Council Regulation (EC) No 2011/2000 of 18 September 2000 imposing a definitive anti-dumping duty on imports of fluorspar originating in the People's Republic of China
Date: 2000-09-18
Institutions: Council of the European Union
Subjects: China, anti-dumping duty, dumping, fluorine, import, originating product

26.9.2000

EN

Official Journal of the European Communities

L 241/5

COUNCIL REGULATION (EC) No 2011/2000

of 18 September 2000

imposing a definitive anti-dumping duty on imports of fluorspar originating in the People's
Republic of China

THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty establishing the European
Community,

Having regard to Council Regulation (EC) No 384/96 of 22
December 1995 on protection against dumped imports from
countries not members of the European Community (1), and in
particular Articles 9, 11(2) and 11(3) thereof,

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

Whereas:

A. PROCEDURE

1. Measures in force

In March 1994, definitive anti-dumping measures were
imposed by Council Regulation (EC) No 486/94 (2) in
the form of a variable duty associated with a minimum
price of 113,50 ECU per tonne on imports of fluorspar
originating in the People's Republic of China (‘the PRC’).
The original
investigation period covered the period
from 1 January 1991 to 30 March 1992.

2. Initiation of the review

fluorspar originating in the PRC (3),

Following the publication of a notice of
impending
expiry of the anti-dumping measures in force on imports
of
in December
to review
1998,
these measures pursuant to Article 11(2) of Council
Regulation (EC) No 384/96 (the ‘basic Regulation’).

the Commission received a request

The request was lodged by Eurometaux, (‘the applicant’)
acting on behalf of Community producers representing
more than 95 % of the total Community production of
fluorspar.

The request was based on the grounds that the expiry of
the measures would be likely to result in the continua-
recurrence of dumping and injury to the
tion or
after
Community
sufficient
consulting the Advisory Committee,
evidence existed for the initiation of a review pursuant

determined,
that

industry. Having

(1)

(2)

(3)

(4)

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

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

(2) OJ L 62, 5.3.1994, p. 1.
(3) OJ C 276, 4.9.1998, p. 2.

(5)

(6)

(7)

(8)

to Article 11(2) of the basic Regulation, the Commission
initiated a review (4).

At the same time, the Commission decided to initiate a
review, on its own initiative, pursuant to Article 11(3) of
the basic Regulation, limited in scope to the form of the
duty. This decision was based on the grounds that the
effectiveness of
the measures to remove the injury
appeared to be undermined given the continuous decline
of the market share held by the Community industry
following the imposition of measures, and that export
prices of Chinese fluorspar appeared to have remained
below the level of the minimum price.

3. Investigation

the

advised

The Commission officially
applicant
Community producers, the exporters and producers in
the exporting country, the importers as well as their
representative associations known to be concerned, and
the representatives of the exporting country of the initia-
tion of the review. The Commission sent questionnaires
to all these parties and to those who made themselves
known within the time limit set out in the notice of
initiation. In addition, a producer in South Africa, which
was chosen as analogue country, was advised and
received a questionnaire. The Commission also gave the
parties directly concerned the opportunity to make their
views known in writing and to request a hearing.

All the applicant Community producers replied to the
questionnaire. Nine Chinese exporters/traders, all of
them members of the China Chamber of Commerce of
Metal, Mineral, and Chemical Importers and Exporters
(‘CCCMC’), replied to the exporters/traders questionnaire.
In addition, Cometals, New York, United States of
America, an independent trader of Chinese fluorspar,
and CMC Trading AG, Zug, Switzerland, completed the
exporters/traders questionnaire.

The Commission sought and verified all information it
deemed necessary for the purpose of a determination of
the likelihood of a continuation or
recurrence of
dumping and injury and of the Community interest.
Verification visits were carried out at the premises of the
following companies:

(4) OJ C 62, 4.3.1999, p. 3, as amended by OJ C 120, 1.5.1999,

p. 23.

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Official Journal of the European Communities

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(a) applicant Community producers

— Minersa, Bilbao, Spain;

— Nuova Mineraria Silius, Cagliari, Italy;

— Sachtleben Bergbau, Lennestadt, Germany;

— Sogerem, Albi, France.

(b) users in the Community:

— Ausimont SpA, Milan, Italy;

— Bayer, Leverkusen, Germany;

— Fluorsid, Assemini, Italy;

— ICI Chemicals, Runcorn, United Kingdom

(9)

recurrence of
The investigation of continuation or
dumping covered the period from 1 March 1998 to 28
February 1999, in particular the months of March and
September 1998 and February 1999, (‘IP’). The exam-
ination of continuation or recurrence of injury covered
the period from 1 January 1993 up to 28 February
1999 (hereinafter referred to as ‘the period examined’).

B. PRODUCT UNDER CONSIDERATION AND LIKE

PRODUCT

1. Product under consideration

(10)

CN code

ex 2529 22 00

The product under consideration is fluorspar of both
acid and ceramic grade presented in filter cake or in
powder form, with a content of 97 % or less of calcium
fluoride (CaF2) falling under CN code ex 2529 21 00
(TARIC code 2529 21 00 10), as well as with a content
) falling
of more than 97 % of calcium fluoride (CaF2
under
code
(TARIC
2529 22 00 10) (‘fluorspar’). In order to produce fluor-
spar, ore has to be mined, crushed and floated. The
result is fluorspar with various calcium fluoride contents.
Fluorspar in filter cake form and in powder form differs
only in its moisture content, but is perfectly interchange-
able in its use. Fluorspar is used essentially as a feedstock
in the manufacture of hydrofluoric acid. This product is
largely employed in the production of fluorocarbons, the
basic acid products for aerosols, refrigerants and plastic
foam; the production of aluminium fluoride used in the
aluminium sector and the production of fluorine chemi-
cals such as solvents. Since all types of fluorspar have
identical or similar physical and chemical characteristics
and identical uses, as in the investigation leading to the
measures presently reviewed, they are considered as one
single product.

