Proposal for a Council Regulation imposing a definitive anti-dumping duty on imports of silico-manganese originating in the People’s Republic of China and Kazakhstan and terminating the proceeding on imports of silico-manganese originating in Ukraine
Date: 2007-11-09
Institutions: European Commission
Subjects: China, Kazakhstan, Ukraine, anti-dumping duty, anti-dumping legislation, import, metallic ore, originating product

COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 9.11.2007 
COM(2007) 702 final 

Proposal for a 

COUNCIL REGULATION 

imposing a definitive anti-dumping duty on imports of silico-manganese originating in 
the People’s Republic of China and Kazakhstan and terminating the proceeding on 
imports of silico-manganese originating in Ukraine  

(presented by the Commission) 

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EXPLANATORY MEMORANDUM 

1)  CONTEXT OF THE PROPOSAL 

•  Grounds for and objectives of the proposal 

This  proposal  concerns  the  application  of  Council  Regulation  (EC)  No  384/96  of 
22 December 1995 on protection against dumped imports from countries not members 
of  the  European  Community,  as  last  amended  by  Council  Regulation  (EC) 
No 2117/2005 of 21 December 2005 (‘the basic Regulation’). 

•  General context 

This proposal is made in the context of the implementation of the basic Regulation and 
is the result of an investigation which was carried out in line with the substantive and 
procedural requirements laid out in the basic Regulation. 

•  Existing provisions in the area of the proposal 

Not applicable. 

•  Consistency with other policies and objectives of the Union 

Not applicable. 

2)  CONSULTATION OF INTERESTED PARTIES AND IMPACT ASSESSMENT 

•  Consultation of interested parties 

Interested  parties  concerned  by  the  proceeding  have  already  had  the  possibility  to 
defend their interests during the investigation, in line with the provisions of the basic 
Regulation. 

•  Collection and use of expertise 

There was no need for external expertise. 

•  Impact assessment 

This proposal is the result of the implementation of the basic Regulation. 

The  basic  Regulation  does  not  foresee  a  general  impact  assessment  but  contains  an 
exhaustive list of conditions that have to be assessed. 

3)  LEGAL ELEMENTS OF THE PROPOSAL 

•  Summary of the proposed action 

On  6  September  2006,  the  Commission  initiated  an  anti-dumping  proceeding 
concerning imports of silico-manganese originating in the People’s Republic of China, 
Kazakhstan and Ukraine. 

No  provisional  measures  were  imposed  in  this  case  due  to  the  need  to  deepen  the 
analysis  of  dumping,  causation  and  Community  interest.  The  investigation  found 
dumping of the product concerned, which caused injury to the Community industry in 

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the case of imports from Kazakhstan and the PRC. In the case of Ukraine, despite the 
existence  of  dumping,  the  average  injury  margin  was  below  de minimis.  The 
investigation  also  evidenced  that there was no compelling Community interest aspect 
against  the  imposition  of  definitive  anti-dumping  measures.  On  this  basis,  it  is 
proposed to impose definitive measures in the case of Kazakhstan and the PRC and to 
terminate the proceeding in respect of Ukraine. 

Therefore,  it  is  suggested  that  the  Council  adopts  the  attached  proposal  for  a 
Regulation. 

•  Legal basis 

Council  Regulation  (EC)  No  384/96  of  22 December  1995  on  protection  against 
dumped  imports  from  countries  not  members  of  the  European  Community,  as  last 
amended by Council Regulation (EC) No 2117/2005 of 21 December 2005. 

•  Subsidiarity principle 

The proposal falls under the exclusive competence of the Community. The subsidiarity 
principle therefore does not apply. 

•  Proportionality principle 

The proposal complies with the proportionality principle for the following reasons: 

The form of action is described in the above-mentioned basic Regulation and leaves no 
scope for national decision. 

Indication  of  how  financial  and  administrative  burden  falling  upon  the  Community, 
national governments, regional and local authorities, economic operators and citizens is 
minimized and proportionate to the objective of the proposal is not applicable. 

•  Choice of instruments 

Proposed instrument: Regulation. 

Other means would not be adequate for the following reason: 

Other  means  would  not  be  adequate  because  the  basic  Regulation  does  not  foresee 
alternative options. 

4)  BUDGETARY IMPLICATION 

The proposal has no implication for the Community budget. 

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Proposal for a 

COUNCIL REGULATION 

imposing a definitive anti-dumping duty on imports of silico-manganese originating in 
the People’s Republic of China and Kazakhstan and terminating the proceeding on 
imports of silico-manganese originating in Ukraine  

THE COUNCIL OF THE EUROPEAN UNION, 

Having regard to the Treaty establishing the European Community, 

Having  regard  to  Council  Regulation  (EC)  No  384/96  of  22  December  1995  on  protection 
against dumped imports from countries not members of the European Community1 (‘the basic 
Regulation’), and in particular Article 9 thereof, 

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

Whereas: 

1. 

Initiation 

A. 

PROCEDURE 

(1) 

(2) 

(3) 

On 6 September 2006, pursuant to Article 5 of the basic Regulation, the Commission 
announced by a notice (‘notice of initiation’) published in the Official Journal of the 
European Union2, the initiation of an anti-dumping proceeding with regard to imports 
into the Community of silico-manganese (including ferro-silico-manganese) (‘SiMn’) 
originating in the People’s Republic of China (‘PRC’), Kazakhstan and Ukraine (‘the 
countries concerned’). 

The  proceeding  was  initiated  following  a  complaint  lodged  on  24  July  2006  by  the 
Comité  de  Liaison  des  Industries  de  Ferro-Alliages  (EUROALLIAGES)  ('the 
complainant')  on  behalf  of  producers  representing  a  major  proportion,  in  this  case 
more  than  50  %  of  the  total  Community  production  of  SiMn  (‘the  complainant 
producers’).  The  complaint  contained  prima  facie  evidence  of  dumping  of  SiMn 
originating  in  the  countries  concerned  and  of  material  injury  resulting  therefrom, 
which was considered sufficient to justify the initiation of a proceeding. 

One  interested  party  claimed  that  the  Commission  should  have  initiated  this 
proceeding also against imports originating in India. At the time of the initiation of the 
current  proceeding,  however,  the  Commission  did  not  have  sufficient  evidence  of 
injurious  dumping  at  its  disposal  that  would  have  justified  the  initiation  of  a 
proceeding against imports originating in India in line with the requirements of Article 
5(2) of the basic Regulation. 

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2 

OJ  L  56,  6.3.1996,  p.  1.  Regulation  as  last  amended  by  Council  Regulation  (EC)  No  2117/2005  (OJ 
L 340, 23.12.2005, p. 17). 
OJ C 214, 6.9.2006, p. 14. 

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(4) 

(5) 

(6) 

(7) 

(8) 

2. 

Parties concerned by the proceeding 

The  Commission  officially  advised  the  complainant,  the  complainant  producers  and 
other  known  Community  producers,  exporting  producers  in  the  countries  concerned, 
importers/traders  and  their  associations,  suppliers  and  users  known  to  be  concerned 
and  the  representatives  of  the  exporting  countries  concerned,  of  the  initiation  of  the 
proceeding. Interested parties were given the opportunity to make their views known 
in writing and to request a hearing within the time limit set in the notice of initiation. 
All interested parties, who so requested and showed that there were particular reasons 
why they should be heard, were granted a hearing. 

In order to allow exporting producers in the PRC and in Kazakhstan to submit a claim 
for  market  economy  treatment  (‘MET’)  or  individual  treatment  (‘IT’),  if  they  so 
wished,  the  Commission  sent  claim  forms  to  the  exporting  producers  known  to  be 
concerned  as  well  as  to  the  authorities  of  the  PRC  and  Kazakhstan.  Four  exporting 
producer groups in the PRC and one exporting producer in Kazakhstan claimed MET 
pursuant  to  Article  2(7)  of  the  basic  Regulation,  or  IT  should  the  investigation 
establish that they did not meet the conditions for MET. 

In view of the apparent large number of exporting producers in the PRC and importers 
in  the  Community,  sampling  was  envisaged  in  the  notice  of  initiation  for  the 
determination  of  dumping  and  injury,  in  accordance  with  Article  17  of  the  basic 
Regulation. 

In  order  to  enable  the  Commission  to  decide  whether  sampling  would  be  necessary 
and,  if  so,  to  select  a  sample,  all  exporting  producers  in  the  PRC  and  Community 
importers  were  requested  to  make  themselves  known  to  the  Commission  and  to 
provide,  as  specified  in  the  notice  of  initiation,  basic  information  on  their  activities 
related to the product concerned during the period of 1 July 2005 to 30 June 2006. 

As  far  as  the  exporting  producers  in  the  PRC  are  concerned,  given  that  only  four 
groups  of  companies  having  export  sales  of  SiMn  to  the  Community  during  the  IP 
indicated their willingness to be included in the sample, it was decided that sampling 
was not necessary. 

(9)  With regard to importers into the European Community, only two unrelated importers 
made  themselves  known  and  provided  the  requested  information  in  due  time. 
Therefore, it was decided that sampling was not necessary.  

(10)  The  Commission  sent  questionnaires  to  all  parties  known  to  be  concerned  and  to  all 
other companies that made themselves known within the deadlines set out in the notice 
of  initiation.  Questionnaire  replies  were  received  from  four  Community  producers, 
four exporting producer groups in the PRC, the sole Kazakh exporting producer, three 
Ukrainian exporting producers, two unrelated importers and nine unrelated users in the 
Community.  In  addition,  two  users  submitted  comments  without  replying  to  the 
questionnaire. 

(11)  One  of  the  exporting  producer  groups  in  the  PRC,  however,  subsequently  did  not 
agree to an envisaged on-spot verification of the information provided in their MET/IT 
claims  and  questionnaire  replies.  Consequently,  after  having  advised  the  companies 
concerned of the consequences of non-cooperation as stipulated in Article 18(1) of the 
basic Regulation, the Commission has in accordance with the provisions of Article 18 
considered  the  said  companies  as  not  co-operating  in  the  proceeding  and  all 
submissions made by them have been disregarded.  

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(12)  The Commission sought and verified all the information it deemed necessary for the 
purpose of MET/IT, in the case of the PRC and Kazakhstan, and for the determination 
of  dumping,  resulting  injury  and  Community  interest  for  all  countries  concerned. 
Verification visits were carried out at the premises of the following companies: 

(a) Community producers 

– 

– 

– 

– 

Eramet Comilog Manganese, Paris, France 

Ferroatlantica S.L., Madrid, Spain 

Huta Łaziska SA, Łaziska Górne, Poland 

OFZ, a.s., Istebne, Slovakia. 

(b) Users in the Community 

– 

Compañía Española de Laminación, S.L., Castellbisbal, Spain 

–  Mittal Steel Poland SA (Arcelor SA), Kraków, Poland. 

(c) Unrelated importers 

–  Metalleghe S.P.A., Brescia, Italy. 

(d) Exporting producers in the PRC 

–  Minmetals Group 

–  Minmetals (Guizhou) Ferro-Alloys Co., Ltd., Guiyang 

– 

– 

Guiyang Huaxi Minmetals Ferro-Alloys Co., Ltd., Qingzhen 

China Minmetals Shenzhen Co., Ltd., Shenzhen 

–  Minmetals Shanghai Pudong Trading Co., Ltd., Shanghai 

– 

China National Minerals Co., Ltd., Beijing 

–  Minmetals Orient Import & Export Trading Co., Ltd., Beijing. 

– 

Jilin Group 

– 

– 

Jilin Ferroalloys Co., Ltd., Jilin City 

Jilin Ferroalloy Imp & Exp Co., Ltd., Jilin City. 

– 

Shanxi Jinneng Group 

– 

– 

– 

– 

Shanghai Jinneng International Trade Co. Ltd., Shanghai 

Datong Jinneng Jinli Ferroalloy Co. Ltd., Datong 

Shanxi Jinneng Group Jinguan Ferroalloy, Datong 

Datong Jinneng Industrial Silicon Co. Ltd., Datong. 

(e) Exporting producer in Kazakhstan 

– 

OJSC Kazchrome ('Kazchrome'), Aktyubinsk and Aksu. 

