Proposal for a Council Regulation (EC) imposing a definitive anti-dumping duty on imports of certain unbleached cotton fabrics originating in the People's Republic of China, Egypt, India, Indonesia and Pakistan, definitively collecting the provisional duty imposed and terminating the anti-dumping proceeding in respect of imports of these fabrics originating in Turkey
Date: 1998-07-29
Institutions: European Commission
Subjects: anti-dumping duty, anti-dumping legislation, import, textile product, third country

COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 29.07.1998 
COM(1998) 487 final 

Proposal for a 

COUNCIL REGULATION (EC) 

imposing a definitive anti-dumping duty on imports of certain unbleached cotton 

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

Pakistan, definitively  collecting the provisional duty imposed and terminating the 

anti-dumping proceeding in respect of imports of these fabrics originating in 

Turkey 

(presented by the Commission) 

EXPLANATORY MEMORANDUM 

Subject:  Anti-dumping  proceeding  concerning  imports  of  unbleached  cotton 
fabrics originating in the People's Republic of China, India, Indonesia, 
Pakistan, Egypt and Turkey 

Proposal for definitive measures 

(1) The Commission, by Regulation (EC) No 773/98 imposed provisional anti-dumping 
duties  on  imports  into  the  Community  of  certain  unbleached  cotton  fabrics 
originating in the above-mentioned countries. 

(2) Subsequent to the imposition  of the provisional  anti-dumping  duties, the interested 
parties  who  so  requested  were  granted  an  opportunity  to  be  heard  and  to  submit 
observations in writing. 

(3) The Commission's  services have considered  all the arguments and they have taken 

them into account where appropriate. 

(4) The  further  investigation  has  established  that  the  imports  originating  in  Turkey 
should  not  be  cumulatively  assessed  with  the  imports  from  the  other  countries 
concerned. This conclusion has been reached in view of differences  in the conditions 
of competition between imports from Turkey and those of the other five countries, i.e. 
continuous decline in the volume of imports, low price undercutting  and a share of 
total  imports from third  countries  that  in the  12-months before  the  opening  of the 
investigation was below the 3% threshold established in Article 5.8 of the WTO Anti 
dumping  Agreement,  which  would  require  the  immediate  termination  of  a 
proceeding. 

Furthermore,  when  taken  in  isolation,  it  was  found  that  these  imports  do  not 
contribute  in  any  material  way  to  the  injury  suffered  by  the  Community  industry. 
Therefore,  it  is  proposed  that  the  proceeding  concerning  imports  of  the  product 
concerned originating in Turkey be terminated. 

(5) With  respect  to  the  imports  originating  in  the  other  five  countries  concerned,  the 
provisional  findings  regarding  the  existence  of  injurious  dumping  and  the 
Community interest aspects were confirmed. 

(6) The  Commission's  services  suggested  undertakings  to  the  exporters  from  the 

countries concerned. 

•  These  undertakings  would  apply  to  a  limited  number  of  constructions  (i.e. 
models), which represent the bulk of the imports from each of the five countries 
concerned (around 50%). 

y 

•  The undertaking would consist in minimum prices based on the average import 
prices,  increased  by  the  dumping/injury  margins  of  the  sampled  exporters, as 
appropriate. 

•i CK 

•  In  order  to  avoid  circumvention  through  constructions  not  covered  by  the 
undertaking,  a country-wide  quantitative  ceiling  would  be  set per construction. 
Once this quantitative ceiling reached, the applicable ad valorem duty will enter 
into force. 

•  Within  the  undertaking,  for  unbleached  fabrics  weighing  less  than  100  gr./m2, 
which  represent  a  small  percentage  of  total  imports  (around  5%),  a  specific 
minimum  price  would  be  established,  without  a  quantitative  ceiling.  Those 
fabrics  represent  a marginal  segments  of the market and enjoy  specific  product 
characteristics. 

•  The  undertakings  signed  by  exporters  would  be  underpinned  by  agreements 
concluded with the associations/authorities in the countries concerned in order to 
assist to monitor the prices and quantities specified in the undertakings. 

•  Monitoring:  the  classical  monitoring  (i.e.  reporting  by  the  exporters)  will  be 
reinforced  by  the  SIGL,  an  on-line  computer  program  which  is  used  by  the 
Commission  in  co-ordination  with  national  agencies  to  manage  the  existing 
textile quotas. 

(7) Discussion are currently being held with the exporters concerned which are likely to 
continue  until  the month of  September.  Should the undertakings be accepted by the 
Commission, this shall be reported to the Council  and will be an integral part of the 
definitive solution of this case. 

(8) For the rest of the fabrics, for exporters not signing the undertakings and for the best-
selling  constructions  exceeding  the  quantitative  ceilings,  it  is  proposed  to  adopt ad 
valorem  anti-dumping  duties,  as  a  complement  to  the  system  of  undertakings  as 
described above. 

(9)  On  this  basis,  it  is  proposed  that  the  Council  adopts  the  attached  proposal  for  a 
Council  Regulation  to  impose  definitive  anti-dumping  duties  on  imports  of 
unbleached  cotton  fabrics  originating  in  the  People's  Republic  of  China,  India, 
Indonesia, Pakistan and Egypt and to terminate the proceeding as concerns Turkey. 

1b 

Commission Declaration to the minutes of the Council 

In  the  framework  of  the  present  investigation,  the  Commission  has  come  to  the 

conclusion that the proceeding should be terminated as regards imports of unbleached 

cotton fabrics originating in Turkey. This decision was taken, inter alia, in view of the 

low  and  declining  volume  of  imports  from  Turkey  and  its  low  share  of  the 

Community market. 

Should these trends be reversed in the coming years, and should a duly substantiated 

complaint  be lQdged by the Community  industry, showing the existence of  injurious 

dumping  of  imports  from  Turkey,  the  Commission  will  expeditiously  examine  this 

complaint. 

ic 

Proposal for a 

COUNCIL REGULATION (EC) NO 

/98 

imposing a definitive anti-dumping duty on imports of certain unbleached cotton 

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

Pakistan, definitively collecting the provisional duty imposed and terminating the 

anti-dumping proceeding in respect of imports of these fabrics originating in 

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, as amended by Regulation (EC) No 2331/96 2 and by Regulation (EC) No 
905/983, and in particular Articles 8,9 and 10(2) thereof, 

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

Advisory Committee, 

Whereas: 

A. PROVISIONAL MEASURES 

(1) By  Regulation  (EC)  No  773/98  (hereinafter  referred  to  as  the  "provisional  duty 

Regulation")  the  Commission  imposed  provisional  anti-dumping  duties  on  imports 

into the Community of certain unbleached cotton fabrics  originating  in the People's 

1  OJ No L 56, 6.3.1996, p. 1. 

2  OJNoL  317, 6.12.1996, p.l. 

3  OJ No L  128, 30.04.1998, p. 18. 

1  cL 

Republic  of  China  (hereinafter  referred  to  as  "the  PRC"),  Egypt,  India, Indonesia, 

Pakistan and Turkey. 

B. SUBSEQUENT PROCEDURE 

(2) Subsequent  to  the  imposition  of  provisional  anti-dumping  duties,  the  interested 

parties  who  so  requested  were  granted  an  opportunity  to  be  heard  by  the 

Commission's  services.  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,  at  the  level  of  these 

duties, of amounts secures by way of provisional  duties. They were also granted a 

period within which to make representations subsequent to this disclosure. 

(3) The oral and written comments submitted by the interested parties were analysed and, 

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

(4) Some producers/exporters have argued that the opening of the proceeding is illegal, 

since  the  publication  took  place  46  days  after  the  lodging  of  the  complaint,  thus 

contravening Article 5(9) of Regulation (EC) No 384/96 (hereinafter referred to as the 

"basic Regulation"). 

(5) The objective of the time limit of the 45 days is to give the complaining Community 

industry the benefit  of an expeditious examination  of its complaint and, should the 

necessary  requirements  be  fulfilled,  for  the  Commission  to  initiate  a  proceeding 

without undue delay. In this respect it would not appear that any interested party is 

prejudiced by the initiation one day later than the 45 days time limit. The Community 

industry has not objected about the date of initiation of the proceeding. 

(6) Some  producers/exporters  have  further  argued  that  the  opening  of  the  proceeding 

contravened the principle non bis in idem, since a former  proceeding concerning the 
same product had not been formally closed.4 

This  proceeding  was  opened  by  a Notice  of  Initiation  published  in  the  OJ No  C50, 21.02.1996. 
Provisional anti-dumping duties were imposed by Commission Regulation (EC) No 2208/96, OJ No L 
295, 20.11.1996, p.3. 

(7) In  the  former  proceeding,  the  Council  declined  to  adopt  the  proposal  of  the 

Commission  to  impose  definitive  measures within the  statutory  time  limits, i.e.  15 

months from the initiation of the proceeding, without setting out formal  reasons for 

this refusal. 

(8) In this  respect,  firstly  and  by comparison  to the previous  proceeding,  it  should  be 

noted  that  in  the  current  proceeding,  the  investigation  relates  to  economic  data 

stemming from  a different  investigation period and to a product concerned which is 

somewhat different  from that covered by the past proceeding. This as such precludes 

any possible contravention against the principle non bis in idem.  Secondly, according 

to Article 5(9) of the basic Regulation, if there is sufficient prima facie  evidence of 

injurious dumping to justify  initiating a proceeding, the Commission is obliged to do 

so. Since this was the case in the present proceeding, the Commission opened a new 

investigation. Thirdly, Article 6(9) provides that an investigation shall be concluded 

within  15 months  of  initiation.  While  no  mechanism  is provided  for  by  the  basic 

Regulation  for  the formal  termination of a proceeding, once this period  has passed 

without  imposition  of  measures,  since  no  measures  can  thereafter  be  imposed,  a 

proceeding must in such circumstances be deemed to be terminated by operation of 

law. 

For these reasons, the above argument concerning the illegality of the proceeding has 

to be rejected. 

(9) Some  parties  have  argued  that  the  Commission  has  failed  to  demonstrate  the 

existence of a clear  separation between the captive and the non-captive  market and 

that,  therefore,  the  representativity  of the  Community  industry  and  the  analysis  of 

injury should relate to both the captive and the non-captive market. 

Furthermore, some parties have argued that even if such a clear separation existed, the 

standing  of  the  complainants  should  always  be  assessed  by  reference  to  the 

Community production destined for both the non-captive and the captive market. 

(10)The  Commission  further  examined  both  markets  in  the  light  of  the  evidence 

submitted  by  all  interested  parties.  The  analysis  has  focused  on  the  interrelations 

between  sales  of  unbleached  cotton  fabrics  from  downstream  integrated  weavers 

(captive  weavers)  operating  in  the  captive  market,  from  non-captive  weavers  and 

imported fabrics. 

(ll)Regardless  of  the  producers, unbleached  cotton fabrics  are an intermediate  product 

subject  to  further  manufacturing  steps.  The  structure  of  the  textile  industry  is  such 

that the unbleached fabrics are either produced by a downstream integrated company 

which  after  weaving finishes the  fabrics  without  putting them on  sale,  or they  are 

produced by non-integrated weavers and sold on the non-captive market. 

(12)The  investigation  has  shown  that,  based  on  the  situation  of  the  complainant 

Community producers, around 92% of the unbleached cotton fabrics sold on the non-

captive  market  are  produced  by  non-integrated  weavers.  These  weavers  operate 

exclusively  in  the  non-captive  market.  An  additional  3% of  the  sales  in  the  non-

captive market is produced by a company which belongs to a group that is active in 

the  downstream  markets  (finishing  and  making-up).  However,  this  company  acts 

independently  in the  non-captive  market  and not  in the  captive  market.  It has  also 

been found that the complainant Community producers represent around 90% of total 

non-captive  Community  production.  Furthermore,  no  information  is  available  that 

could  indicate  that  the  situation  for  the  non-complainant  non-integrated  producers 

differs  from  the  one  of  the  complainant  industry.  In view  of  the  above  mentioned 

considerations,  it  can  be  estimated  that  not  more  than  around  5%  of  total  non-

integrated  Community  production  of  unbleached  cotton  fabrics  is  sold  in  the  non-

captive  market  by  downstream  integrated  producers  who  mainly  operate  in  and 

produce  for  the  captive  market.  This  limited  amount  is  generally  accounted  for  by 

remnants of fabrics initially produced to be transformed in their downstream activity 

and is therefore not representative of the main activity of these companies. 

