Proposal for a Council Regulation extending the definitive anti-dumping duty imposed by Regulation (EC) No 964/2003 on imports of tube or pipe fittings, of iron or steel, originating in the People's Republic of China to imports of tube or pipe fittings, of steel or iron, consigned from Indonesia, whether declared as originating in Indonesia or not
Date: 2004-10-22
Institutions: European Commission
Subjects: China, Indonesia, anti-dumping duty, piping

COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 22.10.2004 
COM(2004) 688 final 

.  

Proposal for a 

COUNCIL REGULATION 

extending the definitive anti-dumping duty imposed by Regulation (EC) No 964/2003 
on imports of tube or pipe fittings, of iron or steel, originating in the People's Republic 
of China to imports of tube or pipe fittings, of steel or iron, consigned from Indonesia, 
whether declared as originating in Indonesia or not 

(presented by the Commission) 

EN 

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EXPLANATORY MEMORANDUM 

By Regulation (EC) No 964/2003, the Council imposed in June 2003, inter alia, anti-dumping 
duties  of  58,6  %  on  imports  of  tube  or  pipe  fittings  originating  in  the  People’s  Republic  of 
China (PRC). 

In March 2004 the Commission initiated on its own initiative an investigation into a possible 
circumvention of the measures on imports of tube or pipe fittings originating in the PRC by 
imports of tube or pipe fittings consigned from Indonesia. 

The investigation showed a significant increase in the imports of tube or pipe fittings into the 
Community  from  Indonesia.  For  these  practises  no  economic  justification  or  sufficient  due 
cause  could  be  established  other  than  the  avoidance  of  the  anti-dumping  duty  in  force  on 
imports of tube or pipe fittings from the PRC.  

It  is  therefore  proposed  that  the  Council  adopt  the  attached  proposal  for  a  Regulation 
extending  the  definitive  anti-dumping  duty  of  58,6  %  imposed  on  imports  of  tube  or  pipe 
fittings originating in the PRC to imports of tube or pipe fittings consigned from Indonesia, 
whether declared as originating in Indonesia or not. The Regulation should be published in the 
Official Journal on 2 December 2004 at the latest. 

EN 

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Proposal for a 

COUNCIL REGULATION 

extending the definitive anti-dumping duty imposed by Regulation (EC) No 964/2003 
on imports of tube or pipe fittings, of iron or steel, originating in the People's Republic 
of China to imports of tube or pipe fittings, of steel or iron, consigned from Indonesia, 
whether declared as originating in Indonesia or not 

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 Community1(‘the basic 
Regulation’), and in particular Article 13 thereof, 

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

Whereas: 

1. 

Existing measures 

A. PROCEDURE 

(1) 

Following  an  expiry  review,  by  Regulation  (EC)  No  964/20032  (‘the  original 
Regulation’), the Council imposed, inter alia, definitive anti-dumping duties of 58,6 % 
on  imports  of  tube  or  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 code 7307 93 11 99), ex 7307 93 19 
(TARIC  code  7307  93  19  99),  ex  7307  99  30  (TARIC  code  7307  99  30  98)  and  ex 
7307 99 90 (TARIC code 7307 99 90 98) and originating in the People’s Republic of 
China (‘PRC’).  

1 
2 

EN 

OJ L 56, 6.3.1996, p. 1, as last amended by Regulation (EC) No 461/2004 (OJ L 77, 13.3.2004, p. 12). 
OJ  L  139,  6.6.2003,  p.  1,  as 
(OJ L 332, 19.12.2003, p. 3). 

last  amended  by  Regulation 

(EC)  No  2212/2003 

3 

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2. 

Initiation 

(2) 

(3) 

(4) 

(5) 

The  Commission  had  at  its  disposal  sufficient  prima  facie  evidence  that  the  anti-
dumping  measures  on  imports  of  certain  tube or pipe fittings originating in the PRC 
were being circumvented by means of transhipment and incorrect declaration of origin 
via  Indonesia.  Sufficient  evidence  for  the  opening  of  the  proceeding  concerning 
Indonesia could only be obtained by the Commission, by an inquiry with the customs 
authorities  of  a  Member  State,  which  showed  that  the  goods  were  not  originating  in 
Indonesia.  Therefore,  the  Commission  decided  to  initiate  on  its  own  initiative  an 
investigation according to Article 13 of the basic Regulation.  

