Proposal for a Council Regulation amending Regulation (EC) No 950/2001 imposing a definitive anti-dumping duty on imports of certain aluminium foil originating inter alia in Russia
Date: 2006-01-04
Institutions: European Commission
Subjects: Russia, aluminium, anti-dumping duty, anti-dumping legislation, import, originating product, thin sheet

COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 4.1.2006 
COM(2005) 707 final 

Proposal for a 

COUNCIL REGULATION 

amending Regulation (EC) No 950/2001 imposing a definitive anti-dumping duty on 
imports of certain aluminium foil originating inter alia in Russia 

(presented by the Commission) 

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EXPLANATORY MEMORANDUM 

1)  CONTEXT OF THE PROPOSAL 

110 

• 

Grounds for and objectives of the proposal 

This  proposal  concerns  the  application  of  Council  Regulation  (EC)  No  384/96  of  22 
December 1995 on protection against dumped imports from countries not members of 
the European Community, as last amended by Council Regulation (EC) No 461/2004 
of  8  March  2004  (‘the  basic  Regulation’)  in  the  proceedings  concerning  imports  of 
certain aluminium foil originating in Russia and the People’s Republic of China. 

120 

• 

General context 

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

130 

• 

Existing provisions in the area of the proposal 

Regulation  (EC)  No  950/20011  imposed  a  definitive  anti-dumping  duty  of  14.9%  on 
imports  of  certain  aluminium  foil  (‘AHF’)  originating  in  Russia.  Following  the 
acceptance  of  an  undertaking  from  the  Russian  exporting  producer  Open  Joint  Stock 
Company Rusal Sayanal (‘Sayanal’), imports from this exporter were exempted from 
the anti-dumping duty by Commission Decision 2001/381/EC2. 

141 

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Consistency with the other policies and objectives of the Union 

Not applicable. 

2)  CONSULTATION OF INTERESTED PARTIES AND IMPACT ASSESSMENT 

• 

Consultation of interested parties 

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

• 

Collection and use of expertise 

There was no need for external expertise. 

• 

Impact assessment 

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

The  basic  Regulation  does  not  foresee  a  general  impact  assessment  but  contains  an 

OJ L 134, 17.05.2001, p. 1. Regulation as last amended by Regulation (EC) No 998/2004 (OJ L 183, 
20.05.2004, p. 4). 
OJ L 134, 17.05.2001, p. 67. 

219 

229 

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exhaustive list of conditions that have to be assessed. 

3)  LEGAL ELEMENTS OF THE PROPOSAL 

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Summary of the proposed action 

In November 2004, at the request of the Russian exporter Open Joint Stock Company 
Rusal  Sayanal,  the  Commission  initiated  an  interim  review  limited  in  scope  to  the 
examination  of  dumping  on  the  grounds  that  the  dumping  margin  on  which  the 
measures were based had decreased significantly.  

The  investigation  showed  that  there  were  no  sales  of  the  corresponding  product  type 
sold on the domestic market and therefore the normal value had to be constructed. For 
this  purpose,  the  cost  of  manufacturing  of  the  exported  product  type  was  taken  into 
consideration  after  energy  costs,  which  were  found  to  be  abnormally  low,  were 
adjusted to levels similar to those in countries with comparable hydroelectric resources. 
The amounts for selling and general expenses and profit were based on the company’s 
own data. 

The  comparison  between  the  weighted  normal  value  and  the  weighted  export  price 
showed that no dumping was taking place. 

It is therefore proposed to amend the existing measures by removing the duty as far as 
this  company  is  concerned.  Concerning  all  other  exporters  in  Russia,  the  existing 
measures would be maintained. 

Member States were consulted and supported this proposal 

It  is  proposed  that  the  Council  adopt  the  attached  proposal  for  a  Regulation  which 
should be published in the Official Journal as soon as possible. 

310 

• 

Legal basis 

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

329 

• 

Subsidiarity principle 

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

• 

Proportionality principle 

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

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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 

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341 

342 

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Choice of instruments 

Proposed instruments: regulation. 

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

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

4)  BUDGETARY IMPLICATION 

409 

The proposal has no implication for the Community budget. 

