Council Regulation (EC) No 407/2007 of 16 April 2007 imposing definitive anti-dumping measures and releasing the provisional duty imposed on imports of certain frozen strawberries originating in the People's Republic of China
Date: 2007-04-16
Institutions: Council of the European Union
Subjects: China, anti-dumping duty, anti-dumping legislation, frozen product, import, originating product, soft fruit

17.4.2007

EN

Official Journal of the European Union

L 100/1

(Acts adopted under the EC Treaty/Euratom Treaty whose publication is obligatory)

I

REGULATIONS

COUNCIL REGULATION (EC) No 407/2007

of 16 April 2007

imposing definitive anti-dumping measures and releasing the provisional duty imposed on imports
of certain frozen strawberries originating in the People's Republic of China

(3)

(4)

(5)

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 Articles 9 and 10(2) thereof,

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

Whereas:

(1)

(2)

A. PROCEDURE

1. Provisional Measures

On 18 October 2006 the Commission imposed, by
Regulation (EC) No 1551/2006 (2) (the provisional Regu-
lation), a provisional anti-dumping duty on imports of
certain frozen strawberries originating in the People's
Republic of China (PRC).

2. Subsequent procedure

Following the imposition of a provisional anti-dumping
duty on imports of certain frozen strawberries from the
PRC, all parties received a disclosure of the facts and
considerations on which the provisional Regulation was
based. All parties were granted a period within which
they could make representations in relation to these
disclosures.

Some interested parties submitted comments in writing.
Those parties who so requested were also granted an
opportunity
to be heard orally. The Commission
sought and verified all information it deemed necessary.
The oral and written comments submitted by the parties
were examined, and, where considered appropriate, the
provisional findings were modified accordingly.

by

All interested parties were informed of the essential facts
and considerations on the basis of which it was intended
to impose definitive measures and to release the amounts
secured by way of the provisional anti-dumping duty
(EC) No
imposed
1551/2006 (the final disclosure). The interested parties
were also granted a period within which they could make
representations subsequent to this disclosure. The oral
and written comments submitted by the parties were
considered and, where appropriate,
the findings have
been modified accordingly.

Commission

Regulation

3. Parties concerned by the proceeding

information it
The Commission continued to seek all
deemed necessary for
its definitive
the purpose of
findings. In addition to the verification visits undertaken
at the premises of the companies mentioned in recital 8
of the provisional Regulation,
it should be noted that
after the imposition of provisional measures, additional
on-spot visits were carried out at the premises of the
following Community users and importers:

Importers/traders:

— BS Foods BV, Gennep, The Netherlands,

(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 287, 18.10.2006, p. 3.

— Skogsmat AB, Karlstad, Sweden;

L 100/2

EN

Official Journal of the European Union

17.4.2007

Users/processors:

— Agrana Frucht GmbH & Co KG, Gleisdorf, Austria,

It was
between different types of
claimed for the same reason that frozen strawberries of
Chinese origin were not comparable to those produced
by the Community industry.

frozen strawberries.

— Agrana, S.A. Neuilly-sur-Seine, France,

— Dairy Fruits A/S, Odense, Denmark,

— Groupe Danone, Paris, France,

— Materne S.A.S., Limonest, France,

— Rudolf Wild GmbH & Co. KG, Eppelheim, Germany,

— Schwartauer Werke GmbH & Co KGaA, Bad

Schwartau, Germany,

— Yoplait France S.A.S., Boulogne, France.

4. Investigation period (IP)

It is recalled that the investigation period of dumping and
injury (IP) covered the period from 1 January 2005 to 31
December 2005. The examination of trends relevant for
the injury analysis covered the period from 1 January
2002 to the end of the IP (period considered).

One interested party has questioned the appropriateness
of the chosen investigation period claiming that the year
2005 was not representative as import prices in this year
were abnormally low. However, the selection of the IP
was made in accordance with Article 6(1) of the basic
Regulation which provides that the IP should normally
cover a period of not less than six months immediately
prior to the initiation of
the proceeding. Thus, any
alleged particularities concerning the year 2005 were
not
IP, but were
choice of
examined in the causality analysis.

reflected in the

the

Based on the above,
the investigation period (IP) as
detailed in recital 11 of the provisional Regulation is
hereby confirmed.

5. Product concerned and like product

It is recalled that, in recital 13 of the provisional Regu-
the product concerned was defined as straw-
lation,
berries, uncooked or cooked by steaming or boiling in
water, frozen, whether or not containing added sugar or
other sweeteners, originating in the People's Republic of
China currently classifiable within CN codes 0811 10 11,
0811 10 19 and 0811 10 90.

(6)

(7)

(8)

(9)

(11)

In recital 15 of the provisional Regulation, it was stated
that the investigation has shown that despite differences
in varieties, quality, size and post-processing, the different
types of the product concerned, as well as the frozen
strawberries produced and sold on the Community
market by the Community industry, all share the same
basic physical and biological characteristics and are
same purposes. They were
basically used for
therefore considered to constitute one single product.
As those interested parties did not provide any additional
evidence to substantiate their claim and no new facts
came to light, this claim is rejected.

the

(12)

In the absence of any further comments regarding the
product definition and the like product, the contents and
provisional conclusions of recitals 12 to 16 of the provi-
sional Regulation are hereby confirmed.

B. DUMPING

1. Market Economy Treatment

(13) No comment was received that was apt

to alter the
findings on market economy treatment. Therefore, the
findings set out in recitals 17 to 26 of the provisional
Regulation are confirmed.

2. Individual Treatment

(14)

The three exporting producers that were denied indi-
vidual treatment (IT) argued that this decision should
be reviewed. It is recalled that the three companies in
question did not meet criterion (b) and (e) under Article
9(5) of the basic Regulation. Criterion (b) requires that
export prices and quantities, and conditions of sale are
freely determined. Criterion (e) requires that state inter-
ference is not
such as to permit circumvention of
measures if
individual exporters are given individual
rates of duty.

