Proposal for a Council Regulation imposing a definitive anti-dumping duty on imports of certain compressors originating in the People’s Republic of China
Date: 2008-03-11
Institutions: European Commission
Subjects: China, anti-dumping duty, anti-dumping legislation, import, mechanical engineering, originating product

COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 11.3.2008 
COM(2008) 148 final 

Proposal for a 

COUNCIL REGULATION 

imposing a definitive anti-dumping duty on imports of certain compressors 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’). 

•  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  21  December  2006,  the  Commission  initiated  an  anti-dumping  proceeding 
concerning  imports  of  certain  compressors  originating  in  the  People’s  Republic  of 
China. 

No provisional measures were imposed in this case due to the need to further examine 
certain  aspects  of  the  investigation.  The  investigation  found  significant  dumping, 
which caused material injury to the Community industry. It was also showed that there 

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was no compelling Community interest aspect against the imposition of definitive anti-
dumping measures. However, given the magnitude of the burden of the possible duties 
and considering that the envisaged scenario of increased production in the Community 
might  also  not  materialise,  it  is  proposed  to  impose  definitive  measures  for  a  limited 
period of 2 years only and to monitor closely. 

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 certain compressors 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 9 thereof, 

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

Whereas: 

1. 

Initiation 

A. 

PROCEDURE 

(1) 

(2) 

(3) 

(4) 

(5) 

On 20 November 2006, the Commission received a complaint concerning imports of 
certain  compressors  originating  in  the  People's  Republic  of  China  ('PRC')  lodged 
pursuant to Article 5 of the basic Regulation by Federazione  ANIMA/COMPO (‘the 
complainant’)  on  behalf  of  producers  representing  a  major  proportion,  in  this  case 
more than 50 %, of the total Community production of certain compressors. 

The  complaint  contained  evidence  of  dumping  and  of  material  injury  which  was 
considered sufficient to justify the opening of a proceeding. 

On 21 December 2006, the proceeding was initiated by the publication of a notice of 
initiation in the Official Journal of the European Union2. 

2. 

Provisional measures  

Given the need to further examine certain aspects of the investigation, it was decided 
to continue the investigation without the imposition of provisional measures. 

3. 

Parties concerned by the proceeding 

The  Commission  officially  advised  the  exporting  producers  in  the  PRC,  importers, 
traders, users and associations known to be concerned, the representatives of the PRC, 
the complainant Community producers and other Community producers known to be 
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. 

1 

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 314, 21.12.2006, p. 2. 

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(6) 

(7) 

(8) 

(9) 

In order to allow exporting producers to submit a claim for market economy treatment 
(‘MET’) or individual treatment (‘IT’), if they so wished, the Commission sent claim 
forms  to  the  Chinese  exporting  producers  known  to  be  concerned  and  to  the 
representatives of the PRC. Fourteen exporting producers, including groups of related 
companies,  requested  MET  pursuant  to  Article 2(7)  of  the  basic  Regulation,  or  IT 
should the investigation establish that they do not meet the conditions for MET. One 
exporting producer requested only IT. 

In view of the apparent high number of exporting producers in the PRC, importers and 
producers in the Community, in the notice of initiation, the Commission indicated that 
sampling might be applied 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,  Community 
importers  and  Community  producers  were  asked  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  investigation  period 
(1 October 2005 to 30 September 2006). 

As far as the exporting producers are concerned, in accordance with Article 17 of the 
basic Regulation, a sample was selected based on the largest representative volume of 
exports  of  certain  compressors  in  the  Community,  which  could  reasonably  be 
investigated within the time available. On the basis of the information received from 
the  exporting  producers,  the  Commission  selected  the  six  companies,  or  groups  of 
related companies (‘the sampled companies’) having the largest volume of exports to 
the  Community.  In  terms  of  export  volume  the  six  sampled  companies  represented 
93 %  of  the  total  exports  of  certain  compressors  from  the  PRC  to  the  Community 
during  the  investigation  period.  In  accordance  with  Article  17(2)  of  the  basic 
Regulation, the parties concerned were consulted and raised no objection.  

(10)  With regard to the Community producers, given that only three groups of companies 
co-operated in the investigation, it was decided that sampling was not necessary. 

(11)  With  regard  to  importers,  given  that  only  one  importer  co-operated  in  the 

investigation, it was decided that sampling was not necessary. 

(12)  Questionnaires  were  sent  to  all  companies  selected  for  sampling  and  to  all  other 
parties  known  to  be  concerned.  Full  replies  were  received  from  six  exporting 
producers  in  the  PRC,  three  producers  in  the  Community  and  one  importer.  One 
producer  in  the  Community  replied  only  to  the  sampling  questionnaire.  No 
questionnaire replies were received from other interested parties. 

(13)  The  Commission  sought  and  verified  all  the  information  deemed  necessary  for  a 
determination  of  dumping,  resulting  injury  and  Community  interest  and  carried  out 
verifications at the premises of the following companies: 

(a)  Producers in the Community  

– 

– 

– 

ABAC Aria Compressa SpA of the ABAC Group, Torino Italy, 

FIAC SpA of the FIAC Group, Bologna, Italy, 

FINI SpA, Zola Predosa (BO), Italy; 

(b)  Exporting producers in the PRC 

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– 

– 

– 

Nu Air (Shanghai) Compressor and Tools Co. Ltd. of the ABAC Group, 
Shanghai ("Nu Air"), 

Zhejiang Xinlei Mechanical & Electrical Co. Ltd., Wenling ("Xinlei"), 

Hongyou/Taizhou  Group:  (1)  Zhejiang  Hongyou  Air  Compressor 
Manufacturing  Co.  Ltd.,  Wenling  ("Hongyou");  (2)  Taizhou  Hutou  Air 
Compressors Manufacturing Co. Ltd., Wenling ("Taizhou"), 

