Council Regulation (EC) No 1987/2005 of  2 December 2005  imposing a definitive anti-dumping duty and collecting definitively the provisional duty imposed on imports of granular polytetrafluoroethylene (PTFE) originating in Russia and the People’s Republic of China
Date: 2005-12-02
Institutions: Council of the European Union
Subjects: China, Russia, anti-dumping duty, anti-dumping legislation, chemical product, import, originating product

8.12.2005

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Official Journal of the European Union

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I

(Acts whose publication is obligatory)

COUNCIL REGULATION (EC) No 1987/2005

of 2 December 2005

imposing a definitive anti-dumping duty and collecting definitively the provisional duty imposed on
imports of granular polytetrafluoroethylene (PTFE) originating in Russia and the People’s Republic
of China

THE COUNCIL OF THE EUROPEAN UNION,THE COUNCIL OF THE
EUROPEAN UNION,

lation, all
interested parties which requested a hearing
were granted an opportunity to be heard by the
Commission.

Having regard to the Treaty
Community,

establishing the European

Having regard to Council Regulation (EC) No 384/96 of 22
December 1995 on protection against dumped imports from
countries not members of the European Community (1)
(the
basic Regulation) and in particular Articles 9 and 10(2) thereof,

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

(3)

(4)

(5)

Whereas:

The Commission continued to seek and verify all infor-
mation deemed necessary for the definitive findings.

An additional verification visit was carried out at the
premises of the following companies:

— Heroflon (Italy), granular PTFE transformer,

— Fluorseals (Italy), granular PTFE processor.

the essential

All parties were informed of
facts and
considerations on the basis of which it was intended to
recommend the imposition of a definitive anti-dumping
duty and the definitive collection of amounts secured by
way of provisional duty. They were also granted a period
within which
representations
subsequent to this disclosure.

could make

they

(1)

(2)

A. PROCEDURE

1. Provisional Measures

By Regulation (EC) No 862/2005 (2), (provisional Regu-
lation),
anti-
the Commission imposed provisional
dumping duties on imports into the Community of
granular polytetrafluoroethylene (PTFE) originating in
Russia and the People’s Republic of China (PRC).

2. Subsequent Procedure

(7)

Subsequent to the disclosure of the essential facts and
considerations on the basis of which it was decided to
impose provisional anti-dumping duties on imports of
interested
PTFE from Russia and the PRC,
In accordance
parties submitted comments in writing.
with the provision of Article 20(1) of the basic Regu-

several

(1) OJ L 56, 6.3.1996, p. 1. Regulation as last amended by Regulation

(EC) No 461/2004 (OJ L 77, 13.3.2004, p. 12).

(2) OJ L 144, 8.6.2005, p. 11.

(6)

The oral and written arguments submitted by the parties
were considered, and, were deemed appropriate, taken
into account for the definitive findings.

B. PRODUCT CONCERNED AND LIKE PRODUCT

1. Product concerned

The provisional Regulation described the product
concerned as granular polytetrafluoroethylene (PTFE),
containing not more than 3 % of other monomer unit
than tetrafluoroethylene, without fillers,
in the form of
powder or pellets, with the exclusion of micronised
material. The product concerned can also be presented
as raw polymer (reactor bead) in wet or dry form. Further
to comments received by interested parties, it is clarified
that ‘micronised material’ means a fluoropolymer micro-
powder as defined by norm ‘ASTM D5675-04’. The
product concerned is currently classifiable within CN
code ex 3904 61 00.

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(8)

(9)

(10)

association objected

One users’/importers’ organisation (the European Fluoro-
polymer Fair Trade Association or EFFTA) and one
exporters’
to the provisional
conclusions that all granular PTFE constitute a single
It was argued that granular PTFE can be
product.
divided into three product groups based on quality
differences (high/medium/low). It was claimed that each
product group would be used in different applications
not competing with one another in the same market.

Despite quality differences, all granular PTFE types were
found to have the same basic physical, technical and
chemical characteristics, which were neither contested
by EFFTA nor by the exporters’ association. As far as
granular PTFE applications are concerned, it was found
that granular PTFE of a lower quality could be used after
post-treatment in almost all applications, including some
high-end applications (e.g. billets for skiving). In general,
as also admitted by EFFTA, there was an overlapping in
applications for various types and qualities of granular
PTFE and no clear dividing line could thus be established.

It was therefore concluded that, notwithstanding the
different possible product types due to different form,
average particle size, thermo treatment or co-monomer
content, and despite quality differences, all of
them
constituted one single product for the purpose of this
proceeding because all types and qualities had the same
physical characteristics and essentially the same basic
end-uses. In recitals 13, 145 and 147 of the provisional
Regulation it was erroneously mentioned that granular
PTFE would also be contained in anoraks and in the
inner shield of cables and that it is used in textile and
biomedical applications as well as isolation agents. The
definitive findings revealed that granular PTFE is not used
in any of the aforementioned applications.

(11)

Taking into account the abovementioned considerations,
the product definition and the provisional findings set
the provisional Regulation are
out
hereby confirmed.

in recital 14 of

2. Like product

(12) A number of

importers and users reiterated that

the
granular PTFE produced and sold in the Community
market could not be likened to the products imported
from the PRC and Russia. It was argued that the products
imported from the countries subject of the present inves-
tigation, would be of a much lower quality than the

product produced by the Community industry and
would therefore be sold on different markets, thus not
competing with each other. These parties did not,
however,
forward with new information or
evidence in this matter.

come

(13)

It should first be noted that, as outlined in recital 16 of
the provisional Regulation, the investigation has shown
that the Community industry also produced and sold
‘off-spec’ material during the investigation
scrap or
to the same customers as the exporting
period (IP)
producers concerned. On the other hand, the investi-
gation revealed that at
the Russian exporting
least
producers
sold a quality of granular PTFE to the
Community, which was, even without post-treatment,
comparable to the high quality Community grades,
albeit in very limited quantities. Furthermore, even low
quality granular PTFE imported from the countries
concerned could, after post-treatment, be used in a
similar range of applications as the product produced
and sold in the Community market by the Community
industry.

(14)

Considering the above, it was concluded that the product
concerned and the granular PTFE produced and sold in
the Community by the Community industry share the
same physical and technical characteristics and the
same basic end-uses. They were therefore considered to
be alike within the meaning of Article 1(4) of the basic
Regulation.

(15)

In the absence of any other comments in this regard, the
provisional conclusions set out in recital 15 of the provi-
sional Regulation are hereby confirmed.

C. DUMPING

1. People’s Republic of China

1.1. Market economy treatment (MET)

(16)

Following the imposition of provisional measures, the
three Chinese cooperating exporting producers claimed
that they should have been granted MET and reiterated
the arguments they had previously submitted. These
comments were already addressed in recitals 33 to 39
of
it was
considered that the decision to reject MET to the three
companies should be maintained.

the provisional Regulation. Consequently,

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(17)

1.2. Individual treatment (IT)

interference. The

Two exporting producers argued that
they should be
granted IT. One exporter submitted that the Commission
was not entitled to reject IT on the basis of possible State
interference, since Article 9(5) requires that only export
prices and quantities are freely determined.
In this
respect, it should be noted that a company can, by defi-
nition, not be considered to freely determine its export
prices and quantities and conditions and terms of sale, if
the latter can be influenced by the State. Therefore, the
conditions of Article 9(5)(b) of
the basic Regulation
cannot be considered to be met by companies that are
not able to demonstrate that they are not subject to
exporting producer
possible State
concerned has not provided any evidence showing that
the State could neither influence its decisions with regard
to export prices and quantities, and conditions and terms
of sale, nor that possible State interference was not such
as to permit circumvention of
the measures. This is
mainly due to the fact that, as outlined in recital 33 of
the provisional Regulation,
this
company to the State-owned shareholder was unclear
and the Articles of Association were considered unre-
liable. Therefore,
that such State interference
would allegedly not have occurred in the past, would,
even if it were demonstrated, not offer any guarantee
that
in particular
should an individual duty rate be attributed to this
company.

take place in future,

the relationship of

it will not

the fact

(18) Another exporter argued that its shareholding structure,
in particular the fact that it is partly State-owned, did not
as such allow the conclusion that the State interfered in
the setting of prices and other sales terms. First of all, the
claim with any
company did not
substantiate
evidence. On the other hand,
the
State owned the majority of the company’s capital and
furthermore, nominated the General Manager and the
this company.
majority of
Therefore,
is not
fulfilled and IT should therefore be rejected.

it was concluded that Article 9(5)(c)

the Board of Directors of

it was found that

its

(19)

In the absence of any other comments, the findings of
the provisional Regulation, as set out in recital 45 of that
Regulation, are hereby confirmed.

