REPORT FROM THE COMMISSION - EIGHTEENTH ANNUAL REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT ON THE COMMUNITY'S ANTI-DUMPING AND ANTI-SUBSIDY ACTIVITIES - OVERVIEW OF THE MONITORING OF THIRD COUNTRY SAFEGUARD CASES AND OF THE IMPLEMENTATION OF THE TRADE BARRIERS REGULATION (1999)

(18th Annual report to the Parliament - 1999)

CONTENTS

Purpose and Aim

1. Overview of anti-dumping and anti-subsidy legislation

1.1. The legal framework

1.1.1. The applicable law

1.1.1.1. The international framework

1.1.1.2. The Community legislation

1.1.2. What is dumping and what are countervailable subsidies - the material conditions for the imposition of duties

1.1.2.1. Dumping and Subsidies

1.1.2.2. Material Injury and Causation

1.1.2.3. Community interest

1.1.3. Procedure

1.1.4. The anti-dumping and anti-subsidy services

1.2. Changes to the basic Regulations

1.3. Implementation of Council Regulation (EC) No 905/98 related to individual Market Economy Status for companies in China and Russia

1.3.1. Regulation (EC) No 905/98 amending the anti-dumping basic Regulation

1.3.2. Observations on the application of the new rule since 1 July 1998

1.4. WTO dispute settlement in the field of anti-dumping and anti-subsidy

1.4.1. Definition of the WTO dispute settlement procedure

1.4.2. Panel proceedings involving EU anti-dumping and anti-subsidy activities

2. General overview of measures in force

3. Initiations of Anti-dumping and Anti-subsidy Investigations

3.1. Introduction

3.2. Cases

3.2.1. Flat rolled products of iron or non-alloy steel from Bulgaria, India, Iran, South Africa, the Federal Republic of Yugoslavia and Taiwan

3.2.2. Flat rolled products of iron or non-alloy steel from India, Taiwan and

outh Africa (AS)

3.2.3. Yellow phosphorus from the People's Republic of China

3.2.4. Television camera systems from the USA

3.2.5. Parts of television camera systems from Japan

3.2.6. Compact-disc boxes from the People's Republic of China

3.2.7. Video tapes on reels from the Republic of Korea

3.2.8. Synthetic fibres of polyester from Australia, Indonesia and Thailand

3.2.9. Synthetic fibres of polyester from Australia, Indonesia, the Republic of Korea, Taiwan and Thailand (AS)

3.2.10. Hot-rolled flat products of non-alloy steel from India, the People's Republic of China and Romania

3.2.11. Steel wire rod from Turkey

3.2.12. Malleable cast iron tube or pipe fittings from Brazil, Croatia, the Czech Republic, the Federal Republic of Yugoslavia, Japan, the People's Republic of China, the Republic of Korea and Thailand

3.2.13. Solutions of urea and ammonium nitrate from Algeria, Belarus, Lithuania, Russia, the Slovak Republic and Ukraine

3.2.14. Stainless steel fasteners from Malaysia, Singapore, the Philippines and Thailand (AS)

3.2.15. One Dye Black 1 (ODB-1) from Japan

3.2.16. One Dye Black 2 (ODB-2) from Japan

3.2.17. Cathode-ray colour television picture tubes from the People's Republic of China, India, the Republic of Korea, Lithuania and Malaysia

3.2.18. Hair brushes from the People's Republic of China, Hong Kong, the Republic of Korea, Taiwan and Thailand

3.2.19. Glycine from the People's Republic of China

3.2.20. Styrene-butadiene-styrene (SBS) thermoplastic rubbers from Taiwan (AS)

3.2.21. Styrene-butadiene-styrene (SBS) thermoplastic rubbers from Taiwan

3.2.22. Electronic weighing scales from the People's Republic of China, the Republic of Korea and Taiwan

3.2.23. Woven glass fibre fabrics from Taiwan (AS)

3.2.24. Coke over 80 mm from the People's Republic of China

3.2.25. Polyester staple fibres from the Republic of Korea

3.2.26. Ammonium nitrate from Lithuania, Poland and Ukraine

3.2.27. Bicycle forks from the People's Republic of China and Taiwan

3.2.28. Bicycle frames from the People's Republic of China and Taiwan

3.2.29. Bicycle wheels from the People's Republic of China

3.2.30. Polyethylene terephthalate (PET) from India, Indonesia, Malaysia, the Republic of Korea, Taiwan and Thailand

3.2.31. Polyethylene terephthalate (PET) from India, Indonesia, Malaysia, the Republic of Korea, Taiwan and Thailand (AS)

3.2.32. Polyester staple fibres from India

4. Provisional measures

4.1. Overview

4.2. Cases

4.2.1. Steel ropes and cables from the People's Republic of China, Hungary, India, Mexico, Poland, South Africa and Ukraine

4.2.2. Stainless steel wire having a diameter of less than 1 mm from India and the Republic of Korea (AS)

4.2.3. Stainless steel wire having a diameter of less than 1 mm from the Republic of Korea

4.2.4. Stainless steel wire having a diameter of 1 mm or more from India

4.2.5. Stainless steel wire having a diameter of 1 mm or more from India and the Republic of Korea (AS)

4.2.6. Seamless pipes and tubes from Croatia and Ukraine

4.2.7. Polyethylene terephthalate (PET) film from India (AS)

4.2.8. Compact discs boxes from the People's Republic of China

5. Definitive measures

5.1. Overview

5.2. Cases

5.2.1. Hardboard from Bulgaria, Estonia, Latvia, Lithuania, Poland and Russia

5.2.2. Bicycles from Taiwan

5.2.3. Polypropylene binder or baler twine from Poland, the Czech Republic and Hungary

5.2.4. Stainless steel wires with a diameter of 1 mm or more from India (AS)

5.2.5. Stainless steel wires with a diameter of 1 mm or more from India

5.2.6. Stainless steel wires with a diameter of less than 1 mm from India (AS)

5.2.7. Steel ropes and cables from the People's Republic of China, Hungary, India, Mexico, Poland, South Africa and Ukraine

5.2.8. Polyethylene terephthalate (PET) film from India (AS)

6. Investigations terminated without measures

6.1. Overview

6.2. Cases

6.2.1. Laser optical reading systems from Japan, the Republic of Korea, Malaysia, the People's Republic of China and Taiwan

6.2.2. Hardboard from Brazil

6.2.3. Large electrolytic aluminium capacitors from the USA and Thailand

6.2.4. Polypropylene binder or baler twine from Saudi Arabia

6.2.5. Polypropylene binder or baler twine from Saudi Arabia (AS)

6.2.6. Stainless steel heavy plates from Slovenia and South Africa

6.2.7. Polyester textured filament yarn from India and the Republic of Korea

6.2.8. Polyester textured filament yarn from India and the Republic of Korea (AS)

6.2.9. Stainless steel wires with a diameter of 1 mm or more from the Republic of Korea (AS)

6.2.10. Stainless steel wires with a diameter of 1 mm or more from the Republic of Korea

6.2.11. Stainless steel wires with a diameter of less than 1 mm from the Republic of Korea (AS)

6.2.12. Stainless steel wires with a diameter of less than 1 mm from the Republic of Korea

6.2.13. Steel ropes and cables from the Republic of Korea

6.2.14. Video tapes on reels from the Republic of Korea

7. Reviews of anti-dumping and anti-subsidy measures

7.1. Overview

7.2. Expiry reviews

7.2.1. Expiry reviews initiated

7.2.1.1. Ethanolamine from the USA

7.2.1.2. Fluorspar from the People's Republic of China

7.2.1.3. Potassium chloride from Belarus, Russia and Ukraine

7.2.1.4. Silicon carbide from the People's Republic of China, Russia and Ukraine

7.2.1.5. Television camera systems from Japan

7.2.1.6. Magnetic disks (3,5" microdisks) from Hong Kong and the Republic of Korea

7.2.1.7. Potassium permanganate from the People's Republic of China

7.2.1.8. Urea ammonium nitrate solution (UAN) from Poland

7.2.2. Expiry reviews concluded

7.2.2.1. Magnesium oxide from the People's Republic of China

7.2.2.2. Synthetic fibres of polyester from Taiwan

7.2.3. Expiry reviews terminated

7.2.3.1. Ferro-silicon from Egypt and Poland

7.2.3.2. Synthetic fibres of polyester from the Republic of Korea

7.3. Interim reviews

7.3.1. Interim reviews initiated

7.3.1.1. Ethanolamine from the USA

7.3.1.2. Fluorspar from the People's Republic of China

7.3.1.3. Personal fax machines from Japan and Singapore

7.3.1.4. Seamless pipes and tubes of iron or non-alloy steel from Russia

7.3.1.5. Potassium chloride from Belarus, Russia and Ukraine

7.3.1.6. Polyester textured filament yarn (PTY) from Taiwan

7.3.1.7. Microwave ovens from the Republic of Korea

7.3.1.8. Magnetic disks (3,5" microdisks) from Taiwan

7.3.1.9. Tube or pipe fittings, of iron or steel from Thailand

7.3.1.10. Polyester textured filament yarn (PTY) from Malaysia

7.3.1.11. Bicycle parts from the People's Republic of China

7.3.1.12. Urea ammonium nitrate solution from Poland

7.3.2. Interim reviews concluded

7.3.2.1. Calcium metal from the People's Republic of China and Russia

7.3.2.2. Salmon (AD/AS) from Norway

7.3.2.3. Personal fax machines from Japan and Singapore

7.3.2.4. Ferro-chrome (low carbon) from Kazakhstan, Russia and Ukraine

7.3.2.5. Magnetic disks (3,5" microdisks) from Japan, Taiwan, the People's Republic of China, Hong Kong, the Republic of Korea, Malaysia, Mexico, U.S.A. and Indonesia

