Proposal for a COUNCIL REGULATION (EC) imposing a definitive anti-dumping duty on imports of unbleached (grey) cotton fabrics originating in the People's Republic of China, Egypt, India Indonesia, Pakistan and Turkey
Date: 1997-04-21
Institutions: European Commission
Subjects: anti-dumping duty, cotton, import, natural fibre, third country

COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 21.04.1997 
COM(97) 160 final 

Proposal for a 

COUNCIL REGULATION ŒO 

imposing a definitive anti-dumping duty on imports of unbleached (grey) cotton 

fabrics originating in the People's Republic of China, Egypt, India, Indonesia, 

Pakistan and Turkey 

(presented by the Commission) 

Explanatory  Memorandum 

(1)  The  Commission, by Regulation  (EC) No 2208/96  (1), imposed  provisional  anti 

dumping duties on imports of unbleached (grey) cotton fabrics originating from the 

People's  Republic  of  China,  Egypt,  India,  Indonesia,  Pakistan  and  Turkey  on 20 

November 1996. 

(2)  After  the  imposition  of  provisional  duties,  interested  parties  were  given  the 

opportunity to submit their comments and, if requested, to be heard. 

(3)  Following  a  number  of  requests  by  exporters  and  importers,  the  scope  of  the 

investigation was adjusted  to exclude medical  gauze, given its particular physical 

characteristics and its very specific final use. 

(4)  Some  claims  submitted  by  exporters  relating  to  the  determination  of  dumping 

margins  were accepted  and the dumping calculations were amended  accordingly, 

where appropriate. The effect  of this was an overall reduction of dumping margins. 

The definitive average margins vary between 13 and  15%. The largest reduction in 

dumping  margin  was  for  Pakistan,  where  the  average  dropped  from  27.9%  to 

14.3%. 

(5)  Following  exporters'  submissions,  the  method  of  calculating  undercutting  and 

underselling  was changed to take account  of the different  product  types existing. 

However,  the  new  method  confirmed 

the  existence  of  substantial  price 

undercutting. 

(1) Official  Journal No L 295 of 20 November 1996, p. 3. 

(6)  Given  the  sensitivity  and  the  strategic  location  of  the  product  in  the  production 

chain,  and  comments  received  from  interested  parties,  the  Community  interest 

aspects  of  the  proceeding  were  extensively  investigated.  The  analysis  confirmed 

that  measures  would  have  beneficial  effects  for  the  Community  industry,  in that 

they  would  allow  it  to  increase  production,  reduce  costs  and  re-establish 

profitability,  while  they  would  not  unduly  affect  the  downstream  industry. 

Therefore, the provisional  conclusions that anti-dumping  measures are not against 

the interest of the Community as a whole were confirmed. 

(7) 

In  accordance  with  Article  9  of  Council  Regulation  (EC)  No  384/96,  the 

Commission  therefore  proposes  that  the  Council  impose  definitive  anti-dumping 

duties on imports of unbleached (grey) cotton fabrics originating from the People's 

Republic  of  China,  Egypt,  India,  Indonesia,  Pakistan  and Turkey.  In view  of  the 

extent  of  the  injury,  it  is  also  recommended  that  the  provisional  anti-dumping 

duties should be definitively  collected to the extent of the amount of the  definitive 

duties imposed. 

COUNCIL REGULATION (EC) NO 

/97 

of.... 

imposing a definitive anti-dumping duty on imports of unbleached (grey) cotton 

fabrics originating in the People's Republic of China, Egypt, India, Indonesia, 

Pakistan and Turkey 

THE COUNCIL OF THE EUROPEAN UNION, 

Having regard to the Treaty establishing the European Community, 

Having  regard  to  Council  Regulation  (EC) No  384/96  of  22  December  1995 on 

protection  against  dumped  imports from countries  not members  of the  European 
Community1, and in particular Article 9 thereof, 

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

Advisory Committee as provided for by the above Regulation, 

Whereas: 

A. PROVISIONAL MEASURES 

(1)  Commission  Regulation  (EC)  No  2208/962  (hereinafter  referred  to  as  'the 

provisional Regulation') imposed a provisional anti-dumping duty on imports into 

1  OJ No L 56 of 6.3.1996, p. 1, referred  to as the Basic  Regulation 

2  OJ No L 295 of  20.11.1996, p. 3 

the  Community  of  unbleached  (grey) cotton  fabrics  falling  within  CN codes  5208 

11  to  5208  19  and  5209  11  to  5209  19  originating  in  the  People's  Republic  of 

China, Egypt, India, Indonesia, Pakistan and Turkey. 

B. SUBSEQUENT  PROCEDURE 

(2)  The Commission continued to seek and verify  all information  deemed necessary  for 

its definitive  findings  and carried out investigations at the premises of importers in 

the Community related to producers/exporters in the countries concerned: 

- Eurotex Trading Corp. GmbH, Hamburg, Germany 

- Mafatlal  Limited, Romaga AG (UK and Switzerland), Lancashire, UK 

(3)  As announced in recital (13) of the provisional Regulation, the Commission  further 

investigated  whether  or  not  gauze  should  be  excluded  from  the  scope  of  this 

proceeding  and  carried  out  investigations  at  the  premises  of  the  following 

companies in the Community: 

- Torval, Torras Valenti S.A., Navarcles, Barcelona, Spain 

- Texpol, Textil Planas Oliveras S.A., Manresa, Barcelona, Spain. 

(4)  Following  the  imposition  of  the  provisional  anti-dumping  measures,  certain 

interested parties submitted comments in writing. 

(5)  Those  parties  who  so  requested  were  granted  an  opportunity  to  be  heard  by  the 

Commission. 

(6)  Upon request, parties were informed of the essential facts and considerations on the 

basis  of  which  it  was  intended  to  recommend  the  imposition  of  definitive  anti 

dumping  duties  and  the  definitive  collection  of  amounts  secured  by  way  of 

provisional  duties.  They  were  also  granted  a  period  within  which  to  make 

representations subsequent to this disclosure. 

(7)  The oral and written comments submitted by the interested parties were considered 

and, where deemed appropriate, taken into account for the definitive findings. 

C. PRODUCT UNDER CONSIDERATION AND LIKE PRODUCT 

(8) 

It should  be recalled that this proceeding  covers all flat  unbleached  (grey) cotton 

fabrics  containing  at least  85% cotton. Grey cotton  fabrics  are produced  in many 

different  types or "constructions", which are defined by a combination of the count 

(weight) of the yarn used, and the number of threads used for both warp and weft 

and the way yarns are interlaced. Moreover, many producers can generally produce 

any construction of grey cotton fabrics on demand. 

(9)  On the basis of the information available at the provisional stage, the Commission 

considered that domestic and export types from  the countries concerned were like 

products within the meaning of Article  1  (4) of the Basic Regulation, as shown in 

recital (12) of the provisional Regulation. It also considered that the types sold on 

the domestic market  in India and the types exported by Chinese companies were 

like products, as well as the types exported  from  all countries concerned  and the 

types produced by Community producers. 

(10)  Following  the disclosure  of provisional findings, several  requests were presented 

for  the  exclusion  of  specific  types  of  grey  cotton  fabrics  from  the  scope  of  the 

proceeding.  The types  in  question  included  fabrics  of  different  constructions  for 

various  specific  uses. These  types  included,  inter alia, certain  fabrics  for  use  in 

embroidery,  fabrics  for  use in polishing disks, and fabrics  for the manufacture  of 

bandages, dressings and medical gauze (referred to as "gauze"). 

(11)  With regard to gauze, the Commission found that: 

-  gauze fabrics have different physical characteristics, given their particularly light 

constructions which renders them generally unsuitable for any other purpose and 

therefore  not  interchangeable  with the  constructions  used,  for  example,  in the 

garment and household furnishing sectors; 

-  gauze  fabrics  have  a  specific  sanitary/pharmaceutical  application,  which  is 

different  from  the other fabrics  used in the textile industry, as the product  can 

only  be  used  to  produce  medical  gauze,  which  is  defined  by  the  "European 

Pharmacopoeia"  set  by  the  Council  of  Europe  (CN  3005  90  31),  and  has  to 

comply with strict hygiene rules; 

- by virtue of their classification  under an individual CN code 5208 1110,  fabric 

for medical gauze is clearly identifiable  as a specific  product and can therefore 

be excluded without prejudicing the effectiveness  of any measures imposed. The 

evasion of any measures by means of fraudulent product mis-descriptions would 

be difficult  and easily detectable. 

Fabrics  for  the manufacture  of bandages, dressings  and medical  gauze,  classified 

under CN heading 5208 11 10, are excluded from the scope of this proceeding. Any 

provisional  anti-dumping  duty  levied  on  this  product  should  consequently  be 

released or reimbursed. 

(12)  With regard to all other types of fabrics for which requests for exclusion from the 

scope of this proceeding were received, it should be stressed that they clearly  fall 

under the like product definition  set out above. They are therefore  included in the 

scope of the proceeding. 

D. EXPORTERS AND PRODUCERS IN THE COUNTRIES OF ORIGIN 

1. 

Individual examination in the context of sampling 

(13)  Several Turkish parties argued that it was contradictory to consider that, on the one 

hand,  a  sample  containing  only  two  companies  would  still  be  representative  of 

Turkish production and exports of the product concerned, but on the other hand to 

refuse to grant individual examination to the companies which so requested. 

The argument raised mixes up the question of the representativeness of the sample 

in Turkey with the question of whether requests for individual examination can be 

accepted,  which  depends  on the burden  represented  by the  number  of  individual 

requests received from all the countries subject to investigation. 

It should be recalled that in recital (26) to (28) of the provisional Regulation, it was 

already concluded that, having regard to Article  17 (3) of the Basic Regulation, no 

individual 

examination 

could  be  granted  because 

the  number  of 

producers/exporters was so large, in a case including several hundred  exporters in 

six countries, that individual examination would have been unduly burdensome and 

would have prevented completion of the investigation in good time. 

E.  DUMPING 

1. 

Normal value 

(a)  Market economy countries 

(i) Construction of normal value methodology 

(14)  Two Egyptian producers/exporters questioned the use of constructed  normal value 

where the domestic prices of another producer/exporter  in the sample  could have 

been used to establish normal value for similar constructions. 

It  should  be  noted  that,  although  some  products  had  the  same  construction,  the 

different  spinning methods, the efficiency  of the looms and the different  qualities of 

cotton used  in Egypt caused  such a large variation  in the cost of the end-product 

that using the price of another producer/exporter as a basis for normal value would 

not have been appropriate. 

(15)  Two  Indian  producers/exporters  claimed  that  normal  value  had  been  incorrectly 

determined  because domestic  sales of second  quality products had been excluded 

from the calculation of normal value. 

Considering  that  exports  to  the  Community  were  first  quality  products,  normal 

value  had to be calculated  on the basis  of the  comparable  product  in  accordance 

with  Article  1 (2)  of the Basic  Regulation,  i.e. first quality  products  sold  on the 

domestic market of the exporting country. 

(16)  Several parties challenged the use of two different  thresholds, namely 5% and 10%, 

to  assess  representativeness  of  respectively  domestic  sales  and  profitability.  One 

party  argued  that  if  domestic  sales  were  considered  unrepresentative  in terms of 

profit, they should equally be considered unrepresentative in terms of SG&A. 

The  argument  raised  appears  to  confuse  the  different  thresholds  used  by  the 

Commission in order to establish (i), whether domestic prices should be used as a 

basis for normal value and, (ii), whether domestic sales are profitable. Reference is 

made to recitals (29) to (36) of the provisional Regulation where the methodology 

followed by the Commission, in conformity  with Article 2 of the Basic Regulation 

and  its  consistent  practice,  is explained  in detail.  For the  sake of  clarification,  it 

should be noted that the fact that some sales, or indeed all sales, appear to be loss-

making  does  not  render  the  SG&A  unreliable  when  constructing  an  appropriate 

normal  value. On the other hand, it is the  Commission's  practice  to  consider the 

entirety  of domestic sales as not being in the ordinary course of trade if less than 

10% of the volume of such sales is profitable  (see recital  (33) of the provisional 

Regulation). This threshold is also used to determine whether the profit realised on 

the  domestic  market  can  provide  an  appropriate  basis  for  the  calculation  of 

constructed normal value. 

(ii) Costs of manufacturing 

(17)  Two Egyptian producers/exporters disputed the Commission's decision to increase 

the reported costs of raw cotton purchases. 

10 

In  one  case,  this  was  done  because  the  producer/exporter  had  failed  to  take  into 

account  the  actual  prices  paid  which  reflected  the  exceptional  increase  in  the 

market  price  of raw  cotton  in the  course  of the  1994/1995  season  (which  covered 

most  of  the  investigation  period).  In  the  other  case,  an  adjustment  was  made 

because  the  reporting  of  raw  cotton  costs  was  based  on  the  financial  year  rather 

than on the investigation period. Provisional findings  are therefore  confirmed. 

(Hi) Selling,  General and Administrative  expenses (SG&A) 

(18)  Several  parties  challenged  the  inclusion  of  financing  costs  in  the  construction  of 

normal value. 

