Proposal for a Council Regulation terminating the new exporter review of Council Regulation (EC) No 1995/2000 imposing definitive anti-dumping duties on imports of urea ammonium nitrate (UAN) originating, inter alia, in Algeria
Date: 2005-06-21
Institutions: European Commission
Subjects: Algeria, anti-dumping duty, import, organic fertiliser, originating product

COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 21.6.2005 
COM(2005) 268 final 

Proposal for a 

COUNCIL REGULATION 

terminating the new exporter review of Council Regulation (EC) No 1995/2000 imposing 
definitive anti-dumping duties on imports of urea ammonium nitrate (UAN) originating, 
inter alia, in Algeria 

(presented by the Commission) 

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EXPLANATORY MEMORANDUM 

1)  CONTEXT OF THE PROPOSAL 

110 

•  Grounds for and objectives of the proposal 

This proposal concerns the application of Council Regulation (EC) No 384/96 of 
22 December 1995 on protection against dumped imports from countries not members 
of the European Community, as last amended by Council Regulation (EC) 
No 461/2004 of 8 March 2004 ("the basic Regulation") in terminating the new exporter 
review of Council Regulation (EC) No 1995/2000 imposing definitive anti-dumping 
duties on imports of urea ammonium nitrate (UAN) originating, inter alia, in Algeria. 

120 

•  General context 

This proposal is made in the context of the implementation of the basic Regulation and 
is the result of an investigation which was carried out in line with the substantive and 
procedural requirements laid out in the basic Regulation. 

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•  Existing provisions in the area of the proposal 

There are no existing provisions in the area of the proposal. 

•  Consistency with other policies and objectives of the Union 

Not applicable. 

2)  CONSULTATION OF INTERESTED PARTIES AND IMPACT ASSESSMENT 

•  Consultation of interested parties 

Interested  parties  concerned  by  the  proceeding  have  already  had  the  possibility  to 
defend their interests during the investigation, in line with the provisions of the basic 
Regulation. 

•  Collection and use of expertise 

There was no need for external expertise. 

•  Impact assessment 

This proposal is the result of the implementation of the basic regulation. 

The  basic  regulation  does  not  foresee  a  general  impact  assessment  but  contains  an 
exhaustive list of conditions that have to be assessed. 

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3)  LEGAL ELEMENTS OF THE PROPOSAL 

305 

•  Summary of the proposed action 

On 16 October 2004, the Commission announced, by Regulation (EC) No 1795/2004, 
the  initiation  of  a  ‘new  exporter’  review  of  Council  Regulation  (EC)  No  1995/2000 
imposing  definitive  anti-dumping  duties  on  imports  of  solutions  of  urea  and 
ammonium  nitrate  (‘UAN’)  originating,  inter  alia,  in  Algeria.  This  Regulation  also 
repealed  the  duty  with  regard  to  imports  from  Fertial  SPA  (the  ‘applicant’),  the 
Algerian  company  that  requested  the  initiation  of  the  review,  making  these  imports 
subject to registration. 

The  investigation  revealed  that  the  applicant’s  cost  accounting  records  contained 
significant shortcomings and that they could not be regarded as an appropriate basis to 
determine the applicant’s own dumping margin.  

Consequently,  the  Commission  services  were  not  in  a  position  to  determine  an 
individual margin of dumping on the basis of such reported data.  

It  is  therefore  proposed  to  reject  the  request  made  by  the  applicant,  to  terminate  the 
new exporter  review, and to  maintain the residual anti-dumping margin found during 
the original investigation, i.e. 9,7% (or € 6,88 per tonne), as nothing indicated that the 
applicant was dumping to a lesser extent. This duty should be collected retroactively on 
imports made subject to registration. 

Member States were consulted and supported this proposal unanimously. 

It is therefore proposed that the Council adopt the attached proposal for a Regulation 
which should be published in the Official Journal of the European Union no later than 
15 July 2005. 

310 

•  Legal basis 

Council  Regulation  (EC)  No  384/96  of  22  December  1995  on  protection  against 
dumped  imports  from  countries  not  members  of  the  European  Community,  as  last 
amended by Council Regulation (EC) No 461/2004 of 8 March 2004. 

329 

•  Subsidiarity principle 

The proposal falls under the exclusive competence of the Community. The subsidiarity 
principle therefore does not apply. 

•  Proportionality principle 

The proposal complies with the proportionality principle for the following reason(s). 

The form of action is described in the above-mentioned basic regulation and leaves no 
scope for national decision. 

