Proposal for a COUNCIL REGULATION (EC) imposing a definitive anti-dumping duty on imports of coumarin originating in the People' s Republic of China
Date: 1996-03-08
Institutions: European Commission
Subjects: China, anti-dumping duty, import, organic chemical, originating product

COMMISSION OF THE EUROPEAN  COMMUNITIES 

Brussels,  08.03.1996 
COM(96)  103 final 

Proposal  for  a 

COUNCIL  REGULATION  (EC) 

imposing a definitive anti-dumping duty on imports of coumarin originating in the 

People's Republic of China 

(presented  by  the  Commission) 

Explanatory  memorandum 

1. 

The Commission Regulation (EC) No. 2352/95 *) imposed a provisional anti 

dumping duty on imports of coumarin originating in the People's Republic of 

China. 

2. 

This provisional anti-dumping duty has been extended by a further period of two 
months by Council Regulation (EC) No. 212/96  2\ 

3. 

After examining the arguments put forward by the interested parties, the 

Commission has definitively established the facts. 

4. 

In accordance with Article 12 of Council Regulation (EC) No. 2423/883), the 
Commission, after consultation of the Advisory Committee, proposes to impose 

a definitive duty of the same amount of the provisional duty and to collect 

definitively the provisional anti-dumping duty. 

]) 
2> 
3> 

OJNoL239, 7.10.1995, p. 4. 
OJN0L28, 6.2.1996, p. 1. 
O J N o.  L 209,  2.8.1988,  p.  1. 

fa 

Proposal for a 

COUNCIL REGULATION (EC) No 

/.... 

of. 

imposing a definitive anti-dumping duty on imports of coumarin originating in the 

People's Republic of China 

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 
Community  1,  as  last  amended  by  Regulation  (EC)  No  1251/95  2and  in  particular 
Article 23 thereof, 

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 
Economic  Community  *,  as  last  amended  by  Regulation  (EC)  No  522/94  4,  and  in 
particular Article 12 thereof, 

Having  regard  to  the  proposal  submitted  by  the  Commission  after  consulting  the 

Advisory Committee, 

Whereas: 

OJ No L 349,31.12.1994, p. 1. 
OJNOL122, 2.6.1995, p. 1. 
OJ No L 209, 2.8.1988, p. 1. 
OJ No L 66,10.3.1994, p. 10. 

A. PROVISIONAL MEASURES 

(1)  The  Commission,  by  Regulation  (EC)  No  2352/95  5f  hereinafter  referred  to  as 
"the  provisional  duty  Regulation",  imposed  a  provisional  anti-dumping  duty  on 

imports into the Community  of coumarin falling within the CN code ex 2932 21 00 

and originating in the People's Republic of China. 
By Regulation (EC) No 212/96 6, the Council extended the validity of these duties 
for a period of two months expiring on 9 April 1996. 

B. SUBSEQUENT PROCEDURE 

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

interested parties submitted their comments in writing: 

-CEFIC on behalf of the Community industry 

-Tianjin  No  1  Perfumery  Factory,  an  exporter/producer  from  the  People's 

Republic of China, 

-British  Essential  Oil  Association  and  the  importers  united  therein  (BEOA),  on 

behalf of the major part of users and importers in the Community. 

-Vereinigung  der  am  Drogen-  und  Chemikalien-  Gross-  und  Aussenhandel 

beteiligten  Firmen (VDC), on  behalf  of  Paul  Kaders  GmbH, Hamburg, Germany, 

importer. 

(3)  The written comments submitted by the interested parties were considered by the 

Commission services and taken account of where appropriate. 

5 
6 

OJ No L 239, 7.10.1995, p. 4. 
OJNoL28, 6.2.1996, p. 1. 

C.  PRODUCT UNDER INVESTIGATION, LIKE PRODUCT AND COMMUNITY 

INDUSTRY 

(4)  VDC  has  reiterated  its  claim  that  Chinese  coumarin  and  coumarin  produced  by 

Rhône Poulenc-cannot be considered as like products. It claimed in particular that 

the  Chinese  product  and the  Community  product  were  produced  from  different 

raw materials, used different production processes, and that the Chinese product 

was  of  a  lower  quality  and  could  not  be  used  for  as  many  purposes  as  the 

Community product. 

