Commission Regulation (EC) No 426/2005 of 15 March 2005 on imposing a provisional anti-dumping duty on imports of certain finished polyester filament apparel fabrics originating in the People’s Republic of China
Date: 2005-03-15
Institutions: European Commission
Subjects: China, anti-dumping duty, anti-dumping legislation, originating product, textile product

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COMMISSION REGULATION (EC) No 426/2005

of 15 March 2005

on imposing a provisional anti-dumping duty on imports of certain finished polyester filament
apparel fabrics originating in the People’s Republic of China

THE COMMISSION OF THE EUROPEAN COMMUNITIES,

Having regard to the Treaty establishing the European Community,

Having regard to Council Regulation (EC) No 384/96 of 22 December 1995 on protection against dumped
imports from countries not members of the European Community (1) (the basic Regulation) and in particular
Article 7 thereof,

After consulting the Advisory Committee,

Whereas:

A. PROCEDURE

1. Initiation

(1)

(2)

(3)

(4)

(5)

On 17 June 2004, the Commission announced, by a notice published in the Official Journal of the
European Union (2), the initiation of an anti-dumping proceeding with regard to imports into the
Community of certain finished polyester filament apparel fabrics (‘FPFAF’) originating in the People's
Republic of China (‘PRC’ or ‘country concerned’).

The proceeding was initiated as a result of a complaint lodged by AIUFFASS (‘the complainant’), an
affiliate of Euratex, on behalf of 7 individual producers representing a major proportion of the
production of the product concerned in the EU, i.e. in this case 26 % of the Community production.
The complaint contained evidence of dumping of the said product and of material injury resulting
there from, which was considered sufficient to justify the initiation of a proceeding.

2. Parties concerned by the proceeding

The Commission officially advised the complainant, the exporting producers, importers, suppliers and
users as well as user associations known to be concerned, and the representatives of the PRC, of the
initiation of the proceeding. Interested parties were given an opportunity to make their views known
in writing and to request a hearing within the time limit set in the notice of initiation.

The complainant producers, other co-operating Community producers, exporting producers,
importers, suppliers, users and their respective associations made their views known. All interested
parties, who so requested and showed that there were particular reasons why they should be heard,
were granted a hearing.

The Commission sent questionnaires to all parties known to be concerned and to all the other
companies that made themselves known within the deadlines set out in the notice of initiation.
Replies were received from six of the seven Community producers included in the complaint (one
company being unable to fully cooperate due to bankruptcy), one other Community producer, one
supplier, one unrelated importer and nine unrelated users in the Community.

(1) OJ L 56, 6.3.1996, p. 1. Regulation as last amended by Regulation (EC) No 461/2004 (OJ L 77, 13.3.2004, p. 12).
(2) OJ C 160, 17.6.2004, p. 5.

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(6)

(7)

In order to allow exporting producers in the PRC to submit a claim for market economy treatment
(‘MET’) or individual treatment (‘IT’), if they so wished, the Commission also sent MET and IT claim
forms to the Chinese companies known to be concerned, and to all the other companies that made
themselves known within the deadlines set out in the notice of
In this respect, 49
the basic Regulation, and 7 companies
companies requested MET pursuant
requested only IT.

to Article 2(7) of

initiation.

In view of the apparent high number of exporting producers, importers and Community producers,
sampling was envisaged in the notice 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
to select a sample, all exporting producers,
if so,
whether sampling would be necessary and,
importers and Community producers were asked to make themselves known to the Commission
and to provide, as specified in the notice of initiation, basic information on their activities related to
the product concerned during the investigation period (1 April 2003 to 31 March 2004). After
examination of the information submitted, it was decided that sampling was only necessary with
regard to exporters. The sample selected is based on the largest representative volume of exports that
can reasonably be investigated within the time available. It consists of the 8 largest exporting Chinese
exporting producers (and their related parties), representing over 50 % of the export volume to the
Community of the co-operating parties.

(8)

The Commission sought and verified all the information deemed necessary for a provisional deter-
mination of dumping, resulting injury and Community interest. Verification visits were carried out at
the premises of the cooperating Community producers and the following companies:

(a) Community producers

— Verification visits were carried out at the premises of seven Community producers located in
four different countries. The cooperating Community producers requested in terms of Article
19 of the basic Regulation that their details are not published, as to do so would have a
significantly adverse effect upon them. The request was found to be sufficiently substantiated
and therefore granted.

(b) Exporting producers in the PRC

— Wujiang Chemical Fabric Mill Co. Ltd.

— Shaoxing Tianlong import and export Ltd.

— Wujiang Canhua Import & Export Co. Ltd.

— Fuzhou Fuhua Textile & Printing Dyeing Co. Ltd.

— Fuzhou Ta Tung Textile Works Co. Ltd.

— Hangzhou Delicacy Co. Ltd.

— Shaoxing County Huaxiang Textile Co. Ltd.

— Shaoxing Ronghao Textiles Co. Ltd. (and related company Shaoxing County Qing Fang Cheng

Textile Import and export Co Ltd).

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(c) Unrelated importers

— LE-GO — Hof (Germany)

(d) Community industry suppliers

— Elana SA — Torun (Poland)

(e) Community users

— LE-GO — Hof (Germany)

(9)

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 to establish normal value on the basis of data from an analogue
country, Turkey in this case, took place at the premises of the following company:

— Italteks Expo Grup A.A., Istanbul

(10)

The investigation of dumping and injury covered the period from 1 April 2003 to 31 March 2004
(‘IP’). The examination of trends relevant for the assessment of injury covered the period from 1
January 2000 to the end of the investigation period (‘period considered’).

3. Investigation period

(11)

(12)

4. Product concerned and like product

4.1. Product concerned
The product concerned is finished polyester filament apparel fabrics (‘FPFAF’) which is woven fabric
of synthetic filament yarn containing 85 % or more by weight of textured or non textured polyester
filaments, dyed or printed. It is normally used for apparel applications, i.e. inter alia for making lining
for clothing and for making anoraks, sports wear, ski wear, underwear and fashion items.

The product concerned is produced by weaving polyester filament yarn (which is not pre-dyed) and
then printed or dyed in order to obtain a specific design or colour. It is therefore distinguished from
unbleached or bleached woven fabric of synthetic filament yarn that is a product formed after
weaving but before dyeing, and which forms the raw material for the product concerned. It can
also be distinguished from woven polyester filament fabrics for which pre-dyed yarn is woven into
cloth, and the design is created by weaving the pattern. The latter product has different basic physical
and chemical characteristics, since the raw material used (pre-dyed yarn) is different, and the design is
obtained through weaving and not printing or dyeing. In addition, such type of finished fabric is
normally used for soft furnishing applications, whereas the product concerned is almost exclusively
used for making clothing.

(13)

The investigation has shown that all types of the product concerned as defined in recital 11, despite
differences in a variety of factors such as colour, size of the yarns and finish, 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. The product concerned falls within CN codes 5407 52 00, 5407 54 00, 5407 61 30,
5407 61 90 and ex 5407 69 90.

4.2. Like product

(14) No differences were found between the product concerned and the FPFAF produced and sold on the
domestic market in the PRC or in Turkey, which served as an analogue country for the purpose of
establishing the normal value with respect to certain imports from the PRC. Indeed, they both have
the same basic physical and chemical characteristics and uses.

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(15)

Likewise, no differences were found between the product concerned and the FPFAF produced by the
Community industry and sold on the Community market. They both also were found to share the
same physical and chemical characteristics and uses.

(16)

Therefore, these products are provisionally considered to be alike within the meaning of Article 1(4)
of the basic Regulation.

