Council Regulation (EC) No 901/2001 of 7 May 2001 imposing a definitive anti-dumping duty on imports of urea originating in Russia
Date: 2001-05-07
Institutions: Council of the European Union
Subjects: Poland, anti-dumping duty, anti-dumping legislation, import, organic fertiliser, originating product

9.5.2001

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Official Journal of the European Communities

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COUNCIL REGULATION (EC) No 901/2001

of 7 May 2001

imposing a definitive anti-dumping duty on imports of urea originating in Russia

THE COUNCIL OF THE EUROPEAN UNION,

3. Present investigation

Having regard to the Treaty establishing the European
Community,

3.1. Request for review

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

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

Whereas:

A. PROCEDURE

1. Previous investigations

(1)

In 1987, the Commission imposed a provisional anti-
dumping duty (2) on imports of urea originating,
amongst others, in the former Soviet Union. By Regula-
tion (EEC) No 3339/87 (3), the Council accepted under-
takings in respect of imports of urea from, amongst
the former Soviet Union. By Commission
others,
Decision 89/143/EEC (4),
undertakings were
these
confirmed. In March 1993 the Commission initiated a
review of
for
imports of urea originating in,
inter alia, the former
Soviet Union (5). This resulted in the imposition of a
definitive anti-dumping duty by Council Regulation (EC)
No 477/95 (6) on urea, originating in the Russian
Federation (‘Russia’). The amount of the duty imposed
was the difference between ECU 115 per tonne and the
net, free-at-Community frontier price, before customs
clearance,

the decision accepting undertakings

if this price was lower.

(3)

(4)

(5)

2. Investigations concerning other countries

(6)

(2)

In October 2000 an anti-dumping investigation was
initiated concerning imports of urea originating in
Belarus, Bulgaria, Croatia, Egypt, Estonia, Lithuania,
Libya, Poland, Romania and Ukraine (7). The invest-
igation is currently underway.

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

(EC) No 2238/2000, (OJ L 257, 11.10.2000, p. 2).

(2) OJ L 121, 9.5.1987, p. 11.
(3) OJ L 317, 7.11.1987, p. 1.
(4) OJ L 52, 24.2.1989, p. 37.
(5) OJ C 87, 27.3.1993, p. 7.
(6) OJ L 49, 4.3.1995, p. 1.
(7) OJ C 301, 21.10.2000, p. 2.

In September 1999, the Commission published a notice
of impending expiry (8) of the anti-dumping measures in
force on imports of urea originating in Russia. The
Commission subsequently received a request to review
these measures pursuant to Article 11(2) of Regulation
(EC) No 384/96 (9) (the ‘basic Regulation’). The request
was lodged on 3 December 1999 by the European Ferti-
lizer Manufacturers Association (EFMA) on behalf of
producers
of
Community production of urea (the ‘product concer-
ned’). The request was based on the grounds that the
expiry of the measures would be likely to result in the
continuation or recurrence of dumping and injury to the
Community industry.

representing

proportion

a major

3.2. Notice of initiation

Having determined, after consultation of the Advisory
Committee, that sufficient evidence existed for the initia-
tion of a review, the Commission initiated an invest-
igation pursuant to Article 11(2) of the basic Regulation
in March 2000 (9).

3.3. Period of investigation

The investigation period for the examination of contin-
uation or recurrence of dumping and injury covered the
period from 1 January 1999 to 31 December 1999 (the
‘IP’). The examination of trends relevant for the assess-
ment of continuation or recurrence of injury (the ‘period
under review’) covered the period from 1 January 1996
up to the end of the IP.

3.4. Parties concerned by the investigation

the

advised

the exporting producers

applicant
The Commission officially
Community producers,
in
Russia, the importers, users and associations known to
be concerned, and the representatives of the exporting
country concerned of the initiation of the review. The
Commission sent questionnaires to exporting producers,
Community producers, importers, users and associations
known to be concerned and to those who made them-
selves known within the time limit set in the notice of
initiation. In addition, the sole producer in the Slovak
Republic, which was considered as a suitable analogue
country, was advised and sent a questionnaire.

(8) OJ C 252, 3.9.1999, p. 2.
(9) OJ C 62, 4.3.2000, p. 19.

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(7)

(8)

Eleven Community producers, one analogue country
producer, one importer, one users' association and one
user replied to the questionnaires. With respect to the
exporting country concerned, no replies to the question-
naires were received.