(f) Exporting producers in Ukraine 

– 

PJSC Nikopol Ferroalloys Plant ('NFP'), Nikopol and its related traders 

– 

– 

SPIG 'Interpipe' Corporation, Dniepopetrovsk 

Nikopolskie Ferrosplavy LLC, Dniepopetrovsk 

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– 

– 

JSC Stakhanov Ferroalloys Plant ('Stakhanov'), Stakhanov 

OJSC Zaporozhye Ferroalloys Plant ('Zaporozhye'), Zaporozhye. 

(g) Related traders in Switzerland  

– 

– 

Steelex SA, Lugano, related to PJSC Nikopol Ferroalloys Plant 

ENRC, Kloten, related to OJSC Kazchrome. 

(13) 

In light of the need to establish a normal value for the exporting producers in the PRC 
and Kazakhstan to which MET might not be granted, a verification to establish normal 
value on the basis of data from an analogue country took place at the premises of the 
following  producer  and  its  related  sales  company  in  the  United  States  of  America 
("USA"): 

– 

– 

Eramet Marietta, Inc., Marietta, Ohio (producer) 

Eramet  North  America,  Inc.,  Coraopolis,  Pennsylvania  (related  sales 
company). 

3. 

Investigation period  

(14)  The  investigation  of  dumping  and  injury  covered  the  period  from  1  July  2005  to 
30 June 2006  (‘the  investigation  period’  or  ‘IP’).  The  examination  of  trends  relevant 
for the assessment of injury covered the period from 1 January 2002 to the end of the 
investigation period (‘period considered’). 

B. 

PRODUCT CONCERNED AND LIKE PRODUCT  

1. 

Product concerned 

(15)  The  product  concerned 

is  silico-manganese  (including  ferro-silico-manganese) 
(‘SiMn’) originating in the PRC, Kazakhstan and Ukraine (‘the product concerned’), 
normally declared under CN codes 7202 30 00 and ex 8111 00 11. 

(16)  The product concerned is used in the steel industry for deoxidization and as an alloy. It 
is  mainly  produced  from  manganese  ore  and  silicon  which  are  mixed  together  and 
brought to fusion temperatures in a furnace.  

(17)  SiMn  exists  in  different  qualities  and  it  can  have  different  content  of  iron  (Fe), 
manganese  (Mn),  silicon  (Si)  and  carbon  (C).  As  far  as  the  carbon  content  is 
concerned, a distinction can be made between SiMn with a very low content of carbon, 
which is of a higher quality (and attracts a higher price), and SiMn with higher carbon 
content,  which  can  be  considered  as  the  normal  quality.  SiMn  is  sold  in  different 
powder,  grain  or  lump  sizes.  Despite  these  differences,  all  qualities  and  sizes  have 
been  considered  as  a  single  product  since  they  share  the  same  main  chemical  and 
physical characteristics and main uses. 

2. 

Like product 

(18)  The  investigation  showed  that  SiMn  produced  and  sold  in  the  Community  by  the 
Community  industry,  SiMn  produced  and  sold  on  the  domestic  markets  of  PRC, 
Kazakhstan  and  Ukraine,  and  on  the  domestic  market  of  the  USA,  which  finally 
served as an analogue country, and SiMn imported into the Community from the PRC, 
Kazakhstan  and  Ukraine,  have  essentially  the  same  basic  chemical  and  physical 
characteristics  and  the  same  basic  uses.  They  are  therefore  considered  to  be  alike 
within the meaning of Article 1(4) of the basic Regulation. 

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(19)  One exporting producer claimed that unwrought manganese, normally declared under 
CN code 8111 00 11, should not be covered by the investigation. In this regard, it is 
confirmed that the product concerned is silico-manganese, as stated at recital (15) and 
not  unwrought  manganese,  but  it  also  includes  unwrought  silico-manganese.  While 
SiMn is generally declared under CN code 7202 30 00, it may also, depending on the 
iron content, be declared as unwrought silico-manganese or silico-manganese powders 
under CN code 8111 00 11.  

1.  Market Economy Treatment (‘MET’) 

C. 

DUMPING 

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

1) 

2) 

3) 

4) 

5) 

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

firms have one clear set of basic accounting records, which are independently 
audited  in  line  with  international  accounting  standards  and  are  applied  for  all 
purposes; 

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

bankruptcy and property laws guarantee stability and legal certainty; 

exchange rate conversions are carried out at market rates.  

(21)  Four  groups  of  Chinese  exporting  producers  initially  requested  MET  pursuant  to 
Article  2(7)(b)  of  the  basic  Regulation  and  replied  to  the  MET  claim  form  for 
exporting producers within the given deadlines. However, one of these groups decided 
subsequently  not  to  co-operate  with  the  investigation  (as  mentioned  in  recital  (11) 
above).  Thus,  only  the  MET  claims  of  the  remaining  three  co-operating  Chinese 
exporting producer  groups  listed in  recital (12) were considered. All  of these  groups 
included  both  producers  of  the  product  concerned  and  companies  related  to  the 
producers  and  involved  in  the  sales  of  the  product  concerned.  Indeed,  it  is  the 
Commission’s consistent practice to examine whether a group of related companies as 
a whole fulfils the conditions for MET.  

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

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

1.1.  MET determination regarding exporting producers in the PRC 

(24)  The  investigation  revealed  that  MET  could  not  be  granted  to  any  of  the  Chinese 
exporting producers listed in recital (12) as none of these groups met criterion 1 set out 

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in Article 2(7)(c) of the basic Regulation and, in addition, one of them failed to meet 
criterion 2 and another one failed to meet criterion 3. Furthermore, for the group not 
meeting  criterion  1  and  2  strong  doubts  remained  with  regard  to  criterion  3  and  this 
group,  in  any  case,  failed  to  submit  a  complete  set  of  MET  claim  forms  and 
questionnaire replies of its related companies involved in the production and/or trading 
of the product concerned. 

(25)  As far as criterion 1 is concerned, none of the Chinese groups of companies concerned 
has demonstrated to fulfil this criterion. All of the groups of companies were found to 
be  ultimately  State  owned  and  failed  to  present  evidence  that  could  be  considered 
sufficient to remove doubts of significant State interference in management decisions. 
Therefore, it could not be excluded that the companies were under a significant State 
control and interference. 

(26)  For one group of companies, in addition to the non-compliance with criterion 1, it was 
established that it could not demonstrate that there are no distortions carried over from 
the  former  non-market  economy  system  (criterion  3),  given  certain  uncompensated 
loan  benefits  one  company  in  the  group  had  received  from  its  State-owned  mother 
company. 

(27)  Furthermore, for another group of companies, in addition to the non-compliance with 
criterion 1, it was established that it could not demonstrate that there are no distortions 
carried over from the former non-market economy system, in particular in view of the 
existence  of  barter  trade  during  the  investigation  period.  This  group  also  failed  to 
demonstrate  that  the  accounts  of  several  of  its  verified  entities  were  independently 
audited  in  accordance  with  international  accounting  standards,  as  the  application  of 
sound  and  basic  accounting  principles,  in  particular  with  regard  to  depreciation  of 
fixed assets, had been overruled by the parent company and this infringement had been 
accepted by the companies' auditors.  

(28)  Moreover, within the same group at least one company which appeared to be involved 
in  trading  of  the  product  concerned  had  submitted  neither  a  MET  claim  form  nor  a 
questionnaire reply, putting in doubt the reliability of the information provided.  

(29)  The  interested  parties  were  given  an  opportunity  to  comment  on  the  above  findings. 
The comments received from two Chinese exporting producer groups did not provide 
any new evidence that would change the findings regarding the MET determination. 

(30)  On  the  basis  of  the  above,  none  of  the  Chinese  exporting  producer  groups  of 
companies have shown that they fulfil all the criteria set out in Article 2(7)(c) of the 
basic Regulation and, thus, could not be granted MET. 

1.2.  MET determination regarding the sole exporting producer in Kazakhstan 

(31)  The sole Kazakh exporting producer showed that it fulfilled all five criteria set out in 
Article 2(7)(c) of the basic Regulation and was therefore granted MET. The exporting 
producer and the Community industry (see recital (91)) were given an opportunity to 
comment on the MET findings. The comments received from the Community industry 
did not provide any new evidence that would change the findings regarding the MET 
determination. 

2. 

Individual treatment (‘IT’) 

(32)  Pursuant  to  Article  2(7)(a)  of  the  basic  Regulation,  a  country-wide  duty,  if  any,  is 
established  for  countries  falling  under  that  Article,  except  in  those  cases  where 

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companies are able to demonstrate that they meet all criteria set out in Article 9(5) of 
the basic Regulation. 

(33)  As  far  as  the  PRC  is  concerned,  all  exporting  producers  who  requested  MET  also 

claimed IT in the event that they would not be granted MET. 

(34)  On  the  basis  of  the  information  available,  it  was  found  that  all  of  the  groups  of 
companies  concerned  failed  to  demonstrate  that  they  cumulatively  met  all  the 
requirements for IT as set forth in Article 9(5) of the basic Regulation. Namely, it was 
established that the companies failed to meet the criterion stipulated in Article 9(5)(c) 
of the basic Regulation that the majority of the shares belong to private persons, since 
as  explained  in  recital  (25),  all  the  companies  were  found  to  be  ultimately  majority 
State owned. Consequently, their claims had to be rejected. 

3.  Normal Value 

3.1.  General methodology  

(i)  Global representativeness  

(35)  As  far  as  the  determination  of  normal  value  is  concerned,  the  Commission  first 
established, in accordance with Article 2(2) of the basic Regulation, for each exporting 
producer  concerned  in  Kazakhstan  and  in  Ukraine,  whether  its  domestic  sales  of  the 
product concerned to independent customers were representative, i.e. whether the total 
volume  of such sales represented  at least 5  % of its total export sales volume of  the 
product concerned to the Community. 

(ii)  Comparison of product types 

(36)  The Commission subsequently identified those product types sold domestically by the 
exporting producers having overall representative domestic sales, which were identical 
or directly comparable with the types sold for export to the Community. 

(iii)  Product type specific representativeness 

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

(iv)  Ordinary course of trade test 

(38)  The  Commission  subsequently  examined  for  each  exporting  producer  concerned  in 
Kazakhstan  and  in  Ukraine  whether  the  domestic  sales  of  each  product  type  sold 
domestically  in  representative  quantities  could  be  regarded  as  being  sold  in  the 
ordinary  course  of  trade  pursuant  to  Article  2(4)  of  the  basic  Regulation.  This  was 
done  by  establishing  for  each  exported  product  type  the  proportion  of  profitable 
domestic sales to independent customers during the IP. 

(39)  For  those  product  types  where  more  than  80  %  by  volume  of  sales  on  the  domestic 
market  were  not  below  unit  costs  and  where  the  weighted  average  sales  price  was 
equal to or higher than the weighted average production cost, normal value, by product 
type, was calculated as the weighted average of all domestic sales prices of the type in 
question. 

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

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

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

(43)  Normal value was constructed by adding to each exporter’s manufacturing costs of the 
exported types, adjusted where necessary, a reasonable amount for selling, general and 
administrative expenses ('SG&A') and a reasonable margin of profit. 

(44) 

In  all  cases  SG&A  and  profit  were  established  pursuant  to  the  methods  set  out  in 
Article 2(6) of the basic Regulation. To this end, the Commission examined whether 
the  SG&A  incurred  and  the  profit  realised  by  each  of  the  exporting  producers 
concerned on the domestic market constituted reliable data. 

3.2.  Analogue country  

(45)  According to Article 2(7)(a) of the basic Regulation, in economies in transition normal 
value for exporting producers not granted MET has to be established on the basis of 
the price or constructed value in a market economy third country ('analogue country') 
or  the  price  from  such  a  third  country  to  other  countries,  or  where  those  are  not 
possible, on any other reasonable basis. 

(46) 

In  the  notice  of  initiation,  it  was  envisaged  to  use  Brazil  as  an  appropriate  analogue 
country  for  the  purpose  of  establishing  normal  value  for  the  PRC  and  Kazakhstan, 
where necessary, and interested parties were invited to comment on this. No interested 
parties objected to this proposal. 

(47)  The  Commission  sought  co-operation  from  known  producers  in  Brazil  and 
subsequently  also  from  producers  in  other  potential  analogue  countries,  i.e.  India, 
Japan,  Norway,  South  Africa  and  the  USA.  Offers  of  co-operation  were,  however, 
obtained only from producers in Norway and in the USA. On the basis of information 
obtained from three Norwegian companies, it was concluded that the domestic market 
of SiMn in Norway was very small. Therefore, the Norwegian market was not deemed 
sufficiently  representative  for  the  determination  of  normal  value  for  the  PRC  and 
Kazakhstan. 

