Proposal for a COUNCIL REGULATION (EC) imposing a definitive anti-dumping duty on imports of powdered activated carbon originating in the People' s Republic of China and collecting definitively the provisional duty imposed
Date: 1996-01-15
Institutions: European Commission
Subjects: China, anti-dumping duty, coal, import, originating product

COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels,  15.01.1996 
COM(96)  5 final 

Proposal  for a 

COUNCIL REGULATION  (EC) 

imposing a definitive  anti-dumping duty on imports of powdered activated carbon 

originating  in the People's Republic of China and collecting definitively  the 

provisional  duty imposed 

(presented by the  Commission) 

1 

EXPLANATORY  MEMORANDUM 

(1) 

(2) 

(3) 

(4) 

(5) 

By  Commission  Regulation  (EC)  No  1984/95!  a  provisional  anti-dumping  duty 
was imposed on imports of powdered  activated carbon  ("PAC")  originating in the 
People's  Republic  of  China.  The  rate  of  the  provisional  anti-dumping  duty  was 
66.8%  of  the  net  free-at-Community  frontier  price before  duty  and  was  based  on 
the injury  elimination level  found. 

By  Regulation  (EC)  No  2736/952, the  Council  extended  the  validity  of  this  duty 
for a period of two months. 

Following publication  of the provisional  measures, new arguments concerning the 
dumping  calculations  were  presented  by certain  interested  parties.  This  led  to  a 
reduction of the dumping margin established from  71.5% to 69.9%. 

Various  arguments  were  also  put  forward  by  interested  parties  concerning,  inter 
alia,  the  comparability  of  the  Chinese  product  with  PAC  produced  in  the 
Community  (i.e.  "like product")  and causation  between  the injury  suffered  by the 
Community  producers  and Chinese imports. 

Certain  of  these  new  arguments  led  the  Commission  to revise  the  calculations  of 
the undercutting  and  the  injury  elimination  level.  These  revisions  led  to  a lower 
average  undercutting  margin  of  21.0%  (from  23.5%)  and  a  lower 
injury 
elimination  level of 38.6% (from 66.8%). 

1  O.J. No L  192,  15.8.1995, p.14 
2  O.J. No L 285, 29.11.1995, p.2 

(6) 

(7) 

(8) 

As  concerns  Community  interest,  at the  request  of  certain  importers/distributors 
various users were contacted following publication of the provisional measures in 
order to  ascertain  trends  in their consumption  of  PAC and also  to find  out how 
Chinese PAC is perceived in the market. 

None of the new information obtained or arguments presented alter, however, the 
main findings  set out in the provisional  duty Regulation, which are confirmed  in 
the enclosed definitive duty Regulation proposal. 

Given  that  the  revised  injury  elimination  level  is  still  lower  than  the  revised 
dumping  margin established,  the rate of  the definitive  anti-dumping  duty  should 
be  based  on  the  injury  elimination  level  of  38.6%.  Furthermore,  the  amounts 
secured  by  way  of  provisional  anti-dumping  duty  under  Regulation  (EC)  No 
1984/95 should be collected at the duty rate to be definitively  imposed.  Amounts 
secured in excess of the definitive rate of duty should be released. 

(9) 

A proposal is therefore submitted to the Council for the imposition of a definitive 
anti-dumping  duty  of  38.6%  on  imports  of  PAC  originating  in  the  People's 
Republic of China. 

1V> 

COUNCIL REGULATION (EC) 

imposing a definitive anti-dumping duty on imports of powdered activated carbon 

originating in the People's Republic of China and collecting definitively the 

provisional duty imposed 

THE COUNCIL OF THE EUROPEAN UNION, 

Having regard to the Treaty establishing the European Community, 

Having  regard  to  Council  Regulation  (EC)  No  3283/94  of  22  December  1994  on 
protection  against  dumped  imports  from  countries  not  members  of  the  European 
Community1, as last amended by Regulation (EC) No 1251/952, and in particular Article 
23 thereof, 

Having regard  to Council  Regulation  (EEC) No 2423/88 of  11 July  1988 on protection 
against  dumped  or  subsidised  imports  from  countries  not  members  of  the  European 
Economic  Community3,  as  last  amended  by  Regulation  (EC)  No  522/944,  and  in 
particular Article  12 thereof, 

Having  regard  to  the  proposal  submitted  by  the  Commission  after  consulting  the 
Advisory Committee, 

Whereas: 

1  OJNoL349,  31.12.1994, p. 1. 
2  OJ No L  122, 2.6.1995, p. 1. 
3  OJ No L 209, 2.8.1988, p. 1. 
4  OJ No L 66,  10.3.1994, p. 10. 

2 

A.  PROVISIONAL MEASURES 

(1)  The Commission,  by Regulation  (EC) No  1984/955, hereinafter  referred  to as 'the 
provisional  duty Regulation', imposed a provisional  anti-dumping duty on imports 
into  the  Community  of  powdered  activated  carbon  (hereinafter  referred  to  as 
"PAC") originating in the People's Republic of China and falling  within  CN code 
ex 3802 10 00. 

By Regulation (EC) No 2736/956, the Council extended the validity of this duty for 
a period of two months. 

(2)  Subsequent  to the  imposition  of  the  provisional  anti-dumping  duty,  one  Chinese 
exporter, 
the  complainants  and  other  interested  parties  presented  written 
submissions,  making  known  their  views  on  the  provisional  findings.  Where 
In  particular,  nine 
requested,  hearings  were  granted  by  the  Commission. 
importers/distributors  who  are  members  of  the  Community  of  Activated  Carbon 
Importing  Companies  in  Europe  (hereinafter  referred  to  as  "CACIC")  presented 
joint submissions concerning the Commission's findings. 

5  O J N oL  192, 15.8.1995, p. 14. 
6  OJ No L 285, 29.11.1995, p.2 

(3) 

In  addition,  following  the  imposition  of  the  provisional  anti-dumping  duty,  a 

company  based  in  the  USA  submitted  to the  Commission  that  it  started  exporting 

PAC  produced  in  a joint  venture  in  People's  Republic  of  China  on  a private  label 

basis  to  the  Community  during  1994  (i.e.  after  the  investigation  period)  and 

requested  to be exempted from  any definitive  duty.  The company  was advised  that 

such  an  exemption  could  only  be  granted  after  a  newcomer  review  investigation 

had  been  requested  and  carried  out  under  the  provisions  of  Article  11(4)  of 

Regulation  (EC)  No  3283/94.  Furthermore,  as  this  proceeding  relates  to  exports 

from  a non-market  economy  country,  the company  was  advised  that  it  would  also 

have to show to the satisfaction  of the Community  Institutions  that, in its particular 

case, individual  treatment  should be granted.  Nevertheless, certain  comments  of  a 

general  nature  which  the  company  made  had  also  been  raised  by  other  interested 

parties and were therefore  already taken into account, where appropriate. 

(4)  As  mentioned  in  recital  76  of  the  provisional  duty  Regulation,  at  that  stage  of  the 

investigation,  no  public  utility  user  or  industrial  user  of  PAC  had  made  any 

submissions  to  the  Commission.  Subsequent  to  the  imposition  of  the  provisional 

anti-dumping measures, however, several such users made their views known to the 

Commission. 