3.5. Verification of information received

(13)

The Commission sought and verified all information it
deemed necessary for the purpose of a determination of
the continuation or recurrence of dumping and injury
and of the Community interest. The Commission also
gave the parties directly concerned the opportunity to
make their views known in writing and to request a
hearing.

(9)

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

be excluded that such imports will be carried out in the
future.

2. Like product

The investigation has shown that the product produced
and sold by the Community producers on the
Community market is alike in all respects to the urea
produced in Russia and exported to the Community. It
is therefore considered to be a like product within the
meaning of Article 1(4) of the basic Regulation. It was
also found that urea exported from Russia to the
Community and urea produced and sold on the
domestic market of Slovakia, which served as an
analogue country, were alike.

Community producers:

Hydro Agri Brunsbüttel, Germany

Hydro Agri Italia SpA, Italy

Irish Fertilizer Industries Ltd., Ireland

Analogue country producer:

Duslo, as, Šal'a, Slovakia

Unrelated importer:

Cargill BV, Amsterdam, Netherlands

Users/Users' association:

Sadepan Chimica SRL, Viadana, Italy

Svenska Lantmännen, Stockholm, Sweden.

B. PRODUCT CONCERNED AND LIKE PRODUCT

1. Product concerned

The product concerned by this proceeding is the same as
i.e. urea. It is produced
in the previous investigation,
mainly from ammonia which is itself produced from
natural gas. It may take a liquid or a solid form. Solid
urea can be used for agricultural and industrial purposes.
Agricultural grade urea can be used either as a fertiliser,
which is spread onto the soil, or as an animal feed
additive.
for
certain glues and plastics. Liquid urea can be used both
as a fertiliser and for industrial purposes. All kinds of
urea have the same basic physical and chemical charac-
teristics and may be regarded for the purposes of the
present review as a single product.

Industrial grade urea is a raw material

product

concerned

The
falls within CN codes
3102 10 10 and 3102 10 90. One importers' associa-
tion claimed that urea imported under CN code
3102 10 90 should be excluded from the present
review, as there have been no such imports for a
number of years.

In relation to this claim, it is to be noted that, even if
there were no imports for a number of years under CN
code 3102 10 90, the product classifiable under this CN
code clearly belongs to the single category of product
forming the ‘product concerned’ and moreover it cannot

(10)

(11)

(12)

C. RECURRENCE OR CONTINUATION OF DUMPING

(14)

In accordance with Article 11(2) of the basic Regulation,
it was examined whether or not the expiry of measures
would lead to a continuation and/or recurrence of
dumping.

(15) During the IP, 25 Ktonnes of urea were imported from
Russia (as compared to 117 Ktonnes imported during
the previous IP (1992) and 271 Ktonnes in 1986). This
represents a market share of 0,4 %.

1. Likelihood of a continuation of dumping

1.1. Analogue country

(16) Normal value was based, in accordance with Article 2(7)
of the basic Regulation, on information obtained in a
market economy third country where the product
concerned was produced and sold.
In the Notice of
Initiation the Commission suggested the Slovak Republic
as an appropriate analogue country due to the fact that
it was used as an analogue country in the last invest-
igation and that production processes and access to raw
materials in the Slovak Republic are comparable to those
prevailing in Russia.

for the production of urea,

(17) An importers' association objected to the choice of the
Slovak Republic as analogue country for the following
reasons:
the Slovak Republic, unlike Russia, has no
natural gas production. Since gas is the basic raw
is the main
material
element in the cost of the final product. Moreover, it
was
totally
dependent on Russian gas and pays a very high price for
it. It was therefore claimed that the use of the Slovak
Republic as analogue country would artificially inflate
normal value and thus result
in an artificially high
dumping margin.

the Slovak Republic

claimed that

is

it

(18)

the importers' association submitted that,
Secondly,
given the importance of gas in the production of urea,
any analogue country in this case should be a gas-
producing country. The importers' association proposed
Norway, Canada or Saudi Arabia as alternative analogue
countries.

