COMMISSION OF THE EUROPEAN COMMUNITIES 
Brussels, 11.12.1997 
COM(97) 697 final 
Proposal for a 
COUNCIL REGULATION (EC) 
amending Regulation (EEC) No 3482/92 imposing a definitive anti-dumping duty on 
imports of certain large electrolytic aluminium capacitors originating in Japan 
(presented by the Commission) 

EXPLANATORY MEMORANDUM 
1. Attached is a proposal for a Council Regulation amending Regulation (EEC) No 
3482/92 imposing a definitive anti-dumping duty on imports of certain large 
electrolytic alumium capacitors originating in Japan. 
2. The proposed act concerns a review investigation pursuant to Article 11 (3) of the 
Basic Anti-dumping Regulation which has led to the conclusion that one Japanese 
producer (Rubycon Corporation) has decreased its dumping margin from 30.1 % to 
4.2 %. 
3. The proposed act therefore envisages the reduction of the duty rate for this company to 
4.2 %. 
COUNCIL REGULATION (EC) No 
of 
amending Regulation (EEC) No 3482/92 imposing a definitive anti-dumping duty on 
imports of certain large electrolytic aluminium capacitors originating in Japan 
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 
Community (') and in particular Article 11 (3) thereof, 
Having regard to the proposal submitted by the Commission after consulting the Advisory 
Committee, 
WHEREAS: 
1 OJ No L 56, 6. 3 1996, p.l. Regulation as amended by Regulation (EC) No 2331/96 (OJ No L 317, 
6. 12. 1996, p. 1). 
A. PROCEDURE 
1. Measures in force 
(1) In December 1992, the Council, by Regulation (EEC) No 3482/92 (2), imposed a 
definitive anti-dumping duty on imports of certain large aluminium electrolytic 
capacitors (hereinafter "LAECs") originating in Japan. For Rubycon Corporation 
(hereinafter "Rubycon"), the rate of the definitive anti-dumping duty amounted to 
30.1% expressed as a percentage of the net, free at Community frontier price, 
before duty. The investigation that led to the imposition of these measures is 
hereinafter referred to as "the initial investigation". 
2. Request for a review investigation 
(2) In September 1996, Rubycon lodged a request for an interim review pursuant to 
Article 11 (3) of Council Regulation (EC) No 384/96 (hereinafter the "Basic 
Regulation"). Rubycon alleged that the continued imposition of the anti-dumping 
duty would no longer be necessary to offset the dumping as established in the 
initial investigation. 
OJNoL353. 3. 12. 1992, p. 1. 
3. Review investigation 
(3) The Commission considered that Rubycon had submitted sufficient prima facie 
evidence to justify an interim review. Consequently, the Commission announced -
on 17 December 1996 - by a notice published in the Official Journal of the 
European Communities (3) the initiation of a review investigation pursuant to 
Article 11 (3) of the Basic Regulation and commenced an investigation. 
Since no other interested party had submitted sufficient evidence justifying the 
initiation of a review investigation, the investigation was limited to Rubycon. The 
investigation concerned the aspects of dumping only. 
(4) The Commission officially advised Rubycon, the representatives of the exporting 
country, two unrelated importers and the complainant in the initial investigation 
(hereinafter "FARAD") of the initiation of the review. 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 a hearing. 
(5) The investigation covered the period of 1 October 1995 to 30 September 1996 
(hereinafter referred to as "the investigation period"). For the purpose of this 
investigation, the geographical scope of the investigation was the Community as 
composed at the time of initiation of this review. 
3 OJ No C 381, 17. 12. 1996, p. 7. 
(6) The Commission sent questionnaires to all parties known to be concerned and 
received replies from Rubycon, its related importer in the Community (hereinafter 
Rubycon UK) and two unrelated importers in the Community. 
(7) The Commission sought and verified all the information it considered necessary 
and carried out investigations at the premises of the following companies: 
(a) producer/exporter in Japan 
- Rubycon Corporation, Tokyo and Ina. 
(b) importer related to the producer/exporter 
- Rubycon UK, South Ruislip, United Kingdom. 
(c) importer not related to the producer/exporter 
- Codico Gesellschaft m.b.H. &Co KG, Vienna, Austria (hereinafter Codico). 
