Council Regulation (EC) No 1514/2002 of 19 August 2002 imposing a definitive anti-dumping duty and collecting definitively the provisional duty imposed on imports of certain tube and pipe fittings, of iron or steel originating in the Czech Republic, Malaysia, Russia, the Republic of Korea and Slovakia
Date: 2002-08-19
Institutions: Council of the European Union
Subjects: anti-dumping duty, import, originating product, piping, third country

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I

(Acts whose publication is obligatory)

COUNCIL REGULATION (EC) No 1514/2002

of 19 August 2002

imposing a definitive anti-dumping duty and collecting definitively the provisional duty imposed
on imports of certain tube and pipe fittings, of iron or steel originating in the Czech Republic,
Malaysia, Russia, the Republic of Korea and Slovakia

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,

(4)

(5)

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

the essential

All parties were informed of
facts and
considerations on the basis of which it was 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.

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

(6)

Whereas:

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

A. PROVISIONAL MEASURES

C. PRODUCT CONCERNED AND LIKE PRODUCT

(1)

(2)

(3)

The Commission, by Regulation (EC) No 358/2002 (2)
(the ‘provisional Regulation’),
imposed a provisional
anti-dumping duty on imports of certain tube and pipe
fittings (TPFs), of iron or steel, falling within CN codes
ex 7307 93 11, ex 7307 93 19, ex 7307 99 30 and
ex 7307 99 90, originating in the Czech Republic,
Malaysia, Russia, the Republic of Korea and Slovakia.

It is recalled that the investigation period of dumping
and injury covered the period from 1 April 2000 to 31
March 2001 (‘IP’). The examination of trends relevant for
the injury analysis covered the period from 1 January
1996 to 31 March 2001 (‘period under consideration’).

B. SUBSEQUENT PROCEDURE

Following the imposition of provisional anti-dumping
duties on imports of certain tube and pipe fittings
originating in the Czech Republic, Malaysia, Russia, the
Republic of Korea and Slovakia, some interested parties
submitted comments in writing. The parties who so
requested were also granted an opportunity to be heard
orally.

(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 56, 27.2.2002, p. 4.

(7)

In the absence of any comments, the product descrip-
tion and the definition of the like product as set out in
recitals 9 to 12 of
the provisional Regulation are
confirmed.

D. DUMPING

1. General methodology

(8)

(9)

In the absence of any comments, the general methodo-
logy for establishing the dumping margins as set out in
recitals 15 to 28 of
the provisional Regulation is
confirmed.

2. Dumping margins

In the absence of any comments, the determination of
the normal value, the export price and the comparison
for the Czech Republic, Malaysia, Republic of Korea,
Slovakia and the determination of the market economy
status and analogue country for Russia, as described in
recitals 29 to 60 of
the provisional Regulation, are
confirmed.

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(10)

a
The definitive dumping margins,
percentage of the CIF import price at the Community
border, are confirmed as follows:

expressed as

Country

Company

Dumping margin
(%)

Czech Republic

Mavet a.s., Trebic

Bovex s.r.o.

Malaysia

Anggerik Laksana Sdn
Bhd

Republic of Korea

Slovakia

Bohus s.r.o.

Zeleziarne Podbrezova
a.s.

Russia

17,6

22,4

59,2

83,9

7,7

15,0

43,3

E. COMMUNITY INDUSTRY

(11)

In the absence of any comments, the provisional find-
ings concerning the determination of the Community
industry as described in recitals 61 to 62 of the provi-
sional Regulation are confirmed.

F. INJURY

1. Community consumption

(12)

In the absence of any new information, the provisional
findings concerning the Community consumption as
described in recitals 63 to 64 of the provisional Regula-
tion are confirmed.

2. Imports from the countries concerned

Cumulative assessment of the effects of the imports concerned,
volume, market share and prices of the imports concerned

(13)

countries

The provisional Regulation concluded that the imports
originating in the
concerned should be
assessed cumulatively since the criteria set out in the
Article 3(4) of the basic Regulation were met. Indeed,
the dumping margins
the countries
concerned were more than de minimis, the volume of
imports were not negligible and the cumulative assess-
ment was considered appropriate in view of the condi-
tions of competition both between the imports and

found for all

between the imports and the like Community product.
These similar conditions of competition were evidenced
by the fact that the imported TPFs and those of the
Community industry were alike and distributed via the
same trade channels under similar commercial condi-
tions. Moreover, all import volumes were substantial and
resulting in significant market shares, which increased
between 1996 and the IP, and were made at prices
significantly undercutting the prices of the Community
industry thus leading to a price depression of
the
Community industry's prices.

