Commission Regulation (EC) No 1620/2006 of 30 October 2006 imposing a provisional anti-dumping duty on imports of ironing boards originating in the People's Republic of China and Ukraine
Date: 2006-10-30
Institutions: European Commission
Subjects: China, Ukraine, anti-dumping duty, household article, import, originating product

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COMMISSION REGULATION (EC) No 1620/2006

of 30 October 2006

imposing a provisional anti-dumping duty on imports of ironing boards originating in the People's
Republic of China and Ukraine

THE COMMISSION OF THE EUROPEAN COMMUNITIES,

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
(the basic Regulation) and in
imports from countries not members of
particular Article 7 thereof,

the European Community (1)

After consulting the Advisory Committee,

Whereas:

(1)

(2)

(3)

1.1. Initiation of the proceeding

1. PROCEDURE

On 4 February 2006, the Commission announced by a notice published in the Official Journal of the
European Union (2) (notice of initiation), the initiation of an anti-dumping proceeding concerning
imports into the Community of
ironing boards originating in the People's Republic of China
(PRC) and Ukraine.

The anti-dumping proceeding was initiated following a complaint lodged on 23 December 2005 by
three Community producers (the complainants) representing a major proportion, in this case more
than 40 %, of the total Community production of ironing boards. The complaint contained evidence
of dumping of the said product and of material injury resulting therefrom, which was considered
sufficient to justify the initiation of a proceeding.

1.2. Parties concerned and verification visits

In addition,

The Commission officially advised the complainants, other known producers in the Community,
exporting producers in the PRC and Ukraine, importers and retailers known to be concerned, the
representatives of the exporting countries concerned, producers in the United States of America,
which was initially envisaged as analogue country and producers in other potential analogue
the Commission contacted all other Community operators potentially
countries.
involved in the production and/or distribution of
the like product/product concerned whose
contact details were provided to the Commission following the initiation of the proceeding. The
interested parties were given 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. All
interested parties who so
requested and showed that there were particular reasons why they should be heard, were granted
a hearing.

(1) 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).

(2) OJ C 29, 4.2.2006, p. 2.

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(4)

(5)

In view of the high number of Chinese exporting producers, sampling was envisaged in the notice of
initiation for the determination of dumping, in accordance with Article 17 of the basic Regulation. In
order to enable the Commission to decide whether sampling would be necessary and, if so, to select a
sample, all Chinese exporting producers were asked to make themselves known to the Commission
and to provide, as specified in the notice of initiation, basic information on their activities related to
the product concerned during the period 1 January 2005 to 31 December 2005. However, only eight
Chinese exporting producers came forward and provided the requested information for sampling
within the deadlines set out in the notice of initiation. Therefore, it was decided that sampling was
not necessary.

In order to allow exporting producers in the countries concerned to submit a claim for market
economy treatment (MET) or individual treatment (IT), if they so wished, the Commission sent claim
forms to the exporting producers known to be concerned and to the authorities of the PRC and
Ukraine. Eight companies in the PRC and one company in Ukraine requested MET pursuant to Article
2(7) of the basic Regulation or IT should the investigation establish that they did not meet the
conditions for MET.

(6)

The Commission sent questionnaires to all parties known to be concerned and to all other parties
that requested so within the deadlines set out in the notice of initiation.

(7)

(8)

(9)

Questionnaire replies were received from six Chinese exporting producers, from the sole Ukrainian
exporting producer,
from two importers not related to the
exporting producers and from one trader. In addition, one importer submitted comments without
replying to the questionnaire.

from four Community producers,

Certain information was also received from 17 Community producers of the like product (15 of
which supported the complaint, one expressed a neutral position and one opposed) and three
companies only importing the product concerned.

The Commission sought and verified all the information it deemed necessary for the purpose of MET
and for a provisional determination of dumping, resulting injury and Community interest. Verifi-
cation visits were carried out as follows:

(a) Community producers

Verification visits were carried out at the premises of the four Community producers. These
producers requested that their identities be kept confidential on the basis of the provisions of
Article 19 of the basic Regulation. They claimed that the disclosure of their identity could lead to
a risk of significant adverse effects.

Indeed, certain complainant Community producers supply customers in the Community that also
source their products from the PRC and Ukraine, thus benefiting directly from these imports.
Those complainants argued that they were therefore in a particularly sensitive position since they
had good reasons to believe that some of their suppliers and customers would not be satisfied
with their lodging or supporting a complaint against alleged injurious dumping and would react
to such action. Indeed, they alleged that they risk retaliation from these suppliers and customers,
including the possible termination of their business relationship. The request was granted as it
was sufficiently substantiated.

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(b) Exporting producers in the PRC

— Foshan City Gaoming Lihe Daily Necessities Co. Ltd, Foshan,

— Foshan Shunde Heng Yip Housewares Co. Ltd, Foshan,

— Guangzhou Power Team Houseware Co. Ltd, Guangzhou,

— Since Hardware (Guangzhou) Co. Ltd, Guangzhou,

— Foshan Shunde Yongjian Housewares and Hardware Co. Ltd, Foshan and its related company

Wire King International Ltd, Hong Kong,

— Zhejiang Harmonic Hardware Products Co. Ltd, Guzhou.

(c) Exporting producer in Ukraine

— Eurogold Industries Ltd, Zhitomir and its related company Eurogold Service Zumbühl & Co.,

Zug in Switzerland.

(10)

In the light of the need to establish a normal value for the exporting producers in the PRC and
Ukraine to which MET might not be granted, a verification to establish normal value on the basis of
data from an analogue country took place at the premises of the following company:

— Gİpaş elektronik sanayi

ithalat ihracaat dahili ticaret ve pazarlama anonim şirketi sanayi A.Ş.,

Istanbul, Turkey.

1.3. Investigation period

(11)

The investigation of dumping and injury covered the period from 1 January 2005 to 31 December
2005 (the investigation period or IP). The examination of trends relevant for the assessment of injury
covered the period from 1 January 2002 to the end of the IP (the period considered).

2. PRODUCT CONCERNED AND LIKE PRODUCT

2.1. Product concerned

(12)

The product concerned is ironing boards, whether or not free-standing, with or without a steam
soaking and/or heating top and/or blowing top, including sleeve boards, and essential parts thereof,
i.e. the legs, the top and the iron rest originating in the People's Republic of China and Ukraine (the
ex 4421 90 98,
product
ex 7323 93 90, ex 7323 99 91, ex 7323 99 99, ex 8516 79 70 and ex 8516 90 00.

concerned), normally declared within CN codes

ex 3924 90 90,

(13)

There are different types of ironing boards and their essential parts depending mainly on their
construction and size, their construction material and accessories. However, all different types have
the same basic physical characteristics and uses. Consequently, all existing types are considered as one
product for the purposes of this investigation.

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2.2. Like product

(14)

The product concerned and the ironing boards and the essential parts thereof produced and sold on
the domestic market of the PRC and Ukraine, and on the domestic market of Turkey, which finally
served as an analogue country, as well as the ironing boards and their essential parts produced and
sold in the Community by the Community industry were found to have the same basic physical and
technical characteristics and uses. Therefore, these products are provisionally considered to be alike
within the meaning of Article 1(4) of the basic Regulation.

3.1. Market economy treatment (MET)

3. DUMPING

(15)

Pursuant to Article 2(7)(b) of the basic Regulation, in anti-dumping investigations concerning imports
originating in the PRC and in Ukraine (in the latter case for all proceedings lodged or initiated before
30 December 2005), normal value shall be determined in accordance with paragraphs 1 to 6 of the
said Article for those exporting producers which have shown that they meet the criteria laid down in
Article 2(7)(c) of the basic Regulation, i.e. where it is demonstrated by such exporting producers that
market economy conditions prevail in respect of the manufacture and sale of the like product. Briefly,
and for ease of reference only, these criteria are set out in a summarised form below:

— business decisions and costs are made in response to market conditions, and without significant

State interference,

— accounting records are independently audited, in line with International Accounting Standards

(IAS) and applied for all purposes,

— there are no significant distortions carried over from the former non-market economy system,

— legal certainty and stability is provided by bankruptcy and property laws,

— currency exchanges are carried out at the market rate.

(16)

Eight Chinese exporting producers initially requested MET pursuant to Article 2(7)(b) of the basic
Regulation and replied to the MET claim form for exporting producers within the given deadlines.
However, two of them decided subsequently not to co-operate with the investigation. Thus, only the
MET claims of the remaining six co-operating Chinese exporting producers listed in recital 9 were
considered.

(17)

The sole Ukrainian exporting producer requested MET pursuant to Article 2(7)(b) of the basic
Regulation and replied to the MET claim form for exporting producers within the given deadlines.

