Council Regulation (EC) No 1728/1999 of 29 July 1999 imposing a definitive anti-dumping duty on imports of synthetic fibres of polyesters originating in Taiwan and terminating the proceeding in respect of imports of synthetic fibres of polyesters originating in the Republic of Korea
Date: 1999-07-29
Institutions: Council of the European Union
Subjects: South Korea, anti-dumping duty, import, man-made fibre, originating product

4. 8. 1999

EN

Official Journal of the European Communities

L 204/3

I

(Acts whose publication is obligatory)

COUNCIL REGULATION (EC) No 1728/1999

of 29 July 1999

imposing a definitive anti-dumping duty on imports of synthetic fibres of polyesters originating in
Taiwan and terminating the proceeding in respect of imports of synthetic fibres of polyesters
originating in the Republic of Korea

THE COUNCIL OF THE EUROPEAN UNION,

(b) Republic of Korea

Having regard to the Treaty establishing the European
Community,

(2)

Having regard to Council Regulation (EC) No 384/96 of 22
December 1995 on protection against dumped imports from
countries not members of the European Community (1), and in
particular Article 9 and Article 11 thereof,

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

(3)

Whereas:

A. PROCEDURE

1. Previous investigations

(a) Taiwan

(1)

In December 1988 the Council, by Regulation (EEC) No
3946/88 (2); imposed definitive anti-dumping duties on
(hereinafter
imports of synthetic fibres of polyester
in Taiwan.
inter alia,
referred to as ‘PSF') originating,

(4)

the countries concerned,

Subsequently in September 1990, following a request
lodged by the ‘Association of Importers of Synthetic
Polyester Fibres' as well as a request from exporters in
some of
the Commission
initiated a review of Regulation (EEC) No 3946/88, in
accordance with Article 14 of Regulation (EEC) No
2423/88 (3). As a result of this review, in October 1992
the Council, by Regulation (EEC) No 3017/92 (4) modi-
fied the anti-dumping duties in force with respect, inter
alia, to Taiwan.

In January 1993 the Council, by Regulation (EEC) No
54/93 (5)
imposed definitive anti-dumping duties on
imports of PSF originating, inter alia, in the Republic of
Korea (hereinafter referred to as ‘Korea').

(c) Measures in for against other countries

The Council, by Regulation (EEC) No 3017/92, modified
the anti-dumping measures against, inter alia, Romania,
Turkey, the Republics of Serbia and Montenegro and the
former Yugoslav Republic of Macedonia and repealed
the measures on imports from Mexico and the United
States of America. The anti-dumping measures for the
remaining abovementioned countries
lapsed on 23
October 1997. Finally, the Council, by Regulation (EC)
No 1490/96 (6), imposed definitive anti-dumping meas-
ures on imports of PSF originating in Belarus. In conclu-
sion,
the anti-dumping measures presently in force
concern imports originating in Taiwan, Korea and
Belarus.

2. Request for review

Following the publication of two notices of impending
expiry of the anti-dumping measures in force on imports
of PSF originating, inter alia, in Taiwan (7) and, inter alia,
in Korea (8),
in July and
the Commission received,
August 1997 respectively, requests to review the meas-
ures concerning these two countries pursuant to Article
11(2) of Council Regulation (EC) No 384/96 (hereinafter
referred to as the ‘Basic Regulation') in respect of the two
abovementioned countries.

The requests were lodged by the ‘International Rayon
and Synthetic Fibres Committee'
(IRSFC) acting on
behalf of Community producers whose collective output
constitutes a major proportion of the total Community
production of the product concerned.

(1) OJ L 56, 6.3.1996, p. 1. Regulation as last amended by Regulation

(EC) No 905/1998 (OJ L 128, 30.4.1998, p. 18).

(2) OJ L 348, 17.12.1988, p. 49.
(3) OJ L 209, 2.8.1988, p. 1.
(4) OJ L 306, 22.10.1992, p. 1.

(5) OJ L 9, 15.1.1993, p. 2.
(6) OJ L 189, 30.7.1996, p. 13.
(7) OJ C 125, 22.4.1997, p. 4.
(8) OJ C 213, 15.7.1997, p. 4.

L 204/4

EN

Official Journal of the European Communities

4. 8. 1999

(5)

(6)

(7)

(8)

industry. Having

determined,
that

The requests were based on the grounds that the expiry
of the measures would be likely to result in the con-
tinuation or recurrence of dumping and injury to the
after
Community
sufficient
consulting the Advisory Committee,
the
evidence existed for the initiation of a review,
Commission initiated an investigation (1) pursuant
to
Article 11(2) of
the Basic Regulation. Although the
requests for expiry reviews were lodged in the frame-
work of two distinct proceedings they concern imports
of the same product. Therefore both reviews have been
joined for reasons of good administration into one
investigation.

