Council Regulation (EC) No 1911/2006 of 19 December 2006 imposing a definitive anti-dumping duty on imports of solutions of urea and ammonium nitrate originating in Algeria, Belarus, Russia and Ukraine following an expiry review pursuant to Article 11(2) of Regulation (EC) No 384/96
Date: 2006-12-19
Institutions: Council of the European Union
Subjects: Algeria, Belarus, Russia, Ukraine, anti-dumping duty, chemical salt, import (EU), organic fertiliser, originating product

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Official Journal of the European Union

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COUNCIL REGULATION (EC) No 1911/2006

of 19 December 2006

imposing a definitive anti-dumping duty on imports of solutions of urea and ammonium nitrate
to
originating in Algeria, Belarus, Russia and Ukraine following an expiry review pursuant

Article 11(2) of Regulation (EC) No 384/96

THE COUNCIL OF THE EUROPEAN UNION,

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 Community (1)
(the
basic Regulation) and in particular Article 11(2) thereof,

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

Whereas:

(1)

(2)

(3)

A. PROCEDURE

1. Measures in force

imposed, by
On 23 September 2000 the Council
Regulation (EC) No 1995/2000 (2), definitive
anti-
dumping measures on imports of solutions of urea and
ammonium nitrate (UAN) originating in Algeria, Belarus,
Russia, Ukraine and Lithuania. The measures imposed on
imports of UAN originating in Lithuania lapsed after
enlargement of the European Union on 1 May 2004.
led to these measures will be
The investigation that
referred to as ‘the original investigation’.

The measures applying to these imports consisted of
for imports from one Algerian
specific duties, except
exporting producer
from which an undertaking was
accepted.

2. Request for a review

On 20 June 2005, a request
for an expiry review
pursuant to Article 11(2) of the basic Regulation, was
lodged following
a notice of
impending expiry on 17 December 2004 (3). This
request was lodged by the European Fertiliser Manufac-
(the applicant) on behalf of
turers Association (EFMA)

the publication of

(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 L 238, 22.9.2000, p. 15. Regulation as amended by Regulation

(EC) No 1675/2003 (OJ L 238, 25.9.2003, p. 4).

(3) OJ C 312, 17.12.2004, p. 5.

(4)

(5)

(6)

(7)

producers representing a major proportion, in this case
more than 50 % of the total Community production of
UAN.

The applicant alleged and provided sufficient prima facie
evidence that there is a likelihood of continuation or
recurrence of dumping and injury to the Community
industry with regard to imports of UAN originating in
Algeria, Belarus, Russia and Ukraine (the countries
concerned).

after

an expiry

determined,
that

consulting
sufficient evidence existed for

the Advisory
Having
the
Committee,
the Commission
initiation of
announced on 22 September 2005, by a notice of
initiation published in the Official Journal of the European
Union (4), the initiation of an expiry review pursuant to
Article 11(2) of the basic Regulation.

review,

3. Investigation

3.1. Investigation period

recurrence of
The investigation of continuation or
dumping covered the period from 1 July 2004 to 30
June 2005 (review investigation period or RIP). The
examination of the trends relevant for the assessment
of a likelihood of a continuation or
recurrence of
injury covered the period from 2002 to the end of the
review investigation period (period considered).

3.2. Parties concerned by the investigation

the

advised

officially

associations,
countries,

The Commission
exporting
producers, importers and users known to be concerned
the
and their
the
representatives of
and
exporting
the
complainant
Community producers of
the expiry
the initiation of
review. 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.

the

(4) OJ C 233, 22.9.2005, p. 14.

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L 365/27

(8)

(9)

All interested parties, who so requested and showed that
there were particular reasons why they should be heard,
were granted a hearing.

In view of the large number of Community producers
and of importers in the Community not related to an
exporting producer in one of the countries concerned, it
was considered appropriate,
in conformity with Article
17 of the basic Regulation, to examine whether sampling
should be used. In order to enable the Commission to
decide whether sampling would indeed be necessary and,
if so, to select a sample, the above parties were requested,
pursuant
to
make themselves known within 15 days of the initiation
of the investigation and to provide the Commission with
the information requested in the notice of initiation.

to Article 17(2) of the basic Regulation,

(10) After examination of

the information submitted, and
given the high number of Community producers which
indicated their willingness to cooperate,
it was decided
that sampling was necessary with regard to Community
that only one importer
producers. Given the
provided the information requested in the notice of
initiation and expressed its willingness
to further
cooperate with the Commission services, it was decided
that
sampling was not necessary with regard to
importers.

fact

(11) Questionnaires were

sampled
Community producers and to all known exporting
producers.

four

sent

the

to

(12)

Replies to the questionnaires were received from the four
exporting
sampled Community producers
producers in the countries concerned, as well as from
their related traders.

and six

(13) One producer

in the analogue country provided a

complete questionnaire reply.

(15)

(14)

The Commission sought and verified all the information
it deemed necessary for a determination of the likely
continuation or recurrence of dumping and resulting
injury and of the Community interest. Verification visits
were carried out at
the following
companies:

the premises of

(a) Exporting producer in Russia

— JSC Mineral and Chemical Company (Eurochem),
Moscow, Russia, and its two related manufac-
turing companies:

— PJSC Azot
Russia, and

(NAK Azot), Novomoskovsk,

— PJSC Nevinnomyssky Azot
Nevinnomyssk, Russia;

(Nevinka Azot),

(b) Related trader to Eurochem

— Eurochem Trading GmbH, Zug, Switzerland –

(Eurochem Trading);

(c) Related trader to the Ukrainian producer Stirol

— IBE Trading, New York, New York, USA;

(d) Producer in the analogue country

— Terra Industries, Sioux City, Iowa, USA;

(e) Sampled Community producers

— Achema AB, Jonava, Lithuania,

— Grande Paroisse SA, Paris, France,

— SKW

Stickstoffwerke

Piesteritz

GmbH,

Wittenberg, Germany,

— Yara SA, Brussels, Belgium and its

related
producer Yara Sluiskil BV, Sluiskil, The Neth-
erlands.

3.3. Sampling

Ten Community producers properly completed the
sampling form within the deadline and formally agreed
to cooperate further in the investigation. With regard to
the Commission
those 10 Community producers,
selected, in accordance with Article 17 of the basic Regu-
lation, a sample based on the largest
representative
volume of production and sales of UAN in the
investigated
Community which can reasonably be
within
sampled
available.
Community producers accounted for 63 % of the total
Community industry production during the RIP, whilst
the above 10 Community producers accounted for 75 %
of the total Community production during the RIP.

time

four

The

the

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(16)

In accordance with Article 17(2) of the basic Regulation,
the parties concerned were consulted on the sample
chosen and raised no objection thereto.

(20) During the RIP, exports to the Community of UAN origi-
nating in the countries concerned only took place from
Algeria. Thus, a dumping calculation to examine whether
there was likelihood of continuation of dumping was
carried out for the two cooperating Algerian exporting
producers. For the other cooperating exporting producers
in Belarus, Russia and Ukraine, the investigation focused
on the likelihood of recurrence of dumping.

B. PRODUCT CONCERNED AND LIKE PRODUCT

1. Product concerned

(17)

The product concerned is the same as in the original
i.e. a solution of urea and ammonium
investigation,
nitrate, a liquid fertiliser commonly used in agriculture,
originating in the countries concerned. It consists of a
mixture of urea, ammonium nitrate and water. The
nitrogen (N) content is the most significant ‘feature’ of
the product, and it can vary between 28 % and 32 %.
Such variation can be obtained by adding more or less
water to the solution. Most of the imported UAN was
32 % N, which is more concentrated, and therefore
their nitrogen
cheaper
content, all solutions of urea and ammonium nitrate
are considered to have the same basic physical and
chemical characteristics and therefore constitute a single
product
investigation. The
product concerned falls within CN code 3102 80 00.

to ship. However, whatever

the purpose of

this

for

2. Like product

(18) As established in the original

investigation, this review
investigation confirmed that UAN is a pure commodity
product, and its quality and basic physical characteristics
are identical whatever the country of origin. The product
concerned and the products manufactured and sold by
the exporting producers on the domestic market in the
countries concerned, as well as those manufactured and
sold by the Community producers on the Community
market and by the producer in the analogue country on
the domestic market of the analogue country have thus
been found to have the same basic physical and chemical
characteristics and essentially the same uses and are
therefore considered to be like products within the
meaning of Article 1(4) of the basic Regulation.

(21)

(22)

(23)

Algeria

General

cooperated in the

investigation. These

The only two Algerian producers of UAN, Fertalge and
two
Fertial,
producers represented the totality of exports of UAN
originating in Algeria to the Community during the
RIP, which corresponded to 177 383 tonnes.
Imports
into the Community of
the product concerned origi-
nating in Algeria represented 4,8 % of Community
consumption which was 3 694 531 tonnes in the RIP.
Imports from Algeria thus went up from 116 461 tonnes
by 52 % in comparison to the original
investigation
period.

Therefore, the examination of dumping based on the
information
cooperating
exporting producers was considered to also be represen-
tative for the country as a whole.

provided

these

two

by

Normal value

It was first established for each of the two cooperating
exporting producers whether its total domestic sales of
UAN were representative in accordance with Article 2(2)
of the basic Regulation, i.e. whether they accounted for
5 % or more of the total sales volume of the product
concerned exported to the Community. The investigation
showed that both companies only sold one type of UAN
to the Community and that this type was not sold in
representative quantities on the domestic market.

