Council Regulation (EC) No 1841/2002 of 14 October 2002 amending Regulation (EC) No 900/2001 imposing definitive anti-dumping duties on imports of urea and ammonium nitrate solutions originating in Poland
Date: 2002-10-14
Institutions: Council of the European Union
Subjects: Poland, anti-dumping duty, anti-dumping legislation, import, organic fertiliser, originating product

17.10.2002

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Official Journal of the European Communities

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COUNCIL REGULATION (EC) No 1841/2002

of 14 October 2002

amending Regulation (EC) No 900/2001 imposing definitive anti-dumping duties on imports of urea
and ammonium nitrate solutions originating in Poland

THE COUNCIL OF THE EUROPEAN UNION,

C. PROCEDURE

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(3) thereof,

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

Whereas:

A. EXISTING MEASURES

the Council
By Regulation (EC) No 900/2001 (2),
imposed a definitive anti-dumping duty on imports of
urea and ammonium nitrate solutions (UAN) originating
in Poland. That Regulation changed the form of the
measure from the minimum import prices imposed orig-
inally by Regulation (EC) No 3319/94 into a specific
duty of EUR 19 per tonne with regard to Zaklady
Azotowe Pulawy SA and EUR 22 per tonne for all other
Polish exporting producers.

(3)

(4)

(5)

(6)

(7)

The investigation of dumping covered the period from 1
October 2000 until 30 September 2001 (the ‘invest-
igation period’ or ‘IP’).

The Commission officially advised the authorities of the
exporting country of the initiation of the interim review
and gave all the parties directly concerned the oppor-
tunity to make their views known in writing and to
request a hearing.

The Commission sent a questionnaire and received
detailed information from the applicant.

The Commission sought and verified all information it
deemed necessary for the purpose of a determination of
dumping and carried out a verification visit at the prem-
ises of the exporting producer concerned.

The applicant and the Community industry were
informed of the facts and considerations of the invest-
igation and were given an opportunity to comment.
Their comments were taken into account and, where
appropriate,
the findings were modified as reflected
above.

B. REQUEST FOR A REVIEW

D. PRODUCT CONCERNED AND LIKE PRODUCT

for an interim review of

the Polish exporting producer
On 28 June 2001,
Zaklady Azotowe Pulawy SA (the applicant) lodged a
request
the anti-dumping
measure applicable to it,
limited to the aspects of
dumping pursuant to Article 11(3) of Regulation (EC)
No 384/96 (the basic Regulation). The request provided
prima facie evidence that measures were no longer
necessary to counteract dumping, and also that this was
attributable to lasting changes in circumstances. Notably,
the applicant alleged that it had started to sell UAN on
the domestic market.
It was further alleged that the
export sales pattern had changed as the company had
stopped selling through its related exporter. The appli-
cant had provided prima facie evidence showing the
after
absence
consulting the Advisory Committee,
sufficient
prima facie evidence existed for the initiation of an
interim review, the Commission published a notice in
the Official Journal of the European Communities (3) and
commenced an investigation.

determined,
that

dumping. Having

of

(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 127, 9.5.2001, p. 1.
(3) OJ C 288, 13.10.2001, p. 2.

(8)

The findings of the previous investigation as published
in Regulation (EC) No 900/2001 with regard to product
concerned and like product were confirmed.

E. DUMPING

1. Normal value

(9)

It was then determined whether

It was first determined that the total volume of domestic
sales of UAN was representative in relation to export
sales. Indeed, the sales volume on the Polish domestic
market was higher than the sales volume exported to the
Community.
these
domestic sales had been made in the ordinary course of
trade. In this regard, the investigation showed that the
volume of sales above unit production cost represented
more than 10 % but less than 80 % of all sales. There-
fore, normal value was established on the basis of the
prices actually paid for all profitable sales of the product
under consideration.

(1)

(2)

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(10)

The Community industry presented a dumping calcula-
tion based on a constructed normal value and assump-
tions regarding costs, prices and adjustments. However,
the assumptions were not correct as they were not
borne out by the actual confidential data verified in the
course of the investigation. Moreover, no indication was
found which put into question these verified data.

