Proposal for a Council Regulation imposing a definitive anti-dumping duty on imports of polyester staple fibres originating in the People's Republic of China and Saudi Arabia, amending Council Regulation (EC) No 2852/2000 imposing a definitive anti-dumping duty on imports of polyester staple fibres originating in the Republic of Korea and terminating the anti-dumping proceeding in respect of such imports originating in Taiwan
Date: 2005-02-17
Institutions: European Commission
Subjects: China, Saudi Arabia, Taiwan, anti-dumping legislation, originating product, textile fibre

COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 17.02.2005 
COM(2005) 54 final 

Proposal for a 

COUNCIL REGULATION 

imposing a definitive anti-dumping duty on imports of polyester staple fibres originating 
in the People's Republic of China and Saudi Arabia, amending Council Regulation (EC) 
No 2852/2000 imposing a definitive anti-dumping duty on imports of polyester staple 
fibres originating in the Republic of Korea and terminating the anti-dumping 
proceeding in respect of such imports originating in Taiwan 

(presented by the Commission) 

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EXPLANATORY MEMORANDUM 

On 19 December 2003, the Commission initiated an anti-dumping investigation with regard to 
imports  into  the  Community  of  polyester  staple  fibre  (PSF)  originating  in  the  People’s 
Republic  of  China  (PRC)  and  Saudi  Arabia.  On  the  same  day,  the  Commission  initiated  an 
interim review concerning imports of the same product originating in the Republic of Korea 
and Taiwan. 

Given  the  need  to  further  examine  certain  aspects  of  injury  and  causation,  no  provisional 
measures  were  imposed  in  the  proceeding  concerning  the  PRC  and  Saudi  Arabia. 
Subsequently, the results of both proceedings were combined.  

Out of five Chinese exporting producers claiming Market Economy status only one fulfilled 
the necessary criteria to be considered as operating under market economy conditions. For the 
remaining four Chinese exporting producers normal value was established on the basis of data 
pertaining to a producer in an analogue country, i.e. the United States of America. Three of 
the latter companies fulfilled the criteria of Article 9(5) of the Basic Anti-dumping Regulation 
and  individual  duties  were  established  for  them.  Significant  dumping  was  found  for  all 
exporting producers in the PRC. 

Out  of  two  Saudi  Arabian  exporting  producers  one  provided  unreliable  information.  The 
dumping  margin  for  this  exporting  producer  was  set  at  the  same  level  as  for  the  second 
exporting producer in Saudi Arabia.  

In the case of the Republic of Korea, dumping was established for two of the three exporting 
producers selected in the sample, albeit at lower levels than in the original investigation. The 
third company was found to have a de minimis dumping margin. The change in circumstances 
was found to be of a lasting nature. The measures in force should be amended accordingly. 

The  level  of  the  dumping  established  for  the  two  companies  investigated  in  Taiwan,  which 
represented more than 95% of the exports of the product concerned to the Community during 
the investigation period was found to be de minimis. The change in circumstances was found 
to be of a lasting nature. Therefore, it is proposed to terminate the proceeding against Taiwan 
without the imposition of measures. 

Over  the  period  2000  to  2003,  the  import  volume  from  the  PRC,  Saudi  Arabia  and  South 
Korea increased by 12% and market share from 15.6 to 17.6%. At the same time import prices 
decreased  by  18%  and  Community  consumption  remained  stable.  In  addition,  it  was  found 
that prices charged by the Community industry for PSF sold on the free market were undercut 
by the exporting producers concerned on average by 16% (PRC), 16.8% (Saudi Arabia) and 
24% (South Korea).  

The  Community  industry’s  production  declined  by  5%,  the  rate  of  capacity  utilisation  fell 
from  87%  to  81%,  the  free  market  sales  volume  in  the  Community  decreased  by  6%, 
corresponding  average  sales  prices  by  8%,  market  share  decreased  from  31%  to  29%, 
profitability  fell  from  4.4%  to  –3.2%,  employment  was  reduced  by  7%  and  cash  flow  was 
negative  during  the  IP.  It  is  considered  that  the  Community  industry  has  suffered  material 
injury.  

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It  was  found  that  the  decline  of  the  Community  industry  coincided  with  the  increase  of 
dumped  imports  and  that  no  other  factors  have  caused  the  material  injury  suffered  by  the 
Community industry.  

Finally,  it  was  found  that  there  are  no  compelling  reasons  against  the  imposition  of  anti-
dumping measures in terms of the overall Community interest.  

It is therefore proposed that the Council adopts the attached proposal for a Regulation which 
should be published in the Official Journal no later than 18 March 2005. 

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Proposal for a 

COUNCIL REGULATION 

imposing a definitive anti-dumping duty on imports of polyester staple fibres originating 
in the People's Republic of China and Saudi Arabia, amending Council Regulation (EC) 
No 2852/2000 imposing a definitive anti-dumping duty on imports of polyester staple 
fibres originating in the Republic of Korea and terminating the anti-dumping 
proceeding in respect of such imports originating in Taiwan 

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  19951  on  protection 
against  dumped  imports  from  countries  not  members  of  the  European  Community  (’Basic 
Regulation’), and in particular Articles 9 and 11(3) thereof, 

Having  regard  to  the  proposal  submitted  by  the  Commission  after  consulting  the  Advisory 
Committee,2 

Whereas: 

A. PROCEDURE 

1. Measures in force 

(1) 

(2) 

(3) 

In  July  1999,  by  Council  Regulation  (EC)  No  1728/19993,  the  Council  imposed 
definitive anti dumping duties on imports of polyester staple fibres (‘PSF’) originating 
in Taiwan. 

In December 2000, by Council Regulation (EC) No 2852/20004, the Council imposed 
definitive  anti  dumping  duties  on  imports  of polyester  staple  fibres  originating, inter 
alia, in the Republic of Korea.  

The level of the definitive anti-dumping duties established for the exporting producers 
in  the  Republic  of  Korea  and  Taiwan  subject  to  the  above  mentioned  investigations, 
expressed as a percentage of the CIF frontier value, was as follows: 

– Taiwan 

– 

Far Eastern Textile Ltd 

6.8% 

1 
2 
3 
4 

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 C […] […], p. […] 
OJ L 204, 4.8.1999, p. 3. 
OJ L 332, 28.12.2000, p. 17. 

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– 

– 

– 

Nan Ya Plastics Corporation 

Shingkong Synthetic Fibres Co. 

All other companies 

– Republic of Korea 

Daehan Synthetic Fibre Co. Ltd. 

Huvis Corporation 

SK Global Co. Ltd. 

Sung Lim Co. Ltd. 

All other companies 

2. Present investigations 

5.9% 

13.0% 

13.0% 

0% 

4.8% 

4.8% 

0% 

20.2% 

– 

– 

– 

– 

– 

(4) 

(5) 

(6) 

On 19 December 2003, the Commission announced by a notice (‘notice of initiation’) 
published  in  the  Official  Journal  of  the  European  Union5,  the  initiation  of  an  anti-
dumping  proceeding  with  regard  to  imports  into  the  Community  of  polyester  staple 
fibres originating in the People’s Republic of China (‘PRC’) and Saudi Arabia. 

On the same day, pursuant to Article 11(3) of the Basic Regulation, the Commission 
announced  by  a  notice published in  the Official Journal of  the  European Union6 the 
initiation  of  an  interim  review  of  the  definitive  anti-dumping  duties  imposed  by 
Council Regulations (EC) No 1728/1999 and (EC) No 2852/2000 on imports of PSF 
originating in the Republic of Korea and Taiwan. 

The  anti-dumping  investigations  were  initiated  following  a  complaint  and  a  request 
lodged on 10 November 2003 by the Comité International de la Rayonne et des Fibres 
Synthétiques  (‘CIRFS’  or  ‘the  complainant’)  on  behalf  of  producers  representing  a 
major proportion, in this case more than 40 %, of the Community production of PSF. 
The  complaint  contained  evidence  of  dumping  of  the  said  product  and  of  material 
injury resulting therefrom, which was considered sufficient to justify the initiation of 
the proceedings. 

3. Investigations concerning other countries and measures in force 

(7) 

There  are  definitive  anti-dumping  measures  currently  in  force  on  imports  of  PSF 
originating  in  (i)  Australia,  Indonesia  and  Thailand  imposed  by  Council  Regulation 
(EC) No 1522/20007; (ii) India imposed by Council Regulation (EC) No 2852/2000; as 
well as (iii) Belarus imposed by Council Regulation (EC) 1799/20028.  

4. Parties concerned by the proceeding 

5 
6 
7 
8 

OJ C 309, 19.12.2003, p. 6. 
OJ C 309, 19.12.2003, p. 2. 
OJ L 175, 14.7.2000, p. 10. 
OJ L 274, 11.10.2002, p. 1. 

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(8) 

(9) 

(10) 

The  Commission  officially  advised  the  known  exporting  producers  in  the  PRC,  in 
Saudi  Arabia,  in  Korea  and  in  Taiwan,  importers/traders  and  their  associations, 
suppliers  and  users  known  to  be  concerned,  the  representatives  of  the  exporting 
countries  concerned  and  the  complainant  and  other  known  Community  producers  of 
the initiation of the proceeding. 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 
notices of initiation. 

In view of the large number of Chinese, Taiwanese and Korean exporting producers, 
listed  in  the  complaint  and  in  the  request,  and  the  large  number  of  Community 
importers  of  the  product  concerned,  sampling  was  envisaged  in  both  notices  of 
initiation for the determination of dumping and injury, in accordance with Article 17 
of the Basic Regulation. 

In  order  to  enable  the  Commission  to  decide  whether  sampling  would  be  necessary 
and,  if  so,  to  select  a  sample,  all  exporting  producers  in  the  countries  mentioned  in 
recital  (9),  and  Community  importers  were  asked  to  make  themselves  known  to  the 
Commission and to provide, as specified in the notices of initiation, basic information 
on their activities related to the product concerned during the period 1 January 2003 to 
30 November 2003 (‘sampling period’). 

(11)  After  examination  of  the  information  submitted  by  Chinese  exporting  producers  and 
due  to  the  low  number  of  replies  to  the  sampling  questions,  it  was  decided  that 
sampling was not necessary in respect of Chinese exporting producers.  

(12) 

In the case of Korea, nine exporting producers replied to the sampling questions. The 
three  largest  exporting  producers  in  terms  of  export  quantities  were  selected  in  the 
sample.  However,  one  of  the  companies  selected  withdrew  its  co-operation 
subsequently,  and  was  therefore  replaced  by  the  fourth  largest  company  in  terms  of 
export quantity. The final sample represented more than 80% of the reported exports 
of the product concerned to the Community during the sampling period and consisted 
of the following companies : 

– 

– 

– 

Huvis Corporation 

Sung Lim Co. Ltd. 

Saehan Industries Inc. 

(13) 

In the case of Taiwan, five companies replied to the sampling questions and reported 
export sales of the product concerned to the Community during the sampling period. 
The three largest companies in terms of export quantities were included in the sample. 
Subsequently, it appeared, however, that one of the selected companies did not export 
the product concerned for consumption in the Community during the sampling period. 
It  had  therefore  to  be  excluded  from  the  sample.  The  fourth  largest  company  which 
was then invited to fill in the questionnaire appeared to be in the same situation. Any 
further  inclusion  of  another  company  in  the  sample,  which  would  have  implied  an 
extended  deadline  to  fill  in  the  questionnaire,  would  have  jeopardized  the  timely 
completion of the investigation at that stage of the investigation. In any case, the two 
remaining  companies  counting  for  more  than  95%  of  the  exports  of  the  product 

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concerned 
representative. The sample consisted therefore of the following companies : 

the  Community  during 

the  sampling  period  were  considered 

to 

– 

– 

Far Eastern Textile Ltd. 

Nan Ya Plastics Corporation 

(14)  As  far  as  importers  into  the  European  Community  are  concerned,  five  companies 
unrelated  to  the  exporting  producers  were  initially  selected  for  the  sample,  based  on 
their  volume  of  imports  from  the  countries  concerned.  One  of  the  three  selected 
companies was subsequently considered as non co-operating and then disregarded as 
part  of  the  sample.  The  remaining  four  sampled  companies  cover  14.6%  of  total 
imports concerned. The final sample consisted of the following companies: 

– 

– 

– 

S.I.M.P., SpA, Italy 

Highams Group Ltd., United Kingdom 

Tob Herman Industries, N.V., Belgium 

–  Marubeni Europe plc Hamburg Branch, Germany 

(15)  The  Commission  sent  market  economy  treatment  (‘MET’)  or  individual  treatment 
(‘IT’) claim forms to the Chinese exporting producers known to be concerned. Claims 
for MET, or for IT in case the investigation establishes that the exporting producers do 
not  meet  the  conditions  for  MET,  were  received  from  five  exporting  producers  plus 
two related companies. 

(16)  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 
notices  of  initiation.  Replies  were  received  from  five  Chinese  exporting  producers, 
from two Saudi Arabian exporting producers, from three Korean exporting producers 
included  in  the  sample,  from  two  Taiwanese  exporting  producers  included  in  the 
sample, five importers in the Community related to a Saudi exporter, one importer in 
the Community importing the product concerned from Korea, two unrelated importers 
included  in  the  sample,  six  Community  industry  producers,  two  non  complainant 
producers, two suppliers of raw materials, ten users and one producer in the analogue 
country, the United States of America (‘USA’).  

(17)  The Commission sought and verified all the information it deemed necessary for the 
purpose  of  a  determination  of  dumping,  resulting  injury  and  Community  interest. 
Verification visits were carried out at the premises of the following companies: 

(a)  Community industry producers  

– 

– 

– 

– 

Catalana de Polimers, S.A, Spain 

Dupont Sabanci Polyester GmbH, Germany 

Industrias Químicas Textiles, S.A., Spain 

Tergal Fibres, S.A., France 

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– 

Trevira GmbH, Germany 

–  Wellman International Limited, Ireland 

(b)  Non-complainant producers 

– 

– 

Freudenberg Politex, S.r.l., Italy.  

Realplastic, S.r.l., Italy 

(c)  Exporting producers in the People’s Republic of China 

– 

AnShun Pettechs Group: 

– 

– 

– 

Hangzhou AnShun Pettechs Fibre Industry Co., Ltd 

Deqing AnShun Pettechs Fibre Industry Co., Ltd 

Kunshan AnShun Pettechs Fibre Industry Co., Ltd 

– 

– 

– 

– 

Cixi Jiangnan Chemical Fiber Co. Ltd.  

Far Eastern Industries (Shanghai) Ltd. 

Jiangyin Changlong Chemical Fibre Co. Ltd 

Xiake Color Spinning Co., Ltd. 

(d)  Exporting producers in Saudi Arabia  

– 

– 

National Polyester Fibers Factory 

Saudi Basic Industries Corporation (Sabic), and related producer Arabian 
Industrial Fibres Company (Ibn Rushd) 

(e)  Exporting producers in the Republic of Korea 

– 

– 

– 

Huvis Corporation, Seoul 

Saehan Industries Inc., Seoul 

Sung Lim Co., Ltd., Kumi-si 

(f)  Exporting producers in Taiwan 

– 

– 

Nan Ya Plastics Corporation, Taipei 

Far Eastern Textile Ltd., Taipei 

(g)  Related importers  

– 

Sabic Global Ltd, The Netherlands 

(h) 

Importer importing the product concerned from Korea  

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– 

Saehan Industries Deutschland (Eschborn, Germany) 

(i)  Unrelated importers  

– 

– 

– 

S.I.M.P. SpA, Italy 

Highams Group Ltd., United Kingdom 

Tob Herman Industries, N.V., Belgium 

–  Marubeni Europe plc Hamburg Branch, Germany 

(18) 

In view of the need to establish a normal value for exporting producers in the PRC to 
which MET might not be granted, a verification visit to establish normal value on the 
basis  of  data  from  an  analogue  country,  the  USA,  took  place  at  the  premises  of  the 
following company: 

–  Wellman Inc., United States of America 

5. Investigation period 

(19)  The investigation of dumping and injury covered the period from 1 January 2003 to 31 
December  2003  (‘investigation  period’  or  ‘IP’).  The  examination  of  trends  in  the 
context of the injury analysis covered the period from 1 January 2000 to the end of the 
IP (‘period under consideration’). 

6. Disclosure 

(20)  All  parties  were  informed  of  the  essential  facts  and  considerations  on  the  basis  of 

which it was intended to recommend: 

(i)  the  imposition  of  definitive  anti-dumping  duties  on  imports  of  PSF  originating  in 
the People’s Republic of China and Saudi Arabia; 

(ii) the termination of the proceeding against imports of PSF originating in Taiwan; 

(iii)  to  amend  Council  Regulation  (EC)  N°  2852/2000  imposing  definitive  measures 
on imports of PSF originating, inter alia, in the Republic of Korea.  

In  accordance  with  the  provisions  of  the  basic  Regulation,  parties  were  granted  a 
period in which they could make representations subsequent to this disclosure. 

(21)  The oral and written comments submitted by the parties were considered and, where 

appropriate, the definitive findings have been modified accordingly. 

B. PRODUCT CONCERNED AND LIKE PRODUCT 

1. Product concerned 

(22)  The  definition  of  the  product  concerned  corresponds  to  the  one  that  was  used  in  the 

investigations mentioned under recital (1) and (2) above. 

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(23)  The  product  concerned  is  synthetic  staple  fibres  of  polyester,  not  carded,  combed  or 
otherwise processed for spinning and is currently classifiable within CN code 5503 20 
00. It is commonly referred to as polyester staple fibres.  

(24)  The product is a basic material used at various stages of the manufacturing process of 
textile products. The Community consumption of PSF is either used for spinning, i.e. 
manufacturing filaments for the production of textiles, mixed with other fibres such as 
cotton and wool or for non-woven applications such as filling, i.e. stuffing or padding 
of certain textile goods such as cushions, car seats and jackets. 

(25)  The product is sold in different product types which can be identified through different 
specifications  such  as  weight,  tenacity,  lustre  and  silicon  treatment  or  through  their 
classification  into  product  families  such  as  round,  hollow,  bi-component  fibres  and 
specialities such as coloured and tri-lobal fibres. From  a production  point  of  view,  a 
distinction can be made between virgin PSF, produced from virgin raw materials, and 
regenerated  PSF,  produced  from  recycled  polyester.  Finally,  quality  may  be 
substandard or first grade. 