C. LIKELIHOOD OF CONTINUATION OR RECURRENCE
OF DUMPING

1. Dumping of imports during the RIP

(19)

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

(24)

Therefore,
for both exporting producers normal value
could not be based on domestic sales and had to be
constructed pursuant to Article 2(3) of the basic Regu-
lation by adding to each exporter's cost of manufacturing
of the product exported to the Community a reasonable
amount
for selling, general and administrative costs
(SG&A costs) and a reasonable profit margin.

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(29)

(30)

(31)

(25)

(26)

Regarding the cost of manufacturing, it should be noted
that energy costs, such as electricity and gas, represent a
major proportion of
the manufacturing cost and a
significant proportion of the total cost of production.
In accordance with Article 2(5) of the basic Regulation,
it was examined whether the costs associated with the
production and sales of the product under consideration
were reasonably reflected in the records of the parties
concerned.

The investigation showed no indication that the elec-
tricity would not be reasonably reflected in the records
of the exporting producers. In this context, it is inter alia
noted that
electricity prices paid by the Algerian
producers during the RIP were in line with international
market prices, when compared to other countries, such
as Canada and Norway. However, the same could not be
said with regard to gas prices.

that domestic gas prices

(27) As concerns gas supplies, in fact, it was established on
the basis of data published by internationally recognised
sources specialised in energy markets, that the price paid
by the Algerian producer was less than one fifth of the
export price of natural gas from Algeria. In addition, all
available data indicates
in
Algeria were regulated prices, which are far below
market prices paid for natural gas, for example in the
Japan and the EU. These four markets
USA, Canada,
account
gas
total of 46 % of worldwide
a
consumption, and the prevailing domestic price levels
in these four markets appear to reasonably reflect costs.
Moreover,
the price of gas paid by the companies
concerned was significantly lower than the gas price
paid by the Community producers.

for

(28)

it was considered that the gas
In view of the above,
prices paid in Algeria during the review investigation
period could not reasonably reflect the costs associated
with the production and distribution of gas. Therefore, as
provided for in Article 2(5) of the basic Regulation, the
gas costs borne by one cooperating exporting producer,
Fertial, were adjusted on the basis of information from
other
representative markets. The adjusted price was
based on the average price during the RIP of Algerian
liquefied natural gas (LNG) when sold for export at the
French border, net of sea freight and liquefaction costs,
since this was considered to be the most appropriate
basis, as this public information refers exclusively to
gas of Algerian origin. France, being both the largest
market for Algerian gas and having prices reasonably
reflecting costs, can be considered a representative
market within the meaning of Article 2(5) of the basic
Regulation. The other cooperating company, Fertalge, did
not use natural gas as a raw material, since it produces
UAN from ammonium nitrate (AN), that is produced

locally, and urea. Since the cost of AN produced locally
reflected Algerian domestic gas price mentioned in recital
27,
the costs of AN borne by this company were
adjusted accordingly.

The manufacturing costs provided by the cooperating
exporting producers were therefore recalculated in order
to take account of the adjusted gas prices, using equally
the prices of gas when sold at the French border, net of
sea freight and liquefaction costs. To the manufacturing
cost so recalculated, a reasonable amount for SG&A and
a reasonable profit margin were added,
in accordance
with Article 2(3) and Article 2(6) of the basic Regulation.

either,

representative domestic

SG&A costs and profit could not be established on the
basis of the chapeau of Article 2(6) of the basic Regu-
lation because the two cooperating companies did not
have
the product
sales of
concerned in the ordinary course of
trade. Article
the basic Regulation could not be applied,
2(6)(a) of
since the two cooperating producers are the only two
producers of UAN in Algeria. Article 2(6)(b) was not
applicable
for
products belonging to the same general category of
goods would also need to be adjusted in respect of gas
costs, for the reasons indicated in recital 28 above. As it
was found to be impossible to establish the magnitude of
the necessary adjustment for all products belonging to
the same general category of goods sold domestically, it
was equally impossible to establish the profit margins
such adjustment. Therefore, SG&A costs and
after
profit were established pursuant
to Article 2(6)(c) of
the basic Regulation.

the manufacturing cost

since

In accordance with Article 2(6)(c) of the basic Regulation,
the SG&A costs and profit were determined on the basis
of a reasonable method. As the Algerian domestic market
of products of the same general category is extremely
small, information had to be obtained from other repre-
sentative markets. In this respect, consideration was given
to publicly available information relating to major
companies operating in the nitrogen fertilisers business
sector. It was found that the corresponding data from
North American (USA and Canada) producers would be
the most appropriate for the purpose of the investigation,
given the large availability of reliable and complete public
financial
in this
information from listed companies
the North American
region of
market showed a significant volume of domestic sales
and a considerable level of competition from both
domestic
and foreign companies. Therefore, SG&A
costs and profit were established on the basis of the
from three
weighted average SG&A costs and profit

the world. Moreover,

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North American producers, which were found to be
amongst the largest companies in the fertilisers’ sector,
with regard to their north American sales of the same
general category of products (nitrogen fertilisers). These
three producers were considered to be representative of
the nitrogen fertilisers’ business (on average over 80 % of
the turnover of the company/business segment) and their
SG&A costs and profit as representative of the same type
of costs normally incurred by companies operating
successfully in that business segment. The percentage
for SG&A costs was 6,9 % of turnover. The calculated
average
turnover.
Furthermore, there is no indication suggesting that the
amount
the profit
normally realised by Algerian producers on sales of
products of the same general category in the Algerian
market.

so established exceeds

profit margin was

9,1 % of

for profit

2. Development of

imports should measures be

repealed

2.1. Algeria

(36)

the

totality of

imports of

two Algerian cooperating exporting producers
The
represent
the product
concerned from this country into the Community.
Therefore,
it would be
for
likely that dumping continues
Algeria be repealed was based on the information
provided by these two cooperating exporting producers.

the examination of whether

should measures

S p a r e c a p a c i t y

(37) Algerian cooperating producers managed to double their
production capacity while they increased their production
by around 20 % during the period considered. Therefore,
their spare capacity has significantly increased from less
than 100 000 tonnes to 300 000 to 350 000 tonnes.

(38)

Since the Algerian domestic market is insignificant and
this is not likely to change in the future, any increase in
production will be export-oriented. By activating their
spare capacity, the two cooperating exporting producers
could supply 10 % to 20 % of
the Community
consumption.

(39) Given that dumping continued during the RIP and on the
basis of the spare capacity that the Algerian cooperating
producers have built up, it is likely that the volume of
Algerian exports into the Community will
increase at
dumped prices should measures lapse.

(40)

In the light of the above, there is likelihood of conti-
nuation of dumped exports to the Community should
measures be repealed.

Export price

(32)

In accordance with Article 2(8) of the basic Regulation,
the export price was established on the basis of the price
actually paid or payable for the product concerned when
sold for export to the Community.

Comparison

(33)

The normal value and export price were compared on an
ex-works basis. 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 price and price compar-
ability in accordance with Article 2(10) of
the basic
Regulation. Accordingly, adjustments were made for
loading and ancillary
differences in transport, handling,
costs, where
and supported by verified
evidence.

applicable

Dumping margin

(34)

The dumping margin for each exporting producer was
established on the basis of a comparison of a weighted
average normal value with a weighted average export
price, in accordance with Article 2(11) and (12) of the
basic Regulation.

C o m p a r i s o n
n o r m a l v a l u e
l e v e l

i n t h e C o m m u n i t y

b e t w e e n
A l g e r i a n
t h e
a n d t h e p r e v a i l i n g p r i c e

(35)

The investigation showed that dumping took place
during the RIP even at a higher
than in the
investigation. The dumping margins expressed
original
as a percentage of
the cif Community frontier price,
are in the range of 50 % to 60 %.

level

(41)

The normal value established for both companies signifi-
cantly exceeded EU market prices during the RIP.
It
cannot be excluded that Algerian exporting producers
would continue to sell to the Community at dumped
prices, whether they have to pay duties or not.

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2.2. Relationship between the constructed normal value in
Belarus, Russia and Ukraine and export prices to third
countries

markets are small with a limited number of manufac-
turers, contrary to the USA.

2.2.1. B e l a r u s a n d U k r a i n e : d o m e s t i c s a l e s
a n a l o g u e

b a s e d

t h e

o n

p r i c e s
c o u n t r y

In this respect

(42) A comparison of domestic sales prices of UAN in Belarus
and Ukraine and export prices to third countries was
carried out.
it should be noted that
since Belarus
is considered a non-market economy
country and Ukraine was not yet considered a market
the
the time of
economy country at
request for the expiry review (1), the normal value for
these two countries had to be determined on the basis
of data obtained from producers in a market economy
third country, in accordance with Article 2(7) of the basic
the USA was
Regulation.
envisaged as an appropriate analogue country, being an
open competitive market, where producers face a consid-
erable level of competition from foreign imports.

In the notice of

the lodging of

initiation,

(43) All

interested parties were given the opportunity to

comment on the choice of the analogue country.

(44)

subject

it should be pointed out

to the same investigation.

The European Fertilisers Importers Association, EFIA,
proposed Algeria or Russia as better options, given
to the main raw material,
their privileged access
namely gas, and since they were market economy
countries
In this
respect,
that Article 2(7)(a)
requires, before any further considerations, an ‘appro-
priate’ market economy third country. While access to
raw materials is an important factor as regards the choice
of the analogue country, it should also be noted that the
existence of dual pricing in relation to gas in these two
these two countries an inap-
countries made in fact
propriate choice. Indeed, the gas prices charged in these
two countries to their domestic customers do not reflect
the market value.

