Council Regulation (EC) No 92/2002 of 17 January 2002 imposing definitive anti-dumping duty and collecting definitively the provisional anti-dumping duty imposed on imports of urea originating in Belarus, Bulgaria, Croatia, Estonia, Libya, Lithuania, Romania and the Ukraine
Date: 2002-01-17
Institutions: Council of the European Union
Subjects: anti-dumping duty, chemical fertiliser, import, third country

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(Acts whose publication is obligatory)

COUNCIL REGULATION (EC) No 92/2002

of 17 January 2002

imposing definitive anti-dumping duty and collecting definitively the provisional anti-dumping
duty imposed on imports of urea originating in Belarus, Bulgaria, Croatia, Estonia, Libya, Lithuania,
Romania and the Ukraine

THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty establishing the European
Community,

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

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

Whereas:

A. PROVISIONAL MEASURES

The Commission, by Regulation (EC) No 1497/2001 (2)
(the provisional Regulation) imposed a provisional anti-
dumping duty on imports of urea falling within CN
codes 3102 10 10 and 3102 10 90, and originating in
Belarus, Bulgaria, Croatia, Estonia, Libya, Lithuania,
Romania and the Ukraine.

In the same Regulation it was decided to terminate the
proceeding as regards imports of urea originating in
Egypt and Poland.

B. SUBSEQUENT PROCEDURE

Subsequent to the disclosure of the essential facts and
considerations on the basis of which it was decided to
impose provisional measures on imports of urea from
Belarus, Bulgaria, Croatia, Estonia, Libya, Lithuania,
Romania and the Ukraine, several
interested parties
submitted comments in writing. The parties, which so
requested were also granted an opportunity to be heard
orally.

The Commission continued to seek and verify all infor-
mation it deemed necessary for its definitive findings.

Additional verification visits were carried out at
premises of the following:

the

(1)

(2)

(3)

(4)

(5)

(1) OJ L 56, 6. 3. 1996, p. 1. Regulation as last amended by Regula-

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

(2) OJ L 197, 21.7.2001, p. 4.

C o m m u n i t y p r o d u c e r s
— Fertiberia, Madrid.
— Hydro Agri France, Paris.

U s e r s i n t h e C o m m u n i t y
— Libera

Associazione

Agricoltori

Cremonesi,

(6)

(7)

(8)

(9)

Cremona.

the essential

All parties were informed of
facts and
considerations on the basis of which it is intended to
recommend the imposition of definitive anti-dumping
duties and the definitive collection of amounts secured
by way of provisional duties. They were also granted a
period within which they could make representations
subsequent to this disclosure.

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

C. PRODUCT UNDER CONSIDERATION AND LIKE

PRODUCT

In the absence of any comments, the definition of the
product under consideration and the like product as
described at recitals 9 to 12 of the provisional Regula-
tion are confirmed.

D. DUMPING

1. Market economy countries

Normal value

Application of Article 18 of the Basic Regulation

The exporting producer in Libya claimed that recital 63
the provisional Regulation does not accurately
of
describe the level of cooperation provided. It claimed
that the Commission was aware and implicitly accepted
the fact that the overall company accounts covering all
activities of the group would not be submitted due to
confidentiality reasons. It furthermore claimed that in
line with Libyan accounting requirements, no public
audited accounts have to be filed and therefore,
in
accordance with Article 2(5) of the Basic Regulation, the
Commission should not have rejected the company's
accounts on these grounds.

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refusal

(10) As far as the level of cooperation is concerned, the
it
Commission has never given any indication that
accepted the company's
to submit essential
accounting documents. On the contrary, it has repeat-
edly informed the exporting producer of the possible
the Basic Regulation
application of Article 18 of
including the use of best facts available, due to the
deficient level of cooperation. Nevertheless, the company
maintained its position and did not submit substantial
information necessary to reconcile in particular domestic
the product
sales and the cost of production of
concerned. Under these circumstances, and in order to
determine the normal value for the company concerned,
the Institutions had no choice but to make use of facts
available, and namely of information provided in the
complaint, in accordance with Article 18 of the Basic
Regulation.
to
assume, as the company did, that the absence of publicly
audited accounts was the reason for the use of facts
available in the determination of the normal value.

is incorrect

In view of

the above,

it

(11)

(12)

(13)

This is also confirmed by the fact that the reported data
were used whenever it was possible to reasonably verify
and reconcile it with the company's internal accounts, in
particular when establishing the export price of
the
Libyan exporting producer (see recital 67 to 72 of the
provisional Regulation).

The same exporting producer claimed that its normal
value should have been established on the basis of the
actual domestic sales price or alternatively constructed
on the basis of the company's own accounting data,
rather than on the basis of the data submitted by the
Community industry in the complaint. It argued that, for
this purpose, all necessary evidence and information
related to the production and sales of urea on the Libyan
domestic market was provided.

The company failed consistently to submit essential
information in the reply to the questionnaire and to
satisfactorily explain inconsistencies and contradictions
revealed during the verification visit, despite of the fact
that these were expressly pointed out by the Commis-
sion in deficiency letters and on-spot. It was therefore
not possible to establish the completeness and correct-
ness of the domestic sales reported, nor of the cost of
production submitted. Consequently, as
the
submission of evidence and information related to the
production and sales of urea on the Libyan domestic
market is concerned, the findings of recital 64 and 65 of
the provisional Regulation are confirmed.

far as

complaint in accordance Article 18 of the Basic Regula-
tion.

(15)

The same exporting producer claimed that, in any case,
the profit margin used in the complaint in order to
construct normal value was overestimated. It argued in
support of its claim that profit margins in the urea
business are traditionally low.

(16) On the basis of the findings regarding other cooperating
exporting producers in this proceeding, the Commission
considered it appropriate to review the level of the profit
margin used for constructing the normal value of the
exporting producer in Libya.

(17) As outlined in recital 22 of the provisional Regulation,
the average profit margin realised by the cooperating
exporting producers in the present investigation when
selling the product
concerned on their domestic
markets, in accordance with Article 2(6)(c) of the Basic
Regulation, has been used to construct the normal value
of
those exporting producers for which the profit
margin could not be established in accordance with the
chapeau of Article 2(6) of the Basic Regulation or its
subparagraphs (a) and (b). Considering that no valid
reason could be identified which would justify to apply a
different profit margin to the Libyan exporting producer,
and in the absence of any more appropriate information,
it was decided to apply at the definitive stage this same
profit margin to the Libyan producer in order to estab-
lish normal value.

Normal value based on domestic sales

(18)

Two exporting producers in Romania submitted that
normal value should be established on a monthly basis
due to inflation in Romania during the investigation
period. This methodology has been used at the provi-
sional stage for all exporting producer in Romania.

(19) After imposition of the provisional anti-dumping duties,
this approach was however re-analysed. The invest-
igation has shown that the effects of the inflation were
not such as to justify the calculation of monthly normal
values. It is the Institution's consistent practice to estab-
lish average normal values for the investigation period
except in situations such as hyperinflation. These condi-
tions were however not fulfilled in the case of Romania.

