Council Regulation (EC) No 258/2005 of 14 February 2005 amending the anti-dumping measures imposed by Regulation (EC) No 348/2000 on imports of certain seamless pipes and tubes of iron or non-alloy steel originating in Croatia and Ukraine
Date: 2005-02-14
Institutions: Council of the European Union
Subjects: Croatia, Ukraine, anti-dumping duty, anti-dumping legislation, piping, tube

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COUNCIL REGULATION (EC) No 258/2005

of 14 February 2005

amending the anti-dumping measures imposed by Regulation (EC) No 348/2000 on imports of
certain seamless pipes and tubes of iron or non-alloy steel originating in Croatia and Ukraine

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
(the ‘basic Regulation’) and in
imports from countries not members of the European Community (1)
particular Articles 11(3) and 11(7) thereof,

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

Whereas:

(1)

(2)

(3)

(4)

A. PROCEDURE

1. Previous investigation and existing measures

The measures currently in force on imports of certain seamless pipes and tubes of iron or non-alloy
steel originating in Croatia and Ukraine are definitive anti-dumping duties imposed by Council
Regulation (EC) No 348/2000 (2) and one undertaking accepted from an exporter in Croatia by
Commission Decision 2000/137/EC (3). The rate of duty applicable to imports from Croatia is
23 %, while the duty rate applicable to imports from Ukraine is 38,5 %.

2. Initiation

On 23 November 2002, the Commission announced by a notice of initiation published in the Official
the initiation of an interim review of the anti-dumping
Journal of
measures applicable to imports of certain seamless pipes and tubes, of iron or non-alloy steel
originating in Croatia and Ukraine and commenced an investigation.

the European Communities (4),

The investigation was initiated at the request lodged by the Defence Committee of the Seamless Steel
Tube Industry of the European Union on behalf of producers representing more than 75 % of the
total Community production.

It is to be noted that on the same date, 23 November 2002, another review was initiated concerning
the measures in force on imports of the same product, i.e. certain seamless pipes and tubes of iron or
non-alloy steel, originating in Poland, Russia,
the Czech Republic, Romania and the Slovak
Republic (5). The measures against Poland,
the Czech Republic and the Slovak Republic have
lapsed as a result of the enlargement of the European Union on 1 May 2004. Further to Regulation
(EC) No 1322/2004 (6), the existing measures on imports of certain seamless pipes and tubes
originating in Russia and Romania are temporarily not applied as from 21 July 2004. The review
on these measures is still ongoing.

(1) OJ L 56, 6.3.1996, p. 1. Regulation as last amended by Regulation (EC) No 461/2004 (OJ L 77, 13.3.2004, p. 12).
(2) OJ L 45, 17.2.2000, p. 1. Regulation as amended by Regulation (EC) No 1515/2002 (OJ L 228, 24.8.2002, p. 8).
(3) OJ L 46, 18.2.2000, p. 34. Decision as amended by Decision 2002/669/EC (OJ L 228, 24.8.2002, p. 20.)
(4) OJ C 288, 23.11.2002, p. 11.
(5) OJ C 288, 23.11.2002, p. 2.
(6) OJ L 246, 20.7.2004, p. 10.

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(5)

(6)

(7)

3. Parties concerned by the proceeding

The Commission officially advised the exporting producers in Croatia and Ukraine, the producers,
importers, suppliers and users in the Community known to be concerned and the authorities of
Croatia and Ukraine of the opening of the investigation. Interested parties were given an opportunity
to make their views known in writing and to request a hearing within the time limit set in the notice
of initiation.

The Commission sent questionnaires to all parties known to be concerned and to all the other
companies that made themselves known within the deadlines set out in the notice of initiation.
Replies were received from five Community producers, one importer, one exporting producer in
Croatia, three exporting producers in Ukraine and three traders related to the Ukrainian producers.

The Commission sought and verified all the information deemed necessary for a determination of
dumping and resulting injury and carried out verifications at
the following
companies:

the premises of

(a) Community producers:

— Dalmine Spa, Italy,

— Productos Tubulares SA, Spain,

— Tubos Reunidos SA, Spain,

— Vallourec & Mannesmann, Germany,

— Vallourec & Mannesmann, France;

(b) Unrelated importers in the Community:

— Comercial de Tubos SA, Spain;

(c) Exporting producer in Croatia:

— Mechel Željezara Ltd, Sisak;

(d) Exporting producers in Ukraine:

— CJSC Nikopolsky seamless tubes plant Nikotube, Nikopol,

— Dnipropetrovsk Tube Works (DTW), Dnipropetrovsk,

— OJSC Nizhnedneprovsky Tube Rolling Plant (NTRP), Dnipropetrovsk;

(e) Related traders in Ukraine:

— Time Ltd, Dnipropetrovsk,

— SGIP Interpipe, Dnipropetrovsk;

(f) Related trader in Switzerland:

— SEPCO, Lugano.

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4. Investigation period

(8)

The investigation of dumping and injury covered the period from 1 October 2001 to 30 September
2002 (the investigation period or IP). The examination of trends relevant for the assessment of injury
covered the period from 1 January 1999 to the end of
the investigation period (the period
considered).

5. Product concerned and like product

5.1. Product concerned

(9)

The products under review are:

(a) seamless pipes, of iron or non-alloy steel, of a kind used for oil and gas pipelines, of an external

diameter not exceeding 406,4 mm;

(b) seamless tubes of circular cross-section, of iron or non-alloy steel, cold-drawn or cold-rolled,

other than precision tubes;

(c) other tubes of circular cross-section, of iron or non-alloy steel, other than threaded or threadable,
of an external diameter not exceeding 406,4 mm, originating in Croatia and Ukraine (the product
concerned), falling within CN codes ex 7304 10 10, ex 7304 10 30, 7304 31 99, 7304 39 91
and 7304 39 93.

(10)

The investigation has shown that all these categories were sufficiently similar for them to constitute a
single product, as in the original investigation. Therefore, and for the purpose of the present anti-
dumping investigation, all types of the product concerned are regarded as one product.

5.2. Like product

(11) As in the previous investigation, no differences were found between the product concerned and the

seamless pipes and tubes produced and sold on the domestic market in Croatia.

(12)

Likewise, no differences were found between the product concerned and the seamless pipes and tubes
produced by the Community producers and sold on the Community market. They both share the
same physical and chemical characteristics and uses. Furthermore, they both conform to industry
standards such as DIN, API or ASTM. Therefore, they are considered as like products within the
meaning of Article 1(4) of the basic Regulation.

