Proposal for a Council Regulation amending Regulation (EC) No 1480/2003 imposing a definitive countervailing duty and collecting definitely the provisional duty imposed on imports of certain electronic microcircuits known as DRAMs (Dynamic Random Access Memories) originating in the Republic of Korea
Date: 2005-11-24
Institutions: European Commission
Subjects: South Korea, countervailing charge, electronic component, import, originating product

COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 24.11.2005 
COM(2005) 599 final 

Proposal for a 

COUNCIL REGULATION 

amending Regulation (EC) No 1480/2003 imposing a definitive countervailing duty and 
collecting definitely the provisional duty imposed on imports of certain electronic 
microcircuits known as DRAMs (Dynamic Random Access Memories) originating in the 
Republic of Korea 

(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  2026/97  of 
6 October 1997 on protection against subsidised 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  electronic  integrated  circuits  known  as  Dynamic  Random  Access 
Memories (‘DRAMs’) originating in the Republic of Korea. 

•  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. 

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3)  LEGAL ELEMENTS OF THE PROPOSAL 

•  Summary of the proposed action 

On 22 March 2005, the Commission initiated an investigation with regard to imports of 
DRAMs originating in the Republic of Korea. The purpose of this investigation was to 
examine to what extent special provisions may need to be adopted pursuant to Article 
24(3)  of  the  basic  Regulation  in  order  to  ensure  that  the  countervailing  duty  be 
correctly levied on imports of the product concerned. 

Following  an  examination  of  the  information  submitted  by  all  the  various  parties,  it 
was  found  that  (1)  the  description  of  the  product  concerned  needed  to  be  clarified  to 
ensure that the countervailing duty is levied on all types of product concerned, and that 
(2)  a  system  had  to  be  put  in  place  to  ensure  that  one  type  of  product  concerned  be 
correctly  declared  and  customs  authorities  be  enabled  to  perform  the  appropriate 
checks and collect the relevant duties. 

The  Member  States  were  consulted  regarding  this  investigation.  19  Member  States 
supported and 2 Member States opposed the proposal. 4 Member States abstained. 

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  as  soon  as 
possible.  

•  Legal basis 

Council  Regulation  (EC)  No  2026/97  of  6  October  1997  on  protection  against 
subsidised  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  because  the  basic  Regulation  does  not  foresee 

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alternative options. 

4)  BUDGETARY IMPLICATION 

The proposal has no implication for the Community budget. 

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Proposal for a 

COUNCIL REGULATION 

amending Regulation (EC) No 1480/2003 imposing a definitive countervailing duty and 
collecting definitely the provisional duty imposed on imports of certain electronic 
microcircuits known as DRAMs (Dynamic Random Access Memories) originating in the 
Republic of Korea 

THE COUNCIL OF THE EUROPEAN UNION, 

Having regard to the Treaty establishing the European Community, 

Having  regard  to  Council  Regulation  (EC)  No  2026/97  of  6  October  1997  on  protection 
against  subsidised  imports  from  countries  not  members  of  the  European  Community1  (‘the 
basic Regulation’), and in particular Article 24(3) thereof, 

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

Whereas: 

A. 

PROCEDURE 

1. 

Existing measures 

(1) 

(2) 

By Regulation (EC) No 1480/20032 (‘the original Regulation’), the Council imposed a 
definitive  countervailing  duty  of  34,8%  (‘the  countervailing  duty’)  on  imports  of 
certain  electronic  microcircuits  known  as  Dynamic  Random  Access  Memories 
(‘DRAMs’) originating in the Republic of Korea and manufactured by all companies 
other than Samsung Electronics Co., Ltd (‘Samsung’), for which a 0% duty rate was 
established. 

Two  exporting  producers  located  in  the  Republic  of  Korea  co-operated  in  the 
investigation  which  lead  to  the  imposition  of  the  existing  measures  (‘the  original 
investigation’),  Samsung  and  Hynix  Semiconductor  Inc.,  which  also  owns  a 
production  facility  in  the  United  States.  The  Community  industry  in  the  original 
investigation consisted of two producers which accounted for the major proportion of 
the  total  Community  production  of  DRAMs,  Infineon  Technologies  AG,  Munich, 
Germany, and Micron Europe Ltd, Crowthorne, United Kingdom. 

1 

2 

OJ  L  288,  21.10.1997,  p.  1.  Regulation  as  last  amended  by  Regulation  (EC)  No  461/2004  (OJ  L  77, 
13.3.2004, p. 12). 
OJ L 212, 22.8.2003, p. 1. 

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(3) 

(4) 

(5) 

(6) 

(7) 

2.  Grounds for the current investigation 

In  the  context  of  the  monitoring  of  trade  defence  measures,  the  Commission  was 
informed that the countervailing duty in force on imports of DRAMs originating in the 
Republic of Korea was possibly not being levied on certain imports of said DRAMs. 

