Proposal for a COUNCIL REGULATION (EC) imposing definitive anti-dumping duties on imports of fluorspar originating in the People' s Republic of China and collecting definitively the provisional anti-dumping duty
Date: 1994-02-04
Institutions: European Commission
Subjects: China, anti-dumping duty, anti-dumping legislation, dumping, import, metallic ore

COMMISSION  OF  THE  EUROPEAN  COMV1UNITIES 

C0MC94) 27 final 
Brussels, 04.02.1994 

Proposal  for a 

COUNCIL  REGULATION  (EC) 

imposing definitive anti-dumping duties on imports of fluorspar 

originating in the People's Republic of china and 

collecting definitively the provisional 

anti-dumping  duty 

(presented  by  the Commission) 

IL: 

# 

mm 

-.A-

E X P L A N A T O RY 

M E M O R A N D UM 

(1) Commission  Regulation  (EEC)  N"  2463/93*)  imposed  a  provisional 
anti-dumping  duty  on  imports  of  fluorspar  originating  in  the 
People's Republic of China. 

(2) council  Regulation  (EC)  N*  3529/932)  extended  this  duty  for  a 
period  of  two  months.  This  provisional  duty  is  therefore  due  to 
expire on 7 March  1994. 

(3) The Chinese exporters requested and were granted a hearing and made 
their views known in writing, as did other interested parties. 

(4) Following  publication  of  the  provisional  duty,  in  view  of  the 
difficulties  encountered  by  some  Customs  Authorities  in  the 
interpretation  of  the  description  of  the product  concerned  by  the 
proceeding, the Commission has amended Regulation  (EEC) N*  2463/93 
by commission Regulation  (EC) N*  3421/933) in order to clarify  the 
description  of  the  product  which  subsequently  is  defined  as 
follows : 

"fluorspar presented in filter cake form or in powder form, falling 
within CN Code ex 2529 21 00 (Taric Code 2529 21 00 10) and CN Code 
2529  22  00  (Taric  Code  2529  22  00  10) originating  in the  People's 
Republic of China". 

(5) With  regard  to  the  comparison  between  normal  value  and  export 
price,  the  Commission  made  the  comparison  for  its  provisional 
findings  on  an  ex works  basis  for  the  normal  value  and  on  a  FOB 
Chinese  harbour  basis  for  the  export  price.  After  due 
consideration  of  the  arguments  raised  by  the  parties,  the 
Commission proposes, for the purpose of definitive duty Regulation, 
to make the above comparison on an ex-FOB basis. 

(6) As  far  as  other  points  in the provisional  measures  are  concerned, 
particularly with regard to injury and causality, various arguments 
were  put  forward  by  the  Chinese  exporters  as  to  why  definitive 
measures  should not be imposed. 

These  arguments  are discussed  in detail in the  attached  regulation 
and  the  Commission  has  proposed  that  definitive  anti-dumping 
measures should be imposed. 

(7) This  measure  has  the  form  of  an  anti-dumping  duty  equal  to  the 
difference between a minimum price of ECU 113.50 per tonne  (dry net 
weight)  and  the  net  free  at  Community  frontier  price  before 
customers clearance. 

1) O.J. N#  L 226, 7.9.1993, p. 3 
2) O.J. N* L 321, 23.12.1993, p. 1 
3) O.J. N#  L 312, 15.12.1993, p. 5 

- A C 3 L-

C O m C H.  KEGOUkTIOH  (EC)  M4 

of 

imposing definitive anti-dumping duties on imports of fluorspar 

originating in the People's Republic of China and 

collecting definitively the provisional 

anti-dumping duty 

THE COUNCIL OF THE EUROPEAN  UNION 

Having regard to the Treaty establishing the European Cnanmrmity, 

Having regard to Council Regulation  (EEC) N* 2423/88 of 11 July  1988 on 

protection  against  dumped  or  subsidised  imports  from  countries  not 

members  of  the  European  Economic  Community(*)  and  in  particular 

Article  12 thereof. 