(18) However,

the Ukrainian producer remarked that Ukraine was by Council Regulation (EC) No
2117/2005 removed from the list of non-market-economy countries mentioned under Article
2(7)(b) of the basic Regulation. The company claimed that the decision to grant market economy
status to Ukraine was taken on the basis of an assessment of the situation in the preceding months.
Therefore, it was submitted that it should be granted MET because (i) the IP is the calendar year
2005; (ii) the complainants should have provided evidence showing that market economy conditions
were not applicable to the Ukrainian producers concerned and (iii) a failure to grant MET status to
Ukraine would discriminate Ukraine with regard to Russia.

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(19)

In this respect, it is noted that Council Regulation (EC) No 2117/2005 clearly states that normal
value for Ukrainian exporters and producers will be established in accordance with the provisions of
Article 2(1) to (6) of the basic Regulation only in investigations initiated after 30 December 2005,
either on the basis of an application for initiation lodged after the above said date or at the initiative
of the Commission. As the complaint for this proceeding was lodged on 23 December 2005, it is
evident that the provisions of Article 2(1) to (6) of the basic Regulation cannot apply and that the co-
operating Ukrainian company has, therefore, to prove that it meets the criteria laid down in Article
2(7)(c) of the basic Regulation. It is evident from the wording of the aforesaid Article that it is the
exporting producers that carry the burden of proof on the fulfilment of the MET criteria and not the
complainants. Furthermore, it should be noted that the granting of MET status to a certain country is
based on an overall assessment of its economic situation as a whole with a view to establish whether
costs and prices can, in general, be relied on for the purpose of anti-dumping investigations. In other
words, it is not an evaluation of the particular situation of each individual enterprise. Finally, the
argument that Ukraine would be discriminated with regard to Russia is without foundation as Russia
has been considered to be a market economy since 2002. For these reasons the Commission rejected
the claims made by the Ukrainian exporting producer and proceeded with the MET determination
process.

(20)

For the co-operating exporting producers the Commission sought all information deemed necessary
and verified the information submitted in the MET claim at the premises of the companies in
question.

3.1.1. MET determination regarding exporting producers in the PRC

(21) One Chinese exporting producer, Since Hardware (Guangzhou) Co., Ltd, Guangzhou, showed that it
fulfilled all five criteria set out in Article 2(7)(c) of the basic Regulation and it was granted MET.

(22) As far as the remaining Chinese exporting producers listed in recital 9 are concerned, one did not
fulfil criteria 1, 2 and 3, one did not fulfil criteria 2 and 3 and three did not meet criterion 2.

(23) All co-operating Chinese exporting producers and the Community industry were given an oppor-
tunity to comment on the above findings. Four companies disagreed with the determinations made
and claimed that they should be granted MET.

(24) As far as criterion 1 is concerned, one Chinese exporting producer has not demonstrated that it fulfils
this criterion. In particular, it has not shown at any stage of the investigation that one of its two
shareholders actually paid for its shares obtained from the state. Furthermore, the company obtained
electricity from the state on a non-contractual basis. The company contested the disclosed findings
but did not provide any verifiable evidence on these issues. Therefore, its comments could not be
taken into account. Consequently, it was concluded that the company has not shown that it fulfils
criterion 1.

(25) As far as criterion 2 is concerned, five companies failed to demonstrate that they had a clear set of
accounting records,
independently audited in line with International Accounting Standards. As a
matter of fact, an examination of the accounts in question showed significant flaws in all five
cases. For instance, the companies did not itemise all different revenues and expenses in their
accounts but applied an extensive offsetting system between such revenues and expenses on a
monthly basis. They also did not respect the accrual principle of accounting. In fact, they grouped
transactions per month and recorded them in their books on a summary basis without details of the
individual transactions concerned. Since the auditors have not commented on these infringements of
the IAS 1, the accounting records were not audited in line with IAS. Upon disclosure, four exporting
producers continued to argue that they followed IAS but provided no evidence to show that the
findings were wrong. Consequently, it was concluded that in all cases the companies have not shown
that they fulfil criterion 2.

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(26)

Two companies also failed to demonstrate that they fulfil criterion 3. For these two companies it was
found on the spot that they had not met their contractual obligations in respect to payments of land-
use rights to the state, yet
this had no financial or other consequence for the companies.
Furthermore, one company was found to lease during the IP state owned land for which it had
not formally obtained land-use rights from the state. This situation was only corrected after the IP,
but only at a fee below the normal rate. Upon disclosure the two Chinese exporting producers
contested these findings, but the new information they submitted in order to support their claims
could not be accepted since it was not verifiable. Consequently,
it was concluded that both
companies failed to show that they fulfil criterion 3.

(27) On the basis of

the above, only one Chinese exporting producer, namely Since Hardware
(Guangzhou) Co. Ltd, has shown that it fulfils all the criteria set out in Article 2(7)(c) of the basic
Regulation and was granted MET, whilst the remaining five exporting producers have not shown that
they fulfil all such criteria and, thus, could not be granted MET.

3.1.2. MET determination regarding the sole exporting producer in Ukraine

(28)

The sole Ukrainian exporting producer, Eurogold Industries Ltd, Zhitomir, showed that it fulfils all
the criteria set out in Article 2(7)(c) of the basic Regulation and was therefore granted MET. The
exporting producer and the Community industry were given an opportunity to comment on the MET
findings but no comments were received.

3.2. Individual treatment (IT)

(29)

Pursuant to Article 2(7)(a) of the basic Regulation, a country wide duty, if any, is established for
countries falling under that Article, except in those cases where companies are able to demonstrate
that they meet all criteria set out in Article 9(5) of the basic Regulation.

(30) As far as the PRC is concerned, all exporting producers who requested MET also claimed IT in the

event that they would not be granted MET.

(31) On the basis of the information available, it was found that four companies met all the requirements

for IT as set forth in Article 9(5) of the basic Regulation.

(32)

It was therefore concluded that IT should be granted to the following exporting producers in the
PRC:

— Foshan City Gaoming Lihe Daily Necessities Co. Ltd, Foshan,

— Guangzhou Power Team Houseware Co. Ltd, Guangzhou,

— Foshan Shunde Yongjian Housewares and Hardware Co. Ltd, Foshan,

— Zhejiang Harmonic Hardware Products Co. Ltd, Guzhou.

(33) On the basis of the information available, it was found that one company failed to demonstrate that
it cumulatively met all the requirements for IT as set forth in Article 9(5) of the basic Regulation.

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(34)

In particular, it was established that information referring to export sales made either directly or via a
related company established in Hong Kong was not verifiable. The company failed to provide
substantial data referring to its total export volumes and the relevant corresponding export
invoices despite requests for such information. Furthermore, the information submitted on total
turnover, as well as domestic and export sales could not be reconciled with the available audit
reports and the company's accounting records. In addition, the company was not able to demonstrate
the destination of its sales as reported in the questionnaire. The Commission could thus not verify if
the company was able to freely determine its export prices and quantities, and conditions and terms
of sale as set out in Article 9(5)(b) of the basic Regulation.

3.3. Normal value

3.3.1. Analogue country

(35) According to Article 2(7) of the basic Regulation,

in case of imports from non-market-economy
countries and to the extent that MET could not be granted, for countries specified in Article 2(7)(b) of
the basic Regulation, normal value has to be established on the basis of the price or constructed value
in an analogue country.

(36)

In the notice of initiation the Commission indicated its intention to use the United States of America
(USA) as an appropriate analogue country for the purpose of establishing normal value for the PRC
and Ukraine and invited the interested parties to comment thereon.

(37)

(38)

(39)

Comments were received from the co-operating exporting producers in the PRC and Ukraine
suggesting Thailand, India or Turkey as being more suitable analogue countries than the USA. The
main arguments made against the USA were the differences in overall economic development, access
to and prices of raw materials, labour cost and production methods, but also differences in terms of
competition on domestic market for ironing boards. It was also claimed that the USA market for
ironing boards is a highly protected market with artificially high prices.

The Commission sought co-operation from producers in the USA and in other potential analogue
countries such as Thailand, India and Turkey. Letters and relevant questionnaires were sent to five
companies in the USA, three companies in Thailand, five companies in India and nine companies in
Turkey. Out of all these companies, only one Turkish producer submitted in due time all the
necessary information for the determination of normal value and agreed to co-operate in the
investigation.

The investigation showed that Turkey has a competitive market for ironing boards with around 90 %
of the market supplied by a number of local producers and the rest by imports from third countries.
The production volume in Turkey constitutes more than 5 % of the volume of Chinese exports of the
product concerned to the Community. As for the quality and standards of the Turkish ironing
boards, no major overall differences were found when compared to Chinese and Ukrainian
products. The Turkish market was therefore deemed sufficiently representative for the determination
of normal value for the PRC and Ukraine.

(40)

In view of the above, it is provisionally concluded that Turkey constitutes an appropriate analogue
country in accordance with Article 2(7)(a) of the basic Regulation.

