2006/781/EC: Commission Decision of 15 November 2006 terminating the anti-dumping proceeding concerning imports of cathode-ray colour television picture tubes originating in the People’s Republic of China, the Republic of Korea, Malaysia and Thailand
Date: 2006-11-15
Institutions: European Commission
Subjects: China, Malaysia, South Korea, Thailand, anti-dumping legislation, electronic component, import, originating product, television equipment

L 316/18

EN

Official Journal of the European Union

16.11.2006

COMMISSION DECISION

of 15 November 2006

terminating the anti-dumping proceeding concerning imports of cathode-ray colour television
picture tubes originating in the People’s Republic of China, the Republic of Korea, Malaysia and
Thailand

(2006/781/EC)

THE COMMISSION OF THE EUROPEAN COMMUNITIES,

Having regard to the Treaty
Community,

establishing the European

Having regard to Council Regulation (EC) No 384/96 of 22
December 1995 on protection against dumped imports from
countries not members of the European Communities (1) (the
basic Regulation), and in particular Article 9 thereof,

After consulting the Advisory Committee,

Whereas:

A. PROCEDURE

1. Initiation

(1)

(2)

On 11 January 2006, pursuant to Article 5 of the basic
Regulation,
the Commission announced by a notice
(notice of initiation) published in the Official Journal of
the European Union (2), the initiation of an anti-dumping
proceeding with regard to imports into the Community
of cathode-ray colour television picture tubes (CPT) origi-
nating in the Peoples Republic of China (PRC),
the
Republic of Korea (Korea), Malaysia and Thailand (the
countries concerned).

The proceeding was
initiated following a complaint
lodged on 29 November 2005 by the Taskforce against
unfair business in Europe (TUBE) (the complainant) on
two producers (the complainant producers),
behalf of
namely AB Ekranas (Ekranas) and Ecimex Group A.S.
(Ecimex), representing a major proportion of the total
Community production of cathode-ray colour television
contained prima facie
picture
evidence of dumping of CPT originating
in the
countries concerned and of material
injury resulting
there from, which was considered sufficient to justify
the initiation of a proceeding.

tubes. The

complaint

2. Parties concerned by the proceeding

(3)

The Commission officially advised the complainant, the
Community producers mentioned in the complaint, other

(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 6, 11.1.2006, p. 2.

the authorities of

known Community producers,
the
exporting countries concerned, the exporting producers,
importers, users as well as the associations known to be
concerned of the initiation of the proceeding. Interested
parties were given the opportunity to make their views
known in writing and to request a hearing within the
time limit set in the notice of initiation.

The complainant producers, other Community producers,
importers and users made their
exporting producers,
interested parties, who so requested
views known. All
reasons why
there were particular
and showed that
they should be heard, were granted a hearing.

In view of the anticipated large number of exporting
producers in the PRC, 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 of exporting producers in the PRC would be
necessary and,
if so, to select a sample, all exporting
producers in the PRC were requested to make themselves
known and to provide, as specified in the notice of
initiation, basic information on their activities related to
the product concerned during the period of 1 January to
31 December 2005.

Only two exporting producers in the PRC came forward
and provided the requested information within the time
In these circumstances, the
limit set for this purpose.
Commission decided that sampling was not necessary
with regard to the exporting producers in the PRC.

Moreover, in order to allow exporting producers in the
PRC to submit a claim for market economy treatment
(MET) or individual treatment (IT), if they so wished, the
Commission sent market economy treatment and indi-
vidual treatment claim forms to the Chinese companies
known to be concerned as well as to the Chinese autho-
rities. Two exporting producers in the PRC requested
MET pursuant to Article 2(7) of the basic Regulation.

(4)

(5)

(6)

(7)

(8)

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Official Journal of the European Union

L 316/19

(9)

(10)

The Commission sent questionnaires to all parties known
to be concerned, and to all other companies that made
themselves known within the time limits set out in the
initiation. Replies were received from two
notice of
from one exporting
exporting producers in the PRC,
producer in Korea, in Malaysia and in Thailand respect-
ively, from one importer in the Community related to
one of the Chinese exporters and to the Korean exporter,
from one trader located in a country other than the
country concerned or the Community and related to
Community
one
producers,
in the
Community.

and from one unrelated user

from three

producer,

Chinese

The Commission sought and verified all the information
it deemed necessary for the purpose of a preliminary
determination
and
Community interest. Verification visits were carried out
at the premises of the following companies:

dumping,

resulting

injury

of

(a) Community producers

3. Investigation period

(11)

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

examination of

relevant

trends

for

B. PRODUCT CONCERNED AND LIKE PRODUCT

1. Product concerned

(12)

The product concerned is cathode-ray colour television
picture tubes (CPT), including video monitor cathode-ray
tubes, of all sizes, originating in the PRC, Korea, Malaysia
and Thailand (the product concerned), normally declared
within CN codes 8540 11 11, 8540 11 13, 8540 11 15,
8540 11 19, 8540 11 91 and 8540 11 99.

— AB Ekranas, Panevezys, Lithuania and its related
company Farimex SA, Geneva, Switzerland,

(13)

— Thomson Displays Polska Sp. Zo.o, Piaseczno,

Poland, (Thomson);

(b) Exporting producers in the PRC

— Beijing Matsushita Color CRT Co., Ltd, Bejing,

— Hua Fei Colour Display Systems Co., Ltd, NanJing,
and its related producer LG Philips Shuguang
Electronic Co., Ltd, Changsha;

(14)

(c) Exporting producer in Korea

— LG Philips Displays Korea Co., Ltd, Seoul;

(d) Exporting producer in Malaysia

— Chunghwa Picture Tubes (Malaysia) Sdn. Bhd,

Shah Alam;

(e) Exporting producer in Thailand

— CRT Display Technology Co., Ltd, Rayong and its
related producer Thai CRT Co., Ltd., Chonburi;

(15)

(f) Related importer in the Community

— LG. Philips Displays Netherlands BV (The Neth-

erlands).

The product concerned can have a diagonal measurement
of the screen (i.e. the active part of the picture tube
measured in a straight line) of any size, with a screen
width/height ratio of any number, and with a pitch (i.e.
the gap between two lines of the same colour at the
centre of
than 0,4 mm.
the products can be specified by the
Furthermore,
flatness of
the bulb-type (including semi-
flat/full square), the flat tubes and real flat or flat-slim
tubes. Finally, they can operate under a frequency of 50,
60 or 100 Hz. These products are mainly, but not exclu-
sively, applied in colour television sets.

screen) of not

their tubes:

less

the

some exporting producers

The product concerned is commonly designated as 14
inch, 15 inch, 20 inch, etc.
tubes depending on the
diagonal measurement of the screen and is marketed in
inches. It is usually sold on the market as a complete
tube, which is the case for the complainant Community
producers. However,
sold
CPTs before they were completed,
i.e. without one or
more of the components, mainly the deflection yoke.
In these cases, CPTs are described as bare tubes. The
investigation showed that these tubes already have the
essential characteristics of a complete CPT in respect of
characteristics.
their
Therefore,
single product with the
they
complete CPTs.

technical

form a

physical

basic

and

2. Like product

characteristics

and uses of

There were no differences between the basic physical and
the product
technical
concerned and the CPTs produced and sold on the
PRC, Korea,
respective
Thailand and Malaysia, which also served as
an
analogue country, as well as those produced and sold
in the Community by the Community industry.

domestic markets

in the

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(16)

these products are considered to be alike
Therefore,
within the meaning of Article 1(4) of the basic Regu-
lation.

