Proposal for a COUNCIL REGULATION (EC) amending Regulation (EEC) No 830/92 by repealing the anti-dumping duty on imports of certain polyester yarns originating in India
Date: 1994-11-16
Institutions: European Commission
Subjects: India, anti-dumping duty, economic survey, import, plastics, textile fibre

COMMISSION OF THE EUROPEAN COMMUNITIES 

COM(94) 454 final 
Brussels,  16.11.1994 

Proposal for a 
COUNCIL REGULATION  (EO 
amending Regulation (EEC) No 830/92 by repealing the anti-dumping 
duty on imports of certain polyester yams originating in India 

(presented by the Commission) 

EXPLANATORY MEMORANDUM 

1. 

2. 

3. 

4. 

5. 

6. 

7. 

By  Regulation  (EEC)  No  830/92(,),  a  definitive  anti-dumping  duty  was  imposed  on 
imports  of  certain  polyester  yams  originating  in  Taiwan,  Indonesia,  India,  the 
People's Republic of China and Turkey. 

In December  1992, the Commission  initiated  a review  of this Regulation in  respect of 
newcomer exporters in India who requested  such a review according to rcital 60 of the 
said Regulation. 

The Commission has limited the scope of the review to the changed circumstances with 
respect to dumping since no request for review of the original injury  findings was made 
and no indication was received that the circumstances of injury  had changed. 

Since the alleged  changed circumstances have put into question the continuing validity 
of the original findings regarding dumping and also the continuing representativity of the 
sample used to establish normal value and export prices, the Commission considered that 
a review of the dumping established for  all Indian producers was warranted. 

In view  of  the large number  of  exporters  concerned,  it  was considered  appropriate  to 
establish  normal  value  and  export  price  on  the  basis  of  a  sample  of  companies  in 
accordance with Article 2(13) of the basic Regulation. 

The facts finally  established  show that the dumping margins, i.e. the amounts by which 
normal  values,  as  established,  exceeds  the  price  for  export  to  the  Community,  are 
insignificant  or non-existent and should be regarded as de minimis. 

In  these  circumstances,  the  Commission  proposes  that  since  the  dumping  margins 
established  are  de minimis. Regulation (EEC) No  830/92  should be amended and the 
duties imposed on imports of the product concerned from India should be repealed. 

(i) 

OJN0L88,  3.4.1992, p. 1. 

Proposal  for a 
COUNCIL REGULATION  (EQ 
amending Regulation  (EEC) No  830/92 by  repealing the anti-dumping 
duty  on imports of  certain polyester yarns originating in India 

THE COUNCIL  OF THE EUROPEAN UNION, 

Having regard to the Treaty  establishing the European  Community, 

Having regard to Council  Regulation  (EEC) No 2423/88  of  11 July  1988  on protection against 
dumped or subsidized imports from countries not members of the European Community(1), as last 
amended by Regulation  (EC) No  522/94(2),  and in particular Article  14  thereof, 

Having  regard  to  the  proposal  submitted  by  the  Commission  after  consultation  within  the 
Advisory  Committee; 

Whereas: 

A. 

PREVIOUS  PROCEDURE 

(1) 

(2) 

By  Regulation  (EEC) No  830/92(3),  the Council  imposed a definitive  anti-dumping duty 
on  imports  of  certain  polyester  yarn falling  within  CN codes  5509  21  10,  5509  21  90, 
5509 22  10, 5509 22  90,  5509  51  00 and 5509  53  00 originating in Taiwan, Indonesia, 
India, the People's Republic  of  China and Turkey. 

In  recital  60  of  Regulation  (EEC)  No  830/92  the  Council  noted  that  the  Commission 
would  be  ready  to  initiate  without  delay  a  review  proceeding  for  the  exporters  who 
supplied  sufficient  evidence  to the Commission  that they had not exported the products 
concerned  to  the  Community  during  the  original  investigation  period  (1  January  to 
31 December 1989), that they only started such exports after the said period or had a  firm 
intention  of  doing  so  and that they  were  not  related  to,  or associated  with,  any  of  the 
companies  subject to the anti-dumping  duty (so-called newcomers). 

B. 

REVIEW 

(3) 

Thirty Indian companies made themselves known to the Commission, claiming that they 
had  not  exported  the  product  concerned  during  the  investigation  period  and  had  only 
commenced doing so after that period.  They  also claimed that they  were not related to 
any of the  companies involved  in the original  investigation  subject to the  anti-dumping 
duties and requested a newcomer review be opened. 