–  Wealth  Group:  (1)  Shanghai  Wealth  Machinery  &  Appliance  Co.  Ltd., 
Shanghai  ("Shanghai  Wealth");(2)  Wealth  (Nantong)  Machinery  Co., 
Ltd., Nantong ("Wealth Nantong"), 

– 

– 

Zhejiang Anlu Cleaning Machinery Co., Ltd., Taizhou ("Anlu"), 

FIAC  Air  Compressors  (Jiangmen)  Co.  Ltd.  of  the  FIAC  Group 
Jiangmen ("FIAC"); 

(c)  Related companies in the PRC 

–  Wealth  Shanghai  Import-Export  Co.  Ltd.,  Shanghai  ("Wealth  Import 

Export"), 

– 

FIAC  Air  Compressors  (Hong  Kong)  Ltd.  of  the  FIAC  Group  ("FIAC 
Hong Kong"); 

(d)  Unrelated importer in the Community 

– 

Hans Einhell AG, Landau, Germany. 

(14) 

In view of the need to establish a normal value for exporting producers to which MET 
might not be granted, a verification to establish normal value on the basis of data from 
an  analogue  country,  Brazil  in  this  case,  took  place  at  the  premises  of  the  following 
companies: 

(e)  Producers in Brazil 

– 

– 

FIAC Compressores de ar do Brasil Ltda. of the FIAC Group, Araquara, 

Schulz S/A, Joinville, Santa Catarina, Brasil. 

4. 

Investigation period 

(15)  The investigation  of dumping and injury covered  the period from 1 October 2005 to 
30 September  2006  (‘investigation  period’  or  ‘IP’).  The  examination  of  the  trends 
relevant  for  the  assessment  of  injury  covered  the  period  from  1  January  2003  to  the 
end of the investigation period (‘period considered’). 

B. 

PRODUCT CONCERNED AND LIKE PRODUCT  

1. 

Product concerned 

(16)  The  product  concerned  is  reciprocating  compressors,  giving  a  flow  not  exceeding 
2 cubic  metres  (m³)  per  minute,  originating  in  the  People's  Republic  of  China 
('compressors' or 'the product concerned'), normally declared within CN codes ex 8414 
40 10, ex 8414 80 22, ex 8414 80 28 and ex 8414 80 51. 

(17)  A  compressor  is  typically  made  up  of  a  pump,  driven  by  an  electric  motor  either 
directly or through a belt mechanism. In most cases the pressurised air is pumped into 
a  tank  and  exits  through  a  pressure  regulator  and  a  rubber  hose.  Compressors,  in 
particular  the  larger  ones,  can  have  wheels  to  make  them  mobile.  They  can  be  sold 
alone or with accessories for spraying, cleaning, or inflating tyres and other objects. 

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(18)  The  notice  of  initiation  of  this  proceeding  also  referred  to  reciprocating  compressor 
pumps.  The  investigation  showed  that  the  reciprocating  compressor  pumps  are  one 
(but not the only) of the essential components of the compressors under investigation 
(they account for – depending on the model – between 25 % and 35 % of the total cost 
of the final product) and that they can also be sold separately as well as assembled on 
other compressors not falling within the scope of this investigation. The investigation 
also  showed  that  they  do  not  have  the  same  technical  and  physical  characteristics  of 
the  complete  compressors  and  are  not  used  for  the  same  purposes.  The  complete 
compressor also contains other key components (e.g. the tank, the motor). Channels of 
distribution  and  customer  perception  of  a  pump  on  one  hand  and  a  complete 
compressor  on  the  other  hand  also  differ.  Therefore,  it  is  concluded  that  in  this  case 
reciprocating compressor pumps should not be considered as the product concerned.  

(19)  The product concerned is used for driving air-powered tools or for spraying, cleaning, 
or  inflating  tyres  and  other  objects.  The  investigation  has  shown  that,  despite 
differences  in  shapes,  materials  and  production  process,  the  different  types  of  the 
product concerned all share the same basic physical and technical characteristics and 
are basically used for the same purposes. They are therefore considered to constitute a 
single product for the purpose of this proceeding. 

2. 

Like product 

(20)  The  investigation  showed  that  the  basic  physical  and  technical  characteristics  of  the 
compressors  produced  and  sold  by  the  Community  industry  in  the  Community, 
compressors  produced  and  sold  on  the  domestic  market  in  the  PRC  and  on  the 
domestic  market  in  Brazil,  which  served  as  an  analogue  country,  and  compressors 
produced  in  the  PRC  and  sold  to  the  Community  have  essentially  the  same  basic 
physical and technical characteristics and the same basic use.  

(21)  All  these  compressors  are  therefore  considered  to  be  alike  within  the  meaning  of 

Article 1(4) of the basic Regulation. 

1.  General 

C. 

DUMPING 

(22)  Fourteen  companies  or  groups  of  companies  made  themselves  known  representing 
100 % of total exports of the product concerned to the EC. The level of co-operation 
was therefore high. Thirteen companies or groups of companies requested MET while 
one  company  requested  only  IT.  As  mentioned  at  recital  (9)  above,  six  companies 
were selected in the sample on the basis of their export volume. 

2.  Market Economy Treatment (‘MET’) 

(23)  Pursuant  to  Article  2(7)(b)  of  the  basic  Regulation,  in  anti-dumping  investigations 
concerning  imports  originating  in  the  PRC,  normal  value  shall  be  determined  in 
accordance with points 1 to 6 of the said Article for those producers which were found 
to meet the criteria laid down in Article 2(7)(c) of the basic Regulation. 

