Proposal for a Council Regulation imposing a definitive anti-dumping duty on imports of dead-burned (sintered) magnesia originating in the People's Republic of China
Date: 2006-04-12
Institutions: European Commission
Subjects: China, anti-dumping duty, anti-dumping legislation, import, magnesium, originating product

COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 12.4.2006 
COM(2006) 165 final 

Proposal for a 

COUNCIL REGULATION 

imposing a definitive anti-dumping duty on imports of dead-burned (sintered) magnesia 
originating in the People's Republic of China 

(presented by the Commission) 

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EXPLANATORY MEMORANDUM 

1. 

110 

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 
('basic  Regulation'),  in  the  proceeding  concerning  imports  of  dead-burned  (sintered) 
magnesia originating in 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 

Council Regulation (EC) No 360/2000 of 14 February 2000 imposing a definitive anti-
dumping  duty  on  imports  of  dead-burned  (sintered)  magnesia  originating  in  the 
People's  Republic  of  China,  Regulation  as  last  amended  by  Council  Regulation  (EC) 
No 986/2003 of 5 June 2003. 

Proposal  for  a  Regulation  prolonging  the  measures  imposed  by  Council  Regulation 
(EC) No 360/2000. 

141 

• 

Consistency with the other policies and objectives of the Union 

Not applicable. 

2. 

CONSULTATION OF INTERESTED PARTIES AND IMPACT ASSESSMENT 

• 

Consultation of interested parties 

219 

229 

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. 

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230 

• 

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. 

305 

LEGAL ELEMENTS OF THE PROPOSAL 

• 

Summary of the proposed action 

On  15  February  2005,  the  Commission  initiated  an  expiry  review  of  the  measures  in 
force  in  respect  of  imports  of  dead-burned  magnesia  originating  in  the  People's 
Republic  of  China,  after  receipt  of  a  request  made  by  the  Community  producers, 
indicating that the expiry of the measures would be likely to lead to a continuation or 
recurrence of injurious dumping. 

The attached proposal for a Council Regulation is based on the findings on dumping, 
injury  and  Community  interest  and  on  the  analysis  of  the  possible  effects  of  the 
removal or maintenance of the measures in force. 

The  investigation  confirmed  the  continuation  of  dumping  and  a  likelihood  of 
recurrence of injury resulting therefrom, should the measures be repealed in respect of 
the country concerned. 

The Member States were consulted regarding this review. 

It is, therefore, proposed that the Council adopt the attached proposal for a Regulation 
by which the existing measures would be maintained. 

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 2117/2005 of 21 December 2005. 

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). 

331 

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

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332 

341 

342 

4. 

409 

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(s). 

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

BUDGETARY IMPLICATION 

The proposal has no implication for the Community budget. 

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Proposal for a 

COUNCIL REGULATION 

imposing a definitive anti-dumping duty on imports of dead-burned (sintered) magnesia 
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 the Council Regulation (EC) No 384/96 of 22 December 1995 on protection 
against  dumped  imports  from  countries  not  members  of  the  European  Community1 
(hereinafter  referred  to  as  the  ‘basic  Regulation’),  and  in  particular  Articles  9  and  11(2) 
thereof, 

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

Whereas: 

1. 

Measures in force 

A. PROCEDURE 

(1) 

(2) 

(3) 

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In  December  1993,  definitive  anti-dumping  measures  on  imports  of  dead-burned 
(sintered)  magnesia  (‘DBM’  or  ‘the  product  concerned’)  originating  in  the  People’s 
Republic  of  China  (‘PRC’)  were  imposed  by  Council  Regulation  (EC)  No  3386/932 
(‘original investigation’). These measures took the form of a minimum import price. 

Following  an  expiry  review,  these  anti-dumping  measures  were  maintained  in 
February 2000 by Council Regulation (EC) No 360/20003. 

Following an interim review, the Council, by Regulation (EC) No 986/20034, amended 
the form of the anti-dumping measures in force by maintaining the minimum price but 
subject to specific conditions and imposing an ad valorem duty of 63,3% in all other 
cases. 

OJ L 56, 6.3.1996, p. 1, Regulation as last amended by Council Regulation (EC) No 2117/2005 (OJ L 
340, 23.12.2005, p. 17). 
OJ L 306, 11.12.1993, p. 16. 
OJ  L  46,  18.2.2000,  p.  1.  Regulation  as  last  amended  by  Regulation  (EC)  No  986/2003  (OJ  L  143, 
11.6.2003, p. 5). 
OJ L 143, 11.6.2003, p. 5. 

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2. 

Request for a review 

(4) 

(5) 

(6) 

Following  the  publication  of  a  notice  of  impending  expiry  of  the  anti-dumping 
measures  in  force  on  imports  of  DBM  originating  in  the  PRC5,  the  Commission’s 
services  received  a  request  in  November  2004  to  review  these  measures  pursuant  to 
Article 11(2) of the basic Regulation. 

The  request  was  lodged  by  Eurométaux,  acting  on  behalf  of  Community  producers 
(hereinafter referred to as the ‘applicant producers’) representing a major proportion, 
in this case more than 50%, of the total Community production of DBM. 

The request was based on the grounds that the expiry of the measures would be likely 
to  result  in  a  continuation  or  recurrence  of  dumping  and  injury  to  the  Community 
industry.  Having  determined,  after  consultation  of  the  Advisory  Committee,  that 
sufficient evidence existed for the initiation of a review, the Commission initiated an 
investigation6  pursuant to Article 11(2) of the basic Regulation. 

3. 

Investigation 

(7) 

(8) 

(9) 

(10) 

The Commission's services officially advised the applicant Community producers, the 
other Community producers, the exporting producers in the PRC (hereinafter ‘Chinese 
exporters’), the importers, traders, users and their associations known to be concerned, 
as  well  as  the  representatives  of  the  government  of  the  exporting  country,  of  the 
initiation of the review. 

The  Commission’s  services  sent  questionnaires  to  all  these  parties  and  to  those  who 
made themselves known within the time limit set in the notice of initiation. 

The Commission’s services also gave the parties directly concerned the opportunity to 
make their views known in writing and to request a hearing within the time limit set 
out in the notice of initiation. 

In view of the apparent high number of exporting producers in the PRC and importers 
of  the  product  concerned,  sampling  was  envisaged  in  the  notice  of  initiation,  in 
accordance  with  Article  17  of  the  basic  Regulation.  In  order  to  be  able  to  decide 
whether sampling would be necessary and, if so, to select a sample, the Commission’s 
services sent out sampling forms asking specific information on average sales volume 
and prices of each exporting producer and importer concerned. No reply was received 
from any exporting producer, and only three replies were received from importers. It 
was therefore decided that sampling was not necessary. 

(11) 

In  addition,  questionnaires  were  sent  to  producers  in  potential  analogue  countries, 
namely Brazil, Canada and Turkey, which were known to the Commission’s services. 

(12)  All  the  applicant  Community  producers  replied  to  the  questionnaire.  No  Chinese 
exporting  producer  and  no  importer  replied  to  the  questionnaire.  However,  two 

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6 

OJ C 215, 27.8.2004, p. 2.  
OJ C 38, 15.2.2005, p. 2. 