3.  Opening of an investigation 

On 22 March 2005, by a notice (‘the notice’) published in the Official Journal of the 
European Union3, the Commission announced the opening of an investigation with a 
view  to  determining  to  what  extent  special  provisions  may  need  to  be  adopted  in 
accordance  with  Article  24(3)  of  the  basic  Regulation  in  order  to  ensure  that  the 
countervailing  duty  is  correctly  levied  on  imports  of  DRAMs  originating  in  the 
Republic of Korea. 

4. 

Submissions 

The Commission officially advised the authorities of the exporting country and all the 
parties  known  to  be  concerned  of  the  opening  of  this  investigation.  Copies  of  the 
notice  and  of  the  non-confidential  documents  on  the  basis  of  which  the  notice  was 
published were sent to the two exporting producers in the Republic of Korea, as well 
as  to  importers,  users  and  to  the  two  producers  in  the  Community,  named  in  the 
original investigation or otherwise known to the Commission. 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. 

Submissions were received from the two exporting producers in the Republic of Korea 
and from the two producers and one user in the Community. Given the availability of 
all necessary information and data needed, it was not considered necessary to carry out 
verification visits at the premises of the companies that made the above submissions. 

B. 

PRODUCT CONCERNED  

The product concerned by this investigation is the same as that covered by the original 
investigation, i.e. certain electronic microcircuits known as Dynamic Random Access 
Memories  (‘DRAMs’),  of  all  types,  densities  and  variations,  whether  assembled,  in 
processed  wafer  or  chips  (dies),  manufactured  using  variations  of  Metal  Oxide-
Semiconductors  (‘MOS’)  process  technology,  including  complementary  MOS  types 
(CMOS),  of  all  densities  (including  future  densities),  irrespective  of  access  speed, 
configuration,  package  or  frame  etc.,  originating  in  the  Republic  of  Korea.  The 
product  concerned  also  includes  DRAMs  presented  in  (non-customized)  memory 
modules  or  (non-customized)  memory  boards,  or  in  some  other  kind  of  aggregate 
form, provided the main purpose of which is to provide memory. 

(8) 

The product concerned is currently classifiable within CN codes 8542 21 11, 8542 21 
13, 8542 21 15, 8542 21 17, ex 8542 21 01, ex 8542 21 05, ex 8548 90 10, ex 8473 30 
10 and ex 8473 50 10. 

3 

OJ C 70, 22.3.2005, p. 2. 

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C. 

RESULTS OF THE INVESTIGATION 

(9) 

In  order  to  determine  to  what  extent  special  provisions  may  need  to  be  adopted  to 
ensure that the countervailing duty is correctly levied, the investigation focused on the 
following elements: (1) the description of the product concerned and its transposition 
into  the  Combined  Nomenclature  (CN)/TARIC  nomenclature,  and  (2)  the  anomalies 
resulting from the analysis of the trade flows of the product concerned imported into 
the Community. 

1.  Description  of  the  product  concerned  and  transposition 

into  the 

CN/TARIC nomenclature 

(10)  Article 1(1) of the original Regulation establishes that the product concerned subject to 
the  countervailing  duty  is  certain  electronic  microcircuits  known  as  DRAMs  of  all 
types originating in the Republic of Korea. The product concerned is such regardless 
of  the  density,  access  speed,  configuration,  package  or  frame,  etc.  In  addition,  the 
manufacturing process is also mentioned (variations of Metal Oxide-Semiconductors – 
MOS - process technology, including complementary MOS types – CMOS). 

(11)  On  the  one  hand,  Article  1(1)  of  the  original  Regulation  identifies  the  CN/TARIC 
codes  under  which  the  product  concerned  is  classifiable.  The  following  types  of 
DRAMs are covered by these CN/TARIC codes: wafers, chips (dies), memories (chips 
mounted, i.e. with their terminals or leads, whether or not encased in ceramic, metal, 
plastics  or  other  materials,  hereafter  referred  to  as  ‘mounted  DRAMs’  and  known 
commercially as DRAM components) and DRAM modules, memory boards and some 
other  kind  of  aggregate  form  (hereafter  referred  to  as  ‘multi-combinational  forms  of 
DRAMs’). 

(12)  With regard to mounted DRAMs, this type of DRAM results from the so-called “back-
end process”, that is chips which underwent an assembly (connection of the memory 
cell on the chip with a wire to the connectors on the outside of the capsule), testing (to 
check whether the encapsulated chips are functioning) and marking process.  

(13)  On the other hand, the types of the product concerned explicitly mentioned in Article 
1(1) of the original Regulation are wafers, chips (dies), assembled DRAMs (meaning 
mounted DRAMs and multi-combinational forms of DRAMs) and DRAMs presented 
in  (non-customised)  memory  modules  or  memory  boards  or  in  some  other  kind  of 
aggregate  form  (hereafter  referred  to  as  ‘DRAM  chips  and/or  mounted  DRAMs 
incorporated in multi-combinational forms of DRAMs’).  