3.3.2. Determination of normal value for the exporting producers granted MET

(41)

The normal value determination for one Chinese and the sole Ukrainian exporting producer granted
MET should be based on the data they submitted on domestic sales and cost of production. These
data were verified at the premises of the companies concerned.

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(42) As far as the determination of normal value is concerned, the Commission first established in each
exporting country whether the domestic sales of the product concerned by each exporting producer
were representative in comparison with total sales to the Community. In accordance with Article 2(2)
of the basic Regulation, domestic sales were considered representative when the total domestic sales
volume of each exporting producer was equal to or greater than 5 % of the total export sales volume
of the producer to the Community.

3.3.2.1. P e o p l e ' s R e p u b l i c o f C h i n a

(43)

It was established that the Chinese exporting producer granted MET did not have sufficient repre-
sentative domestic sales during the IP. Therefore, normal value could not be established on the basis
of prices of the relevant exporting producer in the export country, as provided by Article 2(1)
subparagraph 1 of the basic Regulation. Subsequently, another method had to be applied.

(44) Given that no domestic prices could be used to establish normal value, a constructed normal value
had to be calculated based on the costs of the producer in question. Consequently, in accordance
with Article 2(3) of the basic Regulation, therefore, normal value was constructed by adding to the
manufacturing costs of the exported ironing board types, adjusted where necessary, a reasonable
amount for selling, general and administrative (SG&A) expenses and a reasonable margin of profit. In
this respect it should be noted that the purchase prices of certain raw materials/parts, in particular
raw materials/parts made of steel, reported by this company appears to be artificially low and thus
the cost of production needs to be further examined and the provisional findings may have to be
reconsidered for the purpose of any definitive findings.

(45)

Since the exporting producer that was granted MET had insufficient representative domestic sales,
SG&A expenses and profit had to be determined on the basis of any other reasonable method
pursuant to Article 2(6)(c) of the basic Regulation.

(46)

Consequently, the Commission used the SG&A expenses and profit rates from the co-operating
exporting producer in the analogue country which had domestic sales in the ordinary course of
trade. The SG&A expenses and profit average rates found in the co-operating Turkish exporting
producer were added to the cost of manufacturing incurred by the exporting producer in question
with regard to the exported types as stipulated by Article 2(3) of the basic Regulation.

(47)

(48)

(49)

3.3.2.2. U k r a i n e

It was established that for the sole Ukrainian exporting producer the overall domestic sales of the
product concerned during the IP were not made in representative quantities. Therefore, normal value
could not be established on the basis of prices of the relevant exporting producer in the export
country, as provided by Article 2(1) subparagraph 1 of the basic Regulation. Subsequently, another
method had to be applied.

Since the exporting producer with MET did not have sufficient domestic sales and since there was no
other co-operating Ukrainian exporting producer,
the SG&A expenses and profit had to be
determined on the basis of any other reasonable method pursuant to Article 2(6)(c) of the basic
Regulation.

Consequently, the Commission used SG&A expenses and profit rates from the co-operating exporting
producer in the analogue country which had domestic sales in the ordinary course of trade. The
SG&A expenses and profit average rates found in the co-operating Turkish exporting producer were
compounded on the cost of manufacturing incurred by the exporting producer in question with
regard to the exported types as stipulated by Article 2(3) of the basic Regulation.

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3.3.3. Determination of normal value in the analogue country

(50)

Following the choice of Turkey as an analogue country, normal value was calculated on the basis of
the data verified at the premises of the co-operating Turkish producer.

(51)

The domestic sales of the Turkish producer of the like product were found to be representative
compared to the product concerned exported to the Community by the exporting producers in the
PRC.

(52) An examination was also made as to whether the domestic sales could be regarded as having been
made in the ordinary course of trade, by establishing the proportion of profitable sales to inde-
pendent customers. The verification carried out at the Turkish producer showed that its sales volume,
sold at a net sales price equal to or above the unit cost, represented more than 80 % of the total sales
volume. Therefore, normal value was based on the actual domestic price, calculated as a weighted
average of the prices of all domestic sales of that product type made during the IP, irrespective of
whether these sales were profitable or not. In addition, these domestic prices were found to be overall
in line with the prices of another major Turkish producer for which certain information was obtained
during on the spot verification in the analogue country.

3.4. Export price

3.4.1. People's Republic of China

(53)

The exporting producers made export sales to the Community either (i) directly to independent
customers
located outside the
Community and (iii) through related trading companies located outside the Community.

through unrelated trading companies

in the Community;

(ii)

(54) Where export sales to the Community were made directly to independent customers in the
Community, the export prices were established on the basis of the prices actually paid or payable
for the product concerned in accordance with Article 2(8) of the basic Regulation.

Where export sales to the Community were made through unrelated trading companies, export prices
were established on the basis of the prices of the product when sold to the trading companies for
export to the Community in accordance with Article 2(8) of the basic Regulation.

(55) Where export sales to the Community were made through related trading companies, the export
price was established on the basis of the prices of the product when sold by the related trading
companies to the first independent buyer in accordance with Article 2(8) of the basic Regulation.

(56) One exporting producer was selling part of the product concerned via a trading company in Hong
Kong. The Hong Kong based trading company was not in a position to properly demonstrate
through its accounts that the reported export prices to independent customers in the Community
were actually paid. Furthermore, it was not possible to reconcile on the spot the Hong Kong trader's
purchases with its audited accounts for sales to the Community. The company was informed that
there were serious doubts about the accuracy of its sales to the Community via the related trading
company in Hong Kong and that such sales would be disregarded for the provisional dumping
calculations. The company was given the opportunity to comment, but it did not provide any
evidence which could change the preliminary conclusion. Thus, those export transactions were
disregarded and the export price was based only on prices for sales made either directly to inde-
pendent customers in the Community or through unrelated trading companies located outside the
PRC and the Community.

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(57) One exporting producer had no direct sales of the product concerned. It sold the product concerned
either via unrelated trading companies located in the PRC or via a related trading company located in
the PRC. Since the final destination of the sales made via unrelated parties could not be demon-
strated, these sales were provisionally disregarded and the export price was based only on the sales
made via the related trading company, which was able to demonstrate the destination of its sales. The
company was informed accordingly and given the opportunity to comment. The comments have not
altered this preliminary conclusion.

(58) As it has been explained under the analysis of IT in recital (33) above, one exporting producer was
not able to demonstrate and substantiate its actual export sales. Therefore, pursuant to Article 18(1)
of the basic Regulation all its export sales were disregarded and prices reported could not be used for
the establishment of export prices from the PRC to the Community. The company was informed
accordingly and given the opportunity to comment. Nevertheless, the comments have not changed
the findings of the investigation and, since no other source was available to establish this company's
exports to the Community, it was considered appropriate to disregard all its export data and establish
the dumping margin on the facts available (see recital (65)).

3.4.2. Ukraine

(59) All export sales to the Community of the sole Ukrainian exporter were made through its related
company located outside the Community. This related company performed all import functions of
the goods entering into free circulation in the Community, and should consequently be considered as
a related importer. The export price was therefore established in accordance with Article 2(9) of the
basic Regulation, on the basis of prices at which the imported products were first resold to an
independent buyer. For this purpose, adjustments were made to take account of all costs, including
any duties and taxes, incurred between importation and resale, and of profits normally accruing by
independent co-operating importers, so that a reliable export price could be established.

3.5. Comparison

(60)

The comparison between normal value and export price was made on an ex-factory basis.

(61)

For the purpose of ensuring a fair comparison between the normal value and the export price, due
allowance in the form of adjustments was made for differences affecting prices and price compar-
investigated exporting
ability in accordance with Article 2(10) of the basic Regulation. For all
producers, allowances for differences in transport and insurance costs, handling,
loading and
ancillary costs, packing costs, credit costs, warranty and guarantee costs and commissions have
been granted where applicable and justified.

(62) As regards the normal value based on the analogue country for exporting producers not granted
MET, the investigation established that the Turkish ironing boards are in most cases equipped with
electric socket and cord-minder, whereas this was not the case for the majority of Chinese products.
Therefore, an appropriate adjustment was made under Article 2(10)(a) of the basic Regulation for the
Turkish prices to eliminate the effect of this difference. In addition, some differences in the level of
trade were found. It was established that on the Turkish domestic market ironing boards are normally
supplied directly to retailers and thus the quantities per order/delivery are substantially lower
compared to those made via importers/traders or via distribution/supply centres of the large retail
chains, as it is the case of Chinese export sales. Therefore, an appropriate adjustment was made under
Article 2(10)(d) of the basic Regulation on the Turkish prices to eliminate the effect of these
differences.

3.6. Dumping margins

3.6.1. General methodology

(63)

Pursuant to Article 2(11) and (12) of the basic Regulation, dumping margins for co-operating
exporting producers were established on the basis of a comparison of a weighted average normal
value by product type with a weighted average export price by product type as established above. It is
noted that there were no co-operating exporting producers in both countries beyond those granted
MET or IT.