1.3. Analogue country

(20) All

three Chinese

cooperating exporting producers
disagreed with the choice of
the United States of
America (USA) and claimed that Russia should have
been chosen as the analogue country instead. Two of
them reiterated the comments made before the impo-

sition of provisional measures, which have already been
addressed in recitals 47 to 54 of the provisional Regu-
lation.
In the absence of any new information and
evidence, the claims of these exporting producers had
to be rejected.

the different

In this regard,

it must be noted that

(21) Another Chinese exporting producer argued that, due to
the lower economic development of the PRC, production
factors, such as labour costs and overhead expenses,
would be lower and therefore not comparable to the
USA. Nevertheless, as mentioned in recital 54 of the
provisional Regulation,
level of overall
economic development is, in itself, not a relevant factor
when selecting an analogue country. This company also
alleged that as a consequence of the lower economic
development
in China, public services such as water,
power and gas supply would be less expensive than in
the USA.
it is
precisely the aim of Article 2(7)(a) of the basic Regulation
that an analogue country is selected to determine the
normal value on the basis of prices and costs, unbiased
by non-market economy conditions. Thus, a simple
comparison of prices
economy
country or in the country with an economy in transition
with those in the analogue country is as such not mean-
ingful. In any event, no information was submitted which
would have substantiated the alleged differences and
allowed a quantification, or which would have demon-
strated that this exporting producer benefited from any
natural
argument was
therefore rejected. Finally, this exporting producer also
claimed that, due to a simpler production process, the
equipment, as well as the related investments and depre-
ciation rates would be significantly different. However,
the exporter did not submit any information showing
that
its production process was indeed simpler than
that used by the USA producers or which would allow
the Commission services to quantify the effect of such
alleged differences.

in the non-market

advantage. The

comparative

(22)

This exporter also argued that the USA and the Chinese
granular PTFE have a different quality which would result
in different applications and that the choice of the USA
as analogue country was therefore not appropriate. In
this regard it is noted that, as explained in recital 53
of the provisional Regulation, an adjustment was made
for differences of quality, in particular contamination, the
level of which the Chinese exporting producer did not
contest. This argument was therefore also rejected.

(23)

In the absence of any other comments, the findings set
out in recitals 47 to 54 of the provisional Regulation
regarding the choice of
the USA as an appropriate
analogue country are hereby confirmed.

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1.4. Determination of normal value for Chinese exporting

producers not granted MET

(24) One Chinese

argued that

exporting producer

the
for quality differences described in recital
adjustment
53 of the provisional Regulation was insufficient and
that normal value should have been adjusted to the
same extent as the Community industry price when
calculating undercutting and underselling margins, as
explained in recital 98 of the same Regulation.

(25)

It should be noted that while the adjustment
to the
normal value is designed to capture differences between
the like product sold on the market of the analogue
the adjustment
country and the product concerned,
made in the injury analysis takes into consideration
differences between the latter and the like product sold
in the Community. Although the like product sold in the
analogue country and the one sold in the Community
market may be of a similar quality and may have similar
characteristics, differences in the product concerned are
not necessarily identical. Consequently, the adjustments
were made on their own merits and on the basis of the
information and evidence collected during the investi-
gation. The exporting producer did not submit any
evidence showing that
the methodology used by the
Commission in its provisional determinations was unrea-
sonable and that indeed, differences between the product
concerned and the like product produced and sold in the
Community on the one hand and in the analogue
country on the other hand would be identical, nor was
there
available
information or
suggesting that
should be identical.
the claim had to be rejected and the
Consequently,
findings in recital 53 of the provisional Regulation as
regards
for
exporting producers not granted MET are hereby
confirmed.

the adjustments

determination

any other

evidence

normal

value

the

of

1.5. Export price

(26)

In the absence of any comments by the interested parties,
the methodology set out in recital 59 of the provisional
Regulation is hereby confirmed.

1.6. Comparison

(27) One Chinese

argued that

exporting producer

the
for physical differences outlined in recital
adjustment
62 of
the provisional Regulation would not properly
reflect the actual difference in production costs and the
adjustment made should therefore be revised appro-
priately. It should be noted that the adjustment made

the basic Regulation.

the determination of

this methodology was

the provisional dumping
for
the
margin was based on a reasonable estimate of
in accordance
difference in market value in the USA,
It was
with Article 2(10)(a) of
the most
considered that
accurate in order to determine the effect of the difference
in price and price comparability. The Chinese exporting
producer did not quantify its claim, nor did it submit any
information or evidence that the methodology set out by
Article 2(10)(a) of the basic Regulation would not be
adequate to take the physical difference into account.
In the
On this basis,
absence of
findings on
comparison, as set out in recitals 60 to 64 of the provi-
sional Regulation, are hereby confirmed.

the claim had to be rejected.
comments,

any other

the

2. Russia

2.1. Application of the provisions of Article 18 of the basic

Regulation

(28) As mentioned in recitals 69 to 82 of the provisional
Regulation, the determination of dumping at provisional
stage was based on the facts available for both exporting
producers investigated in Russia.

(29)

(30)

(31)

Prior to the imposition of the provisional duties, the two
Russian exporting producers were informed forthwith of
the basis on which it was intended to apply facts
available at the stage of the provisional determination
and were given the opportunity to provide further expla-
nations,
in accordance with Article 18(4) of the basic
Regulation.

The two Russian exporting producers claimed that they
cooperated to the best of their abilities and that the full
facts available was therefore dispropor-
application of
in accordance with Article
tionate. They argued that
the companies’ own
18(3) of
data, although not
in all respects ideal, should have
been used.

the basic Regulation,

submitted
incomplete,
information. Moreover,

In this respect, and as outlined in recitals 70 to 74 of the
provisional Regulation, it is recalled first of all that both
and
companies
company
misleading
refused to submit information for the calculation of the
dumping margin or did not provide such information in
a timely manner thus, it was no longer verifiable. Finally,
a trader
the exporting
producers did not cooperate.

in Russia related to one of

incorrect
one

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(32)

Both companies already admitted the existence of defi-
ciencies in their responses to the questionnaires, as well
as during the on-the-spot verification, but alleged that
these were not such as to cause undue difficulty in
arriving at a reasonably accurate finding. It was claimed
that the deficiencies would only have a minor impact on
the findings and that
supplied by the
companies would, overall, be sufficiently reliable to be
used for the determination of dumping.

the figures

all

the

as of

(33) A re-examination was made of all information submitted
by the two companies in their responses to the ques-
tionnaire and during the on-the-spot verification, as
well
information submitted by the
companies following the disclosure of the provisional
findings. However, none of the companies’ explanations
submitted could alter the provisional conclusions. It is
reiterated that the data provided by the companies in
their questionnaire reply could not be reconciled with
their audited accounts. This was considered a serious
deficiency. Under these circumstances, a reliable indi-
vidual dumping margin cannot be
established and
recourse has to be made to facts available.

2.2. Normal value

(36)

In the absence of any comments by the interested parties,
the methodology set out in recital 76 of the provisional
Regulation is hereby confirmed.

(37)

(38)

2.3. Export price

the calculation of

Both companies claimed that
the
export price was wrongly based on prices, as recorded
for imports falling under the CN code
by Eurostat,
ex 3904 61 00, since apart from the product concerned
this code also includes other products not subject to the
present proceeding.

In this regard, it should be noted that the large majority
imports under the abovementioned CN code falls
of
under the product concerned. Nevertheless, in the provi-
sional determinations, adjustments were made to the data
recorded by Eurostat on the basis of
information
available (estimates of the Community industry). In the
absence of any more reliable information available, this
methodology was maintained for the determination of
the definitive dumping margin.

(34)

it

is

In this regard and as already mentioned in recital 72 of
the provisional Regulation,
recalled that one
company provided significantly misleading information
concerning its company structure which ultimately did
not allow the reconciliation of the figures reported. The
reply of this company was also significantly incomplete
and of low quality. For the other company, while each
deficiency taken separately may not have a major impact
on the dumping calculations, the accumulation of such
deficiencies casts serious doubts on the overall reliability
of the data. Therefore, and for the reasons set out in
recital 71 of the provisional Regulation, available facts
had to be used in accordance with Article 18 of the
basic Regulation. No new evidence was provided which
could alter these findings.

