Proposal for a Council Regulation amending Regulation (EC) No 1676/2001 imposing a definitive anti-dumping duty on imports of polyethylene terephthalate (PET) film originating, inter alia, in India
Date: 2006-02-13
Institutions: European Commission
Subjects: India, anti-dumping duty, import, originating product, plastics

COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 13.02.2006 
COM(2006) 55 final 

Proposal for a 

COUNCIL REGULATION 

amending Regulation (EC) No 1676/2001 imposing a definitive anti-dumping duty on 
imports of polyethylene terephthalate (PET) film originating, inter alia, in India 

(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 polyethylene terephthalate (PET) film originating in India. 

•  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 

Council  Regulation  (EC)  No  1676/2001  imposing  definitive  anti-dumping  duties  on 
imports of PET film originating, inter alia, in India (OJ L 227, 23.8.2001, p. 1). 

Council  Regulation  (EC)  No  2597/1999  imposing  definitive  countervailing  duties  on 
imports of PET film originating, inter alia, in India (OJ L 316, 10.12.1999, p. 1). 

Commission  Decision  2001/645/EC  (OJ  L  227,  23.8.2001,  p.  56),  accepting 
undertakings  from  five  Indian  companies,  Ester  Industries  Limited  (‘Ester’),  Flex 
Industries  Limited  (‘Flex’),  Garware  Polyester  Limited  (‘Garware’),  MTZ  Polyfilms 
Limited (‘MTZ’), and Polyplex Corporation Limited (‘Polyplex’).  

•  Consistency with other policies and objectives of the Union 

Not applicable. 

2)  CONSULTATION OF INTERESTED PARTIES AND IMPACT ASSESSMENT 

•  Consultation of interested parties 

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

•  Collection and use of expertise 

There was no need for external expertise. 

•  Impact assessment 

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

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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 4 January 2005, the Commission initiated a partial interim review of the anti-dumping 
duties in force in respect of imports of polyethylene terephthalate (PET) film originating in 
India. The purpose of this review, limited in scope to the examination of dumping of the 
five Indian exporting producers from which undertakings were accepted and to the level of 
the residual duty, was to assess the need for the continuation, removal or amendment of the 
level of the existing measures. 

The  attached  proposal  to  maintain  anti-dumping  measures  on  imports  of  polyethylene 
terephthalate  (PET)  film  from  India  albeit  at  lower  levels,  is  based  on  the  definitive 
findings which confirmed that imports were dumped, although at lower levels than those 
established in the initial investigation. 

It  is  therefore  proposed  that  the  Council  adopts  the  attached  proposal  for  a  Regulation 
which should be published in the Official Journal of the European Union. 

•  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  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 1676/2001 imposing a definitive anti-dumping duty on 
imports of polyethylene terephthalate (PET) film originating, inter alia, in India 

THE COUNCIL OF THE EUROPEAN UNION, 

Having regard to the Treaty establishing the European Community,  

Having  regard  to  Council  Regulation  (EC)  No  384/96  of  22  December  1995  on  protection 
against dumped  imports  from  countries  not  members  of  the  European  Community1 
(‘the basic Regulation’), and in particular Article 11(3) thereof, 

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

Whereas: 

A. 

PROCEDURE 

(1) 

(2) 

1. 

Existing  measures  and  terminated  investigations  concerning  the  same 
product  

The Council, by Regulation (EC) No 2597/19992, imposed a definitive countervailing 
duty on imports of polyethylene terephthalate (‘PET’) film falling within CN codes ex 
3920 62 19 and ex 3920 62 90 and originating in India (‘the definitive countervailing 
measures’). The measures took the form of an ad valorem duty ranging between 3,8% 
and  19,1%  imposed  on  imports  from  individually  named  exporters,  with  a  residual 
duty rate of 19,1% imposed on imports from all other companies. 

The  Council,  by  Regulation  (EC)  No  1676/20013,  imposed  definitive  anti-dumping 
duties  on  imports  of  PET  film  originating,  inter  alia,  in  India  (the  definitive  anti-
dumping  measures’).  Sampling  was  applied  to  the  Indian  exporting  producers,  and 
individual  duties  ranging  from  0%  to  62,6%  were  imposed  on  the  companies  in  the 
sample, while other cooperating companies not included in the sample received a duty 
based on the weighted average dumping margin of 57,7% reduced by their individual 
export  subsidy  margin.  A  duty  of  53,3%  was  imposed  on  all  other  companies.  The 
original investigation period was 1 April 1999 – 31 March 2000 (‘the original IP’). 

1 

2 
3 

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 316, 10.12.1999, p. 1. 
OJ L 227, 23.8.2001, p. 1. 

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(3) 

(4) 

(5) 

(6) 

(7) 

(8) 

(9) 

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On  22  August  2001,  the  Commission,  by  Decision  (2001/645/EC)4,  accepted 
undertakings offered by five Indian producers: Ester Industries Limited (‘Ester’), Flex 
Industries  Limited  (‘Flex’),  Garware  Polyester  Limited  (‘Garware’),  MTZ  Polyfilms 
Limited  (‘MTZ’),  and  Polyplex  Corporation  Limited  (‘Polyplex’).  The  Commission 
announced on 17 February 2005 the change of name of MTZ by a notice published in 
the Official Journal of the European Union5. 