However,  it  had  provisionally  been  established  that  the  two  products  appeared 

almost  entirely  interchangeable  and that  differences  in  quality  had  no  effect  on 

the  definition  of  the  "like  product".  This  matter  has  been  explicitly  dealt  with  in 

recitals  (11)  and  (12)  of  the  provisional  duty  Regulation.  Since  VDC  only 

reiterated the arguments  submitted  before the  imposition  of  the  provisional  duty 

and did not provide new evidence, the findings for the provisional  determinations 

are confirmed. 

(5)  As  no  new  arguments  have  been  presented  regarding  the  product  under 

investigation, the like product and the Community industry, the findings set out in 

recitals (9) to (13) of the provisional duty Regulation are confirmed. 

D 

DUMPING 

1. 

Normal value 

(6)  For the provisional determinations the normal value was established on the basis 

of  the  average  ex-factory  price  of  coumarin  sold  on  the  United  States  market 

which was selected as an analogue country. 

(7)  VDC argued that the Commission's  efforts to obtain information from  India could 

not  be  considered  sufficient  and  that  other  potential  sources  of  information 

should  have  been  tapped.  The  Council  would  point  out  that  all  four  Indian 

companies  known to be coumarin producers, were contacted by the Commission 

services.  However,  from  the  information  received  it was  found  that  only  one  of 

them actually produced coumarin during the investigation period. This one, at the 

request  of  the  Commission  services,  supplied  some  general 

information  about 

the  Indian  market,  but  refused  subsequently  to  fill  out  the  questionnaire. 

Furthermore, on the basis of the information available, the domestic  sales  prices 

of the  Indian producer  in question were substantially  higher than those of  Rhône 

Poulenc  Inc.,  as  a  result  of  very  high  tariff  protection  of  the  Indian  coumarin 

market.  It has been found that this would still be the case even  if  an  adjustment 

for duty draw-back were applied on the  raw materials  used for the  production  of 

coumarin. Therefore the choice of  India as analogue country would have led, on 

the  basis  of  the  information  available,  to  the  establishment  of  a  normal  value 

higher  than  that  found  by  using  the  United  States  of  America  as  analogue 

country.  Hence, the conclusions  of  recital (14) of the provisional duty  Regulation 

are confirmed. 

(8)  As regards the choice of the  United States of America  as analogue  country,  VDC 

reiterated  the  claim  that  the  United  States  was  unsuitable  as  analogue  country 

owing  to  the  monopoly  position  that  the  US  manufacturer  allegedly  enjoyed  in 

that  market,  allowing  him  to  dictate  the  prices;  as  evidence,  VDC  referred  to  a 

price increase imposed by the producer in question in November  1991. 

The  Council  would  point  out  that  the  US  producer  cannot  be  regarded  by  any 

means  as  being  in a  monopolistic  situation,  since,  as  explained  in recital  (15)  of 

the  provisional  Regulation,  during  the  investigation  period  China  held  a  very 

substantial share of that market. As far as the above  mentioned  price increase is 

concerned,  it  should  be  noted  that  it was  completely  nullified  by  the  middle  of 

1993  under  the  pressure  exerted  on  the  US  market  by  low  priced  imports  from 

the People's  Republic of China. 

(9) 

In objecting to the choice of  USA as analogue  country, VDC  has  reiterated that a 

reference  country  should  be  comparable  in  terms  of  production  conditions, 

methods and standards.  The  Council observes that the differences  in production 

process  between  Rhône  Poulenc  Inc.  and  the  Chinese  producers  have  already 

been  examined  at the  stage  of the  provisional  determinations.  In this  respect  no 

adjustment  appeared  then 

to  be  justified,  as  stated  in  recital  (15)  of  the 

provisional duty Regulation,  1st and 2nd paragraphs. 

As no new argument  has  been  put forward  in this respect, the  Council  maintains 

that  the  choice  of  USA  as  analogue  country  has  been  made  in  an  appropriate 

and  reasonable  way.  Therefore,  recital  (15)  of  the  provisional  duty  Regulation  is 

confirmed. 