(24)  Briefly,  and  for  ease  of  reference  only,  the  MET  criteria  are  set  out  in  summarised 

form below: 

(1)  Business  decisions  and  costs  are  made  in  response  to  market  signals  and 
without significant State interference; costs of major inputs substantially reflect 
market values; 

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(2)  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; 

(3)  There  are  no  significant  distortions  carried  over  from  the  former  non-market 

economy system; 

(4)  Bankruptcy and property laws guarantee legal certainty and stability;  

(5)  Exchange rate conversions are carried out at market rates. 

(25)  Five  companies  or  groups  of  companies  of  Chinese  exporting  producers  included  in 
the sample 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. 
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.  The  following  groups  had 
requested MET: 

– 

– 

– 

– 

– 

Nu Air, 

Xinlei, 

Hongyou / Taizhou, 

Shanghai Wealth / Wealth Nantong, 

FIAC. 

(26)  For the above mentioned co-operating exporting producers included in the sample, 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. 

(27)  The  investigation  showed  that  MET  could  not  be  granted  to  three  of  the  above-
mentioned five Chinese exporting producers that had requested MET as none of these 
companies  or  groups  of  companies  met  criterion  2  as  summarized  in  recital  (24) 
above. In addition, one of the groups of companies did not fulfil criterion 3 either. 

(28)  Two companies or groups of companies (FIAC and Nu Air) fulfilled all the criteria as 

summarized in recital (24) above and could be granted MET.  

(29)  One company (Taizhou) part of the group of companies (Hongyou/Taizhou) and one 
company (Wealth Shanghai/Nantong Wealth) could not demonstrate that they fulfilled 
criterion  2  as  summarized  in  recital  (24)  above  since  they  were  not  found  to  have 
accounting  practices  and  accounting  standards  that  were  in  line  with  international 
accounting standards. The group  of companies (Hongyou/Taizhou)  and the company 
(Wealth Shanghai/Nantong Wealth) could therefore not be granted MET. 

(30)  One company (Xinlei) could not demonstrate that it fulfilled criterion 2 as summarized 
in recital (24) above since its accounting practices and accounting standards were not 
in line with international accounting standards. Moreover, the company could not fully 
demonstrate  payment  for  its  land  use  rights.  It  did  therefore  not  meet  criterion  3  as 
summarized in recital (24) above either. Accordingly, it could not therefore be granted 
MET. 

(31)  One  unrelated  importer  objected  to  the  granting  of  MET  to  Nu  Air,  on  the  basis  of 
some  alleged  inconsistencies  in  the  audited  accounts  for  2004  and  2005.  Nu  Air, 

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however,  could  show  that there  were no inconsistencies and clarify the points raised 
by that importer. Accordingly, this objection was dismissed. 

(32)  The same importer objected to the granting of MET to FIAC, in view of the fact that 
the  company  had  negotiated  in  2002  a  preliminary  agreement  with  the  regional 
authorities, which would have given them the use of a plot of land without charge for a 
maximum  of  three  years,  pending  the  land's  expropriation  formalities.  However,  the 
agreement expired without FIAC ever making any use of it or acquiring a title for this 
land. On the other hand, FIAC was able to demonstrate that it always paid rental for 
the premises used in its activities. This argument was therefore dismissed. 

(33)  One company (Hongyou) of the group of companies (Hongyou/Taizhou) objected that 
it  should  not  be  refused  MET  due  to  issues  arising  in  another  company  (namely, 
Taizhou). However, on the basis of the Commission Regulation (EEC) No 2454/93 of 
2  July  1993  laying  down  provisions  for  the  implementation  of  Council  Regulation 
(EEC) No 2913/92 establishing the Community Customs code3, Hongyou and Taizhou 
are  to  be  considered  as  related  parties.  Therefore,  as  Taizhou  could  not  be  granted 
MET, Hongyou could not be granted MET neither. 

(34)  On the basis of the above, three of the five Chinese sampled companies or groups of 
companies that had requested MET could not show that they fulfil all the criteria set 
out in Article 2(7)(c) of the basic Regulation.  

(35) 

It was therefore considered that MET should be granted to two companies (FIAC and 
Nu  Air)  and  rejected  for  the  remaining  three  companies/groups  of  companies.  The 
Advisory  Committee  was  consulted  and  did  not  object  to  the  conclusions  of  the 
Commission’s services. 

3. 

Individual treatment (‘IT’) 

(36)  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 
companies are able to demonstrate that they meet all criteria set out in Article 9(5) of 
the basic Regulation. 

(37)  All  exporting  producers  who  requested  MET  also  claimed  IT  in  the  event  that  they 

would not be granted MET. One company (Anlu) had only requested IT. 

(38)  Of  the  four  sampled  companies  or  groups  of  companies  that  could  either  not  be 
granted MET (Xinlei, Honyou/Taizhou, Wealth Shanghai/Nantong Wealth) or had not 
requested  MET  (Anlu),  three  companies  or  groups  (Xinlei,  Anlu  and  Wealth 
Shanghai/Nantong Wealth) fulfilled all the criteria set out in Article 9(5) and could be 
granted IT. 

(39) 

It  was  found  that  Taizhou  failed  to  demonstrate  that  it  cumulatively  met  all  the 
requirements  for  IT  as  set  forth  in  Article  9(5)  of  the  basic  Regulation.  Namely,  the 
severe  problems  with  the  accounting  system  of  the  company  made  it  impossible  to 
verify  whether  the  criterion  stipulated  in  Article  9(5)(b)  of  the  basic  Regulation  that 
export  prices  and  quantities,  and  conditions  and  terms  of  sale  are  freely  determined, 
was fulfilled. 