During the on-spot verification at the premises of Codico, it became apparent that 
the company had provided misleading information. In particular, the company had 
not reported a significant number of its import transactions. This and some other 
deficiencies did cast a serious overall doubt on the reliability of the information 
provided by the company. Consequently, the Commission decided to base its 
findings for this company on facts available in accordance with Article 18 of the 
Basic Regulation and informed the company accordingly. 
An investigation at the premises of the other importer were not deemed necessary 
due to the relatively insignificant importance of its total import transactions 
relating to LAECs produced by Rubycon. 
(8) Owing to the volume and the complexity of the data gathered and examined, the 
investigation exceeded the normal time period of 12 months foreseen in Article 11 
(5) of the Basic Regulation. 
(9) Parties were informed in writing of the essential facts and considerations on the 
basis of which it was intended to amend Regulation (EEC) No 3482/92. The 
comments presented by the parties were considered and, where appropriate, the 
findings were modified to take account of them. 
B. PRODUCT CONCERNED 
(10) The product subject to the definitive anti-dumping duty referred to in recital 1 is 
large electrical capacitors, aluminium electrolytic, with a CV product (capacitance 
multiplied by rated voltage) between 18 000 and 310 000 pic (micro-coulombs), at 
a voltage of 160 V or more and with a diameter of 19 mm or more and at a length 
of 20 mm or more. The product is classifiable under CN code ex 8532 22 00. 
For the purpose of this review investigation which concerned only one of the 
known Japanese producers/exporters and which was limited to aspects of 
dumping, it was not considered appropriate to extend the like product definition as 
it was done - due to technical developments of the product concerned - in the 
investigation relating to imports of LAECs originating in the Republic of Korea 
and Taiwan (4). 
4 Régulation (EC) No 1384/94, OJ NG L 152, 18. 6. 1994, p. 1, confirming Regulation (EC) No 
371/94, Oi No L 48, 19. 2. 1994, p. 10. 
6 
C. DUMPING 
1. Preliminary remark 
(11) In the initial investigation the dumping margin was calculated on the basis of the 
best selling models which accounted for more than 70% of the exporter's total 
transactions to the Community. Consequently, the calculation in this investigation 
was also based on best selling models accounting for more than 70% of the export 
volume. 
In their comments to the respective disclosure letters, Rubycon and FARAD 
claimed that it would have been more appropriate to use a different set of 
transactions. In particular, Rubycon claimed that - instead of relying on quantities -
70% of the export turnover should have been used, whereas FARAD proposed to 
use a completely different set of transactions in order to avoid the risk that the 
exporter only increases its export prices for certain best-selling models. 
The Council noted, however, that the Commission was neither provided with, nor 
did it otherwise receive information indicating a "change of circumstances" in the 
sense of Article 11 (9) of the Basic Regulation which would suggest that a change 
in methodology for the determination of the export prices is warranted. Therefore, 
it was considered appropriate - as in the initial investigation - to rely on the models 
accounting for 70% of Rubycon's export volume. 
2. Normal Value 
(12) As regards the determination of the normal value, two types of best selling models 
have been distinguished. 
For models which were sold in sufficient quantities and in the ordinary course of 
trade during the investigation period on the Japanese domestic market, normal 
values were based on the (profitable) domestic sales prices in accordance with 
Article 2 (2) and (4) of the Basic Regulation. 
(13) For all other models, for which no or insufficient domestic sales in the ordinary 
course of trade were made during the investigation period, normal values were 
constructed in accordance with Article 2 (3) of the Basic Regulation. In this 
respect, normal values were calculated by adding up cost of manufacturing, 
domestic SGA expenses and a reasonable amount of profit, calculated on the basis 
of the weighted average profit margin of Rubycon achieved on its profitable 
domestic sales of LAECs. The cost of manufacturing reported by Rubycon was 
corrected since it appeared that the company had not provided the actual purchase 
price for a certain part used in the production of LAECs which was subject to 
outside processing. 
3. Export prices 
(14) As regards the determination of the export price, a distinction was made between 
sales to related and unrelated parties in the Community. 
In accordance with Article 2 (8) of the Basic Regulation, export prices of sales to 
unrelated companies were determined on the basis of prices actually paid for the 
products sold for export to the Community. 