2. Like product

(11) As

established in the previous

investigation and
confirmed in this investigation, fluorspar exported to the
Community from the PRC, fluorspar manufactured and
sold by the Community industry on the Community
market and fluorspar produced and sold on the

domestic market of the analogue country, are identical
or bear a close resemblance in their basic physical and
chemical characteristics and in their uses.

This conclusion was reached taking into account the fact
that fluorspar is mined and processed in similar ways,
despite differences in methods of extraction,
in CaF2
content of the deposit and in production method which
may vary from producer to producer world-wide and
also within the Community. This is confirmed by the
that both the Community producers and the
fact
Chinese
common
customers.

exporters have

a number of

(12)

In view of the above, the fluorspar exported to the
Community, that sold on the domestic market in South
Africa and that produced and sold on the Community
market are to be considered a like product within the
meaning of Article 1(4) of the basic Regulation.

C. LIKELIHOOD OF CONTINUATION OF DUMPING

imports of

(13) Despite the imposition of anti-dumping measures, the
volume of
fluorspar from the PRC grew
significantly during the period of enforcement of the
measures going from 62 935 tonnes
in 1995 to
155 200 tonnes in the year 1998, which covers the
main part of the IP as defined in recital 9. It has been
examined whether dumping continued or was likely to
continue during the IP.

1. Normal value

(a) Analogue country

(14) Normal value for imports from the PRC was based, in
accordance with Article 2(7) of the basic Regulation, on
data from a market economy third country. South Africa
was selected in the original investigation as an appro-
priate market economy third country. It was, therefore,
envisaged in the notice of initiation of this review to
retain this country for the determination of normal
value. One cooperating exporter/trader and several
Community users of
fluorspar submitted that South
Africa was inappropriate on the grounds that the access
to raw materials in South Africa is more difficult than in
the PRC. In particular, it was submitted that mines of
fluorspar in South Africa do not enjoy the same natural
advantages as those in the PRC, and that as a result the
extracting and processing costs are higher in South
African mines than in Chinese mines; however, these
parties did not argue that the circumstances prevailing
during the previous investigation had changed. These
parties
suggested Mexico and Kenya as alternative
analogue countries in which, it was claimed, the natural
conditions were comparable to those prevailing in the
PRC.

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Official Journal of the European Communities

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(15)

In this respect, the Commission sought cooperation in
countries where fluorspar was known to be produced in
sufficient quantities. In particular, a request for coopera-
tion was addressed to one producer in South Africa, one
in Morocco, four in Mexico, and one in Kenya. Only the
South African producer cooperated fully. None of the
other companies approached responded to the question-
naire within the time limit set for the response. The
Kenyan producer submitted an incomplete response
beyond the time-limit.

(16) Given that cooperation of a representative South African
producer was obtained, and as other countries were
considered less appropriate as analogue countries, this
country was retained as analogue country.

(17)

(18)

It should be noted in this respect that the South African
cooperating producer had representative domestic sales
(see recital 20), whereas the above mentioned Kenyan
producer did not have any domestic sales.

The extraction method, quality and production process
of the South African producer can be considered as
similar to that of the Chinese producers, as established
led to the measures under
in the investigation that
review. The alleged difference in access to raw materials
between South Africa and the PRC has been duly treated
as in the original investigation when comparing export
price and normal value (see recital 26). All parties were
duly informed on the final selection of South Africa as
analogue country.

2. Export price

(21)

In accordance with Article 17 of the basic Regulation,
given that
the number of Chinese exporters/traders,
members of CCCMC, willing to cooperate was large, the
investigation was limited to a sample of
the export
transactions made by nine of
the above-mentioned
exporters/traders. Their export transactions collectively
i.e.
accounted for a representative volume of exports,
70 % of the total imports into the Community of the
product concerned from the PRC in 1998, the period for
which data was available at the time of the selection of
the sample.

(22) As the Chinese exporters/traders sold for export to unre-
lated importers in the Community, the export price was
established, in accordance with Article 2(8) of the basic
Regulation, on the basis of the export prices actually
paid or payable for export to the Community.

(23)

The cif Community border prices used were based on
the prices declared by the cooperating US exporter/
trader Cometals and the calculated prices resulting from
the data submitted by the cooperating Chinese expor-
ters/traders. Given that the cooperating Chinese expor-
ters/traders sold to the Community on a fob ex-PRC
basis, their cif values were determined by adding to
those prices a reasonable amount for ocean freight and
insurance as established on the basis of
information
submitted by cooperating Community users.

(b) Normal value determination

3. Comparison

(19) Normal value was established on the basis of the infor-
mation provided by the cooperating South African
producer. The name of the company is not disclosed
herewith as its cooperation could only be secured
provided a strict guarantee of confidential treatment of
its identity would be granted by the Commission.

(20)

slightly less

than 5 % of

In accordance with Article 2 of the basic Regulation, it
was
the
first examined whether domestic sales of
product concerned were representative in relation to the
Chinese exports to the Community. The domestic sales
of the South African cooperating producer were found
total
to represent
Community imports from the PRC during the IP, while
being generally above 5 % during the period of enforce-
ment of measures. In these circumstances, the Commis-
sion considered that the domestic sales in South Africa
to the
were
It was further established that domestic
Community.
sales were made in the ordinary course of trade,
i.e.
domestic prices provided for the recovery of all cost.
Therefore, the selling price in the domestic market was
used as basis for the calculation of normal value.

representative

for Chinese

exports

the

(24)

For the purpose of ensuring a fair comparison between
normal value and export price, account was taken of
differences in factors, which were demonstrated to affect
prices and price comparability in accordance with
Article 2(10) of the basic Regulation.

(25) Adjustments for differences in physical characteristics,
insurance, handling charge and credit were

transport,
made.