In  that  respect,  it  should  be  noted  that  the  Commission's  consistent  practice  has 

been to include all costs incurred to produce and sell the product  concerned  on the 

domestic  market,  including  financing  costs,  in  the  construction  of  normal  value. 

Financing costs as reported were thus used in the construction of normal value. 

(19)  Two  Indonesian  producers/exporters  with  related  distributors  on  the  domestic 

market  argued  that  the  Commission  had  wrongly  accounted  for  the  costs  of  these 

distributors and requested that the SG&A be reduced to reflect  the limited  activities 

of these related companies. 

11 

In  this  context,  it  should  be  noted  that  it  is  considered  normal  to  treat  sales 

companies  and  the  producer/exporter  with  which  they  are  associated  as  a  single 

economic  unit,  in so  far  as the  sales companies concerned  in this case  carry  out 

functions on the domestic market which are essentially identical to those performed 

by a subsidiary or sales department. Given that the Commission considered that the 

above  conditions  were met  in  this  ease with  regard  to  these  related  distributors, 

their costs were calculated in accordance with Article 2 (5) of the Basic Regulation 

and  taken  into  account  in  the  construction  of  normal  values  for  the  two 

producers/exporters concerned. 

(iv) Domestic profit margin 

(20)  With regard to the profit  margin used  in the construction  of normal  value, some 

producers/exporters  argued  that  domestic  profitability  should  have  been  assessed 

only  on  the  basis  of  those  constructions  sold  both  domestically  and  on  the 

Community market. 

It  should however  be recalled that Article 2 (2) of the Basic  Regulation provides 

that  the  "sales  of  the  like  product  intended  for  domestic  consumption  shall 

normally be used to determine normal value". Therefore,  all domestic sales of the 

like product intended for domestic consumption were used to establish the domestic 

profit  margin, whether or not the particular  construction  was also exported to the 

Community. 

12 

(21)  The Pakistani producers/exporters argued that in calculating domestic profit  for the 

only  producer/exporter  with  domestic  sales  in  the  ordinary  course  of  trade,  the 

Commission  erroneously  excluded  certain  transactions,  the  effect  of  which  was 

artificially  to  inflate  the  profit  margin.  In  addition,  they  argued  that  this  profit 

margin  was  not  representative  of  the  Pakistani  market  and  should  not  have  been 

used  in  the  construction  of  normal  value  for  the  other  three  companies  in  the 

sample,  since  none  of  them  made  a  profit  on  their  domestic  sales  of  the  product 

concerned. 

Article 2 (3) of the Basic Regulation provides that the profit  achieved  on  profitable 

domestic  sales in the ordinary course of trade  should be used in the construction  of 

normal  value  for  companies  with  no  or  insufficient  domestic  sales  of  the  like 

product  in the  ordinary  course  of trade.  In  this  respect,  the  methodology  used  for 

provisional determinations is  confirmed. 

However, on reviewing its calculations, it became apparent to the Commission  that 

certain transactions which had been excluded for provisional determinations  should 

in fact  be included in the turnover. A revised profit  margin was thus calculated  and 

applied  in the construction  of normal  value for  the producer/exporter  concerned  as 

well  as  the  other  three  producers/exporters  which  had  no  or  insufficient  domestic 

sales. 

13 

(b) 

Non-market economy country: the People's Republic of China 

(22)  The  representatives  of  the  Chinese  producers/exporters  argued  that  the  People's 

Republic  of China was now a market economy  country  and therefore  the use of an 

analogue country to determine normal value was inappropriate as Chinese  domestic 

prices and/or production costs should be considered reliable. 

The Commission recognises that economic reforms  are under way in China, and the 

fact  that  the  economy  of  the  People's  Republic  of  China  is  in  transition  from  a 

planned,  fully  State-controlled  economy  to  a  partially  market-oriented  economy. 

However, in accordance with Article 2 (7) of the Basic Regulation which applies to 

the  People's  Republic  of  China,  the  request  could  not  be  granted  and  the 

conclusions of recital (47) of the provisional Regulation are therefore  confirmed. 

2. 

Export price 

(23)  It  was  argued,  in  respect  of  the  sole  Chinese  related  importer  based  in  the 

Community  that  the  dumping  calculations  were  incorrect  as  they  included  all 

Chinese  products  sold  by  the related  importer  on the  Community  market,  and  not 

only those products purchased from  its related producer/exporter  in the sample. 

In this  respect,  it  should  be noted  that,  as all three  Chinese  producers/exporters  in 

the sample were directly or indirectly related via the Chinese  State, all their exports 

of  the  product  concerned  were treated  as if they  had  emanated  from  one  exporter. 

Consequently,  all  three  producers/exporters  were  considered  to  be  related  to  the 

importer in question, and all their export prices were reconstructed  accordingly. 

14 

(24)  It was also argued that, as the above related importer in the Community only acted 

as  an  agent,  the  profit  margin  of  5% used  by  the  Commission  for  provisional 

determinations was too high. 

The functions  performed  by the related company were found  to be those typically 

performed  by  an  importer.  For  the  purpose  of  definitive  determinations,  the 

average profit margin of 4.4% found for two unrelated importers in the Community 

was used. 

(25)  Two Indian producers/exporters which formed part of the same group and sold part 

of  their  production  to  the  Community  through  three  related  trading  companies 

claimed that the Commission erroneously constructed export prices using profit and 

SG&A  margins  disproportionate  to  the  mere  trading  activities  of  the  related 

importers. 

Having  verified  the  information  provided  by  the  three" related  companies,  the 

Commission constructed  export prices on the basis of re-calculated  costs incurred 

between importation and resale. This re-calculation was required because the three 

related companies were unable to demonstrate that the allocation of costs submitted 

to the Commission was historically utilised or properly reflected  the costs relating 

to the product concerned. The Commission consequently made a new allocation of 

costs  on  the  basis  of  turnover  and  a  reasonable  estimate  of  costs  incurred  for 

processed  and  non-processed  textile  goods  sold  in  the  Community.  The  profit 

margin provisionally  estimated at 5% was changed to 4.4% to reflect  information 

received from independent importers in the Community (see recital (24)). 

15 

(26)  One  Indian  producer/exporter  argued  that  the  Commission  should  treat  "master 

contracts"  and  not  invoices  as  individual  transactions,  claiming  that  master 

contracts  determined  the  export  price, and that the  prices  agreed  therein  depended 

on the so called "ready quota" system existing in India. 

The  verification  revealed  that  94  master  contracts  were  applicable  during  the 

investigation  period.  Prices  in the master  contracts  for  identical  grey  cotton  fabric 

types to the same customer  varied to such an extent  from  master contract to  master 

contract that they were completely  unreliable. Moreover,  a random  check  revealed 

that  prices  varied  significantly  between  invoices  and  master  contracts.  It  was 

therefore  concluded  that  master  contracts  could  not  form  a  reliable  basis  to 

determine  export  prices,  which  were  therefore  established  on  the  basis  of  the 

invoice  prices  paid  or  payable  for  the  product  when  sold  for  export  to  the 

Community during the investigation period. 

3. 

Comparison 

(27)  In  accordance  with  recital  (54)  of  the  provisional  Regulation,  adjustments  for  the 

purpose of ensuring  a fair  comparison between normal value and export price were 

granted only when a claim was made within the time limits set for that purpose and 

when the party concerned  could demonstrate the effect  of any alleged  difference  on 

price and price comparability. 

(28)  Several  producers/exporters  challenged  the  Commission's  refusal  to  grant  an 

adjustment  for level of trade. 

16 

Article  2  (10)  (d)  of  the  Basic  Regulation  requires  that  it  be  shown  that  the 

difference  in level of trade has affected  price comparability,  which is  demonstrated 

by  consistent  and  distinct  differences  in  functions  and  prices  of  the  seller  for  the 

different  levels  of  trade  in  the  domestic  market  of  the  exporting  country.  In  the 

absence of substantiated evidence to this effect,  the claims were rejected. 

(29)  All  Egyptian  producers/exporters  companies  challenged  the  Commission's  refusal 

to grant them an adjustment  to normal value for credit costs. 

As  mentioned  in  recital  (57)  of  the  provisional  Regulation,  no  evidence  was 

provided  that the payment  terms had been  agreed  at the time  of  sale, and  no  proof 

was provided that credit terms were a factor taken into account in the  determination 

of the prices charged. Indeed, all three producers/exporters  admitted that prices did 

not  vary  according  to  payment  terms.  Moreover,  the  claims  were  incorrect  in 

respect  of  the  number  of  days  and  interest  rates,  and  consequently  provisional 

findings  are  confirmed. 

(30)  Three  Indonesian  producers/exporters  claimed  that  they  should  have  been  granted 

an allowance for sales of second quality products to the Community. 

For one of them, this claim was taken into account by the calculation of an  adjusted 

normal  value  comparable  to  export  prices  of  second  quality  products  to  the 

Community. 

17 

For  another  producer/exporter,  the  investigation  showed  that  export  prices  for 

products  of  printing  quality  showed  no  difference  compared  to  prices  of  first 

quality products and an adjustment  was consequently not required. 

A  third  producer/exporter  requested  either  exclusion  of  its  export  sales  of  second 

quality  products from the dumping  calculation,  or an adjustment  for  differences  in 

physical  characteristics.  Considering  that these  second  quality  products  fell  within 

the  definition  of  the  like  product,  it  was  decided  not  to  exclude  the  transactions 

concerned  from  the  calculation  of dumping,  but  to  make  an  adjustment  to  normal 

value. 

(31)  Several producers/exporters  claimed that other dates, such as the date of order, the 

date  of  contract  or  the  date  of  payment,  should  be  used  in  preference  to  date  of 

invoice  in  the  dumping  calculation  which  allegedly  better  reflected  the  material 

terms of sale. 

It  should  be noted  that  Article  2 (10) (j)  of the Basic  Regulation  provides  that  the 

date  of  sale  should  normally  be  the  date  of  invoice,  unless  the  date  of  contract, 

purchase order or order confirmation  more appropriately reflects  the material  terms 

of sale. The producers/exporters  concemed  did not demonstrate that the  alternative 

date  they  proposed  more  appropriately  established  the  material  terms  of  sale. 

Therefore,  there  was  no  reason to  depart  from  the  consistent  practice  of  using  the 

date of invoice as the date of sale, and provisional findings  are hereby  confirmed. 

18 

4. 

Dumping margins 

(a)  General methodology 

(32)  Several parties claimed that the methodology used by the Commission to determine 

the  provisional  dumping  margins,  i.e.  comparing  the  weighted  average  normal 

value to the prices of all individual export transactions to the Community, deviated 

from  regular practice and was inappropriate. They stated that the Commission did 

not  demonstrate  that  there  was  a  pattern  of  export  prices  which  differed 

significantly  among  different  purchasers,  regions  or  time  periods,  or  that  the 

weighted  average  to  weighted  average  method  did  not  reflect  the  full  degree  of 

dumping being practised. 

(33)  According to Article 2 (11) of the Basic  Regulation, the dumping  margin  should 

normally be established on the basis of a comparison of a weighted average normal 

value  with  a  weighted  average  of  prices  of  all  export  transactions  to  the 

Community.  However,  if  there  is  a  pattern  of  export  prices  which  differ 

significantly  among different  purchasers, regions or time periods, and if the above-

mentioned  methodology  does  not  reflect  the  full  degree  of  dumping  being 

practised, the dumping margin should be calculated on the basis of a comparison of 

a  weighted  average  normal  value  to  prices  of  all  individual  transactions  to  the 

Community. 

19 

(34)  Following  the  comments  made  by  several  producers/exporters,  the  Commission 

reviewed  all  dumping  calculations  for  all  producers/exporters  investigated  and 

came to the conclusion that establishment of the dumping margin on the basis of a 

comparison of the weighted average normal value to the weighted  average export 

price 

reflected 

the 

full  degree  of  dumping  being  practised  by  all 

producers/exporters in the People's Republic of China, Egypt, Pakistan and Turkey, 

and  some  producers/exporters  in  India  and  Indonesia.  Provisional  findings  were 

amended accordingly. 

(35)  With  regard  to  all  remaining  producers/exporters  in  India  and  Indonesia,  it  was 

confirmed  that  there  was  a  pattern  of  export  prices  to  the  Community  which 

differed  significantly  among different  purchasers, regions or time periods. It also 

established that the calculation of dumping margins on the basis of a comparison of 

the  weighted  average  normal  value to  the  weighted  average  export  price  did not 

reflect  the full  degree of dumping being practised.  For those producers/exporters, 

provisional findings  that dumping margins should be established on the basis of a 

comparison of a weighted  average normal value to prices of all individual  export 

transactions to the Community are confirmed. 

(b)  Dumping margin for cooperating producers/exporters not investigated 

(36)  The provisions of recital (67) of the provisional  Regulation are hereby  confirmed. 

The  dumping  margins  for  cooperating  producers/exporters  which  were  not 

investigated  have  been  based  on the  average  of the  individual  dumping  margins 

calculated  for the producers/exporters  included  in the sample, weighted  on export 

turnover to the Communitv. 