3. Investigation

The Commission officially advised the Community
producers supporting the review request, the exporting
producers, importers and users known to be concerned
as well as the representatives of the exporting countries,
and gave the parties directly concerned the opportunity
to make their views known in writing and to request a
hearing.

The Commission sent questionnaires to the parties
known to be concerned and received replies from eight
Community producers, from four Taiwanese and five
Korean exporting producers. The Commission also sent
questionnaires to a large number of economic operators
understood to be or to represent purchasers, users and
importers of PSF in the Community. Only two user
associations replied.

The Commission sought and verified all information it
deemed necessary for the purposes of a determination of
dumping, injury and Community interest. Verifications
were carried out at the premises of the following compa-
nies:

(a) Exporting producers:

— TAIWAN

— Nan Ya Plastics Corporation, Taipei,

— Shingkong
Taipei,

Synthetic

Fibres Corporation,

— Tuntex Distinct Corporation, Taipei,

— Far Eastern Textile Corporation, Taipei;

— KOREA

— Saehan

Industries

Inc.

(formerly Cheil

Synthetics Textiles Inc.), Seoul,

— Daehan Synthetic Fiber Corporation, Ltd,

Seoul,

— Kohap Ltd, Seoul,

— Samyang Corporation, Seoul,

— Sunkyong Industries Ltd, Seoul;

(b) Community producers:

— Hoechst AG, Frankfurt/Main, Germany,

— Tergal, Gauchy, France,

(1) OJ C 321, 22.10.1997, p. 12.

— Montefibre Spa, Milano, Italy,

— Catalana de Polimers, Barcelona, Spain.

(9)

(10)

The investigation of dumping covered the period from l
October 1996 to 30 September 1997 (hereinafter
referred to as the ‘investigation period' or ‘IP'). The
examination of the situation of the Community industry
covered the period from 1994 up to the end of the
investigation period.

The present review exceeded the period of one year
within which it should normally have been concluded
pursuant to Article 11(5) of the Basic Regulation, due to
the complexity of the investigation, and in particular due
to the difficulties
in obtaining and assessing data
concerning the currency devaluation in the Far East and
its impact on the likelihood of continuation or recur-
rence of injurious dumping.

(11) All parties concerned were informed of the essential
facts and considerations on the basis of which it was
intended to recommend the maintenance of the existing
measures in respect of imports originating in Taiwan
and to terminate the proceeding in respect of imports
originating in Korea. They were also granted a period
within which to make representations subsequent to
these disclosures. The comments of the parties were
considered and, where appropriate, the findings have
been modified accordingly.

B. PRODUCT CONCERNED AND LIKE PRODUCT

1. Description of the product concerned

(12)

The product concerned by this investigation is the same
as in the previous investigations, namely synthetic staple
fibres of polyester, not carded, combed or otherwise
processed for spinning; it is commonly referred to as
polyester synthetic fibres (PSF) and currently classifiable
within CN code 5503 20 00.

This product is a basic material used at various stages of
the manufacturing process of textile goods, depending
on the nature of textiles concerned. Around 60 % of the
Community consumption of PSF is used for spinning,
that is to say manufacturing filaments for the production
of textiles, after mixing or not with other fibres such as
cotton or wool. Approximately 25 % is used for filling,
that is to say the stuffing or padding of certain textile
goods (for example cushions, car seats, jackets) while the
remaining 15 % is used as such for other non-woven
applications, in particular the production of carpets. The
product in question is sold with different quality speci-
fications: the A-grade corresponds to the regular quality,
while the substandard grades are denominated as B and
C-grades. The investigation showed that only the A-
grade quality was exported to the Community. The PSF
producers
types
according to their own criteria, which are mainly based
on its application, thickness and length of the fibre.

classify the product

in different

4. 8. 1999

EN

Official Journal of the European Communities

L 204/5

(13)

requested that non-
Taiwanese exporting producers
woven and special fibres, i.e. PSF having special features,
such as conjugate hollow fibres,
low-melt fibres and
black fibres should be considered as a product different
from the above defined product and excluded from the
scope of the present investigation.

However, the investigation showed that, although there
are several types of PSF having various features in order
to meet specific needs, they have the same basic physical
characteristics. In addition, the market of this product is
in fact formed by overlapping series of PSF types with
no clearly defined boundaries between them.

Accordingly, it was found that any one specific feature
did not render the allegedly special PSF different and
that, therefore, they all should be covered by the scope
of the present proceeding.

All types of PSF were therefore considered as one single
product for the purpose of this investigation.

C. DUMPING AND LIKELIHOOD OF RECURRENCE OF
DUMPING

1. Preliminary remarks

(16)

In accordance with Article 11(2) of the Basic Regulation,
the purpose of the present review was to determine
whether or not the expiry of the measures would lead to
a continuation or recurrence of dumping, in particular
by examining whether dumping continued to take place
after the adoption of anti-dumping measures.