(14)

In the absence of any comments under these headings,
the provisional findings as described in recitals 65 to 67
of the provisional Regulation are confirmed.

Price undercutting

(15) One Slovak exporting producer questioned the meth-
odology used by the Commission for the calculation of
the price undercutting margins. This relates more specifi-
cally to the method of the so-called ‘zeroing’, by which
the positive margins for the models that are overcutting
are disregarded. This argument is based on the conclu-
sions reached by the WTO Appellate Body in the bed
linen case (1) by which, on the facts of
the case
concerned, the practice of zeroing when establishing the
existence of margins of dumping, which in that case was
established by a comparison of the weighted average
normal value with the weighted average export price as
established by the Commission, was found to be incon-
sistent with the Article 2.4.2 of the WTO Anti-Dumping
Agreement.

(16) Accordingly, it should be noted that the WTO Appellate
Body in any event exclusively examined the practice of
‘zeroing’ when used to establish the existence of
dumping margins. In addition, the WTO Anti-Dumping
Agreement does not set out any methodological require-
ments for the calculation of price undercutting.

(17)

(18)

In any event, in the current case, in view of the very few
models for which no undercutting was found,
the
application of the ‘zeroing’ methodology does not lead
to significantly different results, the difference between
applying zeroing or not amounting to less than 1 %. In
other words the undercutting margins would remain
significant even if no zeroing was applied. The argument
had therefore to be rejected.

The Community industry argued that no adjustment for
level of trade should be made in order to establish the
price undercutting margin. Indeed, both the exporting
producers and the Community industry supply the same
category of customers, and therefore act on the same
level of trade. It was further claimed that consequently
only an adjustment covering customs clearance cost was
justified.

(19) A further analysis of the information available estab-
lished that both the Community industry and the
exporting producers generally supply the same type of
customers in the Community, i.e. wholesalers. This was
also supported by the fact that the three cooperating
unrelated importers, whose activity is the one of whole-
salers, were supplied by both the Community industry

(1) European Communities: Anti-dumping duties on imports of

cotton-type bed linen from India, WT/DS/AB/R, 1.3.2001.

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(20)

(21)

(22)

(23)

from the

exporting producers

countries
and the
concerned. The argument was therefore accepted and
the undercutting margins
revised accordingly. The
revised adjustment was limited to an amount covering
exclusively the customs clearance costs, on the basis of
the information provided by the cooperating unrelated
importers.

The Community industry further questioned the level of
the undercutting margin calculated for one of the Slovak
exporting producers. It was argued that this level of
undercutting was inconsistent with the average price
level as given by international trade statistics as well as
market information.

(24)

In the absence of any comments, the facts and figures as
set out in recitals 72 to 87 of the provisional Regulation
are confirmed.

4. Conclusion on injury

(25)

In the absence of any further comments on the findings
other than those set out above, the conclusion reached
as set out in recital 88 of the provisional Regulation is
confirmed.

The calculations of the price undercutting margins were
accordingly reviewed, and a clerical error was found in
the calculation of the export price used for the establish-
ment of this exporting producer's margin of undercut-
ting. The margin was therefore revised.

(26)

In the absence of any new information submitted on
causation, the findings and the conclusion reached as set
out in recitals 89 to 97 of the provisional Regulation are
confirmed.

G. CAUSATION

the definitive
Taking the above into consideration,
revised weighted average price undercutting margins
found per country, expressed as a percentage of the
Community industry prices, are as follows:

— Czech Republic: from 19 % to 21 %,

H. COMMUNITY INTEREST

(27)

In the absence of any new information submitted on the
Community interest, the findings and the conclusion
reached as set out in recitals 98 to 111 of the provi-
sional Regulation are confirmed.

— Malaysia: from 52 % to 72 %,

— Russia: 26 %,

— Republic of Korea: 23 %,

— Slovakia: from 15 % to 36 %.

3. Situation of the Community industry

is recalled that

the introduction of

It
the measures
against China, Croatia and Thailand had a positive
impact on the economic situation of the Community
industry. Most of the injury indicators showed a positive
development between 1996 and 1998. Production,
capacity utilisation and sales volume went up, resulting
in a gain in market shares and increasing employment.
The profitability indicators such as profits/losses as a
percentage of turnover, return on investments and cash
flow also developed favourably. However, after 1998,
the Community industry
the economic situation of
generally deteriorated: while production remained rela-
tively stable and capacity utilisation, employment and
wages slightly increased, crucial indicators such as the
volume of sales and market shares decreased as well as
profitability, return on investments cash flow and prices.
On the basis of the above and of the findings regarding
productivity,
investments, growth and magnitude of
dumping, it was therefore concluded, at a provisional
stage, that the Community industry suffered material
injury.