(14) As mentioned in recital 66 of the provisional Regula-
tion, in the absence of any other reliable information
normal value for the exporting producer in Libya had to
be established on the basis of the data submitted in the

(20)

It was consequently considered appropriate to establish
the definitive stage for each
the normal value at
exporting producer in Romania on the basis of
the
average price paid on the domestic market during the
investigation period.

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Constructed normal value

(21)

(22)

for

the exporting producers

The Community industry claimed that for the deter-
mination of the profit margin used in the construction
of normal values
in
Bulgaria, Estonia and Lithuania, the minimum return on
capital employed ‘normally necessary to sustain a viable
urea business over the medium-long term’ should have
been used.
It was argued that profit margins in the
above countries would in general not be reliable due to
‘overhangs’ of the non market economy system in the
accounting policies of the companies concerned.

The investigation did not reveal any evidence or infor-
mation indicating that the accounts of the companies
concerned were not reliable and could thus not be used
in the determination of the profit margin. Therefore, the
Institutions had no alternative but to establish normal
values in accordance with Article 2(3) and (6) of the
Basic Regulation. Thus, profit margins were established
in accordance with Article 2(6)(b) and (c) of the Basic
Regulation, i.e. on the basis of the profit realised for the
same general category of products produced and sold by
the exporting producer concerned on the domestic
market in the case of Lithuania; and in the case of
Bulgaria and Estonia on any other reasonable basis, i.e.
on the basis of the weighted average profit margin found
for the other cooperating exporting producers in this
proceeding.

(23) However the level of the profit margin which was estab-
lished in accordance with Article 2(6)(c) of the Basic
Regulation on the basis of the weighted average profit
margins of cooperating exporting producers with profit-
able domestic sales was re-examined. Further to the
termination of the proceeding as regards imports of urea
originating in Egypt, exporting producers from Egypt
were excluded from the calculation of the average profit
margin.

(24)

the Estonian exporting
Following the comments of
producer the profit margin used for the reconstruction
of its normal value was reassessed. A re-examination of
the provisional findings made apparent that the profit
margin used — based on the sales of other products by
the company — had to be reviewed, since these prod-
ucts could not be considered as being part of the same
general category as the product concerned (i.e. ferti-
lisers). Thus,
in the absence of sufficient sales in the
ordinary course of trade, of any other Estonian expor-
ters/producers of the product concerned and/or other
the same general category sold by the
products of
Estonian company concerned, any other
reasonable
method has been applied at the definitive stage pursuant
to Article 2(6)(c) of the Basic Regulation. In this regard,
the profit margin has been based on the weighted

(25)

(26)

average profit margin of the other cooperating exporting
producers concerned (as for the Bulgarian exporting
producer, see recital 22 above).

The Lithuanian exporting producer has argued against
the use of selling, general and administrative costs
(SG&A) and profit of ammonium nitrate (AN)
in
It claimed that urea and
constructing normal value.
ammonium nitrate are different
sold in
different markets and in different competitive situations,
and with differences
in manufacturing technology,
market demand, selling prices and costs.

fertilisers,

Since there is only one producer of urea in Lithuania,
and in the absence of representative domestic sales,
Article 2(6)(b) of the Basic Regulation is a possibility for
the determination of SG&A and profit. Also, urea and
AN are both nitrogen fertilisers and, even if differences
in production technology exist to some extent, they do
belong to the same general category of products, as
required by the Basic Regulation. For the sake of argu-
ment, markets and competitive situations are not dissim-
ilar (one producer, import competition). In view of the
above, it was decided to maintain the provisional deter-
mination.

Export price

(27)

In the absence of any comments by the interested
parties, or any other findings which could devaluate the
provisional findings, the export prices of the exporting
producers concerned as established provisionally are
hereby confirmed.

Comparison

Handling and loading cost

(28)

comments

received by the Libyan
Following the
exporting producer with regard to the calculation of
loading and handling costs when exporting the product
concerned to the Community, the Commission reviewed
its calculations and found a calculation error which was
corrected accordingly.

2. Non-market economy countries

(29)

The exporting producer from Belarus contested the fact
that the Commission has allegedly treated it as a non
cooperating party in the proceeding. The company
claimed to have provided to the Commission all the
information requested and considered that the reason
for being treated as a non cooperator was to deprive it
of its rights as a cooperating party and namely of the
opportunity to offer an undertaking.

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(30)

(31)

In the present investigation, the fact that the company
did not provide the information required to establish a
verifiable export price led to the application of the rule
set in Article 18 of the Basic Regulation for non-cooper-
ating parties and consequently to the partial use of ‘facts
in this case the export figures provided by
available’,
Eurostat.

(35)

Individual treatment

individual

The Community industry objected to the decision to
grant
the Ukrainian
exporting producers arguing that the shareholding of the
State in the company would allow significant State inter-
ference.

to one of

treatment

It is nevertheless noted that, contrary to the company's
allegations, the partial application of Article 18 did not
deprive it of any of its rights as an interested party, and
namely of the right to receive disclosure, to be heard
and to present written submissions,
to consult non
confidential files and the opportunity to offer an under-
taking.

(36) However, no new information or

evidence was
submitted by the complainant Community industry
showing that the alleged State interference would permit
circumvention of the measures imposed and the claim
had thus to be rejected. The findings of the provisional
Regulation (recital 132) are consequently confirmed.

Market economy status (‘MES’)

(32) As outlined in recital 118 to 130 of the provisional
Regulation,
in accordance with Article 2(7)(b) of the
Basic Regulation, three companies in the Ukraine filed
applications that market economy conditions prevail in
respect of the manufacture and sale of the like product
concerned (‘market economy status’ or ‘MES’).
is
recalled that two Ukrainian companies received MES.
One Ukrainian exporting producer, which was refused
MES, disagreed with the Commission's findings on
possible State interference.

It

(33)

(34)

The Community industry re-iterated its claim that
companies
in the Ukraine producing and selling
nitrogen fertilisers including urea, are subject to signifi-
cant State interference and that therefore, on a general
basis, no MES should have been granted. In particular, it
argued that the Ukrainian fertiliser market was charac-
terised by the existence of tolling agreements, barter
chain arrangements and State interference in energy,
electricity and transportation cost, and that all these
factors were incompatible with a market economy situa-
tion.

These arguments by the exporting producers and the
Community industry have already been treated in reci-
tals 118 to 130 of the provisional Regulation.
It is
nevertheless added that concerning tolling agreements, it
was considered that these are not per se in contradiction
with MES, since they cannot necessarily be considered as
a typical characteristic of State interference. As far as the
State interference in transport costs is concerned, this
was taken into account by using the transport rates
applicable in the analogue country. Concerning energy
and electricity costs, no evidence was found that these
costs were significantly distorted by State interference
and that they did not substantially reflect market value.
Furthermore, compared with natural gas, the cost of
energy and electricity is not a major input of urea.