(a) Taiwan

(17) Out of the five Taiwanese exporting producers who
replied to the questionnaire, one declared no exports to
the Community for the investigation period and stated
its availability to cooperate in the investigation. More-
over two exporting producers, Tuntex Distinct Corpora-
tion and Shingkong Synthetic Fibres Corporation, had
exports to the Community for less than 100 tonnes each
during the investigation period. Given the low volume of
the exports made by these two Taiwanese companies
and hence the lack of representativeness of their corres-
ponding export prices, it has not been considered appro-
priate to calculate, on this basis, the dumping margin for
these two companies.

2. Like product

(b) Korea

(14)

(15)

The investigation showed that the various types of PSF
manufactured and sold on the Taiwanese and Korean
market, despite minor differences in length, thickness or
quality, were alike to the PSF types exported from these
countries to the Community, in the meaning of Article
1(4) of the Basic Regulation.

Taiwanese exporting producers alleged that their exports
consisted mainly of non-woven or specialty fiber which
are not widely produced by the Community industry
and clearly differ in all aspects from the PSF produced by
the Community industry, which allegedly consists
mostly of regular spinning and hollow fibres. The invest-
igation has shown that specialty fibres represent only a
minor part of Taiwanese exports to the Community,
while the vast majority of these exports consist of spin-
ning and hollow fiber. Moreover, there is also significant
Community production of specialty and non-woven
fibres. In any event, as stated in recital 13 it has been
established in this investigation that non-woven and
specialty fibres form a single product together with the
rest of the PSF types.

Consequently, the PSF types exported from Taiwan and
Korea to the Community were alike to the PSF types
produced by the Community producers and sold within
the Community market in the meaning of Article 1(4) of
the Basic Regulation.

(18) All five Korean exporting producers who replied to the
questionnaire had made significant exports of PSF to the
Community in the investigation period.

2. Normal value

(a) Taiwan

(19)

For the reasons given in recital 17, normal values have
been established only for
two Taiwanese exporting
producers, which accounted for virtually the totality of
the Taiwanese exports of PSF to the Community during
the investigation period. In both cases, normal value has
been determined for each type of PSF produced by the
companies in question and exported to the Community.

In the case of one exporting producer normal value per
product type was entirely based on the prices paid in the
ordinary course of trade by independent customers in
the domestic market with regard to sales made in repres-
entative quantities, in accordance with Article 2(1) and
2(2) of the Basic Regulation.

For the other exporting producer it was found that there
were no or insufficient domestic sales of the like product
in respect of some types of PSF exported to the
Community. In these cases, and since prices of the other
cooperating exporting producer could not be used,
normal value was constructed on the basis of the costs
of manufacturing of these types of PSF plus a reasonable

L 204/6

EN

Official Journal of the European Communities

4. 8. 1999

amount for selling, general and administrative cost and
for profit,
in accordance to Article 2(3) of the Basic
Regulation. In order to determine the reasonable amount
for selling, general and administrative cost and for profit
the actual data pertaining to production and sales, in the
ordinary course of trade, of the like product by this
exporting producer have been used, in accordance with
Article 2(6) of the Basic Regulation. Normal value for
the remaining exported product types was based on the
prices paid in the ordinary course of trade by independ-
in accordance
ent customers in the domestic market,
with Article 2(1) and 2(2) of the Basic Regulation, since
domestic sales both overall and for the types in question
were made in representative quantities.

(b) Korea

(20) Normal value was based on the prices paid in the or-
dinary course of trade by independent customers in the
domestic market with regard to sales made in repres-
entative quantities, in accordance with Article 2(1) ) and
2(2) of the Basic Regulation. For product types which
were not sold in representative quantities or not in fine
ordinary course of trade on the domestic market, the
normal value has been constructed in accordance with
Article 2(3) of the Basic Regulation since prices of other
cooperating exporting producer could not be used. In
this respect, selling, general and administrative costs and
profits have been established in accordance to Article
2(6) of the Basic Regulation in the same way as for
Taiwan.

3. Export price

(21)

For exporting producers from both countries export
prices were established on the basis of the prices actually
paid by independent buyers in the Community in
accordance with Article 2(8) of the Basic Regulation.

(24)

4. Comparison

(22)

For the purpose of ensuring a fair comparison between
normal value and export price, account was taken of
differences in factors which were claimed and demon-
strated to affect comparability in accordance with Article
2(10) of the Basic Regulation. In this respect, adjust-
ments were made for inland and ocean freight, insur-
ance, handling, loading and ancillary costs, credit costs,
commissions and import charges.