B. DUMPING

1. Market economy treatment (MET)

(17)

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

(18)

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

1. Business decisions and costs are made in response to market conditions and without State

interference;

2. Acounting records independently audited in line with international accounting standards and

applied for all purposes;

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

4. Legal certainty and stability is provided by bankruptcy and property laws;

5. Currency exchanges are carried out at the market rate.

(19)

In the present investigation, 49 exporting producers in the PRC made themselves known and
requested MET pursuant to Article 2(7)(c) of the basic Regulation. Each single MET application
was analysed. In view of the large number of companies concerned, on-spot investigations were
carried out only at the premises of eight companies (see recital (7)). For the remaining companies, a
detailed desk analysis of all information submitted was carried out, and an extensive exchange of
correspondence took place with the companies concerned, where elements in their submission were
missing or unclear. Where a subsidiary or any other company related to the applicant in the People’s
Republic of China is a producer and/or an exporter of the product concerned, the related party was
also invited to complete the MET claim form.
Indeed, MET can be granted only if all related
companies meet the criteria set above.

(20) As regards the companies for which on-spot

the investigation
revealed that three of the eight Chinese exporting producers fulfilled all the conditions for MET
(see list of companies in recital (23)). The remaining five claims had to be rejected. The criteria not
met by the five exporting producers are set out in the table below.

investigations were carried out,

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(21) As regards the remaining 41 companies, the analysis carried out individually for each company
concluded that MET should not be granted to 19 companies, since they manifestly did not meet
the criteria of Article 2(7)(c) of the basic Regulation. It was considered that 10 out of these 19
companies did not sufficiently co-operate in the investigation by not submitting the necessary
information requested. Indeed, even after a deficiency letter, those companies failed to sufficiently
demonstrate that either themselves, or any related company(ies) involved in the production/sales of
the product concerned, fulfilled the relevant MET criteria. For the other 9 out of these 19 companies,
the criteria not met are also set out in the table below. The remaining 22 companies could
successfully demonstrate that they met the five relevant MET criteria.

(22)

The following table summarises the determination for each company not granted MET, 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

Article 2(7)(c)
indent 3

Article 2(7)(c)
indent 4

Article 2(7)(c)
indent 5

Criteria

1

2

3

4

5

6

7

8

9

10

11

12

13

14

Not MET

Not MET

MET

MET

MET

Not MET

Not MET

Not MET

Not MET

Not MET

Not MET

Not MET

Not MET

Not MET

Not MET

MET

MET

MET

MET

MET

MET

Not MET

Not MET

Not MET

MET

MET

MET

MET

Not MET

MET

MET

Not MET

Not MET

Not MET

MET

MET

MET

Not MET

Not MET

Not MET

Not MET

MET

MET

MET

MET

MET

MET

MET

MET

MET

MET

MET

MET

MET

MET

MET

Source: verified questionnaire replies of cooperating Chinese exporters.

MET

MET

MET

MET

MET

MET

MET

MET

MET

MET

MET

MET

MET

MET

(23) On this basis, the exporting producers in the PRC which obtained MET are the following:

1.

2.

Fuzhou Fuhua Textile & Printing Dyeing Co. Ltd.

Fuzhou Ta Tung Textile Works Co. Ltd.

3. Hangzhou Delicacy Co. Ltd.

4.

Far Eastern Industries (Shangai) Ltd.

5. Hangzhou Hongfeng Textile Co. Ltd.

6. Hangzhou Jieenda Textile Co. Ltd.

7. Hangzhou Mingyuan Textile Co. Ltd.

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8. Hangzhou Shenda Textile Co. Ltd.

9. Hangzhou Yililong Textile Co. Ltd.

10. Hangzhou Yongsheng Textile Co. Ltd.

11. Hangzhou ZhenYa Textile Co. Ltd.

12. Huzhou Styly Jingcheng Textile Co. Ltd.

13. Nantong Teijin Co. Ltd.

14. Shaoxing Ancheng Cloth industrial Co. Ltd.

15. Shaoxing County Jiade Weaving and Dyeing Co. Ltd.

16. Shaoxing County Pengyue Textile Co. Ltd.

17. Shaoxing County Xingxin Textile Co. Ltd.

18. Shaoxing Yinuo Printing Dyeing Co. Ltd.

19. Wujiang Longsheng Textile Co. Ltd.

20. Wujiang Xiangshen Textile Dyeing Finishing Co. Ltd.

21. Zheijang Tianyuan Textile printing and Dying Co. Ltd.

22. Zhejiang Shaoxing Yongli Printing and Dyeing Co. Ltd.

23. Zhejiang Xiangsheng Group Co. Ltd.

24. Zhejiang Yonglong enterprises Co. Ltd.

25. Zhuji Bolan Textile Industrial development Co. Ltd.

2. Individual treatment (IT)

(24)

Further to article 2(7)(a), a country-wide duty, if any, is established for countries falling under Article
2(7), except in those cases where companies are able to demonstrate that they meet all criteria set out
in Article 9(5) of the basic Regulation for receiving individual treatment.

(25)

The exporting producers which requested MET, also claimed individual treatment in the event of not
being granted MET. Seven additional exporting producers requested only individual treatment.

(26)

Firstly, as regards the companies that claimed but failed to obtain MET,
it was found that 13
companies met all the requirements for IT set forth in Article 9(5) of the basic Regulation. As far
as the other companies are concerned, ten of them did not sufficiently co-operate in order to be
granted MET, and their level of cooperation was so low that they did not even submit enough
evidence to justify their request for IT. One other company could not be granted IT because it could
not properly and sufficiently demonstrate that its export prices and quantities, and conditions and
terms of sale are freely determined. Indeed, for the majority of the export sales it was not possible to
verify the final customer or payment of the goods, and the company could not clarify the strong
doubts that, under those circumstances, the State was involved in the price setting of the company.

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(27)

Secondly, from the seven companies that only requested IT, five were found to meet the requirements
set forth in Article 9(5) of the basic Regulation. The other two companies could not sufficiently
demonstrate that their export prices and quantities as well as the conditions and terms of the sales
were freely determined, and without any State interference. Indeed, both companies did not provide
the necessary requested information, namely their Articles of Association in force during the whole
IP, and one of them was also found to be State owned during the major part of the IP.

(28)

It was therefore concluded that IT should be granted to the following 18 companies:

1. Hangzhou CaiHong Textile Co. Ltd.

2. Hangzhou Fuen Textile Co. Ltd.

3. Hangzhou Jinsheng Textile Co. Ltd.

4. Hangzhou Xiaonshan Phoenix Industry Co. Ltd.

5. Hangzhou Zhengda Textile Co. Ltd.

6. Wujiang Canhua Import & Export Co. Ltd.

7.

Shaoxing China Light & Textile Industrial City Somet Textile Co. Ltd.

8.

Shaoxing County Fengyi Textile Printing and Dying Co. Ltd.

9.

Shaoxing County Huaxiang Textile Co. Ltd.

10. Shaoxing Nanchi Textile Printing Dyeing Co. Ltd.

11. Shaoxing Ronghao Textiles Co. Ltd (and related company Shaoxing County Qing Fang Cheng

Textile import and export Co. Ltd.)

12. Shaoxing Xinghui Textiles Co. Ltd.

13. Shaoxing Yongda Textile Co. Ltd.

14. Shaoxing Tianlong import and export Ltd.

15. Zhejiang Huagang Dyeing and Weaving Co. Ltd.

16. Zheijang Golden time printing and Dying knitwear Co. Ltd.

17. Zheijang Golden tree SLK printing Dying and Sandwshing Co. Ltd.

18. Zheijang Shaoxiao Printing and Dying Co. Ltd.

(29)

It is recalled that in view of the large number of companies involved, it was decided to make use of
the provisions for sampling, and that for this purpose, a sample of eight companies, with the largest
export volumes to the EU was chosen, in agreement with the Chinese authorities.

3. Sampling

(30)

In this respect, the analysis subsequently revealed that from the eight companies originally selected,
MET could be granted to three companies, and IT to four of
the companies concerned. The
provisions on sampling have therefore been applied on that basis.

