Council Regulation (EC) No 769/2002 of 7 May 2002 imposing a definitive anti-dumping duty on imports of coumarin originating in the People's Republic of China
Date: 2002-05-07
Institutions: Council of the European Union
Subjects: China, anti-dumping duty, anti-dumping legislation, chemical compound, dumping, import, originating product

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Official Journal of the European Communities

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I

(Acts whose publication is obligatory)

COUNCIL REGULATION (EC) No 769/2002

of 7 May 2002

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

THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty establishing the European
Community,

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

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

Whereas:

(1)

(2)

(3)

A. PREVIOUS PROCEDURE AND EXISTING MEASURES

In March 1996, by Regulation No 600/96 (2) definitive
anti-dumping measures were adopted with regard to
imports of coumarin originating in the People's Republic
of China. The measures imposed were in the form of a
specific duty of ECU 3 479 per tonne.

B. PRESENT INVESTIGATION

1. Request for review

impending
Following the publication of a notice of
expiry (3) of
the anti-dumping measures in force on
imports of coumarin originating in the People's Republic
of China (‘country concerned’ or ‘the PRC’), the Commis-
sion has received a request for review pursuant to Article
11(2) of Regulation (EC) No 384/96 (‘the basic Regula-
tion’).

The request was lodged on 4 January 2001 by the
European Chemical Industry Council (CEFIC) (‘the appli-
cant’) on behalf of the sole producer in the Community
representing the totality of the Community production
of coumarin.

(1) OJ L 56, 6.3.1996, p. 1. Regulation as last amended by Council
Regulation (EC) No 2238/2000, OJ L 257, 11.10.2000, p. 2.

(2) OJ L 86, 4.4.1996, p. 1.
(3) OJ C 271, 22.9.2000, p. 3.

(4)

(5)

(6)

(7)

(8)

The request for an expiry review was based on the
grounds that injurious dumping of imports originating
in the PRC would be likely to continue or to recur if
measures were allowed to expire.

2. Notice of initiation

Having determined, after consultation of the Advisory
Committee, that sufficient evidence existed for the initia-
tion of an expiry review, the Commission initiated an
the basic
investigation pursuant
Regulation by a notice published in the Official Journal of
the European Communities (4).

to Article 11(2) of

3. Period of investigation

The investigation period (‘IP’) for the examination of
recurrence of dumping and injury
continuation or
covered the period from 1 January 2000 to 31
December 2000. The examination of trends relevant for
the assessment of continuation or recurrence of injury
covered the period from 1 January 1996 up to the end
of the IP (‘period under review’).

4. Parties concerned by the investigation

the

advised

The Commission officially
applicant
Community producer, the exporting producers in the
PRC and their representatives, the Chinese authorities
and the importers, users and associations known to be
concerned, of the initiation of the review. The Commis-
sion sent questionnaires
to exporting producers, a
producer in the United States (analogue country), the
sole Community producer, importers, users and associa-
tions known to be concerned and to those parties who
made themselves known within the time limit set in the
notice of initiation of the review.

country
The Community producer,
producer, one importers' association, and five users
replied to the questionnaires. With respect to the PRC
no reply to the questionnaire was received.

analogue

the

(4) OJ C 104, 4.4.2001, p. 5.

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5. Verification of information received

D. LIKELIHOOD OF A CONTINUATION OF DUMPING

OR RECURRENCE OF DUMPING

(9)

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

(10)

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

Community producer:

— Rhodia, (Lyon) France;

Importers:

— Quest International, (Ashford) United Kingdom;

Analogue country producer:

— Rhodia, (Cranbury NJ) USA.

C. PRODUCT CONCERNED AND LIKE PRODUCT

1. Product concerned

(11)

(12)

The product concerned is the same as in the original
investigation, i.e. coumarin, a whitish crystalline powder
with the characteristic odour of newly mown hay. Its
main uses are as an aroma chemical and as a fixative in
the
such
compounds being used in the production of detergents,
cosmetics and fine fragrances.

compounds,

preparation

fragrance

of

Coumarin, which was originally a natural product
obtained from tonka beans, is now produced syntheti-
cally. It can be obtained by a synthesis process starting
from phenol to obtain salicilaldehyde (Perkin reaction)
or by a synthesis from orthocresol (Raschig reaction).
The main physical specification of coumarin is its purity,
of which the melting point is the indicator. The standard
quality coumarin marketed in the Community has a
melting point varying between 68 °C and 70 °C which
corresponds to 99 % purity.

