Council Regulation (EC) No 174/2000 of 24 January 2000 repealing Council Regulation (EEC) No 3433/91 insofar as it imposes a definitive anti-dumping duty on imports of gas-fuelled, non-refillable pocket flint lighters originating in Japan
Date: 2000-01-24
Institutions: Council of the European Union
Subjects: Japan, anti-dumping duty, import, non-durable goods, originating product, tobacco industry

L 22/16

EN

Official Journal of the European Communities

27. 1. 2000

COUNCIL REGULATION (EC) No 174/2000

of 24 January 2000

repealing Council Regulation (EEC) No 3433/91 insofar as it imposes a definitive anti-dumping duty
on imports of gas-fuelled, non-refillable pocket flint lighters originating in Japan

THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty establishing the European
Community,

Having regard to Council Regulation (EC) No 384/96 of 22
December 1995 on protection against dumped imports from
countries not members of the European Community (1), and in
particular Article 11(6) thereof,

Having regard to the proposal submitted by the Commission,

Whereas:

(1)

(2)

(3)

A. PROCEDURE

1. Measures in force

the ‘definitive duty Regulation’,

By Regulation (EEC) No 3433/91 (2), hereinafter referred
the Council
to as
imposed a definitive anti-dumping duty on imports of
gas fuelled, non-refillable pocket flint lighters originating
in Japan, the People's Republic of China, the Republic of
Korea and Thailand. As regards Japan, the duty rate was
set at 35,7 %.

The definitive duty Regulation was amended with
respect to China in 1995 by Regulation (EC) No 1006/
95 (3). Insofar as Thailand is concerned, it was replaced
by Regulation (EC) No 423/97 in March 1997 (4).

2. Initiation of a review

In May 1996 the Commission published a notice of the
impending expiry of the measures in force concerning
Japan and the Republic of Korea (5). After this publica-
tion, the Commission received a request for a review
pursuant to Article 11(2) of Regulation (EC) No 384/96,
hereinafter referred to as the ‘Basic Regulation’, with
regard to imports of gas-fuelled, non-refillable pocket
flint lighters originating in Japan, lodged by the Euro-
pean Federation of Lighter Manufacturers on behalf of
BIC S.A. and Flamagas S.A. Subsequently this request
received the support of Swedish Match S.A. BIC S.A.,
Flamagas S.A. and Swedish Match S.A. represent almost
the totality of Community production of the product
concerned.

(4)

The request contained sufficient prima facie evidence
that the expiry of measures would be likely to result in a
recurrence of dumped imports causing injury. Evidence

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

(EC) No 905/98 (OJ L 128, 30.4.1998, p. 18).

(2) OJ L 326, 28. 11. 1991, p. 1. Regulation as last amended by Regu-

lation (EC) No 423/97 (OJ L 65, 6.3.1997, p. 1).

(3) OJ L 101, 4.5.1995, p. 38.
(4) OJ L 65, 6.3.1997, p. 1.
(5) OJ C 155, 30.5.1996, p. 6.

(5)

(6)

(7)

(8)

(9)

of the presence of under-utilised capacity in Japan as
well as evidence that imports from Japan would have an
the
immediate depressing effect on the prices of
Community producers supported this alleged likelihood.
It was further alleged that this situation would exacer-
bate the continuing vulnerability of
the Community
industry.

Therefore, the Commission announced the review of the
definitive duty Regulation in respect of Japan (6). This
review was opened in accordance with Articles 11(2)
and 11(3) of the Basic Regulation, as an interim review
also seemed to be appropriate. As regards Korea, the
measure expired (7).

3. Review investigation

The Commission officially advised the only producer in
the exporting country known to be concerned, Tokai
its related importer in the Community,
Corporation,
Tokai Seiki GmbH, the representatives of the exporting
country and the complainants.

The parties directly concerned were given the oppor-
tunity to make their views known in writing and to
request a hearing. One of the complainants requested
and was granted a hearing.

to all parties
The Commission sent questionnaires
known to be concerned and received detailed informa-
tion from the complainant Community producers, their
subsidiaries,
related
importer located in the Community.

exporter and its

Japanese

the

The Commission sought and verified all information it
deemed necessary for the purpose of, the investigation
and carried out verifications at
the
following companies:

the premises of

Community producers and their subsidiaries

— BIC S.A. (the BIC group), Clichy, France,

— BIC BJ 75, Redon, France,

— BIC Deutschland GmbH & Co., Ettlingen, Germany,

— BIRO BIC Ltd, London, UK,

— Laforest BIC S.A., Tarragona Spain,

— Swedish Match Lighters B.V., Assen, Netherlands,

— Swedish Match Lighters
Rillieux-la-Pape, France,

(including Cricket SA),

— Arnold André GmbH & Co., KG, Bünde, Germany,

— Flamagas S.A., Barcelona and Llinas del Valle, Spain.