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4.1. Determination of normal value for exporting producers granted MET

4. Normal value

(31) As far as the determination of normal value is concerned, the Commission first established, for each
exporting producer concerned, whether its total domestic sales of FPFAF were representative in
comparison with its total export sales to the Community. In accordance with Article 2(2) of the
basic Regulation, domestic sales were considered representative when the total domestic sales volume
of each exporting producer was at least 5 % of its total export sales volume to the Community.

(32)

For the exporting producers having overall representative domestic sales, the Commission subse-
quently identified the types of FPFAF sold domestically which were identical or directly comparable to
the types sold for export to the Community.

(33)

For each of those types, 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 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 exported to the
Community.

(34) An examination was also made as to whether the domestic sales of each type of the product
concerned could be regarded as having been made in the ordinary course of trade, by establishing
the proportion of profitable sales to independent customers of the type in question.

(35)

In cases where the sales volume of a type of FPFAF, sold at a net sales price equal to or above its 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 its cost of production, normal value was
based on the actual domestic price. This price was 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.

(36) Where the volume of profitable sales of a type of FPFAF represented 80 % or less of the total sales
volume of that type, or where the weighted average price of that type was below its cost of
production, normal value was based on the actual domestic price, which was 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.

(37)

Finally, where the volume of profitable sales of any type of FPFAF 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.

(38) Wherever domestic prices of a particular type sold by an exporting producer could not be used,
constructed normal value was used in preference to domestic prices of other exporting producers.
Due to the number of different types and the variety of factors (such as the type of the fibres, the size
of the yarns, the finishing of the fabrics) affecting them, using domestic prices of other exporting
producers would have meant in this case making numerous adjustments, most of which would have
had to be based on estimates. It was therefore considered that the construction of the normal value
for each exporting producer formed a more appropriate method.

(39)

Consequently, in accordance with Article 2(3) of the basic Regulation, normal value was constructed
by adding to each exporter’s manufacturing costs of the exported types, adjusted where necessary, a
reasonable amount for selling, general and administrative expenses (‘SG&A’) and a reasonable margin
of profit. To this end, 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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(40) Actual domestic SG&A expenses were considered reliable when the total domestic sales volume of
the company concerned could be regarded as representative as compared to the volume of export
sales to the Community. The domestic profit margin was determined on the basis of domestic sales
of those types that were sold in the ordinary course of trade. For this purpose, the methodology set
out in recital (34) was applied. Where these criteria were not met, a weighted average SG&A expenses
and/or profit margin of the other companies with representative sales in the ordinary course of trade
in the country concerned was used.

(41)

Two companies had overall representative sales but it was found that only certain types of the
product concerned, which were exported, were sold on the domestic market or were sold on the
domestic market in the ordinary course of trade. For the remaining types of FPFAF exported by this
company normal value had to be constructed following the methodology explained in the recital (38)
to (40).

(42) One company was found not to have overall representative domestic sales of FPFAF, and normal
value therefore had to be constructed following the methodology explained in the recital (38) to (40).

(43)

It should be noted that in the case of two companies, the verification revealed that the manufacturing
costs reported by the companies did not properly include all the relevant costs elements, and
adjustments have therefore been made accordingly.

4.2. Determination of normal value for all exporting producers not granted MET

(a) A n a l o g u e c o u n t r y

(44) According to Article 2(7) of the basic Regulation, normal value for companies to which MET could
not be granted, was established on the basis of the prices or constructed value in an analogue
country.

(45)

In the Notice of Initiation, the Commission indicated its intention to use Mexico as an appropriate
analogue country for the purpose of establishing normal value for the PRC and interested parties
were invited to comment on this.

(46) A number of exporting producers in the PRC not granted MET objected to this proposal. The main
arguments were that Mexico was not considered an appropriate analogue country because of its
limited production volume and limited number of producers as compared to China. Questionnaires
were sent to all known exporting producers in Mexico, but no reply was received. Mexico could
therefore not be chosen as analogue country.

(47)

The Commission services therefore considered alternative solutions and it was found that Turkey
could be considered an appropriate analogue country. Indeed, the investigation revealed that Turkey
is a competitive market for the product concerned with various domestic producers, of different sizes,
and significant imports from third countries. The domestic producers were found to produce similar
product types as in the PRC and have similar production methods. The Turkish market was therefore
deemed sufficiently representative for the purpose of establishing normal value.

(48) All known exporting producers in Turkey were contacted, and one company accepted to co-operate.
A questionnaire was therefore sent to this producer and the data submitted in its reply was verified
on the spot.

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(b) D e t e r m i n a t i o n o f n o r m a l v a l u e

(49)

Pursuant to Article 2(7)(a) 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 prices paid or payable on the domestic market of Turkey, for
product types which were found to be made in the ordinary course of trade, in accordance with the
methodology set out in recital (35). Where necessary, those prices were adjusted so as to ensure a fair
comparison with those product
types exported to the Community by the Chinese producers
concerned.

(50) As a result, normal value was established as the weighted average domestic sales price to unrelated

customers by the co-operating producer in Turkey.

(51)

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

5. Export price

(52)

In the case of the companies granted IT, the product concerned was directly exported to unrelated
customers in the Community, and therefore the export price was calculated in accordance to the
methodology set out in recital (51) above.

6. Comparison

(53)

The normal value and export prices 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
the basic Regulation. Appropriate adjustments concerning transport and
with Article 2(10) of
insurance, credit, commission and bank charges were granted in all cases where they were found
to be reasonable, accurate and supported by verified evidence. Adjustments were also made where the
export sales were made via a related company located in a country other than the country concerned
or the Community, pursuant to Art 2(10) (i) of the basic Regulation.

(54)

It was found that a lower level of VAT is reimbursed on export sales than that which is reimbursed
for domestic sales. To take account of this difference, export prices were adjusted on the basis of the
difference in the reimbursed VAT levels between export and domestic sales, i.e. 2 % in 2003 and 4 %
in 2004.

7.1. For the co-operating exporting producers granted MET/IT

7. Dumping margin

a) M E T

(55)

For the three companies which were granted MET following the on-spot verification, and which were
included in the sample, the weighted average normal value of each type of the product concerned
exported to the Community was compared with the weighted average export price of the corre-
sponding type of the product concerned, as provided for under Article 2(11) of the basic Regulation.
These three companies being related, the provisional dumping margin expressed as a percentage of
the CIF import price at the Community border has been calculated as the weighted average of the
in line with the Community’s policy for
dumping margins of the three co-operating producers,
related exporting producers.

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(56)

(57)

The remaining 22 companies which were granted MET, but were not selected in the sample, were
attributed a provisional dumping margin at the level of the weighted average margin of dumping
margin provisionally established for the parties in the sample which were granted MET.

b) I T

For the four sampled companies granted IT, the weighted average normal value established for the
analogue country was compared with the weighted average export price to the Community, as
provided for under Article 2(11) of
the remaining 18
companies that were granted IT, but not included in the sample, the provisional dumping margin
is set at the level of the weighted average margin of dumping provisionally established for the parties
in the sample that were granted IT.

the basic Regulation.

In the case of

(58) On this basis, the provisional weighted average dumping margins expressed as a percentage of the

CIF Community frontier price duty unpaid are:

Company

Provisional dumping margin

Fuzhou Fuhua Textile & Printing Dyeing Co. Ltd.

Fuzhou Ta Tung Textile Works Co. Ltd.

Hangzhou Delicacy Co. Ltd.

Far Eastern Industries (Shangai) Ltd.

Hangzhou Hongfeng Textile Co. Ltd.

Hangzhou Jieenda Textile Co. Ltd.

Hangzhou Mingyuan Textile Co. Ltd.

Hangzhou Shenda Textile Co. Ltd.

Hangzhou Yililong Textile Co. Ltd.

