Proposal for a Council Regulation terminating the anti-dumping proceeding concerning imports of styrene-butadiene-styrene thermoplastic rubber originating in the Republic of Korea and Russia, terminating the interim review of the anti-dumping measures applicable to imports of styrene-butadiene-styrene thermoplastic rubber originating in Taiwan and repealing these measures
Date: 2005-07-26
Institutions: European Commission
Subjects: Russia, South Korea, Taiwan, anti-dumping duty, anti-dumping legislation, originating product, rubber industry, synthetic rubber

COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 26.7.2005 
COM(2005) 337 final 

Proposal for a 

COUNCIL REGULATION 

terminating the anti-dumping proceeding concerning imports of styrene-butadiene-
styrene thermoplastic rubber originating in the Republic of Korea and Russia, 
terminating the interim review of the anti-dumping measures applicable to imports of 
styrene-butadiene-styrene thermoplastic rubber originating in Taiwan and repealing 
these measures 

(presented by the Commission) 

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EXPLANATORY MEMORANDUM 

1)  CONTEXT OF THE PROPOSAL 

110 

•  Grounds for and objectives of the proposal 

This  proposal  concerns  the  application  of  Council  Regulation  (EC)  No  384/96  of  22 
December 1995 on protection against dumped imports from countries not members of 
the European Community, as last amended by Council Regulation (EC) No 461/2004 
of  8  March  2004  ("the  basic  Regulation")  in  the  proceedings  concerning  imports  of 
styrene-butadiene-styrene  thermoplastic  rubber  originating  in  the  Republic  of  Korea 
and  Russia  and  imports  of  styrene-butadiene-styrene  thermoplastic  rubber  originating 
in Taiwan  

120 

•  General context 

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

130 

•  Existing provisions in the area of the proposal 

Council  Regulation  (EC)  No  1993/2000  of  18.9.2000  imposing  a  definitive  anti-
dumping  duty  and  definitively  collecting  the  provisional  duty  imposed  on  imports  of 
styrene-butadiene-styrene 
Taiwan. 
Proposal for repealing these measures by Council Regulation 

thermoplastic 

originating 

rubber 

in 

141 

219 

229 

230 

•  Consistency with the other policies and objectives of the Union 

Not applicable. 

2)  CONSULTATION OF INTERESTED PARTIES AND IMPACT ASSESSMENT 

•  Consultation of interested parties 

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

•  Collection and use of expertise 

There was no need for external expertise. 

•  Impact assessment 

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

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

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3)  LEGAL ELEMENTS OF THE PROPOSAL 

305 

•  Summary of the proposed action 

On 28 May 2004, the Commission opened an anti-dumping investigation with regard to 
imports  into  the  Community  of  styrene-butadiene-styrene  thermoplastic  rubber 
originating in the Republic of Korea and Russia. 

On the same day, an interim review of the definitive anti-dumping duties imposed by 
Council Regulation (EC) No 1993/2000 on imports of SBS originating in Taiwan was 
initiated. 

With  regard  to  dumping,  a  dumping  margin  of  31.7%  was  found  for  the  Russian 
exporting producer and a de minimis dumping margin for the only exporting producer 
in Korea. As regards the review on Taiwan, a dumping margin of 16.2% was found for 
one exporting producer and a de minimis dumping margin for the other one. 

It was found that the situation of the Community industry deteriorated, mainly in terms 
of volumes of sales and profitability. However, the causal link between the impact of 
the  dumped  imports  and  the  deterioration  of the situation of the Community industry 
could not be established.  

It is therefore proposed that the Council adopt the attached proposal for a Regulation 
terminating  the  proceeding  with  regard  to  the  Republic  of  Korea  and  Russia  and 
repealing  the  measures  in  force  on  imports  from  Taiwan.  This  Regulation  should  be 
published in the Official Journal no later than 27 August 2005. 

310 

•  Legal basis 

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

329 

•  Subsidiarity principle 

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

•  Proportionality principle 

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

331 

332 

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 

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341 

342 

409 

520 

Proposed instruments: regulation. 

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

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

4)  BUDGETARY IMPLICATION 

The proposal has no implication for the Community budget. 

5)  ADDITIONAL INFORMATION 

•  Repeal of existing legislation 

The adoption of the proposal will lead to the repeal of existing legislation. 

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Proposal for a 

COUNCIL REGULATION 

terminating the anti-dumping proceeding concerning imports of styrene-butadiene-
styrene thermoplastic rubber originating in the Republic of Korea and Russia, 
terminating the interim review of the anti-dumping measures applicable to imports of 
styrene-butadiene-styrene thermoplastic rubber originating in Taiwan and repealing 
these measures 

THE COUNCIL OF THE EUROPEAN UNION, 

Having regard to the Treaty establishing the European Community,  

Having  regard  to  Council  Regulation  (EC)  No  384/96  of  22  December  1995  on  protection 
against dumped imports from countries not members of the European Community1 (‘the basic 
Regulation’), and in particular Article 9 thereof, 

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

Whereas: 

1. Measures in force 

A. PROCEDURE 

(1) 

In  September  2000,  by  Regulations  (EC)  No  1994/20002  and  No  1993/20003,  the 
Council  imposed  definitive  countervailing  duties  ranging  from  1 %  to  8,2 %  and 
definitive  anti-dumping  duties  on  imports  of  styrene-butadiene-styrene  thermoplastic 
rubber (‘SBS’) originating in Taiwan.  

(2) 

The level of definitive anti-dumping duties established for the exporting producers in 
Taiwan, expressed as a percentage of the CIF frontier value, was as follows: 

–  Lee Chang Yung Chemical Industry Corp., Taipei 

5,3 % 

–  Chi Mei Corp., Tainan 

–  Non cooperating exporting producers 

9,1 % 

20,0 % 

1  

2 
3 

OJ  L  56,  6.3.1996,  p.  1.  Regulation  as  last  amended  by  Regulation  (EC)  No  461/2004  (OJ  L  77, 
13.3.2004, p. 12). 
OJ L 238, 22.9.2000, p. 8. 
OJ L 238, 22.9.2000, p. 4. 

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2. Present investigations  

(3) 

(4) 

(5) 

On 28 May 2004, pursuant to Article 5 of Council Regulation (EC) No 384/96 of 22 
December 1995 on protection against dumped imports from countries not members of 
the  European  Community4,  the  Commission  announced  by  a  notice  (‘notice  of 
initiation’) published in the Official Journal of the European Union5, the initiation of 
an  anti-dumping  proceeding  with  regard  to  imports  into  the  Community  of  SBS 
originating in the Republic of Korea (‘Korea’) and Russia. 

On  the  same  day,  the  Commission  announced  by  a  notice  published  in  the  Official 
Journal of the European Union6, the initiation of an interim review, pursuant to Article 
11(3)  of  the  basic  Regulation,  of  the  definitive  anti-dumping  duties  imposed  by 
Council Regulation (EC) No 1993/2000 on imports of SBS originating in Taiwan. 

The  anti-dumping  investigation  was  initiated  following  a  complaint  lodged  on  13 
April  2004  by 
the  European  Chemical  Industry  Council  (‘CEFIC’  or  ‘the 
complainant’)  on  behalf  of  producers  representing  100 %  of  the  Community 
production of SBS. The complaint contained evidence of dumping of the said product 
and of material injury resulting there from, which was considered sufficient to justify 
the initiation of a proceeding. 

