Proposal for a Council Regulation amending the scope of the anti-dumping measures imposed by Council Regulation (EC) No 130/2006 on imports of tartaric acid originating in the People's Republic of China
Date: 2008-01-23
Institutions: European Commission
Subjects: China, anti-dumping legislation, anti-dumping measure, organic acid, originating product

COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 23.1.2008 
COM(2008) 12 final 

Proposal for a 

COUNCIL REGULATION 

amending the scope of the anti-dumping measures imposed by Council Regulation (EC) 
No 130/2006 on imports of tartaric acid originating in the People's Republic of China 

(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') in the proceeding concerning imports of 
tartaric acid originating in the People's Republic of China. 

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 

Council  Regulation  (EC)  No  130/2006  imposing  a  definitive  anti-dumping  duty  on 
imports of tartaric acid originating in the People's Republic of China. 

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 17 March 2007, the Commission initiated a partial interim review, limited in scope 
to  the  examination  of  the  product  scope  of  the  anti-dumping  measures  applicable  to 
imports of tartaric acid originating in the People's Republic of China.  

The  request  was  lodged  by  CU  Chemie  Uetikon  GmbH,  an  importer  from  Germany, 
who provided prima facie evidence indicating that tartaric acid of the 'D-(-)' type ('D' 

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tartaric acid') should not be subject to the above-mentioned measures. 

The  investigation  revealed  that  'D'  tartaric  acid  and  other  tartaric  acid  types  have 
substantially different basic physical and chemical characteristics and totally different 
end-uses.  In  particular,  'D'  tartaric  acid  is  used  by  the  pharmaceutical  industry  as  an 
auxiliary  substance  in  chemical  synthesis.  These  applications  require  the  specific 
properties of 'D' tartaric acid, for which there is no interchangeability with other types 
of tartaric acid. Furthermore, the price of 'D' tartaric acid is much higher than that of 
other types of tartaric acid, which in practice restricts its market to the aforementioned 
pharmaceutical applications. 

It is therefore proposed to amend the product scope of the anti-dumping measures by 
excluding 'D' tartaric acid. 

Member States were consulted and supported this proposal. 

It  is  proposed  that  the  Council  adopt  the  attached  proposal  for  a  Regulation  which 
should be published in the Official Journal as soon as possible. 

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 reason(s). 

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 instruments: Regulation. 

Other means would not be adequate for the following reason(s). 

The above-mentioned basic Regulation does not foresee alternative options. 

4) 

BUDGETARY IMPLICATION 

The  proposal  has  no  impact  on  expenditure  but  has  a  financial  impact  on  revenue, 
estimated at -€15 543. 

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Proposal for a 

COUNCIL REGULATION 

amending the scope of the anti-dumping measures imposed by Council Regulation (EC) 
No 130/2006 on imports of tartaric acid originating in the People's Republic of China 

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 11(3) thereof, 

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

Whereas: 

1. MEASURES IN FORCE 

By  Regulation  (EC)  No  130/20062  ('the  original  Regulation')  the  Council  imposed  a 
definitive  anti-dumping  duty  on  imports  of  tartaric  acid  originating  in  the  People's 
Republic of China ('PRC').  

2. PRESENT INVESTIGATION 

2.1 Procedure 

The Commission received a request from CU Chemie Uetikon GmbH ('the applicant'), 
an importer from Germany, for a partial interim review pursuant to Article 11(3) of the 
basic  Regulation.  The  applicant  alleged  that  the  so-called  D-(-)  type  is  a  distinct 
product from other types of tartaric acid, due to its specific molecular structure, which 
in turns determines specific chemical characteristics not shared by other types of the 
product  concerned  and  should  not  be  therefore  subject  to  the  above-mentioned 
measures. 

Having determined, after consulting the Advisory Committee, that sufficient evidence 
existed  for  the  initiation  of  a  partial  interim  review,  the  Commission,  on  17  March 
2007,  initiated  an  investigation3  according  to  Article  11(3)  of  the  basic  Regulation. 
The investigation was limited in scope to the definition of the product covered by the 
measures in force. 