(6) OJ C 361, 30.11.1996, p. 3.
(7) OJ C 360, 29.11.1996, p. 2.

27. 1. 2000

EN

Official Journal of the European Communities

L 22/17

Producer in the country of origin

— Tokai Corporation Japan, Tokyo, Japan.

(10)

(11)

(12)

For the purpose of the dumping, injury and Community
interest determinations, the geographical scope of the
investigation was the Community of 15.

The investigation of dumping covered the period from 1
January 1996 to 30 September 1996 (hereinafter
referred to as the ‘investigation period’). The examination
of injury covered the period from 1992 up to the end of
the investigation period.

The investigation exceeded the normal
time period
provided for in Article 11(5) of the Basic Regulation.
This was due to the fact that the Commission considered
that the data gathered and examined initially were not
sufficient to be used as a basis for a new anti-dumping
duty and that, for an accurate assessment of the likeli-
hood of recurrence of injurious dumping, a verification
visit to the exporter had to be carried out at an advanced
stage of the investigation. Moreover, the investigation
was extended considerably by the Commission's two
initial proposals to maintain the anti-dumping duty
giving rise to lengthy deliberations in the Council.

B. PRODUCT CONCERNED AND LIKE PRODUCT

1. Product concerned

was no longer appropriate. In particular, it did not show
any changes in the (basic) technical characteristics, such
as the ignition system, of either type of lighters, which
could have invalidated the findings of the definitive duty
Regulation.

(16) As the evidence that was presented was insufficient to
justify the inclusion of electronic lighters in the invest-
igation, and the request was made belatedly by a party
that had supported the request for a review without
reservation, the request for an extension of the scope of
the review investigation could not be granted.

Different sizes and models

(17)

it should be noted that

Finally,
the product under
consideration is manufactured in different sizes and
models. All these disposable flint lighters have the same
basic technical characteristics and the
same basic
application, and perform the same function. As in
previous investigations, the whole range of models of
disposable flint lighters was, therefore, considered as
forming one single category of product.

2. Like product

(18) As regards the disposable flint lighters produced and
sold domestically in Japan, the investigation showed that
such products were in all respects identical to, or closely
resembling, those exported to the Community from the
country in question.

(13)

The products under consideration are gas-fuelled, non-
refillable pocket flint lighters (hereinafter referred to as
falling within CN code
flint
‘disposable
ex 9613 10 00.

lighters’)

(19)

Request for inclusion of other lighters

(14)

It should be recalled in this respect that there are other
disposable lighters on the market (so-called electronic or
piezo lighters) which are not subject to anti-dumping
measures. Two months after the opening of the review
investigation, Swedish Match S.A. made a request to
extend the scope of this review investigation to elec-
tronic (or piezo) lighters arguing that gas-fuelled, non-
refillable pocket flint lighters and gas-fuelled, non-refil-
lable electronic lighters (hereinafter ‘electronic lighters’)
formed one single category of the product.

(15) As regards this request, it should be recalled that the
proceeding — opened in April 1990 — concerns gas-
fuelled, non-refillable pocket flint lighters and that it has
already been assessed (see in particular Regulation (EEC)
No 3433/91 which confirms the provisional findings
laid down in recital 11 to Council Regulation (EEC) No
1386/91 (OJ L 133, 28.5.1991, p. 20)) that the (basic)
technical characteristics of electronic lighters were quite
different
lighters
currently subject to anti-dumping duties. The request did
not contain any evidence showing that this conclusion

the disposable flint

from those of

The investigation also established that the disposable
flint lighters imported from the country concerned, on
the one hand, and those produced by the Community
industry and sold in the Community market, on the
other hand, possess similar basic technical characteristics
and are intended for the same use. The disposable flint
lighters produced and sold by the Community industry
should therefore be regarded as like products to those
imported from the country concerned.