I. DEFINITIVE ANTI-DUMPING MEASURES

1. Injury elimination level

(28)

Based on the methodology explained in recitals 112 to
115 of the provisional Regulation an injury elimination
level has been calculated for the purposes of establishing
the level of measures to be definitively imposed.

(29) One exporting producer questioned the level of

the
profit margin of 5 % that was used for the purpose of
establishing the non-injurious price of the Community
industry, claiming it was too high. It also claimed that
this level of profit margin was not sufficiently explained
in the disclosed document.

(30) As to the first claim, it is recalled that, in view of the
negative impact on the profitability of the Community
industry resulting from the price depressive effect caused
by the dumped imports, as indicated in recital 71 of the
provisional Regulation, the calculation of the non-injur-
ious price was based on a level of profit
the
Community industry might have reasonably achieved in
the absence of injurious dumping. As explained in the
recital 114 of the provisional Regulation, a profit margin
of 5 % was deemed reasonable, since this level of profit
corresponds
the
Community industry could achieve in 1997, on a
Community market free of dumped imports. Indeed, at
that time, measures were in place against China, Croatia

level of profit

to the actual

that

that

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and Thailand and the market share of imports from the
countries concerned was still relatively low. Moreover, it
was considered that this profit margin would allow the
Community industry to make the necessary investments.
As to the second claim,
it should be noted that the
Commission explained in sufficient detail in the disclo-
sure document on which basis it calculated the level of
profit margin used for the non-injurious price, as also
explained in recital 114 of the provisional Regulation.
The claims have therefore to be rejected.

(31)

In addition, the same level of profit was also used for the
establishment of the injury margin in the proceeding
concerning the abovementioned countries, and there is
no reason to believe that significant changes in circum-
stances have occurred since then.

(32)

The use of a profit margin of 5 % of turnover for the
calculation of
therefore
confirmed.

the non-injurious price is

(33) On the basis of the above, the methodology used for
establishing the injury elimination level as described in
recitals 112 to 115 of the provisional Regulation is
confirmed.

(34) As mentioned above in relation to price undercutting
margins, injury margins were reviewed and amended for
one of the exporting producers in Slovakia.

2. Form and level of the duties

(35)

In the light of the foregoing and in accordance with
Article 9(4) of the basic Regulation, a definitive anti-
dumping duty should be imposed in respect of
the
Czech Republic, Malaysia, Russia, the Republic of Korea
and Slovakia. This duty should be imposed at the level
of the dumping margins found, except for the Republic
of Korea, where the injury margin was found to be
lower than the dumping margin.

3. Collection of provisional duties

(37)

secured by way of

In view of the magnitude of the dumping margins found
and in the light of the level of the injury caused to the
Community industry, it is considered necessary that the
amounts
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.

(38) 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 rele-
vant 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 Regulation accord-
ingly by updating the list of companies benefiting from
individual duty rates.

4. Undertakings

(39)

It is recalled that one exporting producer in Slovakia has
offered a price undertaking in accordance with Article
8(1) of the basic Regulation. This price undertaking was
accepted in the provisional Regulation.

(36) On the basis of the above, the definitive duties are as

(40)

follows:

Country

Company

Anti-dumping
duty
(%)

Czech Republic

All companies

Malaysia

Anggerik Laksana Sdn
Bhd

Others

Russia

All companies

Republic of Korea

All companies

Slovakia

All companies

22,4

59,2

75,0

43,3

44,0

15,0

Subsequent
to the imposition of provisional anti-
dumping measures, one exporting producer in the Czech
Republic offered a price undertaking in accordance with
Article 8(1) of the basic Regulation. By doing so, it has
agreed to sell the product concerned at or above price
levels which eliminate the injurious effects of dumping.
The company will also provide the Commission with
regular and detailed information concerning its exports
to the Community, meaning that the undertaking can be
monitored effectively by the Commission. Furthermore,
the sales structure of this exporting producer is such that
the Commission considers that the risk of circumventing
the agreed undertaking is limited.

(41)

To further enable the Commission to effectively monitor
the compliance of the company with its undertaking,
when the request
for release for free circulation is
presented to the relevant customs authority, exemption
from the anti-dumping duty is to be conditional on the
presentation of a commercial invoice containing at least

(1) European Commission, DG Trade, Directorate B,

J-79 — 3/35,

B-1049 Brussels.