(15) None of the arguments raised by the three companies in
the
question were apt
it was found that the
provisional stage.
companies concerned were exposed to state interference
which limited them in freely determining export quan-
tities (criterion (b)).

to alter the decision taken at

In particular,

(10)

Some interested parties have maintained that there are
in terms of use and quality
significant differences

(16)

Furthermore, state interference also prevailed to a degree
which would make circumvention of measures likely if
individual exporters were given individual rates of duty
(criterion (e)).

17.4.2007

EN

Official Journal of the European Union

L 100/3

(17)

In the absence of any further comments relating to the
findings on IT, the findings set out in recitals 27 and 28
of the provisional Regulation are confirmed.

2. Definition of the Community industry

(24)

In the absence of any comments,
the definition of
Community industry as set out in recitals 52 and 53
of the provisional Regulation is hereby confirmed.

3. Normal Value

the provisional measures, no
(18) After publication of
comment was
the
received that was apt
decision to use Turkey as an analogue country. The
decision is therefore confirmed.
It is recalled that for
the purpose of establishing normal value, the domestic
prices of Turkish strawberries had been adjusted to take
their better quality in comparison with
account of
Chinese strawberries (see recitals 39 and 44 of the provi-
sional Regulation).

to alter

(19)

In the absence of any further comments relating to the
findings on normal value, the findings set out in recitals
29 to 42 of the provisional Regulation are confirmed.

4. Export Price

(20)

In the absence of any comments relating to the findings
on export price, the findings set out in recital 43 of the
provisional Regulation are confirmed.

5. Comparison

(21)

Reference is made to recital 44 of the provisional Regu-
lation. In the absence of any comments that were apt to
alter the findings stated in that recital, the provisional
findings are hereby confirmed.

(25)

(26)

(27)

6. Dumping margin

(22)

In the light of the above, the dumping margins finally
determined,
the CIF
Community frontier price, duty unpaid, are as follows:

expressed as a percentage of

(28)

Yantai Yongchang Foodstuff 0 %

Dandong Junao Foodstuff 31,1 %

All other companies 66,9 %

C. INJURY

1. Community production

(23)

In the absence of any comments submitted, the provi-
sional
total Community
production as set out in recital 51 of the provisional
Regulation are hereby confirmed.

concerning

findings

the

3. Sampling for injury assessment purposes

in view of

is recalled that

It
the large number of
producers of frozen strawberries in the Community, a
sample of eight producers was chosen for the assessment
of injury. One interested party claimed that the sample of
Community producers was not representative because all
selected Community producers were located in Poland. It
was held that a sample based on the largest production
volume should also take into account the geographical
location of producers in order to be representative.

It should be recalled that recital 54 of the provisional
Regulation outlines that the selection of the sample was
made in accordance with Article 17(1) of the basic Regu-
lation which provides that a sample can be chosen based
on the largest representative volume of production that
can reasonably be investigated within the time available.

Thus, a selection of a sample based on this method
would have to primarily take into account the represen-
tativity in terms of production volume. It is not required
that the sample also covers a certain geographical repre-
sentation; this could, but clearly does not have to be, an
ancillary consideration.

Furthermore, since the production of frozen strawberries
is to a great extent concentrated in Poland, not only in
terms of volume but also in terms of number of
producers, a consideration of the geographical
location
would in this case not prevent the selection of a sample
consisting of only Polish producers. This argument is
therefore dismissed.

(29)

In the absence of any further comments, the selection of
the sample for injury purposes as set out in recitals 54
the provisional Regulation is hereby
and 55 of
confirmed.

4. Community consumption

(30)

In the absence of any comments,
the calculation of
Community consumption as set out in recitals 56 to
59 of the provisional Regulation is hereby confirmed.

L 100/4

EN

Official Journal of the European Union

17.4.2007

5. Imports into the Community from the countries

concerned

5.1. Volume and market share of the imports concerned

Community production as a whole presented in recitals
86 to 88 of the provisional Regulation. Therefore, the
findings as set out in these recitals of the provisional
Regulation are hereby confirmed.

(31)

the calculation of
In the absence of any comments,
volume and market share of the imports concerned as
set out in recitals 60 and 61 of the provisional Regu-
lation is hereby confirmed.

5.2. Prices of imports and undercutting

of

those

certain sales

and
the
it was noted that, at

(32) One party claimed that for the purpose of the under-
cutting analysis, an adjustment would have to be made
taking into account the qualitative differences between
the frozen strawberries produced by the Community
exporting
industry
producers.
the provisional stage,
However,
only
exporting
transactions
producers were taken into account in the calculation of
undercutting and underselling. Sales of low grade exports
were disregarded because such low quality products were
not produced and sold by the Community industry. In
these circumstances,
the adjustment claimed was not
warranted. In the absence of any further comments, the
prices of the imports concerned and the price under-
cutting findings as set out in recitals 62 to 64 of the
provisional Regulation are hereby confirmed.

the

of

(33)

6. Situation of the Community industry

relevant

the
It was claimed by some interested parties that
Community industry prices
increased in 2006 to
around EUR 1 000 per tonne and that this should be
reflected in the injury analysis. However,
it should be
recalled that the IP covered the period 1 January 2005
to 31 December 2005 and that the period for which
trends
injury be
examined, covered the period from 1 January 2002
until the end of the IP.
In these circumstances, price
the IP have not been taken into
movements after
in accordance with the
account in the injury analysis,
last sentence of Article 6(1) of
the basic Regulation.
The significance of the increase in prices in 2006 is
however considered below,
in Section D. Causation
(recitals 51 to 54).

assessment of

the

for

7. Conclusion on injury

(36)

In view of the above, it is confirmed that the Community
industry has suffered material injury within the meaning
of Article 3 of the basic Regulation.

D. CAUSATION

1. Comments by the interested parties

(37)

interested parties claimed that

imposition of provisional measures,
Following the
various
the material
injury suffered by the Community industry was caused
by other factors. A number of these claims had already
been duly addressed in the provisional Regulation. Any
new arguments are considered, where necessary, below.