(20) Accordingly, it was concluded that the disposable flint
lighters produced and sold in the Community, as well as
those produced and sold in Japan should be regarded as
like products, within the meaning of Article 1(4) of the
Basic Regulation, to those exported to the Community
from Japan.

C. DUMPING

1. Normal value

sole

(21) As in the original investigation, Tokai Corporation was
the
cooperating exporting Japanese producer.
During the investigation period it sold 20 different
models of
the product concerned on its domestic
market. Only two of those models were exported to the
Community.

L 22/18

EN

Official Journal of the European Communities

27. 1. 2000

(22)

(23)

(24)

It was found that this exporter's overall domestic sales of
the product concerned during the investigation period
were representative since the total volume of such sales
exceeded the threshold of 5 % of export sales provided
for in Article 2(2) of the Basic Regulation. Domestic
sales of each of the two product models exported to the
Community were also representative because they met
the same 5 % criterion.

In accordance with Article 2(4) of the Basic Regulation,
the Commission also had to determine whether
domestic sales of each model were made in the ordinary
course of trade by looking at the proportion of profit-
able sales to total sales. The investigation showed that all
domestic sales made during the investigation period
were profitable. Consequently, normal value was based
on the average weighted sales price of all domestic
transactions of the two models in question.

2. Export price

The totality of the export sales made by the exporter
concerned during the investigation period was made to a
related company in the Community. The export prices
were therefore constructed, in accordance with Article
2(9) of the Basic Regulation, on the basis of resale prices
to the first independent buyer adjusted to take account
of all costs incurred between importation and resale
including customs and anti-dumping duties and a 5 %
profit margin. The latter was established on the basis of
the profit margins considered reasonable in this business
sector for unrelated importers.

(25) Where cost allocations for importers' general administra-
tion and selling expenses were necessary in the construc-
tion of export prices, these were made on the basis of
turnover.

3. Comparison and dumping margin

(26)

In accordance with Articles 2(10) and 2(11) of the Basic
Regulation,
the weighted average normal value per
model was compared with the weighted average export
price per model, at ex-factory level and at the same level
of trade. For the purpose of a fair comparison, adjust-
ments were granted for those differences affecting price
comparability for which satisfactory evidence was
supplied. Thus, adjustments were made in respect of
insurance, credit and packaging.
transport,

(27)

The comparison of normal value and export prices
showed the existence of dumping. The dumping margin
expressed as a percentage of the CIF Community frontier
value of the imports was found to be 208,1 %.

D. COMMUNITY INDUSTRY

(28)

investigation, Tokai Seiki GmbH, a
In the present
the
subsidiary of Tokai Corporation, a producer of
product concerned in the Community and the only
cooperating importer in the Community of disposable
flint lighters originating in Japan, was not included in
the definition of the Community industry in accordance
with Article 4(1)(a) of the Basic Regulation as it was the
sole importer of the product under consideration and a
100 % subsidiary of Tokai Corporation Japan.

(29) Disregarding Tokai Seiki GmbH's production, the three
Community producers which cooperated with the
present investigation (including their subsidiaries) repre-
sented almost the totality of Community production of
disposable flint lighters. Consequently, these three co-
operating
the
Community industry within the meaning of Article 4 of
the Basic Regulation.

Community

producers

constitute

E. INJURY

1. Preliminary remark

(30)

In Recital 15 of the definitive duty Regulation it was
concluded that ‘the cumulated dumped imports from
Japan, the People's Republic of China, the Republic of
Korea and Thailand had caused material injury to the
Community industry’. As meanwhile
the measure
concerning the Republic of Korea lapsed and the meas-
ures concerning the People's Republic of China and
Thailand have been amended further to interim reviews
as stated in recital 2 of this Regulation, the actual impact
of imports originating in Japan, as well as the possible
impact seen from the angle of recurrence, had to be
examined in isolation.

2. Consumption in the Community

(31)

In order to calculate total apparent consumption of
disposable flint lighters in the Community, Community
producers' sales in the Community were added to the
total imports originating in third countries, as declared
under CN code ex 9613 10 00. An adjustment was
made as regards imports originating in China for the
years 1994 and 1995 (see recital 46 to Regulation (EC)
No 423/97). On this basis annual apparent consumption
in the Community increased by 27 %,
from 617,7
million units in 1992 to 785,4 million units in 1996.

27. 1. 2000

EN

Official Journal of the European Communities

L 22/19

3. Factors relating to imports originating in Japan

upward effect the anti-dumping duty of 35,7 % must
have had on the price charged by the related importer.

