Proposal for a Council Regulation amending Regulation (EC) No 1212/2005 imposing a definitive anti-dumping duty on imports of certain castings originating in the People’s Republic of China
Date: 2006-01-19
Institutions: European Commission
Subjects: China, anti-dumping duty, cast-iron, import, iron and steel product, originating product, road services department

COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 19.1.2006 
COM(2006) 10 final 

Proposal for a 

COUNCIL REGULATION 

amending Regulation (EC) No 1212/2005 imposing a definitive anti-dumping duty on 
imports of certain castings originating in the People’s Republic of China 

(presented by the Commission) 

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EXPLANATORY MEMORANDUM 

1)  CONTEXT OF THE PROPOSAL 

• 

Grounds for and objectives of the proposal 

This  proposal  concerns  the  application  of  Council  Regulation  (EC)  No  384/96  of  22 
December 1995 on protection against dumped imports from countries not members of 
the European Community, as last amended by Council Regulation (EC) No 2117/2005 
of 21 December 2005 ("the basic Regulation") in the proceeding concerning imports of 
certain castings originating in the People's Republic of China. 

• 

General context 

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

• 

Existing provisions in the area of the proposal 

Definitive  anti-dumping  duties  on  imports  of  certain  castings  originating  in  the 
People's  Republic  of  China  were  imposed  by  Council,  by  Regulation  (EC)  No 
1212/2005 of 25 July 2005. 

• 

Consistency with other policies and objectives of the Union 

Not applicable. 

2)  CONSULTATION OF INTERESTED PARTIES AND IMPACT ASSESSMENT 

• 

Consultation of interested parties 

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

• 

Collection and use of expertise 

There was no need for external expertise. 

• 

Impact assessment 

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

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

3)  LEGAL ELEMENTS OF THE PROPOSAL 

• 

Summary of the proposed action 

On  25  July  2005,  the  Council,  by  Regulation  (EC)  No  1212/2005  imposed  definitive 

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anti-dumping duties on imports of certain castings originating in the People's Republic 
of China. 

The  purpose  of  this  proposed  Regulation,  amending  Regulation  No  1212/2005,  is 
twofold: 

i) to ensure equal treatment between any new exporting producers and the co-operating 
companies not included in the sample of the investigation that led to the imposition of 
definitive duties. In this respect, it is considered that provision should be made in order 
to  apply  the  respective  weighted  average  duties  of  the  Market  Economy  Status 
companies  (0%)  or  the  companies  with  individual  Treatment  (28,6%)  to  any  new 
exporting  producers  which  can  demonstrate  that  they  operate  under  market  economy 
conditions or alternatively that they fulfill the conditions for individual treatment, and 

ii) to exempt from the payment of the anti-dumping duties the companies from which 
undertakings were accepted by a parallel Commission Decision.  

The  Member  States  were  consulted  regarding  the  proposal  for  the  amendment  of 
Regulation  (EC)  No  1212/2005.  It  is  therefore  proposed  that  the  Council  adopts  the 
attached proposal for a Regulation. 

• 

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 2117/2005 of 21 December 2005. 

• 

Subsidiarity principle 

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

• 

Proportionality principle 

The proposal complies with the proportionality principle for the following reasons: 

The form of action is described in the above-mentioned basic Regulation and leaves no 
scope for national decision. 

Indication  of  how  financial  and  administrative  burden  falling  upon  the  Community, 
national governments, regional and local authorities, economic operators and citizens is 
minimized and proportionate to the objective of the proposal is not applicable. 

• 

Choice of instruments 

Proposed instruments: regulation. 

Other means would not be adequate for the following reason: 

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

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4)  BUDGETARY IMPLICATION 

The proposal has no implication for the Community budget. 

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Proposal for a 

COUNCIL REGULATION 

amending Regulation (EC) No 1212/2005 imposing a definitive anti-dumping duty on 
imports of certain castings originating in the People’s Republic of China 

THE COUNCIL OF THE EUROPEAN UNION, 

Having regard to the Treaty establishing the European Community, 

Having  regard  to  Council  Regulation  (EC)  No  384/961  of  22  December  1995  on  protection 
against dumped imports from countries not members of the European Community (the ‘basic 
Regulation’), and in particular Articles 8 and 9 thereof, 

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

Whereas: 

(1) 

(2) 

(3) 

A. 