(40)  The IT claim of Taizhou was thus rejected. 

4.  Normal Value 

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OJ L 253, 11.10.1993, p. 1. 

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4.1.  Companies or groups of companies which could be granted MET 

(41)  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  those 
exporting producers in the sample that could be granted MET whether their 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  their  total  export 
sales volume of the product concerned to the Community. Since the two companies or 
groups  of  companies  had  almost  non-existent  sales  on  the  domestic  market,  it  was 
considered that the product was not sold in representative quantities so as to provide 
an appropriate basis for the establishment of the normal value. 

(42)  Since  domestic  sales  could  not  be  used  in  order  to  establish  normal  value,  another 
method had to be applied. In this regard, the Commission used a constructed normal 
value,  in  accordance  with  Article  2(3)  of  the  basic  Regulation.  Normal  value  was 
constructed  on  the  basis  of  the  companies'  or  groups  of  companies'  manufacturing 
costs  of  the  product  concerned.  When  constructing  normal  value  pursuant  to  Article 
2(3)  of  the  basic  Regulation,  a  reasonable  amount  for  selling,  general  and 
administrative (‘SG&A’) expenses and profit is added to the manufacturing costs. The 
SG&A  expenses  and  profit  could  not  be  established  on  the  basis  of  the  chapeau  of 
Article  2(6)  of  the  basic  Regulation  since  none  of  the  companies  or  groups  of 
companies  had  representative  domestic  sales.  They  could  not  be  established  on  the 
basis of Article 2(6)(a) because there was no other company to which MET could be 
granted. Moreover, SG&A expenses and profits could not be established on the basis 
of Article 2(6)(b) as none of the companies or groups of companies had representative 
sales, in the ordinary course of trade, of the same general category of products. SG&A 
expenses  and  profits  were  therefore  determined  in  accordance  with  Article  2(6)(c) 
('any  other  reasonable  method')  on  the  basis  of  the  SG&A  expenses  and  profits 
incurred  by  the  co-operating  producer  in  the  analogue  country.  Publicly  available 
information  showed  that  this  profit  margin  did  not  exceed  the  profit  made  by  other 
known producers of the same general category of products (i.e. electrical machinery) 
in the PRC during the IP.  

4.2.  Companies or groups of companies which could not be granted MET 

(43)  According  to  Article  2(7)(a)  of  the  basic  Regulation,  normal  value  for  the  exporting 
producers  not  granted  MET  has  to  be  established  on  the  basis  of  the  prices  or 
constructed value in an analogue country. 

(44) 

In the notice of initiation, the Commission indicated that it envisaged using Brazil as 
an appropriate analogue country for the purpose of establishing normal value for the 
PRC. Interested parties were invited to comment on this. No interested parties objected 
to this proposal. 

(45)  There  are  four  known  producers  in  Brazil,  making  about  220 000  compressors  per 
year, and imports are about 30,000 units. The Commission sought co-operation from 
all known producers in Brazil. 

(46)  Two Brazilian producers co-operated in the investigation. One of them is related to a 
Community  producer,  the  FIAC  Group.  The  investigation  showed  that  this  producer 
had  generally  high  prices,  mainly  due  the  fact  that  he  produced  a  small  volume  of 
sophisticated compressors for medical purposes which were not directly comparable to 
the product concerned. Due to the very different characteristics of the product and the 
market, it would be difficult to establish the necessary adjustments in order to use this 

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data as normal value for the Chinese-produced compressors. The second co-operating 
Brazilian producer was found to produce some compressor models comparable to the 
ones  exported  to the  Community  by the Chinese exporting producers. Therefore, the 
prices in the Brazilian market of the comparable models of this Brazilian producer sold 
in the ordinary course of trade were used as a basis for establishing normal value for 
the exporting producers not granted MET. 

5. 

Export price 

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

5.1.  Companies or groups of companies which could be granted either MET or IT 

(48)  Where  export  sales  to  the  Community  were  made  either  directly  to  independent 
customers  in  the  Community  or  through  unrelated  trading  companies,  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. 

(49)  Where  export  sales to  the Community were made through related  trading  companies 
located  in  the  Community,  export  prices  were  established  on  the  basis  of  the  first 
resale  prices  of  these  related  traders  to  independent  customers  in  the  Community, 
pursuant  to  Article  2(9)  of  the  basic  Regulation.  For  the  sales  channelled  through 
related  companies  outside  the  Community,  the  export  price  was  established  on  the 
basis of the first resale prices to independent customers in the Community. 

5.2.  Companies or groups of companies which could not be granted MET/IT 

(50)  For the two sampled Chinese exporting companies that were granted neither MET nor 
IT  (Taizhou  /  Honyou  Group),  the  data  on  their  export  sales  could  not  be  used  to 
establish individual dumping margins for the reasons explained above in recital (29). 
Therefore, a dumping margin was calculated as set out in recital (55). 

6.  Comparison 

(51)  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.  

(52)  On  this  basis,  for  those  Chinese  exporting  producers  that  could  be  granted  MET/IT, 
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.  For  the  other 
companies,  an  average  adjustment  based  on  the  adjustments  mentioned  before  was 
made. 