(13)In this respect it is also worth nothing that unbleached cotton fabrics  in the  captive 

market  are  generally  sold  at  transfer  prices  within  the  company,  excluding  a 

profitability element. In addition, a number of these integrated companies do not even 

have  a  separate  corporate  structure  for  the  company  divisions  carrying  out  the 

different  activities,  but  are  divided  into  departments  within  the  same  company.  A 

price difference between markets is not sufficient to change the source of supply. 

(14)As to the  sales of unbleached  fabrics  from  the sampled  Community producers in the 

non-captive  market,  these  have  been  found  to  be  generally  destined  for  finishers, 

converters and/or makers-up. 

(15)Furthermore, the cooperating producers/exporters have been found to export the great 

majority  of  their  fabrics  through  importers  and  traders  in  the  Community  and  not 

directly to integrated weavers. 

(16)In  view  of  the  above  mentioned  it  is  concluded  that  fabrics  produced  by  the 

complaining  Community  producers  and  sold  on  the  non-captive  market  are  not 

generally  in  competition  with  fabrics  produced  and  transformed  internally  by 

downstream  integrated  weavers.  Since  a  clear  separation  exists  between  the  captive 

and  the  non-captive  market,  and  since the  captive  market  is not  directly  supplied  to 

any  significant  extent  by  the  imports  concerned,  the  assessment  of  injury  to  the 

Community  industry  has  been  carried  out  by  reference  to  the  non-captive  market 

only. 

(17)Furthermore,  since  the  analysis  of  injury  relates  to  the  Community  industry  as 

defined  according to Article 4(1) of the basic Regulation, and since Article 4(1)  refers 

to  Article  5(4) which  establishes  the  rules  on  standing, the requirements  of  standing 

should  also  be  assessed  by  reference  to  the  production  of  the  non-integrated 

producers. 

Even  if  the  standing  of  the  complainants  were  to  be  assessed  with  reference  to  the 

total Community production,  i.e. that destined for the captive and for the  non-captive 

market,  the  complainant  Community  producers  still  represent  more than  the  25% of 

total  Community  production,  thus  fulfilling  the  requirements  of  Article  5(4)  of  the 

basic Regulation. 

(18) Therefore, the above arguments had to be rejected. 

C. PRODUCT UNDER CONSIDERATION  AND LIKE PRODUCT 

1. 

Request for exclusions from the product under consideration 

(19)In  the  provisional  duty  Regulation,  it  was  provisionally  decided  to  exclude  grey 

handloom  fabrics  from  the scope of the proceeding  and to exempt those  fabrics from 

the  payment  of the duties  if accompanied  by  a certificate  of handloom  origin  issued 

by  the  appropriate  authorities  of  the  exporting  countries.  In  view  of  the  absence  of 

substantiated  comments  against  the  exclusion  of  handloom  fabrics,  the  provisional 

findings  are hereby  confirmed. 

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

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

the proceeding. 

(a) Fabrics for  industrial applications (industrial fabrics) 

(21)One exporter claimed that industrial fabrics  should be excluded from the scope of the 

proceeding, since they had different  physical  characteristics  as compared to the other 

unbleached  cotton fabrics.  These differences  allegedly  rendered  the  industrial  fabrics 

unsuitable for applications other than industrial ones. The different  characteristics and 

uses allegedly  resulted  in a different  consumer  perception.  The  distribution  channels 

were  alleged  to  be  different,  and  it  was  furthermore  claimed  that  there  was  no 

Community production of those fabrics. 

It has been found that fabrics for industrial applications are produced in a wide variety 

of  constructions,  widths,  qualities  and  weight,  depending  on  their  intended  use. No 

clear  dividing  line  was  found  between  industrial  fabrics  and  other  fabrics.  Even  if 

some  of the constructions of industrial  fabrics  are only  used  for  certain  applications, 

the general physical characteristics of the fabrics, overall, remain the same as those of 

fabrics  for  other uses (e.g. furniture).  The  distributors  of  industrial  fabrics  also trade 

in fabrics  for other uses and applications. The exclusion of industrial  fabrics  from  the 

scope of the proceeding cannot, therefore, be accepted. 

(b)  Stretch fabrics 

(22)One exporter repeated the request  for  exclusion  of stretch unbleached  cotton  fabrics. 

These  are  fabrics  woven  with  a  yarn  incorporating  an  elastic  filament  that  gives 

elasticity  to  the  woven  fabric.  The  exporter  claimed  that  those  fabrics  are  produced 

with  different  production  methods, that  they  were  sold  at  relatively  high  prices  and 

that  they  had  a  different  consumer  perception,  since the  end-use  of the  fabric  was 

limited to clothing. 

The Commission  found  that stretch fabrics  are manufactured  according to the same 

production  methods used to manufacture  the other fabrics  concerned.  In any event, 

neither differences  in production methods nor a different  pricing policy are elements 

that determine per  se the existence of a different  product.  Furthermore,  it has been 

found  that  despite  the  differences  between  stretch  fabrics  and  non-stretch  fabrics 

which are the result  of the use of elastic yarn, the essential  physical  characteristics 

and  uses  remain  the  same  as  those  of  other  unbleached  cotton  fabrics  concerned. 

Furthermore, the consumer perception of those fabrics remain basically the same as in 

other unbleached  cotton fabrics. Therefore, the exclusion of stretch fabrics from the 

scope of this proceeding cannot be granted. 

(c)  Unbleached cotton fabric  used for  embroidery and fabrics  weighing  under 

100gr/m2 

(23)As  announced  in  the  provisional  duty  Regulation,  the  Commission  further 

investigated the issue of fabrics used for  embroidery  and those weighing under  100 
gr/m2. In this respect, it is concluded that since their.essential physical characteristics 

and uses remain similar to those of the other fabrics concerned, no exclusion from the 

scope of the proceeding can be granted. 

2. 

Like product 

(24)Some  parties  have  argued  that  unbleached  cotton  fabrics  manufactured  in  the 

Community  are not  like products to imported unbleached  cotton fabrics,  in view of 

the differences  in production methods, quality and constructions. 

Firstly, it is the practice of the Community  institutions, to consider that quality and 

production  methods  are  not  elements  that  determine  the  existence  of  a  different 

product.  Indeed,  the  determination  of  a  like  product  is  based  on  the  essential 

chemical,  technical  and/or  physical  characteristics,  the  use  or  functions  and  the 

consumer's  perception  of  the  product.  In  the  current  case,  the  differences  in 

production methods and quality do not detract from the validity the observation that 

imported  unbleached  cotton  fabrics  are  interchangeable  with  Community  produced 

ones. 

As  to  differences  in  constructions,  it  should  be  noted  that  cotton  fabric  is 

manufactured  in a  great  variety  of  constructions, defined  by  a combination  of two 

pairs of numbers (count of yarn in warp and weft and number of threads in warp and 

weft).  The  constructions  manufactured  in  the  Community  by  the  complainant 

Community producers closely resemble the imported constructions, thus fulfilling  the 

requirements of Article 1(4) of the basic Regulation. Indeed, the producers/exporters 

concentrate  on  a  limited  number  of  constructions  representing  the  bulk  of  their 

exports and export smaller quantities of many other constructions. It is worth noting 

that  both  the  best  selling  constructions  and  the  rest  of  the  constructions  are  not 

necessarily the same for the different  countries concerned. 

Furthermore,  the  investigation  has  shown  that  there  is  a  high  degree  of 

interchangeability  between  adjacent  constructions  which  are  manufactured  by  the 

Community industry. For these reasons, the argument cannot be accepted. 

(25)The provisional conclusions reached by the Commission on this point are therefore 

confirmed. 

(a)  General 

D. 

DUMPING 

1. 

Indonesia 

(26)The four companies selected in the sample were found to have provided  information 

which did not satisfy  the Commission at the provisional  stage. However, comments 

made following disclosure of the provisional findings led the Commission to consider 

that  although  the  information  submitted  by  these  companies  was  not  ideal  in  all 

respects, it should nevertheless not be disregarded  for  three out of four  companies, 

since the  deficiencies  were not  such that  no reasonably  accurate  findings  could  be 

reached at the definitive  stage. Only PT Daya Manunggal did not come forward with 

sufficient  explanations,  leaving 

too  much  of  the  information  received  from  that 

company unsatisfactory.  Consequently, the findings for this company continue to be 

based  on  facts  available,  in  accordance  with  Article  18 of  the  basic  Regulation,  as 

described in more detail in recital (68) of the provisional duty Regulation. 

(b)  Allowance for  domestic credit costs 

(27)For the provisional determinations, the domestic allowance for credit costs was based 

on  the  interest  rates  mentioned  in  the  audited  accounts  rather  than  the  percentage 

presented by the companies concerned. 

(28)Two  companies  claimed  that the  interest  rates  on  short-term  loans mentioned  in the 

audited accounts are not appropriate since credit costs are an opportunity  cost and not 

a  real  cost  and  that  accordingly  the  interest  rates  indicated  in  the  questionnaire 

responses should be applied. 

The claim was rejected  as an adjustment  for  credit costs could only be granted  at the 

level of the normal bank rates applicable during the investigation period. The interest 

rates  mentioned  in  the  audited  accounts  were  considered  to  be  a  reliable  source  to 

establish the market rate prevailing during the investigation period. 

c) 

Cost of manufacturing 

(29)In the case of one company, manufacturing  costs were allocated  for raw materials  at 

the provisional stage on an average cost basis. 

The  company  expressed  its  concerns  about  the  allocation  of  raw  material  costs  and 

provided  satisfactory  explanations  for  its claim. The  allocation  of raw material  costs 

was amended accordingly for definitive  determinations. 

(d)  Dumping margins 

(30)Concerning the companies  forming  part  of the same group, the methodology  set  out 

in  recitals  (44)  and  (45)  of  the  provisional  duty  Regulation  was  used.  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: 

•  Group Argo Pantes (P.T. Argo Pantes+ P.T. Daya Manunggal): 

13.7% 

•  P.T. Apac: 

•  P.T. Eratex Djaja: 

11.8% 

12.7% 

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

investigated  was  based  on  the  weighted  aVerage  of  the  sample.  Expressed  as  a 

percentage of the CIF import price at the Community border, the margin is 

12.2%. 

It  should  be  noted  that  the  level  of  cooperation  of  Indonesian  companies  was  very 

high  (the  cooperating • exporters  accounted  for  practically  100%  of  exports  to  the 

Community  during the investigation  period). Furthermore, the cotton  fabric  sector  is 

of  an  unusually  dynamic  character  which  makes  it  very  likely  that  there  will  be  in 

future  a continuous and substantial number of new exporters. It was therefore  decided 

to depart  from  the approach  outlined  in the provisional  duty  Regulation  according  to 

which  the  residual  dumping  margin  was  set  at  the  level  of  the  highest  dumping 

margin found. Instead, the residual dumping margin was established at  the same level 

as for cooperating companies not in the sample, i.e. at 

12.2% 

2. 

Turkey 

(a)  General 

(31) It  was  found  at  a provisional  stage that  one  of  the  selected  companies,  Sôktas, did 

not  fully  cooperate  in  the  proceeding,  because  the  conversion  factor  used  for 

determining  the  quantities  manufactured  and  exported  had  proved  erroneous.  The 

matter was further  investigated and it was found  that the mistake was due to a clerical 

error.  The  Commission  corrected  that  mistake  and  was  therefore  able  to  reach 

reasonably accurate findings at the definitive  stage. 

The  Commission  revised  its  position  towards  Sôktas,  and  determined  an  individual 

dumping  margin  for  this  company.  The  dumping  margin  for  cooperating  companies 

not in the sample was definitively  established  by also taking  into account the margin 

for  Sôktas. 

Although  the  overall  level  of  cooperation  in  Turkey  remained  the  lowest  among  the 

countries concerned, the representativeness  of the sample was considered  satisfactory 

as it covered 46% of the volume exported by Turkey during the investigation period. 

10 

(b)  Allowances 

(i)  Transport cost 

(32)One  company  contested  the  transport  cost  found  on  export  sales,  which  was 

calculated  to  be  4.31%  of  the  value  of the  product.  It  was  later  discovered  that  the 

basis  for  this  calculation  was  erroneous.  This  resulted  in  a  reduction  of  the  inland 

transport cost to a level of 0.6% of the value of the exports. 