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Proposal for a 

COUNCIL REGULATION 

amending Regulation (EC) No 950/2001 imposing a definitive anti-dumping duty on 
imports of certain aluminium foil originating inter alia in Russia 

THE COUNCIL OF THE EUROPEAN UNION, 

Having regard to the Treaty establishing the European Community,  

Having  regard  to  Council  Regulation  (EC)  No  384/96  of  22 December  1995  on  protection 
against dumped imports from countries not members of the European Community3 ('the basic 
Regulation'), and in particular Article 11(3) thereof, 

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

Whereas: 

A. PROCEDURE 

Measures in force 

Following  an  investigation  (‘the  original  investigation’),  the  Council,  by  Regulation 
(EC)  No 950/20014, imposed a definitive anti-dumping duty of 14.9% on imports of 
certain aluminium foil (‘AHF’) originating in Russia. Following the acceptance of an 
undertaking  from  the  Russian  exporting  producer  Joint  Stock  ‘United  Company 
Siberian  Aluminium’,  which  has  since  changed  its  name5  to  Open  Joint  Stock 
Company Rusal Sayanal (‘Sayanal’) imports from this exporter were exempted from 
the anti-dumping duty by Commission Decision 2001/381/EC6. 

Request for an interim review 

A request for a partial interim review of Regulation (EC) No 950/2001 was received 
from Sayanal), an exporting producer of AHF subject to a price undertaking and part 
of the Russian Aluminium group of companies (‘Rusal’). 

In its request pursuant to Article 11(3) of the basic Regulation, Sayanal claimed that 
the circumstances with regard to dumping, on the basis of which the measures in force 

OJ  L  56,  6.3.1996,  p.  1.  Regulation  as  last  amended  by  Regulation  (EC)  No  461/2004  (OJ  L  77, 
13.3.2004, p. 12). 
OJ L 134, 17.05.2001, p. 1. Regulation as last amended by Regulation (EC) No 998/2004 (OJ L 183, 
20.05.2004, p. 4). 
See Notice 2004/C 193/03, OJ C 193, 29.7.2004, p. 3. 
OJ L 134, 17.05.2001, p. 67. 

1. 

(1) 

2. 

(2) 

(3) 

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were established, had changed and that these changes were of a lasting nature. Sayanal 
further  alleged  and  provided  prima  facie  evidence  to  show  that  a  comparison  of 
normal  value  based  on  its  own  costs  or  domestic  prices  and  export  prices  to  the 
Community would lead to a reduction of dumping significantly below the level of the 
current  measures  (14.9%).  Therefore,  they  claimed  that  the  continued  imposition  of 
measures at the existing levels, which were based on the level of dumping previously 
established, was no longer necessary to offset dumping. 

Initiation 

Having determined, after consulting the Advisory Committee, that sufficient evidence 
existed  for  the  initiation  of  a  partial  interim  review,  the  Commission,  by  a  notice 
published  in  the  Official  Journal  of  the  European  Union7  initiated  a  partial  interim 
review  limited  in  scope  to  the  examination  of  dumping  in  accordance  with  Article 
11(3) of the basic Regulation and commenced its investigation.  

The Commission officially advised the applicant, as well as the representatives of the 
exporting country, of the initiation of the interim review. Interested parties were given 
the opportunity to make their views known in writing and to request a hearing. 

The Commission also sent a questionnaire to the applicant and received a reply within 
the  deadline.  The  Commission  sought  and  verified  all  the  information  it  deemed 
necessary  for  the  determination  of  dumping  and  carried  out  verification  visits  at  the 
premises of the following companies: 

–  Sayanal, Sayanogorsk, Russia, and its related companies within the Rusal group: 

–  SAZ, Sayanogorsk, Russia (aluminium smelter) 

–  Rusal Sayanskaya Folga, Dmitrov, Russia (processor of small rolls) 

–  Trading House Russian Foil, Moscow, Russia 

–  Trading House Safoil, Moscow, Russia 

–  Rual Trade (BVI) Limited, Moscow, Russia 

–  Sibirsky Aluminium GmbH, Düsseldorf, Germany 

Review investigation period 

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

B. PRODUCT CONCERNED AND LIKE PRODUCT 

Product concerned 

The product concerned by the current review is the same as that defined in the original 
investigation, i.e. certain aluminium foil of a thickness of not less than 0.009 mm and 

3. 