20 

(c) 

Residual dumping margin 

(37)  In  view  of  the  overall  high  level  of  cooperation  in  this  proceeding,  it  was 

considered appropriate to amend provisional findings with regard to the calculation 

of the residual dumping margin, and to use the highest dumping margin found  for 

the producers/exporters in the sample for non-cooperating producers/exporters. 

(d)  Methodology for groups of companies 

(38)  All  three  Egyptian  producers/exporters  questioned  -  but  did  not  oppose  -  the 

provisions  of  recital  (72)  of  the  provisional  Regulation  whereby  they  were  all 

treated as one group and subject to the general rule on groups of companies. 

Due  to  the  fact,  however,  that  all  three  producers/exporters  investigated  had 

common  ownership, the  State, provisional  findings  were confirmed  and the three 

Egyptian producers/exporters treated as one group, in order to avoid circumvention 

of  the  anti-dumping  measures  by  Egyptian  producers/exporters  channelling  their 

exports  to  the  Community  through  the  producer/exporter  with  the  lowest  anti 

dumping duty. 

(39)  One  Indian  producer/exporter  challenged  the  application  of  the  general  rule  to 

calculate a single dumping margin for  companies belonging to the same group. It 

stated that, although technically related  (common shareholding), the companies in 

the group were separate economic and legal entities. 

To  avoid  circumvention  of  the  anti-dumping  measures  by producers/exporters  in 

the  group  channelling 

their  exports 

to 

the  Community 

through 

the 

producer/exporter  with the lowest anti-dumping duty, the Commission applied the 

general rule regarding groups of companies to the Indian group. 

21 

(40)  One  Indonesian  producer/exporter  requested  that  the  assessment  of  dumping  be 

made  globally  for  the  group,  and  not  per  producer/exporter  as  provided  for  in 

recital (69) of the provisional  Regulation. 

Considering,  however,  that  it  has  been  the  Community's  consistent  practice  to 

calculate  first  a  dumping  margin  for  each  producer/exporter  in  the  group  which 

was investigated, and subsequently to use the dumping margins found  to calculate a 

single margin for the group as a whole, the request was rejected. 

(41)  The  methodology  set  out  in  recital  (69)  of  the  provisional  Regulation  is  hereby 

confirmed. 

(e) 

Definitive  dumping margins 

(i) The People's Republic of China 

(42)  The  methodology  set  out  in  recital  (70)  of  the  provisional  Regulation  is  hereby 

confirmed. 

(43)  The  definitive  dumping margin for  the People's  Republic  of China, expressed  as a 

percentage of the CIF import price at the Community border, is 18.9%. 

(ii) Egypt 

(44)  The  definitive  dumping  margin  for  Egypt,  expressed  as  a  percentage  of  the  CIF 

import price at the Community border, is  13.0%. 

22 

(Hi) India 

(45)  For the producers/exporters  or  groups  of companies  in the  sample, the  definitive 

dumping  margins  expressed  as  a  percentage  of  the  CIF  import  price  at  the 

Community border are: 

Century Textiles & Industries Limited 

Coats Viyella India Limited 

Vardhman Spinning & General Mills Limited 

Mafatlal Industries 

17.2% 

12.3% 

5.1% 

12.6% 

Mafatlal Fine Spinning & Manufacturing Producer/exporter Ltd. 

12.6% 

(46)  The definitive dumping margin for cooperating producers/exporters which were not 

investigated, expressed as a percentage of the  CIF import price at the Community 

border, is 15.3%. 

(47)  The  residual  dumping  margin  for  India,  expressed  as .a percentage  of  the  CIF 

import price at the Community border, is 17.2%. 

(iv) Indonesia 

(48)  For the producers/exporters  or groups of companies  in the  sample, the  definitive 

dumping  margins  expressed  as  a  percentage  of  the  CIF  import  price  at  the 

Community border are: 

23 

P.T. Apac Inti Corpora / P.T. Kanindo Prima Perkasa 

P.T. Argo Pantes 

P.T. Daya Manunggal 

P.T. Grand Textile Industries 

P.T. Eratex Djaja 

3.5% 

14.5% 

14.5% 

14.5% 

12.8% 

(4e*)  The definitive dumping margin for cooperating producers/exporters which were not 

investigated, expressed as a percentage of the CIF import price at the Community 

border, is 13.5%. 

(50)  The residual dumping margin for  Indonesia, expressed as a percentage of the CIF 

import price at the Community border, is 14.5%. 

(v) Pakistan 

(51)  For the producers/exporters  or  groups  of  companies  in the  sample, the  definitive 

dumping  margins  expressed  as  a  percentage  of  the  CIF  import  price  at  the 

Community border are: 

Diamond Fabrics Ltd 

Amer Fabrics Ltd 

Kohinoor Raiwind Mills Ltd 

Kohinoor Weaving Mills Ltd 

Lucky Textile Mills 

Nishat Mills Ltd 

Nishat Fabrics Ltd 

9.0% 

9.0% 

22.9% 

22.9% 

15.5% 

9.2% 

9.2% 

24 

(52)  The definitive  dumping margin for cooperating producers/exporters  which were not 

investigated,  expressed  as a percentage  of the  CIF  import  price  at the  Community 

border, is 14.2%. 

(53)  The  residual  dumping  margin  for  Pakistan,  expressed  as  a  percentage  of  the  CIF 

import price at the Community border, is 22.9%. 

(vi) Turkey 

(54)  For  the  companies  in  the  sample,  the  definitive  dumping  margins  expressed  as  a 

percentage of the CIF import price at the Community border are: 

Birlik Mensucat Ticaret ve Sanayi Isletmesi A.S. 

13.6% 

Sôktas Pamuk ve Tarim Uriinlerini Degerlendirme Ticaret ve Sanayi A.S.  17.5% 

(55)  The definitive  dumping margin for cooperating producers/exporters which were not 

investigated,  expressed  as a percentage  of the  CIF  import  price  at the  Community 

border, is  15.2%. 

(56)  The  residual  dumping  margin  for  Turkey,  expressed  as  a  percentage  of  the  CIF 

import price at the Community border, is  17.5%. 

25 

F. COMMUNITY  INDUSTRY 

(57)  The Chinese exporters' questioned the Commission's  methodology  for  determining 

the scope of the Community  industry  on the grounds that the representativeness  of 

the complainant  Community producers had been based on open-market  sales of the 

like  product  only,  whereas  the  production  within  the  EU  destined  for  captive  use 

should  also  have  been  taken  into  consideration.  Including  production  for  captive 

use  would  include,  for  example,  the  production  of  the  like  product  in  integrated 

companies  with  operating  weaving  facilities  which  directly  feed  the  requirements 

of in-house processing. 

The Commission examined this contention but cannot accept it. It is the practice of 

the  Community  institutions,  confirmed  by  the  European  Court  of  Justice,  to 

exclude  captive  production  from  the  calculation  of  total  Community  production, 

where  there  is  a clear  separation  between  the  'captive'  and  'free'  markets.  As  the 

captive weaving to which the Chinese exporters' representative refers  is not sold on 

the open market and does not compete directly with imports of the like product, the 

Commission  concluded  that the output of captive weaving  in the EU should  not be 

included 

in  the  calculation  of  Community  production  for  the  purpose  of 

determining  representativeness. 

26 

(58)  After  the imposition of provisional measures, the Commission received  indication 

that a complaining producer was no longer supporting the complaint. The producer 

was  accordingly  excluded from the  definition  of  Community  industry,  therefore 

reducing  the  representativeness  of  the  complainant  to  56%  of  Community 

production. However, following the disclosure of definitive  findings, the producer 

in question wrote to the Commission declaring to be still supporting the complaint. 

After examining the evidence available, and after direct contacts with the producer, 

the  Commission  decided  to  re-integrate  that  producer  in  the  definition  of 

Community industry. 

It was therefore  confirmed  that the complainant  represents  a major  proportion of 

around 70% of Community production of the product concerned. 

(59)  Furthermore, as a result of the exclusion of medical gauze set out in recital (12) and 

of further  investigation  at the definitive  stage, the relevant  data relating  to  injury 

have been adjusted in order to take account of this exclusion. 

G. INJURY 

5. 

Preliminary remark 

(60)  Following  the  changes  to  the  like  product  definition  set  out  above,  some  of the 

injury  data from  the provisional  Regulation  changed  as outlined  in the  following 

recitals. All data which is not specifically  recalled from the provisional Regulation 

is to be considered as having been confirmed by the Commission. 

27 

6. 

Community  consumption 

(61)  Community  apparent  consumption  rose  from  265,984  tonnes  in  1992. to  266,158 

tonnes  in  1993, to  304,660  tonnes  in  1994 but  dropped  10% to  274,282  tonnes  in 

1995, 

the 

investigation  period.  Over 

the  period  1992-1995,  Community 

consumption rose by 3%. 

7. 

Volume and market share of the dumped  imports 

(62)  The  aggregate  volume  of  dumped  imports  of  the  product  concerned  into  the 

Community  originating  in the  countries  subject  to  investigation  increased  by  16% 

between  1992 and  1994 from  104,330 tonnes in  1992, to  110,741 tonnes in  1993, to 

121,501  tonnes  in  1994.  The  volume  decreased  14%  in  1995  to  104,987  tonnes, 

broadly in line with the development of Community  demand. 

The  development  of  import  volumes,  assessed 

in  relation 

to  Community 

consumption,  led to a substantial  share of the Community market being  maintained 

by the  countries  concerned  of  39.2% in  1992, 41.6% in  1993, 39.9% in  1994, and 

38.3% in the investigation period. 

28 

8. 

Prices of the dumped imports 

(63)  In recital (102) of the provisional Regulation price undercutting was calculated by 

comparing weighted  average  EC producers'  selling  prices with weighted  average 

export prices of all transactions by each producer-exporter concerned. This method 

was disputed  by the  exporters  concerned  as being  imprecise. In order to achieve 

greater  accuracy, the Commission used the following  categories in its assessment 

of the extent of undercutting: Extra coarse (Counts 0-10 Ne), Coarse (Counts 11-20 

Ne), Medium (Counts 21-30 Ne), Higher Medium (Counts 31-40 Ne), Fine (Counts 

41-60 Ne) and Superfine (Counts 61 Ne and above). 

The  results  of  the  comparison  showed  margins  of  price  undercutting  for  all  the 

exporting  producers  investigated,  with  the  exporters  in  each  country  having 

weighted average margins accross all categories ranging up to: 

-China 

-Egypt 

-India 

- Indonesia 

-Pakistan 

34% 

37% 

42% 

49% 

30% 

-Turkey 

21%. 

29 

9. 

Situation of the Community  industry 

(a) 

Data relating to the Community industry as a whole 

(i) Sales and market share of the total Community industry 

(64)  Total sales by the Community producers fell by around  10% over the period,  from 

90,348 tonnes in  1992, to 80,692 in  1993, to 81,913 in  1994, and to 81,873 in the 

investigation  period. Matching this decline, the corresponding  market  share  went 

from  34%  in  1992,  to  30.3%  in  1993,  26.9%  in  1994,  and  29.9%  in  the 

investigation period, a decline of  12% in relative terms over the period. 

(ii) Plant closures and reduction of employment 

(65)  Recital (106) of the provisional  Regulation referred  to plant closures and job  losses 

among  manufacturers  of  the  product  concerned.  Representations  were  made, 

however, which pointed out that the job  losses mentioned include those suffered  by 

integrated  producers  which,  as explained  in recital (57)  above, are  not  included  in 

the injury  investigation. No accurate information  is available however which would 

enable  the  Commission  to  estimate  the  proportion  of  this  figure  which  could  be 

ascribed  to  the  Community  industry  as  defined  in  recital (89)  of  the  provisional 

Regulation. 

30 

(b) 

Data relating to the sampled Community  producers 

(66)  It will be recalled from  recital (89) of the provisional  Regulation that sampling  was 

applied for the purpose of the investigation of  injury. 

ft) Change in product  mix 

(67)  As  mentioned  in  recital  (112)  of  the  provisional  Regulation,  the  Commission 

examined  the  information  on five reference  constructions  which  had  been  used  in 

order to avoid  distortions  to the price comparisons  being  caused  by  changes  in the 

product  mix. The advantage  of continuing to use these five reference  constructions 

together with the six product categories described  in recital (63) above, is that  data 

for  the  former  is available  for  the  period  1992-1995. Three  of these  five  reference 

constructions  fit  into  the  fabric  categories 

'Coarse', 

'Medium'  and 

'Higher 

Medium',  and  can be  considered  as basic  constructions,  with  low value  added  but 

produced  in  high  volumes.  These  three  categories  alone  account  for  80%  of  the 

imports from  the countries concerned. The development  over time of the  quantities 

sold  of these  three  reference  constructions  shows  substantial  decline,  significantly 

greater than the fall  in the total sales of the sampled producers. Sales of these three 

reference  constructions,  representing  about  21% of  sales  in  1992,  dropped  43% 

between  1992 and 1995. 