(13)

product

The
ex 2932 21 00.

concerned

falls within CN code

2. Like product

(14) As in the original investigation, coumarin produced and
sold on the domestic market in the analogue country
(USA) and that exported to the Community from the
PRC as well as coumarin produced and sold by the
Community industry in the Community market were
found to have effectively identical physical characteris-
tics and uses and are thus like products within the
meaning of Article 1(4) of the basic Regulation.

(15)

(16)

(17)

(18)

(19)

In accordance with Article 11(2) of the basic Regulation,
it is necessary to examine whether the expiry of the
measures would be likely to lead to a continuation of
dumping.

In examining whether there is a likelihood of a contin-
uation of dumping,
it is necessary to verify whether
dumping exists at present and whether any such
dumping is likely to continue.

1. Preliminary remarks

The findings on dumping set out below should be
viewed in the light of the fact that the Chinese exporting
producers did not cooperate in the investigation and
findings therefore had to be based on facts available, i.e.
Eurostat data, Chinese export trade data and information
contained in the complaint.

2. Current level of dumping

(a) A n a l o g u e c o u n t r y

The existing measures provide for a single country-wide
duty on all imports into the Community of coumarin
from the PRC. In accordance with Article 11(9) of the
basic Regulation, the Commission employed the same
methodology as in the original
investigation. Accord-
ingly, normal value was determined on the basis of
information obtained in a market economy third
country (the ‘analogue country’).

The United States had served as an analogue country in
the original investigation. In the notice of initiation of
this expiry review it was therefore envisaged to again
choose the United States as analogue country for the
purpose of establishing normal value. Since it was also
found that the original reasons for selecting the USA, i.e.
the size of its domestic market, the openness of its
market and its degree of access to basic materials, were
still valid, the United States was considered to be an
appropriate and not unreasonable choice of analogue
country. Only one interested party objected to this
choice of analogue country, in particular with regard to
the difference in manufacturing the product, however
they did not submit any alternative choice in due time.
Therefore, since the United States producer which was
contacted agreed to cooperate fully, and had sufficient
representative domestic sales, the United States were, in
accordance with Article 2(7) of the basic Regulation,
considered to be an appropriate and not unreasonable
choice of analogue country for establishing normal value
in respect of the PRC for the product concerned.

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(b) N o r m a l v a l u e

(26)

(20)

It was subsequently examined whether the domestic
sales of the cooperating United States producer to inde-
pendent customers could be considered to have been
made in the ordinary course of trade, in accordance with
Article 2(4) of the basic Regulation. It was found that
the weighted average selling price of all sales during the
investigation period was above the weighted average
unit cost of production, and that the volume of indi-
vidual sales transactions below unit cost of production
was more than 20 % but less that 90 % of the sales
being used to determine normal value; therefore only all
the profitable domestic sales were regarded as having
been made in the ordinary course of trade, and used for
comparison. Normal value was therefore determined, as
set out in Article 2(1) of the basic Regulation, on the
basis of the price paid or payable, in the ordinary course
the
trade, by independent domestic customers of
of
cooperating United States producer during the invest-
igation period.

(c) E x p o r t p r i c e

(21) As regards the exports to the Community, for which
there was no cooperation from the Chinese exporting
producers, findings had to be based on the facts avail-
able, in accordance with Article 18(1) of the basic Regu-
lation. An average export price for all transactions was
thus determined on the basis of Chinese export trade
data.

(d) C o m p a r i s o n

(22)

For the purpose of a fair comparison, and in accordance
with Article 2(10) of the basic Regulation, due allowance
in the form of adjustments was made for differences in
respect of inland freight, handling and loading, transport
and credit costs, which affected prices and price compar-
ability.

(23)

Concerning inland transport, the relevant adjustments
were based on the analogue country's costs.

The investigation did not reveal any reason why this
dumping would disappear if the measures were to be
repealed. It was therefore concluded that there is a likeli-
hood of continuation of dumping. However, given the
low level of imports originating in the PRC during the
it was considered appropriate to examine whether
IP,
there were a recurrence of dumping in increasing export
volume should exhausting measures be repealed.