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importers made their views known in writing. One user submitted a partial reply to the 
questionnaire. 

(13)  The Commission’s services sought and verified all information deemed necessary for 
the purpose of a determination of the likely continuation or recurrence of dumping and 
injury  and  of  the  Community  interest.  Verification  visits  were  carried  out  at  the 
premises of the following companies: 

(a) applicant Community producers: 

— Grecian Magnesite SA, Athens, Greece 

— Magnesitas Navarras, S.A., Pamplona, Spain; 

— Slovenské Magnezitové Závody a.s., Jelšava, Slovakia; 

(b) producer in the analogue country: 

— Kümaş Kütahya Manyezit Işletmeleri Pazarlama A.Ş., Kütahya, Turkey. 

4. 

Investigation period 

(14)  The investigation of continuation or recurrence of dumping covered the period from 1 
January 2004 to 31 December 2004 (hereinafter referred to as ‘IP’). The examination 
of the trends relevant for the assessment of a likelihood of a continuation or recurrence 
of injury covered the period from 1 January 2000 up to the end of the IP (the period 
considered). 

B. PRODUCT CONCERNED AND LIKE PRODUCT 

1. 

Product concerned 

(15)  The product concerned is the same as that in the previous investigations which led to 
the  imposition  of  measures  currently  in  force,  i.e.  natural  dead-burned  magnesia 
originating in the PRC and falling within CN code 2519 90 30. 

(16)  DBM is processed from magnesite, that is naturally occurring magnesium carbonate. 
In order to produce DBM, magnesium carbonate has to be mined, crushed, sorted and 
then burned in a kiln at temperatures of 1 500 to 2 000° C. The result is DBM with a 
MgO  (magnesium  oxide)  content  ranging  from  80  to  98%.  The  main  impurities  in 
DBM  are  SiO2,  Fe2O3,  Al2O3,  CaO  and  B2O3  (silicon  oxide,  iron  oxide,  aluminium 
oxide,  calcium  oxide  and  boron  oxide  respectively).  DBM  is  mainly  used  in  the 
refractory  industry  to  make  formed  and  unformed  refractories.  Although  there  are 
different  types  of  the  product  concerned  with  e.g.  various  content  of  MgO,  they  all 
share  the  same  basic  chemical  and  physical  characteristics  and  uses  and  are 
interchangeable. Therefore, as in the previous investigation, all grades of DBM should 
be considered to form one single product for the purpose of this investigation. 

2. 

Like product 

(17)  As established in the previous investigations, this review investigation has confirmed 
that  the  products  exported  by  the  PRC  and  those  manufactured  and  sold  on  the 

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domestic  market  of  the  PRC,  as  well  as  those  manufactured  and  sold  by  the 
Community producers on the Community market and by the producer in the analogue 
country on the domestic market of the analogue country have the same basic physical 
and  chemical  characteristics  and  end  uses  and  are  therefore  considered  to  be  like 
products within the meaning of Article 1(4) of the basic Regulation. 

C. LIKELIHOOD OF A CONTINUATION OF DUMPING 

(18) 

In accordance with Article 11(2) of the basic Regulation, it was examined whether the 
expiry of the measures would be likely to lead to a continuation of dumping. 

1. 

Preliminary remarks 

(19) 

In the absence of  cooperation  either  from any of the Chinese exporting producers or 
from any importer in the Community, this examination had to be based on information 
available  to  the  Commission’s  services  from  other  sources.  In  this  respect  and  in 
accordance  with  the  provisions  of  Article  18  of  the  basic  Regulation,  Eurostat  data 
referring  to  the  8-digit  CN  code,  checked  with  other  sources,  were  used  in  order  to 
establish import quantities and prices. 

(20)  Based on the Eurostat data, it was found that during the IP 369 079 tonnes of DBM 
were  imported  from  the  PRC  into  the  Community,  i.e.  approximately  40%  of  the 
Community consumption. 

(21)  During the IP of the previous expiry review, the import volume of Chinese DBM into 

the Community amounted to 260 967 tonnes, i.e. 54% of Community consumption. 

(22) 

It should be noted that, as the Community expanded to the 25 Member States, export 
volumes  and  export  market  shares  of  the  previous  and  the  current  expiry  reviews 
cannot be directly compared. 

2. 

Dumping of imports during the investigation period 

(23) 

In accordance with Article 11(9) of the basic Regulation, the Commission’s services 
used the same methodology as in the previous investigation. It is recalled that in the 
previous investigation, a dumping margin in the order of 50% was established. 

Analogue country 

(24) 

In calculating normal value account was taken of the fact that for this investigation the 
normal  value  for  imports  from  the  PRC  had  to  be  based  on  data  from  a  market 
economy third country in accordance with Article 2(7)(a) of the basic Regulation. In 
the notice of initiation Turkey was envisaged as an appropriate market economy third 
country.  An  unrelated  importer  submitted  that  Turkey  was  inappropriate  on  the 
grounds that the access to raw materials in Turkey was more difficult than in the PRC: 
magnesite mines in Turkey do not enjoy the same natural advantages as in the PRC so 
the extracting and processing costs were higher than in Chinese mines. Moreover, the 
same  importer  claimed  that  the  Turkish  domestic  market  was  too  small  to  be 
representative  for  the  Chinese  market.  This  importer  suggested  Brazil  or  Canada  as 
more appropriate potential market economy third countries. 

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(25)  The  Commission's  services  examined  whether  Turkey,  which  was  already  used  as 
market  economy  third  country  in  the  previous  investigation,  was  still  a  reasonable 
choice. In particular, it was found that at least three Turkish companies produced and 
sold DBM in Turkey in significant quantities in competition with each other and with 
imports from other countries. The question of access to raw materials being easier in 
the  PRC  than  in  Turkey  was  addressed  in  the  original  investigation  and  no  new 
evidence  was  submitted  to  change  the  conclusion  that  Turkey  was  an  appropriate 
market economy third country. Insofar as such differences were shown to exist, these 
could  be  taken  into  account  by  making  the  necessary  adjustments.  One  Turkish 
producer agreed to cooperate. 

(26)  The proposal of Brazil and Canada as potential analogue country was also taken into 
account and anti-dumping questionnaires were sent to all known producers of DBM in 
these  countries.  However,  no  responses  were  received  and  thus  no  information  was 
available  to  the  Commission’s  services  on  sales  prices  and  costs  of  production  for 
DBM in Canada and Brazil. Therefore, no further consideration could be given to the 
use of Brazil and Canada as analogue countries. 

(27) 

It  was  therefore  concluded  that  Turkey  was  an  appropriate  analogue  country  for  the 
purpose of establishing the normal value. 

Normal value 

(28) 

In  accordance  with  Article  2(4)  of  the  basic  Regulation,  it  was  considered  whether 
sufficient domestic sales of the product concerned had been made by the producer in 
Turkey in the ordinary course of trade. As the volume of profitable transactions was 
higher  than  80%,  and  the  weighted  average  price  was  above  the  cost  of  production 
plus  selling,  general  and  administrative  costs,  normal  value  was  established  on  the 
basis of the weighted average prices actually paid for sales of the product concerned 
on  the  domestic  Turkish  market.  In  accordance  with  Article  18  of  the  basic 
Regulation,  and  in  the  absence  of  any  cooperation  from  Chinese  exporters,  the 
weighted  average  sales  price  of  the  Turkish  producer  was  used  as  there  was  no 
information as to the product types imported from the PRC into the Community and 
no information was available that suggested that the product mix of Chinese exports to 
the Community and Turkish domestic sales was substantially different. 