(6) 

The interim review was based on a request lodged by CEFIC and contained evidence 
that  dumping  and  injury  had  recurred  and  that  the  existing  measures  were  no  longer 
sufficient to counteract the injurious dumping. 

3. Parties concerned by the proceeding 

(7) 

(8) 

(9) 

The  Commission’s  services  officially  advised  the  exporting  producers  in  Korea, 
Russia  and  Taiwan,  importers/traders  and  their  associations,  suppliers  and  users 
known to be concerned, the representatives of the exporting countries concerned, and 
the complainant Community producers of the initiation of the proceedings. Interested 
parties were given the opportunity to make their views known in writing and to request 
a hearing within the time limit set in the notices of initiation. 

In view of the large number of importers of SBS into the EC listed in the complaint 
and the request, the notices of initiation envisaged the use of sampling for importers 
for the determination of injury, in accordance with Article 17 of the basic Regulation. 

In  order  to  enable  the  Commission’s  services  to  decide  whether  sampling  would  be 
necessary and, if so, to select a sample, all importers were asked to make themselves 
known to the Commission and to provide, as specified in the notices of initiation, basic 
information on their activities related to SBS during the sampling period (1 April 2003 
to 31 March 2004). After examination of the information submitted by the importers 
and due to the small number of replies to the sampling questions, it was decided that 
sampling was not necessary. 

4 

5 
6 

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 144, 28.5.2004, p. 5. 
OJ C 144, 28.5.2004, p. 9. 

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(10)  Questionnaires  were  sent  to  all  parties  known  to  be  concerned  and  to  all  other 
companies that made themselves known within the deadlines set out in the notices of 
initiation. 

(11)  Replies  were  received  from  one  Korean  exporting  producer,  one  Russian  producer, 
together  with  its  two  related  Russian  companies,  four  Taiwanese  producers,  four 
Community  producers  and  four  unrelated  importers.  No  replies  were  received  from 
users. 

(12)  The Commission’s services sought and verified all the information deemed necessary 
for  the  purpose  of  a  determination  of  dumping,  resulting  injury  and  Community 
interest.  In  accordance  with  Article  16(1)  of  the  basic  Regulation,  verification  visits 
were carried out at the premises of the following companies: 

(a) 

Community industry producers 

–  Dynasol Elastomeros S.A., Madrid, Spain 

–  Kraton Polymers International Ltd., London, United Kingdom 

–  Polimeri Europa S.p.A., Milan, Italy 

–  SA Petrofina NV Brussels, Belgium (formerly Atofina Elastomers N.V.) 

(b) 

Exporting producer in Korea 

–  Korea Kumho Petrochemicals Co., Ltd., Seoul 

(c) 

Exporting producer in Russia 

–  SIBUR group: 

–  Public  Joint  Stock  Company  “Sibirsko-Uralskaya  Neftegazohimicheskaya 

Companiya” (‘SIBUR’), Moscow 

–  Gazexport, Limited Liability Company, Moscow 

–  Joint Stock Company Voronezhsyntezkauchuk, Voronezh 

(13)  The 

that 

only 

showed 

investigation 

JSC 
Voronezhsyntezkauchuk,  produced  the  product  concerned,  while  JSC  SIBUR  was 
mainly responsible for the domestic sales and the delivery of raw materials. Gazexport 
was responsible for the export sales during most of the investigation period. Thus, for 
the  purposes  of  this  investigation,  the  three  related  Russian  companies  will  be 
considered as one company, namely the ‘SIBUR group’.  

one  Russian 

company, 

(d) 

Exporting producers in Taiwan 

–  Chi Mei Corp., Tainan 

–  Lee Chang Yung Chemical Industry Corp., Taipei 

(e) 

Unrelated importers 

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–  Guzman Cauchos S.L., Valencia, Spain 

–  Monumenta Import Export GmbH, Troisdorf, Germany 

–  Tecnopolimeri S.p.A., Seregno, Italy 

4. Provisional measures 

(14)  Given the need to further examine certain aspects of injury, causality and Community 
interest, in particular in view of the interrelation with the parallel interim review of the 
anti-dumping  duties  applicable  to  imports  of  SBS  originating  in  Taiwan,  no 
provisional  anti-dumping  measures  were  imposed  on  imports  of  SBS  originating  in 
Korea and Russia. All parties were nevertheless informed of the preliminary findings 
of  the  investigation  and  were  granted  a  period  within  which  they  could  submit 
representations  subsequent  to  the  disclosure  and  the  oral  and  written  comments 
submitted by the parties were taken into consideration. 

5. Subsequent procedure 

(15)  The  Commission’s  services  continued  to  seek  and  verify  all  information  deemed 
necessary  for  definitive  findings,  in  particular  with  regard  to  imports  of  SBS  from 
Taiwan. 

(16)  Subsequently, all parties were informed about the essential facts and considerations on 

the basis of which it was intended to recommend: 

–  the termination of the proceeding against imports of SBS originating in Korea and 

Russia; and 

–  the  repeal  of  Council  Regulation  (EC)  No  1993/2000  imposing  definitive  anti-

dumping duties on imports of SBS originating in Taiwan. 

(17)  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 considered, and where appropriate, the findings have been modified accordingly. 

6. Investigation period 

(18)  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 in the context 
of  the  injury  analysis  covered  the  period  from  1  January  2000  to  the  end  of  the  IP 
(‘period considered’). 

B. PRODUCT CONCERNED AND LIKE PRODUCT 

1. Product concerned  

(19)  The  product  concerned  is  styrene-butadiene-styrene  thermoplastic  rubber,  currently 
classifiable within CN codes ex 4002 19 00, ex 4002 99 10 and ex 4002 99 90. 

(20)  SBS is a triblock copolymer mainly made from monomer styrene and butadiene. It can 
be  either  dry  or,  with  the  addition  of  oil  at  the  manufacturing  stage,  oil-extended. 

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Furthermore,  it  can  be  produced  in  different  types  which  can  be  identified  through 
different specifications, such as the ratio of styrene to butadiene, the oil content or the 
chemical symmetry. Although the potential range of types of SBS is considerable, they 
share the same basic physical characteristics and no clear dividing lines exist between 
the various types. Moreover, all types of SBS are used for the same purposes, such as 
the  thermo-modification  of  bitumen  for  road  asphalt  and  roofing  membranes,  for 
technical and footwear compounding, plastic modification, and adhesives. Therefore, 
they are considered as one single product for the purpose of this investigation. 

(21)  During  the  verification  visits  it  was  found  that  one  company  exported  styrene-
isoprene-styrene  block  polymer  (‘SIS’)  to  the  Community  during  the  IP.  It  was 
considered that this product cannot be regarded as the product concerned. Indeed, SIS 
has a different physical composition to SBS as the monomer in the mid-block of the 
polymer is isoprene instead of butadiene. It therefore did not share the same physical 
characteristics and is consequently not covered by the present proceeding. 

2. Like product 

(22)  The  product  concerned  and  the  SBS  manufactured  and  sold  domestically  in  Korea, 
Russia and Taiwan, as well as the SBS manufactured and sold in the Community by 
the  Community  industry  were  found  to  have  the  same  basic  physical  and  chemical 
characteristics and the same basic uses. Therefore, these products are considered to be 
alike within the meaning of Article 1(4) of the basic Regulation. 

1. General methodology  

C. DUMPING 

(23)  The  general  methodology  set  out  below  was  applied  to  all  exporting  producers  in 
Korea,  Russia  and  Taiwan.  The  subsequent  presentation  of  findings  on  dumping  for 
the  countries  concerned  therefore  only  describes  issues  specific  to  each  exporting 
country. 