Pursuant to some investigations carried out during 2003 by the customs authorities of 
one Member State, prima facie evidence was obtained, which showed in particular that 
regarding  imports  into  that  Member  State,  practices  had  been  detected  of  shipments 
declared  as  originating  in  Indonesia,  which  had  in  fact  been  shipped  and  originating 
from  the  PRC.  According  to  Eurostat  data,  imports  declared  as  originating  from 
Indonesia  into  this  Member  State  represented  two  thirds  of  imports  declared  as 
originating in Indonesia into the Community during 2003. The significant increase of 
imports, following the imposition of the anti-dumping measures on imports of tube or 
pipe fittings originating in the PRC appeared to constitute a change in the pattern of 
trade, for which there was insufficient due cause or economic justification other than 
the  existence  of  the  anti-dumping  duties  on  tube  or  pipe  fittings  originating  in  the 
PRC. 

Finally,  it  appeared  that  the  remedial  effects  of  the  existing  anti-dumping  duties  on 
imports of tube or pipe fittings originating in the PRC were being undermined both in 
terms  of  quantities  and  prices  and  that  dumping  was  taking  place  in  relation  to  the 
normal  values  previously  established  for  the  tube  or  pipe  fittings  originating  in  the 
PRC. 

The  Commission  therefore  initiated  on  its  own  initiative  an  investigation  by 
Regulation  (EC)  No  396/20043  (‘the  initiating  Regulation’)  into  the  alleged 
circumvention  of  the  anti-dumping  measures  imposed  on  imports  of  tube  or  pipe 
fittings  originating  in  the  PRC  by  imports  of  tube  or  pipe  fittings  consigned  from 
Indonesia, whether declared as originating in Indonesia or not and, pursuant to Articles 
13(3)  and  14(5)  of  the  basic  Regulation,  directed  the  customs  authorities  to  register 
imports  of  tube  or  pipe  fittings  consigned  from  Indonesia,  whether  declared  as 
originating in Indonesia or not, under CN codes ex 7307 93 11 (TARIC code 7307 93 
11  93),  ex  7307  93  19  (TARIC  code  7307  93  19  93),  ex  7307  99  30  (TARIC  code 
7307  99  30  93)  and  ex  7307  99  90  (TARIC  code  7307  99  90  93)  as  from  4  March 
2004.  The  Commission  advised  the  authorities  of  the  PRC  and  Indonesia  of  the 
initiation of the investigation. 

3 

OJ L 65, 3.3.2004, p. 10. 

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3. 

Investigation 

(6) 

(7) 

Questionnaires were sent to producers and exporters in the PRC (there was no known 
producer  in  Indonesia)  as  well  as  to  importers  in  the  Community  known  to  the 
Commission  from  the  investigation  which  led  to  the  imposition  of  the  existing 
measures  on  imports  of  tube  or  pipe  fittings  originating  in  the  PRC  (‘the  previous 
investigation’).  Interested  parties  were  given  the  opportunity  to  make  their  views 
known  in  writing  and  to  request  a  hearing  within  the  time  limit  set  in  the  initiating 
Regulation. 

No  producer  or  exporter  in  the  PRC  submitted  a  reply  to  the  questionnaire  and  no 
themselves  known  or  submitted 
producers  or  exporters 
questionnaire  replies.  Three  replies  to  the  questionnaire  were  submitted  by  unrelated 
importers in the Community. One of the importers did not further cooperate. 

in  Indonesia  made 

4. 

Investigation period 

(8) 

The  investigation  period  covered  the  period  from  1  January  2003  to  31  December 
2003  (‘IP’).  Data  from  2000  up  to  the  IP  were  used  to  investigate  the  change  in  the 
pattern of trade. 

B. RESULTS OF THE INVESTIGATION 

1. 