Two Taiwanese exporting producers
submitted and
demonstrated that a quantity discount was granted to
the domestic customers buying more than a certain
volume of PSF per year. These exporting producers
alleged that all Community customers benefited from
the same discount, though not indicated in the invoice,
by reason of their purchase quantities in excess to the
quantity above which a discount was granted. Therefore,
to ensure a fair comparison, an adjustment corre-
sponding to the discount granted to the large domestic

customers has been claimed for the small domestic
customers.

it was

In this respect, it is noted that an adjustment for quant-
ities pursuant to Article 2(10)(c) of the Basic Regulation
can only be granted in respect of any price reductions
actually given for the purchase of different quantities.
Moreover,
found that not all Community
customers purchased a quantity of the product in ques-
tion in excess to that which would have entitled to the
quantity discount during the investigation period. On
the contrary,
to small
the share of export
customers in the Community was very close to that of
domestic sales to small customers, which indicates that
both the domestic and the export market, have a similar
pattern in terms of customers. Consequently, only the
allowance for the quantity discount which was actually
granted by the exporting producers
large
domestic customers is justified in view of a fair compar-
ison.

to their

sales

5. Dumping margin

(23)

The weighted average normal value per type of PSF was
compared to the weighted average export price of the
in accordance with Article 2(11)
corresponding type,
of-the Basic Regulation, on an ex-work basis and at the
same level of trade.

The comparison showed the existence of dumping for
the two Taiwanese and for four of the Korean exporting
producers investigated, the dumping margin being equal
to the amount by which normal value, so established,
exceeded the price for export to the Community.

The weighted average dumping margin, as a percentage
of the CIF Community-frontier import price, is signifi-
cant for the two Taiwanese exporting producers, Far
Eastern Textile Corporation and Nan Ya Plastics
Corporation, covering virtually the total of the Taiwa-
nese exports to the Community. Given the pricing policy
followed by the two exporting producers in question it
can be concluded that dumping would continue or even
increase if the measures would be removed. No dumping
margin has been calculated for the other three co-oper-
ating Taiwanese exporting producers for the reasons
given in recital 17. However, the Commission examined
the likelihood of dumping to recur in case the measures
were removed. On the basis of the information received
from two of the Taiwanese companies representing the
great majority of the total sales volume,
it has been
found that their exports to countries other than the
Community are made at dumped prices. As these
exports represent the major part of these companies’
sales, it can be concluded that given their pricing policy
for exports, dumped exports to the Community market
are likely to resume should the measures lapse.

(25)

Taiwanese exporting producers
submitted that any
margin of dumping is offset by the devaluation of the
the USD which
Taiwanese currency (NT$) against
occured after the investigation period.
It was further
alleged that the level of the NT$ against the USD in the

4. 8. 1999

EN

Official Journal of the European Communities

L 204/7

first quarter 1998 is expected to remain stable for the
coming years and that the decrease of the price in USD
of PTA, the main raw material for the production of PSF
which the companies concerned buy in USD, has more
than compensated for the depreciation of the Taiwanese
currency against the USD.

The issue was examined. Indeed the depreciation of the
NT$ against the USD,
i.e. the currency in which the
export prices to the Community are generally denomi-
nated, amounted to almost 17 % during the first quarter
of 1998 in respect of the average found during the
investigation period. However, a recovery of the NT$
was observed in the rest of 1998 so that the deprecia-
tion recorded at the beginning of 1999 was limited to
14 %. Moreover, in the year 2000 a further reduction of
the depreciation to less than 10 % (as compared to the
level prevailing in the investigation period) is expected
according to financial
submitted by the
exporting producers. According to the same forecasts
this recovery trend of the NT$ is poised to continue in
the following years. Hence, given the fluctuating nature
of
the argument put
forward by the Taiwanese exporting producers cannot
be accepted. In any event, it has to be noted that by the
very nature of exchange rate changes these can not be
foreseen with any reliability and changes that have
occurred in the past are not necessarily a guide to the
future.

the depreciation of

the NT$,

forecasts

(26) With regard to Korea, the following should be noted: the
measures under review are based on dumping margins
determined in the previous investigation and these
margins, with the exception of the residual dumping
margin, would be considered as de minimis under the
current Basic Regulation. The level of
the original
margins was low and that situation has not changed.
Indeed,
the weighted average
dumping margin established, expressed as a percentage
of the cif Community frontier import price, was 1,8 %.
Finally, no indication was found-that the removal of the
existing measures would lead to a change of this situa-
tion in the foreseeable future. It was therefore concluded
that there was no likelihood of recurrence of dumping.

investigation,

in this

D. COMMUNITY INDUSTRY

(27)

Two of the nine Community producers supporting the
review request did not cooperate during the the invest-
igation. The investigation showed that the share of the
total Community production held by the seven co-oper-
ating Community producers
supporting the review
request, during the investigation period amounted to
more than 65 % of total Community production of the
product concerned. Therefore, these producers constitute

the Community industry within the meaning of Article
4(1) of the Basic Regulation. Hereinafter, these co-oper-
ating Community producers are referred to as the
‘Community industry'.

