Proposal for a Council Regulation (EC) amending Regulation (EEC) No 3482/92 imposing a definitive anti- dumping duty on imports of certain large electrolytic aluminium capacitors originating in Japan
Date: 1997-12-11
Institutions: European Commission
Subjects: Japan, anti-dumping duty, electrical equipment, import, industrial product

COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels,  11.12.1997 
COM(97) 697  final 

Proposal for a 

COUNCIL REGULATION (EC) 

amending Regulation (EEC) No 3482/92 imposing a definitive anti-dumping duty on 

imports of certain large electrolytic aluminium capacitors originating in Japan 

(presented by the Commission) 

EXPLANATORY  MEMORANDUM 

1.  Attached  is  a  proposal  for  a  Council  Regulation  amending  Regulation  (EEC)  No 

3482/92  imposing  a  definitive  anti-dumping  duty  on  imports  of  certain  large 

electrolytic alumium capacitors originating in Japan. 

2.  The  proposed  act  concerns  a  review  investigation  pursuant  to  Article  11  (3)  of  the 

Basic  Anti-dumping  Regulation  which  has  led  to  the  conclusion  that  one  Japanese 

producer  (Rubycon  Corporation)  has  decreased  its  dumping  margin  from  30.1  %  to 

4.2 %. 

3.  The proposed act therefore envisages the reduction of the duty rate for this company to 

4.2 %. 

COUNCIL REGULATION (EC) No 

of 

amending Regulation (EEC) No  3482/92 imposing a definitive  anti-dumping duty on 

imports of certain large electrolytic aluminium capacitors originating in Japan 

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 

Community (') and in particular Article  11 (3) thereof, 

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

Committee, 

WHEREAS: 

1  OJ No L 56,  6. 3 1996, p.l. Regulation as amended by Regulation (EC) No 2331/96 (OJ No L 317, 

6. 12. 1996, p. 1). 

A. 

PROCEDURE 

1.  Measures in force 

(1) 

In December  1992, the Council, by Regulation (EEC) No 3482/92 (2), imposed a 

definitive  anti-dumping  duty  on  imports  of  certain  large  aluminium  electrolytic 

capacitors (hereinafter  "LAECs") originating in Japan.  For Rubycon  Corporation 

(hereinafter  "Rubycon"), the rate of the definitive  anti-dumping  duty amounted  to 

30.1%  expressed  as  a  percentage  of  the  net,  free  at  Community  frontier  price, 

before  duty.  The  investigation  that  led  to  the  imposition  of  these  measures  is 

hereinafter  referred  to as "the initial investigation". 

2. 

Request for a review  investigation 

(2) 

In  September  1996, Rubycon  lodged  a request  for  an interim  review pursuant  to 

Article  11  (3)  of  Council  Regulation  (EC)  No  384/96  (hereinafter  the  "Basic 

Regulation").  Rubycon alleged that the continued imposition  of the anti-dumping 

duty  would  no  longer  be  necessary  to  offset  the  dumping  as  established  in  the 

initial investigation. 

OJNoL353.  3. 12.  1992, p. 1. 

3. 

Review  investigation 

(3) 

The  Commission  considered  that  Rubycon  had  submitted  sufficient  prima  facie 

evidence  to justify  an interim  review.  Consequently,  the  Commission  announced  -

on  17  December  1996  -  by  a  notice  published  in  the  Official  Journal  of  the 

European  Communities  (3)  the  initiation  of  a  review  investigation  pursuant  to 

Article  11 (3) of the Basic Regulation and commenced an investigation. 

Since  no  other  interested  party  had  submitted  sufficient  evidence  justifying  the 

initiation  of  a review  investigation,  the investigation  was  limited  to  Rubycon.  The 

investigation  concerned the aspects of dumping only. 

(4) 

The  Commission  officially  advised  Rubycon,  the  representatives  of  the  exporting 

country,  two  unrelated  importers  and  the  complainant  in  the  initial  investigation 

(hereinafter  "FARAD")  of  the  initiation  of  the  review.  Interested  parties  were 

given  the  opportunity  to  make  their  views  known  in  writing  and  to  request  a 

hearing.  All parties who so requested were granted a hearing. 

