Proposal for a Council Regulation imposing a definitive anti-dumping duty on imports of certain castings originating in the People’s Republic of China
Date: 2005-07-12
Institutions: European Commission
Subjects: China, anti-dumping duty, anti-dumping legislation, cast-iron, import, iron and steel product, originating product, road services department

COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 12.07.2005 
COM(2005) 318 final 

Proposal for a 

COUNCIL REGULATION 

imposing a definitive anti-dumping duty on imports of certain castings originating in the 
People’s Republic of China 

(presented by the Commission) 

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EXPLANATORY MEMORANDUM 

1)  CONTEXT OF THE PROPOSAL 

• 

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  the  proceeding  concerning  imports  of 
certain castings originating in the People's Republic of China. 

• 

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. 

• 

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. 

3)  LEGAL ELEMENTS OF THE PROPOSAL 

• 

Summary of the proposed action 

On 30 April 2004, the Commission initiated an anti-dumping proceeding with regard to 
imports of certain castings originating in the People's Republic of China. The purpose 

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of  this  proceeding  was  to  investigate  whether  imports  from  the  People's  Republic  of 
China were dumped, thereby causing injury to the Community industry. 

The  investigation  established  that  imports  of  castings  originating  in  the  People' 
Republic of China were dumped and causedinjury to the Community Industry. It was 
therefore concluded that anti-dumping measures have to be imposed on imports from 
People's Republic of China. 

The  Member  States  were  consulted  regarding  the  proposal  for  the  imposition  of 
definitive duties. 

It is therefore proposed that the Council adopts the attached proposal for a Regulation 
which  should  be  published  in  the  Official  Journal  of  the  European  Union  by  29  July 
2005 at the latest. 

• 

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. 

• 

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 reasons: 

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

• 

Choice of instruments 

Proposed instruments: regulation. 

Other means would not be adequate for the following reason: 

Other  means  would  not  be  adequate  because  the  basic  Regulation  does  not  foresee 
alternative options. 

4)  BUDGETARY IMPLICATION 

The proposal has no implication for the Community budget. 

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Proposal for a 

COUNCIL REGULATION 

imposing a definitive anti-dumping duty on imports of certain castings originating in the 
People’s Republic of China 

THE COUNCIL OF THE EUROPEAN UNION, 

Having regard to the Treaty establishing the European Community, 

Having  regard  to  Council  Regulation  (EC)  No  384/961  of  22  December  1995  on  protection 
against dumped imports from countries not members of the European Community, (the ‘basic 
Regulation’) and in particular Article 9 thereof, 

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

Whereas: 

A. 

PROCEDURE 

(1) 

(2) 

(3) 

On  30  April  2004,  the  Commission  announced  by  way  of  a  notice  published  in  the 
Official Journal of the European Union2, the initiation of an anti-dumping proceeding 
concerning  imports  of  certain  castings  originating  in  the  People’s  Republic  of  China 
(‘PRC’). 

The  proceeding  was  initiated  following  a  complaint  lodged  in  March  2004  by 
EUROFONTE  (‘the  complainant’)  on  behalf  of  producers  representing  a  major 
proportion, in this case more than 50%, of the total Community production of castings. 
The complaint contained prima facie evidence of dumping of the said product and of 
material  injury  resulting  therefrom,  which  was  considered  sufficient  to  justify  the 
initiation of a proceeding. 

The  Commission  officially  advised  the  complainant,  the  Community  producers 
mentioned in the complaint, any other known Community producers, the authorities of 
the PRC, the exporting producers, importers, as well as the associations known to be 
concerned  of  the  initiation  of  the  investigation.  Interested  parties  were  given  the 
opportunity to make their views known in writing and to request a hearing within the 
time limit set in the notice of initiation. 

(4) 

A  number  of  Community  producers  represented  by  the  applicant,  other  cooperating 
Community producers, exporting producers, importers, suppliers and user associations 

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 C 104, 30.4.2004, p. 62. 

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(5) 

(6) 

(7) 

(8) 

(9) 

made their views known. All interested parties who so requested within the above time 
limit  and  showed  that  there  were  particular  reasons  why  they  should  be  heard  were 
granted the opportunity to be heard. 

1. Sampling, market economy treatment and individual treatment 

In  view  of  the  large  number  of  exporting  producers,  Community  producers  and 
importers  involved  in  the  investigation,  the  application  of  sampling  techniques  was 
envisaged  in  the  notice  of  initiation,  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, exporting producers and representatives acting on their 
behalf,  Community  producers  and  importers  were  requested  to  make  themselves 
known  and  to  provide  information  as  specified  in  the  notice  of  initiation.  The 
Commission  also  contacted  known  associations  of  exporting  producers  and  the 
authorities of the PRC. These parties raised no objections to the use of sampling. 

In  total,  33  exporters/producers  in  the  PRC,  24  Community  producers  and  15 
importers replied to the sampling questionnaire within the time limits and provided the 
requested information. 

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  initiation.  In  this  respect,  21  companies  requested 
MET pursuant to Article 2(7) of the basic Regulation, and 3 companies requested only 
IT pursuant to Article 9(5) of the basic Regulation. 

The selection of the sample for the exporting producers was made after consultation of 
the  PRC  co-operating  exporting  producers  and  of  the  authorities  of  the  PRC.  The 
sample  of  the  exporting  producers  was  established  on  the  basis  of  the  largest 
representative  volume  of  exports  to  the  Community (either  examined individually or 
examined  as  a  group  of  related  companies),  which  could  reasonably  be  investigated 
within the time available and on whether the companies intended to apply for Market 
Economy  Treatment.  Only  companies  that  intended  to  apply  for  Market  Economy 
Treatment  were  included  in  the  sample,  since  in  an  economy  in  transition,  normal 
value for other companies is established on the basis of prices or constructed normal 
value  of  an  analogue  third  country.  On  this  basis,  a  representative  sample  of  seven 
exporting  producers  was  selected.  The  seven  companies  sampled  represented, 
according  to  the  replies  to  the  sampling  exercise,  around  50%  of  all  co-operating 
producers’ exports. 

(10)  Regarding  the  Community  producers,  in  accordance  with  17(1)  of  the  basic 
Regulation,  the  sample  was  selected  after  consultation  of  the  co-operating  producers 
and with their consent on the basis of the largest representative volume of production 
and sales within the Community. As a result, five Community producers were selected 
in the sample. The Commission sent questionnaires to the five companies selected, and 
four complete replies were received within the set time limits. One of these companies 

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submitted  its  reply  outside  the  extended  time  limits  set  for  this  purpose  and  was 
therefore excluded from the proceeding. 

(11)  As for the importers, in accordance with 17(1) of the basic Regulation, the sample was 
selected after consultation of the co-operating importers and with their consent on the 
basis primarily of the largest representative imported volume into the Community and 
secondarily of the geographical distribution. Out of the 15 companies, two were found 
to  have  related  manufacturing  parties  in  the  PRC  and  were  excluded  from  the 
sampling,  as  they  should  be  investigated  in  the  framework  of  the  sampling  for  the 
exporting  producers.  As  a  result,  four  importers  were  selected,  out  of  which  three 
submitted complete questionnaire replies. 

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

(a) Community producers 

– 

– 

– 

– 

– 

Saint Gobain PAM, France, 

Saint Gobain, UK, 

Norford  France  and  to  its  related  traders  Norinco,  France  and  Norinco, 
UK, 

Cavanagh, Ireland, 

Fudiciones Odena, Spain, 

(b) Exporting producers in the PRC 

– 

– 

– 

– 

– 

– 

– 

Zibo Benito Metalwork Co. Ltd.; 

Benito Tianjin Metal products Co Ltd; 

Qingdao Benito Metal Products Co Ltd.; 

Shandong Huijin Stock Co., Ltd.; 

Shijiazhuang Transun Metal Products Co Ltd.; 

Changan Cast Limited Company of Yixian Hebei; 

Shanxi Yuansheng Casting and Forging Industrial Co. Ltd. 

(c) Importers in the Community related to exporting producers 

– 

Fundicio Ductil Benito, S.L, 

–  Mario Cirino Pomicino S.p.A; 

(d) Unrelated importers in the Community 

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– 

– 

Hydrotec, Germany, 

Peter Savage, UK. 

(13) 

In light 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  took  place  at  the  premises  of  the  following 
company: 

– 

Carnation industries Ltd., India. 

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

B. 

PRODUCT CONCERNED AND LIKE PRODUCT 

1.  General 

(15)  Castings  are  generally  comprised  of  a  frame,  which  is  embedded  in  the  ground,  and 
either a cover or a grate, which sits flush with any surface used by pedestrians and/or 
vehicles  and  which  directly  withstand  the  weight  and  impact  of  pedestrian  and/or 
vehicle traffic. The frame is placed directly on top of a concrete or brick chamber top. 
It is used to give access and/or gain entry to an underground chamber. 

(16)  Castings  serve  the  purpose  of  covering  an  underground  chamber  and  must  bear  load 
resistance of motored vehicles and/or pedestrian traffic. The cover or grate is required 
to remain secure within the frame in order to avoid noise pollution, human injury and 
vehicle  damage.  Castings  must  allow  for  safe  and  easy  access  to  the  underground 
chamber, may it be for the purpose of man entry or visual inspection. 

(17)  Castings vary in shape and dimensions. They are designed to match the dimensions of 
the  chamber  which  they  cover  and  provide  access  to.  The  frames  of  the  product  are 
normally circular, square or rectangular. Cover and grates are available in any shape 
including but not limited to triangular, circular, square or rectangular. 

