Commission Decision No 283/2000/ECSC of 4 February 2000 imposing a definitive anti-dumping duty on imports of certain flat rolled products of iron or non-alloy steel, of a width of 600 mm or more, not clad, plated or coated, in coils, not further worked than hot-rolled, originating in Bulgaria, India, South Africa, Taiwan and the Federal Republic of Yugoslavia and accepting undertakings offered by certain exporting producers and terminating the proceeding concerning imports originating in Iran
Date: 2000-02-04
Institutions: European Commission
Subjects: anti-dumping duty, flat product, import, iron and steel product, third country

5. 2. 2000

EN

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COMMISSION DECISION No 283/2000/ECSC

of 4 February 2000

imposing a definitive anti-dumping duty on imports of certain flat rolled products of iron or
non-alloy steel, of a width of 600 mm or more, not clad, plated or coated, in coils, not further
worked than hot-rolled, originating in Bulgaria, India, South Africa, Taiwan and the Federal
Republic of Yugoslavia and accepting undertakings offered by certain exporting producers and
terminating the proceeding concerning imports originating in Iran

THE COMMISSION OF THE EUROPEAN COMMUNITIES,

Having regard to the Treaty establishing the European Coal and
Steel Community,

Having regard to Commission Decision No 2277/96/ECSC of
28 November 1996 on protection against dumped imports
from countries not members of the European Coal and Steel
Community (1), as amended by Commission Decision No
1000/99/ECSC (2), and in particular Articles 8 and 9 thereof,

(4)

After consulting the Advisory Committee,

Whereas:

A. PROCEDURE

1. Initiation

(1)

(2)

On 7 January 1999, the Commission announced by
means of a notice (hereinafter referred to as the ‘Notice
of Initiation’) published in the Official Journal of the Euro-
pean Communities (3) the initiation of an anti-dumping
proceeding with regard to imports into the Community
of certain flat rolled products of iron or non-alloy steel,
of a width of 600 mm or more, not clad, plated or
coated,
further worked than hot-rolled,
originating in Bulgaria, India, Iran, South Africa, Taiwan
and the Federal Republic of Yugoslavia (hereinafter
referred to as ‘Yugoslavia’).

in coils, not

the product

The proceeding was initiated as a result of a complaint
lodged by Eurofer on behalf of Community producers
representing a major proportion of the total Community
concerned within the
production of
meaning of Articles 4(1) and 5(4) of Commission
Decision (EC) No 2277/96/ECSC, hereinafter referred to
as
contained
evidence of dumping of the product concerned and of
material injury resulting therefrom, which was consid-
ered sufficient to justify the initiation of a proceeding.

‘Basic Decision’. The

complaint

the

2. Investigation

(3)

The Commission officially advised the exporting produ-
cers in the exporting countries (hereinafter referred to as
the ‘exporting producers’) and importers as well as their
representative associations known to be concerned, the
the exporting countries and the
representatives of

(1) OJ L 308, 29.11.1996, p. 11.
(2) OJ L 122, 12.5.1999, p. 35.
(3) OJ C 4, 7.1.1999, p. 3.

complaining Community producers of the initiation of
the proceeding. The Commission sent questionnaires to
all these parties and to those who made themselves
known within the time limit set in the Notice of Initia-
tion. Pursuant to Article 6(5) of the Basic Decision, the
Commission also gave the parties directly concerned the
opportunity to make their views known in writing and
to request a hearing.

Certain exporting producers, complaining Community
producers
in
writing.

submitted comments

and importers

All interested parties who requested a hearing within the
time limit set and who indicated that they were likely to
be affected by the result of the proceeding and that there
were particular reasons why they should be heard, were
granted such a hearing.

(5)

All parties were informed of
facts and
considerations on the basis of which it was intended to
recommend

the essential

(i) the imposition of definitive anti-dumping duties on
imports from Bulgaria, India, South Africa, Taiwan
and Yugoslavia,

(ii) the acceptance of an undertaking offered by an

exporting producer in Bulgaria and

(iii) the termination of the proceeding against imports

from Iran.

In accordance with the provisions of Article 20 of the
Basic Decision parties were also granted a period within
which they could make representations subsequent to
this disclosure.

The oral and written comments submitted by the parties
were considered and, where appropriate, the definitive
findings have been modified accordingly.

The Commission sought and verified all the information
it deemed necessary for the purpose of a definitive deter-
mination.

Verification visits were carried out at the premises of the
following companies:

— Complaining Community producers:

— Aceralia Corporacion Sid., Madrid, Spain

— British Steel Plc, London, United Kingdom

(6)

(7)

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— Cockerill Sambre SA, Brussels, Belgium

— Hoogovens Steel BV, Ĳmuiden, Netherlands

— ILVA Spa, Genoa, Italy

— Sidmar NV, Gent, Belgium

— Salzgitter AG, Salzgitter, Germany

— Stahlwerke Bremen GmbH, Bremen, Germany

— SOLLAC, Paris, France

— Thyssen Krupp Stahl AG, Duisburg, Germany

— Exporting producers:

(a) Bulgaria

Kremikovtzi Corp, Sofia

(b) India

Essar Steel Ltd, Hazira

Tata Iron & Steel Company Ltd, Calcutta

Steel Authority of India Ltd, New Delhi

(c) Iran

Mobarakeh Steel Company, Esfahan

(d) South Africa

Iscor Ltd, Pretoria

Highveld Steel & Vanadium Corp Ltd, Witbank

(e) Taiwan

China Steel Corp, Kaohsiung

Yieh Loong Enterprise Co., Ltd, Kaoshiung

(f) Yugoslavia

In view of the particular situation in Yugoslavia,
no investigation was carried out at the premises
of Sartid a.d., the only exporting producer in that
country that made itself known to the Commis-
sion.

— Unrelated importer — user company in the Community:

Marcegaglia Spa, Gazoldo degli Ippoliti, Italy

— Importers related to the exporting producers:

(a) Iran:

Ascotec GmbH, Düsseldorf, Germany

(11)

Irasco s.r.l., Genova, Italy

Tara Steel Trading GmbH, Düsseldorf,
Germany

Unitech Steel
United Kingdom

(UK)

Ltd,

London,

(b) South Africa:

Macsteel
Antwerpen, Belgium

International Belgium NV,

Macsteel
GmbH, Düsseldorf, Germany

International

Stahlhandel

(8)

The investigation of dumping covered the period from 1
January 1998 to 31 December 1998 (hereinafter
referred to as the ‘investigation period’). The examination
of injury covered the period from 1 January 1995 up to
the end of the dumping investigation period (hereinafter
also referred to as the ‘period examined’).

B. PRODUCT CONCERNED AND LIKE PRODUCT

1. Product concerned

(9)

The product concerned is certain flat rolled products of
iron or non-alloy steel, of a width of 600 mm or more,
not clad, plated or coated, in coils, not further worked
than hot-rolled (hereinafter
‘hot-rolled coils’). This
product
currently classifiable within CN codes
7208 10 00, 7208 25 00, 7208 26 00, 7208 27 00,
7208 36 00, 7208 37 10, 7208 37 90 (1), 7208 38 10,
7208 38 90, 7208 39 10, 7208 39 90.

is

(10) Hot-rolled coils are generally obtained in steel mills by
hot rolling semi-finished steel products after the final
rolling pass or after pickling or continuous annealing.
Hot-rolled coils are wound into a regular coil.

For steel mills, which produce a great range of
flat
products of steel, hot-rolled coils are used as a pre-
material for manufacturing other steel products (wide
and narrow strips, all cold rolled products, tubes, etc.).
Hot-rolled coils can be of various grades and dimen-
sions. The vast majority of imports from third countries
into the Community consist of ‘structural steels’ (such as
S235 and S275 according to ‘Euronorm’ EN 10025) and
‘mild steels’ (such as DD11, DD12, DD13 according to
EN 10011 and the ‘Deutsche Industrie-Norm’ DIN 1614/
1). Coils are conventionally between 1.5 and 15 mm
thick and from 600 to 2050 mm wide. Each of the CN
codes listed above corresponds to a specific product type
as differentiated by width and thickness within the
above ranges.

The product concerned is also classified into two distinct
categories according to its finishing: black hot-rolled
coils (hereafter referred to as ‘black coils’) which are the
basic product and pickled hot-rolled coils (hereafter
referred to as ‘pickled coils’) which, after being hot-
rolled, go through an additional surface treatment called
pickling. The distinction between black coils and pickled
coils is also reflected in the structure of the combined
nomenclature as coils classified under the two categories
belong to specific and separate CN codes.

Macsteel
London, United Kingdom

International

UK

Ltd,

(1) See corrigendum published in OJ C 27, 2.2.1999, p. 30.

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(12) Although imports from the countries concerned are
mainly black coils,
investigation showed that
the
imports cover all the CN codes and thus all the different
products listed above. Notwithstanding the fact that each
CN code corresponds to a distinguishable type of hot-
rolled coil, it was found that they all have identical or
similar physical and technical characteristics, uses and
applications. Accordingly, all types of hot-rolled coils
form one single product falling under the CN code listed
in recital (9) above.

2. Like product

(13)

(14)

The investigation has shown that the hot-rolled coils
imported from the countries concerned are identical to
or comparable to the Community-produced products, in
particular in terms of the grades and the range of dimen-
sions available.

the product
Some exporting producers claimed that
is not inter-
concerned which they produce and sell
such with the
changeable and not comparable as
Community-produced product. They claimed that the
production process of the Community producers was
more advanced and even used different technology, thus
producing a higher quality product. They mentioned
that users sometimes had to re-roll the imported prod-
ucts before they could be processed further. They there-
fore claimed that their product was not a like product to
that of the complaining Community producers.

(15) Obviously, any difference in the production process
resulting in surface or chemical defects may lead to a
lower market value. However, the investigation showed
that, in general both the Community-produced product
and the imported product still have the same basic
physical characteristics and uses, even though the prod-
ucts are not identical, in particular in terms of quality,
across
shipments of a given
supplier. This, however, cannot lead to the conclusion
that hot-rolled coil
countries
concerned is not a like product to that produced by the
Community industry and sold in the Community.

suppliers and across

imported from the

(16)

The investigation also showed that
the grades and
dimensions of the product concerned imported from the
countries concerned are identical or comparable to the
products sold on the domestic market of the countries
concerned.

alike within the meaning of Article 1(4) of the Basic
Decision.

C. DUMPING

1. Normal Value

(18)

In order to establish normal value,
it was first deter-
mined for each of the cooperating exporting producers
whether the total volume of the domestic sales of the
product concerned was representative in accordance
with Article 2(2) of the Basic Decision, i.e. whether these
sales represented at least 5 % of the sales volume of the
product concerned exported to the Community.

It was then examined for each exporting producer
whether
type
constituted 5 % or more of the sales volume of the same
type exported to the Community.

total domestic sales of each product

it was
For those product types meeting the 5 % test,
established whether sufficient sales had been made in the
ordinary course of trade in accordance with Article 2(4)
of the Basic Decision.

Where, per product type, the weighted average selling
price was equal to or higher than the weighted average
unit cost and where the volume of domestic sales equal
to or above unit cost represented at least 80 % of sales,
the
normal value was established on the basis of
weighted average prices actually paid for all domestic
sales. Otherwise, normal value was established on the
basis of the weighted average prices actually paid for the
profitable domestic sales only unless, per product type,
the volume of profitable transactions was lower than
10 % of the sales volume.

(19)

For those product types where the volume of domestic
sales was lower than 5 % of the volume exported to the
Community, or where the volume of profitable domestic
sales was less than 10 %, domestic sales of those product
types were considered insufficient within the meaning of
Article 2(3) of the Basic Decision and were therefore
disregarded. In these cases, normal value was based on
the weighted average of the prices charged by other
exporting producers in the country concerned, if they
had representative domestic sales of the corresponding
product type made in the ordinary course of trade in
accordance with Article 2(1) of the Basic Decision.

(17) On this basis,

it was concluded that hot-rolled coils
produced in the countries concerned and sold on the
domestic markets of
these countries, hot-rolled coils
exported to the Community from these countries and
hot-rolled coils produced and sold by the complaining
Community producers on the Community market, are

(20) Where, per product type, there were insufficient sales or
no representative domestic sales by other exporting
producers in the country concerned, normal value was
constructed on the basis of the costs of manufacturing
incurred by the exporting producer concerned for the
exported product type in question plus a reasonable
amount for selling, general and administrative (SG&A)

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costs and profits in accordance with Article 2(3) and (6)
of the Basic Decision. In general, for each exporting
producer, the SG&A were based on its representative
domestic sales and the profit margin based on its repres-
entative domestic sales made in the ordinary course of
trade. However, in one case, there was only one cooper-
in the country concerned
ating exporting producer
without representative domestic sales. Therefore,
the
weighted average of the SG&A and profit of the other
cooperating exporting producers were used,
to the
extent that these producers had representative sales and
sales in the ordinary course of trade respectively.

2. Export price

(21) Where export sales to the Community were made
directly to independent importers export prices were
established on the basis of the prices actually paid or
payable by these importers in accordance with Article
2(8) of the Basic Decision.

related to the

(22) Where export sales were made to importers in the
Community which were
exporting
producer, the export prices were constructed on the
basis of the prices at which the imported products were
first resold to independent buyers in the Community, in
accordance with Article 2(9) of
the Basic Decision.
Adjustments were made for all costs incurred between
importation and resale, including a reasonable margin
for SG&A plus profit.