7.3.2.6. Furfuraldehyde from the People's Republic of China

7.4. Newcomer reviews

7.4.1. New exporter reviews initiated

7.4.1.1. Handbags (leather) from the People's Republic of China

7.4.2. New exporter reviews concluded

7.4.2.1. Polyethylene/polypropylene sacks and bags from India

7.4.2.2. Magnetic disks (3,5" microdisks) from Indonesia

7.5. Absorption investigations

7.5.1. Anti-absorption investigations initiated

7.5.1.1. Ring-binder mechanisms from the People's Republic of China

7.5.1.2. Stainless steel fasteners & parts thereof from Malaysia and Thailand

7.5.1.3. Magnesium (unwrought, unalloyed) from the People's Republic of China

7.6. Circumvention investigations

7.6.1. Anti-circumvention investigations initiated

7.6.1.1. Magnetic disks (3,5" microdisks) from the People's Republic of China and Taiwan

7.6.1.2. Tube and pipe fittings of iron or steel from the

People's Republic of China

7.6.2. Anti-circumvention investigations concluded

7.6.2.1. Lighters (refillable and non-refillable) from the People's Republic of China

7.6.2.2. Television camera systems from Japan

7.7. Accelerated review investigations

7.7.1. Accelerated review investigations initiated

7.7.1.1. Stainless steel bars from India

7.7.1.2. Stainless steel wire with a diameter of less than 1 mm from India

7.7.1.3. Stainless steel wire with a diameter of 1 mm or more from India

7.7.1.4. Stainless steel bars from India

7.7.2. Accelerated review investigations concluded

7.7.2.1. Stainless steel bars from India

8. Monitoring of undertakings

9. Refunds

10. Judicial review : Decisions by the Court of Justice/Court of First Instance

10.1. Overview of the judicial reviews in 1999

10.2. Cases pending

10.3. New cases

10.4. Judgments rendered by the Court of First Instance

10.4.1. Microwave ovens originating, inter alia, in Thailand

10.4.2. Gas-fuelled, non refillable pocket flint lighters originating in, inter alia, the Philippines

10.4.3. Ammonium nitrate originating in Russia

10.4.4. Certain seamless pipes and tubes of Iron or non-alloy steel originating in Hungary, Poland, Russia, the Czech Republic, Romania and the Slovak Republic

11. Anti-dumping and anti-subsidy investigations of third countries concerning imports from EU Member States

11.1. Anti-dumping cases against EU Member States

11.1.1. Initiations (still at initiation stage)

11.1.1.1. Supertension cable from Germany

11.1.1.2. Sterile synthetic absorbable surgical sutures from Germany

11.1.1.3. X-ray film from Germany

11.1.1.4. Pure terephtalic acid from Spain

11.1.1.5. Pre-sensitised printing plates from the Netherlands

11.1.1.6. Over-headed aluminium stranded wire or cable with steel core from France

11.1.1.7. Tin from the Netherlands

11.1.1.8. Structural steel beams from Germany and Spain

11.1.1.9. Carton-board from Austria, Spain, Italy and Sweden

11.1.1.10. Oxo alcohol from, inter alia, the European Union

11.1.1.11. Vitamin-C from the European Union

11.1.1.12. Insulin products from France and Denmark

11.1.1.13. Cars from, inter alia, the European Union

11.1.1.14. Milk from, inter alia, the European Union

11.1.1.15. Photographic paper from the UK and France

11.1.1.16. Salt from the European Union

11.1.1.17. D-Glucitol (Sorbitol) from the European Union

11.1.1.18. Methyl methacrylate from Germany, Spain, United Kingdom & France

11.1.1.19. Polyurethane products from, inter alia, the European Union

11.1.1.20. Certain hot-rolled carbon steel plate from, inter alia, Finland

11.1.1.21. Glass microspheres from, inter alia, France and Germany

11.1.2. Provisional measures

11.1.2.1. Cut-to-length steel plate from France and Italy

11.1.2.2. Thermal sensitive paper from Finland, Germany and the European Union

11.1.2.3. Insecticide from Denmark

11.1.2.4. Sodium cyanide from Germany and the European Union

11.1.2.5. Seamless tubes from Austria

11.1.3. Definitive measures

11.1.3.1. Acrylic fibre from Spain, Italy and Portugal

11.1.3.2. Filter tipped cigarette tubes from France and Germany

11.1.3.3. Uncoated white cut ream copy papers from Finland

11.1.3.4. Cartonboard from Germany

11.1.3.5. Hypodermic needles from Belgium, Germany, Ireland and Spain

11.1.3.6. Stainless steel plate in coils from Belgium and Italy

11.1.3.7. Acetaminophenol from France

11.1.3.8. Flat hot-rolled carbon and alloy sheet and strip from France

11.1.3.9. Stainless steel sheet and strip in coils from France, Germany, Italy and the UK

11.1.3.10. Polycarbonates from Germany

11.1.3.11. Cold-rolled steel sheet from Belgium and Spain

11.1.3.12. Tyres from France and the EU

11.1.3.13. Thermal sensitive paper from Finland, Germany and the European Union

11.1.3.14. Floor tiles from Italy

11.1.3.15. Woven pile weather stripping from Spain and the UK

11.1.3.16. Wound skin and closure strips from France and Germany

11.1.4. Investigations terminated without measures

11.1.4.1. Polymeric plasticisers from the UK

11.1.4.2. Styrene butane rubber from Germany and France

11.1.4.3. Industrial sewing machine needles from Germany

11.1.4.4. Stainless steel round wire from, inter alia, Spain

11.1.4.5. Glass containers from Germany, Italy, Portugal and Spain

11.1.4.6. Infant milk formula from Denmark and the Netherlands

11.1.4.7. Structural steel beams from Germany and Spain

11.1.4.8. Inhibitors from Germany

11.1.4.9. Acrylic Fibre from, inter alia, the European Union

11.1.5. Pending investigations initiated before 1999

11.1.5.1. Coated paperboard from Austria, Germany, the Netherlands and Spain

11.1.5.2. Rock wool from the Netherlands

11.1.5.3. Crystal polystyrene from the European Union

11.1.5.4. Woven polypropylene carpet from, inter alia, Belgium and the UK

11.1.5.5. Bolts and nuts from, inter alia, Spain

11.1.5.6. Hydroethylcellulose from, inter alia, the Netherlands

11.1.5.7. Hot and cold-rolled stainless steel from France, Germany, Italy and Spain

11.1.6. Sunset review investigations having led to a change in the imposed duties

11.1.6.1. Stainless steel bars from France, Germany, Italy, Spain, Sweden, United Kingdom

11.1.6.2. Refined sugar from Belgium, Denmark, Germany, The Netherlands

11.1.6.3. Certain coated papers from Austria and Finland

11.2. Anti-subsidy cases against EU Member States

11.2.1. Initiations (still at initiation stage)

11.2.1.1. Brandy from France

11.2.1.2. Canned ham and canned pork luncheon meat from Denmark and the Netherlands

11.2.2. Provisional measures

11.2.2.1. Cut-to-length carbon steel plate from Italy and France

11.2.2.2. Milk powder from the European Community

11.2.3. Definitive measures

11.2.3.1. Stainless steel plate in coils from Italy and Belgium

11.2.3.2. Cut-to-length carbon steel plate from Belgium

11.2.3.3. Stainless steel sheet and strip from Italy and France

11.2.3.4. Lead and bismuth steel from the UK

11.2.4. Investigations terminated without measures

11.2.4.1. Sugar from the European Community

11.2.4.2. Lead and Bismuth Steel from Germany

11.2.4.3. Leaded billets from UK and Germany

11.2.5. Review investigations having led to a change in the imposed duties

11.2.5.1. Pasta from Italy

12. Safeguard measures

12.1. Legal framework

12.2. The Community's activities in the field of safeguards

12.3. Overview of the recent main third country safeguard cases

12.3.1. Brazil

12.3.1.1. Toys

12.3.2. Chile

12.3.2.1. Wheat, wheat flour, sugar and edible vegetable oils

12.3.3. Czech Republic

12.3.3.1. Sugar

12.3.4. Egypt

12.3.4.1. Safety wooden matches

12.3.4.2. Fluorescent lamps

12.3.5. India

12.3.5.1. Phenol

12.3.5.2. Acetone

12.3.5.3. White/yellow phophorus

12.3.6. Latvia

12.3.6.1. Swine meat

12.3.7. Poland

12.3.7.1. Flat steel products

12.3.7.2. Tractors

12.3.7.3. Yoghurt

12.3.8. Slovenia

12.3.8.1. Swine meat

12.3.9. Slovakia

12.3.9.1. Swine meat

12.3.10. USA

12.3.10.1. Wheat gluten

12.3.10.2. Steel wire rod

12.3.10.3. Welded line pipe

12.3.10.4. Lamb

12.4. Appellate body reports on safeguard measures

12.4.1. Appellate Body Report on Argentina Footwear

12.4.2. Appellate Body Report on Korea - Dairy Products

13. The Trade Barriers Regulation (TBR)

13.1. Background and objectives

13.2. Legal framework of the TBR

13.2.1. Applicability

13.2.2. Procedure

13.2.3. Action under the TBR

13.2.3.1. Procedures initiated in 1999

13.2.3.2. Overview of the application of the TBR since its entry into force

LIST OF ANNEXES

ANNEXES : SUMMARY

ANNEX A // New investigations initiated during the period 1 January - 31 December 1999

ANNEX B // New investigations initiated by country of export during the period 1994 - 1999 (31 December)

ANNEX C // New investigations initiated by product sector during the period 1994 - 1999 (31 December)

ANNEX D // New investigations concluded by the imposition of provisional duties during the period 1 January - 31 December 1999

ANNEX E // New investigations concluded by the imposition of definitive duties during the period 1 January - 31 December 1999

ANNEX F // New investigations terminated without imposition of measures during the period 1 January - 31 December 1999

ANNEX G // Expiry reviews initiated or concluded during the period 1 January - 31 December 1999

ANNEX H // Interim reviews initiated or concluded during the period 1 January - 31 December 1999

ANNEX I // New exporter reviews initiated or concluded during the period 1 January - 31 December 1999

ANNEX J // Anti-absorption investigations initiated or concluded during the period 1 January - 31 December 1999

ANNEX K // Anti-circumvention investigations initiated or concluded during the period 1 January - 31 December 1999

ANNEX L // Accelerated review investigations (anti-subsidy) initiated or concluded during the period 1 January - 31 December 1999

ANNEX M // Undertakings accepted or repealed during the period 1 January - 31 December 1999

ANNEX N // Measures which expired during the period 1 January - 31 December 1999

ANNEX O // Definitive measures in force on 31 December 1999

A. Ranked by product

B. Ranked by country

ANNEX P // Undertakings in force on 31 December 1999

A. Ranked by product

B. Ranked by country

ANNEX Q // Anti-dumping & anti-subsidy investigations pending on 31 December 1999 :

A. New investigations (ranked by product)

B. Review investigations (ranked by product)

C. Ranked by country (new & review investigations)

ANNEX R // Refunds during the period 1 January - 31 December 1999

ANNEX S // Court cases

A. Court cases pending before the Court of Justice and the Court of First Instance of the European Communities on 31 December 1999

B. Judgments and orders rendered by the Court of Justice and the Court of First Instance of the European Communities during 1999

Purpose and Aim

This report is submitted to the European Parliament following its Resolution of 16 December 1981 on the Community's anti-dumping activities [1], and the reports of the European Parliament's Committee on industry, external trade, research and energy [2]. The 1999 issue has been extended in scope in order to also offer an overview of certain other Community trade policy activities, in particular, the application of the Trade Barrier Regulation (TBR) and the activities in relation to the safeguard measures adopted by third countries and actions under the dispute settlement understanding of the World Trade Organisation. This extension has been done for two reasons. These activities are implemented by the services responsible for anti-dumping and anti-subsidy, and more important, anti-dumping, anti-subsidy and the other trade policy activities covered by the report, all have the same goal to ensure fair competition, not only within the European Community but also on the third country markets.