B. DUMPING

1. Croatia

1.1. Cooperation

(13) As concerns Croatia, one exporting producer, Mechel Željezara Ltd, accounted for all exports of the
product concerned to the Community. Mechel Željezara Ltd is the new name of the company which
investigation under the name Željezara Sisak d.d., but which had
cooperated with the original
officially changed its name twice since the imposition of the existing measures, due to subsequent
changes in ownership (1).

(14) During the original investigation, an undertaking had been accepted from Mechel Željezara Ltd under
its original name (2). As the investigation was initiated to review the level and form of the measures,
the undertaking was also subject to this review investigation (see recitals 135 to 137).

(1) Notice 246/02 (OJ C 246, 12.10.2002, p. 2) and Notice 68/06 (OJ C 68, 18.3.2004, p. 8).
(2) Commission Decision 2000/137/EC (OJ L 46, 18.2.2000, p. 34).

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(15)

(16)

1.2. Normal value
It was first established whether Mechel Željezara Ltd’s total domestic sales of the like product were
representative in comparison with its total export sales to the Community. In accordance with Article
2(2) of the basic Regulation, domestic sales were considered representative since the total domestic
sales volume represented at least 5 % of its total export sales volume to the Community.

Subsequently, by defining the product types in accordance with the CN codes under which the
product is classified, it was examined whether the domestic sales of each product type were repre-
sentative. Domestic sales of a particular product type were considered sufficiently representative when
the total domestic sales volume of that type during the IP represented 5 % or more of the total sales
volume of the comparable product type exported to the Community. It was found that all product
types sold by the company for export to the Community had representative domestic sales.

(17) An examination was also made as to whether the domestic sales of each product type could be
regarded as having been made in the ordinary course of trade, by establishing the proportion of
profitable sales to independent customers of the type in question. In cases where the sales volume of
a product type, sold at a net sales price equal to or above the unit cost, represented more than 80 %
of the total sales volume of that type, and where the weighted average price of that type was equal to
or above the unit cost, normal value was based on the actual domestic price, calculated as a weighted
average of the prices of all domestic sales of that product type made during the IP, irrespective of
whether these sales were profitable or not. This was the case for two product types.

(18)

(19)

(20)

(21)

In the case where the volume of profitable sales of a product type represented 80 % or less but at
least 10 % of the total sales volume of that type, or where the weighted average price of such sales
was below the unit cost, normal value was based on the actual domestic price, calculated as a
weighted average of profitable sales of those types only. This was the case for one product type.

For the fourth product type, less than 10 % of the domestic sales volume was profitable during the IP.
It was therefore considered that this particular product type was sold in insufficient quantities for the
domestic prices to provide an appropriate basis for the establishment of the normal value and
another method had to be applied. In this case, constructed normal value was used, in accordance
with Article 2(3) of the basic Regulation. Normal value was constructed by adding to the manufac-
turing cost of the exported type, adjusted where necessary, a reasonable percentage for selling, general
and administrative expenses (SG&A) and a reasonable margin of profit, on the basis of actual data
in the ordinary course of trade, of the like product, by the
pertaining to production and sales,
exporting producer under investigation in accordance with the first sentence of Article 2(6) of the
basic Regulation.

1.3. Export price
The investigation showed that the export sales of Mechel Željezara Ltd were solely made directly to
unrelated customers in the Community.

Therefore, the export price was established on the basis of export prices actually paid or payable for
the product concerned when sold to the first independent customer in the Community, in accordance
with Article 2(8) of the basic Regulation.

1.4. Comparison

(22)

The normal value and export price were compared on an ex-works basis. For the purpose of ensuring
a fair comparison between the normal value and the export price, due allowance in the form of
adjustments was made for differences affecting price comparability in accordance with Article 2(10)
of the basic Regulation.

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(23) Accordingly, allowances claimed for differences in transport costs, handling, loading and ancillary
costs, credit costs and commissions were granted where applicable and supported by verified
evidence.

1.5. Dumping margin

(24)

In accordance with Article 2(11) of the basic Regulation, the adjusted weighted average normal value
by product type was compared with the adjusted weighted average export price of each corre-
sponding type of the product concerned.

(25)

This comparison showed the existence of dumping. The dumping margin expressed as a percentage
to the cif Community frontier price, duty unpaid, is as follows:

Mechel Željezara Ltd.

38,9 %.

(26)

This dumping margin is below the dumping margin found during the original investigation. Since the
level of cooperation was high (all exports of the product concerned from Croatia to the Community),
the residual dumping margin was set at the same level as the one established for Mechel Željezara
Ltd, namely 38,9 %.

2.1. Market economy treatment (MET)

2. Ukraine

(27)

Pursuant to Article 2(7)(b) of the basic Regulation, in anti-dumping investigations concerning imports
originating in Ukraine, normal value is to be determined in accordance with paragraphs 1 to 6 of the
said Article for those exporting producers which can show that they meet the criteria laid down in
Article 2(7)(c) of that Regulation,
in respect of the
manufacture and sale of the like product.

i.e. that market economy conditions prevail

(28)

Briefly, and for ease of reference only, the criteria for MET are set out in summarised form below:

1. business decisions and costs are made in response to market signals, and without significant State

interference;

2. firms have one clear set of accounting records which are independently audited in line with

international accounting standards (IAS) and are applied for all purposes;

3. there are no significant distortions carried over from former non-market economy system;

4.

legal certainty and stability is provided by bankruptcy and property laws;

5. currency exchanges are carried out at market rate.

(29)

Claims for MET pursuant to Article 2(7)(b) of the basic Regulation were received from two groups of
companies:

(a)

the producing company Dnipropetrovsk Tube Works (DTW) and its related trader in Ukraine,
Time Ltd.;

(b) the related producing companies OJSC Nizhnedneprovsky Tube Rolling Plant (NTRP) and CJSC
Nikopolsky seamless tubes plant ‘Nikotube’ and their related trader in Ukraine, SGIP Interpipe.

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(30)

The claims were analysed on the basis of the five criteria set out in Article 2(7)(c) of the basic
Regulation.

(31)

(32)

In the case of the first group, the accounts of the producing company were found to be unreliable
due to material inaccuracies and to the misapplication of accounting policies referred to in IAS 1. It
was also found that the same company was in an insolvent situation and belonged to a category of
companies which, by bankruptcy law provision, enjoyed a special status which denied legal certainty
for the operation of such companies. It was therefore determined that this group of companies did
not meet the second and fourth criteria of Article 2(7)(c) of the basic Regulation.

In the case of the second group, it was found that neither producing company had one clear set of
basic accounting records which were independently audited in line with international accounting
standards and which were applied for all purposes as both companies had several sets of basic
accounting records used for different purposes. Additionally, significant distortions carried over
from the former non-market economy system in the form of interest free loans not pursued by
the State, debt forgiveness of considerable amounts and tax indebtedness were found to affect the
cost structure and the financial situation of the group. It was therefore determined that this group of
companies did not meet the second and third criteria of Article 2(7)(c) of the basic Regulation.