2. Impact of imports from third countries

(38)

(39)

It was claimed that no sufficient consideration was given
to imports from Morocco as a cause of injury. One party
questioned the interpretation of the figures under recital
99 of
the
Moroccan price charged during the IP was lower than
the Community industry break-even price. It was held
that this had contributed to the injury.

the provisional Regulation,

indicating that

It is recalled that the table contained in recital 99 of the
provisional Regulation demonstrates that the Moroccan
price was consistently much higher than that of
the
Community industry. Moroccan exporters were also
affected by the low priced Chinese exports and had to
respond by reducing prices charged to the Community.
This is confirmed by the decreasing volumes of imports
of
frozen strawberries originating in Morocco. This
argument therefore had to be rejected.

(34) No interested party questioned the figures or their inter-
pretation relating to the situation of
the Community
industry as presented in recitals 66 to 85 of the provi-
sional Regulation. Therefore, the findings as set out in
these recitals of the provisional Regulation are hereby
confirmed.

6.1. Data of Community production as a whole

(35) No interested party questioned the figures or their inter-
to the macroeconomic data of

pretation relating

3. Impact of currency fluctuations

(40) During the IP, the Zloty depreciated against the Euro. It
was claimed by some interested parties that the price
decrease suffered by the Community industry would
appear less dramatic if calculations were analysed in
Zloty rather than in Euros. Between 2004 and 2005,
the Zloty did indeed fluctuate by
around 10 %.
However, when assessing the trends of Community
prices between these two years, the price decrease in
Euro was 35 %.

17.4.2007

EN

Official Journal of the European Union

L 100/5

(41)

the difference between the fluc-
Taking into account
tuation of the currency of around 10 % and the price
decrease which amounted to 35 %, the depreciation of
the Zloty against the Euro cannot be considered as a
the decrease in Community industry
major cause of
prices. This argument therefore had to be rejected.

(45)

(42)

(43)

(44)

4. Impact of alleged structural deficiencies or spec-
ulative business decisions by the Community
industry

Some interested parties further developed the argument
already addressed in the provisional Regulation in recitals
106 to 110, that injury was self-inflicted due to poor
business decisions and structural difficulties encountered
by the Community industry. To this end, a report from
the Commission to the Council and the European
Parliament on the situation of the sector of soft fruits
and cherries intended for processing, and annexed staff
working document on the same subject (1), as well as a
European Parliament resolution on the situation with
regard to soft fruits and cherries intended for processing
adopted on 12 October 2006 (2), were held to support
these claims.

It should be noted that the Commission took account of
the report in its provisional findings as evidenced by the
reference in recital 138 of the provisional Regulation.
While the report and the resolution provide important
background information about the red fruit sector within
the Community, it should be noted that they both focus
on the problems facing the growers of fresh strawberries
rather then the Community industry (freezers). In any
event, neither the report nor the resolution concludes
that the problems facing the Community industry are
due
the Community
industry itself.

to structural deficiencies of

It was further claimed that Poland's accession to the EU
to
resulted in the relocation of Polish labour
has
thus posing additional
countries with higher wages
problems for the industry in the form of
increased
labour costs on the domestic market. It was also held
that
the
Community industry could no longer rely on cheaper
It was
from neighbouring non-EU countries.
labour

result of new border

restrictions,

as

a

suggested that these developments have had significant
negative effects upon such a labour intensive industry.

industry. Moreover

the farmers. However,

there is only a partial

the farmers and the costs of

These developments could have led to an increase of the
labour costs of
this possible
increase relates directly to the costs of the farmers and
not to the costs of the Community industry (freezers).
link between the
Therefore,
the
increased costs of
Community
to the
Commission report and staff paper as referred to in
recital 42,
it would appear that despite a rise in the
cost of production, the sales prices of fresh strawberries
decreased rather than increased after the accession of
Poland to the European Union. Considering that
the
sales prices went down, there could not have been an
effect on the Community industry of the increase in costs
facing the farmers of fresh strawberries. This argument
therefore has to be rejected.

according

(46) One party claimed that the investments and restructuring
executed by the Community industry in order to improve
efficiency has negatively affected its profitability and cash
flow. However, any costs encountered by the Community
industry in terms of investments do not alter the fact that
prices fell significantly to an injurious level during the IP
and that it was the low prices that had by far the greatest
impact on the profitability of the Community industry.
Indeed, the investments made contributed to greater effi-
ciency by the Community industry, as stated in recital 81
of the provisional Regulation. This argument therefore
has to be rejected.

(47)

It was additionally claimed that the injury suffered by the
Community industry was self inflicted because the quality
of the produce was lower than that originating in Spain
and California. To this end, it should be noted that Spain
and California both produce predominantly for the fresh
market and that there have been no indications showing
that the Community industry has lost market share by
comparison to these producers. Imports of frozen straw-
berries from the US were less than 200 tonnes during
the IP and could not have had any substantial impact on
the profitability of
the Community industry. This
argument therefore has to be rejected.

(1) Report of 28 June 2006 from the Commission to the Council and
the European Parliament on the situation of the sector of soft fruits
intended for processing (COM(2006) 0345), and
and cherries
annexed Commission staff working document,
the
sector of soft fruits and cherries intended for processing in the
EU’ (SEC(2006) 838).

‘Review of

(2) Text adopted at the sitting of 12 October 2006, Part 2, Provisional

Edition, P-6 TA PROV(2006) 10-12, PE 378/421, p. 69.

(48)

In any event, regarding the alleged structural deficiencies
of the Community industry, there is no evidence demon-
strating such deficiencies on the part of that industry.
These claims must therefore be rejected. The conclusions
reached in recitals 106 to 110 of the provisional Regu-
lation are hereby confirmed.