(45)

alleged,
although without
Some
interested parties
substantiating their claim,
that Russian and Algerian
production processes are more similar to the ones in
Belarus and Ukraine. Algeria was also suggested as
having a more similar level of production to Ukraine.
In this respect, it must be stressed that Belarus, Ukraine
and the USA have all fully vertically integrated producers,
which is definitely not the case for Algeria.

(46) A Ukrainian cooperating producer proposed Bulgaria or
Romania rather than the USA. However, its proposal was
not
factor
their domestic
against Bulgaria or Romania is

In addition, an important

substantiated.

that

(1) Regulation (EC) No 2117/2005, Article 2.

(47)

Therefore, the investigation confirmed that the USA was
an appropriate analogue country. Various producers and
producers’ associations in the USA were contacted and
invited to cooperate through the completion of a ques-
tionnaire. One producer in the USA fully cooperated in
the investigation. Consequently, calculations were based
on the verified information from the sole USA coop-
erating producer, which provided a complete ques-
tionnaire reply.

2.2.2. B e l a r u s

Preliminary remarks

(48)

The sole cooperating producer in Belarus was the only
exporting producer from that country, but it had no
export sales to the Community in the RIP.

(49)

Since there were no exports to the Community for a
representative dumping finding in the RIP, and in order
to establish whether dumping would be likely to recur
should measures be repealed, the pricing behaviour of the
its sole
cooperating exporting producer to the USA,
export market, and its production capacity and stocks
were examined. The analysis was based on the infor-
mation provided by the cooperating exporting producer
mentioned in recital 48.

Comparison

investigation established that overall

(50) Data from the cooperating exporting producer showed
that export prices to third countries (USA) were lower
than the constructed normal value for Belarus. In fact,
this price
the
difference ranged in the RIP between 10 % and 15 %.
recurrence of
This may
a
dumping on exports
should
measures be repealed. Stocks and production capacity,
as well as a comparison of these export prices with the
prevailing price level
in the Community, are examined
below.

likelihood of
to the Community

indicate

2.2.3. U k r a i n e

Preliminary remarks

(51)

Two exporting producers cooperated in the investigation,
but none of them had export sales to the Community in
the RIP. There are no indications that there were more
exporting producers in Ukraine.

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(52)

(53)

Since there were no exports to the Community for a
representative dumping finding in the RIP, and in order
to establish whether dumping would be likely to recur
should measures be repealed, the pricing behaviour of the
its sole
cooperating exporting producer to the USA,
export market, and its production capacity and stocks
were examined. The analysis was based on the infor-
mation provided by the two cooperating exporting
producer mentioned in recital 51.

(57)

imports

into the USA of

The two cooperating exporting producers represented
48 % of
the product
concerned originating in Ukraine during the RIP. The
remainder of
the imports in the USA originating in
Ukraine were also produced by one of the cooperating
producers, but exported by an unrelated Ukrainian
company, which does not produce UAN.

Comparison

(58)

(54) Data from the cooperating exporting producers showed
that export prices to third countries were lower than the
constructed normal value for Ukraine. In fact, the inves-
tigation established that overall
this price difference
ranged in the RIP between 20 % and 30 %. This may
recurrence of dumping on
indicate a likelihood of
exports
be
should measures
repealed. Stocks and production capacity, as well as a
comparison of these export prices with the prevailing
price level in the Community, are examined below.

to the Community

2.2.4. R u s s i a

Preliminary remarks

(55)

Two exporting producers belonging to the same group of
companies cooperated in the investigation, but no
exporting producer had export sales to the Community
in the RIP.

(59)

(56)

It is known that there was one producer in Russia in the
RIP which did not cooperate in the investigation. For
those non-cooperating exporting producer(s), the infor-
mation available from Eurostat and other sources was
analysed. On that basis it was found that exports of
UAN to the Community from other than the cooperating
producers were also non-existent. However, no reliable
information
and
production volumes, stocks and sales was available for
the non-cooperating company. In this respect, and in the
it was
absence of any indication of

the contrary,

production

capacity

the

to

as

that

the non-cooperating
considered
company would be in line with those established for
cooperating companies.

findings

for

Since there were no exports to the Community for a
representative dumping finding in the RIP, and in order
to establish whether dumping would be likely to recur
should the measures be repealed, the pricing behaviour of
the cooperating exporting producers to other export
markets and their production capacity and stocks were
examined. The analysis was based on the information
provided by
exporting producers
mentioned in recital 55.

cooperating

the

Comparison

It was examined whether the costs associated with the
production and sales of the product under consideration
were reasonably reflected in the records of the parties
it was found that the
concerned. As regards gas costs,
domestic gas price paid by the Russian producers was
around one fifth of the export price of natural gas from
Russia.
In this regard, all available data indicates that
domestic gas prices in Russia were regulated prices,
which are far below market prices paid in unregulated
markets for natural gas. Therefore, as provided for in
Article 2(5) of
the gas costs
the basic Regulation,
borne by the Russian producers were adjusted on the
basis of information from other representative markets.
The adjusted price was based on the average price of
Russian gas when sold for export at the German/Czech
border (Waidhaus), net of
transport costs. Waidhaus,
being the main hub for Russian gas sales to the EU,
which is both the largest market for Russian gas and
has prices reasonably reflecting costs, can be considered
a representative market within the meaning of Article
2(5) of the basic Regulation.

The construction of the normal value was done on the
basis of the manufacturing costs of the product type
exported,
cost
adjustment
mentioned in recital 58, plus a reasonable amount
SG&A costs and for profits, in accordance with Article
2(3) and Article 2(6) of the basic Regulation.

after

gas

the

the

for

(60) As for Algeria, SG&A costs and profit could not be
established on the basis of the chapeau of Article 2(6),
first sentence, of the basic Regulation because the related

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since the manufacturing costs

manufacturers did not have representative domestic sales
of the product concerned in the ordinary course of trade.
the basic Regulation could not be
Article 2(6)(a) of
applied,
since there are only these two producers
to the investigation. Article 2(6)(b) was not
subject
applicable either,
for
products belonging to the same general category of
goods would also need to be adjusted in respect of gas
costs, for the reasons indicated in recital 58 above. As it
was found to be impossible to establish the magnitude of
the necessary adjustment for all products belonging to
the same general category of goods sold domestically, it
is equally impossible to establish the profit margins after
such adjustment. Therefore, SG&A costs and profit were
established pursuant to Article 2(6)(c) of the basic Regu-
lation.

(61) As in the case of Algeria and for the same reasons as
explained in recital 31, SG&A costs and profit were
established on the basis of the weighted average SG&A
costs and profit from the same three North American
producers.
for
profit so established did not exceed the profit realised
by the Russian producers on sales of products of the
same general category on their domestic market.

It should be noted that

the amount

(65)

(66)

(62)

It was found that the export sales of the two cooperating
producers were made on the basis of an agent agreement
through two related traders, one located in Switzerland
and the other one on the British Virgin Islands. The latter
ceased to operate at the beginning of 2005. The export
price was established on the basis of export prices
actually paid or payable
independent
customer in the USA, their major export market.

to the

first

(63) Data from the two related traders showed that export
prices to third countries were lower than the constructed
normal value in Russia. In fact, the investigation estab-
lished that overall this price difference ranged in the RIP
between 2 % and 6 %. This may indicate a likelihood of
recurrence of dumping on exports to the Community
should measures be repealed.

2.3. Spare capacity in Belarus, Russia and Ukraine

(64)

The possible effects of existing spare capacity were also
examined. Neither Russia nor Ukraine has a relevant
domestic market for UAN. On the contrary, Belarus is

considered to have a considerable domestic market for
this product.

The Belarusian sole producer managed to increase its
production by 14 % during the period considered, and
was producing close to full capacity during the RIP. Its
production capacity during the same period remained
its production domes-
stable.
tically,
It
therefore appears that this producer does not have any
spare production capacity readily available.

It sold around 60 % of
the remainder being exported to the USA.

the

according

increased its
The Russian sole cooperating producer
Its
production by 78 % during the period considered.
production capacity during the same period remained
stable. However,
information
to
submitted,
this producer still has significant available
capacity of around 600 000 to 700 000 tonnes to
should
increase its production of UAN, and could,
measures be
capacity to
increase exports to the Community market. Investment
made by the company during the period considered
in production
suggests a potential
spare
It
capacity.
capacity is at
the known 600 000 to 700 000
tonnes, which constitutes around 20 % of Community
consumption. Exports to third countries grew by 79 %
during the period considered.

is estimated that Russian overall

repealed, use

increase

further

spare

least

this

(67) At the same time, the domestic sales of the sole coop-
erating Russian producer remained at a low level, repre-
senting on average less than 5 % of total sales. Since the
in
domestic market
production, any increase in production is likely to be
exported.

increase

cannot

absorb

the

(68) As to Ukraine, the two cooperating producers managed
to increase production twelvefold during the period
considered. Production capacity during the same period
increased almost fivefold. In addition, they have consid-
to the
erable
spare
should
Community market
measures be repealed.
is estimated that Ukrainian
overall spare capacity amounts to 700 000 to 800 000
tonnes, which constitutes around 20 % of Community
consumption. Exports to third countries increased by
eightfold during the period considered.

to increase
in significant

exports
volumes

capacity

It

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(69) Ukrainian domestic sales remained at a low level during
the period considered, representing on average less than
2 % of total sales. It should be noted that growth of the
domestic market
in
production and therefore any increase in production is
likely to be exported.

increase

cannot

absorb

the

to other markets would have considerable transport cost
advantages when exporting to the Community instead,
given its proximity to the Community border compared
to other potential export markets for the Belarusian
producer such as the USA, Argentina or Australia.