Export price 

(29)  Given the lack of cooperation from the Chinese exporters, the export price had to be 
based  on  facts  available  in  accordance  with  Article  18  of  the  basic  Regulation. 
Eurostat figures were chosen as the appropriate basis for establishing the export price. 
The Eurostat average price levels were confirmed by reference to information obtained 
from the one cooperating user. 

Comparison 

(30)  The  weighted  average  normal  value  was  compared  to  the  weighted  average  export 
price  of  DBM,  in  accordance  with  Article  2(11)  of  the  basic  Regulation,  both  at  ex 
works level. 

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(31)  For the purpose of ensuring a fair comparison between normal value and export price, 
account  was  taken  for  differences  in  factors  affecting  price  comparability  in 
accordance  with  Article  2(10)  of  the  basic  Regulation.  In  this  respect,  adjustments 
were  made  for  inland  and  ocean  freight,  insurance,  handling,  loading  and  ancillary 
costs. 

(32) 

In the previous investigation it was accepted that access to raw materials was easier in 
the  PRC  than  in  Turkey.  As  no  information  was  submitted  to  indicate  that  this 
situation  had  changed,  an  allowance  was  granted  in  order  to  take  into  account  the 
difference in extraction rates between the two countries. The same adjustment to the 
normal  value  was  applied  as  in  the  previous  investigation,  i.e.  a  reduction  of  the 
normal value corresponding to 20% of the extraction costs found for the cooperating 
Turkish producer. 

(33)  Furthermore, as in the previous investigations, it was considered that the purity of the 
PRC raw material was higher than that of the Turkish raw material. In the absence of 
any  information  submitted  indicating  any  change  in  this  respect,  an  adjustment 
corresponding to 25% of the cost of manufacturing found for the cooperating Turkish 
producer was therefore made to take account of this difference. 

Dumping margin 

(34)  The comparison of normal value and export price showed the existence of dumping, 
the dumping margin being equal to the amount by which normal value, so established, 
exceeded  the  price  for  export  to  the  Community.  The  dumping  margin  found,  as  a 
percentage of the CIF Community-frontier import price, was in the order of 35%. 

3. Developments of imports should measures be repealed 

Preliminary remarks 

(35)  Further to the analysis of the existence of dumping during the IP, the likelihood of the 
continuation of dumping was also examined. In the absence of cooperation from any 
Chinese  exporting  producer  and  as  little  public  information  about  the  Chinese  DBM 
industry was available, the conclusions below rely mainly on facts available, namely 
the market research information submitted by the applicant producers or found during 
the  investigation  and  deemed  reliable,  together  with  data  from  Eurostat,  the  Japan 
Trade Statistics and the US bureau of the Census. 

Chinese production capacity 

(36)  According  to  the  expiry  review  request,  Chinese  producers  have  substantial  spare 
production  capacity  as  they  have  the  largest  magnesite  ore  resource  in  the  world, 
estimated  at  1  300  million  tonnes.  The  total  Chinese  production  capacity  for  the 
product  concerned  is  estimated  at  around  3,5  million  tonnes  per  year,  whereas  the 
Chinese  domestic  consumption  is  estimated  at  some  1,2  to  1,5  million  tonnes  and 
exports of around 1 million tonnes per year. This indicates that the Chinese production 
could be rapidly increased further by Chinese exporters. 

Chinese export prices to the Community 

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(37)  According to Eurostat figures, the export price of Chinese DBM to the Community has 
dropped  by  10%  between  2000  and  the  IP,  whereas  measures  were  in  force.  The 
average export price of DBM nevertheless remained above the minimum import price 
imposed. 

Exports to third countries 

(38) 

Japan and the USA were two of the main export markets of China for DBM during the 
period considered. 

(39)  Between  2000  and  the  IP,  prices  of  Chinese  exports  to  Japan  fell  by  approximately 
7%, from Yen 20 054 per tonne to Yen 19 513 per tonne, while quantities remained 
stable overall between 2000 and the IP, at around 270 000 tonnes. The export prices to 
Japan,  expressed  in  euro,  were  EUR  202  per  tonne  and  EUR  145  per  tonne 
respectively in 2000 and during the IP. 

(40)  Although still higher than export prices to the EC, the export prices to Japan were thus 
much closer to export prices to the EC at the end of the period considered than at the 
beginning.  Therefore,  during  the  period  considered,  exports  to  the  EC  became  more 
attractive  to  Chinese  exporters  compared  to  exports  to  Japan,  and  Chinese  exporters 
have had an incentive to export larger volumes to the EC. 

(41)  Between  2000  and  the  IP,  prices  of  Chinese  exports  to  the  USA  increased 
considerably,  from  USD  129  per  tonne  to  208  USD  per  tonne  during  the  IP,  which 
corresponds to EUR 140 per tonne and EUR 167 per tonne, respectively. 

(42) 

In  respect  of  this  huge  increase  in  export  prices  to  the  USA,  it  has  to  be  noted  that 
during the period considered all US producers of natural DBM stopped gradually their 
activity,  and  that  Chinese  imports  of  DBM  dominated  the  US  market.  Indeed,  they 
accounted  for  around  82%  of  the  consumption  of  dead-burned  magnesia  in  the  US 
during the IP. 

(43)  With  comparatively  high  prices,  in  particular  in  view  of  the  higher  price  level  of 
exports  to  the  USA  than  to  the  EC,  the  US  market  may  thus  have  become  more 
attractive  to  Chinese  exporters  of  DBM  during  the  period  considered.  However,  the 
export quantities of DBM to the USA did not increase overall between the beginning 
of  the  period  considered  and  the  IP,  and  remained  around  340  000  tonnes  per  year. 
Thus, it does not appear likely that Chinese exporters would still increase significantly 
their volumes of exports of DBM to the USA in the near future. 

(44) 

In any event, in view of the significant spare capacity of the producers in the PRC, it is 
unlikely that third countries could absorb an increase of Chinese exports. If measures 
were allowed to lapse, Chinese exporters would therefore have an incentive to increase 
exports to the Community. 

Likely evolution of Chinese exports to the Community 

(45)  Bearing in mind that no Chinese exporting producer cooperated with the investigation, 
the analysis of the evolution of Chinese exports to the Community was based on facts 
available in accordance with Article 18. 

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(46)  The  trends  observed  during  the  period  considered  show  big  annual  variations  in 

average volumes and unit prices of the Chinese exports to the Community. 

(47)  Concerning  prices,  as  mentioned  above,  the  overall  decrease  in  prices  during  the 
period considered was 10%, but a substantial decrease (-24%) has occurred in the last 
years of the period considered, namely between 2001 and 2004. 