(11) After

this

final disclosure,

the Community industry re-
presented the calculation mentioned under recital 10
calculation incorporating a
together with another
normal value based on domestic prices
time
claiming that
the difference between its and the
Commission's calculations could only be due to very low
gas prices. A comparison between the data submitted by
the applicant and verified by the Commission on the
one hand and the data used for the dumping calcula-
tions submitted by the Community industry showed that
the most important differences were not related to the
gas price issue. The major differences between these
calculations concerned most other cost factors including
adjustments, the use factors, and the allocation of gas
prices paid in certain periods to UAN sold during the IP,
and these differences stemmed from the fact that the
interested party used assumed information whereas the
Commission's calculation was based on verified data.
Since the Community industry was unable to provide
its
sufficient evidence to support
assumptions, the Commission's findings based on veri-
fied data are confirmed.

the accuracy of

(12)

(13)

(14)

2. Export price

Since all export sales of the product concerned were
made directly
in the
Community, the export price was established in accord-
ance with Article 2(8) of the basic Regulation on the
basis of the prices actually paid or payable.

to independent

customers

3. Comparison

For the purposes of a fair comparison by type on an
ex-factory basis and at the same level of trade, due
allowance was made for differences which were claimed
and demonstrated to affect price comparability. These
adjustments were made in respect of transport, handling,
loading and ancillary costs, credit and commissions in
accordance with Article 2(10) of the basic Regulation.

The applicant, having invoiced all export sales to the
Community in the IP in US, had asked for an adjustment
for currency conversion referring to a sustained revalu-
ation of the Polish Zloty against the USD, which alleg-
edly took place in the period from October 2000 to
June 2001.

(15)

It was found, however, that while there was an apprecia-
tion of the Polish Zloty against the US during most of
the IP, the Polish Zloty effectively devalued against the
USD during the last four months of the IP. If the adjust-
ment had been applied to the transactions influenced by
the upward move of the Zloty, it should also have been
applied to the ones effected by its downward move. The
company was unable to demonstrate that such adjust-
ments would have any overall effect.

(16) Under these circumstances, the claim for a currency
conversion adjustment could not be accepted.

4. Dumping margin

(17)

among different

It was found that there was a pattern of export prices
time
which differed significantly
periods. In particular, it was found that export prices
during the last two months of the IP were particularly
low. This could not be explained by a similar develop-
ment of the general price level of UAN. Consequently, a
comparison of the normal value and export prices on a
weighted average basis did not reflect the full degree of
dumping being practised. A transaction-by-transaction
comparison on the basis of individual export prices with
individual normal values was not possible due to impor-
tant differences between the transaction dates and the
quantities sold of the export transactions on the one
hand and the domestic transactions on the other hand.
In order to calculate the dumping margin, the weighted
average normal value was therefore compared to prices
of all individual export transactions to the Community,
in accordance with the second subparagraph of Article
2(11) of the basic Regulation.

(18) After final disclosure of

the original

the basis on which it was
intended to amend the anti-dumping measures in force,
the Community industry argued that
the dumping
margin in the original proceeding had been established
on the basis of a comparison of prices of individual
export transactions with prices of individual domestic
transactions and claimed that such a comparison should
be carried out in the current investigation. However, an
this
examination of
method was not used in the original
investigation.
Indeed this is also evident on a careful reading of
Commission Regulation (EC) No 1506/94 of 27 June
1994 imposing provisional duties on imports of urea
ammonium nitrate solution originating in Bulgaria and
Poland (1), which states that ‘the ex-factory export prices
of UAN were compared on a transaction-by-transaction
basis with the normal value established as described in
recitals 12 and 13’. Since those recitals make clear that
normal value was constructed on the basis of the produ-
cers full, fixed and variable manufacturing cost to which

showed that

files

(1) OJ L 162, 30.6.1994, p.16. Regulation as

last amended by
Council Regulation (EC) No 2620/94 (OJ L 280, 29.10.1994, p.
1).