3. Comparison

(23)

(24)

For the purposes of a fair comparison due allowance, in
the form of adjustments, was made for differences
claimed under Article 2(10) of the Basic Decision and
demonstrated to affect price comparability. On this
basis, adjustments were made with regard to import
charges and indirect taxes, discounts, rebates, transport,
insurance, handling, loading and ancillary costs, packing,
credit, after-sales costs and commissions.

Two companies in India claimed an allowance for
import charges. Pursuant to Article 2(10)(b) of the Basic
Decision these requests were partially granted to the
extent that it was proved that the materials on which
import duties were payable had been physically incor-
porated into the products concerned sold on the
domestic market and that the import duties had not
been collected or refunded in respect of the product
exported to the Community.

(25) One Indian company requested an adjustment for differ-
ences in quantities on the grounds that the quantities
sold per invoice on the domestic market were smaller
than the
shipment on the
sold per
Community market. It was claimed that sales to the
Community were made at a lower price due to the larger
quantities involved. Since no link was demonstrated

quantities

(26)

(27)

(28)

(29)

with discounts or rebates, as required by Article 2(10)(c)
of the Basic Decision, this request had to be rejected.

The two exporting producers in South Africa contended
that various rebate schemes applied to domestic sales of
the product concerned and that the normal value should
be reduced accordingly. Adjustments could only be
made to the extent that their link with the sales under
investigation was proved.

The exporting producer in Yugoslavia claimed that the
value of their exports should be calculated using the
alleged market exchange rate. However, as the rate used
in the financial accounts was the official exchange rate
and as the companies were not able to present sufficient
evidence demonstrating that the correct rate to be used
was the market exchange rate, it was decided to use the
official exchange rate to calculate the export price.

4. Dumping margins

a) General method

In accordance with Article 2(10) and (11) of the Basic
Decision, the dumping margins were established on the
basis of a comparison between the weighted average
normal value per product type and the weighted average
export price at ex-factory level for the same product
type and at the same level of trade.

For exporting producers concerned by the proceeding
who did not reply to the Commission's questionnaire,
did not make themselves known or did not supply
the
necessary information during the investigation,
dumping margin was determined on the basis of the
facts available in accordance with the provisions of
Article 18(1) of the Basic Decision.

A comparison of Eurostat figures with the data on the
volume of exports to the Community supplied by the
cooperating exporting producers was made in order to
establish per exporting country concerned the level of
cooperation in the current investigation. As a result, for
all countries subject to investigation, with the exception
of Taiwan, it was found that the overall level of coopera-
tion was high. The Commission therefore considered it
appropriate to set the dumping margin for the non
cooperating companies at the level of the highest indi-
vidual dumping margin established for a cooperating
exporting producer in the country concerned, since
there was no reason to believe that a non cooperating
exporting producer had dumped at a level lower than
the highest level found. Since for Taiwan the level of
cooperation was found to be low, in fact significantly
below 50 %, the level of the residual dumping margin
was set at the level of the highest quarterly dumping
margin found in that country.

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The above approach was also considered necessary in
order to avoid creating a bonus for non-cooperation and
an opportunity for circumvention.

b) Dumping margins per country

(30)

The dumping margins, expressed as a percentage of the
CIF price at Community frontier level, are:

(31)

Bulgaria

Kremikovtzi Corp

Residual

(32)

India

Essar Steel Ltd

Steel Authority of India Ltd

Tata Iron & Steel Company Ltd

Residual

(33)

South Africa

Iscor Ltd

27,1 %

27,1 %

55,8 %

56,3 %

29,4 %

56,3 %

47,8 %

Highveld Steel & Vanadium Corp Ltd

37,8 %

Residual

(34)

Taiwan

China Steel Corp

Yieh Loong Enterprise Co Ltd

Residual

(35)

Yugoslavia

Sartid a.d.

Residual

(36)

Iran

47,8 %

8,8 %

2,1 %

30,3 %

56,1 %

56,1 %

As set out in recital (69) below, it was found that the
imports from Iran were below the de minimis threshold
foreseen in Article 5(7) of the Basic Decision. Therefore,
it was not considered necessary to carry out a dumping
determination with respect to this country.

D. COMMUNITY INDUSTRY

1. Determination of

relevant Community

the
market

(37)

the

purposes

establishing whether

the
For
of
Community industry had suffered injury and,
in this
context, for determining consumption and the various
economic indicators related to the situation of
the
it had to be examined whether
Community industry,

(38)

(39)

(40)

this industry destined for the captive
production of
market should be excluded for the purposes of this
analysis or whether injury and consumption should be
assessed in relation to the entire production of
the
Community industry.

There are sixteen producers of hot-rolled coils in the
Community. Around 70 % of the hot-rolled coils manu-
factured by these producers are used in a captive market,
i.e. they are further transformed by these producers in
an integrated process (hereinafter referred to as ‘captive
market’). These hot-rolled coils
follow an internal
process of transfers to downstream processing works,
for which no invoices are issued since the transfers
occur within the same legal entity. The remaining
production (hereinafter referred to as ‘free market’) is
sold to both related and unrelated parties.

In this respect, the complainant claimed that two sepa-
rate markets should be distinguished. It claimed that the
hot-rolled coils destined for a captive market were not in
direct competition with dumped imports. Consequently,
the imports subject to investigation could not affect this
market. In parallel, the complainant has claimed that the
remaining production was sold on the free market
where competition with dumped imports takes place.
The main purchasers on the free market are independent
cold-rolling mills such as tube makers, steel service
centres (hereinafter referred to as ‘SSC's’), steel merchants
and stockholders. Only the hot-rolled coils sold on the
free market are subject to the complaint.

Exporting producers and importers of hot-rolled coils
onto the Community market claimed that the definition
of the product concerned and the like product covered
all hot-rolled coils. They claimed in particular that there
was no clear separation between the captive and free
markets and that the definition of the free market made
by the complainant was arbitrary. They therefore
requested that the assessment of the Community market
should include the captive market and the free market
taken together.

(41)

In support of this claim, reference was made to the
Gimelec judgment (1) of the European Court of Justice.
They stated that
the
Court referred to the following factors to rule out the
existence of two separate markets:

in the above-mentioned ruling,

— the product concerned was sold on the same market

and used for the same purposes;

— the Community

product
concerned both to related and unrelated customers
and charged more or less the same price;

producers

sold

the

— companies on the downstream market used to buy
the product
concerned not only from related
Community suppliers but also from importers or
other unrelated producers.

(1) Case No C-315-90 of 27.11.1991

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(42)

could

producers

that Community

Some exporting producers claimed that, in the light of
the above judgement, the legal conditions to separate the
markets were not met in the present case. They consid-
ered
choose,
depending on market conditions, to sell alternatively to
the free and captive markets since Community produc-
tion of the two categories of hot-rolled coils is alike. It
was claimed that the alleged movements between the
two segments of the market legally prevented the exclu-
sion of part of Community production from the exam-
ination of injury, and in particular from Community
consumption.

(43)

In this respect the Commission made the following find-
ings:

(a) Given the high level of integration existing in the
steel industry in general and in the production of the
product concerned in particular,
the Community
producers of the product concerned merely physi-
cally transferred, without invoicing, hot-rolled coils
intended for the captive market. No invoices were
issued since the parties involved did not have sepa-
rate legal identities. As a result, there were, within
the captive market, no prices for transfers compar-
able to those in the free market.

was found that such sales were made at more or less the
same prices as those charged to independent parties. In
addition, in line with claims by certain exporting produ-
cers the investigation has confirmed that these related
parties are free to source their purchases from either
the
related or unrelated suppliers
Community. Consequently, it was concluded that sales
from Community producers to related parties having
separate legal entities were in competition with sales
from independent suppliers such as those located in the
countries concerned and that these sales should there-
fore be included in the determination of sales in the free
market.

in or outside

(46) One Community producer claimed, however, that its
sales to related parties should be considered as belonging
to the captive market.
It was argued that the prices
invoiced to its related parties were not the market prices
and were significantly different from those applied to
independent customers. The producer added that the
parent company did not allow any related parties to
purchase hot-rolled coils from independent parties on
the free market. Consequently, hot-rolled coils sold to
related parties were not
any direct
competition from other hot-rolled coils. They should
therefore be excluded from the determination of the free
market.

affected by

(b) The Community industry did not produce for stock-
piling hot-rolled coils which could subsequently be
delivered either for captive use or sold on the free
market. This is because all users of hot-rolled coils,
including the integrated processes of the Community
industry, have technical constraints for the produc-
tion of downstream products. As a result, move-
ments, if any, of hot-rolled coils between the two
markets are insignificant.

(47)

(c) The

the

investigation showed that

integrated
Community producers did not purchase the product
concerned for the captive market from independent
parties inside or outside of the Community. As a
result hot-rolled coils
the captive
market were not in competition with other hot-
rolled coils available in the Community. Con-
sequently, the captive market can clearly be distin-
guished from the free market.

intended for

the policy of

The investigation confirmed that
that
group was not to allow its related parties to purchase
hot-rolled coils on the free market. Furthermore, the
analysis of sales prices showed that the prices invoiced
to these related parties were in many instances signifi-
cantly different from market prices charged to indepen-
dent parties. Moreover, all the sales were made to related
users who used the products captively without reselling
them onwards, as such. Consequently, the Commission
concluded that
the hot-rolled coils
sales of
concerned could not be considered as being sold on the
free market and should therefore not be included in the
determination of the free market.

the

(44) On this basis the Commission considers that the separa-
tion between the free and the captive market is fully in
line with the requirements of the Basic Decision and the
Community institutions past practice.

(48)

(45)

For the purposes of establishing the economic indicators
relevant for the injury analysis such as development of
sales, profitability, etc.,
the Commission considered
whether sales from Community producers to related
parties having separate legal entities, should in general
be included in the determination of the free market. It

In conclusion, hot-rolled coils used by Community
producers as pre-material for further transformation in
an integrated process within one single legal entity were
considered to be part of a captive market. The same
applies to sales by the aforementioned Community
producer who could demonstrate that
its sales to a
related customer did indeed belong to a captive market.
All other sales of the producers in the Community were
considered to be part of the free market. Consequently,
the situation of the Community industry in terms of the
development of the various economic indicators such as
production, sales, market share and profitability was
examined with respect to the free market.

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(49)

It should be noted that the above findings regarding the
separation and the determination of the above markets
are reflected in the data collected in the framework of
the ECSC Treaty, in particular for the surveillance of the
steel markets. Indeed, such data differentiates the use of
the hot-rolled coils basically along the same lines.

2. Definition of the Community industry

(58)

a) Total Community production

(50)

(51)

(52)

Several exporting producers claimed that a number of
producers in the Community should be excluded from
the definition of Community production given that they
had imported hot-rolled coils
countries
concerned.

from the

The Commission found that none of
the producers
investigated had imported hot-rolled coils from the
countries
concerned during the period examined.
However, certain SSC's and tube producers related to
these Community producers had made such imports
during that period.

In line with the findings on the definition of the relevant
Community markets outlined in recitals (37) to (49), the
investigation confirmed, however,
these related
parties had acted independently from the producers
related to them in their operations on the free market.
Consequently, the purchases could not affect the status
of the said companies as Community producers of the
product concerned.

that

(59)

(60)

(53) Accordingly,

it was considered that

there were no
grounds for excluding any producers from the definition
of Community production of hot-rolled coils. In accord-
ance with Article 4(1) of the Basic Decision all sixteen
producers operating in the Community market represent
total Community production.

the

they argued that

said Community
particular
producer did not provide the Commission with a reply
to its questionnaire within the statutory deadlines for the
imposition of provisional duties. They considered that
this constitutes discriminatory treatment and violates
Article 6(2) of the Basic Decision.

It should be noted that all the Community producers
included in the definition of the Community industry
replied to the Commission's questionnaire within the
deadlines set forth in the Basic Decision and therefore
within the deadline for the imposition of provisional
measures. The Commission considers that all interested
parties in the present proceeding in similar situation
were given equal treatment. Consequently, any claims
suggesting an infringement to Article 6(2) of the Basic
Decision and discriminatory treatment by the Commis-
sion are not founded.

In conclusion, the eight Community producers having
fully cooperated in the investigation make up the
Community industry for the purposes of this proceeding
the total
and they accounted for around 65 % of
Community production of the product concerned.

These producers are accordingly considered as
the
Community industry and are referred to as such herein-
after as they represent a major proportion of
total
Community production within the meaning of Article
4(1) of the Basic Decision.

E. INJURY

1. Apparent consumption

(54)

(55)

(56)

(57)

b) Community industry

The complaint was lodged on behalf of eleven out of the
sixteen Community producers of hot-rolled coils while
the remaining five supported the complaint.

(61) Apparent

in the
consumption of hot-rolled coils
Community was established on the basis of the total
sales made by the 16 Community producers on the free
market and total imports of the product concerned into
the Community as indicated in the Eurostat import stat-
istics and the exporting producers' replies to the ques-
tionnaires.

The Commission received ten replies to questionnaires
from the complainant Community producers. One small
producer decided not to provide the Commission with a
response.

(62)

Two of the ten Community producers that replied to the
Commission's questionnaire, were unable to provide all
data requested during the investigation in a format
which would allow its aggregation with the data avail-
able for the other Community producers.