2. Normal value 

(24) 

In  accordance  with  Article  2(2)  of  the  basic  Regulation,  the  Commission’s  services 
first examined for each cooperating exporting producer whether its total domestic sales 
of SBS were representative, i.e. whether the total volume of such sales represented at 
least  5 %  of  the  total  export  sales  volume  of  the  producer  to  the  Community.  The 
Commission’s  services  subsequently  identified  those  types  of  SBS  sold  on  the 
domestic  market  by  the  companies  having  overall  representative  domestic  sales  and 
that  were  identical  to  or  directly  comparable  with  the  types  sold  for  export  to  the 
Community.  

(25)  For each type sold by the exporting producers on their domestic markets and found to 
be directly comparable with the types of SBS sold for export to the Community, it was 
established whether domestic sales were sufficiently representative for the purposes of 
Article 2(2) of the basic Regulation. Domestic sales of a particular type of SBS were 
considered  sufficiently  representative  when  the  total  domestic  sales  volume  of  that 
type during the IP represented 5 % or more of the total sales volume of the comparable 
type of SBS exported to the Community.  

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

(27) 

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

(28)  Consequently,  in  accordance  with Article 2(3) of the basic Regulation, normal value 
was constructed by adding to the manufacturing costs of the exported types, adjusted 
where necessary, a reasonable amount for selling, general and administrative expenses 
(SG&A)  and  a  reasonable  margin  of  profit.  To  this  end,  the  Commission  examined 
whether the SG&A incurred and the profit realised by each of the exporting producers 
concerned on the domestic market constituted reliable data. 

(29)  Actual  domestic  SG&A  expenses  were  considered  reliable  when  the  total  domestic 
sales  volume  of  the  company  concerned  could  be  regarded  as  representative  when 
compared to the volume of export sales to the Community. The domestic profit margin 
was determined on the basis of domestic sales of those types which were sold in the 
ordinary  course  of  trade.  For  this  purpose,  the  methodology  as  set  out  above  was 
applied. 

3. Export price 

(30) 

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

4. Comparison 

(31)  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  price 

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comparability  in  accordance  with  Article  2(10)  of  the  basic  Regulation.  Appropriate 
adjustments  were  granted  in  all  cases  where  they  were  found  to  be  reasonable, 
accurate and supported by verified evidence. 

5. Dumping margin 

(32)  According  to  Article  2(11)  of  the  basic  Regulation,  for  each  exporting  producer  the 
weighted average normal value was compared with the weighted average export price. 

6. Korea 

(33)  A  questionnaire  reply  was  received  from  one  Korean  exporting  producer.  The 
investigation  showed  that  the  total  domestic  sales  of  the  Korean  company  were 
representative. Furthermore, the total domestic sales volume of each type of SBS sold 
by the company represented 5 % or more of the total sales volume of comparable types 
of  SBS  exported  to  the  Community  and  could  therefore  be  considered  as 
representative. 

6.1. Normal value 

(34)  To determine the normal value, domestic prices could be used for two product types. 
For  three  product  types,  normal  value  was  based  on  profitable  sales  only.  For  five 
product  types,  less  than  10 %  of  the  domestic  sales  were  profitable  during  the  IP. 
Therefore, in these cases, the Commission constructed the normal value in accordance 
with Article 2(3) of the basic Regulation on the basis of the exporting producer’s own 
cost of manufacturing plus a reasonable amount for selling, general and administrative 
(‘SG&A’) costs and for profit. In this regard, SG&A costs were based on the SG&A 
costs of the company as its domestic sales of the like product were representative as 
defined  in  Article  2(2)  of  the  basic  Regulation.  For  the  profit  margin,  in  accordance 
with the first sentence of Article 2(6) of the basic Regulation, the profit on domestic 
sales in the ordinary course of trade was used. 

6.2. Export price 

(35)  As exports of the product concerned were made directly to independent customers in 
the Community, the export prices were established on the basis of the prices paid or 
payable  for  the  product  concerned  when  sold  for  export  to  the  Community  in 
accordance with Article 2(8) of the basic Regulation. 

6.3. Comparison 

(36)  Adjustments  were  made  in  respect  of  transport,  insurance,  handling  and  credit  costs 
where  applicable  and  justified.  In  accordance  with  Article  2(10)(b)  of  the  basic 
Regulation, the company claimed and was granted a duty drawback adjustment on the 
normal value on the grounds that import charges were borne by the like product when 
consumed in the exporting country but were refunded when SBS was sold for export. 

(37)  The  company  also  claimed  an  adjustment  for  quantity  discounts.  During  the 
verification  visit,  the  company  had  the  opportunity  to  demonstrate  that  quantity 
discounts affected prices. However, they were unable to properly quantify the alleged 
discounts  and  to  demonstrate  that  they  were  directly  linked  to  the  sales  under 

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consideration. Therefore, in accordance with Article 2(10) of the basic Regulation, the 
claim was rejected. 

6.4. Dumping margin 

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

the Community frontier duty unpaid is the following: 

–  Korea Kumho Petrochemicals Co., Ltd., Seoul: 0,95 % 

(39)  Since  the  dumping  margin  for  Korea  Kumho  Petrochemicals  is  de  minimis,  i.e.  less 
than 2 %, the proceeding against Korea should be terminated without the imposition of 
measures in accordance with Article 9(3) of the basic Regulation. 

7. Russia 

(40)  Questionnaire replies were received from three related companies and were considered 

together. 

7.1. Normal value 

(41)  The investigation showed that all Russian domestic sales were representative and that 
only  one  specific  product  type  was  sold  to  the  EU.  It  was  found  that  there  were 
sufficient  domestic  sales  of  the  relevant  type  of  SBS  and  that  these  sales  could  be 
considered  as  representative.  Moreover,  the  product  type  exported  to  the  EC  was 
found  to  be  sold  in  the  ordinary  course  of  trade.  Therefore,  actual  domestic  prices 
could be used to determine the normal value. 

(42)  One of the companies of the SIBUR group produced the main raw materials, butadiene 
and styrene, on its own and only purchased these materials in the event of a shortage. 
As  conflicting  information  about  the  quantity  of  certain  raw  materials  purchased  in 
relation  to  the  quantity  of  raw  materials  produced  in  the  IP  were  reported,  in 
accordance with the provisions of Article 2(5) and Article 18 of the basic Regulation, 
the  Commission’s  services  used  facts  available,  in  this  case  the  highest  quantity  of 
purchased  raw  material  reported  by  the  companies,  to  establish  the  cost  of  raw 
materials  for  the  determination  of  the  cost  of  production.  However,  the  total  revised 
cost of production did not alter the finding that domestic prices were the appropriate 
basis for establishing the normal value. 

(43)  Considering  the  division  of  tasks  between  the  companies  concerned,  the  cost  of 
production  had to  be determined by summing  up  the  relevant  costs  of  the  producing 
company, JSC Voronezhsyntezkauchuk, with the relevant costs of JSC SIBUR. 