(48)  As  to  volumes,  it  was  pointed  out  above  that  the  Chinese  exporters  would  have  an 
incentive to  further  increase their export volumes to the EU in  view of the available 
spare  capacity  and  the  limited  possibilities  to  increase  exports  to  third  countries. 
Furthermore,  while  the  overall  evolution  during  the  period  considered  showed  an 
increase  of  6%,  considerable  increases  have  occurred  in  the  last  years  of  the  period 
considered (+36% between 2001 and 2004). 

(49)  As  there  is  no  indication  that  the  trends  observed  during  the  last  years  of  the  period 
considered would not continue, the information available shows that a further decrease 
in prices and a further increase in volume are likely to happen. Indeed, the expected 
further increase of Chinese exports to the EC would probably be made at the expense 
of  the  Community  industry,  in  other  words  at  prices  at  or  even  below  the  current 
dumped price levels in order to gain market share. 

(50)  Furthermore,  it  has  to  be  pointed  out  that,  as  described  in  recital  (73)  of  Council 
Regulation (EC) No 360/2000, the Chinese export prices and quantities are currently 
influenced  by  the  export  license  system  put  in  place  by  the  Chinese  authorities, 
indicating  that,  should  this  system  be  abolished,  the  Chinese  exporters  have  the 
potential to raise their export volume and to lower their export price. 

Conclusion on the likelihood of a continuation of dumping 

(51)  The investigation showed that the Chinese exporters continued their dumping practices 
during  the  IP  at  significant  level.  Given  the  fact  that  China  has  considerable  spare 
production  capacity  and  that  the  EC  may  have  become  a  more  attractive  market  for 
Chinese  exporters  than  in  the  past  as  compared  to  other  markets,  there  is  a  strong 
likelihood  that  dumping,  at  the  very  least  at  similar  levels,  would  continue  if  the 
existing  measures  were  repealed.  Moreover,  there  is  a  likelihood  that  the  volume  of 
dumped  imports  would  significantly  increase  and  that  their  price  would  decrease  if 
existing measures were repealed. 

D. DEFINITION OF THE COMMUNITY INDUSTRY 

(52)  During the IP there were five producers of DBM in the Community. The investigation 
established  that  the  three  applicant  and  fully  cooperating  Community  producers 
represented  around  55%  of  the  Community  production  of  DBM  and,  therefore, 
constitute the Community industry within the meaning of Article 4(1) and Article 5(4) 
of the basic Regulation. 

(53)  One  producer  did  not  cooperate,  but  did  also  not  oppose  the  investigation.  It  was 
shown  that  this  producer  is  a  completely  downstream  integrated  producer,  using  its 
output of DBM exclusively for internal consumption. 

EN 

12 

   EN 

 
(54)  Another producer was known to the Commission and was contacted in the framework 
of this proceeding. This company did not express its support or oppose the proceeding. 

E. DETERMINATION OF THE RELEVANT COMMUNITY MARKET 

(55) 

In  order  to  establish  whether  or  not  the  Community  industry  suffered  injury  and  to 
determine consumption and the various economic indicators related to the situation of 
the Community industry, it was examined whether and to what extent the subsequent 
use of the Community industry’s production of the like product had to be taken into 
account in the analysis. 

(56)  DBM is used as an input in the production of refractories within the same companies, 

or is sold as such to a third party, related or not. 

(57)  For  the  purpose  of  this  investigation,  captive  use  was  defined  as  occurring  when 
production was delivered within the same group of companies for further downstream 
processing. In situations of captive use, sales or transfer of costs were made at transfer 
value not set according to market conditions or were made to a company which did not 
have  a  free  choice  of  supplier.  Consequently,  captive  use  had  to  be  analysed  at  the 
level of produced quantities and the proportion of total sales it represented. All other 
situations were considered as free market sales. 

(58)  The  distinction  between  the  captive  and  the  free  market  is  relevant  for  the  injury 
analysis  because  products  destined  for  captive  use  are  not  exposed  to  direct 
competition with imports. By contrast, production destined for free market sales was 
found to be in direct competition with imports of the product concerned. 

(59) 

In order to provide as complete a picture as possible of the situation of the Community 
industry, data have been obtained and analysed for the entire DBM activity and it was 
subsequently  determined  whether  the  production  was  destined  for  captive  use  or  for 
the free market. 

(60)  On the basis of the investigation, it was found that certain economic indicators related 
to  the  Community  industry  could  reasonably  be  examined  by  referring  to  the  whole 
activity, i.e. for both captive use and free market sales. Indeed, production, production 
capacity  and  capacity  utilisation,  cash  flow,  investments,  ability  to  raise  capital, 
stocks,  employment,  labour  costs  and  productivity  depend  upon  the  whole  activity, 
regardless  of  whether  the  product  is  transferred  downstream  within  a  group  of 
companies for further processing or whether it is sold on the free market. 

(61)  The other economic indicators related to the Community industry were analysed and 
evaluated referring to the situation prevailing on the free market, in particular where 
measurable  market  conditions  exist  and  where  transactions  are  made  under  normal 
market conditions implying free choice of supplier: sales volume and sales prices on 
the  Community  market,  export  volume  and  prices.  In  this  respect,  consumption, 
market  shares,  growth  as  well  as  profitability  and  return  on  investment  were 
determined on the basis of the free market sales. 

EN 

13 

   EN 

 
F. SITUATION IN THE COMMUNITY MARKET 

1. Consumption in the Community market 

(62)  Community  consumption  was  based  on  the  combined  volume  of  sales  made  by  the 
Community industry in the Community, excluding captive use, imports from the PRC 
and imports from other third countries. 

(63)  On  this  basis,  during  the  period  considered,  Community  consumption  increased  by 
32%, from 693 145 tonnes in 2000 to 911 672 tonnes in the IP. This was partially due 
to the recovery of the steel industry. 

TABLE 1 – Community consumption 

Community consumption 

2000 

2001 

2002 

2003 

IP 

Free market (tonnes) 

693 145 

792 575 

701 723 

817 678 

911 672 

Index 

Y/Y trend 

100 

114 

14 

101 

-13 

118 

17 

132 

14 

Source:  EUROSTAT,  verified  questionnaire  replies  of  the  Community  industry  and  market 
information provided by the applicant producers 

(64)  For the purpose of completing the information provided for Community consumption 
on  the  free  market,  the  consumption  for  captive  use  was  also  calculated,  based  on 
verified  questionnaire  replies  of  the  Community  industry  and  on  market  information 
provided by the applicant producers. It was found that the consumption for captive use 
increased by 12% during the period considered. 

TABLE 2 – Captive use 

Captive use 

2000 

2001 

2002 

2003 

IP 

Quantity (tonnes) 

394 191 

399 839 

404 773 

417 495 

442 131 

Index 

Y/Y trend 

2. Import from the PRC 

Volume and market share 

100 

101 

1 

103 

2 

106 

3 

112 

6 

(65)  Volumes  imported  from  the  PRC  did  not  follow  the  same  trend  as  Community 
consumption.  They  decreased  first  by  25%  on  average  from  2000  to  2002,  and  then 
increased  between  2002  and  the  IP  by  41%.  Overall,  during  the  period  considered 
imports from the PRC increased by 6%, from 349 561 tonnes to 369 079 tonnes. 

