Council Regulation (EC) No 905/98 of 27 April 1998 amending Regulation (EC) No 384/96 on protection against dumped imports from countries not members of the European Community
Date: 1998-04-27
Institutions: Council of the European Union
Subjects: anti-dumping duty, anti-dumping legislation, common commercial policy, dumping, import, third country

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Official Journal of the European Communities

30. 4. 98

COUNCIL REGULATION (EC) No 905/98

of 27 April 1998

amending Regulation (EC) No 384/96 on protection against dumped imports
from countries not members of the European Community

THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty establishing the European
Community, and in particular Article 113 thereof,

Having regard to the proposal from the Commission,

Whereas by Regulation (EC) No 384/96 (1)
(hereafter
referred to as ‘the Basic Anti-dumping Regulation’) the
Council has adopted common rules for protection against
dumped imports from countries which are not members
of the European Community;

Whereas by Regulation (EC) No 519/94 (2) the Council
has adopted common rules for imports for certain third
countries which are listed in Annex I thereto;

in the case of

Whereas Article 2(7) of Regulation (EC) No 384/96 lays
imports from non-market
down that,
economy countries and, in particular those countries to
which Regulation (EC) No 519/94 applies, normal value
shall be determined on the basis of
the price or
constructed value in an analogue market economy third
country;

Whereas the process of reform in Russia and the People’s
Republic of China has fundamentally altered their eco-
nomies and has led to the emergence of firms for which
market economy conditions prevail; whereas both coun-
tries have as a result moved away from the economic
circumstances which inspired the use of the analogue
country method;

Whereas it
is appropriate to revise the Community’s
anti-dumping practice in order to be able to take account
of the changed economic conditions in Russia and in the
People’s Republic of China; whereas, in particular, it is
appropriate to specify that normal value may be deter-
mined in accordance with the rules applicable to market
economy countries in cases where it can be shown that
for one or more producers
market conditions prevail
subject to investigation in relation to the manufacture and
sale of the product concerned;

Whereas it is appropriate to specify that an examination
of whether market conditions prevail will be carried out
on the basis of properly substantiated claims by one or
more producers subject to investigation who wish to avail
themselves of the possibility to have normal value deter-

(1) OJ L 56, 6. 3. 1996, p. 1. Regulation as amended by Regula-

tion (EC) No 2331/96 (OJ L 317, 6. 12. 1996, p. 1).

(2) OJ L 67, 10. 3. 1994, p. 89. Regulation as last amended by Re-
gulation (EC) No 847/97 (OJ L 122, 14. 5. 1997, p. 1).

mined on the basis of rules applicable to market economy
countries;

in order

Whereas,
to introduce the revised practice
without affecting the common rules for imports in respect
of Russia and the People’s Republic of China, it is appro-
priate to remove form Article 2(7) of the Basic Anti-
dumping Regulation the reference to the list of countries
attached to Regulation (EC) No 519/94, and to add
instead, in a footnote, the revised list of the countries
concerned,

HAS ADOPTED THIS REGULATION:

Article 1

Article 2(7) of Regulation (EC) No 384/96 shall be
replaced by the following:

‘7.

(a) In the case of

from non-market
imports
economy countries (*), normal value shall be
determined on the basis of
the price or
constructed value in a market economy third
country, or the price from such a third country
to other countries, including the Community,
or where those are not possible, on any other
reasonable basis, including the price actually
paid or payable in the Community for the like
product, duly adjusted if necessary to include a
reasonable profit margin.

An appropriate market economy third country
shall be selected in a not unreasonable manner,
due account being taken of any reliable infor-
mation made available at the time of selection.
Account shall also be taken of
time limits;
where appropriate, a market economy third
country which is subject to the same investiga-
tion shall be used.

to the investigation shall be
The parties
the
informed shortly after
market economy third country envisaged and
shall be given 10 days to comment.

initiation of

its

(b) In anti-dumping investigations

concerning
imports from the Russian Federation and the
People’s Republic of China, normal value will
be determined in accordance with paragraphs 1
to 6, if it is shown, on the basis of properly
substantiated claims by one or more producers
subject to the investigation and in accordance
with the criteria and procedures set out
in
subparagraph (c) that market economy condi-
tions prevail for this producer or producers in

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respect of the manufacture and sale of the like
product concerned. When this is not the case,
the rules set out under subparagraph (a) shall
apply.

(c) A claim under subparagraph (b) must be made
in writing and contain sufficient evidence that
the producer operates under market economy
conditions, that is if:

firms regarding prices, costs
— decisions of
instance raw
including for
and inputs,
materials, cost of
technology and labour,
output, sales and investment, are made in
response to market signals reflecting supply
and demand, and without significant State
interference in this regard, and costs of
major
inputs substantially reflect market
values,

— firms have one clear set of basic accounting
records which are independently audited in
line with international accounting standards
and are applied for all purposes,

— the production costs and financial situation
of firms are not subject to significant distor-
tions carried over from the former non-
market economy system,
in particular in
relation to depreciation of assets, other

write-offs, barter
compensation of debts,

trade and payment via

— the firms concerned are subject to bank-
ruptcy and property laws which guarantee
legal certainty and stability for the opera-
tion of firms, and

— exchange rate conversions are carried out at

the market rate.

A determination whether the producer meets
the abovementioned criteria shall be made
within three months of the initiation of the
investigation, after specific consultation of the
Advisory Committee and after the Community
industry has been given an opportunity to
comment. This determination shall remain in
force throughout the investigation.

(*) Including Albania, Armenia, Azerbaijan, Belarus,
Georgia, Kazakhstan, North Korea, Kyrgyzstan,
Moldavia, Mongolia, Tajikistan, Turkmenistan,
Ukraine, Uzbekistan, Vietnam.’

Article 2

This Regulation shall enter into force on 1 July 1998.

It shall apply to all anti-dumping investigations initiated
after the date of its entry into force.

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

Done at Luxembourg, 27 April 1998.

For the Council

The President

R. COOK