[1] OJ C 11, 18.1.1982, p 37.

[2] PE 141.178/fin of 30.11.1990, reporter Mr Gijs DE VRIES.

However, the anti-dumping and anti-subsidy activities remain the main subject of this report. It summarises developments in general policy and contains a concise commentary on each case initiated, each provisional and definitive measure taken, the reviews undertaken, and each case terminated without measures. It also provides information on the court cases relating to these trade policy instruments, and summarises the anti-dumping and anti-subsidy investigations carried out by other countries against the European Community or its Member States.

In 1999, there was a substantial increase in anti-dumping and anti-subsidy activities, which in particular is evidenced by the large number of new investigations opened (86), in comparison to 1998 (29) and previous years.

The present report analyses this development and concludes that it results in part from the economic crisis in Asia. As a consequence of the situation there, certain sensitive Community sectors, such as the iron and steel, electronics and chemical industries, found themselves facing a massive inflow on to their domestic markets of low-priced and/or subsidised imports. However, the evolution of the activities in 1999 was in line with that of the other main users of the anti-dumping and anti-subsidy instruments, notably the US. In addition, as the special circumstances of the Asian crisis are unlikely to be repeated, the increase in the number of new investigations in 1999 can be seen as being an exception to the normal trend, particularly as the practices of the Community institutions concerned in the interpretation and application of anti-dumping/anti-subsidy legislation have not changed.

The annexes to this report provide easy access to the activities in table form.

This report is also available to the general public. (Internet Website http://europa.eu.int/comm/dg01/trade10.htm)

1. Overview of anti-dumping and anti-subsidy legislation

1.1. The legal framework

1.1.1. The applicable law

1.1.1.1. The international framework

On an international level, unfair trading practices, such as dumping and the granting of subsidies, were identified as a threat to open markets as early as 1947, when the first GATT Agreement was signed. The agreement contained specific provisions allowing GATT members to take action against these practices if they caused material injury to the domestic industry of a GATT member.

Since that time, considerable efforts have been made to harmonise the rules relating to trade policy instruments. Particularly during the last GATT round (the so-called Uruguay Round), which led to the creation of the WTO and to detailed Anti-dumping and Anti-Subsidy Agreements, these efforts focused on the procedural rules as well as the material conditions to be fulfilled before protective measures can be taken. The Community played an active role in the negotiation of these relevant criteria which are reflected in its own legislation.

1.1.1.2. The Community legislation

The first Community anti-dumping and anti-subsidy legislation was enacted in 1968, and has subsequently been modified several times. The current basic Regulations (EC and ECSC), which form the legal basis of anti-dumping and anti-subsidy investigations in the Community, entered into force between March 1996 and April 1998 [3]. They are in line with the Anti-dumping and Anti-subsidy Agreements agreed upon in the GATT/WTO negotiations.

[3] Council Regulation (EC) No 384/96 of 22 December 1995 (OJ L 56, 6.3.1996), as last amended by Regulation (EC) No 905/98 (OJ L 128, 30.04.1998) and Commission Decision No 2277/96/ESCS of 28.11.1996 (OJ L 308, 29.11.1996) for anti-dumping, and Council Regulation (EC) No 2026/97 of 6 October 1997 (OJ L 288, 21.10.1997) and Commission Decision No 1889/98/ECSC of 3 September 1998 (OJ L 245, 4.9.1998) for anti-subsidies.

Furthermore, Community legislation contains a number of provisions aimed at ensuring a balanced application for all interested parties of the Community's anti-dumping and anti-subsidy rules. These provisions are the "Community interest test" and the "lesser duty rule".

The Community interest test corresponds to a public interest clause, and foresees that measures can only be taken if they are not contrary to the overall interest of the Community. This requires an appreciation of all the economic interests involved, including the interests of the domestic industry, users and consumers.

The lesser duty rule allows the measures imposed by the Community to be lower than the dumping or subsidy margin, if such a lower duty rate is sufficient to protect the Community industry adequately.

1.1.2. What is dumping and what are countervailable subsidies - the material conditions for the imposition of duties

1.1.2.1. Dumping and Subsidies

Dumping is traditionally defined as price discrimination between national markets, or as selling below cost of production. The Community's anti-dumping legislation defines dumping as selling a product in the Community at a price below its "normal value". This "normal value" is usually the actual sales price on the domestic market of the exporting country. Consequently, a company is selling at dumped prices if the prices on its home market are higher than its export prices (price discrimination).

However, if sales on the domestic market are not representative, for instance because they have only been made in small quantities, the normal value may be established on another basis, such as the sales prices of other producers on the domestic market, or the cost of production. In the latter case, a company is selling at dumped prices if its export prices are below the cost of production.

In the majority of cases where dumping occurs on a more than incidental basis, a certain market segregation exists. That segregation may be due to government regulation, but also to other circumstances, including consumer preferences. As a result, exporters are shielded, at least to a certain degree, from international competition on their domestic market.

Subsidies can have similar effects as sales at dumped prices. They consist of a direct support from a government, which confers a benefit to producers or exporters (e.g. grants, tax and duty exemptions, preferential loans at below commercial rates, export promotion schemes, which allow exporters to sell at low prices in the Community).

1.1.2.2. Material Injury and Causation

For measures to be taken against these unfair trading practices, it is not sufficient that companies are exporting their products to the Community at dumped or subsidised prices. Measures can only be taken if these exports cause material injury to Community producers, which cannot compete on an equal footing with the exporters.

Typical injury indicators are that the dumped and subsidised import volumes increase over a certain period and import prices undercut the sales prices of the Community industry. As a consequence, the latter is forced to decrease production volumes and sales prices, loses market shares, makes losses or has to make employees redundant. In the worst case, exporters may try to eliminate viable Community producers by using a predatory pricing strategy. In any event, the injury analysis requires that all relevant factors be taken into account before deciding whether the Community industry is suffering material injury.

Another condition for the imposition of measures is that the injury must be caused by the dumping or the subsidies. This condition is fulfilled when the deterioration of the situation of the Community industry coincides with the increase in dumped and subsidised imports. It is important to note that the dumped or subsidised imports do not have to be the only cause of the injury.

1.1.2.3. Community interest

Finally, it has to be established that the application of measures would not be contrary to the overall interest of the Community. In this respect, the interests of all relevant economic operators, which might be affected by the outcome of the investigation, are to be taken into account, the so-called Community interest test. In this context, the interest to preserve employment in the Community is carefully considered.

1.1.3. Procedure

Investigations are carried out in accordance with the procedural rules laid down in the basic Regulations. These rules guarantee a transparent, fair and objective proceeding by granting significant procedural rights to interested parties. In addition, the results of an investigation are published in the Official Journal of the European Communities, and the Community is obliged to justify its decisions in this publication. Finally, it is ensured that each case is decided on its merits and the Commission does not hesitate to terminate a case if the conditions to impose measures are not met.

Whereas each investigation is different, depending on the products and countries involved, all cases follow the same procedural rules, however certain preferential rules only apply to the Central and Eastern European Countries and Turkey. The rules relating to a new case are summarised below.

Initiation

A case normally starts with a sufficiently substantiated complaint from the Community industry. After receipt of this complaint, the Commission assesses whether the complaint contains sufficient evidence to allow for the initiation of the case. A case is opened by a notice of initiation published in the Official Journal. In this notice, all interested parties, including users and, where appropriate, consumer organisations, are invited to participate in the proceeding. Detailed questionnaires are sent to producers in the exporting countries and the Community, traders (in particular importers) and other interested parties, such as users. These parties are also informed that they can request a hearing and ask for access to the non-confidential files, which will help them to defend their case.

The investigation up to provisional measures

Following receipt of the replies to the questionnaire, investigations are carried out by Commission officials at the premises of the co-operating parties.

The purpose of these visits is to verify whether the information given in the questionnaire is reliable. The verified information is subsequently used to calculate the dumping margin, the price undercutting margin and injury elimination level. These calculations often involve the processing of thousands of transactions, and require a complex analysis of production costs.

The results of the calculations and the other findings are summarised in a working document, on the basis of which it is decided - after consultation of the Member States in the Advisory Committee - whether to impose provisional measures or to terminate the proceeding. In either eventuality, the decision at this stage is the Commission's responsibility.

The investigation up to definitive measures

Following the publication in the Official Journal of a Commission regulation imposing provisional duties, interested parties, who so request, receive a full disclosure, which allows them to verify the calculations of the Commission and to submit comments. Comments can also be made in a hearing. All submissions and comments are taken into account when a second, definitive, working document is prepared by the Commission.

After final disclosure and consultation of the Member States on the basis of the second working document, the Commission makes a proposal to the Council whether or not to confirm the provisional measures and impose definitive measures. Another possibility is that the Commission accepts undertakings offered by exporters, which undertake to respect minimum prices. In this case, no duties are imposed for the companies from which undertakings are accepted.