(4) 

(5) 

(6) 

4. 

(7) 

1. 

(8) 

7 

OJ C 285, 23.11.2004, p. 3. 

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not  more  than  0.018  mm,  not  backed,  not  further  worked  than  rolled,  in  reels  of  a 
width  not  exceeding  650  mm  originating  in  Russia,  currently  classifiable  under  CN 
code 7607 11 10. 

2. 

(9) 

Like product 

Unlike in the previous investigation, Sayanal and its related companies sold AHF also 
on the Russian domestic market. Whereas the product concerned sold to the EC is in 
the form of “jumbo reels”, sales on the Russian domestic market were in the form of 
“small rolls”. Small rolls are processed from jumbo reels, by cutting them to smaller 
lengths and packaging them for sale to end-users. However, it was found that AHF in 
jumbo reels and small rolls both shared the same physical and chemical characteristics 
and uses. 

(10)  Consequently, AHF produced and sold on the Russian domestic market as well as that 
exported to the Community, have the same basic physical and chemical characteristics 
and uses and are therefore considered to be alike within the meaning of Article 1(4) of 
the basic Regulation. 

C. RESULTS OF THE INVESTIGATION 

1. 

Normal value 

(11)  Sales  on  the  domestic  market  are  made  by  Sayanal  via  Trading  House  Russian  Foil 
(‘THRF’)  to  Rusal  Sayanskaya  Folga  (‘RSF’)  who  processes  the  jumbo  reels  into 
small rolls and then sells them to independent customers within Russia. 

(12)  There  are  no  sales  of  jumbo  reels  to  independent  customers  in  Russia,  and  no 
representative  sales  of  small  rolls  to  independent  customers  in  the  Community.  As 
such,  no  proper  comparison  on  a  model  to  model  basis  could  be  made.  Therefore 
normal value was constructed according to Article 2(3) of the basic Regulation on the 
basis  of  the  company’s  cost  of  production  plus  a  reasonable  amount  for  selling, 
general and administrative costs (‘SG&A’) and for profits.  

(13)  Article  2(5)  of  the  basic  Regulation  provides  for  the  cost  of  manufacturing  to  be 
adjusted  where  “costs  associated  with  the  production  and  sale  of  the  product  under 
investigation are not reasonably reflected in the records of the party concerned”. 

(14)  The  investigation  established  that  the  related  smelting  company  was  charged  a  very 
low  price  for  its  electricity,  which  is  generated  at  the  Sayano-Shushenskoe  Hydro-
Electricity  Plant,  compared  to  prices  charged  in  third  countries  with  comparable 
hydro-electricity plants. The prices are set by the Regional Energy Commission. These 
prices were considered abnormally low and not reflecting the normal costs. Therefore 
they  were  adjusted  on  the  basis  of  the  2004  price  of  electricity  for  energy-intensive 
manufacturing in another representative market,  i.e. Norway, which  was  found to be 
€14/MWh. 

(15)  As regards the SG&A, they were determined on the basis of the company’s own data 
pursuant  to  the  chapeau  of  Article  2(6)  of  the  basic  Regulation.  However,  an 
adjustment was necessary in order to reflect the fact that, as pointed out in recital (12), 

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the company does not sell the same type of AHF rolls on the EC and Russian markets 
and that, in addition, these types are sold at a different level of trade.  

(16)  For the same reason, the profit on domestic sales had to be adjusted as well. In order to 
make  such  adjustment  and  given  the  existence  of  intra-group  transfer  prices,  it  was 
considered  appropriate  to  determine  the  profit  on  the  basis  of  the  profit  margin 
(32.1%) found for the audited consolidated accounts of the Rusal Group, expressed as 
a percentage of total costs. 

2. 