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this was

the choice of

(19) With regard to the first allegation, it should be pointed
out that Russian gas prices are heavily discounted on the
Russian market and are not determined by market
forces. In addition, no evidence was provided that gas
prices in the Slovak market were higher than gas prices
in other market economies. Nor did the Commission
find any indication that
the case when
comparing gas prices in Slovakia during the IP to gas
prices in other market economies. It cannot therefore be
accepted that
the Slovak Republic as
analogue country serves to artificially inflate normal
value. With regard to the
the
Commission analysed whether any of
the countries
proposed were more appropriate. Norway would obvi-
ously not have been a suitable choice due to the fact that
it does not produce urea. Saudi Arabia was considered
inappropriate because this country's legislation allows
for artificially low raw material prices for the national
industry using natural gas and provides investment
incentives for its fertiliser industry. As regards Canada,
no cooperation could be obtained from the Canadian
urea industry.

second argument,

(20)

The choice of the Slovak Republic as analogue country
was therefore upheld on the following grounds: it was
used as an analogue country in the previous invest-
igation; production processes and access to raw mate-
rials in the Slovak Republic are comparable to those
prevailing in Russia; prices of natural gas in the Slovak
Republic were competitive and not higher than gas
prices in other market economies; a high level of
cooperation from that country could be obtained. The
sole Slovak producer agreed to cooperate in the invest-
igation and it was also established that domestic sales
made by the latter producer were representative in
comparison with the volume of
to the
Community from Russia.

exports

(21) On this basis, it was concluded that the Slovak Republic
was an appropriate and not unreasonable choice of
analogue country in order to establish normal value for
imports of urea originating in Russia.

1.2. Normal value

Community by the exporting producers in Russia during
the IP.

(23)

It was then established that these direct sales to unre-
lated customers could be considered as having been
trade, comparing
made in the ordinary course of
domestic prices and costs of production.

(24) Normal value was therefore established as the weighted
average of the actual prices of all direct sales to unre-
lated customers on the Slovak market.

1.3. Export price

(25) As no exporting producers cooperated, the export price
was determined on the basis of the facts available, in
accordance with Article 18(1) of the basic Regulation. In
this case this was by reference to the average import
price reported by Eurostat.

1.4. Comparison

(26) As urea is a bulk product with transport costs repre-
senting a large proportion of the selling price, it was
considered appropriate that the comparison should be
carried out on an ex-works basis. Due allowance in the
form of adjustments was made for differences affecting
price comparability, in accordance with Article 2(10) of
the basic Regulation. In particular, an adjustment to the
normal value was made for packing costs while the
export price was adjusted for transport costs incurred in
Russia and freight from Russia to the Community on the
basis of the information contained in the complaint and
other available information.

1.5. Dumping margin

(27)

In accordance with Article 2(11) of the basic Regulation,
the dumping margin was determined by comparing the
weighted average normal value in the analogue country
with the average export price per tonne based on Euro-
stat data.

(28)

The comparison showed the existence of significant
dumping (above 35 %). The level of dumping is thus
higher than in the previous investigation (28,2 %).

(22)

Firstly, it was examined whether the domestic sales made
by the cooperating Slovak producer were representative
when compared to the imports into the Community
concerned by the investigation. In this context and, it
was considered appropriate to exclude sales to related
parties, as not having been made in the ordinary course
of trade. After exclusion of the latter sales, it was estab-
lished that direct
sales by the cooperating Slovak
producer were sufficiently representative as they were
made in significant quantities, measured against
the
average volume of exports recorded as sold into the

1.6. Conclusion

(29) Nothing found during the investigation suggests that the
level of dumping found would disappear or even
decrease should the anti-dumping measures be repealed.
It was therefore concluded that, should the measures be
repealed, there is a likelihood that imports from Russia
will continue at dumped prices. However, in view of the
limited export volume during the IP, it was considered
appropriate also to examine whether there was a likeli-
hood of recurrence of dumping in increased export
volumes should the existing measures be repealed.

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2. Likelihood of recurrence of dumping

redirected to the Community should measures be
repealed.

2.1. Analysis of the situation of the country concerned

2.2. Conclusion

(30) As outlined above, imports into the Community were
found to be made at dumped prices. However,
the
import volumes during the IP were low (0,4 % of
further
Community consumption). Therefore it was
examined whether other circumstances might indicate
the likelihood of a recurrence of
further dumped
imports, should the measures be repealed.

(37)

2.1.1. P r o d u c t i o n c a p a c i t y a n d c a p a c i t y u t i l i -

s a t i o n

(31)

In the absence of cooperation from the Russian expor-
ters, the Commission, in accordance with Article 18(1)
of the basic Regulation, based its analysis on informa-
tion provided in the review request as well as on infor-
specialised
mation obtained from an independent
market study submitted by the complainant
in the
course of the investigation.