(14)  The  above  elements  show  that  the  description  of  the  product  concerned  and  the 
CN/TARIC codes are not fully in line. On the one hand, mounted DRAMs, although 
clearly falling within the definition of product concerned – which includes all types of 
DRAMs  –  and  specifically  mentioned  in  the  description  of  the  CN/TARIC  codes 
indicated in Article 1(1) of the original Regulation, were referred to in the description 
of the product concerned with the ambiguous wording ‘assembled’, which also refers 
to  multi-combinational  forms  of  DRAMs.  On  the  other  hand,  DRAM  chips  and/or 
mounted  DRAMs  incorporated  in  multi-combinational  forms  of  DRAMs,  although 
explicitly mentioned in the description of the product concerned, were not specifically 
mentioned in the description of any of the CN/TARIC codes indicated in Article 1(1) 
of  the  original  Regulation.  Indeed,  the  latter  either  specifically  mention  DRAMs  in 

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multi-combinational forms or the chips and mounted DRAMs imported as such – and, 
as  a  consequence,  the  countervailing  duty  has  not  been  levied  so  far  on  this  type  of 
DRAMs. 

(15)  With regard to mounted DRAMs, these are distinct both from DRAM chips and from 
multi-combinational  forms  of  DRAMs.  Consequently,  for  the  sake  of  coherence  and 
legal  certainty,  it  appears  appropriate  that  the  product  description  makes  explicit 
reference thereto. 

the  CN/TARIC  codes  becomes  relevant 

(16)  With  respect  to  DRAM  chips  and/or  mounted  DRAMs  incorporated  in  multi-
combinational forms of DRAMs, the fact that these are not specifically mentioned by 
any  of 
in  situations  where  multi-
combinational forms of DRAMs are not originating in the Republic of Korea and are 
therefore  not  subject  to  the  countervailing  duty  when  imported  into  the  Community, 
despite the fact that they incorporate DRAM chips and/or mounted DRAMs of Korean 
origin. 

(17) 

Indeed, in line with the constant practice within the EU Member States to use the EC 
negotiating position in the WTO Harmonisation Working Programme as the basis for 
the interpretation of Article 24 of the Community Customs Code4, the non-preferential 
rules of origin applicable in the Community to multi-combinational forms of DRAMs, 
falling within CN codes ex 8473 30 10, ex 8473 50 10, and ex 8548 90 10, establish 
that the country of origin shall be the last country of manufacture where the increase in 
value  acquired  as  a  result  of  working  and  processing,  and  if  applicable,  the 
incorporation  of  parts  originating  in  that  country,  represent  at  least  45%  of  the  ex-
works  price  of  the  multi-combinational  form  of  DRAMs.  In  case  this  rule  is  not 
satisfied, DRAMs are considered to be originating in the country in which the major 
portion of the materials used originated. 

(18)  The documents and pieces of evidence submitted during the investigation enabled to 
conclude  that  multi-combinational  forms  of  DRAMs  of  non-Korean  origin  could 
incorporate  DRAM  chips  and/or  mounted  DRAMs  of  Korean  origin.  Three  types  of 
evidences allowed to draw the above conclusion. First of all, prima facie evidence was 
submitted  showing  that  some  multi-combinational  forms  of  DRAMs  declared  as 
originating  in  countries  other  than  the  Republic  of  Korea  incorporated  mounted 
DRAMs originating in the Republic of Korea and manufactured by companies subject 
to  the  countervailing  duty.  Secondly,  Binding  Origin  Information  issued  in  2003 
concerned multi-combinational forms of DRAMs falling within CN code ex 8548 90 
10  (TARIC  code  8548  90  10*10),  which  were  manufactured  partly  in  the  US  and 
partly in the Republic of Korea. Finally, two press articles were submitted, in which 
reference  was  made  to  the  fact  that  non-preferential  rules  of  origin  applicable  in  the 
Community allowed Korean companies to export to the Community DRAM chips or 
mounted  DRAMs  manufactured  by  Korean  companies  subject  to  the  countervailing 
duty, by incorporating them in DRAM modules which were declared with origin other 
than the Republic of Korea. 

4 

Council  Regulation  (EEC)  No  2913/92  (OJ  L  302,  19.10.1992,  p.  1)  as  last  amended  by  Regulation 
(EC) No 648/2005 of the European Parliament and of the Council (OJ L 117, 4.5.2005, p. 13). 

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(19) 

In the light of the above, it is considered that special provisions are needed in order to 
ensure  that  the  countervailing  duty  is  levied  on  DRAM  chips  or  mounted  DRAMs 
manufactured  by  companies  subject  to  the  countervailing  duty  and  incorporated  in 
multi-combinational forms of DRAMs originating in countries other than the Republic 
of Korea. 