(39) One company claimed that
price,

the

of

fully

in order to establish its
unrelated
two
information
export
importers accounting for more than 80 % of its sales
to the Community during the investigation period
should be used. However, one of these importers did
not
In
during
the data provided by the fully cooperating
addition,
unrelated importer could not be linked with those
provided
concerned.
exporting
Therefore, the data provided did not allow a determi-
nation of the export price on that basis and the claim
had to be rejected.

investigation.

cooperate

producer

the

the

by

(35) Due to the serious deficiencies outlined above and the
impossibility of verifying the information submitted,
it
had to be concluded that data submitted were overall
unreliable and inaccurate. Therefore,
the questionnaire
replies of both companies had to be rejected as a
whole. Consequently, the findings of recitals 70 to 74
and the conclusion in recital 75 of the provisional Regu-
lation, namely that
for both
exporting producers could not be established on the
basis of their own data but had to be based on facts
available in accordance with Article 18 of the basic Regu-
lation, is hereby confirmed.

the dumping margins

(40)

In the absence of any other information, the metho-
dology as outlined in recital 77 of the provisional Regu-
lation was maintained and the
export price was
calculated on the basis of Eurostat data.

2.4. Comparison

(41)

In the absence of any comments by the interested parties,
the findings of recitals 78 and 79 of the provisional
Regulation are hereby confirmed.

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3. Dumping margin

(42)

In the absence of any comments by the interested parties,
the methodology for the calculation of
the dumping
margins as set out in recitals 24, 65 to 68 and 80 to
82 of the provisional Regulation are herewith confirmed.
Considering the above, the definitive dumping margins,
expressed as a percentage of the cif import price at the
Community border, are:

from Russia,

although decreasing in 2002,
trends
remained stable afterwards and even increased slightly
during the IP. Finally, the definitive findings confirmed
that imports of granular PTFE from the PRC and Russia
were competing with each other on the Community
market. Therefore, and in view of
the arguments set
out in recitals 89 to 92 of the provisional Regulation,
there are no reasons to conclude that Russian imports
should be decumulated. The abovementioned argument
was consequently rejected.

Exporting country

Dumping margin

PRC

Russia

99,7 %

36,6 %

D. INJURY

(46)

In the absence of any further comments in this particular
respect, the findings in recitals 88 to 93 of the provi-
sional Regulation are hereby confirmed.

1. Community production, Community industry and

Community consumption

(43)

In the absence of any comments in this particular
respect, the findings in recitals 83 to 87 of the provi-
sional Regulation are hereby confirmed.

3. Imports from the countries concerned

3.1. Volume, market share and prices of the imports concerned

(47)

In the absence of any comments in this particular
respect, the findings in recitals 94 to 96 of the provi-
sional Regulation are hereby confirmed.

(44)

2. Cumulative assessment of

the effects of

the

imports concerned

The two Russian exporting producers reiterated that for
the purpose of assessing injury, imports of granular PTFE
originating in Russia should be decumulated for the
reasons set out in recital 91 of the provisional Regu-
lation. To support their claim, the exporting producers
argued that the decrease in the Community industry’s
profitability from 2002 onwards
coincided with a
decrease of
imports originating in Russia, while in
2001, when imports from Russia were at their highest,
the Community industry enjoyed high profit margins. In
contrast,
imports originating in the PRC increased in
parallel to the Community industry’s decline in profit
margin. The exporter concluded that on this basis
material injury could not have been caused by imports
originating in Russia and that cumulation was therefore
not warranted.

(45)

It is noted that, as set out in recital 90 of the provisional
Regulation, price trends from both Russia and the PRC,
are similar. They have a decreasing trend throughout the
entire IP and dropped each year by a significant
percentage. Furthermore, both imports originating in
Russia and those originating in the PRC undercut the
Community industry’s prices substantially throughout
the period from 1 January 2001 to the end of the IP
(period considered). In addition, it is noted that import

3.2. Price undercutting

In particular,

(48) One Chinese exporting producer expressed its concern
with regard to the provisional determination of
the
post-importation costs when calculating the price of
the Community industry.
this exporter
alleged that such cost would be higher than the one
used in the provisional calculations, without however
providing any supporting evidence in this regard. The
determination of post-importation costs at provisional
stage was based on actual data provided by the two
these
cooperating importers. The
importers was subject to verification. The information
of
the other importer, although not verified, was in
line with the verified data of the first importer and was
therefore considered sufficiently reliable. It is therefore
the data provided by the importers
considered that
were more reliable than the estimates made by the
Chinese exporting producers, which were furthermore
not substantiated by any evidence. This claim had conse-
quently to be rejected.

reply of one of

(49) One Chinese exporting producer pointed to a clerical
import
for
error when calculating the
duties. Accordingly,
for import duties
the adjustment
for all Chinese exporting producers was corrected in
accordance with the applicable duty rate during the IP.

adjustment

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(50) As announced in recital 98 of the provisional Regulation,
it was examined whether the adjustment provisionally
granted for quality differences between the like product
sold by the Community industry and the product
concerned imported from Russia and the PRC was appro-
priate.

In this regard, the Community industry submitted that
post-treatment would only be necessary for a limited
number of the imported product types,
i.e. the reactor
bead. The Community industry further argued that in
order to produce pre-sintered material,
their products
would also need further processing, and therefore no
adjustment
to the import price would be necessary.
Finally,
information was submitted regarding sales of
types produced by the Russian
high quality product
exporting producers, which did not need any post-
treatment.

It was found that certain granular PTFE types produced
by Russian exporting producers indeed reached higher
quality standards and could thus be used without any
further treatment. However,
types were
only sold in negligible quantities during the IP and
mainly for testing purposes. Thus, on the basis of the
cooperating users,
information available
such higher quality granular PTFE from
imports of
Russia constituted only 1,4 % of
imports
from that country.

these product

their total

from the

(51)

(52)

(53)

the product,
the particle size and the impurity of
excluding, however, other key quality parameters, such
as tensile strength and elongation, which would have a
considerable impact on the intrinsic quality of
the
Russian granular PTFE and consequently on the quality
of the semi-finished product. In order to substantiate this
claim,
the abovementioned importer submitted infor-
mation on testing results which allegedly showed
quality differences between granular PTFE produced by
Community producers and post-treated granular PTFE
imported from Russia. On this basis,
it was claimed
that
the adjustment should exceed the mere cost of
post-treatment.

(55) However, the investigation could not confirm these alle-
gations. It was found that the information submitted by
the importer concerning the testing results was not
representative, but rather anecdotal, since it singled out
only one production lot. Even within this lot, all tested
granular PTFE fulfilled the required specifications in order
to comply with the norm, despite variations in their
technical
evidence
submitted was not considered conclusive. In any case,
based on the information submitted by the abovemen-
tioned Russian exporting producer and the importer, the
claimed quality difference
could not be quantified.
Therefore,
it is confirmed that granular PTFE imported
from this exporting producer after post-treatment was of
a similar quality as the granular PTFE produced and sold
by the Community industry on the Community market
and could be used in a wide-range of similar applications.

specifications.

Therefore,

the

after post-treatment. Thus,

It was further found that all other imported granular
PTFE grades needed post-treatment, which consisted
mainly in heating and further milling. This process has
to be distinguished from the processing needed for the
production of pre-sintered PTFE, which is a specific
process
adjustment
granted at provisional stage correctly reflects the demon-
strated quality differences between the like product
manufactured by the Community industry and the
product concerned and does not concern the additional
the
processing costs of granular PTFE required for
production of pre-sintered grades. The Community
industry’s arguments had therefore to be rejected.

the

(56) Given the above,

the adjustment provisionally made
when calculating the undercutting margin was found to
be appropriate. However, the adjustment was corrected
on the basis of the verified information of two users,
these costs.
which allowed a precise calculation of
Thus,
the
purchase price of the users/importers concerned.

the adjustment amounted to 36,7 % of

(57)

Taken into consideration the abovementioned corrections
and in the absence of any other comments, recitals 97 to
98 of the provisional Regulation are hereby confirmed.

(54) On the other hand, one Russian exporting producer and
one importer of granular PTFE from Russia claimed that
even after post-treatment the granular PTFE exported by
this exporting producer would still be of a lower quality
than the granular PTFE produced and sold by the
Community industry on the Community market. The
exporting producer
the post-treatment
added that
would only balance quality differences with regard to

(58) On the basis of the above, the comparison on a per-
model basis showed that the product concerned origi-
sold in the
nating in the PRC and Russia was
Community at prices which undercut
the
those of
Community industry by 20,5 and 13,5 % respectively
during the IP, when expressed as a percentage of the
Community industry’s prices.

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3.3. Situation of the Community industry and conclusion on

injury

volume and capacity utilisation, while consumption in
the Community was decreasing, which would not point
to an injurious situation of the Community industry.