4 

In  addition,  certain  importers/distributors  submitted  that  the  Commission  should 

approach  "major"  PAC  users  in  order  to  obtain  information  on  the  evolution  of 

their consumption during the last few years and also to find out how they perceived 

Chinese  PAC  in  comparison  to  the  Community  produced  product.  As  the 

Commission  could  agree  to  this  request,  simple  questionnaires  were  sent  to 

numerous  PAC  users  situated  in  the  Community. 

In  total,  twenty-two  users 

situated  in  six  different  Member  States  were  approached  by  the  Commission. 

Meaningful  comments  or  replies  to  the  questionnaire  were  only  received  from 

twelve  of  these  users,  representing  approximately  6%  of  total  Community 

consumption.  Details  of  the  additional  information  collected  are  given  below  in 

recitals 62 to 66 of the present Regulation. 

(5)  The Commission continued to seek and verify  all other information it deemed to be 

necessary  for  its  definitive  findings  and  also  reviewed  certain  aspects  of  the 

calculations  made  in  the  provisional  duty  Regulation  to  establish  dumping, 

undercutting  and the  injury elimination  level.  The parties  were informed  of  these 

revised calculations  and also  of  the essential  facts  and considerations  on the basis 

of which it was intended to recommend the imposition of a definitive  anti-dumping 

duty  and the definitive  collection  of  the  amounts  secured by way  of  a provisional 

duty.  They  were  also  granted  a  period  within  which  to  make  representations 

subsequent  to  the  disclosure.  Their  representations  were  considered  and,  where 

appropriate, the Commission's findings were modified to take account of them. 

5 

B.  PROCEDURAL QUESTIONS  RAISED 

(6)  As  concerns  the  actual  initiation  of  this  investigation,  CACIC  argued  that  the 

complaint  lodged  by the European  Chemical  Industry  Council  (hereinafter  referred 

to  as  "CEFIC")  was  "factually  incomplete",  contained  "false  allegations"  and 

omitted  "a number  of  relevant  facts  which  would  have prevented  the  Commission 

from  initiating  this  investigation".  In  support  of  these  arguments,  CACIC  stated 

that  the complainants  had  omitted  the names  and  addresses  of  importers  known  to 

them in several Member States and, as a consequence, these importers  were unable 

to  participate  in  the  investigation.  CACIC  also  argued  that  the  Commission  was 

made  aware  of  many  wrong  addresses  and  mistakes  in  the  complaint  but  did  not 

take sufficient  measures to investigate the situation  in all Member States. 

CACIC  also  claimed  that  the  Commission  had  rejected  the  co-operation  of  an 

importer/distributor  in Sweden  and, because of this, the provisional  duty Regulation 

did  not  address  the  situation  in  all  Community  markets.  In  consequence,  CACIC 

considered  that  the  provisional  duty  Regulation  not  only  infringed  the  rights  of 

importers in the new Member States but was also defective  in its market analysis. 

6 
(7)  As concerns the remark made by CACIC concerning the importers omitted from the 
complaint, it has to be pointed out that when the Commission was made aware of 
the existence of these companies early in the proceeding, questionnaires requesting 
information were immediately sent to them.  The Commission is not in a position at 
the  initiation  stage  of  an  investigation  to  know  all  the  importers  or  exporters 
concerned  by the proceeding, as it  initially  relies  on information  provided  in the 
complaint. 
In  this  particular  case,  the  Commission  was  satisfied  that  the 
complainant  had  furnished  all  the  relevant  information  it  had  in  its  possession. 
Furthermore,  it  should  be  remembered  that  one  of  the  purposes  of  a  notice  of 
initiation  of  an  anti-dumping  proceeding  published  in  the  Official  Journal  of  the 
European  Communities  is  to  invite  all  interested  parties  to  come  forward  and 
participate in such a proceeding. 

With  regard  to  CACIC's  point  concerning  the  incorrect  addresses  of  certain 
interested parties in the complaint, it should be noted that the Commission sent out 
questionnaires  for  a second  time  to  these  companies  when  it  was  advised  of  the 
errors by one of the known importers. 

Concerning the allegation that the co-operation of one Swedish importer/distributor 
had been  rejected  by the Commission, it should be pointed  out that this company 
made  itself  known  in February  1995 and was informed  that  due to the  advanced 
stage of the investigation it was not possible for it to complete a questionnaire.  The 
company in question was advised, however, that its comments were most welcome, 
particularly  as far  as Community  interest  was concerned.  Subsequent  to this, the 
company  only  contacted  the  Commission  again  after  provisional  duties  were 
imposed  and actually  declared  that it had not made any imports of PAC from  the 
People's Republic of China during the investigation period. 

7 

(8) 

In view of the foregoing, it is considered that the rights of defence of all interested 
parties were respected.  As concerns the claim that the Commission's investigation 
did not address all markets and that its analysis is therefore defective, this question 
is dealt with below in recital 67 of the present Regulation. 

C. PRODUCT UNDER CONSIDERATION AND LIKE PRODUCT 

(9)  Certain parties reiterated arguments they had made previously in that Chinese PAC 
should not be considered as a like product to PAC produced in the Community (or 
to PAC produced  in the United  States of  America, the analogue country).  These 
parties submitted that in view of the many different  grade's of PAC on the market 
and  their  different  production  methods,  the  different  raw  materials  used  and  the 
diverse  technical  characteristics  imparted  to the finished  product,  it was  an over 
simplification  on the part of the Commission to treat them all as one like product. 

8 
(10)  One importer/distributor  repeated  its argument  that the Chinese PAC grade "GA" 
(which was chemically  activated using zinc) is extremely efficient  for waste water 
treatment, particularly in comparison to Community-produced  PAC normally used 
for  this purpose.  The company  therefore  submitted  again  that this Chinese PAC 
grade  should  not  be  considered  as  a  like  product  to  the  Community-produced 
grades.  In this respect, a major user stated that the Chinese PAC grade it had been 
purchasing for waste water treatment from the importer/distributor  in question was, 
in  economic  terms,  preferable  to  certain  Community-produced  grades.  In  other 
words, the Chinese PAC grade was of a better quality and at a competitive price in 
comparison to some Community-produced grades.  This does not, of course, mean 
there are no better quality  Community-produced  grades - it simply means that the 
Community-produced  grades of a similar quality are more expensive and therefore 
not normally used for waste water treatment. 

The same importer/distributor further  argued that this "GA" grade is also not a like 
product as it has a lower purity in comparison  to the PAC activated chemically in 
the  Community  by  phosphoric  acid.  It  was claimed,  therefore,  that  it cannot be 
used in many applications where Community-produced PAC is used. 