E. ANALYSIS OF THE SITUATION IN THE COMMUNITY
MARKET

1. Consumption in the Community

(28)

Community consumption was based on the combined
volume of sales into the Community market of the
Community industry, sales of the remaining non-coop-
erating Community producers and Eurostat information
on volume of total imports. The volume of sales of the
Community
the
not
proceeding was determined, on the basis of available
information, at around 30 % of the total sales of all
Community producers.

co-operating

producers

in

On the above basis, Community consumption of PSF
followed overall a slight decreasing tendency over the
period considered:
from 540 000 tonnes in
1994 to 490 000 tonnes in 1995 and, after a temporary
fall back to 460 000tonnes in 1996, to 520 000 tonnes
during the investigation period, which represents an
overall decrease of 3 % over the period considered.

it went

2. Imports in the Community from Taiwan and
Korea

(a) Imports from Korea

(29)

It was concluded that the situation on the Community
PSF market with respect to imports originating in Korea-
should not be analysed, due to the conclusion reached
on dumping and likelihood of recurrence of dumping
with regard to these imports.

(b) Volume, value and market share of imports from Taiwan

(30)

The volume of imports from Taiwan increased from
around 8 000 tonnes in 1994 to around 27 000 tonnes
during the investigation period, representing an increase
of around 240 %. The value of imports from Taiwan
increased from ECU 9,9 million in 1994 to ECU 29,3
million during the investigation period, representing an
increase of 196 %.

In terms of market share, based on total Community
consumption, the market penetration of the dumped
imports from Taiwan rose from 1,5 % to 5,3 during the
investigation period in volume terms — an increase of
253 %.

L 204/8

EN

Official Journal of the European Communities

4. 8. 1999

(c) Prices of imports from Taiwan

(31)

Prices of the imports from Taiwan decreased from 1994
to the investigation period by 14 %. It should be noted
that these prices were found to be lower than those of
the Community industry over the whole period consid-
ered.

(32)

(33)

(d) Price undercutting of imports from Taiwan

For the determination of price undercutting, data refer-
ring to the investigation period were analysed. Price
undercutting was established on the basis of a compar-
ison of the export price with prices charged by the
Community industry at the same level of trade. The sales
prices of the Community industry considered were those
to independent customers, adjusted where necessary to
an ex-works level, i.e. excluding transport costs. Adjust-
ments were made to the exporting producers’ selling
prices (cif Community frontier)
to take account of
customs and anti-dumping duty paid: All prices were
compared after excluding discounts and rebates.

The results of the comparison (on a weighted-average to
weighted-average basis)
from
Taiwan a weighted average price undercutting margin,
expressed as a percentage of the Community industry’s
average selling prices, of 167 %.

showed for

imports

This is to be compared with the undercutting found in
the previous investigation which ranged from 22 % to
30 % for Taiwan.

production facilities of a number of companies of the
Community industry. This represents an overall decrease
of 8 %. Production levels decreased at a higher rate than
Community consumption; which decreased by 3 %
during the period considered.

(36) As regards capacity, it should be noted that the produc-
tion facilities for PSF are also used in the production of
other products not concerned by the present proceed-
ings, e.g. tow and tops. As a consequence, the capacity
normally attributed to the production of the product
concerned by the Community industry was estimated. It
was found that capacity decreased from 432 300 tonnes
in 1994 to 401 500 tonnes during the investigation
period, which represents a decrease of 7 %. This is
broadly in line with the reduction of production as
outlined in the preceding recital. The rate of capacity
utilisation decreased slightly during the period consid-
ered going from 86,6 % in 1994 to 85,7 % in the invest-
igation period.

(c) Sales volume of the Community industry

(37)

The volume of sales of the Community industry on the
Community market decreased during the period consid-
ered, with the sales levels at 330 000 tonnes in 1994
and 295 000 tonnes in the investigation period. This
represents an overall decrease of 11 %. This trend shows
that the sales of the Community industry did not follow
the trend in consumption, which decreased by 3 during
the period considered.

The exporting producers’ undercutting level, on an
average basis, remained important, despite a certain
upward effect on import prices of
the antidumping
measures in force.

(38)

3. Economic situation of the Community industry

(a) Preliminary remarks

(34)

The examination of the situation of the Community
industry covers the period from 1994 to the end of the
investigation period. It should be noted that during this
period anti-dumping measures as mentioned in recital 1
and following were in force with a resulting effect on the
Community industry.