C. DUMPING

1. Market Economy Treatment (MET)

(17)

Pursuant to Article 2(7)(b) of the basic Regulation,
in
anti-dumping investigations concerning imports origi-
nating in the PRC, normal value shall be determined in
accordance with paragraphs 1 to 6 of the said Article for
those producers which were found to meet the criteria
laid down in Article 2(7)(c) of
the basic Regulation.
Briefly, and for ease of reference only, these criteria are
set out in summarised form below:

(21)

— business decisions are made in response to market
signals, without significant State interference, and
costs reflect market values,

— firms have one clear set of basic accounting records,
which are independently audited in line with interna-
tional accounting standards and are applied for all
purposes,

(22)

— there are no significant distortions carried over from

the former non-market economy system,

— bankruptcy and property laws guarantee stability and

legal certainty,

— exchange rate conversions are carried out at market

(23)

rates.

(18)

Two exporting producers in the PRC 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 deadline. A MET claim form was
submitted also by a company located in the PRC that
is related to one of the exporting producers and involved
in the production of the product concerned. Indeed, it is
the Commissions consistent practice to examine whether
a group of related companies as a whole fulfils the
conditions for MET. For
the
Commission sought and verified at
their premises all
information submitted in the MET application as
deemed necessary.

these three companies,

(19)

The investigation revealed that all companies having
requested MET fulfilled all conditions for being granted
MET.

(20)

The two exporting producers in the PRC which obtained
MET are:

— Beijing Matsushita Color CRT Co., Ltd, Bejing,

— Hua Fei Colour Display Systems Co., Ltd, NanJing,
and its related producer LG. Philips Shuguang Elec-
tronic Co., Ltd, Changsha.

2. Normal value

2.1. General methodology

The general methodology as described below has been
applied to all exporting producers in Korea, Thailand and
Malaysia and to those exporting producers in the PRC
which were granted MET. The subsequent presentation of
the findings on dumping for the countries concerned
therefore
each
exporting country.

describes

specific

issues

only

to

2.1.1. G l o b a l r e p r e s e n t a t i v e n e s s

In accordance with Article 2(2) of the basic Regulation,
the Commission first examined for each exporting
producer concerned whether its domestic sales of the
product concerned to independent customers were repre-
sentative, i.e. whether the total volume of such sales was
equal to or greater than 5 % of its total export sales
volume of the product concerned to the Community.

2.1.2. C o m p a r i s o n o f p r o d u c t

t y p e s

The Commission subsequently identified those types of
the product concerned sold domestically by the exporting
producers having overall representative domestic sales,
which were identical or directly comparable with the
types sold for export to the Community. The criteria
used are the following:
the diagonal measurement of
the viewable screen in inches, the width/height aspect
ratio, the tube type (bulb, flat screen or flat slim), the
pitch size in millimetres and the frequency).

(24)

2.1.3. P r o d u c t
t i v e n e s s

t y p e

s p e c i f i c

r e p r e s e n t a -

For each product type sold by the exporting producers
on their domestic markets and found to be directly
comparable with the product type sold for export to
the Community,
it was established whether domestic
sales were sufficiently representative for the purposes of
Article 2(2) of the basic Regulation. Domestic sales of a
considered sufficiently
particular product
representative when the total volume of that product
type sold on the domestic market
to independent
customers during the IP represented 5 % or more of
the total sales volume of the comparable product type
exported to the Community.

type were

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2.1.4. O r d i n a r y c o u r s e o f

t r a d e t e s t

(25)

examined for

The Commission subsequently
each
exporting producer in each exporting country whether
the domestic sales of each product type sold domestically
in representative quantities could be regarded as being
sold in the ordinary course of trade pursuant to Article
2(4) of the basic Regulation.

(26)

This was done by establishing the proportion of pro-
fitable domestic sales to independent customers of each
exported product type during the IP.

(27) Where the volume of profitable sales of a product type
represented 80 % or less of the total sales volume of that
type, or where the weighted average price of that type
was below the cost of production, normal value was
based on the actual domestic price, calculated as a
weighted average of profitable sales of that type only,
provided that these sales represented 10 % or more of
the total sales volume of that type.

(28) Where the volume of profitable sales of any product type
represented less than 10 % of the total sales volume of
that type, it was considered that this particular type was
sold in insufficient quantities for the domestic price to
provide an appropriate basis for the establishment of the
normal value.

(29) Wherever domestic prices of a particular product type
sold by an exporting producer could not be used in
order to establish normal value, another method had to
the Commission used
be
regard,
constructed normal value,
in accordance with Article
2(3) of the basic Regulation.

In this

applied.

(30) When constructing normal value pursuant to Article 2(3)
of the basic Regulation, the selling, general and adminis-
trative (SG&A) expenses
incurred and the weighted
the cooperating
realised by each of
average profit
exporting producers concerned on their domestic sales
of
trade,
during the IP, was added to their own average cost of
manufacturing during the IP. Where necessary, the manu-
reported were
facturing costs and SG&A expenses
adjusted, before being used in the ordinary course of
trade test and in constructing normal values.

in the ordinary course of

the like product,

2.2. PRC

2.2.1. C o m p a n i e s g r a n t e d M E T

(31)

Since both cooperating exporting producers in the PRC
were granted MET, normal value for them was estab-
lished in line with the methodology set out in recitals
21 to 30, on the basis of the information submitted by

these producers on their domestic prices and their cost of
production for the product concerned. Normal value
could be based on actual domestic prices as
the
companies had sufficient domestic sales in the ordinary
course of trade for all product types. For one of the
exporting producers with a related producer, the conso-
lidated data on the domestic prices
and cost of
production of both companies were used in order to
establish normal value.

2.2.2. A n a l o g u e c o u n t r y

(32) According to Article 2(7) of the basic Regulation, for
economies in transition, for the companies not granted
MET, normal value has to be established on the basis of
the prices or constructed value in an analogue country.

(33)

In the notice of initiation, the Commission indicated that
it envisaged using Malaysia as an appropriate analogue
country for the purpose of establishing normal value for
the PRC and interested parties were invited to comment
on this.