Sales under tolling agreements

(37) As described in recitals 133 to 135 of the provisional
Regulation three
in the Ukraine were
companies
involved in tolling agreements. It is recalled that, under
Ukrainian law, the provider of the raw materials remains
the owner of the finished product, the company doing
the transformation does not acquire property rights over
the goods.

(38)

(39)

The investigation revealed that one of the companies
which was granted MES could not be considered, on its
own, an exporting producer of the product concerned.
This company had established a long-term business rela-
tionship with another company based in a third country.
According to this relationship, the latter company was
virtually the sole supplier under tolling agreements (and
owner throughout the production process) of the main
raw material. This company was also actively involved
on the export sales of the product concerned. These
facts clearly indicated that the relationship between these
companies went beyond the usual buyer-seller relation-
ship.

In the absence of any cooperation from the associated
gas supplier, neither the full cost of manufacturing nor
the price paid or payable on export sales could be
established,
let alone verified. It should also be noted
that although certain information on export prices to
the first independent buyer was available, this informa-
tion was not verifiable and could therefore not be used
to establish a dumping margin. Since without
the
cooperation of the associated supplier (and legal owner
of both the main raw material and the finished product),
neither the normal value nor the export price of the
Ukrainian company concerned could be reliably estab-
lished. Therefore, an individual dumping margin could
not be established for this company.

(40) Another Ukrainian company, which was neither granted
MES nor individual treatment, realised all its export sales
under tolling agreements. In the absence of any coopera-
tion of its gas supplier, and in the absence of verifiable

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(41)

(42)

export prices to the first independent buyer, the prices
of these transactions were established as described in
recital 66 below in the purpose of the assessment of the
country-wide dumping margin.

Finally, a third company has done part of its domestic
and export sales under tolling agreements. Likewise, in
the absence of cooperation from its suppliers, and in the
absence of verifiable prices to the first
independent
buyer, the Community Institutions had no option but to
disregard all sales made under such tolling agreements.
The remaining domestic sales were still representative, as
determined in recital 138 of the provisional duty Regu-
lation.

Two further Ukrainian companies which had also sales
on the basis of tolling and whose gas suppliers equally
refused to cooperate argued nevertheless that the sales
data submitted was accurate and reliable and that they
had provided sufficient evidence allowing these transac-
tions to be taken into account when determining normal
value or export price.

(43) During the verification visit

it was established that
neither the invoice prices nor the payments for urea
were included in the accounting records of these compa-
nies. In the absence of any cooperation by the suppliers
of gas, in which accounts these data should normally be
registered, or of any evidence of the actual payments for
these transactions, the information could not be verified
and could not, therefore, be accepted.

Normal value

(i) Analogue country

(44)

(45)

Three Ukrainian exporting producers argued that their
normal value should not have been based on the
domestic prices and costs of an analogue country, but
that the normal value based on domestic sales of an
Ukrainian exporting producer which was granted MES
should have been used instead.

It is the Community institutions' consistent practice, in
line with Article 2(7)(b) of the Basic Regulation, to deter-
mine normal value on the basis of paragraphs 1 to 6 of
Article 2 of the Basic Regulation only for those produ-
cers that can show that they operate in line with market
economy conditions. For all other producers in the same
country, normal value is determined on the basis of
Article 2(7)(a), i.e. on the basis of a price or constructed
value in a market economy third country, or on any
other reasonable basis foreseen in Article 2(7)(a). No
changes are therefore warranted in this respect to the
provisional findings.

(46)

The Belarussian exporting producer,
three Ukrainian
exporting producers, the government of Belarus and the
Ukraine as well as an importer association objected to
the choice of the USA as an analogue country claiming

that Lithuania was a more appropriate market economy
third country.

(47)

its different

These parties alleged that the USA was not an appro-
priate choice because of its high gas costs which would
lead to distorted urea prices,
level of
economic development compared to Belarus and the
Ukraine, and differences in market size. The fact that
only one producer in the USA cooperated was also seen
as an argument not to use USA as a market economy
third country. It was further argued that Lithuania was
the most appropriate analogue country. It was claimed
that
the volume of urea produced in Lithuania was
representative as compared to the volume of exports of
urea from the Ukraine and Belarus to the Community
during the IP. It was moreover claimed that Lithuania
would be an open, competitive market where no import
duties exist, with a similar access to natural gas, and a
similar production process as
in Belarus and the
Ukraine. The fact that there was only one producer of
urea in Lithuania was also considered irrelevant by the
parties, as Lithuania and other countries with one
producer of the product concerned have already been
used in previous investigations of products belonging to
the same category.

(48)

The Community institutions have examined all
the
above arguments in detail and came to the following
conclusions:

(49) While on the USA market more than ten producers of
urea are operating compared to at least five producers in
Ukraine, there is only one producer in Lithuania. Despite
the fact that anti-dumping duties exist in the USA on
imports of urea from former Soviet Union countries,
there were substantial
imports (more than 1 million
tons) of urea from a number of other third countries.
Although the further investigation revealed that there are
no import duties applicable in Lithuania to imports of
urea, those imports remain nevertheless at a very low
level. The USA has a vast urea market (more than 10
million tons per year), whereas the Lithuanian urea
market is practically non-existing. Thus, sales of urea
during the investigation period (‘IP’) on the Lithuanian
market were minimal and, according to the information
provided by the Lithuanian producer, not made in the
ordinary course of trade. It has thus been concluded that
the US-market for urea is highly competitive, in contrast
with the Lithuanian market. Finally, and contrary to
Lithuania, domestic sales in USA are representative when
compared to Belarus and Ukrainian exports to the
Community.

(50)

The fact that only one US producer cooperated in this
investigation does not render the above conclusions
invalid. In fact, the prices of this producer, which were
used to establish normal value are subject to the above-
sold by this
described competition. The quantities
producer
representative when
compared to the total quantities exported from Belarus
and Ukraine to the Community.

alone were

even

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(51)

Regarding the similarity in access to natural gas, the
main raw material used for the production of urea, an
analysis of the supplies to the urea producers was also
made.
It was confirmed that while the American
producer had natural gas supplied by more than one
supplier, as it was the case in Ukraine, the Lithuanian
producer had only a single supplier and no possible
alternative suppliers. In addition, similar to Ukraine, the
USA is both a producer and an importer of natural gas,
while Lithuania has no own natural gas resources.

(ii) Normal value for companies granted MES

(58)

The Ukrainian company, which had almost all its sales
made under tolling agreements, argued that its domestic
sales should be used as a basis for the determination of
its normal value. As alternatives, the company proposed
the Commission to use the normal value of an Ukrainian
exporting producer to which MES was granted or to
construct normal value on the basis of the company's
own data.

(52)

The Commission has
also compared production
processes in the USA and Belarus and the Ukraine and
concluded that the technology used by the American
producer was at least as efficient as the one used by the
Belarus and Ukrainian producers.