From 1995 up to the investigation period, apparent
consumption in the Community increased by 9 %,
namely from 18,4 million tonnes to 20,1 million
tonnes. In 1995 the free market was characterised by
exceptionally high sales prices and good demand, partic-
ularly for Community-produced hot-rolled coils. The
following year, however,
the market
decreased by 11 %.

the volume of

Some exporting producers claimed that at
least one
Community producer included in the definition of the
Community industry set out above received preferential
treatment in relation to the requirements imposed on
interested parties during anti-dumping investigations. In

(63)

Between 1996 and the investigation period, apparent
consumption increased steadily. The main growth
occurred between 1996 and 1997 when the market
increased by 22 %. Between 1997 and the investigation
period,

it increased by only 0,4 %.

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2. Imports from the countries concerned

a) Negligible imports

(64)

Based on the provisions of Articles 3(4) and 5(7) of the
Basic Decision,
the assessment of whether or not
imports were negligible was made in relation to
apparent consumption of the product concerned on the
Community market.

(65) On the basis of Eurostat statistics imports originating in
three exporting countries, namely India, Iran and South
Africa, were slightly above the 1 % threshold foreseen in
Article 5(7) of the Basic Decision.

(66)

Iran claimed that it was inappropriate to use Eurostat
statistics in assessing its market share given that an
on-the-spot investigation carried out at the premises of
the only exporting producer operating in that country
confirmed significantly lower export volumes to the
the case in past
Community. Accordingly, as was
proceedings, they argued that the Commission should
assess the Iranian market share on the basis of the
findings made during its on-the-spot investigation.

(69) Under these circumstances it was considered prudent
that in order to establish the market share held by Iran,
duly verified data should be used. Accordingly,
it is
concluded that exports from Iran are below the de
minimis threshold, that any injury from imports origin-
the
ating in Iran could only be negligible and that
proceeding should be terminated with respect to Iran.

(70) With respect to the claim by the Indian and South
African exporting producers the evidence submitted
provided no grounds for considering their imports into
the Community as negligible,
in particular given the
methodology used to determine the relevant Community
market set out in recitals (37) to (49) above. Indeed,
unlike in the case of Iran, the relevant Eurostat informa-
tion and the replies to the Commission's questionnaire
did not show imports below the de minimis threshold.
Consequently, the imports from India and South Africa
were considered to be above the de minimis threshold set
out in Articles 3(4) and 5(7) of the Basic Decision.

b) Cumulative assessment of imports

(71)

The Commission considered whether imports of hot-
rolled coils originating in Bulgaria, India, South Africa
Taiwan and Yugoslavia should be assessed cumulatively
in accordance with Article 3(4) of the Basic Decision.

(67)

India and South Africa contested the determination of
apparent consumption, claiming that their imports were
negligible and that they should, like Iran, be excluded
from the scope of the investigation.

(72)

It was therefore examined whether all criteria were met
to cumulate imports from the countries concerned. The
results of the examination showed that:

these

it was

also found that

(68) As mentioned above, it was found that on the basis of
Eurostat import statistics the market share held by Iran
was just above the de minimis threshold, namely 1,2 %.
However,
statistics
conflicted with the information collected and verified
during the Commission on-the-spot verification for the
only exporting producer in Iran. Accordingly, the Euro-
stat Statistics were thus not considered sufficiently
precise to base the assessment of the market share held
by that country exclusively on them. These statistics
were therefore also compared with the information
available from interested parties in the proceeding,
notably the only exporting producer in Iran and its
related importers based in the Community. This compar-
ison was possible and particularly relevant in the present
case because only one producer operated in Iran. As this
producer and its
related companies based in the
Community cooperated fully in the proceeding it was
possible to verify his claim by a straightforward compar-
ison between the verified export transactions and Euro-
stat. This verification and comparison established export
levels from Iran significantly below the de minimis
threshold and concluded that any difference between the
company's information and Eurostat's was not a result
of exports to the Community from Iran via other third
countries.

— the margin of dumping relating to each country, as

shown above, was more than de minimis;

— the volume of imports from each country was not
negligible when compared to Community consump-
tion;

— the analysis of

the

Indeed,

exporting

conditions of

competition
between imported hot-rolled coils and the conditions
of competition between imported hot-rolled coils
and the like Community product also indicated that
imports from the countries concerned should be
cumulated.
countries
the
concerned mainly sold hot-rolled coils on the free
Community market directly to unrelated customers,
such as cold rolling mills, tube makers, SSC's and
steel merchants. Hot-rolled coils were also imported
via related sales companies, which subsequently sold
the product concerned to the same categories of
investigation
customers mentioned above. The
showed that the Community industry was selling the
like product through the same sales channels and to
the same categories of customers. Finally,
it was
found that a similar pricing policy was followed for
all these sales.

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(73) Accordingly, contrary to the suggestion made by some
exporting producers, the Commission concluded that all
conditions justifying the cumulation of the imports from
the above-mentioned countries were met.

prices were also adjusted to ensure comparison at the
same level of trade as that of the Community industry.
All adjustments were based on the evidence collected
and verified by the Commission during the investigation.

(74)

(75)

c) Volume of the imports concerned

Based on Eurostat import statistics, between 1995 and
the investigation period, the volume of imports into the
Community from the countries concerned increased by
229 %, namely from 0,65 million tonnes to 2,14 million
imports between 1995 and
tonnes. The increase of
1996 was very limited (+ 0,10 million tonnes). The main
increase occurred between 1997 and the investigation
period (+ 1,26 million tonnes).

The analysis of
the developments during the invest-
igation period indicated that imports from all the coun-
tries concerned were made mainly during the first half of
the investigation period (1,3 million tonnes); they subse-
quently dropped by 42 % in the second half of the
investigation period but were still significantly higher
than in the second half of 1997.

(81)

(76) As already mentioned in recital (11) above, the various
types of hot-rolled coils are commonly classified into
two distinct categories: black coils and pickled coils. The
investigation showed that black coils covered around
90 % of all hot-rolled coils imported from the countries
concerned.

d) Market share of imports

(77)

The market share held by the exporting producers
increased from 3,5 % to 10,7 % between 1995 and the
increases in import
investigation period. The actual
volume thus allowed the countries concerned to gain
7,2 percentage points of the share of the Community
market.

(78)

The main increases in market share occurred between
1997 and the investigation period, when the countries
concerned gained 6,3-percentage points market share.

e) Price undercutting

(80) As already mentioned in recital

suggested that

the hot-rolled coils

(14) some exporting
producers
they
produced and sold on the Community market were not
of a comparable quality to that of
the Community
industry. One exporting producer claimed that unlike
the Community industry's production process,
their
products were not produced through continuous casting
and this caused chemical and surface defects which
lower the yield when the coils are processed further. In
addition, the fact that they do not have an automatic
‘coiler’ leads to thickness and width variations, and thus
to a poorer quality. They submitted evidence to this
effect and consequently requested a price adjustment for
differences in quality in the context of the price compar-
isons which were made in determining price under-
cutting.

The Commission found that, in general, a price adjust-
ment for differences in quality was not justified, particu-
larly as such differences were not apparent to users, and
as it emerged from the investigation that any alleged
difference in quality does not necessarily affect the use of
the product concerned. For one particular exporting
producer, however, the evidence provided indicated that
the requested quality adjustment was partly justified.
Although a detailed investigation of the level of the
adjustment requested revealed that the claim was over-
estimated, based on the evidence available half of the
requested adjustment could be granted.

(82) Accordingly,

the

comparison
expressed as a percentage of Community industry prices
are as follows:

results of

the price

— Bulgaria: 6,8 %

— India: 6,7 %

— ESSAR: 6,1 %

— Tata: 6,1 % and

— SAIL: 19,1 %

— South Africa: 5,3 %

— Iscor: 4,9 % and

(79)

In order to evaluate any possible price undercutting,
prices of comparable types of hot-rolled coils were, as
far as possible, compared under similar sales conditions
on the Community market, in the same Member State
and to the same customers. The prices of the exporting
producer free at Community frontier were compared
with the Community industry's ex-factory prices. Where
necessary, exporting countries' sales prices were adjusted
to a free at Community-frontier level, customs duty paid
these
and including relevant

import costs. Similarly,

— Highveld Steel: 27,0 %

— Taiwan: 4,3 %

— Yieh Long: 3,9 % and

— CSC: 7,5 %

— Yugoslavia: 12,4 %

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3. Situation of the Community industry between

(89)

1995 and the investigation period

The high utilisation rates were found to be normal
bearing in mind that in heavy industry, particularly in
the steel industry, high capacity utilisation is necessary
to reduce the impact of the high fixed costs of produc-
tion.

a) Production

(83)

The investigation showed that Community industry's
production peaked at 12,5 million tonnes in 1997. For
the remainder of the period examined the Community
industry's production remained stable at around 11,4
million tonnes although a fall
in consumption was
observed in 1996. It should be noted that this produc-
tion was either sold on the free market or exported to
third countries.

(90)

(84) As the production capacity of the Community industry
is used for hot-rolled coils intended for both the free and
the captive market, it was also considered necessary to
analyse information on such captive production in order
to ascertain that any drop in the production intended for
the free market was not due to an increased need for the
captive market.

(85)

It was found that between 1995 and the investigation
period, this production increased by 2 %, or by around
0,6 million tonnes. This indicated a relatively stable
captive production. As regards the trends in captive
production between 1997 and the investigation period,
these were similar to those observed above for the
production intended for the free market.

(86)

Consequently, the decrease in production intended for
the free market is not due to a greater need for captive
production.

(91)

c) Orders received and sales volume

i) O r d e r s r e c e i v e d

For

this

purpose,

examined.

In order to complement the analysis on sales, the devel-
the orders received by the Community
opment of
industry was
the
Community industry submitted data which is also avail-
able under the framework of the surveillance of the
Community steel market under
the ECSC Treaty.
Although these data do not reflect exactly the situation
with respect to the product concerned but encompassed
a slightly broader category of products, it was found that
this aggregation of data could be considered repres-
entative for the situation of
the product concerned.
These data showed that 1997 was a year where the level
of orders was high as compared to the situation found
during the investigation period. Contrary to the stable
development of
the apparent consumption between
1997 and the investigation period shown above, orders
received by the Community industry declined by 17 %
between 1997 and the investigation period.

The above finding suggests that the economic activity of
the Community industry was more regular and evenly
spread throughout the year 1997 when the volume of
received developed more in line with sales
orders
volume. Furthermore, given the existence of a time lag
between orders and deliveries,
the reduction in the
orders received indicated a reduction of the level of the
economic activity, which will be examined below.

b) Capacity and capacity utilisation

(87)

It is to be noted that production facilities can be used for
products destined for both the free and the captive
markets, as well as for other products not concerned by
this proceeding (including other steel grades and other
steel products). Capacity utilisation related to the
product concerned has therefore been established on the
basis of the capacities officially declared to the Commis-
sion within the framework of the ECSC Treaty. These
capacities are established according to specific para-
meters and must not be confused with the gross or
nameplate capacity. The gross or nameplate capacity is
the highest possible capacity achievable without taking
into account factors such as the personnel available,
holiday periods, set-up times, maintenance, etc.

ii) S a l e s

(92) During the period examined, the volume of sales slightly
increased from 9,6 million tonnes to 9,7 million tonnes,
an increase of 1 %.

(93) Within that period, the trend in sales volume broadly
consumption. However,
reflected the
between 1997 and the
the
Community industry's sales decreased by 12 % while
consumption increased slightly.

investigation period,

evolution of

(88)

The capacity utilisation rate of the Community industry
was 87 % between 1995 and the investigation period,
except in 1997 when the Community industry's produc-
tion was at its peak and the rate reached 93 %. At that
time, both the consumption of hot-rolled coils destined
for the free market and those destined for the captive
market were high.

(94)

The Community industry submitted that the injury indi-
cator concerning sales set out above has been estab-
lished on the basis of transactions delivered and invoiced
during the periods specified. In this context, it is impor-
tant
the Community industry has
organised its production process in such a way that
users' orders made on a given date are delivered and

to point out

that

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Official Journal of the European Communities

L 31/25

invoiced and thus sold to them, with a time lag of at
least three months. Therefore, in order to make a mean-
ingful assessment of the development, which occurred
during any given period, not only the actual sales but
also the orders received during such a period have to be
analysed. It is considered that any development observed
with respect to these orders is bound to translate into
corresponding developments of sales with a time lag
thereafter.

iii) D i f f e r e n t i a t i o n o f

t y p e o f s a l e s

(95)

(96)

(97)

The Community industry argued that in order to assess
the actual injury it suffered, the development of sales for
different types of hot-rolled coils under investigation,
namely black coils as compared to pickled coils, should
be analysed separately. The claim was that given the
high share of dumped imported black coils in total
imports, the development of the Community industry
sales volume and sales prices for that type of coils would
indicate a particularly injurious situation.

Investigation of this particular issue showed that from
1995 up to the investigation period (1998), the volume
of black coils sold by the Community industry on the
free market decreased by 13 %, whereas the volume of
pickled coils sold increased by 34 %. In absolute terms,
this represents a decrease of around 1 million tonnes in
sales of black coils and an increase of around 0,5 million
tonnes in sales of pickled coils.