PROCEDURE 

The Council by Regulation (EC) No 1212/20052 (‘the definitive Regulation’) imposed 
definitive  anti-dumping  duties  on  imports  of  certain  castings  originating  in  the 
People’s Republic of China (‘original investigation’). 

B. 

NEW EXPORTER REVIEWS 

In the original investigation sampling was applied to the Chinese exporting producers. 
The non-sampled companies which were granted market economy treatment (‘MET’), 
in  accordance  with  the  provisions  of  Article  2(7)(c)  of  the  basic  Regulation,  were 
attributed the 0% dumping duty which was established for the sole sampled company 
which was granted MET. The non-sampled companies which were granted individual 
treatment  (‘IT’),  in  accordance  with  the  provisions  of  Article  9(5)  of  the  basic 
Regulation, received the weighted average duty of 28,6% established for the sampled 
companies  that  were  granted  IT.  A  country-wide  duty  of  47,8%  was  imposed  on  all 
other companies. 

Pursuant to Article 11(4) of the basic Regulation, a new exporter review to determine 
individual dumping margins could not be initiated in this proceeding, as sampling was 
used in the original investigation. However, in order to ensure equal treatment between 
any  new  exporting  producer  and  the  co-operating  companies  not  included  in  the 
sample of the original investigation it is considered that provision should be made in 

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OJ  L  56,  6.3.1996,  p.1.  Regulation  as  last  amended  by  Regulation  (EC)  No  2117/2005,  OJ  L  340, 
23.12.2005, p. 17. 
OJ L 199, 29.7.2005, p. 1. 

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order  to  respectively  impose  the  duty  applicable  to  the  companies  which  received 
MET (0%) or the weighted average duty of companies with IT (28,6%), to any new 
exporting  producers  which  can  demonstrate  that  they  meet  the  criteria  set  in  Article 
2(7)(c) of the basic Regulation in order to be granted MET or otherwise the criteria of 
Article  9(5)  in  order  to  be  granted  IT,  and  that  they  would  therefore  be  entitled  to  a 
review pursuant to Article 11(4) of the basic Regulation. 

C. 

UNDERTAKINGS 

Upon publication of the definitive Regulation, no undertakings could be accepted by 
the  Commission.  During  the  investigation  leading  to  the  imposition  of  definitive 
measures  several  exporting  producers  had  indicated  their  intention  to  offer  a  price 
undertaking but they had failed to submit sufficiently substantiated undertaking offers 
within the deadlines set in Article 8(2) of the basic Regulation. Nevertheless, as set out 
in recital 152 of the definitive Regulation, the Council, in view of the complexity of 
the  issue  for  the  economic  operators  in  question  (predominantly  small  and  medium-
sized  enterprises)  and  given  that  the  definitive  disclosure  was  not  preceded  by  a 
provisional  disclosure,  considered  that  they  should  exceptionally  be  allowed  to 
complete their undertaking offers beyond the said deadline. 

Subsequent  to  the  deadline  mentioned  above,  the  China  Chamber  of  Commerce  for 
Import and Export of Machinery and Electronics Products (‘CCCME’) together with 
twenty  co-operating  companies  or  groups  of  co-operating  companies  offered  an 
acceptable joint undertaking. 

 The  Commission  by  Decision  2006/[INSERT  NUMBER]/EC3,  accepted 
the 
undertaking offer. The Decision sets out in more detail the reasons for accepting this 
undertaking. The Council recognises that the undertaking offer eliminates the injurious 
effect of dumping and limits to a sufficient degree the risk of circumvention. 

To  further  enable  the  Commission  to  effectively  monitor  compliance  with  the 
undertaking,  when  the  request  for  release  for  free  circulation  is  presented  to  the 
relevant customs authority, exemption from the anti-dumping duty will be conditional 
upon the presentation of a commercial invoice containing at least the elements listed in 
the Annex. This level of information is also necessary to enable customs authorities to 
ascertain  with  sufficient  precision  that  shipments  correspond  to  the  commercial 
documents. Where no such invoice is presented, or when it does not correspond to the 
product presented to customs, the appropriate rate of anti-dumping duty will instead be 
payable. 