Hangzhou Yongsheng Textile Co. Ltd.

Hangzhou ZhenYa Textile Co. Ltd.

Huzhou Styly Jingcheng Textile Co. Ltd.

Nantong Teijin Co. Ltd.

Shaoxing Ancheng Cloth industrial Co. Ltd.

Shaoxing County Jiade Weaving and Dyeing Co. Ltd.

Shaoxing County Pengyue Textile Co. Ltd.

Shaoxing County Xingxin Textile Co. Ltd.

Shaoxing Yinuo Printing Dyeing Co. Ltd.

Wujiang Longsheng Textile Co. Ltd.

Wujiang Xiangshen Textile Dyeing Finishing Co. Ltd.

Zheijang Tianyuan Textile printing and Dying Co. Ltd.

Zhejiang Shaoxing Yongli Printing and Dyeing Co. Ltd.

Zhejiang Xiangsheng Group Co. Ltd.

Zhejiang Yonglong enterprises Co. Ltd.

Zhuji Bolan Textile Industrial development Co. Ltd.

Hangzhou CaiHong Textile Co. Ltd.

20,0 %

20,0 %

20,0 %

20,0 %

20,0 %

20,0 %

20,0 %

20,0 %

20,0 %

20,0 %

20,0 %

20,0 %

20,0 %

20,0 %

20,0 %

20,0 %

20,0 %

20,0 %

20,0 %

20,0 %

20,0 %

20,0 %

20,0 %

20,0 %

20,0 %

42,3 %

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Official Journal of the European Union

L 69/17

Company

Provisional dumping margin

Hangzhou Fuen Textile Co. Ltd.

Hangzhou Jinsheng Textile Co. Ltd.

Hangzhou Xiaonshan Phoenix Industry Co. Ltd.

Hangzhou Zhengda Textile Co. Ltd.

Wujiang Canhua Import & Export Co. Ltd.

Shaoxing China Light & Textile Industrial City Somet Textile Co. Ltd.

Shaoxing County Fengyi Textile Printing and Dying Co. Ltd.

Shaoxing County Huaxiang Textile Co. Ltd.

Shaoxing Nanchi Textile Printing Dyeing Co. Ltd.

Shaoxing Ronghao Textiles Co. Ltd.

Shaoxing County Qing Fang Cheng Textile import and export Co. Ltd.

Shaoxing Xinghui Textiles Co. Ltd.

Shaoxing Yongda Textile Co. Ltd.

Shaoxing Tianlong import and export Ltd.

Zhejiang Huagang Dyeing and Weaving Co. Ltd.

Zheijang Golden time printing and Dying knitwear Co. Ltd.

Zheijang Golden tree SLK printing Dying and Sandwshing Co. Ltd.

Zheijang Shaoxiao Printing and Dying Co. Ltd.

42,3 %

42,3 %

42,3 %

42,3 %

81,9 %

42,3 %

42,3 %

26,7 %

42,3 %

36,3 %

36,3 %

42,3 %

42,3 %

70,3 %

42,3 %

42,3 %

42,3 %

42,3 %

7.2. For all other exporting producers

(59)

(60)

In order to calculate the countrywide dumping margin applicable to all other exporters in the PRC,
the Commission first established the level of co-operation. A comparison was made between the total
imports of the product concerned originating in the PRC calculated on the basis of Eurostat and the
actual questionnaire replies received from exporters in the PRC. On this basis, and considering the
high degree of
it was
established that the level of co-operation was high, i.e. 77 % of the overall Chinese exports to the
Community.

fragmentation that characterises the structure of the exporting industry,

The dumping margin was consequently calculated by using the weighted average export price
reported by a co-operating exporter to which neither MET nor IT was granted together with the
export price as obtained from Eurostat, and comparing the resulting price with the weighted average
normal value established for the analogue country for comparable product types. The use of Eurostat
as facts available pursuant to Article 18 of the basic Regulation was necessary in the absence of more
information on export prices for determining the country-wide duty.

(61) On this basis the countrywide level of dumping was provisionally established at 109,3 % of the CIF

Community frontier price.

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(62) During the investigation period, the like product was manufactured by

C. INJURY

1. Community production

— seven complainant Community producers and one other fully supporting producer, accounting
for an output of 97 m running metres, seven of which fully co-operated with the Commission
during the investigation and one of which was only able to partially cooperate due to insolvency,

— twelve other producers with production of around 59 m running meters which supported the

proceedings and provided some general information concerning production and sales,

— other Community producers which were not complainants and did not co-operate, but did not

oppose the present proceeding.

(63)

The output of all the above companies constitutes the total Community production of FPFAF and is
estimated at around 330 m running metres.

2. Definition of the Community industry

(64)

The accumulated production of the 7 Community producers that fully co-operated in the investi-
gation was 97 m running metres during the investigation period, or around 30 % of the estimated
total production of FPFAF in the Community. Thus the 7 Community producers that fully co-
operated have been provisionally considered to constitute the Community industry within the
meaning of Articles 4(1) and 5(4) of the basic Regulation.

(65) Apparent consumption of FPFAF in the Community was established on the basis of:

3. Community consumption

— the total

imports of FPFAF into the Community as reported by Eurostat together with data

submitted by exporting producers,

— the total verified sales of the Community industry on the Community market, as reported in the

verified questionnaire responses of the 7 co-operating Community producers, and

— the sales data of the 12 other Community producers who provided some general information,

— the sales data of all the other Community producers, estimated on the basis of production data.

(66)

Community consumption of FPFAF was relatively stable during the period considered. Having peaked
at 754 m running metres in 2001, Community consumption of FPFAF reached 732,34 m running
metres during the IP, which is 0,92 % lower than the level of consumption at the beginning of the
period considered. The slight fall in FPFAF consumption has been triggered by increasing imports of
finished apparel as production of apparel has increasingly moved outside the Community. This has
led to a stabilisation in the level of apparel production in the Community, despite increasing
consumption of finished apparel.

2000

2001

2002

2003

IP

EU Consumption

739 169 985

754 214 336

747 754 113

735 991 749

732 342 190

2000 = 100

100

102

101

100

99

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4. Imports into the Community from the country concerned

4.1. Volume and market share of the imports concerned

(67)

The evolution of imports from the PRC, in volume and market share, has been the following

2000

2001

2002

2003

IP

PRC

134 554 007

185 488 587

221 465 186

268 129 534

287 748 753

2000 = 100

Market Share (%)

100

18,2

138

24,6

165

29,6

199

36,4

214

39,3

(68) Over the period considered, the imports from the PRC have constantly increased from 134 m
running metres in the year 2000 to 287 m running metres in the IP, i.e. by 114 %. Their market
share of the Community consumption went from 18,2 % in 2000 to 36,4 % in 2002 to reach 39,3 %
during the investigation period.

4.2. Prices of imports and undercutting

2000

2001

2002

2003

PRC EUR/rm

1,41

2000 = 100

100

1,44

102

1,33

94

1,15

82

IP

1,08

77

(69) Average prices of Cif imports from Prc increased slightly between 2000 and 2001 and decreased by
8 percentage points in 2002. The decrease accelerated in 2003 (12 points) and continued in the
investigation period. For the whole period a decrease of 23 percentage points was achieved.

(70)

For the purpose of analysing price undercutting, the prices of FPFAF sold by the Community industry
were compared to those of the imports from the PRC into the Community during the IP, on the basis
of weighted average prices per product type. This comparison was made after deduction of rebates
and discounts. The prices of the Community industry were adjusted to ex-works prices, and the
prices of the imports were CIF Community frontier, plus duties, with adjustments made for the level
of trade and handling costs, based on information collected during the investigation, notably from
co-operating unrelated importers.