Having  regard  to  the  proposal  submitted  by  the  Commission  after 

consultation within the Advisory Committee as provided for by the above 

•» 

Regulation, 

Whereas: 

(1) O.J. »• I» 205, 2.8.1988, p. 1 

- 2 -

A. Provisional measures 

(1)  By  Regulation  (EEC) N*  2463/93(2)  as  amended  by  Regulation  (EC) 

N*  3421/93<3),  the  Commission  imposed  a  provisional  anti-dumping 

duty  on  imports  of  fluorspar,  in  filter  cake  or  powder  form, 

falling within  CN  Code  ex  2529  21  00  (Taric  code  2529  21  00  10) 

and CN Code ex 2529  22 00  (Taric code 2529 22 00 10), originating 

in the People's Republic of China. 

The  Council  by  Regulation  (EC)  N"  3529/93<4)  extended  the 

validity of this duty for a period not exceeding two months. 

B. Subsequent procedure 

(2)  Subsequent to the imposition of the provisional anti-dumping duty, 

the  interested  parties  who  so  requested,  were  granted  an 

opportunity  to  be  heard  by  the  commission.  Certain  of  these 

parties also presented written submission making known their views 

on the findings. 

(3)  Upon request, the parties were informed of the essential facts and 

considerations  on the basis of which it was intended  to recommend 

the  imposition  of  definitive  anti-dumping  measures  and  the 

definitive  collection  of  amounts  secured  by  way  of  provisional 

duty. 

They  were  also  granted  a  period  within  which  to  make 

representations  subsequent to the disclosure. 

(2) O.J. N* L 226, 7.9.1993, p. 3 

(3) O.J. N#  L 312, 15.12.1993, p. 5 

(4) O.J. N* L 321, 23.12.1993, p. 1 

- 3 -

(4)  The parties' comments were considered and the Commission modified 

its conclusions where it was deemed to be justified. 

( 5 )  Because  of  the  complexity  of  the  data  examined  and  of  the 

difficulties  faced  in  selecting  the  reference  country,  the 

investigation  could  not  be  concluded  within  the  time  limit 

provided  for  in  Article  7(9)(a)  of  Regulation  (EEC) N*  2423/88, 

hereafter referred to as the Basic Regulation. 

c. Product under investigation and like product 

(6)  Subsequent  to  the  publication  of  Regulation  (EEC)  N*  2463/93 

(hereinafter referred  to as the Provisional Duty Regulation), the 

definition  of  the  product  was  amended  by  Regulation  (EC)  N* 

3421/93. 

No  comments  were  received  by  the  commission  in  respect  of  this 

amendment  and  therefore  this  product  definition  is  confirmed  by 

the Council for definitive determination. 

(7)  As  regards  the  definition  of  like  product  within  the  meaning  of 

Article  2(12)  of  the  Basic  Regulation,  the  Commission  has 

established  in  recitals  10  and  14  of  the  Provisional  Duty 

Regulation, that fluorspar originating in China, in South Africa -

selected  as  a reference  country  -  and  in the European  Community, 

has the same chemical and physical characteristics, the same final 

application  and  is fully  interchangeable, irrespective  of  origin. 

In  the  absence  of  new  arguments  submitted  by  the  parties,  the 

Council  confirms  the  conclusions  of  the Commission  as  set  out  in 

recital 10 and  11 of the Provisional Duty Regulation. 

- 4 -

D. Dumping 

1. Normal value 

(8)  In the Provisional  Duty Regulation, the Commission  concluded  that 

South  Africa  was  an  appropriate  reference  country  for  the 

determination  of  the  normal  value  of  Chinese  imports  into  the 

Community. 

Therefore,  normal  value  was  established  in  accordance  with 

Article 2(5)(a)(i)  of  the  Basic  Regulation  on  the  basis  of  the 

prices  of  fluorspar  sold  by  a  South  African  producer  on  its 

domestic  market,  for  the  reasons  explained  in  recitals  14 and  15 

of the Provisional Duty Regulation. 

As  the  parties  concerned  by  the  proceeding  have  raised  no 

objection to this choice and to the method of the determination of 

the  normal  value,  the  Council  confirms  the  Commission's  findings 

as  set  out  in  recitals  14  and  15  of  the  Provisional  Duty 

Regulation. 

