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 iron or steel, consigned from Sri Lanka, whether declared as originating in Sri Lanka or not
Date: 2004-10-22
Institutions: European Commission
Subjects: China, Sri Lanka, anti-dumping duty, piping

COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 22.10.2004 
COM(2004) 691 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 iron or steel, consigned from Sri Lanka, 
whether declared as originating in Sri Lanka or not 

(presented by the Commission) 

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EXPLANATORY MEMORANDUM 

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

Following  a  request  lodged  by  the  Defence  Committee  of  the  Steel  Butt-Welding  Fittings 
Industry  of  the  European  Union  on  behalf  of  four  Community  producers,  the  Commission 
initiated  in  March  2004  an  investigation  into  the  alleged  circumvention  of  the  measures  on 
imports  of  tube  or  pipe  fittings  originating  in  the  PRC  by  imports  of  tube  or  pipe  fittings 
consigned from Sri Lanka. 

The investigation showed a significant increase in the imports of tube or pipe fittings into the 
Community  from  Sri  Lanka.  For  these  practises  no  economic  justification  or  sufficient  due 
cause could be established other than the avoidance of the anti-dumping duty imposed on tube 
or pipe fittings originating in 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 Sri Lanka, 
whether  declared  as  originating  in  Sri  Lanka  or  not.  The  Regulation  should  be  published  in 
the Official Journal on 2 December 2004 at the latest. 

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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 iron or steel, consigned from Sri Lanka, 
whether declared as originating in Sri Lanka 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 

OJ  L  56,  6.3.1996,  p.  1, 
(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). 

as 

last 

amended  by  Regulation 

(EC)  No  461/2004 

last  amended  by  Regulation 

(EC)  No  2212/2003 

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2. 

Request 

(2) 

(3) 

(4) 

(5) 

On 20 January 2004, the Commission received a request pursuant to Article 13(3) of 
the  basic  Regulation  to  investigate  the  alleged  circumvention  of  the  anti-dumping 
measures  imposed  on  imports  of  tube  or  pipe  fittings  originating  in  the  PRC.  The 
request was submitted by the Defence Committee of the Steel  Butt-Welding Fittings 
Industry of the European Union on behalf of four Community producers. 

The request alleged that there had been a change in the pattern of trade following the 
imposition of the anti-dumping measures on imports of tube or pipe fittings originating 
in the PRC, as shown by a significant increase in imports of the same product from Sri 
Lanka. 

This change in the pattern of trade was alleged to stem from the transhipment of tube 
or pipe fittings originating in the PRC via Sri Lanka. It was further alleged that there 
was insufficient due cause or economic justification for these practices other than the 
existence of the anti-dumping duties on tube or pipe fittings originating in the PRC. 

Finally,  the  applicant  alleged  that  the  remedial  effects  of  the  existing  anti-dumping 
duties on 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. 

3. 

Initiation 

(6) 

The  Commission  initiated  an  investigation  by  Regulation  (EC)  No  395/20043  (‘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 Sri Lanka, whether declared as originating in Sri Lanka 
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  Sri 
Lanka,  whether  declared  as  originating  in  Sri  Lanka  or  not,  under  CN  codes  ex 
7307  93  11  (TARIC  code  7307  93  11  94),  ex  7307  93  19  (TARIC  code 
7307  93  19  94),  ex  7307  99  30  (TARIC  code  7307  99  30  94)  and  ex 
7307  99  90  (TARIC  code  7307  99  90  94)  as  from  4  March  2004.  The  Commission 
advised the authorities of the PRC and Sri Lanka of the initiation of the investigation. 

4. 

Investigation 

(7) 

Questionnaires were sent to the producers/exporters in the PRC (there were no known 
producers in Sri Lanka) as well as to importers in the Community named in the request 
or  known  to  the  Commission  from  the  investigation  which  lead  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.  

3 

OJ L 65, 3.3.2004, p. 7. 

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(8) 

No  producer  or  exporter  in  the  PRC  submitted  a  reply  to  the  questionnaire  and  no 
reply  to  the  questionnaire  was  submitted  by  any  importer  in  the  Community.  No 
producers  or  exporters  in  Sri  Lanka  made  themselves  known  or  submitted 
questionnaire replies. 

5. 

Investigation period 

(9) 

The  investigation  period  covered  the  period  from  1  January  2003  to  31  December 
2003  (‘IP’).  Data  from  2000  up  to  the  end  of  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) Sri Lanka 

(10)  No producers or exporters of tube or pipe fittings originating in Sri Lanka co-operated 
in the investigation. In fact, the authorities of Sri Lanka informed the Commission that 
no  Sri  Lankan  companies  are  registered  as  manufacturers  of  tube  or  pipe  fittings  as 
defined  in  the  initiating  Regulation.  The  only  feedback  received  from  importers  was 
statements that they did not import tube or pipe fittings from Sri Lanka. It was made 
clear to importers and to the authorities of Sri Lanka that non co-operation may lead to 
the  application  of  Article  18  of  the  basic  Regulation.  These  parties  were  also  made 
aware of the consequences of non-cooperation.  

(b) PRC 

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

(12) 

It was made clear to these companies that non-cooperation may lead to the application 
of  Article  18  of  the  basic  Regulation.  These  parties  were  also  made  aware  of  the 
consequences of non-cooperation.  

2. 