(34) No interested party has objected to the selection of

Malaysia as an analogue country.

(35)

In view of the above, and taking also into account that
Malaysia is a competitive market and that
its size is
representative, it was concluded that Malaysia constitutes
an appropriate analogue country in accordance with
Article 2(7)(a) of the basic Regulation.

2.3. Korea, Malaysia, Thailand

(36)

types. For the Korean producer,

For the sole cooperating exporting producer from each of
the above countries normal value was established in line
with the methodology set out in recitals 21 to 30. For
the Malaysian producer, normal value could be based on
actual domestic prices as the company had sufficient
domestic sales in the ordinary course of trade for all
the normal
product
value was constructed for one out of total two product
types exported to the Community and for the Thai
producer normal value was constructed for the single
product type. With regard to the cooperating exporting
the consolidated data on the
producer
domestic prices
that
company and of its related producer was used in order
to establish normal value, because these two companies
functioned as one fully integrated business-operation for
the product
exporting
concerned. For one of
producers with a related producer,
the consolidated
data on the domestic prices and cost of production of
both companies were used in order to establish normal
value.

and cost of production of

in Thailand,

the

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3. Export price

(37)

in the Community,

sales made to related end-users
In case of export
(producers of CTVs)
these sales
were not taken into account in the calculations of the
dumping margins as the product produced by the end-
users did not fall under the scope of the investigation.
The volume of these sales was relatively small (slightly
above 10 % of the total EU exports of the companies
concerned) and the sales to unrelated customers were
considered to give a representative picture.

(43)

(38) Where the product concerned was exported to inde-
pendent customers in the Community, the export price
was established in accordance with Article 2(8) of the
basic Regulation, namely on the basis of export prices
actually paid or payable.

(39) Where sales were made via a related importer, the export
price was established in accordance with Article 2(9) of
the basic Regulation on the basis of price at which the
imported products were first resold to an independent
buyer. In these cases, adjustments were made for all costs
incurred between importation and resale,
including
SG&A expenses, and for profits accruing.

(40) Where sales were made via a related trader located
outside the Community, the export price was established
on the basis of the first resale prices to independent
customers in the Community.

3.1. PRC

through two related companies

(41) One exporting producer in the PRC made export sales to
the Community either directly to independent customers
or
located in the
Community. The other exporting producer made all its
exports
the
independent
Community via its related company located outside the
Community.

customers

sales

to

in

(42) One of

the companies related to the first exporting
producer failed to cooperate with the investigation as it
did not submit a response to the questionnaire intended
for related companies involved in the sales or marketing
of
the product concerned destined for the European
Community. The exporting producer claimed that the
sales made via that company should not be considered
related sales since there allegedly no longer was a de
facto association between the companies concerned. In
any event, at least during the IP there was a legal rela-
tionship, as defined in Article 143 of Commission Regu-
lation (EEC) No 2454/93 of 2 July 1993 laying down
provisions for the implementation of Council Regulation
(EEC) No 2913/92 establishing the Community Customs
Code (1), due to a common ultimate mother company.

in view of this apparent partial cooperation,
Therefore,
the Commission, having made the exporting producer
concerned aware of
the consequences of non-coop-
eration, used facts available for the determination of
the export price for the sales made via this non-coop-
erating related company pursuant to the provisions of
Article 18 of the basic Regulation.

that

in the calculation of

It was also claimed by the exporting producer that, for
the companies concerned would be
the event
considered related,
the sales made via the non-coop-
erating related company to the end-customer should
also be considered related sales, given the exclusive
end-customer
contractual
arrangements between the
and the ultimate mother company of
the exporting
producer, and should therefore not be taken into
account
the dumping margin.
However, since the conditions set out in Article 143(2)
of Regulation (EEC) No 2454/93 were not met, the sales
to
considered
unrelated sales. In this regard, the resales prices to this
first independent customer were established by adding to
the transfer price the mark-up found in the case of the
cooperating related importer. Subsequently,
in order to
establish the export price at Community frontier level,
the adjustments made in the case of the cooperating
(costs between importation and sales, SGA
importer
expenses and a reasonable profit margin) were applied
to the resales price as calculated above.

concerned were

end-customer

the

(44)

In the absence of cooperation by independent importers
and in view of the fact that CPTs pertain to the same
brown goods sector as colour television receivers (CTV),
it was considered reasonable to revert for this purpose to
the profit margin of 5 % used in the CTVs anti-dumping
proceeding (2).

3.2. Korea

(45)

The sole cooperating exporting producer made exports of
the product concerned to the Community via a related
importer. The export price was therefore established on
the basis of the resale prices to independent customers.

(46)

For the adjustment, the profit margin indicated in recital
44 was used.

3.3. Malaysia, Thailand

(47)

The product concerned was exported by both coop-
erating exporting producers to independent customers
in the Community. Therefore, the export price was estab-
lished in accordance with Article 2(8) of the basic Regu-
lation, namely on the basis of export prices actually paid
or payable.

(1) OJ L 253, 11.10.1993, p. 1. Regulation as last amended by Regu-

(2) See recital 59 of Council Regulation (EC) No 1531/2002 (OJ L 231,

lation (EC) No 883/2005 (OJ L 148, 11.6.2005, p. 5).

29.8.2002, p. 1).

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4. Comparison

(48)

The normal value and export prices were compared on
an ex-works basis and at the same level of trade. For the
purpose of ensuring a fair comparison between the
normal value and export prices, due allowance in the
form of adjustments was made for differences affecting
prices and price comparability in accordance with Article
2(10) of the basic Regulation.

(49) On this basis, for all

for differences

investigated exporting producers,
insurance,
allowances
loading and ancillary costs, packing costs,
handling,
credit costs, commissions and after sales costs (warran-
ty/guarantee) were made where applicable and justified.

in transport,

claimed

in Korea

exporting producer

(50) One exporting producer in the PRC and the sole coop-
erating
an
adjustment for currency conversions pursuant to Article
2(10)(j) of the basic Regulation. They argued that since
the local currencies (CNY and KRW respectively) declined
against the Euro during the IP, an equivalent adjustment
on the invoiced amount
for the export sales to the
Community denominated in Euro should be made. In
it was found contrary to the claims, that
this respect,
both currencies had appreciated against the Euro during
the IP. Thus, these claims were found to be irrelevant and
were therefore rejected.