(9)  In  the  provisional  findings,  recital  13, the  Commission  had  also 

considered  that,  in  view  of  the  fact  that  the  South  African 

producer  has a more difficult  access to raw materials,  a downward 

adjustment of the selling prices in South Africa was necessary  for 

the  establishment  of  the  normal  value  in  a  reasonable  and 

appropriate  manner,  in  accordance  with Article  2(5) of  the  Basic 

Regulation. 

- 5 -

(10) The  complainants  claimed  that  the  above-mentioned  adjustment  is 

not in line with the Basic Regulation  for the following  legal and 

technical reasons: 

(1) 

The  downward  adjustment  implies  the  fact  that  the 

Commission  has  taken  costs  related  to  the  non-market 

economy  country  into  consideration,  which  in  accordance 

with  Article  2(5)  of  the  Basic  Regulation  should  be 

avoided; 

(ii)  The  Commission  has  taken  into  account  only  a  selective 

choice  of  natural  advantages  and  has  not  taken  into 

consideration 

many 

other 

natural 

advantages 

and 

disadvantages,  in  addition  to  easier  access  to  raw 

materials. 

The  Commission  cannot  accept  these  arguments.  Indeed,  the 

consideration  of  natural  advantages,  as  described  in  the 

Provisional  Duty  Regulation,  does  not  infer  taking  into  account 

any  costs  in  the  non-market  economy  country.  The  downward 

adjustment  is  restricted  to  eliminating,  in  the  determination  of 

the  normal  value  in  the  reference  country,  certain  steps  of  the 

production  process,  which  are  necessary  in  South  Africa  and  are 

not necessary  in the People's Republic  of China.  The  consequence 

of this elimination being that the relevant costs, as  established 

in  the  reference  country,  should  not  be  included  in  the 

determination of the normal value. 

- 6 -

In this respect, the Commission  believes that  the purpose  of  this 

adjustment,  based  on  the  natural  advantage  in  the  exporting 

country, is that of establishing the normal value in the reference 

country  in  an  appropriate  and  not  unreasonable  manner,  in 

accordance with Article 2(5) of the Basic Regulation. 

(11) As  to  the  technical  arguments  submitted  by  the  complainants  in 

this respect, the Commission considers that these elements are not 

related  to  the  natural  advantages  enjoyed  by  the  Chinese 

production,  in 

addition, 

all 

the 

other 

advantages 

or 

disadvantages  referred  to  by  the  complainants  have  only  been 

supported  by  allegations without  any  evidence  being  supplied.  In 

contrast  to  the  above,  it  should  be  stressed  that  the  adjustment 

made  to  the  normal  value  was  supported  by  data  provided  by  the 

South  African  producer  in  the  course  of  the  verification  visit 

showing  that  certain  steps of  the  production  process  carried  out 

in South Africa are not necessary in China due to easier access to 

the main raw material as a result of a higher fluorspar content in 

the mined material. 

(12) The Commission considers that the arguments submitted  are not duly 

substantiated  and therefore confirms the determinations  set out in 

the Provisional Duty Regulation. 

The Council confirms the above conclusions of the Commission. 

- 7 -

2. Export price 

(13) Due to the  insufficient cooperation  of the Chinese  producers, and 

as  set  out  in  recitals  16  to  18  of  the  Provisional  Duty 

Regulation,  the  export  price  was  determined  on  the  best 

information  available,  in  accordance  with Article  7(7) (b) of  the 

Basic Regulation.  In the specific circumstances, this information 

was  considered  to  be  the  data  contained  in  Eurostat  for  Chinese 

exports  under  CN  Code  ex  2529  22  00, which  shows  an  average  CIF 

price at the Community frontier of ECU 82.5 per tonne. 

As the parties  have not contested  this determination,  the council 

confirms this conclusion. 

3. Comparison 

(14) For purposes  of provisional determination, normal value on an ex-

works basis was compared with a FOB Chinese port export price. 

(15) The  complainants  have  objected  to  this  methodology  on  the  basis 

that  this comparison  is not at the same commercial  stage  and that 

as a consequence  the transport  costs which  are necessary  in South 

Africa to convey the product from the factory to the port have not 

been taken into account. 

