2007/430/EC: Commission Decision of 19 June 2007 terminating the anti-dumping proceeding concerning imports of synthetic staple fibres of polyesters (PSF) originating in Malaysia and Taiwan and releasing the amounts secured by way of the provisional duties imposed
Date: 2007-06-19
Institutions: European Commission
Subjects: Malaysia, Taiwan, anti-dumping legislation, import, man-made fibre, originating product

L 160/30

EN

Official Journal of the European Union

21.6.2007

COMMISSION DECISION

of 19 June 2007

terminating the anti-dumping proceeding concerning imports of synthetic staple fibres of polyesters
(PSF) originating in Malaysia and Taiwan and releasing the amounts secured by way of the
provisional duties imposed

(2007/430/EC)

THE COMMISSION OF THE EUROPEAN COMMUNITIES,

Having regard to the Treaty
Community,

establishing the European

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

After consulting the Advisory Committee,

Whereas:

(1)

(2)

(3)

A. PROCEDURE

On 3 March 2006, the Commission received a complaint
pursuant to Article 5 of the basic regulation concerning
injurious dumping of imports of synthetic staple fibres of
polyesters (PSF) originating in Malaysia and Taiwan. The
complaint was lodged by CIRFS (Comité International de
la Rayonne et des Fibres Synthétiques) representing more
than 50 % of the total Community production of PSF.

Following the initiation of an anti-dumping investigation
the Commission, by Regulation
on 12 April 2006,
(EC) No 2005/2006 (2),
anti-
imposed provisional
dumping duties on imports into the Community of
synthetic staple fibres of polyesters (‘PSF’) originating in
and Taiwan (‘provisional Regulation’). The
Malaysia
provisional anti-dumping duties which took the form
of ad valorem duties ranging between 12,4 % and 23 %
for Malaysia and 14,7 % and 29,5 % for Taiwan applied
as of 29 December 2006.

Following the publication of the provisional Regulation,
parties received disclosure of the facts and considerations
on which the provisional Regulation was based. All
parties were granted a period within which to make
presentations subsequent to the disclosures.

(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 379, 28.12.2006, p. 65.

(4)

(5)

(6)

(7)

(8)

(9)

Some interested parties submitted comments in writing.
Those parties who so requested were also granted an
opportunity to be heard orally.

The Commission continued to seek all
deemed necessary for
the purpose of
findings. Based on these findings
conclusion
Community
measures on imports of PSF
concerned.

that
interest not

reasons
to impose

compelling

information it
its definitive
the
it arrived at
on
existed
anti-dumping
countries

from the

the essential

facts and
The Commission disclosed all
considerations on the basis of which it
intended to
terminate the proceeding. The interested parties were
also granted a period within which to make presentations
subsequent to this disclosure and were granted an oppor-
tunity to be heard orally. The written and oral comments
submitted by the interested parties were considered and,
where appropriate, taken into account for the definitive
findings.

Originally, after consultation of the advisory Committee,
the Commission submitted to the Council a report on
the results of the consultation, together with a proposal
that
the proceeding be terminated on grounds of
Community interest.

B. WITHDRAWAL OF THE COMPLAINT AND
TERMINATION OF THE PROCEEDING

In the meantime, by letter dated 23 May 2007 and
addressed to the Commission, the complainant formally
withdrew its complaint
imports of
synthetic staple fibres of polyesters (PSF) originating in
Malaysia and Taiwan.

concerning the

In accordance with Article 9(1) of the basic Regulation,
the proceeding may be terminated where the complaint
is withdrawn unless such termination would not be in
the Community interest.

(10)

The Commission considered that the present proceeding
should be terminated since the investigation had not
brought to light any considerations showing that such
termination would not be in the Community interest.

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Official Journal of the European Union

L 160/31

(11)

(12)

(13)

the

during

investigation the Commission
Indeed,
contacted all parties known to be concerned to obtain
their views. In addition to the Community industry, users
and users associations made submissions and/or have
been heard concerning the possible impact of the impo-
sition of definitive measures. Based on these new
findings, the Commission arrived at the conclusion that
compelling reasons exist on grounds of Community
interest not
anti-dumping measures on
imports of PSF from the countries concerned. An appre-
ciation of the various interests taken as a whole was
made on the basis of the arguments explained below.

to impose

Impact on importers and users

Indeed, following the imposition of provisional measures,
one importer, a large number of users and users as-
sociations came forward and claimed that the level of
the measures was particularly high and that they were,
as a consequence, prevented from importing from their
largest sources of supply in Asia. They confirmed the
arguments already put
forward by other users before
the imposition of provisional measures, described in
recitals 156 to 158 of the provisional Regulation, and
made new claims.

in the

cooperate

industries,

raised by users'