(20)  One  of  the  companies  subject  to  the  countervailing  duty  argued  that  once  DRAM 
chips or mounted DRAMs are incorporated in multi-combinational forms of DRAMs, 
they can no longer be considered as a product potentially subject to the countervailing 
duty.  In  this  respect,  it  is  considered  that  DRAM  chips  or  mounted  DRAMs  once 
incorporated  in  multi-combinational  forms  of  DRAMs  still  maintain  their  properties 
and functions. The fact of being incorporated in multi-combinational forms of DRAMs 
does not alter their basic physical and technical characteristics. Moreover, the function 
performed by the multi-combinational forms of DRAMs, which is to provide memory, 
is exactly, although on a larger scale, the same as the one of DRAM chips or mounted 
the 
individually.  Therefore, 
DRAMs  when  considered 
incorporation  of  DRAM  chips  or  mounted  DRAMs  in  multi-combinational  forms  of 
DRAMs does not change their nature and cannot be considered as a reason to exclude 
them from the application of the countervailing duty. For these reasons, the claim was 
rejected. 

is  concluded 

that 

it 

(21)  The  same  party  and  the  Government  of  the  Republic  of  Korea  argued  that  DRAM 
chips  and  mounted  DRAMs  presented  in  multi-combinational  forms  of  DRAMs  are 
not  referred  to  in  Article  1(1)  of  the  original  Regulation  since  they  would  not  have 
been covered by the original investigation. As already mentioned in recital (13) above, 
Article 1(1) of the original Regulation clearly specifies that the countervailing duty is 
also imposed on DRAM chips and mounted DRAMs presented in multi-combinational 
forms. As to the claim that mounted DRAMs presented in multi-combinational forms 
of DRAMs would not have been investigated in the original investigation, no evidence 
was  provided  which  could  show  that  this  was  the  case.  On  the  contrary,  given  the 
nature of the subsidies received, all the sales of the investigated companies were taken 
into account to assess the level of subsidisation in the original investigation. For these 
reasons, the claim was rejected.  

2.  Anomalies resulting from the analysis of the trade flows 

(22) 

In  the  light  of  the  non-preferential  rules  of  origin  applicable  in  the  Community  to 
DRAMs, import flows were analysed in relation to two main categories of the product 
concerned:  on  the  one  hand  DRAM  wafers,  chips  and  mounted  DRAMs,  which 
originate in the country where the operation of diffusion takes place5 and, on the other 
hand, multi-combinational forms of DRAMs, which originate in the country that meets 
the criteria indicated in recital (17). The analysis covered the period running from May 
2003 to May 2005 and was based on Comext statistics at TARIC code level. 

(23)  With  regard  to  the  first  category  of  the  product  concerned,  it  was  established  on  the 
basis  of  information  submitted  by  the  Community  industry  that  the  operation  of 
diffusion  is  currently  taking  place  exclusively  in  the  following  countries  outside  the 
Community  (in  decreasing  order  of  manufacturing  capacity):  the  Republic  of  Korea, 

5 

Annex 11 of Commission Regulation (EEC) No 2454/93 (OJ L 253, 11.10.1993, p. 1). 

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Taiwan,  the  US,  Japan,  Singapore  and  the  People’s  Republic  of  China.  It  therefore 
results  that  imports  declared  as  originating  in  countries  other  than  these  ones  are 
wrongly declared. This fact appears to be particularly evident for imports declared as 
originating in Malaysia, Hong Kong and, to a certain extent, the People’s Republic of 
China which has only limited diffusion capacities. In addition to these latter countries, 
imports of DRAMs were also reported in Comext from other countries. 

(24)  Given the fact that the applicable non-preferential rules of origin are sufficiently clear 
and that any wrong indication of origin in the customs declaration can be addressed by 
customs authorities in line with the applicable legislation, it is considered that the most 
appropriate  way  to  solve  this  problem  is  to  regularly  inform  customs  authorities  of 
countries where the operation of diffusion takes place so that appropriate controls can 
be made. 

(25)  With  regard  to  the  second  category  of  the  product  concerned,  it  was  found  that  they 
represent the bulk of imports into the Community (73%) out of all types of DRAMs. 
In  particular,  imports  declared  as  originating  in  Malaysia  represent  78%  out  of  all 
types  imported  from  this  country,  95%  for  Hong  Kong  and  93%  for  the  People’s 
Republic of China. 

(26)  As  explained  above,  no  or  limited  diffusion  operations  take  place  in  the  countries 
mentioned  in  recital  (25).  In  this  regard,  evidence  was  provided  showing  that  the 
maximum  amount  of  value  that  could  be  added  in  these  countries  was  likely  to  be 
insufficient to meet the 45% value required by existing rules of origin and furthermore 
was  even  more  unlikely  to  constitute  the  major  portion  of  the  overall  manufacturing 
process. 

(27) 

In the light of the above, it is considered that special provisions are needed in order to 
ensure  that  the  origin  of  multi-combinational  forms  of  DRAMs  is  correctly  declared 
and customs authorities are enabled to perform the appropriate checks. 

D. 