-  8 -

The exporters  insisted on a comparison made on a FOB level for the 

export price  in the non-market  economy country  and on  an ex-works 

basis  for the  normal value  in the reference country,  arguing  that 

in  case  of  a  non-market  economy  country,  the  premises  of  the 

exporters correspond to the borders of the country. 

The Commission,  on considering  all the arguments  brought  forward, 

accepts  that,  for  purposes  of  comparison,  the  normal  value  and 

export price  should normally be compared on an ex-factory  level so 

that  both  can  be  compared  at  the  same  stage.  In  the  case  of  a 

non-market  economy  country,  Article  2(5) of  the  Basic  Regulation 

precludes  the  investigation  of  the  transport  costs  within  the 

country.  Because  of this, the determination  of a normal value  at 

an ex-factory  level is not possible unless the transport costs are 

calculated  on  the basis of the reference  country.  This requires, 

however,  knowledge  of  the  actual  location  of  the  production 

centres in the non-market economy country and in the case of there 

being  several  producers  at  different  locations,  the  actual 

production of each one of them. 

In this specific case and in view of the fact that the cooperating 

exporters  represent  only  21%  of  the  totality  of  the  Chinese 

fluorspar  imports  into the Community  in the  investigation  period, 

the  Commission  has  not  sufficient  information  concerning  the 

actual  distance  of all the production centres to the ports.  This 

lack  of  cooperation  makes  it  impossible  to  evaluate  the  actual 

location  of  the  production  centres  which  export  to  the  European 

Community. 

- 9 -

In the circumstances, the Commission, in view of the fact that the 

comparison cannot be made at an ex-works stage, considers that the 

first equivalent  stage at which reliable  information  is  available 

is the  FOB  level.  Because  of  this, the Commission  considers  the 

comparison  at  the  FOB  level  to  be  the  more  reasonable  and 

appropriate. 

The Council confirms these conclusions. 

(16) As  to  the  other  adjustments  made  by  the  Commission,  no 

observations  have  been  brought  forward  by  the  parties.  The 

conclusions  of  the  Commission  are  therefore  confirmed  by  the 

Council. 

4. Dumping margin 

(17) As s  result  of  the modification  to the  export price  calculation, 

the  definitive  dumping  margin,  expressed  as  a  percentage  of  the 

CIF  value,  is  equal  to  37.8%.  The  Council  confirms  the  above 

conclusions  as  well  as  all  the  other  conclusions  set  out  in 

recitals 21 and 22 of the Provisional Duty Regulation. 

E. injury 

(18) In  its preliminary  findings,  (recital  23 of  the  Provisional  Duty 

Regulation),  the  Commission  assessed  injury  on  data  referring  to 

the  free  market  and  concluded  that  the  Community  fluorspar 

industry  had  suffered  material  injury  because  of  the  effects  of 

the dumped  imports from the country  concerned. 

-  10 -

(19) The  exporters  have  argued  that  the  injury  was  not  caused  to  a 

Community  industry within the meaning of Article 4(5) of the Basic 

Regulation  and  that  the  complainants  do  not  qualify  as  such 

Community  industry. 

In  respect  of  this  argument,  the  Commission  has  established  that 

the  cooperating  producers  accounted  for  approximately  90% of  the 

total EC production of fluorspar  (see recital 3 of the Provisional 

Duty Regulation),  and therefore complied with the  requirements  of 

Article  4(5) to be qualified as the community  industry. 

As  established  in  recital  23  of  the  Provisional  Duty  Regulation, 

the  Commission  considered  that,  because  of  the  particular 

characteristics  of  the  fluorspar  market  in  the  Community,  the 

assessment of injury could be restricted to the free market.  This 

separation  only  concerns  the  assessment  of  injury  and  does  not 

infer  a  reduction  of  the  size  of  the  Community  industry  for 

purposes of its qualification under Article 4(5). 

(20) Furthermore,  the  exporters  contested  the separation  of  the market 

into  two  different  segments,  which  they  considered  wholly 

unwarranted  and  disputed  that  it  was  in  agreement  with  the 

criteria indicated by the jurisprudence of the court of Justice of 

the European community. 