Volume and market share

4. Situation of the Community industry

(32)

From 1992 to the investigation period,
imports from
Japan plummeted to very low levels in absolute terms.
The indexed import figures were 100 in 1992, 150 in
1993, 33 in 1994 and 83 in 1995, while sales of such
imports during the investigation period represent but
6,1. The market share of imports from Japan decreased
from around 0,5 % in 1992 and 1993 to 0,06 % during
the investigation period. The anti-dumping measure
under review therefore effectively limited the impact of
dumping of imports of disposable flint lighters origin-
ating in Japan.

(33)

In this context
it should, however, be noted that a
considerable portion of overall imports was dumped. In
imports from Mexico, the Philippines and
particular,
Thailand should be mentioned in this regard, as referred
to in Regulation (EC) No 423/97.

Price undercutting

(34)

(35)

The Commission calculated to what extent the prices
charged by the exporter in the Community market
undercut the price charged by the Community produ-
cers. As all sales made by the exporter were made to its
related importer, this comparison was made at the level
of sales to the first independent customer, and on the
basis of
the related importer's and the Community
producers' weighted average selling prices free of all
rebates and taxes The price charged by the related
importer was not adjusted for anti-dumping duties paid.

The comparison was made at the level of prices to
wholesalers (thus excluding sales to retailers and the
advertising sector). Moreover, the price comparison was
made for naked lighters (including, however, the lighters
the exporter presented as ‘wrapped’) as the exporter had
not exported any printed or sleeved lighters during the
investigation period.

(36) As in the original investigation and in accordance with
Article 11(9) of the Basic Regulation, the price undercut-
ting calculation was made for lighters with a similar gas
content (see recital 13 of Regulation (EEC) No 3433/91).

(37) On this basis it was found that the average price of the
imported products undercut the weighted average price
of
the Community producers by 22,9 % during the
investigation period. This is to be compared with the
average undercutting of 11,5 % found in the original
investigation. It should therefore be concluded that the
exporter's undercutting level has increased, despite the

Production

(38)

From 1992 to 1996 production by the Community
industry increased by 28 %.

Capacity and Utilisation of capacity

(39)

The capacity utilisation rate increased from 66 % in
1992 to 73 % in 1994, to drop to 71 during the invest-
igation period. This drop coincided, however, with an
increase in capacity. Although an increase in capacity of
almost 25 % was reported, the increases in capacity are
quite recent, as from 1992 to 1994 capacity did not
increase at any material rate.

Sales volume

(40)

in units

Sales
in the Community market by the
Community industry increased by 33 % from 1992 to
the investigation period.

Market share

(41)

(42)

(43)

share of
the
In a growing market,
the market
Community industry dropped rather
steadily from
66,1 % in 1992 to 46,8 % in 1995, after which it
increased somewhat to 53,6 % during the investigation
period. This market share is still somewhat lower than
the 1990 market share of 57,3 % (see recital 48 to
Regulation (EC) No 423/97) but
the
Community industry is beginning to recover from the
effects of dumped imports.

shows

that

Price evolution and total sales value

It was established that weighted average sales prices of
the Community industry had dropped by almost 8 %
from 1992 to the investigation period. The favourable
development of sales volume was therefore not fully
reflected in terms of turnover: the value of sales in the
Community market increased by only 23 %.

The lighter market is known to be very price sensitive.
This means that faced with low priced dumped imports,
the Community industry is either forced to lower its
prices in order to try to maintain market share, produc-
tion level and capacity utilisation, or set to lose market
share if it tries to maintain its prices.

L 22/20

EN

Official Journal of the European Communities

27. 1. 2000

Profitability

5. Conclusion

(50)

(51)

(52)

(53)

(54)

(55)

(44) After several years of losses, the Community industry's
return on sales became slightly positive in 1991 and
deteriorated somewhat in 1992 (see recital 555 to Regu-
lation (EC) No 423/97).

(45)

For the present investigation 1992 was taken as the
basis for comparison. After a further deterioration in
1993, the Community industry's financial results have
steadily improved: compared to 1992, the profit rates
more than doubled in 1994 and more than tripled in the
investigation period.