(d) Market share

The development of sales volume compared to that of
Communit consumption shows that the market share
held by the Community industry decreased during the
period considered. The market share of the Communit
industry decreased from 61 % in 1994 to 60 % in 1995,
59 % in 1996 and 56 % in the investigation period. The
overall loss of market share was five percentage points
between 1994 and the investigation period.

(e) Stocks

(39)

Stocks significantly increased by 33 % between 1994
and the investigation period.

(b) Production, capacity and capacity utilisation

(f) Average sales price and price evolution

(35)

Production of the Community industry decreased during
the period considered, going from around 374 000
tonnes in 1994 to around 343 000 tonnes in the invest-
igation period. This decrease reflected the closure of

(40)

The weighted average prices of the product concerned
sold by the Community industry on the Community
market
the period considered, and
fluctuated over
overall they increased by 3 %.

4. 8. 1999

EN

Official Journal of the European Communities

L 204/9

It should be noted that prices of PSF have been influ-
enced for all operators on the market by the evolution
of prices of the basic raw materials like pure terephthalic
acid (PTA), dimethylterephthalate (DMT) and glycol,
representing about 60 to 70 % of the cost of production
Indeed, essentially, due to a
of the finished product.
worldwide shortage of these raw materials, starting at
the end of 1993 and continuing into 1994 and 1995
prices increased, reflected in a corresponding increase in
the cost of production. Nevertheless, the trend experi-
enced for the prices of these raw materials reversed from
1995 onwards.

(g) Profitability

(41)

In 1994, the Community industry incurred a weighted
average loss of 3,5 %, expressed as a percentage of net
sales. Subsequently,
the financial situation improved,
especially during 1995 (profit of 7,5 %). This resulted
partially from the fact
that all operators on the
Community market were able to raise their prices after
an increase in the raw material costs (see recital 40), and
the Community industry could improve its financial
situation due to a reduction in overhead costs. It should
be noted however, that the Community industry showed
a downward trend of its financial results, from 1995
onwards, going from a profit of 7,5 % to a profit of
5,6 % in the investigation period.

(h) Investment

(42)

Yearly investments made by the Community industry
were important during the period under investigation,
going from ECU 58 million in 1994, to ECU 44 million
in 1995, with a peak in 1996 of ECU 81 million.
During the investigation period investment amounted to
ECU 14 million. It should be noted that this significant
effort represents,
investments in
for the most part,
replacement machinery as part of an overall-restruc-
turing pogram.

(i) Employment

(43) Due to a certain degree of reduction in production
capacity and restructuring, employment went down
from around 2 300 in 1994 to around 2 000 during the
i.e. by 9,2 %.
investigation period,

4. Conclusion on the situation of the Community

industry

(44)

The above analysis has revealed that the economic in-
dicators such as production, capacity utilisation, sales
and stocks continued to show negative trends. Although
this has to be seen in the context of slightly contracting

it has to be borne in mind that

the
consumption,
Community industry lost market
share during this
period. Furthermore, the investigation has shown that
the Community industry has suffered significant price
pressure and substantial price undercutting has been
established for imports originating in Taiwan.

(45) As far as the financial situation of

the Community
it should be noted that profits
industry is concerned,
were made in 1995 after the increase of the prices of the
raw material and the initiation of an anti-dumping
investigation against imports from Belarus. Nevertheless,
the Community industry showed a downward trend of
its financial results from 1995 onwards, coinciding with
the increased presence of imports from Taiwan filling
the vacuum left by imports from Belarus.

(46)

In the light of the foregoing analysis, it was concluded
that the Community industry has continued to be in a
weak economic situation.

F. LIKELIHOOD OF RECURRENCE OF INJURY

(47)

(48)

(49)

Further to the analysis of the existence of dumping as
well as the likelihood of recurrence of dumping with
respect to imports originating in Taiwan and the analysis
it was
of
examined whether there was a likelihood of recurrence
of injury, should the measures applicable to the imports
from Taiwan be removed.

the Community industry,

the situation of

1. Analysis of

the situation of

the exporting

country producers concerned

It has been found that from 1995 to the investigation
period total production capacity in Taiwan has increased
by 21,3 % i.e. 135 000 tonnes. Taiwanese exporting
producers foresee to further increase their production
capacity and capacity utilization to a level above 90 % in
1998,
leading to a further increase of production of
30 000 tonnes.

It was also found that the volume of imports originating
in Taiwan increased substantially between 1994 and the
investigation period (+242 %), despite the anti-dumping
measures in force.
It should be noted that, between
1995 and 1996, the volume of these imports into the
Community almost doubled and between 1994 and the
investigation period more than tripled. The corre-
sponding market share increased significantly between
1994 and the investigation period from 1,5 % to 5,3 %.
Furthermore,
it has been established that during the
investigation period these imports were made at prices
significantly
the
Community industry.

undercutting

(167 %)

those

of

L 204/10

EN

Official Journal of the European Communities

4. 8. 1999

2. Impact of imports from Taiwan in the absence of

anti-dumping measures

the existing antidumping measures in respect of Taiwan
should be maintained to avoid a recurrence of injurious
dumping.