The  Commission  officially  advised  the  applicant  importer,  the  authorities  of  the 
exporting  country  and  all  parties  known  to  be  concerned,  of  the  initiation  of  this 
review.  Questionnaires  were  sent  to  Community  producers,  importers,  users  and 
exporting  producers  who  cooperated  in  the  investigation  that  led  to  the  existing 

OJ  L  56,  6.3.1996,  p.  1.  Regulation  as  last  amended  by  Regulation  (EC)  No  2117/2005  (OJ  L  340, 
23.12.2005, p. 17). 
OJ L 23, 27.01.2006, p. 1. 
OJ C 63, 17.03.2007, p. 2. 

(1) 

(2) 

(3) 

(4) 

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(5) 

(6) 

(7) 

(8) 

(9) 

measures. Interested parties were given the opportunity to make their views known in 
writing and to request a hearing within the time limit set out in the notice of initiation. 

Two questionnaire replies were received and one party was granted a hearing. 

The Commission sought and verified all the information it deemed necessary for the 
purpose  of  assessing  whether  the  scope  of  the  measures  should  be  amended  and 
carried out investigations at the premises of the following companies: 

–  CU Chemie Uetikon GmbH, Lahr, Germany 

–  Longchem Corporation, Hangzhou, China 

The investigation period ('IP') covered the period from 1 January 2006 to 31 December 
2006. 

2.2 Product concerned 

The  product  concerned,  as  defined  in  the  original  Regulation,  is  tartaric  acid 
originating  in  the  People's  Republic  of  China,  currently  classifiable  within  CN  code 
2918 12 00. The product concerned is used in wine, in beverage and food additives, as 
a retardant  in plaster and  in  numerous other products. It can be obtained either  form 
the by-products of wine making, as is the case with all Community producers, or via 
chemical  synthesis  from  petrochemical  compounds,  as  is  the  case  with  all  PRC 
exporting producers.  

2.3 Findings 

Tartaric acid is a 'chiral' molecule, i.e. it exists in different geometric configurations. 
The 'L-(+)' and 'D-(-)' types (hereinafter 'L' and 'D' tartaric acid respectively), whose 
molecules are a mirror image of each other, are of particular relevance. Those types of 
tartaric acid are distinguished in widely accepted industry references such as Chemical 
Abstract  Services  ('CAS')  or  European  Inventory  of  Existing  Commercial  Chemical 
Substances ('EINECS'). They can be readily distinguished from one another through a 
test  which  measures  the  rotation  of  polarised  light.  The  direction  of  rotation  for  'L' 
tartaric acid is positive while that for 'D' tartaric acid is negative.  

(10)  The  investigation  which  led  to  the  measures  in  force  focused  on  naturally-occurring 
tartaric acid, which is of the type 'L'. It was found that the product manufactured and 
sold by the Chinese producers had the same basic characteristics as the product of the 
Community  industry,  and  was  in  competition  with  the  latter  for  a  majority  of  the 
above-mentioned applications. 

(11) 

'D' tartaric acid, on the other hand, is not naturally-occurring and can only be obtained 
via  chemical  synthesis.  This  type  of  tartaric  acid  is  not  produced  by  the  Community 
industry  and  it  is  not  recognised  in  the  Community  as  a  food  additive.  Its  known 
applications are in the pharmaceutical industry, in the production of certain auxiliary 
substances which are themselves used to produce the active ingredients of medicines. 
Either 'L' or 'D' tartaric acid can be used in this type of pharmaceutical applications, 
depending on the intended characteristics of the end product. However, the 'D' and 'L' 
types  cannot  be  substituted  for  one  another  within  any  single  application.  These 
conclusions  were  confirmed  by  the  fact  that  the  applicant,  a  company  producing 
auxiliary substances for the pharmaceutical industry, purchased and used both 'L' and 
'D'  tartaric  acid  in  the  manufacture  of  its  products,  rather  than  just  using  one  (less 
expensive) type of tartaric acid. 

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(12)  The investigation has also shown that the price of 'D' tartaric acid is 4 to 5 times higher 
than  that  of  other  types  of  tartaric  acid,  which  is  a  result  of  the  different  production 
process used in its manufacture. This higher price restricts the market for 'D' tartaric 
acid  to  applications  such  as  mentioned  above,  where  other,  less  expensive  types  of 
tartaric acid cannot be used. As a result of those differences in application and costs, 
the size of the market for 'D' tartaric acid is estimated to be less than 1% of the overall 
market for tartaric acid. 