It also confirmed that the share between the sales of
black coils and pickled coils for the Community industry
was more balanced than that of the exporting producers.
From 1995 up to 1997 the share in sales volume was
70 % of black coils against 30 % of sales of pickled coils.
During the investigation period this share became 60 %
and 40 % respectively for black and pickled coils. This
development in total sales clearly shows that during the
investigation period a shift occurred from black to
pickled coils,
i.e. from a category of products where
imports were more present to one were they were less
prominent.

e) Market share

(99)

From 1995 up to the investigation period, the market
share held by the Community industry decreased by 3,7
percentage points, dropping from 52,0 % in 1995 to
48,3 % in the investigation period.

(100) Between 1995 and 1996 and between 1996 and 1997
the market share held by the Community industry
increased by 1,1 and 1,8 percentage points respectively.

(101) Between 1997 and the investigation period, however,
the Community industry lost all the market share previ-
ously gained and fell to a lower level than that in 1995.
The losses amounted to 6,6 percentage points. Further
analysis of this situation indicated that market share was
lost due to a decrease in sales both to related and
unrelated customers on the Community free market.

f) Profitability

(102) The average return on sales made by the Community
industry for the product concerned from 1995 up to the
investigation period decreased by 39 %. The high profits
(20,7 %) achieved in 1995 were the result of high prices
on the market at that time. In 1996, despite a downturn
in the market and a reduction in sales prices (– 15 %),
the Community industry remained profitable. However,
the recovery in sales volume in 1997 did not allow that
industry to increase its profit margin since its sales
prices again decreased by 3 %.

(103) During the investigation period profitability recovered
slightly from its 1997 level. The increase in sales prices
during the investigation period (9 % compared to 1997)
allowed the Community industry to achieve a profit
margin of 12,9 %. The Community industry claimed that
this level of profit was reasonable.

(104) Some

that

suggested

exporting

producers

the
Community industry achieved an extremely high level of
profitability during the investigation period and that the
development of
should have
indicator
warranted immediate termination of
the proceeding.
They said that such profit was significantly higher than
that considered reasonable by the Commission in past
anti-dumping cases involving steel products.

alone

this

d) Price evolution

(105)

(98) During the period examined the Community industry's
weighted average sales price decreased by 10 %. In 1995
sales prices were at their highest for ten years. They
continued to follow a decreasing trend until 1997
(– 17 % and – 3 % compared to 1995 and 1996 respec-
tively) but recovered from 1997 up to the end of the
investigation period (+ 9 %).

it should be noted that

the relevant
In this respect
provisions of the Basic Decision and the WTO Anti-
dumping agreement state that
the determination of
injury shall be based on positive evidence of (a) the
volume of dumped imports and the effect of dumped
imports on prices on the Community market for like
products; and (b)
those
the consequent
imports on the Community industry. Moreover, they
specify that consideration shall be given to whether
there has been a significant increase in the volume of
dumped

impact of

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Official Journal of the European Communities

5. 2. 2000

to a significant degree or

imports, either in absolute terms or relative to consump-
tion in the Community. Furthermore, they also specify
that consideration shall be given to whether there has
been significant price undercutting by dumped imports
or whether the effect of such imports was to depress
to prevent price
prices
increases. No one or more of these factors can neces-
sarily give decisive guidance. Finally, they state that the
examination of the impact of dumped imports on the
domestic industry shall include an evaluation of all the
relevant economic factors and indices having a bearing
on the state of the industry, including the magnitude of
the actual margins of dumping, actual and potential
decline in sales, profit, output, market share, produc-
tivity, utilisation of capacity, factors affecting prices, etc.
The Basic Decision specifically states that this list is not
exhaustive, nor can any one or more of these factors
necessarily give decisive guidance.

(106)

In the present case, the investigation has shown that
imports of dumped imports have significantly increased
in absolute and relative terms. In addition, low-priced
dumped imports were found to significantly undercut
the Community industry's prices. All the above condi-
tions being met,
the Commission has evaluated the
potential and actual developments of a number of rele-
investigation before
vant
is
reaching its definitive conclusions. Accordingly,
considered that
the suggestion by some exporting
producers that only the level of profitability should have
warranted the termination of the proceeding is clearly
against the provisions of the Basic Decision.

economic

factors

in its

it

(107) Furthermore, the economic situation of the Community
industry during the investigation period, in particular its
price and profitability situation, must be seen in the light
of the structure of the hot-rolled coils market and the
developments that occurred in the economic situation of
the Community industry during the investigation period,
as set out in point 4 below.

(108) Finally, it is considered that the comparison of a specific
indicator pertaining to the Community
economic
industry with the same economic indicator worldwide
level
is not relevant in the context of anti-dumping
proceedings.

g) Investments and employment

(109) The investigation showed that investments were made
mainly in the replacement of machinery and equipment.
During the investigation period, the level of investment
was
Investments were
increased by 32 % as compared to 1995, consistent with
the high demand in 1997.

to the 1995 level.

similar

(110) As regards employment, the Community industry manu-
factures various products on the same site and with the
same machinery, notably hot-rolled coils. The invest-
igation showed that during the period examined
employment
the product
concerned decreased by 4 %.

the production of

for

h) Summary of

the situation of
between 1995 and the investigation period

the Community industry

(111) Some exporting producers claimed that a determination
of injury during the investigation period could not be
carried out on the basis of a comparison of the situation
of
the Community industry established in the years
1995 and 1997. They found that, in particular, price
and profitability levels in 1995, production, capacity
utilisation, sales volume and market share levels in 1997
were not representative of what their levels should be
under conditions of fair competition. They thus argued
that on the basis of the other findings over the entire
period examined, it could not reasonably be concluded
injury.
that the Community industry suffered material

(112)

In this respect it should be noted that,
in the above
claim, interested parties have not stated in which respect
some economic indicators established in 1995 and 1997
could not be considered representative. They merely
stated that prices and profits in 1995 and production,
capacity utilisation, sales volume and market share were
not representative.
the above claim
In other words,
suggests that a significant part of the data established
during the investigation carried out by the Commission
should be disregarded in the present proceeding without
any evidence or explanations indicating that the condi-
tions of normal competition were not met in 1995 and
1997. Given that during its investigation the Commis-
sion found no evidence to corroborate the allegation
that normal competition was not taking place on the
Community market during the years 1995 and 1997, it
is considered that there are no grounds to disregard such
information.

(113) The Commission thus examined the developments of
the economic situation of
the Community industry
within the period examined, and its overall economic
situation between 1995 and the investigation period, on
a yearly basis.

(114) The investigation showed that between 1997 and the
investigation period, with a slight increase in apparent
consumption,
the Community industry increased its
sales prices by 9 % but was not able to maintain its sales
the
volume, which decreased by 12 %. Accordingly,
Community industry lost 6,6 percentage points or 14 %
of market share. Furthermore, the Community industry
production decreased by 9 %, leading also to a reduced
capacity utilisation. Despite these negative developments
profitability increased from 6,3 % to 12,9 %.

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Official Journal of the European Communities

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(115) The investigation also showed that between 1997 and
the investigation period imports from the countries
concerned increased significantly in terms of volume
(+ 143 %), leading to a doubling of their market share
(+ 6,3 percentage points). Although the countries con-
cerned increased their sales prices by 7 % they were
nevertheless found to be undercutting the prices of the
Community industry by 8 % on average during the
investigation period.

4. Analysis of

the situation of

the Community

industry during the investigation period

a) Preliminary remarks

(116) The Community industry claimed that prices and thus
profits remained at a high level in the first half of the
investigation period because apparent consumption and
therefore demand was exceptionally high, even though it
was not matched by a commensurate actual consump-
tion. This led, in the first half of the investigation period,
to an overstocking which was largely fed by the imports
concerned, and, in the second half of the investigation
period, to a significant de-stocking.

for which there

(117) Furthermore, the Community industry indicated that a
more refined analysis of sales by product types and sales
channels
is head-on competition
between the Community industry and imports would be
necessary in the present case to show the full extent of
the injury suffered. This entails a differentiated analysis
of sales of black as opposed to pickled coils, and sales
channels where longer-term contracts are concluded as
opposed to other sales.

(118) Finally, the Community industry claimed that a more
detailed analysis of the four quarters of the investigation
period was necessary given the existence of a time lag
between orders placed by purchasers and deliveries
made to them. It was claimed that such time lags effec-
tively delayed the negative impact of
the imports
concerned. The Community industry claimed that it was

therefore necessary to further investigate the develop-
ment of orders received during the investigation period.

(119) All operators on the steel market agreed that business is
mainly carried out on a quarterly basis. Production is
organised on the basis of quarterly plans and prices.
Both orders and deliveries are negotiated accordingly.
the suggestion made by some exporting
Therefore,
producers that
the investigation
the partitioning of
period, in particular into quarters, did not constitute an
objective evaluation of the possible injury suffered by
the Community industry was not founded. The above
claims of the Community industry have therefore been
investigated and analysed as set out below.

(120)

In order to have an overview of the cyclical nature of the
activity of the Community industry and to cross check
the quarterly developments of its economic situation,
the Commission also collected quarterly data for the
period 1996 up to the second quarter of 1999.

b) Cyclical nature of the steel

industry

(121) According to the complainant, there are seasonal fluctu-
ations on the steel market in that the first two quarters
of each calendar year are normally better than the last
two quarters. Such seasonal fluctuations could mainly be
observed in sales activity. Sales would normally be
affected in the third quarter of the year due to the
holiday period in the user industries, but they should
pick up again in the fourth quarter. Given that some of
the above allegations made by the Community industry
required a quarterly analysis it was important to ensure
that any development observed did not merely reflect
normal quarterly fluctuations. This analysis was particu-
larly relevant as the complainant alleged that the trends
observed within the investigation period were far
beyond the normal cycles.

(122) For the evaluation of the cyclical nature of the hot-rolled
coil business, the Commission found that the trends in
production and sales for the Community industry from
1996 up to the investigation period were as follows:

Production
— 1996
— 1997
— IP (1998)

Sales volume
— 1996
— 1997
— IP (1998)

Sales value
— 1996
— 1997
— IP (1998)

1st
quarter

2nd
quarter

3rd
quarter

4th
quarter

(%)

93
97
100

87
97
100

100
95
100

97
100
94

90
100
87

96
100
88

95
97
77

91
97
68

89
99
63

100
97
70

100
97
61

94
98
51

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5. 2. 2000

(123) With regard to production, it was found that the third
quarter did not necessarily show the lowest level of
activity. In 1996 and 1997, the greatest difference found
was 7 % between the first and the fourth quarter of
1996 and the trend in production was linear in those
years. During the investigation period however the levels
of production in the third and in the fourth quarter were
far lower when compared to the first quarter, indicating
that the fluctuations observed in that period were far
beyond the normal seasonal fluctuations.

(124) Concerning sales volume, the downturn observed in the
third and fourth quarters was even more pronounced
during the investigation period. Sales activity in the
second half of the investigation period was exceptionally
low and far beyond the normal seasonal fluctuations.

(125) The above quarterly analysis covering the years 1996
and 1997 as well as the investigation period, shows that
the trends observed during this latter period are far
beyond the normal fluctuations linked to the cyclical
nature of the hot-rolled coil business.

c) Apparent consumption and overstocking

(126) As indicated in recital (61) above, the development of
apparent consumption on a yearly basis was quite stable,
in particular between 1997 and the investigation period.
It should be underlined that apparent consumption, by
definition, does not
i.e. actual
consumption of the product concerned by its users. The
difference between apparent consumption and actual
consumption is basically the quantity of stocks kept at
various levels of the distribution chain, i.e. in the present
case by importers, traders, dealers, SSCs and users.

reflect actual use,

in

apparent

consumption

(127) The examination of this particular issue showed that
apparent consumption was significantly higher in the
first two quarters of the investigation period than in the
last two quarters. In addition, the comparatively steady
development
found
throughout 1997 did not occur during the investigation
period. This difference in trends was particularly obvious
when comparing the end of 1997 and the beginning of
the investigation period, as there was a considerable
increase in apparent consumption between these two
time periods. This
suggests an increase in stocks,
whereas the reverse was true if the fourth quarter of
1997 is compared with the fourth quarter of the invest-
igation period, indicating a significant decrease in stocks
in the last two quarters of the investigation period.

(128) As it has been alleged that these stocks played a particu-
larly important role in the development of the market
during the investigation period, it was considered neces-
sary to establish the quarterly apparent consumption not
only for the investigation period but also for 1997.

(129) To confirm these findings,

the relevant development
should also have been established for actual consump-
tion. However, its determination was hampered by the
fact that cooperation of the various relevant interested
parties in the distribution chain and at user level was not
complete. Nevertheless,
the Commission was able to
establish the stocks held at trader's level on the basis of
Eurostat information gathered in the framework of the
ECSC Treaty.

(130)

In line with the above findings on apparent consump-
tion, this information showed that there was a consider-
able build-up of stock at trader level between the end of
1997 and the beginning of the investigation period. An
increase of 29 % between fourth quarter 1997 and first
quarter of the investigation period and a further increase
of 11 % between the first quarter of the investigation
period and the second quarter of
the investigation
period were observed.