(ii)  Credit cost 

(3 3)At the provisional  stage, the Commission concluded that for  one company,  domestic 

sales were made on the basis  of an open account  system and that this system  did not 

allow the Commission to determine that prices were also a function  of payment terms. 

However,  comments  received  on the provisional  disclosure  highlighted  the  fact  that 

payment  terms  were  stated  on  the  invoice  and  a  due  date  was  agreed  with  the 

customer.  If that payment  term was not respected, the price to be paid  was  modified 

on the basis of the number of days between the due date and the actual payment date. 

On this basis, it was considered that an allowance for the credit cost should be granted 

according to the number of days stated on the invoice. 

(c)  Dumping 

(34)For  the  producers/exporters  selected  in the  sample  the  definitive  dumping  margins, 

expressed  as a percentage  of the  CIF import  price at the  Community  border,  are thé 

following: 

•  Teksmobili: 

•  Birlik Mensucat Ticaret ve Sanayi Isletmesi AS Kayseri': 

•  Sôktas: 

•  Tureks: 

1.6% 

9.5% 

12.8% 

7.1% 

Cooperating  companies  not  selected  in  the  sample  receive  the  weighted  average 

dumping margin of the  sample. Expressed  as a percentage  of the CIF  import price at 

the Community border, the margin is 

10.8%. 

11 

By considering Sôktas as a cooperating party, the level of cooperation with regard to 

imports from Turkey increased to 53%, which was still much lower than the level of 

cooperation  of the  other  countries  concerned,  which were  all  close to  100%. As  a 

consequence,  the method  for  establishing  the  residual  dumping  margin  for  Turkey 

should  remain  the  same  as  in  the  provisional  duty  Regulation  ,  i.e.  based  on  the 

highest dumping margin for a model with representative sales, i.e. 

13.7%. 

3.  Egypt 

(a)  Normal value 

(35)  When  constructing  the  normal  value  at  provisional  stage,  the  Commission  had 

included all costs incurred, including financing  costs as they appeared in the records 

of the company. One company claimed however that long-term loans, totally devoted 

to activities not related to production or sales of cotton fabrics, should not have been 

included  in the Selling General and Administrative  expenses (hereafter  SGA) when 

constructing  the  normal  value  and  provided  sufficient  evidence  to  this  effect. 

Therefore,  it  was  decided  to  correct  the  SGA  and  to  decrease  the  normal  value 

accordingly. 

(b)  Dumping 

(36)The methodology set out in recital (64) of the provisional duty Regulation is hereby 

confirmed. 

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

import price at the Community border, is 

18.5%. 

4. 

Pakistan 

(a)  Normal  value:  inclusion of  stretch fabrics  in  the  determination  of  the 

domestic profit 

(38)One  exporter  producing  stretch  fabrics  argued  that,  should  stretch  fabric  be 

considered  as a  like product,  sales  of this  type  should  not  be accounted  for  in the 

determination of the domestic profit margin because the characteristics of this type of 

fabric meant that they were commanding a higher profit margin than the usual cotton 

12 

fabrics.  In  addition,  it  was  claimed  that  since  stretch  fabrics  were  only  sold 

domestically, they could not have injured the Community  industry. 

As  explained  above,  it  was  found  that  stretch  fabrics  belong  to  the  product  under 

consideration. In accordance with Article 2(6) of the basic Regulation, the amount  for 

profit  has to be determined on the basis of all domestic sales of the like product made 

in  the  ordinary  course  of  trade.  Therefore,  the  fact  that  stretch  fabrics  were  not 

exported during the investigation period is not relevant in this context. 

(b)  Cost of production 

(i) cost of yarn 

(39)At the provisional  stage, it was decided  for  one company  not to rely on the monthly 

costs  statements  specially  prepared  for  the  investigation  because these reports  could 

not  be  linked  with  the  audited  accounts  of  that  company.  Instead,  the  company's 

normal  cost  sheets were used.  On the  spot, the company  did not  clarify  that the  cost 

sheet provided only referred,  as far as yarn costs are concerned, to those of the month 

of  September  while  all  other  cost  items  contained  yearly  averages.  The  company 

claimed  after  the  provisional  disclosure  that  the  cost  of  production  should  be 

corrected  and that the cost of the yarn prevailing  in the month of sale should be used 

instead  of those  contained  in the  cost  sheet,  i.e.  those  prevailing  in  September.  The 

request  was  found  to  be  justified  and  the  cost  of  production  was  corrected 

accordingly. 

The  company  also  claimed  that  the  yarn  costs  used  for  the  purpose  of  determining 

cost  of  production  wrongly  included  the  mark-up  of  the  spinning  department 

belonging to the same company. The Commission based itself on the cost of the yarn 

found  in the cost sheets of the company. Since the company could not demonstrate on 

the spot that there was a mark-up between the spinning  and the weaving  department, 

no modification  was made to the cost sheets of the company. 

(ii) Recovery of waste 

(40)As far  as the income from  waste product was concerned,  several companies  claimed 

that  this  income  should  be  off-set  against  the  cost  of  production.  The  treatment  of 

13 

any  income  generated  by  sales  of  waste  products  was  based  on  the  accounting 

methods kept by the companies concerned. 

(c)  Export price 

(i)  Exchange rates used and credit costs 

(41)Some producers/exporters contested the fact that the Commission refused  to accept 

each lump sum provided by the banks as a normal payment reflecting  the exchange 

rate and the credit cost offered  by these financial  institutions. It should be noted that 

the  exchange  rate used  by the banks  was not  transparent  since  the  conversion rate 

included the fee for  converting the US$ in Rupees and the discount for  cashing the 

credit  letter before  the agreed  term.  Since the producers/exporters  were not  able to 

indicate for each transaction the actual exchange rate used by the bank, it was decided 

to use the monthly average exchange rate of the questionnaire, in accordance with the 

consistent practice of the Commission. 

The credit cost was therefore calculated on the basis of the payment terms agreed and 

the interest rate reported by the producers/exporters . 

(d)  Allowances 

(i)  Withholding tax 

(42)A11 Pakistani  producers/exporters  had to  pay  an  'export  tax'  of  0.75% which was 

deducted  by the bank when payment  for  export  sales was received.  The companies 

claimed  that  this  export tax  should  not  be  deducted  from  the  export  price  since it 

could  be off-set  against any income tax payable.  Since the companies were able to 

prove  that they had indeed off-set this tax, the request was granted. 

(ii)  Duty drawback 

(43)According  to the Pakistani producers/exporters,  the  allowance  made to the normal 

value  for  import  charges  should  have  been  increased.  For  the  purpose  of  the 

provisional  duty  Regulation  ,  an  allowance  was  only  granted  for  the  duty  on the 

chemicals included in the sizing material. The issue was reconsidered. It was found 

that a further  allowance could be granted with regard to excise duty paid on the yarn 

14 

to the extent  that  the actual refunding  of the duty  was proven  during  the  on-the-spot 

verification. 

(e)  Dumping 

(44)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: 

•  Amer Fabrics Ltd and Diamond Fabrics Ltd: 

•  Nishat Fabrics Ltd and Nishat Mills Ltd: 

3.5% 

10.5% 

•  Kohinoor Group (Kohinoor Raiwind Mills Ltd, Kohinoor Weaving Mills Ltd): 9.8% 

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

investigated  was  based  on  the  weighted  average  of  the  sample.  Expressed  as  a 

percentage of the CIF import price at the Community border, the margin is 

9.5.%. 

For the same reasons found  for Indonesia, it was decided to set the residual  dumping 

margin at  the same level as the cooperating companies not in the sample, i.e.  9.5% 

5. 

India 

(a)  General 

(45)  The  Cotton  Textiles  Export  Promotion,  hereafter  'the  Indian  association',  argued 

that  the  sample  of  companies  for  India  was  not  representative  because  it  did  not 

reflect  the  variety  of  looms  used  in India  and  because  it  included  a  company  which 

had  exported  its  production  on  the  basis  of  master  contracts.  Therefore  no  valid 

calculation of an anti-dumping  duty could be based on it. However, the  Commission 

had  accepted  the  selected  producers/exporters  proposed  by  the  Indian  association 

itself,  and  had  also  added  their  largest  exporter to the  sample. The  above  arguments 

advanced  by  the  Indian  association  could  not,  therefore,  put  into  question  the 

representativity of the sample. 

(b)  Normal  Value 

(i) Models used for comparison 

15 

(46)Indian producers claimed that normal value had been incorrectly determined because 

domestic sales of second quality products had not been used for the determination of 

the normal value of certain constructions. 

For the purpose of using  domestic prices in comparing normal  value  and exports to 

the  Community,  the  Commission  had  to  ensure  that  the  constructions  sold  both 

domestically  and  in  the  Community  had  identical  characteristics.  It  was  found 

however that second quality products had characteristics  which made them  different 

from  the first quality products. 

As  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 2(1)  of 

the  basic  Regulation,  i.e.  first  quality  products  sold  on  the  domestic  market  of  the 

exporting country. The request could not, therefore, be accepted. 

(ii) Profit margin used for  constructed normal value 

(47)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. 

In accordance with Article 2(6) of the basic Regulation, the amount for profit has to 

be  determined  on  the  basis  of  all  domestic  sales  of  the  like  product  made  in  the 

ordinary course of trade. The fact, that a particular type of the like product is not sold 

for export, is consequently  irrelevant in this context. Therefore, the request could not 

be accepted. 

(48)One  Indian  company  argued  that  the  Commission  wrongly  refused  to  use  the 

company's  own  profit  when  constructing  normal  values.  Article  2(6)  of  the  basic 

Regulation states that the amount for profits  shall be based on actual data pertaining 

to production and sales, in the ordinary  course of trade, of the like product. As  less 

than 10% of the company's total domestic sales of the like product were made in the 

ordinary course  of trade, in accordance with Article  2(6)(a)  of the basic  Regulation, 

the weighted average of the actual amounts of profit determined for other exporters or 

16 

producers  subject to  the  investigation  in respect  of production  and  sales  of  the  like 

product in India were used. 

(c)  Export price 

(49)No  further  comments  have  been  received  with  regard  to  the  determination  of  the 

export  price.  Therefore,  the  conclusions  reached  in the provisional  duty  Regulation 

are confirmed. 

(d)  Allowances 

(i)  Exchange rates 

(50)Four  Indian  companies  argued  that the  Commission  ought  to  have  applied  Article 

2(10)(j)  by  using  the  actual  exchange  rates  utilised  by  them  when  booking  their 

export  sales.  The  general  principle  laid  down  in  Article  2(10)(j)  of  the  basic 

Regulation  states  that the  conversion  of  currencies  shall  be  made  using  the  rate  of 

exchange  on  the  date  of  sale.  The  only  exception  is  that,  when  a  sale  of  foreign 

currency on forward markets is directly linked to the export sale involved, the rate of 

exchange  in the  forward  sale  shall  be  used.  The  investigation  has  shown that there 

was no  such direct link between the forward  sale  of  currencies  and the  export  sales 

involved.  Furthermore, none of the companies demonstrated that the sale of  forward 

currencies had affected prices and price comparability, as required by Article 2(10) of 

the basic Regulation. 

(51)The  same  companies  also  argued  that  the  Commission  should  have  used  the 

exchange  rate prevailing  on the  date  of  sale,  rather than average  monthly  exchange 

rates.  However,  it  is  the  Institutions'  consistent  practice  to  use  average  monthly 

exchange rates. It would be unduly burdensome to apply daily exchange rates, which 

would in any event lead to practically the same result. 

(52)These  companies  also  argued that,  if  the  Commission  did not  accept  the  exchange 

rates they  used,  the  Commission  should  grant  an automatic  allowance  for  currency 

conversions.  Due  allowance,  in  the  form  of  adjustments,  can,  in  accordance  with 

Article  2(10),  only  be  made  in  each  case,  on  its  merits,  for  differences  in  factors, 

which  are  claimed,  and  demonstrated,  to  affect  prices  and  price  comparability.  As 

none of the companies has demonstrated this type of effect,  the Commission did not 
17 

grant  an  allowance  for  currency  conversions.  Therefore,  the  request  could  not  be 

accepted. 