(71)

The comparison showed that during the IP FPFAF originating in the PRC was sold in the Community
at prices which undercut the Community industry’s prices, when expressed as a percentage of the
latter, by a range from 8,8 % to 51,1 %. Moreover, there was also price depression as the price
obtained by the Community industry did not cover their production costs.

5. Situation of the Community industry

(72)

In accordance with Article 3(5) of the Basic Regulation, the examination of the impact of the dumped
imports on the Community industry included an evaluation of all economic factors and indices
having a bearing on the state of the industry from 2000 (base year) to the IP.

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(73)

The Community industry data below represent the aggregated information of the 7 co-operating
Community producers.

5.1. Production, production capacity and capacity utilisation

(74)

The production capacity was established on the basis of the theoretical maximum hourly output of
the machines installed, multiplied by the annual theoretical working hours, considering maintenance
and other similar production interruptions.

2000

2001

2002

2003

IP

121 863 189

116 251 098

106 323 467

97 293 397

96 478 634

100

95

87

80

79

189 100 207

192 687 309

178 904 418

172 766 620

171 653 883

100

64 %

100

102

60 %

94

95

59 %

92

91

56 %

88

91

56 %

88

Production
(running metres)

Index
(2000 = 100)

Production
capacity

Index
(2000 = 100)

Capacity utili-
sation

Index
(2000 = 100)

(75) As shown in the table above, production during the period considered decreased by 21 %, despite
fairly stable Community consumption (a fall of 1 % overall). During the same period production
capacity decreased by 9 %. In spite of the decreasing production capacity, the capacity utilisation
shows an even more decreasing trend during the period considered, with the capacity utilisation rate
in the IP at 56 %, eight percentage points below the level at the beginning of the period.

5.2. Stocks

(76)

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

Stocks
(running metres)

as % of
production

2000

2001

2002

2003

IP

16 580 068

15 649 118

16 398 108

14 491 370

15 283 152

13,6

13,5

15,4

14,9

15,8

(77)

The level of stocks in absolute figures showed some fluctuations but overall decreased between 2000
and the IP. However, as a percentage of production, stocks actually increased from 13,6 % in 2000 to
14,9 % in 2003 and 15,8 % in the IP. This reflects the increasing levels of stock held by the
Community industry relative to their levels of production.

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5.3. Sales volume, market shares and prices in the EC

(78)

The figures below represent
Community.

the Community industry’s sales to independent customers in the

Sales volume
(running metres)

Index
(2000 = 100)

Market Share

Index
(2000 = 100)

Average unit
prices
(EUR/running
metre)

Index
(2000 = 100)

2000

2001

2002

2003

IP

90 860 385

79 328 799

76 225 554

73 913 243

71 771 114

100

87

84

81

12,3 %

100

10,5 %

85

10,2 %

83

10,0 %

81

1,29

1,38

1,36

1,40

79

9,8 %

80

1,38

100

107

105

109

107

(79)

The Community industry’s sales volumes have been steadily decreasing. They decreased by 21 %
during the period considered. The decrease in sales volumes should be seen in the light of the
increased imports from China during the same period, which increased by 114 %.

(80)

Between 2000 and 2001, the market shares of the Community industry decreased from 12,3 % to
10,5 %, notwithstanding a 2 % increase in Community consumption. The market share of
the
Community industry continued to decrease between 2001 and the IP, when it fell back to 9,8 %.

(81)

The Community industry’s average sale prices increased by 7 % between 2000 and 2001, and have
since remained relatively stable fluctuating between EUR 1,36 and EUR 1,40. The price increase
between 2000 and 2001 resulted from a change in the product mix as the Community industry
increasingly focussed on higher specification, more technologically advanced, products which have
higher cost but also higher added value. Nevertheless, that increase was less than could have been
expected given the increase in quality and specification, and resultant increase in costs. Thereafter, the
Community industry continued to upgrade its product mix with a further shift to more advanced and
higher added value products which carry a price premium. However, the Community industry was
unable to charge higher prices despite the higher quality and specification of the goods sold. During
the IP, prices fell back to their level in 2001.

5.4. Growth

(82) During the whole period growth was negative in term of production, sales volume and market share.

This resulted in negative financial results.

(83)

5.5. Profitability, return on investment and cash flow
The profit concept used below is profit before taxes, which for ‘Profitability on EC Sales’ represents
the profit generated by sales of FPFAF on the Community market, but in the case of ‘Return on
Investment’ and ‘Cash Flow’
it represents the profit generated at the company level, being the
narrowest group of products which includes the like product, for which the necessary information
can be provided pursuant to Article 3(8) of the basic Regulation.

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(84)

The return on investment has been calculated on the basis of return on net assets, as return on net
assets is considered more relevant for the analysis of a trend.

Profitability on
EC Sales

Return on
Investment

2000

1,2 %

2001

1,1 %

2002

– 2,7 %

2003

– 4,0 %

IP

– 3,9 %

– 5,6 %

– 9,2 %

– 10,7 %

– 25,7 %

– 24,2 %

Cash Flow

13 701 583

13 442 402

12 186 295

12 438 496

12 922 951

(85) As noted above, the Community industry’s average unit price increased by 7 % overall in the period
considered due to a change in the product mix. However, profitability of EC sales fell from 1,2 % in
2000 to – 4 % in 2003 and – 3,9 % in the IP. This reflects the fact that, notwithstanding the steps
taken by the Community industry to move away from basic products towards more sophisticated
products in order to remain profitable, the Community industry actually became loss-making.

(86)

The return on investment shows the same overall trend as profitability. It decreased from – 5,6 % to
– 24,2 % over the period considered. It should be noted that this ratio refers to the whole activity of
these companies, as it was not possible to allocate investments to the product concerned.

(87)

Cash flow decreased by 11 % between 2000 and 2002, before increasing by 6 % between 2002 and
the IP. Over the period considered cash flow decreased by 6 %.

5.6. Investments and ability to raise capital

2000

2001

2002

2003

IP

Investments

7 072 559

12 470 883

4 591 730

7 164 078

7 081 586

(88)

Levels of investment increased by 76 % in 2001, but then fell by 63 % in 2002 before returning to
their previous level (around EUR 7,1 m) in 2003 and the IP. The large increase in 2001 and fall in
2002 was due to the date at which investments were recorded rather than a change in investment
strategy in these years.

(89) Despite the difficulties which it has encountered, the Community industry has continued to make
new investments. However, these have not been directed at increasing capacity but rather to ensuring
that it has fully up-to-date machinery which can produce a product of a consistently high quality
whilst reducing costs through more efficient use of energy, water and other resources and with a
greater level of automation.

(90)

There is an approximately two-year time lap between the decision to invest in larger scale projects
and the moment when that investment is realised and ready to be used. This partly explains why the
level of investments has been maintained in the period considered despite worsening financial results.

(91) Much of the Community industry is made up of small or medium sized enterprises. In consequence,
the Community industry’s ability to raise capital was reduced to some extent during the period
considered, especially in the latter part thereof, when profitability became negative.

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5.7. Employment, productivity and wages

Number of employees

Index 1999 = 100

Employment costs
(T.EUR)

Index 1999 = 100

Productivity
(Kilometres/employee)

Index 1999 = 100

2000

2001

2002

2003

928

100

894

96

866

93

840

91

IP

790

85

35 285

35 209

34 391

33 010

32 228

100

131

100

100

130

99

97

123

94

94

120

92

91

122

93

(92) As seen above,

the Community industry reduced its production by 21 % during the period
considered. As a result of this reduction and also due to investment in automated systems it was
also forced to reduce its workforce. The number of employees fell steadily from 928 in 2000 to 790
in the IP, a decrease of 15 %. At the same time,
in consequence of the reduction in employees,
employment costs fell from EUR 35,3 m in 2000 to EUR 32,2 m in the IP, a reduction of 9 %.