(131) This information also confirmed a considerable decrease
in stocks towards the end of the investigation period
(– 22 %). The use of
clear when
comparing the level of stocks at the end of both the first
and second semesters of
the investigation period. A
comparison of the quarterly development of stocks in
1997 with the quarterly development during the invest-
igation period also confirms the above findings.

stocks became

(132) This trend of overstocking in the first two quarters of
the investigation period was confirmed in a submission
received by an exporting producer under investigation
and by the information from a major user of
the
product concerned on the Community market. This user
held stocks which in the middle of the investigation
period were more than double those held at the begin-
ning of this period, while there was no indication of a
significant difference in the underlying activity between
the beginning and the end of the investigation period by
this user.

(133) The investigation thus confirmed the Community indus-
try's claim that considerable overstocking occurred at
the beginning of the investigation period. In the first two
quarters of the investigation period apparent consump-
tion was significantly higher than actual consumption,
while for the third and fourth quarters of the invest-
igation period the difference was reversed.

(134)

In absolute terms, it was found that apparent consump-
tion during the first half of the investigation period
exceeded apparent consumption in the first half of 1997
by around 1,5 million tonnes.

largely

(135) Some interested parties claimed that the Community
to the overstocking
industry
contributed
observed during the first half of the investigation period.
In this respect it should be noted that, as shown below,
the Community industry's sales started to decline right
from the beginning of the investigation period. This
suggests that the Community industry did not play an
important role in feeding the overstocking observed.

d) Production and capacity utilisation

(136) On a quarterly basis, production decreased by 23 % in
the third quarter and by 30 % in the fourth quarter of
the investigation period as compared to the first quarter
of the investigation period.

(137)

In line with the decrease in production, the rate of
capacity utilisation also decreased by 12 % in the third
quarter of the investigation period and by 17 % in the
fourth quarter as compared to the first quarter of the
investigation period.

(138) Similarly,

it was found that production and capacity
utilisation were declining when compared with the rele-
vant quarterly activity in 1997. In the third and fourth
quarters of the investigation period as compared to the
third and fourth quarter of 1997, production decreased

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by 20 % and 11 % respectively, capacity utilisation by
12 % and 18 %.

e) Sales volume, sales prices and profitability

(143) The same was true when analysing the sales volume of
black compared to pickled coils. During the invest-
igation period the volume of pickled coils sold devel-
oped in a smoother way than that of black coils. The
decrease in the sales volume of black coil was as high as
39 % in the third quarter and 44 % in the fourth quarter
as compared to the first quarter of the investigation
period whereas the decrease in pickled coils was limited
to 21 % and 29 % respectively.

i) S a l e s v o l u m e

ii) S a l e s p r i c e s o f

t h e C o m m u n i t y i n d u s t r y

(139) The Community industry sales volume decreased by
32 % in the third quarter of the investigation period and
by 39 % in the fourth quarter as compared to the first
quarter.

(140) Furthermore, as already mentioned in the year-to-year
analysis, the Community industry claimed that a more
refined and differentiated analysis of its various types of
sales and sales channels should be made, as this would
show that the sales competing directly with the imports
concerned are more affected than other sales. In addition
to the differentiation between sales of black coils and
pickled coils, that industry claimed that a proportion of
its sales were the result of long-term delivery and sales
contracts, concluded, for example, with the automobile
industry. These contracts typically cover a period of up
to one year, during which delivery quantities and prices
are fixed. The exporting producers concerned do basi-
cally not supply the customers under such contracts.

(141)

In order to carry out a detailed analysis the above
mentioned types of sales were grouped and are referred
to as ‘long-term’ sales as compared to ‘other’ sales. Simi-
larly, the development of sales, sales prices and profit-
ability of black and pickled coils during the investigation
period were also analysed.

(142) The sales volume of long-term sales was much more
stable throughout
the investigation
the quarters of
period than the rest of the sales activity. Indeed, the
decrease in long-term sales was 20 % in the third quarter
and 22 % in the fourth quarter as compared to the first
quarter of the investigation period. The decrease in other
sales was much more pronounced namely 35 % and
43 % in the third and the fourth quarter respectively, as
compared to the first quarter of the investigation period.

(144) During the first two quarters of the investigation period
sales prices of hot-rolled coils were by and large stable,
namely at a level of ECU 306 and 308 per tonne
respectively. Subsequently they fell down to ECU 286
per tonne during the third quarter and to ECU 254 per
tonne during the fourth quarter of
the investigation
period. Overall this represents a decrease of 17 % during
the investigation period.

(145) The analysis of prices differentiated by types of sales
showed that prices for long-term sales largely remained
stable in the first three quarters of the investigation
period, only decreasing from ECU 320 per tonne to
ECU 312 per tonne, namely a decrease of 2 %. The
decrease was limited to 10 % when comparing the first
and the fourth quarter of the investigation period. By
contrast, prices for other sales had already decreased by
10 % between the first and the third quarter of the
investigation period and by 21 % between the first and
the fourth quarter of the investigation period.

(146) The comparison between the development of prices of
black coils and pickled coils showed that prices of the
former decreased much more than those of the latter.
The result of these differing trends was that prices across
categories differed significantly more at the end of the
investigation period than at the beginning. Indeed, prices
for pickled coils, only decreasing from ECU 328 per
tonne to ECU 316 per tonne, namely a decrease of 4 %.
The decrease was limited to 12 % when comparing the
first and the fourth quarter of the investigation period.
By contrast, prices for black coils had already decreased
by 10 % between the first and the third quarter and by
22 % between the first and the fourth quarter of the
investigation period.

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iii) P r o f i t a b i l i t y

Accordingly, the cost of raw material decreased limiting
the level of the losses incurred, particularly during the
investigation period.

(147) On a quarterly basis, it emerged that profitability was
the investigation
very good during the first half of
period. Given the precipitation of price decreases
throughout
profitability
continued to decrease, namely from 16,8 % during the
first quarter of the investigation period to – 2,6 % in the
fourth quarter.

subsequent

quarters,

the

(148) The differentiation in sales showed significant decreases
in profitability from the very start of the investigation
period for the sales of black coils and sales other than
the long term sales.

(149) The investigation showed that profitability for the long
term sales was very good in the first half of the invest-
igation period (around 21 %) and remained positive
throughout the investigation period, namely 8 % in the
fourth quarter of
the investigation period. Similarly
other sales were also profitable at around 16 % in the
first half of the investigation period. In line with the
development of demand for hot-rolled coils,
it subse-
quently collapsed in the third and the fourth quarter of
the investigation period to become negative (– 7 %) in
the fourth quarter of the investigation period.

(150) The same observations were made on profitability differ-
entiated for black coils and pickled coils where profit-
ability for both types was good in the first half of the
investigation period. Subsequently, profitability for
pickled coils remained positive throughout the invest-
igation period (4,5 % in the fourth quarter) whereas
profitability in black coils sales significantly decreased in
the third quarter of the investigation period and reached
a level of losses as high as – 16,5 % in the fourth quarter
of the investigation period.

(151)

In conclusion, overall sales, prices and profitability all
fell during the investigation period. This trend was
significantly less pronounced for sales made in market
segments where fewer dumped imports were present. In
terms of prices and resulting profitability, the situation
of the Community industry remained relatively stable
consumption
during the
boomed. The investigation has also shown that
the
Community industry did not increase its sales volume in
line with the increase in the apparent consumption. By
contrast, price levels and profitability remained at a high
level at a time of strong and increasing demand.

in which apparent

time

(153)

In order to complete the above analysis on sales volume,
sales prices and profitability,
it was found that these
economic indicators were also declining when compared
with the relevant quarterly activity in 1997. In the third
and fourth quarter of
the investigation period as
compared to the third and fourth quarter of 1997, sales
volume decreased by 24 % and 27 % respectively, sales
prices were 6 % and 19 % lower. As regards profitability,
it was found that it was 15 percentage points lower in
the fourth quarter of the IP as compared to the fourth
quarter of 1997.

(154) As shown in the chapter below, in assessing the devel-
opments in sales volume, sales prices and profitability it
is important to note that there is a time lag between
price negotiation with customers and invoicing and
delivery by the Community industry. Thus, when
considering in particular the developments in other sales
the prices applied during the first quarter of the invest-
igation period were in fact negotiated during the fourth
quarter of 1997 and so on.

f) Time lag between the situation of the Community industry

and the market developments

(155) As already mentioned in the year-to-year analysis above,
the Community industry alleged that,
in assessing its
price and profitability development, the existence of a
time lag between the sales of the goods and price nego-
tiation with customers related to such sales should be
considered. In practice, it was claimed, the negotiations
preceded the sales by at least one quarter.

(156) The investigation has shown that smooth production
planning for an effective capacity utilisation resulted in a
time lag between the order and the sale. This time lag
was indeed found to be around one quarter. In other
words sales in the first quarter of
the investigation
period are the result of orders negotiated and concluded
in the fourth quarter of 1997.

(152) The investigation also showed that the purchase prices
of major cost items in the cost of production decreased
during the investigation period. Notably, the price of
iron ore decreased by up to 12 % and scrap by up to
40 % and the price of oil dropped to the level of 1970.

(157) Given the existence of this time lag, the quarterly trend
established in the orders received by the Community
industry showed a significant decrease during the invest-
igation period. In line with the claim by the Community
industry, this negative trend is pronounced right from
the first quarter of the investigation period compared to
the trend determined for sales volume and production.

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The volume of the orders received in the second quarter
of the investigation period were 17 % lower than those
received in the first quarter. Furthermore, it emerged that
a relatively high level of orders was received in the
fourth quarter of 1997, corresponding to deliveries/sales
effected in the first quarter of the investigation period.

industry

(158) These findings are thus consistent with the claim by the
positive
that
Community
economic situation during the first half of the invest-
igation period merely reflects a healthy level of orders
received during the last quarter of 1997 and the first
quarter of
the investigation period, namely when
demand was still high.

relatively

the

g) Conclusion on the situation of the Community industry in

the investigation period

(159) The quarterly analysis indicated that the economic situa-
tion of
the Community industry deteriorated signifi-
cantly during the investigation period, in particular in
the second half. This deterioration went far beyond the
seasonal fluctuations observed during the previous years
on a quarterly basis.

(160)

In particular, it was found that in the third quarter of the
investigation period as compared to the average activity
of the period, all the injury indicators followed a nega-
tive trend: production decreased by 10 %, capacity utili-
sation by 6 %, sales volume by 14 %, sales prices by
2,4 % and profitability decreased by 2,1 percentage
points.

(161) Furthermore,

the developments observed during the
fourth quarter of the investigation period indicated that
the situation of the Community industry only deteri-
orated further: as compared to the average activity of the
investigation period, production decreased by 18 %,
capacity utilisation by 10 %, sales volume by 22 %,
prices by 13 % profitability became negative (– 2,6 % on
net turnover), a decrease of 15,5 percentage points.

5. Developments after the investigation period

(162) As mentioned above, the overstocking which occurred
during the first half of the investigation period led to a
relatively positive market situation reflected in the good
level of prices on the Community market during this
time period. Accordingly profitability of the Community
industry was still good. However, in view of the fact that
this situation was not supported by an underlying posi-
tive development in the user markets but was likely to
lead to negative developments after a certain time lag it
was considered necessary also to confirm this scenario
by analysing developments after the end of the invest-
igation period.

(163) As pointed out by some exporting producers it was
found that a certain degree of recovery occurred in the
volume produced and sold by the Community industry
at the beginning of 1999. However, it should be noted
that the level of production and sales were significantly
lower than those at the beginning of the investigation
period and those of 1997. In this respect, the invest-
igation showed that
the
Community industry continued to deteriorate after the
investigation period, in particular in terms of a decrease
in sales price and profitability during the two first quar-
ters of 1999.

the economic situation of

(164) This confirmed the negative effect of the massive over-
stocking which occurred at the beginning of the invest-
igation period and the de-stocking which began during
the investigation period and
the third quarter of
imports,
in actual
a decrease
continued, despite
throughout the first half of 1999. Apart from the effect
of overstocking, the delay with which the negative devel-
opment of the Community industry occurred was also
due to the time lag under which the Community
industry operates with its customers. This is apparent
not only from the development of the injury indicators
such as production, sales, prices and profitability, but
also from the development of the orders received by the
Community industry.

(165) Some parties have claimed that the imposition of anti-
in the present proceeding was
dumping measures
unnecessary as the imports concerned ceased after the
investigation period.

(166) The investigation showed that, based on generally avail-
able or unverified information, imports, in particular for
some of
the countries concerned by the present
proceeding, have fallen since the beginning of the invest-
igation period. However, this is not an unusual phenom-
enon in anti-dumping investigations as market partici-
pants, in particular importers, take into account the fact
that investigations require prudent assessment of the
market insofar as they can lead to the imposition of
anti-dumping measures. The reaction of market partici-
pants can be more or less pronounced. In any event,
taking into account the decrease in imports, which may
be limited in time,
to justify the non-imposition of
anti-dumping measures would allow the exporting
producers concerned to adopt a stop-and-go policy for
their exports.
this would have
is considered that
highly disruptive effect on the Community market for
any product and therefore can not
in the present
circumstances serve as a justification for not imposing
anti-dumping measures.

It

(167) Finally,

it has been claimed that the phenomenon of
high imports concentrated in the investigation period
was only short-lived. In the meantime market prices in
the Community have reached levels which ensure a
quick recovery of
the
Community industry.

the economic situation of

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(168)

It should be noted that detailed analysis demonstrates
that Community industry prices continued to deteriorate
and reached very low levels during the first two quarters
of 1999. This price decrease triggered considerable
financial losses, which the Community industry incurred
during a considerable period of time.