(18)  Castings are made of grey or ductile iron. They are produced from varying amounts of 
steel  scrap,  coke,  pig  iron,  carbon  dust,  limestone,  ferro-silicon  and  magnesium 
dependent upon the manufacturing process and the type of end product, i.e. ductile or 
grey. There are two methods used to melt the iron during the production of castings, 
i.e. using either an electric furnace or a cupola. The production process is similar for 
castings  made  out  of  grey  or  ductile  iron.  The  main  difference  in  the  ductile 
production process is that magnesium is added to the carbon in the iron to change it 
from a flake form to sphericoidal structure, while this is not done for grey iron. Once 
the melting process is complete, the melted iron is either hand poured or mechanically 
poured into a mould. 

2. 

Product concerned 

(19)  The product concerned is certain articles of non-malleable cast iron of a kind used to 
cover and/or give access to ground or sub-surface systems, and parts thereof, whether 

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or  not  machined,  coated  or  painted  or  fitted  with  other  materials  originating  in  the 
PRC  ('the  product  concerned'),  normally  declared  within  CN  codes  7325  10  50  and 
7325 10 92 and occasionally declared within CN code 7325 10 99. These CN codes 
correspond  to  the  different  presentations  of  the  product  (including  manhole  covers, 
gully  tops  and  surface  boxes).  All  these  presentations  were  found  to  be  sufficiently 
similar  for  them  to  constitute  a  single  product  for  the  purpose  of  the  proceeding.  It 
should be noted that sub-surface fire hydrants are deemed materially different from a 
surface  box,  due  to  their  use  and  construction,  and  are  therefore  not  considered  the 
product concerned. 

(20)  The  production  of  castings  in  the  PRC  uses  predominantly  cupolas,  whilst  the 
Community industry predominantly uses electric furnaces during the melting process. 
Further, the production process in the PRC differs to that of the EU in that producers 
in  the  PRC  use  mainly  hand  pouring  whereas  the  EU  producers  employ  machine 
pouring.  Castings  are  made  of  grey  or  ductile  iron.  They  are  produced  from  varying 
amounts  of  steel  scrap,  coke,  pig  iron,  carbon  dust,  limestone,  ferro-silicon  and 
magnesium  dependent  upon  the  manufacturing  process  and  the  type  of  end  product, 
i.e. ductile or grey. There are two methods used to melt the iron during the production 
of castings, i.e. using either an electric furnace or a cupola. The production process is 
similar for castings made out of grey or ductile iron. The main difference in the ductile 
production process is that magnesium is added to the carbon in the iron to change it 
from a flake form to sphericoidal structure, while this is not done for grey iron. Once 
the melting process is complete, the melted iron is either hand poured or mechanically 
poured into a mould. Both grey and ductile castings are produced in the PRC. 

(21)  The  differences  between  grey  and  ductile  iron  are  that  grey  iron  is  made  of  flake 
graphite; this produces a more rigid material and ultimately mass secures the casting in 
place. Ductile iron is spheroidal graphite producing a more flexible product which has 
more ergonomic features but needs to be secured in place by a locking device. 

(22)  The investigation has shown, as mentioned above, that all types of castings despite the 
differences in terms of grey or ductile iron, have the same basic physical, chemical and 
technical  characteristics,  they  are  basically  used  for  the  same  purposes  and  can  be 
regarded as different types of the same product. 

(23)  Therefore,  for  the  purpose  of  this  investigation  the  product  concerned  is  castings,  as 

described in the general part, originating in the PRC. 

3. 

Like product 

(24)  No differences were found between the product concerned and castings produced and 
sold in India, which served as analogue country for the purpose of establishing normal 
value with respect of the PRC. 

(25)  No differences were found between the product concerned and the castings produced 

and sold in the Community by the Community industry. 

(26)  Certain parties argued that castings produced by the Community industry and sold on 
the  Community  market  were  not  alike  to  the  product  concerned.  They  claimed  in 
particular that norms used at European level are specified by EN124 standards and that 
national norms cover EN124 but usually stipulate further details thus creating distinct 

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differences  between  products  sold  on  each  national  market.  Additionally  certain 
parties  claimed  in  particular  that  they  distribute  the  so-called  gatic  product,  a 
commercial  alternative  to  standard  road  covers  which  is  used  in  a  discrete  niche 
market where engineering project specifications demand high performance standards. 
They argued that this product is a complementary product to the standard product, and 
cannot be seen as a substitute. It was therefore requested to exclude the gatic product 
from the definition of the product concerned. 

(27)  With regards to the first argument, it has to be noted that when sold on the Community 
market, both the like product and the product concerned need to comply with EN124 
standards  and  national  norms.  This  thus  determines  the  criteria  to  be  applied  in  the 
determination  of  the  “like  product”,  which  are  the  physical,  technical  and  chemical 
characteristics,  and  end  uses  or  functions  of  the  product.  Castings  produced  by  the 
Community  industry  and  sold  on  the  Community  market  are  made  of  grey  iron  or 
ductile  iron  and  were  found  to  have  the  same  basic  physical  and  technical 
characteristics and uses as the product concerned.Similarly, the differences in terms of 
national  norms  have  no  incidence  on  the  definition  of  the  like  product,  as  no  clear 
distinction  can  be  made  between  the  products  in  relation  to  their  basic  physical, 
technical  and  chemical  characteristics,  to  the  end  use  and  to  the  perception  of  users. 
Regarding  the  physical  and  technical  characteristics  of  the  product,  they  are 
determined  by  function,  installation  and  location,  and  are  mainly  the  traffic  load 
resistance  determined  by  the  so-called  loading  class,  the  cover  and  grate  stability 
within the frame and the safe and easy access. The product can be grey or ductile cast 
iron  and  the  cover  and/or  the  frame  of  manhole  can  be  filled  with  concrete  or  other 
materials.  As  for  the  uses  of  the  product,  castings  cover  and  frames  provide  an 
interface between buried networks and the road or pavement surface. All of the above 
characteristics also apply to the so-called gatic product, which can not be distinguished 
from  the  product  concerned  of  any  of  them.  The  argument  for  excluding  the  gatic 
product from the product concerned was therefore rejected. 

(28)  Finally,  no  differences  were  found  between  the  product  concerned  as  exported  and 

castings, which were produced and sold on the exporters’ domestic market. 

(29) 

It is therefore concluded that, in accordance with Article 1(4) of the basic Regulation 
and for the purpose of this investigation, all types of castings produced and sold on the 
domestic market of the PRC, those produced and sold in India and those produced and 
sold  by  the  Community  industry  on  the  Community  market  are  alike  to  the  product 
concerned. 

C. 

DUMPING 

1. 

Sampling 

(30) 

It is recalled that in view of the large number of companies involved, it was decided to 
make use of the provisions for sampling pursuant to Article 17 of the basic Regulation, 
and  that  for  this  purpose,  a  sample  of  seven  companies,  with  the  largest  export 
volumes to the EU was chosen, after consultation of the Chinese authorities. 

(31) 

In  this  respect,  the  analysis  subsequently  revealed  that  from  the  seven  companies 
originally selected, MET pursuant to Article 2(7)(b) of the basic Regulation could be 

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granted to one company, and that IT pursuant to Article 9(5) of the basic Regulation 
could be granted to three of the sampled companies. 

(32)  The  provisions  on  sampling  have  therefore  been  applied  as  follows.  The  individual 
dumping  margin  established  for  the  sole  company  to  which  MET  was  granted,  was 
also attributed to the non-sampled companies being granted MET. The companies to 
which IT was granted and which were not sampled were granted the weighted average 
of  the  dumping  margins  found  for  the  three  sampled  companies  which  were  granted 
IT. 

2.  Market economy treatment 

(33)  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  Article  2(7)  for  those  producers  which  were 
found to meet the criteria laid down in Article 2(7)(c) of the basic Regulation. 

(34)  Briefly,  and  for  ease  of  reference  only,  the  MET  criteria  are  set  out  in  summarised 

form below: 

(1) 

(2) 

(3) 

Business decisions and costs are made in response to market conditions and 
without State interference; 

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; 

(4) 

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

(5) 

Currency exchanges are carried out at the market rate. 

(35) 

In  the  present  investigation,  21  exporting  producers  in  the  PRC  made  themselves 
known  and requested MET pursuant to Article 2(7)(c) of the  basic  Regulation.  Each 
MET application was analysed. In view of the large number of companies concerned, 
on-spot investigations were carried out only at the premises of seven companies. 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  PRC  is  a 
producer and/or involved in sales (exports or domestic) 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. 

(36)  As  regards  the  companies  for  which  on-spot  investigations  were  carried  out,  the 
investigation revealed that one of the seven Chinese exporting producers fulfilled all 
the  conditions  for  MET.  The  remaining  six  applications  had  to  be  rejected  on  the 
grounds enumerated in the table below. 

(37)  As regards the remaining 14 companies, the analysis carried out individually for each 
company  concluded  that  MET  should  not  be  granted  to  10  companies.  Three  out  of 

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these  10  companies  did  not  properly  co-operate  in  the  investigation,  either  because 
they  did  not  provide  in  due  time  the  requested  information  or  because  they  were  a 
trader and the related manufacturing companies did not co-operate. For the other 7 out 
of  these  10  companies,  the  criteria  not  met  are  also  set  out  in  the  table  below.  The 
remaining 4 companies could successfully demonstrate that they met the five relevant 
MET criteria. 

(38)  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. It should be noted that although company 3 met each criteria individually, 
it cannot be granted MET on the grounds of its corporate relationship with companies 
1 and 2 listed below that did not fulfil all MET criteria. 