(48)  As  for  the  sole  known  USA  producer,  a  questionnaire  was  sent  to  that  producer  and 
the data submitted in its reply were verified on the spot. The domestic sales volume of 
the  producer  in  question  in  the  USA  was  found  to  be  significant  and  sufficiently 
representative  in  comparison  to  the  volume  of  Chinese  and  Kazakh  exports  of  the 
product concerned to the Community. Moreover, the USA market can be considered 
an open market, given that the import duty level is low (MFN duty of 3,9 % of FOB 
price). The investigation showed that there were substantial imports of SiMn into the 
USA  market.  Therefore,  the  USA  market  was  deemed  a  competitive  market  and 

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(49) 

sufficiently  representative  for  the  determination  of  normal  value  for  the  PRC  and 
Kazakhstan. 

Interested parties were invited to comment on this and comments were received from 
three interested parties objecting to the choice of the USA as an analogue country. One 
Chinese exporting producer group argued firstly that there is insufficient competition 
on  the  USA  market  since  (i)  the  cooperating  producer  is  the  only  producer  on  the 
domestic  market  and  (ii)  the  volume  of  imports  into  the  USA  market  is  allegedly 
limited due to the existence of anti-dumping measures in the USA on imports of silico-
manganese from main producing countries in the world. Secondly, it claimed that the 
fact that the cooperating USA producer is a related company to one of the complainant 
producers  casts  doubts  on  the  reliability  and  representativity  of  its  cost  and  price 
information.  Thirdly,  it  was  claimed  that  account  should  be  taken  of  the  fact  that 
access to raw materials is allegedly different in the USA, were there are no domestic 
supplies  of  the  main  raw  material,  manganese  ore,  and  the  PRC,  where  domestic 
supplies are available. Fourthly, it was claimed that a country with a level of economic 
development  more  similar  to  that  of  the  PRC  would  constitute  a  more  appropriate 
analogue country than the USA. 

(50)  The Chinese exporting producer claimed that India or, secondarily, Ukraine, would be 
more  appropriate  choices  for  analogue  country,  mainly  because  competition  and 
market conditions in these countries would be more comparable with the situation in 
the  PRC.  As  a  third  option,  it  was  proposed  that  normal  value  for  the  PRC  be 
established on the basis of the data submitted by those Chinese producers that qualify 
for  MET.  Ultimately,  should  the  USA  be  retained  as  an  analogue  country,  it  was 
claimed  that  adjustments  to  the  normal  value  should  be  made  to  account  for 
differences  in  the  access  to  raw  materials  and  differences  in  production  costs  due  to 
higher labour and environmental costs in the USA.  

(51)  The  comments  made  by  two  other  interested  parties  did  not  add  in  substance  to  the 

above-mentioned comments made by the Chinese exporting producer. 

(52)  With  respect  to  India,  the  Commission  had  sought  cooperation  from  several  Indian 
producers, but despite initial positive indications, no cooperation was finally obtained. 
Consequently,  India  could  not  be  retained  as  an  analogue  country.  As  for  Ukraine, 
high  levels  of  dumping  were  found  in  the  investigation  for  that  country  (see  recital 
(87)).  In  line  with  consistent  practice,  a  country  engaged  in  such  dumping  is  not 
considered an appropriate analogue country. As for the third proposal, i.e. to establish 
the normal value for the PRC on the basis of the data submitted by Chinese producers 
qualifying  for  MET,  it  suffices  to  note  that  Article  2(7)(a)  of  the  basic  Regulation 
specifically  sets  out  that  a  "market  economy  third  country"  shall  be  used  and  in 
addition none of the cooperating Chinese producers was found to qualify for MET.  

(53) 

In addition, as regards the specific objections made to the appropriateness of the USA 
as an analogue country, the following should be noted: firstly, as regards the alleged 
lack  of  competition  on  the  local  market,  as  already  mentioned  in  recital  (48),  the 
investigation  showed  that,  albeit  the  cooperating  USA  producer  is  the  sole  local 
producer, there were substantial imports of silico-manganese to the USA. Indeed, the 
imports  during  the  IP  were  manifold  in  comparison  to  the  domestic  sales  volume  of 
the cooperating USA producer. In this connection, it is also noted that the existence of 
trade  defence  measures  in  force  for  the  product  in  question  does  not  preclude  the 
choice of a particular country as an analogue country, as the purpose of anti-dumping 
measures is precisely to restore fair competition on the market in question. 

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(54)  Regarding the allegation that the relationship between the USA cooperating company 
and  a  European  producer  could  affect  the  reliability  of  the  data  provided,  these 
allegations did not coincide with the findings of the investigation. No indication was 
found that the relationship would have had any distorting impact on the prices, costs of 
production  and  profitability  of  the  United  States  producer,  and  the  Commission 
satisfied  itself  on  the  accuracy  and  reliability  of  the  information  provided  for  the 
purposes of this investigation. 

(55)  Finally, the arguments concerning access to raw materials and the difference in costs 
were also considered. The price of the main raw material (manganese ore) used in the 
production  of  silico-manganese  by  the  cooperating  USA  company  was  compared  to 
the  prices  paid  by  the  Chinese  companies  for  manganese  ore  and  no  significant 
differences were found. In addition, it is noted that the Chinese cooperating producers 
also imported part of their manganese ore requirements. The argument, as well as the 
claim for adjustment, was therefore rejected. 

(56)  As  regards  other  factors  invoked,  such  as  the  level  of  economic  development  or  the 
labour  and  environmental  costs,  the  interested  party  failed  to  substantiate  its  claim 
sufficiently, and these factors were not deemed relevant for determining whether the 
USA  is  an  appropriate  analogue  country  nor  to  warrant  an  adjustment  to  the  normal 
value. It is also noted that as costs and prices are in general not considered as a viable 
basis for determining normal value in countries falling under Article 2(7) of the basic 
Regulation, such comparison in fact defeats the purpose of resorting to the methods set 
out in Article 2(7)(a) of the basic Regulation. 

(57) 

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

3.3.  People's Republic of China  

(58)  Following  the  choice  of  the  USA  as  an  analogue  country  and  pursuant  to  Article 
2(7)(a) of the basic Regulation, normal value for Chinese exporting producers, none of 
whom  has  been  granted  MET,  was  established  on  the  basis  of  verified  information 
received from the sole co-operating USA producer. 

(59)  The general methodology described in recitals (35) to (44) has been applied to the co-
operating producer in the analogue country. Given that domestic sales of SiMn by the 
co-operating USA producer did not occur in the ordinary course of trade during the IP, 
normal  value  has  been  constructed  pursuant  to  Article  2(3)  of  the  basic  Regulation. 
The  profit  margin  used  to  construct  normal  value  has  been  determined  pursuant  to 
Article 2(6)(b) of the basic Regulation on the basis of the profit margin applicable to 
the  same  general  category  of  products  for  the  USA  producer.  Sales,  general  and 
administrative costs incurred by the co-operating USA producer on all domestic sales 
during the IP have been used.  

3.4.  Kazakhstan 

(60)  The general methodology described in recitals (35) to (44) has been applied to the sole 
exporting  producer  in  Kazakhstan,  which  was  granted  MET.  In  view  of  limited 
domestic  sales,  normal  value  had  to  be  constructed  pursuant  to  Article  2(3)  of  the 
basic  Regulation.  In  this  respect,  it  was  found  that  the  domestic  sales  of  the  like 
product by Kazchrome were not representative and that this producer's domestic sales 
of  the  same  general  category  of  products  were  not  in  the  ordinary  course  of  trade. 
Therefore, the amounts for SG&A and for profit used to construct normal value were 
initially  based,  pursuant  to  Article  2(6)  of  the  basic  Regulation,  on  the  weighted 

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average  of  these  amounts  attained  by  the  cooperating  Ukrainian  producers  on  their 
domestic  sales  of  the  like product. Subsequent to definitive disclosure, the exporting 
producer argued that the methodology used to determine the SG&A and profit was not 
appropriate in view of the fact that significant dumping was found for the cooperating 
Ukrainian exporting producers. Alternatively, the Kazakh exporting producer claimed 
that the amounts for SG&A and profit established in the analogue country should be 
used.  Following  these  comments,  it  was  indeed  considered  not  appropriate  to  use 
profits from the Ukrainian producers in these circumstances. It was thus re-examined 
pursuant to Article 2(6) of the basic Regulation on which basis the amounts for SG&A 
and  profit  could  be  established.  In  this  regard,  it  was  assessed  whether  any  of  the 
company's  SG&A  and  profit  data  relating  to  SiMn  could  be  used  to  establish  the 
relevant amount. As the company is deemed to operate under market conditions and in 
order  to  reflect  as  precise  as  possible  the  domestic  market  situation  of  the  Kazakh 
company, it was decided that the weighted average SG&A and profit obtained on its 
domestic  sales  of  SiMn  to  unrelated  and related  customers  should  be  used  under  the 
chapeau of Article 2(6) of the basic Regulation. In this respect, it should be noted that 
the SG&A and profit realised on its domestic sales to unrelated and related customers 
were  at  almost  identical  levels,  thus  indicating  that  neither  the  SG&A  nor  the  profit 
realised  in  the  sales  to  domestic  related  customers  are  affected  by  the  relationship. 
Moreover, the domestic sales were found to be made in the ordinary course of trade 
and at a reasonably significant level (2,8% of the volume of exports to the Community 
of SiMn). Given that chapeau of Article 2(6) of the basic Regulation prioritises the use 
of a company's  own SG&A and  profit realised on the domestic sales  in the ordinary 
course of trade, the claim to resort to data obtained from the producer in the analogue 
country was thus rejected.  

3.5.  Ukraine 

(61)  The general methodology described in recitals (35) to (44) above has been applied to 
all three exporting producers in Ukraine. For most of the sales, normal value had to be 
constructed in view of the absence of sufficient domestic sales of comparable models. 
Pursuant  to  Article  2(6)(b)  of  the  basic  Regulation,  the  amounts  for  selling,  general 
and  administrative  costs  and  for  profits  used  to  construct  normal  value  have  been 
based  on  the  companies'  actual  data  pertaining  to  the  production  and  sales,  in  the 
ordinary course of trade, of the same general category of products. 

4. 

Export price 

(62)  The  exporting  producers  made  export  sales  to  the  Community  either  directly  to 
independent  customers  or  through  related  or  unrelated  trading  companies  located 
outside the Community. 

(63)  Where  export  sales  to  the  Community  were  made  either  directly  to  independent 
customers in the Community or through unrelated trading companies located outside 
the Community, export prices were established on the basis of the prices actually paid 
or  payable  for  the  product  concerned  in  accordance  with  Article  2(8)  of  the  basic 
Regulation. 

(64)  Where  export  sales to the Community were made through related trading companies 
located in a third country, export prices were established on the basis of the first resale 
prices of these related traders to independent customers in the Community.  

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4.1.  People's Republic of China  

(65)  Since none of the co-operating Chinese exporting producers were granted MET/IT, the 
data  on  their  export  sales  was  not  used  to  establish  individual  dumping  margins  but 
only in the calculation of the country-wide duty, as elaborated in recital (79) below. 

(66)  All three co-operating exporting producer groups in the PRC made all export sales to 
the  Community  directly  to  independent  customers  in  the  Community.  Export  prices 
were therefore established on the basis of the prices actually paid or payable. 

4.2.  Kazakhstan  

(67)  The  sole  co-operating  exporting  producer  made  exports  of  the  product  concerned  to 
the Community via a related trading company  located  in  a  third  country.  The  export 
price of this company was therefore established on the basis of the resale prices of this 
trader to the first independent customer in the Community. 

4.3.  Ukraine  

(68)  Two exporting producers in Ukraine made exports to the Community exclusively via 
unrelated trading companies located in a third country outside the Community and the 
third Ukrainian exporting producer made some of its sales of the product concerned to 
the  Community  to  an  independent  trading  company  in  Ukraine  for  export  to  the 
Community. In both cases, the export price was established on the basis of the prices 
actually paid or payable for the product when sold to the trading company for export 
to the Community.  