(26)

Two adjustments, in respect of physical characteristics,
deserve special consideration:

— Chinese exports of

fluorspar to the Community
market are made in wet form, whereas domestic
sales made by the
cooperating South African
producer on the South African market are made in
dry form. As in the previous investigation, an adjust-
ment to the normal value was made and has been
based on a reasonable estimate of the difference in
market value between fluorspar presented in dry and
wet
i.e. cost of drying plus a reasonable
amount for SG&A and profit.

form,

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— The investigation that led to the imposition of the
measures under review established that
the PRC
enjoys natural advantages over South Africa by
reason of the easier access to raw material which, in
turn, has an impact on the purity of the product, and
in this respect certain costs are incurred in
that
South Africa but not in the PRC. Accordingly,
in
order to offset this difference affecting price compar-
ability, an adjustment to normal value was granted
within the framework of the original investigation.
in question
Given that
continued to exist, it was decided for the purpose of
the present review to apply the same adjustment to
investigation.
the normal value as in the original

the natural

advantage

(27)

The cooperating Chinese exporters/traders claimed an
adjustment for differences in levels of trade on the basis
that the South African cooperating producer sells to
users and the Chinese exporters/traders sell to importer/
traders. After further analysis of
it was
concluded that there was a difference in levels of trade
that merited an adjustment. Since the cooperating South
African producer does not sell to the two different levels
of trade under consideration, the adjustment was esti-
mated, pursuant to Article 2(10)(d)(ii), as 10 % of its
gross margin in accordance with the established practice
of the Community Institutions.

the matter,

4. Dumping margin

(28)

The comparison of the weighted average export price
with the weighted average normal value showed still the
existence of dumping during the IP, the dumping margin
being equal to the amount by which the normal value
exceeded the export price (expressed as a percentage of
the cif import prices at the Community border, duty
unpaid). However, the dumping margin found was lower
It
than that established in the original
should also be noted that the reduced level of dumping
is in essence due to the rise in export prices which
reflect the Chinese export licence system and the form of
the anti-dumping duty (i.e. the variable duty).

investigation.

(30)

(31)

(32)

D. LIKELIHOOD OF RECURRENCE OF DUMPING

1. Preliminary remarks

Further to the establishment of
the continuation of
dumping during the IP, the likelihood of recurrence of
dumping, should the measures in question be removed,
was examined. For that purpose, the following factors
were examined: the evolution of Chinese export prices
from 1993 to the IP, the impact of the export licence
system introduced by the Chinese authorities in 1994
and the situation in the PRC as regards fluorspar produc-
tion, production capacity and stocks.

2. Evolution of Chinese export prices

to the

Community

Parallel to the imposition of anti-dumping measures,
export prices of Chinese fluorspar have progressively
increased and have, on average and on a cif at
Community frontier basis, come close to the minimum
price of ECU 113,5 per dry metric tonne. In particular
prices went from ECU 86 in 1993 to ECU 111 per dry
metric tonne in 1998. This appears to indicate that the
minimum price acted as an incentive for a price increase.
Therefore, it is likely that the removal of the measures
would reverse the situation and bring about a decrease
of export prices.

3. The impact of the Chinese export licence system

The Chinese government introduced in 1994 a regula-
tory system consisting of an annual export quota
combined with an export licence fee that covered a
number of minerals including fluorspar. It should be
noted that the introduction of the export license system
coincided with the imposition of anti-dumping duties on
fluorspar, and the existence of anti-dumping duties on
other minerals covered. The declared object was to stabi-
fluorspar and other
lise the exported volumes of
minerals, as well as preventing export prices from falling
under the pressure of internal competition. It actually
had an impact in increasing the Chinese export prices to
the Community. The quota was lifted in 1998, and
reintroduced in 1999, while the export licence fee has
remained in force since its introduction. Export licences
are auctioned and awarded to the highest bidders or to
the bidders that are above the average price.

5. Conclusion on likelihood of continuation of

dumping

(33)

(29)

Since dumping was found to exist during the IP, there is
no reason to believe that dumping will not continue
should the anti-dumping measures currently applicable
be repealed.

The export licence system has been substantially modi-
fied several
including a
times since its introduction,
temporary suppression of the quota system in 1998.
Therefore, should prevailing conditions in international
markets vary, or the scheme be perceived as not fulfil-
ling its objectives,
the Chinese administration might
decide to amend the system or to remove it altogether
lead to
without prior notice. This
decreasing export prices,
the anti-
dumping measures currently in force were repealed.

in turn might

in particular

if

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(34)

that

the fact

in view of

the system
In any event,
described above is run autonomously by the authorities
of the exporting country, it should not have any influ-
ence on the decision of
the Community institutions
whether or not to renew anti-dumping measures in the
framework of an investigation carried out pursuant to
Article 11(2) and 11(3) of the basic Regulation.

4. Chinese production, production capacity and

stocks

in the absence of

(35) No cooperation was obtained from any Chinese
producer of fluorspar. The Chinese authorities and the
CCCMC were informed that,
full
cooperation, the responses provided by various Chinese
parties concerned by the review would be considered to
be deficient. No information was submitted within the
time limit specified. The Commission had consequently,
in accordance with Article 18 of the basic Regulation, to
base its findings in respect of production, production
capacity and stocks of Chinese fluorspar on the basis of
the facts available. The information used stems from
market research in the sector, information provided by a
leading world trader of the product concerned as well as
from public information available from other anti-
dumping authorities.

(36)

respect an increase in Chinese production
In this
capacity of fluorspar and a build up of stocks have been
found during the investigation which poses the risk of
an increase of Chinese exports that could trigger a
world-wide price depression. Indeed, Chinese production
capacity of acid grade fluorspar has increased by 26 %
between 1993 and 1998. The capacity increase has also
led to a reduced utilisation of capacity that was esti-
mated to be 59 % in 1998 for acid grade fluorspar.
Large amounts of Chinese stocks were found to have
been built up. This creates a situation that is particularly
volatile given that Chinese production of acid-grade
fluorspar represents around 52 % of world production
and Chinese exports correspond to 38 % of world
output.