(53)  For  the  sales  channelled  through  related  traders  based  outside  the  Community,  an 
adjustment  was  applied  in  accordance  with  Article  2(10)(i)  of  the  basic  Regulation, 
where  these  companies  have  been  shown  to  perform  functions  similar  to  that  of  an 
agent working on a commission basis. This adjustment was based on the SG&A of the 
trading companies plus a profit data obtained an unrelated trader in the Community  

7.  Dumping margins 

EN 

11 

   EN 

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

Community border, duty unpaid, are the following: 

Zhejiang Xinlei Mechanical & Electrical Co. Ltd., Wenling 

77,6 % 

Zhejiang Hongyou Air Compressor Manufacturing Co. Ltd., 
Wenling and Taizhou Hutou Air Compressors Manufacturing 
Co. Ltd., Wenling 

Shanghai Wealth Machinery & Appliance Co. Ltd., Shanghai 
and Wealth (Nantong) Machinery Co., Ltd., Nantong 

Zhejiang Anlu Cleaning Machinery Co., Ltd., Taizhou 

Nu Air (Shanghai) Compressor and Tools Co. Ltd., Shanghai 

FIAC Air Compressors (Jiangmen) Co. Ltd., Jiangmen 

Co-operating  companies  not  included  in  the  sample  (listed  in 
Annex) 

All other companies 

76,6 % 

73,2 % 

67,4 % 

13,7 % 

10,6 % 

51,6 % 

77,6 % 

(55)  For the two sampled companies which were granted neither MET nor IT, the dumping 
margin was calculated as a weighted average of the margins established for the three 
companies or groups of companies granted IT but not MET. 

(56)  For the co-operating companies not included in the sample, the dumping margin was 
calculated  as  a  weighted  average  of  the  margins  established  for  all  the  companies  in 
the sample. 

(57)  Given  the  high  level  of  co-operation  (100  %),  referred  to  at  recital  (22)  above,  a 
country-wide average dumping margin was set at the highest level applicable to any of 
the sampled companies. 

1.  Community production  

D. 

INJURY 

(58) 

In the light  of the definition  of Community industry as set out in  Article  4(1)  of the 
basic  Regulation,  the  output  of  the  following  Community  manufacturers  was 
considered for inclusion in the definition of the Community production at the initiation 
of the investigation: 

– 

– 

– 

Four  complainant  Community  manufacturers:  CHINOOK  SpA,  FERRUA 
SYSTEM BLOCK Srl, FIAC SpA and FINI SpA; 

One  other  producer  in  the  Community  who  fully  cooperated  in  the 
investigation and who supported the proceeding: ABAC Aria Compressa SpA 
of  the  ABAC  Group.  It  is  noted  that  the  ABAC  Group  sold  this  company  to 
another company in 2007; 

Six  other  Community  producers  listed  in  the  complaint.  Those  companies 
received a sampling questionnaire, but only one of them expressed the wish to 
further  co-operate  with  the  proceeding  within  the  time  limits  indicated  in  the 

EN 

12 

   EN 

 
notice  of  initiation.  However,  this  producer  stopped  co-operating  shortly 
thereafter and did not provide a full questionnaire reply;  

– 

Twenty  other  manufacturers  listed  in  the  complaint,  which  assemble  the  like 
product  using  parts  produced  by  the  above-mentioned  Community  producers 
and/or imported from third countries. There is also a very limited production of 
the like product coming from manufacturers in the industrial-use compressors 
sector.  Questionnaires  were  sent  to  all  of  them  but  none  replied  to  the 
questionnaire. 

(59)  Two  of  the  complaining  producers  ceased  co-operating  shortly  after  the  initiation  of 

the proceeding and did not reply to the sampling questionnaire.  

Exclusion  of  a  Community  manufacturer  from  the  definition  of  the  Community 
production for reasons of significant imports within the period considered 

(60)  The  investigation  has  shown  that  all  three  co-operating  (groups  of)  companies,  in 
addition  to  their  own  Community  manufacturing,  had  also  imported  increasing 
amounts of the product concerned for resale on the Community market. As shown by 
the  investigation,  all  co-operators  decided  to  delocalise  part  of  their  production,  at 
least for the part that was mostly exposed to the increasing dumped imports from the 
PRC.  The  imports  by  the  co-operating  (groups  of)  companies  were  predominantly 
from their respective related sister companies or subsidiaries established in the PRC.  

(61) 

It was thus examined whether, despite those import volumes, the centre of interest of 
those companies was within the Community. 

(62)  As far as the volume of imports by the co-operating manufacturers in the Community 
is concerned, it was established that two of these (groups of) companies (company A 
and  B)  imported  increasing  but  relatively  low  quantities  of  the  product  concerned 
(throughout  the  period  considered  the  volumes  of  resale  of  the  product  concerned 
originating in the PRC remained inferior to the respective net sales of own production 
of  these  companies).  Moreover,  those  companies  kept  their  headquarters  and  R&D 
activities  in  the  Community.  It  is  therefore  concluded  that  the  centre  of  interest  for 
companies A and B is still in the Community and that despite their imports from the 
PRC they should be considered as part of the Community production. 

(63)  With  regard  to  the  other  co-operating  group  of  companies  (company  C),  it  was 
established that in the period considered not only there was a considerable increase in 
the  proportion  of  the  imported  product  sold  on  the  Community  market,  but  that, 
starting  from  2005,  this  proportion  exceeded  the  volumes  of  the  like  product 
manufactured  and  sold  within  the  Community.  During  the  investigation  period  the 
volumes of resale of the product concerned originating in the PRC constituted the vast 
majority of the total sales of company C on the Community market. 