(69)  Some  of  the  sales  of  the  third  exporting  producer  were  made  via  a  chain  of  related 
companies  and  ultimately  by  a  related  trader  in  a  third  country.  In  these  cases,  the 
export price was established on the basis of this related trading company's resale prices 
to independent customers in the Community.  

5.  Comparison 

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

(71)  On  this  basis,  for  all  investigated  Kazakh  and  Ukrainian  exporting  producers, 
allowances  for  differences  in  level  of  trade,  transport  and  insurance  costs,  handling, 
loading  and  ancillary  costs,  packing  costs,  credit  costs  and  after  sales  costs 
(warranty/guarantee) were made where applicable and justified.  

(72)  The  SG&A  used  to  construct  normal  value  for  the  Kazakh  exporting  producer 
pursuant to the methodology set out in recital (60) above, included costs for domestic 
freight and insurance. Therefore, albeit no claim had been made in this regard, an ex 
officio  adjustments  to  the  normal  value  pursuant  to  Article  2(10)(e)  was  made  to 
reduce  the  SG&A  by  the  amount  of  the  costs  incurred  on  domestic  freight  and 
insurance.. 

(73)  The sole co-operating exporting producer in Kazakhstan, Kazchrome, submitted that, 
together with its related trader located in Switzerland, ENRC, it formed what it called 
a  "single  economic  entity".  It  claimed  that  therefore,  whilst  the  trader's  sales  price 
should  be  used  for  establishing  the  export  price,  no  adjustments  had  to  be  made  for 
transport costs, SG&A expenses and trader profit.  

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(74)  The claim was  duly investigated. It was found  that ENRC and Kazchrome, although 
related parties, were separate legal entities. Furthermore, these two entities were acting 
on  the  basis  of  a  buyer-seller  relationship.  Consequently,  it  was  concluded  that,  in 
Kazchrome's sales flow to the Community, ENRC had functions similar to those of an 
agent working on a commission basis. In addition, it was established that, whereas all 
Community sales of Kazchrome were done via ENRC, this trader was not a party in 
the  domestic  sales  channel  of  Kazchrome.  Furthermore,  it  was  concluded  that  the 
adjustment  of  the  export  price  should  also  cover  transport  costs  from  the  plant 
onwards,  taking  into  account  different  terms  of  sales,  in  order  to  ensure  a  fair 
comparison between export price and normal value at ex-works level.  

(75)  Therefore,  the  claim  had  to  be  dismissed  and  adjustments  to  the  export  price  for  a 
commission  in  accordance  with  Article  2(10)(i)  of  the  basic  Regulation  and  for 
transport in accordance with Article 2(10)(e) of the basic Regulation were made. The 
level  of  the  commission  was  calculated  based  on  direct  evidence  pointing  to  the 
existence of such functions. In this context, in the calculation of the commission, the 
SG&A  expenses  incurred  by  ENRC  to  sell  the  product  concerned  produced  by 
Kazchrome  were  taken  into  account,  as  well  as  a  profit  margin  for  ENRC,  based,  in 
this case, on that reported by an unrelated importer co-operating in the investigation. 

(76)  For  the  Ukrainian  producer  ultimately  selling  via  a  related  trader  in  a  third  country 
(see  recital  (69)),  an  adjustment  to  the  export  price  for  a  commission  was  made  in 
accordance with Article 2(10)(i) of the basic Regulation, in the cases where sales were 
made  through  this  related  trader,  as  this  trader  had  functions  similar  to  those  of  an 
agent working on a commission basis. The company concerned, NFP, and the related 
trader in question, Steelex SA, were found to be separate legal entities and, directly or 
indirectly,  to  work  on  the  basis  of  a  buyer-seller  relationship.  Moreover,  for  export 
sales  to  the  Community  via  Steelex  SA  a  commission  was  paid.  The  level  of  the 
commission  calculated  by  the  Community  institutions  was  based  on  direct  evidence 
pointing  to  the  existence  of  such  functions.  In  this  context,  the  SG&A  expenses 
incurred by Steelex SA to sell the product concerned produced by NFP were taken into 
account, as well as a profit margin reported by an unrelated importer co-operating in 
the  investigation.  Furthermore,  NFP  made  part  of  its  sales  to  the  Community  by 
Steelex  SA  through  an  unrelated  trader  located  in  another  third  country.  For  these 
sales, in addition to the commission for Steelex SA, it was found reasonable to make 
an  adjustment  for  a  commission  for  the  unrelated  trader  in  accordance  with  Article 
2(10)(i) of the basic Regulation as this trader also had functions similar to those of an 
agent working on a commission basis. This commission was established on the basis 
of its calculated mark-up on the sales in question. 

(77)  One  Ukrainian  exporting  producer  claimed  an  adjustment  for  currency  conversions, 
pursuant  to  Article  2(10)(j)  of  the  basic  Regulation.  This  claim  was  based  on  the 
fluctuation between the exchange rate on the date of invoice and the exchange rate on 
the date of payment. In this respect, it is important to underline that the date of invoice 
is,  in  accordance  with  Article  2(10)(j)  of  the  basic  Regulation,  considered  to  be  the 
date  of  sale  and  the  exchange  rate  to  be  applied  should,  thus,  be  the  exchange  rate 
prevailing at the date of sale. Therefore, this claim had to be rejected. 

6.  Dumping margins 

6.1.  People's Republic of China  

(78) 

In  the  absence  of  MET  or  IT  being  granted  to  any  of  the  co-operating  Chinese 
exporting producers, a country-wide dumping margin was calculated for the whole of 

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the PRC using a weighting factor for the CIF value of each group of exporters, i.e. co-
operators and non-cooperators. 

(79)  To  this  end,  the  dumping  margin  was  firstly  calculated  for  the  co-operating  Chinese 
exporting producers pursuant to Article 2(11) and (12) of the basic Regulation, on the 
basis of a comparison of a weighted average normal value of the analogue country by 
product  type  with  a  weighted  average  export  price  by  product  type  as  established 
above. 

(80) 

It should be noted that the imports from the PRC consisted both of SiMn with normal 
carbon  content  and  low-carbon  SiMn.  However,  the  co-operating  producer  in  the 
analogue country produced only the normal carbon content SiMn. Therefore, only data 
concerning this common product type was used in the comparison. 

(81)  Secondly,  the  dumping  margin  was  established  for  all  non-cooperating  exporting 
producers on the basis of the facts available, in accordance with Article 18(1) of the 
basic Regulation.  

(82) 

In  order  to  determine  the  dumping  margin  for  non-cooperating  exporting  producers, 
the level of non-cooperation was first established. To this end, the volume of exports 
to  the  Community  reported  by  the  co-operating  Chinese  exporting  producers  was 
compared  with  the  total  volume  of  imports  originating  in  the  PRC,  as  based  on 
Eurostat import statistics. This comparison indicated that the level of co-operation was 
low,  since  the  exports  by  the  co-operating  producers  represented  less  than  29  %  of 
total Community imports from the PRC during the IP. 

(83)  Therefore,  the  level  of  dumping  for  the  export  volumes  of  non-cooperating  Chinese 
exporting  producers  was  determined  on  the  basis  of  the  highest  dumping  margin 
established  for  the  co-operating  exporting  producers  for  the  normal  carbon  content 
SiMn. This approach was deemed appropriate since there were no indications that any 
non-cooperating  producer  was  dumping  at  a  lower  level  than  the  co-operating 
exporting  producers.  Therefore,  a  country-wide  average  dumping  margin  was 
calculated using as a weighting factor the CIF value of each group of exporters, i.e. co-
operating  exporters  and  non-cooperating  exporters.  On  this  basis,  the  country-wide 
dumping margin, expressed as a percentage of the CIF import price at the Community 
frontier, duty unpaid, is 60,1 %.  

6.2.  Kazakhstan  

(84)  Based on the complaint, the information available from the exporting producer which 
came forward and other statistical data it appeared that OJSC  Kazchrome is  the sole 
Kazakh  exporting  producer  of  silico-manganese.  As  no  indications  were  found  that 
any  exporting  producer  deliberately  abstained  from  co-operating  it  was  considered 
appropriate  to  set  the  residual  dumping  margin  at  the  same  level  as  the  level 
established for OJSC Kazchrome. 

(85)  The dumping margins established, expressed as a percentage of the CIF import price at 

the Community frontier, duty unpaid, are therefore the following: 

–  OJSC Kazchrome: 6,5 %; 

–  All other companies: 6,5 %. 

6.3.  Ukraine 

(86)  Based on the complaint, the information available from the exporting producers which 
came forward and other statistical data, it was concluded that the level of co-operation 

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was above 80 % in the case of Ukraine. Therefore, it was considered appropriate to set 
the  residual  dumping  margin  at  the  level  of  the  highest  dumping  margin  established 
for a co-operating exporting producer in the country concerned. 

(87)  On this basis, the dumping margins, expressed as a percentage of the CIF import price 

at the Community frontier, duty unpaid, are the following: 

– 

– 

– 

– 

PJSC Nikopol Ferroalloys Plant: 39,1 %; 

JSC Stakhanov Ferroalloys Plant: 53,4 %; 

OJSC Zaporozhye Ferroalloys Plant: 56,7 %; 

All other companies: 56,7 %. 

D. 

INJURY 

1.  General 

(88) 

In 1998, anti-dumping measures were imposed on imports of SiMn originating in the 
PRC and in Ukraine (Council Regulation (EC) No 495/983). Those measures expired 
in  early  March  2003.  Therefore,  during  the  early  part  of  the  period  considered  there 
were measures in place on imports from two of the countries concerned. This fact was 
taken  into  consideration  when  conducting  the  injury  analysis.  As  indicated  in  recital 
(118) below, the evolution in respect of profitability clearly indicates that the removal 
of  the  anti-dumping  measures  in  March  2003  did  not  influence  significantly  the 
situation  of  the  Community  industry  during  the  following  period.  It  is  therefore 
concluded that, contrary to the claim by some interested parties, the year 2002 can be 
considered as the basis for the calculation of the indices mentioned in recitals (93) to 
(141). 

(89)  SiMn  is  a  key  raw  material  used  for  the  production of  steel. There was a significant 
increase  in  demand  for  steel  worldwide,  but  primarily  in  Asia,  which  began  towards 
the  end  of  2003  and  continued  during  the  first  half  of  2004.  This,  combined  with 
production  shortages  of  SiMn  in  Asia  resulted  in  increased  worldwide  demand  for 
SiMn, and led to an unprecedented increase in price during 2004. In carrying out the 
injury  analysis,  account  has  been  taken  of  these  unusual  circumstances,  in  order  to 
ensure that they do not unduly affect the injury picture. 

2.  Community production and Community industry 

(90)  Within the Community, the like product is manufactured by five producers. The output 
of these five Community producers is therefore deemed to constitute the Community 
production within the meaning of Article 4(1) of the basic Regulation. 

(91)  Of these five producers, a total of four, being members of the complaining association, 
declared their interest in co-operating in the proceeding within the time limit set out in 
the  notice  of  initiation  and  properly  co-operated  with  the  investigation.  These  four 
producers were found to account for a major proportion, in this case around 88 %, of 
the total Community production of the like product. The four co-operating producers 
therefore  constitute  the  Community  industry  within  the  meaning  of  Article  4(1)  and 
Article  5(4)  of  the  basic  Regulation  and  will  be  hereafter  referred  to  as  the 
‘Community industry’. The remaining Community producer will be hereafter referred 

3 

OJ L 62, 3.3.1998, p. 1. 

EN 

18 

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to as the 'other Community producer'. This other Community producer did not oppose 
the complaint. 

3.  Community consumption 

(92)  Community  consumption  was  established  on  the  basis  of  the  volumes  of  the 
Community industry’s own production taking into account changes in stock levels, the 
import  and  export  volumes  data  for  the  Community  market  obtained  from  Eurostat 
and,  concerning  the  other  Community  producer,  from  estimations  made  by  the 
Community industry producers. 

(93) 

In the IP, the Community market for the product concerned and the like product was 
approximately 9 % higher than in 2002, i.e. around 914 000 tonnes. During the period 
considered consumption increased to a peak in 2004, when it was 14 % higher than in 
2002, but fell in the following two years. 

Total EC consumption (tonne)
Index (2002=100)

2002
835 419
100

2003
882 607
106

2004
953 692
114

2005
921 654
110

IP
914 240
109  

4. 