(33) As a company or a group of companies has to fulfil all of the five criteria of Article 2(7)(c) of the
basic Regulation in order to have Market Economy Treatment granted to them and this not being the
case, both groups of companies were refused MET.

(34)

Both groups of companies argued that the Commission had made a determination regarding its
application for MET beyond the three month period mentioned under Article 2(7)(c) of the basic
Regulation, and that this determination was therefore not valid. In this respect it is noted that the
Commission granted several extensions to the deadline to the Ukrainian exporting producers
concerned which had major difficulties in filling in the MET claim forms within the deadline set
in the notice of initiation. It is also noted that the MET claims received were deficient and required a
number of substantial clarifications and additional
information which delayed the investigation.
Finally, the complexity of a number of issues such as the companies' structures and sales channels
as well as the serious problems with regard to the companies' accounts prolonged the analysis. In
view of this, it was not possible to make a determination regarding the MET claims received within
three months from the initiation.

(35)

In this respect it is noted that the non-respect of such deadline does not entail any apparent legal
consequences as companies have equally been granted the opportunity to comment. Furthermore, it
is noted that the abovementioned groups of companies did not claim any negative impact due to the
longer period needed for the MET determination.

(36) Given the above, it is concluded that a valid determination with regard to MET can be made even
after the three month period and the claims of the groups of companies concerned were therefore
rejected.

(37)

The Commission findings were further contested by both groups of companies; however, no
arguments were brought forward to alter the MET determination.

(38)

The Community industry was given the opportunity to comment and did not oppose the above
findings.

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2.2. Individual treatment

(39)

(40)

(41)

(42)

(43)

(44)

is established for
Pursuant to Article 9(5) of the basic Regulation, a country-wide duty,
countries falling under Article 2(7)(a) of
in those cases where
companies are able to demonstrate that their export prices and quantities as well as the conditions
and the terms of sales are freely determined, that exchange rates are carried out at market rates, and
that any State interference is not such as to permit circumvention of measures if exporters are given
different rates of duty.

the basic Regulation, except

if any,

The same Ukrainian exporting producers, which did not fulfil the MET criteria, alternatively requested
individual treatment (IT) in accordance with Article 9(5) of the basic Regulation. The Commission
consequently sought and verified all information deemed necessary for the purposes of determining
whether the two groups of companies qualified for IT. It was found that the conditions as set in
Article 9(5) of the basic Regulation were fulfilled by both groups of companies and it was therefore
considered justified to grant IT to both groups of companies.

2.3. Analogue country

Pursuant to Article 2(7)(a) of the basic Regulation, normal value for the exporting producers that
were not granted MET has to be established on the basis of the prices or constructed value in an
appropriate analogue country for products comparable to those exported by the Ukrainian exporting
producers to the Community.

Croatia was the analogue country used in the original investigation. In the notice of initiation, Croatia
was again envisaged as the analogue country for the purpose of establishing normal value for
Ukraine. As none of the interested parties objected to this choice, it was decided to use Croatia as
an analogue country in the framework also of this investigation.

2.4. Normal value

Pursuant to Article 2(7)(a) of the basic Regulation, normal value for Ukraine was established on the
basis of verified information received from the sole producer in the analogue country, i.e. on the
basis of all prices paid or payable on the domestic market of Croatia for comparable product types or
constructed value in Croatia for comparable product types. In determining normal value for Ukraine,
the same methodology as that described at recitals 15 to 19 was applied.

It was established that for the product type corresponding to CN code 7304 31 99 (cold-drawn or
cold-rolled tubes), there was no domestic production in Croatia. Overall, these exports accounted for
only 6,2 % of the Ukrainian exports of the product concerned to the Community. However, in the
case of one group of companies, during the IP the exported quantity to the Community of this
product
the product concerned to the
Community.

type represented around 40 % of

its total exports of

(45) On the basis of data available, it was concluded that the other product types subject to the inves-
tigation were not comparable to this product type and that constructing normal value for this
particular product type on the basis of normal value for the other product types would not lead
to a reliable figure. It also appeared, because of a more complex manufacturing process, that normal
value of this product type would be considerably higher than normal value of the other product
types. Although export prices of cold-drawn or cold-rolled tubes were on average higher than export
prices of the other product types, inclusion of this product type in the calculations would, in all
likelihood, lead to a higher dumping margin. Insofar as mentioned in recital 127, the injury margin is
type, and
significantly lower than the dumping margin found without
therefore will serve as a basis for establishing the level of the measures. In view of this,
it was
not considered necessary to pursue this matter further. The product type corresponding to CN code
7304 31 99 was therefore excluded from the calculations.

including this product

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(46)

(47)

2.5. Export price

Both groups of companies in Ukraine made all their export sales to the Community via a related
trading company located in a third country. The export price was, therefore,
in accordance with
Article 2(9) of the basic Regulation, constructed on the basis of the related trading companies' resale
prices to the first independent customers in the Community.

2.6. Comparison

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 were claimed and demonstrated to affect
price comparability. These adjustments were made, where appropriate, in accordance with Article
2(10) of the basic Regulation in respect of transport, insurance, handling, loading and ancillary costs
and commissions. The adjustments in the export price in respect of inland transport in the exporting
country, insurance, loading and ancillary costs were made on the basis of costs established in the
analogue country.

(48)

The comparison between normal value and export price was made on an ex-works basis.

2.7. Dumping margin

(49) According to Article 2(11) of the basic Regulation, the adjusted weighted average normal value by
product type, taken from the analogue country producer Mechel Željezara Ltd, was compared with
the companies' adjusted weighted average export price of each corresponding product type of the
product concerned.

(50)

This comparison showed the existence of dumping. The dumping margins expressed as a percentage
to the cif Community frontier price, duty unpaid, are as follows:

Dnipropetrovsk Tube Works, Dnipropetrovsk

91,0 %

OJSC Nizhnedneprovsky Tube Rolling Plant, Dnipropetrovsk and CJSC Nikopolsky
seamless tubes plant ‘Nikotube’, Nikopol

97,3 %.

(51)

Since the level of cooperation was high (more than 80 % of the exports of the product concerned
from Ukraine to the Community), the residual margin was set at the same level as the one established
for the cooperating exporting producers OJSC Nizhnedneprovsky Tube Rolling Plant (NTRP) and
CJSC Nikopolsky seamless tubes plant ‘Nikotube’, namely 97,3 %.

C. INJURY

1. Preliminary remark

(52) As in the case of dumping, the investigation sought to establish whether the circumstances with
regard to the situation of the Community industry had changed to such an extent that would warrant
a conclusion different to that established during the original investigation.

