Commission Decision No 1357/2001/ECSC of 4 July 2001 amending Decision No 283/2000/ECSC imposing a definitive anti-dumping duty on imports of certain flat-rolled products of iron or non-alloy steel, of a width of 600 mm or more, not clad, plated or coated, in coils, not further worked than hot-rolled, originating, inter alia, in India
Date: 2001-07-04
Institutions: European Commission
Subjects: anti-dumping duty, flat product, import, iron and steel product, third country

5.7.2001

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Official Journal of the European Communities

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COMMISSION DECISION No 1357/2001/ECSC

of 4 July 2001

amending Decision No 283/2000/ECSC imposing a definitive anti-dumping duty on imports of
certain flat-rolled products of iron or non-alloy steel, of a width of 600 mm or more, not clad,
plated or coated, in coils, not further worked than hot-rolled, originating, inter alia, in India

THE COMMISSION OF THE EUROPEAN COMMUNITIES,

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

Having regard to Commission Decision No 2277/96/ECSC of 28 November 1996 on protection against
dumped imports from countries not members of the European Coal and Steel Community (1) (the Basic
Decision), as last amended by Decision No 4035/2001/ECSC (2), and in particular Article 11(4) thereof,

After consulting the Advisory Committee,

Whereas:

(1)

(2)

(3)

(4)

(5)

(6)

A. PREVIOUS PROCEDURE

By Decision No 283/2000/ECSC (3), as last amended by Decision No 2113/2000/ECSC (4), (definitive
Decision), the Commission imposed, inter alia, a definitive anti-dumping duty of 10,7 % on imports
of hot-rolled coils (product concerned) originating in India, with the exception of imports from
several Indian companies specifically mentioned, which are either subject to a lesser rate of duty or
to no duty at all.

B. CURRENT PROCEDURE

The Commission subsequently received an application to initiate a ‘new exporter’ review of the
definitive Decision, pursuant to Article 11(4) of the basic Decision, from the Indian exporting
producer Ispat Industries Ltd (the company). This company claimed that it was not related to any of
the exporting producers in India subject to the anti-dumping measures in force with regard to the
product concerned. Furthermore, it claimed that it had not exported the product concerned during
the original period of investigation (1 January 1998 to 31 December 1998), but had exported the
product concerned to the Community since then.

The product covered by the current review is the same product as the one under consideration in the
definitive Decision.

The Commission examined the evidence submitted by the company and considered it sufficient to
justify the initiation of a review in accordance with the provisions of Article 11(4) of the basic
Decision. After consultation of
the Advisory Committee and after the Community industry
concerned had been given the opportunity to comment, the Commission initiated, by Decision No
2113/2000/ECSC, a review of the definitive Decision pursuant to Article 11(4) of the basic Decision
with regard to the company and commenced its investigation.

By the Decision initiating the review, the Commission also repealed the anti-dumping duty imposed
by the definitive Decision with regard to imports of the product concerned produced and exported
to the Community by the company and directed customs authorities, pursuant to Article 14(5) of the
basic Decision, to take appropriate steps to register such imports.

The Commission informed the company and the representatives of the exporting country. Further-
more, it gave other parties directly concerned the opportunity to make their views known in writing
and to request a hearing. However, no such request was received by the Commission.

(1) OJ L 308, 29.11.1996, p. 11.
(2) OJ L 63, 3.3.2001, p. 14.
(3) OJ L 31, 5.2.2000, p. 15.
(4) OJ L 252, 6.10.2000, p. 3.

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(7)

(8)

(9)

(10)

The Commission sent a questionnaire to the company and received a reply within the deadline. The
Commission also sought and verified all the information deemed necessary for the determination of
dumping. A verification visit was carried out at the premises of the company.

The investigation of dumping covered the period from 1 July 1999 to 30 June 2000 (the invest-
igation period).

C. RESULTS OF THE INVESTIGATION

1. New exporter qualification

The investigation confirmed that the company had not exported the product concerned during the
original period of investigation and that it had begun exporting to the Community after this period.

Furthermore, the company was able to satisfactorily demonstrate that it did not have any links, direct
or indirect, with any of the Indian exporting producers subject to the anti-dumping measures in
force with regard to the product concerned.