In  this  respect,  however,  no  substantiated  arguments  were  made 

concerning the non-respect of these criteria and, accordingly, the 

Commission confirms its findings as indicated in recital 23 of the 

Provisional Duty Regulation. 

- 11 -

(21) The Council confirms the conclusions of the Commission  concerning 

the  market  to  be  assessed  and  all  data  concerning  the 

determination of injury. 

F. Causal link between injury and dumped Imports 

(22) In recital  40 of  the  Provisional  Duty  Regulation,  the  Commission 

concluded  that  the  dumped  imports  originating  in  the  People's 

Republic  of  China, because  of  their  increasingly  strong  presence 

on the Community  market,  their  low prices  and  the  resultant  lack 

of profitability of the Community  industry, caused material injury 

to the European community industry. 

The exporters contested the causal link between the dumped  imports 

from  China  and  the  material  injury  suffered  by  the  community 

industry, as established by the Commission. 

The Commission  has replied to these arguments and has received  no 

further comments  from the exporters. 

Therefore, the Council confirms the conclusions of  the  Commission 

as set out in recital 35 to 39 of the Provisional Duty Regulation. 

G. Pi—unity Interest 

(23) The  Commission  has  received  no  observations  from  the  interested 

parties  concerning  its  provisional  findings.  Therefore,  the 

considerations  on  the Community  interest,  as  set  out  in  recitals 

41 to 44 of the Provisional Duty Regulation,  are to be  considered 

final. 

-  12 -

The Council confirms these conclusions. 

H. Definitive duty 

(24) In  order  to  determine  whether  a  lower  dumping  duty  should  be 

imposed,  the  commission  compared  the  weighted  average  selling 

price  of  Chinese  fluorspar  (on  a  Community  frontier  customs 

cleared  basis)  with  the  corresponding  average  price  of  fluorspar 

produced  and  sold  during  the  same  period  by  the  Community 

industry,  since  this  difference  was  higher  than  the  dumping 

margin established,  it is the latter which should be  imposed. 

As a result of the modification  in the dumping margin, the minimum 

price  referred  to  under  recital  45  of  the  Provisional  Duty 

Regulation  should  be  113.5  ECUs  per  tonne.  All  the  other 

conclusions  of  recital  45  are  confirmed  for  the  purpose  of 

definitive determinations. 

The Council confirms the conclusions of the Commission. 

.# 

I. Collection of provisional duties 

(25) in view  of  the  dumping  margin  established  and  the  seriousness  of 

the injury caused to the Community  industry, the Council considers 

it  necessary  that  amounts  secured  by  way  of  provisional  anti 

dumping duties should be definitively  collected, 

HAS ADOPTED THIS REGULATION: 

-  13 -

Article 1 

1.  A  definitive  anti-dumping  duty  is  hereby  imposed  on  imports  of 

fluorspar in powder or filter cake form, falling within CM Code ex 

2529  21  00  (Taric  code  2529  21  00  10) and  CM  Code  ex  2529  22  00 

(Taric  code  2529  22  00  10), originating  in the  People's  Republic 

of China. 

2.  The duty  shall be equal to the difference between a minimum  price 

of  113.50  ECU  per  tonne  (dry  net  weight)  and  the  net  free  at 

Community  frontier price before customs clearance. 

3.  The provisions in force concerning customs duties shall apply. 

Article 2 

The amounts  secured by way of provisional  anti-dumping duty imposed  by 

Regulation  (EEC) M* 2463/93 shall be definitively collected. 

•# 

Article 3 

This Regulation shall enter into force on the day following that of its 

publication in the Official Journal of the European Communities. 

The Regulation shall be binding in its entirety and directly applicable 

in all Member States. 

Done at Brussels, 

For the council 

-»H-

BSN 0254-1475 

COM(94) 27 final 

DOCUMENTS 

EN 

1102 

Catalogue number : CB-CO-94-034-EN-C 

ISBN 92-77-64822-8 

Office for Official Publications of the European Communities 
L-2985 Luxembourg