General considerations/degree of cooperation 

(a) Indonesia 

(9) 

No producers or exporters of tube or pipe fittings originating in Indonesia co-operated 
in  the  investigation.  The  authorities  of  Indonesia  did  not  supply  any  additional 
information.  It  was  made  clear  to  the  authorities  of  Indonesia  that  non  co-operation 
may  lead  to  the  application  of  Article  18  of  the  basic  Regulation.  Three  unrelated 
importers supplied a questionnaire reply. One importer, who had submitted a response 
to  the  questionnaire  where  necessary  information  for  ascertaining  the  existence  of 
circumvention lacked, did not clarify the deficiencies pointed out by the Commission 
in a defficiency letter as a reaction to its initial questionnaire reply and was therefore 
declared non-cooperating. The imports of the two other importers represented 5,5 % of 
total  imports  declared  as  originating  in  Indonesia  during  the  IP.  Overall,  it  can 
therefore  be  concluded  that  there  was  no  cooperation  from  producers  and  very  low 
cooperation from importers.  

(b) PRC 

(10)  No Chinese producers or exporters co-operated in the investigation. 

(11) 

It was made clear to these non-co-operating companies that non-co-operation may lead 
to the application of Article 18 of the basic Regulation. 

EN 

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2. 

Product concerned and like product 

(12)  The product concerned by the alleged circumvention is tube or 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, currently classifiable within CN codes ex 7307 93 11 
(TARIC  code  7307  93  11  93),  ex  7307  93  19  (TARIC  code  7307  93  19  93), 
ex  7307  99  30 
(TARIC  code  7307  99  30  93)  and  ex  7307  99  90 
(TARIC code 7307 99 90 93).  

(13)  Given  the  very  low  level  of  cooperation  it  must  be  inferred  that  the  tube  or  pipe 
fittings exported to the Community from the PRC and those consigned from Indonesia 
have  the  same  basic  physical  and  chemical  characteristics  and  have  the  same  uses. 
They are therefore to be considered as like products within the meaning of Article 1(4) 
of the basic Regulation. 

3. 

Change in the pattern of trade 

(14)  As stated above the prima facie evidence suggested that the change in the pattern of 
the  trade  stemmed  from  transhipment  and  an  incorrect  declaration  of  origin  of  the 
product,  as  imports  were  declared  as  originating  in  Indonesia,  whereas  evidence 
existed that the goods originated in the PRC. 

(15)  As no Indonesian company co-operated in the investigation, exports from Indonesia to 
the  Community  had  to  be  established  on  the  basis  of  the  facts  available  pursuant  to 
Article  18  of  the  basic  Regulation.  Eurostat  data,  which  were  the  most  appropriate 
information  available  in  such  a  situation,  were  therefore  used  to  establish  the  export 
prices and quantities from Indonesia to the Community.  

(16) 

Imports of tube or pipe fittings declared as originating in Indonesia increased from 0 
tonnes in 2000 to 866 tonnes in the IP. These imports from Indonesia commenced in 
January 2002, at a time when the previous investigation was ongoing. Imports into the 
Community of tube or pipe fittings from the PRC increased from 44 tonnes in 2000 to 
287  tonnes  in  the  IP.  However,  this  increase  in  exports  from  the  PRC  must  be  read 
together  with  the  level  of  exports  achieved  in  the  period  under  consideration  of  the 
original investigation4. Indeed, the volume of the Chinese exports in the IP amounted 
to  less  than  10%  of  the  volume  exported  in  the  period  under  consideration  of  the 
original  investigation.  In  the  light  of  the  above,  and  in  the  absence  of  any  contrary 
evidence, it was found that imports consigned from Indonesia were compensating for 
some of the previous imports from the PRC. 

4 

Council Regulation (EC) No 584/96 (OJ L 84, 3.4.1996, p. 1). 

EN 

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4. 

Insufficient due cause or economic justification 

(17) 

In  the  absence  of  cooperation  by  any  parties  in  Indonesia  and  the  PRC,  and  of  any 
contrary evidence, it is concluded that, given the coincidence in time with the previous 
investigation which led to the imposition of the existing measures, the change in the 
pattern of trade stemmed from the existence of the anti-dumping duty rather than from 
any other sufficient due cause or economic justification within the meaning of Article 
13(1), second sentence of the basic Regulation. 