(64) 

It  was  considered  whether,  despite  the  significant  import  volumes,  the  imported 
volumes could be considered to complement the product range or to be of a temporary 
nature. It appeared, however, that the imports of company C cannot be considered to 
complement the product range, but are based on a strategic decision to outsource the 
production  of  the  product  concerned  to  the  PRC  in  a  move  to  lower  the  cost  of 
production and to be in a position to compete with the other Chinese imports. It was 
established  that  during  the  investigation  period  many  models  produced  in  the  PRC 
were  also  produced  in  Italy  by  another  company  of  the  same  group.  Therefore,  the 
compressors  produced  in  the  PRC  were  in  direct  competition  with  compressors 
produced  by  the  same  group  in  Italy.  In  view  of  the  above  and  considering  the 

EN 

13 

   EN 

 
significance  of  resale  of  imported  products  in  the  total  sales  of  company  C,  it  could 
thus not be concluded that company C's centre of interest for the manufacturing of the 
product  concerned  is  still  within  the  Community.  It  appeared  likely  that  company  C 
would  continue  or  even  increase  imports  of  the  like  product  from  the  country 
concerned for the resale on the Community market, which would mean that company 
C should be considered as an importer rather than a Community producer. 

(65)  Therefore, it is concluded that company C should not be included in the definition of 

Community production. 

(66)  To conclude, the Community production of certain compressors within the meaning of 
Article 4(1) of the basic Regulation has been defined as all the production by all the 
companies referred to in recital (58), minus the production of the company C. In the 
absence of co-operation of a number of producers and assemblers in the Community, 
the output was estimated on the basis of information gathered during the investigation 
and data submitted in the complaint. 

2.  Community industry 

(67)  The proceeding was initiated as a result of a complaint lodged by the Italian federation 
ANIMA  representing  four  companies  manufacturing  compressors  and  one  producer 
supporting  the  complaint  (as  detailed  in  the  recital  (58)  above).  Despite  the  above-
mentioned lack of co-operation from two complaining companies and the exclusion of 
one  Community  manufacturer  from  the  definition  of  the  Community  production,  the 
two remaining Community producers that properly co-operated with the investigation 
were found to  account  for a  major  proportion of the total Community production, in 
this  case  around  50  %.  These  two  co-operating  producers  are  therefore  deemed  to 
constitute  Community  industry  within  the  meaning  of  Articles  4(1)  and  5(4)  of  the 
basic Regulation. 

(68)  The  remaining  producers  listed  in  the  complaint  and  detailed  in  recital  (58)  above, 
minus  the  company  excluded  from  the  definition  of  the  Community  production,  will 
be  hereinafter  referred  to  as  'the  other  Community  producers'.  None  of  these  other 
Community producers opposed the complaint. 

3.  Community consumption 

(69)  Community  consumption  was  established  on  the  basis  of  the  sales  volumes  of 
company  C's  and  the  Community  industry's  own  production  destined  for  the 
Community market, the import volumes data on the Community market obtained from 
Eurostat  and,  concerning  the  sales  of  the  other  Community  producers  from 
information available in the complaint. 

(70)  Throughout the period considered, the Community market for the product concerned 
and the like product has declined by 6 % reaching in the IP around 3 066 000 pieces. 
More  specifically,  the  Community  consumption  decreased  in  2004  by  7  %  before 
increasing slightly by 1 percentage point in 2005 and it stabilised at this level in the IP. 
The drop in the Community consumption can be attributed to the shrinking sales of the 
producers in the Community and to reduced imports from other third countries (mainly 
US and Japan).  

EU Consumption (pieces) 

3 270 283

3 053 846

3 075 358 

3 065 898

2003 

2004 

2005 

IP 

EN 

14 

   EN 

 
 
Index 

100

93

94 

94

4. 

Imports from the country concerned 

(a)  Volume 

(71)  The volume of imports of the product concerned into the Community rose massively 
between  2003  and  the  IP.  They  rose  during  the  period  considered  by  182  %  and 
reached over 1 600 000 pieces. In detail, imports from the country concerned increased 
by 66 % between 2003 and 2004, by a further 110 percentage points in 2005, and by 6 
percentage points in the IP. 

(b)  Market share 

(72)  The market share held by exporters in the country concerned increased by more than 
35 percentage  points  throughout  the  period  considered  and  reached  53  %  in  the  IP. 
The  Chinese  exporters  increased  their  market  share  between  2003  and  2004  by 
13 percentage  points  and  by  another  20  percentage  points  in  2005.  In  the  IP,  the 
market share of the exporters from the country concerned increased slightly by another 
percentage point. 

2003 

2004 

2005 

IP 

Volume  of  imports  from 
the PRC (pieces) 

574 795

953 001

1 586 614 

1 622 702

Index 

100

166

276 

282

Market  share  of  imports 
from the PRC 

(c)  Prices 

(i) 

Price evolution  

17,6 %

31,2 %

51,6 % 

52,9 %

(73)  Prices of the imports of the product concerned in the table below are based on the data 
submitted by co-operating exporters and verified during the investigation. During the 
period considered, there was an overall increase of the average price of imports of the 
product concerned originating in the PRC that rose by 6 % between 2003 and the IP. 
The increasing price trend is possibly a reflection of the change in the product mix, as 
Chinese manufacturers gradually start the production and export of more advanced and 
more expensive compressors. 

Price  of  imports  from  the 
PRC (EUR/piece) 

2003 

2004 

2005 

IP 

35,15

34,61

35,70 

37,27

Index 

100

98

102 

106

(ii)  Price undercutting  

(74)  A comparison for comparable models of the product concerned was made between the 
sampled exporting producers' and the Community industry's average selling prices in 
the  Community.  To  this  end,  Community  industry’s  ex-works  prices  to  unrelated 

EN 

15 

   EN 

 
 
 
customers, net of all rebates and taxes have been compared with the CIF Community 
frontier prices of exporting producers of the People's Republic of China, duly adjusted 
for unloading and customs clearance costs. Given that Community industry normally 
sells  its  Community  production  directly  to  retailers,  whereas  the  Chinese  goods  are 
sold to retailers via related or unrelated importers and/or traders, an adjustment to the 
import price was made where appropriate to ensure that the comparison is made at the 
same level of trade. The comparison showed that during the IP the product concerned 
sold  in  the  Community  undercut  the  Community  industry's  prices  by  between  22  % 
and 43 %, depending on the exporter concerned. 