L 100/6

EN

Official Journal of the European Union

17.4.2007

5. Self-inflicted injury as a result of the price levels

set by the Community industry

that prices of the product concerned follow a cyclical
pattern, strongly influenced by the weather and crop size.

(49)

(50)

(51)

In the context of the allegation of speculative business
decisions on behalf of
the Community industry, as
referred to in recital 108 and 110 of the provisional
claimed that prices on the
Regulation, one user
Community market were not
set by the Chinese
imports but predominantly by the Community industry
holding the highest market share. This party thus alleged
that
the
Community industry itself and not by any dumped
Chinese imports.

the price decreasing

trend was

set by

It is clear that the Community industry retained a market
share in the IP of 59 %, thus maintaining a significant
role as regards market prices. However, even if
the
Community industry's market share was high, it cannot
be denied that low priced imports from the PRC that
undercut the Community industry's prices by 6 %, had
a negative impact on the market prices. Those dumped
imports exerted an overall downward price pressure on
prices within the Community and also managed to
considerably increase their market share from 4 % in
2002 to 20 % in the IP. The argument therefore has to
be rejected.

(53)

(54)

It must however be recalled that the volume of imports
from China increased by 380 % at prices that decreased
by 38 % during the period considered and that this had a
significant effect on the financial situation of Community
industry that reported unsustainable losses.

Even though the natural fluctuation in prices of frozen
the harvest size have
strawberries and the impact of
impact on the prices of
certainly had a significant
in themselves be
Community industry,
considered the sole or major significant cause of the
injury suffered by Community industry.

they cannot

7. Conclusion on causation

(55) As concluded in recitals 97 and 98 of the provisional
Regulation the investigation has shown that there was a
causal link between the dumped imports from the PRC
and the injury observed with the Community industry.

6. The cyclical nature of frozen strawberries and the

impact of the size of the harvest

(56)

Frozen strawberries are a sensitive agricultural product
and the investigation has shown that the availability of
fresh strawberries is of major importance to the price of
frozen strawberries. Several interested parties argued that
the particularly poor harvest in 2003 was a major cause
of the injury found during the IP. Some interested parties
also asserted that
the price of strawberries typically
follows a four year cycle whereby a price increase leads
to overproduction and then to a price collapse. It was
claimed that 2005 marked the low point in this cycle
and that the particularly low prices experienced in that
year were a result of
fluctuation. Price
variations could also be observed for a period before
2002 and this argument was further supported by the
+/– 20 % increase in price that was seen in 2006, i.e. the
year following the IP.

this natural

(57)

The investigation has also shown that there is a corre-
lation between the prices of the Community industry and
the price fluctuations linked to the cyclical nature as well
as seasonal variations in the harvest. This conclusion is
supported by data from before and during the period
considered, as well as by the development after the IP.

cyclical

variations may have
Even though these
the Community
aggravated the financial situation of
industry,
the
in prices of
the magnitude in the fall
Community industry, and the negative trend seen in
the analysis of the situation of the Community industry
as described in recitals 66 to 85 of the provisional Regu-
lation, cannot be solely attributed to the ‘natural fluc-
tuation patterns’. The analysis of
the
cyclical nature of
the
harvest does not therefore support the argument that
these factors would have been significant enough as to
breach the causal link between the dumped imports and
the injury suffered by the Community industry.

the impact of
the product and the size of

(52)

Further analysis of prices of frozen strawberries beyond
the period concerned did indicate that price fluctuations
also occurred over a significant period of time prior to
2002. For example, during the campaign in 2001, the
abundant harvest led to very low prices. These low prices
then led to a decrease in production of fresh strawberries
in the following years, allowing prices to stabilise them-
selves again. An analysis of the trends supports claims

(58) On the basis of the above, and in the absence of any
further
the
conclusions reached in recitals 113 to 114 of the provi-
sional Regulation are confirmed.

comments

causation,

respect

to

in

17.4.2007

EN

Official Journal of the European Union

L 100/7

E. COMMUNITY INTEREST

1. General considerations

(59)

It has been analysed whether, in light of the comments
and additional elements provided by interested parties
following the imposition of provisional measures, the
provisional conclusion that the imposition of measures
was not contrary to the Community interest remained
valid. As at the provisional stage, the determination of
the Community interest was based on an appreciation of
all
the
interests involved,
the different
i.e.
Community industry,
importers, processors/users and
farmers.

those of

for

further processing. Although it

would risk going out of business. It is recalled that the
estimated number of commercial producers of
fresh
strawberries in Poland was 96 700 in 2002 out of
which around 80 000 were involved in the growing of
is
strawberries
possible that this number has decreased as a consequence
of consolidation of the sector, it is nevertheless clear that
the farming of strawberries is an important economic
activity for a large number of farms in Poland. It has
been argued that the sector for growing strawberries in
Poland is of key importance to a number of regions in
the country that are otherwise characterised by high
unemployment and that the failure to impose measures
would increase these unemployment figures even more.
It has also been held that these farmers cannot switch to
other more profitable crops since the soil conditions in
these areas are mainly suitable for strawberry farming.

(60)

The Commission indeed contacted a significant number
of interested parties to obtain their views. In addition to
the Community industry, representatives of all the major
user brands on the market as well as associations repre-
senting the interests of the users have been heard and
additional on-the-spot verifications have been carried out.

(63) As stated in the provisional Regulation (recital 139),
prices paid to the farmers from 2004 and onwards
have been so low that the cost of production has not
been covered.