To  further  ensure  the  effective  respect  of  the  undertaking,  the  importers  should  be 
made  aware  that  any  violation  of  the  undertaking  may  lead  to  the  retrospective 
application  of  the  anti-dumping  duty  for  the  relevant  transactions.  Therefore,  it  is 
necessary to implement legal provisions providing for the incurrence of a customs debt 
at the level of the appropriate anti-dumping duty whenever one or more conditions for 
the  exemption  are  not  respected.  A  customs  debt  should  therefore  be  incurred 
whenever the declarant has chosen to release the goods for free circulation, i.e. without 

(4) 

(5) 

(6) 

(7) 

(8) 

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OJ L […] 

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collection of anti-dumping duty, and one or several conditions of that undertaking are 
found to have been violated. 

(9) 

In the event of a breach of the undertaking, the anti-dumping duty may be recovered, 
provided  that  the  Commission  has  withdrawn  the  acceptance  of  the  undertaking  in 
accordance  with  Article  8(9)  of  the  basic  Regulation,  by  referring  to  that  particular 
transaction and, accordingly, by declaring the relevant undertaking invoice as invalid. 
Therefore,  pursuant  to  Article  14(7)  of  the  basic  Regulation,  customs  authorities 
should inform the Commission immediately whenever indications of a violation of the 
undertaking are found. 

(10)  The companies concerned and the CCCME have been informed of the essential facts, 
considerations and obligations upon which the acceptance of the undertaking is based. 

(11) 

 It should be noted that in the event of a breach or withdrawal of the undertaking or in 
case  of  a  withdrawal  of  acceptance  of  the  undertaking  by  the  Commission,  the  anti-
dumping  duty  shall  automatically  apply,  pursuant  to  Article  8(9)  of  the  basic 
Regulation, 

HAS ADOPTED THIS REGULATION: 

Article 1 

In Regulation (EC) No 1212/2005, the following shall be inserted as the fourth 

1. 
paragraph of Article 1: 

“4. Where any new exporting producer in  the People’s Republic  of  China provides 
sufficient evidence to the Commission that: 

- it did not export to the Community the product described in Article 1(1) during the 
investigation period (1 April 2003 to 31 March 2004), 

-  it  is  not  related  to  any  of  the  exporters  or  producers  in  the  People’s  Republic  of 
China which are subject to the anti-dumping measures imposed by this Regulation, 

-  it  has  actually  exported  to  the  Community  the  product  concerned  after  the 
investigation  period  on  which  the  measures  are  based,  or  it  has  entered  into  an 
irrevocable contractual obligation to export a significant quantity to the Community, 

- it operates under market economy conditions defined in Article 2(7)(c) of the basic 
Regulation or alternatively that it fulfils the requirements to have an individual duty 
in accordance with Article 9(5) of the basic Regulation, 

the Council, acting by simple majority on a proposal submitted by the Commission 
after consulting the Advisory Committee, may amend Article 1(2) by adding the new 
exporting producer (i) to the companies subject to the duty rate of 0% applicable to 
companies  to  whom  market  economy  treatment  was  granted  in  accordance  with 
Article 2(7)(c) of Regulation (EC) No 384/96 or (ii) to the companies subject to the 
weighted  average  duty  rate  of  28,6%  applicable  to  companies  to  whom  individual 

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treatment was granted in accordance with Article 9(5) of Regulation (EC) No 384/96 
respectively.” 