31 

The  sampled  Community  producers  had  claimed  that  they  had  been  forced  to 

reduce  the  production  of basic  constructions  and  to  move  into  the  production of 

niche  products  as  a  result  of  the  significant  price  undercutting  of  the  dumped 

imports  from  the  exporting  producers.  The  smaller  production  runs  of  niche 

products imply lower volumes, longer machinery stand-still times between batches 

and consequently higher unit costs. 

10.  Conclusions on injury 

(68)  The above conclusions and those in recital (116) of the provisional Regulation are 

confirmed. 

H. CAUSATION 

11. 

Effect of the dumped imports from the countries concerned 

(69)  The exporters alleged that for  injury  to exist, significant  changes must be seen in 

both  the  volume  of  imports  and  their  market  share,  and  there  should  also  be  a 

decline  in export prices of the product  concerned.  Since the product concerned is 

subject  to quotas and voluntary  export restraints, some of the above elements did 

not change significantly.  It was therefore  submitted that there could have been no 

injury. 

32 

In this respect, it should be borne in mind that, according to Article 3 (2) and 3 (3) 

of  the  Basic  Anti-Dumping  Regulation  none  of  the  factors  concerning  import 

volumes,  market  shares  and  prices  listed  in  this  provision  can  necessarily  give 

decisive guidance in an injury analysis. 

As  far  as  the  volumes  and  market  share  of  imports  in  the  present  case  are 

concerned, they actually did not significantly  increase. This situation has to be seen 

in the light of the existence of a quota system limiting imports, which, as has been 

found, has been consistently utilised at high rates (the weighted average utilisation 

rate  for  the  countries  concerned  was  95%  in  1995)  during  the  period  under 

consideration.  Statistics  show that  some exporting  countries  have  even  borrowed 

quantities from other textile categories for their exports of the product concerned. 

However, given the absolute level of the imports concerned and the level of import 

prices, in the present  case  and  in accordance  with Article  3 (2) and  3 (3)  of the 

Basic  Anti-Dumping  Regulation,  injury  has  consisted  in  insufficient  profitability 

being the result of price depression and price suppression  (see recital  (116) of the 

provisional Regulation and recital (67) above). These price levels are explained by 

the characteristics of the quota system in place, which gives companies within the 

exporting  countries  the  incentive  to  compete  for  the  allocation  of  quotas,  and 

consequently for export customers. 

33 

Furthermore, it is considered that injury  can be caused even where export prices are 

rising,  since  these  prices  must  be  seen  in  relation  to  the  Community  producers' 

prices. In the presence  of  significant  price  undercutting,  as  in this  case, and  given 

that the exporters concerned have around 40% of the Community market, it is clear 

that  whether  the  prices  of  the  dumped  exports  are  rising  or  not,  they  will  still  be 

exerting price suppression or price depression or both, and injury  can be suffered  as 

a result. 

(70)  The  Commission's  examination  of  the  basic  constmctions,  as  described  in 

recital (66) above, provides  further  evidence  on the effects  of the dumped  imports. 

The data clearly show that the sales of the constructions which are closest in type to 

those widely  imported  fell  much more  sharply  than total  sales, thus  demonstrating 

the  direct  effect  of  the  substantial  price undercutting  established  for  these  product 

types. 

12. 

Effects  of other factors 

(71)  Various  exporters  and  downstream  users  of the product  concerned  have  contested 

the findings  relating to causation  in the provisional  Regulation, citing  other  factors 

as being behind the injury  suffered  by the Community  industry. 

34 

ft)  Fall in apparent consumption 

(72)  Some exporting countries submitted that it was the decline in consumption  of the 

like product between  1994 and 1995 which was the single most important cause of 

material injury to the Community industry. 

The  Commission  has  examined  this  argument.  Consumption  of  the  product 

concerned  fell  by  10%  between  1994  and  1995;  imports  also  declined. 

Nevertheless, over the period  1992-1995, the dumped  imports from  the  countries 

subject  to  this  proceeding  remained  relatively  stable  with  a  high  (around  40%) 

market share in 1995, and were sold at prices that undercut Community producers' 

prices  to  a  significant  extent.  While  it  is  clear,  therefore,  that  the  Community 

industry was not immune to the effects  of the fall  in demand for the like product, 

the dumped imports caused material injury to Community producers. 

(ii) Imports from other third countries 

(73)  Certain  interested  parties  made  reference  to  the  effect  of  imports  from  third 

countries as a cause of material injury, but no information was provided that would 

cause  an  alteration  to  the  findings  at  recitals (120)  to  (123)  of  the  provisional 

Regulation. These findings are therefore  confirmed. 

35 

(Hi) Increase in raw cotton prices 

(74)  The  Commission's  findings  at  recital (124)  of  the  provisional  Regulation  were 

questioned  by  certain  exporters  on  the  grounds  that  the  rise  in  the  price  of  raw 

cotton  did  not  affect  all  of  the  Community  industry  in  the  same  way,  with  some 

producers  allegedly  less affected  than  others.  Furthermore,  it was  claimed  that  the 

raw  cotton  price  rise  appeared  to  have  been  partially  absorbed  by  the  spinning 

sector, which supplies the Community  industry with cotton yam. (For a description 

of the spinning sector, see recital (80)). 

The Commission has examined these arguments. Although the impact of the rise in 

the price  of raw cotton  on the  Community  industry  may  have been  felt  differently 

by  individual  producers  across  the  Community,  it  was  considered  to  have  been 

significant  overall.  This  conclusion  is  supported  by  the  finding  that  certain  of  the 

sampled  Community  producers experienced  increases  in the cost  of yam of around 

50% between  1992 and 1995. 

As to  partial  absorption  of the  increased  raw cotton prices  by the  spinning  sector, 

no evidence was presented to the Commission in this context. 

13. 

Conclusion on causation 

(75)  The findings presented in recital (125) of the provisional Regulation are  confirmed. 

36 

I. COMMUNITY INTEREST 

14.  The Community interest investigation 

(76)  Based  on the information  available, and taking  account  of the possible  price and 

quantity  changes  of  the  dumped  imports  following  imposition  of  definitive 

measures, the Commission examined the impact of anti-dumping  measures on the 

various sectors of the Community cotton textiles industry. 

To this end, and in order to obtain the clearest possible overview, the Commission 

services sent a questionnaire to all the parties (users, suppliers, importers) who had 

made  themselves  known  in  the  course  of  the  proceeding,  to  various  trade 

associations, which forwarded  it to their members, as well as to other parties who 

requested it. 

(77)  It should be noted that, where appropriate, statistics relating to cotton textiles with a 

cotton content of at least 50% were used in the absence of more accurate statistics 

relating  to  the  product  concerned,  which  has  a cotton  content  greater  than 85%. 

Fabrics with a cotton content exceeding 50% are hereinafter referred to as 'majority 

cotton fabrics'. 

The economic operators concerned in this analysis 

(78)  The various parts of the Community  cotton textiles production  chain are listed in 

the four main categories below. 

(79)  A significant  proportion  of the industry  is vertically  integrated  to  include  at least 

two of the activities in the following four categories. 

37 

ft) Suppliers 

(80)  Spinners:  the  primary  raw  material,  raw  cotton,  is  imported  from  the  producing 

countries  and  is  spun  into  yam.  Spinning  is  a highly  automated  process,  and  EU 

yam  producers  have  reached  a  high  level  of  efficiency, 

largely  due  to  the 

widespread use of open-end spinning technology. 

(ii) The Community Industry 

(81)  Weavers: grey (i.e. unbleached) yam is woven into fabric.  This grey cloth has then 

to  undergo  an additional,  separate  finishing  stage  where  it  is bleached  and  printed 

or dyed. 

(Hi)  Users 

(82)  Finishers: the bleaching, printing and dyeing of unbleached  cotton fabrics  is carried 

out  by  finishers.  The  grey  cloth  is first washed  and  bleached  to  prepare  it  for  the 

absorption  of  dye  or  printing  inks, then  it  is  printed  or  dyed.  These  activities  are 

generally, but not always, performed  by the same company. 

(83)  Makers-up: the finished  cloth is cut and sewn to make garments, household  goods, 

or industrial goods by makers-up. This is the most labour intensive stage, especially 

in  the  clothing  industry  where  the  production  processes  are  not  normally 

automated. 

38 

ftv)Importers/Con  verters 

(84)  Importers/converters:  the  operators  who  supply  the  Community's  makers-up  with 

cloth  are  the  converters  who purchase  grey  cloth,  often  imported,  and  who  recruit 

the services of finishers  to have the fabric processed to the maker-up stipulations. 

15. 

The Community  industry 

(a) 

Nature and structure of the Community  industry 

(85)  Total  production  of  the  product  concerned  in  the  Community  was  around  94,000 

tonnes  in  1995.  It  will  be  recalled  from  recital  (58)  that  the  Community  industry 

accounts for around 70% of this figure. 

(86)  The  Community 

industry  is  composed  mainly  of  small  and  medium-sized 

enterprises. Production is capital intensive and highly automated. It should be noted 

that  grey  cotton  fabric  is  an  intermediate  product,  with  a  high  degree  of 

standardisation  and  price  sensitivity  in the  basic,  most  common  constmctions,  but 

subject to fashion  changes, particularly in niche areas of the market. 

(87)  The  cotton  weaving  industry  as  a  whole,  including  the  Community  industry  and 

integrated  producers  (as  discussed  below),  employs  115,000  people.  It  is  not 

possible  to  exactly  allocate  employees  to  the  product  concerned,  as  it  is  produced 

by  the  same  companies  and  on  the  same  machines  which  produce  the  majority 

cotton  fabrics. 

39 

(b) 

Viability of the Community  industry 

(88)  It will  be  recalled  from  recital  (108) of the provisional  Regulation  that,  during  the 

period  considered  for  the  analysis  of  injury,  the  domestic  industry  rationalized  its 

production process, with a high level of machinery  replacement. 

(89)  Though  the  Community  industry  is  mainly  oriented  towards  the  Community 

market  (less  than  15% of  total  sales  of  the  product  concerned  are  exported),  their 

export  performance  improved  12%  between  1992-1995,  from  10,904  to  12,247 

tonnes.  The  Commission  considers  this  as  an  important  indication  that  the 

Community weaving industry is viable and internationally  competitive. 

(c) 

Expected  effects  of  the  imposition  of  anti-dumping  measures  on  the 

Community  industry 

(90)  The Commission  based  its analysis  of the  impact  of the anti-dumping  measures  on 

Community industry on the data provided by the sampled Community producers. 

(91)  To  assess  the effects  of the  anti-dumping  measures  on the  Community  industry,  it 

is necessary to examine first  of all the possible reactions of the exporting  producers 

in  the  countries  concerned.  This  has  been  done  on  the  assumption  of  constant 

demand conditions. 

(92)  Following  the  imposition  of duties, the prices  of the  imported  like  product  can  be 

expected  to  rise.  This  price  rise  would  be  reflected  in  a  fall  in  the  volumes 

imported,  thus  leading  to  a reduction  in  market  supply,  allowing  the  Community 

industry to increase output, particularly of those basic constmctions most subject to 

40 

pressure from  the dumped  imports, as explained  in recital  (67) and (70) above. The 

Community  industry's  prices  could  be  expected  to  increase  to  some  extent,  but 

certainly  not  by  anything  like  the  level  of  the  duty.  The  increases  in  volume, 

however, would serve to reduce unit costs of production and enable the  Community 

industry to restore its financial  situation. 

(d) 

Comments  received 

ft) Comments received from  the Community industry 

(93)  The  Community  industry  has  stressed  the  importance  for  the  Community  cotton 

textiles  industry  of  a  viable  Community  cotton-weaving  industry.  This  would 

maintain competition, employment  levels, and prevent dependence on imports. The 

industry  has  also  argued  that  its  continued  existence  would  be  of  benefit  to  the 

upstream  spinning  industry  by assuring  an important  source of demand  for  yam. It 

is also  argued that there would  be benefits  for  the downstream  sectors arising  from 

diversity of supply. 

(94)  Many claims were also submitted  from  users and importers relating to the effect  of 

the  measures  on  the  Community  industry.  In  summary,  it  was  alleged  that  the 

measures would have no substantial positive outcome on their situation. 

41 

(ii) Competition from  other imports 

(95)  It  was  contended  that  if  the  anti-dumping  measures  bring  about  a  shift  in  the 

demand  away from  the  import  of the dumped  products, there would  be an  increase 

in the demand for imports of grey cotton fabrics  from  other third countries. 

(96)  Regarding  imports  of  grey  cotton  fabrics  from  other  third  countries,  it  was  found 

that  it cannot  be excluded  that, within  the limits of the existing trade  arrangements 

they  may  increase  following  the imposition  of measures; about  30% of the  market 

is  supplied  by  imports  which  will  not  be  subject  to  the  anti-dumping  measures. 

Exporters in these countries would presumably  try to increase their market  share at 

the expense of their competitors from the countries concerned by this proceeding. 