Imports from the countries concerned 

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

(94)  The Commission considered whether imports from the countries concerned should be 
assessed  cumulatively  on  the  basis  of  the  criteria  set  out  in  Article  3(4)  of  the  basic 
Regulation. 

(95)  The  dumping  margin  found  for  each  of  the  countries  concerned  was  more  than 
de minimis, the volume of imports from each of these countries was not negligible and 
the cumulative assessment could be considered appropriate in view of the conditions 
of  competition  between  the  imports  from  the  countries  concerned  and  the  like 
Community  product.  These  similar  conditions  of  competition  were  evidenced  by  the 
fact  that  the  product  concerned  imported  from  the  countries  concerned  and  the  like 
product produced and sold by the Community industry within the Community market 
were alike and distributed via the same trade channels. Moreover, all import volumes 
were  substantial  and  resulted  in  significant  market  shares.  However,  in  view  of  the 
absence  of  undercutting  by  imports  from  Ukraine  as  stated  at  recital  (104),  it  is 
considered that the effect of imports from Ukraine should be assessed separately. 

(96)  The  exporting  producer  in  Kazakhstan  maintained  that  Kazakhstan  should  not  be 
cumulated  with  the  PRC  for  the  purpose  of  the  injury  assessment,  because  of  its 
diametrically  different  market  behaviour.  This  exporting  producer  argued  inter  alia 
that  the  evolution  of  Kazakh  import  volumes,  values  and  market  share  for  the 
Community  was  different  from  the  other  countries  concerned  and  that  there  was  a 
difference in product mix. In respect of this, it is acknowledged that there was during 
the period considered an overall decrease in the volume of imports and in market share 
in  respect  of  Kazakhstan  (the  latter  was  5,8  %  in  2002  and  4,6  %  during  the  IP). 
However,  both  the  volume  and  market  share  of  Kazakh  imports  during  the  period 
considered  were  relatively  stable  and  were  at  levels  which  cannot  be  considered  as 
insignificant. In addition, the investigation has shown that the evolution of prices for 
Kazakh  imports  is  not  significantly  different  from  that  for  imports  from  the  other 
countries  concerned.  Therefore,  also  in  light  of  the  considerations  in  recitals  (73)  to 
(75)  it  cannot  be  concluded  that  there  is  a  diametrically  different  market  behaviour 
between imports from the PRC and Kazakhstan and consequently the claim should be 
rejected. 

EN 

19 

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(97) 

In the light of the above, it was considered that all the criteria set out in Article 3(4) of 
the  basic  Regulation  were  met  in  respect  of  the  PRC  and  Kazakhstan.  The  imports 
from  those  two  countries  concerned  were  therefore  examined  cumulatively,  while 
imports from Ukraine were assessed separately. 

(b) Volume  

(98)  The volume of imports of the product concerned from the PRC and Kazakhstan into 
the Community increased steadily from around 48 000 tonnes during 2002 to around 
162 000 tonnes during 2004, before decreasing to around 96 000 tonnes during the IP. 
Between  2002  and  the  IP,  the  volume  of  imports  from  these  countries  increased  by 
99 %. 

Volume of imports from the PRC and Kazakhstan (tonne)
Index (2002=100)
Market share of imports from the PRC and Kazakhstan
Price of imports from the PRC and Kazakhstan (EUR/tonne)
Index (2002=100)

IP
95.491
199
10,4%
 564
122   
(99)  The  volume  of  imports  of  the  product  concerned  from  Ukraine  into  the  Community 
decreased slightly from around 154 000 tonnes during 2002 to around 138 000 tonnes 
during 2003 and 2004, before increasing to around 180 000 tonnes during 2005 and to 
around 210 000 tonnes during the IP. Between 2002 and the IP, the volume of imports 
from these countries increased by 36 %. 

2004
162.227
337
17,0%
 829
179

2005
142.993
297
15,5%
 689
149

2003
66.509
138
7,5%
 464
101

2002
48.091
100
5,8%
 462
100

Volume of imports from Ukraine (tonne)
Index (2002=100)
Market share of imports from Ukraine
Price of imports from Ukraine (EUR/tonne)
Index (2002=100)

(c) Market share  

2002
154 391
100
18,5%
 508
100

2003
137 683
89
15,6%
 490
97

2004
137 514
89
14,4%
 912
180

2005
179 993
117
19,5%
 602
118

IP
210 302
136
23,0%
 550
108  

(100)  The market share held by imports from the PRC and Kazakhstan stood at 5,8 % during 
2002. This increased in 2003 and again in 2004, reaching 17,0 % in that year. During 
2005 the market share decreased slightly to 15,5 % and decreased again during the IP 
to  10,4%.  Overall,  between  2002  and  the  IP,  the  market  share  increased  by  4,6 
percentage points to almost double the market share in 2002.  

(101)  The  market  share  held  by  imports  from  Ukraine  stood  at  18,5  %  during  2002.  This 
decreased in 2003 and again in 2004, reaching 14,4 % in that year. During 2005 the 
market share increased to 19,5 % and increased again during the IP to 23,0 %. Overall, 
between 2002 and the IP, the market share increased by 4,5 percentage points. 

(d) Prices 

(i) 

Price evolution  

(102)  During 2004, prices for the SiMn increased worldwide to exceptional levels due to a 
situation of unusually high demand and low supply, as explained in recital (89). This is 
reflected in the prices of imports from the countries concerned for that year and part of 
2005. This, however, did not affect prices during the IP. Overall, the average price of 
imports of the product concerned originating in the PRC and Kazakhstan increased by 
22  %  between  2002  and  the  IP,  while  the  average  price  of  imports  of  the  product 
concerned originating in Ukraine increased by 8 % over the same period.  

EN 

20 

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(ii)  Price undercutting  

(103)  A  model-to-model  price  comparison  was  made  between  the  exporting  producer  and 
the  Community  industry's  average  selling  prices  in  the  Community.  To  this  end, 
Community  industry’s  prices  to  unrelated  customers  have  been  compared  with  the 
prices  of  co-operating  exporting  producers  of  the  countries  concerned.  Adjustments 
were applied where necessary to take account of differences in the level of trade and in 
the quality of products.  

(104)  The  comparison  showed  that  during  the  IP,  SiMn  originating  in  the  PRC  and 
Kazakhstan sold in the Community each undercut the Community industry's prices by 
4,5  %,  and  consequently  by  4,5  %  overall  on  a  weighted  average  basis.  Prices  of 
imports from Ukraine were at comparable levels to those of the Community industry 
(i.e. no undercutting).  

(105)  With a view to ensure that in the undercutting calculation prices are compared at the 
same level of trade, ex works prices of the Community industry were compared with 
prices  of  the  imported  goods  as  they  enter  the  physical  territory  of  the  Community, 
duly  adjusted  for  the  unloading  and  customs  clearance  costs.  One  interested  party 
contested the methodology used with regard to the Kazakh company, claiming that the 
basis  for  calculation  of  the  price  of  imports  should  be  the  CIF  price  at  the  point  of 
customs  clearance  at  the  EU  ports,  and  not  the  price  of  the  imported  goods  as  they 
enter  the  physical  territory  of  the  Community  (in  this  case  the  land  border  in 
Lithuania).  No  convincing  argument  was  presented  that  would  support  the  need  to 
apply a different method of calculation for this company. On the contrary, it should be 
noted  that  the  CIF  prices  at  the  point  of  customs  clearance  of  the  Kazakh  imports 
include  a  significant  amount  of  transportation  costs  after  the  goods  have  passed  the 
Community border in Lithuania and comparing them with the ex works prices of the 
Community industry would be discriminatory for the latter, as the ex work prices do 
not  include  any  transportation  cost.  Therefore,  it  is  concluded  that  the  methodology 
applied is the most appropriate and consequently the claim is rejected.  

5. 

Situation of the Community industry 

(106)  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. 

(a) Production 

(107)  From a level of around 241 000 tonnes in 2002, the Community industry’s production 
increased to a peak during 2004 of around 255 000 tonnes, due to exceptional demand 
as explained in recital (89), before decreasing in 2005 and increasing slightly in the IP. 
Overall, production decreased over the period considered by 6 % to around  226 000 
tonnes  during  the  IP.  It  should  be  noted  that  one  Community  producer  stopped 
production of SiMn during 2003 and for much of the IP. 

Production (tonne)
Index (2002=100)

(b) Capacity and capacity utilisation rates 

2002
241 784
100

2003
220 073
91

2004
255 671
106

2005
221 402
92

IP
226 142
94  

(108)  The  production  capacity  of  the  Community  industry  remained  stable,  at  a  level  of 

around 325 000 tonnes, throughout the period considered. 

EN 

21 

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Production capacity (tonne)
Index (2002=100)
Capacity utilisation
Index (2002=100)

IP
326 696
100
69%
93  
(109)  Capacity utilisation was 74 % in 2002. It declined to 68 % in 2003, increased again to 
79 %  in  2004,  before  declining  to  69 %  in  the  IP.  This  reflects  the  variations  in 
production volumes as described in recital (107). 

2002
325 226
100
74%
100

2004
325 254
100
79%
106

2003
325 537
100
68%
91

2005
326 068
100
68%
91

(c) Stocks  

(110)  The level of closing stocks of the Community industry decreased by 45 % in 2003, but 
returned in 2004 to almost the same level as in 2002. The steep decrease in stocks at 
the end of 2003 was due to the reaction to the exceptional increase in demand referred 
to  in  recital  (89).  Closing  stocks  then  increased  in  2005  by  22  %  before  decreasing 
significantly  in  the  IP  to  a  level  30  %  below  2002  levels.  This  overall  decrease  in 
closing  stocks  accounts  for  the  fact  that  the  Community  industry's  EC  sales  volume 
remained  stable  overall  (see  recital  (111)),  despite  the  decrease  in  production  as 
described in recital (107). 

Closing stock (tonne)
Index (2002=100)

(d) Sales volume  

2002
21 017
100

2003
11 561
55

2004
20 983
100

2005
25 682
122

IP
14 618
70  

(111)  The  sales  volume  by  the  Community  industry  of  its  own  production  to  unrelated 
customers  on  the  Community  market  during  the  IP  was  around  227  000  tonnes,  the 
same as in 2002. However, the 2003 and 2005 sales volumes were 6 % and 8 % lower, 
respectively. In 2004, sales volume was higher at 104 % of the 2002 and IP level for 
the reasons already explained in recital (89). 

EC Sales volume to customers (tonne)
Index (2002=100)

(e) Market share 

2002
227 571
100

2003
213 778
94

2004
236 494
104

2005
208 687
92

IP
227 690
100  

(112)  The market share held by the Community industry decreased from 27,2 % in 2002 to 
24,2 % in 2003, before recovering to 24,8 % in 2004. In 2005, market share decreased 
again  to  22,6  %.  During  the  IP,  it  recovered  somewhat  to  24,9  %.  Over  the  period 
considered, the Community industry lost 2,3 percentage points of market share. 

Market share of the Community industry
Index (2002=100)

(f) Growth 

2002
27,2%
100

2003
24,2%
89

2004
24,8%
91

2005
22,6%
83

IP
24,9%
91  

(113)  Between  2002  and  the  IP,  when  the  Community  consumption  increased  by  9 
percentage points, the volume of sales by the Community industry on the Community 
market did not increase and the Community industry's market share decreased by 2,3 
percentage points. On the other hand, the sales volume and market share of the PRC 
and Ukraine increased over the same period. It is thus concluded that the Community 
industry could not benefit from any growth on the Community market. 

(g) Employment 

(114)  The  employment  level  of  the  Community  industry  first  decreased  by  32 %  between 
2002  and  2003,  increased  by  27  percentage  points  in  2004,  before  decreasing  by  13 

EN 

22 

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percentage  points  in  2005  and  a  further  26  percentage  points  in  the  IP.  During  the 
period considered, production volume remained relatively stable, varying between 91 
% and 106 % of the 2002 level. However, for one producer who stopped production of 
SiMn  in  the  IP,  as  referred  to  in  recital  (107),  the  variation  in  production  volumes 
during the period considered was more pronounced and the variation in employment 
reflects  this.  Overall,  employment  of  the  Community  industry  declined  by  44 % 
between  2002  and  the  IP,  i.e.  from  around  700 persons  to  around  400 persons.  This 
shows  that  the  Community  industry  improved  efficiency  since,  at  the  same  time, 
production volumes only decreased by 6 %. 