(5) 

The  investigation  covered  the  period  of  1  October  1995  to  30  September  1996 

(hereinafter  referred  to  as  "the  investigation  period").  For  the  purpose  of  this 

investigation,  the  geographical  scope  of  the  investigation  was  the  Community  as 

composed at the time of initiation of this review. 

3  OJ No C 381,  17. 12. 1996, p. 7. 

(6) 

The  Commission  sent  questionnaires  to  all  parties  known  to  be  concerned  and 

received replies from Rubycon, its related importer in the Community (hereinafter 

Rubycon UK) and two unrelated importers in the Community. 

(7) 

The  Commission  sought  and verified  all  the  information  it  considered  necessary 

and carried out investigations at the premises of the following companies: 

(a) producer/exporter in Japan 

- Rubycon Corporation, Tokyo and Ina. 

(b) importer related to the producer/exporter 

- Rubycon UK, South Ruislip, United Kingdom. 

(c) importer not related to the producer/exporter 

- Codico Gesellschaft m.b.H. &Co KG, Vienna, Austria (hereinafter Codico). 

During the on-spot  verification  at the premises  of Codico,  it became  apparent that 

the company  had provided  misleading information.  In particular,  the  company  had 

not  reported  a significant  number  of  its import  transactions.  This  and  some  other 

deficiencies  did  cast  a  serious  overall  doubt  on  the  reliability  of  the  information 

provided  by  the  company.  Consequently,  the  Commission  decided  to  base  its 

findings for  this  company  on  facts  available  in  accordance  with  Article  18  of  the 

Basic Regulation and informed the company  accordingly. 

An investigation  at the premises of the other importer were  not  deemed  necessary 

due  to  the  relatively  insignificant  importance  of  its  total  import  transactions 

relating to LAECs produced by Rubycon. 

(8) 

Owing  to  the  volume  and the  complexity  of the  data  gathered  and  examined,  the 

investigation  exceeded  the normal time period of  12 months foreseen  in Article  11 

(5) of the Basic Regulation. 

(9) 

Parties  were  informed  in  writing  of  the  essential  facts  and  considerations  on  the 

basis  of  which  it  was  intended  to  amend  Regulation  (EEC)  No  3482/92.  The 

comments  presented  by  the  parties  were  considered  and,  where  appropriate,  the 

findings  were modified to take account of them. 

B. 

PRODUCT CONCERNED 

(10)  The product  subject  to  the definitive  anti-dumping  duty  referred  to  in recital  1 is 

large electrical  capacitors, aluminium electrolytic, with a CV product  (capacitance 

multiplied by rated voltage) between  18 000 and 310 000 pic (micro-coulombs), at 

a voltage of  160 V or more and with a diameter of 19 mm or more and at a length 

of 20 mm or more. The product is classifiable under CN code ex 8532 22 00. 

For  the  purpose  of  this  review  investigation  which  concerned  only  one  of  the 

known  Japanese  producers/exporters  and  which  was  limited  to  aspects  of 

dumping, it was not considered appropriate to extend the like product definition  as 

it  was  done  -  due  to  technical  developments  of  the  product  concerned  -  in  the 

investigation  relating  to  imports  of LAECs  originating  in the  Republic  of  Korea 
and Taiwan (4). 

4  Régulation  (EC)  No  1384/94,  OJ  NG  L  152,  18.  6.  1994,  p.  1,  confirming  Regulation  (EC)  No 

371/94, Oi No L 48,  19. 2.  1994, p. 10. 

6 

C. 

DUMPING 

1. 

Preliminary remark 

(11) 

In the initial  investigation  the dumping margin was calculated  on the  basis  of the 

best  selling  models  which  accounted  for  more  than  70%  of  the  exporter's  total 

transactions to the Community.  Consequently, the calculation in this investigation 

was also based on best selling models accounting for more than 70% of the export 

volume. 