(50)

(51)

Concerning the recurrence of injurious dumping, it was
considered that the prices obtained in the absence of
anti-dumping measures would lead to a price undercut-
ting of 24,5 %. The methodology used in order to calcu-
late this figure was the same as that described in recital
32 except that no anti-dumping duty was added to the
import price.

In the light of the above it is expected that imports
from- Taiwan into the Community will further increase
and their prices fall should the anti-dumping measures
in force be removed. It was established that even with
measures in force the volume of Taiwanese imports
increased. Furthermore, it cannot be excluded that, in
the absence of measures, the relatively higher price in
the Community market would constitute an incentive to
redirect exports from Taiwan which at present are
shipped to other third countries, into the Community
market.

(52) As far as the profitability level of

First,

imports originating in Taiwan.

the Community
industry is concerned, two basic hypotheses can be fore-
that anti-dumping measures lapse
seen in the event
against
the
Community industry would continue to sell at the same
prices, resulting in a decrease of its market share with
direct consequences, in the long run, on its profitability.
Second, the Community industry will drop its prices for
some of its sales, where the competition of Taiwan will
be most intense, resulting in a decrease of its profit-
ability. It has been estimated that in the first scenario the
Community industry would further lose 2,5 % market
share, accompanied by a drop in profitability of 9,5 % in
the short term. If the Community industry followed the
downward trend on prices, profitability would drop
from 5,6 % to 2,7 %. Consequently, in each scenario the
profitability of the Community industry would suffer
from dumped imports originating in Taiwan causing
injury.

3. Conclusion on recurrence of injurious dumping

(53) During the period under investigation prices of dumped
imports from Taiwan decreased by 14 %, in a period of
time when Community’s industry prices increased by
3 %. This had the effect that the market share of imports
from Taiwan increased from 1,5 % in 1994 to 5,3 % in
the investigation period,
i.e. by 253 %. Furthermore,
when imports from Taiwan started to fill the vacuum
left by Belarus, the financial situation of the Community
industry took a downward turn.

(54)

The significant production capacities, some of them only
recently installed,
in Taiwan, the attractiveness of the
prices prevailing on the Community market and the
consequent risk of an export drive clearly suggest that

G. COMMUNITY INTEREST

1. Introduction

(55)

It should be recalled that in the previous investigations,
the adoption of measures was considered not to be
against the interest of the Community. Furthermore, it
should be noted that
investigation is a
review, thus analysing a situation in which anti-dumping
measures have already been in place. Consequently, the
timing and nature of the present investigation allows an
assessment of any negative undue impact on the parties
concerned by the anti-dumping measures imposed.

the present

injurious dumping,

On this basis it was examined, whether, despite the
conclusions on a likelihood of a continuation and recur-
rence of
it could be clearly be
concluded that it is not in the Community interest to
maintain measures in this particular case. For
this
purpose, and pursuant to Article 21(1) of the Basic
Regulation,
for all parties
involved in the proceeding and also the consequences of
not maintaining measures against Taiwan was consid-
ered.

the impact of measures

2. Interest of the Community industry

(56)

The Community industry has for almost a decade been
suffering from low priced/dumped imports of PSF. The
objective of the anti-dumping measures under review, to
re-establish fair competition in the Community market
between the Community producers and their exporting
counterparts in third countries, has not been fully met as
it has been shown above.

The Community industry has been making considerable
efforts to improve its productivity in recent years, in an
attempt to lower its cost of production and to enhance
its competitiveness in this price sensitive market. The
Community industry deployed particular efforts of ratio-
nalisation
period. One
Community producer shut down two production facili-
ties in an effort to reduce costs and to improve its
productivity.

investigated

during

the

In view of the situation of the Community industry, in
particular the fact that it was prevented from fully recov-
ering from the economic difficulties resulting from
dumped imports, it is considered that, in the absence of
measures, the further deterioration of the situation of
the Community industry is quite probable. This could
entail a severe reduction in employment and may ulti-
mately lead to a reduction of the number of producers
in the Community.

4. 8. 1999

EN

Official Journal of the European Communities

L 204/11

Furthermore, the ongoing restructuring efforts made by
the Community industry show that it is not ready to
abandon this segment of production. The maintaining of
anti-dumping measures would therefore be in the
interest of the Community industry.

4. Consequence for competition in the Community

market

(60)

It has been claimed that the level of competition on the
Community PSF market would be affected by the contin-
uation of the anti-dumping duty since it would create a
stronger position for the Community industry.