5. Conclusion on recurrence of dumping

(37)

Taking into account that:

— exports of fluorspar to the Community originating in
the PRC were found to be made at dumped prices
during the IP,

— given the possible temporary nature of the export
licence system, this system cannot be considered as a
guarantee that current export prices will be main-
tained,

— Chinese producers of

fluorspar have dramatically
increased their production capacity, have built up
enormous stocks and currently have a very low utili-
sation of capacity,

it is concluded that there is a likelihood that dumping
will continue at largely increased quantities, should the
measures in force be removed.

E. COMMUNITY INDUSTRY

(38)

shown that

The investigation has
the cooperating
Community producers represent more than 95 % of the
total Community production of the product concerned
during the IP. Therefore, these producers constitute the
Community industry within the meaning of Article 4(1)
and 5(4) of the basic Regulation. Hereinafter they will be
referred to as the Community industry.

F. ANALYSIS OF THE SITUATION IN THE COMMUNITY

FLUORSPAR MARKET

1. Consumption in the Community Market

(39) Apparent consumption was based on the combined
volume of sales to unrelated parties into the Community
market by the Community industry, the information on
the volume of total imports from the PRC reported in
the exporters/traders' questionnaires, imports from other
third countries as reported by Eurostat as well as data
from the national statistical offices of Austria, Finland
and Sweden for the import data prior to 1995.

(40)

Sales of Community producers to related parties which
transform fluorspar internally have been considered to
take place in a captive market and were therefore
excluded from the assessment of
the Community
consumption and, more generally, the situation of the
Community industry. This conclusion was reached in
view of the fact that the fluorspar intended for the
captive market was not in competition with the fluor-
spar available in the Community and that the sales of
that product to related parties were made at transfer
prices.

— the evolution of Chinese cif export prices largely
depends on the existence of the anti-dumping meas-
ures under review and on an export licence system
introduced and run autonomously by the PRC
government,

(41)

The applicant claimed that some imports originating in
Namibia and South Africa should be excluded from the
calculation of consumption since these imports were
made to users in the Community related to the exporters
concerned and thus were made on a captive market.

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(42)

It was found that both countries exported the product
concerned to both related and unrelated companies.
Furthermore,
the related parties in the Community
purchased the product concerned also from unrelated
sources. Given that no clear separation could be estab-
lished between these two types of sales, it was therefore
concluded that all
imports should be included in the
calculation of the Community consumption.

(43) On this basis,

the consumption in the Community
market evolved from around 284 300 tonnes in 1993,
to 392 700 tonnes in 1994,
to 400 900 tonnes in
1995, to 470 700 tonnes in 1996, to 491 800 tonnes
in 1997 and to 496 200 tonnes in 1998. Consumption
of fluorspar in the Community has increased by 75 %
over the period considered, especially between 1993 and
1994 (+ 38 %) and between 1995 and 1996 (+ 17 %).
This increase in consumption is linked to the develop-
ments of the demand for aluminium and the increasing
demand for fluorocarbons (refrigerants) as well as their
specific fluorspar requirements. This increase is also
attributable to the development of new downstream
applications for fluorspar.

2. Imports from the country concerned

(44)

(45)

(46)

(a) Import volume, share of the imports and market share of

the imports concerned

to 109 300 tonnes in 1996,

The volume of imports of fluorspar originating in the
PRC increased significantly from around 60 400 tonnes
in 1993, to 62 900 tonnes in 1994, to 68 500 tonnes
in 1995,
to 128 800
tonnes in 1997 and to 155 200 tonnes in 1998.
Chinese imports of fluorspar into the Community have
continuously increased during the period considered by
about 157 %, growing at a higher pace than the
Community consumption.

The share of imports from the PRC of the total imports
of fluorspar into the Community has fluctuated between
26,7 % and 50,6 %. The highest
import share was
reached in the IP.

The share of the Community market held by the imports
from the PRC developed from 21,3 % in 1993, to 16 %
in 1994, to 17,1 in 1995, to 23,2 % in 1996, to 26,2 %
in 1997 and to 31,3 % in 1998. This is equivalent to an
overall increase of 10 points over the period examined.
The decrease in market share in 1994 and 1995 can be
explained by both the introduction of the anti-dumping
measures in March 1994 and the Chinese export licence
system introduced in April 1994.

increased by 29 % between 1993 and the IP to reach a
level on a cif Community frontier basis slightly below
the minimum price of 113,5 euro/tonne. In particular,
between 1993 and 1997, prices of Chinese fluorspar
have continuously increased from 86,06 ECU/tonne to
114,58 ECU/tonne. The decrease in Chinese prices
between 1997 and 1998 coincided with the elimination
of the Chinese export quota which triggered a general
decrease in Chinese export prices to all export markets.

(ii) P r i c e b e h a v i o u r

(48)

In order to examine the price behaviour of Chinese
imports during the IP, a price comparison was made on
the basis of the average sales prices of the Community
industry and the average sales price of the cooperating
Chinese exporters/traders and non-EC traders to unre-
lated importers in the Community adjusted to the same
level of trade.

(49)

Chinese prices during this time period were lower by a
margin of around 12 % than those of the Community
industry.
the undercutting
margin in the previous investigation amounted to 41 %.

It should be noted that

3. Economic situation of the Community industry

(a) Production

(50)

The production of the Community industry increased by
32 % over the period examined going from around
276 000 tonnes in 1993 to around 363 800 tonnes in
1998. A peak of around 372 300 tonnes was reached in
1995.

(b) Production capacity

(51)

The production capacity of the Community industry was
calculated on the basis of the flotation capacity, which
represents the bottleneck of the fluorspar production. It
went from 518 000 tonnes in 1993 to 502 000 in
1998, representing a decrease of 3 % during the period
examined.

(b) Price

evolution and price behaviour of

the

imports

(52)

concerned

(i) P r i c e e v o l u t i o n

(47) According to the exporters/traders' questionnaire replies
it was found that the prices of Chinese fluorspar, have

(c) Capacity utilisation

The capacity utilisation of
the Community industry
increased from 53 % in 1993 to 60 % in 1994, to 72 %
in 1995, to 68 % in 1996 and 1997, and to 72 % in
1998. The low levels of 1993 and 1994 can be
explained by the effects of the dumped imports as estab-
lished in the previous investigation. It is only after 1994
that the anti-dumping measures started to have an effect
allowing the Community industry to operate at higher
capacity utilisation levels.