In  their  comments  to  the  respective  disclosure  letters,  Rubycon  and  FARAD 

claimed  that  it  would  have  been  more  appropriate  to  use  a  different  set  of 

transactions. In particular, Rubycon claimed that - instead of relying on quantities -

70% of the export  turnover  should have been used, whereas FARAD proposed  to 

use  a  completely  different  set  of  transactions  in  order  to  avoid  the  risk  that  the 

exporter only increases its export prices for certain best-selling models. 

The Council noted, however, that the Commission was neither provided with, nor 

did it otherwise receive information  indicating a "change of circumstances" in the 

sense of Article  11 (9) of the Basic Regulation which would  suggest that a change 

in methodology for the determination of the export prices is warranted.  Therefore, 

it was considered appropriate - as in the initial investigation - to rely on the models 

accounting for 70% of Rubycon's export volume. 

2. 

Normal Value 

(12)  As regards the determination  of the normal value, two types of best selling models 

have been distinguished. 

For models which were sold in sufficient  quantities and in the ordinary  course  of 

trade  during  the  investigation  period  on  the  Japanese  domestic  market,  normal 

values  were  based  on  the  (profitable)  domestic  sales  prices  in  accordance  with 

Article 2 (2) and (4) of the Basic Regulation. 

(13)  For  all  other  models,  for  which  no  or  insufficient  domestic  sales  in the  ordinary 

course  of  trade  were  made  during  the  investigation  period,  normal  values  were 

constructed  in  accordance  with  Article  2  (3)  of  the  Basic  Regulation. 

In  this 

respect,  normal  values  were  calculated  by  adding  up  cost  of  manufacturing, 

domestic SGA expenses and a reasonable amount of profit,  calculated  on the basis 

of  the  weighted  average  profit  margin  of  Rubycon  achieved  on  its  profitable 

domestic  sales  of LAECs.  The cost  of manufacturing  reported  by Rubycon  was 

corrected  since it appeared that the company had not provided the actual purchase 

price  for  a  certain  part  used  in  the  production  of  LAECs  which  was  subject  to 

outside processing. 

3. 

Export prices 

(14)  As regards the determination  of the export price, a distinction was made between 

sales to related and unrelated parties in the Community. 

In accordance with Article 2 (8) of the Basic Regulation,  export prices of sales to 

unrelated  companies were  determined  on the basis of prices actually  paid  for  the 

products sold for export to the Community. 

(15) 

In  the  case  of  export  sales  to  Rubycon  UK,  the  related  importer,  export  prices 

were constructed  on the basis of resale prices to  the first independent  purchaser, 

duly adjusted  to take account  of all actual costs incurred between importation and 

resale. In addition,  an adjustment  was made for  a profit  margin  of 5% which was 

considered a reasonable percentage and which is the same as that used in the initial 

investigation in conformity with Article 11 (9) of the Basic Regulation.  As for the 

profit  margin,  it was noted  that  data received from the two  importers  that  made 

themselves  known  in  this  investigation  could  not  be  used  since  one  is  a  non-

cooperating party whereas the other does not resell the product concerned. 

(16)  Anti-dumping duties paid upon importation were deducted  as a cost in accordance 

with Article 2  (9)  of the Basic Regulation when  constructing  the  ex works  export 

prices  since  no  conclusive  evidence  pursuant  to  Article  11  (10)  of  the  Basic 

Regulation was  provided  in the  course  of the investigation  showing  that  the anti 

dumping duties are duly reflected  in the subsequent  selling prices of the  customers 

of Rubycon UK in the Community. 

(17)  Finally, it was noted that part of Rubycon's products were sold to customers in the 

Community  producing  under the regime of inward  processing  relief.  These  export 

transactions  under  inward  processing  relief  were  taken  into  account  in  the 

calculation of Rubycon's export price.  Rubycon contested this approach. 