Indication  of  how  financial  and  administrative  burden  falling  upon  the  Community, 
national governments, regional and local authorities, economic operators and citizens is 

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minimized and proportionate to the objective of the proposal is not applicable. 

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•  Choice of instruments 

Proposed instruments: regulation. 

Other means would not be adequate for the following reason(s). 

The above-mentioned basic regulation does not foresee alternative options. 

4)  BUDGETARY IMPLICATION 

409 

The proposal has no implication for the Community budget. 

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Proposal for a 

COUNCIL REGULATION 

terminating the new exporter review of Council Regulation (EC) No 1995/2000 imposing 
definitive anti-dumping duties on imports of urea ammonium nitrate (UAN) originating, 
inter alia, in Algeria 

THE COUNCIL OF THE EUROPEAN UNION, 

Having regard to the Treaty establishing the European Community, 

Having  regard  to  Council  Regulation  (EC)  No  384/96  of  22  December  1995  on  protection 
against dumped imports from countries not members of the European Community1 (the basic 
Regulation), and in particular Article 11(4) thereof,  

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

Whereas: 

(1) 

(2) 

1. MEASURES IN FORCE 

The measures currently in force on imports into the Community of solutions of urea 
and  ammonium  nitrate  (‘UAN’)  originating  in  Algeria  are  definitive  anti-dumping 
duties  imposed  by  Council  Regulation  (EC)  No  1995/20002.  Pursuant  to  that  same 
Regulation, anti-dumping  measures are also in force on UAN originating in Belarus, 
Russia and Ukraine. 

2. CURRENT INVESTIGATION 

2.1  Request for a review 

After the imposition of definitive anti-dumping duties on imports of UAN originating 
in  Algeria,  the  Commission  received  a  request  to  initiate  a  ‘new  exporter’  review  of 
Regulation  (EC)  No  1995/2000,  pursuant  to  Article  11(4)  of  the  basic  Regulation, 
from the Algerian company Fertial SPA (the ‘applicant’). The applicant claimed that it 
was  not  related  to  the  exporting  producer  in  Algeria  subject  to  the  anti-dumping 
measures in force with regard to UAN. Furthermore, it claimed that it had not exported 
UAN  to  the  Community  during  the  original  investigation  period  (i.e.  the  period 

1 

2 

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). 
OJ L 238, 22.9.2000, p. 15. Regulation as last amended by Council Regulation (EC) No 1675/2003 (OJ 
L 238, 25.9.2003, p. 4). 

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(3) 

(4) 

(5) 

(6) 

(7) 

from 1 June 1998 to 31 May 1999), but had started to export UAN to the Community 
thereafter. 

2.2 

Initiation of a ‘new exporter’ review 

The Commission examined the evidence submitted by the applicant and considered it 
sufficient to justify the initiation of a review in accordance with Article 11(4) of the 
basic  Regulation.  After  consultation  of  the  Advisory  Committee  and  after  the 
Community  industry  concerned  had  been  given  the  opportunity  to  comment,  the 
Commission  initiated,  by  Regulation  (EC)  No  1795/20043,  a  review  of  Regulation 
(EC) No 1995/2000 with regard to the applicant and commenced its investigation. 

Pursuant to Regulation (EC) No 1795/2004, the anti-dumping duty of € 6.88 per tonne 
imposed by Regulation (EC) No 1995/2000 on imports of UAN produced, inter alia, 
by the applicant was repealed. Simultaneously, pursuant to Article 14(5) of the basic 
Regulation, customs authorities were directed to take appropriate steps to register such 
imports. 

2.3  Product concerned 

The product concerned by the current review  is the same  as that in the  investigation 
that led to the imposition of the measures in force on imports of UAN originating in 
Algeria  (‘original  investigation’),  i.e.  mixtures  of  urea  and  ammonium  nitrate  in 
aqueous or ammoniacal solution, normally declared within CN code 3102 80 00 and 
originating in Algeria. 

2.4  Parties concerned 

The  Commission  officially  advised  the  applicant  and  the  representatives  of  the 
exporting  country  of  the  initiation  of  the  review.  Interested  parties  were  given  the 
opportunity to make their views known in writing and to be heard. 

The Commission sent a questionnaire to the applicant and received a reply within the 
deadline set for that purpose. The Commission sought to verify all the information it 
deemed  necessary  for  the  determination  of  dumping,  and  a  verification  visit  was 
carried out at the premises of the applicant. 

2.5 

Investigation period 

(8) 

The  investigation  of  dumping  covered  the  period  from  1  July  2003  to  30  June  2004 
(‘the investigation period’ or ‘IP’). 