Compan
y 

1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

Criteria 

Article 
2(7)(c) 
indent 3 

Article 
2(7)(c) 
indent 2 

Not met 

Not met 

Article 
2(7)(c) 
indent 1 

Not met 

Not met 

Not met 

Not Met 

Met 

Not met 

Met 

Met 

Met 

Not met 

Not met 

Not met 

Met 

Not met 

Not met 

Not met 

Met 

Not met 

Not met 

Not met 

Not met 

Not met 

Not met 

Not met 

Not met 

Not met 

Not met 

Met 

Not met 

Met 

Met 

Met 

Met 

Met 

Met 

Not met 

Met 

Article 
2(7)(c) 
indent 4 

Article 
2(7)(c) 
indent 5 

Met 

Met 

Met 

Met 

Met 

Met 

Met 

Met 

Met 

Met 

Met 

Met 

Met 

Met 

Met 

Met 

Met 

Met 

Met 

Met 

Met 

Met 

Met 

Met 

Met 

Met 

Source: verified questionnaire replies of cooperating Chinese exporters. 

(39)  On  this  basis,  the  exporting  producers  in  the  PRC  which  obtained  MET  are  the 

following: 

(1) 

Shijiazhuang Transun Metal Products Co Ltd. 

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(2) 

Shaoshan Huanqiu Castings Foundry 

(3) 

Fengtai Handan Alloy Casting Co. Ltd. 

(4) 

Shanxi Jiaocheng Xinglong Casting Co. Ltd. 

(5) 

Tianjin Jinghai Chaoyue Industrial and Commercial Co. Ltd. 

3. 

Individual treatment 

(40)  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),  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. 

(41)  The 21 exporting producers which requested MET, also claimed individual treatment 
in the event of not being granted MET. Three additional exporting producers requested 
only individual treatment. 

(42)  Firstly,  as  regards  the  16  companies  that  claimed  but  failed  to  obtain  MET,  it  was 
found that 5 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,  3  companies  did  not 
properly  co-operate  in  the  investigation,  either  because  they  did  not  provide  in  due 
time the requested information or because they were a trading company and the related 
manufacturing  companies  did  not  co-operate,  as  already  indicated  at  recital  (37) 
above. 

(43)  The  8  remaining  companies  that  claimed  but  failed  to  obtain  MET  did  not  fulfil  the 
criterion as set out under Article 9(5)(c), first sentence, of the basic Regulation. As a 
consequence, these companies cannot be granted IT. 

(44)  Secondly, from the three companies that only requested IT, two stopped co-operating 
at  an  early  stage  of  the  proceeding.  The  third  applicant  was  found  to  be  a  trading 
company,  and  its  related  manufacturing  companies  did  not  co-operate.  These  three 
companies cannot therefore be granted IT. 

(45) 

It is concluded that IT should be granted to the following 5 companies: 

(1) 

Shandong Huijin Stock Co., Ltd. 

(2) 

Changan Cast Limited Company of Yixian Hebei. 

(3) 

Shanxi  Yuansheng  Casting  and  Forging  Industrial  Co.  Ltd.  and  its  related 
company Shanxi Yuansheng Industrial Co. Ltd. 

(4) 

Botou City Simencum Town Bai fo Tang Casting Factory. 

(5) 

Hebei Shunda Foundry Co. Ltd. 

(46)  A  number  of  exporting  producers  contested  the  determination  of  MES/IT.  However, 
these  parties  did  not  submit  any  new  information  which  would  lead  to  different 
conclusions in this respect. Consequently, these claims were rejected. 

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4.  Normal value 

4.1  Determination of normal value for the exporting producer granted MET 

(47)  The  Commission  first  established  whether  total  domestic  sales  of  this  exporting 
producer  were  representative  in  comparison  with  its  total  export  sales  to  the 
Community. In accordance with Article 2(2) of the basic Regulation, domestic sales of 
the  like  product  were  considered  representative  when  their  total  volume  was  at  least 
5% of the total sales volume of the product concerned to the Community. 

(48) 

It was found that the domestic sales of this exporting producer represented much less 
than 5% of the corresponding export volume to the Community. 

(49)  Consequently, in  accordance  with  Article 2(3) of the basic Regulation, normal value 
was constructed by adding to the exporter’s manufacturing costs of the exported types, 
a reasonable amount for selling, general and administrative expenses (‘SG&A’) and a 
reasonable margin of profit. In the absence of another company being granted MET in 
the  PRC  in  this  particular  case,  it  was  decided  to  make  use  of  the  SG&A  and  profit 
determined in the analogue country pursuant to Article 2(6)(c) of the basic Regulation. 
Beforehand,  the  Commission  verified  that  the  amount  for  profit  so  established  was 
reasonable and did not exceed the profit realised by the producer granted MET on its 
domestic sales. 

4.2  Determination  of  normal  value  for  the  exporting  producers  not  granted 

MET 

(a) 

Analogue country 

(50)  Pursuant 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. In the notice of initiation, the Commission indicated its 
intention  to  use  Norway  as  an  appropriate  analogue  country  for  the  purpose  of 
establishing normal value for the PRC and interested parties were invited to comment 
on this. A number of exporting producers in the PRC and importers in the Community 
objected  to  this  proposal  and  made  substantiated  submissions  showing  that  Norway 
was not an adequate analogue country and that India should be chosen instead. After 
investigation, the Commission services found that in terms of variety of product types, 
volume of domestic sales, competition on the domestic market, access to raw materials 
and production process, India was indeed a more appropriate analogue country to the 
PRC than Norway. All interested parties were informed of this determination and no 
objections were raised from any side. The Commission therefore sought and found full 
co-operation from one producer in India. 

(b) 

Determination of normal value 

(51)  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  the  verified  information 
received from a producer in a market economy third country, i.e. on the basis of prices 
paid or payable on the domestic market of India. It was verified that these transactions 
were (i) in the ordinary course of trade and (ii) were representative, in accordance with 
the methodology set out in recital (47). The investigation showed certain differences in 

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13 

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the  production  process  between  Indian  and  Chinese  manufacturers,  in  that  the  latter 
use less sophisticated equipment and require less use of energy. The Indian domestic 
selling  prices  were  therefore  adjusted downwards  by  an  amount  which  reflects  these 
differences.  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. 

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

to unrelated customers by the co-operating producer in India. 

5. 

Export price 

(53) 

(54) 

In those 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. This 
was the case for the three sampled companies granted IT. 

In the case where export sales to the Community were made via a related importer, the 
export price was constructed on the basis of the resale prices of this related importer to 
its  first  independent  customers,  in  accordance  with  Article  2(9)  of  the  basic 
Regulation.  Adjustments  were  made  for  all  costs  incurred  between  importation  and 
resale  by  that  related  importer,  including  SG&A  expenses,  and  a  reasonable  profit 
margin.  This  was  the  case  for  the  sole  company  granted  MET  and  for  the  three 
sampled companies not granted MET or IT. 

6.  Comparison 

(55)  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  with  Article  2(10)  of  the  basic  Regulation. 
Appropriate  adjustments  concerning  transport  and  insurance,  credit,  commission  and 
bank  charges  were  granted  in  all  cases  where  they  were  found  to  be  reasonable, 
accurate and supported by verified evidence. 

(56) 

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.  Dumping margin 

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

a) 

MET 

(57)  For the sole sampled company granted MET, the weighted average normal value for 
each type exported to the Community was compared with the weighted average export 
price of the corresponding type of the product concerned exported to the Community, 
as provided for under Article 2(11) of the basic Regulation. 

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(58)  The 4 companies which were granted MET, but which were not selected in the sample, 
were  attributed  the  dumping  margin  established  for  the  above  sampled  company,  in 
accordance with Article 9(6) of the basic Regulation. 

b) 

IT  

(59)  For  the  three  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 basic Regulation. 

(60)  The 2 non-sampled companies which were granted IT receive a dumping margin set at 
the  level  of  the  weighted  average  margin  of  dumping  established  for  the  above 
sampled companies that were granted IT. 

(61)  On  this  basis,  the  individual  dumping  margins  expressed  as  a  percentage  of  the  CIF 

value at the Community frontier price duty unpaid are: 

Shijiazhuang Transun Metal Products Co. Ltd. 

Shaoshan Huanqiu Castings Foundry 

Fengtai Handan Alloy Casting Co. Ltd. 

Shanxi Jiaocheng Xinglong Casting Co. Ltd. 

Tianjin Jinghai Chaoyue Industrial and Commercial Co. Ltd. 

Shanxi Yuansheng Casting and Forging Industrial Co. Ltd. 

Botou City Simencum Town Bai fo Tang Casting Factory 

Hebei Shunda Foundry Co. Ltd. 

Changan Cast Limited Company of Yixian Hebei 

Shandong Huijin Stock Co. Ltd. 

7.2  Countrywide dumping margin 

0,0% 

0,0% 

0,0% 

0,0% 

0,0% 

18,6% 

28,6% 

28,6% 

31,8% 

37,9% 

(62) 

In order to establish the countrywide dumping margin applicable to all other exporters, 
the Commission first established the level of cooperation. To this end, the following 
ratio  was  calculated.  The  numerator  is  the  export  volume  to  the  Community  of  co-
operating  companies  that  were  granted  neither  MET  nor  IT.  The  denominator  is  the 
total export volume originating in the PRC to the Community based on Eurostat, less 
the  export  volumes  of  companies  granted  MET  and  IT.  On  this  basis,  it  was 
established  that  the  level  of  co-operation  stood  at  22%,  which  is  considered  a  low 
level, even for a fragmented industry like the one of the product concerned. 