(11)  In  respect  of  the  above  observations,  it  should  be  noted  that  the  investigation 
revealed that the "GA" grade was sold in the Community to many different  types of 
users to which the Community producers are also selling their PAC grades (e.g. the 
food  industry, the chemical  industry  as well as for  water treatment).  In  addition, 
the sole co-operating Chinese exporter itself declared that its "GA" grade is suitable 
for  many  uses  including  the  chemical, pharmaceutical  and  food  industries.  This 
was  also  confirmed  during 
investigation  by  certain 
the  course  of 
importers/distributors. 

the 

(12)  Another  distributor  claimed  that  the  Chinese  PAC  grade  "GA"  is  a  very  efficient 

grade  when  used  in  wine  production  and,  as  there  is  no  zinc-activated  PAC 

produced  in  the Community,  it  should  not be considered  as a like product.  In this 

respect, it should be pointed out that whilst there may be no Community  production 

of  chemically  activated  PAC  using  zinc  (see  recitals  11  to  17  of  the  provisional 

duty  Regulation),  the  investigation  showed  that  there  are  equivalent  Community-

produced  grades  which  have  been  activated  by  means  of  phosphoric  acid  and 

developed  specifically  for  the  wine  industry.  This  was  indirectly  admitted  by  the 

distributor  itself  when  it  claimed  that  a high  anti-dumping  duty  on  Chinese  PAC 

would force  it to pull out of the Community  market thus leaving only  the two main 

Community producers to compete for this particular PAC sales sector. 

(13)  It  was  also  submitted  that  it  was  inappropriate  to  compare  chemically  activated 

PAC  produced  in  the  USA  to  that  produced  in  the  People's  Republic  of  China  as 

these countries used  different  chemical  activation  agents for  their PAC  production. 

In this respect, it is considered that although the activating agents are not always the 

same, the production  method  used  is similar  (see recital  13 of the provisional  duty 

Regulation).  In addition,  the raw  materials  used  in  the USA  are  identical  to  those 

used  in  the  People's  Republic  of  China.  This  leads  to  end  products  which  are 

sufficiently  alike for them to be comparable. 

10 
(14)  From the above, it is concluded that whilst there can be certain differences  between 
PAC grades imported from  the People's Republic of China and those produced in 
the  Community  and  the  USA,  as  already  explained  in  recitals  18 and  19 of  the 
provisional duty Regulation, the finished  products nevertheless remain  sufficiently, 
similar in terms of their physical characteristics for them all to be considered as like 
products  within  the  meaning  of  Article  2(12)  of  Regulation  (EEC)  No 2423/88. 
Indeed,  all  of  the  arguments  presented  in  the  previous  recitals  of  the  present 
Regulation  refer  only to potential differences  in quality  and, furthermore,  none of 
the interested  parties has provided evidence that imported Chinese  PAC is not in 
direct  competition  with  PAC  produced  in  the  Community  and  the  USA. 
Accordingly,  the  provisions  of  recitals  17,  20  and  21  of  the  provisional  duty 
Regulation are confirmed. 

D.  COMMUNITY INDUSTRY 

(15)  No new arguments were received  in connection  with recital 22 of the provisional 

duty Regulation, therefore these findings are confirmed. 

11 

E.  DUMPING 

1.  Normal Value - choice of analogue country 

(16)  Certain  interested  parties  questioned  the  suitability  of  the  USA  as  the  analogue 

country  in  this  particular  case.  It  was  argued  that  the  large  modern  plants  in  the 

USA  could  not  be  compared  to  the  smaller,  traditional  production  plants  in  the 

People's  Republic  of  China  and  that  differences  in  the  cost  of  investment  and 

depreciation in the USA rendered any such comparison as  "absurd". 

(17)  The argument put forward  completely overlooks, however, the fact  that the People's 

Republic  of  China  does  not  have  a market  economy  and  that  various  aspects  of  a 

producer's  input  and  output  are  directly  controlled  by  the  State.  This  intervention 
impedes  the  establishment  of  reliable  domestic  prices  and  costs  and  it  is  for  this 

reason  that  an  analogue  country  is  sought  for  the  purposes  of  establishing  normal 

value. 

In  all  cases,  the  Commission  will  use  the  most  appropriate  analogue 

country,  given  the  circumstances  of  the  case  and,  if  necessary,  make  due 

adjustments. 

In  this  particular  case,  for  the  reasons  stated  in  recital  25  of  the 

provisional duty Regulation, the choice of the USA as the analogue country  was not 

considered unreasonable. 

12 

(18)  In connection also with the choice of an analogue country, these parties also made 
the assumption that the unidentified co-operating parties in the USA were related to 
Community producers and that this was not conducive to objective results.  Despite 
being requested to do so, the Commission is not in a position to reveal the names of 
the co-operating US producers as their average domestic sales prices (and technical 
specifications of the grades taken for normal value comparison purposes) have been 
disclosed to the importers and the co-operating Chinese exporter.  To divulge their 
names  as  well  would  constitute  a  breach  of  confidentiality. 
It  should  also  be 
remembered  that  these  producers  were  visited  by  the  Commission  and  the  data 
provided was the subject of an on-spot verification.  In addition, the domestic sales 
which formed  the basis for the normal value calculations were at profitable  levels, 
only to unrelated customers and were representative of US domestic market prices. 
Therefore,  the  question  of  whether  or  not  these  US  producers  were  related  to 
Community producers is totally irrelevant. 

(19)  Another  interested  party  questioned  why  Malaysia  had  not  been  taken  as  the 
analogue country  instead of the USA since the average Malaysian  export price to 
the Community, as indicated in Eurostat during the investigation period (1 January 
to 31 December  1993), was lower than the average Chinese export price during the 
same period.  This party also proposed that the average Malaysian export price to 
the Community (obtained from Eurostat) be used for establishing normal value for 
Chinese  steam  activated  PAC.  It  also  submitted  that  since  Malaysia  does  not 
produce  chemically  activated  PAC,  a  theoretical  export  price  for  Malaysian 
chemically  activated  PAC  should  be used  to  establish  normal  value  for  Chinese 
chemically activated PAC. 

13 
(20)  This proposal for establishing normal value in Malaysia on the basis of an average 
export price obtained from Eurostat for many different  unknown grades (not all of 
which may be PAC), contradicts the request of all the other interested  parties that 
all comparisons  for  dumping and injury  purposes  should  be made on the basis  of. 
data referring  to comparable individual PAC grades for each of the two activation 
methods separately.  Accordingly, this proposal could not be accepted. 

(21)  Another reason for not selecting Malaysia as the analogue country in this particular 
case is  given  in  recital  25 of  the  provisional  duty  Regulation.  Whilst  the  major 
Malaysian producer of PAC known to the Commission  had been approached, this 
company  did  not  in fact  respond  to the Commission's  request  for  information.  It 
should  also be noted  that  available  information  indicates  Malaysia  produces only 
steam activated PAC whilst, like the People's Republic of China, the USA produces 
and sells on its domestic market both steam and chemically activated PAC grades. 

(22)  Accordingly, the conclusions set out in recital 26 of the provisional duty Regulation 

concerning the choice of the analogue country are confirmed. 

14 

2.  Normal value 

(23)  For the purpose of definitive findings, normal value was established on the basis of 

the methods used in recitals 27 and 28 of the provisional duty Regulation. 

3.  Export price 

(24)  A  duly  substantiated  request  was  received  from  the  sole  co-operating  Chinese 
exporter  concerning  the  incorrect  attribution  of  a  commission  to  certain  export 
transactions  which was made in the export price calculation.  An adjustment  was 
made accordingly. 