(10)  Tianjin No 1 Perfumery  Factory argued that, following  innovations  brought about 

in  its  production  process,  its  plants  have  now  a  higher  yield  than  the  other 

companies  in China and than  Rhône Poulenc and therefore  its  production  costs 

would  be comparatively  lower.  It must be underlined that this  statement  has  not 

been substantiated at all. However, the Council points out that costs and prices in 

China  -  a  non-market  economy  -  do  not  result  from  the  free  action  of  market 

forces,  but  are  the  subject  of  State  intervention.  Since  Tianjin  No  1  Perfumery 

Factory  is  owned  by  the  State,  which,  as  a  consequence,  has  a  determining 

influence on its business, it is not possible to establish reliable costs and prices in 

order to assess the comparative  advantage that the  producer  in question  claims 

to  enjoy  in  respect  of  the  other  Chinese  producers  of  coumarin,  as  well  as  in 

respect of  Rhône Poulenc.  It follows  that the  establishment  of  individual  normal 

values  and  hence  individual  anti-dumping  duties  is  not  possible  in  the  present 

case. 

(11)  Consequently, the Council confirms, for the purpose of the definitive findings, the 

single  normal  value  for  all  Chinese  producers  established  on  the  basis  of 

domestic  sales  prices  found  in  a  market  economy  country,  i.e.  the  USA, 

according  to  the  rules  set  out  in  Article  2.(5)  of  Council  Regulation  (EEC) 

2423/88, as indicated in recitals (16) and (17) of the provisional duty Regulation. 

2. 

Export prices 

(12)  No  new  arguments  were  presented  in  relation  to  the  findings  set  out  in 

provisional duty  Regulation about the export prices determinations.  Recitals  (18) 

and (19) are therefore confirmed. 

3. 

Comparison 

(13)  BEOA  pointed  out that transport  costs  in the  United  States  of  America  have  not 

been  deducted  from  the  normal  value  for  the  purpose  of  the  comparison  of  the 

latter  with  the  export  prices,  as  provided  for  by  the  Article  2(10)  of  the  Basic 

Regulation. The  Council notes that for the purpose of ensuring a fair comparison, 

the normal value and the Chinese  export prices were  established at fob level,  US 

and Chinese  border respectively.  As regards the  adjustment  of  US normal value, 

requested  by  BEOA,  transport  costs  should  have  been  added  to  the  ex-factory 

level and not deducted, in order to establish a fob, US  border,  normal value level. 

However,  it  has  been  found  that  the  transport  cost  of  coumarin  between  the 

Rhône  Poulenc  Inc.  production  plants  and  the  closest  shipping  harbour  is  lower 

than  0,5%  of normal value.  Therefore  in conformity with Article 2.(10)(e)  of  Basic 

Regulation, this adjustment was  considered  insignificant  and  hence  disregarded. 

In  this  respect,  the  determinations  laid  in  recital  (21)  of  the  provisional  duty 

Regulation are confirmed. 

(14)  With  relation to the  allowance for  physical differences  in the form of  a  downward 

adjustment  of  normal value,  CEFIC argued that no real quality  difference  existed 

between the Chinese  coumarin and that of Rhône-Poulenc.  In CEFIC's view,  any 

difference  is  simply  a  matter  of  perception  on  the  part  of  certain  users  only, 

notably  those  using  coumarin  for  fine  fragrance  production,  who  are  of  the 

opinion that Rhône-Poulenc's coumarin is more suitable for their applications. 

The  Commission,  in  its  investigation,  has  found  that  tho  Chinese  product  did  not 

have a stable quality and needed to be submitted systematically to quality control 

tests  by  the  traders;  moreover,  in  certain  cases  the  shipped  batches  differed 

sufficiently  from  the  accepted  sample  to  make  them  unsuitable  for  the  use  for 

which  they  were  originally  bought.  Furthermore,  as  CEFIC  itself  admits  in  its 

submission,  most  fine  fragrance  makers  have  a clear  preference  for  the  Rhône 

Poulenc  product;  consequently  the  Chinese  coumarin  is  excluded  from  several 

applications  in  the  specific  field  of  fine  fragrances.  In  view  of  this  the  Council 

considers  that the supplementary  costs  for  quality  control  and  rejected  batches, 

as  well  as  the  slightly  more  limited  scope  of  application  of  Chinese  coumarin, 

justify an allowance for difference in quality. 

(15)  CEFIC contested also the methodology  used by the Commission for  establishing 

the allowance for quality differences as described in recital (22) of the  provisional 

duty  Regulation.  In  particular  CEFIC  alleged  that  the  sales  price  difference  in 

1988  between  Rhône-Poulenc  SA  coumarin  and  Chinese  coumarin  was  based 

on a sales price of Rhône-Poulenc SA yielding a profit margin on turnover  higher 

than  the  5%  used  by  the  Commission  services  to  calculate  the  underselling 

during 

the 

investigation  period. 