The Council decides on the adoption of the Commission proposal by simple majority vote, i.e. at least eight Member States have to be in favour of the Commission proposal. The regulation imposing definitive duties, and deciding on the collection of the provisional duties, is published in the Official Journal.

Timing

The procedure described above is subject to strict statutory deadlines. Thus, a decision to impose provisional duties must be taken within nine months of initiation and the total duration of an investigation is limited to fifteen months. This leads to significant time pressures, taking into account, inter alia, internal consultations and the necessity to publish regulations and decisions in all Community languages at the same time.

Anti-dumping or countervailing measures will normally remain in force for five years, and may consist of duties or undertakings concluded with exporters. Measures are taken on a countrywide basis, but individual treatment, i.e. the application of a company-specific duty, can be granted to exporters which have co-operated throughout the investigation. During the five-year period, interested parties may, under certain conditions, request a review of measures or the refund of anti-dumping duties paid. Measures may also be suspended for a certain period, subject to given criteria.

The anti-dumping and anti-subsidy regulations provide for administrative reviews and distinguish between interim reviews, newcomer reviews and expiry reviews. Those procedures are initiated normally only on the basis of the substantiated evidences and will normally not exceed 12 months in length .

The expiry review is intended to determine if the expiry of the measures would lead to continuation or recurrence of dumping and injury. During the five years period, the Commission may perform an interim review. Under the latter procedure, the Commission will consider whether the circumstances with regard to subsidy/dumping and injury have changed significantly or whether existing measures are achieving the intended results in removing the injury. Finally, the basic Regulations provide that a review shall be carried out to determine individual margins for new exporters in the exporting country concerned.

Judicial reviews:

The procedural rights of the parties, including hearing and access to non-confidential files, are respected in the course of the proceeding, and a system of judicial review exists to ensure their correct implementation. The competence to review anti-dumping and anti-subsidy cases lies with the Court of First Instance and the Court of Justice in Luxembourg. Furthermore, the possibility of recourse to the WTO dispute settlement mechanism exists for WTO members.

1.1.4. The anti-dumping and anti-subsidy services

Anti-dumping and anti-subsidy investigations are, among other responsibilities, carried out by Directorates C and E of Directorate General Trade in charge of external commercial policy. Whilst Directorate C deals with the dumping aspects of investigations, Directorate E covers the areas of injury and Community interest. In addition, Unit 3 in Directorate E is in charge of anti-subsidy investigations and the enforcement of the Trade Barrier Regulation.

1.2. Changes to the basic Regulations

The basic Regulations on anti-dumping and anti-subsidy were not amended during 1999. However, it was necessary to align some provisions of Decision No 2277/96/ECSC with those of Regulation (EC) No 384/96 in order to ensure consistency in the application of the anti-dumping rules provided under the EC and ECSC treaties respectively. To this end, the Commission adopted two sets of amendments by Decision No 1000/99/ECSC [4].

[4] Commission Decision No 1000/1999/ECSC of 11 May 1999 amending Decision No 2277/96/ECSC on protection against dumped imports from countries not members of the ECSC (OJ L 122, 12.5.1999).

Firstly, this new decision extends the reform of the anti-dumping basic Regulation contained in Regulation (EC) No 905/98 [5] to products under the ECSC. That reform allows for market economy status to be granted on an individual basis to companies in China and Russia (See 17th report, 1998, fn). Under Decision No 1000/99/ECSC, the criteria for such a status to be granted are exactly the same as under Regulation (EC) No 905/98.

[5] Council Regulation No 905/98 of 27 April 1998 amending Regulation No 384/96 on protection against imports from countries not members of the EU (OJ L 128, 30.4.1998).

Secondly, Article 1(2) of Decision No 1000/99/ECSC aligns Decision No 2277/96/ECSC with Regulation (EC) No 384/96 as amended by Regulation (EC) No 2331/96. More precisely, Decision No 1000/99/ECSC abolishes the exhaustive nature of the list of factors for adjustment for the purpose of the comparison between the normal value and the export price.

1.3. Implementation of Council Regulation (EC) No 905/98 related to individual Market Economy Status for companies in China and Russia

1.3.1. Regulation (EC) No 905/98 amending the anti-dumping basic Regulation

This regulation brought a new element into the regime applicable to cases involving China and Russia, affecting mainly the method applied for the assessment of normal value. The traditional approach is, in principle, maintained (i.e. based on prices and costs established in an analogue country), but a case-by-case approach is applied in investigations involving China and Russia whereby exporters may apply for market economy treatment.

Under the basic Regulation, companies may apply for individual market economy status. This status will be granted only if evidence is brought that

(a) decisions of applicant firms related to prices, costs, inputs, sales, investments are made in response to market signals and without significant State interference;

(b) firms have one clear set of basic accounting records independently audited in line with international accounting standards;

(c) the production costs and financial situation of firms are not subject to any significant distortions carried over from the former non-market economy system;

(d) firms are subject to bankruptcy and property laws which guarantee legal certainty and stability, and

(e) exchange rate conversions are carried out at the market rate.

These five criteria are cumulative.

1.3.2. Observations on the application of the new rule since 1 July 1998

Market economy status was granted in a very limited number of cases, due to the failure of the applicant companies to comply with the conditions set in the basic Regulation.

It appears from the early applications under Article 2(7) that most of the applicant companies did not have a clear set of accounting records or did not have any accounting records at all. In those cases, under no circumstances could the market economy status be granted, as the second criteria of Article 2(7) was clearly not fulfilled. Another factor that seems to have been determinant is the capacity of the company to sell on the domestic market. When the company was prevented by the State from doing so, such a restriction was understood as a clear infringement of the first criteria of Article 2(7), that is, the requirement that decisions by firms regarding, inter alia, sales are made in response to market signals reflecting supply and demand, and without significant state interference in this regard.

1.4. WTO dispute settlement in the field of anti-dumping and anti-subsidy

1.4.1. Definition of the WTO dispute settlement procedure

In line with the conclusions of the Uruguay Round, the WTO provides for a procedure for the settlement of disputes between WTO Member States on the application of certain WTO agreements. This was a major development for international trade law. The procedure is divided into two stages. The first stage is at the level of the Member States and consists of a bilateral consultation. Upon failure of the consultation, the second stage can be opened by consulting a special group ("panel"). The panel will publish a report, which can be appealed before the Appellate Body. Both the panel report and the report by the Appellate Body are deemed to be adopted by the Dispute Settlement Body unless the latter rejects the report by unanimity [6].

[6] Each appeal is heard by three members of a permanent seven-member Appellate Body set up by the Dispute Settlement Body. The Dispute Settlement Body has to accept or reject the appeals report within 30 days and rejection is only possible by consensus.

The Marrakech agreement identifies the specific WTO agreements that may be invoked for the initiation of the dispute settlement procedure. The dispute settlement procedure applies expressly to the agreements on anti-dumping and to the agreement on anti-subsidy and countervailing duties.

1.4.2. Panel proceedings involving EU anti-dumping and anti-subsidy activities

There are a number of pending consultations related to anti-dumping and anti-subsidy. Among them, five were initiated following a complaint by the EU. There are two pending cases challenging EU anti-dumping or anti-subsidy legislation. In addition, two panel reports and one interim report were adopted in 1999 in relation to anti-dumping and anti-subsidy. In each of those cases, the findings of the panel are relevant to EU anti-dumping and anti-subsidy policy, and support the Community's interpretation of the WTO rules.

(i) Case in which the EU is complaining party : WTO Panel on the imposition of countervailing duties on certain hot-rolled lead and bismuth carbon steel products originating in the United Kingdom. On 6 October 1999, the WTO Panel delivered its interim report in the above case. The Panel accepted the main arguments put forward by the Community and concluded that, by imposing countervailing duties on imports of leaded bars from the UK, produced by UES and British Steel plc (the privatised successors of the British Steel Corporation), the United States had violated Article 10 of the Subsidy and Countervailing Measures Agreement. Most importantly, the Panel established that an arm's length sale of assets for fair market value (whether in the context of a privatisation or a sale between private parties) eliminates the benefit of previous subsidisation, and rules out the imposition of further countervailing duties. This is a major victory for the Community, since the panel's findings will oblige the US to change its countervailing practice in this area, and calls into question the continued imposition of US countervailing duties, particularly on steel products, against several other Member States of the EU.

(ii) Other panel proceeding concerning anti-dumping: WTO panel on US anti-dumping duties on DRAMS from Korea. On 29 January 1999, the Dispute Settlement Body set up a panel on US anti-dumping duties on dynamic random access memory semi-conductors (DRAMS) from Korea [7]. Although this case did not involve the European Union, it is of particular interest for EU anti-dumping practice, as it effectively confirmed the conformity of certain aspects of the EU basic Regulation with the WTO Anti-dumping Agreement. Following a decision by the Department of Commerce not to revoke an anti-dumping order, Korea requested a panel on the basis that this decision was in violation of various provisions of the anti-dumping legislation. The panel assessed the compatibility of US anti-dumping legislation with, notably, Articles 11(2), 2(1) and 6(6) of the WTO Anti-Dumping Agreement. Most importantly, the Panel found that a risk of recurrence of dumping test should also be carried out in an interim review, although Article 11(2) of the WTO Agreement does not explicitly include any reference to an examination of dumping being likely to recur, as is the case with regard to injury. Thus, the Panel confirms the Community's practice in interim reviews.

[7] WT/DS99/R.

(iii) Panels initiated by third countries against the EU:

- Complaint by India against the EU regarding anti-dumping proceedings related to unbleached cotton fabrics from India. India alleges that the determination of standing, the initiation, the selection of the sample and the determination of dumping and injury are inconsistent with the EU's WTO obligations. (Pending consultation)

- Complaint by India against the EU regarding the imposition of anti-dumping duties on imports of cotton-type bed linen from India. India alleges that the determination of standing, the initiation, the determination of dumping and injury as well as the reasoning of the EU authorities' findings are inconsistent with the EU's WTO obligations. (Active Panel)

2. General overview of measures in force

At the end of 1999, the Community had 156 measures [8] in force, covering 63 products and 35 countries (see Annex O). Five of the measures related to anti-subsidy proceedings. Of the definitive measures, the large majority was in the form of duties; however, in a significant number of cases, in particular those relating to CEEC countries, undertakings were accepted.