(26)  The  investigation  has  shown  that  all  types  of  the  product  concerned  as  defined  in 
recital  (23),  despite  differences  in  a  variety  of  factors  as  defined  in  the  preceding 
recital, have the same basic physical and chemical characteristics and are used for the 
same purposes. Therefore, and for the purpose of the present anti-dumping proceeding, 
all types of the product concerned are regarded as one product. 

2. Like product 

(27)  The  PSF  imported  from  the  exporting  countries  under  consideration  and  sold 
domestically in these countries, the product produced and sold on the domestic market 
of  the  analogue  country  (USA)  as  well  as  the  one  manufactured  and  sold  in  the 
Community  by the Community industry  were found to have the same basic physical 
and  chemical  characteristics  and  the  same  uses.  Therefore,  these  products  are 
considered to be alike within the meaning of Article 1(4) of the Basic Regulation. 

C. DUMPING 

1. General methodology 

(28)  The  general  methodology  set  out  hereinafter  has  been  applied  to  all  exporting 
producers in the Republic of Korea, Taiwan, Saudi Arabia and to the extent possible 
for the PRC. The subsequent presentation of the findings on dumping for the countries 
concerned therefore only describes issues specific to each exporting country. 

2. Normal value 

(29) 

In accordance with Article 2(2) of the Basic Regulation, it was first examined for each 
its  domestic  sales  of  PSF  were 
co-operating  exporting  producer  whether 
representative,  i.e.  whether  the  total  volume  of  such  sales  represented  at  least  5%  of 
the total export sales volume of the producer to the Community.  

(30)  The  Commission  subsequently  identified  those  types  of  PSF  sold  domestically  that 
were identical or directly comparable with the types sold for export to the Community. 
With regard to the examination on a product type basis, and as indicated in recital (27), 

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the Commission considered domestically sold and exported product types, which had 
similar  origin,  denier,  composition,  cross-section,  lustre,  colour,  silicon  treatment, 
quality and use, as being directly comparable. 

(31)  For each type sold by the exporting producers on their domestic markets and found to 
be directly comparable with the type of PSF sold for export to the Community, it was 
established whether domestic sales were sufficiently representative for the purposes of 
Article 2(2) of the Basic Regulation. Domestic sales of a particular type of PSF 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 
type of PSF exported to the Community.  

(32)  The  Commission  subsequently  examined  whether  the  domestic  sales  of  each  type  of 
PSF, sold domestically in representative quantities could be regarded as having been 
made  in  the  ordinary  course  of  trade  in  accordance  with  Article  2(4)  of  the  Basic 
Regulation, by establishing the proportion of profitable sales to independent customers 
of the PSF type in question. In cases where the sales volume of the PSF type, sold at a 
net sales price equal to or above the calculated  cost of production, 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 cost of production, normal value was based on 
the  actual  domestic  price,  calculated  as  a  weighted  average  of  the  prices  of  all 
domestic  sales  of  that  type  made  during  the  IP,  irrespective  of  whether  these  sales 
were profitable or not. In cases where the volume of profitable sales of the PSF type 
represented 80% or less of the total sales volume of that type, or where the weighted 
average price of that type was below the cost of production, normal value was based 
on  the  actual  domestic  price,  calculated  as  a  weighted  average  of  profitable  sales  of 
that  type  only,  provided  that  these  sales  represented  10%  or  more  of  the  total  sales 
volume of that type.  

(33) 

(34) 

In cases where the volume of profitable sales of any product type represented less than 
10% of the total sales volume of that type, it was considered that this particular type 
was  sold  in  insufficient  quantities  for  the  domestic  price  to  provide  an  appropriate 
basis  for  the  establishment  of  the  normal  value.  Wherever  domestic  prices  of  a 
particular  product  type  sold  by  an  exporting  producer  could  not  be  used  in  order  to 
establish normal value, another method had to be applied.  

It  was  examined  whether  normal  value  could  be  established  on  the  basis  of  the 
domestic  prices  of  other  producers  in  accordance  with  Article  2(1)  of  the  Basic 
Regulation.  Since  no  reliable  domestic  prices  of  other  producers  were  available 
constructed  normal  value  was  used,  in  accordance  with  Article  2(3)  of  the  Basic 
Regulation.  

(35) 

In accordance with Article 2(3) of the Basic Regulation, normal value was constructed 
on the basis of each exporting producer’s own cost of manufacturing plus a reasonable 
amount for selling, general and administrative (‘SG&A’) expenses and for profit.  

(36)  Therefore,  the  Commission  examined  whether  the  SG&A  incurred  and  the  profit 
realised  by  each  of  the  exporting  producers  concerned  on  the  domestic  market 
constituted reliable data. 

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(37)  Actual  domestic  SG&A  expenses  were  considered  reliable  where  the  domestic  sales 
volume  of  the  company  concerned  could  be  regarded  as  representative  as  defined  in 
Article  2(2) of  the Basic Regulation. The domestic profit margin was determined on 
the basis of domestic sales made in the ordinary course of trade.  

(38) 

In all cases where these conditions were not met, the Commission examined whether 
data  of  other  exporters  or  producers  in  the  domestic  market  of  the  country  of  origin 
could  be  used  in  accordance  with  Article  2(6)(a)  of  the  Basic  Regulation.  Where 
reliable data were only available for one exporting producer, no average as set out in 
Article  2(6)(a)  of  the  Basic  Regulation  could  be  established  and  it  was  examined 
whether the conditions of Article 2(6)(b) were fulfilled, i.e. the use of data with regard 
to the production and sales of the same general category of products for the exporter or 
producer in question. Where these data were not available or were not provided by the 
exporting  producer,  SG&A  and  profits  were  established  in  accordance  with  Article 
2(6)(c) of the Basic Regulation, i.e. on the basis of any other reasonable method. 

3. Export price 

(39) 

In all cases where the product concerned was exported to independent customers in the 
Community,  the  export  price  was  established  in  accordance  with  Article  2(8)  of  the 
Basic Regulation, namely on the basis of export prices actually paid or payable. 

(40)  Where  the  export  sale  was  made  via  a  related  importer  and  it  was  not  deemed  to  be 
reliable,  the  export  price  was  constructed,  pursuant  to  Article  2(9)  of  the  Basic 
Regulation, on the basis of the price at which the imported products were first resold 
to an independent buyer, duly adjusted for all costs incurred between importation and 
resale, as well as a reasonable margin for SG&A and profits. In this regard, the related 
importer’s  own  SG&A  costs  were  used.  It  is  the  Commission’s  practice  to  establish 
the profit margin on the basis of the information available from co-operating unrelated 
importers. 

(41) 

It should be noted that the investigation has revealed that one unrelated importer deals 
with the product concerned in an ancillary way. The profit margin of this importer was 
therefore not taken into consideration.  

4. Comparison 

(42)  The normal value and export prices for comparable product types 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 prices and price comparability in accordance with Article 2(10) 
of the Basic Regulation. Appropriate adjustments were granted in all cases where they 
were found to be reasonable, accurate and supported by verified evidence. 

5. Dumping margin for the companies investigated 

(43)  According to Article 2(11) of the Basic Regulation, and except for the cases described 
in recital (45) below, the dumping margin for each exporting producer was established 
on  the  basis  of  a  comparison  between  the  weighted  average  normal  value  with  the 
weighted average export price per product type.  

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(44) 

(45) 

In one case it had to be examined whether a transaction-to-transaction method would 
be possible, because the average-to-average method did not reflect the full degree of 
dumping  practiced  (see  recitals  (133)  to  (135)  below).  A  transaction-to-transaction 
comparison  was,  however,  not  possible,  due  to  the  fact  that  the  number  of  the 
domestic  and  the  export  transactions  was  significantly  different.  Furthermore,  no 
domestic transactions coinciding in time with export transactions could be found.  

In cases where the pattern of export prices differed significantly among time periods, 
and  the  method  described  in  recitals  (43)  and  (44)  did  not  reflect  the  full  degree  of 
dumping taking place, the weighted average normal value was compared to prices of 
all  individual  export  transactions,  in  accordance  with  Article  2(11)  of  the  Basic 
Regulation. 

(46)  For  those  exporting  producers  found  to  be  related  companies,  an  average  dumping 
margin was calculated in accordance with the standard practice of the Commission for 
related exporting producers.  

6. Residual dumping margin 

(47)  For  non-cooperating  companies,  a  ‘residual’  dumping  margin  was  determined  in 
accordance with Article 18 of the Basic Regulation, on the basis of the facts available. 

(48) 

In order to determine the residual dumping margin, the level of cooperation was first 
established. The level of cooperation was considered to be high when the volume of 
exports by the cooperating exporting producers was close to that provided by Eurostat 
for  the  country  concerned  and  there  was  no  reason  to  believe  that  any  exporting 
producer  abstained  from  cooperating.  In  this  case  it  was  decided  to  set  the  residual 
dumping  margin  at  the  level  of  the  cooperating  company  with  the  highest  dumping 
margin, in order to ensure the effectiveness of any measure. 

(49)  Where the level of co-operation was low, the residual dumping margin was determined 
on the basis of the highest dumped and representative model for another co-operating 
producer.  This  approach  was  also  considered  necessary  in  order  to  avoid  giving  a 
bonus for non-co-operation and in view of the fact that there were no indications that a 
non-co-operating party had dumped at a lower level. 

7. People’s Republic of China  

7.1 Market Economy Treatment (MET) 

(50) 

In  anti-dumping  investigations  concerning  imports  originating  in  the  PRC,  normal 
value  shall  be  determined  in  accordance  with  paragraphs  1  to  6  of  Article  2  of  the 
Basic Regulation for those producers which were found to meet the criteria laid down 
in Article 2(7)(c). 

(51)  Briefly,  and  for  ease  of  reference  only,  the  criteria  in  Article  2(7)(c)  of  the  Basic 
Regulation, fulfilment of which the applicant companies have to demonstrate, are set 
out in summarised form below: 

(1) 

business decisions and costs are made in response to market conditions, and 
without significant State interference; 

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(2) 

(3) 

(4) 
(5) 

accounting  records  are  independently  audited  in  line  with  international 
accounting standards and applied for all purposes; 
there  are  no  significant  distortions  carried  over  from  the  former  non-market 
economy system; 
legal certainty and stability are provided by bankruptcy and property laws;  
currency exchanges are carried out at the market rate. 

(52)  Five exporting producers in the PRC requested MET pursuant to Article 2(7)(b) of the 
Basic  Regulation  and  replied  to  the  MET  claim  form  for  exporting  producers.  For 
these  companies,  the  Commission  sought  and  verified  at  the  premises  of  these 
companies all information submitted in the MET applications and deemed necessary.  

(53)  The  investigation  showed  that  only  one  of  the  five  companies  mentioned  above 
fulfilled  all  the  criteria  required  and  it  was  therefore  granted  MET.  This  exporting 
producer in the PRC which was granted MET is:  

– 

Far Eastern Industries (Shanghai) Ltd. 

(54)  The  remaining  four  claims  had  to  be  rejected.  The  following  table  summarizes  the 
determination for the four companies for which MET was not granted against each of 
the five criteria as set out in Article 2(7)(c) of the Basic Regulation. 

Company 

Article 
2(7)(c) 
indent 1 

Article 
2(7)(c) 
indent 2 

Criteria 

Article 
2(7)(c) 
indent 3 

Article 
2(7)(c) 
indent 4 

Article 
2(7)(c) 
indent 5 

1 

2 

3 

4 

Not met 

Not met 

Not met 

Met 

Not met 

Not met 

Not met 

Not met 

Not met 

Not met 

Not met 

Not met 

Met 

Met 

Met 

Met 

Met 

Met 

Met 

Met 

Source: Verified questionnaire replies of co-operating Chinese exporters 

(55)  The  companies  concerned  were  given  an  opportunity  to  comment  on  the  above 
findings.  All  four  companies  to  which  MET  was  not  granted  disagreed  with  the 
determinations made and claimed that they should be granted MET. 

(56)  Concerning  the  first  criterion,  i.e.  that  business  decisions  are  made  in  response  to 
market signals, without significant State interference, and costs reflect market values, 
one company objected to the Commission’s conclusion that it received a State subsidy 
and therefore costs did not entirely reflect market values. In this case, the collectively 
owned shareholder contributed assets when the company was established and was not 
compensated  for  the  increased  value  of  the  company  when  subsequently  selling  its 
shares.  During  the  on-spot  verification  evidence  was  collected  confirming  that  the 
State owned shareholder was not compensated for such increase in value. Due to this 
financial  benefit,  the  company  did  not  have  to  pay  the  market  value  for  the  assets 

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necessary to produce the product concerned. Consequently, decisions regarding costs 
and inputs were not considered to be made in response to market signals.  

(57) 

In  addition,  the  company  tried  to  hide  possible  State  interference.  Indeed,  when 
reviewing the translation of the Chinese version of the company’s business licence, it 
was  found  that  information  concerning  the  business  scope  of  its  shareholder,  in 
particular the reference to management and operation of the town-owned assets, was 
blatantly omitted. Therefore, it had to be concluded that the exporting producer did not 
provide sufficient information that it was operating under market economy conditions. 
None of the arguments brought forward by the company concerned subsequent to the 
disclosure could reverse this conclusion and the claim had to be rejected.  

(58)  Regarding the second criterion, i.e. that firms  have one  clear set of basic accounting 
records  which  are  independently  audited  in  line  with  international  accounting 
standards, four companies submitted that they are fulfilling the criterion because their 
accounting records are independently audited. However, it was found that the auditor’s 
reports of three of the companies did not mention several serious problems (including 
non-respect  of  basic  international  accounting  rules)  detected  during  the  on-spot 
verification, or explain changes in the accounting policy of the companies concerned. 
Another company was found not to reflect in its accounts the recommendations made 
by its auditor. Therefore, it had to be concluded that the accounting records of all four 
companies concerned were not audited in line with international accounting standards 
as  required  by  Article  2(7)(c)  second  indent  of  the  Basic  Regulation  and  the  claims 
were rejected. 

(59)  Regarding  the  third  criterion,  three  companies  submitted  that  contrary  to  the 
Commission’s  findings,  there  were  no  significant  distortions  carried  over  from  the 
former non-market economy system. In one case, this claim had to be rejected because 
it  was  found  that  the  company  concerned  received  an  interest-free  loan  from  the 
government  and  several  other  subsidies.  This  means  that  there  are  significant 
distortions  carried  over  from  the  former  non-market  economy  system  having  an 
impact  on  the  production  costs.  As  far  as  the  second  company  is  concerned,  no 
reconciliation  could  be  established  between  the  amounts  due  and  those  actually  paid 
for  the  company’s  land  use  rights.  Furthermore,  and  this  relates  also  to  the  second 
criterion, this company’s depreciation of intangible assets was not made according to 
accounting  standards.  A  third  company  argued  that  the  fact  that  it  could  not  submit 
any evidence concerning the payment of its capital contribution by the shareholders, as 
determined by the Articles of Association, was unrelated to any significant distortion 
from  the  former  non-market  economy  system,  because  the  interests  involved  were 
private.  The  investigation  revealed,  however,  that  the  rules  regarding  the  company 
paid  in  capital  were  not  enforced  by  the  Chinese  authorities.  Therefore,  it  was 
concluded that this company was subject to a significant distortion carried over from 
the non-market economy system and its costs, in particular in relation to depreciation 
of  assets,  were  significantly  distorted.  It  was  consequently  concluded  that  the 
companies concerned did not fulfil the conditions set out in Article 2(7)(c) third indent 
of the Basic Regulation and their claims had therefore to be rejected. 

(60)  One  company  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. 

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(61) 

(62) 

In  this  respect  it  is  noted  that  the  Commission  granted  several  extensions  to  the 
deadline  to  the  Chinese  exporting  producers  concerned,  including  the  above 
mentioned  company,  which  had  major  difficulties  to  fill  in  the  MET  claim  forms 
within the deadline set in the notice of initiation.  

It is also noted that most MET claims received were deficient and required a number 
of  substantial  clarifications  and  additional 
the 
investigation.  Finally,  the  complexity  of  a  number  of  issues  such  as  the  company 
structures and sales channels as well as the serious problems found during the on-spot 
verification with regard to the companies’ accounts prolonged the analysis and it was 
not possible to make a determination regarding the MET claims received within three 
months from the initiation.  

information  which  delayed 

(63) 

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 above mentioned company did not claim 
any  negative  impact  due  to  the  longer  period  needed  for  the  MET  determination. 
Indeed, none of the other interested parties claimed that it had suffered such prejudice. 

(64)  Given the above, it is concluded that a valid determination with regard to MET can be 
made even after the three months period and the claim of the company concerned was 
therefore rejected.  

(65)  The  Advisory  Committee  was  consulted  and  the  parties  directly  concerned  were 
informed  accordingly.  The  Community  industry  was  given  the  opportunity  to 
comment, but no comments were received concerning the MET determination.  

7.2 Individual Treatment (IT) 

(66)  Further  to  Article  2(7)(a)  of  the  Basic  Regulation,  a  country-wide  duty,  if  any,  is 
established for countries falling under Article 2(7) of the Basic Regulation, except in 
those cases where companies are able to demonstrate, in accordance with Article 9(5) 
of the Basic Regulation, that (a) they are free to repatriate capital and profits; (b) their 
export prices and quantities, as well as the conditions and terms of the sales are freely 
determined;  (c)  the  majority  of  shares  belong  to  private  persons;  (d)  exchange  rate 
conversions are carried out at market rates, and (e) any State interference is not such as 
to permit circumvention of measures if exporters are given different rates of duty. 

(67)  The  five  exporting  producers,  as  well  as  requesting  MET,  also  claimed  individual 
treatment in the event of not being granted MET. As specified above, the companies 
have to demonstrate that they are complying with the criteria set out in Article 9(5) of 
the Basic Regulation. As described in recital (57), one company provided misleading 
information concerning the business scope of one of its shareholders in order to hide 
possible State interference. Therefore, the company could not demonstrate that it was 
completely free to determine export prices and quantities, and conditions and terms of 
sale. In addition, it was not able to demonstrate whether the State interference was not 
such  as  to  permit  circumvention  of  measures  if  this  exporter  were  to  be  granted  an 
individual  duty  rate.  As  this  company  did  not  meet  all  the  criteria  set  out  in  Article 
9(5) of the Basic Regulation, it was decided not to grant IT to this company.  