In  substance,  CEFIC  argued 

that 

the 

Commission's  approach  linked the  value  of  the  quality  difference  to the  level of 

profit achieved; hence CEFIC suggested to adjust Rhône-Poulenc SA sales price 

in  1988  by  applying  the  profit  margin  of  5%  used  for  establishing,  during  the 

investigation  period,  the 

injury  elimination 

level  through  the  underselling 

methodology 

The Council points out that there is no link between the calculation method of the 

quality  difference  as  perceived  by  the  consumer  and  the  determination  of  the 

profit  required  to  reach  the  injury  elimination  level. On the  one  hand, the  sales 

price difference  in 1988 appears to represent the quality difference  as  perceived 

by  the  operators  in  a  coumarin  Community  market  not  yet  depressed  by  the 

Chinese  low  price  policy,  at  a  time  when  Chinese  exporters  held  a  significant 

market share of 21.3%, reflecting the existence of a certain degree of competition 

on the market. On the other hand, users and other operators  purchase  coumarin 

at a price level which corresponds to their perception of the quality of the product, 

independently  from the production cost of the said product, which is unknown to 

them. 

(16)  As  no  further  arguments  were  submitted  concerning  the  comparison  between 

normal  value  and  export  price, the  Council  confirms  the  conclusions  set  out  in 

recitals (20) to (22) of the provisional duty Regulation. 

4.  Dumping margin 

(17)  The dumping margin, which was  higher than 50%, as indicated in recital  (23)  of 

provisional Regulation, is therefore confirmed. 

to 

E. INJURY 

(18)  It  was  provisionally  determined  that  the  prices  of  coumarin  originating  in  the 

People's  Republic  of  China  have  consistently  undercut  the  prices  of  the 

Community  product  since  1990.  During the  investigation  period  the  undercutting 

practised  by  the  Chinese  exporters  has  been  found  to  be  as  high  as  28 7%  on 

the  price  of  Community  industry  coumarin.  VDC  argued  that  falling  prices  of 

imports  of  coumarin  from  China  between  1990  and  the  investigation  period 

cannot  be considered as undercutting  the  Community  producer  prices within the 

meaning of Article 4(2)(b) of the basic Regulation, in so far as they simply passed 

on  to  the  consumer  the  effects  of  the  declining  prices  of  the  raw  materials,  in 

particular  orthocresol  which  is  used  only  by  Chinese  producers  for  producing 

coumarin. 

It  has  been  observed  that  Chinese  prices,  which  in  1988  and  1989  were 

practically  at the  same  level of  the  Community  product,  have  been  undercutting 

Rhône  Poulenc  SA.  prices  throughout  the  period  1990/1994,  regardless  of  the 

evolution  of  the  prices  of  the  raw  materials,  in  particular  orthocresol,  whose 

prices,  in  fact,  during  the  period  under  examination  (1990/1994),  though 

declining,  were  substantially  higher  than  in  the  years  prior  to  1990,  when  no 

undercutting  was  recorded.  Therefore,  it  is  maintained  that  significant  price 

undercutting  has  been  observed  between  1990  and  the  investigation  period 

within  the  meaning  of  Article  4(2)(b)  of  the  basic  Regulation.  The  findings  of 

recital (29) of the provisional duty Regulation are therefore confirmed. 

H 

(19)  No other argument concerning the injury suffered  by the Community  industry has 

been  submitted.  The  injury  findings  and  the  conclusion  that  the  Community 

producer  has  suffered  material  injury  within  the  meaning  of  Article  4  (1)  of  the 

basic  Regulation,  as  stated  in  recitals  (24)  to  (38)  of  the  provisional  duty 

Regulation, are therefore confirmed in view, in particular,  of the dramatic  erosion 

of  market  shares  and  of  the  heavy  financial  losses  suffered  by  the  Community 

industry during the period under examination. 

F. CAUSATION OF INJURY 

(20)  With  regard  to the  effect  of  dumped  imports,  VDC  maintained  that  no  clear  link 

existed  between  the  imports  from  China  and  any  injury  to  the  Community 

producer.  To  support  this  statement,  VDC  pointed  out  that  imports  from  China 

decreased  by  33  tonnes  between  1991  and  1992,  while  those  from  the  USA 

increased by the same volume during the same period. 