(53) During the original investigation, the Community industry was composed of 10 producers.

2. Community production

(54)

In the course of the present review investigation it was found that seamless pipes and tubes were
manufactured by

— six complainant Community producers, of which five fully cooperated with the Commission
during the investigation, whereas the sixth, Pietra, Italy, supported the proceeding, but did not
provide a detailed questionnaire reply,

— six other producers, which neither supported the Community industry nor cooperated with the

Commission.

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(55) A questionnaire was sent to these other producers but no cooperation was obtained. No further
producers of the product concerned made themselves known to the European Commission.

3. Definition of the Community industry

(56)

The production of the five Community producers that fully cooperated in the investigation was
797 456 tonnes during the investigation period. This represents over 70 % of total Community
production and these companies therefore constitute the Community industry within the meaning
of Articles 4(1) and 5(4) of the basic Regulation.

(57)

(58)

4. Community consumption

Eurostat information, related to volumes and values for CN codes ex 7304 10 10, ex 7304 10 30,
7304 31 99, 7304 39 91 and 7304 39 93 was used as the source of the import data. Community
industry data were obtained from the verified questionnaire responses of
the five cooperating
Community producers.

The apparent Community consumption, i.e. sales by the Community industry on the Community
market and sales of other Community producers in the Community, as well as imports from all third
countries, shows that consumption of the product concerned in the Community increased from
1 104 619 tonnes in 1999, to a peak of 1 233 357 tonnes in 2001. Consumption decreased to
1 103 805 tonnes during the IP, which is slightly less than the consumption in 1999.

Community consumption (tonnes)

1 104 619

1 130 410

1 233 357

1 103 805

Index 1999 = 100

100

102

112

100

1999

2000

2001

IP

5. Imports into the Community from the countries concerned

5.1. Cumulative assessment of the effects of the imports concerned

(59)

It was first examined whether imports from Croatia and Ukraine should be assessed cumulatively, in
accordance with Article 3(4) of the basic Regulation.

(60)

The evolution of imports from the countries concerned, in volume and market share, has been the
following:

Import volumes (tonnes)

1999

2000

2001

IP

Ukraine

Index 1999 = 100

Croatia

Index 1999 = 100

103 477

22 996

37 353

37 683

100

22

36

36

30 072

24 646

23 893

23 001

100

82

79

76

Countries concerned Total

133 549

47 642

61 246

60 684

Index 1999 = 100

100

36

46

45

Market shares of the imports

Ukraine

Croatia

Countries concerned Total

Imports from other countries

1999

9,4 %

2,7 %

12,1 %

24,1 %

2000

2001

2,0 %

2,2 %

4,2 %

3,0 %

1,9 %

5,0 %

IP

3,4 %

2,1 %

5,5 %

27,5 %

31,2 %

29,9 %

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(61)

(62)

It was found that the dumping margins established (recitals 25 and 50) in relation to the imports
from each of the countries concerned were above the de minimis threshold as defined in Article 9(3)
of the basic Regulation. Additionally, despite the measures in force, the volumes of imports from
each of these countries were not negligible during the investigation period, as market shares for these
countries were 2,1 % for Croatia and 3,4 % for Ukraine. The shares of all imports ranged from 5,9 %
for Croatia to 9,6 % for Ukraine in the IP.

The cumulative assessment was found to be appropriate in view of the conditions of competition
both between imports originating in these countries, and between these imports and the like
Community product. This is evidenced by the fact that, again despite the measures in force, prices
from both countries have continued to significantly undercut the prices of the Community industry
during the IP and that seamless pipes and tubes from both countries are sold through similar sales
channels. Moreover, the investigation has shown that the imports from both countries concerned
share the same physical and chemical characteristics, as the like product. Finally, the imports of both
countries concerned and the like product follow the same price trends (see recitals 67 and 74).

(63) One Croatian exporter claimed that no injury is caused by the Croatian imports since Croatian
market share is minimal and therefore no cumulative assessment should take place. As stated
above, the Croatian imports were clearly above de minimis and not negligible during the IP. While
it is true that there was a considerable drop of imports originating in Ukraine at the beginning of the
period considered,
it should be noted that subsequently imports from both countries followed a
broadly similar trend.

(64)

For these reasons, it is concluded that all the criteria set out in Article 3(4) of the basic Regulation are
met and that imports originating in Croatia and Ukraine should be assessed cumulatively.

5.2. Market share of imports concerned

(65) As shown above, following the introduction of measures in 2000, the market share of imports from
the countries concerned decreased significantly from 12,1 % in 1999 to 4,2 % in 2000 and then
started to increase continuously up to 5,5 % in the IP.

5.3. Prices of imports and undercutting

(66) A comparison of selling prices on the Community market during the IP was made between the prices
of the Community industry and those of the exporting producers in the countries concerned. This
comparison was made after deduction of rebates and discounts. The prices of the Community
industry were adjusted to ex-works prices, and the prices of the imports were cif Community
import duty paid, anti-dumping duty unpaid, with adjustments made for the level of
frontier,
trade and handling costs, based on information collected during the investigation, notably from
cooperating unrelated importers.

(67)

imports of the product concerned were sold in the
The comparison showed that during the IP,
the Community industry’s prices, when expressed as a
Community at prices which undercut
percentage of the latter, as follows: Ukraine 34,1 % and Croatia: 23,3 %. Even if the anti-dumping
duties are taken into account, undercutting is still significant with 10 % for imports from Ukraine and
6,5 % for imports from Croatia. It has to be noted that average prices of the imports increased from
2000 up to the IP as shown below, which is in line with the overall price developments on the EU
market. However, as shown in recital 74, prices of imports from the countries concerned did not
increase as much as the prices of the Community industry.

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Prices of imports, duty unpaid (Eur/tonne)

1999

2000

2001

Ukraine

Index 1999 = 100

Croatia

Index 1999 = 100

Ukraine and Croatia Average

Index 1999 = 100

332

100

461

100

361

100

341

103

465

101

405

112

433

130

516

112

466

129

IP

449

135

523

113

477

132

6. Situation of the Community industry

(68)

In accordance with Article 3(5) of the basic Regulation, the examination of the impact of the dumped
imports on the Community industry included an evaluation of all economic factors and indices
having a bearing on the state of the industry from 1999 (base year) to the IP.

(69)

The Community industry data below represent the aggregated information of the five cooperating
Community producers.