(25)  No other arguments were received in connection with the findings  in recitals 29 to 
32 of the provisional duty Regulations.  Therefore, these findings are confirmed. 

4.  Comparison 

(26)  The  Commission  provided  to  all  interested  parties,  upon  request,  additional 
technical specifications  as well as basic uses for certain US PAC grades which had 
been used for product comparison purposes. 

(27)  Certain  parties  argued  that  the  comparisons  made  between  the  Chinese  export 
prices  and  the  normal  values  were  based  on  inadmissible  simplifications  They 
reiterated a previous submission made that independent laboratory  analyses should 
be carried  out  in  order  to  allow  what  they  considered  to  be  a  "fair  comparison" 
between  Chinese  and  US  PAC  grades  for  the  dumping  calculations  as  well  as 
between  Chinese  and  Community-produced  grades  for  the  undercutting  and 
underselling  calculations  (see  recitals  35,  46  and  47  of  the  provisional  duty 
Regulation). 

15 

(28)  It  should  be  noted  that  the  importer/distributor  which  first  proposed  the  use  of 

independent  laboratory  analyses, had itself made comparisons between  Chinese and 

Community-produced  PAC  grades  in  its  submissions  to  the  Commission  during 

1994 and even  indicated  a US PAC  grade which  it considered  to be comparable  to 

the Chinese.  Indeed, the Commission  used certain  of these comparisons  where the 

products  appear  to  have  similar  commercial  specifications  and  basic  uses.  It  was 

only  in  January  1995  that  this  company  came  with  the  proposal  for  independent 

laboratory  analyses. 

In  this  respect,  it  should  be  recalled  that  the  investigation  showed  that  different 

PAC grades, irrespective  of their origin, are interchangeable  to a great extent  as  far 

as their basic applications  are concerned.  Indeed, as explained  in recitals  14 and  15 

of  the  provisional  duty  Regulation,  different  PAC  grades  sold  for  the  same 

applications  may  have  certain  differences  as  far  as  their  precise  technical 

specifications  are concerned  and  it  is  for  the  user  to  select  the  most  cost  effective 

PAC grade  for  its particular  needs.  Such  differences  can  be found  in  the  available 

specifications  sheets  issued  by  the  producers  or  the  importers/distributors  for  the 

general information  of users or which accompany  sales invoices, purchase contracts 

etc.  The  Commission  has used  these  specifications  sheets, together  with  the  basic 

known  applications,  in  order  to  make  comparisons  between  prices  of  apparently 

similar  PAC  grades  thus  avoiding,  at  the  request  of  certain  interested  parties,  the 

use  of  overall  PAC  average  prices. 

It  was  therefore  considered  that  detailed 

laboratory  analyses  would  not  assist  further 

this  particular  aspect  of 

the 

investigation. 

16 

(29)  The same company requested a meeting with the complainants and "possibly with a 

neutral  authority"  in  order to  discuss  product comparisons.  As  the  possibility  of 

such a meeting is provided for in Article 7(6) of Regulation (EEC) No 2423/88, the 

Commission  approached  the  complainants  with  this  request.  CEFIC  stated,, 

however, that such a meeting was not necessary in their view since they considered 

all  relevant  information  and  technical  expertise  at  their  disposal  to  make 

meaningful  comparisons had already been provided to the Commission.  Therefore, 

no such meeting was held between the parties directly concerned. 

(30)  Although  all  interested  parties  and in  particular  the  importers/distributors  (which 

have  also  sufficient  expert  knowledge  on  Chinese,  Community  and  even  US-

produced  PAC)  were  asked  to  propose  substantiated  specific  alternative 

comparisons or even adjustments for differences  in physical characteristics between 

the  different  PAC  grades,  only  a  limited  amount  of  relevant  information  was 

supplied.  This  information  did, however,  cast  doubt upon  the  appropriateness  of 

the  comparison  the  Commission  had made  for  one  Chinese  steam  activated  PAC 

grade  and,  accordingly,  the  Commission  changed  the  comparison  made  for  this 

particular Chinese grade. 

(31)  It  is  therefore  confirmed  that  the  grade-by-grade  comparisons  made  by  the 

Commission  on  the  basis  of  available  commercial  technical  specifications  and 

known uses should be maintained. 

17 

(32)  It was also submitted that the prices taken in the US market in order to calculate the 

dumping margin  were not at the same level of trade and that adjustments  should be 

made  accordingly. 

In  particular,  it  was  argued  that  an  importer/distributor  of 

Chinese PAC in the Community does not perform the same function  as a distributor 

of  US  origin  product  in  the  USA  and  that  costs  such  as  re-packing,  storage, 

financing,  technical  services/development  and  quality  assurance  are  all  elements 

which  are built  into the domestic  sales prices  of the US producers, but  not  into  the 

Chinese  export  price.  The  parties  which  raised  this  particular  issue  did  not, 

however, propose specific  levels for such  adjustments. 

(33)  As  a  general  remark,  it  should  be  noted  that  the  Commission  established  normal 

value on the basis of US distributor-delivered  domestic prices (i.e. at the same level 
of  trade  with  the Chinese exports  to importers/distributors  in the  Community).  As 

provided  for  in Article 2(10) of Regulation  (EEC) No 2423/88, only  adjustments  to 

take account of differences  affecting  price comparability  (e.g. selling expenses)  can 

be  made. 

In  this  respect,  as  is  indicated  in  recital  34  of  the  provisional  duty 

Regulation,  the  Commission  adjusted 

the  US  domestic  prices  used  in  the 

comparisons  so  as  to  take  account  of  all  discounts,  rebates,  commissions  and 

packing costs. 

18 

(34)  Concerning  re-packing,  the  investigation  showed  that  Chinese  PAC  is  always 

packed  in  bags  which  are  shipped  to  the  Community  in  cargo  containers.  Certain 

Community  importers/distributors  claimed,  however,  that  these  bags  are  not  of  an 

acceptable  quality  to  their  customers  and  re-bagging  before  resale  is  therefore 

necessary.  In this  respect,  it  should  be  noted  that  as  mentioned  in  the  provisional 

duty  Regulation,  the  Commission  had  already  adjusted  the  US  domestic  price 

downwards  to  take  account  of  all  packing  costs  incurred  by  the  US  producers, 

therefore  no further  adjustment  or allowance can be granted. 

(35)  The  argument  that  there  are  no  storage  costs  built  into  the  Chinese  export  prices 

whilst  such  costs  are  included  in  the  US  prices  is  not  considered  to  be  realistic. 

Indeed,  it  is  considered  inevitable  that  the  Chinese  export  prices  also  contain  a 

certain element for storage costs as the product would have to be stored until it is of 
an  economically  viable  quantity  for  export  shipment  and/or  fulfill  the  delivery 

timing  clauses  of  the  sales  contracts.  No  differences  can  therefore  be  established 

for  the  storage  costs  which  are  considered  to  be  included  in  both  the  US  and 

Chinese prices. 