The  Council,  by  Regulations  (EC)  Nos  1975/2004  and  1976/20046,  extended  the 
definitive  countervailing  and  anti-dumping  measures  on  imports  of  PET  film 
originating in India, to imports of the same product consigned from Brazil and Israel, 
whether declared as originating in Brazil or Israel or not. 

On  28  June  20027,  the  Commission  initiated  a  partial  interim  review  of  Regulation 
(EC) No 2597/1999 limited to the form of the definitive countervailing measures and, 
in particular to the examination of the acceptability of an undertaking offered by one 
Indian  exporting  producer,  pursuant  to  Article  19  of  the  basic  Regulation.  This 
investigation has been terminated by Council Regulation (EC) No XXX/20068. 

On  22  November  20039,  the  Commission  initiated  a  partial  interim  review  of 
Regulation  (EC)  No  1676/2001  limited  to  the  form  of  the  definitive  anti-dumping 
measures.  This  investigation  has  been  concluded  by  Council  Regulation  (EC)  No 
XXX/200610, which amended Regulation (EC)No 1676/2001. 

On 10 December 200411, the Commission initiated an expiry review of the definitive 
countervailing measures. This investigation has been concluded by Council Regulation 
(EC) No ZZZ/2006 which maintained the definitive countervailing measures. 

On  23  August  200512,  the  Commission  initiated  a  review  of  Regulations  (EC)  Nos 
1975/2004 and 1976/2004 with respect to the application of an Israeli producer for an 
exemption  from  the  extended  measures.  This  investigation  has  been  concluded  by 
Council Regulation (EC) No 101/200613. 

2.  Request for a review 

On  5  November  2004,  a  request  for  a  partial  interim  review  of  Council  Regulation 
(EC)  No  1676/2001,  limited  to  the  level  of  dumping  was  lodged  by  the  following 
Community  producers:  Du  Pont  Teijin  Films,  Mitsubishi  Polyester  Film  GmbH  and 
Nuroll  SpA  (‘the  applicants’).  The  applicants  represent  a  major  proportion  of  the 
Community  production  of  PET  film.  Toray  Plastics  Europe  indicated  its  support  for 
the request, although it was not a formal applicant. 

OJ L 227, 23.8.2001, p. 56. 
OJ C 40, 17.2.2005, p. 8. 
OJ L 342, 18.11.2004, p. 1 and p. 8. 
OJ C 154, 28.6.2002, p. 2. 
OJ 
OJ C 281, 22.11.2003, p. 4. 
OJ 
OJ C 306, 10.12.2004, p. 2. 
OJ L 218, 23.5.2005, p. 3. 
OJ L 17, 21.1.2006, p. 1. 

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(10)  The  applicants  alleged  that  in  regard  to  imports  of  PET  film  from  the  five  Indian 
producers  from  whom  undertakings  were  accepted  by  Commission  Decision 
2001/645/EC,  the level  of  the existing measures  is no longer sufficient to counteract 
the injurious dumping.  

3. 

Investigation 

(11)  Having determined, after consulting the Advisory Committee, that sufficient evidence 
exists to justify the initiation of a partial interim review, the Commission announced 
on  4  January  2005,  by  a  Notice  of  initiation  published  in  the  Official  Journal  of  the 
European Union14, the initiation of a partial interim review, in accordance with Article 
11(3) of the basic Regulation. 

(12)  The  review  was  limited  in  scope  to  the  examination  of  dumping  by  the  five  Indian 
exporting  producers  from  which  undertakings  were  accepted  and  to  the  level  of  the 
residual duty, in order to assess the need for the continuation, removal or amendment 
investigation  period  was  from 
of 
1 October 2003 to 30 September 2004. 

the  existing  measures.  The 

level  of 

the 

(13)  The  Commission  officially  advised  the  exporting  producers,  the  representatives  of 
the exporting  country  and  the  Community  producers  of  the  initiation  of  the  partial 
interim  review.  Interested  parties  were  given  the  opportunity  to  make  their  views 
known  in  writing  and  to  request  a  hearing  within  the  time  limit  set  in  the  notice  of 
initiation. 

(14) 

In  order  to  obtain  the  information  deemed  necessary  for  its  investigation,  the 
Commission  sent  questionnaires  to  the  exporting  producers  concerned,  which  all 
cooperated by replying to the questionnaire. Verification visits were carried out at the 
premises of the following exporting producers in India: 

– 

– 

– 

Ester Industries Limited, New Delhi, 

Flex Industries Limited, New Delhi, 

Garware Polyester Limited, Aurangabad, 

–  MTZ Polyfilms Limited, Mumbai, 

– 

Polyplex Corporation Limited, New Delhi. 

B. 

PRODUCT CONCERNED AND LIKE PRODUCT 

1. 

Product concerned 

(15)  The  product  concerned  is,  as  defined  in  the  original  investigation,  polyethylene 
terephthalate  (PET)  film  originating  in  India,  normally  declared  under  CN  codes  ex 
3920 62 19 and ex 3920 62 90.  

14 

OJ C 1, 4.1.2005, p. 5. 

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2. 

Like product 

(16)  As in the original investigation, it was found that PET film produced and sold on the 
domestic  market  in  India  and  PET  film  exported to the Community from India have 
the same basic physical and technical characteristics and uses. Therefore, they are like 
products within the meaning of Article 1(4) of the basic Regulation. 

C. 