(63)  The countrywide dumping margin for the export volume of other exporting producers 

was determined as follows: 

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(64)  For  the  export  volume  of  non-co-operating  companies,  the  level  of  dumping  was 
determined  on  the  basis  of  the  two  product  categories  with  the  highest  margins 
established for the sampled exporting producers that were granted neither MET nor IT. 

(65)  The  co-operating  companies  that  were  granted  neither  MET  nor  IT  receive,  for  the 
purpose  of  the  current  computation  exercise,  a  notional  individual  margin  following 
the methodology established under recital (55). 

(66)  Finally, the country wide dumping margin was calculated based on the above notional 
individual  margins  by  using,  as  a  weighing  factor,  the  CIF  value  of  each  group  of 
exporters, i.e. co-operating and non-co-operating. 

(67)  On this basis the countrywide level of dumping was established at 47,8% of the CIF 

Community frontier price duty unpaid. 

D. 

COMMUNITY INDUSTRY 

(a) Community production 

(68) 

In the course of the investigation it was found that castings have been manufactured by 
the  4  complainant  Community  producers  selected  in  the  sample  and  by  5  other 
Community producers supporting the complaint. 

(b) Definition of the Community industry 

(69)  The  complainant  Community  producers  together  with  the  Community  producers 
supporting the complaint, which responded to the sampling exercise and co-operated 
with  the  investigation,  account  for  more  than  60%  of  Community  production  of  the 
like product. They are therefore deemed to constitute the Community industry within 
the meaning of Article 4(1) of the basic Regulation. 

(70)  One  complainant  company  stopped  co-operating  immediately,  after  initiation  of  the 
investigation.  Another  company  selected  for  the  sample,  submitted  its  reply  outside 
the  relevant  time  limit.  One  company  supporting  the  complaint  withdrew  its  support 
immediately after initiation. Consequently, these three companies were not included in 
the definition of Community industry.  

(71)  Certain parties argued that the two main complaining companies should be excluded 
from the definition of the Community industry as they imported massive quantities of 
castings originating in the PRC. In this respect, it should be firstly noted that, whereas 
it  is  indeed  a  long  standing  practice  that  importing  Community  producers  should  be 
excluded  from  the  Community  industry  if  they  are  either  shielded  from  dumping  or 
benefiting from it, they are not excluded if it is found that the Community producers 
were forced to have a temporary and very limited recourse to imports, because of the 
depressed price situation in the Community market. In this case, the total imports of 
these  two  companies  during  the  IP  were  below  3,5%  of  their  respective  total 
production  and  were  limited  to  certain  regions  in  the  Community  particularly 
depressed by the Chinese dumped imports. Given the small quantities at stake, the two 
Community  producers  can  be  considered  part  of  the  definition  of  the  Community 
industry within the meaning of Article 4(1) of the basic Regulation. On this basis, the 
argument was rejected. 

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E. 

INJURY 

(a) Preliminary remarks 

(72) 

In  view  of  the  fact  that  sampling  had  been  used  with  regard  to  the  Community 
industry,  injury  has  been  assessed  on  the  basis  of  the  information  collected.  Trends 
concerning production, capacity and utilisation of capacity, productivity, sales, market 
share, employment and growth were assessed at the level of the Community industry. 
In this respect, additional information was requested from all co-operating Community 
producers,  through  a  questionnaire  sent  to  all  non-sampled  co-operating  Community 
producers.  In  total,  five  non-sampled  companies  replied  and  their  information  was 
taken into account. As for the others, they were excluded from the proceeding as non-
cooperating.  Trends  concerning  prices  and  profitability,  cash  flow,  ability  to  raise 
capital  and  investments,  stocks,  returns  on  investments  and  wages  were  analysed  on 
the  basis  of  the  information  collected  at  the  level  of  the  sampled  Community 
producers. 

(73)  The analysis of the injury has shown that the penetration of dumped imports was not 
even  within  the  Community  market.  While  the  penetration  of  dumped  imports  was 
high in fourteen Member States, the French market was not as yet targeted by dumped 
imports. At the same time the weighting factor of the two sampled French producers in 
the  overall  situation  of  the  Community  industry  was  particularly  high  as  their 
production and sales of castings in France represented approximately 36% of the total 
production  and  total  sales  volume  of  the  Community  industry.  In  view  of  this 
particular situation, it was considered appropriate together with the injury analysis for 
the  Community  industry  as  a  whole,  to  present  an  analysis  of  the  trends  of  certain 
indicators  for  the  targeted  Community  market,  i.e.  the  Community  market  without 
France (EU14). 

(b) Apparent Community consumption 

(74)  Apparent consumption of castings in the Community was established on the basis of 
the production figures for the co-operating producers and the production of the other 
Community  producers  and  by  adding  imports  and  deducting  exports,  using  data 
derived  from  Eurostat  and  information  provided  by  the  complainant  regarding  the 
market  size  of  each  member  State  and  its  evolution  throughout  the  period  under 
examination. 

(75)  On the above basis, the apparent consumption of castings on the Community market, 
with  the  exception  of  a  slight  decrease  in  2002,  remained  rather  stable  around  580 
thousand  tonnes  throughout  the  period  under  examination.  The  market  of  castings 
depends  on  the  demand  influenced  by  the  relative  dynamism  in  the  sewage  or  water 
sector which is reliant with the overall economical development in each member State. 

Apparent consumption in the Community 

2000 

2001 

2002 

2003 

IP 

Tonnes  

Index 2000 = 100 

584 000 

597 000 

568 000 

577 000  578 750 

100 

102 

97 

99 

99 

Source: Questionnaire replies of the Community industry, complaint, Eurostat 

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(c) Volume of the imports from the country concerned and market share 

(76)  The volume of dumped imports of the product concerned originating in the PRC was 
derived by deducting from Eurostat figures the volumes of non-dumped imports. The 
volume of dumped imports grew up from 122 511 tonnes in 2000 to 179 755 tonnes in 
the IP, representing a sharp increase of 47%. 

2000 

2001 

2002 

2003 

IP 

Volume of imports (tonnes) 

122 511 

149 329 

163 135 

181 400 

179 755 

Index 2000 = 100 

100 

122 

133 

148 

147 

(77)  During the period under examination, the dumped imports from the PRC continuously 
increased their share of the Community market from 21,0% in 2000 to 31,1% in the 
IP. Therefore, there has been a significant increase in dumped imports in both absolute 
terms  and  relative  to  the  Community  consumption  (more  than  10  percentage  points) 
over the period under examination. 

Market share  

21,0% 

25,0% 

28,7% 

31,4% 

31,1% 

2000 

2001 

2002 

2003 

IP 

(d) Apparent consumption in EU14 

(78)  Apparent  consumption  of  castings  in  EU14  was  established  on  the  same  basis  as 
consumption  for  the  whole  of  the  Community  and  by  deducting  the  consumption  in 
France.  The  apparent  consumption  of  castings  in  the  EU14  remained  stable  slightly 
above 460 thousand tonnes throughout the period under examination. 

Apparent consumption in the Community 

2000 

2001 

2002 

2003 

IP 

Tonnes  

464 000 

480 000 

458 000 

462 000 

462 500

Index 2000 = 100 

100 

103 

99 

100 

100 

Source: Questionnaire replies of the Community industry, complaint, Eurostat 

(e) Volume of the imports from the country concerned and market share in the EU14 

(79)  The volume of dumped imports of the product concerned originating in the PRC was 
established by deducting from the Eurostat  figures  on total import  volumes  from the 
PRC the volumes of non-dumped imports and the volumes of imports of France. The 
latter deduction was considered sufficient to correctly reflect the dumped imports into 
the EU14, since according to the information submitted by the complainant producers 
no  significant  volumes  of  dumped  imports  have  entered  the  French  market.  The 
volume of dumped imports grew from 119 818 tonnes in 2000 to 171 946 tonnes in the 
IP, representing a sharp increase of 44%. 

EN 

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2000 

2001 

2002 

2003 

IP 

Volume of imports (tonnes) 

119 818 

145 509 

158 323 

172 886 

171 946 

Index 2000 = 100 

100 

121 

132 

144 

144 

(80)  During  the  period  under  examination,  the  dumped  imports  from  the  PRC  increased 
their share of the EU14 market from 25,8% in 2000 to 37,2% in the IP. The increase in 
market share is slightly higher than the one observed at total Community level over the 
period under examination. 

Market share  

25,82% 

30,31% 

34,57% 

37,42% 

37,18% 

2000 

2001 

2002 

2003 

IP 

(f) Prices of the dumped imports and price undercutting 

(i) Import prices 

(81)  Price information for the imports concerned which was based on the import volumes 
and  values  derived  from  Eurostat  data,  showed  that  between  2000  and  the  IP,  the 
average CIF prices of imports originating in the PRC decreased by 11%. The decrease 
was particularly steep in 2003 and the IP. 

2000 

2001 

2002 

2003 

IP 

Prices in €/tonne  

Index 2000 = 100 

548 

100 

560 

102 

531 

97 

486 

89 

489 

89 

Source: Eurostat 

(ii) Price undercutting and price depression 

(82)  For the purpose of calculating the level of price undercutting in the IP, the prices of 
the like product sold by the sampled Community industry producers were compared to 
the  prices  of  dumped  imports  of  the  co-operating  exporting  producers  sold  on  the 
Community market during the IP on the basis of weighted average prices per product 
type of castings, net of all rebates and taxes to unrelated customers. The prices of the 
Community  industry  were  adjusted  to  an  ex-works  basis.  The  prices  of  the  imports 
concerned  used  were  on  a  CIF  basis  with  an  appropriate  adjustment  for  the  customs 
duties and post importation costs. 