3. Development of imports from the PRC

(27)

For the examination of a likelihood of recurrence of
dumping the following factors were examined: existence
of dumping, the evolution of production and capacity
utilisation in the PRC, and the evolution of worldwide
Chinese coumarin exports.

(a) E x i s t e n c e o f d u m p i n g

(28)

The dumping margin established in the initial
invest-
igation was high (more than 50 %, leading to a duty of
ECU 3 479 per tonne). The investigation carried out
under the present review indicates that dumping still
persisted and was close to the level found in the initial
investigation.

(b) E v o l u t i o n

o f

p r o d u c t i o n

a n d

c a p a c i t y

u t i l i s a t i o n i n t h e P R C

(29) According to the information available, production
capacity in the PRC is high, and could be even increased
in a very short time due to the nature of the product and
the production process. The information shows that the
Chinese production capacity is about 1 900 tonnes
(representing 40 % of
the world wide capacity with
seven producers, and 18 potential producers ready to
re-enter in the markets. This is much larger than the
entire EC consumption of 700 tonnes.

(30)

Consequently,
the enormous availability of unused
production capacity (between 50 % and 60 % of produc-
tion capacity) gives Chinese exporting producers a very
flexibility in the production process.
high degree of
These producers are therefore able to quickly increase
production and direct it to any export market, including,
were the measures to be repealed,
the Community
market.

(e) D u m p i n g m a r g i n

(24)

(25)

In accordance with Article 2(11) of the basic Regulation,
the weighted average normal value, on an ex-works
basis, was compared to the weighted average export
price on an ex-works Chinese basis, at the same level of
trade.

The above comparison showed the existence of very
significant dumping. The dumping margin found was
substantial and just below the level found in the original
investigation (around 50 %).

(c) E v o l u t i o n o f C h i n e s e

e x p o r t s

t o

t h i r d

c o u n t r i e s

1. General trend of exports

(31) On the basis of Chinese export statistics, Chinese price
behaviour on their other export markets shows that
Chinese exporters' prices
in those markets are on
average 11 % lower than the prices offered in the
Community, and even 16 % in certain third country
markets, such as Hong Kong and India.

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2. Possible deflection of Chinese exports due to the intro-

duction of restrictions in third countries

within the meaning of Article 4(1) and Article 5(4) of
the basic Regulation.

(32)

(33)

The USA imposed anti-dumping duties on import of
coumarin from the PRC in 1995 and maintained the
duties in May 2000 pursuant to an expiry review. The
USA duties range from 31,02 % to 160,80 %.

This shows that there is pressure on Chinese exporting
producers to find alternative export markets. Should the
Community repeal the current anti-dumping measures,
exports to the Community market would be an attrac-
tive option for Chinese exporting producers.

3. Chinese exports to representative export markets

(34)

It is important to note that, after the Council imposed
anti-dumping duties in 1995, exporting producers in the
PRC were not able to penetrate other export markets or
to expand the exports in the other existing markets.

(d) C o n c l u s i o n

(35)

(36)

(37)

(38)

investigation has

the quantities
The
imported into the Community from the PRC during the
investigation period were dumped.

shown that

levels if

The investigation has also shown that the volume of
Chinese coumarin exports to the Community would in
all probability reach substantial
the current
measures were to be repealed. This conclusion was
arrived at in view of the substantial spare capacity avail-
able in the PRC, and in view of the pressure on Chinese
exporting producers to find alternative export markets
to the USA and to other export markets. All this illus-
trates the strong continued interest of Chinese exporting
producers in selling to the Community.

It was also concluded that such substantially increased
exports to the Community would most likely be made at
dumped prices. This is demonstrated by the low prices
found for Chinese exports to other main third country
markets.

In summary,
it is most probable that imports to the
Community from the PRC will resume in significant
quantities and at significantly dumped prices, should
measures be repealed.

E. DEFINITION OF THE COMMUNITY INDUSTRY

(39)

The company represented by the applicant was the only
producer of coumarin in the Community during the
investigation period.