In order to examine in detail the relevance of the new
issues
the Commission
requested the parties to provide data and supporting
evidence encouraging all users and their associations to
further
investigation. Cooperation
increased compared to the situation before the impo-
sition of provisional measures, as users representing
total Community consumption of PSF
over 10 % of
imports from the countries
and about 15 % of
concerned cooperated in the investigation. The partici-
pation of major users associations in the investigation
(representing companies that account
for more than
50 % of total consumption of PSF in the Community)
was also taken into consideration, thereby confirming
that the findings and conclusions reached on the need
to terminate the investigation on grounds of Community
interest were sufficiently substantiated.

total

(14) According to users,

the imposition of measures will
aggravate the shortages of PSF supply because the
Community industry is not able to satisfy EU demand.
This situation will also play a role in increasing the price
of PSF and thus prices of products in the downstream
industries, threatening their competitiveness in a market
where low-priced imports of finished products play an
losses in
important
these circumstances,
employment
in the Community industries using PSF
are to be expected in the short term.

role. Under

(a) Shortages of supply

(15)

PSF users claim that they will become more dependent
on imports from a very limited number of producers in
supply offered by
as
other

countries

third

the

La

Terephthalate

Community producers in general for all types of PSF is
deteriorating. This is due to the industrial conversion of
Community producers from PSF to other products. For
example,
reduced its
Seda de Barcelona has
production of PSF in order to increase its output of
Polyethylene
the
production problems caused by the fire in Trevira in
December 2006 and the financial difficulties of Tergal
(under administration due to insolvency (‘procedure de
sauvegarde’) since November 2006) which was the most
reliable supplier of PSF for the spinning industry are
aggravating the supply problems. Finally,
it must be
recalled that one of the Community producers (Pennine
Fibres) went bankrupt.

Similarly,

(PET).

(16) Users, mainly bedding and upholstering material manu-
in particular for the

facturers fear serious shortages,
following fibres used in the non-woven industry (1):

1. HCS (hollow conjugated siliconised) for which only
one Korean producer
from the Taiwanese
(apart
suppliers) is able to deliver large quantities within a
reasonable period of time;

2. LMP: Allegedly, only one firm in Korea would be able

to supply that fibre in rather large quantities.

(17)

(18)

Community

the additional data supplied by one co-
Furthermore,
provisional
after
operating
disclosure show that
the types of PSF sold by the
Community industry and the imported types of PSF
from Malaysia and Taiwan are different.

producer

it

is difficult

Community users also claimed that
to
switch to other sources of supply, notably in third
countries not subject to anti-dumping measures. It was
argued that it takes time for exporting producers of PSF
to resume their exports to the Community, especially in
the light of the risk that duties would be re-introduced as
soon as their import volumes reached a certain volume
level. Moreover, even if users were able to purchase PSF
from new suppliers located in other countries, they need
to test whether the types of PSF manufactured by these
producers are suitable for their specific productions. In
any event, users stated that there are no producers in the
Community or in third countries not subject to anti-
dumping measures which have the requested capacities
to supply enough of
the specific fibres produced in
Taiwan.

(1) This is confirmed by independent sources. It is indeed stated in the
August 2006 PCI report at page 16 that
the
European industry is unable to replicate the offering of the East
Asian Industry-particularly in the low melt and bicomponents
sector- and this will remain an area of vulnerability for European
textile companies’.

‘In certain cases,

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Official Journal of the European Union

21.6.2007

(19)

(20)

(21)

(22)

The available Eurostat figures show that imports from
Indonesia, Thailand and India, for which anti-dumping
measures were repealed as from the end of October
2006, have increased rapidly in relative term up to the
end of 2006. This may suggest that other sources of
supply are already available in the Community market.
However, the volume concerned is still relatively low and
they cannot respond rapidly to the users' demand. It is
therefore very likely that,
if measures are imposed on
imports from Taiwan and Malaysia, users will have to
order a large share of
from countries
their
subject to anti-dumping duties.

fibres

In relation to the argument raised in recital 158 of the
provisional Regulation regarding the limited capacity of
the Community industry compared to the needs of
Community users of PSF, the Community industry did
not offer any comment. The evidence indicates that the
Community industry and other Community producers
are not in a position to make the necessary efforts to
satisfy the Community demand. Moreover, the investi-
gation carried out after the imposition of provisional
measures has shown that Community users are running
into serious difficulties when trying to obtain certain
types of PSF from third countries not subject to anti-
dumping measures.