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(d) Sales volume

(j) In vestments

(53)

(54)

(55)

The sales of the Community industry in the Community
increased from around 120 000 tonnes in 1993 to
around 189 000 tonnes in 1998. The increase in sales
was
in 1995, when the
Community industry increased its sales to 191 600
tonnes by decreasing its prices. This was done in order
to maintain its share of the Community market.

in particular noticeable

(e) Market share

the Community
The Community industry's share of
market decreased from 42,1 % in 1993 to 38,1 % in
1998, with a peak in 1995. The market share of 47,8 %
attained in 1995 corresponds to a general decrease in
imports into the Community that year which was the
result of low prices charged by the Community industry
to the detriment of
its profitability. After 1995, the
market
share decreased regularly, dropping by 4
percentage points compared to 1993.

(f) Price development

for

industry

sales of

fluorspar of

average price

the
The
Community
in the Community market
decreased between 1993 and 1995 and increased
globally between 1995 and 1998 with a peak in 1997.
The low price level in 1995 corresponds to the strategy
of the Community industry outlined above of trying to
maintain market share by decreasing its price level.
Between 1995 and 1997,
the
Community industry increased, coinciding with the
steady increase of both Chinese prices and demand of
fluorspar. Between 1997 and 1998, prices of
the
Community industry slightly decreased, coinciding with
a decrease in the Chinese import prices.

the price level of

(59)

The total investments of the Community industry related
to fluorspar increased from around 2,2 Mio ECU in
1993 to 9,4 Mio ECU in 1998.

(k) Conclusion

the

situation of

the Community

(60) After the imposition of the anti-dumping measures in
industry
1994,
improved overall. Continued efforts to rationalise the
production process and new investments were made.
However, although the situation has improved globally,
the period in which the measures were in force has not
allowed the Community industry to fully recover from
the past effects of the dumped imports, especially as far
as profitability is concerned. Indeed, the profitability of
the Community industry remained negative between
1993 and 1997. As from 1997 the profitability of the
Community industry improved, coinciding with an
in the
overall
in its
Community and in its productivity. However,
the
Community industry is only just above break-even and
its financial results remain clearly below what this type
of industry could achieve under normal market condi-
tions.

improvement

sales prices

(61)

It is therefore concluded that although the situation of
the Community industry has improved subsequent to
the imposition of anti-dumping measures,
it has not
fully recovered and continues to be in a precarious
situation.

4. Impact of the imports concerned

(g) Profitability

(62)

(56)

The profitability of the Community industry, expressed
in percentage of the net sales went from –11,8 % in
1993 to 0,9 % in 1998.

(h) Employment

(57)

Employment of the Community industry went from 696
employees in 1993 to 689 employees in 1998.

(i) Stocks

(58)

The stocks of
the Community producers decreased
steadily from around 50 000 tonnes in 1993 to 28 400
tonnes in 1998 which is equivalent to a decrease of
43 %. Stocks represented 18 % of production in 1993
and 8 % in 1998.

Indeed,

imports of

The investigation has shown that, despite the imposition
of the anti-dumping measures in March 1994, Chinese
exports to the Community market have continued to
fluorspar from the PRC
increase.
increased by 157 % between 1993 and 1998 and their
share of the Community market increased from 21,3 %
to 31,3 %. Over
the
Community industry increased by 58 % but they lost
market share to the benefit of Chinese imports. Their
share of the Community market decreased from 42,1 %
to 38,1 %.

same period,

sales of

the

(63) As

regards prices, prices of

the Chinese imports
increased by 29 % over the period considered. This
development in prices has to be seen in the light of the
introduction of the anti-dumping measures in March
1994 and the Chinese export licence system introduced
in 1994 which has contributed to the increase of the
Chinese prices world-wide. The increase in prices is
more significant as from 1996, coinciding with an
improvement in the sales prices and a reduction of the
losses of the Community industry.

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Official Journal of the European Communities

26.9.2000

(64)

(65)

the Ministry for Foreign Trade and
In July 1998,
Economic Cooperation (MOFTEC) eliminated the export
quota maintaining only the licence fee. Coinciding with
this, Chinese prices decreased, notably in the second half
for a
of 1998 and in 1999, showing the potential
in the
decrease in the prices of Chinese fluorspar
absence of anti-dumping measures.

5. Import volumes and import prices of other third

countries

The volume of fluorspar imports from other third coun-
tries increased by 46 % over the period examined from
some 104 100 tonnes in 1993 to 151 700 tonnes in
1998. However,
the above-
mentioned countries decreased globally between 1993
and 1998 from 36,6 % to 30,6 %.

the market

share of

(66) As regards the prices of these other exporting countries,
it is noted that they increased by 20 % between 1993
and 1998. However, they remained on average lower
than the Chinese prices with the exception of Morocco.
In the case of Namibia and South Africa, the fact that
average export prices are lower than the Chinese prices
should be seen in the light of the fact that part of the
exports
to related
likely at transfer prices. As regards
Community users,
their fluorspar prices appear to
Kenya and Mexico,
reflect
impurities, which
command lower prices as they entail additional costs for
the users.

to the Community are made

a higher percentage of

(67) On the basis of the above, it is considered that imports
fluorspar from other third countries have had a
of
limited impact on the economic situation of
the
Community industry. Furthermore, it indicates that the
Chinese exporters were able to significantly improve
their position in the Community to the detriment not
only of the Community industry, but also of other third
countries.

G. LIKELIHOOD OF CONTINUATION OF INJURY

(68)

In order to assess the likely effect of the expiry of the
measures in force, the following factors were examined:
the situation of the fluorspar industry in the PRC, the
behaviour of Chinese imports of fluorspar in other third
countries and the likely consequences of the removal of
the
the anti-dumping measures on the situation of
Community industry.