2. Interest of

the Community industry and the

upstream industry

(64)

(61) At the preliminary stage, the investigation showed that
Community production was manufactured by a large
number of producers in the freezing industry which
employs around 2 700 people for the production and
sales of the product concerned. There is also a partial
link between the situation of the freezer industry and the
farmers supplying strawberries given that the latter grow
only the type of strawberries destined for freezing and
that
for that
product.

the freezers constitute the only market

supported by the report

from the
In addition, as
Commission referred to in recital 42,
the Polish
strawberry farmers constitute a fragmented industry and
it is not probable that they could reach out to markets
other than the local freezing industry. Consequently, the
deteriorating financial situation of the freezer industry
would have a substantial
impact on the farmers. The
fact that after the IP market prices increased again to
non-injurious
levels
decreased, may cast some doubt on the necessity of
measures to remedy the situation of
the Community
industry but
there are no indications predicting that
this increase would be of a permanent, or even of a
long-lasting nature.

levels and that Chinese import

(62)

is recalled that

It
the Community producers suffered
substantial injury in the period considered and reported
losses of 12,5 % as a consequence of
the dumped
imports. These losses were reported despite the fact
that
the Community industry reduced its costs by
reducing the prices that it paid to the farmers for fresh
strawberries. The price paid for fresh strawberries was
below the farmers' cost of production and would
therefore be unsustainable both for the farmers and the
Community industry in the long run. Should prices of
frozen strawberries again drop to below the non-
the consequences would be twofold.
injurious
Community industry would suffer financial
losses but
would also risk running out of supply of fresh straw-
berries in the long term since the prices they would be
able to pay the farmers would be so low that farmers

level

farmers would benefit

(65) Under these circumstances it is clear that the Community
industry and the
from the
adoption of anti-dumping measures and that measures
could have a stabilising effect on the Community
market. The prices of frozen strawberries would not be
depressed as a result of imports of strawberries origi-
nating in the PRC. Thus, Community producers would
be able to increase their prices and to obtain a reasonable
likelihood have positive
profit margin. This will
in all
effects upon the upstream industry.
therefore
is
concluded that the imposition of measures would be in
the
the Community industry and the
strawberry farmers.

interest of

It

L 100/8

EN

Official Journal of the European Union

17.4.2007

(66)

3. Interest of unrelated importers

visited

Further to the findings at the preliminary stage of the
the Commission
investigation,
two more
importers of
the product concerned. These importers
import the product concerned from the PRC although
each of them also trades strawberries produced in the
EU, which represent between 50 to 60 % of
their
respective purchases. It has to be noted, however, that
trading frozen strawberries only constitutes a part of
their business activities and accounts for 30 to 50 % of
imports from the PRC
their overall
turnover. Their
represent around 14 % of all
imports of the product
concerned. The importers are therefore considered to
be representative. Both importers expressed opposition
to anti-dumping measures. The investigation has shown
that, given that the demand for strawberries is driven by
consumer preferences which will not be affected by the
imposition of anti dumping measures, the demand for
likely to change. Thus,
frozen strawberries
importers are unlikely to be affected by higher prices,
as they could continue importing the same quantities
as before and would in all
likelihood be able to pass
on a substantial part of additional costs of frozen straw-
berries onto the users. This is confirmed by the fact that
past price differences did not affect the sales price and
profit margins of the importers as they remained fairly
stable.

is not

(67)

The provisional conclusion drawn in the provisional
the effects on the importers by
Regulation,
that
increased prices of
imports are not expected to be
substantial, is hereby confirmed.

i.e.

4. Interest of users and consumers

4.1. Level of cooperation

the Commission renewed therefore

(68) As noted in recital 127 of the provisional Regulation, the
response from users and processors was limited at the
outset. In the preliminary stage of the proceeding the
Commission encountered difficulties in collecting and
verifying data which would substantiate the claims of
the user industry. After publication of the provisional
Regulation,
its
efforts to encourage cooperation. Supplementary on-the
spot verification visits took place in the premises of eight
user companies. Out of these, data that allowed for a
impact assessment could be obtained from
meaningful
information and data were
five companies. Additional
collected. With this
the
Commission services undertook a new analysis of the
potential effects that the imposition of measures would
have upon Community users.

supplementary information,

(69) One interested party argued that this cooperation should
not be considered as it was not submitted within the
In this
time limits

in the Notice of

Initiation.

set

it has

to be noted that

cooperating
regard,
companies made
themselves known and provided
comments on the provisional measures in accordance
with the rules laid down in the basic Regulation.

the

(70)

(71)

(72)

(73)

The information verified on the spot concerns around
9 % of the overall Community level of consumption. In
addition,
the different user sectors were represented:
producers of strawberry preparations used as input for
other products (e.g. yoghurts), yoghurt producers, and
producers of strawberry jam. Finally,
the cooperating
associations represent around 80 % of the Community
consumption of frozen strawberries. The recognition of
such a level of representativity is consistent with the
general practice. Therefore,
the argument on lack of
representativity had to be rejected.

4.2. Cost impact of measures

The user industry claimed that the Commission should
evaluate the impact of measures not only by analysing a
possible price increase of imported Chinese strawberries.
Measures would have a broader impact on the market
including frozen strawberries from other sources.

the deepened investigation has

shown that
Indeed,
measures will very likely provoke a more general price
rise, not limited to the order of 34,2 % (level of the
for Chinese strawberries. They may
provisional duty)
also be likely to lead to a price increase for
the
Community industry by about 19 %, up to the calculated
non-injurious level. Such an overall price increase would
indeed appear unavoidable because, unlike in other
sectors and in view of the limitations imposed by the
weather and crop results, other strategies such as market
expansion in terms of volumes would appear not to be
an option for the Community industry. Finally, since the
Community industry and the Chinese imports combined
represent about 80 % of Community consumption, it is
very likely that other countries exporting frozen straw-
berries to the Community will also increase their prices
in order to follow the ‘price leaders’.

Regarding the strawberry-related activities of the users,
under these circumstances the imposition of a duty at
the level set in the provisional measures would entail a
cost increase of inputs for the users of on average around
6 %. Indeed, quite a few of the users would be forced
into a loss making position. The conclusions have been
based on the strawberry related activities, as the investi-
gation focuses on frozen strawberries as the product
concerned and does not concern other activities of the
companies involved. Also for the purpose of carrying out
an injury and dumping analysis it has to be ensured that
like activities are being compared, i.e. activities related to
the product under investigation.