6.1. Production, production capacity and capacity utilisation

(70)

The evolution of production, production capacity and capacity utilisation is as follows:

Production (tonnes)

Index 1999 = 100

1999

2000

2001

IP

710 029

911 669

928 231

797 456

100

128

131

112

Production capacity (tonnes)

1 117 881

1 183 067

1 140 304

1 094 548

Index 1999 = 100

Capacity utilisation

Index 1999 = 100

100

63,5 %

100

106

77,1 %

121

102

81,4 %

128

98

72,9 %

115

(71) As shown in the table above, production during the period 1999 to 2001 increased to a peak in
2001 and then decreased significantly during the IP. Although export
increased and
compensated to some extent for the decrease of sales in the Community, the reduction in the
production and the decrease in the production capacity during the IP could not be avoided.

sales

6.2. Stocks

(72)

The figures below represent the volume of stocks at the end of each period.

Stocks (tonnes)

Index 1999 = 100

1999

2000

2001

IP

38 753

49 620

49 062

59 287

100

128

127

153

(73)

Stocks have increased during the period considered. It is to be noted that the Community industry
generally produces the product concerned to order. Consequently, the level of stocks held by the
Community industry is found not to be a very significant indicator in the assessment of the situation
of the Community industry. However, it was found that the increase in stocks is also a consequence
of the decreasing sales and market share of the Community industry.

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6.3. Sales volume, market shares, growth and average unit prices in the Community

(74)

The figures below represent
Community.

the Community industry's sales to independent customers in the

Sales volume (tonnes)

516 529

573 136

576 850

504 317

1999

2000

2001

IP

Index (1999=100)

Market share

Index (1999=100)

Average sales prices (EUR/tonne)

Index (1999=100)

100

46,8 %

100

576

100

111

50,7 %

108

589

102

112

46,8 %

100

659

114

98

45,7 %

98

696

121

(75)

(76)

The Community industry's sales volumes increased by 12 % from 1999 to 2001 and then dropped
down significantly during the IP to a level even below that in 1999. The development in sales
volumes should be seen in the light of the level of consumption during the same period, which
increased by 12 % from 1999 to 2001 and then decreased during the IP. However, the demand did
not decrease as much as the sales volume between 2001 and the IP.

Following the introduction of measures in 2000, the Community industry was able to regain lost
market share. Between 1999 and 2000, the market share of the Community industry increased from
46,8 % to 50,7 % of Community consumption. However, following this period of relative strength,
the market share of the Community industry decreased again. Between 2000 and the IP, its share of
Community consumption decreased to 45,7 % as dumped imports started again to penetrate the
Community market.

(77)

Facing increasing imports as from 2000 on and decreasing Community sales from 2001 on, the
Community industry could not increase the production of the product concerned. Rather were they
forced to reduce production capacity and work force in the IP, as increasing exports of
the
Community industry could not compensate the loss of sales on the Community market.

(78)

The Community industry's average sales prices increased in the period considered. However, the
higher prices could not generate sufficient profitability, as described in detail below.

6.4. Profitability

(79)

The profit concept used below is profit before taxes, which represents the profit generated by sales of
the product concerned on the Community market.

Profitability on EC Sales

1999

– 7,8 %

2000

0,1 %

2001

0,3 %

IP

– 0,1 %

(80)

Following the imposition of anti-dumping measures against imports of seamless pipes and tubes
originating in Croatia and Ukraine, the Community industry could, as seen above, increase the prices
to reach around break-even in 2000 and 2001. However, the Community industry could not reach
the level of profit which it could be expected to achieve in the absence of dumped imports (i.e. 5 %)
as set out in the Regulation imposing the measures currently in force. Moreover, the level of profit
decreased during the IP below break-even. The reason for this decrease despite the higher sales prices
were increasing raw material and labour costs per unit, which went up despite the reduction of
employees during that time. The Community industry was not able to pass on those costs to its
customers as would have been necessary due to the competition caused by the low priced dumped
imports.

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(81)

Following a slightly positive trend in 2000 and 2001, the financial situation of the Community
industry started to deteriorate again during the IP, coinciding with increases of dumped imports from
Croatia and Ukraine. The profit level reached in 2001 was just above break-even, and was far from
the level that would allow financing sufficiently reinvestment.

6.5. Return on investments, cash flow, investments and ability to raise capital

(82)

The trends for the Return on Investments, the Cash flow and the Investments are shown in the
following table.

Return on investments

Index 1999 = 100

Cash flow

Index 1999=100

Investments

Index 1999=100

1999

– 13 %

100

2000

0 %

202

2001

1 %

204

IP

0 %

198

– 13 978 142

5 273 981

5 910 373

4 959 440

100

238

242

235

19 320 730

32 691 925

33 056 929

21 087 534

100

169

171

109

(83)

It is noted that the above figures for Return on Investments reflect to a large extent those on
profitability. The Return on Investments increased from 1999 to 2000 but decreased again up to
the IP. The Cash Flow shows approximately the same trend as the profitability, namely a peak in
2001 and then a decrease again. Insofar as the product concerned accounts for less than 1 % of total
turnover of the Community producers and the Community producers also use their production lines
for the manufacturing of a variety of other steel products, it is considered that these figures are not
meaningful in themselves. However, they are illustrative, in that two of the cooperating Community
producers which produced the product concerned to a much higher extent than other Community
producers show trends similar to the ones indicated in the table above regarding Return on
Investments, Cash Flow and Investments.

(84)

Following the imposition of anti-dumping measures in 2000, the Community industry made some
investments. However, these investments were found to be in the majority aimed at the replacement
of machinery. In the IP, investments decreased significantly compared to the preceding two years.

(85)

The Community industry's ability to raise capital, either from external providers of finance or parent
companies, was nevertheless not seriously affected during the period considered as the product
concerned accounts for less than 1 % of total turnover of the Community producers and the
Community producers also use their production lines for the manufacture of a variety of other
steel products.

6.6. Employment, productivity and wages

Number of employees

Index 1999=100

Productivity (tonne/employee)

Index 1999 = 100

Wages Index 1999=100

1999

2 583

100

275

100

100

2000

2 776

107

328

119

104

2001

2 622

102

354

129

106

IP

2 472

96

323

117

105

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(86) As seen above, the Community industry increased its productivity and the number of employees in
2000 and 2001 as production increased during that period. However,
in the IP, the number of
employees was reduced significantly to a level below that in 1999. Productivity also decreased
following the substantial decrease in production.

(87) Wages were relatively stable during the period considered, and merely moved in line with inflation.

6.7. Recovery from past dumping

(88)

Following the introduction of measures in 2000, the Community industry was able to regain lost
market share and reach a more sustainable level in its average sale prices. Nevertheless, from 2001
on, the Community industry's financial performance started to deteriorate again. Therefore, it can be
concluded that the Community has not recovered from past dumping.

6.8. Magnitude of the actual margin of dumping

(89)

The dumping margins are specified in the dumping part (recitals 25 and 50). These margins estab-
lished are clearly above de minimis. Furthermore, given the volume and the price of the dumped
imports, the impact of the actual margin of dumping cannot be considered to be negligible.