1. Analysis of the situation of the fluorspar industry

in the PRC

(a) Production, production capacity, stocks

(69)

The applicant argued that production and production
capacity of
fluorspar in the PRC have substantially
increased in the period considered, reaching levels well
above annual world consumption. It was further argued

that if measures are removed, there is a threat of a
further increase of dumped Chinese imports.

(70)

The Chinese exporters/traders claimed that it was very
unlikely that exports of fluorspar to the Community
would increase if measures were repealed given the
increase in domestic consumption and the controls
imposed by the Chinese authorities to production and
production capacity.

(71) A number of Community users claimed that the current
level of production and production capacity in the PRC
to the
during the IP did not constitute a threat
Community industry given that internal consumption
was growing, third countries which did not traditionally
purchase from the PRC, such as India, were starting to
import Chinese fluorspar and it was expected that
focus on the United States of
Chinese exports will
America (hereinafter referred to as the US) market, given
the expected increased demand in that market.

(72) According

and

to the

information available

as
mentioned in recital 36, it should be noted that Chinese
production and Chinese production capacity have
steadily increased over the period examined. Indeed, the
Chinese production capacity has increased from 1,9
million tonnes in 1993 to 2,4 million tonnes in 1998.
The production has increased from 0,8 million tonnes to
1,4 million tonnes over the same years. At the same
time, utilisation of capacity has been low, estimated at
59 % in 1998. Chinese domestic consumption is esti-
mated to be at around 300 000 tonnes per year.
Furthermore, during that same period, large amount of
Chinese stocks have been built up.

(73) With such a huge production capacity and the possible
dropping of the Chinese licence system, there is a likeli-
hood that large quantities, above the current imports
volume, of dumped Chinese fluorspar, could revert to
the Community market in the absence of anti-dumping
measures.

(b) The Chinese export licence system

(74) As already mentioned in recital 32, in April 1994, the
Chinese authorities introduced an export licence system
consisting of an annual export quota combined with an
export licence fee on Chinese exports of fluorspar.

(75)

The system has undergone some changes over recent
years: the export quota was lifted mid 1998, thus from
the second half of 1998 only the export licence fee
the
remained in force. At
Chinese authorities reintroduced the quota. In 1998, the
licence fee was about ECU 20,3 per tonne on average.
This implies that
if exports are made at a level of
ECU 113,5, the actual export price without licence fee
would be ECU 93,2.

the beginning of 1999,

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The applicant claimed that the Chinese licence system
could be abolished soon, raising fears that Chinese
exports of fluorspar to the Community would increase
at lower prices, should the anti-dumping measures be
allowed to expire.

(82)

The Chinese exporters/traders argued that the licence
system was intended to protect the resources of fluor-
spar and ensure stability and reliability in the fluorspar
market and that there was no reason to assume that the
system would be abolished soon. They further stated
that,
anti-dumping measures not be
continued, the licence system would not be lifted.

should the

in force,

the prices of

Secondly, the investigation has shown that even with the
anti-dumping measures
the
Community industry were under pressure from the
imports concerned. It is expected that in the absence of
measures, prices, which the investigation has shown
have been positively affected by the anti-dumping meas-
ures, would start to decrease and price undercutting
would continue at higher levels. The potential for the
decrease in Chinese prices is reflected in the amounts
paid for the export licence fee, which amounted to ECU
20,3 on average in 1998. When deducting this amount
from the export price, the undercutting margin could be
estimated at 26,7 %. It is expected that such a price
undercutting would result
to the
Community industry.

in severe losses

(76)

(77)

(78)

It was considered that any presumption on the future
development of the licence system is rather speculative.
the Chinese licence system
However, an analysis of
shows that it has been substantially modified several
times since its introduction, including a suppression of
the export quota in 1998. Furthermore, the considerable
amount of the Chinese licence fee shows the potential of
Chinese fluorspar producers to sell at very low prices. In
addition,
licence system
conceived and administered by a third country govern-
ment
the
resources cannot be relied on to conclude whether or
not injurious dumping would continue.

the existence of an export

the preservation of

the purpose of

for

(c) Evolution of Chinese export prices to the Community

(79)

The anti-dumping measures appear to have led to a
progressive increase in the export prices practised by the
Chinese exporters. Therefore, the removal of measures
could reverse the situation and bring along a decrease of
export prices as shown by the experience during 1998
the Chinese export
and the considerable amount of
licence fee.

(80)

Furthermore, a number of instances were found in 1998
where users purchased Chinese fluorspar below the
minimum price and had therefore to pay anti-dumping
duties.

2. Likely consequences of the removal of the anti-
the
dumping measures on the situation of
Community industry

(81)

In the first place, it is noted that after the IP, one of the
applicant Community producers ceased its fluorspar
production when it lost its biggest customer to Chinese
competition. The fact that this took place at a time when
anti-dumping measures were in force, shows the poten-
tial of further injury to the Community industry should
anti-dumping measures be eliminated.

(83)

it

is expected that

Thirdly,
in the absence of anti-
dumping measures large volumes of low priced dumped
imports of fluorspar will be present on the Community
market. Community producers will
then likely lose
further sales volume and market share to the Chinese
exporters.

3. Conclusion on the likelihood of continuation of

injury

(84)

Taking into account that:

— Chinese producers of

fluorspar had dramatically
increased their production capacity, had built up
large stocks and had a very low capacity utilisation
level,

— the evolution of Chinese cif export prices has been
considerably influenced by the anti-dumping meas-
ures in force and the existence of an export licence
system imposed by the PRC government. This
system cannot be considered as a guarantee that
export prices will be maintained, in the absence of
anti-dumping measures,

— the prices that the Chinese exporters would charge in
the absence of anti-dumping measures are potentially
very low in particular if account is taken of the
amount of the export licence fee paid, which indi-
cates a strong likelihood of continuation of under-
cutting,

— the situation of
precarious,

the Community industry is still

— the fact that a number of instances have been found
where the users in the Community have purchased
Chinese fluorspar below the minimum import price,

is concluded that

it
the injury caused by Chinese
dumped imports is likely to continue should the meas-
ures in force be removed and the situation of
the
Community industry could even further deteriorate in
such an event.