[8] The measures are counted per product and country concerned.

Of the measures in force at the end of 1999, 33 concerned China, 11 Russia and 11 measures applied to non-market-economy countries, including Belarus and Kazakhstan with 2 measures and Ukraine with 7 measures. Eighteen measures (or 11,54%) concerned one or more of the 10 Central and Eastern European Countries (CEEC) [9].

[9] These countries are: Romania, Bulgaria, Slovak Republic, Czech Republic, Slovenia, Hungary, Poland, Latvia, Lithuania and Estonia.

For a more realistic view of the impact of anti-dumping measures, however, one has to look at the trade volume of the products concerned, which varies considerably depending on the product sector. The biggest trade volumes are often generated by high technology, such as electronics, which are high-value products. It should be noted that in 1999, 0,4% [10] of total imports into the Community is affected by anti-dumping or anti-subsidy measures.

[10] Source Comext

TABLE 1

Anti-dumping and anti-subsidy investigations

during the period 1 January 1995 - 31 December 1999 [11]

[11] The initiation of a case concerning several countries is accounted as separate investigations/proceedings per country involved.

>TABLE POSITION>

3. Initiations of Anti-dumping and Anti-subsidy Investigations

3.1. Introduction

The most notable characteristic of 1999 is the large number of new initiations in comparison with the previous year; in 1998, the Commission initiated 29 new investigations while, in 1999, new initiations reached 86. However, between 1995 and 1999, the number of new initiations has been rather stable and even decreased between 1997 and 1998, with respectively 45 and 29 new initiations (see Table 1).

This increase is particularly apparent concerning the sectors of chemical and allied products (with 0 new cases in 1998 and 28 in 1999), iron and steel (with 14 new cases in 1998 and 21 in 1999) and electronics (with 0 cases in 1998 and 10 in 1999).

Asian countries, with a smaller increase for countries of Central and Eastern Europe and the CIS. Furthermore, it should be emphasised that the proportion of anti-subsidy cases grew significantly, reaching 23% of all new investigations in 1999, having represented only 4% of the total in 1996.

Certain factors show a correlation between the Asian financial crisis and the surge in new investigations. The crisis started in April 1997 and directly affected Hong Kong, Indonesia, Japan, Malaysia, Taiwan, Thailand and South Korea. The main feature of the crisis was the collapse of domestic demand in South East Asia, especially in the steel sector. Domestic consumption in this region was depressed and countries became more dependent than ever on an export-based recovery.

Consequently, the crisis led to a surge in exports sold below cost or at subsidised prices. It is alleged that governments in South East Asia subsidised the maintenance of steel-making facilities, even in conditions of overcapacity. This allegation is lent credibility by the sudden growth in new anti-subsidy investigations, from 4 in 1997 to 20 in 1999, out of which 19 concerned South East Asia.

Ultimately, the decline in domestic consumption in South East Asia affected trade with countries traditionally exporting to this region. These countries were compelled to redirect exports into other available markets, mainly towards the US and the EU. In this context, reference is made to the increase in new investigations opened by the EU concerning the People's Republic of China and Taiwan.

It should be noted that the increase in new investigations in 1999 in the EU followed the same trend of the other main users of the anti-dumping and anti-subsidy instruments. For instance, the US initiated more investigations in 1999 than in 1998, with an increase from 46 in 1998 (36 anti-dumping and 10 anti-subsidy) to 56 in 1999 (46 anti-dumping and 10 anti-subsidy).

It would appear, however, that this growth in new cases should not be taken as a change of trend but rather as the result of very specific circumstances that are unlikely to be repeated.

In a global context where new countries are introducing and using anti-dumping and anti-subsidy instruments more and more, EU policy remains unchanged, and does not promote a broader use of anti-dumping and anti-subsidy regulations.

In conclusion, it is worth recalling that Community anti-dumping and anti-subsidy legislations contain strict requirements concerning the presentation of complaints and initiation of proceedings, particularly as regards evidence relating to the existence of dumping and injury caused thereof.

An overview of the new investigations initiated in 1999 is given in Annex A, whilst this section of the report gives a summary of each of these cases.

3.2. Cases

3.2.1. Flat rolled products of iron or non-alloy steel from Bulgaria, India, Iran, South Africa, the Federal Republic of Yugoslavia and Taiwan

The notice of initiation of the anti-dumping proceeding was published on 7 January 1999. The proceeding was initiated following a complaint lodged by Eurofer on behalf of the Community industry. The complaint was supported by more than 89% of the total Community production.

The allegation of dumping in respect of India, Iran, South Africa and Taiwan is based on a comparison of normal value, established on the basis of domestic prices, with the export prices of the product concerned to the Community.

The allegation of dumping for Bulgaria and the Federal Republic of Yugoslavia is based on a comparison of a constructed normal value with the export prices of the product concerned to the Community.

On this basis the dumping margins calculated are significant for all exporting countries concerned.

The complainant alleges and has provided evidence that imports of the product concerned from Bulgaria, India, Iran, South Africa, the Federal Republic of Yugoslavia and Taiwan have increased both in absolute terms and in terms of market share.

It is further alleged that the volumes and the prices of the imported product concerned have, among other consequences, had a negative impact on the quantities sold and the level of prices charged by the Community producers, resulting in substantial adverse effects on the financial situation of the Community industry.

3.2.2. Flat rolled products of iron or non-alloy steel from India, Taiwan and South Africa (AS)

The notice of initiation of the anti-subsidy proceeding was published on 8 January 1999. The proceeding was initiated following a complaint lodged by the European Confederation of Iron and Steel Industries (Eurofer) on behalf of the Community producers representing a major proportion of Community production of flat rolled steel coils.

The complaint contained evidence that producers and/or exporters of the product concerned have benefited from a number of subsidies granted by the Governments of India, South Africa, and Taiwan. The alleged subsidies are tax credits, corporate income tax exemptions, accelerated depreciation, import duty exemptions, loans at preferential interest rates, direct grants, and preferential transport and utility costs. They are alleged to be contingent on the use of domestic over imported goods, or to be otherwise limited to certain enterprises and are therefore specific and countervailable.

With regard to injury, it was alleged that imports of the product concerned from India, South Africa, and Taiwan have increased both in absolute terms and in terms of market share. Further, that the volume and the prices of these imports had, inter alia, a negative impact on the market share, the quantities sold, and the level of prices charged by the Community producers. It was alleged that these factors resulted in substantial adverse effects on the overall performance and the financial situation of the Community industry.

3.2.3. Yellow phosphorus from the People's Republic of China

The notice of initiation of the anti-dumping proceeding was published on 14 January 1999. The proceeding was initiated following a complaint lodged by Thermphos International BV, the sole producer of yellow phosphorus in the Community.

The proceeding constitutes the first full-scale investigation in application of the amended Article 2(7) of Council Regulation (EC) No 384/96 where the market economy status of Chinese exporting producers has to be examined if so requested.

The complainant proposed to base the calculation of dumping on a comparison of normal value established on the basis of domestic prices in the USA with the respective export prices of the product concerned to the EC. On this basis, the dumping margin calculated is significant.

The complainant alleged and provided evidence that the imports of the product concerned from the People's Republic of China had increased overall and in absolute terms of market share.

It was further alleged that the volume and the prices of the imported product had, among other consequences, had a negative impact on the quantity sold and the level of the prices charged by the Community producer, resulting in substantial adverse effects on the overall performance, the financial situation and the employment situation of the Community industry.

3.2.4. Television camera systems from the USA

The notice of initiation of the anti-dumping proceeding was published on 22 January 1999. The proceeding was initiated following a complaint lodged by Philips BTS Broadcast Television Systems BV representing a major proportion of the total Community production of television camera systems.

The allegation of dumping for the USA was based on a comparison of a constructed normal value with the export prices of the product concerned to the Community. On this basis, the dumping margin calculated was significant.

The complainant alleged and provided evidence that imports of the product concerned from the USA have increased overall in absolute terms and in terms of market share.

It was further alleged that the volumes and the prices of the imported product concerned have, among other consequences, had a negative impact on the quantities sold and the level of prices charged by the Community producers, resulting in substantial adverse effects on the overall performance, the financial situation and the employment situation of the Community industry.

3.2.5. Parts of television camera systems from Japan

The notice of initiation of the anti-dumping proceeding was published on 12 February 1999. The Commission decided to initiate a proceeding and open an investigation concerning imports of certain parts of television camera systems, originating in Japan.

In June 1998, the Commission opened an investigation into the circumvention of definitive anti-dumping duties imposed on imports of modules, kits, sub-assemblies and parts for television camera systems originating in Japan allegedly used in assembly operations in the Community.

The investigation was concluded by a proposal for termination without imposition of measures on the grounds of the withdrawal of the complaint. However, information made available to the Commission in that investigation indicated that there is prima facie evidence of dumping, injury and a causal link, as described in Article 5(2) of the basic Regulation. In these special circumstances, the Commission decided to initiate a new anti-dumping proceeding on the basis of Article 5 of the basic Regulation.

3.2.6. Compact-disc boxes from the People's Republic of China

The notice of initiation of the anti-dumping proceeding was published on 5 March 1999. The proceeding was initiated following a complaint lodged by the European Plastics Converters (EuPC) on behalf of the Community industry. The complaint was supported by a total of eight companies.

The complaint contained evidence of significant dumping based on a comparison of normal value, established on the basis of the price in a market economy third country (Thailand), with the export price of the product concerned to the Community.

With regard to injury, evidence was provided that imports from the People's Republic of China had increased overall in absolute terms and in terms of market share. It was further alleged that the volumes and the prices of the imported products had a negative impact on the quantities sold and the level of prices charged by the Community producers, resulting in substantial adverse effects on the overall performance and the financial situation of the Community industry.

3.2.7. Video tapes on reels from the Republic of Korea

The notice of initiation of the anti-dumping proceeding was published on 11 March 1999. The proceeding was initiated following a complaint lodged by the Video Pancake Manufacturers Association (VIPAM) on behalf of the Community industry. The complaint was supported by producers representing more than 70% of the total Community production of videotapes on reels.

The allegation of dumping was based on a comparison of a constructed normal value with the export prices of the product concerned to the Community. On this basis, the dumping margins were substantial.