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(64)

In order to determine the dumping margin for all non-cooperating exporting producers, the level of
non-cooperation was first established. To this end, the volume of exports to the Community reported
by the co-operating exporting producers was compared with the equivalent volume of imports
established on the basis of the complaint and of certain information collected from other known
exporting producers in the countries concerned who did not finally co-operate in the investigation. It
should be noted that there are no precise Eurostat import statistics for the product concerned.

(65) Where the level of co-operation is low, i.e. less than 80 % of total exports of the product concerned
being accounted for by the co-operating exporting producers, it is considered appropriate to set the
dumping margin for other exporting producers at a level higher than the highest dumping margin
established for the co-operating exporting producers. In such case, the dumping margin was therefore
established at a level which corresponds to the weighted average dumping margin of the most sold
product types of the co-operating exporting producers with the highest dumping margins. This was
considered appropriate since there was reason to believe that the low level of co-operation results
from the non-cooperating exporting producers in the investigated country generally having dumped
at a higher level than any co-operating exporting producer. Moreover, since there were no indications
that any non-cooperating company was dumping at a lower level.

(66) Where the level of co-operation is high, i.e. 80 % or more of total exports of the product concerned
being accounted for by the co-operating exporting producers, it was considered appropriate to set the
dumping margin for the other exporting producers at the level of the highest dumping margin
established for a co-operating exporting producer in the country concerned.

3.6.2. Dumping margins

3.6.2.1. P e o p l e ' s R e p u b l i c o f C h i n a

(67)

Based on the complaint and the information available from the exporting producers which came
forward and provided certain data at the initial stage of the investigation it was provisionally
concluded that the level of co-operation was below 80 %. Therefore the methodology described in
recital (65) above was used to establish the country wide dumping margin.

(68)

The provisional dumping margins, expressed as a percentage of the cif Community frontier price duty
unpaid, are the following:

— Foshan City Gaoming Lihe Daily Necessities Co. Ltd, Foshan: 34,9 %

— Guangzhou Power Team Houseware Co. Ltd, Guangzhou: 36,5 %

— Since Hardware (Guangzhou) Co. Ltd, Guangzhou: 0 %

— Foshan Shunde Yongjian Housewares and Hardware Co. Ltd, Foshan: 18,1 %

— Zhejiang Harmonic Hardware Products Co. Ltd, Guzhou: 26,5 %

— all other companies: 38,1 %.

(69)

For the only Chinese exporting producer granted MET, namely Since Hardware (Guangzhou) Co. Ltd,
it was provisionally established that the export sales were not made at dumping prices. In this
respect,
it should be recalled that the provisional findings may have to be reconsidered for the
purpose of any definitive findings for the reasons explained under recital (44).

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3.6.2.2. U k r a i n e

(70)

Based on the complaint and the information available from the exporting producers which came
forward and provided certain data in the initial stage of the investigation it was provisionally
it
concluded that
appears that Eurogold Industries Ltd is the sole Ukrainian exporting producer of ironing boards
and no indications were found that any exporting producer deliberately abstained from cooperating.
Therefore, the methodology described in recital (66) above was used to establish the dumping margin
for any other Ukrainian exporting producers of the product concerned.

the level of co-operation was above 80 % in the case of Ukraine.

In fact,

(71)

The provisional dumping margin, expressed as a percentage of the cif Community frontier price duty
unpaid, are the following:

— Eurogold Industries Ltd, Zhitomir: 17,3 %

— all other companies: 17,3 %.

4.1. Community production

4. INJURY

(72)

The provisional findings of the investigation established that the like product is manufactured by at
least 30 small and medium sized companies (SMEs) in the Community. Most of the Community
production is located in Italy, Poland and the United Kingdom.

(73) Although there are several producers on the Community market, the level of concentration is
relatively high as can be seen by the fact that the output of the five major producers represents
more than 50 % of the overall estimated output in the Community. The output of all the above
companies constitutes the total Community production.

4.2. Definition of the Community industry

(74)

The complaint was lodged by three Community producers representing a major proportion of the
total known Community production of the like product, i.e. in this case more than 40 %.

(75)

(9)). These four companies represent more than 45 % of

The complainants and one other Community producer fully co-operated in the investigation (see also
recital
the total known Community
production of the like product. One of these Community producers had made some imports from
the PRC in the IP. However, importation was not its core business and these imports were considered
to have been made in reaction to the influx of low-priced dumped imports, in particular in order to
remain competitive in its low-end product range. It is thus not considered appropriate to exclude this
producer from the definition of the Community industry.

(76) On this basis it is considered that the four Community producers referred to in recital (75) above are
deemed to constitute the Community industry within the meaning of Article 4(1) and Article 5(4) of
the basic Regulation. They will hereinafter be referred to as the ‘Community industry’.

4.3. Community consumption

(77)

is recalled that

there are no precise Eurostat

It
import statistics for the product concerned.
Furthermore, there is no indication of any significant quantity of imports of ironing boards from
countries other than the PRC and Ukraine (countries concerned). The Community consumption was
thus established on the basis of the following information:

— the volume of sales in the Community of the like product produced by the Community industry,

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— the volume of sales in the Community of the like product produced by other known Community

producers,

— the volume of imports of the product concerned in the Community from the co-operating

Chinese and Ukrainian exporting producers,

— the volume of imports of the product concerned in the Community from other known Chinese

exporting producers.

On this basis, the Community consumption developed as follows:

2002

2003

2004

IP

Consumption (units)

6 684 000

6 795 000

7 187 000

8 557 000

Index: 2002 = 100

100

102

108

128

Source: questionnaire replies from the Community industry and co-operating Chinese and Ukrainian exporting producers, infor-
mation collected from other Community producers and other Chinese exporting producers.

(78)

The consumption of ironing boards in the Community increased by 28 % between 2002 and the IP,
with the most sudden increase between 2004 and the IP. The overall steady increase is mainly
attributed to the increasing consumption in the new Member States, though the increase in the IP
can to some extent be attributed to increased low priced imports from the PRC and Ukraine by some
formerly traditional Community producers who switched to importing and, thus,
increased their
stocks.

4.4. Imports from the countries concerned

4.4.1. Cumulative assessment of the effects of the dumped imports concerned

(79)

The Commission considered whether the effects of dumped imports from the countries concerned
should be assessed cumulatively, on the basis of the criteria set out in Article 3(4) of the basic
Regulation. This Article provides that the effects of imports from two or more countries simulta-
neously subject to anti-dumping investigations shall be assessed cumulatively only if it is determined
that (a) the margin of dumping established in relation to the imports from each country is more than
de minimis as defined in Article 9(3) of the basic Regulation and that the volume of imports of each
country is not negligible and (b) a cumulative assessment of the effects of the imports is appropriate
in the light of the conditions of competition between imported products and the conditions of
competition between the imported products and the like Community product.

(80)

It is recalled that imports from one Chinese exporting producer were not found to be dumped.
Therefore, these imports have not been considered with the dumped imports.

(81)

The dumping margins established in relation to dumped imports from each of
the countries
concerned were more than de minimis. In addition, the volume of the dumped imports from each
of those countries was not negligible in the sense of Article 5(7) of the basic Regulation.

(82)

The investigation further showed that the conditions of competition both between the dumped
imports and between the dumped imports and the like Community product were similar. It was
found that, irrespective of their origin, ironing boards produced/sold by the countries concerned and
those produced/sold by the Community industry compete against each other since they are alike in
terms of their basic characteristics, interchangeable from the consumer's point of view and distributed
via the same distribution channels.

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(83)

Certain interested parties claimed that the conditions for cumulative assessment were not fulfilled in
this case because there are fundamental differences between imports from the PRC and Ukraine in
terms of prices and market behaviour.

(84) As regards prices, it is noted that the absolute difference in the level of the prices between the two
countries is not decisive in the context of the cumulative assessment. It may indeed be explained by
various factors, e.g. a different product mix. It is the price trend over the period considered that is
relevant and the trend is comparable for the two countries. In fact, the average import price from the
PRC and Ukraine increased by 27 % and 12 % respectively between 2002 (2003 in the case of
Ukraine) and the IP.

(85) As far as the market behaviour is concerned, as already stated in recital (82) above, no substantial

differences in terms of product characteristics, distribution channels etc. were established.

(86) On this basis,

it is provisionally concluded that all conditions of cumulation are met and that
accordingly the effects of the dumped imports originating in the countries concerned should be
assessed jointly for the purpose of the injury analysis.