This  argument,  however,  is  unconvincing.  Indeed  VDC  omitted  to  consider  that 

the two  quoted developments  are  simply  episodic  and  limited fluctuations  which 

contrast  with  the  overall  growing  trend  of  imports  from  China  in  the  five  year 

reference  period and the mainly  stable imports from the  USA.  In absolute terms, 

the  increase  of  132  tonnes  in  imports  from  China  between  1990  and  the 

investigation period (1 April 1993 - 31 March 1994) at low undercutting prices has 

clearly  had  a  negative  impact  on the  Community  industry.  The  development  of 

imports from China has to be seen in the context of the Community market which 

amounts to a few hundred tons a year and in which the Community  industry  saw 

its  sales  decreasing  by  58.5%.  Consequently,  the  findings  of  recital  (39)  of  the 

provisional duty Regulation are confirmed. 

t2 

(21)  With  regard  to  the  effect  of  other  factors,  VDC  claimed  that  imports  from  third 

countries were a major factor in the Community industry's loss of market share.  In 

this  respect,  VDC  pointed  out  that  imports  from  third  countries  climbed  from  38 

tonnes in 1990 to 71 tonnes in the investigation period. 

It is observed that only imports from Russia and Japan, which were also  made  at 

low prices comparable to those of the imports from China, could have contributed 

to  the  injury  suffered  by  the  Community  industry.  However,  given  their  low 

volume, representing  less than 7%  of the Chinese  imports,  it must be  concluded 

that  the  sharp  decline  in  sales  and  market  share  of  the  Community  industry  is 

principally  attributable  to  the  massive  dumped 

imports  from  China  which 

increased  their  market  share  by  32  percentage  points  between  1990  and  the 

period  of  investigation,  compared  to  an  increase  of  1,8  percentage  points  from 

Russia  and  3,7  percentage  points  from  Japan  over  the  same  period. 

Consequently,  the  Council  maintains  that  a  possible  contribution  to the  injury  by 

low priced imports from other third countries can only be considered as marginal, 

given  their  much  smaller  volume  compared  to  that  of  the  Chinese.  The 

conclusions  of  recital  (43)  of  the  provisional  duty  Regulation  are  therefore 

confirmed. 

(22)  As  no  further  aspects  concerning  other  possible  injury  factors  have  been  found 

and  no  further  argumente  have  been  submitted,  it  is  maintained  that  the  low 

priced  imports  of  coumarin  from  the  PRC,  taken  in  isolation,  caused  material 

injury  to  the  Community 

industry  through  their  continuous  erosion  of  the 

Community  industry's  market  share  and the  depressing  effect  on  its  prices.  The 

provisional findings on the causation of injury as expressed  in recitals (40) to  (42) 

and (44) to (46) of the provisional duty Regulation are therefore confirmed. 

13 

G. COMMUNITY INTEREST 

1. 

Interest of the Community industry 

(23)  According to a submission by VDC, the extent to which an anti-dumping measure 

is in the Community  interest has to be judged in the light of the overall economic 

situation  of  the  Community  industry,  whose  consolidated  profit  has  increased 

considerably in the first half of 1995 compared to the same period of 1994. 

While  it  may  be  correct  that  the  overall  situation  of  Rhône  Poulenc  SA  has 

improved  after  the  investigation  period,  no  indication  has  been  given  that  the 

profitability  of  the  coumarin  business  by  Rhône  Poulenc  SA  has  improved. 

Moreover,  it  should  be  recalled  that,  following  a  longstanding  practice  of  the 

Community  institutions, all aspects of a given case are only examined  in relation 

to  the  product  in  question,  i.e.  in  this  case  coumarin.  For  these  reasons,  the 

argument of VDC cannot be accepted. 

(24)  VDC  further  argued  that  the  imposition  of  an  anti-dumping  duty  would  have 

repercussions on the Community's exports of orthocresol to China, as 80% of this 

raw  material for  Chinese  coumarin  originates  in the  Community.  This  statement 

has  not  been  substantiated;  however,  it  should  be  noted  that  any  increase  in 

Community orthocresol exports to China by Community producers of that product 

may  be  attributed  to  an  increase  of  Chinese  exports  of  coumarin  to  the 

Community as a result of unfair Chinese trading practices. In addition it has to be 

observed that any decrease of Community exports of orthocresol to China due to 

lower  coumarin  imports  from  China  would  be  compensated  by  a  higher 

production volume of phenol in the Community to feed the anticipated increase in 

production of coumarin by the Community industry. 

f4 

2. 