The complainant alleged and provided evidence that imports from Korea have increased significantly in absolute terms and in terms of market share. It was further alleged that the volume and prices of the imported product had, among other consequences, a negative impact on the quantities sold and the prices charged by the Community producers, resulting in a substantial adverse effect on the financial situation of the Community industry.

3.2.8. Synthetic fibres of polyester from Australia, Indonesia and Thailand

The notice of initiation of the anti-dumping proceeding was published on 22 April 1999. The proceeding was initiated following a complaint lodged by the International Rayon and Synthetic Fibres Committee on behalf of the Community industry. The complaint was supported by a total of 9 companies.

The allegation of dumping for Australia, Indonesia and Thailand was based on a comparison of a constructed normal value in these countries with the export prices of the product concerned to the Community. In its complaint, the International Rayon and Synthetic Fibres Committee provided also evidence that imports of the product concerned from Australia, Indonesia and Thailand increased overall in absolute terms and in terms of market share. It was alleged that the volumes and the prices of the imported product concerned have, among other consequences, had a negative impact on the market share and the level of prices charged by the Community producers, resulting in substantial adverse effects on the financial situation of the Community industry.

3.2.9. Synthetic fibres of polyester from Australia, Indonesia, the Republic of Korea, Taiwan and Thailand (AS)

The notice of initiation of the anti-subsidy proceeding was published on 22 April 1999. The proceeding was initiated following a complaint lodged by the International Rayon and Synthetic Fibres Committee (CIRFS) on behalf of a major proportion of the Community industry, i.e. producers representing more than 85% of the total Community production.

The complaint contained sufficient evidence of the existence of countervailable subsidised imports that cause material injury to the Community industry. Consultations according to Article 10(9) of Council Regulation (EC) No 2026/97 were held with the Governments of Australia, Indonesia, Korea, Taiwan and Thailand in Brussels prior to the initiation of this proceeding.

3.2.10. Hot-rolled flat products of non-alloy steel from India, the People's Republic of China and Romania

The notice of initiation of the anti-dumping proceeding was published on 13 May 1999. The proceeding was initiated following a complaint lodged by Eurofer on behalf of the Community industry. The complaint was supported by a total of 77% of the total Community production.

The allegation of dumping in respect of India is based on a comparison of normal value established on the basis of domestic prices in this country with the export prices of the product concerned to the Community.

The allegation of dumping for Romania is based on a comparison of a constructed normal value with the export prices of the product concerned to the Community.

As regards the People's Republic of China, in view of the fact that normal value will be established pursuant to Article 2(7)(a) of the basic Decision, save where exporting producers satisfy the conditions set out in Article 2(7)(c) of this Decision, the complainant has proposed that normal value be established on the basis of the price in a market economy third country.

On this basis, the dumping margins calculated are significant for all exporting countries concerned.

The complainant alleges and has provided evidence that the imports from the People's Republic of China, India and Romania have increased overall in absolute terms and in terms of market share.

It is further alleged that the volume and the prices of the imported product have, among other consequences, had a negative impact on the quantities sold and the level of prices charged by the Community producers, resulting in a substantial adverse effect on the financial situation of the complainant Community industry.

3.2.11. Steel wire rod from Turkey

The notice of initiation of the anti-dumping proceeding was published on 22 May 1999. The proceeding was initiated following a complaint lodged by Eurofer on behalf of the Community industry. The complaint was supported by producers representing a major proportion of total Community production.

The allegation of dumping is based on a comparison of normal value, established on the basis of domestic prices, with the export prices of the product concerned to the Community. On this basis, the dumping margin calculated is significant.

The complainant has provided evidence that imports of the product concerned from Turkey have increased overall in absolute terms and in terms of market share.

It is alleged that the volumes and the prices of the imported product concerned have, among other consequences, had a negative impact on market share and the level of prices charged by the Community producers, resulting in substantial adverse effects on the overall performance and the financial situation of the Community industry.

3.2.12. Malleable cast iron tube or pipe fittings from Brazil, Croatia, the Czech Republic, the Federal Republic of Yugoslavia, Japan, the People's Republic of China, the Republic of Korea and Thailand

The notice of initiation of the anti-dumping proceeding was published on 29 May 1999. The proceeding was initiated following a complaint lodged by the Defence Committee of Malleable Cast Iron Tube or Pipe Fittings Industry of the European Union on behalf of the Community industry. The complaint was supported by a total of six companies.

The allegation of dumping in respect of Brazil, the Czech Republic, Japan, the Republic of Korea and Thailand was based on a comparison of normal value established on the basis of domestic prices with the export prices of the product concerned to the Community.

The allegation of dumping for Croatia and the Federal Republic of Yugoslavia was based on a comparison of a constructed normal value with the export prices of the product concerned to the Community.

For China, the complainant proposed to base the calculation of dumping on a comparison of normal value established on the basis of domestic prices in Poland with the respective export prices of the product concerned to the EU.

On this basis, the dumping margins calculated are significant for all exporting countries concerned.

The complainant alleged and provided evidence that imports of the product concerned from Brazil, Croatia, the Czech Republic, the Federal Republic of Yugoslavia, Japan, the People's Republic of China, the Republic of Korea and Thailand had increased overall in absolute terms and in terms of market share.

It was further alleged that the volume and prices of the imported product had, among other consequences, had a negative impact on the market share and the level of prices charged by the Community producers, resulting in substantial adverse effects on the overall performance, the financial situation and the employment situation of the Community industry.

3.2.13. Solutions of urea and ammonium nitrate from Algeria, Belarus, Lithuania, Russia, the Slovak Republic and Ukraine

The notice of initiation of the anti-dumping proceeding was published on 26 June 1999. The proceeding was initiated following a complaint lodged by the European Fertiliser Manufacturers Association on behalf of the Community industry. The complaint was supported by producers representing a major proportion, i.e. more than 99,8%, of the total Community "integrated" production of urea ammonium nitrate.

The complaint contained evidence of significant dumping based on a comparison of normal values established on the basis of a constructed value in Algeria and Lithuania, on domestic prices in the Slovak Republic, and on domestic prices of the proposed analogue country (USA) for Belarus, Ukraine, and Russia with the export prices of the product concerned to the Community.

With regard to injury, it was alleged that the imports of the product concerned from Algeria, Belarus, Lithuania, Russia, Slovak Republic and Ukraine have increased overall in absolute terms and in terms of market share. It was further alleged that the volumes and the prices of the imported product concerned have, among other consequences, had a negative impact on the market share and the level of prices charged by the Community producers, resulting in substantial adverse effects on the financial situation of the Community industry.

3.2.14. Stainless steel fasteners from Malaysia, Singapore, the Philippines and Thailand (AS)

The notice of initiation of the anti-subsidy proceeding was published on 26 June 1999. The proceeding was initiated following a complaint lodged by the European Industrial Fasteners Institute (EIFI) on behalf of a major proportion of the Community industry, i.e. producers representing more than 67% of the total Community production.

The complaint contained sufficient evidence of the existence of countervailable subsidised imports that cause material injury to the Community industry. Consultations according to Article 10(9) of Council Regulation (EC) No 2026/97 were held with the Government of Malaysia in Brussels prior to the initiation of this proceeding.

3.2.15. One Dye Black 1 (ODB-1) from Japan

The notice of initiation of the anti-dumping proceeding was published on 24 July 1999. This proceeding was initiated following a complaint lodged by the European Chemical Industry Council (CEFIC) on behalf of the sole producer in the Community.

The product allegedly being dumped is a certain colorformer, generally known as ODB-1, whose chemical definition falls under Chemical abstract number 29512-49-0. ODB-1 is mainly used in conjunction with other chemicals to coat paper, which can then be used as carbonless copying paper.

The complaint contained evidence of significant dumping.

The complaint provided evidence that imports of the product concerned from Japan had increased overall in absolute terms and in terms of market share, and that those volumes and the prices of the imports had had a negative impact on the Community industry's market share, the quantities sold and the level of prices charged.

3.2.16. One Dye Black 2 (ODB-2) from Japan

The notice of initiation of the anti-dumping proceeding was published on 24 July 1999. The proceeding was initiated following a complaint lodged by the European Chemical Industry Council (CEFIC) on behalf of the sole producer in the Community.

The product allegedly being dumped as a certain colorformer, generally known as ODB-2, whose chemical definition falls under Chemical abstract number 89331-94-2. ODB-2 is mainly used in conjunction with other chemicals to coat paper, which can then be used for thermal image applications.

The complaint contained evidence of significant dumping.

The complaint provided evidence that imports of the product concerned from Japan had increased overall in absolute terms, and that those volumes and the prices of the imports had had a negative impact on the quantities sold and the level of prices charged by the Community industry.

3.2.17. Cathode-ray colour television picture tubes from the People's Republic of China, India, the Republic of Korea, Lithuania and Malaysia

The notice of initiation of the anti-dumping proceeding was published on 29 July 1999. The product scope defined therein was further clarified by a notice published on 20 October 1999. The proceeding was initiated following a complaint lodged by the Taskforce against Unfair Business in Europe (TUBE), on behalf of the sole producer of the product concerned in the Community.

The allegation of dumping was based on a comparison of normal value with the export prices of the product concerned to the Community. The normal value in respect of India and Malaysia was established on the basis of domestic prices, while for Lithuania and the Republic of Korea constructed normal values were used. The comparison for the People's Republic of China was based on the normal value established for India, which was proposed by the complainant as an appropriate market economy third country. On this basis, the dumping margins were substantial.

The complainant alleged and provided evidence that imports from the countries concerned had increased overall in terms of market shares. It was further alleged that the volumes and the prices of the imported product had, among other consequences, had a negative impact on the market share and the level of prices charged by the Community producers, resulting in substantial adverse effects on the financial situation of the Community industry.

3.2.18. Hair brushes from the People's Republic of China, Hong Kong, the Republic of Korea, Taiwan and Thailand

The notice of initiation of the anti-dumping proceeding was published on 13 August 1999. The proceeding was initiated following a complaint lodged by the Fédération Européenne des Industries de la Brosserie et de la Pinceauterie (FEIBP) on behalf of the Community industry. The complaint was supported by more than 70% of total Community production.

The allegation of dumping in respect of Hong Kong, Taiwan and Thailand is based on a comparison of normal value, established on the basis of domestic prices, with the export prices of the product concerned to the Community.