(83)  A  certain  number  of  co-operating  importers  argued  that  the  Community  producers 
sales  of  the  product  concerned  through  public  tenders  should  be  excluded  from  the 
undercutting  calculations  as  sales  to  public  authorities  may  include  services  and 
guarantees as well as other additional costs which render the products sold through a 

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tendering procedure objectively different from the products sold through normal trade 
negotiation.  In  this  respect,  it  should  be  firstly  noted  that  this  claim  was  not 
substantiated by evidence showing the difference in prices resulted from tenders and 
other trade negotiations. Moreover, the sales through public tenders of the sampled co-
operating  Community  producers  during  the  IP  represented  a  very  low  percentage  in 
volumes  and  as  such  they  could  not  have  a  significant  impact  on  the  undercutting 
calculations. On this basis, the claim was rejected. 

(84)  The  elements  taken  into  account  in  defining  the  product  types  were  mainly  the  raw 
material  used  for  the  product  concerned  (grey  cast  or  ductile  iron  with  or  without 
added concrete), its use (manhole covers, gully tops or surface boxes), its dimensions 
and different accessories and its conformity with the EN 124 European standards. 

(85)  This comparison showed that during the IP, the products concerned originating in the 
PRC  were  sold  in  the  Community  at  prices  which  significantly  undercut  the 
Community industry's prices, when expressed as a percentage of the latter, by margins 
ranging from 31% to 60%. 

(g) Economic Situation of the Community industry 

(86)  Pursuant  to  Article  3(5)  of  the  basic  Regulation,  the  Commission  examined  all 
relevant economic factors and indices having a bearing on the state of the Community 
industry from 2000 to the IP. 

(i) Production capacity, production, capacity utilisation 

(87)  The  Community  industry’s  production  capacity  increased  slightly  during  the  period 
under  examination  reflecting  a  restructuring  of  the  existent  capacity  rather  than  an 
increase  due  to  new  investments.  Over  the  same  period,  the  Community  industry 
decreased  its  production  by  7  percentage  points  and  its  capacity  utilisation  rate  by 
more than 8 percentage points. 

2000 

2001 

2002 

2003 

IP 

Production  capacity 
in tonnes  

295 287 

295 987 

302 487 

303 487 

303 487 

Index 2000 = 100 

100 

100 

102 

103 

103 

Production in tonnes  

244 983 

236 042 

211 495 

217 151 

227 100 

Index 2000 = 100 

100 

96 

86 

89 

93 

Production  capacity 
utilisation rates 

83,0% 

79,7% 

69,9% 

71,6% 

74,8% 

Source: Questionnaire replies of the Community industry. 

(88) 

In  EU14,  the  production  capacity  of  the  Community  industry  recorded  a  similar 
increase  to  the  one  recorded  at  Community  level.  However,  its  production  and 
production capacity utilisation decreased more steeply by 14 percentage points. 

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2000 

2001 

2002 

2003 

IP 

Production  capacity 
in tonnes  

188 287 

188 987 

191 737 

191 987 

191 987 

Index 2000 = 100 

100 

100 

102 

102 

102 

Production in tonnes  

169 749 

168 624 

140 969 

140 834 

145 819 

Index 2000 = 100 

100 

99 

83 

83 

86 

Production  capacity 
utilisation rates 

90,2% 

89,2% 

73,5% 

73,4% 

76,0% 

Source: Questionnaire replies of the Community industry. 

(ii) Sales volume, market share and growth 

2000 

2001 

2002 

2003 

IP 

Sales in tonnes 

249 053 

237 632 

211 706 

221 250 

224 545

Index 2000 = 100 

100 

95 

85 

89 

90 

Market share 

42,6% 

39,8% 

37,3% 

38,3% 

38,8% 

(89)  The  Community  industry  decreased  its  sales  volume  by  10%  and  subsequently  its 
market share went down by 3,8 percentage points over the period under examination, 
while the dumped imports increased their volume by 47% and their market share by 
10,1%. 

(90) 

In the EU14, the Community industry suffered a higher loss in market share (5,4%) as 
its sales decreased significantly (-17%) over the period under examination. 

2000 

2001 

2002 

2003 

IP 

Sales in tonnes 

151 987 

143 367 

123 504 

126 896 

126 492

Index 2000 = 100 

100 

94 

81 

83 

83 

Market share 

32,76% 

29,87% 

26,97% 

27,47% 

27,35% 

(iii) Employment and Productivity 

(91)  The level of employment of the Community industry decreased over the period under 
examination  by  13%.  The  productivity  of  the  Community  industry  as  measured  by 
tonnes  produced  annually  per  employee  increased  from  133  tonnes  in  2000  to  141 
tonnes in the IP. This increase in output per person is mainly attributed to the efforts of 

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the  Community  industry  to  rationalise  its  production  and  to  cope  with  the  raising 
dumped imports. 

2000 

Number of employees 

1 843 

Index 2000 = 100 

100 

2001 

1 783 

97 

2002 

1 721 

93 

2003 

1 657 

90 

IP 

1 610 

87 

Productivity: 
production/employee 

133 

132 

123 

131 

141 

Source: Questionnaire replies of the Community industry 

(92)  Similarly the level of employment of the Community industry in EU14 decreased over 
the period under examination, however, more steeply as it recorded a decrease of 16%. 
Its productivity increased from 132 tonnes in 2000 to 135 tonnes in the IP. 

2000 

Number of employees 

1 290 

Index 2000 = 100 

100 

2001 

1 238 

96 

2002 

1 187 

92 

2003 

1 128 

87 

IP 

1 084 

84 

Productivity: 
production/employee 

132 

136 

119 

125 

135 

Source: Questionnaire replies of the Community industry 

(iv) Stocks 

(93)  The stock levels of the Community industry increased by 16% during the period under 
examination. The build-up of stocks reflects the sales level reduction at a faster pace 
than that of the production level. 

2000 

2001 

2002 

2003 

IP 

Inventories  

33 815 

36 964 

37 510 

37 455 

39 375 

Index 2000 = 100 

100 

109 

111 

111 

116 

(v) Sales prices and factors affecting domestic prices 

(94)  The  sampled  Community  industry  producers’  average  net  sales  price  remained 
practically  stable.  This  stability  does  not  however  reflect  the  significant  increase  of 
34% in the steel scrap price, the main costing element in the cost of production of the 
product  concerned  between  2002  and  the  IP.  In  this  respect,  it  should  be  noted  that 
every  change  in  the  steel  scrap  price  is  directly  and  fully  reflected  in  the  cost  of 
production  of  the  product  concerned  since  this  is  the  main  input  in  its  production 
process.  The  Community  industry  could  not  therefore  let  pass  this  increase  into  the 
selling prices, which would have been reasonably expected in the absence of dumped 
imports putting pressure on them and given that the average import prices from other 
countries were substantially higher than those from the PRC. 

EN 

22 

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2000 

2001 

2002 

2003 

IP 

Average 
(EUR/tonne)  

selling 

price 

1 131 

1 157 

1 153 

1 141 

1 153 

Index 2000 = 100 

100 

102 

102 

101 

102 

Source: Questionnaire replies of the sampled Community industry 

(95)  Similar  stability  was  observed  for  the  average  net  sales  price  of  the  Community 

industry producers’ in EU14. 

2000 

2001 

2002 

2003 

IP 

Average 
(EUR/tonne)  

selling 

price 

1 056 

1 070 

1 053 

1 031 

1 048 

Index 2000 = 100 

100 

101 

100 

98 

99 

Source: Questionnaire replies of the sampled Community industry 

(vi) Profitability 

(96)  The  sampled  Community  industry  producers’  return  on  net  sales  in  the  Community 
market to unrelated customers, before taxes, decreased from 12,1% in 2000 to 9,9% in 
the  IP  representing  a  drop  of  18  percent  over  the  period  under  examination.  This 
decrease was even sharper until the year 2002. Since then the profitability developed 
rather positively showing at first sight a certain capacity of the Community industry to 
recover from a difficult financial situation. In this respect, it should be noted that the 
same  trend  was  observed  in  several  indicators,  such  as  the  production,  capacity 
utilisation, productivity and sales volume. 

2000 

2001 

2002 

Profitability 

12,1% 

10,5% 

8,1% 

Index 2000 = 100 

100 

87 

67 

2003 

9,4% 

78 

IP 

9,9% 

82 

Source: Questionnaire replies of the sampled Community industry producers. 

(97)  The  profitability  in  the  EU14  decreased  from  9,4%  in  2000  to  5,3%  in  the  IP 
representing a drop of 44 indexed points over the period under examination. Although 
it showed a positive development after 2002, its profitability did not recover to levels 
similar to the one achieved in 2000 which are considered appropriate for this type of 
industry.  

Profitability 

Index 2000 = 100 

2000 

9,4% 

100 

2001 

5,9% 

63 

2002 

1,0% 

11 

2003 

4,3% 

46 

IP 

5,3% 

56 

Source: Questionnaire replies of the sampled Community industry producers. 

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(vii) Investments and return on investments 

(98)  The  level  of  investments  in  the  production  of  the  product  concerned  made  by  the 
sampled  Community  industry  producers  decreased  by  half  during  the  period  under 
examination from EUR 12 million to approximately EUR 6 million. 

(99)  The  sampled  Community  industry  producers’  return  on  investment,  which  expresses 
their pre-tax result as a percentage of the average opening and closing net book value 
of assets employed in the production of the product concerned, was positive during the 
period  2000  to  2001,  reflecting  their  declining  profit  making  situation.  As  for  the 
period after 2001, similarly as with the profitability, whereas a decrease was observed 
in 2002, this was subsequently recovered in 2003 and the IP. 