3.3.1. G e n e r a l r e m a r k s

(59)

Certain interested parties pointed to the positive trends of
certain injury factors and claimed that it would not be
sufficient that other injury indicators such as sales prices
and profitability showed negative trends to conclude that
injury had been suffered by the Community
material
industry.

(60)

It should first be noted that Article 3(5) of the basic
Regulation provides that while the impact of dumped
imports on the Community industry shall be examined
on the basis of an evaluation of all relevant economic
factors and indices, none of these factors on its own or
can necessarily give decisive
together with others
guidance.
injury
It
factors show a negative trend in order to conclude that
the Community industry suffered material injury.

is therefore not required that all

(64)

(65)

(61) On this basis,

it

that

these

overall

in order

injury,
situation

in a broader context,

to determine whether

certain injury indicators,

the
Community industry suffered material
is
be
financial
its
important
in case of the positive development
considered. Thus,
should not be
of
considered in isolation but
i.e.
together with the development of other injury indicators
in order to make meaningful conclusions. In the present
case and as outlined in recital 117 of the provisional
Regulation, the positive trend of certain injury indicators
has to be seen in the context of the overall significant
negative effects of the imports under consideration on
the performance of the Community industry and the
latter’s reaction to this. The overall negative picture of
the Community industry’s
in particular
translated in a decline of its sales prices and profitability.

situation is

In fact, the decrease in consumption (by 12 %) was only
felt in 2002, when the Community industry’s production
volume decreased in line by 13 %, which is also
translated into a decrease in the capacity utilisation
same year. As a consequence and as
during the
outlined in recital 102 of
the provisional Regulation,
the Community industry had to lower its sales prices,
thereby increasing its sales volume in order to be able
to compete with the dumped imports. Nevertheless, even
the sales volume of the Community industry decreased
slightly during 2002.

in

of

to

relation

development

Furthermore, the development of the production volume
should also be seen in the more global context than
solely
the
the
Community consumption. Thus, as mentioned in recital
134 of the provisional Regulation, export sales of the
Community industry were slightly increasing, which
had also an impact on production figures. Furthermore,
the increase in the production volume of granular PTFE
is partly explained by the fact that some Community
producers increased the internal use of granular PTFE
for example, compounds and
for the production of,
micronised grades.
increase of
production volume and production capacity during the
period considered is also part of
the Community
industry’s attempt to react to the dumped imports by
trying to increase sales volume, albeit at the expense of
sales prices and profitability.

the overall

Finally,

(66)

Therefore, the findings set out in recitals 101 and 102 of
the provisional Regulation are hereby confirmed.

(62)

It is therefore considered that the approach taken for the
provisional determinations was reasonable and in line
with the basic Regulation and is therefore maintained
for the definitive findings.

(67)

3.3.2. P r o d u c t i o n ,

p r o d u c t i o n

c a p a c i t y

a n d c a p a c i t y u t i l i s a t i o n

(63)

Some interested parties argued that
the Community
industry was able to increase its production capacity,

3.3.3. S a l e s v o l u m e a n d m a r k e t s h a r e

Likewise, some interested parties argued that the increase
in sales volume and market share,
in particular with a
parallel decrease in demand, would clearly indicate that
the Community industry did not suffer material injury.
The Russian exporting producer also argued that such an
increase
explained by the
could not be
Community industry’s strategy to lower its sales prices
when faced with low-priced imports. In this context, the
development of the Community industry’s sales volume
was compared to that of
the Russian imports which
allegedly showed a downward trend despite decreasing
import prices.

in sales

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(68) However,

share

it was found that

the Russian imports

from 2001 to 2002 significantly,

the analysis of Russian
import data showed a slightly different picture. Thus,
from Russia
although imports
and market
declined
they
dropped only marginally between 2002 and 2003 and
even increased slightly during the IP. In contrast, selling
prices of
showed a constant
downward trend during the entire period considered. In
parallel, Chinese import prices declined to a higher extent
and sales volume and market shares of these imports
increased significantly during the same period. This
indicates that Russian exporters faced with the low-
priced Chinese imports on the Community market
were, as the Community industry, obliged to lower
their import prices even further to regain their market
share in the Community. Moreover, as imports from
Russia and the PRC have been cumulated,
it is more
appropriate to carry out this analysis not separately for
each exporting country concerned, but together. In this
respect, it is recalled that the market share of the imports
remained continuously very high and their prices
dropped dramatically and significantly undercut
those
of the Community industry. Therefore, the argument of
the Russian exporting producer had to be rejected.

(69)

the development of

is therefore reiterated that

the
It
Community industry’s sales volume and market share
has to be seen in correlation with the parallel decrease
in sales value and unit prices due to the dumped imports
and the consequent significant negative impact on the
Community industry’s profitability. As mentioned in
recital 61 of this Regulation, in order to reach a mean-
ingful conclusion on the overall financial situation of the
Community industry, the positive development of these
indicators should not be considered in isolation but
together with the development of the remaining injury
indicators.

percentage points between 2002 and 2003 and then
decreased again by 17 percentage points in the IP.
Moreover,
it should also be noted that the decrease in
stocks between 2003 and the IP only amounted to 216
tons which corresponds to 4,3 % of the sales volume
of the Community industry in 2003 and 3,9 % during
the IP.

(73)

(74)

goods

dispatch

awaiting

In any event, the Community industry produced granular
PTFE mainly to order and products kept in stock are
usually
customers.
Therefore, the increase in stock in 2003 is rather due
to a delay in delivery and cannot be seen as a meaningful
injury indicator because it has no impact as such on the
Community industry’s financial situation. Therefore,
in
this case the development of stock was not considered
as a meaningful injury indicator.

to

to

because

industry

the Community

Some interested parties also argued that the increase in
stock in 2003, namely the year prior to the IP, caused
injury
the
Community industry would have been forced to sell
this increased stock at lower prices during the IP. As
already mentioned in recital 73, production was made
to order and therefore, the increase in stock in 2003 is
likely due to a delay in delivery, whereas customers and
prices were already determined. In any case, the increase
in stocks of 283 tons in 2003 cannot be considered as
significant as it only represents 5,6 % of the sales volume
of that year. It was therefore concluded that this increase
in stock prior to the IP could not cause the material
injury suffered by the Community industry.

(70)

In the absence of any other comments in this particular
regard, the findings set out in recitals 103 and 104 of
the provisional Regulation are hereby confirmed.

3.3.4. S t o c k s

(71) One Chinese and the two Russian exporting producers
also argued that the stocks of the Community industry
decreased significantly between 2003 and the IP, which
would indicate that no material injury was suffered.

(75)

This claim had therefore to be rejected and the findings
of recital 105 of the provisional Regulation are hereby
confirmed.

3.3.5. S a l e s p r i c e s

(76)

The same exporting producers argued that the negative
trend in the Community’s sales prices would not be a
meaningful injury indicator since sales prices of granular
PTFE have decreased globally as a consequence of market
forces. One exporting producer also questioned the
calculations without, however,
correctness of
providing any further detail in how far the calculations
would not be correct.

the

(72)

It
is noted that stock movements during the period
considered were not significant and did not show a
Indeed, while stocks decreased by 13 %
clear
increased by 23
they
between 2001 and 2002,

trend.

(77) As far as the calculation of the Community industry’s
sales prices is concerned, no error was detected in the
provisional calculations which are therefore confirmed.

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(78)

It

is

reiterated that

in the Community
sales prices
It
dropped significantly during the period considered
which had a considerable impact on the Community
industry’s profitability.
these
were considered as key factors in the injury determi-
nation, due to their direct impact on the Community
industry’s financial situation.
is therefore confirmed
that prices are a very meaningful
injury indicator in
this investigation and the exporting producer’s claim in
this respect had to be rejected.

is also confirmed that

It

are

group cash pooling systems, the ability to raise capital
was not a meaningful
injury indicator, as it would
normally not be affected, even if some producers of
such larger groups
in a particularly injurious
situation. The Chinese exporting producer did not
explain in how far it did not agree to these conclusions,
nor did it support its statement with any other expla-
nations. The claim therefore had to be rejected and the
findings of recitals 108 and 109 of the provisional Regu-
lation are hereby confirmed.

(79) More specifically as far as the argument of the alleged
global price decrease is concerned, no factors were found
which would point,
reductions
for example,
underlying such price decrease. It is therefore confirmed
that prices are a very meaningful injury indicator in this
investigation and the exporting producer’s claim in this
respect had to be rejected in the context of the injury
analysis. The remainder of this argument is more linked
link and will therefore be
to the question of a causal
addressed below in recitals 106 and 107.

to cost

3.3.8. P r o f i t a b i l i t y ,

r e t u r n

o n

i n v e s t -

m e n t s a n d c a s h f l o w

(84)

Some exporting producers also observed that there has
been an increase in the Community industry’s profit-
ability between 2003 and the IP, which would not
have been considered in the provisional findings.