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(68)  One  of  the  other  three  companies  which  was  not  granted  MET,  was  partly  foreign 
owned  and  was  free  to  repatriate  its  profits.  The  other  two  companies  are  owned  by 
Chinese individuals located in the PRC and therefore do not fall under this criterion. 
On the basis of the verified information provided by the three companies, it was found 
that  the  State  had  no  influence  on  the  ability  of  the  firms  to  freely  set  their  export 
prices and quantities and conditions and terms of sale. The degree of State interference 
in  these  companies  was  also  not  considered  such  as  to  permit  circumvention  of 
measures as the majority of the shares in these companies belong to genuinely private 
companies. As they are competing with each other both on the domestic as well as on 
the  export  market,  each  company  will  take  advantage  of  its  individual  margin  rather 
than allow any circumvention. As already mentioned in recital (54), all companies met 
the fifth criterion set out in Article 2(7)(c) of the Basic Regulation that all exchange 
rate conversions are carried out at market rates. Therefore, it was concluded that three 
of  the  companies  to  which  MET  was  not  granted,  met  the  requirements  for  IT,  set 
forth in Article 9(5) of the Basic Regulation. 

(69) 

It was therefore concluded that IT should be granted to the following three exporting 
producers in the PRC:  

– 

AnShun Pettechs Group, comprising the following related exporters: 

– 

– 

– 

Hangzhou AnShun Pettechs Fibre Industry Co., Ltd 

Deqing AnShun Pettechs Fibre Industry Co., Ltd 

Kunshan AnShun Pettechs Fibre Industry Co., Ltd 

– 

– 

Cixi Jiangnan Chemical Fiber Co. Ltd.  

Jiangyin Changlong Chemical Fibre Co. Ltd 

7.3 Normal value 

7.3.1  Determination  of  normal  value 

for  co-operating  exporting 

producers granted MET 

(70)  The  Chinese  exporting  producer  granted  MET  was  requested  to  submit  a  full 
questionnaire reply including domestic sales information and information on costs of 
production  of  the  product  concerned.  This  reply  was  verified  at  the  premises  of  the 
company concerned. 

(71)  As  far  as  the  determination  of  normal  value  is  concerned,  the  Commission  followed 

the same methodology as the one explained in recitals (29) to (38). 

7.3.2  Determination  of  normal  value  for  all  exporting  producers  not 

granted MET 

– 

(i) Analogue country 

(72)  Pursuant  to  Article  2(7)(a)  of  the  Basic  Regulation,  normal  value  for  the  exporting 
producers not granted market economy treatment has to be established on the basis of 

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the  prices  or  constructed  value  in  a  market  economy  third  country  (‘analogue 
country’). 

(73) 

(74) 

In the notice of initiation, the USA was envisaged as an appropriate market economy 
third country for the purpose of establishing normal value for the PRC and interested 
parties  were  invited  to  comment  on  this.  Three  exporting  producers  contested  this 
choice  within  the  deadlines  and  one  proposed  the  choice  of  an  exporting  country 
involved  in  the  current  proceeding  with  the  lowest  normal  value  found  as  analogue 
country. It was argued that the level of economic development of the USA is different 
from that of PRC and that costs, including prices of raw materials, are relatively higher 
in the USA.  

In  order  to  establish  whether  the  envisaged  choice  of  the  USA  as  analogue  country 
was  appropriate,  the  Commission  first  requested  information  regarding  sales  and 
market conditions from known producers of PSF in other market economy countries, 
namely  in  the  USA,  India,  Indonesia  and  Thailand.  Replies  to  the  requested 
information were received from one producer in the USA, a producer in India and two 
producers  in  Indonesia.  It  was  also  examined  whether  Taiwan  or  the  Republic  of 
Korea,  which  are  subject  to  the  parallel  interim  review  mentioned  in  recital  (5) 
regarding the same product, could be regarded as an appropriate analogue country.  

(75)  Regarding  Taiwan,  the  information  available  from  the  parallel  interim  review 
investigation  showed  that  only  virgin  PSF  was  sold  on  the  domestic  market  while 
Chinese  exporters  not  granted  MES  sold  exclusively  recycled  PSF,  which  would 
require  important  adjustments  when  comparing  normal  value  to  the  export  price. 
Concerning  Korea,  it  was  found  that  the  exporting  producers  exported  at  dumped 
prices to the Community (see recital (112) to (137) below), which pointed to the very 
likely distortion in the domestic market of this country. In addition, most sales in the 
Korean market were of virgin PSF, while only one company (out of three) produced 
recycled  PSF.  In  contrast,  in  the  USA  both  virgin  and  recycled  PSF  was  sold  in 
significant quantities. It was therefore concluded that there is no apparent reason that 
Korea or Taiwan is more appropriate than the USA as an analogue country. The other 
potential analogue countries are subject to anti-dumping duties and/or countervailing 
duties which could indicate distortions in their domestic markets of this product. 

(76)  The  analysis  of  all  of  the  information  available  to  the  Commission  showed  that  the 
USA has a large and highly competitive market for the product concerned, with more 
than  ten  producers  and  significant  imports  from  third  countries.  Although  anti-
dumping duties were imposed on imports of the product concerned from the Republic 
of Korea and Taiwan, there were still substantial imports of PSF from other countries.  

(77)  As mentioned in recital (27) the product produced and sold in the US domestic market 
was  a  like  product  to  the  product  exported  from  China  to  the  Community.  In  this 
respect,  only  those  product  types  produced  in  the  USA  with  the  same  production 
process were taken into account for the comparison, i.e. PSF from recycled waste. 

(78) 

In China, the main raw material used, i.e. recycled waste, was largely sourced on the 
domestic  market,  while  some  was  also  imported  from  the  USA  and  Europe.  The 
producer in the analogue country purchased raw materials exclusively from domestic 
suppliers. It was therefore concluded that the access to raw materials in the USA was 
easier or at least similar as compared to the PRC. 

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(79)  The choice of the analogue country on the basis of the lowest normal value found was 
considered  unreasonable  as  it  is  not  based  on  clear  criteria  but  rather  on  the  final 
result.  Equally,  the  fact  that  costs  are  allegedly  higher  in  a  market  economy  third 
country as such cannot be considered as a reason not to consider such country as an 
appropriate analogue country. One possible objective of State interference may be to 
keep a low cost level in order to support certain domestic industries and maintain them 
competitive. In these cases, lower costs would simply be the consequence of this State 
interference  and  not  be  the  result  of  market  forces.  It  is  precisely  the  aim  of  Article 
2(7)(a) of the Basic Regulation that an analogue country is selected in order for normal 
value to be based on prices and costs unbiased by non-market economy conditions.  

(80)  As  far  as  the  different  level  of  economic  development  of  the  USA  and  the  PRC  is 
concerned,  this  in  itself  is  not  a  relevant  factor  when  selecting  an  analogue  country. 
Indeed, the selection of a modern and cost efficient market characterised by intensive 
competition should result in a lower normal value than if the analogue country has a 
comparable economic development to the non market economy country. 

(81)  Considering  the  above,  it  was  concluded  that  the  USA  was  the  most  appropriate 
analogue country and that under these circumstances the selection of the USA seemed 
reasonable and justified in accordance with Article 2(7) of the Basic Regulation. 

(82)  The  Commission  subsequently  sent  a  more  detailed  questionnaire  to  the  producer  in 
the USA requesting information on domestic sales prices and cost of production of the 
like product. The reply of the producer was verified on the spot.  

(83)  After  the  expiry  of  the  deadline  to  submit  comments  on  the  disclosure,  two  Chinese 
exporting  producers  argued  that  the  USA  did  not  constitute  an  appropriate  analogue 
country as since January 2001 there is an on-going investigation for anti-competitive 
behaviours and price fixing in the American PSF market, involving the co-operating as 
well as eight other companies in the US. In the framework of this investigation two of 
the co-defendants have pleaded guilty and one of them was fined. It was argued that 
South Korea or Taiwan should be used instead. 

(84) 

It should be noted that the above investigation relates to practices occurring more than 
a  year  before  the  start  of  the  investigation  period  and  no  information  was  available 
which would indicate that such practices, carried-out by the two market actors which 
have pleaded guilty, would have affected the prices during the IP which were used as 
the basis for the normal value calculation. On the contrary, when comparing the profit 
margin  made  by  the  producer  in  the  analogue  country  on  domestic  sales  of  the  like 
product, with that made by producers in Korea and Taiwan, such margin was found to 
be  either  similar  or  lower.  Furthermore,  the  investigation  has  not  resulted  in  any 
charges against the co-operating US producer (Wellman Inc.), which was informed by 
the US authorities in September 2004 that no indictment was sought for the company 
or its employees. In light of the above, it is concluded that the information provided by 
the co-operating US producer and used as a basis for determining normal value has not 
been  distorted  by  any  anti-competitive  behaviour  that  may  have  existed  on  the  US 
market in the past. In these circumstances, the US is confirmed as a suitable choice of 
analogue country. However, it is noted that, in any event, should an investigation find 
that  such  anti-competitive  practices  would  have  taken  place  during  the  investigation 
period or would have distorted the findings of this investigation, the current findings 
may be subject to a review. 

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– 

(ii) Determination of normal value in the analogue country 

(85)  Pursuant  to  Article  2(7)  of  the  Basic  Regulation,  normal  value  for  the  exporting 
producers  not  granted  MET  was  established  on  the  basis  of  verified  information 
received from the producer in the analogue country, i.e. on the basis of all prices paid 
or  payable  on  the  domestic  market  of  the  USA  for  comparable  product  types,  since 
these  were  found  to  be  made  in  the  ordinary  course  of  trade  and  in  representative 
quantities.  

(86)  As  far  as  the  determination  of  normal  value  is  concerned,  the  Commission  followed 

the same methodology as the one explained in recitals (29) to (38). 

7.4 Export price 

(87)  All  export  sales  to  the  Community  by  the  exporting  producers  granted  MET  or  IT 
were  made  directly  to  independent  customers  in  the  Community  and  therefore,  the 
export price was established in accordance with Article 2(8) of the basic Regulation on 
the basis of the prices actually paid or payable. 

7.5 Comparison 

(88)  Claimed adjustments were made in respect of duty drawback, transport, insurance and 
handling,  packing  and  credit  costs,  bank  charges  and  commissions  where  applicable 
and justified. 

(89)  Certain  product  types  exported  by  the  Chinese  exporting  producers  which  were 
granted  IT  had  some  different  physical  characteristics  when  compared  to  the 
comparable types sold in the analogue country, such as lustre, colour, cross section or 
silicon  treatment.  Therefore,  an  allowance  in  line  with  Article  2(10)(a)  of  the  Basic 
Regulation was made. In the absence of any more reliable information, the adjustment 
was  established  on  the  basis  of  the  price  difference  related  to  these  specific 
characteristics found in the analogue country. 

(90)  The investigation revealed that sales in the analogue country were made exclusively to 
end-users  while  Chinese  exporting  producers  made  also  sales  through  other  sales 
channels. In the absence of the same sales channels in the analogue country, a special 
adjustment  has  been  granted,  in  accordance  with  Article  2(10)(d)(ii)  of  the  Basic 
Regulation, by deducting from the end-users normal value, an amount corresponding 
to 10% of the gross profit margin. 

(91)  On the basis of the above, normal value was established for between around 70% and 
around 90% of the companies’ granted IT exported quantity of the product concerned 
to the Community. This was considered representative of the degree of dumping being 
practiced.  

(92)  An  adjustment  was  also  made  with  regard  to  the  Chinese  exporting  producer  for 

differences in VAT reimbursement. 

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7.6 Dumping margin 

(93)  For the company granted MET the dumping margin was established on the basis of a 
comparison  of  the  company’s  weighted  average  normal  value  with  its  weighted 
average export prices per product type, as determined above.  

(94)  For the three companies granted IT, the weighted average normal value for the types 
exported to the Community established for the analogue country was compared with 
the  weighted  average  export  price  of  the  corresponding  type  exported  to  the 
Community, as provided for under Article 2(11) of the Basic Regulation.  

(95)  For  the  co-operating  company  neither  granted  MET  nor  IT,  and  for  all  non-
cooperating  exporters,  the  country-wide  dumping  margin  was  established  as  the 
weighted average of the dumping margin found for the non-market economy producer 
without IT and the highest dumped and representative model for one co-operating non-
market economy exporting producer, as explained in recital (49) above. 

(96)  The  dumping  margins  expressed  as  a  percentage  of  the  CIF  net  free-at-Community-

frontier price, before duty, are: 

Company 

Dumping margin 

Cixi Jiangnan Chemical Fiber Co. Ltd 

Far Eastern Industries (Shanghai) Ltd 

26.3% 

4.9% 

Hangzhou AnShun Pettechs Fibre Industry Co., Ltd 

Deqing AnShun Pettechs Fibre Industry Co., Ltd 

49.0% 

Kunshan AnShun Pettechs Fibre Industry Co., Ltd 

Jiangyin Changlong Chemical Fibre Co. Ltd 

All other companies 

8. Saudi Arabia  

63.2% 

85.8% 

(97)  Questionnaire replies were received from two exporting producers and five importers 

related to one of the exporters. 

8.1 Saudi Basic Industries Corporation (‘Sabic’) 

8.1.1 Normal value 

(98)  This  exporting  producer  had  representative  sales  of  the  like  product  on  the  domestic 
market. Nevertheless, such sales could not be regarded as being made in the ordinary 
course of trade by reason of price. Consequently, and in the absence of reliable data 
from other producers in the exporting country, normal value had to be constructed, as 
determined by Article 2(3) of the Basic Regulation. 

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(99)  To  construct  normal  value  actual  SG&A  expenses  incurred  by  the  cooperating 
exporting  producer  concerned  on  domestic  sales  of  the  like  product,  in  the  ordinary 
course of trade, during the investigation period, were added to its own average cost of 
manufacturing, of each exported type, during the investigation period. 

(100)  Since no reliable data was available for other exporting producers in Saudi Arabia (see 
recitals  (104)  to  (106)  below)  and  since  no  information  pertaining  to  production  and 
sales  of  the  same  general  category  of  products  was  made  available  by  the  exporting 
producer concerned, the profit margin had to be determined on the basis of any other 
reasonable  method,  as  determined  by  Article 2(6)(c)  of  the  Basic  Regulation.  In  this 
respect it was considered that a profit margin of 5% was reasonable. No information 
was  available  which  would  indicate  that  such  profit  margin  exceeds  the  profit 
normally  realized  by  other  exporters  or  producers  on  sales  of  products  of  the  same 
general category in the domestic market of Saudi Arabia, as required by Article 2(6)(c) 
of the Basic Regulation.  

8.1.2 Export price 

(101)  All  sales  were  made  to  the  Community  via  a  related  importer,  which  resold  the 
product  to  both  related  and  unrelated  customers.  Those  related  customers,  in  turn, 
resold  the  product  concerned  to  other  independent  customers.  Consequently,  the 
export price was constructed pursuant to Article 2(9) of the Basic Regulation.  

8.1.3 Comparison 

(102)  Adjustments  were  made  for  differences  in  transportation,  insurance,  packing,  and 

credit costs.  

(103)  An  allowance  to  the  normal  value  was  also  claimed  by  this  exporting  producer  for 
after  sales  costs  on  the  domestic  market.  Besides  the  fact  that  no  evidence  was 
available substantiating the amount claimed, it could not be concluded, on the basis of 
the  information  made  available,  that  this  factor  affected  price  comparability.  In 
particular,  it  could  not  be  shown  that  domestic  customers  consistently  paid  different 
prices due to this factor. In addition, it was established that these expenses related not 
only  to  sales  of  the  like  product  in  the  domestic  market  but  also  to  other  markets, 
including sales of the product concerned to the Community. On the basis of the above, 
the  allowance  claimed  had  to  be  rejected,  since  it  did  not  meet  the  requirements  of 
Article 2(10). 

8.2 National Polyester Fibers Factory (‘NPF’) 

(104)  The  questionnaire  reply  submitted  by  this  exporting  producer  was  significantly 
deficient  and  contained  contradictory  information.  Although  the  company  was 
requested  to  correct,  complete  and  clarify  its  reply,  it  did  not  provide  the  missing 
information  and  did  not  make  appropriate  corrections.  Furthermore,  the  on-spot 
verification  revealed  that  NPF  did  not  report  more  than  half  of  its  domestic  sales  of 
PSF in the IP. In addition, it was not possible to reconcile the company’s reported total 
sales, including export sales to the Community, with its accounting documents. It was 
therefore considered that the sales data submitted in the questionnaire reply could not 
be regarded as a reliable basis to establish a dumping margin. 

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(105)  Furthermore,  data  pertaining  to  cost  of  production  could  not  be  reconciled  with  the 
company’s  internal  accounting  documents  and  no  substantiating  evidence  was  made 
available  showing  that  the  reported  data  was  indeed  complete  and  correct.  It  was 
therefore  concluded  that  the  information  submitted  on  the  cost  of  production  of  the 
like product was not reliable and could not be used as a basis to determine the normal 
value. 

(106)  In  view  of  the  above,  it  was  considered  that  the  dumping  margin  for  this  exporting 
producer could not be established on the basis of its own data. The dumping margin 
was therefore determined on the basis of facts available, as foreseen by Article 18 of 
the Basic Regulation. In this regard, and given the insufficient information submitted 
by NPF, there were no reasons to conclude that NPF dumped at a different level than 
the other exporting producer in Saudi Arabia. Therefore, it was considered appropriate 
to  set  the  dumping  margin  for  NPF  at  the  same  level  as  the  one  established  for  the 
other exporting producer in Saudi Arabia.  

(107)  The company contested the approach arguing that it had acted with total transparency 
and that any errors in the information provided were unintentional and purely clerical. 
Nevertheless,  no  further  verifiable  information  was  provided  which  could  allow  the 
Commission to revise its findings. 

(108)  The other Saudi exporting producer disagreed with the above approach, arguing that it 
would constitute a bonus for non-cooperation. It was further argued that NPF exported 
other product types, which are not comparable to the types exported by Sabic. In this 
respect it should be noted that the determination of the dumping margin for NPF was 
made  on  the  basis  of  the  best  information  available.  The  vast  majority  (81%)  of 
exports of the product concerned from Saudi Arabia to the Community were made by 
Sabic. Therefore, in the absence of any other reasonable method, this was considered 
an appropriate basis for the setting of the dumping margin for NPF. Furthermore, as 
stated above, there were no reasons to conclude that NPF dumped at a different level 
than  the  other  exporting  producer  in  Saudi  Arabia.  Regarding  the  different  product 
types exported by the two companies it is noted that they all fall within the definition 
of the product concerned. In these circumstances, the approach set out in recital (106) 
is considered reasonable. 