(11) Accordingly, it is confirmed that the company should be considered a new exporter in accordance
with Article 11(4) of the basic Decision, and thus an individual dumping margin should be
determined for it.

2. Dumping

Normal value

(12) As far as the determination of normal value is concerned, the Commission first established, for the
company, whether its total domestic sales of hot-rolled coils were representative in comparison with
its total export sales to the Community. In accordance with Article 2(2) of the basic Decision,
domestic sales were considered representative since the total domestic sales volume of the exporting
producer was at least 5 % of its total export sales volume to the Community.

(13)

(14)

The Commission subsequently identified those types of hot-rolled coils sold domestically by the
company that were identical or directly comparable to the types sold for export to the Community.
The investigation showed that the grades and dimensions of the product concerned exported into the
Community by the company are identical or comparable to the products sold on the domestic
market.

For each type sold for export to the Community by the exporting producer and found to be directly
comparable to the type sold on its domestic market, it was established whether domestic sales were
sufficiently representative for the purposes of Article 2(2) of the basic Decision. Domestic sales of all
types were considered sufficiently representative.

(15) An examination was also made as to whether the domestic sales of each type could be regarded as
having been made in the ordinary course of trade, by establishing the proportion of profitable sales
to independent customers of the type in question. In cases where the sales volume of the product
concerned sold at a net sales price equal to or above the calculated cost of production (profitable
sales) represented 80 % or more of the total sales volume and where the weighted average price of
that type was equal to or above cost of production, normal value was based on the actual domestic
price, calculated as a weighted average of the prices of all domestic sales made during the invest-
igation period, irrespective of whether all these sales were profitable or not. In cases where the
volume of profitable sales of the product concerned represented less than 80 % but 10 % or more of
the total sales volume, normal value was based on the actual domestic price, calculated as a weighted
average of profitable sales only.

(16)

In cases where the volume of profitable sales of any type of the product concerned represented less
than 10 % of the total sales volume,
it was considered that this particular type was sold in
insufficient quantities for the domestic price to provide an appropriate basis for the establishment of
the normal value.

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(17) Wherever domestic prices of a particular type sold by the company could not be used, constructed
normal value had to be used in preference to domestic prices of other exporting producers or to
domestic prices of other similar types. Due to the fact that only one company is concerned by this
investigation, the former option was not available. As to the use of similar types, the number of
different types and the variety of factors affecting them, would have meant in this case making
numerous adjustments, most of which would have had to be based on estimates. It was therefore
considered that the constructed value of the company formed a more appropriate basis to establish
normal value.

(18) As a result of the above tests, for 33 types normal value calculations were based on the actual
domestic sales prices of hot-rolled coils whilst for all other types (1006) normal value had to be
calculated, in accordance with Article 2(3) of the basic Decision, on the basis of a constructed value
that was determined by adding to the manufacturing costs of the exported models, a reasonable
percentage for selling, general and administrative expenses (SG&A) and reasonable profit margin.

(19)

(20)

(21)

To this end, the Commission examined whether the SG&A incurred and the profit realised by the
company on the domestic market constituted reliable data. Actual domestic SG&A expenses were
considered reliable since the domestic sales volume of the company concerned could be regarded as
representative when compared to the volume of export sales to the Community. The domestic profit
margin was determined on the basis of domestic sales made in the ordinary course of trade.

The company has claimed an adjustment to its cost of production for start-up costs because of low
capacity utilisation rate, pursuant to Article 2(5) of the basic Decision.

It was found that the company's costs for the investigation period were affected by the use of new
production facilities that required a very substantial investment and that were characterised by low
capacity utilisation rates. It was also established that these low capacity utilisation rates were partially
due to start-up operations. Consequently, pursuant to Article 2(5) of the basic Decision, the
Commission has adjusted the company's cost of production for the entire investigation period to
reflect the actual costs incurred during the last three months thereof, which corresponded to the
moment when the company was considered as commercially put to use pursuant to the applicable
Indian law.

Export price

(22)

Since all export sales to the Community were made to independent customers in the Community,
the export price was established in accordance with Article 2(8) of the basic Decision, namely on the
basis of export prices actually paid or payable.

Comparison

(23)

For the purpose of ensuring a fair comparison between normal value and export price, due
allowance in the form of adjustments was made for differences affecting price comparability in
accordance with Article 2(10) of the basic Decision.