There are also indications showing that the increased
demand in other third countries of certain types of PSF
not available in the Community has already led to price
increases. The other sources of supply are therefore also
affected by the situation created by imposition of
measures.

other suppliers located in Korea and in India. The fact
that the demand has increased compared to available
sources
anti-dumping
measures also led to increase the price of PSF on the
Community market.

subject

supply

not

to

of

in other

(24) Users provided information showing price increases in
specialty fibres offered by suppliers
third
countries following the imposition of provisional anti-
dumping measures on imports originating in Taiwan
that Community users cannot
and Malaysia. The fact
fully rely on Community suppliers for certain types of
PSF or on others established in other third countries not
subject to anti-dumping measures,
is likely to lead to
further price increases in the short term.

(c) Cost impact of the proposed measures

(25)

The further analysis carried out on the possible impact of
the imposition of measures revealed that the bedding and
upholstering industry may probably be more sensitive to
possible raw material price increases than the spinning
sector. Manufacturers of pillows,
cushions,
upholstery etc. have a profit margin below 5 % on
average and PSF accounts for up to 30 % of their total
cost of production. Given that they are the main users of
LMP and HCS for which the alleged shortage of supply in
the Community is likely to worsen with the imposition
of measures,
costs of
production may be as high as 6-8 %.

likely impact on their

quilts,

the

Based on the above, even if there are some alternative
sources of supply which are available to Community
users, and in spite of the fact that new plants of PSF
would have been installed recently (1) and the capacity
in Trevira would have been restored by the end of March
2007, the supply of PSF may remain problematic in the
Community market.

(26)

It is clear that with such an increase in costs, the bedding
industry will be seriously affected by the increasing
competition they are facing from China on finished
products and they will not be able to make attractive
to their clients, namely the large chains of
offers
retailers with an extremely strong buyer market power.
A decision to impose anti-dumping duties on imports
from Malaysia and Taiwan will
lead to further weaken
their competitiveness.

(b) Price increases for PSF

(23)

Community users of PSF claimed that
following the
imposition of provisional measures, they are suffering
from significant price increases for certain types of PSF
not only from the countries concerned but also from

(27)

(1) According to the claims made by the Community industry, new
plants of PSF have been installed in Poland, Romania and Bulgaria
in 2006. However, no data have been provided on whether this
would lead to an increase in capacity compared to the situation
during the IIP. No indications have been supplied either on the
evolution of the capacity of the EU industry in correlation to the
evolution of demand.

It was concluded in recital 164 of the provisional Regu-
lation that the impact of the proposed measures on the
downstream industry will be limited. Based on the above
facts and considerations, the further investigation showed
that on average the costs increase of users will be in a
range of 0,4-1,5 % and can attain 6 %-8 % in the bedding
industry,
in particular in the case of users that obtain
most of their PSF from Taiwan. Thus, the impact will
not be evenly spread on the users and the economic
situation of certain users will be seriously affected.

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Official Journal of the European Union

L 160/33

(d) Price increases for downstream products

(28) Users

should the

also claimed that

anti-dumping
measures be maintained at the current level on imports
originating in Taiwan and Malaysia, it is inevitable that
increase in the
prices for downstream products will
Community market. This
in turn would trigger an
increase in imports of low-priced downstream products
and add to the problems encountered by the users
industries. Recent statistics clearly show that after anti-
dumping measures were imposed on imports of PSF
from China import volumes of certain ready goods incor-
porating PSF (1) increased by 39 %.

(29)

(30)

It is true that there has been a correlation between the
imposition of anti-dumping measures on Chinese PSF
imports of downstream products
and the increase of
from China. The statistics show that
this is not an
isolated situation and past anti-dumping measures on
PSF from various third countries have lead to the same
reaction from the countries concerned. Either the price
increases of PSF will be borne fully by consumers of
downstream products or
in
employment in the Community downstream industry if
they cut their production due to increased imports from
third countries.

there will

cuts

be

(e) Consequences for employment in the Community market

for

PSF

employment

The investigation showed that the production of PSF is
not a labour intensive activity. The Community industry
employs less than 700 people in the Community and
total
the
Community is less than 3 000 jobs. Since, as indicated
above, most of the PSF types sold by the Community
industry are different from the types of imported PSF
from Malaysia and Taiwan, and taking into account
that demand of PSF in the Community is
steadily
increasing,
it is not considered that many jobs are at
risk if definitive measures are not imposed.

production

in

(31) However, according to the figures provided to the
Commission, users accounting for around 10 % of
Community PSF consumption employ more than 7 000
people in the manufacture of products incorporating PSF.
It can therefore be assumed that around 70 000 jobs
depend on the users’
industry in the present case and
at
least 10 % are in the bedding and upholstering
industry which, as indicated above, has very low profit
margins and is the main user of LMP and HCS fibres.
Moreover, based on the share of labour costs on the cost
of production of the users’ industries, it was found that
an average cost impact of 1 % is equivalent to 2,5 % to

(1) Articles of bedding and similar
cushions, pouffes and pillows)
feathers whether or not covered (CN code 9404 90 90).

furnishings (quilts, eiderdowns,
than

fitted with other material

7,75 % labour costs. Accordingly, the imposition of de-
finitive measures may lead to substantial job losses in the
short term in the Community downstream industry to
compensate
increase or
the raw material
following the likely shutdown or decrease of production
in the bedding industry.

cost

for

Impact on the Community industry

(32)

Impact on the Community industry was also analysed
before they withdrew their complaint. The information
available showed that Community producers are not
supplying all users in the Community with the quantities
and types of PSF requested.