(44)  After  the  companies  were  informed  of  the  decision  not  to  impose  provisional 
measures,  they  claimed  a  correction  of  the  established  normal  value  on  the  grounds 
that they had reported their domestic sales prices including Russian VAT by mistake. 
During the verification visit, the domestic sales prices for one company were verified 
and found to be reported net, free of taxes. With regard to the second company selling 
on the domestic market, domestic sales prices could not be properly verified during the 
verification  visit  as  the  company  was  unable  to  completely  list  their  transactions  of 
domestic sales at that time. However, the complete domestic prices reported later on 
the 
were  verified  by  randomly  chosen 

invoices.  Based  on 

invoices, 

these 

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12 

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Commission’s  services  came  to  the  conclusion  that  the  company  had  reported  their 
relevant domestic sales prices net, free of taxes. For the remaining domestic sales, the 
Commission’s services were unable to carry out any further verification with regard to 
VAT in due time. In the light of the foregoing, the claim was rejected. 

7.2. Export price 

(45)  As exports of the product concerned were made directly to independent customers in 
the  Community,  the  export  price  was  established  on  the  basis  of  the  prices  paid  or 
payable  for  the  product  concerned  when  sold  for  export  to  the  Community  in 
accordance with Article 2(8) of the basic Regulation. 

7.3. Comparison 

(46)  As all sales were made ex-works, adjustments were only made in respect of handling 

and credit costs where applicable and justified.  

(47)  After  the  companies  were  informed  of  the  decision  not  to  impose  provisional 
measures,  they  claimed  an  adjustment  for  differences  in  physical  characteristics 
according to Article 2(10)(a) of the basic Regulation stating that the SBS produced by 
them was of a lower quality compared to the product manufactured by the Community 
industry.  During  the  verification  visit,  it  was  verified  and  confirmed  that  the  SBS 
produced and sold on the Russian domestic market was the same as the SBS sold to 
the  EC.  Therefore,  the  claim  was  rejected  under  Article  2(10)(a)  of  the  basic 
Regulation. 

7.4. Dumping margins 

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

the Community frontier duty unpaid is the following: 

–  SIBUR group, Russia: 31,7 % 

8. Taiwan 

(49)  Questionnaire  replies  were  received  from  four  producers  of  SBS  in  Taiwan.  The 
replies  showed  that  only  those  two  companies  subject  to  individual  dumping  duties 
exported the product concerned to the EC during the IP. 

8.1. Normal value 

(50)  For one company, the investigation showed that all domestic sales were representative 
and  that  only  one  specific  product  type  was  sold  to  the  EU.  It  was  found  that  there 
were sufficient domestic sales of the relevant type of SBS and that these sales could be 
considered  as  representative.  Moreover,  the  product  type  exported  to  the  EC  was 
found  to  be  sold  in  the  ordinary  course  of  trade.  Therefore,  actual  domestic  prices 
could be used to determine the normal value. 

(51)  For the other co-operating company, the investigation showed that total domestic sales 
were  representative.  Furthermore,  the  total  domestic  sales  volume  of  eight  types  of 
SBS  sold  by  the  company  represented  5 %  or  more  of  the  total  sales  volume  of 
comparable  types  of  SBS  exported  to  the  Community  and  could  therefore  be 

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considered as representative. However, one type of SBS sold to the EC was not sold 
on the domestic market. 

(52)  To determine the normal value, domestic prices could be used for eight product types. 
For the product type for which no domestic sales could be found, the Commission’s 
services  constructed  the  normal  value  in  accordance  with  Article  2(3)  of  the  basic 
Regulation on the basis of the exporting producer’s own cost of manufacturing plus a 
reasonable  amount  for  selling,  general  and  administrative  (‘SG&A’)  costs  and  for 
profit. In this regard, SG&A costs were based on the SG&A costs of this company for 
those  domestic  sales  of  the  like  product  which  were  representative  as  defined  in 
Article  2(2)  of  the  basic  Regulation.  For  the  profit  margin,  in  accordance  with  the 
Article 2(6) of the basic Regulation, the profit on domestic sales in the ordinary course 
of trade was used. 

8.2. Export price 

(53)  As exports of the product concerned were made directly to independent customers in 
the Community, the export prices were established on the basis of the prices paid or 
payable  for  the  product  concerned  when  sold  for  export  to  the  Community  in 
accordance with Article 2(8) of the basic Regulation. 

8.3. Comparison 

(54)  For one company, adjustments were made in respect of transport, insurance, handling, 

credit and commission where applicable and justified.  

(55)  The  company  then  claimed  an  adjustment  for  after-sales  costs  pursuant  to 
Article 2(10)(h) of  the basic Regulation,  stating that a special after-sales service was 
only offered for sales on the domestic market. The company was given the opportunity 
during the verification visit to substantiate this claim, but could not demonstrate that 
any after-sales services were provided. The claim was therefore rejected in accordance 
with Article 2(10) of the basic Regulation. 

(56)  Furthermore, the company claimed an adjustment for currency conversions according 
to  Article  2(10)(j)  of  the  basic  Regulation.  The  claim  was  based  on  the  fact  that  the 
company  kept  the  sales  amount  for  some  export  sales  in  the  invoiced  currency  and 
only  exchanged  it  when  the  rate  was  favourable.  However,  since  the  exchange  rate 
used in the accounting system was equal to the daily rate of the individual export sale, 
and therefore reflected the  sales amount in the domestic currency, no adjustment  for 
speculative  currency  gains  could  be  granted.  The  company  did  not  demonstrate  that 
the conditions of Article 2(10)(j) of the basic Regulation were fulfilled and therefore 
the claim was rejected.  

(57)  For  the  other  company,  adjustments  were  made  in  respect  of  transport,  insurance, 

handling, loading, packing and credit costs where applicable and justified.  

(58)  This  company  also  claimed  an  adjustment  for  differences  in  physical  characteristics 
according to Article 2(10)(a) of the basic Regulation, on the grounds that some sales to 
the  EC  of  a  lower  quality  type  of  the  product  concerned  had  no  equivalent  on  the 
domestic  market.  During  the  verification  visit,  the  company  had  the  opportunity  to 
demonstrate that the alleged differences in physical characteristics affected prices and 

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price  comparability.  However,  they  were  unable  to  demonstrate  that  the  alleged 
physical differences had a consistent impact on the price or on the use of the product 
concerned in comparison to the relevant type  of SBS of a higher quality  sold on  the 
domestic market. Therefore, the claim was rejected. 

8.4. Dumping margins 

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

the Community frontier duty unpaid are the following: 

–  Lee Chang Yung Chemical Industry Corp., Taipei: -1,8 % 

–  Chi Mei Corp., Tainan: 16,2 % 

D. INJURY 

1. Definition of the Community industry 

(60)  The following Community producers supported the complaint: 

–  Dynasol Elastomeros S.A., Madrid, Spain;  

–  Kraton Polymers International Ltd., London, United Kingdom; 

–  Polimeri Europa S.p.A., Milan, Italy; 

–  SA Petrofina NV Brussels, Belgium (formerly Atofina Elastomers N.V.); 

(61)  As these four complainant co-operating Community producers represent 100 % of the 
Community production of the product concerned, it is considered that the complainant 
producers constitute the Community industry within the meaning of Articles 4(1) and 
5(4) of the basic Regulation. 

2. Community consumption 

(62)  Community  consumption  was  established  on  the  basis  of  the  sales  volumes  of  the 
Community industry on the Community market, plus all imports from Korea, Russia 
and Taiwan, plus an estimated proportion of imports of SBS from other third countries 
under  the  relevant  CN  codes,  as  SBS  only  represents  a  part  of  these  customs  codes. 
This  proportion  was  based  on  the  methodology  followed  in  the  complaint  in  the 
absence  of  any  other  source  of  information.  The  imports  from  Korea,  Russia  and 
Taiwan  were  determined  on  the  basis  of  the  figures  submitted  by  the  co-operating 
exporting  producers  in  these  three  countries,  since  it  was  established  during  the 
investigation that they represented 100 % of the exports of the product concerned from 
Community. 
the 

concerned 

countries 

the 

to 

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(63)  Between 2000 and the IP Community consumption decreased from 193 756 tonnes to 
180 195 tonnes, i.e. by 7 %. However, the Community consumption reached a peak in 
2002 and then sharply decreased by 9 %. 