(24) All of the export sales allowances with the exception of that for commissions, which was double
accounted, could be accepted. These relate to inland freight, other freight, bank charges, other
charges and packing.

(25) All the domestic sales allowances claimed by the company with the exception of that for duty

drawback could be accepted.

(26)

The duty drawback allowance that was claimed was calculated on the basis of the credits gained on
the basis of the DEPB scheme described in recital 40 of Commission Decision No 284/2000/ECSC (1)
that imposed a definitive countervailing duty on imports of the product concerned originating in
India. This scheme depends on the export sales quantities irrespective of whether or not any import
duties have been paid or whether any raw materials have actually been imported at all. Since the
company only imported negligible quantities of raw materials, it could not demonstrate that the
imported materials were physically incorporated in the final product when sold on the domestic
market of the exporting producer. This allowance cannot therefore be granted as it does not satisfy
the requirements of the basic Decision.

(1) OJ L 31, 5.2.2000, p. 44.

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Dumping margin

(27) According to Article 2(11) of the basic Decision, the dumping margin was established on the basis of
a comparison between the weighted average normal value by type and the weighted average export
price.

(28)

This weighted average dumping margin established for the company, expressed as a percentage of
the free-at-Community-frontier price, amounts to 46,5 %.

D. AMENDMENT OF THE MEASURES BEING REVIEWED

(29)

In the light of the foregoing, it is considered that a definitive anti-dumping duty should be imposed
at the level of the dumping margin found, but, in accordance with Article 9(4) of the basic Decision
should not be higher than the country-wide injury margin established for India by the definitive
Decision in the original anti-dumping investigation.

(30) No individual injury margin can be established in a new exporter review since the investigation,
pursuant to Article 11(4) of the basic Decision, is limited to the examination of the individual
dumping margin.

(31)

(32)

(33)

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

In the case in question the schemes investigated in India have been found to constitute export
subsidies within the meaning of Article 3(4)(a) of Decision No 1889/98/ECSC. As such, the subsidies
can affect the export prices of the Indian exporting producers, thus leading to increased margins of
dumping. In other words, the dumping margin established is wholly or partly due to the existence of
export subsidies. In these circumstances the anti-dumping duty needs to be adjusted to reflect the
actual dumping margin remaining after the imposition of the countervailing duties offsetting the
effect of the export subsidies.

E. ADJUSTMENT OF THE ANTI-DUMPING DUTY APPLICABLE TO JINDAL VIJAYANAGAR STEEL

LTD

Jindal Vijayanagar Steel Ltd applied for an accelerated review pursuant to Article 20 of Commission
Decision No 1889/98/ECSC, but did not apply for a review of the anti-dumping duty applicable to it.
Following the initiation of a review (2) an individual countervailing duty rate was established at 5,7 %
for this company. Given that pursuant to recital 255 of Commission Decision No 283/2000/ECSC
the anti-dumping duty is determined as the difference between the injury margin and the export
subsidy established, the anti-dumping duty applicable has to be adjusted. The injury margin attrib-
uted to Jindal Vijayanagar Steel Ltd is the residual
injury margin of 23,8 %. Consequently, the
anti-dumping duty applicable to products exported to the Community by this company has to be
fixed at 18,1 %.

(34) Accordingly, the rate of duty applicable to the free-at-Community-frontier price, before duty and

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

Company

Ispat Industries Ltd

Jindal Vijayanagar Steel Ltd

Dumping
margin

Injury margin

Export subsidy
margin

Proposed coun-
tervailing duty

AD duty to be
imposed

(%)

46,5

56,3

(%)

23,8

23,8

(%)

8,8

5,7

(%)

8,8

5,7

(%)

15

18,1

(1) OJ L 245, 7.9.1998, p. 3.
(2) OJ C 201, 14.7.2000, p. 2.

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F. RETROACTIVE LEVYING OF THE ANTI-DUMPING DUTY

(35) As the review has resulted in a determination of dumping in respect of the company Ispat Industries
Ltd, the anti-dumping duty applicable to this company shall also be levied retroactively from the date
of initiation of this review on imports which have been made subject to registration pursuant to
Article 3 of Decision No 2113/2000/ECSC.

G. UNDERTAKING

(36)

The company, Ispat Industries Ltd, offered a price undertaking concerning its exports of the product
concerned to the Community,

in accordance with Article 8(1) of the basic Decision.