17.4.2007

EN

Official Journal of the European Union

L 100/9

The table below demonstrates the impact on the costs of the verified users:

Company

Actual profit (IP)
2005 (*)

Profit on 2005 (IP)
basis if prices of
strawberries of all
origins increase in
accordance with the
formula specified in
recital 74 and resale
prices do not
change (*)

Profit as in previous
column but on basis
of reported actual (or
increased) resale
prices for 2006 (*)

Share of strawberry
products in company
turnover (2005)

Overall company
profitability (2005)

Company A

Company B

Between + 2 %
and + 4 %

Between – 4 %
and – 6 %

Between – 3,0 %
and – 5,0 %

Between 25 %
and 30 %

Between + 2,5 %
and + 5,0 %

Between + 1,0 %
and + 2,5 %

Between – 1,0 %
and – 2,5 %

Around 0 %

Between 12 %
and 17 %

Between + 4,0 %
and + 5,5 %

Company C

Around 0 %

Around – 1 %

Between + 2 %
and + 4 %

Between 5 %
and 10 %

Around 0 %

Company D

Between
+ 12,0 %
and + 14,0 %

Between + 4 %
and + 8,0 %

Between + 3,0 %
and + 5,0 %

Between 10 %
and 15 %

Between + 5,0 %
and + 8,0 %

Company E

Between + 3,0 %
and + 5,0 %

Between – 4,0 %
and – 6,0 %

Between – 7,0 %
and – 9,0 %

Between 18 %
and 23 %

Around 1 %

(*) For activity related to strawberries only.

(74)

(75)

(76)

The cooperating producers of strawberry preparations
and jam would be the most affected by an increase in
strawberry prices. This is due to the fact that the relative
importance of strawberries in the jam recipe is far greater
than that of the other ingredients. For the companies in
question, the deterioration of their profit margin would
be in the range of between 7 to 8 percentage points,
which for two of them would trigger losses of around
5 %.

the cooperating yoghurt producers

For
the relative
importance of the cost of strawberries in their cost of
production is less, since the cost of milk products is
added to the recipe calculation. Nevertheless,
it was
found that their profit margin, on average, was quite
low. Thus, even if the total cost for the production of
given yoghurt only increases by 2 %, this is sufficient to
turn a profit of around 1 % into a loss of around 1 %.

Consequently,
the impact of measures on the user
industry in terms of the cost increase might be greater
than estimated in the analysis leading up to the provi-
sional measures. However, as shown below in Section
4.4, this cost impact is likely to be less hard felt in the
long term.

(78)

4.3. Inability to pass on cost increases in the distribution chain

(77) One user association claimed that duties would damage
internationally competitive Community based users of

It was claimed that

frozen strawberries.
the duties
could not be passed onto their customers (retailers and
since many users concluded long term
distributors)
contracts with fixed prices with these customers. These
fixed prices mean that the users bear the risk of any
additional price rises. Many users claimed and provided
evidence that they were under price pressure from the
big retailers/distributors and that it was very difficult to
raise their prices.
It has been held that the contracts
between users and the retail sector fix the prices for
periods between 6 months and a year. Therefore, the
to
users claim that
absorb the additional costs themselves. In view of the
above it must be recognised that the users are likely to
have to absorb the increase in cost, at least in the short
term. The investigation has also revealed, however, that
notwithstanding the negative effect of measures on the
incorporating the product
profitability for products
concerned,
user
of
profitability
companies would remain positive for most of the users.

they would have no choice but

overall

the

the

To the extent that cost increases can be passed on, this
may have a certain effect on consumer prices. Indeed
fruit preparations, especially yoghurts, are part of the
staple diet for a large segment of consumers. Strawberry
flavour makes up around 20 % to 30 % of the yoghurt
market and notwithstanding the fact that no consumer
organisations have made submissions in this respect, it
cannot be excluded that a price increase could have an
impact on consumers, at least in the medium to long
term. The same holds true for jams.

L 100/10

EN

Official Journal of the European Union

17.4.2007

4.4. The temporary nature of impact on users

(79) Under Sections 4.2 and 4.3 it has been demonstrated
that
the imposition of measures is likely to have an
impact on the cost of input materials of the users and
users have furthermore asserted that this cost increase
will have to be borne by themselves for the duration
of the contract with the retail sector. It could however
be presumed that this inability to pass on an eventual
the
cost
contracts is limited in time.

the duration of

temporary, as

increase is

(80)

(81)

4.5. Availability of Community industry supplies

It has been broadly held by the users that the supply of
Polish strawberries of
the Senga sengana variety is
essential to the volume as well as to the quality of the
production of the full range of products derived from
frozen strawberries. Thus,
the danger of deterioration
of the situation of the Community industry would have
a considerable negative impact upon them. It cannot be
excluded that in the situation of limited availability or
unavailability of the Polish strawberries on the market,
the users would face serious problems in finding alter-
native sources of supply for the varieties of strawberries
produced in Poland. In fact, it seems highly improbable
that such alternative sources could be found as the users
themselves stated that the quality found in Poland could
not be found anywhere else. Furthermore, it could not be
excluded that in a situation of reduced competition on
the market the users would anyway be faced with the
price increase.

5. Conclusion on Community interest

investigation has
producers

the
The
Community
2 700
persons but also the around 80 000 farmers that are
more or less dependent on strawberries for their live-
lihood would benefit from the imposition of measures.

shown that not only
employing

around

(82) As detailed in recital 133 of the provisional Regulation,
the user industry has indicated that the supply of the
product concerned by Community industry is essential
in order for the users to cover their full range and
provide a high quality product to the market. The inves-
tigation has shown that the cyclical nature of the raw
material for the Community industry, i.e. the variations
in the strawberry crops, has significant impact on prices
which is confirmed by developments after the IP. Never-
theless, as detailed in recital 74 of the provisional Regu-
lation, prices were so depressed in the latter part of the
period considered and the IP that
the Community
industry was forced to pay below the cost of production
prices to the farmers when purchasing fresh strawberries.
This resulted in the cessation of strawberry production
by some of the farmers. Even though prices have gone
up in 2006,
it is clear that the supply of fresh straw-
berries to the Community industry, and in extension also

to the users, could be endangered should the low-price
trend as seen in the period considered reoccur.