The allegation of dumping for the Republic of Korea is based on a comparison of a constructed normal value with the export prices of the product concerned to the Community.

In view of the fact that normal value for the People's Republic of China will be established on the basis of the rules set out in Article 2(7)(a) of the basic Regulation for those exporting producers which cannot meet the conditions set out in Articles 2(7)(b) and (c) of that Regulation, the complainant has proposed that normal value be established on the basis of the price in a market economy third country, i.e. Argentina. The allegation of dumping is based on a comparison of normal value, as set out above, with the export prices of the product concerned when sold for export to the Community.

On this basis, the dumping margins calculated are significant for all exporting countries concerned.

The complainant has provided evidence that imports of the product concerned from the People's Republic of China, Hong Kong, the Republic of Korea, Taiwan and Thailand have increased overall in absolute terms and in terms of market share.

It is alleged that the volumes and the prices of the imported product concerned have, among other consequences, had a negative impact on the quantities sold and the level of prices charged by the Community producers, resulting in substantial adverse effects on the overall performance and the financial situation of the Community industry.

3.2.19. Glycine from the People's Republic of China

The notice of initiation of the anti-dumping proceeding was published on 24 August 1999. The proceeding was initiated following a complaint lodged by the European Chemical Industry Council (CEFIC) on behalf of the sole producer of glycine in the Community.

In view of the fact that the People's Republic of China was considered to be a non-market economy, the complainant proposed that normal value be established on the basis of constructed value in a market economy third country, i.e. India. The allegation is based on a comparison of normal value, as set out above, with the export prices of the product concerned from the People's Republic of China when sold to the Community. On this basis the dumping margin calculated is substantial.

Exporting producers in the People's Republic of China were notified that the normal value may be determined on the basis of prices and costs in China if they can show, by submitting a properly substantiated claim, that in their case market economy conditions prevail for the manufacturing and sales of the product concerned. Two claims that were submitted by Chinese exporting producers failed to substantiate that in their case market economy conditions prevail.

With regard to injury, it was alleged that imports from the People's Republic of China increased significantly in absolute terms and in terms of market share. It was further alleged that the volume and prices of the imported product have, among other consequences, had a negative impact on the market share, the quantities sold and the prices charged by the Community producer, resulting in substantial adverse effects on its overall performance and financial situation.

3.2.20. Styrene-butadiene-styrene (SBS) thermoplastic rubbers from Taiwan (AS)

The notice of initiation of the anti-subsidy proceeding was published on 26 August 1999. The proceeding was initiated following a complaint lodged by the European Chemical Industry Council (CEFIC) on behalf of Community producers representing a major proportion of Community production of styrene-butadiene-styrene thermoplastic rubbers.

The complaint contained evidence that producers and/or exporters of the product concerned have benefited from a number of subsidies granted by the Government of Taiwan. The alleged subsidies are tax credits, corporate income tax exemptions, accelerated depreciation, import duty exemptions and loans at preferential interest rates. They are alleged to be contingent on the use of domestic over imported goods, or otherwise limited to certain enterprises and therefore specific and countervailable.

With regard to injury, it was alleged that imports of the product concerned from Taiwan have increased overall in absolute terms and in terms of market share, and that the volume and the prices of the imports, among other consequences, had a negative impact on the market share, the quantities sold and the level of prices charged by the Community producers, resulting in substantial adverse effects on the overall performance and the financial situation of the Community industry.

3.2.21. Styrene-butadiene-styrene (SBS) thermoplastic rubbers from Taiwan

The notice of initiation of the anti-dumping proceeding was published on 26 August 1999. The proceeding was initiated following a complaint lodged by the European Chemical Industry Council (CEFIC) on behalf of the Community industry. The complaint was supported by producers representing the total Community production of SBS thermoplastic rubbers.

The allegation of dumping was based on a comparison of normal value established on the basis of domestic prices in Taiwan with the export prices of the product concerned to the Community. On this basis, the dumping margins were significant.

The complainant alleged and provided evidence that imports from Taiwan have increased significantly in absolute terms and in terms of market share. It was further alleged that the volume and prices of the imported product had, among other consequences, a negative impact on the quantities sold and the prices charged by the Community producers, resulting in a substantial adverse effect on the financial situation of the Community industry.

3.2.22. Electronic weighing scales from the People's Republic of China, the Republic of Korea and Taiwan

The notice of initiation of the anti-dumping proceeding was published on 16 September 1999. The proceeding was initiated following a complaint lodged by Community producers representing more than 50% of the total Community production of the electronic weighing scales concerned.

The allegation of dumping for Korea and Taiwan was based on a comparison of a constructed normal value with the export prices of the product concerned to the Community. For the People's Republic of China normal value will be established pursuant to Article 2(7) of the basic Regulation. For exporters unable to meet the conditions set out in Articles 2(7)(b) and (c) of the basic Regulation, the complainant proposed to base the calculation of dumping on a comparison of a constructed normal value in Indonesia with the respective export prices to the Community. On this basis, the dumping margins were substantial.

The complainant alleged and provided evidence that imports from the People's Republic of China, Korea and Taiwan have increased significantly in terms of market share. It was further alleged that the volume and prices of the imported product had, among other consequences, a negative impact on the market share and the prices charged by the Community producers, resulting in a substantial adverse effect on the financial situation of the Community industry.

3.2.23. Woven glass fibre fabrics from Taiwan (AS)

The notice of initiation of the anti-subsidy proceeding was published on 16 September 1999. The proceeding was initiated following a complaint lodged by the European Apparel and Textile Organisation (Euratex) on behalf of producers representing 100% of the total Community production.

The complaint contained sufficient evidence of the existence of countervailable subsidised imports, which cause material injury to the Community industry. The Government of Taiwan submitted to the Commission its views on the complaint prior to the initiation of this proceeding.

3.2.24. Coke over 80 mm from the People's Republic of China

The notice of initiation of the anti-dumping proceeding was published on 16 September 1999. The proceeding was initiated following a complaint lodged by EUCOKE-EEIG on behalf of the Community industry. The complaint was supported by a total of six companies.

The complainant proposed to base the calculation of dumping on a comparison of normal value established on the basis of domestic prices in the USA with the respective export prices of the product concerned to the EU. On this basis, the dumping margin calculated is significant.

The complainant alleged and provided evidence that imports of the product concerned from the People's Republic of China had increased overall in absolute terms of market share.

It was further alleged that the volumes and the prices of the imported product had, among other consequences, had a negative impact on the market share, the quantities sold and the level of prices charged by the Community producers, resulting in substantial adverse effects on the overall performance and the financial situation of the Community industry.

3.2.25. Polyester staple fibres from the Republic of Korea

The notice of initiation of the anti-dumping proceeding was published on 7 October 1999. The proceeding was initiated following a complaint lodged by the International Rayon and Synthetic Fibres Committee on behalf of the Community industry. The complaint was supported by a total of 8 companies.

The allegation of dumping was based on a comparison of a constructed normal value with the export prices of the product concerned to the Community. In its complaint, the International Rayon and Synthetic Fibres Committee provided also evidence that imports of the product concerned from the Republic of Korea increased overall in absolute terms and in terms of market share. It was alleged that the volumes and the prices of the imported product concerned have, among other consequences, had a negative impact on the market share and the level of prices charged by the Community producers, resulting in substantial adverse effects on the overall performance of the Community industry.

3.2.26. Ammonium nitrate from Lithuania, Poland and Ukraine

The notice of initiation of the anti-dumping proceeding was published on 29 October 1999. The proceeding was initiated following a complaint lodged by the European Fertiliser Manufacturers Association on behalf of the Community industry. The complaint was supported by 11 producers representing a major proportion, i.e. 96%, of the total Community production of ammonium nitrate.

The complaint contained evidence of significant dumping based on a comparison of normal values established on the basis of a constructed value in Lithuania, and on domestic prices in Poland with the export prices of the product concerned to the Community.

With regard to injury, it was alleged that imports from Lithuania, Poland and Ukraine had increased significantly in terms of volumes and of market share. It was further alleged that the volumes and the prices of the imported product concerned have had, among other consequences, a negative impact on the market share and the level of prices charged by the Community producers, resulting in substantial adverse effects on the financial situation of the Community industry.

3.2.27. Bicycle forks from the People's Republic of China and Taiwan

The notice of initiation of the anti-dumping proceeding was published on 5 November 1999. The proceeding was initiated following a complaint lodged by the European Bicycle Manufacturers Association (EBMA) on behalf of producers representing more than 55% of the total Community production of bicycle forks. The complaint was supported by a total of 47 companies.

The allegation of dumping for Taiwan was based on a comparison of a constructed normal value with the export price of the product concerned to the Community. The complainant based its allegation of dumping in respect of the People's Republic of China on a comparison of a normal value in a market economy third country, Mexico, with the export price of the product concerned when sold for export to the Community. On this basis, the dumping margins calculated were significant.

The complainant provided evidence that imports of the product concerned from the People's Republic of China and Taiwan had increased overall and in terms of market share.

It was alleged that the volumes and the prices of the imported product concerned had, among other consequences, a negative impact on the market share and the level of prices charged by the Community producers, resulting in substantial adverse effects on their financial situation and on the employment situation in the Community industry.

3.2.28. Bicycle frames from the People's Republic of China and Taiwan

The notice of initiation of the anti-dumping proceeding was published on 5 November 1999. The proceeding was initiated following a complaint lodged by the European Bicycle Manufacturers Association (EBMA) on behalf of producers representing more than 55 % of the total Community production of bicycle frames. The complaint was supported by a total of 47 companies.

The allegation of dumping for Taiwan was based on a comparison of a constructed normal value with the export price of the product concerned to the Community. The complainant based its allegation of dumping in respect of the People's Republic of China on a comparison of a normal value in a market economy third country, Mexico, with the export price of the product concerned when sold for export to the Community. On this basis, the dumping margins calculated were significant.

The complainant provided evidence that imports of the product concerned from the People's Republic of China and Taiwan had increased overall and in terms of market share.

It was alleged that the volumes and the prices of the imported product concerned had, among other consequences, a negative impact on the market share and the level of prices charged by the Community producers, resulting in substantial adverse effects on their financial situation and on the employment situation in the Community industry.