(59) As a consequence of non-cooperation by the associated
supplier of gas,
it was concluded that this Ukrainian
company could not be qualified, on its own, as an
exporting producer of urea (see details in recitals 38 and
39). Consequently, no normal value was established.

(53)

It was also argued that Lithuania should be used as the
analogue country since it was subject to the same invest-
igation.

(54)

The Commission notes that Article 2(7) of the Basic
Regulation stipulates that, where appropriate, a market
economy country which is subject to the same invest-
igation shall be used. However, for the reasons outlined
in recitals 49 to 51, Lithuania could not be considered
as an appropriate analogue country in this investigation.

(55) As already stated in recital 107 of the provisional Regu-
lation, an adjustment was made to the high natural gas
cost during the IP in the USA. The high natural gas cost
was the result of a market situation specific to the USA
during the IP. This adjustment brought the gas cost
down to a level comparable to the one of other compa-
nies cooperating in this same proceeding.

(56)

(57)

The Community industry supported the choice of the
USA as an analogue country. However, it claimed that
gas prices in the USA experienced only mild increases
and that
therefore no adjustment should have been
made in this regard. While it is correct that the sharpest
increase in gas prices took place only in the second half
it was found that
i.e. after the IP,
of the year 2000,
during the second half of the IP there was already an
unusual and specific increase in the cost of natural gas.
The adjustment made was therefore considered justified.

For all the above reasons, it is concluded that the USA is
an appropriate analogue market economy country and
was selected in a not unreasonable manner. A normal
value based on the domestic sales in the USA made in
the ordinary course of trade, which includes a reason-
able and not excessive profit margin, is therefore fully in
line with the requirements of Article 2(7)(a) of the Basic
Regulation.

(60) As announced in recital 138 of the provisional duty
Regulation,
it was further examined whether adjust-
ments to other cost factors, and in particular to depre-
ciation incurred by the Ukrainian exporting producer for
which normal value was based on its own data, were
necessary.

(61) A comparison of the depreciation cost included in the
cost of production of the different production facilities
of the cooperating producer in the analogue country
with the depreciation incurred by the Ukrainian
producer showed certain differences. However,
these
differences could have been caused by numerous factors
and were in any event not such as to warrant an adjust-
ment to the Ukrainian producer's cost. Moreover, as the
normal value for this Ukrainian producer was based on
domestic sales, any change to the cost would have a
negligible impact, if any. No adjustments were therefore
made.

Export price

(62)

(63)

Two companies in the Ukraine, whose export sales were
made on the basis of tolling agreements and therefore
excluded from the dumping calculations, submitted that
their export price should be constructed on the basis of
the transformation fee charged to their export customers
the gas cost paid by themselves or another
plus
exporting producer
in Ukraine, plus a reasonable
amount of profit.

For one of the companies, as a consequence of non-
cooperation of the associated supplier of gas, not only
the prices of its exports sales were not verifiable, but this
company could not be qualified, on its own, as an
exporting producer of urea (see details in recitals 38 and
39). Consequently, no individual dumping margin has
been established for it.

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(64)

company,

the other

the methodology
Regarding
proposed is not in line with Article 2(9) of the Basic
Regulation. The purpose of this Article is not to provide
alternative methods to establish export prices in cases of
non cooperation, but instead to take account of the
participation in the export sales, of an importer in the
Community related or associated with the exporting
producer. The construction proposed by the Ukrainian
companies, contrary to what is established on Article
2(9) of the Basic Regulation, is not based on any price of
sale to an independent party. Instead it uses as a starting
point a cost of manufacture (a method used to construct
normal values, not exporting prices). The claim was
therefore rejected.

(65) A third Ukrainian company, which also had all

its
export sales made under tolling agreements, argued that
rather than taking the lowest export prices, the average
export price of other Ukrainian exporting producers
should have been used.

(66) However, there was no reason to believe that the average
export price of other Ukrainian exporting producers was
more accurate. It is the Community Institutions' practice,
in cases of non-cooperation to use the weighted average
export price of the transactions with the lowest export
prices, representing at
the same time a considerable
quantity of the export quantities with verifiable prices.

Comparison

(67)

(68)

Two Ukrainian companies and one Belarussian company
claimed that the Commission should provide them with
basic information to allow them to claim natural
comparative advantages.

Since only one US company cooperated in the
proceeding, no specific evidence regarding production
and sales' details of this company could be disclosed
without breaching the rules on confidentiality. Other
basic information (geographic location, access to raw
is publicly available. The Community
materials, etc.)
Institutions have analysed the available information and
have made, on their own initiative, the necessary adjust-
ments. It is re-called that an unusually high natural gas
cost during the IP in the USA was identified and conse-
quently, an adjustment made to the gas cost used for the
cooperating USA company brought the gas cost down
to a level comparable to the one of other companies
cooperating in this same proceeding.

(69)

Three Ukrainian companies
the Belarussian
company disagreed with the fact that the Commission
made an adjustment for inland transport to the export
price based on railway tariffs in the analogue country. It

and

was argued that Ukrainian tariffs should be used, or
alternatively, Lithuanian tariffs.

(70)

(71)

(72)

(73)

Railway tariffs in Ukraine and Belarus, countries which
are not yet operating under market economy conditions,
are set by the State and cannot, therefore, be considered
to reflect normal market prices. It is a long established
practice of the Community Institutions to base adjust-
ments for this type of inland transport for countries
under Article 2(7) of the Basic Regulation, on verified
data from the analogue country, when available. It was
also specifically mentioned when granting MES to some
of the Ukrainian companies involved that certain cost
factors could be corrected to bring them in line with
normal market value. No change to the provisional find-
ings is therefore warranted.

It was also claimed that lower tariffs should be applied
as Ukrainian exporting producers used own railway
wagons with large consignments,
including return of
empty wagons.

Information from the producer in the analogue country
revealed that an adjustment for the use of own wagons
was warranted. The calculations were therefore revised
accordingly.

It was argued by the Ukranian and Belarussian compa-
nies that the adjustment made for physical differences
between ‘granular’ urea sold on the domestic market of
the analogue country and ‘prilled’ urea exported by these
countries should have been based on price differences
on the European market.

(74) However, since the aim is to determine a normal value
for prilled urea on the analogue country market, the
adjustment must be based on a price difference on that
same market. The adjustment made has thus been based
on price differences on the US market. To use the
Community market does not appear to be appropriate
because the price difference on that market will in all
likelihood be influenced by dumping practices. Conse-
quently, the claim was rejected.

(75)

Two Ukrainian companies and the company in Belarus
also claimed an adjustment for level of trade as they
were allegedly selling only to traders.

(76)

The exporting producers in the Ukraine and Belarus
exported the product concerned to traders. The cooper-
ating producer in the analogue country sold the product
also to traders. Part of the domestic sales of the analogue
country producer were made to blenders. A thorough
analyses of functions and prices revealed that the claim
was not warranted.