Interest  of  users 

(25)  Moreover,  VDC  and  some  users  raised  the  argument  that the  decline  in  imports 

of  coumarin  from  China  following  the  imposition  of  an  anti-dumping  duty  would 

cause  difficulties  to  users  of  Chinese  coumarin  which  will  have  to  bear 

considerable  costs  in  changing  their  formulas  as  a  result  of  switching  from 

Chinese  coumarin to that made by the Community  industry; in addition,  importers 

would  allegedly  encounter  problems  in  satisfying  customer  demand  for  Chinese 

quality coumarin. 

The  Council  notes  that  neither  VDC  nor  the  users  have  given  any  information 

about the incidence of these costs for changing formulas  on the  production  costs 

of  perfume  compounds;  in  any  case  it  must  be  stressed  that  Chinese  coumarin 

would  still  be  available  on  the  Community  market  if  an  anti-dumping  duty  was 

imposed, but at a  non-injunously dumped  price. Therefore  'switching' costs would 

not necessarily  have to be incurred. 

(26)  VDC  expressed  the  concern  that,  in  the  long  run  the  imposition  of  a  definitive 

anti-dumping  duty  would  place  in  a  monopolistic  position  the  sole  producer  of 

coumarin  in  the  Community,  a  producer  whose  subsidiary  in  the  USA  allegedly 

controls the US market. 

It  is  recalled  that  the  aim  of  the  anti-dumping  duty  is  not  to  eliminate  from  the 

Community  market the  imports originating  in a  given third country,  but to  remove 

trade-distorting  effects  of  injurious  dumping  and  to  restore  effective  competition. 

In this respect it should be observed that the duty has been fixed at a  level which 

should  not  prevent  the  Chinese  coumarin  from  remaining  competitive  on  the 

Community  market (see recital (55) of the provisional duty Regulation). 

15 

Moreover,  it should  be  stressed that  during the  investigation  period the  Chinese 

producers  held  a  very  substantial  share  of  the  Community  market  which  was 

consistently  higher  than  that  of  the  Community  producer.  Hence,  the  concrete 

risk exists  that  the  Chinese  producers  themselves  could  acquire  a  monopolistic 

position  should  no  measures  be  taken.  The  risk  of  the  creation  of  such  a 

monopoly  would  also  not  be  in  the  Community  interest.  Furthermore,  the  world 

coumarin  industry  appears  currently  to  be  concentrated  in  two  poles,  one 

Community  producer  with  its  US  subsidiary  and  the  production  in  the  People's 

Republic of China; however, there are indications that other coumarin production 

regions  are  emerging,  e.g.  in  India.  Consequently,  it  is  very  unlikely  that  the 

Community  producer  would 

find 

itself 

in  a  monopolistic  situation  as  a 

consequence  of  the  imposition  of  an  anti-dumping  duty.  Finally,  as  far  as  the 

alleged dominant position of  Rhône Poulenc  Inc. in the  US market is concerned, 

it  is  pointed  out  that  during  the  investigation  period  the  exporters  from  the 

People's Republic of China held a very substantial share of the US market. In this 

regard, it also has to be mentioned that Chinese exports of coumarin to the USA 

are  now  subject  to  anti-dumping  measures,  which  could  lead  to  a  diversion  of 

Chinese exports to the Community market. 

(27)  BEOA maintained  its allegation about the threat of  abuse of a dominant  position 

by  Rhône-Poulenc  S.A  in  relation  to  its  marketing  policy,  consisting  allegedly  of 

guaranteeing  the  delivery  of  a  predetermined  volume  of  coumarin  only  to  users 

which  agree  to  enter  into  a  five-year  purchase  contract.  This  allegation,  which 

was already rejected at the stage of the provisional determinations, has not been 

further  substantiated.  Moreover,  no  formal  complaint  has  been  lodged  with  the 

appropriate  authorities  and, according  to the  information  gathered  in the  course 

of the  investigation,  it has  been found  that'the  marketing  policy  in question  has 

not  been  implemented  at  all.  The  conclusions  expressed  in  recital  (51)  of  the 

provisional duty Regulation are therefore confirmed. 