2000 

2001 

2002 

2003 

IP 

Community consumption 
(tonnes) 

193 756 

191 827 

198 741 

188 562 

180 195 

Index 

100 

99 

103 

97 

93 

3. Imports of SBS from the countries concerned 

3.1. Cumulation  

(64)  The  Commission  considered  whether  the  effects  of  imports  of  SBS  originating  in 
Korea, Russia and Taiwan should be assessed cumulatively in accordance with Article 
3(4) of the basic Regulation. 

(65)  This  Article  provides  that  the  effects  of  imports  from  two  or  more  countries 
simultaneously subject to anti-dumping investigations shall be assessed cumulatively 
only  if  it  is  determined  that  (a)  the  margin  of  dumping  established  in  relation  to  the 
imports  from  each  country  is  more  than  de  minimis  as  defined  in  Article  9(3)  of  the 
basic Regulation and that the volume of imports of each country is not negligible and 
(b) a cumulative assessment of the effects of the imports is appropriate in the light of 
the  conditions  of  competition  between  imported  products  and  the  conditions  of 
competition between the imported products and the like Community product. 

(66)  With  regard  to  Korea  and  one  Taiwanese  exporting  producer,  the  investigation  has 
shown that either de minimis or no dumping was found. Therefore, in accordance with 
Article  3(4)  of  the  basic  Regulation,  those  imports  concerned  could  not  be 
cumulatively  assessed.  On  the  contrary,  as  indicated  above,  the  dumping  margins 
established for Russia and the other cooperating Taiwanese exporter are well above de 
minimis level, and the volume of imports from said countries is not negligible in the 
sense  of  Article  5(7)  of  the  basic  Regulation,  the  cumulated  market  share  attaining 
5,3 %. 

(67) 

In  order  to  determine  the  appropriateness  of  a  cumulative  assessment  in  view  of  the 
conditions  of  competition  between  imported  products  from  the  two  companies  and 
between  imported  products  and  the  like  Community  product,  the  Commission’s 
services analysed the exporters’ market behaviour in terms of trends of export volumes 
and prices. 

(68)  Similar  trends  in  export  volumes  were  identified  for  Taiwan  and  Russia,  with  an 
increase of 77 % for Russia and 151 % for Taiwan between 2001, the year following 
the imposition of measures on Taiwan, and the IP. Given the above, it was concluded 
that  there  was  no  significant  difference  in  the  market  behaviour  of  the  Russian  and 
Taiwanese  exporters  found  to  dump  in  terms  of  trends  of  export  volumes  to  the 
Community. 

(69)  Similar market behaviour on the part of Russian and Taiwanese producers in terms of 
export  prices  was  also  found.  In  fact,  these  countries  decreased  their  respective 

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average unit selling prices of SBS by 18 % and 6 % from 2001, after measures were 
imposed  on  Taiwanese  imports  and  import  volumes  from  Russia  started  to  become 
significant,  until  the  end  of  the  IP.  In  addition,  a  similar  level  of  undercutting  was 
determined for imports from both countries. 

(70)  The  investigation  also  showed  that  imports  from  the  countries  concerned  into  the 
Community  used  the  same  sales  channels,  as  in  the  vast  majority,  said  imports  are 
traded through distributors, rather than sold to final customers. 

(71)  Furthermore,  as  explained  above,  it  was  found  that  the  product  concerned  imported 
from the countries concerned and produced by the Community industry share the same 
basic physical and chemical characteristics, and are to be considered alike in terms of 
interchangeability  and  substitutability.  Thus,  it  was  established  that  exports  of  the 
product  concerned  from  the  countries  concerned  compete  with  each  other  and  with 
SBS manufactured by the Community industry.  

(72)  On  the  basis  of  the  above,  it  was  concluded  that  all  conditions  justifying  the 

cumulation of imports of SBS originating in Russia and Taiwan were met.  

3.2. Import volume and market share 

(73)  Dumped imports of SBS from Russia and Taiwan increased sharply from 2 834 tonnes 
in 2000 to 9 523 tonnes during the IP. The corresponding market share increased from 
1,5 % in 2000 to 5,3 % during the IP.  

2000 

2 834 

100 

2001 

4 979 

176 

2002 

4 966 

175 

2003 

8 919 

315 

IP 

9 523 

336 

1,5 % 

2,6 % 

2,5 % 

4,7 % 

5,3 % 

Imports (tonnes) 

Index 

Market share 

3.3. Prices 

(74)  The  weighted  average  price  of  dumped  imports  of  SBS  originating  in  Russia  and 

Taiwan declined by 12 % between 2000 and the IP.  

2000 

1 145 

2001 

1 179 

2002 

1 086 

2003 

1 023 

IP 

1 004 

average  CIF 
Weighted 
Community  frontier  price 
(EUR/tonne)  

Index 

100 

103 

95 

89 

88 

3.4. Undercutting 

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

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Community  frontier  with  an  appropriate  adjustment  for  the  customs  clearance  costs 
and post-importation costs.  

(76) 

It  was  claimed  by  importers  and  the  Russian  producer  and  also  confirmed  by  the 
Community  industry  that  the  quality  of  the  like  product  manufactured  by  the 
Community industry is generally higher than that of the product concerned imported 
from  Russia.  Based  on  the  evidence  found,  it  was  considered  that  this  quality 
difference  justified  an  estimated  adjustment  of  5 %,  which  was  added  to  the  CIF 
Community frontier price of the co-operating exporting producers. 

(77)  During the IP, the weighted average undercutting margin was around 15 % for Russia 

and for the Taiwanese producer found to dump. 

(78)  When assessing the above figures, it should be borne in mind that – despite the quality 
adjustment  made  –  SBS  from  various  sources  is  largely  interchangeable  and, 
consequently,  price  is  an  important  criteria  for  selecting  a  source  of  supply.  This 
reinforces the effect of any price undercutting found. 

4. Situation of the Community industry 

4.1. Production 

(79)  Production in volume by the Community industry decreased by 4 % during the period 
considered. After an increase in 2002, the production decreased in 2003 and during the 
IP.  

Production 
(tonnes) 

Index 

2000 

2001 

2002 

2003 

IP 

259 698 

253 113 

271 964 

253 679 

249 566 

100 

97 

105 

98 

96 

4.2. Capacity of production and capacity utilisation rates 

(80)  The  production  capacity  was  established  on  the  basis  of  the  nominal  capacity  of  the 
production  units  owned  by  the  Community  industry,  taking  into  account  technical 
interruptions in production as well as the fact that in certain cases part of the capacity 
had been used for other products manufactured with the same production lines. 

(81)  SBS production capacity remained stable during the period considered. Indeed, after a 
slight increase in 2001 and 2002, it decreased in 2003 to the same level as in 2000 and 
remained at that level in the IP. 

(82)  Capacity  utilisation  rates  diminished  by  4  percentage  points  from  79 %  to  75 %.  As 
production capacity itself remained stable, this decline in capacity utilisation is merely 
due  to  the  decrease  in  the  production  volumes  of  the  Community  industry. 