(70) On the basis of the above, it can be concluded that the
cooperating producers, with the exception of Belarus,
have substantial spare capacity to increase their exports
to the Community market should measures be repealed.

2.4. Relationship between export prices to third countries and

the prevailing price level in the Community

(75)

In the light of the above, there is likelihood that the
Belarusian producer would redirect significant parts of
its sales to the Community at dumped prices, should
measures be repealed, as there are strong economic
incentives.

(71)

export price

than the average

It should be noted that the generally prevailing price level
of the Community producers in the Community was
lower
the
exporting producers to third countries during the RIP,
especially to the USA. This is explained by the fact that
the
gas prices, which constitute more than 50 % of
manufacturing costs, and thus UAN prices, were higher
in the USA than in Europe, and that accordingly UAN
traded at a higher price in the USA.

level of

(72)

It should be noted that
the export prices from the
countries concerned to the USA were on average lower
than the respective normal values, even though the
prevailing price level
than
prices in the Community. It can therefore be concluded
that any sales to the EC market would most probably be
at dumped prices.

in the USA was higher

2.5. Incentive

to shift

sales

from other markets

to the

Community

(73) With regard to Belarus,

there is a rapidly growing
domestic market on which the sole producer sells two
thirds of its production. Given that the domestic price is
less than a half of the prevailing price in the Community
likelihood that a rational
during the RIP,
to
economic decision leads
redirect
significant quantities currently sold on the
domestic market to the Community market at dumped
prices.

the Belarusian producer

there is

(74)

In this respect, it should also be noted that the Belarusian
producer who is currently exporting the remaining third

C o n c l u s i o n s
b e h a v i o u r
U k r a i n e

o n

f o r

t h e
B e l a r u s ,

l i k e l y

e x p o r t
a n d

R u s s i a

(76) As already explained in recital 20,

in the absence of
exports to the Community during the RIP by Belarus,
Russia and Ukraine, dumping from these countries
could not be established in respect of exports to the
the
Community. However, as explained in section 2,
investigation has shown that on the basis of calculations
carried out by using data relating to actual exports from
these countries to their major export market, the USA,
that there was a likelihood of recurrence of dumping.

3. Conclusion on the likelihood of continuation or

recurrence of dumping

likelihood that

(77) On the basis of the analysis carried out in sections 1 to
5, it is concluded that should measures be repealed, there
is
additional production would be
exported to the Community, or sales currently exported
to countries outside the Community or sold on the
domestic markets would be redirected towards
the
Community market in significant quantities. It is likely
that these exports to the Community will be made at
to regain lost market
dumped prices,
be
shares
can therefore
It
concluded that, should measures be repealed,
future
exports to the Community would be made in increased
it should be
quantities at dumped prices. Moreover,
noted that overseas markets are subject to higher trans-
portation costs than the Community market, namely
when considering sales from neighbouring countries,
such as Belarus and Ukraine to Eastern Europe or
Algeria to Southern Europe.

in particular
in the Community.

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(78) As regards imports into the Community originating in
Algeria, since they are still made at dumped prices, and
also on the above analysis of spare capacities and the
comparison of price levels, dumping from Algeria is
the
likely to continue
Community was the only export market
for Algeria
during the RIP,
is highly likely that Algerian
exporters would direct their increased export volumes
mainly to this market.

future. Given that

in the

it

(79)

In the light of the above,
it is concluded that there is
likelihood of continuation (from Algeria) and recurrence
(from Russia, Belarus and Ukraine) of dumping should
measures be repealed.

D. INJURY

1. Definition of the Community industry

(80) Within the Community, the product concerned is manu-
factured by 12 producers whose output constitutes the
total Community production within the meaning of
Article 4(1) of the basic Regulation.

(81)

It should be noted that as compared to the original
the ‘Hydro Agri’ companies have been
investigation,
renamed ‘Yara’. Five companies have become part of
the Community industry due to the enlargement of the
European Union in 2004.

(82) Out of

the 12 Community producers, 10 companies
cooperated with the investigation out of which nine
were mentioned in the review request. The remaining
two producers (other Community producers) remained
silent. Accordingly, the following 10 producers agreed
to cooperate:

— Achema AB (Lithuania),

(85)

— AMI Agrolinz Melamine

International GmbH

(Austria),

— DSM Agro (The Netherlands),

— Duslo AS (Slovakia),

— Fertiberia SA (Spain),

— Grande Paroisse SA (France),

— Lovochemie AS (Czech Republic),

— Nitrogénművek Rt (Hungary),

— SKW Stickstoffwerke Piesteritz GmbH (Germany),

— Yara (The Netherlands, Germany, Italy and the United

Kingdom).

(83) As these 10 Community producers accounted for 75 %
of the total Community production during the RIP, it is
therefore considered that
the above 10 Community
producers account for a major proportion of the total
Community production of the like product. They 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’.

(84) As indicated under recitals 10, 15 and 16, a sample
consisting of four companies was selected. All sampled
Community producers cooperated and sent questionnaire
replies within the deadlines. In addition, the remaining
complainant producers and producers supporting the
investigation duly provided certain general data for the
injury analysis.

2. Situation on the Community market

2.1. Consumption in the Community market

The apparent Community consumption was established
on the basis of the sales volumes of the Community
industry on the Community market, the sales volumes
of the other Community producers on the Community
market, and Eurostat data for all EU imports. Given the
enlargement of the European Union in 2004, for the
sake of clarity and consistency of
the
consumption was established on the basis of the EU-25
market throughout the period considered.

the analysis,

(86)

Between 2002 and the RIP, Community consumption increased moderately by 8 %. The increase
recorded in 2004 is mainly attributed to the implementation of the common agricultural policy in
the new Members States after their accession to the European Union. From 2004, farmers in the new
Member States had additional funding available to them which led to increased usage of fertilisers.

Total EC consumption in tonnes

3 425 381

3 579 487

3 740 087

3 694 532

Index (2002 = 100)

100

104

109

108

2002

2003

2004

RIP

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2.2. Imports from the countries concerned

2.2.1. C u m u l a t i o n

(87)

In the original investigation imports of the product concerned originating in Algeria, Belarus, Russia
and Ukraine were assessed cumulatively in accordance with Article 3(4) of the basic Regulation. It
was examined whether a cumulative assessment was also appropriate in the current investigation.

(88)

In this respect, it was found that there were no imports of the product concerned from Ukraine
throughout the period considered and no imports from Belarus and Russia in 2004 and the RIP.
Therefore, the conditions set out in Article 3(4) of the basic Regulation to assess cumulatively
imports of the product concerned from these countries with imports of the product concerned
from Algeria were not fulfilled.

(89)

In the light of the above, it was considered that all four countries should be examined separately.

2.2.2. V o l u m e , m a r k e t

s h a r e

a n d p r i c e s o f

i m p o r t s

f r o m e a c h o f

t h e

c o u n t r i e s c o n c e r n e d

(90) With respect to the three countries concerned with exports to the Community during the period
considered, the volumes, market shares and average prices per country developed as set out below.
The following quantity and price trends are based on Eurostat.

2002

2003

2004

RIP

Volume of imports from Algeria (tonnes)

97 378

239 348

219 680

177 383

Market share

2,8 %

6,7 %

5,9 %

4,8 %

Prices of imports from Algeria (EUR/tonne)

96

99

117

131

Volume of imports from Belarus (tonnes)

101 479

44 438

Market share

3,0 %

1,2 %

Prices of imports from Belarus (EUR/tonne)

74

64

Volume of imports from Russia (tonnes)

81 901

81 809

Market share

2,4 %

2,3 %

Prices of imports from Russia (EUR/tonne)

64

70

—

—

—

—

—

—

—

—

—

—

—

—

(91)

(92)

The volume of imports from Algeria, although decreasing slightly as from 2003 onwards, gained a
further 2 percentage points of market share during the period considered, whereas the prices evolved
positively from 96 to 131 EUR/tonne. Regarding Belarus and Russia, their respective import volumes
decreased substantially and completely ceased from 2004 onwards.

The investigation showed that imports from Algeria were not undercutting the Community industry
prices during the RIP. As for the remaining countries, in the absence of imports during the RIP, a
comparison of their export prices to third countries during the RIP with the Community industry
prices on the Community market has equally shown no undercutting.

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2.3. Imports from other countries

(93)

The volume of imports from other third countries during the period considered are shown in the
table below. The following quantity and price trends are also based on Eurostat.

2002

2003

2004

RIP

Volume of imports from Romania (tonnes)

69 733

79 137

257 113

142 288

Market share

Prices of imports from Romania (EUR/tonne)

2 %

94

Volume of imports from USA (tonnes)

26 024

2,2 %

6,9 %

3,9 %

102

57

112

20

123

6

Market share

0,7 %

0,0 %

0,0 %

0,0 %

Prices of imports from USA (EUR/tonne)

86

289 (*)

1 101 (*)

1 664 (*)

(*) Given the given the negligible quantities, these prices cannot be considered reliable.