(51)

(52)

The same exporting producers claimed an adjustment for
level of trade, pursuant to Article 2(10)(d)(ii) of the basic
Regulation, by alleging that
their export sales to the
Community were made to distributors whereas their
domestic
In this
respect,
independent
customers on both markets were end-users. Conse-
quently, this claim was considered unfounded and was
therefore rejected.

sales where made
found that

to end-users.
first
the

it was

for other

factors pursuant

competition from flat panel displays

The same cooperating exporting producers claimed an
adjustment
to Article
2(10)(k) of the basic Regulation. The companies argued
that the sharp fall in prices of CPTs during the IP due to
the
affected
and export prices. They
differently their domestic
alleged that this was because of the fact that while the
volume of sales on the domestic market was spread
evenly over the course of
their exports were
concentrated only to a part of the IP. However, this
claim was not accepted since it was not demonstrated
that it affected price comparability nor was it demon-
strated that customers consistently paid different prices
on the domestic market because of this factor.

the IP,

(53) Adjustments pursuant to Article 2(10)(b) of the basic
Regulation were
in the
also made
Chinese VAT reimbursement, as it was found that a

for differences

(54)

(55)

(56)

(57)

lower level of VAT was reimbursed on export sales
than that which was reimbursed for domestic sales.

In the case of one exporting producer in the PRC, which
exported via its related trader outside the Community, an
adjustment was also made to the export price, pursuant
to Article 2(10)(i) of
the basic Regulation, since this
trader performed functions similar to an agent working
on a commission basis. The adjustment pursuant to this
Article was made at the level of 2 % since this level was
considered reasonable to reflect commissions paid to
the
agents
independent
product concerned.

involved in the

trade of

5. Dumping margin

5.1. Individual dumping margins

For all the investigated exporting producers, dumping
margins 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 estab-
lished above, pursuant to Article 2(11) and 2(12) of the
basic Regulation.

It has been the practice of the Commission to establish
for related exporting producers or producers belonging
to the same group only one weighted average dumping
margin based on the individual dumping margins. This is
in particular because calculating individual duty rates
might
anti-dumping
circumvention
measures, thus rendering them ineffective, by enabling
related exporting producers to channel their exports to
the Community through the company with the lowest
individual dumping margin.

encourage

of

In accordance with this practice, a single dumping
margin was attributed to the cooperating exporting
producers in the PRC belonging to the same group, i.e.
Hua Fei Colour Display Systems Co., Ltd and its related
producer LG Philips Shuguang Electronic Co., Ltd.
Similarly, a single dumping margin was attributed to
the Thai cooperating exporting producers belonging to
the same group,
i.e. CRT Display Technology Co., Ltd
and its related producer Thai CRT Co., Ltd.

5.2. Countrywide dumping margins

(58)

For those exporting producers which neither replied to
the Commissions questionnaire nor otherwise made
themselves known, the dumping margin was established
on the basis of the facts available,
in accordance with
Article 18(1) of the basic Regulation.

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Official Journal of the European Union

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(59)

(60)

(61)

(62)

In order to determine the countrywide 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
cooperating exporting producers was compared with the
equivalent Eurostat import statistics.

i.e.

less

low,

Indeed,

than 80 %,

In the case of Malaysia and Thailand, where the level of
cooperation was
it was
considered appropriate to set the dumping margin for
the non-cooperating exporting producers at a level
higher than the highest dumping margin established for
the cooperating exporting producers.
there is
reason to believe that
the low level of cooperation
results from the non-cooperating exporting producers
in the investigated country generally having dumped at
a higher level than any cooperating exporting producer.
Moreover, there were no indications that any non-coop-
erating company was dumping at a lower level and no
bonus
should be given for non-cooperation. The
dumping margins were therefore established on the
highest margins established for representative types of
one cooperating producer in the countries concerned
representative
or
transactions by one
in the
countries concerned.

the highest margins established for

cooperating producer

of major

non-cooperation

In the case of the Republic of Korea, the extremely low
level of cooperation,
i.e. only 2 % of total exports in
volume based on Eurostat statistics, shows clearly a
deliberate
exporting
producers. In view of this peculiar situation, and in the
absence of any more appropriate information,
it was
considered appropriate to set a dumping margin for
the
the non-cooperating companies at
dumping margin for a representative product
type
indicated in the complaint, namely, 15,0 %. The level
of the dumping margin indicated in the complaint was
checked by reference to published price lists and Eurostat
statistics.

the level of

the volume of exports

In the case of the PRC, the level of cooperation was very
to the Community
high as
reported by the cooperating exporting producers during
the IP exceeded the import volumes according to the
Eurostat data and as there was no reason to believe
that any exporting producer deliberately abstained from
cooperation. In order to differentiate between the coop-
erating Chinese exporting producers who have all been
granted MET, and potential other Chinese exporting
producers that have not cooperated in the investigation,
it was considered appropriate to establish the coun-
trywide dumping margin for
the PRC based on a
comparison between the export prices of the most sold
representative product types according to the Eurostat
data and the normal value of the same product types
in the analogue country.

(63)

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

(a) Peoples Republic of China

— Beijing Matsushita Color CRT Co., Ltd

0 %

— Hua Fei Colour Display Systems Co.,
Ltd and LG Philips Shuguang Electronic
Co., Ltd

— all other companies

(b) Republic of Korea

— LG Philips Display Korea Co., Ltd

— all other companies

(c) Malaysia

— Chunghwa Picture Tubes Sdn Bhd

— all other companies

(d) Thailand

— Thai CRT Co., Ltd and CRT Display

Technology Co., Ltd

— all other companies

D. INJURY

25,5 %

28,3 %

0 %

15,0 %

5,1 %

14,5 %

41,4 %

47,2 %

1. Community production and Community industry

(64) During the IP, the like product was produced by seven
Community producers. However, four of these producers
are related to exporters in the countries concerned. These
four companies might thus be shielded from the negative
consequences of the injurious dumping due to their rela-
tionship with the exporter. This is also indicated by the
these producers did not cooperate in the
fact
proceeding.
It was considered appropriate to exclude
their output from the Community production and also
to exclude them from the definition of the Community
industry. Furthermore, two of these four producers have
definitively stopped production after the IP.

that

(65)

Therefore the output of three producers, namely Ekranas,
Ecimex and Thomson, constitute the total Community
production within the meaning of Article 4(1) of the
basic Regulation.

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(66) As indicated in recital 2, the complaint was lodged on behalf of two Community producers, namely
Ekranas and Ecimex. Those complainants were found to account for a major proportion of the total
Community production of the product concerned, i.e. in this case more than 40 %.

(67)

It should be noted that both complainants, which produced the like product during the IP, stopped
production and filed for bankruptcy during the first half of 2006. As bankruptcy proceedings are
presently on-going, it is still unclear whether production of CPT by Ekranas and Ecimex will resume
or not. After the initiation of the proceeding, Thomson has informed the Commission of their
support
lodged by TUBE, and properly cooperated in the investigation.
Therefore,
in the absence of information that these two producers had definitively stopped their
operation, Ekranas and Ecimex are still considered to be part of the Community industry. Ekranas,
Ecimex and Thomson are therefore deemed to constitute the Community industry within the
meaning of Article 4(1) and Article 5(4) of the basic Regulation and will hereinafter be referred
to as the Community industry.

to the complaint

2. Community consumption

(68)

Community consumption was established on the basis of the sales volumes of the Community
industry’s own production on the Community market, the sales volumes obtained from the other
producers and the import volumes data obtained from Eurostat.