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3. Dumping margin for companies investigated

L i b y a

Application of Article 18 of the Basic Regulation

(77)

(78)

Subsequently to the imposition of provisional duties, the
Commission further examined whether the freight costs
reported by the Lithuanian exporting producer, but paid
by the importers, were accurate. It was found that these
costs were overstated when compared to information
collected from importers and with publicly available
quotations for the same routes. The amounts for freight
costs have been revised accordingly and the actual costs
have been used.

Following the comments of
the Estonian exporting
producer concerning the inappropriateness of an adjust-
ment of the cif value of the unreported sales used to
express the dumping margin for these sales that was
made at the provisional stage, the Commission analysed
the issue in more detail and decided to revise the meth-
odology used. The adjustment made at the provisional
stage has been withdrawn. However, in the absence of
reliable information provided by the company,
the
Commission decided to base its findings on the informa-
tion provided by Eurostat, since it constitutes the most
reliable data available.

(79)

The Commission provisionally made an adjustment to
the cif value of the Belarussian exporting producer used
to calculate the dumping margin. Since this adjustment
was made erroneously, the adjustment was withdrawn.

Dumping margins

(80)

a
The definitive dumping margins,
percentage of the cif import price at Community border,
are:

expressed as

B e l a r u s

All companies:

B u l g a r i a

— Chimco AD:

— Others:

C r o a t i a

— Petrokemija d.d.:

— Others:

E s t o n i a

— JSC Nitrofert

— Others:

67,3 %

90,3 %

90,3 %

72,9 %

72,9 %

37,4 %

37,4 %

— National Oil Corporation:

— Others:

L i t h u a n i a

— Joint Stock Company Achema, Jonava:

— Others:

R o m a n i a

— S.C. Amonil S.A., Slobozia

— Petrom S.A. Sucursala Doljchim
Craiova, Craiova

— Sofert S.A., Bacau

— Others:

U k r a i n e

— Cherkassy Azot, Cherkassy

— Dnipro Azot, Dniprodzerzhinsk

— Others:

48,8 %

48,8 %

10,0 %

10,0 %

20,1 %

40,7 %

25,2 %

40,7 %

21,1 %

66,3 %

82,1 %.

E. INJURY

1. Definition of the Community industry

(81)

Several interested parties repeated their claim that those
Community producers which purchased and imported
urea from countries covered by this proceeding, should
the Community
be excluded from the definition of
industry

(82) As outlined at recital 156 of the provisional Regulation,
these purchases were mainly small in volume and were
made to cover production shortfalls due to maintenance
works. The one company that did make more substan-
tial purchases, equal to approximately 20 % of its own
production in the IP, did so in order to supplement its
this
product
company is primarily a producer of urea, and not an
importer, and that there are thus no good reasons for it
to be excluded from the definition of the Community
industry.
In any case such exclusion would have no
significant impact on the findings of the case nor on the
level of duties imposed.

range. The investigation showed that

(83) Accordingly the findings in recital 157 of the provi-

sional Regulation are confirmed.

2. Community consumption

(84)

In the absence of any new information, the findings
concerning Community consumption as outlined at reci-
tals 158 and 159 of
the provisional Regulation are
confirmed.

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3. Imports from the countries concerned

Volume, market shares, and prices of the imports concerned

Cumulative assessment of the effects of the imports concerned

(90)

In the absence of any new information on the volume
and prices of imports from the countries concerned, the
provisional findings are confirmed.

(85)

It was claimed that
imports of urea originating in
Romania should not be cumulated with imports from
the other countries covered by this proceeding. The
claim was based on the grounds
the import
volumes and the market shares developed differently
over the period considered.

that

Undercutting

(86) At recital 162 of the provisional Regulation,

it was

determined that:

— imports

from all

substantial and well above the levels set out
Article 5(7) of the basic Regulation,

the countries concerned were
in

— the dumping margins found were all above the de
minimis level, and all exporting producers undercut
the sales prices of the Community industry,

— the prices of both imported and Community
the period

produced urea fell significantly over
considered.

(87)

The volume of urea imports from Romania followed the
trend for the price of urea on the Community market i.e.
there was a certain relationship between prices and the
volume of
the period
imports from Romania over
considered. In 1999 when prices were at their lowest,
there were almost no imports from Romania. This is
evidence of price transparency in the Community urea
market. It also shows that Romanian exporters will with-
draw from a market when prices fall too far. Neverthe-
less, with the partial recovery in prices between 1999
and the IP (recital 164 of the provisional Regulation),
Romanian imports increased substantially so that they
held 2,3 % of market share during the IP. Of the coun-
tries concerned, Romania was the fourth largest exporter
to the Community during the IP.

(88) Nor was this import trend specific to Romania. Imports
from several of the countries concerned also followed a
remarkably similar pattern of falling imports between
1996 and 1999 followed by a significant return to the
Community market during the IP. This is against a back-
ground of
import volumes from the countries
concerned rising year on year over the period consid-
ered. The only change was in the share of those imports
between the countries concerned in line with prices. This
is further evidence of competition between imported
products and is not a reason for de-cumulating the
imports from Romania, or indeed any of the other coun-
tries concerned.

total

(89)

For all of the reasons outlined above, it is concluded that
the criteria as set out in Article 3(4) of the basic Regula-
tion have been met. The findings at recital 162 of the
provisional Regulation are, therefore, confirmed.

(91)

For the provisional determinations, undercutting was
calculated by comparing the exporters' Community
frontier, ex quay, customs duty paid price level (DEQ)
with the Community producers' verified ex-works prices.
The comparison was made at a prilled to prilled, gran-
ular to granular, bulk to bulk, and bagged to bagged
level.

(92) A number of parties, including several of the exporting
producers, claimed that
the Community producers'
prices for the undercutting comparison should be the
weighted average price at the Community industry level
and not the price at the individual producer level. It is
claimed that such a methodology serves to artificially
inflate the margin by zeroing at
the Community
producer level.

(93)

(94)

(95)

It should first be noted that the undercutting or price
comparison exercise is an injury indicator which, under
Article 3(3) of the basic Regulation, aims to examine
‘whether there has been significant price undercutting by
the dumped imports as compared with the price of a
like product of the Community industry, or whether the
effect of such imports is otherwise to depress prices to a
significant degree’.

is true that not all

imports from the countries
It
concerned undercut
the prices of each Community
producer. However, a significant volume of export sales
were made at prices below those of the Community
industry.
the Community urea
market is both highly transparent and sensitive to price
changes.

is also noted that

It

the proportion of

Following further analysis it was found that, for the
countries concerned,
imports, by
the Community industry's
company, which undercut
prices, varied from 0 % to 56 %, with an overall average
for all imports of 46 %. The level of the undercutting
ranged as high as 17 %. For this analysis, no zeroing was
used. Due to problems with cooperation from the
exporting producer in Belarus (recital 113 of the provi-
sional Regulation) and Estonia (recital 58 of the provi-
sional Regulation), it was not possible to carry out this
price comparison for these companies. However, there
are no reasons to suggest that their results would have
been any different.