EN 

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2000 

2001 

2002 

2003 

IP 

329 574 

337 524 

338 014 

329 173 

330 774 

100 

79 % 

102 

75 % 

103 

80 % 

100 

77 % 

100 

75 % 

Capacity of production 
(tonnes) 

Index 

Capacity utilisation 

4.3. Stocks 

(83)  During the period considered stocks increased by 60 %. The stock increase seems to 
have two reasons, one being the decrease in sales and the other being a variety of new 
types of SBS produced which needed more time to be marketable.  

2000 

2001 

2002 

2003 

IP 

Stocks (tonnes) 

44 971 

44 325 

59 077 

63 997 

71 875 

Index 

100 

99 

131 

142 

160 

4.4. Investments 

(84) 

In  the  period  considered  the  Community  industry  invested  around  EUR 60 million, 
mainly  consisting  of  plant  and  machinery  (around  48 %)  and  research  and 
development  projects  (23 %).  These  investments  were  necessary  mainly  to  maintain 
production capacity at its current level. After a sharp decrease in the years 2001 and 
2002, investments increased again in 2003 and the IP, but still remained below that of 
the  year  2000.  The  increase  in  2003  and  the  IP  was  due  to  maintenance  and 
modernisation  required  for  the  development  and  introduction  of  new  types  of  SBS, 
which  was  necessary  for  the  Community  industry  in  order  to  remain  competitive. 
Furthermore, the fluctuation of investments can be explained by the cyclical lifespan 
of  certain  machinery.  Over  the  period  considered  the  annual  investments  decreased 
overall by 11 %.  

2000 

2001 

16 464 

12 969 

2002 

8 914 

2003 

IP 

11 760 

14 698 

Investments  
(EUR ‘000) 

Index 

100 

79 

54 

71 

89 

4.5. Sales and market share 

(85)  SBS  sales  by  the  Community  industry  on  the  Community  market  declined  by  15 % 
from  2000 to  the IP. As Community  consumption only decreased by 7 % during  the 
period considered, the sharp decrease in sales by the Community industry resulted in a 
significant loss of market share, which indeed passed from 89 % to 82 %.  

2000 

2001 

2002 

2003 

IP 

Sales  in  the  EC 
(tonnes) 

172 080 

166 680 

161 486 

155 050 

146 907 

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Index 

Market share 

4.6. Prices 

100 

89 % 

97 

87 % 

94 

81 % 

90 

82 % 

85 

82 % 

(86)  The  Community  industry’s  average  unit  selling  price  was  more  or  less  at  the  same 
level during the IP compared to 2000, decreasing by only 1 %. Indeed the Community 
industry’s  unit  selling  price  first  increased  by  6 %  between  2000  and  2001  and 
subsequently decreased by 7 % from 2001 to the IP.  

2000 

1 350 

2001 

1 434 

2002 

1 363 

2003 

1 348 

IP 

1 330 

Weighted  average 
price (EUR/tonne) 

Index 

100 

106 

101 

100 

99 

4.7. Profitability and cash flow 

(87)  During the period considered the weighted average profitability on net turnover of the 
Community  industry  for  its  sales  of  the  like  product  on  the  Community  market 
decreased from 2,2 % to 1,2 %. It first sharply increased from 2,2 % in 2000 to 9,3 % 
in  2001  which  coincided  with  the  imposition  of  anti-dumping  and  countervailing 
measures on imports of SBS from Taiwan and subsequently constantly decreased from 
2001 onwards.  

2000 

2001 

2002 

2003 

IP 

Weighted  average 
profitability  on  net 
turnover  

2,2 % 

9,3 % 

8,9 % 

1,5 % 

1,2 % 

(88)  The  cash  flow  generated  was  EUR -0,7  million  during  the  IP.  The  situation  was 
difficult  in  2000  mainly  because  of  the  high  level  of  investments.  However  the 
Community  industry  could  generate  positive  cash  flow  for  the  years  2001,  2002  and 
2003. However, the cash flow situation deteriorated sharply from 2002 to the IP. 

2000 

2001 

2002 

2003 

IP 

Cash flow (in EUR 
‘000)  

-7 362 

10 005 

33 050 

4 639 

-714 

4.8. Return on net assets  

(89)  Return  on  net  assets  for  the  product  concerned  decreased  by  5 %  during  the  period 
considered.  After  a  first  increase  to  0,3 %  in  2001  and  2,8 %  in  2002,  it  sharply 
decreased to -8,5 % in 2003 and -11,2 % in the IP. 

2000 

2001 

2002 

2003 

IP 

Weighted 
on net assets 

return 

-6,2 % 

0,3 % 

2,8 % 

-8,5 % 

-11,2 % 

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4.9. Ability to raise capital 

(90)  Three of the four Community producers belong to large oil groups, whereas the fourth 
is 100 % owned by an investment fund. As to the ability to raise capital, there was no 
claim  from  the  Community  industry,  or  indication,  that  the  Community  industry 
encountered problems in raising capital for its activities.  

4.10. Employment and wages 

(91)  Employment  in  the  Community  industry  decreased  by  7 %  during  the  period 
considered.  Wages  remained  stable  over  the  period  considered:  total  wages  slightly 
increased by 1 %, which is considerably less than the European inflation rates during 
that period. 

Employees 

Index 

Weighted average salary 
(EUR ’000/year) 

2000 

2001 

627 

100 

75 

642 

102 

75 

Index 

100 

100 

4.11. Productivity 

2002 

596 

95 

73 

97 

2003 

614 

98 

73 

97 

IP 

581 

93 

76 

101 

(92)  Productivity  of  the  Community  industry  increased  by  4 %  during  the  period 
considered. The slight fluctuations over the period considered are directly linked to the 
evolution of employment. This increase shows that the Community producers not only 
adapted  the  number  of  people  employed  in  relation  to  the  decrease  in  sales  but  also 
managed to improve their efficiency.  

2000 

414 

2001 

394 

2002 

456 

2003 

413 

Productivity 
(tonnes/employee) 

Index 

100 

95 

110 

100 

IP 

430 

104 

4.12. Growth 

(93)  While Community consumption decreased by 6 % between 2000 and the IP, the sales 
volume of the Community industry to unrelated customers decreased by 15 %. Thus, 
sales  by  the  Community  industry  went  down  much  more  sharply  than  the  demand 
during  the  period  considered.  Consequently,  the  market  share  of  the  Community 
industry fell by 8 percentage points.  

4.13. Magnitude of the dumping margin  

(94)  As  regards  the  impact  on  the  Community  industry  of  the  magnitude  of  the  actual 
margins  of  dumping,  given  the  volume  and  the  prices  of  the  dumped  imports  from 
Russia and Taiwan this impact cannot be considered negligible. 

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4.14. Recovery from past dumping and subsidisation 

(95) 

It should be recalled that during part of the period considered the Community industry 
was  suffering  from  dumped  and  subsidised  imports  from  Taiwan.  The  Community 
industry  recovered  to  some  extent  after  the  imposition  of  anti-dumping  and 
countervailing  measures  in  2000  on  imports  from  Taiwan.  However,  the  situation  of 
the  Community  industry  deteriorated  again  after  2002  when  imports  from  Taiwan, 
Russia  and  Korea  increased  significantly  with  prices  undercutting  the  Community 
prices. 