8.2.1 Dumping margin 

(109)  The dumping margin was established on the basis of a comparison of the company’s 
weighted  average  normal  value  with  its  weighted  average  export  prices  per  product 
type, as determined above. As  explained in  recital (106) above,  the  dumping  margin 
for the other exporting producer in Saudi Arabia, namely NPF, was established at the 
same level as the margin found for the co-operating producer in Saudi Arabia (Sabic).  

(110)  The comparison between the normal value and the export price showed the existence 
of dumping. The dumping margins, expressed as a percentage of the CIF net free-at-
Community-frontier price, before duty, are: 

National Polyester Fibers Factory  31.7% 

Saudi Basic Industries Corporation (Sabic) 31.7% 

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(111)  Since  the  aforementioned  two  companies  represented  all  export  sales  from  Saudi 
Arabia to the Community, as explained in recital (48), the residual duty was also set at 
the  level  of  the  cooperating  company  with  the  highest  dumping  margin.  Thus,  the 
residual  duty  expressed  as  a  percentage  of  the  CIF  net  free-at-Community-frontier 
price, before duty, is 31,7%.  

9. The Republic of Korea 

(112)  Questionnaire replies were received from the three exporting producers selected in the 

sample. 

(113)  One exporting producer initially submitted data for all products containing polyester. 
However, since the present review concerns only synthetic staple fibres of polyester, 
not  carded,  combed  or  otherwise  processed  for  spinning  which  are  currently 
classifiable  within  CN  code  5503  20  00  (i.e.  with  50%  or  more  of  polyester),  all 
products that were declared by the exporting producer as containing less than 50% of 
polyester were disregarded. 

9.1 Normal value 

(114)  For the three exporting producers selected in the sample, sales of the like product were 
representative as defined above in recitals (29) to (31). To a large extent, normal value 
was based on prices paid or payable, in the ordinary course of trade, by independent 
customers  in  the  Republic  of  Korea,  in  accordance  with  Article  2(1)  of  the  Basic 
Regulation.  However,  for  those  product  types  where  the  domestic  sales  were 
insufficient to be considered representative or not made in the ordinary course of trade, 
normal value was constructed in accordance with Article 2(3) of the basic Regulation, 
as explained in recital (34).  

(115)  One  exporting  producer  in  the  Republic  of  Korea  reported  sales  made  to  Korean 
manufacturing  companies  as  domestic  sales,  although  the  product  was  ultimately 
destined for export. The exporting producer argued that these sales were intended for 
domestic  consumption.  However, 
to  administrative 
arrangements  specific  to  export  sales  as  they  were  not  subject  to  domestic  sales  tax, 
they were normally invoiced in US dollars and paid for by letters of credit, they were 
subject to duty drawback arrangements and normally classified as local export sales in 
the companies' accounting records. Under these circumstances, and in accordance with 
the  approach  taken  in  the  investigation  mentioned  in  recital  (2)  (the  ‘original 
investigation’), these sales were excluded for the purpose of calculating normal value 
for that company. 

these  sales  were  subject 

(116)  The  same  exporting  producer  in  the  Republic  of  Korea  benefited  from  a  national 
programme designed to help Korean companies in financial difficulties, the so called 
‘work  out  programme’.  Under  this  programme,  the  company  was  able  to  transform 
debts  into  equity,  accounting  for  a  significant  amount  booked  as  an  income  and 
offsetting  thus  artificially  the  company’s  SG&A  expenses  to  a  large  extent.  It  was 
therefore considered that this amount should not be considered as an ordinary income 
to  be  taken  into  account  in  the  calculation  of  the  SG&A.  The  reported  SG&A, 
including  the  artificial  income,  consequently  did  not  reasonably  reflect  the  costs 
incurred in the production and sales of the like product. Therefore, and in accordance 

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with Article 2(5) of the basic Regulation, this amount was not taken into account in the 
calculation of the SG&A. 

(117)  The  company  also  claimed a gain  resulting from reversal of bad debts  in  the SG&A 
calculation. Since these debts were not related to the product concerned and referred to 
benefits under the work out programme, they do not constitute an ordinary income to 
be  taken  into  account  in  the  calculation  of  the  SG&A.  The  company  claimed  that 
reversal of bad debts occur every year and therefore should not be excluded from the 
calculation.  This  is  in  contradiction  with  the  audited  reports  of  the  company,  which 
show  that  no  such  reversal  took  place  over  the  two  last  financial  years  and  that  it  is 
specifically  linked  to  the  work  out  programme.  Therefore,  the  exclusion  of  this  gain 
from the SG&A calculation is maintained. 

(118)  The  company  claimed  that  the  adjustments  to  the  SG&A  resulted  from  its  normal 
business  operations  and  should  therefore  not  be  disregarded.  It  submitted  new 
information after the disclosure which indicated, however, that the two gains referred 
to  in  the  previous  recitals  did  not  relate  to  the  product  concerned.  Furthermore,  the 
new unverified information contradicted the information collected during the on-spot 
investigation  and  could  therefore  not  be  accepted.  On  these  grounds,  the  claims 
relating to the work out programme are rejected. 

(119)  The same exporting producer declared a high insurance income during the IP due to a 
fire in one of the production lines of the product concerned, which occurred before the 
IP.  The  company  deducted  this  income  from  the  SG&A  expenses  related  to  the 
domestic  sales  of  the  product  concerned.  On  the  other  hand,  it  did  not  take  into 
account the costs incurred during the IP as a result of that fire. SG&A expenses were 
therefore largely understated. The income from the insurance was used to install a new 
production  line  not  producing  the  product  concerned  anymore.  It  was  consequently 
considered that any costs and income resulting from the fire were either outside the IP 
or  not  related  to  the  product  concerned  and  should  therefore  be  disregarded  when 
calculating the SG&A for the purpose of the calculation of the normal value. 

(120)  After disclosure, this company objected to the above conclusions claiming that it had 
incurred  costs  because  of  a  loss  of  business.  However,  this  claim  was  already 
investigated during the on-spot verification visit where the company failed to submit 
any  supporting  evidence  which  could  show  the  part  of  the  insurance  income  which 
was allegedly destined for the loss of business. This claim had therefore to be rejected.  

9.2 Export price 

(121)  One exporting producer notified that in the original investigation, the company had a 
related importer in the Community. The exporting producer claimed that this situation 
had changed, and that the importer in the Community, even if it was still existing, was 
not  anymore  related  to  them.  It  is  to  be  noted  that  the  importer  accounted  for  a 
significant amount of the sales of the product concerned to the Community made by 
the  Korean  exporting  producer.  This  issue  was  examined  carefully  in  order  to 
determine whether the application of the provisions set out in Article 2(9) of the basic 
Regulation was warranted in the present case. 

(122)  An  analysis  was  carried  out  on  the  prices  charged  to  the  related  importer  by  the 
Korean exporting producer. It was found that these prices were consistently sold at the 

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same  level  as  those  charged  to  unrelated  importers  during  the  investigation  period. 
Under  these  circumstances,  it  was  considered  that  the  prices  between  the  related 
parties were at arms-length and reliable. Therefore, since export prices were reliable, 
there  was  no  need  to  recur  to  the  provisions  set  out  in  Article  2(9)  of  the  Basic 
Regulation and to conclude on the relationship between the companies.  

(123)  Therefore,  in  the  case  of  this  exporting  producer,  the  export  price  was  based  on  the 

prices paid or payable by all customers in the Community. 

(124)  For the two other exporting producers, the export price was based on the prices paid or 

payable by unrelated customers in the Community. 

9.3 Comparison 

(125)  To ensure a fair comparison, allowances were made for differences in import charges 
and  indirect  taxes,  duties,  transport,  insurance,  handling,  loading  and  ancillary  costs, 
packing  costs,  bank  charges,  credit  costs  and  commissions  where  applicable  and 
justified. 

(126)  All  three  exporting  producers  made  a  claim  for  duty  drawback  on  the  grounds  that 
import charges were borne by the like product when intended for consumption in the 
exporting  country  but  were  refunded  when  the  product  was  sold  for  export  to  the 
Community. In each case the amount claimed was found to be higher than the amount 
of duty borne by the like product in the domestic market and therefore, the allowances 
were adjusted accordingly. 

(127)  After  disclosure  two  companies  objected  to  the  methodology  applied  concerning  the 
adjustment  for  duty  drawback,  partly  on  the  grounds  that  it  was  different  to  the  one 
used  in  the  original  investigation.  They  claimed  that  the  methodology  used  in  their 
replies to the questionnaire should be applied instead. 

(128)  The calculation method used by the companies, similar to the one used in the original 
investigation,  was  found  to  not  reflect  the  actual  import  level  of  duties  borne  by  the 
like product. It was therefore not in line with the requirements of Article 2(10)(b) of 
the  basic  Regulation  and  had  to  be  rejected.  The  methodology  used  in  the  present 
investigation was compatible with the conditions set out in Article 2(10)(b) insofar as 
it accurately reflected the actual import level of duties borne by the like product and 
was therefore considered as the most appropriate and thus maintained. 

(129)  In addition, all three exporting producers claimed credit costs on the basis of the actual 
credit period taken by customers under the ‘open account’ payment system used on the 
Korean  domestic  market.  It  was  found  that  under  such  a  system,  generally,  the 
exporting producers did not actually grant specific credit periods and furthermore, the 
credit periods taken could not be accurately determined, as receipts could not be linked 
to specific invoices. In these circumstances, these allowances could not be granted. 

(130)  After  disclosure,  two  companies  claimed  that  the  fact  that  they  use  an  open  account 
system is not in itself a reason to refuse the adjustment for credit costs. However, the 
investigation  has  shown  that  there  was  no  consistent  relation  between  prices  and  the 
credit terms reported. The companies could not demonstrate that specific credit terms 

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were agreed with the customer prior to the sale and that they had an effect on prices 
and price comparability. The exporting producers’ claims had therefore to be rejected. 

(131)  One  exporting  producer  requested  an  adjustment  for  differences  in  the  level  of  trade 
either  in  accordance  with  Article  2(10)(k)  (“other  factors”)  or  Article  2(10)(d)(ii)  of 
the Basic Regulation. Indeed, it was claimed that domestic sales were done mainly to 
end  users,  while  export  sales  to  the  Community  were  mainly  done  to  distributors. 
Although  there  were  sales  to  different  levels  of  trade  on  the  domestic  market  (end 
users  and  distributors),  the  company  was  not  able  to  quantify  the  appropriate 
adjustment.  The  company  claimed  later  that  the  adjustment  should  be  based  on  the 
difference of prices charged on the domestic market to end users and to distributors. 
However, the company was not in a position to demonstrate the existence of any such 
consistent and distinct difference in prices. Therefore, it was not possible to conclude 
that the difference in the level of trade affected price comparability and consequently 
this claim had to be rejected.  

(132)  One  exporting  producer  claimed  that  an  adjustment  for  differences  in  physical 
characteristics  was  warranted  on  the  basis  of  differences  in  the  denier  and  lustre 
between  product  types.  However,  the  company  could  not  substantiate  that  the 
difference in the denier and lustre affected price or price comparability and this claim 
had consequently to be rejected. 

9.4 Dumping margin 

(133)  The  comparison  of  the  weighted  average  normal  value  with  the  weighted  average 
export price by product type on an ex-factory basis for two of the exporting producers 
showed the existence of dumping. Moreover, with regard to one exporting producer, it 
should  be  noted  that  export  prices  on  the  last  month  of  the  IP  (‘the  second  time 
period’) were found to be in general and on average higher than those charged in the 
period  before  that  month  (‘the  first  time  period’).  While  export  prices  during  the 
second time period were high and mostly at non-dumped levels, significant dumping 
was practised in the first period as export prices were lower. Thus, there was a pattern 
of  export  prices  which  differed  significantly  between  the  first  and  the  second  time 
period of the IP. Furthermore, it was found that a comparison made on an average-to-
average  basis  would  not  reflect  the  significant  dumping  being  practised  in  the  first 
time  period  of  the  IP,  as  that  method  would  not  enable  significant  differences  in  the 
pattern  of  export  prices  between  the  first  and  the  second  time  period  of  the  IP  to  be 
taken  appropriately  into  account.  Therefore,  and  in  view  of  the  findings  referred  to 
under recital (134), it was concluded that the weighted average normal value should be 
compared  to  prices  of  all  individual  export  transactions  in  accordance  with  Article 
2(11)  of  the  basic  Regulation,  in  order  to  reflect  the  full  degree  of  dumping  being 
practised. 

(134)  For the reasons set out above in recital (44) a comparison of individual normal values 
and  individual  export  prices  on  a  transaction-by-transaction  basis  was  not  possible. 
Indeed, since the exporting producer concerned only issued one invoice per month and 
per  customer,  it  was  not  possible  to  find  a  reasonable  matching  between  individual 
export  transactions  and  individual  domestic  sales  transactions.  Thus,  the  comparison 
would  have  required  making  averages  between  prices  for  the  same  month  (which 
would  then  not  constitute  a  transaction-to-transaction  comparison),  or  to  proceed  to 
arbitrary choices of the export price to be chosen for comparison.  

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(135)  The exporting producer for which the weighted average normal value was compared to 
prices  of  all  individual  export  transactions  challenged  this  methodology.  Indeed,  the 
company  claimed  that  there  is  an  economic  justification  for  these  limited  number  of 
transactions made at non-dumped prices in the last month of the IP, and therefore it is 
not  justified  to  consider  that  a  pattern  of  export  prices  by  time  period  existed. 
However,  it  is  to  be  noted  that  the  economic  justification  of  these  invoices  – 
irrespective of whether or not such a justification is relevant in this context - could not 
be verified with the final customer which did not co-operate during the investigation. 
In addition, the claim by the exporting producer that there is an economic justification 
for  this  limited  number  of  transactions  is  in  contradiction  with  information  provided 
by the company itself, which claimed during the investigation that price compensation 
had  taken  place  after  the  IP.  Moreover,  the  dumping  margin  for  the  company  on  a 
weighted average to weighted average basis for the eleven months of the IP (excluding 
December),  and  for  the  first  semester  of  the  IP,  resulted  in  similar  levels  to  the  one 
found when using the weighted average to transaction methodology for the whole IP. 
Given the above, the methodology of comparing the weighted average normal value to 
the prices of all individual export transactions is appropriate in this case.  

(136)  For  co-operating  companies  not  included  in  the  sample,  the  dumping  margin  was 
established  on  the  basis  of  a  weighted  average  dumping  margin  calculated  for  the 
companies  selected  in  the  sample.  For  this  purpose,  Sung  Lim  Co.,  Ltd.,  whose 
dumping margin is de minimis, was not considered, in accordance with Article 9(6) of 
the Basic Regulation. 

(137)  The dumping margins established, expressed as a percentage of the CIF import price at 

the Community frontier, duty unpaid, are the following: 

– 

– 

– 

– 

– 

Huvis Corporation, Seoul 5.7 %, 

Saehan Industries Inc., Seoul 10.6 %, 

Sung Lim Co., Ltd., Kumi-si 0.9 % (de minimis), 

Co-operating companies not included in the sample 6.0 % 

All other companies 10.6 %. 

10. Taiwan 

(138)  Questionnaire replies were received from the two exporting producers selected in the 

sample. 

(139)  Both exporting producers initially submitted data for all products containing polyester. 
However, since the present review concerns only synthetic staple fibres of polyester, 
not  carded,  combed  or  otherwise  processed  for  spinning  which  are  currently 
classifiable  within  CN  code  5503  20  00  (i.e.  with  50%  or  more  of  polyester),  all 
products that were declared by the exporting producers as containing less than 50% of 
polyester were disregarded. 

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10.1 Normal value 

(140)  For both exporting producers, sales of the like product were representative. To a large 
extent,  normal  value  was  based  on  prices  paid  or  payable,  in  the  ordinary  course  of 
trade,  by  independent  customers  in  Taiwan,  in  accordance  with  Article  2(1)  of  the 
Basic  Regulation.  However,  for  those  product  types  where  the  domestic  sales  were 
insufficient or not made in the ordinary course of trade, normal value was constructed 
in accordance with Article 2(3) of the Basic Regulation, as explained in recital (34). 
SG&A and profit were based on actual data pertaining to production and sales, in the 
ordinary  course  of  trade,  of  the  like  product,  by  the  exporting  producer  under 
investigation, in accordance with the chapeau of Article 2(6) of the Basic Regulation.  

10.2 Export price 

(141)  For both exporting producers export prices were established on the basis of the prices 
actually  paid  by  unrelated  customers  in  the  Community  in  accordance  with  Article 
2(8) of the Basic Regulation. 

10.3 Comparison 

(142)  To  ensure  a  fair  comparison,  allowances  were  made  for  differences  in  transport, 
insurance, handling, loading and ancillary costs, packing costs, bank charges, rebates, 
discounts, credit costs and commissions where applicable and justified. 

10.4 Dumping margin 

(143)  The  weighted  average  normal  value  per  type  of  PSF  was  compared  to  the  weighted 
average export price of the corresponding type, in accordance with Article 2(11) of the 
Basic Regulation, on an ex-work basis and at the same level of trade. 

(144)  The  comparison  showed  the  existence  of  dumping  for  the  two  Taiwanese  exporting 
producers  investigated,  the  dumping  margin  being  equal  to  the  amount  by  which 
normal value, so established, exceeded the price for export to the Community. 

(145)  The dumping margins established, expressed as a percentage of the CIF import price at 

the Community frontier duty unpaid are the following: 

– 

– 

Nan Ya Plastics Corporation, Taipei 1.7 %, 

Far Eastern Textile Ltd., Taipei 1.8 %. 

(146)  Since both dumping margins are de minimis, i.e. less than 2%, and in accordance with 
the  Commission’s  consistent  practice,  the  proceeding  against  Taiwan  should  be 
terminated  without  the  imposition  of  measures,  should  the  circumstances  that  led  to 
these results be considered as lasting.  

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D. LASTING NATURE OF THE CHANGED CIRCUMSTANCES AND 
LIKELIHOOD OF CONTINUATION/RECURRENCE OF INJURIOUS DUMPING 

1. General 

(147)  In the framework of the interim review concerning Taiwan and the Republic of Korea, 
it was also examined whether the changed circumstances with respect to the original 
investigation regarding dumping and injury could reasonably be considered to be of a 
lasting nature in accordance with Article 11(3) of the Basic Regulation.  