(37) After examination of the offer, the Commission considered the undertaking as acceptable since it
would eliminate the injurious effects of dumping pursuant to Article 8(1) of the basic Decision.
Moreover, the regular and detailed reports which the company undertook to provide to the
Commission will allow effective monitoring. Furthermore, the nature of the product and the sales
structure of the company is such that the Commission considers that the risk of circumvention is
limited.

(38)

In order to ensure the effective respect and monitoring of the undertaking, when the request for
release for free circulation pursuant to the undertaking is presented, exemption from the duty is
conditional upon presentation to the customs service of the Member State concerned a valid
issued by Ispat Industries Ltd and containing the information listed in the
‘commercial
Annex. Where no such invoice is presented, or when it does not correspond to the product
presented to customs, the appropriate rate of anti-dumping duty should be payable in order to
ensure the effective application of the undertaking.

invoice’

(39)

In the event of a breach or withdrawal of the undertaking an anti-dumping duty may be imposed,
pursuant to Article 8(9) and (10) of the Basic Decision.

H. DISCLOSURE AND DURATION OF THE MEASURES

(40)

(41)

The companies were informed of the facts and considerations on the basis of which it was intended
to impose the amended definitive anti-dumping duty on their exports to the Community.

This review does not affect the date on which Decision No 283/2000/ECSC will expire pursuant to
Article 11(2) of the basic Decision,

HAS ADOPTED THIS DECISION:

Article 1

Article 1(2) of Commission Decision No 283/2000/ECSC is hereby amended by adding the following

1.
to the section headed ‘India’:

Company

Rate of AD duty

TARIC additional code

‘Ispat Industries Ltd, Park Plaza, 71 Park Street,
Calcutta — 700 016, India

Jindal Vijayanagar Steel Ltd, Jindal Manison, 5-A. G. Desh-
mukh Marg, Mumbai — 400 026, India

15 %

18,1 %

A204

A270’

The duty hereby imposed shall also be levied retroactively on imports of the product concerned

2.
which have been registered pursuant to Article 3 of Decision No 2113/2000/ECSC.

Unless otherwise specified, the provisions of the Community Customs Code and its related legislation

3.
shall apply.

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Article 2

1.
Imports shall be exempt from the anti-dumping duty imposed by Article 1 provided that they are
produced and directly exported (i.e. invoiced and shipped) to a first unrelated buyer acting as an importer in
the Community by Ispat Industries Ltd, TARIC code A204, and that the conditions set out in paragraph 2
are met.

2. When the request for release for free circulation is presented, exemption from the duties shall be
conditional upon presentation to the customs service of the Member State concerned of a valid ‘commercial
invoice’ issued by Ispat Industries Ltd, containing the essential elements listed in the Annex to this Decision.
Exemption from the duty shall further be conditional on the goods declared and presented to customs
corresponding precisely to the description on the ‘commercial

invoice’.

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

Article 3

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

Done at Brussels, 4 July 2001.

For the Commission

Pascal LAMY

Member of the Commission

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ANNEX

INFORMATION NECESSARY FOR THE COMMERCIAL INVOICES ACCOMPANYING SALES MADE SUBJECT
TO THE UNDERTAKING

1. The heading ‘Commercial invoice accompanying goods subject to an undertaking’

2. The name of the company issuing the commercial

invoice

3. The commercial

invoice number

4. The date of issue of the commercial

invoice

5. The TARIC additional code under which the goods on the invoice are to be customs-cleared at the Community frontier

(as specified in the Decision),

6. The exact description of the goods,

including:

— the company product code number (CPC) (if applicable),
— the product code number (PCN) (as established in the undertaking offered by the producing exporter in question),
— the technical specification of the PCN,
— CN code,
— quantity (to be given in tonnes),

7. The description of the terms of the sale,

including:

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

8. Name of the first unrelated buyer acting as an importer to which the invoice is issued directly by the company.

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

‘I, the undersigned, certify that the sale for direct export to the European Community of the goods covered by this
invoice is being made within the scope and under the terms of the undertaking offered by Ispat Industries Ltd and
accepted by the European Commission through Decision (1357/2001/ECSC). I declare that the information provided
in this invoice is complete and correct.’