(93) Notwithstanding this reduction in the workforce and the increased automation, productivity actually
fell as, following decreasing sales volumes, the Community industry was forced to reduce production.
In consequence, the benefit of investment in new machinery was to some extent not realised.

5.8. Magnitude of actual margin of dumping

(94) Given the volume and price of the dumped imports, the impact of the actual margins of dumping

cannot be considered negligible.

5.9. Recovery from past dumping

(95)

The Community industry was not in a situation where it had to recover from the past effects of
injurious dumping.

6. Conclusion on injury

(96)

Practically all economic indicators follow an overall negative trend in the period considered.
Production volume has fallen by 21 %, production capacity by 9 % and capacity utilisation by
12,5 %. Whilst stocks have fallen in absolute terms,
they have increased as a percentage of
production. EC sales volumes have fallen by 20 % and market share by 21 %. Although prices
increased by 7 % overall, this was not sufficient to reflect the change in the product mix as the
Community industry has increasingly moved to more sophisticated products, and the increased costs
resulting therefrom. The difficult situation in which the Community industry found itself, was
reflected in a decrease of profitability from 1,2 % in 2000 to losses of – 3,9 % in the IP. Return
on assets has also become increasingly negative, and cashflow has decreased. Employment and wages
have fallen as staff has been reduced to decrease costs in light of falling production, sales and
profitability. Productivity has also fallen as reduced production has prevented the benefits of
reduced staff numbers and continued investment in modern plant and machinery from flowing
through.

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(97) Whilst the Community industry has managed to maintain a good level of investment to date, their
ability to raise capital is clearly affected by the growing losses incurred and they cannot expect to be
able to continue to invest at this level if their financial position does not improve.

(98)

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

D. CAUSATION

1. Preliminary remarks

(99)

In accordance with Article 3(6) 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 country
concerned. In accordance with Article 3(7) of the basic Regulation, the Commission also examined
other known factors which might have injured the Community industry in order to ensure that any
injury caused by those factors was not wrongly attributed to the dumped imports.

2. Effect of the dumped imports

(100) The volume of FPFAF originating in the PRC increased significantly during the period considered. As
can be seen in the table under recital (67), imports from the PRC increased from around 135 m
running metres in 2000 to a level of 288 m running metres in the IP, i.e. by 114 %. As a result, the
market share of imports of FPFAF from the PRC more than doubled, going from of 18,2 % to 39,3 %.

(101) As established in recital (71) above, the imports originating in the PRC undercut the average sales
price of the Community industry by a significant amount, with an undercutting margin ranging from
8,8 to 51,1 %. The price pressure by the imports concerned prevented the Community industry from
increasing their prices in order to reflect the higher added value resulting from the specifications of
the product mix sold by the Community industry.

(102) The substantial increase in the volume of imports originating in PRC and their gain in market share
between 2000 and the IP, at prices which remained well below those of the Community industry,
coincided in time with the deterioration in the situation of the Community industry during the very
same period, as shown in the trend of almost all injury indicators. The Community industry was
forced to try to match prices in an attempt to maintain market share and thus production. However,
where prices were too low to cover variable costs they were forced to give up market share in order
to avoid incurring even greater losses.

(103)

It is therefore provisionally concluded that the pressure exerted by the imports concerned, which
significantly increased their volume and market share from 2000 onwards, and which were made at
low dumped prices, played a determining role in causing price depression and suppression and loss
of market share for the Community industry and, as a consequence, a deterioration in its financial
situation.

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3.1. Imports originating in other third countries

3. Effect of other factors

(104) The imports from third countries not concerned by this investigation showed the following deve-

lopment during the period considered:

All other
countries

2000 = 100

Market Share (%)

2000

2001

2002

2003

IP

263 755 593

268 396 949

270 063 373

233 948 972

227 822 323

100

35,7

102

38,4

102

36,1

89

31,8

86

31,1

(105) Following an increase in volumes in 2001 and 2002, total imports from all other countries have
fallen by 14 % overall in the period considered. Similarly, although the market share of all other
countries first increased to 38,4 % in 2001, it has since fallen to 31,1 %. Thus imports from all other
countries have lost both volume and market share, while at the same time import volumes and
market share of the PRC increased. Price of imports from all other countries were constantly higher
than prices from PRC.

(106)

It is therefore provisionally concluded that imports of FPFAF originating in countries other than the
PRC have not contributed to the injury suffered by the Community industry.

3.2. Changes in the pattern of consumption

(107) As mentioned in recital (66), the consumption of FPFAF in the Community fell by less than 1 %
during the period considered. Had the Community industry been able to maintain its market share it
would have suffered a loss in sales volumes in the EC of only 900 000 running metres as a result of
this fall
in EC sales volume was, however, 19 000 000 running
metres, which is more than 21 times greater. Therefore, the pattern of consumption has provisionally
been considered not to have been a material cause of any injury suffered by the Community industry.

in consumption. The actual fall

3.3. Performance of other Community producers

(108) Although only limited information on the performance of other Community producers is available,
in the light of the fact that twelve producers supported the complaint and taking account of general
market information on the sector, it can be reasonably presumed, that they also suffered material
injury from the dumped imports. In the absence of any indication that their situation would be
different from that of the Community industry, other Community producers cannot be considered as
a cause of injury to the Community industry.

3.4. Conclusion on Causation

(109) During the period considered, there were significant increases in volumes and market shares of
imports from the PRC, which also undercut significantly the prices of the Community industry,
and showed a striking coincidence in time with the deterioration of
the
Community industry.

the situation of

(110) No other factors have been put forward or been found which could have affected in a significant way

the situation of the Community industry.

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(111) Based on the above analysis, which has properly distinguished and separated the effects of all known
factors having an effect on the situation of the Community industry, from the injurious effect of the
dumped imports, it is therefore provisionally concluded that the imports from the PRC have caused
material injury to the Community within the meaning of Article 3(6) of the basic Regulation.

E. COMMUNITY INTEREST

1. General considerations

(112)

It has been examined whether, despite the findings on injurious dumping, compelling reasons existed
that could lead to the conclusion that it would be against the Community interest to adopt anti-
dumping measures in this particular case. For this purpose and in accordance with Article 21(1) of
the basic Regulation, the determination of Community interest was based on an appreciation of all
the various interests involved, i.e. those of the Community industry, other Community producers, the
importers/traders as well as the users and suppliers of raw materials concerning the product under
consideration.

(113) The Commission sent questionnaires to importers/traders, suppliers of raw materials, industrial users
as well as various associations of users. Only one supplier and one importer/user made substantive
responses.

2. Interest of the Community industry and of other Community producers

(114)

It is recalled that the Community industry consists of 7 producers which directly employ around
1 800 staff, 790 of whom worked in the production and sales of FPFAF during the IP. Their
production is estimated to represent around 30 % of total production in the Community.

(115) The imposition of measures is expected to restore fair competition on the market and prevent further
injury to the Community industry. The Community industry should then be able to increase its sales
and market share, and become profitable again. This should lead to a general improvement of the
Community industry’s financial situation.

(116) On the other hand, it is considered that, in the absence of anti-dumping measures on imports of
FPFAF from the PRC, the situation of the Community industry would worsen through increased
imports at dumped prices from the PRC leading to increased financial losses. The essential viability of
the industry would be threatened in the absence of measures to eliminate the injurious dumping, and
indeed, one of the complainants has already become insolvent.

(117) Concerning other Community producers, part of them expressed their support to the complaint and
nobody opposed to it. We can therefore reasonably provisionally conclude that anti-dumping
measures would not be against their interest.

(118) Accordingly, it is provisionally concluded that the imposition of anti-dumping measures would allow
the Community industry to recover from the effects of injurious dumping and would be in the
interest of the Community industry.

3. Interest of unrelated importers

(119) Only one importer made itself known to the Commission. This importer stated that it purchased
FPFAF from the PRC due to its different construction and lower prices, but expressed no view on the
possible imposition of measures. This importer which represented a negligible proportion of imports
from China, did not, however, submitted a substantiated reply to the questionnaire. No traders made
themselves known to the Commission.