(i) 

(2) 

(3) 

OJNoL209,  2.81988,  p. 1. 
OJN0L66,  10.3.1994, p. 10 
OJN0L88,  3.4.1992, p. 1. 

(4) 

(5) 

(6) 

On request,  these  companies provided  evidence  of the facts  they  alleged.  The evidence 
provided by seventeen of the producers concerned has been considered sufficient to justify 
the  initiation  of  a  review  in  accordance  with  the  provisions  of  Articles  7  and  14  of 
Regulation (EEC) No 2423/88  (hereinafter referred to as "the basic Regulation") and the 
Commission,  after  consultation  of  the  Advisory  Committee,  initiated(4)  a  review  of 
Regulation  (EEC) No  830/92 with regard to these producers. 

The notice of initiation also made provision for  an extension  of the review to any other 
producer in India, where warranted. 

No  request  for  review  of  the  original  injury  findings  was  made  and no indication  was 
received that the circumstances of injury as originally  established have changed. 

(7) 

In the course of the investigation  it was found that: 

(i) 

there had been a substantial increase in imports into the Community of the product 
concerned, (from  3 000 tons in the original  investigation period to  11 000 tons in 
the year  1992), which  could  only  be attributed to those producers concerned by 
the original  investigation  or other unknown companies; 

(ii) 

export prices on average had decreased by  more than 25% since  1989; 

(iii) 

the Indian rupee over the same period had devalued by 70%; 

(iv) 

the Indian economy  had been progressively  liberalized leading to the removal  of 
numerous internal  barriers to trade, of taxes and of refund  schemes. 

(8) 

The  potential  impact  of  the  two  last  elements  on  the  price  of  the  like  product  on thé 
domestic  market  (increase  in  price  of  imported  raw  materials and  certain  reductions  in 
import  taxes)  and  the  general  development  of  the  export  price,  put  into  question  the 
continuing validity  of the original  findings regarding dumping, based on the situation in 
1989,  and the increased volume of  exports cast doubt on the continuing  representativity 
of the  sample used  at that time to establish  normal  value and export price. 

(9) 

In  these  circumstances,  the  Commission  considered  that  a  review  of  the  dumping 
established for all  Indian producers was warranted. 

C. 

PRESENT  PROCEDURE 

(10) 

In  view  of  the  large  number  of  exporters  concerned,  some  43  from  the  original 
investigation  and  17  newcomers,  it  was  considered  appropriate,  as  in  the  original 
investigation,  to  establish  normal  value  and  export  price  on  the  basis  of  a  sample  of 
companies in accordance with Article 2(13)  of the basic Regulation. 

(4) 

OJ No C 339, 22.12.1992,  p. 2. 

(11)  With  a view to ensuring that the results yielded by this sampling procedure would  not be 
significantly  different  from  that  which  would  have  resulted  from  an  investigation  of all 
Indian  producers,  the  selection  of  this  sample  was  based,  in  accordance  with  consistent 
practice,  on  the  criteria  of  volume  of  export  and  domestic  sales  of  the  like  product, 
product-type  mix  both  in  India  and  the  Community,  size  of  the  companies  and  their 
locations.  On  this basis,  5 producers were  selected  representing,  in  total,  approximately 
33%  of  the  exports  from  India  to the  Community  of the  product  concerned. 

(12)  As  in  the  original  investigation,  the  Synthetic  and  Rayon  Textile  Export  Promotion 
Council (SRTEPC), representing virtually all exporters in India of the product concerned, 
was  informed  of  the  companies  selected,  the  criteria  used  and  the  intention  of  the 
Commission to apply the weighted average result of the investigation of the sample to all 
the  Indian  companies  considered  in  the  proceeding.  Whilst  the  SRTEPC  raised  no 
objection to the sample or this methodology, three Indian producers maintained a request 
that individual  dumping calculations be carried out for them. 

(13)  As individual  consideration  of these three Indian producers was not unduly burdensome 
and did not delay the investigation,  the Commission  investigated these three  companies 
separately. 

(14)  The Commission  carried out on-the-spot  investigations  at the premises  of the  following 

companies: 

Sample companies: 

Indo Rama Synthetics (India) Ltd 
Rajasthan Textile Mills (prop.  Sutlej  Cotton Mills) 
The Eastern  Spinning Mills Industries Ltd 
Sree Valliappa Textiles Ltd 
Coats Viyella (India) Ltd 

Companies requesting individual  investigation: 

Vardhman  Spinning & General  Mills Ltd 
Soundararaja Mills Ltd 
Deepak  Spinners Ltd 

D. 