(40) During the IP,

concerned

the product

the Community producer

imported
coumarin from a country other than the PRC. The
purpose of such imports was to compensate shortages
of
from the producer's
Community production due to technical reasons. These
imports represented a minor part of
the total sales
in the Community. Thus,
volume by the producer
despite these sales of imported coumarin, the primary
activity of the company remained in the Community
and the import of this producer did not affect its status
as Community producer. This Community producer is
therefore deemed to constitute the Community industry

F. ANALYSIS OF THE SITUATION IN THE COMMUNITY

MARKET

1. Community consumption (1)

(41)

Community consumption was established on the basis
of the sales volumes of the Community industry on the
Community market as reported in the questionnaire
reply, the import volumes into the Community from the
country concerned and all other third countries, on the
basis of Eurostat.

large volumes of

(42) On this basis, the apparent consumption of coumarin
increased by 92 % during the period under review. The
most significant increase took place between 1996 and
1997, i.e. + 82 %. However, this should be seen in the
light of
coumarin which were
imported, mainly from the PRC, in 1994 and 1995, i.e.
before the imposition of the anti-dumping measures.
These large imported volumes have been stocked and
then sold/used in 1996 thus reducing artificially the
demand for coumarin this year and consequently the
apparent consumption. In 1997, total import volumes
went back to a level comparable with the one in 1993.

2. Imports from the country concerned

(a) V o l u m e a n d m a r k e t s h a r e

in particular between 1996 and 1998,

(43) With respect to the volume of the Chinese imports, it
drastically decreased over the period under review, i.e.
– 89 %,
i.e.
– 87 %. This coincided with the imposition of the anti-
dumping measures and the emergence of other countries
that increased their exports to the Community. In this
respect, it would appear that certain imports from Japan
were in fact of Chinese origin thereby circumventing the
measures. This can be noticed in particular as from
1997 when imports from Japan suddenly surged. After-
wards, given that the USA took action to prevent such
circumvention activities on the US market, the Japanese
exporter concerned also ceased its exports to the EC and
imports from Japan as reported by Eurostat on the
Community market have steadily decreased until the end
of the IP.

(1) For

confidentiality reasons, given that one

single Community
producer constitutes the Community industry, the figures contained
in this Regulation will be indexed or only given approximately.

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(44)

The market share of the imports from the PRC decreased
by 25 percentage points during the period under review
and were to be found between 1,5 and 3 %.

(b) P r i c e s

(45) After the imposition of

the measures in 1995,

the
average cif prices of the imports concerned, as reported
by Eurostat, increased by 23 %, between 1996 and the
IP, but remained below the average cif prices of all other
imports during the period under review, and also below
the Community industry's prices.

3. Economic situation of the Community industry

(a) P r o d u c t i o n

(46)

The Community industry's production doubled between
1996 and the IP. A significant
increase took place
between 1996 and 1997. Subsequently, production
slightly decreased until 1999 and went up again
between 1999 and the IP.

(47)

(48)

(49)

(b) C a p a c i t y a n d c a p a c i t y u t i l i s a t i o n

total production capacity of

the Community
The
industry increased by 29 % over
the period under
review. The increase is due to an upgrade of the existing
installation made in 1999.

Capacity utilisation increased by 56 % between 1996
and the IP. The increase was particularly marked
between 1996 and 1997 as well as between 1999 and
the IP.

(c) S a l e s i n t h e C o m m u n i t y

The sales volume of the Community industry signifi-
It
cantly increased during the period under review.
trebled between 1996 and the IP. This development was
made possible at a time when production doubled,
because exports decreased in the same time. The sales
increase was most remarkable between 1996 and 1997
even though the sales steadily increased between 1997
and the IP. However, as already explained under recital
42, the demand on the Community market was particu-
larly low in 1996,
thus distorting the comparison.
Taking 1997 as a basis of comparison, the increase of
the sales volume of the Community industry between
1997 and the IP is 41 %. Several reasons explain this
evolution, such as the imposition of the anti-dumping
measures in 1995 and the decrease of imports from
certain third countries as already mentioned in recital
43.

(d) S t o c k s

(50)

The Community industry's end of year stocks decreased
by 8 % during the period under review. They firstly
increased between 1996 and 1997, and then decreased
until 1999 before raising again between 1999 and the
IP.

(e) M a r k e t s h a r e

(51)

The market share of the Community industry rose by 27
percentage points during the period under review. This
increase was especially marked between 1996 and 1998
when market share gained 20 percentage points. After-
wards, market share slightly decreased in 1999 and
regained around 12 percentage points between 1999
and the IP.