DUMPING 

1.  Normal value 

(17) 

(18) 

In order to establish normal value, it was first verified that the total domestic sales of 
each of the exporting producers were representative in accordance with Article 2(2) of 
the basic Regulation, i.e. that they accounted for 5% or more of the total sales volume 
of the product concerned exported to the Community. For all companies, overall sales 
were found to be representative. 

It was then ascertained whether total domestic sales of each product type constituted 
5% or more of the sales volume of the same type exported to the Community. For two 
companies it was found that they sold second grade film on the domestic market but 
not  to  the  Community.  Since  second  grade  film  is  not  directly  comparable  to  first 
grade film, sales of second grade film were excluded from the calculation of normal 
value. Another company sold three different grades of film on the domestic market but 
only  the  best  quality  film  to  the  Community.  In  selling  the  three  grades  of  film,  the 
company often sold the first and second grade films en masse with third grade film but 
all  at  the  price  of  the  third  grade  film.  This  was  explained  as  being  a  form  of  stock 
clearance. Again, these sales were excluded from the calculation. 

(19)  One company sold to traders on the domestic market goods which were destined for 
export. The goods were readily identifiable as being destined for export, as they were 
subject  to  a  different  tax  regime  from  normal  sales  on  the  domestic  market.  The 
company  could  not  indicate  whether  the  final  destination  of  the  goods  would  be  the 
Community  or  a  third  country.  These  sales  were  therefore  excluded  from  the 
calculation. 

(20)  For  those  product  types  where  domestic  sales  constituted  5%  or  more  of  the  sales 
volume  of  the same  type  exported to the Community, it was then examined whether 
sufficient sales had been made in the ordinary course of trade pursuant to Article 2(4) 
of  the  basic  Regulation.  For  each  product  type  where  the  volume  of  domestic  sales 
made  at  a  net  sales  price  equal  to  or  above  the  cost  of  production  represented  more 
than 80% of the total sales volume of that type, and where the weighted average price 
of that type was equal to or above the cost of production, normal value was established 
on the basis of the weighted average price actually paid for all domestic sales of that 
type, irrespective of whether these sales were profitable or not. For those product types 
where the volume of profitable  sales was equal to  or  lower than 80%,  but not lower 
than 10% of sales, or where the weighted average price of that type was below the cost 
of production, normal value was based on the weighted average price actually paid for 
the profitable domestic sales of that type only. 

(21)  For the product types where domestic prices of the exporting producers could not be 
used  to  establish  normal  value  owing  to  insufficient  representativity  or  to  a  lack  of 

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sufficient  sales  in  the  ordinary  course  of  trade,  normal  value  was  constructed  on  the 
basis  of  the  manufacturing  costs  of  the  product  types  exported  to  the  Community 
incurred  by  the  exporting  producers  concerned  plus  a  reasonable  amount  for  selling, 
general  and  administrative  costs  (‘SG&A  costs’)  and  for  profits,  in  accordance  with 
Article 2(3) and (6) of the basic Regulation. 

(22) 

In accordance with Article 2(6) of the basic Regulation the SG&A costs were based on 
such costs incurred by the exporting producers with regard to their domestic sales of 
the product concerned, which were found to be representative. The profit margin was 
calculated  on  the  basis  of  the  weighted  average  profit  margin  of  each  company  for 
those product types sold on the domestic market in sufficient quantities in the ordinary 
course of trade. 

(23)  Following  disclosure,  one  exporting  producer  contested  the  adjustment  made  to  the 
price  paid  in  respect  of  one  specific  raw  material.  The  contested  adjustment  was  re-
examined,  following  which  the  level  of  adjustment  was  revised  and  the  dumping 
margin recalculated accordingly. 

(24)  Another company argued that film which was not of top-quality should be included in 
the  calculation  and  that  ‘adjustments’  should  be  made  in  order  to  make  that  film 
comparable  at  the  level  of  first  grade  film.  It  was  also  argued  that  further  to  the 
inclusion  of  these  transactions  a  re-calculation  of  the  profit  margin  would  be 
necessary. 

(25)  The volume of second and third grade film excluded from the calculation represented 
less  than  3%  of  all  domestic  sales.  As  such,  it  is  considered  that  the  remaining 
domestic  transactions  are  sufficiently  representative  for  an  accurate  calculation  of 
normal value. No re-calculation of the profit margin is therefore required. 

(26)  The exporting producers received disclosure of the calculations and submitted certain 
comments. The Commission took into account those comments and, to the extent that 
they were found to be justified, adjusted the calculations accordingly. 

2. 

Export price 

(27)  As  regards  the  determination  of  export  prices,  it  should  be  recalled  that  the  present 
investigation  seeks  to  establish  whether  the  levels  of  dumping  have  changed  and 
whether these changes can be considered to be of a lasting nature. In that context, the 
determination of export prices cannot be limited to an examination of exporters’ past 
behaviour,  but  has  to  examine  also  the  likely  development  of  export  prices  in  the 
future. In other words, it has to be determined whether past export prices are reliable 
as an indication of future likely export prices. In this case, and in view of the fact that 
undertakings  were  accepted,  it  was  examined  in  particular  whether  the  existence  of 
such undertakings has influenced the past export prices, so as to make them unreliable 
for the establishment of future export behaviour.  