RESULT OF THE INVESTIGATION 

(1) 

Normal  value 

( 15)  Normal value was generally established on the basis of the comparable price actually paid 

or payable in the ordinary  course of trade for the like product in India. 

(16)  Where a particular product type exported to the Community was not sold on the domestic 
market or where such sales were in insufficient  quantities or were made at a loss, normal 
value  was  constructed  on  the  basis  of  the  cost  of  production  plus  a  reasonable  profit 
margin.  The  selling,  general  and  administrative  expenses  included  in  the  cost  of 
production and profit margins were calculated by reference to the expenses incurred and 
the profits realised by the exporter concerned on profitable sales of other types of the like 
product  sold in sufficient  quantities on the domestic market. 

(17) 

In one case it was not possible to follow  this approach to establish a margin of profit as 
one exporter was found to have had no sales of the like product on the domestic market 
during the  investigation  period.  In this  case,  the  profit  margin used  was the  weighted 
average  profit  realised  on  profitable  sales  of  other  types  of  the  like  product  on  the 
domestic market by  all the other exporters investigated. 

(2) 

Export price 

(18)  Export prices were determined on the basis of the prices actually paid or payable for the 

product concerned  sold for export to the Community. 

(3) 

Comparison 

(19)  The  normal  value  by  product  type  was  compared  with  the  export  prices  for  the 
corresponding type on a transaction-by-transaction basis at an ex-works level and for the 
same level  of trade.  For the purpose of a fair comparison normal value was adjusted in 
accordance with the provisions  of  Article 2(9)  and (10)  of the basic Regulation  to take 
account  of  differences  affecting  price comparability  and relating to import  charges and 
indirect taxes  and differences  in  selling  expenses arising  from  conditions  and terms  of 
sale.  Adjustments  claimed  for  the  above  differences  were  limited  to  those  for  which 
satisfactory  evidence was submitted that they had a direct relationship to the sales under 
consideration.  In particular,  allowance was granted under Article 2(10)(b) of the basic 
Regulation  in respect of import charges on raw materials physically  incorporated in the 
like product, when destined for consumption in India and not collected in respect of the 
product exported to the Community. 

(4) 

Dumping margins 

(20)  The examination of the facts showed that the dumping margins, i.e. the amounts by which 
normal  values,  as  established,  exceeded  the  prices  for  export  to  the  Community,  were 
insignificant  or non-existent and should therefore be regarded as de minimis. 

(21)  The weighted  average margins of  dumping for  each exporter expressed as a percentage 

of the CIF Community  frontier  price were  as follows: 

(i) 

Sample companies: 

Indo Rama  Synthetics  (India) Ltd 
Rajasthan Textile Mills (prop  Sutlej Cotton Mills) 
The Eastern  Spinning Mills Industries Ltd 
Sree Valliappa Textiles Ltd 
Coats Viyella  (India) Ltd 
Weighted average 

(ii) 

Companies requesting individual  investigation: 

Vardhman Spinning &  General Mills Ltd 
Soundararaja Mills Ltd 
Deepak  Spinners Ltd 

1.97% 
0.01% 
0.00% 
0.67% 
0.32% 
0.94% 

0.80% 
0.26% 
0.00% 

In view  of the fact that the dumping margins established were all below 2% they  should 
be regarded as de minimis. 

E. 

AMENDMENT OF THE REVIEWED  MEASURES 

(22) 

It  is  therefore  concluded  that,  as  the  dumping  margins  established  are  de  minimis. 
Regulation  (EEC) No  830/92  should be amended  and the duties imposed  on imports of 
the product concerned  from  India should cease to apply. 

(23)  The exporters in India and the complainant  have been informed  of these  findings. 

(24) 

Since the review is limited to Indian producers, it does not affect  the date on which the 
duties imposed on other countries by Regulation  (EEC) No  830/92  will  expire pursuant 
to Article  15(1) of the basic Regulation, 

HAS ADOPTED THIS REGULATION : 

Article  1 of Regulation  (EEC) No  830/92  is amended  as follows: 

Article 1 

1. 

2. 

In paragraph  1, the word  "India" is deleted. 

In paragraph 2, the line commencing "India" and the list of companies under the heading 
"INDIA" are deleted. 

Article 2 

This  Régulation  shall  enter  into  force  on  the  day  following  that  of  its  publication  in  the 
Official  Journal of the European Communities. 

This Regulation shall be binding in its entirety and directly applicable in all Member States. 

Done at Brussels, 

For the Council 
The President 

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