(94)

(95)

In the case of Romania, a substantial increase of imports was recorded in 2004 gaining a market
share of 6,9 %, which nevertheless dropped down to 3,9 % during the RIP in spite of favourable
Community market conditions. This development should be seen against the background of the
sharp increase of Romanian exports to the USA market, which, in terms of volume, represented more
than three times the volumes of Romanian exports to the Community during the RIP. As regards the
prices, they have increased steadily throughout the period considered and were consistently higher
than the sampled Community industry’s prices in 2004 and the RIP. On this basis,
it is not
injury to the
considered that Romanian exporting producers can constitute a threat of material
Community industry. Import from the USA, which only had a market share of 0,7 % in 2002,
decreased dramatically to 6 tonnes in the RIP. This trend reflects the fact that sales prices in the USA
were higher than sales prices to the EC until the end of the RIP so that there was no incentive for
USA producers to export to the EC.

The European Fertiliser Import Association (EFIA) argued that since the Romanian exports to the
Community market do not constitute a threat of material injury although their increase in volume is
higher than that of Algerian exports and their prices lower than those charged by Algerian exporters,
equally the Algerian exports should not constitute a threat of material injury. In this respect, it should
be noted that indeed for Algeria, as indicated in recital 92, no undercutting was found and Algeria
was not
injury to the Community industry during the period
considered. However, the analysis for that country developed in section 4 showed that there is a
likelihood of recurrence of injury. In contrast, as anti-dumping duties were not applicable to imports
of UAN originating in Romania, this country was not subject to an injury recurrence test pursuant to
Article 11(2) of the basic Regulation. On this basis, the argument was rejected.

found to have caused material

3. Economic situation of the Community industry

(96)

Pursuant to Article 3(5) of the basic Regulation, the Commission examined all relevant economic
factors and indices having a bearing on the state of the Community industry.

3.1. Preliminary remarks

(97)

In view of the fact that sampling had been used with regard to the Community industry, the injury
has been assessed both on the basis of information collected at the level of the entire Community
industry (C.I. in the enclosed tables) and on the basis of information collected at the level of the
sampled Community producers (S.P. in the enclosed tables).

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(98) Where recourse is made to sampling, in accordance with established practice, certain injury indicators
(production, production capacity, stocks, sales, market share, growth and employment) are analysed
for the Community industry as a whole, while those injury indicators relating to the performances of
investments, return on
individual companies,
i.e. prices, costs of production, profitability, wages,
information
investment, cash flow and ability to raise capital are examined on the basis of
collected at the level of the sampled Community producers.

3.2. Data relating to the Community industry as a whole

(a) P r o d u c t i o n

(99)

The Community industry’s production increased by 5 % between 2002 and the RIP, i.e. from a level
of around 2,8 million tonnes in 2002 to a level of around 3 million tonnes in the RIP. Specifically,
production decreased by 3 % in 2003, before increasing by 2 percentage points in 2004 and by a
further 7 percentage points in the RIP.

2002

2003

2004

RIP

C.I. production (tonnes)

2 843 529

2 768 258

2 823 972

3 003 918

Index (2002 = 100)

100

97

99

106

Source: Complainants, sampling questionnaire replies and verified questionnaire replies.

(b) C a p a c i t y a n d c a p a c i t y u t i l i s a t i o n r a t e s

(100) Production capacity remained practically stable throughout the period considered. In view of the
growth in production, the resulting capacity utilisation increased, from a level of 57 % in 2002 to a
level of 60 % in the RIP. As already noted in the original investigation, capacity utilisation for this
type of production and industry can be affected by the production of other products which can be
produced on the same production equipment.

C.I. production capacity (tonnes)

4 984 375

4 944 575

4 941 975

4 955 075

2002

2003

2004

RIP

Index (2002 = 100)

C.I. capacity utilisation

Index (2002 = 100)

(c) S t o c k s

100

57 %

100

99

56 %

98

99

57 %

100

99

61 %

106

(101) The level of closing stocks of the Community industry increased progressively throughout the period
considered. At the end of the RIP (30 June 2005), the stock level was relatively low but this is due to
the fact that for this type of product, always, the stock levels are much lower in summer than in
winter as the sales’ peak is in spring and early summer. By the end of 2004, the level of stocks was
13 % higher than by the end of 2002.

C.I. closing stocks (tonnes)

276 689

291 085

313 770

159 926

Index (2002 = 100)

100

105

113

58

2002

2003

2004

RIP

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(d) S a l e s v o l u m e

(102) The sales by the Community industry on the Community market decreased by 3 % between 2002
and the RIP. This development is opposite to the evolution of consumption on the Community
increase in
market, which increased by 8 % during the same period (see recital 86). The overall
production volumes is explained by the strong export performance of the Community industry
during the same period. The table below shows the export volumes of the sampled Community
producers whose main destination was the USA market.

2002

2003

2004

RIP

C.I. EC sales volume (tonnes)

2 800 226

2 641 000

2 604 215

2 722 174

Index (2002 = 100)

100

94

93

97

S.P. sales volume to third countries (tonnes)

176 269

194 543

228 937

328 796

Index (2002 = 100)

100

110

130

187

(e) M a r k e t s h a r e

(103) The market share held by the Community industry decreased substantially between 2002 and the
RIP. Specifically, the Community industry lost 8 percentage points of market share during the period
considered, while the Algerian producers increased their market share from 2,8 % to 4,8 % during the
same period.

Market share of Community industry

81,7 %

73,8 %

69,6 %

73,7 %

Index (2002 = 100)

100

90

85

90

2002

2003

2004

RIP

(f) G r o w t h

(104) The Community industry lost a significant part of its market share, to the benefit of the Algerian,
Romanian and other Community producers who gained market share during the same period.

(105) The loss of market share can also be attributed to the rational decision made by the Community
industry to increase its exports to the USA market in order to benefit from the much higher UAN
prices prevailing on that market. However,
its large spare production capacity, the
Community industry could not benefit from the growth of the Community market which was
observed during the period considered.

in view of

(g) E m p l o y m e n t

(106) The level of employment of the Community industry increased by 5 % between 2002 and the RIP.
This relatively small increase should be mainly attributed to the improved export performance of the
Community industry.

C.I. employment product concerned

Index (2002 = 100)

2002

827

100

2003

819

99

2004

790

96

RIP

867

105

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(h) P r o d u c t i v i t y

(107) Productivity of the Community industry’s workforce, measured as output per person employed per

year, remained fairly stable between 2002 and the RIP.

C.I. productivity (tonnes per employee)

3 437

3 380

3 573

3 463

Index (2002 = 100)

100

98

104

101

2002

2003

2004

RIP

(i) M a g n i t u d e o f d u m p i n g m a r g i n

(108) As concerns the impact on the Community industry of the magnitude of the actual margin of
dumping, given the volume of
the
Community market during the period considered), this impact cannot be considered to be negligible,
especially in a highly volatile market in terms of prices like the one of the product concerned. No
conclusion can be drawn with regard to Belarus, Russia and Ukraine as imports from these countries
ceased in 2003.

the imports from Algeria (accounting for up to 6,7 % of

3.3. Data relating to the sampled Community producers

(a) S a l e s p r i c e s a n d f a c t o r s a f f e c t i n g d o m e s t i c p r i c e s

(109) The sampled Community industry producers’ average net sales price increased substantially in 2004
and the RIP reflecting thus the prevailing favourable international market conditions of the product
concerned during the same period. This growing trend should be seen in conjunction with the similar
evolution of the cost of the principal raw material, i.e. gas, as the below table illustrates.

S.P. unit price EC market (EUR/tonne)

Index (2002 = 100)

S.P. gas price/MBTU (indexed)

2002

2003

2004

85

100

100

89

105

107

109

128

111

RIP

114

134

126

(b) W a g e s

(110) Between 2002 and the RIP, the average wage per employee increased by 9 %, as the table below

shows.

S.P. annual labour cost per employee (000 EUR)

Index (2002 = 100)

2002

23,4

100

2003

25,4

108

2004

27,0

115

RIP

25,6

109

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(c) I n v e s t m e n t s

(111) The annual flow of investments in the product concerned made by the four sampled producers
developed positively during the period considered. These investments referred mainly to replacement
of old machines. This shows the efforts of the Community industry to continuously improve its
productivity and competitiveness. However, the results are not apparent in the evolution of produc-
tivity which remained rather stable (see recital 107) during the same period reflecting thus the
difficulties of the Community industry to boost its production output.

S.P. net investments (000 EUR)

12 512

20 087

12 611

17 047

Index (2002 = 100)

100

161

101

136

2002

2003

2004

RIP

(d) P r o f i t a b i l i t y a n d r e t u r n o n i n v e s t m e n t s

(112) Profitability of the sampled producers shows a gradual improvement notably since 2003 and reached
the level of 13,8 % during the RIP. At the end of the period considered the profitability reached its
peak on this price-cyclical market. Indeed, numerous factors, including external ones, can affect world
markets prices for UAN and other nitrogenous fertilisers. Such factors can result in either additional
supply or reduced demand for these products, thereby influencing product pricing. During the period
considered, due to tight supply the world market prices moved upwards. In 2002 and 2003, the
profit levels found were, however, moderate and below the levels considered reasonable by the
Community industry in view of the fact that this industry is highly capital-intensive. The return
on investments (ROI), expressed as the profit in percent of the net book value of investments,
broadly followed the above profitability trend over the whole period considered.