(28) 

In order to examine whether export prices to the Community were reliable and given 
the  existence  of  undertakings,  export  prices  to  the  Community  were  analysed  in 
relation  to  the  minimum  import  prices  (MIPs)  of  the  undertakings.  It  was  in  fact 
necessary  to  ascertain  whether  export  prices  to  the  Community  were  set  at  a  certain 
level mainly as the effect of the existence of the MIP established by the undertakings 

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and therefore whether they were sustainable or not. It was therefore considered, on a 
weighted average basis at the level of each company, whether the prices practised for 
sales  to  the  EC  market  were  substantially  above  the  MIPs  or  not,  taking  into 
consideration the particularities of the product concerned and the markets on which it 
was being sold during the IP, and how these prices related to prices for exports to third 
countries. When export prices to the Community were on average well above the MIPs 
at  company  level,  it  was  considered  that  these  export  prices  were  set  sufficiently 
independently  from  the  undertakings,  and  therefore  reliable  as  an  indication  of  the 
price-setting behaviour which exporters would be likely to show in the future. On the 
contrary, when export prices to the Community were on average not sufficiently above 
the  MIPs  and  in  addition  significantly  above  export  prices  to  third  countries,  the 
former were considered to be influenced by the undertakings and therefore not reliable 
enough  to  be  used  for  the  dumping  calculation,  pursuant  to  Article  2(8)  of  the  basic 
Regulation, in the context of an interim review. 

(29)  For  two  Indian  exporters,  Flex  and  Polyplex,  it  was  found  that  their  export  prices  to 
the  Community  were  substantially  above  the MIPs.  Therefore,  these  export  prices  to 
the  Community  were  considered  as  reliable  and  were  used  in  the  dumping 
calculations.  

(30)  For  the  other  three  exporting  producers,  Ester,  Garware  and  MTZ,  it  was  found  that 
the export prices to the Community were very close to the MIPs. Moreover, it was also 
found  that  the  export  prices  of  these  three  companies  to  other  third  countries  were, 
when  considered  on  a  type  by  type  basis,  considerably  below  the  prices  to  the 
Community, thus making it likely that, in the absence of undertakings such prices to 
the Community would be aligned to the prices made for the same types to other third 
countries. It was therefore concluded that the export prices of these three companies to 
the Community could not be used to establish reliable export prices in the meaning of 
Article 2(8) of the basic Regulation, in the context of the present interim review. 

(31) 

It was considered, however, that the absence of a reliable price for these three Indian 
exporters, due to the existence of the undertakings in this case, should not lead to the 
termination  of  the  review  for  these  exporters,  if  a  lasting  change  in  circumstances 
regarding  their  dumping  behaviour,  in  particular  regarding  export  prices,  could 
nevertheless  be  otherwise  established.  To  this  end  and,  given  that  the  exporting 
producers were selling the product concerned on the world market, it was decided to 
establish  the  export  price  on  the  basis  of  prices  actually  paid  or  payable  to  all  third 
countries for those models sold to the Community.  

(32)  Following disclosure of the essential facts and considerations on the basis of which it 
was intended to propose an amendment to Council Regulation (EC) No 1676/2001, a 
number of parties came forward with comments.  

(33)  A number of Indian exporting producers and the Indian Government maintained that 
no  legal  basis  existed  under  Articles  2(8)  or  2(9)  of  the  basic  Regulation  for  basing 
export  prices  on  those  to  third  countries.  They  argued  that  export  prices  to  the 
Community  existed  and  that  it  was  not  satisfactorily  demonstrated  that  there  was  a 
sufficient basis to reject the use of those export prices. They maintained that the export 
prices to the Community were reliable and that they should be used instead of prices to 
third countries.  

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(34) 

In  respect  of  the  use  of  export  prices  to  third  countries,  it  must  be  stated  that  the 
purpose  of  this  review  under  Article  11(3)  of  the  basic  Regulation  is  to  determine 
whether the continued imposition of the measures is still necessary to offset dumping. 
In  examining  the  level  of  dumping  of  the  exporters  concerned,  it  is  necessary  to 
examine  the  change  in  the  level  of  dumping  compared  to  the  original  findings  on 
dumping.  It  should  be  noted  that  the  use  of  the  prices  to  third  countries  rather  than 
those to the Community in the case of three Indian exporting producers is not based on 
the  application  of  Articles  2(8)  and  2(9)  of  the  basic  Regulation.  As  explained  in 
recitals  (27)  and  (28)  above,  this  is  justified  by  the  need  to  assess  the  likelihood  of 
those prices to the Community being maintained in the future and, consequently, the 
likelihood of recurrence of dumping.  

(35)  The  conclusion  drawn  from  this  assessment  was  that,  in  the  case  of  three  Indian 
exporting  producers,  their  prices  to  the  Community  had  been  influenced  by  the 
existence of the MIPs, since they were set very close to the MIPs. Thus, they were not 
a result of only market forces and were unlikely to be maintained at the same level into 
the  future.  Consequently,  it  was  considered  that  there  were  no  prices  to  the 
Community which could be used for the calculation of dumping. In the absence of an 
export price to the Community, it was considered that prices to third countries formed 
an  accurate  and  reasonable  alternative  basis  for  the  establishment  of  export  prices 
during the investigation period and for the calculation of dumping. 

(36)  One  Indian  exporting  producer  argued  that  the  rejection  of  its  sales  prices  to  the 
Community  and  the  use  of  its  prices  to  third  countries  constituted  discrimination  in 
that it was treated differently from those exporters for which their actual sales prices to 
the Community were used. 