Some  users  pointed  out  that  other  third  countries  are  at  the  moment  not  able  to 

supply  fabrics  of the  same  quality  as those  produced  by  Community  industry  and 

by  the  exporting  producers  in the  countries  concerned.  Although  no  evidence  was 

supplied  on this point,  it would  appear that  imports  from  other third  countries  will 

not, therefore,  prevent  the  Community  industry  from  taking  advantage  of the  anti 

dumping measures. 

(Hi)  Community industry's production  capacity and supply shortage 

(97)  It  was  alleged  that  the  anti-dumping  measures  would  have  the  effect  of  creating 

supply  shortages  since  the  Community  industry  does  not  have  the  capacity  to 

satisfy  Community demand for the product  concerned. 

42 

(98)  The Commission  established  that the Community  industry  was indeed  operating  at 

a  high  rate  of  capacity  utilisation  during  the  period  under  consideration.  It  should 

be noted, however, that, over this period, the Community  industry  also reduced  its 

maximum  capacity  in terms of machine hours per year. This was due, among  other 

factors, to a reduction in working hours, which means that the Community  weavers 

would be able to increase capacity by increasing the number of hours worked  in the 

case of an increase in demand. 

* • 

It  should  also  be  mentioned  that,  since  production  of  grey  cotton  fabrics  uses  the 

same  equipment  and  labour  as  other  kinds  of  fabrics,  the  Community  producers 

could  switch productive  capacity  towards  the product  concerned  after  any  demand 

increase subsequent to the imposition of measures. 

(iv) Import substitution towards bleached, dyed and printed  fabrics 

(99)  It was  claimed  by  some users that the anti-dumping  measures  will  have no  effect, 

as  importers  will  simply  switch  to  importing  bleached  and  finished  fabrics. 

However,  no  evidence  was  provided  to  support  this  allegation.  Indeed  it  is  worth 

recalling that bleached fabrics are also subject to international trade arrangements. 

As  to  bleached  fabrics,  the  only  data  available  to  the  Commission  relating  to  the 

imports  of  bleached  fabrics  are  Eurostat  figures,  which  indicate  that  in  1995  the 

imports of bleached fabrics amounted to a negligible quantity (10,610 tonnes) 

43 

relative to the total  size of the Community  grey cotton  fabric  market, which was 

around 464,000 tonnes. Moreover, Eurostat figures also show an average value in 

1995 of 6.72 ECUs per tonne, which was almost twice the Eurostat average import 

value  relating  to  unbleached  fabric.  In  any  event,  indications  are  that  finishers 

prefer to control the bleaching process themselves for quality control reasons. 

As to the switch towards finished  fabrics, this is examined further  below in recital 

(130)etseq. 

(e) 

Effect of non-imposition of the measures 

(100) As stated in recital (127) of the provisional Regulation, should definitive  measures 

not  be  imposed,  the  negative  trend  of  the  Community  industry  would  continue, 

with  the  possibility  of  its  disappearance.  The  6,200  people  employed  by  the 

Community industry would be those most directly affected.  In this context, the loss 

in employment among the sampled complainants mentioned in recital (115) of the 

provisional Regulation is noted. 

ft)  Conclusions 

(101) The  expected  demand  increase  for  the  Community  industry  would  enable  it  to 

choose a strategy for recovery from their current situation of financial losses. 

(102) While the industry's prices would not rise to the extent of the duty, the Community 

industry could be expected to improve its sales volume and recover market share in 

basic  constmctions.  This  volume  increase  will  reduce  unit  costs  and  increase 

profitability. 

44 

(103) In conclusion, the analysis of the Community industry shows that it is stmcturally 

viable  and  that  measures  would  be  effective  in  affording  the  industry  the 

opportunity to recover from the injury suffered  (see recital (130) of the provisional 

Regulation). Therefore, it is in the interests of the Community industry to introduce 

measures. 

16.  The supplier industry 

(a) 

Situation of the Community spinning industry 

(104) Community spinners employed around 72,000 people in  1994 (the figure refers to 

EU 12). The total yam production in the Community, including all fibres, amounts 

to 1,2 million tonnes. An estimated 25% of this was used for the production of the 

like product, implying that  18,000 people are employed spinning yam destined for 

production of the product concerned. 

(105) Over the period  1992-1996 there was an 8% increase in cotton yam sales quantities 

for the companies examined. Production capacity increased by 8% and the rate of 

capacity  utilisation,  though  slightly  decreasing,  was  still  about  81%  in  1996. 

Insufficient  information  was  provided  to  establish  a  trend  in  production  costs, 

though there are indications of an increase in variable costs in 1995. This was most 

probably  due  to  the  growing  raw  cotton  prices  already  examined  in  the  injury 

analysis at recital (124) of the provisional Regulation and which was mentioned by 

some parties  as a major  factor  of instability.  Indeed, raw cotton  represents about 

50% of spinners' total costs. This could also explain their poor profit  performance 

(average return on sales -0.31% in  1995, -0.93% in  1996). Employment decreased 

bv about 9%. 

45 

(b) 

Effect of the imposition / non imposition of measures 

(106) If  total  Community  cotton  weaving,  i.e.  including  integrated  producers,  is 

considered,  the  percentage  of  yam  used  in  the  production  of  the  like  product 

represents over 25% of spinners' output. This means that, though spinners can  find 

other outlets for their production (mixed fabrics, knitting, etc.), a major  decline in 

Community production of the product concerned would substantially affect them. 

(107)  If  anti-dumping  measures  are  imposed,  the  improved  situation  of  Community 

weavers  will  benefit  spinners  in that they  will  retain  an important  sales channel, 

with higher  sales volumes and the possibility  to negotiate more profitable  prices. 

On the  other  hand,  should  measures  not  be  imposed,  spinners  face  the  risk  of a 

major  fall in demand not only from the complainants, but also from the integrated 

weavers examined below. 

17.  Users, Importers and Makers-up 

(108) The  downstream  sectors  that  will  be  examined  below  consist  of  integrated 

producers,  converters/importers, finishers and  makers-up.  Although  these  parties 

may  operate  at  different  stages  of  the  downstream  production  chain,  given  the 

degree of integration of this industry, it has been found  appropriate to investigate 

them together. 

46 

(a) 

Integrated  producers 

ft) Description 

(109) Integrated producers in this context are those who weave and finish and/or make up 

finished  goods.  They  use  all  or  most  of  their  fabric  production  for  their  own 

internal  downstream  consumption  or  for  sales  to  related  companies,  and  only 

occasionally  sell to unrelated customers. Although integrated producers are not part 

of  the  complaining  Community  industry,  since  they  do  not  compete  directly  with 

the  dumped  imports,  they  can  be  considered  to  have  an  interest  in  the  present 

proceeding,  since they  may  also  suffer  from  the  competition  of  finished  fabrics  or 

made-up goods manufactured  using grey fabrics sourced at dumped prices. 

(110) Total  Community  output  of woven  majority  cotton  fabrics  was  464,000  tonnes  in 

1995,  of  which,  according  to  the  industry's  estimates,  the  output  of  the  product 

concerned  was  325,000  tonnes. The  integrated  producers  represented  an  estimated 

72% of these figures. 

(ii) Effect of the imposition of measures 

(111)Since  integrated  producers  are  indirectly  affected  by  the  dumped  imports,  they 

could  be  expected  to  benefit 

indirectly  from  anti-dumping  measures.  The 

competitiveness of their finished  fabrics and made-up goods is expected to improve 

relative  to  the  goods  produced  using  the  dumped  imports.  Furthermore,  as  the 

prices  of  the  dumped  imports  increase,  it  becomes  more  attractive  for  them  to 

employ  own-produced  grey  fabrics,  with  positive  consequences  for  their  weaving 

employment. 

47 

(112) However,  some  downstream-integrated  weavers  who  concentrate  on  finishing 

and/or making-up, and source most of their  grey fabric  requirements  from  imports, 

oppose the  imposition  of measures. The impact  of the measures  on this part of the 

industry,  however,  varies  according  to  each  individual  company's  dependence  on 

imports from the countries concerned, so no clear conclusion can be drawn as to the 

effect  on this sector. 

Nevertheless,  in  view  of  the  substantial  part  of  the  Community  weaving  used  for 

internal  consumption  (72%),  and  of  the  considerable  share  that  it  has  in  the  total 

Community  finishing  (48%,  as  described  below),  it  can  be  concluded  that  the 

overall  impact  of  anti-dumping  measures  on  the  integrated  weavers  would  be 

positive. 

(Hi) Effect of the non-imposition of measures 

(113) If measures  are not  imposed,  integrated  producers  would  continue  to  suffer  a  cost 

disadvantage  vis  à  vis  any  EU  competitors  who  use  the  dumped  imports.  As  a 

consequence,  their  in-house  weaving  could  cease  to  be  viable  and  they  might  be 

obliged to close down their weaving activities. 

In this respect, it should be noted that total majority  cotton weaving output,  captive 

and non-captive, in the Community  shrunk  from  around  515,600 tonnes in  1992 to 

464,000  in  1995,  and  in  the  same  period  88  weaving  plants  closed  in  Austria, 

France, Germany, Italy, Spain and the United Kingdom, with the loss of 8,625 jobs. 

The  overall  declining  trend  of  the  sector,  in  the  absence  of  measures,  would 

therefore  continue, with consequent further  losses of employment. 

48 

(b) 

Converters and  finishers 

ft) Introduction 

(114) After  the  imposition  of  the  provisional  measures,  many  representations  were 

received  from  users  and  importers,  reiterating  the  claims  in  recital  (128)  of  the 

provisional  Regulation.  The  measures  were  alleged  to  severely  affect 

the 

competitive  position  of  Community  finishers  vis  à  vis  third  countries'  exporters, 

with  substantial  losses  in  turnover  and  jobs,  due  to  the  substitution  of  fabrics 

imported  in  grey  state  and  finished  in  the  EU  with  fabrics  imported  in  'finished 

state.  It  was  alleged  that  the  consequence  may  even  be the  demise  of  Community 

finishing industry. 

(ii) Structure and size of the downstream industry 

(115) The  investigation  relating  to  users  was  based  on  the  information  submitted  from 

finishers, whether independent or integrated  in groups, importers and converters, as 

well as on general information  relating to the sector. 

(116) The  analysis  of the  impact  of  anti-dumping  measures  on the  downstream  industry 

has  to  take  into  account  its  particular  structure.  The  grey  fabric  is  not  usually 

purchased  directly  by  those  who  process  it,  but  by  a middleman  (converter),  who 

can source from  EU weavers or from  imports. The converter then passes the  fabric 

to the finisher, who does not normally take ownership but works on commission. 

49 

(117) The finishing  industry  is capital  intensive and highly price competitive.  However, 

in comparison  with unbleached  fabric,  the  finished  fabric  has more possibilities  of 

differentiation  and  a higher  value  added,  and  requires  higher  levels  of  know-how. 

Though  there  are  some  simple  patterns  and  colours  which  are  fairly  standardized, 

the product is fashion-sensitive  and the designs tend to vary from  year to year. This 

enhances  the  importance  of  such  factors  as  delivery  speed  and  the  possibility  for 

the customer  to discuss  and modify  the final output.  According  to the  submissions 

received,  these  elements  are,  together  with  price,  major  factors  in  choosing  the 

finisher.  They  explain  why  the  fabrics  finished  in  the  Community,  unlike  grey 

fabrics,  can  be  expected  to  maintain  an  advantage  compared  to  imported  finished 

fabrics. 

(118) The  production  of  the  finishing  sector  was  estimated  on  the  basis  of  the  figure 

mentioned  in  recital  (110)  above  at  464,000  tonnes  of  total  output  of  majority 

cotton woven fabrics  in the EU. Adding total imports of grey (221,000 tonnes)  and 

bleached (10,000) fabrics and excluding exports (12,700 tonnes) of grey fabrics, the 

total  of the  majority  cotton  fabrics  printed  and  dyed  in the  EU  is  682,000  tonnes. 

The fabrics containing more than 85% of cotton accounts for 78% of this  figure. 

(119) Imports of finished  fabrics  were 37,700 tonnes in  1995, with a growing trend in the 

period  examined  (+17% for  Eurl2  from  1992 to  1995) representing  a market  share 

of 5% of the total market for finished  goods. 

50 

(120) Total employment  in the finishing  sector was estimated  at  150,000 people in  1995. 

The employment in the sector is declining, following  the general trend of the textile 

industry  (-9%  between  1992  and  1994).  Taking  into  account  that  the  product 

concerned  only  represents  a  part  of  total  Community  finishing,  and  the  size  of 

integrated  finishing,  the  number  of jobs  in  independent  finishing  of  the  product 

concerned is estimated at around 23,000. 

(121) No estimate is possible of the personnel  employed  by the importers and converters. 

However,  given  that  these  companies  are  traders  and  service  providers  with 

minimal capital investment, their employment levels appear to be relatively  low. 

(Hi) Effect of the anti-dumping measures on prices  of finished  fabrics 

(122) It  is  expected  that  the  anti-dumping  measures  would  increase  the  sales  prices  of 

finished  fabrics, since the price of the raw material would have increased. 