In this respect,  it  was  considered  that the  exporter  does  not  necessarily  know  for 

all  transactions  whether  their  customers  release  the  models  under  inward 

processing  relief  into  free  circulation  at  a  later  stage  or  whether  finished  goods 

containing Rubycon's LAECs are reimported into the Community at a later stage. 

10 

In  addition,  sales  of LAECs  to  companies  using the  inward  processing  relief may 

well  contribute  to  the  injury  caused  to  Community  producers  as  they  reduce 

outlets which could  otherwise be available to them. This is not  contradicted  by the 

requirements  of  Article  552  of  Commission  Regulation  (EEC)  No  2454/93  (5) 

containing  provisions  operating  the  inward  processing  authorisation  according  to 

the  Community  Customs  Code.  In  particular,  it  was  found  that  the  "economic 

conditions"  to  be  fulfilled  when  granting  the  authorisation  to  operate  under  in 

ward-processing  relief  can  -  in  a  significant  number  of  instances  -  be  satisfied 

without (in depth) verification  of whether comparable goods are actually produced 

in the  Community.  In this  respect  it was  also  noted  that Rubycon  had  -  despite  a 

request  from  the  Commission  -  not  provided  sufficient  information  showing  why 

Rubycon or its customers had received the respective authorisation.  Consequently, 

it cannot be excluded that in the present case Community producers were deprived 

of sales opportunities otherwise available to them. 

Finally,  it  was  noted  that  the  inclusion  of  export  transactions  relating  to  inward 

processing  is  in line with the Basic Regulation which  provides  in its  Article  1 (2) 

that  a  product  is  considered  as  being  dumped  "if  its  export  price 

to  the 

Community"  (as  opposed  to  its  release  into  free  circulation  in  the  Community, 

emphasis added) is less than its normal value. 

Consequently,  the  Council  concluded  that  the  inclusion  of  export  transactions 

relating to inward processing relief is justified for this investigation. 

5 

OJ No L 253, 11. 10. 1993, p. 1, as last amended by Regulation (EC) No 1427/97, OJ No L 196, 24. 
7. 1997, p.  31. 

11 

4. 

Comparison 

(18)  Normal values were compared with export prices at an ex-factory level.  As far as 

differences in conditions and terms of sale are concerned, allowances were granted 

in accordance with Article 2 (10) of the Basic Regulation for delivery and payment 

terms. 

(19)  Claims for adjustments for  salesmen's  salaries and advertising costs could not be 

granted since it was not demonstrated that price comparability of normal value and 

export price was affected. 

5. 

Dumping Margin 

(20)  The comparison of weighted average normal values with weighted average export 

prices showed the existence of dumping.  Expressed as a percentage of the  free-at-

Community-frontier price, the weighted average dumping margin amounted to: 

Rubycon 

4.2% 

12 

D. 

NEW LEVEL OF DUTY 

(21 )  The dumping  margin  established  in the present  review is lower  than  the  dumping 

margin  found  in the  initial  investigation,  which  formed  the basis  of the  duty  rate. 

Since  no  clear  indications  were  received  or  found  showing  that  dumping  would 

recur  at  a higher  level  once the review  has been finalised, the  Council  concludes 

that  Regulation  (EEC)  No  3482/92  should  be  amended  in  respect  of  Rubycon 

Corporation, Ina Nagano. The new duty rates amounts to 4.2 %. 

(22)  This  review  does  not  affect  the  date  on  which  Regulation  (EEC)  No  3482/92 

expires, pursuant to Article 11 (2) of the Basic Regulation. 

HAS ADOPTED THIS REGULATION: 

13 

Article 1 

Article 1  (2) of Regulation (EEC) No 3482/02 is hereby amended as follows : 

The figure in the rate of duty column of "30.1 %" relating to Rubycon Corporation, Ina 

Nagano, shall be replaced by "4.2 %". 

Article 2 

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

OfficialJournal of the European Communities. 

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

States. 

Done at Brussels 

For the Council 
The President 

14 

ISSN 0254-1475 

COM(97) 697 final 

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