(37) 

In  this  respect,  it  should  be  noted  that  no  discrimination  occurred  in  establishing 
export prices since the same approach was taken in respect of all Indian exporters. In 
respect  of  each  exporting  producer,  the  existence  of  suitable  export  prices  to  the 
Community  for  the  purpose  of  the  calculation  of  dumping  was  assessed.  This  was 
carried out by comparing each exporting producer’s export prices to the Community 
with the MIPs in order to establish whether or not they could be considered as having 
been  set  independently  of  those  MIPs.  As  explained  in  recital  (28)  above,  in  cases 
where  those  prices  were  sufficiently  above  the  MIPs  it  was  concluded  that  they  had 
not  been  influenced  by  the  MIPs  and  that  the  prices  could  be  used  for  the  dumping 
calculation as they were reliable as an indication of the price-setting behaviour which 
the exporting producer would be likely to show in the future.  

(38)  Where it was considered that the prices to the Community had been influenced by the 
existence of the MIPs, then those prices were not considered reliable as an indication 
of the price-setting behaviour which the exporter would be likely to show in the future 
and were not used for the dumping calculation, prices to third countries being used as 
an alternative. The fact therefore that actual export prices of some exporters were used, 
while  for  other  exporters  their  export  prices  to  third  countries  were  used,  is  not  a 
discrimination of treatment between exporters. 

(39)  A  number  of  Indian  exporting  producers  disagreed  with  the  conclusion  that  their 
export prices to the Community were very close to the MIPs and therefore could not 
be  used  for  the  calculation  of  dumping.  They  considered  that  their  prices  were 
sufficiently above the MIPs and pointed out that under the price undertaking they were 

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(40) 

(41) 

merely  required  not  to  sell  below  the  MIP.  One  exporter  argued  that  comparison 
against the MIPs was not a satisfactory basis to determine whether or not prices to the 
Community  were  reasonable  and  reliable,  but  that  a  comparison  with  the  prices  of 
other  Indian  exporting  producers  or  of  the  Community  industry  would  be  more 
suitable. 

In  this  respect,  as  explained  in  recital  (30)  above,  the  Community  institutions  found 
that the prices of three exporting producers were not sufficiently above the level of the 
MIPs  so  as  to  demonstrate  that  they  had  been  set  independently  of  the  MIPs. 
Therefore, such prices did not form a suitable basis for the dumping calculation. The 
fact that, under the price undertakings, the exporting producers were merely required 
not to sell below the MIP was therefore not only not contested but irrelevant for this 
type of analysis. 

In  the  context  of  considering  whether  or  not  the  prices  to  the  Community  had  been 
influenced by the existence of the MIPs, it should be noted that when undertakings are 
present it is necessary to consider whether or not export prices are reliable and form a 
proper basis for the calculation of dumping margins. When prices to the Community 
are influenced by factors other than market forces, such as the undertaking MIPs, then 
these  prices  are  considered  as  not  reasonable  or  reliable.  In  this  case,  it  must  be 
pointed out that a comparison with the prices of each exporting producer to other third 
countries, as mentioned in recital (28), was considered more appropriate to determine 
the price-setting behaviour of a particular exporting producer, than a comparison with 
the  prices  of  other  Indian  exporting  producers  or  the  Community  industry,  since  it 
provided a better insight into the individual exporting producer’s business behaviour. 

(42)  The Community industry argued that in view of the distorting effect of the undertaking 
MIPs, actual sales prices to the Community should have been rejected and use made 
instead  of  prices  to  third  countries  in  the  case  of  all  the  Indian  exporting  producers. 
They also expressed concern that those Indian exporting producers with low dumping 
margins  calculated  using  export  prices  to  the  Community,  would  not  continue  to 
maintain their prices at the same level in the future.  

(43)  As concerns this argument, and as explained at recital (32) above, the same approach 
was adopted in respect of all Indian exporting producers. The use or non-use of each 
exporter’s  prices  to  the  Community  was  based  on  the  result  of  the  assessment  of 
whether or not those prices were influenced by the existence of the MIPs and on the 
difference between their price to the Community and export prices to third countries, 
as explained in recital (28) above.  

(44)  The Community industry also maintained that the comparison on a weighted average 
basis  of  export  prices  with  the  MIPs,  in  order  to  determine  whether  prices  to  the 
Community were representative of future behaviour and reliable for the assessment of 
dumping, was contradictory to the findings of the review of the form of the measures 
that the MIPs were no longer appropriate. 

(45) 

In  this  regard  it  is  to  be  noted  that  the  question  under  the  review  of  the  form  of  the 
anti-dumping  measures  was  whether  or  not  the  price  undertakings  were  still 
appropriate  or  relevant  (in  the  sense  that  they  would  have  the  same  effect  as  the 
imposition  of  an  anti-dumping  duty)  to  the  products  being  exported  under  them  (see 
recital  (8)  of  Council  Regulation  XXX).  In  that  review  it  was  found  that  for  some 

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product groupings the range of actual prices to the EC had changed (either widened or 
narrowed)  significantly  from  the  original  investigation  and  it  was  concluded  that  the 
specific  MIPs  based  on  the  original  prices  were  inappropriate  to  counteract  the 
injurious effect of dumping in respect of current sales. Under the present review, the 
question was whether or not the prices to the EC were influenced by the existence of 
the undertaking MIPs, i.e. whether or not they are lasting. It is maintained that where 
prices  are  substantially  above  the  MIPs  then  those  prices  are  not  influenced  by  the 
MIPs. This applies irrespective of whether price undertakings are appropriate for the 
product. In this case, the prices are therefore set by market forces and form a suitable 
basis for the assessment of dumping behaviour. This argument is therefore rejected. 