(123) It  is  stated  in  recital (92)  that  the  Community  industry's  price  increase  would  be 

unlikely  to reflect  the  full  amount  of the  duty.  Some  importers  and  users  claimed 

that,  after  the  imposition  of measures, the prices of grey  cotton  fabrics  not  subject 

to  the  measures  would  also  increase  by  an  amount  close  to  the  duty  rate.  This, 

however,  appears  unfounded  as  the  high  degree  of  competitiveness  of  the  grey 

fabric  market  makes  it  unlikely  that  producers  not  subject  to  the  measures 

(representing  60% of the market in  1995) would have the freedom  to increase their 

prices. Consequently,  it is concluded that the average price increase of grey  fabrics 

will be considerably lower than the average duty rate. 

51 

(124) In order to estimate the impact of the measures on prices of the finished goods, the 

Commission calculated an average proportion of the grey fabric  in the production 

cost and in the price of the finished fabric. The analysis of the questionnaire replies 

revealed a wide diversity of this ratio, depending on the weight and quality of grey 

fabric used and on the quality of finishing. An average proportion was calculated at 

45%  for  respondent  companies  for  all  finished  fabrics.  However,  given  the 

variation  among  companies  (from  22  to  67%)  and  the  diversity  of  the  products 

involved,  it  was  decided  to  base  the  Commission's  conclusions  on  an  average 

between  45% and  a figure  provided  by the German finishers' association, which 

estimates the average proportion of the full  cost attributable to grey fabric at 36%. 

A profit  margin of  6% was added, estimated  from  the profit  margins reported by 

the converters. 

(125) The  analysis  of  the  submissions  showed  an  average  profit  on  sales  in  1995  of 

around  15% for finishers on commission, and of around 6% for converters. Both 

profit  margins  are  considered  to  be  adequate  given  the  nature  of  the  sectors  (a 

capital  intensive  industry  in  the  case  of  finishers;  a  trading,  service-providing 

industry for converters), and allowing, if necessary, a partial absorption of the cost 

increase  after  the  imposition  of definitive  anti-dumping  measures. Therefore,  the 

claim that both converters and finishers  operate at low profit  margins and cannot 

absorb any duty-induced cost increase was not confirmed. 

52 

(126) Different  scenarios were envisaged, taking into account different  options relating to 

the reactions of the market. A 'maximalist scenario' was considered which assumed 

a  price  increase  by  all  suppliers  by  the  full  amount  of  the  duty,  which  averages 

15.7%,  and  no  absorption  by  the  converters  and  finishers.  The  average  price 

increase in this case is estimated  at 7.1% with a ratio of 45% and 5.6% with a ratio 

of  36%/ 

(127) A  'minimalist  scenario'  was  also  estimated.  It  is  based  on  the  assumption  of  no 

price  increase  by  the  suppliers  not  affected  by  the  anti-dumping  duties,  which 

brings the average price increase by suppliers down to 6.3%. Moreover,  it assumes 

that  both the converters  and the finishers  absorb a part of the duty  with  a  decrease 

of  their  profit  margin  of  1 %  each.  The  price  increase  so  calculated  on  finished 

fabrics varies from  0.7% to  1.3%, according to the ratio used. 

(128) The  two  calculations  above  are  considered  to  be  the  extremes  of  a  range  of 

possibilities.  The  Commission  estimates  as  most  probable  an  average  scenario, 

implying  a moderate  price  increase  from  the  suppliers  of  grey  fabrics  not  affected 

by the anti-dumping duties and the  1% duty absorption described above. 

The  average  price  increase  for  Community  producers  was estimated  at  2%, on  the 

basis  of  the  minimum  price  increase  required  to  offset  the  losses  referred  to  in 

recital (114) of the provisional  Regulation. 

For other third country  exporters, the Commission,  on the assumption  that they  are 

not  market  leaders, used  an  increase  of  10.2%, a weighted  average  of  the  average 

anti-dumping  duty,  15.7%  and  the  estimated  price  increase  of  2%  for  the 

Community producers. 

53 

The  subsequent  price  increase  for  the  finished  fabric  is estimated  as  varying  from 

2% to 3%, according to the cost ratio adopted. 

ftv) Impact on converters 

(129) The  converters  are  those  who  directly  bear  the  cost  increase,  and  have  to  decide 

whether  to  pass  it  on  to  their  customers  or  to  absorb  it,  partly  or  totally.  It  was 

alleged  that  the  converters,  given  the  low profit  margins  and  price  competition  in 

the  sector,  will  be  squeezed-between  the  inability  to  absorb  the  cost  increase  and 

the impossibility of passing it on to their customers. 

As  to  the  possibilities  of  absorption,  the  Commission's  view  is  set  out  in 

recital (125). Further, the converters' past behaviour  suggests a considerable  ability 

to pass on cost increases to their customers. Between  1994 and  1995, in response to 

a  generalised  increase  in  input  costs  and  a  decrease  in  demand  (the  cost  of  raw 

cotton increased of around  15%, and the Community weavers increased their prices 

of  8.6%)  converters  were  able  to  increase  their  prices  by  6.66%.  Given  the  value 

added at this stage, this increase was enough to offset  the cost increase, and to keep 

the sector profitable  despite the fall in demand. 

An  alternative  course  of  action  for  converters  could  also  be  to  switch  to  products 

which  are  not  affected  by  the  measures,  such  as  Community  production,  imports 

from  other third countries, or mixed fabrics. They also have the option of importing 

finished  fabrics  directly,  although the analysis below  suggests that this is unlikely. 

It  is  concluded  that,  as  far  as  converters  are  concerned,  therefore,  anti-dumping 

measures  may require  some adaptation  on their part, but  are not expected  to  affect 

them unduly. 

54 

(v) Impact on finishers 

(130) Finishers, who are not going to be directly affected  financially  by the measures as 

they do not purchase the product concemed, could  suffer  a decrease  in activity if 

there  is  a  substantial  switch  in  demand  towards  imports  of  finished  fabrics  (so-

called "substitution  effects"). 

(131) The Commission evaluated, on the basis of the information  submitted, the reaction 

of market demand to a price increase in the fabrics  finished  in the Community, in 

order to arrive at an estimate of any possible substitution effects. 

In the period  1992-96 the quantities finished by Community finishers increased, on 

an indexed basis, from  100 to 108 between 1992 and 1994 and then decreased to 99 

in  1995 and to 97 in 1996. The prices of the finished fabrics  sold by converters in 

the same period increased from  100 in 1992 to  115 in 1995, then declined to 99 in 

1996. 

The figures show that no clear relationship exists between prices obtained and the 

level of activity of finishers.  Indeed, while in  1995 the market reacted strongly to 

the increase in prices, in 1996 the price fall was not reflected  in a quantity increase. 

Similarly,  the  moderate  price  increase  in  1994 did  not prevent  a quantity rise of 

over 6%. 

55 

(132) As  far  as  imports  of  finished  fabrics  from  third  countries  are  concerned,  no  clear 

link  between  the  Community  production  of  the  product  concerned  and  these 

imports  can be identified  from  the data analysed.  Imports  show a steadily  growing 

trend  at  falling  prices. On the  other hand, the quantities  imported  represent  5% of 

quantities  finished  in the Community.  These  figures  do not  support the  allegations 

of  the  likelihood  of  a  substitution  effect.  Indeed,  the  Commission  received  no 

evidence  showing  the  existence  of  a  sizeable  spare  finishing  capacity  in  any  third 

country,  nor  are  there  any  indications  that  this  capital-  and  know how-intensive 

industry  could  be  built  up  in  the  foreseeable  future.  Furthermore,  imports  of 

finished  fabrics  are  also  subject  to  quota  and  licence  arrangements,  which  means 

that their growth is necessarily restricted for the time being. 

In the  light  of the above, and contrary  to the claims  of major  substitution  effect,  it 

was concluded that an estimated  increase in the price of finished  fabrics  of between 

2% and 3% is not expected to cause a substantial  shift  in demand from  Community 

finishing  to imports from third countries. 

(133) It was also alleged that, for an industry as capital intensive as the finishing industry, 

even a moderate decrease in the quantities processed may raise unit costs to such an 

extent  as  to  make  continued  production  unprofitable.  However,  the  finishers 

examined  were  able  to  maintain  high  profit  margins  even  when  the  quantities 

processed  decreased:  in  1995 they  had  a  15% return  on  sales, despite  a fall  in  the 

quantities processed of 9.7%. 

56 

(134) The  Commission  concludes,  therefore,  that  the  imposition  of  anti-dumping 

measures  is not  likely  to  cause  a  substitution  of  Community  finished  fabrics  with 

imports.  The  claims,  submitted  by  users,  of  significant  disruptive  effects  on  the 

Community finishing  industry were therefore found to be highly  exaggerated. 

(vi) Consequences for  employment 

(135) In view of the above, no undue impact of the anti-dumping measures on the-activity 

and employment  levels for  converters  and finishers can be expected. Nevertheless, 

the  intensity  of  any  effects  will  also  depend  on  the  strategy  chosen  by  the 

converters:  should  they  decide  to  significantly  switch  to  trading  finished  fabrics, 

the  impact  on  finishers  would  be  stronger.  But,  as  explained  in  recitals  (132)  to 

(134)  above,  the  recourse  to  imports  of  finished  fabrics  does  not  appear  to  be  a 

credible alternative for converters. 

(136) It  can  be  expected,  however,  that  some  parts  of  the  industry  which  rely  more 

heavily  on the dumped  imports will suffer  a loss of activity, the extent  of which  is 

very  difficult  to  predict.  It  will  depend  on  the  possibilities  of  these  parts  of  the 

industry  to  absorb  the  duty  and  on  their  ability  to  turn  to  different  sources  of 

supply. On the other hand, it also appears that any losses suffered  by these  finishers 

could  be  offset  by  improvements  gained  by  integrated  finishers  or  by  those  who 

mainly  use  Community  grey  fabrics,  which  would  both  become  more  competitive 

after the introduction of definitive  measures. 

57 

(vii) Effects of non imposition of measures 

(137) In  the  event  that  definitive  measures  were  not  to  be  imposed,  some  users  could 

continue to benefit  from  imports at dumped prices, with an advantage on those who 

use  Community  production  or  are  integrated  in  weaving.  Should  the  Community 

weaving  industry  be  severely  harmed,  however, the whole  finishing  market  would 

suffer,  as  Community  grey  production  still  feeds  more  than  two  thirds  of  total 

Community  finishing. 

(c)  Makers-up 

ft) Characteristics of the industry 

(138) Making-up  is the  segment  of the cotton  industry  employing  the  largest  number  of 

people.  It  was  estimated,  on  the  basis  of  the  total  size  of  the  sector  and  of  the 

amount  of cotton  input, that  390,000 jobs  are involved  in the making-up  of  cotton 

goods. 

(139) Making-up  is also the stage with, on average, the highest value-added,  though  this 

varies widely from  product to product. For instance, the value added to the  finished 

fabric  can be  very  low for  a basic bed  linen  set (only  25% of total  cost,  including 

cutting, hemming  and packing), but much higher  for  a piece of clothing,  such  as a 

shirt,  where  it  can  amount  to  70%. This  creates  a  gap  between  low  value-added, 

basic  products,  which  are  very  price  sensitive,  and  whose  production  is  largely 

being  relocated  in  low  labour  cost  countries,  and  high  value  added,  fashion 

products. 

58 

(H) Impact of the anti-dumping measures 

(140) It has been alleged  by some users that the negative consequences of the  imposition 

of measures would  extend  to makers-up, as they would  face  a cost  increase  with  a 

consequent  loss  of  competitiveness  relative  to  imports  of  garments  and  of  home 

textiles from third countries. 

(141) On  the  basis  of  the  information  submitted,  a variable  average  ratio  of  the  cost  of 

finished  fabrics  in the sales prices up to 50% was found.  With the average  increase 

of  2 to  3% for  finished  fabrics  estimated  in recital  (128)  above,  their  price  would 

rise  by  less  than  2%  at  worst,  without  even  considering  the  possibility  of  any 

absorption. 

(142) In  the  light  of  the  above,  and  using  the  information  available,  the  Commission 

services  concluded  that  the  anti-dumping  measures  will  not  negatively  affect 

the 

economic position of Community makers-up. 

18. 

Conclusion 

(143) Information  received  from  parties and  information  otherwise  available  allowed  the 

Commission  to  evaluate  the  various  interests  involved,  as  stipulated  in  Article  21 

(1)  of the basic  Regulation,  and the  overall  effect  of the  imposition  or  of the  non-

imposition of anti-dumping measures. 

In carrying out this examination, the Commission  gave special consideration to the 

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

effective  competition. 

59 

(144) As  to  the  Community  industry,  the  effects  of  the  measures  can  be  expected  to 

afford  it  the  opportunity  to  restore  profitability  and  to  remain  active  in the  grey 

cotton  sector, with  consequent  beneficial  effects  on employment  and  competitive 

conditions on the Community market. 