PROPOSED SPECIAL PROVISIONS 

(28) 

In the light of the above findings, it is concluded that special provisions are needed for 
the purpose of: 

(a) 

clarifying the description of the product concerned; 

(b) 

(c) 

ensuring  that  the  origin  of  multi-combinational  forms  of  DRAMs  is  correctly 
declared  and  customs  authorities  are  enabled  to  perform  the  appropriate 
checks; 

ensuring the levy of the countervailing duty on import of multi-combinational 
forms of DRAMs originating in countries other than the Republic of Korea and 
incorporating  DRAM  chips  and/or  mounted  DRAMs  originating  in  the 
Republic of Korea; 

(d) 

ensuring the levy of the countervailing  duty in case of lack  of information or 
lack of co-operation by the declarant. 

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(29)  The  special  provision  referred  to  under  point  a)  of  recital  (28)  should  consist  in  a 
clearer  description  of  the  product  concerned,  singling  out  all  different  forms  of 
DRAMs and mentioning explicitly mounted DRAMs. 

(30)  The special provisions referred to under points b) and c) of recital (28) should take the 
form  of  a  reference  number  to  be  indicated  by  the  declarant  in  box  44  of  the  Single 
Administrative  Document  (‘SAD’)  at  the  moment  of  the  customs  declaration  for 
release into free circulation of the imported DRAM. Such a number should correspond 
to  the  description  of  the  multi-combinational  form  of  DRAM  which  takes  into 
consideration (1) its form, (2) its origin (‘Republic of Korea’ or ‘countries other than 
the Republic of Korea’), (3) the Korean company (‘Samsung’ or ‘all companies other 
than Samsung’), if applicable, involved in the manufacturing process and (4) in case of 
multi-combinational forms of DRAMs originating in countries other than the Republic 
of  Korea  incorporating  DRAM  chips  and/or  mounted  DRAMs  originating  in  the 
Republic of Korea and manufactured by all companies other than Samsung, the value 
represented by the DRAM chips and/or mounted DRAMs out of the overall value of 
the  multi-combinational  form  of  DRAM.  The  following  reference  numbers 
corresponding to the below product/origin descriptions should apply: 

No 

Product/origin description 

Reference number 

1  Multi-combinational forms of DRAMs originating in countries other 
than  the  Republic  of  Korea,  incorporating  DRAM  chips  and/or 
mounted DRAMs originating in countries other than the Republic of 
Korea or originating in the Republic of Korea and manufactured by 
Samsung 

2  Multi-combinational forms of DRAMs originating in countries other 
than  the  Republic  of  Korea,  incorporating  DRAM  chips  and/or 
mounted  DRAMs  originating  in  the  Republic  of  Korea  and 
manufactured by all companies other than Samsung and representing 
less  than  10%  of  the  net  free-at-Community-frontier  price  of  the 
multi-combinational form of DRAM 

3  Multi-combinational forms of DRAMs originating in countries other 
than  the  Republic  of  Korea,  incorporating  DRAM  chips  and/or 
mounted  DRAMs  originating  in  the  Republic  of  Korea  and 
manufactured by all companies other than Samsung and representing 
10%  or  more  but  less  than  20%  of  the  net  free-at-Community-
frontier price of the multi-combinational form of DRAM 

4  Multi-combinational forms of DRAMs originating in countries other 
than  the  Republic  of  Korea,  incorporating  DRAM  chips  and/or 
mounted  DRAMs  originating  in  the  Republic  of  Korea  and 
manufactured by all companies other than Samsung and representing 
20%  or  more  but  less  than  30%  of  the  net  free-at-Community-
frontier price of the multi-combinational form of DRAM 

5  Multi-combinational forms of DRAMs originating in countries other 
than  the  Republic  of  Korea,  incorporating  DRAM  chips  and/or 
mounted  DRAMs  originating  in  the  Republic  of  Korea  and 
manufactured by all companies other than Samsung and representing 
30%  or  more  but  less  than  40%  of  the  net  free-at-Community-
frontier price of the multi-combinational form of DRAM 

D010 

D011 

D012 

D013 

D014 

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6  Multi-combinational forms of DRAMs originating in countries other 
than  the  Republic  of  Korea,  incorporating  DRAM  chips  and/or 
mounted  DRAMs  originating  in  the  Republic  of  Korea  and 
manufactured by all companies other than Samsung and representing 
40%  or  more  but  less  than  50%  of  the  net  free-at-Community-
frontier price of the multi-combinational form of DRAM 

7  Multi-combinational forms of DRAMs originating in countries other 
than  the  Republic  of  Korea,  incorporating  DRAM  chips  and/or 
mounted  DRAMs  originating  in  the  Republic  of  Korea  and 
manufactured by all companies other than Samsung and representing 
50%  or  more  of  the  net  free-at-Community-frontier  price  of  the 
multi-combinational form of DRAM 

D015 

D016 

(31)  The product/origin description falling under number 1 should not be accompanied by 
any  additional  supporting  evidence.  Indeed,  the  indication  of  a  reference  number,  as 
such,  is  considered  as  sufficient  to  raise  the  attention  of  the  declarant  to  the  need  to 
check  carefully  the  origin  and  the  location  of  all  manufacturers  involved.  Moreover, 
any  additional  document  would  put  an  undue  burden  on  the  declarant  in  case  of 
imports  of  DRAMs  in  the  manufacture  of  which  no  company  subject  to  the 
countervailing duty has intervened. 