(f) P r i c e s

(52)

(53)

sales price
The Community producer's average net
decreased by 14 % between 1996 and the IP. The fall
was particularly marked between 1996 and 1997 and
then between the 1999 and the IP.

This can be explained partly by the price level of the
Chinese products which, as already mentioned under
recital 45, remained below the average cif prices of all
other imports during the period under review. Even
though the import volume remained relatively low
during the IP, the investigation has shown that price
offers by the Chinese exporters have continued to be
made at low prices. In addition, the price pressure of
imports from Japan cannot be considered negligible
during the period under review, even if volumes have
decreased since 1997. However, this evolution should
also be seen in the light of the efforts made by the
Community producer to improve the efficiency of the
the production
production process. The increase of
capacity, coupled with the effect of the anti-dumping
measures, permitted the Community producer
to
increase the volume sold and thus to reduce the unit
cost of goods sold.

(g) P r o f i t a b i l i t y

(54)

The weighted average profitability of the Community
industry markedly improved during the period under
review since it passed from a significant loss in 1996 to
a profit which ranged between 5 % and 10 % in the IP.
This increase, which was particularly marked between
1998 and the IP, should be seen in the light of the
upgrade of the capacity already mentioned under recital
47, which permitted the Community industry to signifi-
cantly reduce its costs of production.

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(h) C a s h f l o w a n d a b i l i t y t o r a i s e c a p i t a l

4. Conclusion

The development of the cash flow generated by the
Community industry in relation to sales of coumarin is
very similar to that of the profitability since it passed
from a negative to a positive figure as from 1999.

(62)

(55)

(56)

(57)

(58)

(59)

investigation established that

The
the Community
industry was not experiencing difficulties in its ability to
raise capital. However, this is not considered as a mean-
ingful indicator given that the Community industry is a
large group whose coumarin production represents a
relatively small part of the total production, and that the
ability to raise
closely linked to the
is
performance of the whole group.

capital

(i) E m p l o y m e n t , p r o d u c t i v i t y a n d w a g e s

industry

Employment of
slightly
the Community
increased during the period under review and gained 9 %
between 1996 and the IP. The productivity of
the
Community industry's workforce, measured as produc-
tion volume per person employed, markedly increased
during the same period, improving by more than 80 %.
The wages as a whole increased by 27 % between 1996
and the IP, thus leading to an increase of the average
wage per employee by 16 % between 1996 and the IP.

(j) I n v e s t m e n t a n d r e t u r n o n i n v e s t m e n t

The level of investments significantly increased between
1996 and 1999 and went down again in the IP. The
investigation showed that most of this capital expendi-
ture was related to the upgrade of the capacity already
mentioned under recital 47, as well as to the mainte-
nance of the equipment.

The return on investment, expressed as the relation
between the net profits of the Community industry and
the net book value of its investments, followed very
closely the profitability trend since it turned out to be
positive as from 1999 and gained 23 percentage points
between 1996 and the IP.

(k) G r o w t h

(60) As mentioned above, while Community consumption
almost doubled during the period under review, the sales
volume and the market
the Community
industry followed an even more marked trend. The
Community industry could therefore fully benefit from
the growth of the market.

share of

The imposition of
the anti-dumping measures on
imports of coumarin originating from the PRC had a
positive impact on the Community industry, which
could recover from its weakened economic situation. All
injury indicators except sales prices developed positively.
However, this trend should also be seen in the light of
the efforts made by the Community industry in order to
improve its efficiency and to reduce its cost of produc-
tion. Finally, it should be noted that such improvement
only permitted the Community industry to get back to
the situation prevailing just before the dumping practice
started.

G. LIKELIHOOD OF RECURRENCE OF INJURY

1. Likelihood of recurrence of injury

(63) With regard to the likely effect on the Community
industry of the expiry of the measures in force, the
following factors were considered,
in line with the
elements summarised in recitals 35 to 38.

(64)

There are clear indications that imports originating in
the PRC will continue at dumped prices. Moreover, there
is a likelihood that
import volumes would increase
significantly given that the Chinese exporting producers
have the potential to raise their production and export
volume in view of
large unused production
capacity. In addition, even though the world coumarin
consumption is forecast to slightly increase in the next
three years, it is unlikely to absorb the unused Chinese
capacity.

their

(65) Having regard to the Chinese exporters' export price
behaviour on third country markets which are around
10 % lower than on the Community market, namely
Hong Kong, India, Japan and Singapore, it is likely that
the Chinese exporting producers will adopt an aggressive
price behaviour in the Community in order to regain
their lost market shares. Indeed, these low prices on
third countries markets show that Chinese exporters
consider it to be in their interest to sell at such prices.
This in turn would lead to a recurrence of injury in
the Community
terms of decreasing sales prices of
industry and decreasing sales volumes as well as the
consequent negative impact on profitability.