6.9. Conclusion on injury

(90)

It is recalled that, following the imposition of anti-dumping measures against imports of the product
concerned from Croatia and Ukraine,
the Community industry immediately gained confidence.
Average prices of
its Community sales increased by 14 % between 1999 and 2001 and sales
volumes in the Community as well as production increased in the same period. In consequence,
the industry could make some necessary investments at that time and employed more work force.

(91) However, the situation started to deteriorate substantially in the IP. Sales in the Community decreased
by 12 % from 2001 to the IP and the Community industry had to adjust significantly by reducing
production, production capacity and employment. The market share of the Community industry
decreased further from 2001 to the IP to a level below that in 1999. The declining trend in the IP is
also confirmed by the reduced capacity utilisation, the stagnating development of the wages and the
increased level of stocks leaving the industry in a situation similar to that in 1999 when measures
had not yet been imposed against imports from the countries concerned.

(92)

The same trend is shown by the development of investments, return on investments and cash flow.
The minor improvement in 2000 and 2001, which was far from being very satisfying as the return
on investments reached only 1 % and the negative cash flow which had just turned towards positive,
is followed by a deterioration in the IP. The fact that the ability of the companies to raise capital was
not seriously affected is due to those companies being part of
larger corporate groups and,
accordingly, cannot be considered as a viable indicator for the sector of the product concerned.

(93)

In regard to the Community industry's financial situation, it improved from a loss-making situation
in 1999, but only to reach a more or less break-even situation in 2000 and 2001 and fell back into a
loss-making situation again in the IP.

(94) As can be seen above, the indicators improved initially after 1999 when measures were imposed but
all of them with the exception of the sales prices deteriorated again in the IP showing a clear
injurious picture.

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(95)

The continuous increase in selling prices which occurred during the whole period considered, could
not lead to a satisfying profit situation as it was completely absorbed by rising production costs,
notably raw material costs and labour costs per unit. Moreover, the Community industry was not
able to pass on these cost increases to the customer as much as would have been necessary because
In consequence, the profit situation of the
low priced dumped imports penetrated the market.
Community industry deteriorated and fell below break-even in the IP.

(96)

In view of the above, it is concluded that the Community industry has still suffered material injury
during the IP within the meaning of Article 3 of the basic Regulation.

D. LASTING NATURE OF CHANGED CIRCUMSTANCES AND LIKELIHOOD OF CONTINUATION OF

DUMPING AND INJURY

(97)

The original measures were to expire on 18 February 2005. In accordance with Article 11(7) of the
basic Regulation, it was therefore examined whether the expiry of the existing measures would be
likely to lead to a continuation of dumping and injury. In accordance with Article 11(3) of the basic
Regulation, it was also analysed whether the circumstances with regard to dumping and injury have
changed significantly, and if this change could reasonably be said to be of a lasting nature.

(98)

It was found that the product concerned was still dumped on the Community market during the IP
(recitals 25 and 50). In this regard, the dumping margins for the product concerned originating in
each of the countries subject to the proceeding were close to the dumping margins found in the
original investigation. Moreover, there are still huge production capacities in the countries concerned,
which were not used during the IP. It was also noted that there were still significant quantities of
imports from Croatia and Ukraine sold on the Community market and that their market share has
continuously increased since 2000. This demonstrates a clear interest by Croatian and Ukrainian
exporters in the EU market. Given all of the above, it is considered that there is no reason to doubt
that the level of dumping found is of a lasting nature and a continuation of dumping is highly likely
if the original measures were allowed to expire.

(99) Despite the fact that the Community industry recovered to a certain extent from past dumping of
imports originating in, inter alia, Croatia and Ukraine, it was also found that the Community industry
injury within the meaning of Article 3 of the basic Regulation. The injury
still suffered material
margins found in the investigation have increased as compared to the original investigation because
the dumped imports continued to substantially undercut the Community industry's prices and this
despite the fact that costs have risen worldwide. Considering the effects of the dumped imports on
profitability (recital 79) and market share of the Community industry (recital 74), which were again
decreasing from 2001 to the IP, it is concluded that the circumstances leading to injury are of a
lasting nature and that the expiry of the original measures would be likely to lead to the continuation
of injury.

E. CAUSATION

(100)

It was also examined whether the causal link between the dumped imports from Croatia and Ukraine
and the injury suffered by the Community industry, which has been established in the previous
investigation is still present in this investigation. Known factors other than the dumped imports,
which could at the same time have injured the Community industry, were also examined to ensure
that the possible injury caused by these other factors was not attributed to the dumped imports.

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(101) Despite the measures in force, which first led to a reduction of imports in 2000, the exporting
producers from Croatia and Ukraine subsequently increased their market share in the Community
from 4,2 % up to 5,5 % during the period considered. Even with decreasing consumption from 2001
to the IP, they saw an increase of their market share. At the same time, from 2000 to the IP, the
Community industry lost market share. It had to reduce production substantially in the IP and
suffered from declining profitability. The increasing imports from the countries concerned, which
significantly undercut Community industry's prices and the deteriorating situation of the Community
industry coincide in time. Therefore, those imports could have continued to contribute to the injury
suffered by the Community industry.

(102)

Imports originating in other third countries, such as the Czech Republic, Poland and the Slovak
Republic, which were during the investigation period not yet members of the Community, as well as
imports from Romania or Russia could also have contributed to the injury suffered by the
Community industry.

(103)

It has to be noted that anti-dumping duties ranging from 9,8 % to 38,2 % and undertakings were in
force for imports from the abovementioned five countries during the whole period considered. There
is a review currently ongoing on the measures in force on imports from Russia and Romania
(recital 4).

(104)

Imports from Russia accounted for a market share of 3,3 % during the investigation period. The
average import prices of these imports inclusive of anti-dumping duties were around 20 % lower than
the prices of the imports from Croatia and Ukraine. Given the level of prices of imports from Russia,
these imports seem to have contributed to the injury. However, having regard to the size of the
market share, which is lower than that of the countries concerned, Russian imports cannot have been
the only cause for the injury suffered by the Community industry. Imports from Romania accounted
for a market share of 3,5 % in the IP. Import prices from Romania, inclusive of anti-dumping duties
are higher than the prices of the imports from Croatia and Ukraine, but still
lower than the
Community industry's prices. From this, it can be concluded that they could also have contributed
to injury suffered by the Community industry. However, it is considered that any possible effect of
imports from Russia and Romania would not be such as to alter the finding that there is a genuine
and substantial causal link between the dumped imports of seamless pipes and tubes from Croatia
and Ukraine and the material injury suffered by the Community industry.