(32)  The product/origin descriptions falling under numbers 2 to 7 should, on the contrary, 
be  accompanied  by  a  statement  issued  by  the  last  manufacturer  of  the  DRAM  and 
submitted  by  the  declarant  together  with  the  SAD  at  the  moment  of  the  customs 
declaration for release into free circulation, in conformity with the text provided in the 
Annex.  Such  a  statement  should  mention,  inter  alia,  the  value  of  the  manufacturing 
process  carried  out  by  the  companies  subject  to  the  countervailing  duty  out  of  the 
overall value of the imported DRAMs. 

(33)  With regard to the countervailing duty rate applicable to multi-combinational forms of 
DRAMs  falling  under  numbers  2  to  7,  this  should  be  calculated  in  proportion  to  the 
value represented by the incorporated DRAM chip and/or mounted DRAM originating 
in the Republic of Korea out of the overall value of the multi-combinational form of 
DRAM. With a view to simplifying the customs procedure and the application of the 
appropriate  duty  rates  corresponding  to  that  value,  the  following  six  levels  of  duty 
rates  should  be  established,  each  corresponding  to  the  following  numbers  of 
product/origin descriptions: 

– 

– 

– 

– 

– 

– 

No 2: a duty rate of 0% should apply; 

No 3: a duty rate of 3,4% should apply; 

No 4: a duty rate of 6,9% should apply; 

No 5: a duty rate of 10,4% should apply; 

No 6: a duty rate of 13,9% should apply; 

No 7: a duty rate of 17,4% should apply. 

(34)  Each level of duty rate established in recital (33) corresponds to the lowest percentage 
(foreseen for the relevant range of multi-combinational forms of DRAMs) applied to 

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the countervailing duty (for example, 10% of 34,8% for multi-combinational forms of 
DRAMs  falling  under  No  3,  i.e.  3,4%),  to  ensure  a  balanced  application  of  the 
provision  and  to  avoid  any  disproportionate  burden  to  the  economic  operators 
importing and selling the product concerned in the Community. 

(35)  Finally, with regard to the special provision referred to under point d) of recital (28), it 
is considered that the lack of both the indication of a reference number in box 44 of the 
SAD, as foreseen in recital (30), and of a statement, in the cases mentioned in recital 
(32),  should  trigger  the  application  of  the  countervailing  duty  rate  of  34,8%  since  it 
should be assumed – unless the contrary is proved – that the multi-combinational form 
of  DRAM  is  originating  in  the  Republic  of  Korea  and  has  been  manufactured  by 
companies subject to the countervailing duty. 

(36) 

In  addition,  in  the  cases  mentioned  in  recital  (32),  should  some  of  the  DRAM  chips 
and/or mounted DRAMs incorporated in multi-combinational forms of DRAMs not be 
clearly  marked  and  their  manufacturers  not  be  clearly  identifiable  from  the  required 
statement,  it  should  be  assumed  -  unless  the  contrary  is  proved  –  that  such  DRAM 
chips and/or mounted DRAMs are originating in the Republic of Korea and have been 
manufactured by companies subject to the countervailing duty. This should trigger the 
application  of  the  countervailing  duty  rate  of  34,8%  in  those  cases  where,  as  a 
consequence  of  the  above,  the  multi-combinational  form  of  DRAMs  originate  in  the 
Republic of Korea. In all other cases, the applicable countervailing duty should be the 
rate foreseen in recital (33), corresponding to the ranges of values established in recital 
(30). 

(37)  With regard to the special provision and the circumstances referred to in recitals (35) 
and (36) above, it was found that DRAM suppliers have contractual obligations vis-à-
vis  their  clients  to  maintain  certain  specifications  defined  by  industry  standards, 
including  the  reference  to  the  name  of  the  companies  where  diffusion  and  assembly 
took  place.  Hence,  it  is  considered  that  the  information  and  the  evidence  to  be 
provided are not putting any undue burden on the declarant, 

HAS ADOPTED THIS REGULATION: 

Article 1 

Council Regulation (EC) No 1480/2003 is hereby amended as follows: 

1. 

Article 1(1) shall be replaced by the following: 

‘1.  A  definitive  countervailing  duty  is  hereby  imposed  on  imports  of  certain 
electronic  integrated  circuits  known  as  Dynamic  Random  Access  Memories 
(DRAMs)  manufactured  using  variations  of  metal  oxide-semiconductors  (MOS) 
process  technology,  including  complementary  MOS  types  (CMOS),  of  all  types, 
densities, variations, access speed, configuration, package or frame, etc., originating 
in the Republic of Korea. 