(69)

Between 2002 and the IP, the Community market for the product concerned declined by around
14 %. Community consumption was around 9,5 million pieces in 2002, and around 8,2 million
pieces in the IP. Specifically, it decreased by 2 % in 2003, rose by seven percentage points in 2004,
and dropped suddenly by almost 20 percentage points in the IP.

Total EC consumption (pieces)

9 540 185

9 387 212

10 023 216

8 170 802

Index (2002 = 100)

100

98

105

86

2002

2003

2004

IP

(70)

Further to disclosure of the provisional findings, the complainant contested the methodology used by
the Commission to establish consumption. More precisely, the complainant claimed (i) that on the
basis of the information provided in recital 64, it would appear that all the sales made by those
Community producers related to exporters in the countries concerned had been excluded from the
calculation of consumption and from the injury analysis, and (ii) that certain volumes of captive sales
supplied by one of the three Community producers mentioned in recital 67 had been improperly
excluded from the calculation of the consumption whereas they should have been included.

(71) As to claim (i), it must be noted that recital 64 refers only to the definition of the Community
industry and the establishment of the total Community production within the meaning of Article
4(1) of the basic Regulation, and not to the calculation of the total Community consumption. For the
establishment of the Community consumption, the sales from those producers who were excluded
from the definition and production of the Community industry were included. This is also evident
from recital 68 and from specific information disclosed to the complainant showing that the sales
volume in question amounted to around 3 million pieces during the IP. Therefore, the sales of all
producers within the Community, known to the complainant and to the Commission to have been
operating during the period 2002 to the IP, have been included in the establishment of consumption.
However, the producers excluded from the definition of Community industry had to be excluded
from the analysis of the situation of the Community industry precisely because they were not
considered to be part of it, in line with Article 4(1) of the basic Regulation. Claim (i) is therefore
rejected.

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(72) As regards claim (ii), it is indeed true that the Commission excluded certain sales volumes from the
calculation of consumption and from the analysis of some key injury indicators, notably sales volume
and prices, market share and profitability, as these sales were considered to be captive. It is a long-
standing practice of the Commission to separate captive sales from sales on the open market because
only sales on the open market enter in competition with each other (1). Conversely, captive sales do
not compete with products sold on the free market and are therefore not affected by the dumped
imports. In this particular industry, most of the large producers of the like product (unlike the two
complainants) also have operations in the downstream industry, namely the further processing of the
TV tube into a TV set. As an example, the Commission has excluded from the analysis the captive
sales made by Sony, and this approach was supported by the complainant. The same methodology
has been applied consistently to all Community producers, be they part of the Community industry
or considered as ‘other Community producers’ and referred to in recital 64.

(73)

Concerning the particular volumes of captive sales mentioned under claim (ii), the Commission
observed that until July 2004, the tube factory which is today incorporated as Thomson Displays
Polska Sp. Zo.o, Piaseczno, Poland, was, together with the TV sets factory of Zyrardow, Poland,
incorporated under one single legal entity, namely the company TMM Polska, itself wholly owned by
the mother company Thomson SA. In line with standard practice, the Commission considered that it
was in the presence of an integrated producer and that supplies of the like product from the tube
factory of Piaseczno to the TV set factory of Zyrardow constituted an internal transfer, and were thus
captive sales made at transfer prices. The claimant de facto acknowledged the situation of transfer
pricing as it stated that ‘the relationship between Thomson Display and Thomson’s CTV display could have
influenced prices, but it does certainly not influence quantities’. The Commission therefore confirms that
these transfers cannot be considered alike sales on the free market.

(74)

Finally and for the sake of clarity only, it should be noted that, even if those captive sales were to be
included in the consumption (see table just below), only the total levels would change, but the trend,
namely the substantial demand contraction of the IP would remain very similar to the one described
in recital 69. Claim (ii) is therefore rejected.

2002

2003

2004

IP

Total EC consumption based on captive and non-
captive sales (pieces)

15 655 283

14 243 625

12 850 690

9 425 280

Index (2002 = 100)

100

91

82

60

3. Imports from the countries concerned

(a) Cumulative assessment of the effects of the imports concerned

(75)

(76)

The Commission considered whether imports from the countries concerned should be assessed
cumulatively on the basis of
in Article 3(4) of the basic Regulation. The
Commission verified that (i) the dumping margin established for each country concerned is more
than the de minimis threshold as defined in Article 9(3) of the basic Regulation and (ii) conditions of
competition between imported products and the like Community product are similar.

the criteria set out

It is firstly noted that the data pertaining to Beijing Matsushita Color CRT Co., Ltd and to LG Philips
Display Korea Co., Ltd, i.e. the two exporting producers in the countries concerned which were found
not to have dumped the product concerned, have been properly excluded from the following
imports
analysis, which concerns exclusively dumped imports. For information,
from the two aforementioned producers was marginal during the IP as it was significantly less
than 1 % of Community consumption.

the volume of

(1) See notably hot-rolled coils (HRC) case, recitals 37 to 49 of Commission Decision No 283/2000/ECSC (OJ L 31,

5.2.2000, p. 15).

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(77) On this basis, the dumping margin found for each of the countries concerned was above the de
minimis threshold as defined in Article 9(3) of the basic Regulation and the volume of dumped
imports from each of these countries was not negligible in the sense of Article 5(7) of the basic
Regulation, their market shares attaining between 3,6 % and 6,5 %, depending on the country
concerned in the IP. As regards the conditions of competition between the dumped imports from
the countries concerned and the like Community product, it was found that there were indeed similar
conditions of competition. This was evidenced by the fact that the product concerned imported from
the countries concerned and the like product produced and sold by the Community industry within
the Community market were alike, compete against each other and are distributed via the same trade
channels. Moreover all import volumes were substantial and resulted in significant market shares.

(78)

In the light of the above, it was considered that all the criteria set out in Article 3(4) of the basic
Regulation were met. The dumped imports from the four countries concerned were therefore
examined cumulatively.

(b) Volume

(79)

The volume of dumped imports into the Community of the product concerned originating from the
countries concerned stood just below 1,6 million pieces in the IP, a level close to that observed in
2002. This apparent stability hides sharp variations in the years 2003, 2004 and the IP. Imports rose
by 44 % in 2003, declined by three percentage points in 2004 and dropped further by 44 percentage
points in the IP.