5. 

Situation of the Community industry 

(75)  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.  

(76)  Given that the Community industry comprises only two producers, data relating to the 
Community  industry  is  presented  in  an  indexed  format  and/or  in  ranges  in  order  to 
preserve confidentiality, pursuant to Article 19 of the basic  Regulation. It  is  recalled 
that  the  data  presented  below  only  refers  to  the  like  product  produced  in  the 
Community  by  the  Community  industry,  thereby  excluding  stand-alone  pumps  and 
compressors manufactured by the related companies of the Community industry in the 
PRC and subsequently resold in the Community.  

(a)  Production 

(77)  The  Community  industry's  production  decreased  significantly  between  2003  and  the 
IP. Specifically, it declined by 16 % in 2004, by a further 23 percentage points in 2005 
and  another  7  percentage  points  in  the  IP.  In  the  IP  the  Community  industry's 
production volume ranged between 300 000 pieces and 400 000 pieces. 

2003 

2004 

2005 

IP 

Production (pieces) 

Cannot be disclosed 

Index 

100

84

61 

54

(b)  Capacity and capacity utilisation rates 

(78)  The production capacity increased slightly by 3 % between 2003 and 2004, increased 
further  by  9  percentage  point  in 2005  and stabilised on that level during the IP. The 
increase in the production capacity in 2005 is attributable to the investment made by 
one Community producer into an additional production line for compressors serving a 
higher  segment  of  the  market.  During  the  IP,  the  Community  industry's  production 
capacity ranged between 600 000 pieces and 800 000 pieces. 

(79)  The  capacity  utilisation  rate  of  the  Community  industry  constantly  fell  during  the 
period considered and in the IP it was less than half of its level in 2003. This reflects a 
fall  in  the  production  levels.  During  the  IP  the  Community  industry's  capacity 
utilisation ranged between 40 % and 50 %. 

Production capacity 

Cannot be disclosed 

2003 

2004 

2005 

IP 

EN 

16 

   EN 

 
 
 
(pieces) 

Index 

100

103

112 

112

Capacity utilisation 

Cannot be disclosed 

Index 

(c) 

Stocks 

100

81

54 

48

(80)  The  level  of  closing  stocks  increased  in  2004  by  37  %,  by  a  further  45  percentage 
points in 2005, before decreasing by 138 percentage points in the IP. During the IP the 
Community industry's stocks ranged between 10 000 and 20 000 pieces. Considering 
that  the  production  of  the  like  product  in  the  Community  is  predominantly  done  on 
order, the level of inventories is not considered to be a useful injury indicator for this 
product. 

2003 

2004 

2005 

IP 

Closing stocks (pieces) 

Cannot be disclosed 

Index 

100

137

182 

44

(d)  Sales volume 

(81)  The sales by the Community industry of its own production on the Community market 
steadily  decreased  throughout  the  period  considered.  Specifically,  it  fell  by  19  %  in 
2004, by a further 24 percentage points in 2005 and by another 9 percentage points in 
the IP. During the IP the sales volume of the Community industry ranged between 200 
000 pieces and 300 000 pieces. 

2003 

2004 

2005 

IP 

EC sales volume (pieces) 

Cannot be disclosed 

Index 

100

81

57 

48

(e)  Market share 

(82)  The  market  share  of  the  Community  industry  constantly  declined  throughout  the 
period  considered.  In  detail,  the  index  reflecting  the  evolution  of  the  Community 
industry's market share fell by 13 % in 2004, by 27 percentage points in 2005 and by a 
further 9 percentage points in the IP. During the IP the market share of the Community 
industry ranged between 5 % and 10 %. 

2003 

2004 

2005 

IP 

of 
Market 
Community industry 

share 

the 

Cannot be disclosed 

Index 

(f)  Growth 

100

87

60 

51

EN 

17 

   EN 

 
 
 
 
(83)  Between 2003 and the IP, when the Community consumption decreased by 6 %, the 
volume of sales of the Community industry on the Community market decreased much 
more  by  a  massive  52  %.  During  the  period  considered  the  Community  industry's 
market  share  almost  halved,  while  dumped  imports  gained  more  than  35  percentage 
points of market share, reaching 53 %. It is thus concluded that there was no growth 
from which the Community industry could have benefited. 

(g)  Employment 

(84)  The employment level of the Community industry showed a steady decline throughout 
the period considered. It decreased by 10 % in 2004, by further 16 percentage points in 
2005,  and  by  another  5  percentage  points  in  the  IP.  During  the  IP,  the  Community 
industry's employment devoted to the production and sales of the like product ranged 
between 150 and 200 persons. 

Employment 

Index 

(h)  Productivity 

2003 

2004 

2005 

IP 

Cannot be disclosed 

100

90

74 

69

(85)  The productivity of the Community industry's workforce, measured as output (pieces) 
per  person  employed  per  year,  declined  in  2004  by  7  %,  by  a  further  10  percentage 
points  in  2005,  and  by  another  5  percentage  points  in  the  IP.  During  the  IP,  the 
productivity  of  the  Community  industry  ranged  between  1500  and  2000  pieces  per 
employee.  The  steady  decrease  in  the  productivity  is  a  reflection  of  the  declining 
production  that  was  falling throughout the period considered on  a somewhat quicker 
pace than the corresponding employment. 