Export price 

(17)  Sales to the EU are made through a series of sales companies within the Rusal group: 
THRF,  Trading  House  Safoil  (‘Safoil’),  Rual  Trade  (BVI)  Limited  (‘Rual’)  and 
Sibirsky Aluminium GmbH (‘SAG’).  

(18) 

In the case sales were made via a related importer in the Community, the export price 
was  constructed  on  the  basis  of  the  resale  prices  to  independent  customers. 
Adjustments were made for all costs incurred between importation and resale by that 
importer,  including  SG&A  expenses,  and  a  reasonable  profit  margin,  in  accordance 
with  Article  2(9)  of  the  basic  Regulation.  The  latter  was  based  on  the  profit  margin 
found for an unrelated importer in the previous investigation. 

(19)  For  sales  made  through  a  related  company  outside  the  Community,  the  export  price 
was established on the basis of the resale price paid by the first independent buyer in 
the Community. 

3. 

Comparison 

(20)  The comparison of the export price to the constructed normal value was made on an 
ex-factory basis and at the same level of trade. In order to ensure a fair comparison, 
account  was  taken,  in  accordance  with  Article  2(10)  of  the  basic  Regulation,  of 
to  affect  prices  and  price 
differences 
comparability.  On  this  basis,  allowances  for  differences  in  transport  costs,  handling 
costs,  insurance  and  duty  payments  were  made,  where  applicable,  and  justified. 
Adjustments were also made where the export sales were made via a related company 
located in a country other than the country concerned or the Community, pursuant to 
Art 2(10)(i) of the basic Regulation.  

in  factors  which  were  demonstrated 

4. 

Dumping margin 

(21)  As  provided  for  under  Article  2(11)  of  the  basic  Regulation,  the  weighted  average 
constructed  normal  value  by  type  was  compared  with  the  weighted  average  net  ex-
works export price of the corresponding type of the product concerned. 

(22)  The comparison as described above did not show the existence of any dumping. 

D. LASTING NATURE OF CHANGED CIRCUMSTANCES 

(23) 

In accordance with Article 11(3) of the basic Regulation it was also examined whether 
the changed circumstances could reasonably be said to be of a lasting nature. 

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(24) 

In this respect, it was considered first of all that Sayanal has complied with its price 
undertaking  through  its  subsidiary  sales  company  in  the  Community,  Sibirsky 
Aluminium  GmbH  (‘SAG’)  since  the  imposition  of  measures.  At  the  same  time, 
Sayanal has retained a substantial share of the Community market indicating that it is 
able to compete at non-dumped price levels. 

(25)  The prices of the product concerned sold on third country markets were also examined 
in  order  to  assess  the  behaviour  of  the  company  in  markets  where  no  trade  defence 
measures  are  in  force.  It  was  found  that  these  prices  were  only  slightly  below  the 
current  export  prices  to  the  Community,  and  no  indications  of  dumping  on  these 
markets  were  found.  It  is  therefore  considered  that  there  is  no  reason  to  believe  that 
this change of circumstances and the findings on the absence of dumping would not be 
of a lasting nature.  

E. ANTI-DUMPING MEASURES 

(26)  As a result of the investigation it is considered appropriate to amend the anti-dumping 

measures applicable to imports of AHF from Sayanal.  

(27) 

Interested parties were informed of the essential facts and considerations on the basis 
of  which  it  is  intended  to  recommend  an  amendment  of  Council  Regulation  (EC) 
No 950/2001  and  were  given  an  opportunity  to  comment.  Their  comments  were 
considered and taken into account where appropriate, 

HAS ADOPTED THIS REGULATION: 

In  Article  1(2)  of  Council  Regulation  (EC)  No  950/2001  the  table  shall  be  replaced  by  the 
following: 

Article 1 

Country 

Company 

The PRC 

All companies 

Russia 

Open  Joint  Stock  Company  Rusal 
Sayanal,  Promploshadka,  Sayanogorsk, 
Republic of Khakasia 655600, Russia 

Rate of 
duty (%)

TARIC 
additional code 

15.0 

0  

- 

A255 

All other companies 

14.9  

A999 

Articles 1(3) and 2 of Council Regulation (EC) N° 950/2001 are hereby repealed. 

Article 2 

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

Article3 

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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