(80)

In the absence of any other comment in this particular
regard,
the provisional
Regulation are hereby confirmed.

the findings of recital 106 of

(85)

3.3.6. G r o w t h

(81)

It was argued that the provisional determinations failed
to explain the growth of the Community industry,
in
particular in comparison to the shrinking Community
consumption for
the
growth of the Community industry was determined by
the development of its market share, reference is made to
recital 103 of the provisional Regulation and to recitals
67 and 69 of this Regulation.

the period considered. Since

This claim has to be rejected, given that the development
of the Community industry’s profitability over the entire
period considered was analysed in the provisional Regu-
lation. Thus,
the increase in the profitability between
2003 and the IP could not reverse the conclusion of
the overall significant decrease of profitability between
2001 and the IP, namely by 9,2 percentage points. The
profitability during the IP was only slightly above break
i.e. at 0,1 %, and would have been even lower
even,
should the Community industry have maintained its
in which case it would have suffered loss of
prices,
therefore
market
concluded that
clear
negative trend during the period considered.

and sales volume.
injury factor

It was
showed a

share

this

(86)

In the absence of any other comments in this particular
regard, the findings of recitals 110 and 111 of the provi-
sional Regulation are hereby confirmed.

3.3.7. I n v e s t m e n t s
c a p i t a l

a n d

a b i l i t y

t o

r a i s e

(82) One Chinese exporting producer objected to the provi-
sional conclusions that the ability to raise capital was not
a meaningful injury indicator.

(87)

(83) As outlined in recital 109 of the provisional Regulation,
it was found that, since the Community producers are
part of larger groups and therefore financed via intra-

3.3.9. E m p l o y m e n t a n d p r o d u c t i v i t y

The Chinese as well as
the two Russian exporting
producers reiterated their arguments on the development
of employment and productivity, suggesting that these
factors would not point
In the
absence of any new information in this regard, the provi-
sional conclusions as set out in recital 112 of the provi-
sional Regulation are maintained.

to material

injury.

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Official Journal of the European Union

L 320/11

(88)

(89)

3.3.10. I n c r e a s e i n t h e C o m m u n i t y

i n d u s t r y ’ s e x p o r t s

the Community

Finally, the abovementioned exporting producers argued
export
that
performance during the period considered would show
that it did not suffer material injury.

industry’s

increasing

In this context, it should be clarified that recital 134 of
the provisional Regulation erroneously indicated that the
increase in exports was 3 % during the period considered.
Correctly, exports of the Community industry increased
by 54 %. However, as correctly indicated in the same
these increased
recital of
the provisional Regulation,
exports constituted only 12,7 % of
the Community
industry’s total sales volume during the IP. Thus,
it is
confirmed that in absolute terms, the increase was not
significant
roughly 250 tons). Therefore,
although increasing, export sales still represented only a
small part of the Community industry’s total sales. On
this basis, it was not considered as an indication that the
Community industry was in good health.

(namely

3.3.11. W a g e s

(90)

In the absence of any comment in this particular regard,
the findings in recital 113 of the provisional Regulation
are hereby confirmed.

3.3.12. M a g n i t u d e o f

t h e d u m p i n g m a r g i n

(91)

In the absence of any comment in this particular regard,
the findings in recital 114 of the provisional Regulation
are hereby confirmed.

3.3.13. R e c o v e r y f r o m p a s t d u m p i n g

(92)

In the absence of any comment in this particular regard,
the findings in recital 116 of the provisional Regulation
are hereby confirmed.

3.3.14. C o n c l u s i o n s o n i n j u r y

(93) As far as the arguments of certain interested parties
which were based on information submitted in the
complaint are concerned, it should be noted that provi-
sional
the
Community producers during the IP.

findings were based on verified data of

it was concluded that

(94) On this basis, despite the positive trend of some injury
financial
factors,
situation of
the Community industry has significantly
declined during the period considered and that it had
suffered material injury during the IP.

the overall

(95)

Therefore, the findings set out in recitals 101 to 120 of
the provisional Regulation concerning the situation of
the Community industry and the conclusion on injury
are hereby confirmed.

E. CAUSATION

1. Effects on dumped imports

(96)

In the absence of any comments in this particular
respect, the findings in recitals 122 to 126 of the provi-
sional Regulation are hereby confirmed.

2. Effects of other factors

2.1. Development of consumption and demand

(97)

rather

Some interested parties reiterated that
the decline in
consumption and demand on the Community market
were price driving factors and have to be seen as the
main cause for the decline of prices and profitability of
than the dumped
the Community industry,
imports. These parties did not, however, provide any
new information or evidence but simply repeated their
claims made prior
to the imposition of provisional
duties. It was also argued that a comparison between
the decrease in consumption and the decrease of the
Community market value as in recital 127 of the provi-
sional Regulation is irrelevant since sales prices do not
only depend on the development of consumption and
demand but also on supply.

distorted

(98) While it is not disputed that under normal competitive
conditions prices are the result of supply and demand, it
is recalled that in this case normal market conditions
uncompetitive
i.e.
were
behaviour,
investigation revealed
the
dumping practices. Thus,
significant dumping
exporting producers
from all
during the IP and significant undercutting throughout
the entire period considered, which caused high price
pressure on the Community industry.

by

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imports

from other

import prices of Russia

(99) As already highlighted in recital 129 of the provisional
Regulation,
and the PRC
decreased to a significantly higher degree than the
Community consumption during the
same period.
import prices from the countries under
Furthermore,
consideration continued to decrease significantly, while
consumption remained relatively stable
from 2002
onwards and even increased slightly. At the same time,
sales prices of
third countries
decreased to a much lesser degree than the import
prices from Russia and the PRC. The direct correlation
between
the
in
Community industry’s prices could therefore not be
established and it was concluded that the development
of consumption could not have such an impact that the
injury resulting from the dumped imports could no
the dumped
longer be classified as material.
share (about
imports
at very low prices.
35 %)
Compared with this,
the decrease in
consumption, which moreover only occurred until
is only fairly small. Moreover, the Community
2002,
industry did not
lose any economies of scale as a
result of reduced consumption.

Indeed,
represent a significant market

and have been made

the effect of

consumption

decrease

and

the

(100) This imbalance between the drop in prices and the
decrease in consumption is also evidenced by the fact
that the decrease in consumption was neither in line
with the decrease of the Community market value of
comparison between
granular PTFE. Therefore,
market value and consumption was a valid, albeit not
the only indicator with which to assess whether the
price decline of the Community industry was due to
the dumped imports.

the

mainly translated into a loss of market share, rather
than into a loss in profitability as in the case of the
Community industry. On this basis, it was alleged that
one and the same factor, i.e. the dumped imports could
not have had such adverse effects on the Community
producers’
complainants or non-
it
complainants. Consequently,
the
material
injury suffered by the Community producers
must have been caused by other factors.

it was claimed that

situation, be

(104) This argument had to be rejected. As mentioned in recital
103 of the provisional Regulation, producers, when faced
with low-priced imports, have the choice to either
maintain their sales prices at the expense of a negative
development of their sales volume and market share, or
to lower their sales prices in order to preserve, as far as
possible, economies of scale and to defend their position
in the market. It is therefore not unusual that different
producers opt for different strategies and that the injury
suffered by these producers is translated into the negative
development of either their market share or their sales
prices or a combination of both and a consequent loss of
the
their profitability. Given the important dumping,
substantial import volume and market shares as well as
the significant undercutting and the dramatic drop in
prices of the dumped imports,
it can be concluded, in
the absence of any further causes that the dumping is at
the origin of a negative situation such as the one
experienced by the Community industry.

(101)

In the absence of any other comment in this particular
regard, the findings in recitals 127 to 129 of the provi-
sional Regulation are hereby confirmed.

(105)

In the absence of any other comments in this particular
regard,
the provisional
Regulation are hereby confirmed.

the findings in recital 133 of

2.2. Imports originating in third countries other than Russia

and the PRC

(102)

In the absence of any comments in this particular regard,
the findings in recital 130 of the provisional Regulation
are hereby confirmed.