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(96)

(97)

it should be noted that the Community
Furthermore,
industry recorded losses during the IP (recital 175 of the
provisional Regulation), i.e. the prices of the Community
industry were depressed. Also for the one company with
no undercutting, underselling was still found.

It is, therefore, definitively determined that there was
both significant price undercutting by the exporting
producers in the countries concerned, as well as a
depression of prices on the Community market during
the IP.

(98) A number of claims were made concerning the injury
elimination calculations. These are addressed in detail in
recitals 114 to 116 and 121 to 123. However, where
adjustments were granted,
it is confirmed that these
were also taken into account for the undercutting exer-
cise.

4. Situation of the Community industry

(99)

Following further verification of two Community produ-
cers, some of the injury indicators changed in absolute
terms. However, these changes were not sufficient to
materially affect the trends of the injury indicators over
the period considered or to alter the provisional conclu-
sions. Based on the above, the provisional findings of
material injury suffered by the Community industry are
confirmed.

F. CAUSATION

(100) A number of interested parties re-iterated their claim
that the injury suffered by the Community industry was
not caused by dumped imports but rather by the over-
supply of urea on the world market. This is linked to the
claim made by some of
the injury
suffered by the Community industry was a result of their
fall in export sales, which in turn affected their sales on
the Community market.

the parties that

(101)

In this respect, it should be noted that the assessment of
the situation of the Community industry was based on
data relating to sales of the product concerned on the
Community market. Therefore, the potential negative
effects of reduced export sales are excluded in the above
injury analysis.

(102)

In addition, over the period considered, Community
industry export sales fell by 337,000 tonnes, whilst its
sales on the Community market increased by 172,000
tonnes. Therefore, faced with difficult export conditions,

the Community industry was able to divert half of its
lost export sales onto the Community market.

(103) At the same time, Community consumption increased
by 1,25 million tonnes,
low priced dumped imports
increased by 867,000 tonnes (recital 163 of the provi-
sional Regulation), and the Community industry lost
10,3 % of the Community market (recital 173 of the
provisional Regulation). Rather than being the cause, the
inability of the Community industry to take advantage
of an expanding domestic market when export sales fell,
is evidence of the existence of injury caused by the
dumped imports.

(104) Accordingly, oversupply and loss of export sales could
in fact only have had an effect on the Community
industry (in terms of a limited loss of economies of
scale) because the dumped imports prevented it from
taking full advantage of an expanding Community
market. Therefore, it is concluded that the effect of the
fall in export sales by the Community industry, and the
alleged oversupply, when they are examined separately,
was not sufficient to break the causal link between the
effect of the dumped imports and the material
injury
suffered by the Community industry. The conclusions of
recitals 197 and 198 of the provisional Regulation are
confirmed.

G. COMMUNITY INTEREST

1. Importers/traders

(105) Following publication of the provisional Regulation, no
comments were received from any of the cooperating
importers. However, one association of importers main-
tained that the imposition of anti-dumping measures
was against the interest of importers of urea and that for
them a flourishing agricultural sector is important.

(106) As stated at recital 206 of the provisional Regulation,
there will be a continuing need for imports. Even were
the duties to be passed on in full this would result in an
increase of no more than 0,6 % in farmers' costs at
worst. Whilst such a rise may result in some changes in
the way that
there is no
farmers source their urea,
evidence to call into question the conclusions set out in
recital 206 of the provisional Regulation.

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2. Users

H. DEFINITIVE ANTI-DUMPING MEASURES

Farmers

1. Injury elimination level

(107) Following publication of

the provisional Regulation,
comments were received from farmers' organisations in
Austria, Italy, Spain and the UK. None of these parties
challenged the provisional conclusion that the duties
would lead to a 0,6 %, worst case scenario, increase in
farmers' costs. They did however, object to the imposi-
tion of measures and to the conclusion that prise
increases would not be passed on in full.

(113) For the provisional determinations, underselling was
calculated by comparing the exporters' Community
frontier, ex quay, customs duty paid price level (DEQ)
with the Community producers' verified ex-works target
prices. The comparison was made by company on a
prilled to prilled, granular to granular, bulk to bulk, and
bagged to bagged level.

(108) Following a verification at the premises of a farmers'
cooperative, the conclusion of the cost implication of
the proposed measures is confirmed. That the impact of
the measures will not be passed on in full is based on
experience from many other anti-dumping proceedings.
There is no evidence to suggest that this would not be
case in this proceeding.

(114) Many exporting producers claimed that the adjustment
made for unloading costs to arrive at the DEQ price was
insufficient.
It was also claimed that an importers'
(mainly traders) margin should be included, in line with
other recent fertiliser cases.

(109) Whilst the difficult situation faced by farmers is re-
affirmed, it is not possible to conclude that the impact
of the duties would be such as to make the imposition
of measures against the interest of the Community.

(115) Further evidence of actual unloading costs incurred has
been obtained from several
including the
exporting producers, the Community industry, and inde-
pendent importers. On the basis of this information, the
allowance for unloading costs has been adjusted accord-
ingly.

sources,

Industrial users

(110) No written comments were received direct from any of
the cooperating industrial users of urea. This suggests
that the measures would not have such an important
impact on these users of urea.

(111) One industrial user, who also imports and sells urea,
submitted comments via an importers association. This
company suggests that the imposition of measures may
force it to close its plant with the loss of up to 380 jobs.
However, as this claim was not made directly by the
company, and as it is not supported by any evidence,
the claim is rejected.

3. Conclusion on Community interest

(116) The question of granting an adjustment for the impor-
ters' margin was considered on the merits of this partic-
ular investigation. It was found that exporting producers
sold urea on the Community market via a number of
channels, including directly to the end user. No evidence
was provided that prices varied according to the channel
used. Rather, it was found that in general, the selling
prices did not depend upon the type of the customer.
Nor were any significant differences found between the
sales channels used by the Community industry and
those used by the exporting producers. Accordingly the
request for an adjustment for an importers' margin was
rejected.

(117) A number of parties,

including the majority of

the
exporting producers, claimed that
the Community
producers' prices for the underselling calculation should
be the weighted average price at
the Community
the individual
industry level and not
producer level. It was claimed that such a methodology
served to artificially inflate the margin by eliminating
any negative underselling at the Community producer
level.
In addition it was claimed that basing anti-
dumping duties on a calculation methodology which
results in zeroing, contravenes a recent WTO ruling (1).

the price at

(112)

In the absence of any new information regarding the
Community interest aspects, the conclusions of recital
219 of the provisional Regulation, are confirmed.

(1) European Communities — Anti-Dumping Duties on Imports of
Cotton-Type Bed Linen from India — AB-2000-13 — Report of the
Appellate Body 1.3.2001.

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(118)

reality. The

investigation showed

It should be noted that the underselling calculation aims
to examine the actual extent of injury suffered by the
Community industry caused by dumped imports. To
show a true picture any price comparison should reflect
economic
that
takes place
competition on the Community market
between each individual exporting producer and each
individual producer which forms part of the Community
industry. In this respect it is noted, inter alia, that there
are significant price spreads and important differences in
the location of the Community producers. Thus, the
extent of any injurious dumping caused by an exporting
producer to the Community industry should be assessed
on the actual market situation and on the basis of
specific data verified for each company.