(145) Despite  the  claim  of  the  Community  spinners  to  be  strongly  dependent  on 

Community  weavers, this  was not  fully  supported  by the  results  of the analysis. 

Nevertheless,  it  was  shown  that  any  improvement  to  the  Community  weavers 

would be expected to have a positive impact on spinners. 

(146) It should be added that the positive impact of the measures would not be limited to 

the  Community  industry, but would  extend to the whole of Community  weaving 

and to the integrated downstream industry linked to it. 

(147) The allegations of dismptive effects  on the downstream industries have either not 

been  substantiated,  or were found  to be exaggerated,  especially  as to the  alleged 

substitution effects,  though some negative consequences on a part of the  finishing 

industry cannot be excluded. 

(148) When  the  position  of  all  sectors  involved  is  considered,  it  cannot  be  clearly 

concluded,  on the  basis  of  all  the  information  submitted,  that  the  application  of 

anti-dumping measures would be against the overall interest of the Community. 

(149) In the light of the above, the conclusions drawn in recital (130) of the provisional 

Regulation, concerning the Community interest, are confirmed. 

60 

J. DEFINITIVE  DUTY 

(150) On  the  basis  of  the  conclusions  on  dumping,  injury,  causation  and  Community 

interest  set  out  above,  the  Commission  considered  the  form  and  the  level  of  the 

anti-dumping measures to be taken. 

(151) Given  the  wide  variety  of  constmctions  from  the  countries  concerned,  the 

Commission  is  of  the  opinion  that  an  ad-valorem  anti-dumping  duty  is  the  most 

appropriate form of measure. 

(152) For  the  purpose  of  establishing  the  level  of  the  definitive  duty,  account  has  been 

taken  of  the  dumping  margins  found  and  of  the  amount  of  duty  necessary  to 

eliminate the injury  sustained by the Community  industry. 

(153) It  will  be  recalled  from  recital  (133)  of  the  provisional  Regulation  that  since  the 

injury  consists  principally  of  price  suppression,  loss  of  market  share  and,  in 

particular,  lack  of  profitability  or  losses,  the  removal  of  injury  requires  that  the 

industry  should  be  put  in  a  position  where  prices  can  be  increased  to  profitable 

levels.  In  order  to  achieve  this, the prices  of the  imports  concemed  originating  in 

the countries currently under investigation should be increased  accordingly. 

(154) For  calculating  the  necessary  price  increase,  the  Commission  considered  that  the 

actual prices of these imports should be compared with a selling price which would 

more  accurately  reflect  the  costs  of  production  of  Community  producers  plus  a 

reasonable  profit. 

61 

(155) A number of exporters questioned the profit  margin of 8% on tumover which was 

mentioned in recital (133) of the provisional Regulation on the grounds that it was 

too high in relation to levels experienced in recent years: the most favourable  profit 

margin  for  the  sampled  Community  producers  recently  was  around  2%.  The 

Commission cannot accept this, however, because 2% is inadequate to ensure the 

financial  viability  of a capital-intensive  industry.  In the course of the proceeding, 

profit  levels  of  5% and  upwards  were  observed  in  sectors  of  the  cotton  textiles 

industry  with very  low capital requirements. In the  light of this, the  Commission 

considers 8% to be a reasonable margin for the cotton weaving sector. 

(156) The average weighted selling prices charged during the investigation period of the 

Community  industry  for  each of the six categories described in recital (63) above 

were increased in order to achieve the overall minimum amount of profit  required. 

The resultant prices thus established were compared with the prices of the dumped 

imports used to calculate undercutting as outlined above. 

(157) The differences  between these two prices, expressed  on a weighted  average basis 

and as a percentage of the free-at-the-Community-frontier  price, were: 

-  China 

-  Egypt 

45% 

49% 

- 

- 

- 

India 

34% to 73% 

Indonesia  41% to 81% 

Pakistan 

46% to 54% 

-  Turkey 

11% to 25%. 

62 

(158) Where the margins of dumping found, in respect of a particular exporting producer, 

were below the corresponding  increases  in export prices necessary to remove the 

injury,  as calculated  above, the definitive  duties  imposed  are to be limited  to the 

dumping  margin established.  This was the  case for  all  but one of the  companies 

concerned. 

The anti-dumping duty proposed for companies which cooperated, but which were 

not  investigated,  is  the  average  dumping  margin  for  the  sample  or  the  average 

margin necessary to remove injury, whichever is lowest. 

The anti-dumping  duty  for  non-cooperating  companies  is equivalent  to either the 

highest  dumping  margin  or  the  highest  margin  necessary  to  remove  injury 

calculated for the producers/exporters  in the sample, whichever is the lowest. The 

highest dumping margin was used for all countries. 

K. FINAL PROVISIONS 

(159) Several Turkish parties protested that Turkey has been treated as any third country 

despite the fact that it has a Customs Union with the Community. 

Article 44 (2) of Decision  1/95  of the EC/Turkey  Association  Council  states that 

the modalities of implementation of anti-dumping measures set out in Article 47 of 

the Additional Protocol to the Association Agreement still apply. The procedure of 

Article  47  of  the  Additional  Protocol  to  the  Association  Agreement  was  indeed 

applied,  and  the  Association  Council  as  well  as  the  Customs  Union's  Joint 

Committee kept regularly informed. 

63 

(160) On  18 January  1996, the  EC/Turkey  Association  Council  was  formally  informed 

that the Commission had  received  a complaint  alleging that  imports  of  unbleached 

cotton  fabrics  from,  inter  alia,  Turkey  were  being  dumped  and  thereby  causing 

injury  to the corresponding Community  industry. 

On 23 Febmary  1996, the EC/Turkey Association  Council was further  informed  of 

the( initiation  of the proceeding  and given  a copy of the non-confidential  version of 

the complaint.  It was also informed  of the decision to apply sampling techniques. 

As  provided  for  in  Article  47  (1)  of  the  Additional  Protocol  to  the  Association 

Agreement,  an  application  was  formally  made  to  the  Association  Council  on  8 

August  1996 after  the investigation had shown that the Turkish  producers/exporters 

were practising  dumping.  Should they wish to do so, the latter were also invited  to 

give undertakings in accordance with Article 8 of the Basic Regulation. 

On  20 November  1996, after  the tree  month  period  provided  for  in  Article  47  (2) 

(a)  of the  above  Agreement  had  elapsed,  the  Commission  notified  the  Council  of 

Association of its decision to impose provisional anti-dumping measures. 

Moreover,  on  19 November  1996, the  Customs  Union  Joint  Committee  had  also 

been  informed  of the  Commission's  intention  to  impose  provisional  anti-dumping 

measures. 

On 21 November  1996, a copy of the provisional  Regulation was forwarded  to the 

Association Council. 

64 

(161) Finally,  the Association  Council  was notified  and provided  with  full  disclosure  of 

the definitive  facts  and findings,  as provided  for  in Article 47 (2) of the Additional 

Protocol  to  the  EC/Turkey  Association  Agreement.  The  Customs  Union  Joint 

Committee  was  informed  of  the  intention  to  impose  definitive  anti-dumping 

measures. 

(162) One  Turkish  party  sought  the  annulment  by  the  Court  of  First  Instance  of  the 

initiation  of the present  proceeding3.  In its  Order  of  16 December  1996, the  Court 

of  First  Instance,  dismissing  the  application,  confirmed  that  the  initiation  of  the 

proceeding  against  Turkey  in the  above  circumstances  was  not  incompatible  with 

the provisions of the Association Agreement. 

(163) In 

their  comments  on 

the  disclosure  of  provisional 

findings, 

several 

producers/exporters  indicated  that they  might  wish to propose undertakings  before 

definitive  anti-dumping measures were imposed. In the absence of any  undertaking 

being  offered,  all  producers/exporters  are  subject  to  the  anti-dumping  measures 

provided in this Regulation. 

3 Case T-75/96, Sôktas v. Commission 

65 

L. COLLECTION OF THE PROVISIONAL  DUTIES 

(164) In  view  of  the  magnitude  of  the  dumping  margins  found  for  the  exporting 

producers  and  countries, and  in the light  of the seriousness  of the injury  caused  to 

the  Community  industry,  it  is  considered  necessary  that  the  amounts  secured  by 

way  of  provisional  anti-dumping  duties  for  transactions  involving  the  product 

concerned should be definitively  collected at the level of the definitive  duties, 

HAS ADOPTED THIS REGULATION: 

Article 1 

1.  Definitive  anti-dumping  duties  are  hereby  imposed  on  imports  of  flat  unbleached 

(grey) cotton fabrics,  falling  within CN codes 5208  11 90, 5208  12 to 5208  19 and 

5209  11 to 5209  19 and originating in the People's Republic of China, Egypt, India, 

Indonesia, Pakistan and Turkey. 

2. 

Save for the exporters listed in Tables 3 and 4 and in the Annex to this  Regulation, 

the  rate  of  the  definitive  anti-dumping  duty  applicable  to  the  net,  free-at-

Community-frontier  price, before duty, shall be as follows: 

66 

TABLE 1: 

Country 

Rate of duty 

Taric additional 

The People's Republic of China 

Egypt 

India 

Indonesia 

Pakistan 

Turkey 

18.9% 

13.0% 

17.2% 

14.5% 

22.9% 

17.5% 

code 

89ÔÔ 

89ÔÔ 

8900 

8900 

89ÔÔ 

89ÔÔ" 

' 

The  exporters  listed  in  the  Annex  to  this  Regulation  shall  be  subject  to  the 

following  rates of anti-dumping duty: 

TABLE 2: 

Country 

Rate of duty 

Taric additional 

Tndïâ" 

' 

Indonesia 

Pakistan 

Turkey 

TTS% 

13.5% 

14.2% 

152% 

code 

8909 

89ÏÔ 

89ÏÏ 

89Ï2 

The companies  listed below shall be subject  to the following  rates of  anti-dumping 

duty: 

67 

TABLE 3: 

Country 

Manufacturer 

Rate of duty 

Taric additional 

India 

Coats Viyella India Ltd 

Vardhman Spinning & General Mills Ltd 

Mafatlal  Industries 

Mafatlal  Fine Spg. & Mfg. 

12.3% 

5.1% 

12.6% 

12.6% 

code 

8914 

8915 

8916 

8917 

TABLE 4: 

Country 

Manufacturer 

Rate of duty 

Taric additional 

Indonesia 

P.T.  Apac  Inti  Corpora  /  P.T.  Kanindo 

3.5% 

Prima Perkasa 

P.T. Eratex  Djaja 

12.8% 

code 

8918 

8922 

TABLE 5: 

Country 

Manufacturer 

Rate of duty 

Taric additional 

Pakistan 

Diamond Fabrics Ltd 

Amer Fabrics Ltd 

Lucky Textile Mills 

Nishat Mills Ltd 

Nishat Fabrics Ltd 

9.0% 

9.0% 

15.5% 

9.2% 

9.2% 

code 

8923 

8924 

8927 

8928 

8929 

68 

TABLE 6: 

Country 

Manufacturer 

Rate of duty 

Taric additional 

Turkey 

Birlik  Mensucat  Ticaret  ve  Sanayi 

13.6% 

Isletmesi A.S. 

Sôktas  Pamuk  ve  Tarim  Degerlendirme 

11.4% 

Ticaret ve Sanayi A.S. 

code 

8930 

8931 

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

apply. 

Article 2 

1. 

The amounts secured  by way of provisional  anti-dumping  duties under  Regulation 

(EC) No 2208/96 shall be definitively  collected. 

2.  Amounts secured provisionally in excess of the definitive  rate of anti-dumping  duty 

shall be released. 

3. 

The amounts secured provisionally  on unbleached  gauze products falling  under CN 

Code 5208 1110 shall be released. 

69 

Article 3 

Where any producer provides sufficient  evidence to the Commission that it did not 

export the goods described in Article  1(1) during the investigation period, that it is 

not  related  to  any  exporter  or  producer  subject  to  the  measures  imposed  by  this 

Regulation  and  that  it  has  exported  the  goods  concerned  after  the  investigation 

period,  or that  it has  entered  into  an  irrevocable  contractual  obligation  to  export  a 

significant  quantity to the Community, then the Council, acting by simple  majority 

on  a  proposal  submitted  by  the  Commission  after  consulting  the  Advisory 

Committee, may amend Article  1 (2) by adding that producer to the parties listed in 

the Annex. That producer would then be subject to the duties in Table 2 of Article 1 

above  for  producers  in  India,  Indonesia,  Pakistan  and  Turkey,  or  to  the  duties  in 

Table  1  above for producers in China and Egypt. 