DRAMs defined in the preceding paragraph take the following forms: 

– 

DRAM wafers falling within CN code ex 8542 21 01 (TARIC code 8542 21 01 
10), 

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– 

– 

– 

– 

DRAM chips (dies) falling within CN code ex 8542 21 05 (TARIC code 8542 
21 05 10), 

mounted DRAMs falling within CN codes 8542 21 11, 8542 21 13, 8542 21 15 
and 8542 21 17, 

multi-combinational  forms  of  DRAMs  (memory  modules,  memory  boards  or 
other  aggregate  forms)  falling  within  CN  codes  ex  8473  30  10  (TARIC  code 
8473 30 10 10), ex 8473 50 10 (TARIC code 8473 50 10 10) and ex 8548 90 
10 (TARIC code 8548 90 10 10), 

chips  and/or  mounted  DRAMs  incorporated  in  multi-combinational  forms  of 
DRAMs  provided  the  multi-combinational  form  of  DRAM  is  originating  in 
countries other than the Republic of Korea, falling within CN codes ex 8473 30 
10 (TARIC code 8473 30 10 10), ex 8473 50 10 (TARIC code 8473 50 10 10) 
and ex 8548 90 10 (TARIC code 8548 90 10 10).’ 

2. 

Article 1(2) shall be replaced by the following: 

‘2.  The  rate  of  the  definitive  countervailing  duty  applicable  to  the  net  free-at-
Community-frontier price, before duty, shall be as follows: 

Korean Producers 

Rate of Duty (%) 

TARIC additional code 

Samsung Electronics Co., Ltd (‘Samsung’) 
24th Fl., Samsung Main Bldg 
250, 2-Ga, Taepyeong-Ro 
Jung-Gu, Seoul 

Hynix Semiconductor Inc. 
891, Daechidong 
Kangnamgu, Seoul 

0% 

A437 

34,8% 

A693 

All other companies 

34,8% 

A999’ 

3. 

4. 

Article 1(3) shall be re-numbered Article 1(7). 

A new Article 1(3) shall be inserted as follows: 

‘3.  Upon  presentation  to  the  Member  State’s  customs  authorities  of  the  customs 
declaration for release into free circulation of multi-combinational forms of DRAMs, 
the  declarant  shall  indicate  in  box  44  of  the  Single  Administrative  Document 
(‘SAD’) 
the  below  product/origin 
descriptions indicated in the following table. The rate of the definitive countervailing 
duty applicable to the net-free-at-Community-frontier price, before duty, shall be as 
follows: 

the  reference  number  corresponding 

to 

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No 

Product/origin description 

than 

1  Multi-combinational forms of DRAMs originating in 
countries  other 
the  Republic  of  Korea, 
incorporating DRAM chips and/or mounted DRAMs 
originating  in  countries  other  than  the  Republic  of 
Korea  or  originating  in  the  Republic  of  Korea  and 
manufactured by Samsung 

than 

2  Multi-combinational forms of DRAMs originating in 
countries  other 
the  Republic  of  Korea, 
incorporating DRAM chips and/or mounted DRAMs 
the  Republic  of  Korea  and 
originating 
manufactured  by  all  companies  other  than  Samsung 
and  representing  less  than  10%  of  the  net  free-at-
Community-frontier price of the multi-combinational 
form of DRAM 

in 

than 

3  Multi-combinational forms of DRAMs originating in 
countries  other 
the  Republic  of  Korea, 
incorporating DRAM chips and/or mounted DRAMs 
the  Republic  of  Korea  and 
originating 
manufactured  by  all  companies  other  than  Samsung 
and  representing  10%  or  more but  less  than 20% of 
the  net  free-at-Community-frontier  price  of  the 
multi-combinational form of DRAM 

in 

than 

4  Multi-combinational forms of DRAMs originating in 
countries  other 
the  Republic  of  Korea, 
incorporating DRAM chips and/or mounted DRAMs 
the  Republic  of  Korea  and 
originating 
manufactured  by  all  companies  other  than  Samsung 
and  representing  20%  or  more but  less  than 30% of 
the  net  free-at-Community-frontier  price  of  the 
multi-combinational form of DRAM 

in 

than 

5  Multi-combinational forms of DRAMs originating in 
countries  other 
the  Republic  of  Korea, 
incorporating DRAM chips and/or mounted DRAMs 
originating 
the  Republic  of  Korea  and 
manufactured  by  all  companies  other  than  Samsung 
and  representing  30%  or  more but  less  than 40% of 
the  net  free-at-Community-frontier  price  of  the 
multi-combinational form of DRAM 

in 

than 

6  Multi-combinational forms of DRAMs originating in 
countries  other 
the  Republic  of  Korea, 
incorporating DRAM chips and/or mounted DRAMs 
originating 
the  Republic  of  Korea  and 
manufactured  by  all  companies  other  than  Samsung 
and  representing  40%  or  more but  less  than 50% of 
the  net  free-at-Community-frontier  price  of  the 
multi-combinational form of DRAM 

in 

7  Multi-combinational forms of DRAMs originating in 
the  Republic  of  Korea, 
countries  other 
incorporating DRAM chips and/or mounted DRAMs 
the  Republic  of  Korea  and 
originating 

than 

in 

Reference 
number 

Rate of Duty 
(%) 

D010 

0% 

D011 

0% 

D012 

3,4% 

D013 

6,9% 

D014 

10,4% 

D015 

13,9% 

D016 

17,4%’ 

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manufactured  by  all  companies  other  than  Samsung 
and  representing  50%  or  more  of  the  net  free-at-
Community-frontier price of the multi-combinational 
form of DRAM 

5. 