19 

(36)  With  regard  to financing  costs  built  into  US domestic  prices  and  not  into  Chinese 

export prices, it should be remembered  that under free  market economy  conditions, 

regardless  of  their  functions  as  importers,  distributors,  producers,  traders,  etc.,  all 

such  companies  incur  these type of  expenses.  This  would  also be the  case  for  the 

Chinese  exporters  and  producers  if  they  too  had  to  operate  under  free  market 

conditions.  As  this  is  not  the  case,  this  argument  is  considered  irrelevant  for  the 

purposes  of  this  proceeding.  As  far  as the  payment  terms  granted  by  the  Chinese 

exporters  for  exports  to the  Community  and  by the  co-operating  US  producers  for 

their  domestic  sales,  these  were  found  to  be  similar.  No  adjustment  for  this 

purpose is therefore  necessary. 

(37)  Concerning  the  question  of  technical  services/development  and  quality  assurance 

costs,  the  investigation  showed  that  although  the  Chinese  exporters  guarantee  the 

quality  of  the  delivered  product  in  their  sales  contracts  and  should  therefore  incur 

quality  assurance  costs,  they  do  not  provide  technical  assistance  or  product 

development for their customers.  As PAC is a customer (i.e. user) oriented  product 

and  very  often  producers  develop  specific  qualities  for  the  needs  of  certain 

customers,  it  was  found  that  these  types  of  expenditure  constitute  a  part  of  the 

selling  costs  incurred  by  the  US  producers,  although  recorded  in  their  accounts 

under  "research  and  development"  costs.  Accordingly,  an  adjustment  was  made to 

the  domestic  sales  prices  of  each  US  producer  in  order  to  net-back  these  actual 

technical assistance and product development costs incurred by each producer. 

20 

5.  Dumping margins 

(38)  In  the  light  of  the  conclusions  set  out  above  with  regard  to  the  determination  of 

normal  value  and export  price, and the comparison  between  the two, the  definitive 

examination  of  the facts  showed  the existence  of  dumping  in respect  of  imports of 

the product concerned originating in the People's Republic of China. 

(39)  Taking into account the change made concerning the alternative comparison  for one 

PAC grade, the correct attribution of certain commission  and an adjustment  granted 

to  normal  value  for  technical  assistance  and  product  development  costs,  the 

weighted  average  dumping  margin  expressed  as  a  percentage  of  the  free-at-

Community  frontier  price, customs duty unpaid, is 69.9%. 

F.  INJURY 

1.  Community  consumption 

(40)  One  party  argued  that  for  the  purposes  of  examining  trends  in  Community 

consumption,  the Commission  should  have considered  not only  the period  1990 to 

the  investigation  period  but  also  previous  years  as  well,  since  this  would  have 

demonstrated  a  decline  in  consumption  (instead  of  the  small  increase  of  3.3% 

which  was  observed  over  the  period  1990  to  1993).  It  is  alleged  that  if  such  an 

analysis  over  a longer  period  had  been  carried  out,  the  effects  of  the  closure  of  a 

large  PAC  production  plant  in  Germany  before  1990  would  have  given  different 

trends as regards Community  consumption. 

21 

(41)  It  is  common  practice  for  the  Community. institutions  to  examine  trends  in 

consumption,  import  volumes,  market  shares, prices,  etc.  over  a period  of  several 

years  (normally  four  years  including  the  investigation  period).  This  practice  was 

followed  in the present case as it was considered  appropriate for giving an  objective 

view  of  the  development  of  the  market  situation  for  all  parties  concerned. 

It 

should,  however,  be  noted  that  even  if  the  period  under  analysis  were  to  be 

extended  and  the  trend  in  consumption  were  to  change,  the  trends  relating  to  the 

Community  producers'  market  share  (i.e.  declining)  as  well  as  those  of  Chinese 

imports (i.e. increasing), would anyhow remain the same. 

(42)  Certain  importers/distributors  also claimed  that  significant  quantities  of  PAC  were 

shipped  to the Community  from  the  People's  Republic  of  China but  never  actually 

put into  "free  circulation"  (i.e. by being entered  to bonded  warehouse and then  sold 
on  to  third  countries  outside  the  Community).  It was  also  submitted  that  Chinese 

PAC  was  put  into  free  circulation  within  the  Community  but  then  re-exported  to 

third countries.  In order to clarify  this situation, the Commission  requested  specific 

data and documentation  from  the parties concerned.  These parties  failed,  however, 

to  provide  the  necessary  information  which  would  enable  the  Commission  to 

attribute  the  actual  year  of  import  to  these  re-exports  of  Chinese  PAC  and  thus 

allow  their claims that  lower quantities  of PAC had  actually  been  consumed  in  the 

Community than had been found  in the Commission's  investigation. 

22 

2.  Volume and market share of dumped imports 

(43)  Apart from  the arguments presented  in the previous recital  of  this Regulation, no 
new submissions  were made concerning the volume and market  share of  dumped 
imports.  Therefore,  the  findings  in  recitals  37  to  44  of  the  provisional  duty 
Regulation are confirmed. 

3.  Prices of the dumped imports and price undercutting 

(44)  As with the comparisons made by the Commission in order to establish dumping, it 
was again submitted by certain interested parties that comparisons for undercutting 
purposes  between  Community-produced  PAC  grades  and  PAC  grades  imported 
from  the People's Republic  of China should be made on the basis  of  independent 
laboratory analyses. 

It was also argued that the technical specifications  of the different  PAC grades used 
by the Commission for comparison purposes were incomplete. 

In recitals 46 and 47 of the provisional duty Regulation, as well as in recitals 27 to 
31 of the present Regulation, it has been explained why the comparisons made on 
the  basis  of  available  commercial,  technical  specifications  and  uses  of  the  PAC 
concerned  were considered  sufficient  for  the purposes  of  this  investigation.  The 
Commission  used  the  commercial,  technical  specifications 
issued  by  the 
Community  producers  themselves  as  well  as  the  Chinese  PAC  technical 
specifications normally accompanying the purchase contracts of the importers. 

23 

(45)  It should also be noted that although the Commission's comparisons  were disclosed 

to  all  interested  parties  well  before  the  imposition  of  provisional  measures,  no 

specific  alternative comparisons or even adjustments  for any differences  in physical 

characteristics  between  different  PAC  grades  were  proposed  by  any  interested 

party.  One  could  have  expected  that  the  importers/distributors,  which  in  certain 

cases  are  also  trading  in  Community-produced  PAC,  have  the  necessary  expertise 

to provide the above-mentioned  information,  if they cared to do so. 

(46)  It  was  claimed  that  the  market  price  of  Chinese  PAC  in  the  Community  is  at  the 

level  of  the  Community  producers  or,  in  some  cases,  even  higher.  Whilst  it  may 

well be the case that  some export transactions  for  Chinese PAC grades  are made at 

similar  or  even  higher  price  levels  to  certain  transactions  involving  some  of  the 

Community  producers' grades  (see recital 48 of the provisional  duty  Regulation), it 
should  not  be  forgotten  that  the  Community  producers'  prices,  overall,  were 

significantly  undercut by dumped Chinese import prices. 

24 

(47)  With regard to the actual level of undercutting found,  it should be recalled that on a 

grade-by-grade  basis,  the  Community  producers'  weighted  average  net  ex-works 

sales  prices  in  the  Community  to  users  were  compared  to  the  weighted  average 

import  prices  of  the  equivalent  Chinese  grades,  adjusted  to  duty-paid  net  "ex-

warehouse" levels. 