S.P. profitability of EC sales to unrelated customers
(% of net sales)

2002

8,1 %

2003

6,0 %

2004

RIP

12,3 %

13,8 %

Index (2002 = 100)

100

74

S.P. ROI
investment)

(profit

in % of net book value of

22 %

24 %

151

50 %

170

58 %

Index (2002 = 100)

100

111

229

265

(e) C a s h f l o w a n d a b i l i t y t o r a i s e c a p i t a l

(113) Cash flow has increased significantly during the period considered. This development is in line with

the development of the overall profitability during the period considered.

S.P. cash flow (000 EUR)

23 532

19 625

39 767

50 823

Index (2002 = 100)

100

83

169

216

2002

2003

2004

RIP

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(114) The

any

reveal

investigation did not

difficulties
encountered by the sampled Community producers in
raising capital. In this respect,
it should be noted that
as several of these companies are part of large groups,
they finance their activities within the group to which
they belong either
through cash-pooling schemes or
through intra-group loans granted by the mother
companies.

3.4. Conclusion

(115) Between 2002 and the RIP,

of

volume

positively:

production

the following indicators
developed
the
Community industry increased, unit sales prices of the
Community industry increased and profitability improved
substantially in line with the prices. Exports to third
countries increased and return on investment and cash
flow evolved positively as well. Wages developed
moderately and the Community industry continued to
invest.

(116) Conversely, the following indicators developed negatively:
sales volumes on the Community market decreased by
3 % as opposed to a growing market. Accordingly, the
market
the Community industry decreased
substantially by 8 percentage points during the period
considered. The productivity remained rather
stable
despite the
the Community industry to
improve it through investments.

efforts of

share of

(117) Overall, the situation of the Community industry has
improved significantly as compared to its
situation
prior to the imposition of the anti-dumping measures
on imports of UAN from the countries concerned in
It is therefore clear that these measures had a
2000.
the
positive impact on the economic situation of
Community industry. Nevertheless, it should be stressed
that the positive development of certain indicators can
also be partly attributed to the market of
the like
product, which was, due to the tight worldwide supply,
very favourable during the two last years of the period
considered. Furthermore, the positive development of the
Community industry’s
export performance has also
the
contributed to the overall positive evolution of
certain
Community industry counterbalancing to a
extent the shrinking market share within the Community.

(118)

is

therefore concluded that

It
the
Community industry has improved, as compared to the
period preceding the imposition of measures, but is still
fragile.

the situation of

4. Likelihood of recurrence of injury

4.1. General

from the four countries concerned,

focused on the likelihood of
In this
(i)

(119) Since there is no continuation of material injury caused
the
by imports
recurrence of
analysis
two main parameters were
injury.
analysed:
in the countries concerned
and its impact on the UAN production cost, and (ii)
the projected export volumes from the
the effect of
countries
on the
Community industry, taking into account the conditions
of competition.

respect,
the gas cost

the Community

concerned

to

4.2. Likely evolution of sales prices: Gas prices and cost of

production in the countries concerned

(120) The likelihood of the recurrence of injury will depend
strongly on the likely price evolution of UAN. As gas
is by far the most important cost element representing
more than 50 % of the UAN cost of production when
purchased at world market prices, and is therefore a
determining factor in the selling price of UAN. The gas
cost in the UAN production depends on the gas effi-
ciency use and the unit price. An analysis of these two
parameters in the production cost of UAN for
the
Community industry, on one side, and for Russia and
Algeria, on the other side, has been conducted.

(121) From this analysis it was firstly shown that gas efficiency
is an important factor in establishing the cost of gas per
tonne of UAN produced. In this respect,
it was found
that the gas efficiency of the Community industry was
relatively high, reaching up to 15 % lower consumption
of gas per tonne of UAN produced than that of the
producers in Russia and Algeria. This is the result of
the Community
to continuously
improve its productivity and competitiveness through
appropriate
capital
inflow approximating in average one third of its total
net book-value
advantage
should benefit the Community industry and result in a
lower cost of production of UAN.

assets. This

comparative

industry’s

investments

requiring

efforts

yearly

a

(122) Despite this efficiency,

than that of Russia

in these two countries

the Community industry ends
with a gas cost per tonne of UAN produced around
and Algeria
threefold higher
because of the gas price difference. The artificially low
gas prices
fully explain the
difference. The consequent price difference of UAN in
these two countries as compared to producers purchasing
gas at world market prices, like those in the Community,
is unlikely to be reduced in the near future. On the
contrary, should the current pattern in the development
of the world market gas prices in the forthcoming years
be maintained, this gap may be further broadened. On

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this basis, it is considered that producers in Russia and
Algeria will continue to have this artificial cost advantage,
which overcomes largely the high transport costs due to
the weight of UAN. This renders the Community market
attractive to producers even located in remote areas in
these countries bearing transport costs higher than 20 %
of the price.

producers are not relying on their lower gas cost by
setting lower prices, but on the contrary charge higher
prices and rather aim to maximise their profit margin.

(123)

those low gas prices,

the exporting
In the light of
producers in Russia and Algeria will
thus very likely
have the possibility to export the product concerned to
the Community at lower prices than the Community
industry’s cost of production. Therefore, it is very likely
that
the C.I.'s prices
substantially.

those imports would undercut

(124) As for Belarus and Ukraine, they are not included in this
analysis since for the purpose of this investigation both
were considered to be non-market economy countries
and therefore their data on cost of production were
not requested. However, specific data concerning gas
prices in these two countries were acquired and the
investigation has shown that
the producers in these
countries were being supplied with gas in the RIP at
substantially lower prices than the prices charged to the
Community industry. It is therefore considered that both
countries will equally have the possibility to export the
product concerned at lower prices than the Community
industry’s
can also be
concluded that
those prices
would undercut the C.I.'s prices.

cost of production and it
likelihood that

there is

(125) Should measures lapse,

that

the fact

the Belarusian,
Russian and Ukrainian exporters would need to re-
establish themselves on the Community market and the
Algerian exporters would need to strengthen their market
position may also support the view that there is a like-
lihood that those producers would charge lower prices
than the C.I.
in order to regain lost market share or
broaden their customer base.

(126) EFIA and certain exporting producers argued that lower
costs of production could not be considered as a valid
reason to justify the likelihood of recurrence of injury. It
was further submitted that the possibility to undercut is
not the legal standard to establish whether injury is likely
to recur. Moreover, Algeria charged prices above the
Community industry’s prices and Belarus, Russia and
Ukraine did not export
in
2004 and the RIP and their prices to third countries
were above the Community industry’s prices, which are
considered to be non-injurious. This evidence would
the exporting
demonstrate, according to EFIA,

to the Community at all

that

In this respect,

the parties acknowledge,

(127) The rationale behind the establishment of likelihood of
recurrence of injury is indeed whether the expiry of the
measures would create conditions that would encourage
it should be
the recurrence of injury.
firstly noted that, as
the
exporting producers in the countries concerned benefit
from low gas prices, which offer them the discretion to
undercut the Community industry’s prices. On the other
side, the investigation showed that their exports during
the RIP were dumped. This pricing behaviour was seen in
the exporters’ significant spare export
the light of
cost of
substantially lower
capacity,
production. The first indicates their strong incentive to
find the markets for selling their production. The second
shows
the
to
Community industry prices, in order to meet their sales
requirements in volume.

(i)
and (ii)

capability

undercut

severely

their

their

(128) With regard to the prices,

two years of

irrespective of

important costing element

it should be recalled that
during the last
the period considered,
favourable market conditions kept the prices at a very
high level
the applicable anti-dumping
measures. Indeed, during that period, a tight worldwide
supply demand balance resulted in high prices for all
nitrogen fertilisers. UAN is like the other nitrogen ferti-
lisers a commodity whose pricing is
influenced by
numerous factors, going from the volatile gas price
having a considerable impact on the supply as being
the most
to the weather
conditions, crops and grain stock levels resulting in
reduced or increased demand. With particular regard to
the Community market, the demand for nitrogen ferti-
lisers is expected to slightly decrease in the forthcoming
years (1). The maintenance of such high prices depends
therefore on a tight supply, which is nevertheless very
unlikely, as the investigation showed, given the spare
export capacity of the countries concerned and the like-
lihood of redirection of part of their exports to third
countries during the RIP,
should the measures be
lapsed. This scenario will very likely lead the exporting
producers to lower their prices undercutting the prices of
the Community industry, in order to gain market share
and meet their requirements in export volumes. Under
such circumstances, the Community industry would be
forced either to lower its prices to a level close to or
below the cost of production given the maintained high
cost of gas or to lose significant market share and thus
revenue, or both. An increase of exports to the USA
market is highly unlikely due to the reasons set out in
recital 135. Therefore, a deterioration of the Community
industry’s overall performance would be the inevitable
consequence of the repeal of the measures.

‘Global

(1) Source:

fertilisers and raw materials supply and supply/
demand balances: 2005-2009’, A05/71b, June 2005, International
Fertiliser Industry Association.

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(129) With regard to the profit-maximising argument, it should
be noted that this is based on the positive price differ-
ential observed during the period considered between the
USA and the Community market, which nevertheless
for
cannot be considered as an appreciation element
the future prices of a highly volatile commodity such
as UAN. On the basis of the above, it was established
that there is a high risk of recurrence of injury, should
the measures be repealed, and therefore the argument
was rejected.