16 

3. 

Conclusions 

(28)  No  other  arguments  were  made  with  respect  to  Community  interest.  After 

carefully  examining  all  the  arguments  made,  the  Council  is  of  the  opinion  that 

there  are  no  compelling  reasons  not  to  take  anti-dumping  action  in  this  case.  It 

can therefore be considered that it is in the Community  interest to impose  an anti 

dumping duty as set out in recitals (47) to (54) of the provisional duty Regulation. 

H.  DUTY 

(29)  BEOA  argued  that  the  Commission  made  a  methodological  error  in  calculating 

the  underselling  margin  for  the  transactions  occurring  directly  between  the 

Chinese  exporter  and  the  user  in  the  Community,  since  they  did  not  add  a 

distributor  mark-up  to  the  CIF  import  price.  BEOA  claimed  that,  in doing  this  the 

trade  level  difference  would  not  be  removed  for  sales  of  this  kind,  because  the 

injury  elimination  level  established  for  Rhône  Poulenc  SA  included  SG&A  and 

profits  of  its  distributors,  while  no  mark-up  was  taken  into  account  for  the  users 

purchasing  directly  from  the  Chinese  exporters.  In  this  respect,  it  should  be 

observed  that  the  Commission  established  the  injury  elimination  level  by 

including  all  the  costs  and  profits  of  Rhône  Poulenc  SA  distributors  which 

themselves  sell directly to users. Therefore  no mark-up  needs to be  added  to the 

CIF  import  price  of  users  because  the  transactions  were  taking  place  at  the 

same  level of trade  . Furthermore,  it has  been found that the  average  CIF  import 

prices for all distributor-importers  fall within a  narrow scope, and on average,  at a 

significantly  lower  level  than  that  found  for  the  users.  In  particular,  this  price 

difference  is of  a  magnitude  corresponding  tp  the  mark-up  applied  by  distributor 

importers for their resales to thé users. 

17 

This  fact  is  clear  evidence  that  the  PRC  producer/exporters  differentiate  their 

sales  prices  according  to  the  level  of  trade  at which  their  customer  is  situated 

Consequently,  the Council considers that the  comparison  has  been made at the 

same level of trade and adding a mark-up to the CIF import price of  users would 

constitute double counting. The claim for  adjustment  for trade  level difference  is 

therefore  rejected.  The  underselling  determination  as  described  in  recitals  (54) 

and (55)of the provisional duty Regulation is confirmed. 

(30)  Provisional measures consisted of an anti-dumping  duty  in the form of a specific 

amount per tonne. The duty was imposed at the injury elimination level since this 

was  lower  than  the  dumping  margin  and was  established  as  set  out  in  recitals 

(56)  and  (57)  of  the  provisional  duty  Regulation.  No further  arguments  were  put 

forward to contradict this approach. The relevant findings as expressed in recitals 

(23) and (55) are therefore confirmed. Accordingly  the rate of the definitive duty 

should be at the same level as the provisional duty. 

I. COLLECTION OF THE PROVISIONAL DUTY 

(31)  In  view  of  the  dumping  margin  established,  and  the  seriousness  of  the  injury 

caused  to  the  Community  industry,  it  is  considered  necessary  that  amounts 

secured  by  way  of  the  provisional  anti-dumping  duty  should  be  definitively 

collected, 

18 

HAS ADOPTED  THIS  REGULATION: 

Article  1 

1. 

A  definitive  anti-dumping  duty  is  hereby  imposed  on  imports  of  coumarin  falling 

within CN  code ex 2932  21  00  (Taric code 2932  21  00*  10)  and  originating  in the 

People's Republic of China. 

2. 

The  rate of the duty applicable is ECU 3 479 per tonne. 

3. 

Unless  otherwise  specified,  the  provisions  in  force  concerning  customs  duties 

shall apply. 

Article 2 

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

Regulation (EC)  No. 2352/95  shall be definitively collected in full. 

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  in  all 

Member States. 

Done at Brussels, 

19 

ISSN 0254-1475 

COM(96) 103 final 

DOCUMENTS 

EN 

02 

ii 

Catalogue number  : CB-C0-96-111-EN-C 

ISBN 92-78-01424-9 

Office  for Official  Publications of the European Communities 

L-2985  Luxembourg 

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