A new Article 1(4) shall be inserted as follows: 

‘4.  With  reference  to  paragraph  3,  the  indication  in  box  44  of  the  SAD  of  the 
reference  number  in  case  of  the  product/origin  description  falling  under  number  1 
shall,  as  such,  be  considered  as  sufficient  supporting  evidence.  For  all  remaining 
product/origin descriptions, the declarant shall submit a statement issued by the last 
manufacturer  certifying  the  origin,  the  manufacturers  and  the  value  of  all 
components  of  the  multi-combinational  form  of  DRAM,  in  conformity  with  the 
requirements  set  in  the  Annex.  This  statement  shall  be  made  on  company-headed 
paper and be validated by a stamp of the company.’ 

6. 

A new Article 1(5) shall be inserted as follows: 

‘5. 
In  case  of  no  indication  of  any  reference  number  in  the  SAD,  as  foreseen  in 
paragraph 3, or if the customs declaration is not accompanied by any statement in the 
cases required in paragraph 4, the multi-combinational form of DRAM shall – unless 
the  contrary  is  proved  -  be  considered  as  originating  in  the  Republic  of  Korea  and 
manufactured by all companies other than Samsung, and the countervailing duty rate 
of 34,8% shall apply. 

In  cases  where  some  of  the  DRAM  chips  and/or  mounted  DRAMs  incorporated  in 
multi-combinational  forms  of  DRAMs  are  not  clearly  marked  and 
their 
manufacturers are not clearly identifiable from the statement required in paragraph 4, 
it should be assumed - unless the contrary is proved – that such DRAM chips and/or 
mounted  DRAMs  are  originating  in  the  Republic  of  Korea  and  have  been 
manufactured  by  companies  subject  to  the  countervailing  duty.  In  such  cases,  the 
countervailing duty rate applicable to multi-combinational forms of DRAMs shall be 
calculated on the basis of the percentage represented by the net free-at-Community-
frontier  price  of  the  DRAM  chips  and/or  mounted  DRAMs  originating  in  the 
Republic  of  Korea  out  of  the  net  free-at-Community-frontier  price  of  the  multi-
combinational forms of DRAM, as established in the table contained in paragraph 3, 
numbers  2  to  7.  Should,  however,  the  value  of  the  aforementioned  DRAM  chips 
and/or mounted DRAMs be such to determine that the multi-combinational forms of 
the 
DRAMs 
countervailing  duty  rate  of  34,8%  shall  apply  to  the  multi-combinational  forms  of 
DRAMs.’  

incorporated  becomes  of  Korean  origin, 

in  which 

they  are 

7. 

A new Article 1(6) shall be inserted as follows: 

‘6. 
For  the  purpose  of  data  verifications  by  Member  State’s  customs  authorities, 
Article 28(1), 28(3), 28(4) and 28(6) of Council Regulation (EC) No 2026/97 shall 
apply mutatis mutandis.’ 

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This Regulation shall enter into force on the 15th day following that of its publication in the 
Official Journal of the European Union. 

Article 2 

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

Done at Brussels,  

For the Council 
The President 

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ANNEX 

Statement accompanying the Single Administrative Document, and referring to imports 
of multi-combinational forms of DRAMs 

N.B.  This  declaration  shall  be  issued  by  the  last  manufacturer  of  the  multi-combinational 
form  of  DRAMs,  made  on  company-headed  paper  and  be  validated  by  a  stamp  of  the 
company. 

1. 

2. 

3. 

4. 

Reference number: [number foreseen in Article 1(4)] 

Name  of  all  manufacturers  involved  in  the  production  of  the  DRAM  chips  and/or 
mounted DRAMs incorporated in the multi-combinational forms of DRAMs: [insert 
full name, address and manufacturing process performed] 

Number and date of commercial invoice: 

General information: 

Multi-combinational form of DRAMs 

Quantity 

Price (Total net 
free-at-
Community 
frontier) 

Origin 

Price of the DRAM chips and/or mounted DRAMs 
manufactured by all companies other than 
Samsung and incorporated in the multi-
combinational form of DRAMs 

Price as a % of the 
total net free-at-
Community frontier 
price of the multi-
combinational form of 
DRAMs  

TARIC additional 
code of the Korean 
manufacturer 

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