(l) M a g n i t u d e o f

t h e d u m p i n g m a r g i n

(66)

(61) As concerns the impact on the Community industry of
the magnitude of the dumping margin found (see recital
28), given the low volume of imports during the IP, this
cannot have an impact.

The Community market is also likely to be attractive for
the Chinese exporters. On the one hand, it is recalled
that
the
the Community market absorbed 46 % of
Chinese exports in 1995, i.e. before the imposition of
the measures currently in force, compared to 10 % in
1999.

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(67) On the other hand, the comparison between the total
Chinese exports on the world market, and the Chinese
exports on the Community market during the same
period, shows that Chinese exporters did not manage to
find new markets that would be likely to replace their
the
sales in the EC.
Chinese exports to the Community market between
1995 and 1999 (363 tonnes) was only compensated by
an increase of Chinese exports to other third countries
of around 100 tonnes.

the strong decrease of

Indeed,

(68)

In addition, as the Community market and the US
market stand for around 50 % of the world consump-
tion of coumarin and given that the USA have imposed
anti-dumping measures on imports of coumarin from
the PRC, it is very likely that, should the measures be
repealed, the Community market would be attractive for
exporters from the PRC.

(69) One importers' association argued that the existence of
capacity in the PRC does not imply in itself likely recur-
rence of injury.

(70)

In relation to this particular point, it is recalled that this
investigation should evaluate the likelihood of recur-
rence of dumping and injury in case the measures are
removed. Even if
large production
the existence of
capacity in the PRC does not in itself mean that injur-
ious dumping will recur, this is nevertheless a mean-
ingful indicator that should be taken into consideration.
This indicator, when combined with the analysis of the
Chinese exporters' behaviour on other third markets and
the ongoing dumping found, constitutes an indicator of
the likely behaviour of the exporters in case the meas-
ures are repealed and thus the likely effect thereof.

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

H. COMMUNITY INTEREST

1. Introduction

(72) According to Article 21 of the basic Regulation, the
Commission examined whether a prolongation of the
existing anti-dumping measures would be against the
interest of
the Community as a whole. The deter-
mination of the Community interest was based on an
appreciation of all the various interests involved,
i.e.
those of the Community industry, the importers/traders
as well as the users of the product under consideration.
In order to assess the likely impact of maintaining or not
maintaining the measures, the Commission requested
information from all interested parties mentioned above.

(73)

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

investigation is a review,

the present

that

have already been in place, would allow the assessment
of any undue negative impact on the parties concerned
by the current anti-dumping measures.

(74) On this basis it was examined whether, despite the
conclusions on the likelihood of a recurrence of injur-
ious dumping, compelling reasons existed which would
lead to the conclusion that it is not in the Community
interest to maintain measures in this particular case.

2. Interest of the Community industry

(75)

It is considered that, should the anti-dumping measures
imposed in the previous investigation be repealed, injur-
ious dumping is likely to recur and that the situation of
the Community industry, which improved during the
period under review, would deteriorate.

(76)

(77)

(78)

3. Interest of importers

From the 26 questionnaires sent, only one reply was
received by the Commission services from an importers'
association.

This association argued that the anti-dumping measures
led to the exclusion of both the Chinese and other third
country's producers from the Community market, thus
leading to a dependence of
the users on the sole
Community producer.

share lost by one of

First of all, it should be recalled that the coumarin world
market is very concentrated with only a few producers
the most important of whom, in terms of capacity, are
located in China and in the Community. Therefore, any
market
these two countries
producer is likely to be regained by the other. However,
it is recalled that the purpose of the anti-dumping meas-
ures is not to restrict supply, but to re-establish fair
competition on the Community market and that
coumarin originating in the PRC can still be imported in
the Community market. In addition, it should be noted
imports of
that, during the IP, around 25 % of all
coumarin was imported from countries other
than
China, notably from Japan and India, thus showing that
alternative sources of supply continue to exist. Further-
more, in view of the low level of cooperation and the
fact that importers generally deal with a wide range of
chemical products, of which coumarin is only one, it
was concluded that any possible negative impact of the
continuation of measures on importers would not be a
compelling reason not to impose the continuation of
measures.