(32) According to the abovementioned sources, Russian
production capacity for urea in recent years is estimated
at around 5 300 Ktonnes p.a.. The same sources rate
actual Russian production at about 3 700 Ktonnes p.a..
Consequently, the Russian producers would be in a posi-
tion to produce an additional 1 600 Ktonnes p.a., repre-
senting 26,5 % of Community consumption in 1999.

2.1.2. R u s s i a n e x p o r t s

t o B r a z i l , M e x i c o a n d

T u r k e y

The large unused Russian production capacity,
the
substantial Russian export volumes to Brazil, Mexico
and Turkey and the low price level of these exports
(even lower than the Russian export prices to the
Community, which are already dumped to a significant
extent and which are generally lower than the prices of
the Community industry) indicate that there is a likeli-
hood that the expiry of the current anti-dumping meas-
ures against imports of the product concerned from
Russia would lead to a recurrence of significant volumes
of dumped exports on to the Community market.

(38) Without measures, Russian export volumes could indeed
easily reach the level of the previous IP, 117 Ktonnes, or
even 1994 levels, 300 Ktonnes. This is all the more
likely given the proximity of Russia to the Community
market. Russian export prices charged to Brazil, Mexico
and Turkey during the IP can serve as an indication of
the price level of possible future exports
to the
Community. Consequently, there is a likelihood of a
recurrence of high dumping in significant volumes.

D. DEFINITION OF THE COMMUNITY INDUSTRY

(39)

The investigation established that, during the IP, the 11
applicant Community producers represented more than
85 % of Community production of urea. Therefore, they
constitute the Community industry within the meaning
of Article 4(1) and Article 5(4) of the basic Regulation.

(33) As concerns the possibility of increased Russian sales in
the Commission found that
third country markets,
exports of Russian urea to third countries are already
taking place. Large volumes of exports to Brazil, Mexico
and Turkey were registered in 1999 and there is no
indication that domestic consumption in these countries
will
increase significantly in the coming years. These
markets are therefore unlikely to fully absorb any addi-
tional quantities that the Russian producers have the
capacity to produce.

(40)

(34)

Concerning the export prices, it was found that the price
of the Russian material sold on the Brazilian, Mexican
and Turkish markets was substantially below the price
level for Russian deliveries to the Community.

(35)

Imports into Brazil, Mexico and Turkey therefore appear
to be made at prices that are dumped to a larger degree
than Russian imports into the Community.

(36) Given the proximity of the Russian producers to the
European market and the higher possible margin on the
export prices there,
it is likely that at least part of
Russian exports to Brazil, Mexico and Turkey would be

E. ANALYSIS OF THE SITUATION IN THE COMMUNITY

MARKET

1. Consumption

The apparent Community consumption of urea was
established on the basis of the sales volumes of the
Community industry on the Community market, the
sales volume of other Community producers as well as
imports into the Community of urea from the country
concerned and all other third countries. Production for
taken into consideration when
captive use was not
establishing Community consumption since this produc-
tion is not sold on the free market but further processed
into different end-products, for which the product under
consideration is only one of
the components. The
import or otherwise
Community industry did not
purchase urea for captive use. Therefore sales of urea
produced for and used in the captive market were not in
competition with sales of urea produced for and sold in
the non-captive market and were thus not likely to be
subject to the effects of the dumped imports.

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(41) On this basis, consumption increased steadily by 25,8 %
during the period under review, from around 4,8 million
tonnes in 1996 to around 6 million tonnes in the IP.

place between 1996 and 1997, while production fell
slightly between 1998 and the IP.

2. Imports from the country concerned

3.2. Capacity and capacity utilisation

2.1. Volume and market share

(42)

It should be noted that import volumes from Russia
were still significant between 1990 and 1994, reaching a
level of 300 Ktonnes in 1994. During this time anti-
dumping measures were in place in the form of an
undertaking. On the basis of Eurostat figures, after the
form of the measure had been changed into a duty in
1995, there was a sharp drop between 1995 and 1996.
A reason for this decline was the change in the form of
the measure.
Import volumes then remained stable
between 1996 and 1998 and dropped significantly again
in the IP.
It cannot be excluded that the significant
increase in exports to the Community from other third
countries contributed to this decline.