(105) Prices for imports from the former accession countries Poland, the Czech Republic and Slovakia were,
inclusive of anti-dumping duties, also at a significantly higher level than those from Croatia and
Ukraine, but still lower than the Community industry's prices. Their market share altogether in the IP
was 14,2 %. Although those imports could also have contributed to the injury, it can be concluded
from their price level that their contribution could have been only a minor one.

(106) Having regard to the fact

that

imports from Croatia and Ukraine undercut substantially the
Community industry prices, there is no indication that the abovementioned imports, which in the
majority undercut the Community prices to a lesser extent, could break the causal link between the
dumped imports from Croatia and Ukraine and the material
injury suffered by the Community
industry.

(107)

Imports from several other third countries altogether accounted for 8,9 % market share in the IP.
With regard to their high level of prices which are in the majority sufficiently above the Community
industry prices, there is no indication that those imports could break the causal link between the
dumped imports from Croatia and Ukraine and the material
injury suffered by the Community
industry.

(108) Other Community producers, which did not cooperate in the investigation were facing the same
problems as regards the increasing raw material costs forcing them to raise prices as much as
possible. No indication has been found that
those competitors could have caused the injury
suffered by the Community industry.

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(109) There is a decreasing consumption in the Community as from 2001 on. However, Community sales
decreased to a higher percentage than the consumption and Community industry lost market share
while the countries concerned increased their market share on the Community market in that period.
Therefore,
link between the dumped
injury suffered by the Community industry.
imports from Croatia and Ukraine and the material
No other factors have been found in the course of the investigation that could have caused injury.

it is concluded that this factor could not break the causal

(110) Based on the above analysis of the effects of all known factors on the situation of the Community
industry, it is concluded that the causal link between the dumped imports from Croatia and Ukraine
and the material
injury to the Community industry, which has been established in the previous
investigation, has not been broken.

F. COMMUNITY INTEREST

1. General considerations

(111)

It has been examined whether compelling reasons exist that could lead to the conclusion that it
would not be in the Community interest to maintain the anti-dumping duties against imports from
the countries concerned. The Commission sent questionnaires to importers and industrial users. A
complete questionnaire reply was received from one importer, Comercial de Tubos, SA, Spain.

(112) From the user industry, no questionnaire replies were received. No supplier has made itself known
during the investigation. On the basis of the information received from the cooperating parties, the
following conclusions are reached.

(113)

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 that the present investigation is a
review, thus analysing a situation in which anti-dumping measures have already been in place, allows
the assessment of any undue negative impact on the parties concerned by the current anti-dumping
measures.

2. Interest of the Community industry

(114)

It is recalled that the Community industry consisted of five producers which employ approximately
2 470 staff for the production and sales of seamless pipes and tubes. It is also recalled that the
economic indicators of the Community industry above showed deteriorating financial results during
the investigation period. Despite the growing consumption of seamless pipes and tubes in the
Community in 2000 and 2001, which was, however, again declining in the IP, the Community
industry could not gain financial stability.

(115)

Indeed, the industry recovered partially in 2000 to 2001. However, given the prevailing financial
situation for the Community industry, it is clear that anti-dumping measures would be in the interest
of the Community industry.

3. Interest of unrelated importers

(116) The cooperating importer did not generally oppose the continued imposition of anti-dumping
measures. No other comments from importers, which imported the product concerned from
Croatia or Ukraine, were received.

(117) The purpose of the anti-dumping measures is to restore fair trade. It is neither to prohibit imports
nor to hamper the activities of the importers in the Community.
In fact, any measures to be
proposed are to be set at a level which will enable the continuation of imports also in future, but
at prices that are non-dumped or non-injurious, whichever is the lower.

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(118) As fairly-priced imports will still be allowed to enter into the Community market, it is likely that the
traditional business of the importers will continue even if anti-dumping measures against dumped
imports are imposed.

4. Interest of suppliers

(119) No supplier made himself known during the investigation. Therefore,

is concluded that no
compelling reason exists that measures should not be imposed as regards the suppliers' interests.

it

5. Interest of users

(120)

In the previous investigation,
it was concluded that any price effect resulting from anti-dumping
measures would not be significant with respect to downstream industrial users. This was based on the
fact that seamless pipes and tubes represented only a small element in the overall costs of the user
industries (including the chemical and petrochemical industries, power stations, the automobile and
construction industries). Given that no representations have been made contradicting the previous
findings and in view of the lack of cooperation of users in the present investigation, it is expected
that any price effect resulting from anti-dumping measures would be negligible with respect to
downstream industrial users.

6. Competition aspects

(121)

in Commission Decision 2003/382/EC (1),
It should be noted that
it was found that some
Community producers were involved in an anti-competitive agreement on parts of the product
concerned until 1995. Accordingly, neither the original investigation with an IP from 1 November
1997 until 31 October 1998 (and with a period considered from January 1997 until the end of the
IP), nor the current review investigation were affected by any anti-competitive practices.

7. Conclusion on Community interest

(122) The maintenance of measures against

imports of seamless pipes and tubes originating in the
countries concerned would clearly be in the interest of the Community industry. As regards both
the importers/traders and the user industries, any impact on prices of seamless tubes is expected only
to be marginal.

(123)

In view of the above,
it is concluded that there are no compelling reasons not to impose anti-
dumping duties against imports of seamless pipes and tubes originating in the countries concerned.

G. ANTI-DUMPING MEASURES

1. Injury elimination level

(124)

In view of the conclusions reached with regard to dumping, injury and Community interest, measures
should be imposed in order to prevent further injury being caused to the Community industry by the
dumped imports.

(125) The measures should be imposed at a level sufficient to eliminate the injury caused by these imports
without exceeding the dumping margin found. When calculating the amount of duty necessary to
remove the effects of the injurious dumping, it was considered that any measures should allow the
Community industry to cover its costs of production and to obtain overall a profit before tax that
could be reasonably achieved by an industry of this type in the sector under normal conditions of
in the
competition,
in the absence of dumped imports, on the sales of
Community. The pre-tax profit margin used for this calculation was 5 % of turnover.
It is the
same as in the original proceeding since there was no indication found and no intervention made
that
this rate should be changed. On this basis, a non-injurious price was calculated for the
Community industry of the like product. The non-injurious price has been obtained by adding the
abovementioned profit margin of 5 % to the cost of production.

the like product

i.e.

(1) OJ L 140, 6.6.2003, p. 1.

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(126) The necessary price increase was then determined on the basis of a comparison of the weighted
average import price, as established for the undercutting calculations, with the average non-injurious
price. Any difference resulting from this comparison was then expressed as a percentage of the
average import CIF value.