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H. COMMUNITY INTEREST

(85) According to Article 21 of the basic Regulation, it was
examined whether it could be clearly concluded that
maintaining the anti-dumping measures would not be in
the
the Community interest. The determination of
Community interest was based on an appreciation of all
the various interests involved taken as a whole, i.e. those
of the Community industry, the importers as well as the
users of the product concerned.

(86)

(87)

(88)

It should be recalled that, in the previous investigation,
the adoption of anti-dumping measures consisting of a
minimum price was considered not to be against the
interest of the Community. It should be noted that the
present
investigation is a review, which requires an
analysis of a situation in which anti-dumping measures
are already in place. Consequently, the timing and nature
of the present investigation allows an assessment of any
negative undue impact by the anti-dumping measures
under review.

the measures,

In order to assess the likely impact of a continuation or
the Commission
non continuation of
requested information in the form of questionnaires
from all interested parties mentioned above. No impor-
ters replied to the questionnaire. Nine users replied to
the questionnaires.

1. Interest of the Community industry

shown that

The investigation has
the Community
industry has benefited from the anti-dumping measures
in place. In recent years, it has made considerable efforts
to improve its productivity through rationalisation.
Indeed, the productivity of the Community industry has
increased by 33 % during the period examined and
investments have been made constantly throughout that
same period. The level of investments has been espe-
cially high in 1998, showing that this industry is viable
and determined to remain in operation.

(89) However, the situation of the Community industry still
remains difficult, notably in terms of profitability. In this
context, any change in the commercial environment of
the product concerned may have a significant adverse
effect on the situation of
the Community fluorspar
industry.

(90)

In view of the above, it was considered that without the
continuation of
the
Community industry is likely to deteriorate. The contin-
uation of
therefore, be in the
interest of the Community industry.

the measures would,

the situation of

the measures,

PRC have continuously increased during the period
examined and thus importers have been able to continue
sourcing from the PRC.

(92)

In view of the above, it is therefore concluded that a
continuation of the measures would not lead to a deteri-
oration of their economic situation in the future.

3. Interest of the user industry

(a) Preliminary remarks

(93)

(94)

(95)

Fluorspar is a basic raw material for a large number of
downstream products with very high value added. The
first transformation step of fluorspar is the production
of hydrofluoric acid (hereinafter referred to as ‘HF’)
which is in turn used for the production of fluorocar-
bons
foamings),
aluminium fluoride (for aluminium production) and
other chemical derivatives.

refrigerants,

solvents,

(input

for

(b) Data gathered from cooperating parties

In 1998, the cooperating users purchased the totality of
the imports of fluorspar from the PRC and around 80 %
fluorspar made by the Community
of
industry.

the sales of

In 1998,
these cooperating companies represented a
turnover of 26 465 Mio ECU out of which 682 Mio
ECU (2,6 %) related to fluorspar derivative applications.
The fluorspar user
industry is composed of small,
medium size and large companies which made signifi-
cant investments in 1998. The weighted average profit-
ability of the fluorspar derivatives sector has increased
from 3,7 % in 1996 to 6,3 % in 1998.

(96)

The investigation has shown that fluorspar represents
around 30 % of the total costs of production of HF and
between 5 % to 20 % for HF derivatives.

(c) Arguments raised by the users

(i) D e p e n d e n c e o n i m p o r t s

2. Interest of the importers

(91) None of the unrelated importers replied to the question-
naires. The lack of cooperation could be an indication
that the anti-dumping measures imposed in March 1994
have not had a significant adverse effect on importers.
This can be supported by the fact that imports from the

(97)

Some users claimed that the maintenance of the meas-
ures is not in the interest of the Community given that
the users are dependent on imports in view of
the
limited production capacity available in the Community.
In this respect they argued that the continuation of the
anti-dumping measures could create a shortage of
supply in the Community whereas the demand for fluor-
spar is rising due to a combination of technological and
regulatory developments.

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L 241/15

(98)

(99)

The Community industry did not dispute that imports
from third countries
the
Community demand for fluorspar. It claimed that the
aim of anti-dumping measures is not to keep imports
out of the Community but to ensure that these imports
are made at fair prices.

are necessary to meet

the anti-dumping
The investigation has shown that
measures in force have not prevented the Chinese
imports from entering the Community market. Indeed,
between 1994 and 1998 imports
from the PRC
increased by 146 %, following an increase in demand for
fluorspar. At the same time, the Community industry
also increased its sales by 58 %.

(100)

In view of the above, the maintenance of the measures is
not likely to prevent users from sourcing from the PRC,
whereas the maintenance of a safety net will assist the
Community industry in fully recovering from the injury
suffered. From the above it is also unlikely that shortages
of supply could occur should anti-dumping measures be
maintained.

to 6,3 % in 1998 notwithstanding the anti-dumping
measures in force.

(104) As regards, more specifically, the relocation of the HF
production in the PRC, it should be noted that HF is a
highly dangerous product that is not suitable for travel-
ling over long distances. This means in practice that the
relocation of the HF production in the PRC would entail
the relocation of the entire downstream industry in the
PRC. Information provided by cooperating users relating
to the period when anti-dumping measures were applic-
able seems to contradict the above. Indeed, users have
investments in the Community in
made significant
downstream production during the period of application
of anti-dumping measures. In view of the above, the
relocation of the entire downstream industry in the PRC,
should anti-dumping measures be allowed to continue,
does not appear likely.

(105)

In view of the above, the maintenance of anti-dumping
measures in their current form is not expected to cause
any competitive disadvantages for the user industry.