(ii)  Costs linked to the export price: Payment processing costs 

(53)All Indian companies claimed that the Commission had wrongly deducted from the 

export  prices  as  ancillary  costs,  on  the  basis  of  Article  2(10)(e)  of  the  basic 

Regulation, costs for the processing of payment documents, which they considered to 

be general costs. 

The cost for processing a letter of credit, is directly linked to each specific transaction, 

as  it  is  a part  of  each  sales  transaction  for  which  payment  is  made  on  that basis. 

Therefore,  it  was  concluded  that  such  costs  should  indeed  be  deducted  from  the 

export price. 

(Hi) Discounts, rebates and quantities 

(54)The Indian producers also argued that an allowance should be granted for  differences 

in quantities. In this respect, it should be noted that the requests were neither properly 

quantified  nor directly linked to the sales under consideration. Moreover, the claims 

were not made within the deadlines for  replying  to the questionnaire  and  therefore 

could not be accepted. 

(e)  Dumping 

(i)  Method 

(55)Three  companies  argued  that  the  Commission  incorrectly  decided  to  compare 

average normal values to individual  export prices to the Community. One company 

argued  that the  difference  in dumping  was not  substantial  as  opposed  to the result 

obtained  by  a  comparison  of  a  weighted  average  normal  value  with  a  weighted 

average  export  price.  The  second  company  argued  that  there  was  no  pattern  of 

significantly  different  export  prices,  and  the  third  company  argued  that  the 

Commission should have used the 'master contracts' of that company rather than the 

'dispatch  invoices'  for  the reason that the  importers  calculate  their  mark-up on the 

basis of the average price mentioned in the master contract. 

18 

It was found for each of the three companies that there was a pattern of export prices 

which differed  significantly  among different  purchasers, regions and time periods. It 

was also found  that, taking into account the level of dumping found  for  each of the 

companies, the differences  in dumping between a comparison of normal values and 

export prices on an average-to-average  basis and on an average to a transaction-by-

transaction basis were considerable. The Commission concluded that a comparison on 

an average-to-average basis would not reflect the full  degree of dumping. Therefore, 

the request to compare weighted average export prices with weighted average normal 

values could not be accepted. 

Concerning the third company, the Commission used the dispatch invoices rather than 

the  master  contracts  because  only  the prices  on the dispatch  invoices  reflected  the 

amounts actually paid or payable for the product when sold for export. This is also in 

conformity  with  its  consistent  practice  as  mentioned  in  Article  2(8)  of  the  basic 

Regulation. 

(ii)  Dumping margins 

(56)For the producers/exporters  selected in the sample the definitive  dumping margins, 

expressed as a percentage of the CIF import price at the Community border, are : 

•  Century Textiles and Industries Ltd: 

•  Coats Viyella India Ltd: 

•  Mafatlal Industries Ltd: 

•  Vardhman Spinning & General Mills Ltd: 

•  Virudhunagar Textile Mills and Thiagarajar Mills Ltd: 

14.7% 

15.5% 

16.1% 

4.1% 

5.3% 

Cooperating  companies  not  selected  in  the  sample  receive  the  weighted  average 

dumping margin of the sample. Expressed as a percentage of the CIF import price at 

the Community border, the margin is 

12.8%. 

For the same reasons given with regard to Indonesia, which were also found to apply 

for India, it was decided to set the residual dumping margin at  the same level as for 

the cooperating companies, which is a margin of 

12.8% 

19 

6. 

The People's Republic of China 

(a)  Normal value 

(i)  Non-market economy 

(57)Chinese  producers/exporters  argued  that  the  PRC  was  now  a  market  economy 

country  and that 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. 

While  recognising  the  continuing  process  of  economic  reforms  in  the  PRC  from  a 

planned,  fully  State-controlled  economy  towards  a  market-oriented  economy,  the 

Commission, in accordance with Article 2(7) of the basic Regulation, could not agree 

to this request and the conclusions of recital (160) of the provisional  duty  Regulation 

are therefore  confirmed. 

(ii) Choice of analogue country 

(58)Chinese  producers/exporters  argued  against  the  choice  of  India  as  an  appropriate 

analogue  country  because  only  a  limited  number  of  constructions  were  found  to  be 

comparable to Chinese exports. 

The  Commission  used  all  the  Chinese  products  which  were  found  to  have  a 

comparable construction type sold in the Indian domestic market. This provided a fair 

and reliable basis for comparison since 67.7% of total exports of the sampled Chinese 

producers/exporters  had  been  included  in  the  dumping  calculation.  It  was  also 

considered that this constitutes a representative portion of total Chinese exports of the 

product  concerned  and  that  therefore  India,  in  this  respect,  was  an  appropriate 

analogue country. Moreover, no other analogue country was proposed by any Chinese 

exporter or by the Chinese authorities. 

(b)  Dumping 

(59)The methodology set out in recital (168) of the provisional duty Regulation is hereby 

confirmed. 

20 

(60)The definitive  dumping margin for  the PRC, expressed  as a percentage of the CIF 

import price at the Community border, is 

10.9% 

E. 

INJURY 

1. 

Preliminary remark: the "investigation period" 

(6 l)Some  parties  have  contested  that,  at  the  provisional  stage,  the  Commission  had 

examined trends in injury, causation and Community interest on yearly basis and that 

it has used a period covering July  1996-June  1997, (the injury  investigation period, 

hereinafter referred to as "IIP") instead of the 18-month investigation period. 

Tn this respect,  it  is recalled  that  the  existence  of dumping, price undercutting and 

price underselling has been examined by reference to a period of 18 months covering 

1 January  1996 to 30 June 1997. For the analysis of those aspects of injury requiring 

the examination of trends, such as, inter alia, production, sales, market shares, stocks, 

profitability  and  employment,  the  period  1 January  1993-30  June  1997  has  been 

examined. In this respect, and in order to enable yearly comparisons, instead of the 

18-month investigation period, a 12-month period has been used (IIP) to be compared 

with the calendar years 1993 to 1996. 

2.  Cumulative assessment of the effects of the imports concerned 

(62)In the provisional duty Regulation the issue of the cumulative assessment of imports 

from all  countries  concerned  was examined.  It was provisionally  decided  to assess 

imports from Turkey cumulatively but  to investigate the issue further. 

After  the  imposition  of  provisional  measures,  Pakistani  producers/exporters  also 

claimed that imports from Pakistan should not be cumulated with those from the other 

countries  concerned.  It  was  claimed  that  imports  from  Pakistan  were  made  under 

different  conditions of competition, because between  1993 and the IIP, imports from 

Pakistan  and their  share of the Community market had decreased, while prices had 

increased. 

Indonesian producers/exporters also argued that imports from Indonesia should not be 

cumulated, in view of the low share of the Community market held by these imports 

in  1996 and their decreasing trend  between  1996 and the IIP, and given that prices 

21 

from  Indonesia  were  allegedly  increasing  at  a  rate  higher  than  the  other  countries 

concerned. 

(a)  Turkey 

(63)Concerning  Turkey,  the  request  to  exclude  it  from  the  cumulative  assessment  was 

provisionally rejected on the grounds of the doubts existing on the representativity of 

the  sample  of  producers/exporters,  as  this  might  have  had  an  impact  on  the 

conclusions reached. 

(64)The  Commission  has  reassessed  the  cumulation  of  Turkish  imports  further  to  the 

reconsideration of Sôktas as cooperating company, as mentioned in recital (34). It has 

particularly assessed  the conditions of competition. 

In  this  respect,  it  is  recalled  that  Article  3(4)  of  the  basic  Regulation  stems from 

Article  3(3)  of  the  WTO  Anti-dumping  Agreement,  which  provides  that "Where 

imports of a product from more than one country are simultaneously subject to anti 

dumping  investigations,  the  investigating  authorities  may  cumulatively  assess  the 

effects of such imports only if they determine that (a) [...]  the volume of imports  from 

each country is  not negligible and  (b) a  cumulative assessment of the effects of the 

imports  is  appropriate  in  the  light  of  the  conditions  of  competition  between the 

imported products  and the conditions of competition between the imported products 

and the like domestic product. ". 

In addition, according to Article  5(8) of the WTO Anti-dumping Agreement, "There 

shall  be  immediate termination  in cases  where the [...]  volume of dumped imports, 

actual  or potential,  is negligible. The volume of dumped imports shall  normally be 

regarded  as negligible if the volume of imports from a particular  country is found to 

account for  less  than 3%  of  imports  of  the  like product  in the  importing  Member 

State. ". 

(65)  In this  respect,  the  Commission  found  that  imports from Turkey  sharply  declined 

from around  16.500 tons in 1994 to around 9.700 tons in 1996, i.e. by 41%. Between 

1996 and the IIP, imports further decreased by 43% to around 5.500 tons. Their share 

of  the  Community  market  decreased  from  5.3%  in  1994  to  3.2%  in  1996  and 

22 

represented the lowest market share of all countries concerned. In the IIP, the share of 

Turkish imports decreased to 1.9%. 

While during the  18-month investigation period Turkish imports represented 3.4% of 

total  imports  into the  Community,  during the IIP, Turkish imports represented  only 

2.6% of total imports in to the Community. 

As  to  the  prices  of  Turkish  imports  into  the  Community,  they  increased  by  9% 

between  1993 and 1996; in  1996 the prices of Turkish imports were the highest of all 

countries  concerned.  As  for  price  undercutting,  the  definitive  average  price 

undercutting found for Turkey amounts to 5.1 %. 

(66)It is the established practice of the Community institutions that, when there is clearly 

different  market behaviour between the different  countries concerned in terms of e.g. 

evolution  of  imports,  market  share  and  prices,  which  therefore  demonstrate 

the 

existence  of different  conditions of competition, the effects  that the imports have on 

the Community industry is assessed separately. 

As to the differences  in market behaviour, the decrease  in imports from  Turkey has 

taken  place  over  a  period  of  around  4  years  starting  well  before  the  period  of 

application  of  provisional  anti-dumping  duties  in  the  previous  anti-dumping 

proceeding  concerning  unbleached  cotton  fabrics.  Given  this  extended  time  period 

and the importance of the decrease, it would appear that this decrease is structural and 

not ephemeral.  By contrast, the decrease in the imports from Pakistan and Indonesia 

fully  coincides with the period of imposition of provisional  measures in the previous 

proceeding. 

(67)This  assessment  is  corroborated  by  the  low  level  of  price  undercutting  found  for 

Turkey, the lowest of all countries concerned. 

(68)In view  of all the above  mentioned  factors  on balance,  it is considered that imports 

from  Turkey  should  be  assessed  separately  from  the  other  imports  subjected  to  the 

present investigation. 

(b)  Pakistan 

23 

(69)With  respect  to  Pakistan,  the  Commission  found  that  between  1993  and  1996, 

imports  from  Pakistan  increased  by  10% and their share of  the  Community  market 

remained  stable  at  around  8%.  Between  1994  and  1996  imports  from  Pakistan 

increased  by  around 27% and their share of  the  Community  market  increased from 

around 6% to around 8%. Between 1996 and the IIP, imports from Pakistan decreased 

and  their  share  of  the  Community  market  decreased  to  5%.  The  decrease  in  the 

volume  of imports and the  share of the  Community  market observed between  1996 

and  the  IIP  partly  coincides  with  the  period  of  application  of  provisional  anti 

dumping duties in the previous anti-dumping proceeding. As to the prices of Pakistani 

imports  into  the  Community,  they  increased  by  24% between  1993  and  1996  and 

remained stable between  1996 and the IIP. In 1996, the prices were the lowest of all 

countries concerned. Price undercutting amounted to 9.1% in the investigation period. 

In view  of  the  above,  it  is  considered  that there  are no  grounds  to  depart from the 

conclusions of the provisional duty Regulation, as the trends in the volume of imports 

and  market  share  are  not  such  as  to  show  that  the  conditions  of  competition  are 

different  from the other countries concerned. The cumulative assessment made in the 

provisional duty Regulation is therefore confirmed. 

Furthermore,  even  if  imports  from  Pakistan  were  to  be  assessed  separately,  the 

volume  and price  level  of the dumped imports and their effect  on the prices  in the 

Community market are such that, taken in isolation, would have to be considered as 

to have caused material injury to the Community industry. 