2002

2003

2004

IP

Volume of dumped imports from the countries
concerned (pieces)

1 626 027

2 337 736

2 296 547

1 585 294

Index (2002 = 100)

100

144

141

97

Market
countries concerned

share of dumped imports

from the

17,0 %

24,9 %

22,9 %

19,4 %

Prices of dumped imports
concerned (EUR/piece)

from the countries

50

Index (2002 = 100)

100

43

85

32

64

39

76

(c) Market share

(80)

The market share held by exporters in the countries concerned increased from 17 % in 2002 to
19,4 % in the IP. In detail, the market share experienced a jump by almost eight percentage points in
2003, declined by around two percentage points in 2004 and dropped further by around 3,5
percentage points in the IP. The fact that the market share of the imports from the countries
concerned was higher in the IP than in 2002, although there were fewer imports in volume in
the IP than in 2002 can be explained by a sudden drop in consumption as described in recital 69.

(d) Prices

(i) P r i c e e v o l u t i o n

(81)

Between 2002 and the IP, the average price of imports of the product concerned originating in the
countries concerned declined by 24 %. Specifically, the price dropped by 15 % in 2003, by a further
21 percentage points in 2004, before increasing again by 12 percentage points in the IP.

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(ii) P r i c e u n d e r c u t t i n g

(82) A model-to-model price comparison was made between the exporting producers and the Community
industry’s weighted average selling prices in the Community. To this end, Community industry’s ex-
works prices to unrelated customers have been compared with the compared to cif Community
frontier import prices, of co-operating exporting producers of the countries concerned, duly adjusted
in order to reflect a landed price. The comparison showed that during the IP, the product concerned
originating in the countries concerned sold in the Community undercut the Community industry’s
prices by between – 37 % (i.e. no undercutting) and a maximum of 13 %, depending on the exporter
concerned. Overall, undercutting was very limited. However, Eurostat data indicate that in the years
preceding the IP, the prices of the dumped imports from the countries concerned were substantially
lower than those of the Community industry.

4. Situation of the Community industry

(83)

Pursuant to Article 3(5) of the basic Regulation, the examination of the impact of the dumped
imports on the Community industry included an evaluation of all relevant economic factors and
indices having a bearing on the state of the Community industry during the period considered.

(a) Production

(84)

Between 2002 and the IP, the Community industry’s production decreased by 5 %. Specifically, it
increased by 8 % in 2003, by a further 12 percentage points in 2004 and finally declined sharply by
25 percentage points in the IP.

Production (pieces)

9 727 029

10 461 957

11 685 396

9 276 778

2002

2003

2004

IP

Index (2002 = 100)

100

108

120

95

(b) Capacity and capacity utilisation rates

(85)

The production capacity increased steadily throughout the period considered. It rose by 4 % in 2003,
by a further 19 percentage points in 2004 and finally by five percentage points in the IP. This
corresponds to an increase in machinery.

Production capacity (pieces)

11 865 163

12 297 545

14 626 819

15 133 449

2002

2003

2004

IP

Index (2002 = 100)

100

104

123

128

Capacity utilisation

82 %

85 %

80 %

61 %

Index (2002 = 100)

100

104

97

75

(86)

Capacity utilisation stood in the range of 80 to 85 % in the years 2002 to 2003, before declining
sharply to 61 % in the IP.

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(c) Stocks

(87)

It

Between 2002 and the IP, there were large fluctuations in the level of inventories of finished
products.
first declined sharply in 2003, reflecting the economic climate for this particular
product which was still good in 2002 and 2003, before rising sharply at the end of 2004, reflecting
the sudden drop in demand. During the IP, the level of actual production was adapted downwards, as
seen above, and the level of closing stock came back to a more sustainable level.

Closing stock (pieces)

627 641

56 996

943 655

278 406

Index (2002 = 100)

100

9

150

44

2002

2003

2004

IP

(d) Sales volume

(88)

The sales by the Community industry of
its own production to unrelated customers on the
Community market initially increased by 6 % in 2003, rose further by 16 percentage points in
2004, but then declined by six percentage points in the IP. Overall, during the period considered
the sales volume increased by 16 %. The substantial gap between the volumes of production and of
domestic sales is explained by the fact that the Community industry exports around two thirds of its
production outside of the Community.

EC Sales volume to unrelated customers (pieces)

2 645 562

2 814 515

3 229 069

3 078 543

Index (2002 = 100)

100

106

122

116

2002

2003

2004

IP

(e) Market share

(89)

The market share held by the Community industry rose steadily, by 10 percentage points, between
2002 and the IP. Specifically, it was close to 28 % in 2002, rose to 30 % in 2003 and to around
32 % in 2004, before rising finally to close to 38 % during the IP. This increase of market share has
to be seen against the background of a declining consumption in the EC as described in recital 69.

Market share of Community industry

27,7 %

30,0 %

32,2 %

37,7 %

Index (2002 = 100)

100

108

116

136

2002

2003

2004

IP

(f) Growth

(90)

Between 2002 and the IP, when the Community consumption decreased by 14 %, the volume of
sales of the Community industry on the Community market increased by 16 %. The Community
industry gained around 10 percentage points of market share, whereas dumped imports gained
around 2,4 percentage points of market share between 2002 and the IP.

(g) Employment

(91)

The employment level of the Community industry declined by around 10 % between 2002 and the
IP. It decreased by 4 % between 2002 and 2003, increased by six percentage points in 2004, but
declined by 12 percentage points in the IP, reflecting partly the decrease of production.

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Employment (persons)

9 604

9 254

9 805

8 632

2002

2003

2004

IP

Index (2002 = 100)

100

96

102

90

(h) Productivity

(92)

increased by 12 % in 2003,

Productivity of the Community industry’s workforce, measured as output (in pieces) per person
increased further by six percentage points in
employed per year,
2004, and finally decreased by 12 percentage points in the IP. Confronted with the IP sudden
market contraction,
the volume of production was adjusted immediately, but as is commonly
observed, the adjustment of the labour force was less rapid, thereby triggering the observed produc-
tivity loss.

Productivity (pieces per employee)

1 013

1 131

1 192

1 075

2002

2003

2004

IP

Index (2002 = 100)

100

112

118

106

(i) Wages

(93)

The average wage per employee in the IP remained approximately at the same level as in 2002.
Specifically, it decreased by 11 % in 2003, by a further two percentage points in 2004 and finally
increased by 14 percentage points in the IP.

Annual labour cost per employee (000 EUR)

Index (2002 = 100)

2002

2003

2004

11

100

10

89

10

87

IP

11

101

(j) Sales prices and factors affecting Community prices

(94) Unit prices for Community sales to unrelated customers of

the Community industry’s own
production decreased steadily, by 42 % in total, between 2002 and the IP. Specifically, prices
declined by 25 % in 2003, by a further nine percentage points in 2004 and finally by a further
eight percentage points in the IP. The investigation showed marginal undercutting, if any, of the sales
price of the Community industry by the dumped imports. For a certain number of models, under-
cutting was larger than the average undercutting margins mentioned in recital 82.