(43)

The market share of
the imports from the country
concerned in the Community decreased from 0,9 % in
1996 to 0,4 % in the IP.

(47)

The capacity utilisation rate was relatively stable at
around 86 % in 1996 and 1997. Afterwards it decreased
to 84,7 % in 1998 and to 82,5 % during the IP.

(48) However, the ammonium used for the production of
urea can also be used for the production of other ferti-
lisers. The capacity utilisation rate for urea production as
well as its development is accordingly also affected by
the development of other fertilisers.

3.3. Sales in the Community

(49)

The total sales volume of the Community industry on
the Community market went up from around 3,2
million tonnes in 1996 to around 3,8 million tonnes in
the IP, which represents an increase of 17 %. The sales
increase was most notable between 1997 and 1998.

2.2. Prices

3.4. Stocks

(44)

The average cif import prices of the imports concerned
increased substantially following the imposition of the
anti-dumping duty, based on a minimum import price,
in 1995. As from 1998, a significant decline in import
prices was found to have occurred. However, since
1997, and even more markedly since 1998, the Russian
prices of urea were at the high end of the range of prices
charged in the Community by exporting producers of
other third countries, which partly explains why imports
originating in Russia could not gain market shares.

(45) An importers' association claimed that the Commission
should, for the purpose of price comparisons, take into
account the quality differences between Russian urea
and urea produced by the Community industry. In this
respect, the measures currently in place incorporate a
10 % quality adjustment. Moreover, the scope of an
expiry review, unlike the scope of certain interim
injury
reviews, does not require new calculations of
margins based on price comparisons.

(50)

The level of stocks is not considered a valid injury
indicator due to the seasonality of the sales, to the fact
that urea used for captive use is stored together with the
urea sold as such on the market and to the fact that urea
is partly stored by the producers themselves and partly
by cooperatives of farmers.

3.5. Market share

(51)

In an overall expanding market, despite the increase in
sales volumes, the Community industry's market share
in the Community market decreased from around 67 %
in 1996 to around 63 % in the IP, thus not benefiting
from the expansion of the market.

3.6. Prices

3. Economic situation of the Community industry

(52)

3.1. Production

(46)

sale on the Community market,

The total production of urea by the Community industry
for
i.e. excluding
production for captive use which represented around
25 % of
increased by 7,5 %
between 1996 and the IP. A significant increase took

total production, has

The average sales price of the Community industry fell
in each year from 1996 until the IP,
leading to an
overall decrease of almost 40 % between 1996 and the
IP, in line with the general price trend in the market. The
factors influencing this trend appear to be the presence
of
third countries on the
Community market and the dumping found concerning
other fertilisers such as ammonium nitrate and urea
ammonium nitrate solutions, which had a price depres-
sive effect on all nitrogen fertilisers. Moreover it should

from other

imports

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be noted that in April 1997 the People's Republic of
China imposed an import ban on urea. The Chinese
market is roughly four times larger than the Community
market and was, prior to that decision, mainly supplied
by imports. The import ban therefore had an impact on
the urea prices in the Community, since many third
countries used to deliver a sizeable portion of their
exports to the People's Republic of China. The declining
energy prices (natural gas being the main raw material
for the production of urea) may also have had an influ-
ence on the sales prices.

(59)

(60)

3.7. Profitability and return on investment

(53)

(54)

The profitability of the Community industry, expressed
as a percentage of net sales value, decreased steadily
between 1996 and the IP. This trend has to be seen in
the light of the price evolution, which showed indeed a
similar pattern. Profitability became negative in 1998
and the level of losses increased significantly in the IP.

The return on investments followed the decreasing trend
in profitability during the period under review. This
negative trend is even more marked due to the joint
effect of the decrease in profitability and the increase in
investments.

3.8. Cash flow

(55)

The cash flow generated by the Community industry in
relation to sales of urea followed very closely the profit-
ability trend.

3.9. Ability to raise capital

(56)

Companies manufacturing urea form a part of larger
groups. No difficulties have been reported.

3.10. Employment, productivity and wages

(57)

Employment decreased from 1 638 employees in 1996
to 1 469 employees in the IP, a decrease of about 10 %.
Productivity steadily increased during the period under
review. With respect to wages, they dropped in 1997,
but then followed the trend in productivity.

3.11. Investments

4. Imports from other third countries

The import volume of urea from third countries other
than Russia increased between 1996 and the IP by
around 665 Ktonnes, from 1 187 Ktonnes to 1 852
Ktonnes, on the basis of Eurostat.