4.4.2. Volume, price and market share of dumped imports from the countries concerned:

2002

2003

2004

IP

Imports (units)

431 000

858 300

2 388 600

4 120 800

Index: 2002 = 100

100

199

554

956

Source: questionnaire replies from co-operating Chinese and Ukrainian exporting producers,
Chinese exporting producers.

information collected from other

(87)

The volume of imports of the product concerned increased significantly throughout the period
considered. Imports in the IP increased more than 850 % since 2002.

(88)

It should be noted that there were no imports from Ukraine in 2002. The only Ukrainian producer
of ironing boards started its operation in 2003. The imports from Ukraine increased sharply in 2004,
by more than 400 %.

Average import price (EUR/unit)

Index: 2002 = 100

2002

4,91

100

2003

6,15

125

2004

6,34

129

IP

6,53

133

Source: questionnaire replies from co-operating Chinese and Ukrainian exporting producers.

(89)

The average import price increased throughout the period considered. However, it remained signifi-
cantly below the average prices of the Community industry (see relevant table and recital (99)). In the
IP, the average import price was by more than 40 % lower than the average price of the Community
industry.

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(90)

The increase of average import prices can be attributed to the following factors.

There was a significant move by the PRC exporters towards the mid to high end of the market. In
fact, as already mentioned in recital (78) above, some traditional Community producers significantly
lowered or discontinued their production in the Community and started to import from the countries
concerned. Most of these companies are established in mid and high range products.

Most of the Chinese exporting producers are recent entrants to the ironing board market and it is not
surprising to observe some increase in prices as they become more established.

The share of imports from Ukraine suddenly increased in 2004. Since the average price level of these
imports is above the average price level of imports from the PRC, the cumulated price level is higher.

Market share

Index: 2002 = 100

2002

6 %

100

2003

13 %

196

2004

33 %

515

IP

48 %

747

Source: questionnaire replies from co-operating Chinese and Ukrainian exporting producers,
Chinese exporting producers.

information collected from other

(91)

share of dumped imports

The market
from the countries concerned increased dramatically
throughout the period considered. It almost tripled between 2003 and 2004, when the imports
from Ukraine massively penetrated the Community market, and continued increasing at a high rate in
the IP to an extent that they took almost half of the market.

4.4.3. Undercutting

(92)

For the purpose of analysing price undercutting, the import prices of the co-operating exporting
producers were compared to the Community industry prices, on the basis of weighted averages for
comparable product types during the IP. The Community industry prices were adjusted to an ex-
works level, and compared to cif Community frontier import prices, plus customs duties where
trade, duly
applicable. This price comparison was made for transactions at
adjusted where necessary, and after deduction of rebates and discounts.

the same level of

(93) On the basis of the co-operating exporting producers' prices, the undercutting margins found, by
country, and expressed as a percentage of the Community industry's prices, are as follows:

Country

PRC

Ukraine

Price Undercutting

30,8 %-45,5 %

6,6 %

4.5. Situation of the Community industry

4.5.1. Preliminary remarks

(94)

Pursuant to Article 3(5) of the basic Regulation, the Commission examined all economic factors and
indices having a bearing on the state of the Community industry. Full analysis of these factors was
carried out for the complainants and one other fully co-operating producer,
i.e. the Community
industry.

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4.5.2. Injury indicators

Production, capacity and capacity utilisation:

2002

2003

2004

IP

Production (units)

2 851 796

2 814 254

2 578 175

2 229 641

Index: 2002 = 100

100

99

90

78

Capacity (units)

5 304 158

5 304 158

5 304 158

5 484 620

Index: 2002 = 100

Capacity utilisation

Index: 2002 = 100

Source: verified questionnaire replies.

100

54 %

100

100

53 %

99

100

49 %

90

103

41 %

76

(95) During the period considered, the Community industry's production decreased by 22 %. The slight
increase in capacity in the IP was because one Community producer installed extra capacity to benefit
from the increased consumption following the enlargement of the EU. Unfortunately, only imports
benefited from this increase in consumption. As a result, the capacity utilisation decreased more than
the output in the IP.

Stocks:

Stocks (units)

Index: 2002 = 100

Source: verified questionnaire replies.

2002

96 729

100

2003

2004

IP

131 811

180 518

144 543

136

187

149

(96)

There has been an overall increase in stocks between 2002 and the IP. Although the peak in 2004
was in all likelihood in part influenced by completed orders not yet delivered to the customers, the
overall increasing trend is evident.

Sales volume, sales price and market share:

Sales in the EC (units)

2 605 381

2 567 285

2 348 934

2 050 373

2002

2003

2004

IP

Index: 2002 = 100

Market share

Index: 2002 = 100

Sales price (EUR/unit)

Index: 2002 = 100

Source: verified questionnaire replies.

100

39 %

100

12,99

100

99

38 %

97

12,31

95

90

33 %

84

11,17

86

79

24 %

61

11,18

86

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(97)

Sales of the Community industry decreased throughout the period considered and in the IP dropped
at 79 % of their original volume. Such a decreasing trend is even more worrying when seen within
the context of increasing Community consumption. In fact, the Community industry lost 39 % of its
market share between 2002 and the IP.

(98) No growth of the Community industry could be observed. In fact, the Community industry has not
benefited from the growth of the market, i.e. the increased Community consumption, but to the
contrary has lost 21 % of its sales volume in the period considered.

(99) Average unit price of the Community industry's own production decreased significantly in the first
three years, i.e. by 14 %. It reached its lowest level in 2004 and remained stable in the IP.

Profitability:

Pre-tax profit margin

Index: 2002 = 100

Source: verified questionnaire replies.

2002

6,8 %

100

2003

6,4 %

94

2004

0,7 %

10

IP

4,1 %

60

(100) Over the period considered profitability of the Community industry deteriorated. The profit margin in
the IP was 40 % lower than in 2002. The apparent improvement in the IP, as compared to 2004,
was in reality achieved by cuts in remunerations of the management of some companies. Such
remuneration cuts had significant impact on their profit margins. In fact, the overall gross profit
continued decreasing in the IP and reached 65 % of its 2002 level. It is therefore evident that the
increase of overall net pre-tax profit is artificial and not sustainable.

Investment, return on investment, cash flow and the ability to raise capital:

2002

2003

2004

IP

Investment (EUR)

1 437 087

779 490

1 303 287

635 836

Index: 2002 = 100

100

54

91

44

Return on investment

61,98 %

68,19 %

4,77 %

27,02 %

Index: 2002 = 100

100

110

8

44

Cash flow (EUR)

3 463 326

4 184 515

1 246 671

3 023 277

Index: 2002 = 100

100

121

36

87

Source: verified questionnaire replies.

(101)

Investments significantly decreased over the period considered, reaching in the IP less than half of the
level in 2002. Furthermore, major part of the investments constituted necessary replacement and
renovation investments. Part of the 2004 investment was also connected with preparation for new
opportunities after the enlargement of the EU. However, as shown above, the increased consumption
was entirely taken over by imports from the countries concerned.

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(102) The return on investment, expressed in terms of net profits of the Community industry and the net
book value of its investments developed in line with the investment and the profit margins. In respect
of the seemingly high level of return on net assets, it should be noted that most of the companies
constituting the Community industry were established 30 or more years ago and thus most of their
assets have already been considerably depreciated. In fact, in 2004 when certain investments were
made and when profit margins reflected the actual performance of the Community industry (rather
than the artificially increased profit in the IP), the return on investment dropped by 63 percentage
points. This confirms the inability of the Community producers to raise capital, in particular because
of decreasing sales volume and low sales price.

(103) The Community industry's cash flow fluctuated. The 2003 improvement was followed by a sudden
drop in 2004. The recovery in the IP is in line with the measures aimed at profitability improvement,
as described in recital 100 above. Overall, cash flow deteriorated over the period considered.

Employment, productivity and wages:

Employment

Index: 2002 = 100

2002

347

100

2003

326

94

2004

283

82

IP

234

67

Labour cost (EUR)

7 521 183

7 209 158

5 701 507

5 361 572

Index: 2002 = 100

Average labour cost per worker
(EUR)

Index: 2002 = 100

Productivity per worker (units per
year)

100

21 675

100

9 474

96

76

71

22 114

20 147

22 913

102

10 015

93

10 787

106

11 261

Index: 2002 = 100

100

106

114

119

Source: verified questionnaire replies.

(104) The number of employees of the Community industry involved with the like product diminished by
33 % between 2002 and the IP. The average labour cost per employee, reflecting wages, remained
rather stable; temporary decrease in 2004 was compensated by a slight increase in the IP.

(105) Efforts to decrease production cost, rationalisation and reduction in number of employees resulted in
an increased output per worker (19 % increase over the period considered). However, as result from
the above described financial indicators of the Community industry, the increased productivity could
not compensate decrease in volume of sales and price level.

4.5.3. Magnitude of dumping, recovery from past dumping or subsidisation

(106) As concerns the impact on the Community industry of the magnitude of the actual margin of
dumping, given the volume and the prices of dumped imports from the countries concerned, this
impact cannot be considered to be negligible.