(148)  Moreover,  with  regard  to  Taiwan  and  in  accordance  with  Article  11(7)  of  the  Basic 
Regulation, it was also examined whether it was likely that dumping would continue 
or recur should measures be repealed. 

2. The Republic of Korea 

(149)  As  mentioned  above,  the  current  investigation  showed  the  existence  of  dumping  for 
two of the three exporting producers selected in the sample, albeit at a lower level than 
in  the  original  investigation.  With  regard  to  the  third  exporting  producer,  as  in  the 
original investigation, dumping was found at a de minimis level.  

(150)  The analysis concerning the lasting nature of the changed circumstances with regard to 
dumping  took  into  account  the  production  capacity,  the  evolution  of  the  volume  of 
sales  on  the  domestic  market,  on  the  Community  market  and  on  the  export  to  other 
third countries market, as well as the prices of the product concerned sold on each of 
the  mentioned  markets  of  the  three  exporting  producers  in  the  Republic  of  Korea 
selected in the sample, which represented more than 80% of the exports of the product 
concerned to the Community during the IP.  

2.1 Production capacity 

(151)  The production volume of the product concerned has increased slightly by 3.5% since 
2001  (measures  were  imposed  in  December  2000),  while  production  capacity 
decreased by around 4%. Therefore, the capacity utilisation reached high levels (89% 
in 2001 and 95% during the IP) and spare capacities are low. Exporting producers did 
not  forecast  any  increase  in  production  for  the  next  years  and  one  of  the  largest 
exporters  of  the  product  concerned  to  the  Community  during  the  IP  even  stopped 
producing the product concerned after the IP.  

2.2 Sales volume 

(152)  The  domestic  market  remained  relatively  stable  during  the  last  years.  Although 
domestic  consumption  may  decrease  due  to  a  possible  shift  of  certain  PSF  users’ 
production  facilities  outside  Korea,  no  significant  and  immediate  change  of  the 
domestic  market  is  foreseeable.  Even  if  PSF  consumption  in  the  domestic  market 
would  decrease,  production  may  either  be  shifted  to  other  polyester  yarns,  which  is 
technically  quite  easily  feasible,  or  the  product  concerned  can  be  exported  to  other 
third  countries  without  or  with  lower  anti-dumping  duties  in  place  than  the 
Community market, or both. Furthermore, Korean producers are rather export oriented 
companies selling over 70% of their PSF production to third country markets. Given 
the  relatively  small  dependency  on  the  domestic  market,  a  decrease  of  domestic 

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30 

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consumption  would  not  significantly  affect  the  companies’  profitability.  Therefore, 
there  would  not  necessarily  be  an  urgent  need  to  expand  sales  to  other  customers 
outside  Korea  by  offering  PSF  at  lower  prices.  On  the  basis  of  the  information 
available, it can therefore not be concluded that a change in the size of the domestic 
market would automatically lead to an increase in exports of PSF to the Community at 
increasingly dumped prices.  

(153)  As  far  as  export  sales  to  other  third  countries  are  concerned,  these  have  been  stable 
over  the  last  three  financial  years,  representing  around  68%  of  the  total  sales  of  the 
product  concerned.  There  is  no  reason  to  believe  that  third  country  markets  cannot 
absorb further exports in future, in particular when PSF demand is increasing world-
wide  due  to  a  wider  application  of  the  product  concerned,  not  limited  anymore  to 
spinning or woven, but also increasingly to non-woven applications.  

(154)  Given  the  high  capacity  utilisation  rate  of  the  Korean  producers,  the  low  spare 
capacities  as  well  as  the  rather  stable  situation  on  the  domestic  and  other  export 
markets,  it  is  also  unlikely  that  a  decrease  of  the  level  of  anti-dumping  measures 
would  lead  to  a  significant  increase  of  imports  of  the  product  concerned  in  the 
Community.  

2.3 Sales prices 

(155)  It was examined whether a decreased dumping margin would likely lead to a decrease 
of  export  prices  which  may  result  in  higher dumping.  In  this  regard,  since  measures 
were in force and exports to the Community were done at a stable and substantial level 
despite these measures, there is no indication that lower dumping margins would entail 
lower export prices. On the contrary, it could be argued that lower dumping duties to 
be  paid  by  the  importers  would  create  a  possibility  for  the  companies  in  Korea  to 
increase their prices without changing the final price paid by the unrelated customer. 

2.4 Likely development of the normal value  

(156)  No  indications  could  be  found  that  the  normal  value  established  during  the  present 

review could not be considered to be of a lasting nature.  

(157)  It  could  be  argued  that  the  evolution  of  the  prices  of  the  raw  materials,  highly 
correlated to the oil prices, could have a significant influence on the normal value. It 
was  however  considered  that  since  the  raw  materials  are  commodities  for  which  the 
price is internationally determined, the effect of the increase in prices of raw materials 
would have the same effect on the export price as on the normal value, since all actors 
on the market would be affected in the same way. 

2.5 Conclusions for the Republic of Korea  

(158)  Given the above and in accordance with Article 11(3) of the basic Regulation, it was 
concluded that the changed circumstances that have led to the decrease of the dumping 
margin could be reasonably said to be of a lasting nature.  

(159)  As  far  as  the  company  is  concerned  for  which  a  de  minimis  dumping  margin  was 
found, it should be noted that this company was already subject to a 0% anti-dumping 
duty since imposition of the definitive measures in 2000. Nevertheless, despite the low 

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31 

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priced  imports  from  in  particular  the  PRC  and  Saudi  Arabia,  which  were  in 
competition with the Korean imports, no dumping could be found for this company in 
the present interim review. There is therefore no reason to believe that this company 
will change its export behaviour significantly in the future.  

(160)  In  view  of  the  finding  of  lower  dumping  margins  for  all  companies  concerned  in 
Korea and that this situation is not considered to be of a short term nature, measures 
imposed by Regulation (EC) No 2852/2000 should be amended accordingly.  

(161)  For the same reasons, the de minimis dumping margin for Sung Lim Co., Ltd. should 

be confirmed.  

3. Taiwan 

(162)  The analysis took into account the production capacity, the evolution of the volume of 
sales  on  the  domestic  market,  on  the  Community  market  and  on  the  export  to  third 
countries  (excluding  the  Community)  market,  as  well  as  the  prices  of  the  product 
concerned  sold  on  each  of  the  mentioned  markets  of  the  two  exporting  producers  in 
Taiwan selected in the sample, which represented more than 90% of the exports of the 
product concerned to the Community during the IP.  

3.1 Production capacity 

(163)  During  the  last  four  financial  years  the  production  capacity  of  the  two  exporting 
producers in Taiwan has decreased by around 6.5%. Although the capacity utilisation 
is overall of only 73%, this capacity utilisation has remained stable over time. On the 
basis  of  the  information  available,  it  appears  that  production  is  shifting  to  other 
countries  (Vietnam,  China)  where  productivity  is  better.  Therefore,  even  if  spare 
capacity  is  available,  an  increase  of  exports  to  the  Community  should  measures  be 
repealed is not very likely, because spare capacities will be rather transferred to other 
third countries.  

3.2 Sales volume  

(164)  Over the three last financial years, the main market for the product concerned for the 
exporting producers has not been the Community, but other third countries. The sales 
volumes to the Community market were still substantial as they accounted for 24% of 
the total sales quantity of the product concerned during the IP. Note, however, that this 
ratio has decreased over time (29% in 2001). Despite the measures in force by other 
third  countries  (China  and  Japan),  exports  to  third  countries  have  increased  by  14% 
over three years, representing in the IP 62% of the total sales quantity of the product 
concerned.  

(165)  Sales  on  the  domestic  market  during  the  last  three  financial  years  remained  stable, 

representing 13.4% of total sales of the product concerned during the IP.  

(166)  Considering  that  the  exporting  producers,  although  being  subject  to  anti-dumping 
measures  in  several  third  countries  have  continued  to  increase  their  exports  to  third 
countries other than the Community, and that they continued to maintain a substantial 
presence on the Community market, there is no clear indication that any spare capacity 
would  be  redirected  towards  the  Community  market  should  the  proceeding  against 

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32 

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Taiwan  be  terminated.  In  this  context,  it  is  also  concluded  that  the  transfer  of 
production  capacity  to  third  countries  is  unrelated  to  the  existence  of  trade  defence 
measures against imports originating in Taiwan. 

3.3 Sales prices on export markets 

(167)  A  price  comparison  was  made  between  the  prices  of  the  product  concerned  sold  for 
export  to  the  Community  and  for  export  to  third  countries  during  the  investigation 
period. 

(168)  It was found that for the global figures (including all types of the product concerned), 
the selling prices of the product concerned were significantly higher (more than 10% 
for the last three financial years) in the Community than in third countries. However, 
this price difference noted between the Community market and other export markets 
might be explained to a large extent by the existence of high price dispersions between 
the product types exported by the exporting producers. Moreover, since the quantities 
exported  to  the  Community  despite  the  existence  of  anti-dumping  measures  are 
significant, the termination of the measures could even give the exporters a margin to 
increase their export price. 

(169)  On this basis, there is no indication that the possibility for the companies to decrease 
prices to the Community is shown by the price level practised on other export markets.  

3.4 Likely development of normal value  

(170)  No  indication  had  been  found  that  could  point  to  a  change  of  normal  value.  The 
domestic  market  has  remained  stable  and  the  cost  situation  relating  to  the  domestic 
market has remained stable.  

(171)  As  far  as  the  influence  of  raw  material  prices  on  the  normal  value  is  concerned,  the 

conclusions of recital (157) apply also in the case of Taiwan. 

3.5 Conclusions for Taiwan 

(172)  The above analysis shows no indication that dumping would recur should measures be 

repealed. 

4.  Conclusion  on  the  likelihood  of  continuation/recurrence  of  (injurious) 

dumping 

(173)  The current measures in place regarding imports of PSF originating in the Republic of 
Korea  are  above  what  is  necessary  in  order  to  remove  the  injurious  effect  of  the 
dumped imports. Considering the likelihood that dumping would continue or recur if 
the  measures  were 
the  findings  of  dumping 
notwithstanding  the  measures  currently  in  force  against  the  Republic  of  Korea,  it  is 
concluded  that  the  measures  should  be  amended  and  set  at  the  levels  found  in  the 
current review.  

terminated  and  referring 

to 

(174)  The current measures in place regarding imports of PSF originating in Taiwan are no 
longer warranted. Considering that no element was found that there was a likelihood 
that dumping would continue or recur if the measures were repealed and referring to 
the  findings  on  dumping  (de  minimis)  resulting  from  the  current  review,  it  is 

EN 

33 

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concluded  that  the  proceeding  against  Taiwan  should  be  terminated  without  the 
imposition of measures.  

(175)  The  complainant  Community  industry  objected  to  the  proposed  termination  of  the 
anti-dumping  proceeding  against  imports  from  Taiwan.  It  was  claimed  that  the 
Taiwanese market as a whole should be analysed instead of merely the situation of the 
sampled  exporting  producers  because  the  non-sampled  companies  are  more  likely  to 
resume exports at dumped prices should measures be repealed. It was argued that the 
non-sampled companies, due to their bad financial situation, would very likely seek to 
maximise their cash-flow by increasing their export volume (at dumped prices) which 
would  also  be  confirmed  by  their  price  practices  concerning  exports  to  the  USA.  It 
was additionally claimed that, since the production capacity of these companies would 
represent  about  66%  of  the  Community  consumption,  the  impact  of  these  exports 
would be significant. 

(176)  It is noted that the selected sample represented not only 95% of Taiwanese exports to 
the  EU,  but  also  43%  of  the  Taiwanese  exports  to  other  countries,  71%  of  domestic 
sales  and  57%  of  the  domestic  production  of  PSF  and  was  therefore  largely 
representative  in  accordance with Article 17 of  the basic  Regulation. It is also noted 
that the complainant Community industry did not raise any objections to the sample at 
a prior stage of the proceeding.  

(177)  As  far  as  the  likelihood  of  recurrence  of  injurious  dumping  is  concerned,  the 
complainant Community industry based its arguments on mere allegations which were 
not supported by sufficient supporting evidence. Thus, in regard to the claim that non-
sampled  companies,  due  to  their  bad  financial  situation,  would  very  likely  seek  to 
maximise  their  cash-flow  by  increasing  their  export  volume  to  the  EU  at  dumped 
prices,  it  is  noted  that  cash  may  be  generated  through  several  different  means,  other 
than  increased  sales  volumes,  such  as  additional  borrowings,  selling  unprofitable 
business sectors and increasing the capital by issuing shares. Likewise, no convincing 
evidence has been submitted concerning the allegedly dumped prices of exports to the 
USA. Finally, the analysis of the complainant Community industry with regard to the 
production  capacity  in  Taiwan  does  not  take  into  account  any  possible  reduction  of 
capacity  in  Taiwan  due  to  dislocation  of  Taiwanese  production  facilities  outside 
Taiwan and the bankruptcy of one of the Taiwanese producers. 

(178)  Given the above, the conclusion as far as the likelihood of recurrence of dumping for 

Taiwan is concerned is maintained. 

E. INJURY 

1. Definition of the Community industry 

(179)  The following European Community producers have supported the complaint: 

- Catalana de Polimers, S.A, Spain 

- Dupont Sabanci Polyester GmbH, Germany 

- Industrias Químicas Textiles, S.A., Spain 

- Tergal Fibres, S.A., France 

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34 

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- Trevira GmbH, Germany  

- Wellman International Limited, Ireland 

(180)  As  these  six  complainant  co-operating  Community  producers  represent  49%  of  the 
Community  production  of  the  product  concerned,  and  since  no  non-complainant 
Community producer has expressly manifested its opposition against the initiation of 
the present proceeding, it is considered that the complainant producers constitute the 
Community  industry  within  the  meaning  of  Articles  4(1)  and  5(4)  of  the  Basic 
Regulation.  Two  non-complainant  producers  provided  general  information  to  the 
Commission, but did not support the complaint. 

2. Community consumption 

(181)  Community consumption was established on the basis of the volume of imports of the 
product  concerned  from  the  countries  concerned  and  from  all  other  third  countries 
known  to  produce  and  export  the  product  concerned  to  the  Community,  plus  the 
volume of sales in the Community market of both the Community industry and other 
Community producers. As only two out of 10 non-complainant Community producers 
submitted information on their sales, the sales of the remaining eight non-complainant 
producers  were  calculated  further  to  data  reported  in  the  complaint  lodged  by  the 
Community industry. These data were corroborated by publications of an independent 
consultancy firm specialised in the fibres sector.  

(182)  For  the  sake  of  consistency,  Eurostat  was  used  in  order  to  determine  the  volume  of 
imports on the relevant CN codes in the present proceeding. Note that the volume of 
imports  reported  by  producers  in  the  exporting  countries  concerned  was  in  line  with 
the corresponding Eurostat figures. 

(183)  On this basis, Community consumption has stagnated, passing from 712,773 tonnes in 

2000 to 709,828 tonnes in the IP. 

Table 1 

2000 

2001 

2002 

IP 

Community  consumption 
(tonnes) 

712,773

661,227

729,916

709,828 

100 

94 

102 

99  

3. Imports of PSF from the countries concerned 

3.1 Cumulation  

(184)  As regards Taiwan, the dumping margin found amounted to less than 2% (see recitals 
(138)  to  (146)  above).  Therefore,  the  conditions  set  out  in  Article  3(4)  of  the  Basic 
Regulation to assess cumulatively imports of the product concerned from this country 
with  imports  of  the  product  concerned  from  the  remaining  countries  under 
consideration were not fulfilled.  

(185)  The Commission considered further whether the effects of imports of PSF originating 
in  the  PRC,  Saudi  Arabia  and  South  Korea  (hereinafter:  the  ‘countries  concerned’) 

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35 

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should  be  assessed  cumulatively  in  accordance  with  Article  3(4)  of  the  Basic 
Regulation.  

(186)  This  Article  provides  that  the  effects  of  imports  from  two  or  more  countries 
simultaneously subject to the same investigation shall be cumulatively assessed when 
(i) the margin of dumping established in relation to the imports from each country is 
more  than  de  minimis  as  defined  in  Article  9(3)  of  the  Basic  Regulation,  (ii)  the 
volume  of  imports  of  each  country  is  not  negligible  and  (iii)  the  conditions  of 
competition between the imported products and the conditions of competition between 
the  imported  products  and  the  like  Community  product  make  such  an  assessment 
appropriate.  

3.1.1 Margin of dumping and volume of imports 

(187)  As  indicated  above,  the  present  investigation  has  shown  that  the  dumping  margins 
established for the PRC, Saudi Arabia and South Korea are well above the de minimis 
level, and the volume of imports from said countries is not negligible in the sense of 
Article 5(7) of the Basic Regulation (their market shares attaining respectively 4.7%, 
3.1% and 10% in the IP).  

3.1.2 Conditions of competition 

(188)  In  order  to  determine  the  appropriateness  of  a  cumulative  assessment  in  view  of  the 
conditions  of  competition  between  imported  products  and  the  like  Community 
product,  the  Commission  has  initially  analysed  the  exporters’  market  behaviour  in 
terms of export prices and volumes.  

(189)  Similar  market  behaviour  of  PRC,  Saudi  Arabian  and  South  Korean  producers  in 
terms  of  export  prices  was  found.  In  fact,  said  countries  have  decreased  their 
respective average unit selling prices of  PSF  by  27%,  23% and 15%, throughout the 
period under consideration. In addition, a very similar level of undercutting has been 
determined for imports of all the three countries (see below, recital (200)).  

(190)  Likewise, all three countries hold significant market shares in the Community market 
although  South  Korea  is  by  far  the  most  important  exporting  country  of  the  three 
countries concerned (in the IP, 4.7% in the case of the PRC, 3.1% in the case of Saudi 
Arabia and 10% in the case of South Korea).  

(191)  The investigation also determined that imports from the PRC, Saudi Arabia and South 
Korea into the Community used the same sales channels, as in the vast majority, said 
imports are traded through distributors, rather than sold to final customers 

(192)  Furthermore,  as  explained  above  (see  recitals  (22)  and  following)  it  has  been  found 
that the product concerned imported from the PRC, Saudi Arabia and South Korea and 
produced  by  the  Community  industry  share  the  same  basic  technical,  physical  and 
chemical characteristics, and are to be considered alike in terms of interchangeability 
and substitutability, thus competing with each other on a type by type basis. 