3.2.29. Bicycle wheels from the People's Republic of China

The notice of initiation of the anti-dumping proceeding was published on 5 November 1999. The proceeding was initiated following a complaint lodged by the European Bicycle Manufacturers Association (EBMA) on behalf of producers representing more than 55% of the total Community production of complete wheels of bicycles. The complaint was supported by a total of 47 companies.

The complainant based its allegation of dumping on a comparison of a normal value in a market economy third country, Mexico, with the export price of the product concerned when sold for export to the Community. On this basis, the dumping margin calculated was significant.

The complainant provided evidence that imports of the product concerned from the People's Republic of China had increased overall and in terms of market share.

It was alleged that the volumes and the prices of the imported product concerned had, among other consequences, a negative impact on the market share and the level of prices charged by the Community producers, resulting in substantial adverse effects on their financial situation and on the employment situation in the Community industry.

3.2.30. Polyethylene terephthalate (PET) from India, Indonesia, Malaysia, the Republic of Korea, Taiwan and Thailand

The notice of initiation of the anti-dumping proceeding was published on 6 November 1999. The proceeding was initiated following a complaint lodged by the Polyethylene Terephthalate (PET) Committee of the Association of Plastic Manufacturers in Europe (A.P.M.E.) on behalf of the Community industry. The complaint was supported by a total of seven companies.

The allegation of dumping was based, in absence of sufficient information on prices in the domestic market, on a comparison of a constructed normal value with the export prices of the product concerned to the Community. On this basis, the dumping margins calculated were significant for all six exporting countries.

The complainant alleged and provided evidence that imports from India, Indonesia, Malaysia, the Republic of Korea, Taiwan and Thailand had increased significantly in absolute terms and in terms of market share.

It was further alleged that the volume and prices of the imported product had, among other consequences, a negative impact on the market share and the level of the prices charged by the Community producers, resulting in a substantial adverse effect on the overall performance and the financial situation of the Community industry.

3.2.31. Polyethylene terephthalate (PET) from India, Indonesia, Malaysia, the Republic of Korea, Taiwan and Thailand (AS)

The notice of initiation of the anti-subsidy proceeding was published on 6 November 1999. The proceeding was initiated following a complaint lodged by the Polyethylene Terephthalate (P.E.T.) Committee of the Association of Plastic Manufacturers in Europe on behalf of producers representing 85% of the Community production of polyethylene terephthalate.

The complaint contained evidence that the exporting producers in the countries concerned benefit from a number of subsidies (estimated at between 10% and 43% of the value of the product depending on the country concerned) which appear to be countervailable under the provisions of Article 3 of the basic Regulation. These subsidies include tax credits/exemptions, loans at preferential interest rates, accelerated depreciation, imports of raw materials and machinery free of customs duties.

As regards injury, it was alleged that imports of the product concerned from these countries have increased overall in absolute terms and in terms of market share, and that the volume and the prices of the imports, among other consequences, had a negative impact on the market share, the quantities sold and the level of prices charged by the Community producers, resulting in substantial adverse effects on the overall performance and the financial situation of the Community industry.

Concerning Saudi Arabia, the Commission considered that the exports from this country should be excluded from the scope of the investigation since the volume of imports constituted only 3,5% of total imports. The Commission decided that the import volume was de minimis.

3.2.32. Polyester staple fibres from India

The notice of initiation of the anti-dumping proceeding was published on 21 December 1999. The proceeding was initiated following a complaint lodged by the International Rayon and Synthetic Fibres Committee on behalf of the Community industry. The complaint was supported by a total of 8 companies.

The allegation of dumping was based on a comparison of a constructed normal value with the export prices of the product concerned to the Community. In its complaint, the International Rayon and Synthetic Fibres Committee provided also evidence that imports of the product concerned from India increased overall in absolute terms and in terms of market share. It was alleged that the volumes and the prices of the imported product concerned have, among other consequences, had a negative impact on the market share and the level of prices charged by the Community producers, resulting in substantial adverse effects on the overall performance of the Community industry.

4. Provisional measures

4.1. Overview

In 1999, provisional duties were imposed in 17 proceedings involving imports from 10 different countries. As shown in Table 1 (see point 2), this figure compares to 30 in 1998 and 33 in 1997. An overview of the provisional duties imposed in 1999 is given in Annex D where it can be seen that India featured most prominently with 5 investigations. This section of the report gives a summary of each of these cases.

4.2. Cases

4.2.1. Steel ropes and cables from the People's Republic of China, Hungary, India, Mexico, Poland, South Africa and Ukraine

On 19 February 1999, the Commission imposed a provisional anti-dumping duty on imports of steel ropes and cables originating in the People's Republic of China, India, Mexico, South Africa and the Ukraine and accepted undertakings offered by certain exporting producers in Hungary and Poland. The proceeding had been initiated in May 1998 following a complaint lodged by the Liaison Committee of European Union Wire Rope Industries (EWRIS) acting on behalf of twenty three Community producers representing a major proportion of the total production of steel ropes and cables in the Community. The value of total imports of ropes and cables from the countries concerned during the investigation period (from 1 January 1997 to 31 March 1998) amounted to 40.017 million ECU.

Dumping

As far as the exporting producers in the market-economy countries subject to the investigation were concerned, the comparison of normal value with the export prices revealed, for the investigation period, the existence of dumping in all cases. The provisional dumping margins established ranged from 0,1% to 132%.

Since the People's Republic of China and the Ukraine are non-market economy countries, the Commission determined the normal value on the basis of data obtained from producers in a market economy country. Since it appeared that the country proposed by the complainant was not an appropriate analogue country and since no co-operation could be obtained from alternative market-economy countries outside the scope of the investigation, it was therefore decided to have recourse to a country subject to the investigation. Since India was considered the most appropriate analogue country, normal value was based on the weighted average of normal values established for the co-operating Indian exporting producers. The provisional dumping margins thus established were 54,8% and 74,8%.

Injury and causation of injury

Certain exporters argued that one Community producer should be excluded from the definition of the Community industry as its related companies had imported the product concerned during the period under investigation. Despite this import activity, it was established that the principal activity of this Community producer was the production of the product concerned. Furthermore, it was found that this Community producer had not benefited unduly from these imports nor had it been shielded from the effects of the injurious dumping. The Community producer in question was therefore not excluded from the definition of the Community industry.

Given the large number of producers in the Community industry, injury was assessed on the basis of a sample of companies in the Community industry. This sample was chosen on the basis of geographic location and size of the companies in terms of production.

Certain exporters argued against the cumulation of imports from Hungary and Mexico. It was, however, established that the conditions for cumulation were met as concerns imports from all countries concerned, with the exception of South Korea. This argument was therefore rejected.

The investigation showed that despite an increase in consumption of 5%, the Community industry suffered a decrease in sales, market share, employment and profitability. The Commission concluded that the Community industry had suffered material injury resulting in particular from the significant undercutting practised by the countries concerned and the increasing quantities imported from these countries.

Certain exporters argued that the injury suffered by the Community industry was caused by its own imports of the product concerned. This argument was rejected given that these imports corresponded to the standard commercial practice of producers having to supplement their range of manufactured products with a small proportion of purchased goods.

A clear causal link was established between the dumped imports and the material injury suffered by the Community industry and no other factors were considered to have been such as to break this causal link.

Community interest

It was concluded that in the absence of anti-dumping measures the increases in dumped imports would in all likelihood continue and further aggravate the injury suffered by the Community industry. Any price increase in the product concerned resulting from the imposition of anti-dumping measures, was expected to only have a marginal impact on the user industries. It was therefore concluded that there were no compelling reasons not to impose anti-dumping measures.

Measures and undertakings

The injury margins were found to be higher than the dumping margins established for all exporting producers except for the Mexican and the South African exporting producers. The provisional duty rates were therefore based on the dumping margins, except for the Mexican and South African exporting producers for whom the injury margins applied. The rates of duty imposed ranged from 0% to 74,8%. Undertakings were offered by the Hungarian and Polish exporting producers and the Commission accepted these.

4.2.2. Stainless steel wire having a diameter of less than 1 mm from India and the Republic of Korea (AS)

On 24 March 1999, the Commission imposed a provisional countervailing duty on imports of stainless steel wire having a diameter of less than 1 mm originating in India and the Republic of Korea. The proceeding had been initiated in June 1998 following a complaint lodged by the European Confederation of Iron and Steel Industries (Eurofer), representing a number of the Community producers of the product concerned. The value of the total imports of stainless steel wire having a diameter of less than 1 mm from the countries concerned during the period of investigation (12 months) amounted to 538.860 Euro.

Subsidisation

In respect of India, the complainant alleged that five schemes involved the granting of countervailable subsidies to the exporters. These schemes are the Passbook Scheme, the Duty Entitlement Passbook Scheme, the Export Promotion Capital Goods Scheme, the Export Processing Zones/Export Oriented Units Scheme, and the Income Tax Scheme. Following an investigation of these schemes, it was found that four of the schemes benefited at least some of the exporters of the product concerned. With the exception of the Export Processing Zones/Export Oriented Units Scheme, the investigation found that all of the schemes are countervailable under Regulation (EC) No 2026/97 because they all involve a financial contribution from the Indian Government in the form of revenue forgone, and they confer a benefit on the companies concerned by relieving them of certain costs. The subsidies are all contingent upon export performance and are therefore specific under the provisions of the basic Regulation.

Concerning the total amount of benefit received by the co-operating Indian exporters during the investigation period, it was found that one of the exporters received no benefit from the schemes. For the eight others, the subsidy ranged from 10,1% to 43,0%.

In respect of Korea, the complainant alleged that nine schemes involved the granting of countervailable subsidies to the exporters. These schemes are policy loans, export financing loans, Government direction of commercial loans, Government direction of foreign currency loans, tax schemes, a duty drawback scheme, the supply of electricity without adequate remuneration, ad-hoc subsidies and equity infusions, and debt forgiveness. Following an investigation of these schemes, it was found that the loan schemes, the tax schemes, and the duty drawback scheme benefited at least some of the exporters of the product concerned.

The investigation further found that these schemes are countervailable under Regulation (EC) No 2026/97 because they involve a financial contribution from the Government of Korea in the form of revenue forgone, a