(46) Nevertheless,

the data supplied by the Community
industry, which for this purpose did not include one of
the complainants given that it did not give an admissible
reply on profitability, show that since 1992 its overall
financial performance continued to be below the target
set as a reasonable profit for this industry in the defin-
itive duty Regulation (see recital 17 of that Regulation).
In fact, profits in 1992 and 1993 were very small and,
although in the following years an improvement was
noticeable, profits were less than half the non-injurious
level set.

(47)

(48)

Stocks

The Community industry did not build up any signifi-
cant stocks. It is usual practice in this sector to stop
production if stocks become too big because of the
security risks of stocking lighters containing gas for a
long period of time. Moreover, as rationalisation efforts
have been made the overall stocks at the end of the
investigation period were some thirty percent smaller
than those at the end of 1992.

Employment

From 1992 to the investigation period, employment in
the Community industry was stable from 1992 to 1994
and increased by some 17 % since 1995. While this
could be said to be a sign of recovery, it should be noted
that the employment figure for 1992 was at its lowest
level and had fallen by 13 % since 1989 (see recital 49
to Regulation (EC) No 1006/95). It was noted that a
considerable portion of the expansion pertains to the
sales and administrative segment rather than to produc-
tion.

The situation of the Community industry has improved
in recent years due to an increase of their sales in both
the Community market and third countries. This devel-
opment coincided with the imposition of several anti-
dumping duties.

The increase in sales in the Community market is most
probably due to both the growth of consumption and,
to a lesser extent,
to the beneficial effects of anti-
dumping measures taken by the Community.

The downward trend of
the
Community industry was reversed since 1995, but its
53,6 % market share during the investigation period is
still smaller than the 1992 one.

the market

share of

The increase in apparent consumption and the fact that
anti-dumping measures were imposed, should normally
have had an upward effect on prices in the Community
market. Nevertheless,
the Community
industry were found to have decreased by 8 %.

the prices of

Sales by the Community industry in the Community
market proved more profitable during the investigation
period than in e.g. 1992. However, the prices charged
by the exporter in the Community market still undercut
the Community industry's prices after application of the
anti-dumping duty and the levels of profitability were
still much lower than the non-injurious level fixed in the
definitive duty Regulation.

it

the above,

is considered that

In the light of
the
Community industry continues to suffer injury, notably
in terms of profitability and the growth of market share.
As the market share of
imports of disposable flint
lighters originating in Japan was very small, it was not
possible to establish a causal link between the dumped
Japanese imports and this injury. The injury caused by
in
these imports is therefore considered negligible or,
any case, not material.

F. LIKELIHOOD OF RECURRENCE OF

INJURIOUS

DUMPING

Exports

1. Introduction

(49)

The Community industry performed well
in export
markets. Its sales in units steadily increased from 1992
to the investigation period. Over this period export sales,
which represent approximately 60 % of the Community
industry's overall production,

increased 69 %.

(56)

The Community industry requested that the definitive
duty Regulation be reviewed arguing that there was a
likelihood of recurrence of injurious dumping. In order
to make a determination on this point, a number of

27. 1. 2000

EN

Official Journal of the European Communities

L 22/21

in particular the exporter's
factors were considered,
group behaviour, the availability of unused capacity at
the exporter's plant in Japan, the existence of a price
undertaking with respect
to exports by a company
belonging to the exporter's group and the price the
the duty were allowed to
exporter might charge if
expire. In addition to the examination of the position of
the Community industry,
resumed
exports from Japan would be likely to have on the
Community industry, the existence of dumping practices
and the evolution of the share of overall imports in the
Community market were examined.

the impact

that

2. Exporter's group behaviour

In recent years, only small quantities of disposable flint
lighters were imported from Japan and sold on the
Community market,
especially when compared to
imports from several other third countries (primarily
China, Mexico,
the Philippines and Thailand) whose
prices were found to be at dumped levels. However, the
imports originating in Japan has to be
low level of
considered in the light of the Tokai group's behaviour.

The sole exporter in the investigation concerning, inter
alia,
imports originating in Mexico further to which
definitive anti-dumping measures were imposed in
March 1997 — was a fully owned and controlled
subsidiary of the Tokai group developed after the impo-
sition of anti-dumping measures on disposable flint
lighters originating in Japan (see recitals 9 and 36 to
Regulation (EC) No 423/97). The import figures show
that imports from Mexico have simply replaced those
produced (and exported) by Tokai Corporation at its
Japanese plant, after the imposition of measures on the
latter
the imported quantities of
lighters originating in Mexico are similar to the quant-
ities that Tokai Corporation used to deliver to the
Community market from Japan prior to the imposition
of the 1991 measure. Moreover, it should be recalled
that Tokai Corporation started a downward price trend
by selling Japanese lighters at dumped prices in the late
subsequently reinforced by
1980s. This
dumping practices of other Asian producers and its
resumption of dumping through its subsidiary set up in
Mexico.

trend was

in 1991.