(193)  One  exporting  producer  from  Saudi  Arabia  claimed  that  PSF  imported  from  said 
country is not in competition with PSF as manufactured by other countries concerned, 
in  particular  the  PRC,  and  by  the  Community  industry.  Pursuant  to  this  producer’s 

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submissions, Saudi Arabian production of PSF is exclusively concentrated in the basic 
or  regular  PSF,  namely  those  types  of  products  which  are  not  suitable  for  specific 
applications,  but  rather  for  general  use  while  producers  in  the  PRC  and  Community 
producers have the capacity or actually produce so called “speciality” products. These 
speciality  products  of  PSF  are  normally  branded  and  tailored  for  particular 
applications or final uses, such as fire retardant, anti-bacterial or non-pilling fibres and 
require  normally  advanced  R&D.  Some  users  further  alleged  that  the  so-called 
“hollow conjugate” type, which the mentioned users have considered as a “speciality 
product”, is only supplied in the Community by South Korean producers.  

(194)  These arguments were not borne out by the investigation. First of all, it was found that 
exports from the PRC consist of exclusively basic or regular PSF. Secondly, exports of 
PSF  from  South  Korea  are  not  concentrated  in  the  “hollow  conjugate”  type,  as  this 
latter represents only a 24% of total exports to the European Community for the IP. In 
addition,  according  to  the  definition  of  “speciality”  types  laid  down  above,  “hollow 
conjugate” PSF cannot be considered as a speciality type. Indeed, technical evidence 
has been obtained showing that all PSF producers are normally able to produce hollow 
conjugate  PSF  but  most  of  them  refrain  from  doing  so  because  the  production  is  no 
longer  sustainable  in  view  of  the  prevailing  price  levels.  Finally,  although  the 
Community  industry  produced  and  sold  “speciality”  products,  its  PSF  business  is 
mainly concentrated in the basic or regular PSF segment.  

(195)  Thus,  it  was  established  that  exports  of  the  product  concerned  from  the  countries 
concerned  compete  with  each  other  and  with  PSF  manufactured  or  susceptible  of 
being produced by the Community industry.  

(196)  On  the  basis  of  the  above,  it  was  concluded  that  all  conditions  justifying  the 
cumulation of imports of PSF originating in the PRC, Saudi Arabia and South Korea 
were met.  

3.2 Cumulated volume and market share 

(197)  Cumulated  dumped  imports  from  the  PRC,  Saudi  Arabia  and  South  Korea  have 
increased from 111,905 tonnes in 2000 to 125,633 tonnes in the IP, i.e. by 12%.  

(198)  Cumulated market shares have increased from 15.6% in 2000 to 17.6% during the IP.  

Table 2 

PRC,  SAUDI  ARABIA  & 
SOUTH KOREA 

2000 

2001 

2002 

IP 

Imports (tonnes) 

111,905

89,457

120,847

125,633 

Index 

100 

79 

107 

112 

Market Share  

15.6%

13.5%

16.5%

17.6% 

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3.3 Prices and Undercutting 

(199)  The  weighted  average  price  of  the  dumped  imports  originating  in  the  PRC,  Saudi 

Arabia and South Korea has declined by 18% between 2000 and the IP. 

Table 3 

PRC,  SAUDI  ARABIA  &  SOUTH 
KOREA 

2000 

2001 

2002 

IP 

Weighted average price (€/kg) 

1.08

1.07

0.9689

0.89 

Index 

100 

99 

88 

82 

(200)  For the determination of price undercutting, the Commission analysed data referring to 
the IP. The relevant sales prices of the Community industry were those to independent 
customers, adjusted where necessary to an ex-works level, i.e. excluding freight costs 
in the Community and after deduction of discounts and rebates. Prices for the different 
product  types  of  PSF  defined  in  the  questionnaires  were  compared  with  the  sales 
prices  charged  by  the  exporters,  net  of  discounts,  by  applying  the  necessary  and 
warranted adjustments to bring the prices to CIF Community frontier level.  

(201)  During the IP, the weighted average undercutting margin was 16% for the PRC, 16.8% 

for Saudi Arabia and 24% for South Korea. 

4. Situation of the Community industry 

4.1 Production 

(202)  Production  in  volume  by  the  Community  industry  has  decreased  by  5%  during  the 

period under consideration.  

Table 4 

2000 

2001 

2002 

IP 

Production (tonnes) 

236,902

229,598

225,290 

224,649 

Index 

100 

97 

95 

95 

4.2 Capacity of production and capacity utilisation rates 

(203)  Capacity  of  production  of  PSF  has  been  kept  stable  during  the  period  under 
consideration. Indeed, capacity of production has only increased from 271,466 tonnes 
in 2000 to 277,561 tonnes in the period under consideration. During the IP, capacity of 
production  of  the  Community  industry  amounts  to  36%  of  total  Community 
consumption.  

(204)  Capacity utilisation rates have diminished by 6 percentage points from 87% to 81%. 
As  capacity  of  production  has  not  decreased  itself,  this  decline  in  the  capacity 
utilisation  is  merely  due  to  the  decrease  in  production  volumes  of  the  Community 
industry.  

EN 

38 

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Table 5 

2000 

2001 

2002 

IP 

Capacity of production (tonnes) 

271,466

272,561

277,561

277,561 

Index  

100 

100 

102 

102 

Capacity utilisation 

87% 

84%

81%

81% 

4.3 Stocks 

(205)  Stocks have increased during the period under consideration by 13%. However, this is 
not  considered  as  an  indication  for  injury  as  the  stock  levels  reflect  the  Community 
industry’s policy to keep stocks at a level basically equalling one month’s production.  

Table 6 

2000 

2001 

2002 

IP 

Stocks (tonnes) 

20,560

22,301

21,592 

23,317 

Index 

100 

108 

105 

113 

4.4 Investments 

(206)  Investments determination was based on information provided by 5 of the companies. 
The  sixth  company  did  not  provide  reliable  information.  During  the  period  under 
consideration, the five companies providing reliable investment data have carried out 
investments  for  a  value  of  EUR  34.5  million.  As  can  be  seen  in  table  7  below, 
investments  have  had  an  increasing  trend  except  in  2002,  when  they  declined  with 
respect  to  the  previous  year.  However,  it  was  found  that  these  investments  almost 
exclusively  consisted  of  replacements.  Major  part  of  the  investments  was  directly 
related  to  the  manufacture  of  the  product  concerned.  Only  one  of  the  Community 
industry  producers has carried  out significant  investments in  a recycling  plant  which 
provides raw material (polyethylene terephthalate -PET- flakes) to the PSF production 
process. 

(207)  It is considered that the level and nature of the investments (mainly replacements) is 

low for a capital intensive industry.  

Table 7 

2000 

2001 

2002 

IP 

Investments  (EUR) 
(5 of 6 companies) 

Index 

4,325,661

12,850,473

5,833,264

11,522,994 

100 

297 

132 

238 

4.5 Sales and market share 

(208)  PSF sales by the Community industry in the European Community have declined by 
6%  from  2000  to  the  IP.  As  Community  consumption  increased  by  11%  during  the 

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period  under  consideration,  such  decrease  of  sales  has  been  translated  in  a  loss  of 
market shares. In particular, market share of the Community industry has passed from 
31% to 29% in the IP. 

Table 8 

2000 

2001 

2002 

IP 

Sales in the EC (tonnes) 

220,695

213,322

211,609

206,926 

Index  

100 

97 

96 

94 

Market share 

31% 

32%

29%

29% 

4.6 Prices 

(209)  The  Community  industry’s  unit  selling  price  has  decreased  by  8%  during  the  period 
under consideration. As shown in table 9 below, such decrease took place after 2001, 
coinciding  with  the  surge  of  imports  from  the  countries  concerned  and  the 
considerable decrease of prices of such imports.  

Table 9 

2000 

2001 

2002 

IP 

Weighted average price (€/kg) 

1.48

1.49

1.38

1.36 

Index 

100 

101 

93 

92 

4.7 Profitability 

(210)  The  weighted  average  profitability  on  net  turnover  of  the  Community  industry 

decreased from 4.4% in 2000 to –3.2% in the IP. 

Table 10 

2000 

2001 

2002 

IP 

Weighted 
profitability on net turnover 

average 

4.4%

1.2%

-2.9%

-3.2% 

4.8 Cash flow and return on net assets  

(211)  Cash flow has diminished during the period under consideration from 25.687.824 € in 

2000 to 12.178.328 € in the IP.  

(212)  Return on net assets was based on information provided by 5 of the companies. The 
sixth company did not provide reliable information. However its global return on net 
assets data followed the same trend as the one found for the product concerned in the 
other five companies. The information provided showed a dramatic decrease in return 
on net assets during the period under consideration. Indeed, it passed from 51.1% in 
2000 to -8.5% in the IP. 

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Table 11 

2000 

2001 

2002 

IP 

Cash flow (€) 

25,687,824

17,843,711

14,511,142

12,178,328 

Index  

100 

70 

56 

47 

Weighted  return  on  net 
assets (5 out of 6 companies) 

51.1% 

19.9%

47.4%

-8.5% 

4.9 Ability to raise capital 

(213)  Some companies finance their activities from within the financial group to which they 
belong  either  through  cash  pooling  schemes  or  through  intra-group  loans  granted  by 
the mother companies. In other cases, cash flow generated by the company is used as a 
source of financing. Some others increased their equity by entering into capital venture 
structures  with  financial  entities,  which  in  certain  instances  further  financed  their 
participating companies by means of shareholder loans. 

(214)  On  this  basis,  most  Community  industry  companies  have  not  shown  any  major 
difficulties to raise capital. However, one of the verified companies has found severe 
problems to finance its activities, both in debt and equity.  

4.10 Employment and wages 

(215)  Employment  in  the  Community  industry  decreased  by  7%  during  the  period  under 
consideration. Indeed, Community industry reduced staff by 84 workers. Concerning 
wages, for year 2000, one of the companies did not provided reliable information. For 
the rest of the years comprised in the period under consideration, total wages increased 
5%  far  below  the  average  increase  during  the  period  under  consideration  of  the 
harmonised  index  of  consumer  prices  for  the  four  countries  where  Community 
industry is located (i.e. 9.1%). 

Table 12 

2000 

2001 

2002 

IP 

Employees 

Index  

Weighted  average  salary 
(€/year)  (5  out  of  six 
companies in 2000) 

4.11 Productivity 

1,270

100 

1,223

1,227

1,186 

96 

97 

93 

31,993

40,340

41,054

42,430 

100 

102 

105 

(216)  Productivity for the total market was stable during the period under consideration, as it 
has  only  decreased  by  2%  from  2000  until  the  IP.  This  stagnation  in  productivity 
mirrors the low level of investments carried out by the Community industry (in quality 
and in quantity, see above recitals (206) and following). 

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Table 13 

2000 

2001 

2002 

IP 

Productivity 
(tonnes/employee) 

Index 

4.12 Growth 

195

195

190

192 

100 

100 

97 

98 

(217)  Overall,  it  has  to  be  noted  that  the  Community  industry’s  market  shares  fell  by  2 
percentage points, which shows that its growth lagged behind the decreasing level of 
consumption of the overall market (which decreased by 1%).  

4.13 Magnitude of the dumping margin and recovery from past dumping 

(218)  As  concerns  the  impact  on  the  Community  industry  of  the  magnitude  of  the  actual 
margin  of  dumping,  given  the  volume  and  the  prices  of  the  imports  from  the  PRC, 
Saudi Arabia and South Korea, this impact cannot be considered negligible. 

(219)  On  the  other  hand,  it  is  considered  that  the  significant  increase  of  dumped  imports 
from  the  PRC  and  Saudi  Arabia  to  the  Community  together  with  the  unsatisfactory 
evolution  in  terms  of  prices  of  imports  from  South  Korea  have  prevented  the 
Community industry’s expected recovery from the effects of past dumping. 

5. Conclusion on injury 

(220)  Imports  volumes  from  the  PRC,  Saudi  Arabia  and  South  Korea  have  increased 
considerably, both in absolute terms and in terms of market share. Indeed, during the 
period  under  consideration,  they  gained  2  percentage  points  in  market  share. 
Moreover, the  weighted  average price  of imports from these countries has decreased 
by  18%  over  the  period  under  consideration.  This  decrease  is  mirrored  in  the 
significant price undercutting found. 

(221)  Most  of  the  Community  industry  injury  indicators  have  shown  a  negative  evolution 
during the period under consideration, which points to a situation of  material injury: 
whereas  total  Community  consumption  of  PSF  has  stagnated,  the  Community 
industry’s  total  sales  in  volume  have  decreased  by  6%,  with  a  corresponding  loss  in 
market shares of 2 percentage points; production in volume has decreased; capacity of 
production has stagnated and capacity utilisation has diminished by 6%; average unit 
selling  price  has  decreased  by  8%;  profitability  on  net  turnover  has  yielded  negative 
results, being reduced by 7.6 percentage points during the period under consideration; 
other  profitability  related  indicators  as  cash  flow  and  return  on  net  assets  have  also 
deteriorated  during  the  period  under  consideration;  employment  and  productivity 
decreased by 7 % and 2 % respectively. The positive developments in investments and 
wages do not put into question the overall injurious picture of the Community industry 
as  the  investment  levels  were  low  for  such  a  capital-intensive  industry  and  as  the 
increase  in  wages  essentially  compensated  for  the  inflation  during  the  period  under 
consideration. 

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(222)  Based  on  the  foregoing,  it  follows  that  the  Community  industry  is  in  a  difficult 
economic and financial situation and has suffered material injury within the meaning 
of Article 3 of the Basic Regulation. 

F. CAUSATION 

1. Introduction 

(223)  In  accordance  with  Article  3(6)  and  (7)  of  the  Basic  Regulation,  it  was  examined 
whether the material injury suffered by the Community industry had been caused by 
the  dumped  imports  from  the  countries  concerned.  Furthermore,  in  accordance  with 
Article  3(7)  of  the  basic  Regulation  known  factors  other  than  the  dumped  imports, 
which might have injured the Community industry, were examined to ensure that any 
injury caused by those factors was not wrongly attributed to the dumped imports.  

2. Effect of the dumped imports 

(224)  Imports  from  the  countries  concerned  have  increased  during  the  period  under 
consideration,  by  12  %  in  terms  of  volume,  and  by  2  percentage  points  in  terms  of 
market share. Prices of imports originating in the PRC, Saudi Arabia and South Korea 
decreased  by  18%  and  considerably  undercut  Community  industry  prices  by  16%, 
16.8% and 24% respectively.  

(225)  The increase in the volume of imports originating in the PRC, Saudi Arabia and South 
Korea and their gain in market share, at prices which remained well below those of the 
Community  industry,  coincided  in  time  with  the  deterioration  of  the  situation  of  the 
Community industry.  

(226)  The  Community  industry’s  sales  in  volume  and  market  shares  have  fallen.  Sales  in 
volume have decreased by 6% and market shares diminished by 2 percentage points. 
The Community industry’s loss of market share was fully taken over by the dumped 
imports from the PRC, Saudi Arabia and South Korea.  

(227)  The  decrease  of  Community  industry  prices  occurred  in  parallel  to  the  constantly 
decreasing  trend  of  prices  for  the  product  concerned  imported  from  the  PRC,  Saudi 
Arabia  and  South  Korea.  In  particular,  Community  industry  prices  started  to  decline 
after  2001,  at  the  same  time  when  the  average  import  prices  from  the  PRC,  Saudi 
Arabia and South Korea declined (see above in recitals (199) and (209), and tables 3 
and  9  respectively).  The  price  suppressing  effect  of  the  dumped  imports  could 
therefore be clearly established.  

(228)  Profitability  of  the  Community  industry  has  dramatically  deteriorated  as  from  the 
beginning of the period under consideration and was negative in 2002 and during the 
IP.  The  losses  of  the  Community  industry  from  2002  onwards  coincided  with  the 
increase of the PSF imports from the countries concerned at particularly low prices. It 
should  also  be  noted  that  one  of  the  Community  industry  producers  showed  that  its 
profitability  on  net  turnover  for  so  called  basic  or  regular  products,  i.e.  where  the 
Community industry is exposed the most to competition from the countries concerned, 
deteriorated  to  a  higher  degree  than  the  profitability  including  all  types  of  PSF 
products manufactured by this producer. 

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(229)  The progressive increase of import volumes from the countries concerned at dumped 
prices  also  coincided  with  the  negative  evolution  of  other  indicators  showing  the 
injurious situation of the Community industry, such as the unfavourable development 
of employment, capacity of production and capacity utilisation. 

(230)  Based on the above considerations, it is concluded that that the dumped imports form 
the countries concerned had a determining role in the deterioration of the situation of 
the Community industry. 

3. Effect of other factors 

3.1 Development of consumption  

(231)  As  mentioned  in  recital  (183),  from  2000  to  the  IP,  consumption  in  the  Community 

market remained stable. Thus, this cannot be a source of injury.  

3.2 Lack of investments by the Community industry 

(232)  The  downstream  industry  argued  repeatedly  that  the  Community  industry  failed  to 
invest  in  a  modernised  production  process  and  would  therefore  be  (at  least  partly) 
responsible for its injurious situation. Indeed, as indicated above in recital (207), it is 
considered  that  the  level  and  nature  of  the  investments  (mainly  replacements  and 
maintenance) is low for a capital intensive industry. 

(233)  However, given the circumstances described supra, in recitals (202) and following, the 
Community  industry  was  not  in  a  position  to  make  substantial  new  investments.  As 
can  be  seen  from  the  analysis  made  in  this  section,  no  circumstances  other  than  the 
dumped  imports  were  found  which  had  a  significant  negative  impact  on  the 
Community industry. In these circumstances, insufficient levels of investment should 
not  be  seen  as  the  cause  of  the  injury  but  rather  as  a  further  effect  of  the  dumped 
imports. 

3.3 Imports from other third countries 

(234)  During  the  IP,  PSF  was  also  imported  from  the  United  States,  Turkey,  Japan,  the 
Czech Republic, Poland, Nigeria and South Africa. In the analysis of whether imports 
from  other  countries  might  have  injured  the  Community  industry,  the  imports  from 
Taiwan were also included. As mentioned above in recital (145) above, imports from 
Taiwan were made at de minimis dumping levels during the IP.  