(107) Furthermore, there were no indications that the Community industry was recovering, during the IP,

from the effects of any past dumping or subsidisation.

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4.6. Conclusion on injury

(108) During the period considered the presence of low-priced dumped imports from the PRC and Ukraine
increased dramatically. In terms of volume, dumped imports from the countries concerned increased
by more than 850 % during the period considered. In terms of market share, they gained more than
40 percentage points of the Community ironing boards market during the same period.

(109) The analysis of the economic indicators of the Community industry revealed that the injury materi-
alised in terms of decrease of sales volume, sales price and market share. This had a direct negative
impact on the financial situation of the Community industry, the production level and employment.
During the period considered the Community industry's sales volume on the Community market
decreased by more than 20 %, market share declined by 15 percentage points and employment
dropped by more than 30 %. The average sales price of the Community industry decreased by
14 % and the individual prices reached their lowest possible level. In fact, the financial indicators
confirm that the Community industry is no longer in the position to further decrease their price
levels without incurring losses which, in the case of SMEs, cannot be sustained for more than a few
months without being forced to close down.

(110) Taking into account all these factors, it is provisionally considered that the Community industry has

suffered material injury within the meaning of Article 3(5) of the basic Regulation.

5.1. Introduction

5. CAUSATION

(111)

In accordance with Articles 3(6) and (7) of the basic Regulation, the Commission examined whether
the material
injury suffered by the Community industry was caused by dumped imports of the
product concerned originating in the countries concerned. Known factors other than the dumped
imports, which could at the same time have injured the Community industry, were also examined in
order to ensure that possible injury caused by these other factors was not attributed to the dumped
imports.

5.2. Effects of the dumped imports

(112) First, it is recalled that the investigation revealed that the ironing boards imported from the countries
concerned directly compete with the ironing boards produced and sold by the Community industry,
since they are alike in terms of their basic characteristics, interchangeable from the consumer's point
of view and distributed via the same distribution channels.

(113) The significant increase in volume of the dumped imports from the countries concerned (more than
850 %) coincided with the deterioration of the economic situation of the Community industry. This
deterioration included, inter alia, a drop of sales and price levels of the Community production during
the same period.

(114) The market share of the dumped imports increased by 42 percentage points during the period
the

considered, whilst
the Community industry lost 15 % of
Community consumption increased by more than 20 % between 2002 and the IP.

is recalled that

the market.

It

(115) The dumped imports undercut the prices of the Community industry by very substantial margins so
it can be reasonably concluded that they were responsible for the price suppression which led to the
deterioration of the financial situation of the Community industry. In addition, the Community
industry could not increase its capacity utilisation, as could have reasonably happened given the
increase in consumption observed over the period considered.

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(116)

In view of the clearly established coincidence in time between, on the one hand, the surge of dumped
imports at prices significantly undercutting the Community industry's prices and, on the other hand,
the Community industry's loss of sales and production volume, decrease in market shares and
employment, and price depression, it is provisionally concluded that the dumped imports played a
determining role in the injurious situation of the Community industry.

5.3. Effects of other factors

5.3.1. Performance of other Community producers supporting the complaint

(117) Fifteen Community producers of

ironing boards other than those composing the Community
industry supported the complaint. These companies did not wish to fully co-operate in the investi-
gation, however they provided certain information concerning their production, capacity and capacity
utilisation, sales volume, market share and employment. These companies all together represent
around 30 % of the total known Community production. It should be noted that none of these
companies imported any substantial quantity of the product concerned.

(118) The situation of

these 15 companies was analyzed and compared with the situation of

the

Community industry.

Production, capacity, capacity utilisation and employment:

2002

2003

2004

IP

Production (units)

1 401 965

1 674 888

1 448 686

1 262 714

Index: 2002 = 100

100

119

103

90

Capacity (units)

2 758 900

2 865 300

3 284 500

3 299 800

Index: 2002 = 100

Capacity utilisation

Index: 2002 = 100

Employment

Index: 2002 = 100

100

51 %

100

281

100

104

58 %

115

314

112

119

44 %

87

277

98

120

38 %

75

231

82

(119) Production of these producers increased by 19 % in 2003, then decreased to its initial level in 2004
and dropped by 13 % in the IP. The increase in capacity in 2004 can be attributed to the expec-
tations of increased sales following the enlargement of the EU. As a result of increased capacity, the
capacity utilisation decreased more than the output during the period considered. Employment
developed in line with the output, i.e. increased in 2003, then returned to its initial level in 2004
and dropped suddenly in the IP.

Sales volume and market share:

2002

2003

2004

IP

Sales in the EC (units)

1 206 714

1 446 522

1 204 336

1 079 264

Index: 2002 = 100

Market share

Index: 2002 = 100

100

18 %

100

120

21 %

118

100

17 %

93

89

13 %

70

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(120) After a temporary improvement in 2003, the sales and market share of the 15 companies dropped
sharply. This development clearly coincides with the sudden increase of the dumped imports from
the countries concerned on the Community market. It is recalled that these imports almost tripled in
2004 and their market share increased by 20 percentage points in the same year. It is also recalled
that the Community consumption of ironing boards increased throughout the period considered.

(121)

In view of the above, it can be concluded that the situation of these 15 Community producers of
ironing boards, which supported the complaint, deteriorated similarly to the situation of
the
Community industry. Thus, no injury could be caused to the Community industry by these
companies.

5.3.2. Performance of other known Community producers

(122) As set out in recital (8) above, two other Community producers provided certain information but did
not support the complaint. In addition, there are two other known producers in the Community
which supported the complaint, but did not co-operate in the investigation, and one ex-producer
which provided certain information on its past production activities. All these companies made
substantial
imports of the product concerned. The data available for these companies show the
following trends (because of confidentiality reasons actual figures cannot be disclosed):

Sales of Community production
in the EC
Index: 2002 = 100

Market share
Index: 2002 = 100

2002

100

2003

75

2004

49

100

76

46

IP

29

23

(123) Sales of ironing boards produced by these Community producers decreased by 71 % during the
period considered. The corresponding market share has decreased even more significantly by 77 %,
because the market expanded in the same period.

(124) As already mentioned in recital (78) above, in 2004 and during the IP some traditional Community
ironing boards significantly lowered or completely discontinued their production
producers of
activities in the Community and started to import massively from the countries concerned.
In
fact, some of these companies can no longer be considered Community producers, since their
production sites have been closed down in the IP.

(125)

In view of the above, it is concluded that these other Community producers were in a situation
similar to that of the Community industry and their production activities did not cause any injury to
the Community industry.

5.3.3. Export performance of the Community industry:

Exports sales of EC production
(units)

Index: 2002 = 100

Export sales price (EUR/unit)

Index: 2002 = 100

Source: verified questionnaire replies.

2002

2003

2004

IP

213 711

211 887

219 410

215 243

100

14,92

100

99

12,70

85

103

13,26

89

101

13,27

89

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(126) The export performance of the Community industry remained relatively stable during the period
considered. In terms of volumes, no deterioration can be observed. In terms of sales price, a fall by
15 % in 2003 was partially recovered in 2004 and the export price remained stable in the IP. It
should be noted that the export sales price is considerably higher than the sales price in the
Community and that the volume of export sales represents only about 10 % of the output of the
Community industry.

(127)

In this view it can be concluded that the export performance of the Community industry did not
contributed to the material injury suffered.

5.3.4. Imports from the PRC not sold at dumping prices

(128)

It is recalled that imports from one Chinese exporting producer were found not to be sold at
dumping prices and were thus excluded from the analysis of dumped imports from the countries
concerned and their impact on the situation of the Community industry. Therefore, it was considered
whether the imports from this company could have broken the causal link between dumped imports
and the material injury suffered by the Community industry.

(129) The investigation established that during the period considered the volume of imports from the PRC
not sold at dumping prices increased by 467 %, compared to an 856 % increase of dumped imports
from the countries concerned. In absolute terms, the volume of the dumped imports from the
countries concerned exceeded more than five times the volume of the non-dumped imports. The
market share of non-dumped imports from the PRC increased by 343 %, whilst the market share of
dumped imports increased by 647 % during the same period. The average price of non-dumped
imports increased during the period considered and,
it remained considerably
above the average price of dumped imports, although below the Community industry's average price.

in absolute terms,

(130)

In view of the above, it is provisionally concluded that any impact of imports from the PRC not sold
at dumping prices cannot be considered to be such as to break the causal link between dumped
imports and the material injury suffered by the Community industry.

5.3.5. Imports from other third countries

(131) Certain parties argued that imports from Turkey have allegedly been entering the Community market
at prices similar to the PRC and in ever-increasing volumes thereby causing injury to the Community
industry.