5. CONCLUSION ON INJURY 

(96)  The cumulated volumes of dumped imports from Russia and Taiwan have increased, 
both in absolute terms and in terms of market share, representing a cumulated market 
share  of  5,3 %  in  the  IP.  Moreover,  the  weighted  average  price  of  dumped  imports 
from Russia and Taiwan decreased by 12 % over the period considered. This decrease 
is reflected in the price undercutting found. 

(97)  Most  of  the  Community  industry  injury  indicators  have  shown  a  negative  evolution 
during  the  period  considered,  which  points  to  a  situation  of  injury.  While  total 
Community  consumption  of  SBS  decreased  by  7 %,  the  volume  of  the  Community 
industry’s  sales  decreased  by  15 %,  with  a  corresponding  loss  in  market  share  of  7 
percentage  points.  Production  volume  decreased  by  4 %;  production  capacity 
stagnated and capacity utilisation diminished by 4 percentage points. The average unit 
selling  price  decreased  by  1 %  and  profitability  on  net  turnover  by  1,1  percentage 
point during the period considered. Other profitability-related indicators such as return 
on net assets also deteriorated during the period considered. Employment decreased by 
7 %  whereas  productivity  increased  by  4 %.  Finally,  average  salaries  increased  by 
1 %, less than the European inflation rates during the period considered. 

(98)  Based  on  the  above,  it  is  considered  that  the  Community  industry  is  in  a  difficult 
economic and financial situation and has suffered material injury within the meaning 
of Article 3(5) of the basic Regulation. 

1. Introduction 

E. CAUSATION 

(99) 

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

2. Effect of the dumped imports 

(100)  Dumped  imports  from  the  countries  concerned  increased  by  3,8 %  in  market  share 
during the period considered while the price of those imports decreased by 12 % and 
undercut  the  prices  of  the  Community  industry  by  15,3 %  during  the  IP.  The 

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Community industry managed to keep its sales prices largely stable during the period 
considered,  but  this  was  at  the  expense  of  sales  volume  and  market  share,  which  in 
turn had an impact on its profitability.  

(101)  However, while a first analysis of the aforementioned data would suggest a significant 
impact of the dumped imports on the situation of the Community industry, a more in 
depth  examination  does  not  confirm  this.  First,  there  is  only  a  partial  coincidence  in 
time  between  the  deterioration  of  the  situation  of  the  Community  industry  and  the 
moment when the presence of the dumped imports was most strongly felt. While the 
volume  of  dumped  imports  slightly  decreased  between  2001  and  2002,  and  then 
massively increased in 2003 (+ 80 %), the sales of the Community industry showed a 
gradual decrease over the whole period considered. Moreover, the loss of market share 
of  the  Community  industry  took  place  only  during  the  period  2000-2002,  while  the 
dumped imports increased their market share over the whole period considered. This 
increase was particularly strong in 2003 and the IP, as the market share of the dumped 
imports  went  from  2,5  %  in  2002  to  4,7  %  in  2003  and  5,3  %  in  the  IP.  During  the 
same period, the Community industry slightly increased its market share from 81 % in 
2002  to  82  %  in  2003  and  the  IP.  Furthermore  it  is  also  noted  that  the  Community 
industry reached its highest profitability in 2001 and 2002, at the time when its loss of 
market  share  took  place.  Profitability  went  only  down  thereafter.  The  Community 
industry’s sales prices remained stable throughout the period. It is acknowledged that 
these prices were somewhat depressed from 2003 onwards as the Community industry 
could  not  pass  on  some  cost  increases.  However,  the  impossibility  to  pass  on  these 
cost  increases  cannot  or  only  to  a  very  limited  extent  be  attributed  to  the  dumped 
imports,  in  particular  since  it  should  be  noted  that  non-dumped  imports  showed  a 
higher  undercutting  than  the  dumped  imports.  Moreover,  the  market  share  of  the 
dumped imports remained always below 5,3 %, while the non-dumped imports had a 
market share of around 12 %. All this suggests  that any price pressure from imports 
results mostly from the non-dumped imports. 

(102)  Given  the  above,  it  was  found  that  the  dumped  imports  may  have  exerted  a  certain 
pressure  on  the  Community  industry’s  prices  and  had  some  negative  impact  on  the 
situation of the Community industry. However, in the absence of a clearer coincidence 
in time between the development of volumes, market share and prices of the dumped 
imports on the one hand, and of the Community industry on the other, it was difficult 
to  establish  the  impact  of  the  dumped  imports  on  the  injurious  situation  of  the 
Community  industry.  Therefore,  it  could  not  be  concluded  that  the  dumped  imports 
had played a determining role in the injurious situation of the Community industry. 

3. Effects of other factors 

3.1. Development of consumption 

(103)  The  consumption  of  SBS  in  the  Community  decreased  by  7 %  during  the  period 
considered. This may have partially affected the situation in the Community industry, 
as the production of SBS is a capital intensive activity for which the volume of sales 
has a direct influence on profitability.  

(104)  However, the decrease in consumption can only be considered as one of a number of 
causes  of  the  injurious  situation  of  the  Community  industry  as  it  was  shown  that 

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imports  from  Korea,  Russia  and  Taiwan  increased  in  the  period  considered,  thus 
taking over part of the Community industry’s market share.  

3.2. Currency fluctuations 

(105)  Currency  fluctuations  between  the  Euro  and  the  USD  were  also  examined,  as  the 
majority  of  import  transactions  from  the  countries  concerned  into  the  EC  are 
negotiated in USD. The Euro has appreciated in value vis-à-vis the USD as from mid 
2002, and significantly during the IP, thus favouring exports into the Euro area for that 
period.  In  the  light  of  this,  one  exporter  and  an  interested  party  claimed  that  in  a 
‘dollar oriented’ business, the depreciation of this currency in comparison to the Euro 
must have substantially contributed to the injury suffered by the Community industry 
and should therefore be taken into account.  

(106)  However, it should be noted that the revaluation of the Euro at the same time reduced 
the injury suffered by the Community industry as the prices for raw materials, which 
represent  about  40 %  of  the  cost  of  production,  are  quoted  on  international 
commodities markets in USD.  

(107)  Moreover, exports of Community producers to unrelated parties increased during the 
period  considered,  whereas  imports  of  the  product  concerned  from  the  United  States 
into the Community decreased, showing that the appreciation of the Euro vs. USD is 
not  in  itself  a  determining  factor  for  the  loss  in  market  share  of  the  Community 
producers on the EC market.  

(108)  In conclusion, although prima facie it cannot be excluded that the appreciation of the 
Euro  vis-à-vis  the  USD  might  have  favoured  the  imports  of  SBS  from  the  countries 
concerned,  currency  fluctuations  also  counterbalanced  the  injury  suffered  by  the 
Community  industry.  Moreover,  this  appreciation  neither  favoured  the  imports  of 
other  dollar  driven  countries  than  the  countries  concerned  nor  prevented  the 
Community  producers  to  increase  their  exports  outside  the  Community.  It  was 
therefore not considered that currency fluctuations had a material effect on the injury 
suffered  by  the  Community  producers.  More  importantly,  the  injury  analysis  is 
concerned with the prices and quantities of the dumped imports but certainly not with 
the question as to why the dumped imports were made at any given price level. Thus, 
it seems that the effect of exchange rate fluctuations on the prices of dumped imports 
can by definition not normally be another factor of injury. 

3.3. Non-dumped imports 

(109)  The  effects  of  non-dumped  imports  from  Korea  and  Taiwan  on  the  situation  of  the 
Community  industry  were  assessed.  In  order  to  respect  the  confidentiality  of  the 
information provided by individual companies, the data are presented on a cumulated 
basis. 