It was submitted, however, that in uplifting  Chinese import prices to make them ex-

warehouse  and  thus  at  a  comparable  level  of  trade  and  commercial  stage  to  the 

Community  producers  ex-works  sales  prices,  the  Commission  had  not  taken  into 

account  all  costs  incurred  by  the  Community  importers/distributors,  nor  an 

appropriate profit  margin.  This is incorrect  since, as indicated  during the course of 

the investigation to the co-operating parties, an adjustment  of 27% was added to the 

Chinese CIF import prices for this purpose. 

(48)  It  should  be  stressed  that  this  percentage  represents  the  weighted  average  of  all 

costs  claimed  by  the  co-operating  importers  (customs  duty  which  had  been  paid, 

transport,  warehousing,  re-packing,  financing,  depreciation,  etc.)  and  a  reasonable 

profit  margin  based  on  the  importers'/distributors'  Profit  &  Loss  Accounts. 

Nevertheless,  in  conformity  with  the  adjustment  granted  for  establishing  normal 

value  with  regard 

to 

technical  assistance  and  customer  specific  product 

development  costs, which  are assumed  not  to be  in  the Chinese  prices,  it has  been 

decided,  for  the  purpose  of  definitive  calculations  of  undercutting,  to  make  a 

downwards  adjustment  to  the  sales  prices  of  each  Community  producer  to  take 

account  of  such  selling  costs  incurred  by  that  producer  during  the  investigation 

period. 

(49)  On  this  basis,  revised  undercutting  margins  of  up  to  35%  have  been  calculated. 
The weighted average, however, of these revised undercutting margins is  21%. 

25 

4.  Situation of the Community industry 

(50)  As  no  new  arguments  were presented  concerning  production,  production  capacity, 
stocks,  sales  and  market  share,  profitability  and  employment  (recitals  51  to  59  of 
the provisional  duty Regulation), these findings  are  confirmed. 

5.  Conclusions concerning injury 

(51)  In  the  light  of  the  above  and  in  the  absence  of  any  other  substantiated  arguments, 

the conclusions  set out in recitals 60 and  61 of the provisional  duty  Regulation  that 

the  Community  industry  concerned  suffered  material  injury  within  the  meaning  of 

Article 4(1) of Regulation  (EEC) No 2423/88 are  confirmed. 

26 

G.  CAUSATION 

1.  General remarks 

(52)  A  number  of  interested  parties  reiterated  claims  made  previously  concerning 

causation  of  injury.  These  parties  claimed  that  the  Commission,  when  arriving  at 

its  provisional  findings  and  disclosing  the  essential  facts  and  considerations  upon 

which it had the intention  to propose definitive  measures, had not sufficiently  taken 

account  of  the  arguments  raised  by them.  As  shown  below,  this  contention  is  not 

correct since the points in question  were explicitly  addressed by the Commission  in 

recitals 62 to 71 of the provisional duty Regulation. 

(53)  The  importers  continued  to  argue  that  there  was  a  downturn  in  demand  in  the 

Community  for  PAC  between  1990  and  the  investigation  period  caused  by 

developments  in  technology  and  increasing  use  of  re-cyclable  activated  carbons. 

The  Commission  acknowledged  in  recital  70  of  the  provisional  duty  Regulation 

that  there  may  have  been  an  increasing  demand  for  these  alternative  products, 

however, this does not necessarily  mean that the demand for PAC has dropped.  As 

stated  in  recitals  42,  62  and  70  of  the  provisional  duty  Regulation,  demand  (i.e. 

Community  consumption)  actually  increased  by  3.3%  between  1990  and  the 

investigation  period.  However,  the  most  important  factor  to  be  considered  is  that 

sales  of  the  Community  producers  decreased  whilst  imports  (and  particularly 

dumped  imports from  China) rose  significantly. 

27 

(54)  It was  also  argued that the closure  of  a large German  PAC production  plant  before 

1990  (referred  to  in  recital  40  of  the  present  Regulation)  caused  an  increase  in 

Chinese  imports  since  the  marketing  partner  of  this  producer  claimed  that  it  was 

"obliged"  to  replace  the  Community-produced  product  with  Chinese  PAC,  even 

though  this  company  was  also  acting  as  a  distributor  of  PAC  produced  by  other 

Community  producers  as well  as an importer/distributor  of PAC from  several  third 

countries.  Whilst  it  is  accepted  that  this  marketing  partner  had  to  look  elsewhere 

for  its  PAC  purchases,  such  a justification  for  increased  imports  of  Chinese  PAC 

does  not,  however,  alter  the  fact  that  such  imports  were  made  at  dumped  prices 

which  significantly  undercut  the  Community  producers'  prices  and  thereby  caused 

material  injury. 

(55)  Referring  to recitals 45 and 56 of the provisional  duty Regulation,  one party  argued 

that Chinese PAC imports could not have caused  injury  to the Community  industry 

as  the  average  prices  of  such  imports  increased  by  10.6% between  1990  and  1993 

and,  moreover,  the  average  PAC  sales  prices  of  the  Community  producers  as  a 

whole  also  increased  during  the  same  period. 

In  this  respect,  it  should  also  be 

recalled  that  the  overall  increase  in  the  Community-producers'  prices  was  only 

1.4%  over this period  and that  in certain  cases, the prices  of  Community-produced 

PAC  even  decreased.  Taking  into  account  the  significant  price  undercutting  of 

21.0%  established  for  1993, the conclusion  must  therefore  be drawn  that  there  was 

even  higher  undercutting  in  1990  (when  Chinese  imports  started  to  penetrate  the 

Community  market)  and not that there is an  absence of causation  between  Chinese 

dumped  imports and the injury  suffered  by the Community  industry. 

28 

(56)  Arguments  were  put  forward  that  the  financial  difficulties  of  the  Community 

producers  were  caused  not  by  Chinese  imports  but,  instead,  mainly  by  significant 

increases in the cost of production  of the producers and, in the case of one of them, 

by particularly high raw material costs. 

Although  Community  producers  should  be  able  to  expect  to  sell  their  products  at 

prices  which cover all costs in a market  where fair  competition  is prevailing,  in the 

light  of  comments  made by several  interested  parties the Commission  re-examined 

the  overall  situation  concerning  the  evolution  of  the  cost  of  production  of  the  co 

operating  Community producers.  The conclusion  was drawn that in order to  reflect 

costs  normally  incurred,  certain  additional  raw  material  costs  of  an  exceptional 

nature incurred  during the investigation  period by one Community  producer  should 

not  be  taken  into  account  when  establishing  the  injury  elimination  level.  This 
approach  is  confirmed. 

29 

(57)  Certain  interested  parties  also  continued  to  argue  concerning  the  impact  on  the 

Community  market  of  apparently  low  priced  imports  of  PAC  from  Malaysia.  No 

new  arguments  of  substance  were,  however,  presented  by  these  parties  and  it  is 

considered  that  the  reasoning  given  in  recitals  67  and  68  of  the  provisional  duty 

Regulation  adequately answers the points already raised. 