(132)

In this regard it is noted that these allegations were not confirmed in the investigation. No evidence
of imports from Turkey was submitted in the course of the investigation. Moreover, the co-operating
Turkish producer of ironing boards referred to in recital (10) above did not sell the like product to
the Community. Furthermore, no other sources of imports were established by the investigation.

(133) Considering the above mentioned findings the claim concerning imports from Turkey is rejected and
injury to the

imports from other third countries did not cause material

it
is concluded that
Community industry.

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5.3.6. The injury is self-inflicted

(134) Certain interested parties argued that the injury was self-inflicted because the Community industry
failed to respond to the changes in the patterns of distribution and consumption and developments
in technology as regards the production of ironing boards. Furthermore, it was claimed that self-
inflicted injury has also been caused by imports of Chinese ironing boards by the Community
producers themselves.

(135)

Ironing boards produced in the Community are normally distributed via traders or, in most instances,
directly supplied to retailers or their distribution centres. Imported ironing boards are normally
distributed via importers/traders or via distribution/supply centres of
large retail chains. The
proportion of the two distribution channels in the case of imports varies from one exporting
producer to another. In all cases agents may be involved. This distribution pattern has been in
place for several years and no significant and sudden changes could be observed over time. The
Community industry has traditionally been supplying both small retailers and large retail chains.
Thus, the increasing share of sales of ironing boards via retail chains cannot be seen as a factor
causing injury per se. No significant changes in the pattern of consumption were confirmed.

(136) As regards the production process/technology, it was argued that the Community industry is not able
to respond to specific requirements from the customers/retailers because of the high level of auto-
mation of their production. Firstly,
it is noted that without automation the Community industry
could not conceivably compete with imports of the products originating in countries benefiting from
very low cost of energy, raw materials and labour. Secondly, the automated production allows the
lead times which is perceived as a
Community industry to guarantee high quality and short
comparative advantage by the customers. Lastly, no evidence was produced to support the claim
that the Community industry was unable to satisfy the specific requirements of customers/retailers
with regard to design and innovation.

(137) As to imports of Chinese ironing boards by the Community industry, the investigation has shown
that only some not significant quantities have been imported in the IP. That was a self defence action
of the Community industry against the influx of low-priced dumped imports. In any event, these
imports were resold in the Community at non-injurious prices. Consequently such imports could not
have caused injury to the Community industry.

(138)

In view of the above, these claims are rejected, and it is concluded that the injury could not be self-
inflicted.

5.4. Conclusion on causation

(139)

In conclusion, it is confirmed that the material injury suffered by the Community industry, which is
characterised especially by a decline in sales volume, market shares and unit sales price resulting in a
deterioration of the financial situation, was caused by the dumped imports from the countries
concerned. Although the imports from the PRC not sold at dumping prices in all
likelihood
contributed to the worsened performance of the Community producers, their development, their
volume and market share and price level was not such as to break the causal
link between the
dumped imports and the injurious situation of the Community industry.

(140) Given the above analysis which has properly distinguished and separated the effects of all the known
factors on the situation of the Community industry from the injurious effects of the dumped imports,
it is hereby confirmed that these other factors as such do not reverse the fact that the injury assessed
must be attributed to the dumped imports.

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(141)

is therefore provisionally concluded that

the dumped imports originating in the countries
It
concerned have caused material injury to the Community industry within the meaning of Article
3(6) of the basic Regulation.

6. COMMUNITY INTEREST

6.1. General remarks

(142) The Commission examined whether, despite the provisional conclusion on the existence of injurious
dumping, compelling reasons existed that could lead to the conclusion that
in the
Community interest to adopt measures in this particular case. For this purpose, and in accordance
with Article 21(1) of the basic Regulation, the impact of possible measures on all parties involved in
this proceeding and also the consequences of not taking measures were considered on the basis of all
evidence submitted.

is not

it

6.2. Interest of the Community industry

(143) The injury analysis has clearly demonstrated that the Community industry has suffered from the
dumped imports. The sharply increased presence of dumped imports in recent years caused a strong
i.e. where competition
suppression of the prices both at wholesale/distribution and retail
between imported and Community manufactured ironing boards takes place. The Community
industry is not in a position to further decrease its sales prices, since this would require that they
sell below their cost of production. Therefore, and given that the market of ironing boards is mainly
it becomes more and more difficult for the
driven by the retail chains on the basis of price,
Community industry to secure new orders.
traditional manufacturers
have already stopped production and are now acting as importers/traders of the product concerned.

is recalled that several

level,

It

(144)

In this context, without the imposition of measures the position of the Community industry would
clearly deteriorate further and the production of ironing boards in the Community would,
in all
likelihood, soon cease. Much of the negative impact on employment would be in one geographical
area of the Community as several producers and their parts suppliers are located in that one region.
On the other hand, measures would prevent a further substantial increase of dumped imports from
the countries concerned, which would allow the Community industry to, at least, maintain its current
position on the market. The investigation has shown that any increase in the market share of the
dumped imports from the countries concerned is gained at the direct expense of the Community
industry.

(145) Following the imposition of anti-dumping duties on imports of ironing boards from the countries
concerned, it can be expected that the distributors and retail chains would be much more likely to
switch their sources of supply, at least partially, to Community producers. Indeed, should measures
be imposed and the level of the import price restored to non-dumped levels, the Community industry
would be able to compete under fair trade circumstances, on the basis of proper comparative
advantage.

(146)

Imposing measures is therefore clearly in the interest of the Community industry and Community
producers actively supporting the complaint, but also in the interest of the other Community
producers that did not actively support the complaint.

6.3. Interest of consumers

(147) No representations were received from consumers' organisations following the publication of the
notice of initiation of this proceeding. Nevertheless, the impact of any measures on the consumers
has been analysed.

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(148)

In order to assess this impact, the following elements were considered:

— importers/wholesalers and/or distributors/retailers are normally involved in the distribution to
in order to cover their costs and to allow
consumers. In each stage a markup, or a margin,
for a certain profit is applied. The level of this margin may vary significantly from one operator
to the other, but is on average substantial, although it would appear that the markup of retailers
is higher than the one of importers. In fact, the average retail price of an ironing board is around
EUR 35, whilst the average unit dumped import price at the Community frontier, i.e. including
the transportation costs, was found to be EUR 6,53 in the IP. Thus, even taking into account any
additional costs at the importers' and retailers' stage, there is a considerable gap between import
prices and retail prices,

— in the most pessimistic scenario, where the burden of anti-dumping measures would be allocated
evenly between the importers, retailers and consumers, i.e. 1/3 for each of them, the consumer
would have to pay in addition less than half a euro for its ironing board, a durable good with a
useful life of at least five years. This has to be compared to a total markup of around 500 % as set
out in the preceding indent,

— it is pertinent to note that the consumer appears not to have benefited from the recent influx of
the low-priced imports since retail prices have not fallen in reaction to these low import prices.
Thus, there is no reason to believe that retail prices would change should anti-dumping measures
be imposed.

(149)

In view of the above, any financial impact of anti-dumping measures on the consumers of ironing
boards would most likely be negligible. On the other hand, should the anti-dumping measures not be
imposed, the Community production would in all likelihood disappear and the choice of product
types available to the consumers may decrease.

(150)

It is therefore provisionally concluded that the imposition of the measures is not likely to be against
the interest of the Community consumers of ironing boards.

6.4. Interest of the distributors/retailers

i.e. hypermarkets, supermarkets. Therefore,

(151) No representations were received from distributors/retailers or their organisations at this stage of the
it is known that nowadays ironing boards are mainly sold by big retail
investigation. However,
it is more than likely that for the majority of
chains,
distributors/retailers the product concerned represents only a negligible part of
their turnover.
Considering this, and taking into account the high mark up they usually apply (see recital (148)
above),
it is provisionally concluded that any measures would probably not have a significant
negative impact on their situation.

6.5. Interest of the unrelated importers in the Community

(152) Questionnaire replies were received from two importers and one trader related to one of these
importers. In addition, four importers provided certain information and/or comments within the
deadlines. These companies all together represent more than 20 % of the total
imports into the
Community. They all objected to the imposition of measures against the PRC, but not all of them
against measures for Ukraine.

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(153) The situation of the importers that made representations varies depending on their size and the
importance of the product concerned in their operations. As already mentioned above, some of these
companies are/were traditional producers but, in a defensive move, they have changed their core
business and are now acting mainly or exclusively as importers. These companies are normally
producing/importing a whole range of other household products and ironing boards represent a
fraction of their business. In the case of one major ex-producer, which became recently an important
importer of Chinese ironing boards, it was provisionally established that ironing boards represented
in the IP less than 4 % of its turnover. Furthermore, this company expressed an opinion only against
measures for the PRC, but not against Ukraine since they did not import from the latter. It was also
found that it purchased some ironing boards from Community producers as well. Taking into
account the different sources of supply of the company in question, and if the company is not
able to pass on 1/3 of the anti-dumping duty to retailers (see recital (148)), the impact on its gross
margin for ironing boards is estimated at not being more than 10 %. However, it should be noted
that the information received at this stage did not allow for an exact calculation. It should also be
recalled that the markup also of such importers appears to be substantial. Although, the investigation
on the situation of such importers will continue, it has been concluded that the provisional measures
would not affect significantly their business.