(18) 

It is therefore concluded that no reasonable grounds other than avoiding the existing 
anti-dumping duties on imports of tube or pipe fittings originating in the PRC, could 
be established for the change in the pattern of trade observed. 

5. 

Undermining  of  the  remedial  effects  of  the  duty  in  terms  of  the  prices  and/or 
the quantities of the like products 

(19)  Based on the trade flow analysis made above, it was found that a change in the pattern 
of Community imports is linked to the fact that there were anti-dumping measures in 
place.  Imports  declared  as  originating  in  Indonesia  were  absent  of  the  Community 
market until January 2002. After said date imports declared as originating in Indonesia 
substantially increased, amounting to 866 tonnes during the IP. This volume represents 
1,7 % of the Community consumption during the IP of the previous investigation.  

(20)  With regard to prices of the products consigned from Indonesia and in the absence of 
co-operation from exporters and of any contrary evidence, Eurostat data revealed that 
average export prices from Indonesia during the IP were even lower than the average 
export prices established for the PRC in the previous investigation and therefore lower 
than the prices of the Community industry. It has been established that during the IP 
average  export  prices  from  Indonesia  were  around  34  %  below  the  average  export 
prices from the PRC. 

(21)  On the basis of the above, it is concluded that the change in trade flows, together with 
the  abnormally  low  prices  of  exports  from  Indonesia  have  undermined  the  remedial 
effects of the anti-dumping measures in terms of the quantities and prices of the like 
products. 

6. 

(22) 

Evidence of dumping in relation to the normal values previously established for 
like or similar products 

In order to determine whether evidence of dumping could be found with respect to the 
product  concerned  exported  to  the  Community  from  Indonesia  during  the  IP,  export 
prices established on the basis of Eurostat data were used pursuant to Article 18 of the 
basic Regulation.  

(23)  Article 13(1) of the basic Regulation requires evidence of dumping in relation to the 
normal values previously established for the like or similar products. In the previous 
investigation,  Thailand  was  found  to  be  the  appropriate  market  economy  analogue 
country for the PRC for the purpose of establishing normal value. 

EN 

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(24)  For the purpose of a fair comparison between the normal value and the export price, 
due  allowance,  in  the  form  of  adjustments,  was  made  for  differences  which  affect 
prices  and  price  comparability.  These  adjustments  were  made  in  accordance  with 
Article  2(10)  of  the  basic  Regulation  in  respect  of  transport  and  insurance.  In  the 
absence  of  other  information  relating  to  these  factors,  the  data  used  in  the  previous 
investigation was used.  

(25) 

In accordance with Articles 2(11) and 2(12) of the basic Regulation, the comparison of 
a weighted average normal value as established in the previous investigation and the 
weighted  average  of  export  prices  during  this  investigation’s  IP,  expressed  as  a 
percentage of the CIF price at the Community frontier duty unpaid, showed dumping 
for the imports of tube or pipe fittings consigned from Indonesia. The dumping margin 
found,  expressed  as  a  percentage  of  the  CIF  price  at  the  Community  frontier  duty 
unpaid, was 60,5 %. 

C. MEASURES  

(26) 

In view of the above finding of circumvention within the meaning of Article 13(1), of 
the  basic  Regulation,  the  existing  anti-dumping  measures  on  imports  of  the  product 
concerned originating in the PRC should be extended to the same product consigned 
from Indonesia, whether declared as originating in Indonesia or not.  

(27)  The  duty  extended  should  be  the  one  established  in  Article  1(2)  of  the  original 

Regulation. 

(28) 

In accordance with Articles 13(3) and 14(5) of the basic Regulation, which provides 
that any extended measures shall be applied against registered imports from the date of 
registration,  the  anti-dumping  duty  should  be  collected  on  imports  of  tube  or  pipe 
fittings  consigned  from  Indonesia  which  entered  the  Community  under  registration 
imposed by the initiating Regulation. 