(119) Comparing prices company by company results in a
precise evaluation of the full
impact of any injurious
dumping suffered by the Community industry, and does
not artificially inflate the level of underselling in the
current case. Accordingly the claim is rejected.

(120) The Community industry claimed that some of the urea
imported into the Community was in fact a ‘fat’ prill,
which should be treated as a separate type of urea. It
was further claimed that, for the underselling calcula-
tion,
this type should be compared to the price of
Community produced ‘fat’ prill.

(121)

It was found that large diameter or ‘fat’ prills were
indeed produced by the Community industry as well as
being exported to the Community from some of the
countries concerned. However the only difference to
standard prills is in their larger diameter. Nor is there is
any evidence to suggest that the cost of production is
any higher or that ‘fat’ prills were sold at a premium
during the IP. Accordingly, it is concluded that there are
no reasons why ‘fat’ prills should be considered as a
separate product type.

(122) Some exporting producers repeated their claim for an
adjustment for quality of their product. However, no
supporting evidence was provided. Nor was any market
perception of quality problems with Romanian urea
found. The claim is therefore rejected.

(123)

It should be noted that for calculating the non-injurious
price at the provisional stage, a profit margin of 8 % on
cost was used and not 8 % on turnover as stated at
recital 222 of the provisional Regulation. Certain coop-
erating parties argued that the profit margin should be

limited to 5 %, as was the case in previous anti-dumping
proceedings concerning nitrate fertilisers as well as in
the proceeding concerning urea from Russia (1). For its
part, the Community industry re-stated its claim that a
profit margin of 15 % return on capital employed
(ROCE) would be more appropriate.

(124)

It is confirmed that the determination of the relevant
profit margin in this proceeding is based on an assess-
ment of the profit margin that the Community industry
could reasonably have counted upon under normal
conditions of competition,
in the absence of dumped
imports. It is therefore based on an assessment of the
facts in this case and not on the assessment of the facts
in other proceedings concerning other products and/or
other investigation periods.

(125) For the reasons stated at recital 223 of the provisional
the claim that profitability be based on

Regulation,
ROCE is rejected.

(126) Given the above, and in the absence of any evidence that
the determination of an 8 % profit margin is incorrect,
the conclusions of recitals 221 to 227 of the provisional
Regulation are confirmed.

(127) Finally, information received and data verified following
publication of the provisional Regulation, including veri-
fied information from two further Community produ-
cers, was also incorporated into the calculations, where
appropriate.

2. Level and form of the duties

(128)

In light of the foregoing, it is considered that, in accord-
ance with Article 9(4) of the Basic Regulation, definitive
anti-dumping duties should be imposed at the level of
the injury margins or dumping margins found, on
imports of urea originating in Belarus, Bulgaria, Croatia,
Estonia, Libya, Lithuania, Romania and the Ukraine,
whichever are the lower.

(129) As regards the residual duty to be applied to the non
cooperating exporting producers, the residual duty was
fixed on the basis of the highest duty rate established for
the cooperating exporters in each country.

(130) One exporting producer claimed that,

in order to be
consistent with a previous proceeding, the duties should
take the form of a minimum import price, as is the case
for urea from Russia.

(131) However, as stated at recital 231 of the provisional
Regulation, in order to ensure the efficiency of the meas-
ures and to discourage the price manipulation which has
been observed in some previous proceedings involving
the same general category of product,
fertilisers,
definitive duties should take the form of a specific
amount per tonne. The claim is, therefore, rejected.

i.e.

(1) Council Regulation (EC) No 901/2001 of 7 May 2001 imposing a
definitive anti-dumping duty on imports of urea originating in
Russia (OJ L 127, 9.5.2001, p. 11).

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(132) On the basis of the above, the definitive duty amounts are as follows:

Country

Company

Basis for AD duty
(%)

Definitive duty
(Euro per tonne)

Belarus

Bulgaria

Single country-wide margin

Chimco AD

Others

Croatia

Petrokemija d.d.

Others

Estonia

JSC Nitrofert

Others

Libya

National Oil Corporation

Others

Lithuania

Joint Stock Company Achema

Others

Romania

S.C. Amonil S.A., Slobozia

Petrom S.A. Sucursala Doljchim Craiova,
Craiova

Sofert S.A., Bacau

Others

Ukraine

Open Joint Stock Company Cherkassy Azot,
Cherkassy

Joint Stock Company DniproAzot, Dniprodzer-
zinsk

Others

8,0

24,2

24,2

9,4

9,4

11,4

11,4

12,5

12,5

10,0

10,0

6,7

5,7

7,6

7,6

18,7

9,2

19,5

7,81

21,43

21,43

9,01

9,01

11,45

11,45

11,55

11,55

10,05

10,05

7,20

6,18

8,01

8,01

16,27

8,85

16,84

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

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

(1) Commission of the European Communities

Directorate-General Trade
TERV 00/13
Rue de la Loi/Wetstraat 200
B-1049 Brussels.

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3. Collection of provisional duties

(135)

In view of the magnitude of the dumping margins found and in the light of the injury caused to the
Community industry, it is considered necessary that the amounts secured by way of the provisional
anti-dumping duty, imposed by the provisional Regulation, should be definitively collected at the
rate of the duty definitively imposed. Where the definitive duties are higher than the provisional
duties, only the amounts secured at the level of the provisional duties should be definitively
collected.

4. Undertakings

(136) Subsequent to the imposition of provisional measures, exporting producers in Belarus, Croatia,
Libya, Romania and the Ukraine offered price undertakings in accordance with Article 8(1) of the
Basic Regulation. The exporting producers in Estonia and Lithuania renewed their undertaking offers,
already made at provisional stage, but which had been rejected for the reasons set out in recital 236
and 237 of the provisional Regulation.

(137)

It is recalled that the Commission had already accepted an undertaking from the Bulgarian exporting
producer at the provisional stage of this proceeding (see recital 236 of the provisional Regulation).
the incorporation of new data in the definitive injury margin
As mentioned in recital 128,
calculation had an impact on the injury elimination level
found. The minimum price of the
undertaking was therefore adapted accordingly.

(138) Subsequent to the disclosure of the provisional findings, the complainant Community industry
objected to the Commission's decision to accept an undertaking from the Bulgarian exporting
producer. In this respect, it was argued that the company concerned was related — or had close
technical and industrial relations — to other exporters and/or producers of nitrogen fertilisers
including urea,
located in Bulgaria, Belarus and the Ukraine which would constitute a strong
potential for compensatory arrangements. Furthermore, the Community industry raised concerns
regarding the ability of this exporting producer to fulfil the obligations of an undertaking.

(139) On a more general basis, the Community industry claimed that undertakings, and thus minimum

prices, would be an inappropriate measure with regard to nitrogen fertilisers including urea.