(235)  Import  volumes  from  other  third  countries slightly increased from 133,798 tonnes in 
2000  to  137.123  tonnes  in  the  IP.  This  small  increase,  together  with  the  stable 
consumption of PSF has been translated into stagnating market shares for imports of 
third countries other than the ones concerned (19% in 2000 and in the IP).  

(236)  Furthermore,  according  to  Eurostat  data  and  to  data  verified  on  spot,  for  the  IP, 
weighted  average  prices  of  the  product  concerned  originating  in  the  rest  of  the  main 
exporting countries (1.25 €/kg.) were  at  a very similar level to the weighted  average 
prices of the Community industry. Therefore, it is concluded that these imports cannot 
have caused any injury to the Community industry. 

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44 

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(237)  Some exporting producers have alleged that Turkish exports into the Community are 
made at dumped prices which would have contributed to the injurious situation of the 
Community industry. 

(238)  The  vast  majority  of  Turkish  imports  of  PSF  into  the  Community  are  distributed  by 
one of the complainant companies, which is related to the Turkish exporting producer. 
However,  evidence  has  been  obtained  that  purchases  of  PSF  by  the  complainant 
company  from  its  Turkish  related  company  were  made  at  arm’s  length  and  aimed  at 
supplementing the product range of the Community producer in question in periods of 
intensive  market  demand.  Furthermore,  these  imports  were  not  caused  by  any 
abandoned or delayed investment projects susceptible of having provoked a reduction 
in the production capacity of the Community related company. It was further verified 
that the resale of PSF of Turkish origin by the related Community importer was made 
at  the  same  price  level  as  products  manufactured  and  sold  by  such  related  company 
and did not undercut average prices of the other Community industry companies. 

3.4 Non complainant Community producers  

(239)  Non-complainant Community producers of the product concerned held a market share 
of  31.5%  during  the  IP.  During  the  period  under  consideration,  their  sales  volume 
decreased by 7% and their market share declined by 2 percentage points. 

(240)  In addition, pursuant to information available, there are indications that average prices 
of  non  complainant  producers  are  at  the  same  level  as  the  complainant  producers’ 
average  prices.  This  suggests  that  they  are  in  a  similar  situation  to  the  Community 
industry,  i.e.  that  they  have  suffered  injury  from  the  dumped  imports.  Therefore,  it 
cannot  be  concluded  that  other  Community  producers  caused  material  injury  to  the 
Community industry. 

3.5 Fluctuation of raw material prices  

(241)  The  cost  of  raw  materials  is  a  substantial part of the total  cost  of production of PSF 
(about 60% of total cost of production). As a result, PSF prices are highly dependant 
on the influence of raw material costs.  

(242)  The  production  of  so  called  virgin  PSF  is  made  out  of  derivatives  of  petroleum 
(mainly mono ethylene glycol – MEG - and purified terephthalic acid – PTA -). To a 
lesser,  but  increasing  extent,  the  Community  industry  manufactures  so  called 
regenerated PSF out of recycled materials (polyethylene terephthalate – PET - bottles 
and other waste). Finally, PSF can be made out of a combination of both kinds of raw 
materials, derivatives of petroleum and recycled PET waste.  

(243)  Prices of MEG and PTA, as derivatives of petroleum, depend on the price fluctuations 
of this latter. As found in the verification visits, the evolution of the price of recycled 
materials is usually linked to the fluctuation of MEG and PTA prices.  

(244)  Based  on  the  above,  some  exporting  producers  have  claimed  that  injury  allegedly 
suffered  by  the  Community  industry  has  been  caused  by  the  fluctuations  of  raw 
material costs, in particular by the world-wide price increase of petroleum.  

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45 

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(245)  In  this  respect,  pursuant  to  information  supplied  by  raw  material  producers,  it  was 
found  that  prices  of  MEG  and  PTA  increased  from  2002  until  the  end  of  the  IP  by 
14%  and  13%  respectively.  However,  this  increase  in  raw  materials  prices  was  not 
reflected in an increase of the average price of PSF sold by the Community industry 
(see  above  recital  (209)),  despite  the  fact  that  fibres  are  price  sensitive  products.  On 
the  contrary,  EU  producers’  prices  fell  slightly  over  the  same  period.  While  third 
country producers of the product concerned can also be expected to have seen similar 
prices  increases  for  the  main  petroleum-based  inputs  such  as  MEG  and  PTA,  it  was 
found that import prices of PSF from the countries concerned decreased significantly 
during the same period. It was found, that the Community producers were not able to 
pass  on  any  increased  raw  material  costs  to  their  customers  due  to  the  competition 
from dumped imports. 

(246)  In  addition,  any  possible  impact  of  the  fluctuations  of  raw  material  prices  on  PSF 
prices is susceptible to affect both the Community industry and the exporters located 
in the countries concerned, as petroleum is a commodity with homogeneous pricing all 
around the world. Accordingly, the above claim was rejected. 

3.6 Currency fluctuations 

(247)  Attention was paid to currency fluctuations between the EURO and the USD. The vast 
majority  of  import  transactions  from  the  countries  concerned  into  the  European 
Community are negotiated in USD. The EURO has been appreciated in respect of the 
USD as from mid 2002, and significantly during the IP, thus favouring exports into the 
EURO area for that period. In view of this, some interested parties have claimed that 
in a “dollar driven” business, the depreciation of this currency in respect of the EURO 
must have “inevitably” favoured imports of PSF into the European Community.  

(248)  In  the  particular  case  of  PSF,  imports  from  countries  other  than  those  found  to  be 
dumping  have  also  benefited  from  the  appreciation  of  the  Euro.  However,  their 
volumes  stagnated  during  the  period  under  consideration  (even  slightly  decreasing 
from year 2002 to the IP), while imports from the dumping countries have increased 
throughout the same period by 12%. Although prima facie it cannot be excluded that 
the appreciation of the EURO vis-à-vis the USD might have favoured the imports of 
PSF from the countries concerned, the fact that currency fluctuations did not have an 
effect  on  imports  from  other  countries,  indicates  that  it  can  not  be  considered  as  a 
causal factor for the surge of dumped imports from the countries concerned.  

(249)  In  addition,  any  allegation  of  EURO  appreciation  in  respect  of  USD  as  a  cause  of 
injury  of  the  Community  industry  should  be  valid  only  for  the  period  where  said 
appreciation  took  place,  i.e.  from  mid  2002  until  the  end  of  the  IP,  and  in  particular 
during  this  latter,  when  differences  among  both  currencies  have  been  more 
accentuated. 

(250)  Therefore, it was concluded that, although the appreciation of the EURO in respect of 
the USD might have favoured exports of PSF into the European Community, it does 
not explain the significant increase of import volumes from the countries concerned as 
compared to the rest of world importers.  

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4. Conclusion on causation 

(251)  The  coincidence  in  time  between,  on  the  one  hand,  the  increase  of  dumped  imports 
from the countries concerned, the increase in market shares and the undercutting found 
and, on the other hand, the deterioration of the situation of the Community industry, 
lead  to  the  conclusion  that  the  dumped  imports  are  a  cause  of  the  material  injury 
suffered by the Community industry. In particular, a chronological parallel evolution 
of decreasing average prices of imports and Community industry suppressed average 
prices has been found. This has led to a diminishing profitability for the year 2002 and 
the  IP,  i.e.  when  imports  from  the  countries  concerned  grew  the  most  and  prices 
decreased most dramatically, yielded negative results. 

(252)  After  analysing  some  factors,  such  as  development  of  consumption,  imports  from 
countries  other  than  the  concerned,  the  market  behaviour  of  non-complainant 
producers and the low level of investments carried out by the Community industry, it 
is concluded that they cannot have caused material injury to the Community industry. 
On  the  other  hand,  although  it  cannot  be  excluded  that  other  factors,  such  as  the 
fluctuation of raw material prices and the currency fluctuations could have contributed 
to the  injurious situation of the Community industry, the effect of said factors is not 
such as to alter the finding that there is genuine and substantial causal link between the 
dumped imports from the countries concerned and the material injury suffered by the 
Community industry. 

G. COMMUNITY INTEREST 

1. Preliminary remark 

(253)  In accordance with Article 21 of the Basic Regulation, it was considered whether the 
imposition  of  anti-dumping  measures  would  be  contrary  to  the  interests  of  the 
Community as a whole. The determination of the Community interest was based on an 
examination of all the various interests involved, i.e. those of the Community industry, 
the importers, traders and the users of the product concerned. 

(254)  In order to assess the likely impact of the imposition or non-imposition of measures it 
was requested information from all interested parties which were either known to be 
concerned  or  which  made  themselves  known.  On  this  basis,  the  Commission  sent 
questionnaires  to  the  Community  industry,  10  other  Community  producers,  23  users 
and 3 suppliers of raw materials. The 6 complainant Community industry producers, 2 
non-complainant  producers,  5  related  importers,  15  users  and  2  providers  of  raw 
materials replied to the questionnaire9. 

(255)  31 unrelated importers were known at the initiation of the proceedings. In view of that 
large  number  of  unrelated  importers  and  in  conformity  with  Article  17  of  the  Basic 
Regulation,  the  Commission  decided  to  carry  out  its  investigation  on  the  basis  of  a 
sample of said unrelated importers. The sample was selected on the basis of the largest 
representative  volume  of  imports  concerned  which  could  reasonably  be  investigated 
within the time available.  

9 

One of the co-operating non-complainant producers has manifested that its total PSF production is not 
sold to the open market but to related companies, as captive sales.  

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47 

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(256)  To that purpose, five companies were initially selected for the sample, based on their 
volume of imports from the countries concerned. One of the five selected companies 
was subsequently considered as non co-operating given that it refrained to fill in the 
full questionnaire sent to it and then disregarded as part of the sample. The remaining 
four sampled companies covered 14.6% of total imports concerned. The final sample 
consisted of the following companies: 

- S.I.M.P., SpA, Italy 

- Highams Group Ltd., United Kingdom 

- Tob Herman Industries, N.V., Belgium 

- Marubeni Europe plc, Hamburg Branch, Germany 

(257)  On  this  basis,  it  was  examined  whether,  despite  the  conclusions  on  dumping,  on  the 
situation  of  the  Community  industry  and  on  causation,  compelling  reasons  existed 
which  would  lead  to  the  conclusion  that  it  was  not  in  the  Community  interest  to 
impose measures in this particular case. 

2. Community industry 

(258)  The Community industry has suffered material injury, as set out above in recitals (202) 

and following.  

(259)  The  imposition  of  anti-dumping  measures  would  allow  the  Community  industry  to 
reach  the  levels  of  profitability  which  it  would  have  been  able  to  achieve  in  the 
absence of dumped imports, and to take advantage of developments in the Community 
market. This would guarantee the viability of the Community industry PSF business.  

(260)  In  fact,  although  the  Community  industry  has  managed  to  develop  important  niche 
markets in the segment of higher added value or speciality PSF, it must be underlined 
that the core business for  the Community industry remains in regular fibres for  both 
woven  and  non-woven  applications,  segments  where  imports  from  the  countries 
concerned are increasingly present and Community industry production is exposed the 
most to unfair competition.  

(261)  Speciality fibres generate high margins but are only sold in limited quantities. In order 
to  maximise  the  capacity  utilisation  and  to  cover  the  fixed  costs  of  production,  the 
Community  industry  needs  sales  of  regular  or  basic  fibres  in  big  volumes.  For  this 
reason,  the  imposition  of  duties  shall  guarantee  the  viability  of  regular  or  basic  PSF 
production, as well as the continuation of the production of higher added value PSF, 
which strongly depends on the viability of basic PSF. It is to be noted that the main 
supplier of specialities at a world level is the Community industry itself, and such high 
added  value  material  cannot  be  sourced  from  the  countries  concerned  in  the  present 
proceeding. It is considered, therefore, that the imposition of measures would be in the 
interest of the Community industry. 

3. Impact on users and importers 

(262)  As  indicated  above  in  recitals  (254)  and  (256),  the  Commission  received  15 
questionnaire  replies  from  users,  4  full  questionnaires  from  unrelated  importers 

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selected  for  the  sample  and  5  from  related  importers.  In  addition,  three  users 
associations have submitted information and allegations to the Commission requesting 
the termination of the present proceeding without the imposition of measures.  

(263)  Users of the product concerned belong to the textile sector. The PSF market is divided 
into the spinning consumption (i.e. the manufacturing of filaments for the production 
of  textiles,  after  mixing  or  not  with  other  fibres  such  as  cotton  or  wool),  the  non-
woven  consumption  (i.e.  the  manufacturing  of  sheets  and  webs  that  have  not  been 
converted into yarns and that are bonded to each other by friction, and /or cohesion, 
and/or  adhesion,  excluding  paper),  and  the  filling  consumption  (i.e.  the  stuffing  or 
padding of certain textile goods, as for example cushions or car seats). Most of the co-
operating users in this proceeding are producers of non-woven products. Said users are 
members of one of the three users associations co-operating in this proceeding, which 
represents  the  non-woven  industry  at  a  European  level10.  Further  to  information  on 
purchases reported in their responses to the questionnaires, co-operating users during 
the IP represent about 5% of total Community consumption of PSF and about 13% of 
total  imports  from  the  countries  concerned.  Users  and  importers  have  indicated  a 
number of arguments against the imposition of duties. 

(264)  First,  the  downstream  industry  has  alleged  that  the  Community  PSF  market 
substantially  depends  on  external  suppliers  of  the  product  concerned  (the  European 
producers  can  at  maximum  satisfy  about  60%  of  the  PSF  market  demand).  In  this 
context,  in  terms  of  capacity  and  market  shares  held  in  the  Community,  two  of  the 
countries  under  investigation,  i.e.  Taiwan  and  South  Korea,  are  the  most  important 
suppliers  of  PSF  worldwide.  Therefore,  the  level  of  the  anti-dumping  duties 
necessarily affects essential Community interest aspects. 

(265)  PSF users have also claimed that they operate in a highly price sensitive market and 
that even a small increase in cost cannot be passed on to the final customer due to the 
already  fierce  competition  in  the  end-product  market  (e.g.  pillows,  textiles,  etc),  in 
particular from South East Asian countries and China. These countries already sell at 
very  low  prices  and  many  European  textile  producers  were  forced  to  at  least  partly 
dislocate their production sites to third countries.  

(266)  In  addition,  a  number  of  PSF  users  have  claimed  that  certain  types  of  the  product 
concerned  (the  so-called  hollow  conjugate  products)  are  not  produced  in  the 
Community and will not be produced by the Community producers in the near future 
because  of  the  lack  of  the  necessary  technical  equipment.  These  types  of  PSF  have 
therefore  to  be  imported  (the  so-called  hollow  conjugated  products,  mainly 
manufactured in South Korea). 

(267)  Finally, the downstream industry is, as opposed to the PSF industry, labour intensive. 
As  put  forward  by  some  interested  parties,  the  number  of  employees  in  the 
downstream industry is much higher than in the capital intensive PSF industry. As an 
example,  the  European  non-woven  industry  has  a  direct  labour  force  of  16.000 
persons, compared with 1.180 persons employed by the PSF industry. As reported by 
the  non-woven  producers,  PSF  represents  on  average  40%  of  the  total  cost  of 

10 

It  is  estimated  that  Community  non-woven  consumption  of  PSF  represents  about  25%  of  total  PSF 
market consumption for the IP.  

EN 

49 

   EN 

 
                                                 
production  of  the  product  manufactured  by  them.  It  has  been  alleged  that  the 
imposition of duties could lead to a loss of jobs or to moving manufacturing facilities 
overseas.  

(268)  Regarding  the  Community  market’s  alleged  dependence  on  external  suppliers,  it  is 
considered that, whereas duties against imports from the PRC and Saudi Arabia would 
be at an average level of 27%, these countries only held 7% of the market share during 
the  IP.  On  the  other  hand,  it  is  proposed  to  repeal  the  existing  measures  on  imports 
from  Taiwan  and  to  reduce  the  duties  currently  applicable  on  imports  from  South 
Korea. It is underlined that during the IP, with the current level of measures (see above 
recital (3)), Taiwan and South Korea held 19% of the market share. On the other hand, 
as reported by one prestigious fibre market consultancy firm, major producers of PSF 
located  in  countries  not  subject  to  anti-dumping  duties  (mainly  the  USA,  Mexico, 
Turkey  and  South  Africa)  held  during  the  IP  an  excess  capacity  amounting  to 
approximately  50%  of  the  total  Community  consumption.  In  addition,  imports  from 
these  countries  already  hold  an  important  share  of  the  Community  market,  reaching 
5.3% in the IP.  

(269)  Therefore, in spite of the proposed introduction of duties against the PRC and Saudi 
Arabia,  and  taking  into  account  the  termination  of  the  measures  against  Taiwan  and 
the reduction of those applicable on South Korea, the Community users would still be 
able to rely on (or to switch to) important suppliers of the product concerned, such as 
South  Korea  or  on  other  major  providers  located  in  countries  not  subject  to  anti-
dumping duties, including Taiwan.  

(270)  Regarding PSF users alleged inability to pass on any increased costs arising from the 
imposition  of  anti-dumping  duties,  for  the  particular  case  of  the  co-operating  users 
(who  are  almost  exclusively  producers  of  non-woven  products)  sourcing  the  product 
concerned from the PRC, Saudi Arabia, South Korea, and Taiwan, bearing in mind (i) 
that  the  average  anti-dumping  duty  rate  for  the  PRC  and  Saudi  Arabia  amounts  to 
34.6%,  whereas  said  countries  held  during  the  IP  a  7.8%  of  the  market;  (ii)  that  the 
average duty rate to be imposed on imports from South Korea decreases the average 
duty rate introduced against such country through Regulation (EC) No 2852/2000 by 2 
percentage points and that the measures against Taiwan are to be terminated; (iii) that 
South Korea and Taiwan held together 19.3% of the Community market share in the 
IP  and  (iv)  that  the  importance  of  PSF  in  the  cost  of  production  of  the  finished 
products of the co-operating users (of non-woven products) has been established as, on 
average, 40% of the costs, the increase on the cost of production on the co-operating 
downstream industry as a consequence of the measures to be introduced would be in 
the region of 0.40%.  

(271)  If, as alleged by the users, they would not be able to pass on such an increase in their 
cost of production to their customers, the impact on their financial situation would not 
be significant. It is also deemed that this low impact on the financial situation of the 
downwards  industry  shall  avoid  any  negative  effect  in  the  job  force  of  such  an 
industry.  