(c) 

Indonesia 

(70)Concerning  Indonesia, between  1993 and  1996 imports have continuously  increased 

from around 9.200 tons to around  13.800 tons. The share of the Community market 

held by imports from Indonesia increased from 3.4% in 1993 to 4.5% in  1996. In the 

IIP  it  decreased  to  3.7%.  As  concerns  the  prices  of  imports  from  Indonesia,  they 

decreased  by  15%  between  1993  and  1996.  Furthermore,  the  average  price 

undercutting found for Indonesia amounts to a significant margin of 24.7%. 

In  view  of  the  above  mentioned,  the  provisional  conclusions  with  respect  to  the 

cumulation of imports from Indonesia are confirmed.  In addition, even if considered 

24 

in. isolation, imports from Indonesia would have to be considered as to have caused 

material injury to the Community industry. 

3.  Volume and market share of the dumped imports 

(71)In  view  of  the  separate  analysis  of  Turkey,  the  volume  and  market  share  of  the 

imports concerned have been assessed as follows: the PRC, Egypt, India, Indonesia 

and Pakistan  (hereinafter  referred  to  as the "five  cumulated  countries"), on the one 

hand, and Turkey, on the other hand. 

(a)  Volume and market share of the dumped imports 

(i)  Cumulated volume and market share of dumped imports 

(72)The volume of imports from the five cumulated countries increased by 13% between 

1993 and  1996, from around  108.000 tons in  1993 to around  122.000 tons in 1996. 

Between  1996 and the IIP (during part of which provisional anti-dumping measures 

were in force),  imports from the five cumulated  countries  decreased  by 22%,  from 

around 122.000 tons to around 94.800 tons. 

The  share  of  the  Community  market  held  by  imports  from  the  five  cumulated 

countries remained stable between 1993 and 1996, at around 39%. In the IIP the share 

of  the  Community  market  held  by  imports  from  the  five  cumulated  countries 

amounted to around 32%. 

(ii)  Volume and market share of imports from Turkey 

(73)Imports from Turkey increased between  1993 and  1994, from  around 9.200 tons in 

1993 to around  16.500 tons in 1994. Between 1994 and 1996 imports showed a sharp 

decline from around 16.500 tons to around 9.700 tons. Their share of the Community 

market decreased from 5.3% to 3.2%. 

Between  1996 and  the  IIP,  imports from Turkey  further  decreased  by  43%,  from 

around  9.700 tons to around  5.500 tons, and their  share of the Community  market 

further decreased to around 1.9%. 

(b)  Comments from interested parties 

25 

(74)One  interested  party  alleged  that the  Commission  analysis  of  the  evolution  of the 

volume of the imports from the countries concerned was flawed: 

firstly,  because  the  Commission  tried  to  explain  the  decrease  in  the 

volume of imports in 1997 by speculating as to the existence of a stocking policy in 

1996 followed by a destocking in 1997; 

secondly,  because  the  above  mentioned  stocking/destocking  behaviour 

would necessitate a degree of freedom over import volumes which does not exist in 

the current framework of quota restrictions. 

(75)On the first point, the Commission has confirmed that the decrease in the volume of 

imports in  1997 followed  a stocking policy  in  1996. The stocking/destocking  policy 

of  companies  importing from the  five  cumulated  countries  has  been  observed  at a 

total  level  (all five cumulated countries). Indeed, between  1995 and  1996 imports of 

the  product  concerned  increased  by  25%,  whereas  the  maximum  increase  in  the 

period  between  1993  and  1995  amounted to  2%. Between November  1995  to May 

1996  and  the  same  period  in  1996  to  1997,  (period  of  imposition  of  provisional 

measures  in  the  previous  proceeding)  imports  decreased  by  39%,  whereas  the 

maximum decrease in the period between  1993 to  1995 amounted to  11%. Similarly, 

information  provided by the  sampled unrelated importers  shows  that, between  1995 

and  1996,  their  imports from the  countries  concerned  increased  by  26%, whereas 

between  1996 and 1997, imports decreased by an estimated 2%. It appears, thus, that 

the  decrease  in  1997  is  partly  attributable  to  and  compensated  for  by  the  increase 

observed in 1996. 

(76)On  the  second  point,  the  Commission  found  that the  existence  of  quotas  does  not 

impede  the  stocking  of  the  product  concerned.  Indeed  quotas  provide  for  a certain 

flexibility  (annual  increases,  carry forwards,  anticipated  use  of  quotas).  In addition, 

the  quota  covering  the  product  concerned  also  covers  other  products.  Therefore,  a 

certain  margin  of  flexibility  exists  in  the  allocations  of  the  quota  to  the  different 

products. 

(77)One  interested  party  has  claimed  that  the  analysis  of  the  volume  of  imports 

concerned  and their  share  of  the  Community  market  carried  out  in  the  provisional 

duty  Regulation  is  inconsistent  since  it  diverges  from  the  data  quoted  by  the 

26 

Commission  in Regulation No 2208/96 imposing provisional duties in the previous 
proceeding concerning unbleached cotton fabrics5 and in the complaint presented by 

Eurocoton in the current proceeding. 

(78)It, should  be  noted  that,  firstly,  Commission  Regulation  (EC)  No  2208/96  had  a 

different  product  coverage  than  the  present  proceeding,  since  gauze,  which  was 

included  in that past proceeding,  is not part of the product coverage  in the present 

proceeding. 

As to any difference  between the volume of imports found  in the investigation  and 

that alleged in the complaint on which the present proceeding is based, the source of 

the data on volume of imports quoted  in the provisional duty Regulation originated 

from Eurostat.  These  statistics  are  constantly  updated  to  take  into  account  import 

figures  arriving late as well as any corrections based on rectified import declarations. 

It is therefore considered that the differences  specified, which in any event are minor, 

do  not  invalidate  the  analyses  of  the  volume  of  imports  and  their  share  of  the 

Community market. 

(79)In view of the above, the provisional findings concerning the volume and the market 

share of the imports are therefore  confirmed. 

4. 

Price of dumped imports 

(a)  Evolution of the prices of the dumped imports 

(i)  Cumulated evolution of the prices of the dumped imports 

(SO)According to information  provided by Eurostat, the weighted average export prices 

from  the five cumulated countries increased from 2.9 ECU/kg in 1993 to 3.2 ECU/kg 

in  1994. Prices further  increased  to  3.6  ECU/kg in  1995 and they decreased  to  3.4 

ECU/kg in 1996. In the IIP, weighted average export prices increased to 3.5 ECU/kg. 

(ii)  Evolution of prices of imports from Turkey 

Commission regulation (EC) No 2208/96 of.18 November 1996, imposing a provisional anti-dumping 
duty on  imports of unbleached  (grey) cotton  fabrics  originating  in the People's  Republic  of  China, 
Egypt, India, Indonesia, Pakistan and Turkey, OJ No L 295,20.11.96, p.3. 

27 

(81)Concerning  Turkey,  export  prices  remained  stable  between  1993  and  1994  at  3.3 

ECU/kg. Prices increased to 3.8  ECU/kg in  1995  and they  decreased to 3.6 ECU/kg 

in 1996. In the IIP, export prices from Turkey increased to 3.7 ECU/kg. 

(b)  Price undercutting 

(82)Following  the  comments  made  by  interested  parties  with  respect  to  the  price 

undercutting margins found at the provisional stage, those have been amended where 

appropriate.  The average price  undercutting  margins  definitively  found per country, 

expressed as a percentage of the Community producer's prices are as follows. 

(i)  Five cumulated countries 

People's Republic of China: 

Egypt: 

India: 

Indonesia: 

Pakistan: 

(ii)  Turkey 

22.3% 

29.1% 

19.1% 

24.5% 

9.1% 

Turkey: 

5.1% 

(c)  Comments made by interested parties 

(83)Interested parties have contested the price undercutting determination. 

Firstly, because the product concerned should not have been grouped into 

categories  according to the  count  of yarn and number of threads, but rather there 

should  have  been  a  direct  comparison  of  each  exported  model  with  the 

corresponding model sold in the Community; 

Secondly, because the Commission did not make an adjustment for quality 

differences or for differences  in the width; 

28 

Thirdly,  because  the  Commission  did  not  make  an  adjustment  for  the 

provisional  anti-dumping  duties  paid  in the  context  of the previous  anti-dumping 

proceeding. 

(84)As to the first point the Commission found that the product concerned originating in 

the countries concerned is imported in many diverse constructions. For the purpose of 

the examination of price undercutting, it was provisionally  considered appropriate to 

group the construction according to certain criteria having the greatest impact on the 

cost  of  the  fabrics.  This  was  done  in  view  of  the  fact  that  certain  imported 

constructions did not have an exact matching Community produced construction and 

because  competition was  found to exist  between products of adjacent constructions. 

As  the  above  approach  results  in  a  broad  coverage  of  both  the  imported  and 

Community  produced products,  it  is  considered  that such  a grouping  reflects  better 

the true extent of the price undercutting. 

As to the second ground, the Commission considered this claim but could not accept 

it.  Indeed, account should  be taken of  the  fact that the Commission  examined price 

undercutting on the basis of constructions grouped according to the count of yarn and 

number of  threads  in  warp and weft.  Any  quality  or width differences  within each 

product group were compensated by a price comparison carried out on an average per 

kilo basis. 

As to the third argument, it should be noted that the provisional  anti-dumping duties 

imposed  in the previous proceeding  were not paid, since  the  Council  never decided 

that they should be collected. They were only guaranteed temporarily and as such did 

not have a direct and immediate impact on import prices. In any event any costs borne 

by importers and relating to the guarantees are already included in the cost accounts 

of  importers.  When  comparing  the  import  prices  and  the  Community  producers 

prices,  import  prices  have  been  adjusted  upwards  for  level  of  trade  to  take  into 

account  the  costs  borne  by  importers  between  importation  and  the  resale  of  those 

fabrics. These costs have therefore already been taken into account. 

(85)One interested party has claimed that the adjustment made for differences  in level of 

trade  between  import  prices  and  resale  prices  of  the  Community  producers  is 

insufficient. 

29 

The  Commission  used  an adjustment  upward  for  level  of  trade  of  8% on  the  CIF 

import  price  duty  unpaid.  It includes  the  average  profit  margin  of  the  importers  as 

well  as  all  weighted  average  costs  incurred  between  importation  and  delivery  to 

customer, that is to converters and finishers. These costs have been calculated on the 

basis  of  verified  information  submitted  by  the  cooperating  unrelated  importers, 

which, account for around 13% of all imports from the countries concerned. 

For these reasons, this claim has to be rejected. 

5. 

Situation of the Community  industry 

(86)In the  provisional  duty Regulation  (recitals  (193)  to  (212))  the  Commission  found 

that the situation of the Community industry was one of material injury. 

(87)Certain  interested  parties  have  claimed  that  the  sample  of  Community  producers 

selected for the analysis of the injury is not statistically valid since between  1993 and 

1996  its  indicators  concerning  production,  sales  and  employment  have  decreased 

more than those of the total Community industry. 

It is standard practice of the Commission that in cases in which sampling  is applied, 

global  indicators,  e.g. production,  sales,  employment,  are  established  for  the  whole 

Community industry, whereas performance indicators such as prices and profitability 

are  established  by  reference  to  the  sampled  Community  producers.  In  the  present 

case, the investigation has confirmed that the total Community industry suffered from 

a  decrease  in  production,  sales  and  employment  during  the  period  1993  to  1996. 

Between  1996  and  the  IIP  production  and  sales  increased.  At  the  same  time  the 

sampled  Community  producers  were  found  to  be  suffering  from  increasing  stocks, 

price suppression and decreasing profitability. 

(88)Some  interested  parties  have  alleged  that the  Community  industry  is  not  suffering 

injury,  since  indicators  concerning  production,  sales,  stocks  and  profitability 

improved between 1996 and the IIP. 

It  has  also  been  alleged  that  the  overall  figures  on  employment  relating  to  the 

Community  industry lack validity  since they relate to unbleached  cotton fabrics  as a 

whole  and not  to  the  product  concerned  by  the  present  proceeding,  i.e.  unbleached 

cotton fabrics containing more than 85% cotton. 

30 

(89)  In  recitals  (194)  to  (210)  of  the  provisional  duty  Regulation,  the  Commission 

established  that,  on  the  one  hand,  between  1993  and  1996  the  situation  of  the 

Community industry worsened. 