Indeed,

(57)

(58)

(60)

therefore considered appropriate to take into
is
It
account
that, as of 7 March 1997, definitive anti-
dumping duties were imposed on imports of disposable
flint lighters originating in Mexico, the Philippines and
Thailand by Regulation (EC) No 423/97 and that the
to anti-dumping
Mexican exporter, currently subject
measures, is a subsidiary of the Japanese exporter, when
examining what
the existing
measure were allowed to lapse.

is likely to happen if

3. Japanese production capacity

(61)

From 1992 to the investigation period, the exporter's
in
production capacity decreased by 54 %. However,
addition to the decrease of production capacity,
the
utilisation rate (expressed in percent) of its remaining
capacity also decreased by 38 % from 1992 to the
investigation period.

(62) During the investigation period, unused capacity at the
exporter's Japanese plant accounted for a bigger quantity
lighters Tokai
than the 56,6 million disposable flint
Corporation exported from Japan in 1989 (i.e.
the
investigation period of the original investigation. It was
also established that, from 1992 to the investigation
period, the unused capacity had been rather stable in
absolute terms, given the concomitant decreases of
production capacity and the capacity utilisation rate.

4. Price undertaking applicable to another group

company

(63) After the imposition of the measure under review, the
exporter
shifted the production of disposable flint
lighters destined for export to the Community market to
Mexico and subsequently offered a price undertaking in
imports originating in that country when
respect of
anti-dumping measures
imports were
warranted in March 1997.

these

on

(64) Without moving production lines from Mexico to Japan,
the exporter has sufficient freely disposable capacity at
its Japanese plant to supply the Community market with
a quantity higher than its 1989 exports and this would
allow the exporter
to charge lower prices on the
Community market than permitted for imported prod-
ucts originating in Mexico.

(59)

In the light of the above, the low level of Japanese
imports during the investigation period cannot lead to
the conclusion that these developments, which occurred
after the imposition of measures in 1991, are the result
of normal
an exporting
i.e. behaviour independent of the measures
producer,
subject to review.
In fact, they are the result of an
apparent strategy of the Tokai group.

economic behaviour of

5. Continuation of dumping and price the exporter

might charge

(65) As stated above, during the investigation period, imports
of disposable flint lighters originating in Japan continued
to be dumped. As the imported products were sold at
prices which were significantly more dumped than in
the original investigation it appears likely that dumping
will continue.

L 22/22

EN

Official Journal of the European Communities

27. 1. 2000

(66) Despite the application of the anti-dumping duty, under-
the average unit price charged by the
cutting of
Community producers was
(22,9 %)
during the investigation period. If the anti-dumping duty
had been deducted from the price charged to the first
the
the
independent
Community industry would have been undercut by as
much as 43,1 %.

average price of

significant

customer,

still

6. Impact on the Community industry

(67)

(68)

The price depressing effect of continued dumping during
the investigation period was minimal, due to the
application of
the anti-dumping duty and the small
quantities imported. The exporter had, however, suffi-
cient unused capacity to resume exports of disposable
flint lighters originating in Japan at significant levels, e.g.
similar to the quantity imported in 1989 (56,6 million).
If such a quantity would be sold in the Community
the same prices charged by the German
market at
subsidiary of
the exporter during the investigation
period, this would result in substantial downward pres-
sure on prices in the Community market and corre-
sponding losses of turnover and market share.

The quantity imported from Japan in 1989 would pres-
ently represent a market share of approximately 7,2 %.
This market share is too significant to be without any
impact on the situation of the Community industry It
was, however, not possible to establish with precision
what the effect of the removal of the measures would be
on such factors as market shares, profitability and
employment of
the Community industry, as much
would depend on uncertain factors such as the growth
of consumption in the Community and the general price
depression which may be caused by the resumption of
importation of significant quantities.

(69) A global analysis of some specific aspects of the main
regional markets in the Community was made to assess
the impact of the importation of significant quantities of
disposable flint lighters originating in Japan at prices
which significantly undercut the Community price is
likely to have on the Community industry.