4.3. Impact on the Community industry of the projected export
volumes and price effects in case of repeal of measures

4.3.1. P r e l i m i n a r y r e m a r k s — C o n d i t i o n s

o f c o m p e t i t i o n

(130) UAN is a liquid fertiliser supplying nitrogen to crops. It is
mainly used as a pre-planting fertiliser for arable crops,
which require UAN usually in the spring time. UAN has
a limited interchangeability with the other nitrogen ferti-
lisers as farmers use different equipment for applying
UAN and it can be mixed with other solutions, such as
pesticides, for a single application. Demand is therefore
characterised by seasonal peaks and is relatively inelastic.

(131) Although UAN is generally consumed seasonally,

a

are

it is
produced throughout the year as this is more efficient
than ceasing production. As
result, Community
found with peak inventories during
producers
the product
autumn and winter. Massive imports of
and
spring
concerned at depressed prices during
summer will very likely have a significant adverse effect
on the Community industry’s prices for such a highly
volatile
for
the product
which prices are set on a weekly basis.

commodity as

concerned,

export development of these three countries to the USA
market as of 2003:

Exports to the USA market
from:

2003 (*)

2004

RIP (**)

Belarus in tonnes

156 596

244 526

227 772

Russia in tonnes

179 993

614 395

699 100

Ukraine in tonnes

111 321

103 440

145 828

Total in tonnes

447 910

962 361

1 072 700

(*) The figures include the first three months of 2003, i.e. the period

within which the measures were still in place.

(**) The RIP is considered for the sake of comparison with the overall

analysis.

Source: ‘Foreign Trade Statistics’, published by the US Census Bureau.

(134) On this basis, it is shown that these countries increased
significantly their exported volume from 2003 to 2004.
in particular, the export volume
In the case of Russia,
rose from 180 000 tonnes in 2003 to about 600 000
tonnes in 2004, representing a more than threefold
increase. The above trade statistics also show that the
sharp and sudden increase in export volumes from
these countries to the USA came to a halt during the
RIP, where the increase in comparison to 2004 was less
their collective
profound (11 %). The stabilisation of
exports volumes
to around 1
to the USA market
million tonnes was confirmed by these countries’ post-
RIP export performance to the USA.

(135)

4.3.2. E x p o r t s

f r o m

t h e

c o u n t r i e s

c o n c e r n e d

(132) Given the absence of

exports

from the

countries
concerned except Algeria during the RIP, the analysis is
focused on the likelihood of redirection of exports made
the
to other
countries
Community market
In
addition,
the likely evolution of sales prices of UAN
has to be analysed.

towards
future.

during
in the

imminent

the RIP

the USA,

including the

In the final report of the USA anti-dumping investigation
on UAN imports from Belarus, Russia and Ukraine, the
reason for this stabilisation is described in detail (1). In
this report, it is specifically stated that the high ratio of
inland transportation costs means that the market for
imports is virtually limited to the coastal areas and that
these costs make final sales of imported UAN to many
areas of
important UAN
consumption States in the so-called ‘farm belt’ area, far
too expensive as compared to locally produced UAN. In
other words, there is a limit on the size of the USA
market with regard to imports, and the most significant
areas in terms of consumption remain shielded from
imports due to their location. In view of the observed
stabilisation of imports from Belarus, Russia and Ukraine,
as described in recital 134 above,
therefore
concluded that the USA market cannot absorb import
volumes significantly higher than those registered in the
RIP.

is

it

(133) Regarding the

to the
likely evolution of
Community market, it should be noted that imports of
UAN into the USA market originating in Belarus, Russia
and Ukraine were subject to anti-dumping measures until
their repeal in April 2003. The table below shows the

exports

(1) ‘Urea Ammonium Nitrate Solutions

from Belarus, Russia, and
Ukraine — Investigations Nos. 731-TA-1006, 1008 and 1009
(Final), Publication 3591’, April 2003, US International Trade
Commission, p. 25, V-4, V-5.

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(136)

the relative
In the above context, and in view of
proximity of
can be
it
the Community market,
concluded that significant sales or spare capacity in the
countries concerned, will be very likely directed toward
the Community market, should the measures be allowed
to lapse. Given the lower level of
transport costs as
compared to exports to the USA market, their export
prices can be substantially lower than those prevailing
in the USA market. Furthermore, as shown in recitals
50, 54 and 63, it was found that the sales of the coop-
erating exporting producers on the USA market were
made at prices lower than the respective normal values.

4.3.3. I m p a c t o f s p a r e c a p a c i t i e s

Algeria

(137)

It is recalled that the domestic market of the product
concerned in Algeria is insignificant and that virtually
all production capacity is export oriented. Furthermore,
the investigation showed that the current spare capacity
of the Algerian producers represent 10 % to 20 % of the
consumption on the Community market The total
current
around
300 000 to 350 000 tonnes.

estimated to be

capacity is

spare

(138)

In particular in view of the proximity of the Community
market, it is very likely that, if the measures were allowed
to lapse, this spare production capacity would be used
for production of the product concerned for export to
the Community (Algeria only has 4,8 % market share).
The expected high volumes would likely be at dumped
prices
injury to the Community
producers.

and likely cause

Belarus

(139)

It was found that there is a rapidly growing domestic
market, on which the sole producer sold two thirds of
its production during the RIP. Moreover, there were no
exports to the Community in 2004 and the RIP and the
to USA market have decreased despite the
exports
absence of
and favourable
market conditions.

anti-dumping measures

(140)

If the measures were allowed to lapse, the situation with
regard to Belarus would most likely change dramatically.
In view of the fact that the domestic price was less than
half of the prevailing market price in the Community
during the RIP, a rational economic decision would
lead the Belarusian producer to redirect significant quan-
to the
tities currently sold on the domestic market

Community market at dumped prices. A recurrence of
injury caused by high volumes of low prices imports
from Belarus would likely be the result.

Russia

(141) The Russian domestic market

is

relatively small as
compared to the spare capacity which, as already
to 600 000 to
mentioned in recital 66, amounts
700 000 tonnes
substantially
increased if
the non-cooperators or
capacities utilised currently in producing and exporting
urea and ammonium nitrate,
the two other nitrogen
fertilisers, are added.

and which may be

the capacities of

(142)

(143)

it is also worth noting that there are
In this respect,
currently trade defence measures
imposed by the
Community on imports of upstream products, namely
from Russia (1).
solid urea and ammonium nitrate,
Regarding the measures on urea, an expiry review inves-
tigation is currently being carried out (2). Moreover, an
interim review investigation limited to one major Russian
exporting producer is currently being carried out with
regard to the measures on ammonium nitrate (3).
these
Therefore, depending on the final outcome of
review investigations,
shifting of
production from those products to UAN, which could
then result in an additional substantial
increase of the
estimated spare capacity of the Russian producers.

there is a risk of

the Community market,

In view of the above there is a strong likelihood that
exports to the Community will
resume if measures
were allowed to lapse. The volumes of such imports
can conservatively be estimated to represent close to
considering the
20 % of
consumption on that market (see recital 86) and the
actual
the
extremely low gas prices being paid by the Russian
producers and the consequent pricing advantage for the
product concerned, such imports would likely cause
severe injury to the Community industry.

In view of

in Russia.

capacities

spare

Ukraine

(144) Among the countries concerned, Ukraine is at

this
the country with the largest spare capacity
range of 700 000 to
capacity alone
the Community

current
20 % of

estimated in the

moment
which is
800 000 tonnes. The
accounts
around
for
consumption.

spare

(1) Urea: Regulation (EC) No 901/2001 (OJ L 127, 8.5.2001, p. 11).
Ammonium nitrate: Regulation (EC) No 658/2002 (OJ L 102,
18.4.2002, p. 1),
amended by Regulation (EC) No
945/2005 (OJ L 160, 23.6.2005, p. 1).

last

as

(2) OJ C 105, 4.5.2006, p. 12.
(3) OJ C 300, 30.11.2005, p. 8.

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(145)

In the absence of a significant domestic market and in
view of the proximity of the Community market,
it is
likely that, should the measures lapse, massive exports
will be directed to the Community market. These
exports will as shown above probably be at dumped
levels
the
thereby
and
Community industry.

cause major

injury

to

4.4. Conclusion on likelihood of recurrence of injury

(146)

In view of the artificially low prices the producers in the
countries concerned pay for the basic raw material gas,
and the impact this has on the production cost of UAN,
it is likely that, if the measures were allowed to lapse, the
producers in the countries concerned will have the possi-
bility to export the product concerned at lower prices
than the Community industry's production cost.

be

could

turned

towards

should the measures

(147) All countries concerned but Belarus have a surplus
the
capacity which
Community market,
lapse. As
concerns Belarus, given the high sales volumes on the
domestic market at much lower prices
than those
prevailing on the Community market during the RIP, it
them would be
is very likely that at
should the
redirected to the Community market,
measures lapse. The lower transport costs for sales to
the Community as compared to the USA could also
stimulate a redirection of
to the Community
market. In addition, for all four countries a redirection
of part of their current exports from other countries to
the Community is likely if the current measures were
repealed as was demonstrated in recitals 132 to 136.

least part of

sales

strated by the significant increase in dumped exports of
UAN to the USA market during 2004 and the RIP, once
the USA anti-dumping measures were repealed in 2003.
Therefore,
sound economic decisions made by the
exporting producers will in all likelihood lead them to
switch from one product to the other for maintaining or
increasing their overall sales of nitrogen fertilisers and
profits
the above arguments
were rejected.

thereof. On this basis,

(150) The above leads to the conclusion that should measures
lapse, exports from the countries concerned would very
likely occur in significant volumes and at prices that
the Community industry’s prices in view of
undercut
their distorted and artificially low cost of production.
This would in all likelihood have the effect of reinforcing
the price-depressive trend on the market, with an
expected negative impact on the economic situation of
the Community industry. This would,
in particular,
recovery that was achieved in
impede the financial
2004 and the RIP,
leading to a likely recurrence of
injury. In other words, the more the market conditions
turn bearish, the sharper the price depression that can be
expected from the countries concerned, account being
taken of their significant difference in cost of production
and their spare capacity.