3. Impact on users

(57) No Community user answered to the questionnaire sent
by the Commission during the current investigation. No
evidence was provided on the incidence of the measures
in force, in their cost of production. Consequently, no
analysis could be carried out concerning the impact of
the measures in force on the cost of production of users.

(58)

(59)

it

Two Community user associations submitted informa-
tion and requested the termination of the measures. In
this submissions it was argued that
the Community
industry was not able to meet the demand. Moreover,
certain users of one type of PSF, i.e. fiberfill, informed
the Commission that the major Community producer of
this type was not in a position to meet their needs.
Nevertheless,
shortage
occurred on the Community market during the period
examined. The aim of anti-dumping measures is not to
foreclose the Community market
from imports, but
rather to level the unfair trade practices and to prevent
the distorting effects of dumped and injurious i/nports.
In this specific case, it seems that the measures did not
prevent imports to enter the Community market. As it
was already mentioned imports from Taiwan increased
significantly during the period under investigation.

that no particular

seems

Furthermore, it was found that, in view of the fact that
the Community industry has a significant production
capacity, and given the presence of other suppliers
located outside of the Community, the risk of a general
supply shortage is very low,

if not non-existant.

Furthermore, some interested parties argued that the
international competitive position of products incorpor-
ating PSF, produced in the Community, is jeopardised by
the continuation or re-imposition of the anti-dumping
measures. This argument cannot be accepted because
PSF used for the production in the Community of prod-
ucts for export can enter the Community without any
duty under the inward processing arrangements. More-
over, these interested parties had the opportunity, due to
the fact that the anti-dumping measures under review
are in force for at least five years, to submit evidence
about the incidence of the measures on their cost of
production and their international competitiveness, but
no information in this respect was received.

as

far

the

competitive

environment

As
in the
Community market is concerned, the measures in force
are not such as to foreclose the Community market to
the exporting producers under review. Therefore, they
will allow the continued presence of these exporting
producers in the market. It should be recalled that the
industries and other economic operators have
user
always enjoyed the presence of a wide range of competi-
tors in the market.

Thus, the benefit of a market driven by a number of
suppliers would still be available for users of the product
concerned.

5. Conclusion

and

(61) On the basis of the above facts and considerations in
particular,
arguments
submitted by the Community industry and users associa-
tions of the product concerned, it was concluded, that
there were no compelling reasons not to maintain the
measures in force concerning imports from Taiwan.

examined

having

the

(62)

(63)

H. TERMINATION OF THE PROCEEDING IN RESPECT
OF KOREA

In view of the findings set out above in recital 26, the
anti-dumping measures currently in force against Korea
are no longer warranted. In accordance with Article 11
in conjunction with Article 9 of the Basic Regulation,
where,
are
unnecessary and there is no objection raised within the
Advisory Committee,
the investigation or proceeding
shall be terminated.

consultation, protective measures

after

In the light of the above, the Commission has concluded
that the continuation of protective measures currently in
force
the
proceeding should be terminated

is unnecessary and that

against Korea

I. ANTI-DUMPING MEASURES

(64)

It follows from the above that, as provided for by Article
11 (2) of the Basic Regulation, the anti-dumping duties
on imports of PSF originating in Taiwan imposed by
Regulations (EEC) No 3017/92 should be maintained,

HAS ADOPTED THIS REGULATION:

Article 1

On the basis of the above, and since the measures have
been in place for a certain period, and would be main-
tained at the same level, it can be concluded that this
would not imply a deterioration, if at all, of the situation
of the users.

1.
A definitive anti-dumping duty is hereby imposed on
imports of synthetic fibres of polyesters, not carded, combed or
otherwise processed for spinning, currently classifiable within
CN code 5503 20 00 and originating in Taiwan.

L 204/12

EN

Official Journal of the European Communities

4. 8. 1999

The duty, calculated on the basis of the net free-at-Community-frontier price of the product; before
2.
duty, shall be 13 % for synthetic fibres of polyesters originating in Taiwan (additional taric code 8195),
except for synthetic fibres of polyesters produced by the companies listed below, to which the following
rates shall apply:

— Far Eastern Textile Ltd, Taipei
(additional taric code 8192)

— Nan Ya Plastics Corporation, Taipei

(additional taric code 8193)

— Shingkong Synthetic Fibres Co., Taipei

(additional taric code 8194)

6,8 %

5,9 %

13,0 %

The anti-dumping proceeding concerning imports of synthetic fibres of polyesters originating in the
Republic of Korea is hereby terminated.

Article 2

Unless otherwise specified, the provisions in force concerning customs duties shall apply.

Article 3

This Regulation shall enter into force on the day following is publication in the Official Journal of the
European Communities.

Article 4

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

Done at Brussels, 29 July 1999.

For the Council

The President

S. HASSI