(272)  It  has  also  been  found  that,  despite  the  existence  of  anti-dumping  and/or 
countervailing  measures  on  about  50%  of  imports  of  the  product  concerned  from  all 
third  countries,  market  consumption  in  the  non-woven  segment  of  the  market  has 
increased  during  the  period  considered.  Pursuant  to  information  supplied  by  the 

EN 

50 

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association representing the European non-woven producers, this sector has increased 
its production by about 17% for the period from 2000 to 2002.  

(273)  It has also been found that the hollow conjugate PSF can in fact also be produced by 
the Community industry which has the necessary technical know-how and machinery. 
As  already  mentioned,  this  product  is  currently  not  supplied  by  the  Community 
industry due to the strong price pressures of the dumped imports. Anyhow, the current 
measures against the Republic of Korea, namely the main supplier of hollow conjugate 
material, are, on average, reduced.  

(274)  On the basis of the above, and taking into account the level of measures adopted and 
the termination of the proceeding against Taiwan, it is concluded that this would not 
imply a deterioration, if at all, of the situation of the users and importers of the product 
concerned.  

4. Impact on suppliers of raw materials 

(275)  Two  providers  of  raw  materials  have  co-operated  in  the  present  proceeding  by 
submitting  a  response  to  the  questionnaire.  They  are  petrochemical  industries  which 
supply  the  PSF  industry  with  PTA  and  MEG.  Both  companies  have  expressly 
supported  the  imposition  of  duties.  However,  from  a  Community  interest  point  of 
view, the position of these companies in this proceeding must be put into perspective 
with the fact that their sales of raw materials to the PSF industry represent a minimal 
part  of  their  turnover  and  hence,  the  imposition  or  not  of  measures  would  not 
substantially alter their financial or commercial situation.  

5. Environmental considerations 

(276)  As indicated above, PSF can be of virgin type, made out of derivatives of petrol (MEG 
and  PTA),  of  a  regenerated  type,  made  out  of  PET  bottles  and  other  waste,  or  of  a 
combination  of  both  types,  either  derivatives  of  petrol  or  recycled  ones.  The 
Commission  has  found  that  during  the  IP,  the  Community  industry  employed  about 
60% of virgin raw materials and 40% of recycled raw materials for the production of 
PSF.  The  Community  industry  envisages  to  progressively  increase  the  amount  of 
recycled raw materials used for the production of PSF. In fact, two of the Community 
industry  companies  have  incorporated  recycling  lines  in  their  production  premises. 
Another one envisages to incorporate such a recycling line during 2004 and 2005. 

(277)  Article 6 of the Treaty Establishing the European Community (‘the Treaty’) considers 
environmental protection as a common policy or activity to achieve the objectives set 
forth in Article 2 of the Treaty, among them the sustainable development of economic 
activities.  In  this  framework,  the  European  Community  has  considered  waste 
prevention and waste management as one of its top priorities.  

(278)  In particular, the European Community has enacted legislation concerning packaging 
and packaging waste11. One of the principles underlying this legislation is the principle 
of  recycling  and  reuse:  if  packaging  waste  cannot  be  prevented,  as  many  of  the 

11 

Directive 94/62/EC of the European Parliament and of the Council of 20 December 1994 on packaging 
and  packaging  waste  as  amended  by  Directive  2004/12/EC  of  the  European  Parliament  and  of  the 
Council, of 11 February 2004. 

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51 

   EN 

 
                                                 
materials  as  possible  should  be  recovered,  preferably  by  recycling  methods.  In  this 
context,  the  European  Community  has  recently  established  that  not  later  than  31 
December 2008, a minimum recycling target of 22.5% of plastic material contained in 
packaging waste shall be attained12.  

(279)  It  has  been  found  that  Community  PSF  industry  consumed  70%  of  the  recycling  of 
PET bottles during the IP, being by a long way, the main end-user of such packaging 
waste13.  From  this  data,  it  appears  that  the  recycling  of  PET  packaging  waste  in 
Europe significantly depends on the PSF industry, as it is its most important customer.  

(280)  The Commission considers that the imposition of duties shall contribute to guarantee 
the  viability  of  an  industrial  sector  which,  as  its  main  customer,  holds  a  central 
position in the recycling of PET packaging waste. 

(281)  The  above  conclusion  is  not  modified  by  the  fact  that  the  Community  recycling 
industry also exports PET waste to the PRC, as put forward by some interested parties. 
Indeed, it has been found that the vast majority of PET packaging waste is consumed 
by Community PSF producers.  

6. Conclusion on Community interest 

(282)  Taking into account all of the above factors, it is provisionally concluded that there are 

no compelling reasons not to impose anti-dumping measures. 

H. TERMINATION OF THE PROCEEDING IN RESPECT OF TAIWAN  

(283)  In view of the findings set out above in recitals (143) and following, the anti-dumping 
measures  currently  in  force  against  Taiwan  are  not  longer  warranted.  In  accordance 
with  Article  11  in  conjunction  with  Article  9  of  the  Basic  Regulation,  where,  after 
consultation,  protective  measures  are  unnecessary  and  there  is  no  objection  raised 
within the advisory Committee, the investigation or proceeding shall be terminated.  

(284)  In  the  light  of  the  above,  the  Commission  has  concluded  that  the  continuation  of 
protective  measures  currently  in  force  against  Taiwan  is  unnecessary  and  that  the 
proceeding should be terminated.  

I. ANTI-DUMPING MEASURES 

1. Injury elimination level 

(285)  The  level  of  the  anti-dumping  measures  should  be  sufficient  to  eliminate  the  injury 
caused  to  the  Community  industry  by  the  dumped  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  and  obtain  an  overall  profit  before  tax  that 
could  be  reasonably  achieved  under  normal  conditions  of  competition,  i.e.  in  the 

12 

13 

See Article 6.1 of Directive 94/62/EC of the European Parliament and of the Council of 20 December 
1994  on  packaging  and  packaging  waste  as  amended  by  Directive  2004/12/EC  of  the  European 
Parliament and of the Council, of 11 February 2004. 
Other end uses are bottle-to-bottle recycling, using 11% of PET bottles collected, polyester sheet, using 
7.5% and strapping, using 7.6%. 

EN 

52 

   EN 

 
                                                 
absence of dumped imports. It is considered that in the absence of dumped imports the 
Community  industry  should  yield  a  profitability  before  taxes  of  5%,  a  level  deemed 
appropriate in the complaint lodged by the Community industry. In the absence of any 
information to the contrary, this level of profit was again considered to be appropriate. 

(286)  The necessary price increase was then determined on the basis of a comparison, at the 
same level of trade, of the weighted average import price, as established for the price 
undercutting calculations, with the non-injurious price for the like product sold by the 
Community industry in the Community market. 

(287)  The  non-injurious  price  was  obtained  by  adjusting  the  sales  price  of  the  Community 
industry to reflect the above mentioned profit margin of 5%. Any difference resulting 
from  this  comparison  was  then  expressed  as  a  percentage  of  the  total  CIF  import 
value. 

2. Definitive measures 

(288)  In the light of the foregoing, it is considered that, in accordance with Article 9(4) of 
the  Basic  Regulation,  an  anti-dumping  duty  should  be  imposed  on  imports  of  the 
product  concerned  from  the  People’s  Republic  of  China,  Saudi  Arabia,  and  the 
Republic of Korea at the level of the lesser of the injury or dumping margins found. 

(289)  On the basis of the above, the duty rates are as follows:  

Country 

Company 

Cixi Jiangnan Chemical Fiber Co.Ltd.  
Sanbei Town Industry Area, Cixi City, 
Zhejiang Province  

People’s 
Republic 
China 

of 

BASIS FOR  
AD DUTY (%) 

26.3 

Far Eastern Industries (Shanghai) Ltd.  
31-33F, Baoan Tower, N°800, Dongfang 
Road, Pudong New District, 200122, 
Shanghai 

Hangzhou  An  Shun  Pettechs  Fibre  Industry 
Co. Ltd. 
N°.37,  East  Avenue,  Fu-Yang  Town, 
Hangzhou, Zhejiang Province 

Deqing  An  Shun  Pettechs  Fibre  Industry 
Co.Ltd. 
N°.9,  Cangqian  Road,  Chengguan  Town 
Deqing County 

4.9 

18.6 

18.6 

EN 

53 

   EN 

 
 
 
 
 
 
 
 
 
 
Kunshan An Shun Pettechs Fibre Industry 
Co.Ltd 
N°.78, Huting Road, Bacheng Town, 
Kunshan, Jiangsu Province 

Jiangyin Changlong Chemical Fiber Co.Ltd  
Houxiang Industrial Zone, Changjing, 
Jiangsu 214411 

 Xiake Color Spinning Co.Ltd  
N°.39, East Street, Mazhen, Jiangyin, 
Jiangsu 214406 

All other companies 

National Polyester Fibers Factory 
P.O. Box 42185, Riyadh 11541 

Saudi Basic Industries Corporation (Sabic) 
P.O. Box 5101, Riyadh 11422 

Arabian Industrial Fibres Company (Ibn 
Rushd) P.O.Box 30701, Yanbu Al-Sinaiyah 
21447 

All other companies 

Saudi Arabia 

Republic of 
Korea 

Huvis Corporation 
151-7, Samsung-dong, Gangnam-gu, Seoul 

Saehan Industries Inc 
254-8, Kongduk-dong, Mapo-ku, Seoul 

Sung Lim Co., Ltd. 
RM 911, Dae-Young Bldg, 44-1, 
Youido-Dong, Youngdungpo-ku, Seoul 

Dongwoo Industry Co. Ltd. 
729, Geochon-Ri, Bongwha-up, Bongwha-
Kun, Kyoungsangbuk-do 

East Young Co. Ltd. 
Bongwan #202, Gumi Techno Business 
Center, 267 Gongdan-Dong, Gumi-si, 
Kyungbuk, Korea 

Estal Industrial Co. 
845 Hokye-dong, Yangsan-City, Kyungnam 

18.6 

24.6 

80.2 

80.2 

20.9 

20.9 

20.9 

20.9 

5.7 

10.6 

0 

6.0 

6.0 

6.0 

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54 

   EN 

 
 
 
 
 
Geum Poong Corporation 
62-2, Gachun-Ri, Samnam-Myon, Ulju-Ku, 
Ulsan-shi 

Keon Baek Co. Ltd. 
1188-3, Shinsang-Ri, Jinryang-Eup, 
Kyungsan-si, Kyungbuk-do 

Samheung Co. Ltd. 
557-12, Dongkyu-Ri, Pochon-Eub Pochon-
Kun, Kyungki-do 

6.0 

6.0 

6.0 

All other companies 

10.6 

(290)  The  individual  company  anti-dumping  duty  rates  specified  in  this  Regulation  were 
established on the basis of findings of the present investigation. It therefore reflects the 
situation  found  during  that  investigation  with  respect  to  said  companies.  These  duty 
rates  (as  opposed  to  the  country-wide  duty  applicable  to  “all  other  companies”)  are 
thus  applicable  exclusively  to  imports  of  the  product  originating  in  the  countries 
concerned  and  produced  by  the  corresponding  companies  and  thus  by  the  specific 
legal  entities  mentioned.  Imported  products  produced  by  any  other  company  not 
specifically  mentioned  in  the  operative  part  of  this  Regulation  with  its  name  and 
address,  including  entities  related  to  the  one  specifically  mentioned,  cannot  benefit 
from this rate and shall be subject to the duty rate applicable to “all other companies”.  

(291)  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 Commission14 forthwith 
with  all  relevant  information,  in  particular  any  modification  in  the  company’s 
activities linked to production, domestic and export sales associated with, for example, 
that name change or that change in the production and sales entities. If appropriate, the 
Commission  will,  after  consultation  of  the  Advisory  Committee,  propose  the 
amendment of the Regulation accordingly by updating the list of companies benefiting 
from individual duty rates. 

3. Undertakings 

(292)  One  cooperating  exporting  producer  in  Saudi  Arabia  offered  a  price  undertaking  in 
accordance with Article 8(1) of the Basic Regulation. The minimum prices originally 
offered by this exporting producer did, however, not eliminate the injurious effect of 
dumping.  The  same  is  true  for  a  revised  offer  received  from  that  company. 
Furthermore,  the  sales  structure  of  this  company  in  the  Community  is  such  that  it 

14 

European Commission 
Directorate-General Trade 
J-79 05/16 
Rue de la Loi/Wetstraat 200 
B-1049 Brussels 

EN 

55 

   EN 

 
 
 
 
                                                 
would not allow an effective monitoring of the undertaking. The offer had therefore to 
be rejected.  

(293)  Two Chinese exporting producers offered an undertaking, which was supported by a 
users’  association.  However,  this  offer  could  not  be  accepted  because  it  would  have 
meant exempting a certain volume of imports from definitive measures and would not, 
therefore, have been adequate to remove the injury caused to the Community industry. 
Alternatively, these exporters also offered a minimum price applicable to all imports 
into  the  Community  but  at  a  level  which  did  not  eliminate  the  injurious  effect  of 
dumping.  The  offers  had  therefore  to  be  rejected.  Furthermore,  it  could  not  be 
accepted  that  different  minimum  prices  would  be  established  for  different  product 
types  which  are  not  easily  distinguishable  upon  importation.  This  would  render  the 
commitment  to  respect  the  minimum  prices  easily  to  circumvent.  In  addition,  the 
investigation  revealed  that  the  exporters’  accounting  was  not  kept  in  line  with 
international accounting standards, which would render monitoring of an undertaking 
particularly difficult. 

(294)  Another  Chinese  exporting  producer,  which  was  granted  neither  MES  nor  IT, 
proposed  an  undertaking  whereby  its  export  prices  to  the  Community  would  be 
increased.  Beside  the  fact  that  the  increase  in  price  offered  did  not  eliminate  the 
injurious  dumping  established,  it  is  the  Commission’s  practice  not  to  accept 
undertakings  from  companies  which  were  neither  granted  MES  nor  IT  since  no 
individual determination of dumping can be established in such a case. On this basis, 
the undertaking offer from this exporting producer had to be rejected.  

HAS ADOPTED THIS REGULATION: 

Article 1 

1. 

2. 

A  definitive  anti-dumping  duty  is  hereby  imposed  on  imports  of  synthetic  staple 
fibres of polyesters, not carded, combed or otherwise processed for spinning, falling 
within CN code 5503 20 00, originating in the People’s Republic of China and Saudi 
Arabia. 

The rate of duty applicable to the net free-at-Community-frontier price, before duty, 
for products produced by the following manufacturers shall be as follows: 

EN 

56 

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Rate of 
duty 
(%) 

Taric 
additional 
code 

26.3 

A590 

4.9 

A591 

Country 

Manufacturer 

Cixi  Jiangnan  Chemical  Fiber  Co.Ltd. 
Sanbei  Town  Industry  Area,  Cixi  City, 
Zhejiang Province 

People’s 
Republic  of 
China 

Industries 

Far  Eastern 
(Shanghai)  Ltd. 
31-33F,  Baoan  Tower,  N°800,  Dongfang 
Road,  Pudong  New  District,  200122, 
Shanghai 

Hangzhou  An  Shun  Pettechs  Fibre  Industry 
Co. Ltd. 
N°.37,  East  Avenue,  Fu-Yang  Town, 
Hangzhou, Zhejiang Province 

Deqing  An  Shun  Pettechs  Fibre  Industry 
Co.Ltd. 
N°.9,  Cangqian  Road,  Chengguan  Town 
Deqing County 

Kunshan  An  Shun  Pettechs  Fibre  Industry 
Co.Ltd 
N°.78,  Huting  Road,  Bacheng  Town, 
Kunshan, Jiangsu Province 

18.6 

A592 

Jiangyin  Changlong  Chemical  Fiber  Co.Ltd 
Industrial  Zone,  Changjing, 
Houxiang 
Jiangsu 214411 

24.6 

A595 

All other companies 

80.2 

A999 

EN 

57 

   EN 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
National 
P.O. Box 42185, Riyadh 11541 

Polyester 

Fibers 

Factory

20.9 

A597 

Saudi 
Arabia 

Saudi  Basic  Industries  Corporation  (Sabic)
P.O. Box 5101, Riyadh 11422 

20.9 

A598 

Arabian  Industrial  Fibres  Company  (Ibn 
Rushd)  P.O.Box  30701,  Yanbu  Al-Sinaiyah 
21447 

All other companies 

20.9 

A999 

3. 

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

Article 2 

The part of the table in Article 1(2) of Council Regulation (EC) No 2852/2000 concerning the 
definitive  anti-dumping  duty  rates  applicable  on  imports  of  synthetic  staple  fibres  of 
polyesters, not carded, combed or otherwise processed for spinning, falling within CN code 
5503 20 00 originating in the Republic of Korea, is replaced by the following:  

EN 

58 

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Republic of 
Korea 

Manufacturer 

Huvis Corporation 
151-7, Samsung-dong, Gangnam-gu, Seoul 

Rate of 
duty 
(%) 

Taric 
additional 
code 

5.7 

A151 

Saehan Industries Inc 
254-8, Kongduk-dong, Mapo-ku, Seoul 

10.6 

A599 

Sung Lim Co., Ltd. 
RM 911, Dae-Young Bldg, 44-1; Youido-
Dong, Youngdungpo-ku; Seoul 

Dongwoo Industry Co. Ltd. 
729, Geochon-Ri, Bongwha-up, Bongwha-
Kun, Kyoungsangbuk-do 

East Young Co. Ltd. 
Bongwan #202, Gumi Techno Business 
Center, 267 Gongdan-Dong, Gumi-si, 
Kyungbuk 

0 

A154 

6.0 

A608 

6.0 

A609 

Estal Industrial Co. 
845 Hokye-dong, Yangsan-City, Kyungnam 

6.0 

A610 

Geum Poong Corporation 
62-2, Gachun-Ri, Samnam-Myon, Ulju-Ku, 
Ulsan-shi 

6.0 

A611 

Keon Baek Co. Ltd. 
1188-3, Shinsang-Ri, Jinryang-Eup, 
Kyungsan-si, Kyungbuk-do 

6.0 

A612 

Samheung Co. Ltd. 
557-12, Dongkyu-Ri, Pochon-Eub Pochon-
Kun, Kyungki-do 

6.0 

A613 

All other companies 

10.6 

A999 

The anti-dumping proceeding concerning imports of synthetic fibres of polyesters originating 
in Taiwan is hereby terminated. 

Article 3 

EN 

59 

   EN 

 
 
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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