E. COMMUNITY INTEREST

1. Introduction

(151) According to Article 21 of the basic Regulation, it was
examined whether maintenance of
the existing anti-
dumping measures would be against the interest of the
Community as a whole. The determination of
the
Community interest was based on an appreciation of
all the various interests involved.

(148) EFIA and certain exporting producers submitted that the
assumption of shifting from urea and ammonium nitrate
production to UAN ignores the basic economic fact that
producers can not simply switch production without
additional
investments. Furthermore, they claimed that
producers will not give up more profitable products
just because anti-dumping measures on a less profitable
product are removed.

(152)

in the original

the interest of

investigation,
It should be recalled that,
to be
the adoption of measures was considered not
against
the Community. Furthermore,
the fact that the present investigation is a review, thus
analysing a situation in which anti-dumping measures
have already been in place, allows the assessment of
any undue negative impact on the parties concerned by
the current anti-dumping measures.

(149) With regard to the additional

investments required,

it
should be noted that most of
the major producing
exporters of nitrogen fertilisers are integrated producers
and therefore the decision on producing/exporting one
or the other product depends mainly on the market
products,
conditions. As
the
producers will
the most profitable
products.
the anti-dumping measures
play a major role in their decision, as this is demon-

the
indeed look for

In this respect,

profitable

for

(153) On this basis,

it was examined whether, despite the
conclusions on the likelihood of recurrence of injurious
dumping, compelling reasons existed which would lead
to the conclusion that it is not in the Community interest
to maintain measures in this particular case.

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2. Interest of the Community industry

(154) The Community industry has proven to be a structurally
viable industry. This was confirmed by the positive devel-
opment of
its economic situation observed after the
In
imposition of anti-dumping measures
particular, the Community industry improved its profit
situation between 2002 and the RIP.

in 2000.

resources

(159) EFIA submitted that the non-cooperation of importers
interest
from
should not be considered as a lack of
the unfair situation
their side but as a reflection of
required by an anti-
given the significant
limited
dumping investigation as opposed to their
resources due to their small or medium size enterprises.
Furthermore, they claimed that the investigation ignored
the cumulative effect of
the numerous anti-dumping
measures on fertilisers on importers, and thus failed to
apply a fair analysis of the effects on importers and
farmers.

(155)

the Community
It can reasonably be expected that
industry will continue to benefit
from the measures
currently imposed and further recover by reversing the
downward trend in market share and improving further
its profitability. Should the measures not be maintained,
it is likely that increased imports at dumped prices from
the countries concerned will occur thereby causing injury
to the Community industry by exerting a downward
pressure on the sales prices which will endanger its
currently positive but still fragile financial situation.

(160)

In this respect,
it should be noted that for importers
dealing with a wide range of fertilisers, UAN being one
of them, there is the possibility of supplying with the
sources not
different nitrogen fertilisers
from other
presently subject
to anti-dumping measures. On this
basis,
it was concluded that any negative impact from
the continuation of measures on importers would not be
a
continuation of
measures.

reason against

compelling

the

3. Interest of importers

(156) As mentioned in recital 10, only one importer indicated
its willingness to be included in the sample and provided
the basic information required in the sampling form.
However, after sending the full questionnaire to the
said importer,
it informed the Commission that it did
not wish to further cooperate with the investigation.

(157)

investigation it was
in the original
It is recalled that
found that the impact of the imposition of measures
would not be significant to the extent that the imports
would continue to take place albeit at non-injurious
prices and that as a rule, importers do not only deal in
UAN but also, to a significant extent, in other fertilisers.
Regarding the presumption that imports would continue
to take place, this was only confirmed by imports from
Algeria where an undertaking is
in place for one
exporting producer. This leads to the conclusion that
some importers may indeed have had negative conse-
quences from the imposition of measures, as indicated
in recital 66 of Commission Regulation (EC) No
617/2000 (1). However, the investigation did not show
the importers completely ceased their
that some of
activities, but
rather appeared to have focused on
different fertilisers as projected. Thus, the imposition of
measures appears to have had an overall limited impact
on the majority of importers/traders.

(158)

In the absence of cooperation from importers, there is no
reliable information available indicating that the main-
tenance of the measures will have a significant negative
effect on importers or traders.

(1) OJ L 75, 24.3.2000, p. 3.

4. Interest of users

(161) Users of UAN are farmers in the Community. Demand
for nitrogen fertilisers appears to be relatively inelastic
and farmers tend to buy from the cheapest source. In
the imposition of
examining the possible effect of
measures on users, it was concluded in the original inves-
tigation that given the small
incidence of the cost of
UAN on the farmers, any increase in these costs was
unlikely to have a significant adverse effect on them.
The fact that no users or user association provided any
information contradicting the above finding in the
framework of the current review investigation seems to
confirm that: (i) UAN represents a very small part of total
the measures
production costs for these farmers;
currently in force did not have any substantial negative
effect on their economic situation; and (iii) the conti-
nuation of measures would not adversely affect
the
financial interests of the users.

(ii)

5. Conclusion on Community interest

(162) Given the above,

it

is concluded that

compelling reasons against
current anti-dumping measures.

the maintenance of

there are no
the

F. ANTI-DUMPING MEASURES

(163) All parties were informed of

the essential

facts and
considerations on the basis of which it is intended to
recommend that the existing measures be maintained.
They were also granted a period to make representations
subsequent to this disclosure.

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(164)

It follows from the above that, as provided for by Article
11(2) of the basic Regulation, the anti-dumping measures
applicable to imports of UAN, originating in Algeria,
Belarus, Russia and Ukraine should be maintained. It is
recalled that these measures consist of specific duties,
with the exception of
the product
concerned which are manufactured and sold for export
to the Community by one Algerian company from which
an undertaking has been accepted,

the imports of

value pursuant to Article 145 of Commission Regulation (EEC)
No 2454/93 (1), the amount of anti-dumping duty, calculated
on the amounts set above, shall be reduced by a percentage
which corresponds to the apportioning of the price actually
paid or payable.

4.
Notwithstanding paragraph 1, the definitive anti-dumping
duty shall not apply to imports released into free circulation in
accordance with Article 2.

HAS ADOPTED THIS REGULATION:

Article 1

1.
A definitive anti-dumping duty is hereby imposed on
imports of mixtures of urea and ammonium nitrate in
aqueous or ammoniacal
solution falling within CN code
3102 80 00 and originating in Algeria, Belarus, Russia and
Ukraine.

2.

The amount of duty in euro per tonne shall be as follows:

Country

Manufacturer

Amount of
duty (per
tonne)

TARIC
additional
code

Unless otherwise

5.
concerning customs duties shall apply.

specified,

the provisions

in force

Article 2

1.
Imports declared for release into free circulation under the
following TARIC additional codes which are produced and
directly exported (i.e. shipped and invoiced) by the company
named below to a company in the Community acting as an
importer shall be exempt from the anti-dumping duty imposed
by Article 1 provided that such imports are imported in
conformity with paragraph 2 of this Article.

Algeria

All companies

EUR 6,88

A999

Country

Company

Belarus

All companies

EUR 17,86

—

Algeria

Fertalge Industries spa
12, Chemin AEK Gadouche
Hydra, Alger

TARIC
additional
code

A107

Russia

JSC Nevinnomyssky Azot
357030 Russian Federation
Stavropol region
Nevinnomyssk, Nizyaev st. 1

EUR 17,80

A176

All other companies

EUR 20,11

A999

Ukraine

All companies

EUR 26,17

—

The exemption shall be conditional upon presentation to
2.
the relevant Member State’s customs services of a valid under-
taking invoice issued by the exporting company containing the
essential elements listed in the Annex to this Regulation.

3.
In cases where goods have been damaged before entry
into free circulation and, therefore, the price actually paid or
payable is apportioned for the determination of the customs

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

Article 3

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

Done at Brussels, 19 December 2006.

For the Council
The President

J. KORKEAOJA

(1) OJ L 253, 11.10.1993, p. 40.

21.12.2006

EN

Official Journal of the European Union

L 365/49

ANNEX

Elements to be indicated in the undertaking invoice referred to in Article 2(2):

1. The TARIC additional code under which the goods on the invoice may be customs cleared at Community borders (as

specified in the Regulation).

2. The exact description of the goods, including:

— CN code,

— The nitrogen (‘N’) content of the product (in percentages),

— quantity (to be given in tonnes).

3. The description of the terms of the sale, including:

— price per tonne,

— the applicable payment terms,

— the applicable delivery terms,

— total discounts and rebates.

4. The name of the unrelated importer to which the invoice is issued directly by the company.

5. The name of the official of the company that has issued the undertaking invoice and the following signed declaration:

‘I, the undersigned, certify that the sale for direct export to the European Community of the goods covered by this
invoice is being made within the scope and under the terms of the undertaking offered by [company], and accepted by
the European Commission through Regulation (EC) No 617/2000. I declare that the information provided in this
invoice is complete and correct.’