(58)  As explained  in recital  68 of the provisional  duty  Regulation,  the Commission  had 

no  evidence  that  exports  from  Malaysia  were  at  dumped  price  levels  during  the 

investigation  period.  Whilst  certain  evidence  was  submitted  to  the  Commission 

concerning  allegedly  dumped  Malaysian  exports,  this  in  fact  referred  to  the  year 

1994  (one  year  after  the  investigation  period)  and,  therefore,  no  link  between  any 

possible  Malaysian  dumping  in  1994  and  injury  suffered  by  the  Community 

industry  during  the  investigation  period  could  be  established  on  the  basis  of  the 
evidence provided. 

30 
(59)  Certain  interested parties put  forward  a calculation  which  attempted  to  show that 
even if Community-produced  PAC equivalent to all the Chinese imports had been 
sold  instead  by  the  Community  producers  during  the  investigation  period,  these 
Community  producers  would  still  have made  significant  losses.  This  calculation 
overlooks, however, the fact  that the actual sales volumes and values achieved by 
the Community producers during that period were, in reality, influenced by the low 
priced dumped Chinese imports and for this reason could not form the basis of such 
a theoretical calculation.  Therefore, this calculation is considered to be flawed and 
cannot  demonstrate  the  hypothetical  financial  situation  of  the  Community 
producers if Chinese PAC imports were not present on the Community market. 

(60)  It was  also  alleged  by certain  parties  that  the Community  producers  were  selling 
PAC  outside  the  Community  at  much  lower  prices  than  in  the  Community  and, 
therefore,  the price  level  on  the  Community  market  was  not  the  only  reason  for 
their actual "economic" situation  As indicated in recital 69 of the provisional duty 
Regulation, the Commission found that the Community producers' sales outside the 
Community were made at profitable levels and therefore at much higher prices than 
the PAC sold inside the Community at a loss.  In fact, the weighted average selling 
price  of  all  grades  of  PAC  sold  outside  the  Community  by  the  co-operating 
Community producers increased from  1,792 ECU per tonne in  1990 to  1,839 ECU 
per tonne in the investigation  period.  The allegation,  as put forward,  is  therefore 
based  on  incorrect  assumptions.  Nevertheless,  the  impact  of  the  declining  sales 
volumes  of  Community  producers  outside  the  Community  is  acknowledged  in 
recitals 69 and 71 of the provisional duty Regulation. 

31 

2.  Conclusions concerning cause of injury 

(61)  In the  light  of  the  above and in the absence  of  any other meaningful,  substantiated 
arguments, the conclusions  set out  in recital  71 of the provisional  duty  Regulation 
are  confirmed. 

H.  COMMUNITY  INTEREST 

(62)  As mentioned in recital 4 of the present Regulation, twenty-two companies, most of 

them put forward  by certain importers/distributors  as "major"  users of PAC  situated 

in  six  different  Member  States,  were  approached  by  the  Commission  after  the 

imposition  of  provisional  measures.  Meaningful  comments  or  replies  to  a  simple 

questionnaire  were  received  from  only  twelve  users,  representing  approximately 

6% of total Community  consumption. 

(63)  As concerns  the PAC purchases of these twelve users, five  declared  that their PAC 

consumption  was  stable, four  declared  they  had  decreasing  consumption  and  three 

declared they had increasing  consumption. 

(64)  Of  the  users  which  replied  to  the  questionnaire  or  submitted  comments,  seven 

32 

indicated that Community  and Chinese PAC prices were comparable, but only two 

of them gave the trade names of the grades they had compared.  Examination of the 

specifications  of  the  Community-produced  grades  compared  by  these  two  users 

showed,  however,  that  the  Chinese  product  was  technically  superior  to  that 

produced in the Community and, therefore, not comparable for the purposes of this 

investigation.  Two  other  users  also  indicated  that  Chinese  PAC  is  much  less 

expensive  than the same quality of PAC produced in the Community.  Three users 

indicated that they had chosen Chinese PAC because of its quality in direct relation 

to its price.  On the other hand, another user  stated  it had chosen  the  Community 

product for exactly  the  same  reason.  Two  other users  had changed  from  Chinese 

PAC to that produced  in the Community.  In view  of  the conflicting  nature of the 

information received from the users, no decisive conclusion can be drawn from this 

data. 

(65)  Furthermore, despite being so requested, no substantiated comments  were made by 

the  users  concerning  the  impact  that  anti-dumping  measures  on  Chinese  PAC 

would have on their operating budgets.  Most of the users did, however,  argue that 

a  high  anti-dumping  duty  might  mean  Chinese  imports  being  excluded  from  the 

Community market, thus, perhaps, reducing the level of competition. 

33 

(66)  In this  respect,  it  should  be repeated  that  the purpose  of  trade  defence  measures  is 

to  eliminate  the  trade  distorting  effects  of  the  injurious  dumping  and  to  restore 

effective  competition.  Accordingly,  no  different  conclusions  other  than  those 

established  in  recitals  75  and  76  of  the  provisional  duty  Regulation  could  be 

reached. 

(67)  One  Swedish  importer/distributor  argued  that  the  imposition  of  anti-dumping 

measures  on  Chinese  PAC  would  have  a  profoundly  detrimental  effect  on  its 

business.  However,  this  company  declared  that  there  were  no  imports  of  Chinese 

PAC  into  its  Scandinavian  sales  territory  (Sweden,  Finland,  Denmark)  during  the 

investigation  period.  This  importer  also  argued  that  the  Commission  should  have 

taken  Sweden  and  Finland  into consideration  in  its  investigation  even  though  they 

were  not  Members  of  the  Community  during  the  investigation  period. 

In  this 

respect,  the  Commission  notes  that  the  total  PAC  consumption  in  Sweden  and 

Finland  is  estimated  to  be  approximately  700  tonnes  per  annum,  or  about  2%  of 

total  Community  consumption.  Given  also  that  there  were  no  imports  of  Chinese 

PAC  there  during  the  investigation  period,  it  is  considered  that  even  if  data  for 

these  two  new  Member  States  concerning  imports,  sales,  consumption  had  been 

included  in the findings, the impact would have been  insignificant. 

34 

(68)  In  the  light  of  the  above,  it  is  considered  that  the  conclusions  drawn  by  the 

Commission  in  the  provisional  duty  Regulation  concerning  Community  interest 

should  be  confirmed. 

Indeed,  no  compelling  reasons  have  come  to  light  which 

would  lead to the conclusion  that adopting  definitive  measures  would  not be in the 

interest of the Community. 

I.  UNDERTAKING 

(69)  An  undertaking  based  on  a combination  of  one  minimum  price  and  a  quantitative 

limit  for  exports  of  chemically  activated  PAC  was  proposed  by  the  sole  co 

operating  Chinese  exporter. 