(173) The investigation then revealed that the above trends
would have been even more negative without specific
sales such as those under long term contracts or those of
pickled coils, which are less affected by the imports
concerned. The orders received by the Community
industry for delivery in the fourth quarter of the invest-
igation period were 31 % lower than those received for
delivery in the first quarter of the investigation period.

6. Conclusion on injury

industry

In addition,

(169) On the one hand, the year-to-year analysis of the situa-
tion of the Community industry in the period from
1995 to the investigation period showed a number of
negative developments.
the quarterly
analysis indicated that the economic situation of the
Community
deteriorated
significantly
throughout
the investigation period. Contrary to the
suggestion made by some exporting producers and
taking into account the special characteristics of the
Community market in terms of oversupply and time lag
between orders and deliveries these developments are
representative of
the
Community industry during the whole investigation
period.

situation of

economic

the

(170) The investigation has also shown that these negative
developments continued and even worsened after the
end of the investigation period, a development which is
particularly relevant in view of the functioning and the
situation of the Community market. It has been ascer-
tained that
far beyond the
seasonal fluctuations observed in previous years on a
quarterly basis.

this deterioration went

(171) To summarise, it was found that, during the third and
fourth quarters of the investigation period, all the injury
indicators followed a negative trend compared to the
average activity of the investigation period: production
decreased by 11 % and 18 % respectively, capacity utili-
sation by 6 % and 10 %, sales volume by 14 % and
22 %, sales prices were negotiated 2,4 % and 13 % below
the average price of the investigation period and profit-
ability decreased by 2,1 and 15,5 percentage points
respectively.

(172) Similarly it was found that these economic indicators
were also declining when compared with the relevant
quarterly activity in 1997.
In the third and fourth
quarter of the investigation period as compared to the
third and fourth quarter of 1997: production decreased
by 20 % and 11 % respectively, capacity utilisation by
12 % and 18 %, sales prices were 6 % and 19 % and
profitability was positive both in 1997 and during the
investigation period but it was 15 percentage points
lower in the fourth quarter of the IP as compared to the
fourth quarter of 1997. All these trends were confirmed
during the two quarters after the investigation period.

(174) On the other hand, the year-to-year analysis has shown
that average profit rates increased from 1997 to the
investigation period, reaching a level of 12,9 %. Profits
and sales prices remained stable during the first quarters
of the investigation period.

(175) Regarding these findings, which could at

first sight
appear to be contrary to a finding of injury, the invest-
igation has shown that they were in line with a high
level of apparent consumption during the first semester
of the investigation period which, the investigation has
confirmed, was not matched by actual consumption. As
a consequence, the prices and profits of the Community
industry (whose sales did not develop in line with the
overstocking) remained stable but were bound to deteri-
orate thereafter in view of the fact that the significant
apparent consumption was not met by a commensurate
actual consumption. Indeed, during the second part of
the investigation period, apparent consumption tumbled
as the massive stocks were used, which in turn provoked
a significant price and profit decrease.

(176) The subsequent analysis of the economic situation of the
Community industry in the first two quarters of 1999
confirmed that these negative trends were not confined
to the investigation period and were the direct results of
the developments during the investigation period. While
production and sales volume
improved somewhat
compared to the second half of the investigation period,
sales prices and profitability continued to decrease. It
should be noted that the Basic Decision as confirmed by
the jurisprudence of the Court permits the information
pertaining to the time period after the end of the invest-
igation period to be taken into account, in particular in
order to establish whether trends observed during the
investigation period continue.

(177) Based on the developments in the situation of

the
Community industry during the period from 1995 to
the investigation period and during the investigation
period in particular, the Commission has concluded that
the Community industry has suffered injury during the
investigation period. Contrary to the suggestion that the
economic
largely
showing
outweighed by other indicators showing lack of injury,
all
above detailed investigation showed that
the
economic indicators developed negatively, in particular
profits and sales prices with a time lag of a few months.
The magnitude of the injury suffered enables it to be
classified as material in accordance with the provisions
of Article 3(6) of the Basic Decision.

indicators

injury

are

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(178)

(179)

F. CAUSATION

1. Introduction

the market

In the present analysis it should be borne in mind that
the product concerned is a very price sensitive product.
for this product, as shown
In addition,
above, has a number of particular characteristics: the
relationship between the Community industry and
certain users is long-term; production set up and plan-
ning entails a certain time lag between order and
delivery; and the Community industry operates more in
certain market segments than the exporting producers
concerned. Nevertheless, these characteristics do not call
into question the fact that the products produced and
sold by the Community industry and those imported by
the countries concerned are like products. It only indi-
cates that certain sales channels and certain types of
product are more prone to competition from the
imports concerned than others.

suffered by

the Community

In order to reach its conclusions on the cause of the
industry,
injury
the
Commission examined the impact of
the dumped
imports from the countries concerned. At the same time,
the impact of other known factors and their possible
consequences on the situation of that industry were also
analysed. Such analysis ensured that any injury caused
by other factors than dumped imports would be identi-
fied and not attributed to these imports.

and covered 45 % of all
overall

increase of 229 % for the period examined.

imports, this represents an

(182) Consequently, the major increase in imports occurred
during the period 1997 to the investigation period and
particularly during the first two quarters. The invest-
igation showed that over 1,3 million tonnes were deliv-
ered onto the Community market during this six-month
period. This represents more than three times the import
volume of the second semester 1997. Between 1997
and the investigation period, the imports in question
increased by 143 % and the market share held by the
countries concerned more than doubled, namely an
increase of 6,3 percentage points.

(183) During the period from 1995 to the investigation period
while Community consumption increased by 9 %, the
Community industry's sales volume increased by only
1 % and it thus lost 3,7 percentage points of its market
share.

(184) As far as the period of the import surge (1997 to the
investigation period) is concerned, it coincided with the
the Community industry's situation.
deterioration of
Production decreased by 9 % and sales volume by 12 %.
The loss in market share amounted to 6,6 percentage
points and orders by 17 %.

(185)

(180) The other factors examined were: the development of
consumption, the oversupply of the Community market,
the impact of hot-rolled coils
imported into the
Community from other third countries, the behaviour of
other Community producers not included in the defini-
tion of
the export perfor-
mances of the Community industry and the world-wide
situation of the steel business.

the Community industry,

indicates

In addition, the development of import volumes, taken
together with the development of apparent consumption
shown earlier,
the dumped imports
concerned mainly fed the increase in stocks, and thus
the increase in apparent consumption in the first two
quarters of the investigation period, whereas the sales of
the Community industry decreased from the very begin-
ning of the investigation period.

that

2. Impact of dumped imports

a) Impact of the volume of dumped imports and stockpiling

tonnes

(181) The investigation showed that the imports concerned
increased considerably, in particular between 1997 and
the investigation period. While in 1995, only 0,65
hot-rolled
million
the
coils
of
Community market
from the countries concerned,
representing 17 % of total imports, in 1997, this rose to
0,88 million tonnes. During the period between 1995
and 1997, the increase in the volume of hot-rolled coils
imported from the countries concerned was limited to
0,2 million tonnes. During the investigation period the
volume of dumped imports reached 2,1 million tonnes

entered

(186) The investigation revealed that contrary to the exporting
producers in question the Community industry is not
very present in the traders' sales channel. As regards
certain large operators, it showed that these ordered few
or no hot-rolled coils from the Community industry
during the third and the fourth quarter of the invest-
igation period. This resulted in a significant drop in sales
which started during the third quarter of the invest-
igation period (– 28 %) and which continued (– 12 %)
during the fourth quarter. This in turn had a significant
negative influence on prices and profitability of
the
Community industry during the last two quarters of the
investigation period.

(187)

In order to fully assess this development it should be
borne in mind that the development of the situation of
the Community industry was particularly negative,
pronounced and immediate in sales channels and for
types in which the exporting producers are
product
these producers are not very
mainly active.

Indeed,

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Official Journal of the European Communities

5. 2. 2000

active in sales channels where long-term sales contracts
are concluded The Community industry has fared rela-
tively better in these sales channels than in others, where
competition from imports is more pronounced. It has
also been shown above that the Community industry's
sales of black coils, which account for around 90 % of
the imports concerned, have been developing very nega-
tively throughout the investigation period.

b) Impact of the import price level and functioning of the steel

market

(188) The investigation showed that

countries

from the

the situation of

the
Community industry remained stable in terms of prices
and therefore overall profitability during the first two
quarters of the investigation period, although import
prices
concerned continuously
decreased during the whole investigation period. In this
respect the investigation has shown that the develop-
ment of prices and profits of the Community industry
were due, on the one hand, to the general functioning of
the market in terms of the time lag between orders made
by and deliveries to clients and, on the other hand, by
the development of stocks and thus apparent consump-
tion during the investigation period.

(189) Concerning the general functioning of the market, it has
been found that given the time lag between orders and
the
deliveries (namely one quarter),
the situation of
Community industry during the first quarter of
the
investigation period, basically reflected the situation of
orders placed during the fourth quarter of 1997, when
imports started to increase.

(190)

In terms of the development of apparent consumption,
it has been found that the situation of the Community
market in general and of the Community industry in
particular during the first quarter of the investigation
period corresponded to a time period of spectacular
growth in stocks — and thus apparent consumption.
This allowed prices and profits to remain high despite
the increase in imports which occurred at the same time.
The dumped imports thus had the biggest impact on the
economic situation of the Community industry when it
became clear that the growth in stocks and thus in
apparent consumption was not matched by a growth in
actual consumption. Indeed, given the considerable fall
in demand for hot-rolled coils at the end of the invest-
igation period, Community industry prices decreased by
17 % and profitability became negative.

(191) The complainant claimed that at the end of 1997 and
during the entire investigation period the exporting
producers adopted a policy of systematic price decrease
and were continually undercutting the Community
industry's prices. This precipitated and hastened the fall

in sales prices on the Community market during that
period.

(192) The investigation showed that the exporting producers
indeed, reduced their price during the last quarter of
1997 while the Community industry attempted to main-
tain its price level until June 1998. In July 1998, the
Community industry reduced its sales prices. Their sales
prices, which were over 300 ECU/tonne in January
1998,
to around 250 ECU/tonne in December
1998.

fell

(193) This dramatic decrease in prices is explained by the fact
that the exporting producers continued to undercut the
Community industry's prices throughout
the invest-
igation period. It is to be noted that the level of the
undercutting was lower at the beginning of the invest-
igation period and became increasingly more significant
throughout the investigation period. The Community
industry had to reduce its prices in order to continue
from the
in particular
participating in the market,
middle of the investigation period onwards.

(194)

In this respect it is to be noted that steel is a major
commodity product and the indicative base price of
hot-rolled coils is published daily in specialised newspa-
pers and is well know by all operators present on the
market. The products produced and sold by the
Community industry and those imported by the coun-
tries concerned are highly sensitive to price movements
which are quickly transmitted through the market.

The above thus suggests that overall the findings of the
investigation show that the imports concerned caused
the negative development in the economic situation of
the Community industry.

c) Conclusion on the impact of dumped imports

(195)

is considered that

the high volumes of dumped
It
imports, which accumulated in the Community market
within a very short period, depressed prices and led to a
reduced market share of the Community industry. These
high import volumes allowed certain large Community-
based users to accumulate stocks with negative repercus-
sions on price negotiation with the Community industry
as early as in the second quarter of the investigation
period and to extend the period over which such
imports depressed prices. Moreover, given the general
transparency of the market, users and purchasers in the
Community market became quickly aware of the low
price policy applied by the exporting producers. This
precipitated and hastened the fall of sales price on a
market with negative results on market share and profit-
ability of the Community industry.

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Official Journal of the European Communities

L 31/35

(196) Consequently, it is concluded that the presence of low-
priced dumped imports played an important role in the
deteriorating situation of the Community industry and
thus to the material
injury suffered by that industry
during the investigation period.

(202)

3. Impact of other factors

the investigation has shown that

the
In conclusion,
increase in dumped imports was considerable (in terms
of market share imports more than doubled) during the
investigation period while it was
the
Community industry lost sales and experienced a drop
in production resulting in a fall in market share. Accord-
ingly, the increase in low-priced-dumped imports largely
contributed to the oversupply.

found that

a) Development of consumption

c) Imports of hot-rolled coils from other third countries

(197) During the period examined apparent consumption on
the Community market increased continuously by 9 %.
During the period between 1997 and the investigation
period apparent consumption increased by 0,4 %.

(198) Consequently, given the continuous positive develop-
ment in consumption volume since 1996, it is consid-
ered that it cannot be linked to the injurious situation
suffered by the Community industry during the invest-
igation period.

(203)

In addition to the countries concerned by the present
investigation, other countries exported hot-rolled coils
to the Community market. During the investigation
period the main exporters were Russia, Slovakia,
Romania, Hungary, South Korea and Indonesia.