(106)

2.3. Performance of non-complainant Community producers

(103)

It was
non-complaining
Community producers suffered injury, such injury was

that while

argued

the

2.4. Worldwide price development, economic

recession and

market shrinkage

It was claimed that on the basis of a decreasing trend of
import prices as recorded by Eurostat and, in particular,
import prices of the USA and Switzerland, granular PTFE
prices had dropped in general in the entire Community
market. This downward trend in prices would also be
is a
due to the fact
the granular PTFE market
shrinking market,
i.e. demand and consumption is
decreasing. Therefore, the decline of the sales prices of
the Community industry is rather due to this general
downward trend than to the dumped imports from the
countries concerned.

that

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Official Journal of the European Union

L 320/13

(107)

(108)

It should be noted that an analysis of import prices, as
recorded by Eurostat, in general, and from Switzerland
these were
and the USA in particular, revealed that
largely above the import price level of
the PRC and
the Community industry.
Russia, as well as those of
Likewise,
non-complainant
of
the
Community producers were above the price level of
it was concluded
the Community industry. Therefore,
that
non-complainant
the
and
countries
Community producers did not exert a competitive
pressure on prices which could be regarded as a
significant source of injury.

prices

third

the

It is further noted that as mentioned above, although
Community consumption was decreased significantly
from 2001 to 2002, it remained fairly stable afterwards
this increasing
and even increased slightly. Moreover,
the
trend was confirmed after the IP. Consequently,
granular PTFE market
a
shrinking market.

considered as

cannot be

(112)

allegation,

the production cost of

It should first be noted that, in contrast to this exporting
producers’
the
Community decreased during the period considered,
which was therefore not considered as a cause for the
loss of the Community industry’s profitability. While it is
true that the Community industry was able to keep its
market position and even increase its market share, this
was at the expense of its profitability. It is recalled that
the imports under consideration significantly undercut
the Community industry’s prices throughout the period
considered, which could not be outweighed by the
Community industry’s increase in market share.

(113) On the basis of the above, it was concluded that, since
industry had efficient production
the Community
processes and decreasing production costs, the material
injury suffered by the Community industry was not self-
inflicted. The findings of recital 135 of the provisional
Regulation are thereby confirmed.

(109) On the basis of the above,

it was concluded that the
general economic downward trend during the period
considered did not break the causal
link between the
dumped imports from the PRC and Russia and the
material injury suffered by the Community industry.

2.5. Efficiency of the Community industry

2.6. Captive sales

(114) Two Russian exporting producers claimed that captive
sales of granular PTFE of at
two Community
producers had increased significantly during the period
considered. It was argued that, given that these sales were
usually unprofitable, the increase in captive sales should
be considered as a possible cause for the injury suffered
by the Community industry.

least

(110) Some cooperating exporters stated that the provisional
conclusion in recital 135 of the provisional Regulation,
i.e. that the Community industry’s cost of production
was decreasing was not in line with the data submitted
in the complaint, which suggested an increase in the
Community industry’s unit
cost during the period
considered. They claimed that it should have been inves-
tigated whether or not this increase in costs caused the
it should be
material
noted that the conclusion of recital 135 in the provi-
sional Regulation was based on data which were verified
the
during the different on-the-spot
premises of
these
claims were rejected.

the European producers. Therefore,

investigations at

In this respect,

injury suffered.

(115)

(111) Another exporting producer claimed that the Community
industry lowered its sales prices to unnecessary low
levels, which would be evidenced by the fact that the
Community industry increased sales volume and gained
(instead of merely maintained) market share during the
period considered. Furthermore,
it was alleged that the
loss in profitability was rather due to an increase of unit
costs, as a consequence of low capacity utilisation rates
and an increase in wages, than to the imports under
consideration.

In this regard, the investigation revealed that captive sales
constituted only
the Community
around 5 % of
industry’s total production volume during the IP. Given
these low quantities,
it was concluded that, even if
unprofitable, captive sales could not break the causal
link between the dumped imports from the PRC and
Russia
the
and
Community industry.

the material

suffered by

injury

2.7. No competition between granular PTFE imported from
Russia and the PRC and the PTFE produced and sold
by the Community industry

(116) One exporting producer claimed that since the granular
PTFE imported from the countries concerned would be
of an overall lower quality and would not compete with
the product sold by the Community industry in the
Community market,
the
Community industry cannot have been caused by the
imports under consideration.

suffered

injury

any

by

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Official Journal of the European Union

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(117)

In this respect, it is recalled that in recitals 12 to 14 of
this Regulation it was concluded that despite different
possible product types, including quality differences, the
granular PTFE produced by the Community industry and
the product concerned imported from the countries
concerned have the same physical characteristics and
essentially the same basic end-uses. As
in
recitals 16, 90 and 92 of the provisional Regulation
and in recital 10 of this Regulation, the investigation
imported product types are in
also confirmed that all
competition with those produced and sold by the
Community
industry on the Community market.
Therefore, the above claim had to be rejected.

set out

(121) As

far as

imports

imports

from other

from Russia and the PRC are
concerned, it must be noted that they were significantly
dumped,
i.e. reaching dumping margins of 36,6 % for
Russia and almost 100 % for the PRC. On the other
the
hand,
the
Community
representing
Community consumption were made at
significantly
higher prices than those from Russia and the PRC,
despite the depreciation of the USD. Also, the under-
consideration was
cutting of
substantial throughout the whole period and exceeded
by far the depreciation rate of
the
euro. This claim is therefore rejected.

into
25 % of

the USD against

countries

imports

roughly

under

the

2.8. Exports by the Community industry

2.10. Conclusion on causation

(118) As mentioned in recital 89 of

this Regulation,

the
increase of export sales from the Community industry
was in fact 54 %. However,
the main conclusions in
recital 134 of the provisional Regulation, i.e. that these
increased exports constituted only a small part of the
Community industry’s total sales (namely 12,7 % during
the IP) are confirmed. Therefore, and in the absence of
the
any other comments
findings in recital 134 of the provisional Regulation are
hereby confirmed.

in this particular

regard,

2.9. Exchange rate fluctuations

(119) Some interested parties argued that the depreciation of
the United States dollar (USD) against the euro would
have caused the injury suffered by the Community
industry. It was claimed that: (i) the depreciation of the
USD would have reduced the Community industry’s
export sales to the United States; and (ii) increased the
competitiveness of the Russian and Chinese imports.

(120) As far as the export sales of the Community industry are
concerned, these parties did not provide any underlying
evidence but based their statement on mere assumptions.
They did not, in particular, specify whether export sales
of the Community industry would have allegedly been
reduced in volume or in value or in both. In any case, as
already concluded in recital 118 of this Regulation, the
Community industry export sales increased by 54 %
during the period considered. As indicated in recital
134 of
the profit margin
realised by the Community industry on these export
sales was higher than the one realised on sales in the
Community market. Therefore, the export sales devel-
the Community industry could not be
opment of
considered to have
impact on the
any negative
situation of the Community industry.

the provisional Regulation,

(122) Based on the abovementioned considerations and other
elements contained in recitals 121 to 138 of the provi-
sional Regulation, it is concluded that dumped imports
from Russia and the PRC have caused material injury to
the Community industry within the meaning of Article
3(6) of the basic Regulation.

F. COMMUNITY INTEREST

1. Financial impact on users

(123) Several users reiterated their main concern that the impo-
sition of definitive measures would have a serious adverse
impact on their financial situation since they would not
be able to pass on the expected increase in costs resulting
from the imposition of anti-dumping measures to their
customers.

(124)

In this regard, subsequent to provisional disclosure, five
users/processors not cooperating so far were contacted
and invited to fill
in a questionnaire. These users/pro-
cessors who only requested a questionnaire after impo-
sition of provisional measures were previously unknown
It was found that a
to the Community institutions.
number of these users were importing the majority of
the granular PTFE used in their production/processing
process from the countries under consideration. These
users represented a large part of the total imports from
Russia and the PRC, as well as the total Community
consumption. They alleged that anti-dumping measures
would have a significant impact on their profitability.
Under these circumstances and given the low number
of users cooperating prior to the imposition of provi-
sional measures, as well as the alleged impact of the
imposition of anti-dumping measures, it was considered
warranted to accept these replies, albeit submitted at a
late stage of the investigation, in order to have findings
as representative as possible.