Article 2 

In Regulation (EC) No 1212/2005, the following shall be inserted as Article 2: 

“Article 2 

1. 
Imports  declared  for  release  into  free  circulation  which  are  invoiced  by 
companies  from  which  undertakings  are  accepted  by  the  Commission  and  whose 
names  are  listed  in  Commission  Decision  2006/[INSERT  NUMBER]/EC,  as  from 
time  to  time  amended  shall  be  exempt  from  the  anti-dumping  duty  imposed  by 
Article 1, on condition that:  

they  are  manufactured,  shipped  and  invoiced  directly  by  the  said  companies  to  the 
first independent customer in the Community; and  

such  imports  are  accompanied  by  a  valid  undertaking  invoice.  An  undertaking 
invoice is a commercial invoice containing at least the elements and the declaration 
stipulated in the Annex; and 

the goods declared and presented to customs correspond precisely to the description 
on the undertaking invoice. 

A customs debt shall be incurred at the time of acceptance of the declaration 
2. 
for  release  into  free  circulation  whenever  it  is  established,  in  respect  of  goods 
described  in  Article  1  and  exempted  from  anti-dumping  duty  under  the  conditions 
listed  in  paragraph  (1),  that  one  or  more  of  such  conditions  are  not  fulfilled.  The 
second  condition  set  out  in  paragraph  (1)  shall  be  considered  as  not  being  fulfilled 
where  the  undertaking  invoice  is  found  not  to  comply  with  the  provisions  of  the 
Annex. It shall also be considered as not fulfilled where  the undertaking invoice is 
found not to be authentic and where the Commission has withdrawn the acceptance 
of the undertaking pursuant to Article 8(9) of the basic Regulation in a Regulation or 
Decision  which  refers  to  (a)  particular  transaction(s)  and  declares  the  relevant 
undertaking invoice(s) as invalid. 

3. 
Importers  shall  accept  as  a  normal  trade  risk,  that  the  non-fulfilment,  by  any 
party, of one or more of the conditions listed in paragraph 1 and further defined in 
paragraph 2 may give rise to a customs debt incurred under Article 201 of Regulation 
(EEC) No 2913/92. The customs debt incurred shall be recovered upon withdrawal 
by the Commission of the acceptance of the undertaking.”  

Article 3 

1. 

In Regulation (EC) No 1212/2005, Article 2 shall be renumbered Article 3. 

The  Annex  of  this  Regulation  shall  be  inserted  in  Regulation  (EC) 

2. 
No 1212/2005. 

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Article 4 

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

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

Done at Brussels, […] 

For the Council 
The President 

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ANNEX  

The following elements shall be indicated in the commercial invoice accompanying 
the  company’s  sales  of  certain  castings  to  the  Community  which  are  subject  to  an 
Undertaking: 

The  heading  ‘COMMERCIAL  INVOICE  ACCOMPANYING  GOODS 

1. 
SUBJECT TO AN UNDERTAKING’. 

2. 
The name of the company mentioned in Article 1 of the Commission Decision 
2006/[INSERT  NUMBER]/EC  accepting  the  undertaking  issuing  the  commercial 
invoice. 

3. 

4. 

The commercial invoice number. 

The date of issue of the commercial invoice. 

The  TARIC  additional  code  under  which  the  goods  on  the  invoice  are  to  be 

5. 
customs cleared at the Community frontier. 

6. 

The exact description of the goods, including: 

Product code number (PCN) used for the purposes of the investigation and the 

- 
undertaking (e.g. PCN 1, PCN 2, etc), 

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- 

- 

- 

plain language description of the goods corresponding to the PCN concerned, 

company product code (CPC) (if applicable), 

CN code, 

quantity (to be given in tonnes)  

7. 

The description of the terms of the sale, including: 

- 

- 

- 

- 

price per tonne,  

the applicable payment terms, 

the applicable delivery terms, 

total discounts and rebates. 

8. 
Name  of  the  company  acting  as  an  importer  in  the  Community  to  which  the 
commercial invoice accompanying goods subject to an undertaking is issued directly 
by the company. 

The  name  of  the  official  of  the  company  that  has  issued  the  invoice  and  the 

9. 
following signed declaration: 

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‘I, the undersigned, certify that the sale for direct export to the European Community 
of the goods covered by this invoice is being made within the scope and under the 
terms  of  the  undertaking  offered  by  [COMPANY],  and  accepted  by  the  European 
Commission  through  Decision  2006/[INSERT  NUMBER]/EC,  I  declare  that  the 
information provided in this invoice is complete and correct.’ 

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