3.  Comparison 

(46)  The  normal  value  and  export  price  were  compared  on  an  ex-works  basis.  Due 
allowance  in  the  form  of  adjustments  was  made  for  differences  affecting  price  and 
price  comparability  in  accordance  with  Article  2(10)  of  the  basic  Regulation. 
Accordingly,  adjustments  were  made  for  differences  in  discounts,  rebates,  transport, 
insurance,  handling,  loading  and  ancillary  costs,  packing,  credit  and  commissions, 
where applicable and supported by verified evidence. Adjustments to the export price 
were also made for some models of Ester, Garware and MTZ, as regards differences 
for  physical  characteristics  of  the  product  sold  to  third  markets  vis-à-vis  the  product 
sold to the Community, pursuant to Article 2(10)(a) of the basic Regulation. 

(47)  Two exporting producers claimed also, for a limited number of exports, an adjustment 
on the export price pursuant to Article 2(10)(k) of the basic Regulation, based on the 
amount of the benefits received on exportation under the Duty Entitlement Passbook 
Scheme  (DEPB)  on  a  post-export  basis.  In  this  respect,  it  was  found  that  under  this 
scheme, the credits received when exporting the product concerned could be used to 
offset  customs  duties  due  on  imports  of  any  goods  or  could  be  freely  sold  to  other 
companies. In addition, there is no constraint that the imported goods should only be 
used  in  the  production  of  the  exported  product.  The  producers  did  therefore  not 
demonstrate that the benefit under the DEPB scheme on a post-export basis affected 
price  comparability  and,  in  particular,  that  the  customers  consistently  paid  different 
prices on the domestic market because of the DEPB benefits. Therefore, the claim was 
rejected. 

4.  Dumping margin 

(48)  The  dumping  margin  was  established  on  the  basis  of  a  comparison  of  a  weighted 
average normal value with a weighted average export price, in accordance with Article 
2(11)  of  the  basic  Regulation.  Where  export  prices  were  based  on  prices  to  third 
countries, appropriate CIF values were calculated by increasing the ex-works price to 
third countries by the weighted average difference, by product type, between the ex-
works and CIF level prices to the Community.  

(49)  Given the considerable reduction of the individual dumping margins compared to the 
initial  measures,  it  was  also  considered  appropriate  to  modify  the  residual  duty.  The 
latter was established, pursuant to Article 11(9) of the basic Regulation, on the basis of 
the highest dumping margin established for the five Indian exporting producers subject 
to  the  current  review,  since  the  five  companies  concerned  were  considered  to  be 

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representative  of  the  sampled  cooperating  producers  in  terms  of  export  volumes  on 
which basis the initial residual duty was calculated. 

(50)  The dumping margins, expressed as a percentage of the CIF Community frontier price, 

duty unpaid, are as follows: 

Ester Industries Ltd. 

Flex Industries Ltd. 

Garware Polyester Ltd. 

MTZ Polyfilms Ltd. 

Polyplex Corporation Ltd. 

All other companies 

29,3% 

3,2% 

20,1% 

26,7% 

3,7% 

29,3% 

D. 

LASTING NATURE OF THE CHANGED CIRCUMSTANCES 

(51) 

(52) 

(53) 

In accordance with Article 11(3) of the basic Regulation, an analysis was made as to 
whether the change in circumstances with regard to dumping could reasonably be said 
to be of a lasting nature.  

In this regard, it should be noted that normal value was established on the basis of the 
applicants’ costs and prices. The exporters have a substantial domestic market for the 
product concerned, and domestic prices have increased in comparison with the original 
investigation. No indications could be found that the normal value established during 
the present review could not be considered to be of a lasting nature.  

It  could  be  argued  that  the  evolution  of  the  prices  of  the  raw  materials,  highly 
correlated to the oil prices, could have a significant influence on the normal value. It 
was  however  considered  that  since  the  raw  materials  are  commodities  for  which  the 
price  is  internationally  determined,  the  effect  of  the  price  increase  would  affect  all 
actors on the market and therefore have an impact on both the normal value and the 
export price. 

(54)  As  already  mentioned  in  recitals  22  and  23,  given  the  existence  of  undertakings,  in 
order to examine whether export prices to the Community could be considered to be of 
a  lasting  nature  or  not,  the  latter  needed  to  be  analysed  in  relation  to  the  minimum 
import  prices  (MIPs)  set  in  the  undertakings.  In  addition,  a  price  comparison  was 
made between the prices of the product concerned sold for export to the Community 
and for export to third countries during the investigation period. As explained in recital 
23, it was considered that when export prices to the Community were not sufficiently 
above  the  MIPs  and  were  significantly  above  export  prices  to  third  countries,  the 
former  were  not  considered  to  be  a  reliable  indication  of  the  price-setting  behaviour 
which exporters would be likely to show in the future. Instead, export prices to third 

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countries were used in order to determine future export prices that could be considered 
as lasting.  