EN 

14 

   EN 

 
 
 
TABLE 3 – Imports from the PRC 

Imports from the PRC 

2000 

2001 

2002 

2003 

IP 

Tonnes 

Index 

Y/Y trend 

Source: EUROSTAT 

349 561 

271 147 

261 460 

351 724 

369 079 

100 

78 

-22 

75 

-3 

101 

26 

106 

5 

(66)  The market share of the Chinese imports, expressed as a percentage of the Community 
consumption on the free market, decreased from 50% in 2000 to 40% in the IP. 

TABLE 4 – Market share of the imports from the PRC 

Market share of the imports from the PRC  2000 

Percentage of free market 

Index 

Y/Y trend 

50% 

100 

2001 

34% 

68 

-32 

2002 

2003 

IP 

37% 

43% 

40% 

74 

6 

85 

11 

80 

-5 

Source: EUROSTAT and verified questionnaire replies of the Community industry 

Price evolution of the imports and undercutting 

(67)  The  average  CIF  Community-frontier  import  price  from  the  PRC  increased  by  14% 
between 2000 and 2002 but decreased sharply between 2002 and the IP, by 22%. Over 
the whole period considered, it decreased by 10% and reached EUR 140 per tonne in 
the IP. 

TABLE 5 – Average import price from the PRC 

Average import price from the PRC 

2000 

2001 

2002 

2003 

EUR/tonne 

Index 

Y/Y trend 

Source: EUROSTAT 

156 

100 

184 

118 

18 

179 

114 

-3 

138 

88 

-26 

IP 

140 

90 

2 

(68)  The  Commission  has  examined  whether  the  exporting  producers  in  the  country 
concerned  undercut  the  prices  of  the  Community  industry  during  the  IP.  In  order  to 
bring  prices  to  a  comparable  basis,  the  Community  producer’s  prices  have  been 
adjusted to an ex-works level. 

(69)  The undercutting margin found on this basis was 7,6%. 

EN 

15 

   EN 

 
 
 
 
3. Economic situation of the Community industry 

(a) Analysis of the factors pertinent to the entire activity, including captive use 

Production, production capacity and capacity utilisation 

(70)  The Community industry’s production increased by 11% during the period considered, 
following  to  some  extent  the  trend  of  the  Community  consumption.  The  decrease  of 
the  production  by  3  percentage  points  in  2002  coincided  with  the  contraction  of  the 
consumption of DBM in the Community market. 

TABLE 6 – Production volume 

Production volume 

2000 

2001 

2002 

2003 

Index 

Y/Y trend 

100 

101 

1 

98 

-3 

108 

10 

IP 

111 

3 

Source: Verified questionnaire replies of the Community industry 

(71)  During the period considered, the production capacity of the Community industry first 
remained stable between 2000 and 2002 and then increased by 3% between 2002 and 
the IP. 

TABLE 7 – Production capacity 

Production capacity 

2000 

2001 

2002 

2003 

Index 

Y/Y trend 

100 

100 

0 

100 

0 

103 

3 

IP 

103 

0 

Source: Verified questionnaire replies of the Community industry 

(72)  During the period considered, the capacity utilisation followed the same trend as the 
Community  production  and  consumption.  Capacity  utilisation  decreased  by  2% 
between 2000 and 2002 but increased after 2002, so that over the period considered it 
increased by 7%. 

TABLE 8 – Capacity utilisation 

Capacity utilisation 

2000 

2001 

2002 

2003 

Index 

Y/Y trend 

100 

101 

1 

98 

-3 

105 

7 

IP 

107 

2 

Source: Verified questionnaire replies of the Community industry 

Cash flow 

(73)  The cash flow fluctuated during the period considered. However, it remained overall at 

the same level (-1%). 

EN 

16 

   EN 

 
 
 
 
TABLE 9 – Cash flow 

Cash flow 

Index 

Y/Y trend 

2000 

2001 

2002 

2003 

100 

127 

27 

103 

-25 

127 

25 

IP 

99 

-28 

Source: Verified questionnaire replies of the Community industry 

Investments and ability to raise capital 

(74) 

Investments  decreased  by  around  23%  during  the  period  considered.  However,  they 
remained significant and represented during the IP about 10% of the total turnover of 
the Community industry. 

TABLE 10 – Investments 

Investments 

Index 

Y/Y trend 

2000 

2001 

2002 

2003 

100 

141 

41 

79 

-62 

59 

-20 

IP 

77 

18 

Source: Verified questionnaire replies of the Community industry 

(75)  The  Community  industry  was  not  found  to  be  experiencing  difficulties  in  raising 

capital during the period considered. 

Stocks 

(76)  The table below shows that stocks increased significantly during the period considered 

by 88%. However, in absolute terms this increase is not significant. 

(77)  The  ratio  of  stocks  volume  to  production  volume,  which  attained  4%  in  2000, 

increased to around 7% in the IP. 

TABLE 11 – Stocks 

Stock volumes 

2000 

2001 

2002 

2003 

Index 

Y/Y trend 

100 

137 

37 

137 

0 

146 

9 

IP 

188 

42 

Source: Verified questionnaire replies of the Community industry 

Employment, productivity and labour cost 

(78)  After an increase of 8% between 2000 and 2002, employment decreased in 2003 and 

in the IP. Overall, it decreased by 4% during the period considered. 

EN 

17 

   EN 

 
 
 
 
TABLE 12 – Employment 

Number of employees 

2000 

2001 

2002 

2003 

Index 

Y/Y trend 

100 

106 

6 

108 

2 

104 

-4 

IP 

96 

-8 

Source: Verified questionnaire replies of the Community industry 

(79)  Against the background of the increase in production and the decrease in employment, 

productivity increased during the period considered by 15%. 

TABLE 13 – Productivity 

Productivity (tonnes/employee) 

2000 

2001 

2002 

2003 

Index 

Y/Y trend 

100 

96 

-4 

91 

-5 

104 

13 

IP 

115 

11 

Source: Verified questionnaire replies of the Community industry 

(80)  During  the  period  considered  the  labour  costs  of  the  Community  industry  gradually 

increased. The total increase between 2000 and the IP was 32%. 

TABLE 14 – Wages 

Wages 

Index 

Y/Y trend 

2000 

2001 

2002 

2003 

100 

106 

6 

111 

5 

118 

7 

IP 

132 

14 

Source: Verified questionnaire replies of the Community industry 

(b) Analysis of the factors pertinent for the free-market activity 

Sales volume, captive use and sales prices 

(81)  The  Community  industry’s  sales  to  unrelated  customers  on  the  Community  market 
decreased by 9% between 2000 and 2003, but increased during the IP, so that it overall 
increased by 3% during the period considered. 

TABLE 15 – Community industry’s sales to unrelated parties 

Community  industry’s  sales  to  unrelated 
parties 

2000 

2001 

2002 

2003 

IP 

Index 

Y/Y trend 

100 

91 

-9 

91 

0 

91 

0 

103 

12 

Source: Verified questionnaire replies of the Community industry 

EN 

18 

   EN 

 
 
 
 
 
(82)  During  the  period  considered  the  average  sales  prices  prevailing  on  the  free 
Community market of DBM charged by the Community industry gradually increased. 
The total increase between 2000 and the IP was 25%. 