Employment (persons)
Index (2002=100)

(h) Productivity  

2002
 702
100

2003
 475
68

2004
 668
95

2005
 577
82

IP
 391
56  

(115)  Productivity of the Community industry's workforce, measured as output (tonnes) per 
person employed per year, starting from a level of 344 tonnes per employee, increased 
over the period considered, apart from 2004, and finished during the IP at a level 68 % 
up  on  2002.  This  reflects  the  fact  that  employment  fell  by  44  %  over  the  period 
considered  while  production  only  decreased  by  6  %.  The  increase  in  productivity  is 
partly due to the fact that job reductions were higher for those Community producers 
where productivity was initially relatively low.  

Productivity (tonne per employee)
Index (2002=100)

(i) Wages  

2002
 344
100

2003
 463
135

2004
 383
111

2005
 384
111

IP
 578
168  

(116)  The average wage per employee increased by 26 % between 2002 and 2003, remained 
at a similar level during 2004 before increasing again in 2005 and the IP to finish 77 % 
higher than in 2002. The increase in average wage costs is partly due to the fact that 
job reductions were higher for those Community producers where average wages were 
initially relatively low.  

Annual labour cost per employee (EUR)
Index (2002=100)

(j) Factors affecting sales prices  

2002
17 602
100

2003
22 102
126

2004
21 636
123

2005
22 459
128

IP
31 092
177  

(117)  Unit prices for Community industry's sales to unrelated customers increased overall by 
14  %  between  2002  and  the  IP.  In  2004  prices  were  exceptionally  high  due  to  the 
worldwide  situation  of  unusually  high  demand  and  low  supply  referred  to  in  recital 
(89). The effect of this situation carried over partly into 2005 when prices returned to 
more normal levels, but finished during the IP 14 % higher than in 2002.  

Unit price EC market (EUR/tonne)
Index (2002=100)

(k) Profitability and return on investments 

2002
 521
100

2003
 526
101

2004
 928
178

2005
 640
123

IP
 593
114  

(118)  During  the  period  considered,  the  profitability  of  the  Community  industry's  sales  of 
the like product, expressed as a percentage of net sales, increased from 0,8 % in 2002 
to  3,1  %  in  2003,  increased  exceptionally  to  37,2  %  in  2004  due  to  the  situation 
described at recital (89), returned to 7,0 % in 2005 and to 2,5 % in the IP. Profitability 
therefore increased by 1,7 percentage points between 2002 and the IP. 

EN 

23 

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

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

IP
2,5%
313
10,4%
284  
(119)  The return on investments (‘ROI’), expressed as the profit in percent of the net book 
value of investments, broadly followed the profitability trend. It increased from a level 
of 3,6 % in 2002 to 11 % in 2003, increased exceptionally to 410 % in 2004, returned 
to 24 % in 2005, before reaching finally a level of 10,4 % in the IP, thus increasing by 
6,8 percentage points over the period considered. 

2004
37,2%
4668
410,2%
11252

2005
7,0%
884
24,4%
668

2003
3,1%
385
11,0%
303

2002
0,8%
100
3,6%
100

(l) Cash flow and ability to raise capital  

(120)  The  net  cash  flow  from  operating  activities  was  almost  zero  in  2002.  It  increased  to 
around 9 million EUR in 2003, to 83 million EUR in 2004, before returning to around 
16 million EUR in 2005 and 17 million in the IP. There were no indications that the 
Community industry encountered difficulties in raising capital. 

Cash flow (000 EUR)
Index (2002=100)

(m) Investments  

2002
  132
100

2003
 9 551
7214

2004
 83 701
63220

2005
 16 445
12421

IP
 17 092
12910  

(121)  The  Community  industry's  annual  investments  in  the  production  of  the  like  product 
increased  fivefold  between  2002  and  2003  before  returning  in  2004  to  around  2002 
levels. Investments increased again by around eightfold between 2004 and 2005 before 
declining slightly in the IP. Overall, investments increased by around 900 % between 
2002  and  the  IP.  The  Community  industry's  investments  can  be  attributed  mainly  to 
one  Community  producer  and  it  was  established  that  they  were  for  the  maintenance 
and renewal of existing equipment, and not for capacity increase purposes. 

Net investments (000 EUR)
Index (2002=100)

(n) Magnitude of dumping margin  

2002
 1 528
100

2003
 8 376
548

2004
 2 351
154

2005
 17 365
1.136

IP
 15 333
1.003  

(122)  Given the volume, the market share and the prices of the imports from the countries 
concerned,  the  impact  on  the  Community  industry  of  the  magnitude  of  the  actual 
margins of dumping cannot be considered to be negligible.  

(o) Recovery from past dumping 

(123)  As  indicated  at  recital  (88),  the  evolution  in  respect  of  profitability  clearly  indicates 
that  the  removal  of  the  anti-dumping  measures  on  SiMn  in  March  2003  did  not 
influence  significantly  the  situation  of  the  Community  industry  during  the  following 
period.  

6.  Conclusion on injury 

(124)  In a context of growing consumption, the Community industry's market share declined 
by  2,3  percentage  points  to  24,9  %  during  the  period  considered.  At  the  same  time, 
production  decreased  by  6  %  and  the  capacity  utilisation  also  decreased  by  5 
percentage  points.  Moreover,  the  Community  industry  had  to  release  a  number  of 
employees. On the other hand, some injury indicators indicate a positive trend during 
the period considered, such as profitability, cash-flow, return on investments and sales 
price  which  increased  by  14  %.  A  more  thorough  analysis  of  that  data  nevertheless 
shows that, given the nature of the business, a profit margin of 2, 5% is not considered 

EN 

24 

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as sufficient as it cannot guarantee the continuation of the industry in the long term. As 
regards the price increase, it was enough to cover the increase in raw material prices, 
but not to raise the profit margin to a sustainable level. Therefore, while a number of 
indicators show positive trends, the Community industry could not benefit at all from 
the  overall  increase  in  consumption  on  the  Community  market,  as  evidenced  by  its 
loss of market share, drop in production and by its poor profitability.  

(125)  As  one  Community  producer  did  not  manufacture  the  like  product  continuously 
throughout the period considered, stopping production altogether during 2003 and for 
most  of  the  IP,  as  referred  to  in  recital  (107),  the  impact  of  this  intermittence  was 
further  examined.  The  analysis  has  shown,  however,  that  due  to  the  relatively  small 
overall  output  of  this  producer  its  intermittent  production  pattern  had  only  limited 
impact  on  the  overall  injury  picture  and  did  not  inflate  the  injury  indicators  to  a 
significant extent. This is evidenced by the fact that excluding this producer from the 
analysis  would  result  in  only  slightly  better  performance  figures.  In  particular,  the 
profitability of the Community industry would still be far from satisfactory at 3,2 % in 
the  IP,  while  production  and  capacity  utilisation  would  still  be  showing  negative 
trends.  Thus,  it  is  concluded  that  the  injury  suffered  by  the  Community  industry 
cannot be attributed solely to this Community producer. 

(126)  In the light of the foregoing, it is concluded that the Community industry has suffered 

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

1. 

Introduction 

E. 

CAUSATION 

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

2. 

Effect of the dumped imports 

(128)  Between 2002 and the IP, the volume of the dumped imports of the product concerned 
originating  in  the  PRC  and  Kazakhstan  increased  by  99  %  and  their  share  of  the 
Community  market  increased  by  around  4,6  percentage  points.  The  average  price  of 
these imports increased by 22 % between 2002 and the IP, but prices were generally 
lower  than  those  of  the  Community  industry  during  the  period  considered.  Over  the 
same period, the volume of the dumped imports of the product concerned originating 
in Ukraine increased by 36 % and their share of the Community market increased by 
around  4,5  percentage  points.  The  average  price  of  these  imports  increased  by  8  % 
between  2002  and  the  IP,  but  prices  were  generally  at  levels  close  to  those  of  the 
Community industry during the period considered. 

(129)  As indicated in recital (104) above, price undercutting  of imports from  the  PRC and 
Kazakhstan  was  4.5  %  overall  on  a  weighted  average  basis,  while  there  was  no 
undercutting by imports from Ukraine.  

(130)  In view of the undercutting of Community industry's prices by imports from the PRC 
and  Kazakhstan,  it  is  considered  that  these  dumped  imports  exerted  a  downward 
pressure  on  the  prices,  preventing  the  Community  industry  from  increasing  its  sales 
prices  to  a  level  that  would  have  been  necessary  to  realize  a  sustainable  profit. 

EN 

25 

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Therefore,  there  is  a  clear  causal  link  between  those  imports  and  the  Community 
industry's injury. On the other hand, in view of the absence of undercutting by imports 
from  the  Ukraine  and  the  fact  that  the  injury  margin  for  Ukraine  is  at  a  de  minimis 
level  (see  recitals  (168)  and  (169)),  it  is  considered  that  there  is  no  clear  causal  link 
between imports from Ukraine and the injury to the Community industry.  

3. 

Effect of other factors 

(a) Export performance of the Community industry 

(131)  As can be seen from the table below, the volume of export sales decreased by 40 % 
during the period considered. The unit price of these sales remained relatively stable, 
with the exception of those during 2004.  

Export sales volume (tonne)
Index (2002=100)
Export sales price (EUR/tonne)
Index (2002=100)

IP
7 191
60
  578
97  
(132)  It  should  be  noted,  however,  that  the  level  of  export  sales  is  not  significant  in  the 
context of the Community industry's overall sales, representing only around 3 % to 7 
% of total sales during the period considered. It is therefore considered that the export 
activity  cannot  have  contributed  in  any  way  to  the  material  injury  suffered  by  the 
Community industry. 

2004
10 524
87
  787
132

2003
16 445
136
  522
87

2002
12 056
100
  598
100

2005
9 713
81
  592
99

(b) Imports from third countries  

(133)  The  analysis  of  imports  from  third  countries  is  based  on  data  from  Eurostat.  For  a 
number of countries it was possible to crosscheck this data with verified information 
provided by interested parties, which confirmed the reliability of Eurostat data. 

(134)  Overall imports from all countries, other than the countries concerned, decreased over 
the  period  considered  by  around  6  %,  i.e.  from  around  377  000  tonnes  in  2002  to 
around  354  000  tonnes  in  the  IP.  The  corresponding  market  share  declined  from 
around  45  %  to  around  39 %.  The  main  sources  of  imports  from  third  countries  are 
Norway, India, South Africa and Brazil.  

Volume from all other third countries (tonnes)
Index (2002=100)
Market share of all other third countries
Price from all other third countries (EUR/tonne)
Index (2002=100)
Source: Eurostat

2002
376 919
100
45,1%
 523
100

2003
437 205
116
49,5%
 528
101

2004
393 857
104
41,3%
 823
157

2005
364 250
97
39,5%
 691
132

IP
353 802
94
38,7%
 597
114

(135)  Imports  from  Norway  decreased  by  around  11  %,  and  the  market  share  of  those 
imports  decreased  by  4,9  percentage  points  (IP  =  21,9  %),  during  the  period 
considered. Overall, the average price of imports from Norway was above that of the 
Community industry throughout the period considered. While the price of low-carbon 
imports from Norway may undercut Community industry prices to some extent, given 
that  this  quality  of  product  only  represents  a  small  part  (roughly  5  %)  of  the  total 
production  of  the  Community  industry,  and  in  view  of  the  absence  of  overall 
undercutting  and  the  decrease  in  both  import  volumes  and  market  share,  it  was 
considered that imports from Norway did not contribute to the material injury suffered 
by the Community industry. 

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26 

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Norway
Volume of imports (tonne)
Index (2002=100)
Market share of imports
Price of imports (EUR/tonne)
Index (2002=100)
Source: Eurostat

2002
224 253
100
26,8%
 574
100

2003
213 838
95
24,2%
 604
105

2004
178 639
80
18,7%
 956
167

2005
200 310
89
21,7%
 765
133

IP
200 272
89
21,9%
 656
114

(136)  Imports  from  India  increased  by  over  300  %,  and  the  market  share  of  those  imports 
increased by 7,3 percentage points (IP = 9,7 %), during the period considered. At the 
same time the average price of imports from India was slightly higher than those of the 
Community industry (i.e. no undercutting). In view of the absence of undercutting by 
imports from India, it is considered that there is no clear evidence that imports from 
India contributed to the injury suffered by the Community industry. 