2000 

2001 

2002 

2003 

IP 

Investments in 000€ 

12 091 

10 989 

6 497 

6 496 

6 124 

Index 1999 = 100 

100 

91 

54 

54 

51 

Return on investments 

32,4% 

29,0% 

23,7% 

30,1% 

33,9% 

Source: Questionnaire replies of the sampled Community industry. 

(viii) Ability to raise capital 

(100)  There  were  no  indications  that  the  Community  industry  as  a  whole  encountered 

problems in raising capital for its activities. 

(ix) Cash flow 

(101)  The  sampled  Community  industry  producers  recorded  a  declining  net  cash  inflow 

from operating activities during the period under examination. 

2000 

2001 

2002 

2003 

IP 

Cash flow in 000€ 

51 162 

40 295 

39 517 

41 955 

40 824 

Index 2000 = 100 

100 

79 

77 

82 

80 

flow 
Cash 
percentage of turnover 

expressed 

as 

19% 

16% 

17% 

18% 

17% 

Source: Questionnaire replies of the sampled Community industry producers 

(102)  Also in EU 14, the sampled Community industry producers recorded a declining net 
cash  inflow  from  operating  activities  during  the  period  under  examination.  However 
this decline was much steeper as was the decline in the net cash inflow expressed as a 
percentage to turnover (4%) in relation to their activity in the whole Community. 

EN 

24 

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2000 

2001 

2002 

2003 

IP 

Cash flow in 000€ 

23 869 

18 081 

13 468 

15 724 

15 556 

Index 2000 = 100 

100 

76 

56 

66 

65 

flow 
Cash 
percentage of turnover 

expressed 

as 

17% 

13% 

12% 

13% 

13% 

Source: Questionnaire replies of the sampled Community industry producers 

(x) Wages 

(103)  Over the period under examination, the average wage per employee increased by 9%. 
After  remaining  stable  in  2000  and  2001,  wages  increased  by  2%  in  2002  with  a 
further  increase  of  5%  and  2%  being  recorded  in  2003  and  the  IP.  However,  taking 
into  account  the  reduction  in  employment,  the  total  wage  bill  of  the  sampled 
Community  industry  producers  remained  relatively  stable  over  the  period  under 
examination. 

2000 

2001 

2002 

2003 

IP 

Wages per employee in € 

42 470 

42 504 

43 474 

45 336 

46 203 

Index 2000 = 100 

100 

100 

102 

107 

109 

Source: Questionnaire replies of the sampled Community industry 

(xi) Magnitude of dumping margin 

(104)  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, this 
impact is substantial. 

(xii) Recovery from past dumping 

(105)  The  Community  industry  was  not  in  a  situation  where  it  had  to  recover  from  past 

effects of injurious dumping. 

(h) Conclusion on injury 

(106)  The examination of the above mentioned factors shows that between 2000 and the IP, 
the  dumped  imports  increased  sharply  in  terms  of  volume  and  market  share.  Indeed, 
their volume increased by 47% during the period under examination and they achieved 
a market share of approximately 31% in the IP. It is to be noted that they accounted for 
approximately 80% of total imports of the product concerned into the Community in 
the IP, and they substantially undercut (up to a maximum of 60%) the sales prices of 
the Community industry. Moreover, other injury indicators, such as production (-7%), 
capacity  utilisation  (-10%),  sales  in  volume  (-10%),  investments  (-49%)  and 
employment (-13%) developed negatively over the period under examination. 

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25 

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(107)  At the same time the Community industry lost part of its market share. As a matter of 
fact,  the  imports  concerned  picked-up  a  three  fold  additional  market  share  than  that 
lost by the Community industry over the period under examination. Therefore, it can 
be reasonably concluded that the Chinese imports have taken over on top of the market 
share lost by the Community industry the market share from other European foundries 
which either have gone out of business, or have been converted into importers/traders. 

(108)  The  overall  above  negative  picture  was  only  partially  reflected  in  the  recorded 
profitability of the Community industry. Measured in absolute terms profits declined 
by 18%. Profitability (profits as a percentage of sales revenue) went down from a level 
of 12,1% to 9,9%. Against substantial levels of undercutting, one might have expected 
greater  injury.  However,  profitability  measured  on  its  own  does  not  represent  the 
complete picture.  

(109)  The Community industry had a choice of competing head-on in price with the Chinese 
imports,  or  trying  to  maintain  prices  at  or  near  their  historical  levels.  The  degree  of 
price decrease that would have been needed to compete directly with dumped imports 
would  clearly  have  been  in  excess  of  what  Community  producers  would  have 
contemplated if they were to remain profitable. Although, they reduced prices to some 
extent,  they  did  not  seek  to  match  the  prices  of  dumped  imports  It  follows  that  they 
accepted reduced volumes, and then sought to cut costs in order to compensate for the 
loss volume. Thus, profits as a percentage of sales revenue did not decline so sharply, 
but this was at the expense of a drop in sales volumes and a loss in market share. 

(110)  Moreover, the isolated analysis of the situation in the EU14 revealed that the relatively 
high  profitability  at  global  Community  level,  during  the  IP,  was  mainly  due  to  the 
particularly  good  performance  of  certain  sampled  companies  in  the  market  of  one 
Member State, i.e. France, where the penetration of dumped imports was limited. The 
financial situation of the sampled companies resulting from their operations in EU14, 
where  the  penetration  of  dumped  imports  was  particularly  high,  showed  a  clear 
negative  trend  and  profitability  levels  were  found  to  have  fallen  below  6%.  In  the 
EU14, the majority of injury indicators, such as production (-14%), capacity utilisation 
(-14%), sales in volume (-17%), investments (-56%), employment (-16%), cash flow 
(-45%) developed more negatively over the period under examination. 

(111)  The  Community  industry  as  a  whole  lost  market  share  during  the  period  under 
examination at a time when the dumped imports increased substantially, both in terms 
of  volumes  and  market  share.  Confronted  with  the  increasing  pressure  from  the 
dumped  imports,  the  Community  industry  opted  for  improving  its  productivity  by 
decreasing its employment. At the same time they had to decrease investments, which 
fell sharply. This was reflected in the development of certain indicators over the period 
under  examination.  Indeed,  profitability,  likewise  sales,  and  production  in  volume 
after  a  sharp  drop  in  the  period  2000-2002  developed  rather  positively  until  the  IP. 
With  regard  to  the  first  period,  it  can  be  reasonably  assumed  that  the  escalating 
pressure from the steadily increasing dumped imports led to a lower level of activity 
and  results  for  the  Community  industry.  As  for  the  second  period,  the  relative 
improvement  of  these  indicators  shows  the  efforts  of  the  Community  industry  to 
counteract  the  negative  effects  of  the  dumped  imports  on  its  short  term  financial 
situation by streamlining production facilities increasing thus capacity utilisation and 
by  reducing  investments  and  employment  lowering  thus  production  costs.  This 
nevertheless endangers its long-term financial heath since it is losing market share and 

EN 

26 

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renounces  to  investments  necessary  to  maintain  and  even  improve  its  long-term 
productivity and competitiveness. 

(112)  In the light of the foregoing, and albeit the fact that the French market appears not as 
yet to have been aggressively targeted by the dumped imports, it can be concluded that 
the Community industry as a whole has suffered material injury. It has suffered severe 
price  pressure,  it  has  lost  sales  volumes  (-10%),  market  share  (-3,8%)  and  has  been 
forced to cut production (-7%). It has retained a certain level of profitability, but not a 
level which enables investment for the long term to take place. Its overall situation has 
shown signs of severe degradation. On that basis it is concluded that the Community 
industry  has  suffered  material  injury  within  the  meaning  of  Article  3(5)  of  the  basic 
Regulation. 

F. 

CAUSATION 

(a) Introduction 

(113)  In  order  to  reach  its  conclusions  on  the  cause  of  injury  faced  by  the  Community 
industry  and  in  accordance  with  Article  3(6)  and  (7)  of  the  basic  Regulation,  the 
Commission examined the impact of all known factors and their consequences on the 
situation in that industry. Known factors other than the dumped imports, which at the 
same  time  could  be  injuring  the  Community  industry,  were  also  examined  to  ensure 
that the possible injury caused by these other factors was not attributed to the dumped 
imports. 

(b) Effects of the dumped imports  

(114)  Over  the  period  under  examination,  dumped  imports  from  the  PRC  increased 
considerably in volume (47%) and in market share (from 21,0% in 2000 to 31,1% in 
the IP).  

(115)  The  prices  of  the  dumped  imports  were  below  those  of  the  Community  industry 
throughout  the  whole  period  under  examination.  Moreover,  they  exerted  a  pressure, 
which forced the Community industry to maintain its own prices practically stable, in 
spite of the substantial increase in the cost of raw materials. Prices of dumped imports 
originating  in  the  PRC  significantly  undercut  Community  industry  prices  with 
undercutting margins ranging from 31% to 60%. In this regard, it should be noted that 
the castings market is a competitive and transparent market. Thus, price undercutting 
in a market with such characteristics is a detrimental factor that diverts trade towards 
Chinese dumped imports. 

(116)  The  effects  of  dumped  imports  can  also  be  illustrated  by  the  decision  of  numerous 
Community producers to discontinue their own production lines and become importers 
of castings. 

(117)  Overall, between 2000 and the IP, the Community industry’s loss of market share of 
3,8  percentage  points  is  totally  absorbed  by  the  increase  in  market  share  of  dumped 
imports originating in the PRC. 