(55)  On  that  basis,  it  is  concluded  that  the  changed  circumstances  with  respect  to  the 
original  investigation  regarding  dumping  could  reasonably  be  considered  to  be  of  a 
lasting  nature,  with  the  particularity  that  for  three  Indian  exporters,  as  concluded  in 
recital 26, the lasting change in circumstances regarding their dumping behaviour, in 
particular regarding export prices, had to be established on the basis of prices actually 
paid or payable to other third countries for those models sold to the Community rather 
than on the basis of their export price to the Community.  

(56)  The considerable reduction of the individual dumping margins of the companies in the 
sample,  as  compared  to  the  initial  measures,  and  the  lasting  nature  thereof,  can  be 
considered to be representative for all other companies as well. Therefore, the residual 
duty had to be modified accordingly, as explained in recital 30 above. 

E. 

CONCLUSION 

(57) 

In view of the conclusions reached with regard to dumping and the lasting nature of 
the  changed  circumstances,  and  having  regard  to  the  conclusions  of  Council 
Regulation  (EC)  No  XXX/200615  as  regards  the  form  of  the  anti-dumping  measures 
(withdrawal  of  the  undertakings  in  force),  the  anti-dumping  measures  on  imports  of 
the product concerned originating in India, should be amended in order to reflect the 
new dumping margins found. 

(58)  Since, pursuant to Article 14(1) of the basic Regulation, no product shall be subject to 
both anti-dumping and countervailing duties for the purpose of dealing with one and 
the  same  situation  arising  from  dumping  or  from  export  subsidisation,  the 
countervailing  duty  in  force  that  corresponds  to  export  subsidies  was  deducted  from 
the anti-dumping duty to be applied. For the residual duty, the deduction corresponds 
to  the  export  subsidy  margin  of  the  company  on  the  basis  of  which  the  residual 
dumping margin was established. 

(59)  On the basis of the above, and taking into account the findings of the expiry review of 
the  definitive  countervailing  duties  (Council  Regulation  EC  No  ZZZ/2006),  the 
proposed duty amounts, expressed on the CIF Community border price, customs duty 
unpaid, are as follows: 

Company 

Export 
Subsidy 
Margin 

Total 
Subsidy 
Margin 

Dumping 
Margin 

CVD 
duty 

AD 
duty 

Total duty 
rate 

Ester Industries 
Ltd. 

Flex  Industries 
Ltd. 

12,0% 

12,0%

29,3% 12,0% 17,3% 

29,3%

12,5% 

12,5%

3,2% 12,5%

0,% 

12,5%

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Garware 
Polyester Ltd. 

MTZ Polyfilms 
Ltd. 

Polyplex 
Corporation 
Ltd. 

All other 
companies 

2,7% 

3,8%

20,1%

3,8% 17,4% 

21,2%

8,7% 

8,7%

26,7%

8,7% 18,0% 

26,7%

19,1% 

19,1%

3,7% 19,1%

0% 

19,1%

12,0%1 

19,1%

29,3% 19,1% 17,3% 

36,4%

(1)  For  the  purpose  of  calculating  the  final  anti-dumping  duty  for  ‘all  other  companies’,  the  export 
subsidy margin of the company on the basis of which the dumping margin for ‘all other companies’ is 
based was taken into consideration. 

(60)  As outlined under recital (4) above, the anti-dumping measures in force were extended 
to cover, in addition, imports of PET film consigned from Brazil and Israel, whether 
declared as originating in Brazil or Israel or not. The amended anti-dumping measures, 
as set out in recital (59) above, should continue to be extended to imports of PET film 
consigned from Brazil and Israel, whether declared as originating in Brazil or Israel or 
not.  The  Brazilian  and  Israeli  exporting  producers  who  were  exempted  from  the 
measures  as  extended  by  Regulation  (EC)  No  1975/2004  and  amended  by  Council 
Regulation  (EC)  No  101/200613  should  also  be  exempted  from  the  measures  as 
amended by this Regulation. 

(61)  All  parties  concerned  were  informed  of  the  essential  facts  and  considerations  on  the 
basis of which it was intended to propose an amendment to Council Regulation (EC) 
No 1676/2001 and were given the opportunity to comment. 

(62)  The  individual  company  anti-dumping  duty  rates  specified  in  this  Regulation  were 
established  on  the  basis  of  the  findings  of  the  present  investigation.  Therefore,  they 
reflect  the  situation  found  during  that  investigation  with  respect  to  these  companies. 
These  duty  rates  (as  opposed  to  the  country-wide  duty  applicable  to  ‘all  other 
companies’)  are  thus exclusively applicable to imports of products originating in the 
country  concerned  and  produced  by  the  companies  and  thus  by  the  specific  legal 
entities mentioned. Imported products produced by any other company not specifically 
mentioned in the operative part of this Regulation with its name and address, including 
entities  related  to  those  specifically  mentioned,  cannot  benefit  from  these  rates  and 
shall be subject to the duty rate applicable to ‘all other companies’. 

(63)  Any claim requesting the application of these individual company anti-dumping duty 
rates, for instance following a change in the name of the entity or following the setting 
up  of  new  production  or  sales  entities,  should  be  addressed  to  the  Commission 
forthwith  with  all  relevant  information,  in  particular,  any  modification  in  the 
company's  activities  linked to  production,  domestic  sales  and  export  sales  associated 
with, for instance, that name change or that change in the production and sales entities. 