8.12.2005

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Official Journal of the European Union

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(125) Four users

and

producing

semi-finished

replied to the questionnaire

(one only
these users was a transformer of
partially). One of
granular PTFE, with part of
its production directly
competing with the Community producers on the
granular PTFE market, while the other users were
processors
finished
products, by using granular PTFE directly in their
production process. The users already cooperating prior
to the imposition of provisional measures and the ones
coming forward after imposition of provisional duties
were also invited to submit additional
information
regarding their cost of production, with a view to
complementing the data used for
the provisional
findings and to allow a detailed, in-depth analysis of all
aspects of the situation of different users, in particular to
calculate
anti-dumping
measures on their profitability. However, only four
companies
In
summary, a total of seven users cooperated, representing
67,8 % of total
imports from the countries concerned
and 41,3 % of the total Community consumption.

the precise

impact of

additional

to this

request.

replied

the

it was found that there
absorb price increases. Finally,
was very little competition in the market of semi-
finished and finished products produced from granular
PTFE from third countries during the IP, which also
indicates that price increases would likely be passed on
to the final customers.
the semi-finished and
Indeed,
finished products market is dominated by Community
processors, rather than imported products, which will
all be equally subject
to the anti-dumping duties.
is expected that a price increase will
it
Therefore,
equally affect all Community operators concerned and
no price pressure is expected from imported products.
For these reasons, it is concluded that users will in all
likelihood be able to pass on a considerable part of the
cost increase to their customers, so that the estimated
impact of anti-dumping measures on their profitability
should,
in reality, be much more limited than in the
worst case scenario.

(126) The additional investigation revealed that the impact of
definitive anti-dumping duties on users would vary
imported
significantly depending on the quantity of
granular PTFE used in their production processes.
In
this regard, the calculations were made on the basis of
the assumption that none of the users would be able to
pass the price increase on to their customers.
In this
hypothetical worst case scenario,
for two companies,
sourcing between 70 and 80 % of granular PTFE from
the countries under consideration,
the
measures on their profitability was estimated to be up
to 7,5 %. For the remaining cooperating users, importing
less than 30 % of their raw material from the countries
under consideration, the impact, under the assumption
that the price increase would not even be partly passed
on to their customers, was estimated at a maximum
of 2,7 %.

the impact of

(128) Secondly,

the price
it should be noted that, even if
increase could not be partly passed on, which is not a
realistic hypothesis, the impact on the profitability of the
above four cooperating users would not appear to be
disproportionate. Two of the users would still be prof-
itable, even in that of worst case scenario. One of the
cooperating producers, for which the estimated impact of
any anti-dumping measure would be slightly more than
1 %, already realised significant
losses during the IP,
which were not linked to the anti-dumping measures.
Any price increase due to anti-dumping duties would
impact on its
therefore not have
the last user had a
business performance. Finally,
is
significant gross margin,
therefore expected that
least partly
absorb any price increase due to the imposition of
anti-dumping duties.

i.e. over 30 % and it

it can itself, at

considerable

a

(127)

of

of

the

imposition

In that respect,

it was considered that

It should be noted, however, that the investigation also
confirmed that price increases in the Community, as a
consequence
anti-dumping
measures, will very likely be passed on to the final
customer.
the
high price pressure in the Community was mainly due
to the low-priced imports from the PRC and Russia. It is
therefore expected that with the imposition of anti-
dumping measures, price levels of granular PTFE in the
Community will generally increase. The investigation also
revealed that downstream products were partly resold via
from high margins, which
distributors
to
indicates that

those distributors have the potential

benefiting

(129) As mentioned in recital 125 of this Regulation, the above
findings reflect the situation of users representing almost
70 % of the total imports from the countries concerned
and roughly 40 % of the Community consumption. The
investigation covered also different types of users,
i.e.
representing different industrial sectors, using granular
PTFE either directly or in semi-finished products, some
importing high quantities from the countries concerned,
others only limited quantities. It was therefore considered
the above findings could be regarded as largely
that
representative.
as
mentioned in recital 147 of the provisional Regulation,
the impact of the anti-dumping duties on certain users is
negligible due to the fact that granular PTFE constitutes a
rather low proportion of their overall costs.

also be noted that,

should

It

L 320/16

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Official Journal of the European Union

8.12.2005

(130) Furthermore, it should be noted that all cooperating users
have a significant business outside the Community.
Indeed, 24,6 % of the users’ sales volume is exported
outside the Community. This implies that the inward
processing regime would allow these users to claim
back or to avoid paying the anti-dumping duties levied
on the imported granular PTFE. Consequently,
this
segment of the users’ business will not be affected by
the measures.

for

shifting the production of

semi-
an incentive
finished and finished products to these countries where
the granular PTFE was available at cheaper prices. It is
noted that according to some operators in the market,
imports of semi-finished products from the countries
concerned indeed appeared to have an increasing trend.
There is, however, no evidence available suggesting that
the quality of the products imported is comparable to
the products manufactured and sold on the
that of
there would therefore
Community market and that
indeed be a higher competition and a risk of increasing
imports of semi-finished and finished products.

it should also be noted that

(131) Finally, when considering the possible effects of measures
their current
on users,
financial situation is partly due to the unfair competition
resulting from the existence of dumped imports. This
should be taken into account, when balancing the
possible negative impact of measures on users against
the positive
in
particular the Community industry.

interested parties,

effects on other

(132) For all the abovementioned reasons, it is concluded that
the likely effect of measures on users would not be
disproportionate.
the
imposition of definitive anti-dumping duties would not
be against the Community interest.

It was therefore concluded that

actually

consider

the claim that

the processing activities
(135) Furthermore,
the
to move
would
Community, or that exporters would shift into further
processed products was not substantiated by sufficient
evidence. The investigation also revealed that
some
users had only recently invested in their production
process in the Community, which indicates that the relo-
cation of
those production facilities would be highly
unlikely.

outside

2. Imports of semi-finished and finished products

(136)

3. Employment

It was also argued that the processing industry employs
by far more people than the granular PTFE producers in
the Community and that those jobs would be in danger
should anti-dumping measures be imposed.

(133) Certain users also claimed that they would be placed in a
situation of competition distortion vis-à-vis producers in
the countries concerned of semi-finished and finished
products not subject to anti-dumping duties, in particular
because such producers would shift their exports to the
Community from granular PTFE to semi-finished and
in the
finished products. As a consequence, users
Community would need to relocate part of
their
business outside the European Community in order to
have access to cheaper raw material.

(134) As regards the semi-finished and finished products, it was
found that the threat of increasing imports of cheaper
semi-finished and finished downstream products from
the countries concerned is not imminent. On the basis
of the information available, i.e. in particular the known
quality difference between the imported granular PTFE
from the countries concerned and the one produced by
the Community industry, neither Russian nor Chinese
producers are currently able to produce the complete
product
the
Community, due to a lack of the necessary technical
know-how. A number of parties observed that
the
know-how of Russian and Chinese producers as well as
the quality of their products is constantly increasing and
that
the imposition of definitive anti-dumping duties
would accelerate this process because it would create

produced

range

users

the

by

in

capital-intensive, while

semi-finished or
labour-intensive.

finished products
Therefore,

(137) The investigation revealed that the information submitted
by the users’/importers’ organisation concerned with
regard to employment was largely overestimated.
In
those jobs would be
addition, only a proportion of
directly threatened by the imposition of anti-dumping
duties. It should also be noted that the production of
the
granular PTFE is more
production of
is
direct
much more
comparison between the number of
the
granular PTFE industry and the downstream industry is
not appropriate. Furthermore,
it should be noted that
some
non-complainant Community
at
producers and suppliers would also be threatened. As
indicated
the non-complainant Community
producers have already lost significant market share
since the beginning of the period considered. Finally, a
number of users and therefore jobs in the Community
are also dependent fully or partly on the supply from the
Community industry and from the non-complainant
Community
the
should
Community industry disappear
these jobs would be
equally in danger.

a
jobs of

producers.