EN 

27 

   EN 

 
(118)  The  loss  in  market  share  experienced  by  the  Community  industry  coincided  with  a 
number  of  other  negative  developments  in  its  overall  economic  situation  in  terms  of 
production, production capacity utilisation, sales, investment and employment. 

(119)  Moreover,  the  Community  industry  experienced  a  decrease  in  its  profitability  which 
dropped from 12,1% in 2000 to 9,9% in the IP.  These factors, coupled with the fact 
that the Community industry was not able to increase its prices in order to counteract 
the  negative  effect  of  the  price  increase  of  raw  materials,  due  to  the  price  pressure 
from  the  dumped  imports,  had  the  effect  that  in  spite  of  rationalisations  and 
improvement  of  its  productivity,  it  found  itself  in  an  injurious  situation..  The 
expansion  of  the  dumped  imports  market  share  and  the  drop  in  the  prices  coincided 
with the sharp change in the conditions for the Community industry. 

(120)  A certain number of co-operating importers argued that whereas the increased volume 
of Chinese imports into the Community is a direct result of the growing demand for 
the  product  concerned,  the  market  for  the  Community  industry  recorded  a  general 
negative  trend  due  to  the  decline  in  demand  of  castings  in  the  telecommunications 
market  in  2002.  This  market  reached  its  maximum  development  in  the  years  before 
2002,  distorting  thus  the  injury  analysis,  since  the  years  2000  and  2001  were 
exceptionally good. As for the period after 2002, an improvement has been registered 
in the results of the Community industry pointing to a healthy industry. 

(121)  In this respect, it should be firstly noted that the investigation did not show a growing 
demand but rather a stable consumption against steadily increasing imports throughout 
the period under examination. Regarding the impact of the telecommunications market 
in 2002, this was not reflected in the Chinese imports of the product concerned which 
continued  steadily  growing  at  dumped  prices.  Furthermore,  the  claim  was  not 
substantiated  with  evidence.  Finally,  the  investigation  showed  that  the  Community 
industry suffered material injury over the period under examination. On this basis, the 
above arguments were rejected. 

(c) Effects of other factors 

Imports from other third countries 

(122)  Import volumes from other third countries decreased from 70 600 tonnes in 2000 to 49 
000 tonnes in the IP, their market share decreased from 12% in 2000 to 8,5% in the IP. 
Most of these imports originated in Poland, the Czech Republic and India. However, 
on  the  basis  of  Eurostat  data,  the  average  prices  of  castings  imported  from  third 
countries  were  on  average  considerably  higher  than  the  corresponding  prices  of 
dumped imports originating in the PRC (from 12% difference in 2000 they reached a 
55%  difference  in  the  IP).  Moreover,  on  average,  the  prices  from  other  countries 
increased by 16 percentage points over the period under examination. Therefore, these 
imports cannot have caused injury to the Community industry. 

Performance of other Community producers 

(123)  As regards the production and sales volumes of the other Community producers, they 
held  a  market  share  of  around  18,5%  during  the  IP.  During  the  period  under 
examination,  their  sales  have  decreased  steeply  in  terms  of  volume  (21%)  and  they 
have lost considerable market share (4,9 percentage points). No indication was found 

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28 

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that  the  prices  of  other  Community  producers  were  lower  than  those  of  the  co-
operating  Community  industry.  Therefore,  it  can  be  reasonably  concluded  that  the 
products  produced  and  sold  by  the  other  Community  producers  have  not  caused 
material injury to the Community industry. 

(124)  No  other  factors,  which  could  at  the  same  time  cause  injury  to  the  Community 
industry,  were  raised  by  interested  parties  or  identified  during  the  course  of  the 
investigation. 

(d) Conclusion on causation 

(125)  The vulnerable situation of the Community industry coincided with a sharp increase in 

imports from the PRC and a substantial price undercutting by these imports. 

(126)  As to the  imports  from other third countries, in view of their declining market share 
over the period under examination and in view of the average prices which were found 
to  be  considerably  higher  than  those  of  the  dumped  imports  during  the  IP,  it  is 
concluded  that  these  factors  have  not  contributed  to  the  injury  suffered  by  the 
Community industry. 

(127)  It  is  therefore  concluded  that  the  dumped  imports  originating  in  PRC  have  caused 
material injury  to the Community industry within the  meaning of Article 3(6) of the 
basic Regulation. 

G. 

COMMUNITY INTEREST 

(128)  In  accordance  with  Article  21  of  the  basic  Regulation,  the  Commission  considered 
whether  the  imposition  of  the  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  and  traders,  and  the  users  of  the  product 
concerned. 

(129)  In order to assess the Community interest, the Commission carried out an investigation 
into the likely effects of the imposition/non-imposition of anti-dumping measures on 
the  economic  operators  concerned.  In  addition  to  the  Community  producers  and 
importers, the Commission requested information from all interested parties known to 
be concerned such as users and consumers associations. 

(a) Interest of the Community industry 

(130)  The  Community  industry  is  composed  of  large  as  well  as  small  and  medium-sized 

companies. 

(131)  The  imposition  of  measures  is  expected  to  prevent  a  further  distortion  of  the  market 
and  a  deterioration  of  prices.  This  would  enable  the  Community  industry  to  recover 
lost market share, while still selling at cost covering prices, which again will lead to 
lower  unit  costs  due  to  higher productivity.  In  conclusion,  it  is  expected  that  mainly 
the  decrease  in  unit  costs  (due  to  a  higher  capacity  utilisation  and  subsequently  the 
higher  productivity)  and  to  a  certain  extent  a  slight  price  increase,  will  allow  the 
Community  industry  to  improve  its  financial  situation,  without  distorting  the 
consumers market. 

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29 

   EN 

 
(132)  On the other hand, should anti-dumping measures not be imposed, it is likely that the 
negative trend of the financial situation of the Community industry will continue. The 
situation  of  the  Community  industry  is  particularly  marked  in  the  IP  by  a  loss  of 
revenue due to depressed prices and further decreasing market share. Indeed, in view 
of  the  decreasing  revenue,  it  is  most  likely  that  the  financial  situation  of  the 
Community  industry  will  deteriorate  further  in  the  absence  of  any  measures.  This 
would  ultimately  lead  to  cuts  in  production  and  more  closures  of  production  sites, 
which would therefore threaten employment and investments in the Community. 

(133)  Accordingly,  it  is  concluded  that  the  imposition  of  anti-dumping  measures  would 

allow the Community industry to recover from the injurious dumping. 

(b) Interest of unrelated importers /traders in the Community 

(134)  As mentioned in recital (11), fifteen 15 companies provided the information requested 
in  the  notice  of  initiation  for  selecting  a  sample  within  the  time  limit  set  for  this 
purpose.  From  these  companies,  a  representative  sample  of  four  importers  was 
selected. Questionnaires were sent to all four companies. 

- sampled unrelated importers /traders in the Community 

(135)  Out  of  the  four  sampled  companies,  one  did  not  reply  to  the  questionnaire  and  was 
therefore  excluded  from  the  proceeding.  All  other  selected  companies  provided  full 
and  complete  questionnaire  replies.  These  companies  accounted  for  19%  of  total 
imports of castings in volume originating in the PRC during the IP. 

(136)  A certain number of co-operating importers claimed that one sampled importer should 
not have been selected as it is a subsidiary of another company, which is allegedly the 
largest  individual  customer  of  a  complainant  company,  and  a  supplier  of  that 
complainant  company.  This  alleged  relationship  was  claimed  to  be  sufficient  to 
exclude  this  importer  from  the  sample  as  it  constitutes  a  conflict  of  interest.  In  this 
respect, it should be noted that the alleged relationship between that importer and the 
complainant company does not go beyond that of a commercial relationship between 
independent  economic  operators  and  as  such  could  not  justify  a  conflict  of  interest. 
Furthermore, the claim was not substantiated. This argument was therefore rejected. 

(137)  They further argued that the imposition of measures would most likely have an impact 
on employment in the Community user industry and the importers. It was alleged that, 
since the latter have no margin to absorb any duty, they would be immediately forced 
out  of  business  causing  them  to  lay  off  their  personnel  at  once.  In  addition,  it  was 
argued  that  there  is  a  substantial  increase  in  demand  in  the  Community,  especially 
account  being  taken  of  the  ten  new  member  States  which  in  a  process  of  rapid 
development will further boost it. In this context, the imposition of duties could also 
lead to a shortage in supplies on the European market and, consequently, a major price 
increase.  Furthermore,  the  Community  producers  would  then  be  free  to  control  the 
market in the absence of any significant competition. 

(138)  In respect of the negative impact of measures on employment in the Community user 
industry and the importers, this was not substantiated. Regarding the negative impact 
for users in the Community, as stated below (140), no user or user association made 
itself  known  in  the  framework  of  the  proceeding.  Regarding  the  negative  impact  on 

EN 

30 

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importers,  contrary  to  the  allegations,  the  strong  position  established  by  them  in  the 
Community  market  reflects  their  healthy  and  steadfast  situation  rather  than  a  frail 
state. Furthermore, it should be noted that the absorption of the duty would render void 
the very purpose of its imposition, which is to restore a fair playing field in the market 
found  to  be  distorted  from  uncompetitive  behaviour  of  operators  having  adopted 
dumping practices. As for the alleged shortage in supplies due to the increased demand 
of the ten new member States, it should be firstly noted that the Community industry 
does  not  produce  at  full  capacity  and  therefore  any  shortage  could  be  covered  by 
increasing its capacity utilisation and reducing stocks. In addition, existing production 
in certain new member States together with imports from third countries will continue 
to supply the market at reasonable prices contributing to a transparent and competitive 
environment. 