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(120) Therefore, it was impossible with regard to importers and traders to make a proper assessment of the
possible effects of taking measures or not taking measures. It should also be recalled that anti-
dumping measures are not intended to prevent imports, but to ensure that they are not made at
injuriously dumped prices. As fairly-priced imports will still be allowed to enter into the Community
market, and as imports from third countries will also continue, it is likely that the traditional business
of importers will not be substantially affected even if anti-dumping measures against dumped imports
are imposed. The absence of comments by unrelated importers further underscores this conclusion.

(121) Therefore,

it

is provisionally concluded that

the imposition of measures would not have any

significant effect on importers.

4. Interest of suppliers of raw materials

(122)

It is recalled that some Community producers receive their raw material from group companies
(integrated producers). Others rely on suppliers independent of the Community producers.

(123) The complaint by the Community industry was supported by the International Rayon and Synthetic
Fibres Committee, a representative association of manufacturers of fibres including polyester filament
yarn, the raw material for the production of FPFAF. They pointed out that sales of yarn to producers
of FPFAF in the Community represent 25 % of their members total production and are thus of great
importance to their members.

(124)

In addition, one individual supplier of raw material to the Community industry made itself known to
the Commission. They argued that their ability to continue to invest would be negatively affected if
dumped imports from PRC were allowed to continue.

(125) Considering the above arguments, it is provisionally concluded that it is not against the interest of

suppliers of raw materials to impose measures on FPFAF from PRC.

5. Interest of users

(126) FPFAF is mainly used by the apparel industry. Depending on the exact specifications it is used in
for making sportswear,
It is also used to some extent in the manufacture of items such as

for making nightwear and lingerie, and,

making linings for clothing,
workwear and outerwear.
children’s car seats, push chairs etc.

(127) Nine submissions from users of FPFAF were received. Of these only one user currently imports part
of the FPFAF from the PRC. The latter argued that the prices charged by the Community industry
were higher and that measures should not be imposed as it would increase their costs and reduce the
competitiveness of their products, particularly compared to imports of apparel from the PRC. This
user further argued that as they currently source FPFAF both within the Community and in the PRC,
an increase in their costs leading to loss of competitiveness on their part would negatively affect not
only themselves but also the Community industry from whom they also buy. The other users noted
that the imposition of duties would probably lead to an increase in the cost of the imported product,
but that they were unlikely to be directly affected by such an increase.

(128)

In view of the comments made, it is considered that any cost increase for the users would be unlikely
to be significant. Moreover, it should be recalled that imports from the PRC may continue to enter
the Community market, but at fair prices, and that other non-dumped sources will remain available.
In the light of this,
it is provisionally concluded that provisional measures against PRC will not
significantly affect the interest of users.

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6. Conclusion on Community Interest

(129) The imposition of measures is in the interest of

the Community industry, other Community
producers, and suppliers to the Community industry.
It will allow the Community industry to
increase production, sales and market share and return to profitability. Should measures not be
imposed, it is expected that the Community industry would suffer significant losses due to further
decreases of sales and continued price depression on the Community market, which would lead to
continuing loss of market share against increased imports originating in the PRC and a further
deterioration in their sales prices as they would attempt to slow the decline in their market share.
These negative effects on the Community industry would in turn negatively affect suppliers to the
Community industry who would also suffer reduced demand forcing them to lower production.

(130) Although the measures would be expected to increase the price of imports,

importers have not
expressed concern about possible measures and it is considered that they would not be significantly
affected by the imposition of measures. As regards users it was found that the imposition of measures
would not have a significant effect on their profit margin or, consequently, on their activity,
considering the alternative sources of supply and the fact that the great majority of users did not
react.

(131) After weighing the interests of the various parties involved, the Commission provisionally concludes
that there are no compelling reasons not to impose provisional anti-dumping measures against
imports FPFAF originating in the PRC.

F. PROPOSAL FOR PROVISIONAL ANTI-DUMPING MEASURES

1. Injury elimination level

(132)

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

(133) For the purpose of establishing the level of the provisional measures, account has been taken of both
the dumping margin found and the amount of duty necessary to eliminate the injury sustained by the
Community industry.

(134) The provisional measures should be imposed at a level sufficient to eliminate the injury caused by
these imports without exceeding the dumping margin found. When calculating the amount of duty
necessary to remove the effects of the injurious dumping, it was considered that any measures should
allow the Community industry to cover its costs of production and obtain overall a profit before tax
that could be reasonably achieved by an industry of this type in the sector under normal conditions
in the absence of dumped imports, on the sales of the like product in the
of competition,
Community. The pre-tax profit margin used for
(i.e.
EUR 5,7 m) and it is in line with the profit made by the Community industry in 1998 and 1999,
before Chinese exports started to be a problem. On this basis a non-injurious price was calculated for
the Community industry of the like product by adding the above mentioned profit margin of 8 % to
the cost of production.

this calculation was 8 % of

turnover

i.e.

(135) The necessary price increase was then determined on the basis of a comparison of the weighted
average import price, as established for the undercutting calculations, with the average non-injurious
price. Any difference resulting from this comparison was then expressed as a percentage of the
average import CIF value. These differences were in all cases above the dumping margin found.

(136)

In the light of the foregoing, it is considered that a provisional anti-dumping duty should be imposed
at the level of the lowest of the dumping and injury margins found, in accordance with Article 7(2)
of the basic Regulation.

2. Provisional measures

16.3.2005

EN

Official Journal of the European Union

L 69/29

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

(138) Any claim requesting the application of these individual company anti-dumping duty rates (e.g.
following a change in the name of the entity or following the setting-up of new production or
sales entities) should be addressed to the Commission (3) forthwith with all relevant information, in
particular any modification in the company's activities linked to production, domestic and export
sales associated with e.g. that name change or that change in the production and sales entities. If
appropriate, the Regulation will accordingly be amended by updating the list of companies benefiting
from individual duty rates.

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

Company

Anti-dumping duty

Fuzhou Fuhua Textile & Printing Dyeing Co. Ltd.

Fuzhou Ta Tung Textile Works Co. Ltd.

Hangzhou Delicacy Co. Ltd.

Far Eastern Industries (Shangai) Ltd.

Hangzhou Hongfeng Textile Co. Ltd.

Hangzhou Jieenda Textile Co. Ltd.

Hangzhou Mingyuan Textile Co. Ltd.

Hangzhou Shenda Textile Co. Ltd.

Hangzhou Yililong Textile Co. Ltd.

Hangzhou Yongsheng Textile Co. Ltd.

Hangzhou ZhenYa Textile Co. Ltd.

Huzhou Styly Jingcheng Textile Co. Ltd.

Nantong Teijin Co. Ltd.

Shaoxing Ancheng Cloth industrial Co. Ltd.

Shaoxing County Jiade Weaving and Dyeing Co. Ltd.

Shaoxing County Pengyue Textile Co. Ltd.

Shaoxing County Xingxin Textile Co. Ltd.

Shaoxing Yinuo Printing Dyeing Co. Ltd.

(3) European Commission

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

20,0 %

20,0 %

20,0 %

20,0 %

20,0 %

20,0 %

20,0 %

20,0 %

20,0 %

20,0 %

20,0 %

20,0 %

20,0 %

20,0 %

20,0 %

20,0 %

20,0 %

20,0 %

L 69/30

EN

Official Journal of the European Union

16.3.2005

Company

Anti-dumping duty

Wujiang Longsheng Textile Co. Ltd.

Wujiang Xiangshen Textile Dyeing Finishing Co. Ltd.

Zheijang Tianyuan Textile printing and Dying Co. Ltd.

Zhejiang Shaoxing Yongli Printing and Dyeing Co. Ltd.