Article 4 

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, 

1997 

For the Council 

70 

Annex 

India 

A.S.P.G. Subbiah Nadar & Sons, Dhalavaipuram 

All India Handloom Fabrics Marketing Co-operative Society Ltd, Madras 

Alpha Mills Pvt Ltd, Karur 

Amex Exports, Karur 

Anglo French Textiles, Pondicherry 

Arcot Textile Mill Ltd, Madurai 

Arun Fabrics, Tirupur 

Amn Textiles, Rajapalayam 

Ashima Fabrics, Bombay 

A.S. Marimuthu,  Samusigapuram 

Atlas Export Enterprises, Kamr 

Ayyappan Textiles Ltd, Madurai 

B.K.S. Mills, Tirupur 

B.N. Sardar & Sons, Calcutta 

Bharat Vijay Mills, Kalol 

Bhiwani Denim & Apparels Ltd, Faridabad 

Bonanza Overseas Pvt. Ltd, Bombay 

Chhaganlal Kasturchand & Co. Ltd, Bombay 

Emperor Trading Co., Timpur 

Esskay International, Bombay 

Forbes Gokak Ltd, Bombay 

Garden Weaves Pvt. Ltd, Timpur 

71 

GDJD Exports, Madras 

Govindji Trikamdas & Co., Bombay 

I A Intercontinental, Madras 

Ideal Expo Fabrics, Salem 

Inter Globe Services, Bombay 

Indra Exports, Jalandhar 

Kançria Chemicals & Industries Ltd, Ahmedabad 

Karamal Garment Exports, Madras 

Keshavlal Talakchand, Bombay 

Kishandas Kikani, Bombay 

Kothari Industrial Corporation Ltd, Madras 

Loyal Textile Mills Ltd, Kovilpatti 

M.S. Mathivanan,  Komarapalayam 

M.U.A. Arumugaperumal  & Sons, Chatrapatti 

Maharashta State Textile Corporation Ltd, Bombay 

Naatchiar Textile Producers/producer/exporters,  Chatrapatti 

Navnitlal & Producer/exporter,  Bombay 

Niyati Overseas, Madras 

Nowrosjee Wadia & Sons Ltd., Bombay 

N.W. Exports, Bombay 

Parag Trading Corporation, Bombay 

Patodia Syntex Ltd, Bombay 

Piramal Sons Ltd, Bombay 

Pothys Cotton Products PVT.LTD., Srivilliputtur 

Pradeep Investments Pvt. Ltd, Bombay 

Prathishta Weaving & Knitting Producer/exporter Ltd, Coimbatore 

72 

Preemier Textile, Timpur 

Preeti Impex, Tiruchengodu 

Premier  Enterprises 

Premier Mills Ltd, Coimbatore 

Premier Textile Producers/producer/exporters,  Chatrapatti 

R. D. Traders, Bombay 

Rajnarayan  Hosiery Exports Pvt Ltd, Coimbatore 

Rama Qualitex Ltd, Bangalore 

Ramkumar Mills Ltd, Bangalore 

Rawsitasa Exports, New Delhi 

Rega Textiles, Komarapalayam 

Ruchi Fabrics Ltd, Indore 

S. Nikhil, Bombay 

Sadhaka Exports 

Sajjan Textiles Mills Ltd, Bombay 

Sajjan Udyog Export Ltd, Bombay 

Senthil Textiles, Timpur 

Shanker Kapda Niryat Pvt. Ltd, Bombay 

Sheela Apparel Exports Pvt. Ltd, Bombay 

Sheth Exports, Bombay 

Sheth Investments & Trading Producer/exporter  Ltd, Bombay 

Singhania Exports, Bombay 

Sitalakshmi Mills Ltd, Madurai 

Sivakkumar Mills, Palladam 

Sree Rangsan Textiles Pvt. Ltd, Komarapalayam 

Sri Adhilakshmi Warping & Sizing Mills, Erode 

73 

Sri Balaji  Fabric, Timpur 

Sri Dhavamani Textiles, Erode 

Sri Rajasekar  Textiles, Chatrapatti 

Sri Rani Lakshmi Gng. Spg. & Wvg. Mills P. Ltd, Madurai 

Sri Saravanaa Exports Producer/exporter, Tamil Nadu 

Srinivasa Textiles, Chatrapatti 

Standard Industries Ltd, Bombay 

Sudha Mills (India) Pvt. Ltd, Bombay 

Supreme Bandages, Chatrapatti 

Tamarai Mills Ltd,  Coimbatore 

Texcot Exports Pvt Ltd, Bombay 

The Bombay Dyeing & Manufacturing  Co. Ltd, Bombay 

The Hindoostan  Spinning & Weaving Mills Ltd, Bombay 

The Lakshmi Mills Producer/exporter Ltd, Coimbatore 

The Morarjee  Gokuldas Spinning & Weaving Producer/exporter Ltd, Bombay 

The Ruby Mills Ltd, Bombay 

The Western India Cottons Ltd., Kerala 

Thiagarajar  Mills Ltd, Madurai 

Trident Textile Mills Ltd, Madras 

Vadivel  Sizing & Weaving Mills Pvt. Ltd, Timpur 

Varadhalakshmi Mills Ltd, Madurai 

Virudhunagar Textile Mills Ltd, Madurai 

World-Tex Limited,  Chaziabad 

Yam Syndicate Ltd, Calcutta 

74 

Indonesia 

PT. Tyfountex  Indonesia, Solo 

PT. Sandratex, Jakarta 

PT. Batik Keris, Jakarta 

PT. Danliris, Jakarta 

PT. Catur Jantra, Jakarta 

PT. Panca Bintang, Jakarta 

Gabungan Koperasi Batik Indonesia, Jakarta 

PT. Primatexco, Jakarta 

PT. Bina Nusantara Prima, Bandung 

PT. Batam Textile, Jakarta 

PT. Tata Adi Pratama, Bandung 

PT. Pacific Express, Denpasar 

PT. Bintang Agung, Jakarta 

PT. Adetex, Bandung 

PT. Maha Mujur Textile, Bandung 

PT. Five Star Industries, Bandung 

PT. Bandung Djaja  Textile Mills, Bandung 

Pakistan 

•  Abdur Rahman Corporation Ltd, Karachi 

•  Adamjee  Enterprise 

.  ACME Mills (Pvt) Ltd, Karachi 

•  Ajaz  Enterprise 

•  Akhtar Textile Industries 

75 

Al-Aziz Hosiery International, Faisalabad 

Al-Karam Textile Mills, Karachi 

Al-Shahid Weaving Industries 

Al-Rehmat Traders (Pvt) Ltd, Faisalabad 

Anjum Textile Mills (Pvt) Ltd, Faisalabad 

Arshad Corporation (Pvt) Ltd, Faisalabad 

Arzoo Textile Mills Ltd, Faisalabad 

Asjad Textile (Pvt) Ltd 

Associated Knitwear (Pvt) Ltd, Karachi 

Ayaz Textile Mills Ltd, Lahore 

Aziz Sons 

Be Be Jan Pakistan (Pvt) Ltd, Faisalabad 

Bismillah Fabrics (Pvt) Ltd 

Bismillah Textiles (Pvt) Ltd 

Chawala Enterprises 

Chenas Fabrics & Processing 

Colony Sarhad Textile Mills Ltd, Karachi 

Cotton Arts (Pvt) Ltd 

Dawood Textile Printing Indu 

Decent Industries, Faisalabad 

Decent Textiles, Faisalabad 

Elahi Enterprises Limited, Lahore 

Elahi Spinning & Weaving Mills Ltd, Lahore 

En Em Industries Ltd 

Excel Textile Mills, Karachi 

Fabrics International 

76 

Fabtex Corporation, Karachi 

Faizan Shehzad (Pvt) Ltd 

Falcon Textile Corporation 

Fazal Abdullah Exports (Pvt) Ltd, Faisalabad 

Fine Fabrics (Pvt) Ltd 

First Textile Ltd 

Ghazi Fabrics International Ltd, Lahore 

Globe Managements (Pvt) Ltd 

Gohar Enterprises 

Gul Ahmed Textile Mills Ltd, Karachi 

Gulistan Weaving Mills Ltd, Karachi 

Gulshan Weaving Mills Ltd, Karachi 

H.A. Industries (Pvt) Ltd, Faisalabad 

H.K. M. Exports (Pvt) Ltd 

Haji Khuda Bux Amir Umer 

Hajra Textiles, Karachi 

Husein Ind., Karachi 

ICC Textiles Ltd, Lahore 

Image Fabrics (Pvt) Ltd, Faisalabad 

Imran Textiles 

Ishan Yousuf Textile (Pvt) Ltd 

Ishaq Textile Mills Ltd, Faisalabad 

J.K. Brothers Pakistan (Pvt) Ltd, Faisalabad 

J.K. Sons (Pvt) Ltd, Karachi 

Jetex Industries (Pvt) Ltd, Karachi 

Kam International, Karachi 

77 

Kausar Textile Industries (Pvt) Ltd 

LatifHansel(Pvt)Ltd 

Linox International (Pvt) Ltd 

Lucky Impex, Karachi 

Lucky Tex,, Karachi 

M.A.S. Textiles (Pvt) Ltd 

M.F.M.Y. Industries Ltd, Karachi 

M.K. Sons (Pvt) Ltd, Faisalabad 

M.N. Textiles (Pvt) Ltd, Karachi 

Mabro Tex Industries 

Mahmood Textile Mills Ltd, Multan 

Majeeda Textiles (Pvt) Ltd, Faisalabad 

Master Textile Mills Ltd, Lahore 

Megatex Limited, Karachi 

Mian Textile Industries Ltd, Lahore 

Modem Textile Mills, Karachi 

Mohammad Farooq Textile Mills Ltd, Karachi 

Mohib Exports Ltd, Lahore 

Mohib Fabric Industries Ltd, Lahore 

Mohib Textile Mills Ltd, Lahore 

Mukati Corporation 

Mutual Trading Corporation, Karachi 

Nakshbandi Industries Ltd, Karachi 

Nash Garments (Pvt) Ltd, Karachi 

Naveed Industries (Pvt) Ltd, Karachi 

Naveena Industries (Pvt) Ltd, Karachi 

78 

Nisar Textiles Corporation 

Nishatex Enterprises 

Nu-Tex (Pvt) Ltd 

Oberoi Textile Mills, Lahore 

Orient Textile Pakistan (Pvt) Ltd 

Parsons Industries (Pvt) Ltd, Karachi 

Prosperity Weaving Mills Ltd, Lahore 

Regency Textiles Ltd, Lahore 

Reliance Weaving Mills Ltd, Multan 

Reliance Exports Ltd, Multan 

Rizwan Enterprises 

Roomi Enterprises (Pvt) Ltd, Multan 

S.S. Textiles 

Saaqis Fabrics 

Saba Textiles (Pvt) Ltd, Karachi 

Sadaqat Textile Mills (Pvt) Ltd, Faisalabad 

Sadiq Sons Textiles (Pvt) Ltd 

Sakina Textile Industries (Pvt) Ltd, Karachi 

Samin Textiles Ltd, Lahore 

Saya Weaving Mills (Pvt) Ltd, Karachi 

Service Fabrics Ltd, Lahore 

Shahzad Siddique (Pvt) Ltd, Faisalabad 

Shams Textile Mills Ltd, Karachi 

Shahraj Fabrics (Pvt) Ltd, Lahore 

Sharif Textile Industries (Pvt) Ltd, Faisalabad 

Sitara Textile Industries 

79 

Sleep & Style, Karachi 

Sumira Fabrics (Pvt) Ltd, Faisalabad 

Suraj Cotton Mills Ltd, Karachi 

Syncotex Agencies, Karachi 

Taha Textile (Pvt) Ltd, Karachi 

Tanveer Weavings (Pvt) Ltd, Lahore 

Tariq Enterprises 

Tex Arts, Faisalabad 

The Cresent Textile Mills Limited, Faisalabad / Karachi 

United Textile Printing Industries (Pvt) Ltd, Faisalabad 

Worldover Enterprises (Pvt) Ltd, Faisalabad 

Xebec Textiles, Faisalabad 

Yakoob Trading Co., Karachi 

Yousaf Weaving Mills Ltd, Lahore 

Yunus Brothers, Karachi 

Zahidjec Fabrics (Pvt) Ltd, Faisalabad 

Zahoor Industries (Pvt) Ltd, Faisalabad 

Zamzam Weaving & Processing Mills, Faisalabad 

Zaur Textile Mills, Karachi 

Zebtex Corporation 

80 

Turkey 

Bossa Ticaret ve Sanayi Isletmeleri T.A.S., Adana 

Exsa Export Sanayi Mamulleri Satis ve Arastirma A.S., Adana 

Teksmobili Tekstil Sanayi ve Ticaret A.S., Istanbul 

Kipas - Kahramanmaras Iplik Pamuk Ticaret ve Sanayi A.S., Kahramanmaras 

Kipas Textile Industries Inc.,  Kahramanmaras 

Burdur Mensucat  Sanayii ve Ticaret A.S., Ulus/Ankara 

Ataç  Anteks  Dokuma  Fabrikasi  Hikmet  Ataman  ve  Ortaklari  Tic.  ve  San.  A.S., 
Yenikôy/Antalya 

81 

ISSN 0254-1475 

COM(97)  160 final 

DOCUMENTS 

EN 

02  11 

Catalogue  number  :  CB-CO-97-148-EN-C 

ISBN 92-78-18330-X 

Office  for  Official  Publications of the European  Communities 

L-2985  Luxembourg 

?2L