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the elements listed in the Annex. This level of informa-
tion is also necessary to enable customs authorities to
ascertain with sufficient precision that shipments corre-
spond to the commercial documents. Where no such
invoice is presented, or when it does not correspond to
the product presented to customs, the appropriate rate
of anti-dumping duty will

instead be payable.

HAS ADOPTED THIS REGULATION:

Article 1

(42)

In view of this, the offer of the undertaking is therefore
considered acceptable by the Commission and the
company concerned has been informed of the essential
facts, considerations and obligations upon which accep-
tance is based.

(43)

It should be noted that in the event of a breach or
withdrawal of the undertaking or a suspected breach, an
anti-dumping duty may be imposed, pursuant to Articles
8(9) and (10) of the basic Regulation.

1.
A definitive anti-dumping duty is hereby imposed on
imports of tube and pipe fittings (other than cast fittings,
flanges and threaded fittings), of iron or steel (not including
stainless steel), with a greatest external diameter not exceeding
609,6 mm, of a kind used for butt-welding or other purposes,
falling within CN codes
ex 7307 93 11 (TARIC codes
7307 93 11*91 and 7307 93 11*99), ex 7307 93 19 (TARIC
codes 7307 93 19*91 and 7307 93 19*99),ex 7307 99 30
and
(TARIC codes 7307 99 30*92 and 7307 99 30*98)
ex 7307 99 90
and
7307 99 90*98) and originating in the Czech Republic,
Malaysia, Russia, the Republic of Korea and Slovakia.

7307 99 90*92

(TARIC

codes

(44)

The above undertaking is accepted by Commission
Decision 2002/675/EC (1),

2.
The rate of the definitive anti-dumping duty applicable to
the net, free-at-Community-frontier price, before duty, shall be
as follows for the products manufactured by:

Country

Company

Definitive anti-dumping
duty
(%)

TARIC additional code

Czech Republic

Mavet a.s., Trebic

Malaysia

All other companies

Anggerik Laksana Sdn Bhd,
Selangor Darul Ehsan

All other companies

Russia

All companies

Republic of Korea

All companies

Slovakia

All companies

17,6

22,4

59,2

75,0

43,3

44,0

15,0

A323

A999

A324

A999

A999

Notwithstanding paragraph 1, the definitive anti-dumping duty shall not apply to imports released

3.
into free circulation in accordance with Article 2.

4.

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

Article 2

1.
Imports declared for release into free circulation under the following TARIC additional code which are
produced and directly exported (i.e. shipped and invoiced) by the company below to a company in the
Community acting as an importer shall be exempt from the anti-dumping duty imposed by Article 1
provided that such imports are imported in conformity with paragraph 2 of this Article.

Country

Company

TARIC additional code

Czech Republic

Bovex s.r.o., Hercikova 4, 612 00 Brno

Slovakia

Bohus s.r.o., Nálepkova 310, 976 45 Hronec

A387

A329

(1) See page 34 of this Official Journal.

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2.

Imports mentioned in paragraph 1 shall be exempt from the anti-dumping duty on condition that:

(a) a commercial invoice containing at least the elements listed in the Annex is presented to Member States'
customs authorities upon presentation of the declaration for release into free circulation; and

(b) the goods declared and presented to customs correspond precisely to the description on the commercial

invoice.

Article 3

Amounts secured by way of provisional anti-dumping duties pursuant to Regulation (EC) No 358/2002 on
falling within CN codes ex 7307 93 11,
imports of certain tube and pipe fittings, of
ex 7307 93 19, ex 7307 99 30 and ex 7307 99 90 and originating in the Czech Republic, Malaysia,
Russia, the Republic of Korea and Slovakia shall 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.

iron or steel

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, 19 August 2002.

For the Council

The President

P. S. MØLLER

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ANNEX

The following elements shall be indicated in the commercial invoice accompanying the company’s sales of tube and pipe
fittings 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 fron-

tier.

6. The exact description of the goods, including:

— Product Code Number (PCN),

— description of the goods corresponding to the PCN (e.g. ‘PCN 1 …’, ‘PCN 2 …’),

— company product code number (CPC) (if applicable),

— CN code,

— quantity (to be given in tonnes and pieces).

7. The description of the terms of sale, including:

— price per tonne and per piece,

— the applicable payment terms,

— the applicable delivery terms,

— total discounts and rebates.

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 European Commission through Decision 2002/675/EC. I declare that the infor-
mation provided in this invoice is complete and correct.’