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for

selling general and administrative
an amount
expenses as well as a reasonable profit margin was
added, it is obvious that individual export prices were
compared to a weighted average normal value. In any
event, as explained above, it was not possible to carry
indi-
out a transaction-by-transaction comparison of
vidual export prices with individual normal values due
to important differences between the transaction dates
and the quantities sold of the export transactions on the
one hand and the domestic transactions on the other
hand. This argument was therefore rejected.

(19)

The comparison, as described in recital 17, showed the
existence of de minimis dumping for the applicant. The
dumping margin established, expressed as a percentage
of the total cif value at Community frontier level, duty
unpaid,

is 0,8 %.

(24)

It is therefore concluded that a return to dumping prac-
tices with regard to UAN sales by the applicant in the
Community market is rather unlikely.

(25) After final disclosure, the Community industry claimed
that the above changes in circumstances could not be
regarded as being of a lasting nature in particular,
because of the limited size of the domestic market in
Poland, the lack of other export markets, and the enor-
mous production capacity of the applicant. However, it
was found that the domestic market in Poland, the size
largely underestimated by the
of which was in fact
Community industry, was
significant and growing,
which in itself reduces the potential threat created by the
applicant's production capacity
assumed
resulting dependence on export markets. In addition, it
was found that other export markets were easily acces-
sible for the applicant. Therefore, there was no reason to
believe the change, i.e. the absence of dumping, would
not be of a lasting nature.

and the

(20)

(21)

(22)

(23)

F. LASTING NATURE OF CHANGED CIRCUMSTANCES

G. CONCLUSION

In accordance with the Commission's normal practice, it
was examined whether the changed circumstances could
reasonably be said to be of a lasting nature. It was found
that the applicant had significant exports of UAN to
non-EC countries during the last two financial periods
ending in December 1999 and in June 2001 as well as
during the IP. In this context, it should be mentioned
that exports to non-EC countries increased substantially
during the IP.

It was also found that the applicant has made a signifi-
cant effort to increase sales on the domestic market by
promoting the increased use of liquid fertilisers (UAN),
and by developing an extensive distribution network
supported by investments in storage facilities at
the
wholesalers premises. The applicant's domestic sales of
urea ammonium nitrate solutions thus increased by
18 % from 2000 and by 35 % from 1999 to the IP.

(26)

(27)

In view of the finding of a de minimis dumping margin
for the applicant and as this situation is not considered
to be of a short-term nature, the specific anti-dumping
duty imposed by Regulation (EC) No 900/2001 on
exports of the applicant should be replaced by a EUR 0
duty amount.

The amendment of
the measures concerns only the
applicant and not Poland as a whole. The applicant
remains subject to the proceeding and may be reinvesti-
gated in any subsequent review carried out for Poland
pursuant to Article 11 of the basic Regulation. All other
producers in Poland remain subject
to the existing
residual rate of duty, although it is open to them and
other interested parties to request a review of these
measures in accordance with Article 11 of the basic
Regulation,

It should be noted that the farmers' shift to the liquid
fertiliser UAN involves investments in equipment used
for its spreading. Therefore, it is reasonable to presume
that the domestic demand for UAN will be constant or
increasing in the foreseeable future.

HAS ADOPTED THIS REGULATION:

Article 1

increased sales

than the
to markets other
The
Community,
in particular the domestic Polish market,
are having a noticeable influence on the overall cost
structure. This in turn has an influence on the profit-
ability of UAN sales by the applicant on the domestic
market and as a consequence on the normal value.

Article 1(2) of Regulation (EC) No 900/2001 shall be replaced
by the following:

‘2.
The amount of the applicable duty per tonne of
product shall be as shown below for the products manufac-
tured by the following companies:

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Country

Company

Amount of duty
(EUR per tonne)

TARIC additional code

Poland

Zaklady Azotowe Pulawy SA
Al. Tysiaclecia P.P. 13,
24-110 Pulawy
Poland

Other companies

0

22

8795

8900’

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

Article 2

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

Done at Luxembourg, 14 October 2002.

For the Council

The President

L. ESPERSEN