(13) 

In summary, the investigation has found that 'D' tartaric acid has substantially different 
physical  and  chemical  characteristics  from  those  of  'L'  tartaric  acid  produced  by  the 
Community  industry,  meaning  that  the  two  types  are  not  interchangeable  and  not 
competing in the Community market. Given those differences between 'D' tartaric acid 
and the product investigated, it is concluded that 'D' tartaric acid should not be covered 
by the product scope of the measures. 

(14)  The above conclusions were based on the characteristics of pure 'D' tartaric acid, and 
therefore do not apply to any mixtures of 'D' tartaric acid with other products. 

(15) 

Interested parties were informed of the above conclusions. 

(16)  The  Community  industry,  while  not  questioning  the  findings  of  the  investigation, 
expressed  its  concern  that  exempting  one  product  type  could  facilitate  the 
circumvention of the measures. 

(17) 

It is considered, however, that given the differences in prices and quantities involved, 
circumvention  can  promptly  be  detected  through  statistical  data.  Furthermore,  'D' 
tartaric  acid  can  be  easily  distinguished  from  other  types  through  an  optical  test  as 
mentioned above.  

(18)  The Commission will monitor the import data of 'D' tartaric acid and the other types 
which  are  subject  to  measures.  Should  the  quantities  and/or  prices  of  imports  of  D' 
tartaric acid into any Member State depart from the normal trend, the Commission will 
immediately alert the appropriate customs authorities. 

3. RETROACTIVE APPLICATION 

(19)  Given  the  above,  it  is  considered  appropriate  to  amend  the  original  Regulation  to 
clarify the product definition and to exclude 'D' tartaric acid from the measures.  

(20)  Since  the  present  review  investigation  is  limited  to  the  clarification  of  the  product 
scope  and  since  it  was  not  intended  this  product  type  be  covered  by  the  original 
measures, in order to prevent any consequent prejudice to importers of the product, it 
is considered  appropriate that the  findings be applied from the date of the entry into 
force  of  the  original  Regulation,  including  any  imports  subject  to  provisional  duties 
between  30  July  2005  and  28  January  2006.  Moreover,  in  particular  in  view  of  the 
relatively recent entry into force of the original Regulation and of the expected limited 
number of requests for refunds, there is no overriding reason not to provide for such 
retro-active application. 

(21)  Consequently, for goods not covered by Article 1(1) of Council Regulation (EC) No 
130/2006  as  amended  by  this  Regulation,  the  definitive  anti-dumping  duties  paid  or 
entered in the accounts pursuant to Article 1(1) of Regulation (EC) No 130/2006 in its 
initial version should be repaid or remitted. 

(22)  Repayment  or  remission  must  be  requested  from  national  customs  authorities  in 

accordance with applicable customs legislation. 

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(23)  This review does not affect the date on which Council Regulation (EC) No 130/2006 

will expire pursuant to Article 11(2) of the basic Regulation. 

HAS ADOPTED THIS REGULATION: 

Article 1 

Article 1(1) of Council Regulation (EC) No 130/2006 is hereby replaced by the following: 

'1.  A  definitive  anti-dumping  duty  is  hereby  imposed  on  imports  of  tartaric  acid,  excluding 
D-(-)-tartaric acid with a negative optical rotation of at least 12.0 degrees, measured in a water 
solution according to the method described in the European Pharmacopoeia, falling within CN 
code ex 2918 12 00 (TARIC code 2918 12 00 90), and originating in the People's Republic of 
China.' 

Article 2 

For goods not covered by Article 1(1) of Regulation (EC) No 130/2006 as amended by this 
Regulation,  the  definitive  anti-dumping  duties  paid  or  entered  in  the  accounts  pursuant  to 
Article 1(1) of Regulation (EC) No 130/2006 in its initial version shall be repaid or remitted, 
pursuant  to  Article  236  of  Council  Regulation  (EEC)  No  2913/92  of  12  October  1992 
establishing the Community Customs Code4. Repayment or remission shall be requested from 
national customs authorities in accordance with applicable customs legislation. 

This  Regulation  shall  enter  into  force  on  the  day  following  that  of  its  publication  in  the 
Official Journal of the European Union. It shall apply from 28 January 2006. 

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 

4 

OJ L 302, 19.10.1992, p. 1. Regulation as last amended by Regulation (EC) No 1791/2006 (OJ L 363, 
20.12.2006, p. 1). 

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