(71)

(72)

(73)

future price undercutting
consumers. The effects of
would therefore be significant (in terms of loss of market
share and loss of profitability since it would most likely
last for an extended period of time as access to the
distribution network is normally granted for
long
contract periods.

It was also established that at producer level prices in the
United Kingdom were relatively low and the Community
producers were not well established in this market. In
these circumstances,
future price undercutting would
impair the penetration of Community producers' dispos-
able flint lighters in this already difficult market and
further reduce the profitability of their sales.

Competition in the French market was found to be
important due to the presence of manufacturing plants
of two major Community producers but price depres-
sion appeared less important than in e.g. Germany and
the UK. Future and increased price undercutting would,
however, be likely to bring about greater price depres-
sion and a loss of market share.

It was also established that two Community producers
have production plants in Spain and are well established
in that market. It was found that a very substantial part
of the Spanish market is supplied by non-Community
producers, as Spain was the second largest importing
Member State in 1995, and prices were low compared
to France and Germany. As one of the producers estab-
lished in Spain indicated that further rationalisation and
cost reduction in its production plant was not possible, a
loss of a substantial market share or a price war in the
Spanish market is likely to result in closure of its plant,
especially if this loss were matched by a similar develop-
ment in the nearby,

important French market.

7. Volume and prices of overall imports

(74) As stated above, the Japanese exporter decided to supply
the Community market with products manufactured in
Mexico, on which anti-dumping measures were imposed
in March 1997. Therefore, the remedial effect of the
measure imposed in 1991 was much smaller than it
would have been under normal circumstances.

(70)

It was established that competition on the German
market was fierce as major distributors and, in partic-
ular, supermarket chains usually select one or two
suppliers per product offered in their outlets and thus
exercise downward pressure on the prices of
these
suppliers. In this situation even minimal price undercut-
ting precludes
to
distribution networks representing a large number of

the Community industry's access

(75)

In addition, overall imports of disposable flint lighters
increased by 74 % from 1992 to the investigation
period, an increase much higher than the increase of
consumption during that period. As a result, the market
share of these imports increased from 33,5 % in 1992 to
53 % in 1995 and dropped to 46,3 % in 1996.

27. 1. 2000

EN

Official Journal of the European Communities

L 22/23

(76) As shown by the successive anti-dumping measures
imposed from 1992 to 1998, there has been a contin-
uous influx of low-priced and dumped imports from
third countries in the Community market. As a result
prices on the Community market have continuously
dropped to reach low levels: in a growing market the
prices of the Community industry nevertheless decreased
by 8 % from 1992 to the investigation period.

(80) Although no closure of production plants occurred, this
appears due to a strategic approach of the producers
concerned, supported by the existence of anti-dumping
measures concerning disposable flint lighters and the
development of
it
their export sales.
should be noted that all three producers have profitable
activities in other sectors, which provide enough finan-
cial resources to maintain their production plants for
disposable flint
It cannot,
for
however, be ruled out that the effects of a discontinu-
ation of an anti-dumping measure will provoke the
closure of one or more of the production plants.

In this regard,

some time.

lighters

G. COMMUNITY INTEREST

(81)

In view of the above, the effectiveness of the Commu-
nity's measures designed to re-establish fair and open
market conditions and to protect
the Community
industry against an unfair trading practice is at stake.
This major consideration apart, there is a serious risk
that Community producers put an end to production at
one or more plants, if the anti-dumping measure were
allowed to lapse and subsequently injurious dumping of
large quantities of disposable flint lighters originating in
Japan would occur.

2. Importers

(82) As the exporter did not report any direct sales to unre-
lated parties in the European Community and no reac-
tion was received from any importer after the publica-
tion of the notice of initiation, no unrelated importers of
Tokai's lighters originating in Japan could be identified.

1. Community industry

The Community industry has for almost a decade been
suffering from low-priced and dumped imports of
disposable flint lighters. The objective of the definitive
duty 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 is shown by subsequent develop-
ments: Tokai itself set up a production plant in Mexico
and started exporting from there to the European
Community at dumped prices, while other third coun-
tries — more particularly China, the Philippines and
Thailand — also resorted to dumping. As a result the
Community industry has not been able to recover
entirely, despite its efforts to reduce costs and to benefit
from economies of scale.