On the other hand, between 1996 and the IIP, the situation of the Community industry 

improved. However, this improvement, at a time where imports of unbleached cotton 

fabrics  from  the  countries  concerned  were  subjected  to  provisional  anti-dumping 

measures, has nevertheless not prevented the Community industry from continuing to 

be in a very weak position. 

Secondly, pursuant to Article 3(8) of the basic Regulation, employment pertaining to 

the total Community industry has been calculated for the narrowest group of products 

for  which  information  was  available  to  the  Commission's  services,  i.e.  unbleached 

cotton fabrics containing more than 50% of cotton. 

(90)One  interested  party  has  questioned  the  Commission's  analysis  of  the  two  main 

factors affecting the costs of the Community industry, namely, the evolution of prices 

of  raw  cotton  and  the  costs  arising  as  a  result  of  making  frequent  changes  in 

constructions  and weaving  shorter  series  of  the  same  construction.  Concerning  the 

evolution of prices of raw cotton, this party objects to the use of the ECU to  assess 

that evolution, given that world market prices of raw cotton are expressed in US$ and 

that not all European countries in which weaving companies are present were part of 

the  ERM  between  January  1996  and  June  1997.  As  concerns  costs  arising  from 

frequent  changes in constructions and weaving  shorter series, this party claimed that, 

the  constructions  manufactured  by  the  Community  industry  are  more  complicated, 

they  have  a higher  value  added  and therefore  command  a higher  price,  which  the 

customers are willing to pay. The same would apply to weaving shorter series. 

(91)Regarding the evolution  of  prices of raw cotton, it is  an established  practice  of the 

Community  institutions  to  use  the  ECU  as  the  currency  for  the  calculation  and 

examination of all elements regarding dumping, injury and causation. The use of the 

US$ cannot, therefore, be accepted. 

As to the costs incurred by frequent changes in constructions and shorter runs thereof, 

the Commission found that the Community industry manufactures both standard and 

more specific constructions. In this respect, the pressure of the imports on certain bulk 

31 

constructions obliges the Community industry to diversify  on adjacent  constructions, 

with the result  of an increase  in the  costs. As far  as prices  are  concerned,  even if 

certain constructions may command higher prices, the evolution of the prices of the 

Community industry and its profitability  shows that Community producers have not 

been able to obtain such higher prices in order to cover their costs. 

(92)It is therefore concluded that the provisional findings regarding the evolution of the 

two main factors affecting the costs of Community industry should be confirmed. 

6.  Conclusion 

(93)The  further  investigation  has confirmed  that the Community  industry  has  suffered 

from a decrease in sales, production, employment and profitability  and the Council 

considers  that  the  arguments  presented  by  the  interested  parties  do  not  justify  a 

departure from the provisional findings. For the reasons stated above, it is confirmed 

that  the  Community  industry  has  suffered  material  injury  within  the  meaning  of 

Article 3(1) of the basic Regulation. 

F.  CAUSATION 

1.  Effects of the dumped imports from the countries concerned 

(a)  Cumulated effect of imports from PRC, Egypt, India, Indonesia and Pakistan, 

(94)The increase of imports of the product concerned between  1993 and  1996 coincided 

with  a  deterioration  of  the  financial  situation  of  the  Community  industry,  whose 

market  share  decreased.  The  substantial  price  undercutting  found  exerted  a 

suppression of the prices of Community producers leading to losses. Since the market 

for  unbleached  cotton fabrics  is highly price  sensitive and transparent, the pressure 

exerted  by  the  imports  concerned  in  the  form  of  price  undercutting  caused  price 

suppression for the Community producers leading to financial losses. 

(95)It  is, therefore,  considered  that  dumped  imports from the five cumulated  countries 

have, taken  in  isolation,  caused  material  injury  to  the  Community  industry.  These 

findings  are confirmed. 

(b)  Effect of imports from Turkey 

32 

(96)As far as Turkey is concerned, limited price undercutting has been found. However, 

this  price  undercutting  did  not  lead  to  an  increase  of  the  market  share  of  Turkish 

imports. On the contrary, Turkish imports have sharply decreased and, in the IIP, only 

had a  1.9% share of the Community market.  Given this  decrease, the small market 

share  and  the  fact  that  price  undercutting  is  relatively  small,  it  is  considered  that 

imports from Turkey have not had an impact to a degree  such as to be classified  as 

material, within the meaning of Articles 3(5) and 6 of the basic Regulation. 

(97)It is therefore considered that protective measures are unnecessary as regards Turkey. 

2. 

Effects  of other factors 

(98)In the provisional  duty Regulation the Commission examined  factors other than the 

dumped imports in order to ensure that possible  injury caused by those factors were 

not attributed to the dumped imports. The Commission found that the effects  of those 

factors, if any, were not such as to break the causal link between the dumped imports 

and the material injury suffered by the Community industry. 

(99)Some  interested  parties  have  argued  that  any  injury  suffered  by  the  Community 

industry  is to be attributed to imports of the product concerned from third countries 

other than the countries concerned. In particular it was mentioned that while imports 

from  other third countries have increased their share of the Community market, those 

from the  countries concerned have remained stable between  1993 to  1996  and have 

decreased  in  the  IIP.  Furthermore,  export  prices  from  other  third  countries,  e.g. 

Russia, were substantially  lower than those  from the countries concerned.  Therefore 

those  countries  should  also  be covered  by the  investigation.  Failure to do  so  would 

contravene  Article  12(2)  of  the  WTO Anti-dumping  Agreement  and Article  9(5)  of 

the basic Regulation. 

In  addition,  some  interested  parties  have  also  alleged  that  the  negative  economic 

situation of the Community industry is correspond to that of the textile industry as a 

whole  and  was  thus  not  the  result  of  any  dumped  imports.  In  support  of  these 

evidence, global figures for  1997 and corresponding to the textile industry as a whole 

have been presented. 

33 

Finally, it has been argued that imports from the countries concerned could not be the 

cause  of the injury  since the imported  constructions  and those manufactured  in the 

Community were different  and therefore did not compete with each other. 

(100)In this respect it should be recalled that  the imports concerned do not need to be the 

sole or the principal cause of the difficult  situation of the Community industry. It is 

sufficient  that, taken in isolation, imports from the countries concerned  have caused 

material injury. 

(lOl)The  Commission,  firstly,  found  that  imports from the  five  cumulated  countries 

increased  from  around  108.000  tons  in  1993  to  around  122.000  tons  in  1996. 

Although between 1996 and the IIP, imports from the countries concerned decreased, 

account should be taken that this period coincided with the past period of imposition 

of provisional measures. The resulting market share of the five cumulated  countries 

has  remained  stable  at  the  significant  level  of  39%.  Furthermore,  it  has  been 

established that these imports were made at prices which significantly  undercut those 

of  the  Community  industry.  It  cannot  therefore  be  argued  that  the  impact  of  the 

imports from  other countries has been such as to break the causal  link between the 

imports from the five cumulated  countries  and  the  injury  suffered  by  Community 

industry. 

Secondly, while it may be true that prices of imports from other third countries are in 

some  instances  lower  than  those from the  countries  concerned,  no  indication  was 

given  that  they  were  made  at  a  dumped  level,  i.e.  that  they  were  lower  than  the 

normal value in the respective country. 

Thirdly, while it may also be true that the recession has contributed  to the  difficult 

situation of the Community industry, this has not prevented the dumped imports  from 

the countries concerned from causing injury to the Community industry in by further 

worsening its situation. 

(102)As  to  the  lack  of  competition  between  imported  constructions  and  those 

manufactured  by  the  Community  industry,  the  investigation  has  shown  that,  the 

imports are concentrated on a limited number of constructions. It has also been found 

that those constructions are nevertheless produced by the Community industry. In this 

respect,  account  should  further  be  taken  of  the  high  degree  of  interchangeability 

34 

between fabric belonging to adjacent constructions. As to the rest of the imports  from 

the countries concerned, they are spread over many constructions imported in small 

quantities.  These  constructions  also  compete  with  the  corresponding  ones 

manufactured by the Community industry. 

(103)Finally, the imposition of anti-dumping duties cannot be contested on the grounds 

that  the  imposition  of  duties  in  the  present  proceeding  would  not  protect  the 

Community  industry  against  competition from imports from other  third  countries, 

which  are  not  dumped.  The  fact  that  the  Community  industry  is  experiencing 

difficulties  attributable in part to causes other than the dumped imports is not a reason 

for depriving that industry from the protection against the injury caused by dumping. 

It should be mentioned that between 1993 and 1996 the imports concerned increased, 

that  their  market  share  remained  stable  and  that  during  the  investigation  period, 

substantial  price  undercutting  was  found  for  the  producers/exporters  in  the  five 

cumulated  countries. At the same time the Community producers were found  to be 

suffering  injury  in  the  form  of  a  decrease  in  production,  sales,  market  share  and 

profitability. 

(104)In view of the above mentioned, the provisional findings concerning causation are 

therefore  confirmed. 

G. 

COMMUNITY INTEREST 

1. 

The Community industry 

(a)  Effects of the past imposition of measures on the Community industry 

(105)In the provisional  duty  Regulation,  the  Commission  concluded  that  anti-dumping 

measures  would  benefit  the  Community  industry  in terms of  increased  production, 

sales and profitability.  This had been confirmed  by the developments during the past 

period of imposition of provisional measures. 

(106)Some parties have disputed the Commission's conclusions as to the effectiveness  of 

the imposition  of provisional measures in the previous proceeding on the  following 

grounds: 

Firstly, provisional duties were not directly collected and therefore  could 

not account for any improvement of the Community industry. 

35 

Secondly,  the examples  given  in the provisional  duty  Regulation  on the 

effectiveness  of  the  measures  lacked  validity  since  they  constituted  selective 

examples. 

Finally,  even  if  measures  were  to  be  imposed,  the  Community  industry 

would  not  produce  or  would  be  unable  to  produce  the  product  concerned  for 

commodity  types  of  lower  specification  fabrics,  since  it  concentrated  on  higher 

value  added fabrics. Therefore, measures would unduly burden importers, without 

benefiting  the  Community  industry. As  supporting  evidence  parties  submitted the 

results  of  a  survey  carried  out  among  Community  producers  seeking  price 

quotations  for  certain  volumes  of  specific  constructions,  which  resulted  in  a 

number of negative responses. 

(107)Firstly,  experience  shows that even  if provisional  duties  are not  directly  collected 

but only provisionally  guaranteed, economic  operators take them into account when 

deciding  whether  to  import  or  to  purchase  from  the  Community  industry.  This 

happened  also  in  the  previous  proceeding.  Indeed,  users  of  the  product  concerned 

increased  their  purchases  from  Community  producers.  This  demonstrates  that  the 

provisional  duties  imposed  were  directly  beneficial  to  Community  producers.  This 

beneficial  effect  was ascertained at the level of the sampled Community producers as 

well  as at the level  of thé Community  industry as a whole  (recitals (194) to (210) of 

the  provisional  duty  Regulation).  It  cannot  therefore  be  argued  that  the  beneficial 

effects have been established by reference to certain selected companies. 

(108)As  to the results of the survey  carried out among a certain number of  Community 

producers, it appears that this survey was cursory, and therefore cannot be considered 

as representative of the position of the Community industry. Therefore, the argument 

has to be rejected. 

(b) 

Import substitution: finished products 

(109)Some  parties  have  argued  that  the  Commission's  analysis  in  the  provisional 

Regulation  of  the  effect  of  quotas  on  imports  of  finished  fabrics  and  unbleached 

fabrics is inconsistent and therefore invalid. It has been argued that if existing quotas 

on imports of finished fabrics would prevent any significant  shift towards imports of 

such  fabrics  from  third  countries,  the  same  argument  should  be  valid  mutatis 

36 

mutandis for unbleached cotton fabrics. It has also been argued that the Commission's 

findings  with regard to  quota category  2  and 2a were  irrelevant  since  this  category 

also included finished fabrics, as well as fabrics containing less than 85% cotton. 

(110)Some parties have also questioned the economic analysis of the surge in imports of 

bleached fabrics during the past period of imposition of provisional  measures. While 

these  parties  do  not  question  the  correctness  of  the  cost  of  bleaching  in  the 

Community quoted in the provisional  duty Regulation, doubts have been raised as to 

the prices quoted for bleached fabrics imported from third countries. In support of this 

position  information  concerning  prices  of  bleached  fabrics  imported  by  one 

cooperating  unrelated  importer  from  Pakistan  has  been  presented  showing  a price 

level, i.e. 3.8 to 3.9 ECU/kg, lower than that quoted by the Commission. 