It seems that this increase should be seen in the light of
the ban of urea imports in the People's Republic of
China in April 1997, which led some countries to
redirect their exports to other countries. These other
third countries increased their market share in the
Community by 6 percentage points between 1996 and
import prices,
the IP. The corresponding average cif
based on Eurostat, decreased significantly between 1996
and the IP.

5. Conclusion

(61) While

consumption on the Community market
increased, in 1996, i.e. immediately after the imposition
of the duty in 1995, the market share of Russia had
already fallen below 1 %. The average price of these
imports, as declared at customs, decreased and, in the IP,
were below the minimum import price of 115 ECU/
tonne. Russian imports were not able to gain market
shares, which was also due to the increasing presence of
other third countries on the Community market, the
prices of which were lower than the Russian ones as
from 1997.

(62)

the situation of

The expected improvement of
the
in principle
Community industry did not materialise,
due to the increased presence of other third country
suppliers on the market. While production and sales
volumes increased, other economic indicators deteri-
orated significantly,
i.e. capacity utilisation, market
shares, prices, profitability, return on investment, cash
flow, employment. In particular the sharp decrease in
the sales prices of the Community industry had a nega-
tive effect on its profitability. This situation should be
the increased presence in the
seen in the light of
Community market of imports from other third coun-
tries, which have gained significant market shares after
the imposition of the measures. It is to be noted that an
anti-dumping investigation has been initiated in October
2000 concerning imports of urea originating in a
(Belarus, Bulgaria,
number of other
third countries
Croatia,
Poland,
Romania and Ukraine). The Community industry, there-
fore,

in a difficult situation.

Lithuania,

Estonia,

is still

Egypt,

Libya,

(58)

considerable
The Community industry carried out
It should be
investments between 1996 and the IP.
noted that
investments made in ammonium plants,
which is an upstream investment, are also partly
included.
Investments were mainly related to direct
investments in plant and machinery of the urea and
ammonium production processes.

F. LIKELIHOOD OF A RECURRENCE OF INJURY

(63) With regard to the likely effect on the Community
industry of the expiry of the measures in force the
following factors were considered,
in line with the
elements summarised in recitals 37 and 38.

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(64)

There are clear indications that imports originating in
Russia will continue at dumped prices. Moreover, there
is a likelihood that
import volumes would increase
significantly given that the Russian exporting producers
have the potential to raise their production and export
large unused production
volume in view of
capacity. In addition, domestic consumption in Russia is
likely to stay at relatively low levels in the near future.

their

it

(65) Having regard to the Russian exporters' export price
behaviour on third country markets, namely Brazil,
Turkey and Mexico,
the Russian
is
exporting producers will adopt an aggressive price
behaviour in the Community in order to regain their lost
market shares. Indeed, as established in earlier proceed-
ings concerning fertilisers, even small volumes at low
price can have significant distorting and injurious effects
on this commodity market.

likely that

(66)

The Community industry is still in a difficult situation
having regard in particular to its profitability, which
the
markedly improved just after the imposition of
measures under consideration, but significantly deteri-
orated again thereafter. Given the precarious situation of
the Community industry, the likely volumes and prices
of imports from Russia subsequent to any repeal of
measures would put the Community industry at further
risk. Their impact on the Community industry would be
in all

likelihood material.

(67) On the basis of the above, it is concluded that, should
the measures be repealed, there is a likelihood of a
recurrence of injury from imports of urea from Russia.

G. COMMUNITY INTEREST

1. Introduction

(68)

Pursuant to Article 21 of the basic Regulation, it was
examined whether a prolongation of the existing anti-
dumping measures would be against the interest of the
the
Community as a whole. The determination of
Community interest was based on an appreciation of all
the
the
Community industry, the importers and traders as well
as the users of the product concerned. In order to assess
the likely impact of a continuation or non-continuation
of the measures, the Commission requested information
interested parties mentioned above.
from all

those of

involved,

interests

various

i.e.

measures have already been in place. The present review
therefore took into consideration any undue negative
impact on interested parties during the period following
the imposition of the measures.

(70)

The Commission sent questionnaires to 44 importers,
one importers association, five users associations and
one user of the product concerned and received replies
from one importer, one user, one users association and
from the importers association.