The Community industry consists of two multinational
groups selling several products other than disposable
flint
lighters and a relatively small producer, which
combines the production of disposable flint lighters with
a trading company.

(83) As regards Tokai's subsidiary in Germany, which is the
sole importer of disposable flint lighters originating in
Japan, it should be noted that it employed a very limited
number of people as compared to the Community
industry. The impact on this importer of maintaining the
measure under review is therefore likely to be minimal.

The Community industry has been making considerable
efforts to improve its productivity in recent years in an
attempt to obtain the lowest possible cost of production
and to enhance its competitiveness in this price sensitive
the two
market. Rationalisation efforts were made:
producing groups have rationalised their production
process and adapted their structures, the third producer's
efforts were primarily based on the realisation of econo-
mies of scale. New investments were also made to
improve productivity. However, given that export sales
increased much faster than sales in the Community and
export sales represent more than half of the Community
producers' sales, the investments in production capacity
were primarily made for the purpose of supplying
markets other than the Community market.

3. Consumers

(84)

In the original investigation, the importers alleged that
the interests of consumers would be adversely affected
by anti-dumping measures on disposable flint lighters.
However, in the present investigation, no representations
of consumers associations were received and there is
otherwise no reason to assume that a change of circum-
stances has occurred which could invalidate the argu-
ments used in previous investigations to reject this alle-
gation.

(77)

(78)

(79)

L 22/24

EN

Official Journal of the European Communities

27. 1. 2000

H. REPEAL OF ANTI-DUMPING MEASURE

(85) On the basis of these facts, the Commission concluded
that
injurious
there was likelihood of recurrence of
dumping and in April 1999, made the second of two
proposals to impose a definitive anti-dumping duty on
imports of gas-fuelled, non-refillable pocket flint lighters
originating in Japan. However, the appropriate majority
in the Council was not achieved to adopt a Regulation
on the basis of either Commission proposal.

(86) Article 11(2) of the Basic Regulation provides that a
definitive anti-dumping measure shall expire five years
from its imposition, unless it is determined in a review
that the expiry would be likely to lead to a continuation
or recurrence of dumping and injury. If an expiry review
is carried out, the anti-dumping measure remains in
force pending the outcome of the review.

(87)

In the present case, therefore, the result of the Council
deciding not to adopt a Regulation on the basis of a
Commission proposal would have the consequence that
the review proceeding remaining open and the existing
measure remaining in force for an unlimited period of
time.

(88) Moreover, Article 11(5) of the Basic Regulation provides
that a review shall be carried out expeditiously and shall
normally be concluded within 12 months of the date of
initiation of the review.

(89)

In these circumstances, the Commission considers that
the anti-dumping duty on gas-fuelled, non-refillable
pocket
lighters originating in Japan should be
repealed in order to avoid both an undue duration of the
review and the remaining in force of the anti-dumping
measure for an indefinite period of time.

flint

I. FINAL PROVISIONS

(90) All interested parties cooperating with the investigation,
the complainants, the exporter and the Japanese govern-
ment, received disclosure in writing of the essential facts
and considerations on the basis of which the Commis-

(91)

(92)

sion intended to recommend that the definitive measure
be repealed.

The complainant producers objected to the intended
course of action arguing that the circumstances had not
changed and that in their opinion the anti-dumping duty
should be maintained.

that

Taking into account
the anti-dumping duty on
imports originating in the Republic of Korea imposed by
the Regulation by which the definitive anti-dumping
duty on disposable flint lighters originating in Japan was
also imposed has meanwhile lapsed, provision should be
made to remove the references to the anti-dumping duty
on imports from the Republic of Korea from the Regula-
tion,

HAS ADOPTED THIS REGULATION:

Article 1

1.
Regulation (EEC) No 3433/91 is hereby repealed insofar
as it imposes a definitive anti-dumping duty on imports of
gas-fuelled, non-refillable pocket flint lighters falling within CN
code ex 9613 10 00 originating in Japan.

Regulation (EEC) No 3433/91 is hereby amended as

2.
follows:

(i) In Article 1(1) the terms ‘originating in Japan, the People's
Republic of China and the Republic of Korea’ shall be
replaced by ‘originating in the People's Republic of China’.

(ii) Article 1(2) shall be replaced by the following:

‘2.

The amount of duty shall be EUR 0,065 per lighter.’

Article 2

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

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

Done at Brussels, 24 January 2000.

For the Council

The President

J. GAMA