(29)  The  circumvention  takes  place  outside  the  Community.  Article  13  of  the  basic 
Regulation aims to counter circumvention practices without affecting operators which 
can prove that they are not involved in such practices, but it does not contain a specific 
provision providing for the treatment of producers which could establish that they are 
not involved in circumvention practices. Therefore, it appears necessary to introduce a 
possibility for producers which have not sold the product concerned for export during 
the IP and are not related to any exporters or producers subject to the extended anti-
dumping  duty  to  request  an  exemption  from  the  measures  on  these  imports.  The 
producers concerned which would consider lodging a request for an exemption from 
the  extended  anti-dumping  duty  would  be  required  to  complete  a  questionnaire  in 
order  to  enable  the  Commission  to  determine  whether  an  exemption  may  be 
warranted. Such exemption  may  be granted after  the  assessment  of,  for  instance,  the 
market  situation  of  the  product  concerned,  production  capacity  and  capacity 
utilisation,  procurement  and  sales  and  the  likelihood  of  practices  for  which  there  is 
insufficient  due  cause  or  economic  justification  and  the  evidence  of  dumping.  The 
Commission would normally also carry out an on-spot verification visit. The request 
would  have  to  be  addressed  to  the  Commission  forthwith,  with  all  relevant 
information,  in  particular  any  modification  in  the  company's  activities  linked  to 
production and sales. 

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(30) 

Importers could still benefit from exemption for registration or measures to the extent 
that  their  imports  are  from  exporters,  which  are  granted  such  an  exemption,  and  in 
accordance with Article 13(4) of the basic Regulation. 

(31)  Where  an  exemption  is  warranted,  the  Commission  will,  after  consultation  of  the 
Advisory  Committee,  propose  the  amendment  of  this  Regulation  accordingly. 
Subsequently,  any  exemptions  granted  will  be  monitored  to  ensure  compliance  with 
the conditions set therein. 

D. PROCEDURE 

(32) 

Interested parties were informed of the essential facts and considerations on the basis 
of which the Council intended to extend the definitive anti-dumping duty in force and 
were  given  the  opportunity  to  comment.  No  comments  which  were  of  a  nature  to 
change the above-mentioned conclusions were received, 

HAS ADOPTED THIS REGULATION: 

Article 1 

1. 

The  definitive  anti-dumping  duty  imposed  by  Regulation  (EC)  No  964/2003  on 
imports of tube or 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  code  7307  93  11  99),  ex  7307  93  19 
(TARIC code 7307 93 19 99), ex 7307 99 30 (TARIC code 7307 99 30 98) and ex 
7307 99 90 (TARIC code 7307 99 90 98) and originating in the People’s Republic of 
China (PRC) is hereby extended to imports of tube or 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,  currently  classifiable  within  CN  codes  ex  7307  93  11 
(TARIC code 7307 93 11 93), ex 7307 93 19 (TARIC code 7307 93 19 93), ex 7307 
99 30 (TARIC code 7307 99 30 93) and ex 7307 99 90 (TARIC code 7307 99 90 93) 
consigned from Indonesia, whether declared as originating in Indonesia or not. 

2. 

The  duty  extended  by  paragraph  1  of  this  Article  shall  be  collected  on  imports 
registered in accordance with Article 2 of Regulation (EC) No 396/2004 and Articles 
13(3) and 14(5) of Regulation (EC) No 384/96. 

3. 

The provisions in force concerning customs duties shall apply. 

Article 2 

1. 

Requests for exemption from the duty extended by Article 1 shall be made in writing 
in one of  the official languages of the Community and must be signed by a person 
authorised  to  represent  the  applicant.  The  request  must  be  sent  to  the  following 
address: 

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European Commission 
Directorate-General for Trade 
Directorate B 
J-79 5/16 
B - 1049 Brussels 
Fax (32 2) 295 65 05 
Telex COMEU B 21877. 

2. 

The  Commission,  after  consulting  the  Advisory  Committee,  may  authorise,  by 
decision,  the  exemption  of  imports  from  companies  which  do  not  circumvent  the 
anti-dumping duty imposed by Regulation (EC) No 964/2003 from the duty extended 
by Article 1, and propose the amendment of the Regulation accordingly. 

Customs authorities are hereby directed to discontinue the registration of imports, established 
in accordance with Article 2 of Regulation (EC) No 396/2004. 

Article 3 

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

Article 4 

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

Done at Brussels, […] 

For the Council 
The President 

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