2. Amended measures

(127)

In the light of the foregoing, it is considered that the anti-dumping duties in force against imports of
the product concerned originating in Croatia and Ukraine should be amended. The new anti-dumping
duties should be set at a level reflecting the injury margins found, as the dumping margins found for
all companies in Croatia and Ukraine were higher than the injury margins calculated. Since the level
of cooperation was high (more than 80 % of the exports of the product concerned from Ukraine to
the Community), the residual margin for Ukraine should be set at the same level as that established
for the cooperating exporting producers OJSC Nizhnedneprovsky Tube Rolling Plant (NTRP) and
CJSC Nikopolsky seamless tubes plant ‘Nikotube’.

(128) The individual company anti-dumping duty rates specified in this Regulation were established on the
basis of the findings of the present investigation. Therefore, they reflect the situation found during
that investigation with respect to these companies. These duty rates (as opposed to the countrywide
duty applicable to ‘all other companies’) are thus exclusively applicable to imports of products
originating in the country concerned and produced by the companies and thus by the specific
Imported products produced by any other company not specifically
legal entities mentioned.
mentioned in the operative part of this Regulation with its name and address,
including entities
related to those specifically mentioned, cannot benefit from these rates and shall be subject to the
duty rate applicable to ‘all other companies’.

(129) 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 relevant 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. If
appropriate, the Regulation will accordingly be amended by updating the list of companies benefiting
from individual duty rates.

(130) The proposed anti-dumping duties are the following:

Country

Company

Injury elimi-
nation margin

Dumping
margin

Proposed
anti-dumping
duty

Croatia

All companies

38,8 %

38,9 %

38,8 %

Ukraine

Dnipropetrovsk Tube Works (DTW), Dnipropetrovsk

51,9 %

91,0 %

51,9 %

OJSC Nizhnedneprovsky Tube Rolling Plant (NTRP),
Dnipropetrovsk and CJSC Nikopolsky seamless tubes
plant ‘Nikotube’, Nikopol

64,1 %

97,3 %

64,1 %

All other companies

64,1 %

97,3 %

64,1 %

(1) European Commission

Directorate-General for Trade
Direction B
Office J-79 5/16
B-1049 Brussels

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(131) On the basis of the measures proposed, a new five-year period for the measures will start to run. The
measures, therefore, will not expire on 18 February 2005 as stated in the notice of impending expiry
published on 27 August 2004 (1).

3. Developments after the IP concerning the Croatian exporter

(132) Subsequent to the disclosure of the essential facts and considerations on the basis of which it was
concluded that the level of the anti-dumping measures should be amended, the Croatian government
informed the Commission that the sole producer in Croatia, Mechel Željezara Ltd, has been liquidated
and ceased production in autumn 2004. In its place, a new legal entity named Valjaonice Cijevi Sisak
d.o.o (Valjaonice) was set up by the Croatian Privatisation Foundation (CPF), a governmental insti-
tution in charge of the privatisation process in Croatia. The newly established company appears not
to have started production yet and is in the process of obtaining the assets from Mechel Željezara
Ltd.

(133) However, from the information submitted it appears that the production capacity of Valjaonice will
remain unchanged compared to that of Mechel Željezara Ltd and that there is a clear intention by
Valjaonice to continue the production of the product concerned. On this basis, the fact that the
production has stopped cannot be considered as of a lasting and undisputed nature and does not,
therefore, affect the findings of the investigation.

(134) However, should there be changes in the situation of the company justifying a review of the

measures, such a review will be initiated.

(135) The Commission, by Decision 2000/137/EC, accepted a price undertaking, inter alia, from the sole
Croatian exporting producer. This undertaking with regard to Mechel Željezara Ltd was also subject
to the review.

4. Undertakings

(136) Through the undertaking, Mechel Željezara Ltd undertook to sell to its independent customers up to
a certain quantity of the product concerned for export to the Community at revised prices. In
addition, Mechel Željezara Ltd undertook that its prices per product group would fall
into line
with the price structure in use in the Community.

(137)

In accordance with Article 8(1) of the basic Regulation, the aim of an undertaking is to eliminate the
injurious effect of dumped imports, which is achieved through the exporter raising its prices or
ceasing exports at dumped levels. The investigation has shown that the type of undertaking originally
accepted in the present case failed to raise prices to non-injurious levels and thus restore fair trade on
the Community market. Therefore, in this case, the undertaking accepted from Mechel Željezara Ltd
is not considered as an appropriate and effective means of eliminating the injurious effect of
dumping. As stated above, Mechel Željezara Ltd has been liquidated recently. Therefore, the under-
taking is considered as being no longer valid.

(138) Subsequent to the disclosure of the essential facts and considerations, on the basis of which it was
concluded that the level of the existing anti-dumping margin should be amended, the Ukrainian
companies OJSC Nizhnedneprovsky Tube Rolling Plant (NTRP), CJSC Nikopolsky seamless tubes
plant ‘Nikotube’ and their related trader/holding company ‘Interpipe’ offered a joint undertaking in
accordance with Article 8(1) of the basic Regulation.

(1) OJ C 215, 27.8.2004, p. 2.

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(139) These Ukrainian companies are producers of different types of steel products which can be sold
together with the product concerned. This raises a potential risk of cross-compensation, i.e. that any
undertaking prices would be formally respected but that prices for products other than the one
concerned would be lowered when sold together with the product concerned. In addition, in view of
the volatility in prices, the minimum export prices that the company was prepared to offer were at
levels which did not eliminate the injurious effects of dumping. Accordingly, this offer could not be
accepted.

(140)

In addition, the Ukrainian company Dnipropetrovsk Tube Works (DTW), Dnipropetrovsk declared
that it was offering an undertaking but without indicating either the nature or any minimum price to
be respected. Therefore, the offer could not be taken into consideration.

H. FINAL PROVISION

(141)

Interested parties were informed of all the facts and considerations on the basis of which it was
intended to propose an amendment to the Regulation in force. They were given the opportunity to
comment and to request a hearing. Comments were received and taken into consideration where
appropriate,

HAS ADOPTED THIS REGULATION:

Regulation (EC) No 348/2000 is hereby amended as follows:

Article 1

1. The table in Article 1(2) shall be replaced by the following:

‘Country

Company

Rate of duty
(%)

TARIC additional
code

Croatia

All companies

Ukraine

Dnipropetrovsk Tube Works (DTW), Dnipropetrovsk

OJSC Nizhnedneprovsky Tube Rolling Plant (NTRP), Dnipropetrovsk
and CJSC Nikopolsky seamless tubes plant “Nikotube”, Nikopol

All other companies

38,8

51,9

64,1

64,1

—

A614

A615

A999’

2. Article 2 shall be deleted.

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

Article 2

L 46/28

EN

Official Journal of the European Union

17.2.2005

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

Done at Brussels, 14 February 2005.

For the Council
The President

J. ASSELBORN