TABLE 16 – Community industry’s sales price 

Community industry’s sales price 

2000 

2001 

2002 

2003 

Index 

Y/Y trend 

100 

112 

12 

117 

5 

119 

2 

IP 

125 

6 

Source: Verified questionnaire replies of the Community industry 

Market share 

(83)  The  overall  market  share  held  by  the  Community  industry  decreased  from  26%  in 

2000 to 20% in the IP. 

TABLE 17 – Market share of the Community industry’s sales 

Market share of the Community 
industry’s sales 

Percentage of free market 

Index 

Y/Y trend 

2000 

2001 

2002 

2003 

IP 

26% 

100 

21% 

23% 

20% 

20% 

80 

-20 

90 

10 

77 

-13 

78 

1 

Source: EUROSTAT and verified questionnaire replies of the Community industry 

Growth 

(84)  Whilst Community consumption increased by 32% during the period considered, the 
volume of Community industry sales on the free market increased by only 3%, and the 
Community  industry  market  share  on  the  free  market  decreased  by  6%.  Thus,  the 
growing  trend  of  the  Community  consumption  was  not  followed  by  a  corresponding 
increase in Community industry sales. 

Profitability and return on investments 

(85)  During the period considered profitability expressed as a percentage of net sales value 

to unrelated parties developed as follows: 

TABLE 18 – Profitability 

Profitability 

2000 

2001 

2002 

2003 

IP 

Percentage of net sales value 

-3,1% 

0% 

3,9% 

8,4% 

11,4% 

Source: Verified questionnaire replies of the Community industry 

EN 

19 

   EN 

 
 
 
(86)  The  Community  industry’s  profitability  followed  the  same  trend  as  Community 
industry sales prices. After a loss in 2000 and a breakeven year with no profit or loss 
in 2001, the Community industry made profit in 2002 and in the following years. The 
profitability  then  increased  from  3,9%  in  2002  to  11,4%  in  the  IP.  This  was  mainly 
due  to  a  switch  to  the  production  of  products  with  a  higher  added  value.  Over  the 
period considered, the average profit made by the Community industry was 4,5%. 

(87)  Return on investments, expressed as profits/losses in relation to the net book value of 

investments, followed the same trend as the profitability. 

TABLE 19 – Return on investments 

Return on investments 

2000 

2001 

2002 

2003 

IP 

% 

Index 

Y/Y trend 

-2,9% 

0% 

3,2% 

7,8% 

11,5% 

-100 

-1 

99 

114 

115 

275 

161 

403 

128 

Source: Verified questionnaire replies of the Community industry 

4. Effect of other factors 

Export activity of the Community industry 

(88)  The  Community  industry  exports  of  DBM  fluctuated  during  the  period  considered. 
However, overall, they remained at the same level in the IP as in 2000 (slight decrease 
of  1%).  These  exports  still  amounted  to  around  40%  of  the  total  production  of  the 
Community industry during the IP. 

TABLE 20 – Exports of the Community industry 

Exports of the Community industry 

2000 

2001 

2002 

2003 

Index 

Y/Y trend 

100 

104 

4 

95 

-9 

113 

18 

IP 

99 

-13 

Source: Verified questionnaire replies of the Community industry 

Import volumes and prices from other third countries 

(89) 

Import  volumes  of  DBM  into  the  Community  from  countries  other  than  the  PRC 
developed as follows: 

EN 

20 

   EN 

 
 
 
TABLE 21 – Imports from other third countries 

Tonnes 

Australia 

North Korea 

Turkey 

Brazil 

Russia 

South Korea 

All others 

2000 

2001 

2002 

2003 

IP 

49 032 

66 582 

42 599 

68 090 

63 043 

26 660 

71 385 

36 614 

38 245 

35 172 

43 625 

40 463 

33 446 

22 625 

42 763 

31 831 

25 916 

25 872 

25 610 

39 017 

2 520 

12 928 

8 107 

9 773 

24 380 

0 

1 528 

1 202 

1 879 

4 893 

10 376 

139 240 

129 401 

136 807 

149 284 

Total third countries 

164 044 

358 042 

277 240 

303 027 

358 552 

Index 

Y/Y trend 

100 

218 

118 

169 

-49 

185 

16 

219 

34 

Source: EUROSTAT and market information provided by the applicant producers 

(90)  The total import volumes of DBM from third countries other than the PRC more than 
doubled during the period considered, increasing from 164 044 tonnes in 2000 to 358 
552  tonnes  in  the  IP.  The  major  exporters  to  the  Community  have  been  Australia, 
North Korea, Turkey, Brazil, Russia and South Korea. 

(91)  The  market  share  of  imports  originating  in  the  third  countries  other  than  the  PRC 
increased  by  15,6  percentage  points  during  the  period  considered  and  represented 
39,3%. 

TABLE 22 – Market share of imports from other third countries 

Market  share  of  imports  from  other  third 
countries 

2000 

2001 

2002 

2003 

IP 

Percentage of free market 

23,7% 

45,2% 

39,5% 

37,1% 

39,3% 

Index 

Y/Y trend 

100 

191 

91 

167 

-24 

157 

-10 

166 

9 

Source: EUROSTAT and market information provided by the applicant producers 

EN 

21 

   EN 

 
 
 
(92)  The  average  import  prices  from  other  third  countries  were  higher  than  those  of  the 
Community industry during the IP except the import prices from North Korea, Russia 
and South Korea. It has to be noted that imports of the product concerned from those 
three  countries  represented  only  8,9%  of  all  imports  to  the  Community  during  the 
period  considered,  with  a  cumulated  market  share  in  the  Community  of  7,1%, 
compared to the market share of 40% of the PRC. 

TABLE 23 – Imports into the Community from other third countries – prices 

Imports  into  the  Community  from  other 
third countries (EUR) 

2000 

2001 

2002 

2003 

IP 

Australia 

North Korea 

Turkey 

Brazil 

Russia 

South Korea 

Others 

Source: EUROSTAT 

235 

111 

164 

182 

122 

N/A 

178 

228 

128 

181 

180 

132 

139 

223 

225 

128 

184 

200 

133 

154 

186 

213 

109 

160 

201 

119 

126 

196 

183 

128 

169 

188 

114 

132 

229 

(93)  On the basis of the above, it is considered that imports of the product concerned from 
other third countries did not have any significant impact on the economic situation of 
the Community industry during the period considered. 

5. Conclusion on the situation of the Community industry 

(94)  The measures in force have led to a partial recovery of the Community industry since 
2000. In parallel to an increase in the total Community consumption, the Community’s 
industry  managed  to  increase  the  sales  volumes  and  to  raise  the  prices.  Economic 
factors such as  production, production capacity and capacity utilisation, profitability, 
return  on  investments  and  productivity  also  showed  a  positive  development.  These 
indicators  demonstrate  that  the  Community  industry  made  efforts  to  improve  its 
competitiveness with some success: Community industry sales in the Community have 
been profitable since 2002. 