(110)  The  non-dumped  imports  from  Korea  and  Taiwan  showed  an  identical  trend.  On  a 
cumulated basis, they increased by 56 % in terms of volume and 5,2 percentage points 
in  terms  of  market  share  during  the  period  considered,  reaching  a  market  share  of 
12,8 % in the IP. The volume of those non-dumped imports thus represented 2,4 times 
the volume of dumped imports during the IP. Moreover, the undercutting margin that 
could  be  calculated  for  non-dumped  Korean  and  Taiwanese  imports  was  higher 

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(17,4 %)  than  for  dumped  imports  (15,3 %).  This  substantial  undercutting  together 
with  the  significant  volumes  of  non-dumped  imports  strongly  contributed  to  the 
pressure on prices observed on the EC market.  

(111)  On  this  basis,  it  was  concluded  that  the  volume  and  price  effect  of  the  non-dumped 
imports  from  Korea  and  Taiwan  were  such  that  they  can  be  considered  to  have 
substantially  contributed  to  the  injury  suffered  by  the  Community  industry,  and  that 
the  dumped  imports  from  Russia  and  Taiwan  played  a  less  important  role  than  the 
non-dumped imports. 

3.4. Imports from other third countries 

(112)  Imports from all other third countries had a market share of 0,4 % in the Community 
during the IP and it was concluded that their impact on the injurious situation suffered 
by the Community industry was not significant. 

3.5. Costs of raw materials 

(113)  It  was  noted  that  the  costs  of  raw  materials  have  increased  during  the  period 
considered. This contributed to the declining profitability of the Community industry. 
However,  the  Community  industry  would  normally  seek  to  pass  on  those  cost 
increases to their customers. Due to the existence of large price pressure exerted by the 
non-dumped imports and probably to a much lesser extent by the dumped imports, this 
was not possible. Moreover, the Korean and Taiwanese exporting producers also faced 
an increase in their raw material costs, of a similar level to the Community producers. 
It was therefore not the increase of raw material costs in the Community as such but 
rather  the  coincidence  between  the  pressure  on  price  exerted  by  imports  and  the 
increase of the costs which had a negative effect on the profitability of the Community 
industry. 

(114)  Given the above, it was concluded that the variations in the costs of raw materials in 
the  Community  were  not  as  such  a  factor  which  caused  injury  to  the  Community 
industry.  

4. Conclusion on causation 

(115)  The data suggest that the dumped imports had exerted a certain price pressure on the 
Community industry’s prices and had contributed to its injurious situation. However, a 
more  detailed  analysis,  in  particular  based  on  the  development  of  trends  over  the 
period  considered  did  not  allow  to  establish  a  causal  link  as  there  was  no  clear 
coincidence  in  time  between  the  deterioration  of  the  situation  of  the  Community 
industry and the effects of the dumped imports.  

(116)  It was also found that, to the extent that a coincidence in time existed between, on the 
one  hand,  the  increase  of  dumped  imports  from  Russia  and  Taiwan,  in  terms  of 
volumes and market share, and, on the other hand, the deterioration of the situation of 
the Community industry, which materialised in a loss in market share and a decrease 
in profitability, such a coincidence in time also existed for non-dumped imports, which 
had  a  steeper  increase  in  volume  than  the  dumped  imports  during  the  period 
considered.  

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(117)  Moreover,  the  non-dumped  imports  from  Korea  and  Taiwan  had  during  the  IP  a 
significantly higher volume than the dumped imports, leading to a significantly higher 
market  share  (12,8 %  vs.  5,3 %).  In  addition,  both  the  dumped  and  the  non-dumped 
imports  undercut  the  Community  prices,  with  non-dumped  imports  showing  even 
higher  levels  of  undercutting.  The  Community  industry  therefore  faced  more  intense 
competition, at fair prices, of imports from other producers/countries than those found 
to  dump.  The  non-dumped  imports  were  thus  a  prevailing  factor  in  the  injurious 
situation of the Community industry.  

(118)  It was also found that the decrease in consumption in the EC contributed to the injury 

suffered by the Community industry. 

(119)  The Community industry contested these conclusions, arguing that the impact of other 
factors  was  not  such  as  to  break  the  causal  link  between  the  dumped  imports  from 
Russia and Taiwan and the injury suffered by the Community industry. However, as 
they  did  not  present  any  arguments  which  could  invalidate  the  appreciation  and 
conclusions  made  under  recitals  (100)  to  (102),  (103),  (109)  to  (111)  and  (115)  to 
(118), it was considered that the arguments put forward were not sufficient to conclude 
differently. 

(120)  In  conclusion,  although  the  dumped  imports  may  have  contributed  to  the  injury,  it 
could  not  be  established  that,  taken  in  isolation,  they  have  caused  material  injury. 
Indeed, other factors were examined pursuant to Article 3(7) of the basic Regulation 
and the injury could be attributed significantly to the effects of non-dumped prices and 
contraction in demand.  

F. LASTING NATURE OF THE CHANGED CIRCUMSTANCES 

(121)  Within the framework of the interim review concerning Taiwan, it was also examined 
whether the changed circumstances with respect to the original investigation regarding 
dumping could reasonably be considered to be of a lasting nature in accordance with 
Article 11(3) of the basic Regulation. 

(122)  The  likely  development  of  domestic  prices  on  the  Taiwanese  market  and  of  export 
prices of SBS from Taiwan was examined. In this  respect,  it was found  that Taiwan 
had a substantial domestic market for the product concerned, and that domestic prices 
had  increased  in  comparison  with  the  original  investigation,  in  an  even  higher 
proportion than the costs of raw materials. 

(123)  With regard to exports of SBS from Taiwan to other markets, it should first be noted 
that  the  EU  market  represents  a  small  proportion  of  total  exports.  Indeed,  the 
investigation showed that the cooperating companies sold 75 % of their production of 
SBS  to  well-established  third  country  markets.  In  addition,  it  was  noted  that  export 
prices  had  steadily  increased  from  2002  until  the  IP,  by  about  10 %  and  15 %. 
Therefore it is not expected that the termination of measures vis-à-vis Taiwan will lead 
to a significant risk of renewed dumping. 

(124)  In  accordance with Article 11(3) of the basic  Regulation,  it was therefore  concluded 
that  the  changed  circumstances  with  respect  to  the  original  investigation  regarding 
dumping could reasonably be considered to be of a lasting nature.  

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G. CONCLUSION 

(125)  In view of the fact that no dumping was found for imports of SBS originating in Korea 
and  for  one  company  in  Taiwan  and  that  the  injury  suffered  by  the  Community 
industry could be significantly attributed to other factors such as volumes and prices of 
imports not sold at dumped prices and contraction in demand, the causal link between 
dumping and injury insofar as dumped imports originating in Russia and Taiwan are 
concerned  could  not  be  sufficiently  established.  The  anti-dumping  proceedings 
regarding SBS originating in Korea, Russia and Taiwan shall therefore be terminated 
in accordance with Article 9(2) and 9(3) of the basic Regulation. 

HAS ADOPTED THIS REGULATION: 

The anti-dumping proceeding concerning imports of styrene-butadiene-styrene thermoplastic 
rubber originating in the Republic of Korea and Russia is hereby terminated. 

Article 1 

Council Regulation (EC) No 1993/2000 imposing a definitive anti-dumping duty on imports 
of styrene-butadiene-styrene thermoplastic rubber is hereby repealed. 

Article 2 

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

Article 3 

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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