Unit price EC market (EUR/piece)

Index (2002 = 100)

2002

2003

2004

66

100

49

75

44

66

IP

38

58

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(k) Profitability and return on investments

(95) During the period considered, the profitability of the sales in the Community of the Community
industry’s own production, expressed as a percentage of net sales, declined steadily. Profitability
declined from 24 % in 2002 to around 18 % in 2003, and to around 10 % in 2004. In the IP,
the Community industry made a loss of – 3,6 %.

2002

2003

2004

IP

Profitability of EC sales to unrelated (% of net sales)

24,0 %

18,2 %

10,1 %

ROI (profit in % of net book value of investments)

17,5 %

9,1 %

5,7 %

– 3,6 %

– 2,1 %

(96)

The return on investments (ROI), expressed as the profit as a percentage of the net book value of
investments, broadly followed the above profitability trend. It declined from around 17 % in 2002 to
– 2,1 % in the IP.

(l) Cash flow and ability to raise capital

(97)

The net cash flow from operating activities also declined during the period considered. From a level
of around 175 million EUR in 2002, it declined to around 125 million EUR in 2003, increased again
to around 141 million EUR in 2004, before dropping sharply to around – 25 million EUR in the IP.
The situation deteriorated so badly that two of the companies constituting the Community industry
were declared bankrupt during the first half of 2006, as indicated in recital 67. Only Thomson was
able to obtain funding from its mother company, and, in that way, avoided a more serious financial
situation. Ekranas and Ecimex were unable to raise capital. Looking forward, the ability of the
Community industry to raise further capital is obviously seriously hampered by the poor demand
prospects.

Cash flow (000 EUR)

175 468

124 804

140 548

– 24 626

2002

2003

2004

IP

(m) Investments

(98)

The Community industry’s annual investments in the production of the product concerned declined
steadily between 2002 and the IP. It declined by 14 % in 2003, by a further 25 percentage points in
2004 and by a further 40 percentage points in the IP.

Net investments (000 EUR)

81 445

69 807

49 426

16 996

2002

2003

2004

IP

Index (2002 = 100)

100

86

61

21

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(n) Magnitude of dumping margin

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

(o) Recovery from past dumping

(100) By means of Council Regulation (EC) No 2313/2000 (1),
measures have been imposed on imports of certain
cathode-ray colour television picture tubes originating
in India and the Republic of Korea. These measures
expired on 21 October 2005. However, these measures
concerned only one country from the four targeted in
the present proceeding, and only a part of CN code
from the five CN codes mentioned in
8540 11 11,
recital 12.
information, CN code 8540 11 11
For
covers a scope of around 20 % of the product scope
covered by the present proceeding. Given the dissimi-
larity of situations,
it is therefore difficult to draw any
conclusion on the particular issue of recovery from past
dumping.

5. Conclusion on injury

countries

from the

the Community market

(101) Between 2002 and the IP, the volume of the dumped
imports of
the product concerned originating in the
countries concerned decreased by 3 % but their share
increased by around 2,4
of
average prices of dumped
percentage points. The
imports
concerned, based on
Eurostat data, were generally lower than those of the
Community industry during the period considered.
However, during the IP, the prices of the imports from
the countries concerned did not substantially undercut
those of the Community industry. Indeed, as indicated
in recital 82, on a weighted average basis, price under-
cutting was between – 37 % and 13 % in the IP,
depending on the country and exporter concerned.
in the years
However, Eurostat data indicate
preceding the IP,
the dumped imports
from the countries concerned were substantially lower
than those of the Community industry.

the prices of

that

two of

(102) A clear deterioration of the situation of the Community
industry has been found over the period considered.
Firstly,
the three companies constituting the
Community industry were declared bankrupt during the
first half of 2006. Secondly, most of the injury indicators
the
developed negatively between 2002 and the IP:
volume of production declined by 5 %, capacity utili-
sation declined by 25 %,
employment declined by
10 %, unit sales prices declined by 42 %, profitability,

(1) OJ L 267, 20.10.2000, p. 1.

and cash flow deteriorated
return on investment
markedly and investment dropped by 79 %. The dete-
rioration of the situation of the Community industry
was extremely sudden as it occurred mainly during the
the
IP,
IP.
Community industry was still comfortably above 10 %.

the profitability of

Indeed, before

the

(103) Some

the

indicators

volume of

showed apparently positive devel-
opments between 2002 and the IP. Production capacity
increased by 28 %,
the
Community industry to the Community market rose by
16 % and the market share held by the Community
industry rose by 10 percentage points. However, these
developments could not prevent the sharp deterioration
of the financial situation of the Community industry,
which ultimately triggered the bankruptcy of
two
Community producers.

sales of

(104)

In the light of the foregoing,
it is therefore concluded
that the Community industry has suffered material injury
within the meaning of Article 3(5) of the basic Regu-
lation.

E. CAUSATION

1. Introduction

(105)

the basic
In accordance with Article 3(6) and (7) of
Regulation, the Commission examined whether dumped
imports have caused injury to the Community industry
to a degree that may be considered as material. Known
factors other than the dumped imports, which could at
the same time be causing injury to the Community
industry, were also examined to ensure that possible
injury caused by these other factors was not attributed
to the dumped imports.

2. Effects of the dumped imports

(106) During the IP,

the dumped imports from the four
countries concerned accounted for a substantial market
share of 19,4 %. Between 2002 and the IP, the volume of
the dumped imports of
the product concerned origi-
nating in the countries concerned decreased by around
3 % but their share of the Community market increased
by around 2,3 percentage points
consumption
declined even faster than the above import volume.
to observe that both the
important
However,
volume and the market
share of dumped imports
peaked in 2003, and then substantially declined up
until
the
dumped imports was 5,5 percentage points lower than
in 2003.

the IP. During the IP,

the market share of

as

is

it

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(107) The

Import prices

average prices of dumped imports

from the
countries
concerned, based on Eurostat data, were
generally lower than those of the Community industry
during the period considered and likely exerted a
also
downward pressure on them.
decreased considerably between 2002 and 2004, but
recovered in the IP by 12 percentage points, as noted
in recital 81. As the Community industry had also
the period
sales prices gradually over
lowered its
from the
imports
the prices of
considered,
countries
substantially undercut
concerned did not
those of the Community industry during the IP, on a
model
Indeed, on a weighted
average basis, price undercutting was between – 37 %
and 13 % in the IP, depending on the country and
exporter concerned. However; while there was hardly
any price undercutting,
there was in any event price
underselling by the dumped imports.

to model comparison.