(83)

(84)

(85)

The deepened investigation has indeed shown that the
impact of the anti-dumping duty on the users in this
case would be significant. The duty would result
in
reduced profitability or even financial
losses, some of
them heavy, for a number of the users, especially since
this price increase may not be transferred to the distri-
term. These effects are
butor/retail
however much less pronounced when looking at
the
overall profitability of the investigated users.

in the short

level

The user industry has argued that it is the existence of
fixed-price contracts with the user industry that prevents
the processing industry from passing on the cost increase
in case of measures to the retail sector. Considering that
these contracts run for a limited period of time it must
however also be presumed that the inability for the user
industry to pass on the cost increase would only apply
for a period of 6 to 12 months.

this impact

It thus appears that the imposition of definitive measures
would have a material impact on users of frozen straw-
berries but
is likely to be temporary in
nature. In contrast, the adverse effects on Community
industry and farmers would be of a substantial and
lasting nature should measures not be imposed and the
drop in prices allowed to reoccur.

(86)

Based on the above it is therefore concluded that there
are no compelling reasons not to impose anti-dumping
duties on imports of frozen strawberries originating in
the PRC.

F. IMPOSITION OF DEFINITIVE MEASURES

1. Form of the definitive measures

(87)

In view of the definitive conclusions reached with regard
to dumping, injury, causation, and Community interest,
anti-dumping measures should be imposed in order to
prevent further injury to Community industry resulting
from the dumped exports.

(88) Anti-dumping measures may take different forms. While
the Commission has a large discretion when choosing
the form of measures, the purpose remains to remove
the effects of the injurious dumping. An ad valorem duty
set
in accordance with the lesser duty rule, ranging
between 0 % for the exporting producer granted market
economy status, 12,6 % for
the exporting producer
granted IT and 34,2 % for all other companies, was
established in the provisional Regulation.

17.4.2007

EN

Official Journal of the European Union

L 100/11

(89) After

(51),

in rectal

the price of

the adoption of provisional measures, and as
the product
pointed out
concerned on the Community market
increased by
+/– 20 %, in 2006, the year following the investigation
period. Given that the product concerned is rather homo-
geneous and in order to avoid that measures burden
users disproportionately in these circumstances,
is
considered that a minimum import price, hereafter
‘MIP’, would be the most appropriate form of measures
in this case. Note that the purpose of the minimum
import price is the same as that of the ad valorem duty,
i.e. to remove the effects of injurious dumping. Under
this form of duty, no duty will be payable for imports
undertaken at the cif Community border price that are
equal to or above the minimum import price. If imports
are undertaken at a lower price, the difference between
the actual and the MIP would become payable.

it

levels of customs duties, depending on the
different
amount of added sugar or other sweetening matters
contained in the imported goods. In order to take into
account the different levels of customs duties, distinct
MIPs per CN code had to be established.

(95) As established under recital 153 of the provisional Regu-
lation, one Chinese exporting producer was not found to
export
frozen strawberries at dumped price. Subse-
quently, no anti-dumping measure will be applied to
exports by that company.

(90) As regards the level of the MIP, this has been established
based on the same findings, notably the same margins of
dumping and underselling, as set out in the provisional
Regulation.

(96)

In all other cases, the non injurious MIP of EUR 684,20,
which is applicable to all Chinese exports, was found to
be lower than the respective non dumped MIPs. The MIP
has therefore been established at the level of the non
injurious MIP for all other exports from the PRC.

(91)

In establishing the MIP, account has been taken both of
the dumping margins found and of
the amounts of
duties necessary to eliminate the injury sustained by
Community industry.

(92)

(93)

2. Injury elimination level

In accordance with Article 9(4) of the basic Regulation,
the definitive duty should be set at the level of dumping
or injury margins, which ever is the lowest. Therefore, a
non-injurious price or, non-injurious MIP, had to be
rule. This non
established in order
injurious MIP was then compared against a company
specific non-dumped MIP which was based on the
normal value adjusted to the net
free-at-Community-
frontier price.

to apply this

For the purpose of calculating the non-injurious price,
account had to be taken of the level of duties needed
in order for Community industry to cover the cost of
production and obtain a profit before tax that could
reasonably be achieved by an industry of this type in
the sector under normal conditions of competition. In
the absence of any comments from interested parties
the same considerations as stipulated in recital 144 of
the provisional Regulation were used to determine a
profit margin of 6,5 %.

(94)

Frozen strawberries are imported under three different
codes in the Combined Nomenclature (CN codes) with

(97) Where imports are undertaken at a cif Community
to, or above the MIP, no
border price that
duty would be payable. Conversely,
imports are
if
undertaken at prices below the MIP, a duty corre-
sponding to the price actually paid and the MIP will be
payable.

is equal

3. Definitive collection of the provisional duties

(98)

The provisional duties in the form of ad valorem duties
ranging between 0 and 34,2 % for the imported product
which applied during the period from 19 October 2006
the ad
shall be released. The definitive collection of
valorem duties would be disproportionate
to the
removal of injurious dumping given that prices during
this period were significantly above those of the MIP.