(71) On this basis it was examined, whether, despite the
conclusions on dumping, on the situation of
the
Community industry and on the likelihood of recurrence
of injurious dumping, compelling reasons existed which
would lead to the conclusion that
in the
Community interest to maintain measures in this partic-
ular case.

is not

it

2. Community industry

(72)

(73)

It
is considered that without maintaining the anti-
dumping measures imposed in the previous invest-
igation, injurious dumping is likely to recur and that the
situation of the Community industry, which worsened
during the period under review, will further deteriorate.

The Community industry has proven to be a structurally
viable industry, able to adapt to the changing conditions
on the market. This has been shown in particular by the
industry's profits achieved until 1997 and its investment
in state of the art production capacity. The success of
fair
these efforts strongly depends on existence of
competition on the Community market. In this respect,
it should be pointed out that in October 2000 an anti-
dumping investigation was initiated concerning imports
of urea originating in Belarus, Bulgaria, Croatia, Egypt,
Estonia, Lithuania, Libya, Poland, Romania and Ukraine.
On the other hand, the deterioration in employment,
profitability and sales prices was
the
Community industry recently closed down significant
nitrogen fertiliser capacities.

such that

3. Importers

(69)

It should be recalled that, in the previous investigation,
the adoption of measures was considered not to be
against the interest of the Community. Furthermore, it
should be noted that
investigation is a
review, thus analysing a situation in which anti-dumping

the present

(74) Of the 44 importers who received questionnaires, only
one replied. As a matter of principle, it claimed to be
against
the measures. However,
given the negligible importance of urea for its business,
it was concluded that that importer would not be seri-
ously affected by a continuation of the measures.

the continuation of

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Official Journal of the European Communities

9.5.2001

(75)

In view of the low level of cooperation, the fact that
importers generally deal with a wide range of fertilisers,
of which urea is only one, and the fact that urea was
available from numerous other sources not presently
subject to anti-dumping measures, it was concluded that
any negative impact of the continuation of measures on
importers would not be a compelling reason against the
continuation of measures.

4. Users

(76)

(77)

The users of the product concerned are mainly farmers
and companies manufacturing glues and plastics. The
Commission sent questionnaires to several users' asso-
ciations at the European and national levels. One users'
association representing 11 cooperatives of farmers, and
one user replied to the questionnaire. Both are, as a
matter of principle, against
the
measures. However, neither used urea originating in
Russia during the IP. The members of the users' associa-
tion purchased very small quantities of urea originating
from other sources throughout the period under review.
The individual user has encountered no problems in
sourcing urea from other third countries whilst
the
measures have been in force.

the continuation of

It is to be noted that, as also established in previous
investigations, fertilisers represent only a small part of
total production costs of farmers. With regard to the
above and to the low level of cooperation,
it was
concluded that the measures currently in force did not
have a significant negative impact on the users of urea.
In this respect it should be noted that none of the users
claimed that there had been a general price increase of
urea and/or reduction of their profitability since the
In view of the
current measures had been imposed.
above and having regard to the low level of cooperation,
it was concluded that any negative impact of the contin-
uation of measures on users would not be a compelling
reason against the continuation of measures.

H. ANTI-DUMPING MEASURES

(79) All parties concerned were informed of the essential
facts and considerations on the basis of which it was
intended to recommend the maintenance of the existing
anti-dumping duty in respect of imports of urea origin-
ating in Russia. They were also granted a period within
which to make representations subsequent to this disclo-
sure. No comments were received which were of a
nature to change the above conclusions.

(80)

It follows from the above that, as provided for by Article
11(2) of the basic Regulation, the anti-dumping meas-
ures currently in force with regard to imports of urea
originating in Russia should be maintained,

HAS ADOPTED THIS REGULATION:

Article 1

1.
A definitive anti-dumping duty is hereby imposed on
imports of urea falling within CN codes 3102 10 10 and
3102 10 90 originating in Russia.

2.
The amount of the definitive anti-dumping duty shall be
the difference between the minimum import price of EUR 115
per tonne and the net, free-at-Community-frontier price, before
duty, in all cases where the latter is less than the minimum
import price.

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

5. Conclusion

Article 2

(78) Given the above,

it was concluded that there are no
compelling reasons of Community interest against the
continuation of the measures.

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 2787/2000 (OJ L 330, 27.12.2000, p. 1).

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L 127/19

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

Done at Brussels, 7 May 2001.

For the Council

The President

B. RINGHOLM