(140)

It should be noted that the Community industry could not support the allegations made with regard
to the exporting producer in Bulgaria by sufficient evidence. Furthermore, the investigation of the
Commission did not confirm these allegations and they had therefore to be rejected. As far as the
appropriateness of the undertaking is concerned it should be noted that such assessment should
primarily focus on the company specific situation. Thus, it was found that the company concerned
produces and exports only urea and that an effective monitoring of the undertaking is most likely in
this case.

(141)

the undertaking an
In any case,
anti-dumping duty may be imposed, pursuant to Article 8(9) and (10) of the Basic Regulation.

in the event of suspected breach, breach or withdrawal of

(142) All other undertaking offers received were also analysed in detail. Two main obstacles to the

acceptability of these undertaking offers resulted from this examination:

(143) The exporting producers concerned in Lithuania, Romania, Croatia, Ukraine and Libya are producers
of different types of fertilisers and/or other chemical products and have consistently in the past
exported these products to common customers (mostly traders) in the Community. This practice
raises a serious risk of cross-compensation i.e. that any undertaking prices would be formally
respected but that prices for products not concerned would be lowered. All this would render the
commitment to respect a minimum price for urea easy to circumvent and extremely difficult to
monitor effectively.

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Official Journal of the European Communities

L 17/15

(144) Furthermore, certain producers (vg: Estonia, Ukraine, Belarus) claimed that they had no control over,
or even knowledge of the destination and/or sales conditions of their exports of urea, while it was
clear from official statistics that the product was exported to the Community in large quantities
during the investigation period. It is recalled that given that these companies did not provide
sufficient information in this respect, the Commission had no option but to make use of facts
available in accordance with Article 18 of the Basic Regulation to establish export prices. In addition,
certain exporters (Libya, Estonia) provided overall a deficient level of cooperation during the
investigation. It was considered that these facts render the risk of accepting an undertaking unreason-
ably high and the guarantees to assure a proper monitoring unsatisfactory.

(145) For the reasons set out above, it was therefore concluded that none of the undertakings offered

subsequent to the disclosure of the definitive findings should be accepted.

(146) The interested parties were informed accordingly and the reasons why the undertaking offered could
not be accepted disclosed in detail to the exporters concerned. The Advisory Committee has been
consulted,

HAS ADOPTED THIS REGULATION:

Article 1

A definitive anti-dumping duty is hereby imposed on imports of urea, whether or not in aqueous
1.
solution, falling within CN codes 3102 10 10 and 3102 10 90 originating in Belarus, Bulgaria, Croatia,
Estonia, Libya, Lithuania, Romania and the Ukraine.

The rate of the definitive anti-dumping duty, applicable, before duty, to the net, free-at-Community

2.
frontier price of the product described in paragraph 1 above, shall be as follows:

Country of origin

Produced by

Definitive anti-
dumping duty
(euro per ton)

TARIC additional
code

Belarus

All companies

Bulgaria

All companies

Croatia

Estonia

Libya

All companies

All companies

All companies

Lithuania

All companies

Romania

S.C. Amonil SA, Slobozia

Petrom SA Sucursala Doljchim Craiova, Craiova

Sofert SA, Bacau

All other companies

7,81

21,43

9,01

11,45

11,55

10,05

7,20

6,18

8,01

8,01

Ukraine

Open Joint Stock Company Cherkassy Azot, Cherkassy

16,27

Joint Stock Company DniproAzot, Dniprodzerzinsk

All other companies

8,85

16,84

—

A999

—

—

—

—

A264

A265

A266

A999

A268

A269

A999

L 17/16

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Official Journal of the European Communities

19.1.2002

In cases where goods have been damaged before entry into free circulation and, therefore, the price
3.
actually paid or payable is apportioned for the determination of the customs value pursuant to Article 145
of Commission Regulation (EEC) No 2454/93 of 22 July 1993 laying down provisions for the implementa-
tion of Council Regulation (EEC) No 2913/92 establishing the Community Customs Code (1) the amount of
anti-dumping duty, calculated on the basis of paragraph 2 above, shall be reduced by a percentage which
corresponds to the apportioning of the price actually paid or payable.

4.

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

Article 2

1.
Imports shall be exempt from the anti-dumping duties imposed by Article 1 provided that they are
produced and directly exported (i.e. shipped and invoiced) to the first independent customer in the
Community acting as an importer by the company named below which has offered undertakings accepted
by the Commission, when such imports are in conformity with paragraph 2.

Country

Company

Bulgaria

Chimco AD, Shose az Mezdra, 3037 Vratza

TARIC additional
code

A272

2.

(a) When the declaration for release for free circulation pursuant to an undertaking is presented,
exemption from the duty shall be conditional upon presentation of a valid commercial invoice,
issued by the company listed in paragraph 1, to the Member States customs authorities.

(b) The undertaking invoice shall conform with the requirements for such invoices set out in the
undertaking accepted by the Commission, the essential elements of which are listed in the Annex.

(c) Exemption from the duty shall further be conditional on the goods presented to customs corre-

sponding precisely to the description on the commercial

invoice.

Imports accompanied by such an undertaking invoice shall be declared under the TARIC additional

3.
code provided in paragraph 1.

Article 3

The amounts secured by way of the provisional anti- dumping duty imposed pursuant to Regulation (EC)
No 1497/2001 shall be definitively collected at the rate of the duties definitively imposed on imports of
urea, whether or not in aqueous solution, falling within CN codes 3102 10 10 and 3102 10 90 originating
in Belarus, Bulgaria, Croatia, Estonia, Libya, Lithuania, Romania and the Ukraine.

The amounts secured in excess of the definitive rate of anti-dumping duties shall be released.

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

Article 4

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

Done at Brussels, 17 January 2002.

For the Council

The President

J. PIQUÉ I CAMPS

(1) OJ L 253, 11.10.1993, p. 1. Regulation as last amended by Commission Regulation (EC) No 993/2001 (OJ L 141,

28.5.2001, p. 1).

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Official Journal of the European Communities

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ANNEX

The following elements shall be indicated in the commercial invoice accompanying the Company's sales of urea to the
Community which are subject to the Undertaking:

1. The heading ‘COMMERCIAL INVOICE ACCOMPANYING GOODS SUBJECT TO AN UNDERTAKING’

2. The name of the company mentioned in Article 2(1) 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

including:

6. The exact description of the goods,
— the Product Code Number (PCN)
— the description of the goods corresponding to the PCN (i.e.
— the company product code number (CPC) (if applicable)
— CN-code
— quantity (to be given in tonnes)

7. The description of the terms of sale,

including:

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

‘PCN 1 urea in bulk’,

‘PCN 2 urea, bagged’)

8. Name of the company 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 undertaking invoice and the following signed declaration:

‘I, the undersigned, certify that the sale for direct export by [company name] 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 [company
name], and accepted by the Commission of the European Communities through [Regulation (EC) No 1497/2001]. I
declare that the information provided in this invoice is complete and correct.’