(204) Some exporting producers argued that they have been
unduly discriminated against in comparison to some
other
third countries mentioned above which were
excluded from the scope of the investigation.

b) Oversupply of the Community market

(205)

(199) Certain exporting producers claimed that there was an
oversupply of the Community market at the beginning
of
the
the investigation period. They argued that
Community industry was continuously increasing its
deliveries on the market and was thus the main contri-
buting factor
they
argued that the high rate of capacity utilisation of the
Community producers resulting from high deliveries
should exclude any injury to be attributed to imports
from the countries concerned.

in the oversupply. Accordingly,

(200) The detailed analysis of the development in apparent
consumption in 1997 as compared to the investigation
period showed that during the first two quarters of the
investigation period apparent consumption was 1,4
million tonnes higher than in the corresponding quarters
of 1997. This comparison should be seen in the light of
the fact that 1,3 million of dumped hot-rolled coils were
imported from the countries concerned in the first two
quarters of the investigation period whereas the corre-
sponding volume imported in the same period in 1997
was about 0,3 million tonnes. This
represents an
increase of 1 million tonnes during the first half of the
investigation period.

(201) Furthermore,

it

is

traders

thus participating to the oversupply of

significantly
recalled that
increased their stocks in the first half of the investigation
period,
the
Community market. The investigation revealed that the
Community industry is not very active in the traders
sales channel whereas the exporting producers sold
significant quantities via
the
Community industry did not feed the stocks piled by
traders during the investigation period.

traders. Accordingly,

it

In this respect
that no complaint
is pointed out
against the above third countries was lodged and that
therefore no prima facie evidence of dumping and injury
justifying the initiation of an antidumping investigation
was received. As furthermore, the investigation has not
brought
injurious dumping
practices by such third country exports the allegation of
discrimination is not founded.

to light any evidence of

(206) During the period examined, other third countries' share
of total
imports of the product concerned onto the
Community market while remaining significant showed
a decreasing trend. The import volume decreased from
3,1 million tonnes in 1995 to 2,6 million tonnes in the
investigation period, namely a decrease by 17 % in terms
of volume. The share of these imports represented 83 %
of total import volume in 1995 but only 55 % during
the investigation period. Accordingly, throughout the
period examined, the share of the Community market
held by the other third countries decreased by 22 %.

(207)

Import prices from other third countries followed the
general downward tendency in the Community market
and decreased by 9 %.

(208) Based on the above facts and considerations it was
found that imports from other third countries remained
significant and enjoyed a continued presence in the
the period examined.
Community market during
However, it also emerged that while the situation of the
Community industry only deteriorated in particular from
1997 to the investigation period, namely when the
imports concerned surged massively,
the increase in
imports from other third countries was very limited.

L 31/36

EN

Official Journal of the European Communities

5. 2. 2000

(209) Accordingly, the suggestion by some exporting produ-
cers that the imports of hot-rolled coils from other third
countries are the cause of the injury suffered by the
Community industry cannot be taken into consideration.

d) Other producers in the Community

(210) During the investigation period, the producers in the
the
total

included in the definition of

represented

35 % of

Community not
Community
Community production.

industry

(211) Based on the information available, during the period
examined, the economic situation of the other producers
of hot-rolled coils in the Community was similar to that
of the Community industry. During the investigation
period their sales volume increased by 5 %, namely an
increase below the increase in consumption. Accord-
ingly, their share of the market in terms of volume
decreased by 4 %. Furthermore,
these producers also
suffered from price depression as the decrease in sale
value by 6 % indicates and their sales prices were in line
with those of the Community industry.

(212) Consequently, the impact of the other producers in the
Community on the deteriorating economic situation of
the Community industry was limited.

e) Export activity of the Community industry

(213) Certain exporting producers claimed that the situation of
the Community industry deteriorated because of
the
decrease in its export activity during the period exam-
ined.

(214) The investigation showed that the sales volume destined
for exports to third countries decreased by 536 000
tonnes between 1995 and the investigation period and
by 299 000 tonnes between 1997 and the investigation
period. This represents a decrease of 4,8 % and 2,9 %
sales of
respectively of
the Community
the total
the Commission does not
industry. On this basis,
exclude that such a decrease in the export sales affected
the overall economic situation of
the Community
industry. However, it is recalled that the present invest-
igation exclusively covered the economic situation of the
Community industry as regards the Community free
market. Consequently,
injury suffered by the
the
Community industry has been demonstrated on the
basis of Community market
indicators. Accordingly,
prices and revenues from export sales were irrelevant
and therefore excluded from the injury analysis.

f) Community industry's preference to supply captive market

(215) A number of users of the product concerned on the
Community market stated that the Community industry
had attempted to increase the integration of its activities
over the period examined. At the end of 1997, the
Community industry had allegedly given priority to
supplying related parties in the captive market before
supplying independent parties on the free market with
the result that the users were forced to obtain their
supplies from outside the Community. Therefore, injury
could not be caused by the development of imports.

(216) The Commission found that between 1997 and the
investigation period the evolution of sales volume to
both related and unrelated customers showed decreasing
trends. The fact that the supply to the captive market
that production
followed a similar
capacity was available. This decline in sales volume indi-
cated that
the
product concerned, which could have led to a decrease
in the sales volume to unrelated parties.

there was no shortage of supply of

trend indicates

g) World-wide situation in the steel business

(217) Several exporting producers claimed that the situation of
the Community industry, in particular in the second part
of the investigation period, was largely due to the deteri-
oration of the worldwide situation of the steel business.

(218) Based on the information available it emerged that a
worldwide downturn occurred during the investigation
period. Sales prices decreased in the USA, Japan and
South Korea. However, it was found that sales prices in
these countries were 15 %, 24 % and 7 % respectively,
higher than those in the Community at the end of the
investigation period.

(219) Consequently the worldwide situation of

the steel
industry and in particular the situation in Southeast
Asia, cannot explain the deterioration of the economic
situation of the Community industry during the period
examined.

4. Conclusion on causation

(220) The above analysis indicates that

factors other than
dumped imports from the countries concerned may
have contributed to the difficult state of the Community
industry during the investigation period. However, the
investigation has shown that
the sudden increase in
imports, the price depression and price undercutting
practised by the exporting producers had significantly
situation of
negative
the
consequences
Community industry. Therefore,
is concluded that
these imports, taken in isolation, had caused material
injury to the Community industry.

on the

it

5. 2. 2000

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Official Journal of the European Communities

L 31/37

G. COMMUNITY INTEREST

industry to recover from its injurious situation by either
increasing its own prices and/or sales quantities.

1. Preliminary remarks

(226)

(221) The purpose of anti-dumping measures is to remedy
unfair trading practices having an injurious effect on the
Community industry and re-establish a situation of effec-
tive competition on the Community market. In addition
to dumping,
injury and the cause of this injury, the
Commission examined whether any compelling reasons
existed which could lead to the conclusion that it is not
in the Community interest to impose measures. For this
purpose, and in accordance with Article 21(1) of the
Basic Decision, the impact of possible measures on all
parties involved in this proceeding and the consequences
of taking or not taking measures, were considered on
the basis of the evidence available.

2. Interest of the Community industry

(222)

In case of
injurious dumping caused by low-priced
dumped imports, the interest of a Community industry
is that conditions of effective competition are restored.

(223) The investigation has

shown that

the Community
market of hot-rolled coils was characterised by the pres-
ence of products originating in the countries concerned
which were sold at prices undercutting those of the
Community industry. The resulting injurious situation
could be contained as long as the volume imported was
limited. However, the high volume of dumped imports,
which suddenly flooded on the Community market in a
very short time during the investigation period, caused a
price depression, which had a significant impact on the
financial situation of
the Community industry. This
situation leaves the Community industry in a seriously
weakened position and this industry has an interest in it
being corrected.

(224) During the period examined, the Community industry,
as well as other producers located in the Community,
undertook important rationalisation and restructuring
projects that are still going on at present. The realisation
of these projects is important in view of the globalisa-
tion of the steel market. This activity of the Community
industry at a worldwide level demonstrates its adapt-
ability,

its competitiveness and viability.

(225) With anti-dumping measures in force, employment,
which increased during the period examined, could be
maintained and possibly increased, depending on the
evolution of consumption. The results of the invest-
igation have shown that the Community industry lost
significant sales volume and saw its prices decrease, in
particular towards the end of the investigation period.
The proposed anti-dumping duties, which amount to
around 8 % for cooperating exporting producers on a
weighted average level, should allow the Community

In view of the inadequate profitability in 1996 and 1997
and the material injury suffered during the investigation
period, it is highly probable that the financial situation
of the Community industry will deteriorate further in
the absence of any measures to correct the negative
effects of dumped imports. This may ultimately lead to
cuts in production or closures of certain facilities and
therefore threaten employment in the Community.

3. Interest of users and related activities in the

Community

(227)

In order to evaluate the impact on users of taking or not
taking measures, the Commission sent questionnaires to
the known users on the Community market. An on-the-
spot investigation took place at the premises of a major
user in order to verify the information submitted. The
following conclusions are based on the responses
received from users.

(228) Users were found to have themselves imported 40 % of
imports of hot-rolled coils from the countries
the

employ 4 000 people

in

total
concerned. They
Community.

they already held a share of 75 % of

(229) Users claimed that in the event of the imposition of
measures, they would no longer have a choice in their
they would
sources of supply and they feared that
become entirely dependent on the goodwill of
the
Community producers. In particular it was claimed that
these producers had to supply a large captive market
and that
the
Community free market. They recalled that these produ-
cers' sales on the captive market as well as a large share
of their sales on the free market was destined for related
companies, whose downstream products were in direct
competition with their own products. The users in ques-
tion also indicated that
the Community industry
supplied independent users only after the requirements
of their related companies had been fully satisfied. They
also claimed that the related user companies already
bought the product concerned below the market price.
Under
the
opinion that the imposition of anti-dumping measures
would give the Community industry a decisive and
unjustified competitive advantage in the downstream
markets which would not be in the interest of
the
Community.

these circumstances,

the users were of

(230) Finally, these users claimed that the imposition of anti-
dumping duties was likely to cause shortage of supply
for
in the
Community market at the end of 1997. This situation
would clearly be an infringement to the ECSC Treaty.

independent buyers, as was

the case

L 31/38

EN

Official Journal of the European Communities

5. 2. 2000

(231)

It is to be noted that the purpose of the imposition of
anti-dumping measures is not to prevent users from
importing hot-rolled coils from the countries concerned,
rather to ensure that these imports are made at non-
injurious prices. Even with the imposition of anti-
these products will always be
dumping measures,
present in the Community market and will ensure that
the choice of supply is maintained for users companies.

(232) The Commission estimated that a weighted average anti-
dumping duty of 8 % on hot-rolled coils imported from
the countries concerned may prompt at maximum an
increase of around 1.6 % in the overall cost of the user
companies' raw materials. This extra cost would cause
an estimated increase in the full cost of production of
about 1.1 %, given the mix of various sources of
purchases and the average value added in the down-
stream products.

(233) This estimated extra cost of production incurred by the
user companies, either charged or not to the subsequent
purchasers, is not such as to endanger the profitability of
the user industries. Moreover, this cost should be seen in
the light of expected positive developments in the hot-
rolled coils markets when governed by effective trade
conditions.

(234) Concerning the level of sales price in the free market, it
is recalled that no significant differences were found
between the prices applied by the Community industry
to related and unrelated customers. Moreover, the claim
purporting that the Community industry did not supply
or had set up priorities for its supplies of hot-rolled coils
depending on the relationship with the purchaser during
the period examined cannot be taken into consideration
as no evidence in this respect has been made available.
More to the contrary, it has been found that certain sales
contracts concluded with the Community industry were
cancelled.

(235) Based on the foregoing, it is considered that any nega-
tive effects on users from taking measures against
dumped imports from the countries concerned cannot
outweigh the positive effects from which all the other
operators active on the Community market will benefit.

may be the disappearance of many independent users
resulting in the reduction of employment
in the
Community.

(237) Concerning the alleged restriction in competition, it is
recalled that there are a number of alternative sources of
supply such as Russia, Indonesia, Hungary, Romania,
South Korea, Slovakia, Brazil, etc, exporting hot-rolled
coils to the Community. There are also several hundred
SSC's,
selling the product
concerned mainly to small and medium size users.
Finally, there are several Community steel producers, in
addition to the Community industry, located in Finland,
France, Austria and Greece.

stockholders and dealers

(238) Furthermore, given that

the level of

the measures
proposed is not such, from an economic point of view,
to foreclose the Community market to the countries
concerned there appears to be no risk of restricting
competition in the Community market.

5. Shortage of supply on the Community market

(239) Certain exporting

producers

from the

countries
concerned and users in the Community claimed that the
imposition of anti-dumping measures would cause a
shortage of supply, in particular for independent users
industries. This claim was based on the fact that the
Community industry alone is not able to supply the
whole Community free market in particular given its
current high capacity utilisation levels.

(240) Other interested parties claimed that the Community
industry does not have the capacity to supply its own
related companies in the free market and, is therefore
not in the position to compensate for any decrease in
imports caused by the imposition of anti-dumping
measures.

(241)

In this respect it should be noted that as the producers
in the Community cannot supply the whole of the free
market,
imports from third countries will always be
needed and the Community market will always been
open to such imports, provided they are made in respect
of the provisions of the Basic Decision.