4. Enforceability of the MIP

(99) A duty system under MIP may be more difficult

Indeed,

in view of

and more open to misdeclaration of

to
the
enforce
customs value of the goods than other forms of the
measure.
the potential risk which
exists for compensatory arrangements in this market
it is necessary to introduce a double system of
sector,
measures. This double system is composed of a MIP and
a fixed duty. In accordance with Article 9(4) of the basic
Regulation, the fixed duty was calculated on the basis of
the weighted average injury margin as this was found to
be lower than the weighted average dumping margin. To

L 100/12

EN

Official Journal of the European Union

17.4.2007

(i)

free

the net

ensure the effective respect of the MIP, importers should
be made aware that when it is found following, a post-
importation verification that
at
Community frontier price actually paid by the first inde-
pendent customer in the Community (post importation
price) is below the net free-at-Community-frontier price
before duty, as resulting from the customs declaration;
and (ii) the post-importation price is lower than the MIP,
a fixed duty shall apply retrospectively for the relevant
transactions, unless the application of a fixed duty plus
the post-importation price lead to an amount
(price
actually paid plus fixed duty) which remains below the
MIP. In such cases an amount of duty equivalent to the
difference between the MIP and the post-importation
price shall apply. Customs authorities should inform
the Commission immediately whenever indications of a
misdeclaration are found.

(100)

the Commission intends to put

In this context, and in order to address the concerns
raised,
in place two
specific pillars to ensure that the measures continue to
be relevant whilst also being fully respected. Firstly,
reference is made to Council Regulation (EEC) No
the
2913/92 of 12 October 1992 establishing
Community Customs Code (1),
inter alia, to Article 78,
according to which the customs authorities may inspect
the commercial documents and data relating to the
import or export operations in respect of
the goods
commercial operations
to subsequent
concerned or
involving those goods. Such inspections may be carried
out at the premises of the declarant, of any other person
directly or indirectly involved in the said operations in a
business capacity or of any other person in possession of
the said documents and data for business purposes.
Those authorities may also examine the goods.

(101) Secondly,

in order to best guard against any possible
absorption of the measures, particularly between related
companies, the Commission hereby notifies its intention
to immediately initiate a review under Article 12(1) of
the basic Regulation and may subject importations to
the
registration in accordance with Article 14(5) of
such
basic Regulation,
behaviour be provided.

evidence

should

any

of

(102) The Commission will

alia, on import
rely,
surveillance information provided by national customs
authorities, as well as information provided by Member
States pursuant to Article 14(6) of the basic Regulation,

inter

(1) OJ L 302, 19.10.1992, p. 1. Regulation as last amended by Regu-

lation (EC) No 1791/2006 (OJ L 363, 20.12.2006, p. 1).

HAS ADOPTED THIS REGULATION:

Article 1

1.
A definitive anti-dumping duty is hereby imposed on
imports of strawberries, uncooked or cooked by steaming or
boiling in water, frozen, whether or not containing added sugar
or other sweeteners, originating in the People's Republic of
China and falling within CN codes 0811 10 11, 0811 10 19
and 0811 10 90.

The amount of the definitive anti-dumping duty in respect

2.
of Yantai Yongchang Foodstuff shall be:

Company

Definitive Duty

TARIC additional code

Yantai Yongchang Foodstuff

0,0 %

A779

3.
For all other companies, the amount of the definitive anti-
dumping duty shall be the difference between the minimum
import price fixed in paragraph 4 and the net
free at
if the latter is lower
Community frontier price, before duty,
than the former. No duty shall be collected where the net
free-at-Community-frontier price is equal
to or higher than
the corresponding minimum import price fixed in paragraph 4.

For the purpose of paragraph 3, the minimum import
4.
in column 2 in the table below shall apply.
price set out
Where it
following post-importation verification,
found,
is
that the net free-at-Community-frontier price actually paid by
the first independent customer in the Community (post-impor-
tation price) is below the net free-at-Community-frontier price,
before duty, as resulting from the customs declaration, and the
post-importation price is lower than the minimum import price,
the fixed anti-dumping duty set out as appropriate in column 3
or 4 of the table below shall apply, unless the application of the
fixed duty set out as appropriate in column 3 or 4 plus the
post-importation price lead to an amount (price actually paid
plus fixed duty) which remains below the minimum import
price set out in column 2 in the table below. In such a case,
an amount of duty equivalent to the difference between the
minimum import price set out
in column 2 in the table
below and the post-importation price shall apply. Where such
fixed anti-dumping duty is collected retrospectively, it shall be
collected net of any anti-dumping duty previously paid,
calculated on the basis of the minimum import price.

17.4.2007

EN

Official Journal of the European Union

L 100/13

CN code and presentation of strawberries

Strawberries uncooked or cooked by
steaming or boiling in water, frozen,
added sugar or other
containing
sweetening matter with
sugar
content exceeding 13 % by weight
(CN 0811 10 11)

a

Strawberries uncooked or cooked by
steaming or boiling in water, frozen,
added sugar or other
containing
a
sweetening matter with
sugar
content
13 % by
exceeding
not
weight (CN 0811 10 19)

Strawberries uncooked or cooked by
steaming or boiling in water, frozen,
not containing added sugar or other
sweetening matter (CN 0811 10 90)

Minimum import price
EUR/tonne net product
weight

Fixed duty EUR/tonne net
product weight, applicable to
Dandong Junao Foodstuff
(TARIC additional code
A780)

Fixed duty EUR/tonne net
product weight, applicable to
all other companies (TARIC
additional code A999)

496,8

62,6

169,9

566,3

71,3

193,7

598

75,3

204,5

5.
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
to Article 145 of Commission Regulation
value pursuant
(EEC) No 2454/93 (1),
the amount of anti-dumping duty,
calculated on the basis of paragraphs 3 and 4 above, shall be
reduced by a percentage which corresponds to the apportioning
of the price actually paid or payable.

Article 2

Amounts secured by way of provisional anti-dumping duty
to Regulation (EC) No 1551/2006 on imports of
pursuant
strawberries, uncooked or cooked by steaming or boiling in
water,
frozen, whether or not containing added sugar or
other sweeteners and originating in the People's Republic of
China, shall be released.

Unless otherwise

6.
concerning customs duties shall apply.

specified,

the provisions

in force

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 Luxembourg, 16 April 2007.

For the Council
The President

Horst SEEHOFER

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

lation (EC) No 214/2007 (OJ L 62, 1.3.2007, p. 6).