(33)

Furthermore, the investigation showed that the level of
investment by the Community industry was low for a
capital intensive activity and producers preferred to invest
in other products such as PET.

Impact on suppliers of raw materials

(34) As indicated in recital 166 of the provisional Regulation,
only one provider of raw material cooperated in the
investigation. He expressly supported the imposition of
duties, which would allow the Community industry to
remain viable and would also secure its own position. He
did not provide information concerning the impact of
imposition or non-imposition of measures on his
business.

Impact on the environment

(35)

that

failure

recycling sector

It was argued by the Community industry, which
allegedly produces 40 % of PSF from recycled PET
bottles, and by one association of producers active in
the
to take definitive
measures on dumped PSF imports from Malaysia and
Taiwan will
the Community
industry to convert waste bottles into PSF. Also, they
argued that the non-imposition of measures will have a
negative impact on the environment since it will increase
the emissions of CO2 if the recycling industry were to
ship outside Europe the plastic wastes it sells now to the
Community producers of PSF.

reduce the capacity of

(36)

First, it has to be pointed out that a substantial amount
of the fibres imported from the countries concerned are
LMP or used by the spinning industry and, according to
the information available at this stage, LMP and most of
the fibres used for the spinning industry need to be made
from virgin material.

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Official Journal of the European Union

21.6.2007

(37)

(38)

(39)

(40)

is

there

Second, according to the evidence submitted to the
Commission,
and growing
recycled PET bottles from Asia and the
demand of
anti-dumping measures will not
non-imposition of
their
PET bottle
preclude
products on the world market.

an important

from selling

recyclers

Finally to the extent that the arguments on CO2 could
it has been put
play a role in trade defence policy,
forward for the first time one year after the initiation
of the present procedure, which makes it impossible to
duly verify its veracity.

(42)

Interested parties were informed accordingly and were
given the opportunity to comment.

(43)

is

that

therefore

concluded

anti-dumping
It
proceeding, concerning imports into the Community of
synthetic staple fibres of polyesters (PSF) originating in
Malaysia and Taiwan should be terminated without the
imposition of anti-dumping measures.

the

(44) Any duties provisionally secured on the basis of Regu-

lation (EC) No 2005/2006 should be released,

Conclusion on Community interest

HAS DECIDED AS FOLLOWS

Taking into account the submissions made by the various
parties and the results of the investigation, it is concluded
that the imposition of definitive anti-dumping measures
against dumped imports of PSF originating in Malaysia
and Taiwan will impact significantly on the Community
users. The conclusion, as set out in recital 168 of the
provisional Regulation, cannot therefore be confirmed.

The overall advantages to be gained by the Community
industry must be weighted against the probable disad-
vantages, in particular for users and, to some extent for
consumers. The volume and the variety of supply offered
by Community producers are deteriorating. This is due,
among other reasons,
to the industrial conversion of
Community producers from PSF to other products (for
example la Seda de Barcelona) and the financial diffi-
culties of Tergal. There is a supply problem in the
Community market for certain types of fibres and the
Community producers cannot or are not willing to make
the necessary efforts to meet the demand. Furthermore, it
is likely that
lead to
substantial price increases of certain types of PSF which
are not
in the
in sufficient
Community. Moreover, account should be taken of the
fact that certain users of PSF (in particular the bedding
industry) have very low profit margins and will have to
pass on to consumers any price increase in PSF or
abandon their activities in case competition from third
countries would not allow them to increase their prices.

the imposition of duties will

quantities

available

Article 1

The anti-dumping proceeding concerning imports of synthetic
staple fibres of polyesters, not carded, not combed or otherwise
processed for spinning,
falling within CN code 5503 20 00,
originating in Malaysia and Taiwan is hereby terminated.

Article 2

Regulation (EC) No 2005/2006 is hereby repealed.

Article 3

The amounts secured by way of provisional anti-dumping duty
imposed pursuant to Regulation (EC) No 2005/2006 shall be
released.

Article 4

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

Done at Brussels, 19 June 2007.

(41) Having regard to the above, it cannot be concluded that,
following the withdrawal of the complaint, termination
would not be in the Community interest.

For the Commission

Peter MANDELSON
Member of the Commission