the

(108) As noted in recital 102, a sharp contrast can be observed
in the situation of the Community industry between the
period 2002/2003 and the IP. It is important to note
that the deterioration of the situation of the Community
industry was extremely sudden as it occurred mainly
during the IP. Indeed, before the IP, the profitability of
the Community industry was still comfortably above
10 % and most
injury indicators were still showing
positive developments. In particular, between 2002 and
2004, production capacity increased by 23 %,
the
production volume rose by 20 %, the volume of sales
of the Community industry to the Community market
rose by 22 % and the market
share held by the
Community industry rose from around 28 % to around
32 %, at a time when the market was still growing.
During the IP, when the market suddenly contracted by
20 % in one year, the market share of the Community
industry even jumped to 38 %.

dramatically worsened during the IP. Before the IP, the
profitability of the Community industry was still above
10 %. Likewise, most injury indicators were still showing
positive developments up until the IP. Between 2002 and
the
2004, production capacity increased by 23 %,
production volume rose by 20 %, the volume of sales
of the Community industry to the Community market
rose by 22 % and the market
share held by the
Community industry rose from around 28 % to around
32 %, at a time when the market was still growing. It is
also recalled that the Community industry reached its
highest profitability in 2002 and 2003, when its
market share was the smallest and when the volume of
dumped imports was at its highest level. Community
industry’s profitability went down in the IP, when its
market share reached its peak and,
importantly, at a
time when the presence of dumped imports actually
declined in terms of both volumes and market share
(see recital 106) and when the prices of dumped
imports recovered. On the other hand, the only new
element
the Community
environment of
industry during the IP was the sharp drop in demand
by 20 %. Therefore, the absence of a clear coincidence in
time between the deterioration of the situation of the
Community industry and the effects of
the dumped
imports casts serious doubts on the correlation between
the development of
imports and the situation of the
Community industry. Therefore, it cannot be concluded
that the dumped imports had played a determining role
in the injurious situation of the Community industry.

in the

3. Effects of other

factors — Development of

consumption

(111) Several

interested parties indicated that

the drop in
demand for CPT was the main cause for the sudden
injury suffered by the Community industry.

(109) Furthermore it should be noted that

the Community
industry reached its highest profitability in 2002 and
sales prices had already decreased
2003 when its
substantially, when its market share was the smallest
and when the volume of dumped imports was at its
highest
level. Profitability went only down in the IP
when Community industry’s market share reached its
peak and at a time when the volume of dumped
imports declined and when the prices of dumped
imports increased.

(112)

(110)

In conclusion, dumped imports may have exerted a
downward pressure on the Community industry’s sales
prices throughout the period 2002 to the IP and may
have had some consequent negative impact on the
overall situation of the Community industry. However,
as noted in recitals 108 and 109, the situation of the
Community industry, which was still showing mixed
signals in the years preceding the IP, suddenly and

Indeed, as shown in recital 69, consumption of CPT
suddenly dropped in the IP, by 20 %. This drop in
consumption was the only parameter which dramatically
changed in the environment of the Community industry.
And this also coincides with a dramatic worsening of the
situation of the Community industry. The investigation
has shown that the sudden decline in demand indeed had
a negative impact on the situation of the Community
industry, as the sudden drop of Community industry’s
profitability and cash flow stems directly from the
above market contraction via a cost effect (productivity
loss in the IP as shown in recital 92 and rise in unit costs
of production) and a price effect (sudden overcapacity).
the demand for CPT had become
During the IP,
completely inelastic to prices, as shown by the fact that
the substantial drop in prices observed between 2004
and the IP did not lead to any increase in sales volume
at all. On the contrary, demand has actually dropped by
around 20 %.

L 316/34

EN

Official Journal of the European Union

16.11.2006

(113) The investigation showed that the drop in demand for
CPT coincides in time with the increasing penetration of
flat panel TV sets (Liquid Crystal Display (LCD) and
Plasma), which increased sharply from less than 1 % of
the market in 2002 to 28 % in the IP. These flat panel
TV sets compete directly with CPT and both products are
fully interchangeable. Although LCD and Plasma tech-
nologies are not completely new, it is only during the
IP that the prices for flat panel televisions have come
down significantly as prices have decreased by 44 %
between 2001 and the IP. This decrease in price of flat
panel
television has on the one hand rendered these
models more attractive to consumers, thereby reducing
the demand for TV sets with CPT, and on the other hand
has exerted a direct pressure on the selling prices of TV
sets with CPT which had to decrease in order to remain
competitive with the new, attractive, flat screen models.
As an example, flat panel TV sets accounted for 63 % of
the total value of all retail TVs bought in the UK in
2005, compared with just 37 % for 2004. Both the
result of
this investigation and information obtained
from market intelligence suggest that the sales volume
of CPT TVs peaked in the EU in 2004, and that the drop
in demand is sustained since then.

4. Conclusion on causation

(114) The data suggests that the dumped imports had exerted a
price pressure on the Community industry’s prices and
probably have also contributed to its injurious situation.
However, a more detailed analysis, in particular based on
the development of trends over the period considered did
not allow a causal link to be established as there was no
clear coincidence in time between the deterioration of the
situation of
the Community industry and the devel-
opments of the dumped imports.

(115) On the other hand and importantly, the investigation
showed that
there was indeed a clear coincidence in
time between the injurious situation of the Community
industry and the sharp and sudden decline in the demand
for CPTs in the Community. This translated into a rise of
unit production costs and a further price decrease. This
strong decline coincides perfectly with the increasing
penetration of flat panel technology.

(116)

In conclusion, it could thus not be established that the
dumped imports taken in isolation have caused material
injury. Indeed, other factors were examined pursuant to
Article 3(7) of the basic Regulation and the injury could
be significantly attributed to the effects of a sudden and
strong decline in demand and the increased availability of
flat panel technology at competitive prices.

F. PROPOSAL FOR TERMINATION WITHOUT
MEASURES

(117)

In view of the conclusions reached in recitals 105 to 114
with regard to the fact that a causal
link between the
injury suffered by the Community industry and the
dumped imports could not sufficiently be established,
the Commission considers that the present antidumping
proceeding should be terminated in accordance with
Article 9(2) of the basic Regulation,

HAS DECIDED AS FOLLOWS:

Article 1

The anti-dumping proceeding concerning imports of cathode-
including video monitor
ray colour television picture tubes,
falling within CN codes
cathode-ray tubes, of all
8540 11 11,
8540 11 19,
8540 11 91 and 8540 11 99, originating in the Peoples
Republic of China,
the Republic of Korea, Malaysia and
Thailand, is hereby terminated.

8540 11 13,

8540 11 15,

sizes,

Article 2

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

Done at Brussels, 15 November 2006.

For the Commission

Peter MANDELSON
Member of the Commission