Zhejiang Xiangsheng Group Co. Ltd.

Zhejiang Yonglong enterprises Co. Ltd.

Zhuji Bolan Textile Industrial development Co. Ltd.

Wujiang Canhua Import & Export Co. Ltd.

Shaoxing County Huaxiang Textile Co. Ltd.

Shaoxing Ronghao Textiles Co. Ltd.

Shaoxing County Qing Fang Cheng Textile import and export Co. Ltd.

Shaoxing Tianlong import and export Ltd.

Hangzhou CaiHong Textile Co. Ltd.

Hangzhou Fuen Textile Co. Ltd.

Hangzhou Jinsheng Textile Co. Ltd.

Hangzhou Xiaonshan Phoenix Industry Co. Ltd.

Hangzhou Zhengda Textile Co. Ltd.

Shaoxing China Light & Textile Industrial City Somet Textile Co. Ltd.

Shaoxing County Fengyi Textile Printing and Dying Co. Ltd.

Shaoxing Nanchi Textile Printing Dyeing Co. Ltd.

Shaoxing Xinghui Textiles Co. Ltd.

Shaoxing Yongda Textile Co. Ltd.

Zhejiang Huagang Dyeing and Weaving Co. Ltd.

Zheijang Golden time printing and Dying knitwear Co. Ltd.

Zheijang Golden tree SLK printing Dying and Sandwshing Co. Ltd.

Zheijang Shaoxiao Printing and Dying Co. Ltd.

All other companies

20,0 %

20,0 %

20,0 %

20,0 %

20,0 %

20,0 %

20,0 %

74,8 %

26,7 %

33,9 %

33,9 %

63,4 %

39,4 %

39,4 %

39,4 %

39,4 %

39,4 %

39,4 %

39,4 %

39,4 %

39,4 %

39,4 %

39,4 %

39,4 %

39,4 %

39,4 %

85,3 %

G. FINAL PROVISION

(140)

In the interest of sound administration, a period should be fixed within which the interested parties
which made themselves known within the time limit specified in the notice of initiation may make
their views known in writing and request a hearing. Furthermore, it should be stated that the findings
concerning the imposition of duties made for the purposes of this Regulation are provisional and
may have to be reconsidered for the purpose of any definitive duty.

16.3.2005

EN

Official Journal of the European Union

L 69/31

HAS ADOPTED THIS REGULATION:

Article 1

1.
A provisional anti-dumping duty is hereby imposed on imports of woven fabrics of synthetic filament
yarn containing 85 % or more by weight of textured and/or non-textured polyester filament, dyed or
printed, originating in the People’s Republic of China, falling within CN codes 5407 52 00, 5407 54 00,
5407 61 30, 5407 61 90 and ex 5407 69 90 (TARIC code 5407 69 90 10).

2.
The rate of the provisional anti-dumping duty applicable, before duty, to the net free-at-Community-
frontier price of the products described in paragraph 1 and manufactured by the companies below shall be
as follows:

Company

Anti-dumping duty

TARIC Additional code

Fuzhou Fuhua Textile & Printing Dyeing Co. Ltd.

Fuzhou Ta Tung Textile Works Co. Ltd.

Hangzhou Delicacy Co. Ltd.

Far Eastern Industries (Shangai) Ltd.

Hangzhou Hongfeng Textile Co. Ltd.

Hangzhou Jieenda Textile Co. Ltd.

Hangzhou Mingyuan Textile Co. Ltd.

Hangzhou Shenda Textile Co. Ltd.

Hangzhou Yililong Textile Co. Ltd.

Hangzhou Yongsheng Textile Co. Ltd.

Hangzhou ZhenYa Textile Co. Ltd.

Huzhou Styly Jingcheng Textile Co. Ltd.

Nantong Teijin Co Ltd.

Shaoxing Ancheng Cloth industrial Co. Ltd.

Shaoxing County Jiade Weaving and Dyeing Co. Ltd.

Shaoxing County Pengyue Textile Co. Ltd.

Shaoxing County Xingxin Textile Co. Ltd.

Shaoxing Yinuo Printing Dyeing Co. Ltd.

Wujiang Longsheng Textile Co. Ltd.

Wujiang Xiangshen Textile Dyeing Finishing Co. Ltd.

Zheijang Tianyuan Textile printing and Dying Co. Ltd.

Zhejiang Shaoxing Yongli Printing and Dyeing Co. Ltd.

20,00 %

20,00 %

20,00 %

20,00 %

20,00 %

20,00 %

20,00 %

20,00 %

20,00 %

20,00 %

20,00 %

20,00 %

20,00 %

20,00 %

20,00 %

20,00 %

20,00 %

20,00 %

20,00 %

20,00 %

20,00 %

20,00 %

A617

A617

A617

A617

A617

A617

A617

A617

A617

A617

A617

A617

A617

A617

A617

A617

A617

A617

A617

A617

A617

A617

L 69/32

EN

Official Journal of the European Union

16.3.2005

Company

Anti-dumping duty

TARIC Additional code

Zhejiang Xiangsheng Group Co. Ltd.

Zhejiang Yonglong enterprises Co. Ltd.

Zhuji Bolan Textile Industrial development Co. Ltd.

Wujiang Canhua Import & Export Co. Ltd.

Shaoxing County Huaxiang Textile Co. Ltd.

Shaoxing Ronghao Textiles Co. Ltd.

Shaoxing County Qing Fang Cheng Textile import and
export Co. Ltd.

Shaoxing Tianlong import and export Ltd.

Hangzhou CaiHong Textile Co. Ltd.

Hangzhou Fuen Textile Co Ltd.

Hangzhou Jinsheng Textile Co. Ltd.

Hangzhou Xiaonshan Phoenix Industry Co. Ltd.

Hangzhou Zhengda Textile Co. Ltd.

Shaoxing China Light & Textile Industrial City Somet
Textile Co. Ltd.

Shaoxing County Fengyi Textile Printing and Dying Co.
Ltd.

Shaoxing Nanchi Textile Printing Dyeing Co. Ltd.

Shaoxing Xinghui Textiles Co. Ltd.

Shaoxing Yongda Textile Co. Ltd.

Zhejiang Huagang Dyeing and Weaving Co. Ltd.

Zheijang Golden time printing and Dying knitwear Co.
Ltd.

20,00 %

20,00 %

20,00 %

74,80 %

26,70 %

33,90 %

33,90 %

63,40 %

39,40 %

39,40 %

39,40 %

39,40 %

39,40 %

39,40 %

39,40 %

39,40 %

39,40 %

39,40 %

39,40 %

39,40 %

Zheijang Golden
Sandwshing Co. Ltd.

tree

SLK printing Dying

and

39,40 %

Zheijang Shaoxiao Printing and Dying Co. Ltd.

All other companies

39,40 %

85,30 %

A617

A617

A617

A618

A619

A620

A621

A622

A623

A623

A623

A623

A623

A623

A623

A623

A623

A623

A623

A623

A623

A623

A999

The release for free circulation in the Community of the product referred to in paragraph 1 shall be

3.
subject to the provision of a security, equivalent to the amount of the provisional duty.

4.

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

16.3.2005

EN

Official Journal of the European Union

L 69/33

Article 2

Without prejudice to Article 20 of Council Regulation (EC) No 384/96,
interested parties may request
disclosure of the essential facts and considerations on the basis of which this Regulation was adopted, make
their views known in writing and apply to be heard orally by the Commission within 30 days of the date of
entry into force of this Regulation.

Pursuant to Article 21(4) of Regulation (EC) No 384/96, the parties concerned may comment on the
application of this Regulation within 30 days of the date of its entry into force.

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

Article 3

Article 1 of this Regulation shall apply for a period of six months.

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

Done at Brussels, 15 March 2005.

For the Commission

Peter MANDELSON
Member of the Commission