(11 l)With respect to finished fabrics, the issue to be analysed is whether the imposition 

of duties on the product concerned could cause  a surge in the volume  of  imports of 

finished fabrics.  It is  in  this  context  that  the  existence  of  imports  quotas  has been 

analysed. 

(112)Concerning subquota category 2a, it covers printed and dyed fabrics as well as dyed 

yarn of both more and less than 85% cotton. However, the maximum possible margin 

of expansion of the utilisation of this quota, on the basis of the unused quantities of 

category  2a products, has been estimated at 20.000 to 25.000  tons.  Given the stable 

trend in imports of fabrics  made of dyed yarn coinciding  with a stable  consumption 

for this product in the Community, and the small share represented by finished fabrics 

of less than 85% cotton (around 7% of total  imports category 2a fabrics), no further 

margin  of  expansion  of  category  2a  fabrics  is  likely.  The  argument  that  quota 

category 2a cannot act as an effective  break to a surge in imports of printed and dyed 

fabrics,  on the  grounds that this  subcategory  covers products other than the product 

concerned, must therefore be rejected. 

As  to  the  analysis  of  the  imports  of  bleached  fabrics,  in  the  provisional  duty 

Regulation  prices  were  specified  on  the  basis  of  Eurostat  for  imports  of  bleached 

fabrics  from  third  countries.  These  statistics  correspond  to  the  total  exports  of 

bleached  fabrics  from  the  all  exporting  countries  and as  such  accurately  reflect  the 

product mix of that country.  The prices of bleached fabrics imported from Pakistan, 

37 

were  4.5  ECU/kg  in  1996  and  in  the  IIP,  it  increased  to  4.7  ECU/kg  in  1997.  A 

further  investigation  of  this  issue  by  reference  to  the  period  January-March  1998 

shows that prices  of  bleached  fabrics  further  increased  to  5.3  ECU/kg  in the period 

January-March  1998.  Average  prices  of  bleached  fabrics  from  India  and  Pakistan 

amounted to 4.7 ECU/kg in 1996,4.6 ECU/kg in the IIP, 4.8 ECU/kg in 1997 and 5.4 

ECU/kg in the period January-March 1998. 

The analysis in the provisional  duty Regulation showed that it was not  economically 

justified  to import bleached fabrics as a means to avoid the anti-dumping duties. The 

further investigation has confirmed this analysis. 

(c)  Limited capacities available in the Community 

(113)One  interested  party  claimed  that the  Commission's  finding  that  the  Community 

industry  had  sufficient  flexibility  to  increase  capacities  in  order  to  prevent  supply 

shortages  was  incorrect,  since  it  was  not reasonable  to  expect  that  the  Community 

industry could supply 72% of the market. 

(114)The Commission, in the provisional duty Regulation, found that capacity would not 

be  an  impediment  for  Community  producers  to  benefit  from  any  anti-dumping 

measure imposed. Indeed, the increase in production by Community producers at the 

time  where  provisional  measures  were  in  place  shows  that  a  certain  flexibility  as 

regards the capacity of Community industry does exist. 

(d) 

Import substitution: made-up articles 

(115)Some parties have  alleged  that the  imposition  of  duties  on imports  of  unbleached 

cotton fabrics will not only cause a shift  in imports towards finished fabrics, but will 

also ultimately result in a surge of imports of made-up articles. This would have as a 

consequence that the Community industry would ultimately not benefit from any anti 

dumping measure imposed. 

(116)The  Commission  examined  the  evolution  of  imports  of  made-up  articles  between 

1993 and the IIP. For the purpose of that examination a number of made-up articles, 

constituting  the bulk of the made-up articles incorporating unbleached  cotton fabrics 

of more than 50% cotton, were considered: curtains, bed linen, table linen and shirts. 

38 

(117)It  was  found  that  imports  of  curtains  and  bed  linen  have  continuously  increased 

since  1993, at a time where no anti-dumping measures were in place. Between  1993 

and  1996,  total  imports  of  curtains  have  increased  by  around  199%,  whereas  the 

increase  in  imports  of  curtains from the  countries  concerned  was  lower,  at around 

136%. As regards bed linen, total imports increased by 21% between 1993 and 1996. 

Regarding imports of table linen, these remained stable between  1993  and  1995 and 

increased  in  1996  (by  9.7%),  whereas  imports  of  shirts  increased by  30% between 

1993 and 1996. 

Between  1996  and the  IIP,  partly  coinciding  with  the  past  period  of  imposition  of 

provisional measures, imports of curtains, bed linen and table linen from the countries 

concerned  continued  to  increase,  although  at  a  lower  rate:  23%  with  respect  to 

curtains,  10% with respect to bed linen and 10% with respect to table linen. Between 

1996 and the IIP, imports of shirts decreased by 2%. 

(118)Imports  of  made-up  articles  continuously  increased  between  1993  and  1996.  The 

imposition  of  provisional  anti-dumping  duties  on  unbleached  cotton  fabrics  in 

November  1996 did not cause a surge in the imports of made-up articles. In addition, 

made-up articles are also  subject to import quotas, as are the imports of the product 

concerned and of finished  fabrics. Furthermore, any such surge would necessitate the 

setting-up  of  production  facilities  in  the  exporting  countries  for  made-up  articles 

which,  since  it  also  involves  the finishing of  the  fabrics,  would  require  significant 

investments. 

(119)For all these reasons, a surge in imports of made-up articles due to the imposition of 

anti-dumping measures is unlikely. 

2.  Other considerations 

(120)According  to  Article  21  of  the  basic  Regulation,  special  consideration  should  be 

given to the need to eliminate the trade distorting effects of injurious dumping and the 

need to restore effective  competition. 

In this context, the access  of Community manufactured  unbleached cotton fabrics to 

the five countries subject to this investigation has been examined. 

39 

(121)Exports of the product concerned to the PRC, Egypt, India, Indonesia and Pakistan 

amounted to a mere  164 tons in  1996 and  134 tons in the IIP, compared to a total 

volume of exports of the product concerned of 13.000 tons in 1996 and 13.100 tons in 

the IIP, i.e. around 1% of total Community exports. 

The  market  access  of  Community  produced  unbleached  cotton  fabrics  is  rendered 

almost meaningless due to the existence of customs duties on imports of the product 

concerned manufactured  in the Community amounting to the following:  19% in the 

PRC,  60% in Egypt, 40% in India,  15%  in  Indonesia  and  45% in  Pakistan  where 

imports of the product concerned are not permitted without specific authorisation. 

The  situation  is  similar  as  concerns finished fabrics  and  made-up  articles. Indeed, 

exports  of finished fabrics  to  the  five  countries  countries  concerned  amounted  to 

around  1% of  total  Community  exports  of  those  fabrics.  In  the  case  of  made-up 

articles, exports to the five cumulated  countries  amounted  to  around  0.2% of total 

Community exports of those made-up articles. 

(122)It  can  therefore  be argued  that  there  is  a  significant  impediment  to  Community 

exports  of  the  product  concerned,  and  of  downstream  products  incorporating  it, 

constituting therefore a trade distorting effect. 

3.  Conclusion on Community Interest 

(123)Some  parties have questioned  the conclusions  reached  by the  Commission  in the 

provisional  duty Regulation that no compelling  reasons were found  on Community 

interest  grounds  against  the  imposition  of  anti-dumping  measures.  These  parties 

argued that the Commission analysed the likely effects  of any anti-dumping measure 

in the current proceeding to the downstream  industry, only by reference  to the past 

period  of  imposition  of  provisional  measures,  six  months.  They  argued  that  if 

definitive  measures,  lasting five years,  were  imposed,  the  negative  effects  on  the 

downstream industry would be such as to constitute a compelling reason against the 

imposition of measures. 

(124)In  the  provisional  duty  Regulation,  the  effects  on  the  downstream  industry  of 

imposing  any  anti-dumping  measure  was examined.  While  certain  aspects, such as 

cost and price increases were analysed by reference to the past period of imposition of 

40 

provisional anti-dumping duties, some other more structural aspects of trade in cotton 

fabrics,  such as the existence of quotas on imports of finished fabrics  and made-up 

goods,  the  comparative  advantages  enjoyed  by  Community  finishers  and  the  low 

import penetration  of finished fabrics, militated  against considering that compelling 

reasons existed against the imposition of anti-dumping measures. 

(125)The  arguments  presented  by  interested  parties  subsequent  to  the  imposition  of 

provisional duties on the Community interest aspects of the proceeding as set forth in 

recitals (240) to (371) of the provisional duty Regulation have been examined. Since 

these  arguments  do  not  justify  a  departure  from  the  assessment  made  in  the 

provisional  duty Regulation, the Council confirms  that no compelling  reasons have 

been found against the imposition of anti-dumping measures. 

H. 

ANTI-DUMPING MEASURES 

1. 

Injury elimination level 

(126)In accordance with the relevant provisions of the basic Regulation, it was examined 

whether the measures should be less than the dumping margins found, if such lesser 

measures  would  be  adequate  to  remove  the  injury  suffered  by  the  Community 

industry as a consequence of dumping. 

(127)Given the injury  found,  in particular in the form  of lack of profitability  and price 

suppression, it is considered that anti-dumping measures should increase the prices of 

the dumped imports to attain a non injurious level. 

(128)In order to obtain a non injurious price level, at the provisional stage, the weighted 

average profit shortfall of the sampled Community producers during the investigation 

period,  together  with  a  minimum  profit,  was  added  to  the  Community  producers' 

sales prices. 

(129)  Several parties  argued that the minimum  profit  margin  should not be set at 8%. 

Information was provided purporting to show that even at times were the Community 

industry was profitable, such profitability was far below 8%. 

(130)The  rationale  of  such  a  minimum  profit  margin  is  to  reflect  the  profit  that  the 

Community  industry  could  reasonably  be  expected  to  achieve  in  the  absence  of 

41 

injurious  dumping.  On the  basis  of  the  information  submitted  by  interested  parties 

this profit  margin continues to be determined as being 8%. This margin reflects  also 

the fact that the Community industry has to recover from the effects  of past dumping. 

In  addition,  such  a  profit  margin  is  in  line  with  the  standard  practice  of  the 

Community  Institutions  for  this  type  of  industry.  Furthermore,  this  is  the  profit 

margin  that  was  considered  appropriate  in  the  context  of  a  previous  proceeding 

concerning  unbleached  cotton  fabrics.  The  minimum  profit  margin  used  in  the 

provisional duty Regulation is therefore confirmed. 

(131)According to Article  9(4)  of the basic Regulation,  where the margins  of  dumping 

found  in  respect  of  a particular  exporting  producer  were  below  the  corresponding 

increases  in  import  prices  necessary  to  remove  injury,  as  calculated  above,  the 

definitive  duties have been limited to the dumping margin established. 

These  duties,  expressed  as  a percentage  of the  CIF net,  free-at-Community-frontier 

price, before duty amount to: 

The PRC: 

All producers/exporters: 

Egypt: 

All producers/exporters: 

India: 

Coats Viyella India Ltd.: 

Vardhman Spinning & General Mills Ltd: 

Mafatlal Industries Limited: 

Century Textiles and Industries Ltd: 

Virudhunagar Textile Mills and Thiagarajar Mills Ltd: 

Cooperating companies not in the sample: 

Non-cooperators: 

Indonesia: 

P.T. Apac Inti Corpora: 

P.T. Argo Pantes+ P.T. Daya Manunggal: 

42 

10.9% 

18.5% 

5.3% 

4.1 % 

16.1% 

14.7% 

5.3% 

12.8% 

12.8% 

11.8% 

13.7% 

P.T. Eratex Djaja: 

Cooperating companies not in the sample: 

Non-cooperators: 

Pakistan: 

Amer Fabrics Ltd and Diamond Fabrics Ltd and: 

Nishat Fabrics Ltd and Nishat Mills Ltd: 

12.7% 

12.2% 

12.2% 

3.5% 

10.5% 

Kohinoor Group (Kohinoor Raiwind Mills Ltd and Kohinoor Weaving Mills 

Ltd): 

Cooperating companies not in the sample: 

Non-cooperators: 

2. 