(95)  On the other hand, other indicators showed a negative development: market share of 
the  Community  industry  on  the  free  market  and  investments  decreased,  whereas 
stocks,  unit  cost  of  production  and  labour  costs  increased.  It  can  nevertheless  be 
concluded  that,  overall,  the  situation  of  the  Community  industry  has  substantially 
improved during the period considered, even if the recovery found is partial. Indeed, 
this recovery of the Community industry remains vulnerable, inter alia, as a result of 
the increasing price pressure by dumped imports from the PRC. 

EN 

22 

   EN 

 
(96) 

In view of the tentative recovery of the Community industry, the continuation of injury 
caused  by  dumped  imports  could  not  be  established.  Therefore,  it  was  examined 
whether there would be recurrence of injury if the measures lapsed. 

G. LIKELIHOOD OF RECURRENCE OF INJURY 

(97)  With regard to the likely effect on the situation of the Community industry should the 
measures in force expire, a number of factors were taken into consideration together 
with the elements summarised above. 

(98)  The  comparison  between  imports  from  the  PRC  and  other  third  countries  into  the 
Community has shown important differences in prices. Import prices from other third 
countries, except Russia, North Korea and South Korea, were higher than Community 
industry’s  sales  prices  during  the  period  considered,  while  the  average  price  of 
dumped Chinese imports decreased by 10%. 

(99)  As  regards  the  relatively  low  prices  of  imports  from  Russia,  North  Korea  and  South 
Korea, their average export prices to the EC decreased less in proportion than those of 
Chinese  exports  to  the  EC.  Furthermore,  the  volumes  imported  from  these  countries 
remained  very  low  compared  with  Chinese  imports.  The  cumulated  market  share  of 
Russia, North Korea and South Korea was 7,1% during the IP, i.e. less than a fifth of 
the market share of the PRC. Therefore, during the IP the economic effect of Chinese 
imports on the Community DBM market by far outweighed the effect of imports from 
Russia, North Korea and South Korea, and nothing indicates that this will change in 
the future. 

(100)  As  already  described  in  more  detail  in  recitals  (45)  to  (50),  if  the  anti-dumping 
measures  were  allowed  to  expire,  it  is  likely  that  imports  at  dumped  prices  of  the 
product  concerned  from  the  PRC  would  increase  and  prices  would  decrease  for  the 
following reasons: 

–  the PRC has considerable spare production capacity and has the largest magnesite 

ore resources in the world 

–  the  trends  of  prices  and  volumes  during  the  period  considered  already  show  a 

likely further decrease in prices and increase in volume 

–  the prices which Chinese exporters might charge in the absence of anti-dumping 
measures are potentially very low if it is considered that they include the export 
license fee 

–  the Community market is attractive in terms of volume, and, since exports to third 
countries are unlikely to increase to a significant extent, Chinese exporters would 
likely,  if  the  current  measures  were  allowed  to  expire,  attempt  to  increase  their 
market share in the EC by further decreasing their export price. 

(101)  It  can  be  concluded  that  the  considerable  volume  of  Chinese  imports  at  low  and 
decreasing  prices  have  exerted  an  increasing  pressure  on  the  Community  DBM 
market, which would in all likelihood continue to intensify, should the anti-dumping 
measures lapse, as import prices from the PRC would likely decrease whilst volumes 
of export would rise. The surge of imports from the PRC would very likely result in a 

EN 

23 

   EN 

 
further  decrease  in  the  Community  industry’s  market  share,  and  given  the  parallel 
evolution  of  the  Community  industry  sales  prices  and  profitability  during  the  period 
considered, the increased pressure on prices would almost certainly result in a decrease 
in  the  Community  industry’s  profit.  The  other  indicators  would  most  likely  also 
develop  negatively  once  the  Community  industry  loses  sales  and  faces  substantially 
decreasing prices. 

(102)  Furthermore,  there  does  not  appear  to  be  other  factors  likely  to  cause  injury  to  the 
Community  industry.  Imports  from  other  countries  were  either  at  higher  prices  than 
those  from  the  PRC,  or  the  volumes  concerned  were  much  smaller,  and  there  is  no 
indication that this would change in the future. 

(103)  In the light of the above, it is concluded that allowing the measures to lapse would in 
all likelihood result in a recurrence of injury to the Community industry caused by the 
dumped imports. 

H. COMMUNITY INTEREST 

1. Introduction 

(104)  According  to  Article  21  of  the  basic  Regulation,  it  was  examined  whether  a 
prolongation  of  the  existing  anti-dumping  measures  would  be  against  the  interest  of 
the Community as a whole. The determination of the Community interest was based 
on  an  appreciation  of  all  the  various  interests  involved,  i.e.  those  of  the  Community 
industry, the importers and traders as well as the users of the product concerned. 

(105)  In  order  to  assess  the  likely  impact  of  a  continuation  or  non-continuation  of  the 
measures, the Commission requested information from all interested parties mentioned 
above.  The  Commission  sent  questionnaires  to  18  importers  and  17  users  of  the 
product  concerned.  No  importers  replied  to  the  questionnaires,  even  though  two  of 
them made written representations. As to the users, one of them partially replied to the 
questionnaire. 

(106)  It should be recalled that, in the previous investigation, the adoption of measures was 
considered not to be against the interest of the Community. Furthermore, it should be 
noted  that  the  present  investigation  is  a  second  expiry  review,  thus  analysing  a 
situation  in  which  anti-dumping  measures  are  already  in  place.  Consequently,  the 
timing  and  nature  of  the  present  investigation  allows  the  assessment  of  any  undue 
negative  impact  the  current  anti-dumping  measures  may  have  had  in  the  past  on  the 
parties concerned. 

(107)  On  this  basis  it  was  examined,  whether,  despite  the  conclusions  on  continuation  of 
dumping and likelihood of recurrence of injury, compelling reasons exist which would 
lead to the conclusion that it is not in the Community interest to maintain measures in 
this particular case. 

2. Interests of the Community industry 

(108)  It  is  recalled  that  it  has  been  established  that  without  maintaining  the  anti-dumping 
measures, dumping is likely to continue with a high and increasing dumping margin, 
resulting in a deterioration of the situation  of the  Community industry, which is still 

EN 

24 

   EN 

 
not  in  a  stable,  fully  recovered  condition.  On  the  other  hand,  continuation  of  the 
measures  should  help  the  Community  industry  to  recover  fully  and  avoid  further 
injury.  Furthermore,  the  efforts  made  by  the  Community  industry  to  rationalise  its 
production  and  enhance  its  competitiveness,  and  the  profit  made  by  the  Community 
industry  in  the  last  three  years  of  the  period  considered,  show  that  the  Community 
industry is viable and competitive. 

(109)  Given  the  above,  it  appears  necessary  to  prolong  the  existing  measures  in  order  to 
avoid  the  adverse  effects  of  dumped  imports,  which  could  endanger  the  recovery 
process of the Community industry and ultimately its very existence, and consequently 
a  number  of  jobs.  It  has  also  to  be  considered  that  if  the  Community  industry 
disappears, there will also be a negative impact on the downstream industry, since the 
latter will see a significant reduction in its choice of suppliers. 