It  was  suggested  by  this  exporter  that  the  Chinese 

authorities could  guarantee the monitoring  of the execution  of such  an undertaking, 

however,  the  Chinese  authorities  themselves  made  no  such  commitment.  This 

suggestion  did  not,  however,  contain  any  specific  price  or  quantity  level,  nor  refer 

to the company's steam activated PAC exports to the Community.  In this respect, it 

should  be  remembered  that  PAC  exists  in  many  different  grades  which  have 

different  prices.  Therefore,  an undertaking  with  one  average minimum  price  could 

not be accepted.  Furthermore, if an undertaking on a grade-by-grade basis had been 

offered, 

the  monitoring  of  such  an  undertaking  would  have  been  virtually 

impossible  as  the  exact  grades  this  company  will  export  to  the  Community  could 

not  be  controlled  against  official  statistics  (which  do  not  refer  to  import  data  on  a 

grade-by-grade basis). 

35 

(70)  It  should  also  be  noted  that  although  this  Chinese  exporter,  which  is  in  reality  a 

trading company, may be the largest exporter of Chinese PAC to the Community, it 

does  not  represent  the  totality  or even  the majority  of  Chinese  PAC  exports  to  the 

Community.  Given  that  there  are  several  other  exporters  and  that  the  Chinese 

authorities  themselves  have  not  indicated  their  willingness  to  guarantee  the 

execution  of  such  an  undertaking,  this  course  of  action  is  not  considered 

appropriate for this case. 

(71)  The  exporter  was  advised  accordingly  that  an  undertaking  could  not  be  accepted. 

This approach  is  confirmed. 

36 

J.  DUTY 

(72)  As concerns  the  detailed  calculations  used  to establish  the  injury  elimination  level 

in  the provisional  duty  Regulation,  the  actual  weighted  average  net  ex-works  sales 

prices  of  those  Community-produced  PAC  grades  considered  to  be  comparable  to 

the  imported  Chinese  grades  were uplifted  on  an  individual  basis  by  the  weighted 

average  loss  of  all  the  Community  producers  to  levels  which  yielded  a  reasonable 

profit  margin of 5%.  In this regard, CEFIC argued that the reasonable profit  margin 

to be added  on to the break-even  PAC  sales prices of the  Community  producers  in 

order  to  establish  the  injury  elimination  level  should  be  based  only  on  profitable 

sales  realised  by the  Community  producers  in  their  activated  carbon  activities  and 

not on an average profit  which  also includes loss-making  PAC  sales.  Furthermore, 

it was  submitted  that the 5% pre-tax  profit  is too low  to secure  a reasonable  return 
on investments particularly  as in  1990, before  major  market penetration  by  Chinese 

imports,  the  Community  producers  were  achieving  on  average  a  9.6%  profit  on 

their PAC sales in the Community. 

37 

(73)  In  this  respect,  it  should  be  made  clear  that  the  average  profit  margins  earned  by 

each  of  the  three  co-operating  Community  producers  on  their  total  turnover  of  all 

activities  relating  to  activated  carbon,  excluding  PAC  sold  in  the  Community  at  a 

loss,  ranged  from  4.1%  to  5.4%  during  the  investigation  period.  It  should  also  be 

noted that as only 70% of the lost PAC sales volumes of the Community  producers 

between  1990  and  the  investigation  period  have  been  taken  over  by  dumped 

Chinese  imports,  it  is  unreasonable  for  the  purposes  of  this  exercise  to  uplift  the 

break-even  prices  of  the  Community  producers  by  the  full  profit  margin  of  9.6% 

which they enjoyed  in 1990. 

(74)  In the light, however, of all the above comments made by interested  parties, certain 

aspects  of  the  methodology  used  for  the provisional  measures  have  been  reviewed 

and an alternative method is now considered to be the most appropriate  to calculate 

break-even  (i.e. full  cost  of  production)  and  reasonable  profit-yielding  price  levels 

for  the different  grades  of the Community  producers  which  were compared  to each 

Chinese grade. 

(75)  In this  respect, the full  cost of production  per  grade for  each  Community  producer, 

adjusted  where appropriate  (see recital  56 of the present Regulation), was taken  and 

to this  a 5% profit  was added.  In order to make correct comparisons,  a downwards 

adjustment  was  then  made  to  these  theoretical,  profit-yielding  prices  to  take 

account  of  technical  assistance  and  product  development  selling  costs  incurred 

during the investigation  period by each one of these producers  (see recital  48 of the 

present Regulation). 

38 

(76)  The  average  ex-warehouse  selling  price  (i.e.  CIF  import  price  plus  27%  for 

importers'/distributors'  mark-up)  for  each  imported  Chinese  grade  was  then 

compared to a single weighted average profit-yielding  Community  producers' price. 

This  single Community  producers' price for  each  Chinese  grade was calculated  for 

injury  elimination  purposes  using  the  individual  grade  prices  by  Community 

producer  as  established  in  the  previous  recital  (weighted  according  to  quantities 

sold by each Community producer). 

(77)  Any  difference 

resulting  from 

the  above-mentioned  comparison 

(weighted 

according  to the quantities  imported)  was the injury  elimination  amount.  The total 

injury  elimination  amount  was then  expressed  as a percentage  of  the  total  Chinese 

CIF import value. 

(78)  The  above  methodology  is  confirmed  and  the  revised  injury  elimination  amount, 

expressed  as a percentage of the import price, free-at-Community  frontier  is 38.6%. 

Given  that  this  revised  injury  elimination  level  is  still  lower  than  the  revised 

dumping  margin  established  (see  recital  39  of  the  present  Regulation),  definitive 

anti-dumping duties should be imposed as follows: 

People's Republic of China: 38.6%. 

K.  COLLECTION  OF PROVISIONAL  DUTIES 

39 

(79)  In view  of  the nature  and the  level  of the injury  caused  to the  Community  industry 
by the dumped  imports and since the Commission's provisional  findings  are, for  the 
most  part,  definitively  confirmed,  it  is  considered  necessary  that  the  amounts 
secured  by  way  of  the  provisional  anti-dumping  duty  should  be  definitively 
collected.  As the  provisional  duty  exceeds  the  duty  rate  definitively  imposed,  the 
amount collected should not exceed that of the definitive  anti-dumping  duty. 

HAS ADOPTED THIS  REGULATION: 

Article 1 

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

activated  carbon  falling  within  CN code ex 3802  10 00 (Taric additional  code  3802 

10 00*91) originating in the People's Republic of China. 

2. 

The  rate  of  the  definitive  anti-dumping  duty  shall  be  38.6%  of  the  net,  free-at-

Community  frontier  price, before  duty. 

3.  Unless  otherwise  specified,  the provisions  in force  concerning  customs  duties  shall 

apply to the said duty. 

40 

Article 2 

1. 

The  amounts  secured  by  way  of  the  provisional  anti-dumping  duty  pursuant  to 

Regulation  (EC)  No  1984/95  shall  be  definitively  collected  at  the  duty  rate 

definitively  imposed. 

2.  Amounts secured in excess of the definitive  rate of duty shall be released. 

Article 3 

This Regulation  shall  enter into force  on the day following  its publication  in  the Official 

Journal of the European  Communities. 

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

States. 

Done at Brussels, 

For the Council 

The President 

M 

ISSN 0254-1475 

COM(96) 5 final 

DOCUMENT 

EN 

02  u 

Catalogue number  :  CB-CO-96-008-EN-C 

ISBN 92-77-99468- i 

Office for Officiai Publications of the European Communities 

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