Undertakings 

9.8% 

9.5% 

9.5% 

(132)In  accordance  with  Article  8  of  the  basic  Regulation,  the  possibility  of  price 

undertakings  was  discussed  with  the  producers/exporters  in  the  five  cumulated 

countries.  Further  to  these  discussions,  undertakings  were  offered  by  the 

producers/exporters and accepted by the Commission in Commission Decision No.... 

(133)These  undertakings  are based  on  a minimum  price valid  for  a limited  number  of 

constructions (i.e. combination of pair of count of yam and number of threads in warp 

and weft), which represent a large proportion of the exports to the Community of the 

producers/exporters  in  each  of  the  five  cumulated  countries  as  well  as  for  fabrics 

weighing less than 100 gr/m2. The minimum prices have been calculated on the basis 

of the CIF net, free-at-Community-frontier price, increased by the dumping or injury 

margins, which ever is the lowest, as appropriate. 

(134)In order to avoid circumvention by the export of constructions not included within 

the undertakings, a country-wide quantitative ceiling is set per construction subject to 

the  undertaking.  Once  this  quantitative  ceiling  is  reached,  imports  of  these 

constructions  will  not be  subject to  the  minimum  prices, but will  be  subject  to the 

applicable anti-dumping duty. 

To ensure that the quantity of  imports exempted from the ad valorem duty does not 

exceed  the quantitative  ceilings  fixed  by the  undertakings, the exemption  should  be 

conditional  on the presentation to  Member  States'  customs  services  of  valid  import 

43 

licences clearly identifying  the producer, the construction concerned and the import 
volume.6 

Fabrics weighing less than 100 gr/m2 will not be subject to quantitative ceilings given 

that the risk of circumvention for those fabrics  is limited: they represent a marginal 

segment of the market and are easily identifiable at customs level by their weight. 

3. 

Definitive duties 

(135)Notwithstanding 

the  acceptance  of 

the  undertakings  offered  by 

the 

producers/exporters  from  the  countries  concerned,  the  producers/exporters  not 

signatories to undertakings, the constructions not covered by the undertakings and the 

constructions subject to the undertaking but exceeding the volumes established, will 

be subject to the ad valorem anti-dumping duties on imports of the product concerned 

to  the  Community.  This will  also  underpin  the undertakings  by discouraging  their 

circumvention. 

(136)Fabrics weighing less than  100 gr/m2 constitute a marginal market segment. Such 

fabrics  are  imported  in  two  distinct  qualities;  one  woven  with  ordinary  yarn  and 

imported  at  low  prices,  the  other  woven  using  thin  high  quality,  resistant  yarn, 

imported at high prices, which are not generally a cause of injury to the Community 

industry.  The  specific  characteristics  of  these  fabrics  mean  that  on the  one  hand, 

imposing  an  ad  valorem  duty  would  be  disproportionate  in  that  the  high  quality 

segment would be subject to high duties, whereas on the other hand a straightforward 

minimum price duty would not be appropriate in respect of the low priced segment. 

(137)It was decided therefore to set a minimum price duty, subject to the limitation that 

imports made below the minimum price will only pay the relevant ad valorem duty. 

The  impact  of the ad valorem  duty  on imports  of the  low quality  segment  should 

mean that imports of such fabrics  can continue to be made at below the minimum 

price. Where the ad valorem duty would raise the price above the minimum price, the 

duty  will  be  limited  to  the  difference  between  the  import  price  and  the  minimum 

price. 

6  Under  Council  Regulation  (EEC) No  3030/93,  import  licences  are  delivered  for the  importation  of 
unbleached cotton fabrics into the Community. This system will be used in the context of the current 
anti-dumping proceeding. 

44 

(138)In  establishing  minimum  prices  for  those  fabrics,  it  is  considered  that,  in  the 

absence 

of 

representative 

information 

available 

from 

the 

sampled 

producers/exporters,  these  minimum  prices  should  be  based  on  import  prices  as 

reported  by  Eurostat.  Information  from  Eurostat  reflects  the  product  mix  within 
imported  fabrics  weighing  less  than  100 gr/m2  and  adding  the  anti-dumping  duty 

applicable  to  the  cooperating  producers/exporter  in  each  country  concerned  to the 

import  prices per  country  reported  by  Eurostat,  results  in  a minimum  price which 

would sufficiently  remove the injury to the Community industry. 

(139)The minimum prices thereby established are as follows: 

Country 

ThePRC 

Egypt 

India 

Indonesia 

Pakistan 

Minimum price ECU/kg 

4?7 

6.0 

5.6 

4.9 

4.2 

I. 

COLLECTION OF PROVISIONAL DUTIES 

(140)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  under  Regulation  (EC)  No  773/98  should  be 

definitively  collected at the rate of the duty definitively  imposed. This decision also 

applies to the companies which are signatories to the undertakings. 

(141)As concerns fabrics weighing less than  100 gr/m2, the amounts secured by way of 

provisional  duties shall be released.  Indeed,  in view of the fact  that the  distinction 
between fabrics weighing more and less than  100 gr/m2 has only been introduced at 

the definitive  stage, the collection of the provisional  duties for those fabrics  appears 

inappropriate. 

(142)As  concerns  imports  of  the  product  concerned  originating  in  Turkey,  amounts 

secured by way of provisional anti-dumping duties should be released. 

45 

HAS ADOPTED THIS REGULATION: 

Article I 

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

fabrics,  falling  within ex CN codes 5208  11 90 to 5208  19 and 5209  11 to  5209 19 

(TARIC codes 5208 11 90 90, 5208 12 11  90, 5208 12 13 90, 5208 12 15 90, 5208 12 

19 90, 5208 12 91 90, 5208 12 93 90, 5208 12 95 90, 5208 12 99 90, 5208 13 00 91, 

5208 13 00 99, 5208 19 00 91, 5208 19 00 99, 5209 11  00 90, 5209 12 00 90, 5209 19 

00 90) and originating in the People's Republic of China, Egypt, India, Indonesia and 

Pakistan. 

2.  Subject  to paragraph  3, the rate of the anti-dumping  duty applicable to the  CIF net, 

free-at-Community-frontier  price,  before  duty,  shall  be  as  follows  for  products 

originating in: 

Country 

Rate of duty 

Taric additional code 

The People's Republic of China 

10.9% 

18.5% 

Egypt 

India" 

Indonesia 

Pakistan 

: 

: 

nWo 

12.2% 

9.5% 

8900 

8900 

8900 

3. The products manufactured  and sold for export by the companies listed below shall be 

subject to the following rates of anti-dumping duty: 

Country: India 

Rate of duty 

Taric additional 

Century Textiles & Industries Limited 

14.7% 

" 

: 

8913 

Coats Viyella India Limited 

53% 

" 

8914 

code 

46 

Vardhman Spinning & General Mills 

I 

4.1% 

I 

89B 

Limited 

Mafatlal Industries Limited 

16.1% 

Virudhunagar Textile Mills and 
Thiagarjar Mills Ltd. 

' 

5.3% 

8917 

89l<5 

Country: Indonesia 

Rate of duty 

Taric additional code 

Group Argo Pantes (P.T. Argo 

13.7% 

8919 

Pantes and PT Daya Manunggal) 

Apac Inti Corpora 

! 

11.8% 

Eratex Djaja 

12.7% 

8918 

8922 

Country: Pakistan 

Rate of duty 

Taric additional code 

Amer Fabrics Ltd and Diamond 

3.5% 

Fabrics Ltd. 

Nishat Mills Ltd and Nishat Mills 

10.5% 

Ltd 

Kohinoor Group (Kohinoor 

9.8% 

Raiwind Mills Ltd and Kohinoor 

Weaving Mills Ltd) 

8923 

8928 

8925 

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

apply. 

Article 2 

1. Import of unbleached  cotton fabrics  weighing not more than  100 gr/m2 (Taric codes 

5208  11 90 90, 5208  13 00 91 and  5208  19 00 91) shall be exempt from the duty 

imposed  by Article  1, when  imports  of  such fabrics  are made  above the  following 

minimum CIF net, free-at-Community-frontier prices, before duty: 

47 

Country 

Minimum price ECU/kg 

The People' Republic of China 

Egypt 

India 

Indonesia 

Pakistan 

4.7 

6.0 

5.6 

4.9 

4.2 

2. Other imports of unbleached cotton fabrics weighing not more than 100 gr/m2 shall be 

subject to the relevant duty imposed by Article 1. In cases where the application of the 

relevant duty would increase the import price above the level of the relevant minimum 

price in paragraph  1, only the difference  between the import price and the minimum 

price shall be imposed 

Article 3 

Imports of the product classified under the CN codes mentioned in Article 1(1) above, 

produced  and  sold  for  export  to  the  Community  by  the  companies  which  offered 

undertakings accepted by Commission Decision No 

, shall be exempted from the 

anti-dumping duties imposed by Articles 1  and 2, provided that such imports are made 

in conformity with the system laid down in that Decision. 

Article 4 

1.  Products classified  under the CN codes mentioned in Article  1(1) above and woven 

on looms operated exclusively by hand or foot are exempted from the duty imposed 

in Article 1  of this Regulation (TARIC codes 5208 11 90 10, 5208 12 1110, 5208 12 

13 10, 5208 12 15 10, 5208 12 19 10, 5208 12 91 10, 5208 12 93 10, 5208 12 95 10, 

5208 12 99 10, 5208 13 00 10, 5208 19 00 10, 5209 11 00 10, 5209 12 00 10, 5209 

19 00 10). 

2.  The  exemption  referred  to  in  paragraph  1  shall  be  granted  only  to  products 

accompanied on their release for free circulation in the Community by either 

a)  a  certificate  from  the  competent  authorities  of  the  country  of  origin  which 

conforms to the model attached as Annex I; or 

48 

b)  a certificate issued pursuant to Article 3 of Council Regulation (EEC) 3030/937. 

3.  Certificates  issued pursuant to paragraph 2(a)  shall  only  be valid if the countries  of 

origin  have  informed  the  Commission  of  the  names  and  addresses  of  the 

governmental  authorities  situated  in  their  territory  which  are  empowered  to  issue 

these certificates, together with specimens of stamps used by those authorities and the 

names  and  addresses  of  the  relevant  governmental  authorities  responsible  for  the 

control of the certificates.  The stamps shall be valid as from the date of receipt by the 

Commission of the specimens. 

4.  Certificates  issued  pursuant  to  paragraph  2  shall  only  be  valid  if  presented  with 

options  (b) and (c) in box  11 deleted and if they certify  that the products concerned 

fulfil the description in option (a). 

The appropriate provisions implementing the Community Customs Code, and notably the 

provisions concerning administrative co-operation contained in Article 93, 93 bis and 94 

of Regulation (EEC) 2454/938, as amended in particular by Commission Regulation (EC) 

12/979, shall apply mutatis mutandis. 

Article 5 

1. As  regards imports of the product described  in Article  1(1) above  originating  in The 

People's  Republic  of  China,  Egypt,  India,  Indonesia  and  Pakistan,  the  amounts 

secured by way of the provisional anti-dumping duty imposed by Regulation (EC) No 

773/98  shall be collected  at the rate of the duty definitively  imposed.  This provision 

also  applies  to  the  companies  signatories  of  the  undertakings,  as  regards  the 

provisional duties secured. 

2. As regards imports of fabrics weighing less than 100 gr/m2 originating in The People's 

Republic of China, Egypt, India, Indonesia and Pakistan, the amounts secured by way 

of provisional duties shall be released. 

3.  As  regards  imports  of  the  product  described  in  Article  1(1)  above  originating  in 

Turkey, the amounts secured by way of provisional duties shall be released. 

7  OJ No  L 275, 8.11.93, p. 1 

8  OJ No L 253,  11.10.93, p.  1 

49 

Article 6 

The proceeding is hereby terminated as concerns imports of the product described in 

Article  1(1) above originating in Turkey. 

Article 7 

This Regulation shall enter into force on the day following that of 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, 

1998. 

9  OJNoL9,13.1.97, p. 1. 

50 

ISSN 0254-1475 

COM(98) 487  final 

DOCUMENTS 

EN 

02  05  06  11 

Catalogue  number  :  CB-CO-98-505-EN-C 

ISBN  92-78-38749-5 

Office  for Official  Publications of the European Communities 

L-2985 Luxembourg 

9