3. Interests of importers 

(110)  As stated above, none of the unrelated importers replied to the questionnaire sent by 
the Commission. The lack of cooperation is in itself an indication that this sector did 
not  suffer  any  substantial  negative  effect  on  its  economic  situation  as  a  result  of  the 
imposition of measures. This is confirmed by the fact that the importers continued to 
trade the product concerned in significant volumes, even raising the volume imported 
during the period considered. 

(111)  It  is  therefore  concluded  that  the  economic  situation  of  the  importers  of  the  product 
concerned has not been negatively influenced materially by the imposition of the anti-
dumping measures currently in force. On the same grounds, it is also unlikely that a 
continuation of the measures would lead to a deterioration of their economic situation 
in the future. 

4. Interests of users 

(112)  The  users  of  the  product  concerned,  i.e.  the  downstream  industry,  are  mainly  the 
refractories'  producers.  As  stated  above,  only  one  out  of  the  17  users  to  which  the 
questionnaire was sent by the Commission's services replied, and only partially. In the 
same way as for the importers, the low level of cooperation is in itself an indication 
that this sector did not suffer any substantial negative effect on its economic situation 
as  a  result  of  the  measures.  Although  the  representativeness  of  the  cooperating 
company for the downstream industry is limited, since it purchased less than 5% of the 
total DBM imported from the PRC during the IP, the impact of the measures in force 
on its situation was evaluated. 

(113)  In  this  respect,  the  investigation  established  that  the  cooperating  user  continued  to 
import  DBM  originating  from  the  PRC  in  spite  of  the  measures  in  force.  These 
measures  therefore  did  not  constitute  a  deterrent  for  the  producers  of  refractories 
leading  them  to  change  their  sources  of  supply.  While  DBM  constitutes  a  non 
negligible,  albeit  small,  part  of  the  cost  of  production  of  refractories,  the  Chinese 
import prices were still comparatively low, and they even decreased on average during 
the period considered. Thus, it can be concluded that the anti-dumping measures had 
no  significant  negative  influence  on  the  cost  situation  and  on  the  profitability  of  the 
users of the product concerned. 

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(114)  The cooperating user submitted that, although on the short term maintaining the anti-
dumping  measures  would  not  have  a  significant  influence  on  its  situation,  on  the 
medium  or  long  term  it  could  lead  to  more  and  more  refractories  being  produced 
outside the EC and imported into the EC instead of the raw material, DBM. 

(115)  In  this  respect,  it  has  to  be  reminded  that,  as  shown  above,  the  result  of  the  anti-
dumping measures in force has not been to close the Community market to imports of 
DBM, but rather to combat the unfair trade practices and to remedy to some extent the 
distorting  effects  of  dumped  imports.  Ensuring  a  level  playing  field  for  the 
Community industry of DBM also guarantees a higher degree of competition between 
various suppliers of DBM, including Chinese exporters of DBM, on the EC market. 

(116)  Moreover, it was found that exports from the PRC were made at higher prices to some 
other  major  markets,  including  the  US,  than  to  the  Community.  The  measures 
therefore do not appear to have caused the import prices into the Community to rise 
above  the  import  prices  to  other  third  countries.  The  claim  that  the  continuation  of 
anti-dumping measures  would affect competitiveness on  other  markets  was  therefore 
rejected. 

(117)  It was therefore concluded that, if the measures were maintained at the same level, this 

would not imply any deterioration of the situation of the users. 

5. Conclusion on Community interest 

(118)  The investigation has shown that the existing anti-dumping measures have allowed the 
Community industry to recover to a certain extent. If measures were allowed to lapse, 
this  would  endanger  the  recovery  process,  and  possibly  lead  to  the  disappearance  of 
the Community industry. Therefore, the continuation of measures is in the interest of 
the Community industry. 

(119)  Furthermore,  in  the  past,  the  existing  measures  appeared  not  to  have  any  significant 
negative effects on the economic situation of users and importers. Any price increase, 
if at all, for users resulting from the imposition of anti-dumping measures, on the basis 
of  the  information  collected  during  the  current  investigation,  does  not  appear  to  be 
disproportionate when compared to the benefit to the Community industry achieved by 
the  removal  of  the  trade  distortion  caused  by  the  dumped  imports,  as  well  as  to  the 
benefit for users of continued competition between different suppliers of DBM on the 
EC market. Therefore, it is concluded that there are no compelling reasons against the 
prolongation of the existing anti-dumping measures. 

I. 

ANTI-DUMPING MEASURES 

(120)  All parties concerned have been informed of the essential facts and considerations on 
the  basis  of  which  the  maintenance  of  the  existing  measures  is  proposed.  They  have 
been granted a period within which to make representations subsequent to disclosures. 
No comments were received which were such as to change the above conclusions. 

(121)  It  follows  from  the  above  that,  as  provided  for  by  Article  11(2)  of  the  basic 
Regulation, the variable anti-dumping duties in combination with a minimum price of 
EUR 120 per tonne on imports of DBM originating in the PRC imposed by Regulation 

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(EC)  No  360/2000,  as  last  amended  by  Regulation  (EC)  No  986/2003,  should  be 
maintained, 

HAS ADOPTED THIS REGULATION: 

Article 1 

1. 

A  definitive  anti-dumping  duty  is  hereby  imposed  on  imports  of  dead-burned 
magnesia falling within CN code 2519 90 30 originating in the People's Republic of 
China. 

2. 

The amount of the duty shall be 

(a) 

the  difference  between  the  minimum  import  price  of  EUR  120  per  tonne  and 
the  net,  free-at-Community  frontier  price,  before  duty,  in  all  cases  where  the 
latter is: 

–  less than the minimum import price, and 

–  established on the basis of an invoice issued by an exporter located in the People's 
Republic  of  China  directly  to  an  unrelated  party  in  the  Community  (Taric 
additional code A439). 

(b) 

zero, if the net, free-at-Community-frontier price, before duty, is established on 
the basis of an invoice issued by an exporter located in the People's Republic of 
China directly to an unrelated party in the Community and equal to or higher 
than  the  minimum  import  price  of  EUR  120  per  tonne  (Taric  additional  code 
A439). 

(c) 

equal  to  an  ad  valorem  duty  of  63,3%  in  all  other  cases  not  falling  under 
subparagraph (a) and (b) above (Taric additional code A999). 

In cases where the anti-dumping duty is established according to subparagraph 2(a) 
of Article 1 and where goods have been damaged before entry into free circulation 
and, therefore, the price actually paid or payable is apportioned for the determination 
of the  customs  value  pursuant to Article 145  of Commission Regulation (EEC) No 
2454/93  of  2  July  1993  laying  down  provisions  for  the  implementation  of  Council 
Regulation  (EEC)  No  2913/92  establishing  the  Community  Customs  Code7,  the 
minimum  import  price  set  out  above  shall  be  reduced  by  a  percentage  which 
corresponds  to  the  apportioning  of  the  price  actually  paid  or  payable.  The  duty 
payable  will  then  be  equal  to  the  difference  between  the  reduced  minimum  import 
price  and  the  reduced  net,  free-at-Community-frontier  price,  before  customs 
clearance. 

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

OJ  L  253,  11.10.1993,  p.  1.  Regulation  as  last  amended  by  Regulation  (EC)  No  215/2006  (OJ  L  38, 
9.2.2006, p. 11). 

3. 

4. 

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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. 

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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