(ii) C o m p e t i t i o n d i s a d v a n t a g e s

(iii) A l t e r n a t i v e s o u r c e s o f s u p p l y

(101) Some users claimed that

the anti-dumping measures
lead to artificially
imposed on Chinese fluorspar will
high fluorspar prices in the Community and will result
in the fluorspar users being placed at a competitive
disadvantage as regards their Community competitors
not sourcing from the PRC and also as regards their
competitors internationally. This would result in a relo-
cation of HF production to the US and the PRC where
access to fluorspar would be cheaper with consequent
loss of jobs, investments and profits in the Community
in high value added industries which are vital for the
future competitiveness of the Community fluorspar user
industry.

(102) The Community industry has argued that during the
period of application of the measures, the downstream
industry has made
in the
significant
Community, contradicting the argument of relocation.

investments

(103)

It was found that between 1996 and 1998, significant
investments were made by the fluorspar user industry in
the Community. Furthermore, prices of fluorspar in the
US have been found to be higher
than in the
Community.
Indeed during 1998, prices of Chinese
imports into the US were 7 % higher than those of the
Chinese imports in the Community market. Profits of
the users have increased on average from 3,7 % in 1996

(106) A number of large fluorspar derivatives producers have
to rely on imports of fluorspar. It was claimed by the
users that there are significant impurities in non-Chinese
fluorspar, i.e. in Kenyan and Mexican fluorspar, which
explains why the main reliable source of supply is the
PRC. Therefore, the continuation of the anti-dumping
measures on imports from the PRC would hamper the
access of users to good quality fluorspar.

(107) Firstly, it should be noted that, despite the differences in
imports from other countries have increased
purity,
during the period of application of anti-dumping meas-
ures, following an increase in demand. For example,
imports from Mexico have been multiplied by six while
imports from Kenya have increased by 57 %. The above
appears to indicate that such fluorspar is suitable for
certain downstream applications.

(108) Secondly, the substantial increase of imports from the
PRC indicates that the measures imposed in 1993 have
not had the effect of excluding Chinese imports from the
Community market but have resulted in an increase in
prices.

(109)

It is therefore concluded that the continuation of the
current anti-dumping measures is not likely to result in a
reduced access to fluorspar of all qualities for users.

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4. Conclusion on Community interest

(116)

It is therefore concluded that the anti-dumping measures
should be maintained in their current form.

(110) Having analysed the various interests involved it has
been found that the continuation of the anti-dumping
measures is likely to result in a relatively stable price for
fluorspar in the Community market, which during the
period of application of the measures in force appeared
not to have any negative effects on the economic situa-
tion of the users. Furthermore, leaving the Community
industry without protection against the dumped imports
could aggravate its precarious situation and endanger its
viability.

(111)

In view of the above, it is concluded that there are no
compelling reasons on grounds of Community interest
against the maintenance of the anti-dumping measures
in the present case.

I. INTERIM REVIEW

illegal

(112) The Chinese exporters/traders argued that the initiation
of the interim review, limited in scope to the form of the
measures, was
since no evidence had been
presented which would suggest the need to change the
form of the measure. In this respect they argued that the
request for a review according to Article 11(2) of the
basic Regulation did not contain any information on the
ineffectiveness of the anti-dumping measures in place.

(113)

It should be mentioned that the interim review limited
to the form of the measures was initiated ex officio by
the Commission. The initiation was based on the
grounds that information contained in the request for a
review according to Article 11(2) of the basic Regulation
presented by the applicant contained indications of the
undermining of
the measures
concerned.

the effectiveness of

(114) The

shown that,

investigation has

although the
Community industry lost market share during the period
examined, the anti-dumping measure in its current form
has allowed the Community industry to increase its
in particular
prices and therefore to reduce its losses,
during the time period between 1996 and 1998.
However, the duration of the measure has not allowed
the Community industry to fully recover, namely in
terms of profitability. Therefore, as far as the effective-
form
ness of
appears to be appropriate to fully restore the situation of
the Community industry and should consequently not
be modified.

the measure is concerned,

its current

(115) Finally, as far as users are concerned, the investigation
the anti-dumping measures in their
affected the

has shown that
current
economic situation of users.

form have not

significantly

J. ANTI-DUMPING MEASURES

(117) All parties concerned were informed of the essential
facts and considerations on the basis of which it was
intended to recommend that the existing measures be
maintained. They were granted a period within which to
make representations subsequent to disclosure. Repre-
sentations made after final disclosure were duly taken
into consideration.

(118)

It follows from the above that, as provided for by Article
11(2) of the basic Regulation, the anti-dumping duty
calculated on the basis of
the minimum price of
ECU 113,50 per dry metric tonne on imports of fluor-
spar originating in the People's Republic of China
imposed by Regulation (EC) No 486/94 should be main-
tained,

HAS ADOPTED THIS REGULATION:

Article 1

1.
A definitive anti-dumping duty is hereby imposed on
imports of fluorspar presented in filter cake or powder form,
falling within CN code
ex 2529 21 00 (TARIC code
2529 21 00 10) or CN code ex 2529 22 00 (TARIC code
2529 22 00 10), originating in the People' s Republic of China.

The duty shall be equal

to the difference between a
2.
minimum price of EUR 113,50 per tonne (dry net weight) and
the net, free-at-Community-frontier price, before customs clear-
ance.

3.
In cases where goods have been damaged before entry
into free circulation and, therefore, the price actually paid or
payable is apportioned for the determination of the customs
value pursuant to Article 145 of Commission Regulation (EEC)
No 2454/93 (1), the minimum import price set out above shall
be reduced by a percentage which corresponds to the appor-
tioning of the price actually paid or payable. The duty payable
to the difference between the reduced
will
then be equal
minimum import price
free-at-
reduced net,
Community frontier price, before customs clearance.

and the

4.
Unless otherwise specified,
concerning customs duties shall apply.

the provisions

in force

Article 2

This Regulation shall enter into force on the day following that
of its publication in the Official Journal of the European Communi-
ties.

(1) OJ L 253 11.10.1993, p. 1. Regulation as last amended by Regula-

tion (EC) No 1662/1999 (OJ L 197, 20.7.1999, p. 25).

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

Done at Brussels, 18 September 2000.

For the Council

The President

H. VÉDRINE