India
Volume of imports (tonne)
Index (2002=100)
Market share of imports
Price of imports (EUR/tonne)
Index (2002=100)
Source: Eurostat

2002

2003

2004

2005

19 954
100
2,4%
 479
100

33 497
168
3,8%
 449
94

31 593
158
3,3%
 804
168

48 123
241
5,2%
 591
123

IP
89 017
446
9,7%
 521
109

(137)  Imports from South Africa decreased by around 38 %, and the market share of those 
imports decreased by 2,5 percentage points (IP = 3,2 %) during the period considered. 
The  average  price  of  imports  from  South  Africa  was  below  that  of  the  Community 
industry  and  similar  to  that  practiced  by  the  countries  concerned.  It  is  therefore 
considered that imports from South Africa may have contributed to the injury suffered 
by  the  Community  industry.  However,  given  the  significant  overall  decrease  in 
imports from South Africa and their small market share, it is considered not sufficient 
to  break  the  causal  link  between  the  material  injury  suffered  by  the  Community 
industry and dumped imports from the PRC and Kazakhstan. 

Volume of imports from S Africa (tonne)
Index (2002=100)
Market share of imports from S Africa
Price of imports from S Africa (EUR/tonne)
Index (2002=100)
Source: Eurostat

2002

2003

2004

2005

47 808
100
5,7%
 417
100

81 330
170
9,2%
 429
103

58 753
123
6,2%
 660
158

52 640
110
5,7%
 611
147

IP
29 531
62
3,2%
 501
120

(138)  Imports from other  third countries,  including Brazil, decreased by around 59 %, and 
the market share of those imports decreased by around 6,4 percentage points (IP = 3,8 
%), during the period considered. At the same time, the average price of imports from 
other  third  countries  was  higher  than  that  of  the  Community  industry  (i.e.  no 
undercutting).  In  view  of  the  absence  of  undercutting  by  those  imports  and  their 
decreasing  trend,  it  is  considered  that  they  did  not  contribute  to  the  material  injury 
suffered by the Community industry.  

Other third countries (including Brazil)
Volume of imports (tonne)
Index (2002=100)
Market share of imports
Price of imports (EUR/tonne)
Index (2002=100)
Source: Eurostat

2002

84 904
100
10,2%
 460
100

2003
108 539
128
12,3%
 476
104

2004
124 872
147
13,1%
 713
155

2005

63 178
74
6,9%
 598
130

IP
34 982
41
3,8%
 528
115

(c) Competition from the other Community producer 

(139)  As  indicated  under  recital  (91)  above,  one  Community  producer  did  not  co-operate 
with  the  investigation.  Based  on  information  obtained  in  the  course  of  the 

EN 

27 

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investigation  from  cooperating  Community  producers,  it  is  estimated  that  its  sales 
volume  in  the  Community  was  around  30 000  tonnes  throughout  the  period 
considered.  Similarly,  the  corresponding  market  share  was  stable  throughout  the 
period  considered  at  around  3  %.  The  other  Community  producer  therefore  did  not 
gain any sales volume and market share at the expense of the Community industry. No 
information was available concerning the prices of this Community producer. 

EC Sales volume of the other Community producers (tonne)
Index (2002=100)
Market share of the other Community producers
Index (2002=100)
Source: Investigation, complaint

2002
30 000
100
3,6%
100

2003
30 000
100
3,4%
95

2004
30 000
100
3,1%
88

2005
30 000
100
3,3%
91

IP
30 000
100
3,3%
91

(140)  Given the above, and given the absence of information to the contrary, it is concluded 
that  the  other  Community  producer  has  not  contributed  to  the  injury  suffered  by  the 
Community industry. 

(d) Cost of production (raw materials) 

(141)  The main elements in the total cost of production are raw materials (around 45 % to 55 
%) and electricity (around 20 % to 30 %). Direct labour accounts for around 5 % of 
costs. The cost of production of the Community industry increased by 12 % between 
2002 and the IP. 

2002
  517
100

2003
  510
99

2004
  583
113

2005
  595
115

Unit cost of production (EUR/tonne)
Index (2002=100)

IP
  578
112  
(142)  Some  interested  parties  claimed  that  the  injury  suffered  by  the  Community  industry 
was attributable to the increases in the cost of production. In respect of raw material 
costs, since these are generally commodity products which, in principle, are traded on 
the  international  market,  it  is  considered  that  the  price  increase  has  affected  all 
producers  of  SiMn,  which  would  normally  be  forced  to  increase  their  sales  prices 
across-the-board.  The  injury  was  thus  not  caused  by  the  general  increase  in  raw 
material  prices  as  such  but  by  the  fact  that,  due  to  the  dumped  imports  which  were 
undercutting the Community industry's prices, the Community industry was unable to 
sell at a level that would have allowed it to realise a sufficient profit margin. As for 
labour  costs,  as  indicated  at  recital  (115)  above,  data  concerning  productivity  show 
that,  overall,  the  Community  industry  has  managed  to  offset  increases  in  costs  with 
increases  in  efficiency  and  productivity.  Some  parties  referred  to  electricity  costs  as 
the main reason why Community industry would have suffered injury. In this respect, 
it  was  established  that  the  electricity  prices  for  the  industrial  users  in  the  countries 
where  the  Community  industry  is  based  were  in  line  with  the  prices  in  other  major 
markets  in  the  world  and  consequently  may  not  be  considered  as  a  source  of  a  self-
inflicted  injury.  The  electricity  costs  may  have  had  some  impact  on  the  overall 
performance,  but  only  in  the  case  of  one  Community  producer  that  experienced 
shortages of the electricity supply due  to important  increases in the  electricity prices 
and the related dispute with the energy supplier. It is concluded that, overall, increases 
in the cost of production have not contributed to the injury suffered by the Community 
industry.  

(e) Self-inflicted injury  

(143)  As the investment of one Community producer increased significantly between 2004 
and the 2005 (see recital (121)), it was examined if the injury was self-inflicted. This 
investment had a direct impact on the cost of production and therefore the profitability 

EN 

28 

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of  the  Community  industry.  However,  the  analysis  has  shown  that  due  to  limited 
weight of this investment in the total cost of production, the impact on the profitability 
was  marginal.  Therefore,  it  is  concluded  that  the  investment  of  one  Community 
producer may have contributed to the injury suffered by the Community industry but 
not to an extent to break the causal link. 

(f) Downturn in the market for silico-manganese due to the cycle in steel production 

(144)  Some parties claimed that the drop in the demand for steel, and the consequent drop in 
demand for SiMn, which occurred during the second half of 2004 and the first half of 
2005,  following  the  unprecedented  increase  in  demand  described  in  recital  (89), 
contributed to the bad state of the Community industry. However, the investigation has 
shown that over the full period considered Community consumption increased overall 
by 9 %. In view of this, the argument is rejected.  

4.  Conclusion on causation 

(145)  The  coincidence  in  time  between,  on  the  one  hand,  the  increase  in  dumped  imports 
from  the  PRC  and  Kazakhstan,  the  increase  in  market  shares  and  the  undercutting 
found  and,  on  the  other  hand,  the  deterioration  in  the  situation  of  the  Community 
industry,  leads  to  the  conclusion  that  the  dumped  imports  caused  the  material  injury 
suffered  by  the  Community  industry  within  the  meaning  of  Article  3(6)  of  the  basic 
Regulation.  

(146)  Other  factors  were  analysed  but  were  found  not  to  be  a  determining  reason  for  the 
injury  suffered.  As  concerns  Ukraine,  which  represents  23  %  of  market  share,  since 
there is no undercutting overall, it is considered that its imports did not contribute to 
the  injury  of  the  Community  industry.  Imports  from  South  Africa  may  have 
contributed  to  the  injury  suffered  by  the  Community  industry,  but  given  their  small 
market share and declining volumes not to an extent sufficient to break the causal link 
established  with  the  imports  from  the  PRC  and  Kazakhstan.  Due  to  the  lack  of 
undercutting,  the  import  volumes  and  trend  figures,  there  is  also  no  evidence  that 
imports  from  India  or  other  third  counties  (including  Brazil)  have  contributed  to  the 
injury  suffered  by  the  Community  industry.  The  investment  of  one  Community 
producer  may  have  contributed  to  the  injury  suffered  by  the  Community  industry; 
however, due to limited weight of this investment, not to an extent to break the causal 
link. Moreover, no other known factor, i.e. the export performance of the Community 
industry,  competition  from  the  other  Community  producer,  the  increase  in  cost  of 
production  or  the  market  cycle  for  steel,  has  contributed  to  the  injury  of  the 
Community industry.  

(147)  Based  on  the  above  analysis,  which  has  properly  distinguished  and  separated  the 
effects  of  all  known  factors  having  an  effect  on  the  situation  of  the  Community 
industry  from  the  injurious  effect  of  the  dumped  imports,  it  is  concluded  that  the 
imports from the PRC and Kazakhstan have caused material injury to the Community 
industry within the meaning of Article 3(6) of the basic Regulation. 

F. 

COMMUNITY INTEREST 

(148)  The Commission examined whether, despite the conclusions on dumping, injury and 
causation, compelling reasons existed which would lead to the conclusion that it is not 
in the Community interest to adopt measures in this particular case. For this purpose, 
and pursuant to Article 21(1) of the basic Regulation, the Commission considered the 
likely impact of measures on all parties involved as well as the likely consequences of 
not taking measures. 

EN 

29 

   EN 

 
1. 

Interest of the Community industry 

(149)  In  the  light  of  the  foregoing,  measures  would  be  imposed  on  imports  from  the  PRC 
and Kazakhstan. It is expected that the imposition of these measures would lead to an 
increase  in  prices  for  SiMn  from  those  countries  and  would  provide  the  Community 
industry  with  an  opportunity  to  improve  its  situation  through  increased  prices  and 
possibly  through  increased  sales  volumes  and  market  share.  In  the  absence  of 
measures, it is expected that imports would continue at low prices from the PRC and 
Kazakhstan  and  that  the  Community  industry  would  not  have  the  opportunity  to 
improve its situation.  

(150)  As  for  the  low-carbon  product,  this  represents  only  5  %  of  the  production  of  the 
Community  industry  and  is  imported  mainly  from  Norway,  but  also  from  the  PRC. 
While  it  is  considered  that,  should  measures  be  imposed,  the  quantities  presently 
coming from the PRC could be to some extent substituted by imports from Norway, 
the measures would provide the Community industry with the opportunity to increase 
its own production and sales of low-carbon product in order to meet demand.  

2. 

Interest of the other Community producers 

(151)  There  is  only  one  other  producer  in  the  Community  in  addition  to  the  Community 
industry.  In  the  absence  of  co-operation  from  this  producer,  and  thus  of  precise  data 
concerning  its  activity,  it  is  estimated,  based  on  information  from  co-operating 
Community producers, that this manufacturer's production is around 10 % to 15 % of 
that of the Community industry. Should anti-dumping measures be imposed, the same 
type  of  developments,  as  set  out  in  recitals  (149)  and  (150)  for  the  Community 
industry, can be expected for this other Community producer as well. 

3. 

Interest of unrelated importers in the Community 

(152)  Two independent importers of the product concerned co-operated in the proceeding by 

completing and submitting questionnaires. 

(153)  These  importers  expressed  concern,  should  measures  be  imposed,  regarding  (i)  the 
negative  impact  on  the  supply  situation  within  the  Community,  given  that  the  total 
production capacity within the Community amounted to only approximately one third 
of the consumption, and (ii) the adverse effect any measures would have on the cost of 
the  product  concerned,  which,  as  a  fundamental  raw  material  for  the  production  of 
steel, would affect overall Community steel production. 

(154)  As concerns the supply situation within the Community, it is true that consumption is 
around  three  times  the  current  Community  production  capacity  and  that  the 
Community industry only supplied around 25 % of Community demand during the IP. 
However, the Community industry was operating at around 70 % capacity utilisation 
during  the  IP,  and  at  between  70  %  and  80  %  capacity  utilisation  over  the  period 
considered. It is therefore in a position to significantly increase its current production. 
Also,  given  the  relatively  limited  quantities  of  imports  which  will  be  subject  to 
measures  (as  indicated  at  recitals  (149)  and  (150)  above)  and  that  the  possible 
reduction  of  imports  from  the  countries  concerned  could  be  compensated  by  exports 
from other countries, it is considered that the imposition of duties would not have any 
sizeable  impact  on  the  availability  of  supplies  for  importers.  Also,  in  addition  to 
supplies  from  Community  producers  and  from  the  countries  concerned  by  the 
investigation, the Community market is also supplied, to the extent of almost 40 % of 
consumption,  by  imports  from  other  countries,  notably  Norway,  India,  South  Africa 

EN 

30 

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and Brazil. Those countries have cumulatively in the past supplied higher quantities to 
the Community.  

