
prices did not sufficiently reflect costs incurred and profit realised, had the minimum 
import price been respected. 
(e) Conclusion 
(24) The Council concludes that for ammonium nitrate originating in Russia, the anti­
dumping measures have not led to sufficient movement in resale prices in the 
Community within the meaning of Article 12 (2) of the basic Regulation. 
3. Recalculation of the dumping margin 
(25) In accordance with Article 2 of the basic Regulation, a new dumping margin was 
established, as required by Article 12 (2) of that Regulation. 
(a) Normal value 
(26) As no producer/exporter claimed a change in normal value had occurred, as provided 
for by Article 12 (5) of the basic Regulation, the normal value as established in the 
original investigation for the analogue country, Poland, was used for the recalculation 
of the dumping margin. 
(b) Reassessed export price 
(27) One export price was calculated for all ammonium nitrate originating in Russia 
imported into the Community during the period of reinvestigation. 
(28) For imports accounted for by cooperating importers/traders/distributors, export prices 
were calculated, using information verified on-the-spot, on the basis of the price paid or 
payable by these operators. 
(29) In the absence of export prices for imports accounted for by non-cooperators it was 
decided to construct such prices in accordance with Article 2 (9) of the basic 
Regulation. In this regard, Eurostat import statistics were not considered a reliable 
basis for establishing such prices in view of the apparent existence of an association or 
compensatory arrangement. This consideration concurs with evidence provided by 
customs authorities in the United Kingdom indicating widespread overstatement of 
export prices by certain non-cooperators. This is also the conclusion drawn from 
information concerning resale invoices in the hands of the Commission which indicates 
a price for resale far below that which would allow an importer to carry on normal 
business, were the minimum import price being respected; in other words, if all costs 
incurred between import and resale were deducted from the resale invoice price to the 
first independent buyer, an import price is reached, Community frontier before customs 
clearance, which is lower than the minimum import price. 
Reliable export prices at the Community frontier were therefore constructed on the 
basis of the price at which the imported product was first resold to an independent 
buyer, established on the basis of facts available in accordance with Article 18 of the 
basic Regulation, i.e. the information referred to in recital (19) above, with adjustments 
made for all costs incurred between importation and resale, including the anti-dumping 
duty payable, plus a reasonable amount for profit. The amount for profit was 
determined on the basis of information contained in the request for a reopening of the 
reinvestigation, which has been corroborated by other sources. 
(30) A weighted average Community frontier export price was then calculated for all 
imports of ammonium nitrate originating in Russia. 
(c) Comparison 
(31) A fair comparison was made between the normal value as established in the original 
investigation and the weighted average export price as established above, in accordance 
with Article 2(10) of the basic Regulation. 
(d) Dumping margin 
(32) The comparison of normal value with reassessed weighted average export prices 
showed the existence of a higher dumping margin as compared with that found in the 
original investigation. The recalculated weighted average dumping margin, expressed 
as a percentage of the cif price free at the Community frontier, is: 
41.9% 
(e) Conclusion 
10 
(33) As the reinvestigation has shown that the measures in force have led lo msullicicni 
movement in resale prices in the Community and that dumping margins have increased. 
the measures in force shall be amended, in line with the new findings on export prices. 
in accordance with Article 12 (3) of the basic Regulation. 
4. Proposed change of the measures applicable 
(34) The measures previously applicable did not have their intended effect upon the resale 
price of ammonium nitrate originating in Russia, due to absorption of the anti-dumping 
measures in force. Actual resale prices for the period of reinvestigation did not reflect 
the costs incurred between the levels of import and resale. 
During the course of the reinvestigation it was considered whether it would be 
appropriate simply to increase the minimum import price to reflect the increased 
dumping margin. 
The very fact, however, that absorption of anti-dumping duties in the form of a 
minimum import price has taken place also means that any increase in the level of the 
minimum import price might be equally ineffective in revising resale prices or 
subsequent selling prices in the Community. 
From the foregoing, it can be seen that the flexibility permitted to the Russian 
producers/exporters by the variable anti-dumping duty hitherto applicable has failed to 
revise prices for ammonium nitrate originating in Russia to the extent that the injurious 
effect of the dumping has not been removed. 
(35) It is concluded from the findings of the reinvestigation - and taking into account the 
past history of anti-dumping measures concerning imports of ammonium nitrate 
originating in Russia, which involved the breach of an undertaking in the first year 
following its acceptance by the Commission (see recital (1) above) - that it is also 
prudent to alter the form of measures in force. In view of the possibility of absorption 
of an ad-valorem duty for this seasonal and price-sensitive product, the Council 
considers it appropriate to amend the definitive anti-dumping duty imposed on imports 
of ammonium nitrate originating in Russia from the minimum import price currently in 
force to a specific duty per tonne. This form of anti-dumping measure would be more 
11 
effective in revising resale prices and thus remedying the injurious effect of die 
dumping. 
One importer argued that the problem of absorption of the anti-dumping duty in force 
was confined to imports made in bulk and that, therefore, while the specific duty was 
appropriate for imports made in bulk, the minimum import price should remain in force 
for imports made in bags. After consideration of the merits of this argument it was not 
accepted for the reason that the findings of the reinvestigation indicated that absorption 
of the duties was not confined to those imports made in bulk. 
One producer located in Russia, which had at no time prior to disclosure of the findings 
of the reinvestigation made itself known, proposed an undertaking. After consideration, 
this proposal was judged to be unacceptable due to the total lack of cooperation from all 
Russian producers/exporters. 
(36) The new level of anti-dumping duty was determined by adding to the previous level of 
the duty (minimum import price less export price at the Community frontier in the 
original investigation period) the difference between the export prices in the original 
investigation and those of the current reinvestigation. The amended duty, to be levied 
on a per tonne net basis at the Community frontier, is ECU 26.3 per tonne. 
HAS ADOPTED THIS REGULATION: 
Article 1 
Article 1 par. 2 of Regulation (EC) No 2022/95 is hereby replaced by the following: "2. 
The rate of the anti-dumping duty applicable is ECU 26.3 per tonne." 
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. 
12 
Done at Brussels, 
For the Council 
The President 
13 

ISSN 0254-1475 
COM(98) 148 final 
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