(15) In the case of export sales to Rubycon UK, the related importer, export prices 
were constructed on the basis of resale prices to the first independent purchaser, 
duly adjusted to take account of all actual costs incurred between importation and 
resale. In addition, an adjustment was made for a profit margin of 5% which was 
considered a reasonable percentage and which is the same as that used in the initial 
investigation in conformity with Article 11 (9) of the Basic Regulation. As for the 
profit margin, it was noted that data received from the two importers that made 
themselves known in this investigation could not be used since one is a non-
cooperating party whereas the other does not resell the product concerned. 
(16) Anti-dumping duties paid upon importation were deducted as a cost in accordance 
with Article 2 (9) of the Basic Regulation when constructing the ex works export 
prices since no conclusive evidence pursuant to Article 11 (10) of the Basic 
Regulation was provided in the course of the investigation showing that the anti­
dumping duties are duly reflected in the subsequent selling prices of the customers 
of Rubycon UK in the Community. 
(17) Finally, it was noted that part of Rubycon's products were sold to customers in the 
Community producing under the regime of inward processing relief. These export 
transactions under inward processing relief were taken into account in the 
calculation of Rubycon's export price. Rubycon contested this approach. 
In this respect, it was considered that the exporter does not necessarily know for 
all transactions whether their customers release the models under inward 
processing relief into free circulation at a later stage or whether finished goods 
containing Rubycon's LAECs are reimported into the Community at a later stage. 
10 
5 In addition, sales of LAECs to companies using the inward processing relief may 
well contribute to the injury caused to Community producers as they reduce 
outlets which could otherwise be available to them. This is not contradicted by the 
requirements of Article 552 of Commission Regulation (EEC) No 2454/93 (5) 
containing provisions operating the inward processing authorisation according to 
the Community Customs Code. In particular, it was found that the "economic 
conditions" to be fulfilled when granting the authorisation to operate under in­
ward-processing relief can - in a significant number of instances - be satisfied 
without (in depth) verification of whether comparable goods are actually produced 
in the Community. In this respect it was also noted that Rubycon had - despite a 
request from the Commission - not provided sufficient information showing why 
Rubycon or its customers had received the respective authorisation. Consequently, 
it cannot be excluded that in the present case Community producers were deprived 
of sales opportunities otherwise available to them. 
Finally, it was noted that the inclusion of export transactions relating to inward 
processing is in line with the Basic Regulation which provides in its Article 1 (2) 
that a product is considered as being dumped "if its export price to the 
Community" (as opposed to its release into free circulation in the Community, 
emphasis added) is less than its normal value. 
Consequently, the Council concluded that the inclusion of export transactions 
relating to inward processing relief is justified for this investigation. 
OJ No L 253, 11. 10. 1993, p. 1, as last amended by Regulation (EC) No 1427/97, OJ No L 196, 24. 
7. 1997, p. 31. 
11 
4. Comparison 
(18) Normal values were compared with export prices at an ex-factory level. As far as 
differences in conditions and terms of sale are concerned, allowances were granted 
in accordance with Article 2 (10) of the Basic Regulation for delivery and payment 
terms. 
(19) Claims for adjustments for salesmen's salaries and advertising costs could not be 
granted since it was not demonstrated that price comparability of normal value and 
export price was affected. 
5. Dumping Margin 
(20) The comparison of weighted average normal values with weighted average export 
prices showed the existence of dumping. Expressed as a percentage of the free-at-
Community-frontier price, the weighted average dumping margin amounted to: 
Rubycon 4.2% 
12 
D. NEW LEVEL OF DUTY 
(21 ) The dumping margin established in the present review is lower than the dumping 
margin found in the initial investigation, which formed the basis of the duty rate. 
Since no clear indications were received or found showing that dumping would 
recur at a higher level once the review has been finalised, the Council concludes 
that Regulation (EEC) No 3482/92 should be amended in respect of Rubycon 
Corporation, Ina Nagano. The new duty rates amounts to 4.2 %. 
(22) This review does not affect the date on which Regulation (EEC) No 3482/92 
expires, pursuant to Article 11 (2) of the Basic Regulation. 
HAS ADOPTED THIS REGULATION: 
13 
Article 1 
Article 1 (2) of Regulation (EEC) No 3482/02 is hereby amended as follows : 
The figure in the rate of duty column of "30.1 %" relating to Rubycon Corporation, Ina 
Nagano, shall be replaced by "4.2 %". 
Article 2 
This Regulation shall enter into force on the day following that of its publication in the 
OfficialJournal 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 
14 
ISSN 0254-1475 
COM(97) 697 final 
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