(154) One co-operating importer produces ironing board covers and sells them together with the imported
ironing boards. It was argued that any anti-dumping duty on imports of ironing boards would also
affect the production of covers and would thus have a significant impact on the turnover of this
company. However, it is noted that ironing board covers are also sold separately and the imposition
of anti-dumping measures would not affect such sales. It is also noted that the sales of ironing boards
did not represent more than 10 % of its turnover. Thus, the impact of the provisional measures on
the business of the company in question would also not be significant.

(155)

In addition, most importers, which are/were also trading Community products, admitted that it
would not be in their interest to become completely dependent on the imported ironing boards
— the PRC was particularly pointed out in this context — and confirmed that they prefer to have
alternative sources of supply. This can best be ensured by eliminating dumping practices so that the
Community industry will continue to exist.

(156)

In view of the above, and taking into account the elements summarised in recital (148) above, in
particular the high markups and the fact that the additional duty cost will be less than half a euro per
unit, it is provisionally concluded that any anti-dumping measures would not have a decisive adverse
impact on the situation of unrelated importers of ironing boards in the Community, although some
of them would likely bear a somewhat higher burden than the retailers. In any event, all comments
will be considered before reaching any final findings.

6.6. Conclusion on Community interest

(157) The above analysis showed that it is in the interest of the Community industry to impose measures,
since those measures are expected to, at least, restrain the high level of imports at dumped prices
which proved to have a significant negative impact on the situation of the Community industry. The
other Community producers are expected to also benefit from those measures.

(158) The analysis also demonstrated that consumers are not likely to be financially affected by any anti-
dumping measures. In the worse case scenario, they will have to pay in addition less than half a euro
for a durable good. On the other hand, without measures the consumers' choice could be negatively
affected since Community ironing boards may disappear from the market.

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(159) The distributors and retailers may see their purchase prices of the product concerned increased, but

they will probably not be significantly affected by measures given their high margins.

(160) The importers of the product concerned would likely bear a somewhat higher burden than the
retailers. However,
they would maintain the benefits of several sources of supply and avoid
becoming dependent on imports, which would in all likelihood be the case should measures not
be imposed.

(161) On balance, it is considered that imposing measures, i.e. removing injurious dumping, would allow
the Community industry to maintain its activity and that the adverse effects that the measures may
have on certain other economic operators in the Community are not disproportionate as compared
to the beneficial effects for the Community industry.

(162) On the basis of the above, it is provisionally concluded that no compelling reasons of Community

interest exist for not imposing anti-dumping measures in this case.

7. PROVISIONAL ANTI-DUMPING MEASURES

(163)

In view of
the provisional conclusions reached with regard to dumping, resulting injury and
Community interest, provisional measures on imports of the product concerned from the PRC
and Ukraine should be imposed in order
injury being caused to the
Community industry by dumped imports.

to prevent

further

7.1. Injury elimination level

(164) The level of the provisional anti-dumping measures should be sufficient to eliminate the injury to the
Community industry caused by the dumped imports, without exceeding the dumping margins found.

(165) When calculating the amount of duty necessary to remove the effects of the injurious dumping, it
was considered that any measures should allow the Community industry to cover its costs and obtain
a profit before tax that could be reasonably achieved under normal conditions of competition, i.e. in
the absence of dumped imports. The pre-tax profit margin used for this calculation was 7 % of
turnover. It was demonstrated that this was the profit level that could reasonably be expected in the
absence of injurious dumping, since it was the profit of the Community industry before the Chinese
and Ukrainian imports into the Community started to significantly increase during the period
considered. On this basis, a non-injurious price was calculated for the Community industry of the
like product. The non-injurious price has been obtained by adding the above mentioned profit
margin of 7 % to the cost of production.

(166) The necessary price increase was then determined on the basis of a comparison of the weighted
average import price, as established for the undercutting calculations, with the average non-injurious
price of products sold by the Community industry on the Community market. Any difference
resulting from this comparison was then expressed as a percentage of the average import cif
value. These differences were for all Chinese co-operating exporting producers above the dumping
margins found. In the case of Ukraine, the injury eliminating level was below the dumping margin
found for the sole exporting producer.

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7.2. Provisional measures

(167)

In the light of the foregoing, and in accordance with Article 7(2) of the basic Regulation,
it is
considered that the provisional anti-dumping measures should be imposed on imports originating
(i) in the PRC at the level of the dumping margins found and (ii) in Ukraine at the level eliminating
the injury.

(168) On the basis of the above, the rate of the provisional anti-dumping duty for the PRC and Ukraine

should be as follows:

Country

Company

PRC

Foshan City Gaoming Lihe Daily Necessities Co. Ltd, Foshan

Guangzhou Power Team Houseware Co. Ltd, Guangzhou

Since Hardware (Guangzhou) Co. Ltd, Guangzhou

Foshan Shunde Yongjian Housewares and Hardware Co. Ltd, Foshan

Zhejiang Harmonic Hardware Products Co. Ltd, Guzhou

All other companies

Ukraine

All companies

Anti-dumping
duty

34,9 %

36,5 %

0 %

18,1 %

26,5 %

38,1 %

10,3 %

(169) 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 countrywide
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
Imported products produced by any other company not specifically
legal entities mentioned.
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’.

(170) Any claim requesting the application of these individual company anti-dumping duty rates (e.g.
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 (1) forthwith with all relevant information, in
particular any modification in the company's activities linked to production, domestic and export
sales associated with e.g. that name change or that change in the production and sales entities. The
Commission, if appropriate, will, after consultation of the Advisory Committee, amend the Regu-
lation accordingly by updating the list of companies benefiting from individual duty rates.

(171)

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

(1) European Commission

Directorate General for Trade
Directorate B
J-79 5/17
Rue de la Loi/Wetstraat 200
B-1049 Brussels.

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8. FINAL PROVISION

(172)

In the interest of sound administration, a period should be fixed within which the interested parties
which made themselves known within the time limit specified in the notice of initiation may make
their views known in writing and request a hearing. Furthermore, it should be stated that the findings
concerning the imposition of duties made for the purposes of this Regulation are provisional and
may have to be reconsidered for the purpose of any definitive duty,

HAS ADOPTED THIS REGULATION:

Article 1

1.
A provisional anti-dumping duty is hereby imposed on imports of ironing boards, whether or not
free-standing, with or without a steam soaking and/or heating top and/or blowing top, including sleeve
boards, and essential parts thereof, i.e. the legs, the top and the iron rest originating in the People's Republic
ex 7323 93 90,
of China
ex 7323 99 91,
ex 8516 79 70 and ex 8516 90 00 (TARIC codes 3924 90 90 10,
4421 90 98 10, 7323 93 90 10, 7323 99 91 10, 7323 99 99 10, 8516 79 70 10 and 8516 90 00 51).

falling within CN codes

ex 7323 99 99,

ex 3924 90 90,

ex 4421 90 98,

and Ukraine,

The rate of the provisional anti-dumping duty applicable to the net, free-at-Community-frontier price,

2.
before duty, for products manufactured by the companies listed below shall be as follows:

Country

Company

Anti-dumping
duty

TARIC
additional code

PRC

Foshan City Gaoming Lihe Daily Necessities Co. Ltd, Foshan

Guangzhou Power Team Houseware Co. Ltd, Guangzhou

Since Hardware (Guangzhou) Co. Ltd, Guangzhou

Foshan Shunde Yongjian Housewares and Hardware Co. Ltd,
Foshan

Zhejiang Harmonic Hardware Products Co. Ltd, Guzhou

All other companies

Ukraine

All companies

34,9 %

36,5 %

0 %

18,1 %

26,5 %

38,1 %

10,3 %

A782

A783

A784

A785

A786

A999

—

The release for free circulation in the Community of the product referred to in paragraph 1 shall be

3.
subject to the provision of a security, equivalent to the amount of the provisional duty.

4.

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

Article 2

Without prejudice to Article 20 of Regulation (EC) No 384/96, interested parties may request disclosure of
the essential facts and considerations on the basis of which this Regulation was adopted, make their views
known in writing and apply to be heard orally by the Commission within one month of the date of entry
into force of this Regulation.

Pursuant to Article 21(4) of Regulation (EC) No 384/96, the parties concerned may comment on the
application of this Regulation within one month of the date of its entry into force.

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

Article 3

Article 1 of this Regulation shall apply for a period of six months.

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

Done at Brussels, 30 October 2006.

For the Commission

Peter MANDELSON
Member of the Commission