4. Consequences on competition in the Community

market

(242)

(236) Some parties claimed that anti-dumping measures would
reduce competition on the Community market, encour-
aging the creation of big steel groups. They argued that
in the recent past major steel companies, such as British
Steel and Sollac, had increased in size by merging with
or by purchasing other steel companies. These groups
are also in competition in the downstream products
with independent users, mostly small and medium size
enterprises. The consequences of such a concentration

In any event, the Community industry, other producers
in the Community and exporting producers in other
third countries will be able to continue to supply the
Community market. The exporting producers in the
countries concerned will also be able to continue to
supply the Community market given that the measures
proposed are not such as to close the market to them.

(243) Based on the above facts and considerations, the claim
that the imposition of anti-dumping measures will entail
a shortage of supply is not considered to be founded.

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Official Journal of the European Communities

L 31/39

6. Conclusion on the Community interest

price of the comparable imported models. The difference
was then expressed as a percentage of the CIF import
price at the Community frontier customs duty unpaid.

(244) The Commission considers that the imposition of anti-
dumping duties is necessary to prevent further imports
of low-priced dumped imports and avoid the situation
of the Community industry to deteriorate further. More-
over, the imposition of measures in the present case will
re-establish effective competitive conditions for all oper-
ators in the Community. Furthermore, having examined
the various interests involved in the present proceeding,
no compelling reasons were found to exist against the
imposition of definitive anti-dumping measures. The
imposition of definitive anti-dumping measures is there-
fore not against the Community interest.

H. DEFINITIVE MEASURES

(245) Having established that the dumped imports originating
in Bulgaria, India, South Africa, Taiwan and Yugoslavia
have caused material injury to the Community industry
and that there are no compelling reasons not to take
action, definitive anti-dumping measures
should be
adopted.

1. Injury elimination level

(246) For establishing the level of duty, account has been
taken of the dumping margins found and of the amount
of the duty necessary to eliminate the injury caused by
dumped imports to the Community industry. The neces-
sary price increase was determined on the basis of a
comparison of the weighted average import price, as
established for the undercutting calculations, with the
non-injurious price of the different types of hot-rolled
coils
industry on the
sold by
Community market.

the Community

(247)

It was considered that the amount of duty necessary to
remove the effects of injurious dumping should allow
the Community industry to cover its costs of production
and obtain a reasonable profit on sales. In this respect, it
was considered that the profit margin before tax of
12,9 % on turnover claimed by the Community industry
was an appropriate basis, regard being given to the need
for long-term investments and for a rate of return,
which the Community industry could reasonably expect
in the absence of injurious dumping.

(248) Accordingly and given the profit rate realised by the
Community industry during the investigation period,
injury elimination levels were determined on a type by
type basis as the difference between the actual net sales
price of the Community industry and the actual net sales

2. Level of definitive duties

(249)

In the light of the foregoing,
it is considered that a
definitive anti-dumping duty should be imposed at the
level of the dumping margin found, but should not be
higher than the injury margin set out above in accord-
ance with Article 9(4) of the Basic Decision.

(250) As far as the parallel anti-subsidy proceeding regarding
imports
from India, South Africa and Taiwan is
concerned it should be noted that, in accordance with
Article 12 (1) of Commission Decision No 1889/98/
ECSC, the countervailing duty rate should correspond to
the subsidy margin unless the injury margin is lower.

(251)

(252)

(253)

(254)

In accordance with Article 24(1) of the above Decision
No 1889/98/ECSC and Article 14(1) of
the Basic
Decision, no product shall be subject
to both anti-
dumping and countervailing duties for the purposes of
dealing with one and the same situation arising from
dumping or from export subsidisation. As anti-dumping
duties should be imposed on imports of the product
concerned it is necessary to determine whether, and to
what extent, the subsidy and the dumping margin arise
from the same situation.

In the case in question all of the schemes investigated in
India have been found to constitute export subsidies
within the meaning of Article 3(4)(a) of
the above
Decision No 1889/98/ECSC. As such, the subsidies can
affect the export prices of the Indian exporting produ-
cers, thus leading to increased margins of dumping. In
other words,
the dumping margins established are
wholly or partly due to the existence of export subsidies.
In these circumstances it is not considered appropriate
to impose both countervailing and anti-dumping duties
to the full extent of the relevant subsidy and dumping
margins established. Therefore, in the case of India, the
anti-dumping duties need to be adjusted to reflect the
actual dumping margins remaining after the imposition
of the countervailing duties offsetting the effect of the
export subsidies.

In the case of Taiwan, the schemes investigated do not
constitute export subsidies. Accordingly, duties may be
imposed at the rates of the full amount of dumping and
subsidy margins established,
to the injury
margins not being exceeded.

subject

In the case of South Africa, as the level of subsidisation
was found to be de minimis, no countervailing duties are
imposed at the present stage. In these circumstances,
anti-dumping duties at the full rate of the injury margins
are imposed given that
than the
dumping margins.

these are lower

(1) OJ L 245, 4.9.1998, p. 3.

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EN

Official Journal of the European Communities

5. 2. 2000

(255) The rates of duty applicable to the free-at-Community-frontier price, before duty and taking into

account the results of the anti-subsidy proceeding, shall be:

Country/Company

Dumping
margin %

Injury
margin %

Export
subsidy
margin %

Proposed
countervailing
duty %

AD
duty to
be imposed %

Bulgaria

Kremikovtzi

India

Essar

SAIL

TISCO

South Africa

Iscor

Highveld & Vanadium

Taiwan

CSC

Yieh Loong

Yugoslavia

Sartid

27,1

27,1

56,3

55,8

56,3

29,4

47,8

47,8

37,8

30,3

8,8

2,1

56,1

56,1

7,5

7,5

23,8

6,4

23,8

6,4

38,3

5,2

38,3

29,3

8,9

3,9

15,4

15,4

14,8

4,9

12,3

8,7

0

0

0

0

0

0

14,8

4,9

12,3

6,4

0

0

0

4,4

4,4

0

7,5

7,5

9,0

1,5

11,5

0

37,8

5,2

37,8

24,9

3,9

2,1

15,4

15,4

(256) The individual company anti-dumping duty rates specified in this Decision were established on the
basis of the findings of the present investigation. Therefore, they reflect the situation found during
that investigation with respect to the above companies. These duty rates (as opposed to the
country-wide duty applicable to ‘all other companies’) are thus exclusively applicable to imports of
products originating in the country concerned and produced by the companies and thus by the
specific legal entities mentioned. Imported products produced by any other company not specifically
mentioned in the operative part of this Regulation with its name and address, including entities
related to those specifically mentioned, cannot benefit from these rates and shall be subject to the
duty rate applicable to ‘all other companies’.

(257) Any claim requesting the application of these individual company anti-dumping duty rates (e.g.
following a change in the name of the entity or following the setting up of new production or sales
entities) should be addressed to the Commission (1) forthwith with all relevant information,
in
particular any modification in the company's activities linked to production, domestic and export
sales associated with e.g. that name change or that change in the production and sales entities. The
Commission, if appropriate, will, after consultation of the Advisory Committee, amend the Decision
accordingly by updating the list of companies benefiting from individual duty rates.

(1) European Commission Directorate-General Trade Directorate C DM 24 - 8/38 Rue de la Loi/Wetstraat 200 B - 1049

Brussels/Belgium

5. 2. 2000

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Official Journal of the European Communities

L 31/41

3. Undertakings

(258) Exporting producers in Bulgaria, India, South Africa have offered a price undertaking in accordance

with Article 8(1) of the Basic Decision.

(259) One exporting producer in Yugoslavia expressed its willingness to give a price undertaking. However,
in view of a number of problems relating to the product code number and the fact that a majority of
sales to the European Union were made via related companies, it was considered that the Commis-
sion would be unable to monitor the undertaking properly. The exporter‘s offer was therefore
rejected and the company was informed accordingly, in accordance with Article 8(3) of the Basic
Decision.

(260) The Commission considers that the undertaking offered by the exporting producers in Bulgaria, in
India, and in South Africa can be accepted. The acceptance of the price undertaking should be
conditional on the presentation to the Member States' customs services of a valid undertaking
invoice clearly identifying the producer and containing the information listed in the Annex. Where
no such invoice is presented, the appropriate rate of anti-dumping duty will be payable.

(261)

It should be noted that in the event of a breach or withdrawal of the undertaking an anti-dumping
duty may be imposed, pursuant to Articles 8(9) and 10 of the Basic Decision.

I. TERMINATION OF THE PROCEEDING

(262)

In view of the findings on the level of imports originating in Iran, the proceeding with respect to this
country should be terminated,

HAS ADOPTED THIS DECISION:

Article 1

1.
A definitive anti-dumping duty is hereby imposed on imports of certain flat rolled products of iron or
non-alloy steel, of a width of 600 mm or more, not clad, plated or coated, in coils, not further worked
than hot-rolled originating in Bulgaria, India, South Africa, Taiwan or the Federal Republic of Yugoslavia
falling within CN codes 7208 10 00, 7208 25 00, 7208 26 00, 7208 27 00, 7208 36 00, 7208 37 10,
7208 37 90, 7208 38 10, 7208 38 90, 7208 39 10, 7208 39 90.

The rates of duty for products manufactured by the companies listed in the table below applicable to

2.
the free-at-Community-frontier price, before duty, shall be:

Country

Company

Rate of AD duty
(%)

TARIC additional code

Bulgaria

All companies

India

South Africa

Essar Steel Ltd, 27th KM, Surat Hazira Road,
Hazira 394270, Dist: Surat, State: Gujarat

Steel Authority of India Limited, Ispat Bhavan,
Integrated Office Complex, Lodhi Road, New
Delhi-110 0031

Tata Iron & Steel Company Limited,
43 Chowringhee Road, Calcutta-700 071

All other companies

Iscor Limited, Roger Dyason Road, Pretoria
West, and Saldanha Steel (Pty) Ltd, Private Bag
X11, Saldanha 7395

All other companies

7,5

1,5

11,5

0

9

5,2

37,8

A999

A076

A077

A078

A999

A079

A999

L 31/42

EN

Official Journal of the European Communities

5. 2. 2000

Country

Company

Rate of AD duty
(%)

TARIC additional code

Taiwan

China Steel Corp., 1 Chung Kang Road, Hsiao
Kang, Kaohsiung 81233

Yieh Loong Enterprise Co, Ltd., 317 Yu Liao
Road, Chiao Tou Hsiang, Kaohsiung Hsien

All other companies

Federal Republic
Yugoslavia

of

All companies

3,9

2,1

24,9

15,4

A080

A081

A999

—

Notwithstanding paragraph 1, the definitive duty shall not apply to imports realised for free circula-

3.
tion in accordance with the provisions of Article 2.

4.

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

1.

The undertakings offered in connection with this anti-dumping proceeding by

Article 2

Company

Country

TARIC additional code

Kremikovtzi Corporation, 1870 Sofia, Botunetz

Bulgaria

Essar Steel Ltd, 27th KM, Surat Hazira Road,
Hazira 394270, Dist: Surat, State: Gujarat

India

Steel Authority of India Limited, Ispat Bhavan,
Integrated Office Complex, Lodhi Road, New
Delhi-110 0031

India

Highveld
Limited, PO Box 111, Witbank 1035

Steel & Vanadium Corporation

South Africa

A082

A083

A084

A085

are hereby accepted.

2.
Imports pursuant to these undertakings, when released for free circulation, shall be exempted from
the anti-dumping duty set in Article 1(2) when they are manufactured and directly exported and invoiced to
an importing company in the Community by a company listed in the table of paragraph 1 and declared
under the appropriate TARIC additional code.

The exemption shall be conditional upon presentation to the relevant Member State's customs services of a
valid undertaking invoice issued by the exporting company containing the essential elements listed in the
Annex.

Article 3

Pursuant to Article 14(6) of Decision (EC) No 2277/96/ECSC, Member States' reports to the Commission
shall indicate for each release for free circulation, the year and month of import, the CN code, Taric and
Taric additional codes, the type of measure, the country of origin, the quantity, the value, the anti-dumping
duty, the Member State of import and, where appropriate, the serial number of the production certificate.

Article 4

The anti-dumping proceeding concerning imports of certain flat-rolled products of iron or non-alloy steel,
of a width of 600 mm or more, not clad, plated or coated, in coils, not further worked than hot-rolled
originating in Iran is hereby terminated.

5. 2. 2000

EN

Official Journal of the European Communities

L 31/43

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

Article 5

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

Done at Brussels, 4 February 2000.

For the Commission

Pascal LAMY

Member of the Commission

ANNEX

Elements to be indicated in the undertaking invoice referred to in Article 2(2)

1. The product reporting code number (PRC) (as established in the undertaking offered by the exporting producer in

question),

including type and CN code.

2. The exact description of the goods,

including:

— invoice number,
— invoice date,
— the ‘company product code’ (CPC),
— the TARIC additional code under which the goods on the invoice may be customs-cleared at Community borders

(as specified in the Decision).
— quantity (to be given in kilos),
— minimum price applicable.

3. The description of the terms of the sale including:

— price per kilo,
— the applicable payment terms,
— the applicable delivery terms,
— total discounts and rebates.

4. Name of the importer to which the invoice is issued directly by the company.

5. The name of the official of the company that has issued the undertaking invoice and the following signed declaration:

‘I, the undersigned, certify that the sale for direct export to the European Community of the goods covered by this
invoice is being made within the scope and under the terms of the undertaking offered by... [name of the company]
and accepted by the European Commission through Decision (EC) No 283/2000/ECSC. I declare that the information
provided in this invoice is complete and correct.’