Product concerned and like product 

(13)  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  94),  ex  7307  93  19  (TARIC  code 
7307  93  19  94),  ex  7307  99  30  (TARIC  code  7307  99  30  94)  and  ex 
7307 99 90 (TARIC code 7307 99 90 94).  

(14) 

In the absence of co-operation by any parties in Sri Lanka and considering the change 
in the pattern of trade as described in the following section, it must be inferred, in the 
absence  of  any  contrary  evidence,  that  the  tube  or  pipe  fittings  exported  to  the 
Community from  the PRC and  those consigned from Sri Lanka 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. 

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3. 

Change in the pattern of trade 

(15)  As stated in recital (4), the change in the pattern of the trade was alleged to stem from 

transhipment via Sri Lanka. 

(16)  As no Sri Lankan company co-operated in the investigation, exports from Sri Lanka 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 were therefore used to establish the export prices and quantities 
from Sri Lanka to the Community.  

(17) 

Imports of tube or pipe fittings from Sri Lanka increased from 0 tonnes in 2000 to 302 
tonnes  in  the  IP.  These  imports  from  Sri  Lanka  commenced  in  July  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  Sri  Lanka  were  compensating  for  some  of  the  previous 
imports from the PRC.  

(18)  From the figures above, it is concluded that there has been a clear change in the pattern 
of trade which started with the previous investigation leading to the imposition of the 
existing  measures  on  imports  of  the  product  concerned  originating  in  the  PRC  and 
rapidly developed after the imposition of these measures.  

4. 

Insufficient due cause or economic justification 

(19) 

In  the  absence  of  co-operation  by  any  parties  in  Sri  Lanka  or  the  PRC  and  of  any 
contrary evidence, it is concluded that, given the coincidence in time with the previous 
investigation which lead to the imposition of the existing measures, the change in the 
pattern  of  trade  stemmed  from  the  existence  of  the  anti-dumping  duty  imposed  on 
imports  of  the  product  concerned  originating  in  the  PRC  rather  than  from  any  other 
sufficient due cause or economic justification within the meaning of Article 13(1) of 
the basic Regulation. 

(20) 

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. 

4 

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

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5. 

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

(21)  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  Sri  Lanka  were  absent  of  the  Community 
market  until  June  2002.  After  said  date  imports  declared  as  originating  in  Sri  Lanka 
substantially increased, amounting to 302 tonnes during the IP. This volume represents 
0,6  %  of  the  Community  consumption  during  the  IP  of  the  previous  investigation. 
Attention  must  be  paid  to  the  fact  that  imports  of  the  product  concerned  into  the 
Community are very fragmented among a number of different exporting countries. In 
particular,  for  the  IP,  Sri  Lanka  held  2.5%  of  total  import  volumes  of  the  product 
concerned into the Community, whereas the most important exporting country during 
said  year  (the  Slovak  Republic)  held  12%.  In  addition,  Sri  Lanka  is  the  12th  most 
important importer of the product concerned into the Community, out of a list of 36 
exporting countries.  

(22)  With regard to prices of the products consigned from Sri Lanka and in the absence of 
co-operation and of any contrary evidence, Eurostat data revealed that average export 
prices of imports from Sri Lanka during the IP were lower than (i) the average export 
prices established for the PRC in the previous investigation; and (ii) the prices of the 
Community  industry.  It  has  been  established  that  prices  of  imports  from  Sri  Lanka 
were more than 12 % lower than the Chinese export prices during the IP. 

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

6. 

(24) 

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  Sri  Lanka  during  the  IP,  export 
prices established on the basis of Eurostat data were used pursuant to Article 18 of the 
basic Regulation.  

(25)  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  an  appropriate  market  economy  analogue 
country for the PRC for the purpose of establishing normal value. 

(26)  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 contained in the request 
was used.  

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(27) 

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 Sri Lanka. The dumping margin 
found,  expressed  as  a  percentage  of  the  CIF  price  at  the  Community  frontier,  duty 
unpaid, was 34,3 %. 

C. MEASURES 

(28) 

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 Sri Lanka, whether declared as originating in Sri Lanka or not. 

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

Regulation. 

(30) 

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  Sri  Lanka,  which  entered  the  Community  under  registration 
imposed by Article 2 of the initiating Regulation. 

(31)  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,  sales,  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.  

(32) 

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.  

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(33)  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.  

(34) 

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 abovementioned conclusions were received, 

HAS ADOPTED THIS REGULATION: 

Article 1 

1. 

The definitive anti-dumping duty imposed by Council 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 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 94), ex 7307 93 19 (TARIC code 7307 93 19 94), ex 7307 99 30 
(TARIC  code  7307  99  30  94)  and  ex  7307  99  90  (TARIC  code  7307  99  90  94) 
consigned from Sri Lanka, whether declared as originating in Sri Lanka or not. 

2. 

The  duty  extended  by  paragraph  1  of  this  Article  shall  be  collected  on  imports 
registered in accordance with Article 2 of Commission Regulation (EC) No 395/2004 
and Articles 13(3) and 14(5) of Council 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: 

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. 

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2. 

The  Commission,  after  consulting  the  Advisory  Committee,  may  authorise,  by 
decision,  the  exemption  of  imports,  which  are  shown  not  to  circumvent  the  anti-
dumping duty imposed by Regulation (EC) No 964/2003, from the duty extended by 
Article 1 of the present Regulation. 

Customs authorities are hereby directed to discontinue the registration of imports, established 
in accordance with Article 2 of Regulation (EC) No 395/2004. 

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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