(139)  Therefore, it can be concluded that the likely effects of the imposition of anti-dumping 

measures on unrelated importers/traders would not be significant. 

(c) Interest of users and consumers 

(140)  No user or consumer associations made themselves known within the time limit set in 
the notice of initiation. Given the non-cooperation of these parties, it can be concluded 
that  the  imposition  of  any  anti-dumping  measure  would  not  unduly  affect  their 
situation. 

(d) Competition and trade distorting effects 

(141)  With respect to the effects of possible measures on competition in the Community, it 
appears likely that the exporting producers concerned will be able to continue to sell 
castings,  albeit  at  non-injurious  prices,  as  they  have  a  strong  market  position.  This 
taken  with the  large  number  of producers in the Community and imports from other 
third countries will ensure that users and retailers will continue to have a wide choice 
of  different  suppliers  of  castings  at  reasonable  prices.  A  certain  number  of  co-
operating importers argued that the Community industry is not competitive and that it 
is characterised by the presence of local and regional markets which are dominated by 
monopolies/duopolies.  They  further  submitted  that  one  of  the  Community  co-
operating producers had been condemned in the past for an abuse of dominant position 
to impede the access of the product concerned to the French market. 

(142)  In  this  respect,  it  should  be  firstly  noted  that  the  argument  concerning  the  alleged 
presence of local and regional markets, dominated by monopolies/duopolies, was not 
substantiated by any evidence and was therefore rejected. Concerning the decision on 
the  abuse  of  dominant  position,  it  refers  to  a  situation  in  the  past,  fully  outside  the 
period  under  examination  and  to  product  outside  the  product  scope  of  this 
investigation.  In  addition,  a  subsequent  relevant  decision  within  the  period  under 
examination  on  a  complaint  lodged  by  an  importer  against  the  same  producer 
regarding  its  anti-competitive  behaviour  on  the  French  market  did  not  condemn  the 
producer  and  the  procedure  was  terminated.  On  this  basis,  the  above  argument  was 
rejected. 

(143)  Thus, there will be an important number of actors in the market, which will be able to 
satisfy  the  demand.  On  the  basis  of  the  above,  it  is  therefore  concluded  that 

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competition  will  most  likely  remain  strong  after  the  imposition  of  anti-dumping 
measures. 

(e) Conclusion on Community interest 

(144)  In  the  light  of  the  above,  it  is  concluded  that  no  compelling  reasons  exist  against 
imposing measures in the present case and that the application of measures would be 
in the interest of the Community. 

H. 

DEFINITIVE ANTI-DUMPING MEASURES 

1. 

Injury elimination level 

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

(146)  For this purpose, first the import prices were compared with the Community industry’s 
prices  without  making  an  adjustment  for an adequate profit margin. The comparison 
was made with regard to comparable product types. The difference was expressed as a 
percentage  of  the  corresponding  export  turnover.  This  analysis  showed  for  all 
exporting producers’ margins which were already above their dumping margins. Thus, 
in order to apply the lesser-duty-rule, it was not considered necessary to determine a 
profit  margin  which  the  Community  industry  could  have  achieved  in  the  absence  of 
dumped imports, as the corresponding injury margin would have been higher than the 
dumping margin. 

(147)  In the light of the foregoing, it is considered that, in accordance with Article 7(2) of 
the basic Regulation, definitive anti-dumping duties  should  be  imposed  in  respect  of 
imports of castings originating in the PRC at the level of the dumping margins found 
as these would, in all cases, be lower than the injury margins. 

(148)  The  individual  anti-dumping  duty  rate  for  the  companies  granted  market  economy 
status specified in this Regulation was established on the basis of the findings of the 
present investigation. Therefore, it reflects 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  PRC  and  produced  by  these  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 this  specifically mentioned, cannot benefit from 
this rate and shall be subject to the countrywide duty. 

(149)  Any claim requesting the application of an individual company anti-dumping duty rate 
(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 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 
Regulation will accordingly be amended by updating the list of companies benefiting 
from individual duties. 

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(150)  In view of the findings above, the anti-dumping duty rates are as follows: 

Country 

Company 

The PRC 

Shijiazhuang Transun Metal Products Co. Ltd. 

Shaoshan Huanqiu Castings Foundry 

Fengtai Handan Alloy Casting Co. Ltd. 

Shanxi Jiaocheng Xinglong Casting Co. Ltd. 

Tianjin Jinghai Chaoyue Industrial and Commercial Co. Ltd. 

Shanxi Yuansheng Casting and Forging Industrial Co. Ltd. 

Botou City Simencum Town Bai fo Tang Casting Factory 

Hebei Shunda Foundry Co. Ltd. 

Changan Cast Limited Company of Yixian Hebei 

Shandong Huijin Stock Co. Ltd. 

All other companies 

Anti-
dumping 
duty  

0,0%

0,0%

0,0%

0,0%

0,0%

18,6%

28,6%

28,6%

31,8%

37,9%

47,8%

(151)  All  parties  were  informed  of  the  essential  facts  and  considerations  on  the  basis  of 
which it was intended to recommend the imposition of definitive anti-dumping duties. 
They  were  also  granted  a  period  within  which  they  could  make  representations 
subsequent to this disclosure. The oral and written comments submitted by the parties 
were  duly  considered,  and,  where  appropriate,  the  findings  have  been  modified 
accordingly.  All  parties  were  given  detail  responses  to  the  comments  they  have 
submitted. 

I. 

FORM OF MEASURES  

(152)  Four  exporting  producers  having  obtained  individual  treatment  indicated  that  would 
offer a price undertaking but failed to submit a sufficiently substantiated undertaking 
offer within the deadlines set in Article 8(2) of the basic Regulation. Consequently no 
undertaking offers could be accepted by the Commission. Nevertheless, the Council in 
view  of  the  complexity  of  the  issue  for  the  economic  operators  in  question 
(predominantly  small  and  medium  sized  enterprises)  and  given  that  the  definitive 
disclosure  was  not  preceded  by  a  provisional  disclosure,  considers  that  they  should 
exceptionally  be  allowed  to  complete  their  undertaking  offers  beyond  the  above 
mentioned deadline. 

(153)  The  Chinese  authorities  also  requested  that  consideration  be  given  to  finding  a 
comparable  solution  for  the  numerous  co-operating  Chinese  exporting  producers 
concerned  by  the  proceeding,  as  for  the  four  exporting  producers  mentioned  in  the 
previous recital. Should it be found, following discussion to that end, that a change in 

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the form of the measures other than the acceptance of undertakings, is appropriate an 
interim review will be carried out as expeditiously as possible. 

HAS ADOPTED THIS REGULATION: 

Article 1 

1. 

2. 

A  definitive  anti-dumping  duty  is  hereby  imposed  on  imports  of  castings  of  non-
malleable cast iron of a kind used to cover and/or to give access to ground or sub-
surface  systems,  and  parts  thereof,  whether  or  not  machined,  coated  or  painted  or 
fitted  with  other  materials,  excluding  fire  hydrants,  originating  in  the  People’s 
Republic  of  China,  currently  classifiable  within  CN  codes  7325  10  50,  7325  10  92 
and ex- 7325 10 99 (Taric code 7325 10 99 10). 

The  rate  of  the  definitive  anti-dumping  duty  applicable  to  the  net,  free-at-
Community-frontier  price,  before  duty,  for  products  described  in  paragraph  1  and 
produced in the People’s Republic of China by the companies listed below shall be 
as follows: 

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Company 

Anti-
dumping 
duty (%) 

Taric 
additional 
code  

Shijiazhuang Transun Metal Products Co. Ltd., Xinongcheng, 
Liulintun,  Luancheng  County,  Shijiazhuang  City,  Hebei 
Province, 051430, PRC 

Shaoshan  Huanqiu  Castings  Foundry,  Fengjia  Village, 
Yingtian Township, Shaoshan, Hunan, PRC 

Fengtai  Handan  Alloy  Casting  Co.  Ltd.,  Beizhangzhuang 
Town, Handan County, Hebei, PRC 

Shanxi  Jiaocheng  Xinglong  Casting  Co.  Ltd.,  Jiaocheng 
County, Shanxi Province, PRC 

Tianjin Jinghai Chaoyue Industrial and Commercial Co. Ltd., 
Guan  Pu  Tou  Village,  Yang  Cheng  Zhuang  Town,  Jinghai 
District, 301617 Tianjin, PRC 

Shanxi  Yuansheng  Casting  and  Forging  Industrial  Co.  Ltd., 
No. 8 DiZangAn, Taiyuan, Shanxi, 030002, PRC 

Botou  City  Simencum  Town  Bai  fo  Tang  Casting  Factory, 
Bai  Fo  Tang  Village,  Si  Men  Cum  Town,  Bo  Tou  City, 
062159, Hebei Province, PRC 

Hebei  Shunda  Foundry  Co.  Ltd.,  Qufu  Road,  Quyang, 
073100, PRC 

Changan  Cast  Limited  Company  of  Yixian  Hebei,  Taiyuan 
main street, Yi County, Hebei Province, 074200, PRC 

Shandong  Huijin  Stock  Co.  Ltd.,  North  of  Kouzhen  Town, 
Laiwu City, Shandong Province, 271114, PRC. 

All other companies 

0,0  A675 

0,0  A676 

0,0  A677 

0,0  A678 

0,0  A679 

18,6  A680 

28,6  A681 

28,6  A682 

31,8  A683 

37,9  A684 

47,8  A999 

3. 

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

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Article 2 

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

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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