4. Interest of users

(79) Questionnaires and/or information were received from
five users (out of the 23 questionnaires sent).

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Official Journal of the European Communities

9.5.2002

(80) One of

these companies is clearly in favour of

the
continuation of the measures while another does not
expect any change for its business should the measures
be removed or maintained. This latter company also
underlined the fact that it would not be in the industry's
interest that the Community producer stops production
in case of recurrence of dumped imports.

5. Competition aspects

(85)

Several interested parties argued that the current meas-
ures have led to the elimination of Chinese coumarin on
the Community market, leading to a monopoly position
of the Community industry. The prolongation of the
measures would thus be against
the
Community.

the interest of

(81)

Two users, of which only one imported the product
concerned from the country concerned during the
period under review, were against the continuation of
the measures, but both stated in their responses to the
questionnaire that they both do not expect any effect on
their business, should the measures be removed or main-
tained.

(86) As already mentioned under recital 51, the Community
industry increased its market share and thus can benefit
from a strong position on the Community market.
However, the current investigation also established that
the effect of the measures was to permit the Community
industry to recover that share of the Community market
which it held before the Chinese dumping practices
began.

(82) One other user was also against the prolongation of the
the competition by
measures. This user argued that
Chinese exporters is indispensable in order to guarantee
the security of supply at competitive prices. Should
competitive prices not be guaranteed,
this user may
consider moving part of its fragrance compounding to
the PRC resulting in job losses in the Community.
However, given that coumarin represents about 1,5 % of
the total cost of production of this user, it is considered
unlikely that a transfer of the production of certain
compounds outside the Community would occur simply
as a result of the continuation of the existing anti-
dumping measures, especially since such transfer has not
occurred during the five years the measures have been in
force.

(83)

The same user also mentioned the production difficulties
suffered by the Community producer resulting in signifi-
cant delivery delays. Although the Community producer
faced production difficulties during the period under
review, these were due to particular circumstances that
are unlikely to recur on a regular basis, amongst which,
the upgrade of the existing installation mentioned under
recital 47. In addition, the impact of delivery problems
on users was found to be minor since, as mentioned
under recital 40, the Community producer was able to
import the like product to compensate for the shortage
of its production of the product concerned.

(87) Moreover, it should be noted that the world market for
coumarin is characterised by operation of only a few
producers. In such a situation, competition aspects have
to be followed with particular care, given that the effect
of the measures on these suppliers can have a consider-
able importance. However, the investigation has found
no indication as to any anti-competitive practices of the
it should be
Community producer.
underlined that its sales prices decreased over the period
under review. Furthermore, several alternative sources of
supply still exist since coumarin is or can be imported
from several countries amongst which are Japan and
the
India which still hold non-negligible shares of
Community market.

In this context,

(88) On the basis of the above, it has been concluded that
any competition-related concerns were considered not to
constitute a compelling reason against the continuation
of the measures.

6. Conclusion on Community interest

(89) Given the above,

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

I. ANTI-DUMPING MEASURES

(84) On the basis of the above, and in view of the low level
of cooperation, which in itself appears to confirm that
users did not suffer any substantial negative effect on
their economic situation as a result of the measures
currently in force, the impact on users was considered
not to constitute a compelling reason against the contin-
uation of the measures, as a possible negative effect on
users is unlikely to offset the positive effect on the
Community industry.

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

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Official Journal of the European Communities

L 123/9

(91)

It follows from the above that the anti-dumping meas-
ures currently in force with regard to imports of
coumarin originating in the People's Republic of China
should be maintained,

(TARIC code 2932 21 00 10) originating in the People's
Republic of China.

2.

The rate of the duty is set at EUR 3 479 per tonne.

HAS ADOPTED THIS REGULATION:

Article 2

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

Article 1

Article 3

1.
A definitive anti-dumping duty is hereby imposed on
imports of coumarin falling within CN code ex 2932 21 00

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

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

Done at Brussels, 7 May 2002.

For the Council

The President

R. DE RATO Y FIGAREDO