(155)  It  is  recognised  that  if  measures  were  introduced,  there  may  be  some  short-term 
disruption  due  to  possible  delays  with  increasing  Community  production  and  if  it 
proves necessary for some users to arrange new or alternative supplies.  

(156)  As far as importers are concerned, even if the Community industry were to increase its 
production, sales and market share within the Community, given that the Community 
industry  can  only  supply  around  30  %  of  the  market,  and  that  Community 
consumption  is  growing,  there  would  still  remain  a  need  for  substantial  import 
activity.  While  it  is  recognised  that  importers  generally  operate  on  a  relatively  low 
profit  margin  and  that  any  short-term  disruption  resulting  from  users  seeking  to 
arrange  new  or  alternative  supplies  could  negatively  affect  their  margins,  it  is 
considered  that  importers  are  in  a  position  to  safeguard  their  margins  by  passing  on 
any increased costs to users.  

4. 

Interest of the users 

(157)  Ten users of the product concerned in the metal industry co-operated in the proceeding 
by  completing  and  submitting  questionnaires  or  making  submissions.  A  submission 
was  also  received  from  the  European  Confederation  of  Iron  and  Steel  Industries 
(EUROFER). 

(158)  Users  expressed  similar  concerns  regarding  sufficient  supply  and  increased  costs  for 
end-users, as did importers, as stated in recital (153) above. For the reasons set out in 
recital (154), it is considered that the imposition of measures would not have a serious 
detrimental mid-term effect on the supply situation in the Community.  

(159)  The direct effect of an increase in the price of SiMn on steel production costs would be 
limited, given that the SiMn represents at most 1 % of the production cost of carbon 
steel, and even less in the case of stainless steel. On the basis of information supplied 
by the user industry association (EUROFER) concerning the total annual cost for their 
usage of SiMn, it is estimated that the effect of even a significant increase of 20 % in 
the  price  affecting  all  SiMn  would  be  to  reduce  the  profitability  of  steel  producers 
(currently  achieving  profit  levels  of  between  10  %  to  40  %)  by  only  around  0,2  %. 
Given  that  measures  would  be  at  a  significantly  lower  rate,  and  would  only  affect  a 
maximum of 10 % of the Community consumption (in case that no imports subject to 
measures  would  be  substituted  by  imports  from  other  origins),  the  effect  of  any 
possible measures on the profitability of the steel industry would be extremely limited.  

(160)  It  has  been  claimed  that  the  market  for  the  SiMn  is  a  global  one  and  that  global 
demand is increasing in line with increasing demand for steel. When demand increases 
over supply, this can lead to significant price increases, as happened in 2004. Should a 
temporary disruption of supply and demand in the Community develop, as described 
in  recital  (155),  this  could  lead  to  price  increases  in  the  short-term  in  excess  of  the 
level of any duties imposed. However, in view of the fact that the market for the SiMn 
is a global one, it is considered that the price level within the Community is set by the 
interplay of global supply and demand and that Community prices should not go out of 
line  with  world  prices  to  any  great  degree  for  any  extended  period  due  to  the 
significant  presence  of  imports  from  other  origins  on  the  market.  In  addition,  steel 
producers,  who  are  currently  operating  at  satisfactory  profit  levels  (10  %  to  40  %), 
will, in any case, have the possibility to pass on the effect of any price increase for the 

EN 

31 

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product concerned, which will be limited by the relatively minor significance of SiMn 
in the overall cost of steel production.  

(161)  Users  also  questioned  the  effectiveness  of  imposing  measures,  arguing  that  the 
imposition  and  removal  of  previous  measures  had  little  effect  on  the  profitability  of 
the  Community  industry.  In  this  regard,  although  the  purpose  of  imposing  anti-
dumping  measures  is  to  restore  fair  market  conditions  with  a  view  to  providing  the 
opportunity  for  a  Community  industry,  which  was  materially  injured  through 
dumping,  to  recover,  the  fact  that  such  recovery  may  not  have  realised  in  the  past 
should  not  be  a  reason  against  considering  the  appropriateness  of  imposing  anti-
dumping measures where this is now warranted.  

(162)  Some users pointed out that over the past 10 years or so the Community steel industry 
has suffered from increased costs from anti-dumping measures which had been placed 
on  a  variety  of  raw  materials  used  solely  or  mainly  for  steel  production.  They  also 
pointed out that, in addition to the present proceeding, there were a number of other 
proceedings  currently  open  concerning  raw  materials  used  in  steel  production.  The 
overall  effect,  they  argued,  was  to  place  the  Community  steel  producers  at  a 
disadvantage internationally. As regards previous measures, it should be noted that the 
majority  of  the  previous  measures  have  now  expired.  As  concerns  the  cumulative 
effect of measures on a number of raw materials, it should be borne in mind that the 
purpose  of  anti-dumping  measures  is  to  eliminate  the  impact  of  distorted  market 
conditions  arising  from  the  presence  of  dumped  imports.  As  such,  the  effect  of  anti-
dumping  measures,  even  when  imposed  on  a  number  of  raw  materials  affecting  the 
same  industry,  should  not  have  a  distorting  effect.  In  any  event,  the  impact  of  the 
imposition of any measures in this case on the steel industry would be negligible, as 
explained in recital (159) above. 

(163)  Following  disclosure,  EUROFER  reiterated  its  argument  that  the  imposition  of 
measures  would  not  be  in  the  overall  Community  interest  since  they  would  lead  to 
increased  costs  for  users  and  have  little  effect  in  improving  the  situation  of  the 
Community industry. No new information was provided in this respect and therefore 
the reasoning provided above (recitals (157) to (162)) is confirmed and on this basis it 
is  considered  that  any  impact  from  the  imposition  of  an  anti-dumping  duty  on  the 
financial situation of users is likely to be negligible overall. 

5.  Conclusion on Community interest 

(164)  To conclude, it is expected that the imposition of measures on imports from the PRC 
and Kazakhstan would, despite the availability of limited and decreasing quantities of 
SiMn on the market from other countries (i.e. South Africa and Norway in case of low 
carbon  SiMn)  and  from  suppliers  not  subject  to  measures  at  prices  similar  to  those 
practiced by the PRC and Kazakhstan prior to the imposition of any duties, provide an 
opportunity for the Community industry, as well as the other Community producer, to 
improve its situation through increased sales volumes, sales prices and market share. 
While some negative effects may occur in the form of cost increases for users arising 
out of the possible need to arrange new or alternative supplies, it is considered that the 
overall  effect  on  users  of  the  imposition  of  measures  on  the  PRC  and  Kazakhstan 
would be negligible. In light of the above, it is concluded that no compelling reasons 
exist  for  not  imposing  measures  in  the  present  case  and  that  the  application  of  such 
measures would be in the interest of the Community. 

EN 

32 

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G. 

DEFINITIVE MEASURES 

Estimated injury elimination level 

(165)  The level of any anti-dumping measures should be sufficient to eliminate the injury to 
the  Community  industry  caused  by  the  dumped  imports,  without  exceeding  the 
dumping  margins  found.  When  calculating  the  amount  of  duty  necessary  to  remove 
the effects of the injurious dumping, it was considered that any measures should allow 
the Community industry to obtain a profit before tax that could be reasonably achieved 
under normal conditions of competition, i.e. in the absence of dumped imports. 

(166)  The  Community  industry  claimed  that  a  profit  margin  of  8  %  of  turnover  should  be 
regarded as an appropriate level that it could be expected to obtain in the absence of 
injurious dumping. This was examined and it was found that the claimed profit margin 
would result in the recovery of capital investment over a relatively short time period. 
In  addition,  the  investigation  showed  that  the  Community  industry  itself  generally 
depreciated  its  capital  investments  over  a  longer  time-frame.  On  this  basis,  it  is 
considered that a profit margin of 5 %, which is in line with the margin that was used 
in the investigation which led to the previous anti-dumping measures, is an appropriate 
level  that  the  Community  industry  could  be  expected  to  obtain  in  the  absence  of 
injurious dumping. 

(167)  The  necessary  price  increase  was  then  determined  on  the  basis  of  a  comparison,  per 
product  type,  of  the  weighted  average  import  price,  as  established  for  the  price 
undercutting calculations, with the non-injurious price of the like product sold by the 
Community  industry  on  the  Community  market.  The  non-injurious  price  has  been 
obtained by adjusting the sales price of the Community industry in order to reflect the 
above  mentioned  profit  margin.  Any  difference  resulting  from  this  comparison  was 
then expressed as a percentage of the total CIF import value. In the absence of MET or 
IT  being  granted  to  any  of  the  co-operating  Chinese  exporting  producers,  a  country-
wide  injury  margin  was  calculated  for  the  whole  of  the  PRC  on  the  basis  of  prices 
from Comext. 

(168)  The above-mentioned price comparison showed the following injury margins:  

Ukraine: all companies  

OJSC Kazchrome 

PRC 

1,6 % 

7,3 % 

8,2 % 

(169)  In the light of the foregoing and pursuant to Article 9(4) of the basic Regulation, it is 
considered that a definitive anti-dumping duty should be imposed in respect of imports 
of  SiMn  originating  in  Kazakhstan  and  in  the  PRC  at  the  level  of  the  lower  of  the 
dumping and injury margins, in accordance with the lesser duty rule. By analogy with 
Article 9(3) of the basic Regulation, given that the injury margin for Ukraine is below 
a de minimis level, the investigation in respect of this country should be terminated.  

(170)  Consequently,  and  for  the  reasons  already  mentioned  at  recitals  (165)  to  (169),  the 

anti-dumping duties should be as follows: 

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Country 

Company 

Rate of duty  

Kazakhstan 

All companies 

PRC 

All companies 

6,5 % 

8,2 % 

H. 

UNDERTAKINGS 

(171)  Following the disclosure of essential facts and considerations on the basis of which it 
was  intended  to  recommend  the  imposition  of  definitive  anti-dumping  duties,  the 
exporting  producer  in  Kazakhstan  offered  a  price  undertaking  in  accordance  with 
Article  8(1)  of  the  basic  Regulation.  The  product  concerned  has  shown  in  the  last 
years a considerable volatility in prices and therefore it is not suitable for a fixed price 
undertaking.  In  order  to  overcome  this  problem  the  exporting  producer  offered  to 
index  the  minimum  import  price  to  the  price  of  the  main  raw  material,  namely 
manganese ore. However, the fluctuation in the price of the product concerned cannot 
be explained by the fluctuation in the price of the main raw material, and thus it is not 
possible to index the minimum import prices  to  the  price  of  the  raw  material.  As  an 
alternative approach the exporting producer also offered to index the minimum import 
price on the basis of its own cost of production as it is shown in its audited accounts. 
However  this  approach  cannot  be  accepted  as  the  evolution  of  its  cost  do  not 
necessarily correspond to the evolution of its prices. Moreover, such an undertaking is 
considered  as  unworkable  since  it  would  be  very  difficult  for  the  Commission  to 
constantly monitor the evolution of costs. On the basis of the above it was concluded 
that the undertaking offered by the exporter cannot be accepted, 

HAS ADOPTED THIS REGULATION:  

Article 1 

1. 
A  definitive  anti-dumping  duty  is  hereby  imposed  on  imports  of  silico-manganese 
(including  ferro-silico-manganese)  falling  within  CN  codes  7202  30  00  and  ex  8111  00  11 
(TARIC code 8111 00 11 10), originating in the People’s Republic of China and Kazakhstan.  

2. 
The rate of anti-dumping duty applicable to the net, free-at-Community-frontier price, 
before duty, of the products described in paragraph 1 and produced by the companies below 
shall be as follows: 

Country 

Manufacturer 

Rate of duty  

Kazakhstan  All companies 

PRC 

All companies 

6,5 % 

8,2 %  

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

3. 
apply. 

The  proceeding  concerning  imports  of  silico-manganese  originating  in  Ukraine  is  hereby 
terminated. 

Article 2 

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This  Regulation  shall  enter  into  force  on  the  day  following  that  of  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,  

For the Council 
The President 

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