3. RESULTS OF THE INVESTIGATION 

(9) 

The investigation confirmed that the applicant had not exported the product concerned 
during  the  original  investigation  period  and  that  it  had  begun  exporting  to  the 
Community after this period. 

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OJ L 317, 16.10.2004, p. 20. 

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(10)  The  Community  industry  argued  that  the  applicant  was  related  to  an  exporting 
producer  involved  in  the  original  investigation.  Although  a  company  related  to  the 
applicant  also  supplied  a  raw  material  to  the  exporting  producer  involved  in  the 
original  investigation,  nothing  indicated  that  such  relationship  would  go  beyond 
normal commercial transactions. Indeed, it was found that the company related to the 
applicant  was  not  related  to  the  exporting  producer  involved  in  the  original 
investigation. Accordingly, the argument that the applicant was related to an exporting 
producer involved in the original investigation was considered to be unfounded. 

(11)  However,  the  investigation  revealed  that  the  applicant’s  cost  accounting  records 
contained  significant  shortcomings  and  that  they  could  not  be  regarded  as  an 
appropriate basis to determine the applicant’s own dumping margin.  

(12) 

(13) 

It was found that costs of raw materials reported by the applicant were based on rough 
estimates for half of the IP, rather than actual costs.  

In addition, the reported costs, which were drawn from the company’s cost accounting 
system, could not be reconciled with the general accounting records. Indeed, no link 
could be established between the two accounting systems (cost accounting and general 
accounting)  normally  used  by  the  company,  since  the  figures  contained  in  the  cost 
accounting system records could not be matched with those contained in the general 
accounting  records.  Finally,  no  evidence  was  available  to  show  that  the  company’s 
cost accounting records were correct and reflected actual costs incurred during the IP. 
Therefore,  it  could  not  be  shown  that  the  records  reasonably  reflected  the  costs 
associated with the production and sale of the product under consideration. 

(14)  Consequently, it was not possible to determine an individual margin of dumping. 

4. CONCLUSION 

(15) 

It  should  be  noted  that  the  purpose  of  the  present  review,  initiated  upon  Fertial’s 
request,  was  to  determine  the  individual  margin  of  dumping  of  the  applicant,  which 
was allegedly different from the current residual margin applicable to imports of UAN 
from Algeria.  

(16)  As the investigation could not establish that the applicant’s individual dumping margin 
was  actually  different  from  the  residual  dumping  margin  established  in  the  original 
investigation,  the  request  made  by  the  applicant  should  be  rejected  and  the  new 
exporter  review  terminated.  The  residual  anti-dumping  margin  found  during  the 
original  investigation,  i.e.  9,7%  (or  €  6,88  per  tonne)  should  consequently  be 
maintained, as nothing indicated that the applicant was dumping at a different level. 

5. RETROACTIVE LEVYING OF THE ANTI-DUMPING DUTY 

(17) 

In  the  light  of  the  above  findings,  the  anti-dumping  duty  applicable  to  the  applicant 
shall  be  levied  retroactively  on  imports  of  the  product  concerned  which  have  been 
made subject to registration pursuant to Article 3 of Commission Regulation (EC) No 
1795/2004. 

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6. DISCLOSURE 

(18)  All  parties  concerned  have  been  informed  of  the  essential  facts  and  considerations 

which lead to the above conclusions.  

(19)  The applicant contested the Commission’s conclusions and argued that all information 
requested  had  been  provided.  Nevertheless,  no  new  evidence  was  submitted  which 
would warrant a revision of the above conclusions, and they were therefore confirmed. 

(20)  This  review  does  not  affect  the  date  on  which  the  measures  imposed  by  Regulation 
(EC)  No  1995/2000,  as  last  amended  by  Regulation  (EC)  Nº  1675/2003,  will  expire 
pursuant to Article 11(2) of the Basic Regulation. 

HAS ADOPTED THIS REGULATION: 

Article 1 

1. 

2. 

3. 

The  new  exporter  review  initiated  by  Regulation  (EC)  No  1795/2004  is  hereby 
terminated.  

The  duty  applicable  according  to  Article  1  of  Council  Regulation  (EC)  No 
1995/2000 to all companies in Algeria, is hereby levied retroactively on imports of 
mixtures  of  urea  and  ammonium  nitrate  in  aqueous  or  ammoniacal  solution  which 
have  been  registered  pursuant  to  Article  3  of  Commission  Regulation  (EC)  No 
1795/2004. 

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

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

Article 2 

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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