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If  appropriate,  the  Regulation  will  accordingly  be  amended  by  updating  the  list  of 
companies benefiting from individual duties. 

In  order  to  ensure  a  proper  enforcement  of  the  anti-dumping  duty,  the  residual  duty 
level  should  not  only  apply  to  the  non-cooperating  exporters,  but  also  to  those 
companies which did not have any exports during the IP.  

It should be noted that the Indian exporter MTZ changed its address with effect from 
July 2005, with no other changes to the company’s ownership, structure or operations. 
The address of the company should therefore be amended. 

(64) 

(65) 

(66)  For the purpose of transparency and having regard to Regulation XXX/2006, adopted 
on the same day as this Regulation and also concerning a review of the definitive anti-
dumping measures, a new consolidated version of Article 1 of Regulation 1676/2001 
should be included in the operative part of this Regulation, 

HAS ADOPTED THIS REGULATION: 

Article 1 

Article 1 of Regulation (EC) No 1676/2001 shall be replaced by the following: 

1. 

2. 

A  definitive  anti-dumping  duty  is  hereby  imposed  on  imports  of  polyethylene 
terephthalate (PET) film falling within CN codes ex 3920 62 19 ( TARIC codes 3920 
62 19 03, 3920 62 19 06, 3920 62 19 09, 3920 62 19 13, 3920 62 19 16, 3920 62 19 
19, 3920 62 19 23, 3920 62 19 26, 3920 62 19 29, 3920 62 19 33, 3920 62 19 36, 
3920 62 19 39, 3920 62 19 43, 3920 62 19 46, 3920 62 19 49, 3920 62 19 53, 3920 
62 19 56, 3920 62 19 59, 3920 62 19 63, 3920 62 19 69, 3920 62 19 76 and 3920 62 
19  94)  and  ex  3920  62  90  (TARIC  codes  3920  62  90  33  and  3920  62  90  94)  and 
originating in India and the Republic of Korea. 

The  rate  of  the  definitive  anti-dumping  duty  applicable  to  the  net,  free-at-
Community-frontier  price,  before  duty,  shall  be  as  follows  for  products  originating 
in: 

Country 

Company 

India 

India 

Ester Industries Limited 
75-76, Amrit Nagar,  
Behind South Extension Part-1,  
New Delhi - 110 003, 
India 
Flex Industries Limited  
A-1, Sector 60,  
Noida 201 301, (U.P.), 
India  

Definitive 
Duty 
(%) 
17,3% 

TARIC 
Additional 
Code 
A026 

0,0% 

A027 

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India 

India 

India 

India 

Garware Polyester Limited 
Garware House,  
50-A, Swami Nityanand Marg,  
Vile Parle (East),  
Mumbai 400 057, 
India 

Jindal Poly Films Limited 
56 Hanuman Road, 
New Delhi 110 001, 
India  

MTZ Polyfilms Limited  
New India Centre, 5th floor,  
17 Co-operage Road,  
Mumbai 400 039, 
India 
Polyplex Corporation Limited  
B-37, Sector-1,  
Noida 201 301,  
Dist. Gautam Budh Nagar, Uttar 
Pradesh, 
India 

17,4% 

A028 

0,0% 

A030 

18,0% 

A031 

0,0% 

A032 

India 

All other companies 

17,3% 

A999 

Korea 

Korea 

Korea 

Korea 

Kolon Industries Inc. 
Kolon Tower, 
1-23, Byulyang-dong, 
Kwacheon-city, Kyunggi-do, 
Korea 

SKC Co. Ltd. 
Kyobo Gangnam Tower, 
1303-22, Seocho 4 Dong, 
Seocho Gu, 
Seoul 137-074, 
Korea 

Toray Saehan Inc. 
17F, LG Mapo B/D 
275 Kongdug-Dong 
Mapo-Gu 
Seoul 121-721 
Korea 

HS Industries Co. Ltd. 
Kangnam Building, 5th floor 
1321, Seocho-Dong 
Seocho-Ku 
Seoul 
Korea 

0,0% 

A244 

7,5% 

A224 

0,0% 

A222 

7,5% 

A226 

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Korea 

Korea 

Hyosung Corporation 
450, Kongduk-Dong 
Mapo-Ku 
Seoul 
Korea 

KP Chemical Corporation 
No. 89-4, Kyungun-Dong 
Chongro-Ku 
Seoul 
Korea 

7,5% 

A225 

7,5% 

A223 

Korea 

All other companies 

13,4% 

A999 

3. 

Where any party provides sufficient evidence to the Commission 

– 

– 

– 

that  it  did  not  export  the  goods  described  in  Article  1(1)  during  the  original 
investigation period  

that  it  is  not  related  to  any  exporter  or  producer  subject  to  the  measures 
imposed by this Regulation and  

that it has exported the goods concerned after the investigation period, or that it 
has  entered  into  an  irrevocable  contractual  obligation  to  export  a  significant 
quantity to the Community,  

then  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  that  party  to  the  list  of  companies  subject  to  anti-dumping  measures  as 
appears in the table in Article 1(2). 

4. 

Unless  otherwise  specified,  the  provisions  in  force  concerning  customs  duties  shall 
apply.  

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

Article 2 

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

Done at Brussels,  

For the Council 
The President 

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