Therefore,

above,

jobs

the

8.12.2005

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Official Journal of the European Union

L 320/17

4. Shortage of supply

the

that

have

argued

It was

even if

sufficient

also
industry would

(138) A number of parties also reiterated that the imposition of
definitive duties would lead to a shortage of supply
because it would prevent the exporting producers from
the PRC and Russia from exporting their products to the
Community, while the Community industry would not
capacity to supply the Community
have
demand.
the
theoretical
Community
capacity to increase its production of PTFE, this would
economically not be interesting since the production of
granular PTFE would generate less profit
than the
production of other fluoropolymers. It was claimed that
other sources, such as Japan and the USA would not be a
valid alternative because
from these
countries remain high. It was further claimed that the
shortage in the Community market would be aggravated
by the expected increase in demand on the Community
market. On the other hand, for certain low-end appli-
cations, the product produced in the Community would
be over-specified and would be too expensive to be used
in such applications. Finally, it was argued that reactor
bead would not be sold at all in the Community, while
pre-sintered grades are only produced in limited quan-
tities in the Community, thus users would be dependent
on imports from the countries under consideration.

import prices

(139)

the Community industry’s
It should be recalled that
capacity is 9 200 tons, at 80 % capacity utilisation. The
sales volume during the IP was about 4 845 tons. This
implies that the complaining producers would be able to
sell an additional 4 355 tons of the like product, which is
85 % of the total
imports of the countries concerned.
The argument that the Community industry would not
use this free capacity to produce granular PTFE, due to
the low profit margins generated by the sales of this
It should be noted that
product, had to be rejected.
supported by any evidence.
this argument was not
the
the
Moreover,
Community industry’s sales of granular PTFE was due
to the dumped imports which were significantly under-
cutting the Community industry’s prices and therefore
causing substantial price pressure. Therefore, with the
imposition of definitive anti-dumping duties prices on
the Community market should recover which would
also have a positive effect on the profitability.

low profitability

generated by

made by the users themselves. It was found that at least
two Community producers are able to produce pre-
sintered grades.
the
Community industry also sold ‘off-spec’ grades during
the IP, which are comparable to the low quality grades
from the PRC and Russia.

as mentioned above,

Finally,

(141) Other sources, such as Japan and USA are also available.
The argument that import prices from these countries are
higher than those from the countries under investigation
and that granular PTFE from Japan and the USA would
therefore not be a valid alternative cannot be accepted
is
because the purpose of
precisely to eliminate injurious dumping and restore
fair conditions of competition.

the anti-dumping duties

(142)

is further

recalled that

It
the purpose of any anti-
dumping measure is by no means to stop access to the
Community market
for products from the countries
concerned, but rather to restore a level playing field
trade practices.
that had been distorted by unfair
Therefore, granular PTFE,
types
from the countries
for which a shortage was alleged,
concerned can continue
the Community
market, albeit at higher price levels.

including the product

to enter

(143) Based on the abovementioned considerations and other
elements contained in recitals 139 to 153 of the provi-
it is concluded that no compelling
sional Regulation,
reasons exist for not imposing anti-dumping measures
on import of
the product concerned originating in
Russia and the PRC.

G. DEFINITIVE ANTI-DUMPING MEASURES

1. Injury elimination level

(140) As far as reactor bead is concerned,

it was found that
only very limited quantities were imported during the IP.
Likewise, imports of pre-sintered grades were very limited
during the IP, which implies that pre-sintered grades are

(144) Based on the methodology set out in recitals 154 to 159
of the provisional Regulation, an injury elimination level
was calculated for the purpose of establishing the level of
measures to be definitively imposed.

L 320/18

EN

Official Journal of the European Union

8.12.2005

(145) One of the Russian exporting producers claimed that the
adjustment for differences in the level of trade should
have been based on the information provided by the
fully cooperating unrelated importer which accounted
for the major part of its imports. However, although
the information of this importer was verified on-the-
spot, due to the highly complex sales structure of the
importer in question,
involving a number of different
companies from which no information was available,
purchase prices and consequently the profit margin of
this unrelated importer could not be reliably established
and were therefore not used. Alternatively, this exporting
producer
the
adjustment for the level of trade, the cif import price
should be compared to the resale price of the importer
in question in the Community. However,
it was found
that this methodology would not lead to more reliable
results than the methodology used for the provisional
the information available,
determinations.
in particular
the importer,
the audited accounts of
confirmed that the estimations made in the provisional
determinations were reasonable.

claimed that

to calculate

In contrast,

in order

the more

it was argued that

(146) Both Russian exporting producers also claimed that the
comparison of their export price to the non-injurious
price should have been made on a per-model basis. In
particular,
expensive
speciality types produced by the Community industry
should have been excluded from the calculation of the
injury elimination level. In this context, it is recalled that,
as outlined in recitals 28 to 40 of
this Regulation,
findings for both Russian exporting producers had to
be based on facts available in accordance with Article
18 of the basic Regulation. Since no reliable data on a
per-model basis was available, the determination of the
export price of these exporting producers was based on
data recorded by Eurostat. Furthermore, as mentioned in
recital 9 and 55 of this Regulation, imported PTFE after
post-treatment was of a similar quality to the PTFE
produced by the Community industry and could be
used in almost all applications, including high-end appli-
cations. This claim had therefore to be rejected.

(147) A number of parties contested the level of profit of 9,3 %
used for the calculation of the provisional underselling
margin, claiming that it was too high. In particular,
it
was argued that it should be taken into consideration
that the granular PTFE market is shrinking and cost of
the Community
production is
industry would not have been able to achieve 9,3 %
profit
It was
in the absence of dumped imports.
proposed to use a profit margin of 5 % instead.

increasing,

therefore

(148)

In this regard,
it is recalled that the profit margin of
9,3 % was based on actual and verified data submitted

i.e.

evidence which
by the Community producers,
showed that 9,3 % was the profit effectively obtained
before dumped imports started to penetrate into the
Community market. It is also noted that, as mentioned
this Regulation cost of production
in recital 112 of
decreased during the period considered. In the absence
of any new information, the methodology used for estab-
lishing the injury margin as described in recitals 156 to
159 of the provisional Regulation are hereby confirmed.

2. Definitive duties

(149)

In the light of the foregoing,
it is considered that a
definitive anti-dumping duty should be imposed at the
level of the dumping margin found, but should not be
higher than the injury margin calculated in accordance
with Article 9(4) of the basic Regulation.

(150) The proposed definitive duty rates, expressed as a
the CIF Community border price,

percentage of
customs duty unpaid, are as follows:

Exporting
country

PRC

Russia

Injury
elimination
margin

55,5 %

40,0 %

Dumping
margin

99,7 %

36,6 %

Proposed
anti-dumping
duty

55,5 %

36,6 %

(151)

In order to ensure a proper enforcement of the anti-
dumping duty, the residual duty level should not only
apply to the non-cooperating exporter, but also to those
companies which did not have any exports during the IP.
However, the latter companies are invited, when they
fulfil the requirements of Article 11(4) of the basic Regu-
lation, second paragraph,
for a
review pursuant to that Article in order to have their
situation examined individually.

to present a request

3. Undertakings

(152) One Chinese exporting producer which was granted
neither MET nor IT has shown an interest in offering
an undertaking. However, it is Commission practice not
to accept undertaking offers from companies which were
neither granted MET nor IT since no individual dumping
margin can be established in those cases. Moreover, the
investigation revealed that the accounts of the company
concerned were not reliable so that the monitoring of the
undertaking would have proved impractical.

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Official Journal of the European Union

L 320/19

(153) The

this Regulation,

two Russian exporting producers

also made
for offering an undertaking. However, as
proposals
stated in recitals 28 to 35 of
the
findings with regard to both exporting producers had
to be made on the basis of the facts available.
It is
recalled that the companies provided misleading infor-
mation in respect of certain aspects of the investigation
which affected the accuracy and reliability of their coop-
eration. Accordingly, the Commission was not satisfied
that an undertaking from these companies could be
effectively monitored and the offers were therefore
rejected,

HAS ADOPTED THIS REGULATION:

Article 1

A definitive anti-dumping duty is hereby imposed on
1.
imports of so-called granular polytetrafluoroethylene (PTFE),
containing not more than 3 % of other monomer unit than
tetrafluoroethylene, without fillers,
in the form of powder or
pellets, with the exclusion of micronised material (namely fluor-
opolymer micropowder as defined by norm ASTM D5675-04)
falling within CN code
(TARIC code
3904 61 00 50) and originating in Russia and the PRC. The
aforementioned product description also covers such products
presented as raw polymer (reactor bead) in wet or dry form.

ex 3904 61 00

Country

Rate of duty

PRC

Russia

55,5 %

36,6 %

Unless otherwise

3.
concerning customs duties shall apply.

specified,

the provisions

in force

Article 2

The amounts secured by way of provisional anti-dumping duties
to Commission Regulation (EC) No 862/2005 on
pursuant
imports of so called granular polytetrafluoroethylene (PTFE),
containing not more than 3 % of other monomer unit than
tetrafluoroethylene, without fillers,
in the form of powder or
pellets, with the exclusion of micronised material, and its raw
polymer (reactor bead), the latter in wet or dry form, falling
within CN code ex 3904 61 00 (TARIC code 3904 61 00 50)
and originating in Russia and the PRC shall be collected at the
rate of the duty definitively imposed. Amounts secured in excess
of the definitive rate of anti-dumping duties shall be released.
Where the definitive duties are higher than the provisional
duties, only the amounts secured at the level of the provisional
duties shall be definitively collected.

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

This Regulation shall enter into force on the day following 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, 2 December 2005.

For the Council
The President

M. BECKETT