2003 

2004 

2005 

IP 

Productivity 
employee) 

(pieces  per 

Cannot be disclosed 

Index 

100

93

83 

78

(i) 

Labour costs 

(86)  The average labour cost per employee increased by 8 % between 2003 and 2004 and 
stabilised on that level in 2005 before slightly decreasing the IP by 1 percentage point. 
The  2004  increase  was  due  in  particular  to  a  wage  rise  negotiated  by  one  of  the 
Community industry producers following a dispute with its trade unions. In addition, 
this negotiated increase in wages was preceded by a strike in 2003 and the resulting 
unpaid hours relatively lowered the annual labour cost in comparison to the following 
years.  

2003 

2004 

2005 

IP 

Annual 
employee (EUR) 

labour  cost  per 

Cannot be disclosed 

EN 

18 

   EN 

 
 
 
 
Index 

100

108

108 

107

(j)  Factors affecting Community prices 

(87)  The  unit  prices  of  the  Community  industry's  sales  of  own  production  to  unrelated 
customers increased by 20 % between 2003 and the IP. Specifically, the average sales 
price  increased  by  9  %  in  2004,  by  a  further  13  percentage  points  in  2005,  before 
slightly  dropping  by  2  percentage  points  in  the  IP.  During  the  IP,  the  average  unit 
price ranged between 100 and 150 EUR. 

2003 

2004 

2005 

IP 

Unit  price  EC  market 
(EUR) 

Cannot be disclosed 

Index 

100

109

122 

120

(88)  The  increase  in  the  average  unit  price  is  a  reflection  of  the  Community  industry's 
gradual partial shift of the production towards upper segment of the market, i.e. higher 
quality,  better  performance,  bigger  capacity  and  consequently  more  costly  and 
expensive models of the like product. 

(89)  Given the volume and the level of price undercutting, these imports were certainly a 

factor affecting prices.  

(k)  Profitability and return on investments 

(90)  During  the  period  considered  the  profitability  of  the  Community  industry's  own 
production sales in the Community, expressed as a percentage of net sales, remained 
negative  but  improved  throughout  the  period  considered.  The  negative  profitability 
improved  in  2004  and  further  in  2005  when  the  level  of  losses  was  relatively  the 
lowest and only slightly deteriorated in the IP. During the IP, the profitability of the 
Community industry ranged between -3 % and -10 %. 

2003 

2004 

2005 

IP 

Profitability  of  EC  sales 
(% of net sales) 

Cannot be disclosed 

Index 

-100

-93

-28 

-32

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

Cannot be disclosed 

Index 

-100

-85

-19 

-20

(91)  The  return  on  investment  (ROI),  expressed  as  the  profit  in  percent  of  the  net  book 
value of investments, followed the above profitability trend. It also remained negative 
during the period considered. It improved in 2004 and further in 2005, before slightly 
deteriorating in the IP. In the IP, the ROI ranged between -30 % and -15 %. 

(l)  Cash flow 

EN 

19 

   EN 

 
 
 
(92)  The  net  cash  flow  for  operating  activities  remained  also  negative  through  the  period 
considered,  but  clearly  improved  and  was  only  slightly  negative  in  the  IP,  ranging 
between -100 00 and 0 EUR. 

2003 

2004 

2005 

IP 

Cash Flow (EUR) 

Cannot be disclosed 

Index 

-100

-67

-9 

-1

(m) 

Investment and ability to raise capital  

(93)  The  Community  industry's  annual  investment  in  the  production  of  the  like  product 
increased  in  2004  by  72  %  and  by  a  further  75  percentage  points  in  2005,  before 
slightly declining by 7 percentage points in the IP. The net investment during the IP 
was, however, relatively low and ranged between 1 300 000 EUR and 2 300 000 EUR. 
The  increase  can  be  attributed  to  an  investment  made  by  one  of  the  Community 
producers  for  leasing  a  new  building  with  a  view  to  centralise  and  modernise  the 
production  process  as  well  as  some  investment  by  the  Community  industry  intended 
for  maintenance  and  renewal  of  existing  equipment  but  also  in  new  equipment  and 
modules  in  an  attempt  to  improve  competitiveness  of  their  product  vis-à-vis  the 
dumped imports from China. 

2003 

2004 

2005 

IP 

Net investments (EUR) 

Cannot be disclosed 

Index 

100

172

247 

240

(94)  No  evidence  was  provided  to  the  Commission  in  respect  of  a  reduced  or  increased 

ability to raise capital over the period considered.  

(n)  Magnitude of dumping margin 

(95)  Given  the  volume,  the  market  share  and  the  prices  of  the  imports  from  the  country 
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 

(96) 

In the absence of  any information  on the existence of dumping prior to the situation 
assessed in the present proceeding, this factor is considered irrelevant.  

6.  Conclusion on injury 

(97)  Between 2003 and the IP, the volume of the dumped imports of the product concerned 
originating  in  the  PRC  increased  massively,  by  182  %  and  their  share  of  the 
Community  market  grew  by  over  35  percentage  points.  The  average  prices  of  the 
dumped  imports  were  considerably  lower  than  those  of  the  Community  industry 
during the period considered. Moreover, during the IP, the prices of imports from the 
PRC significantly undercut those of the Community industry. On a weighted average 
basis, price undercutting was in the IP, between 22 % and 43 %. 

(98)  Some  indicators  experienced  a  positive  development  between  2003  and  the  IP. 
Average unit sales price increased by 20 %, the production capacity indicator rose by 

EN 

20 

   EN 

 
 
 
12 %  and  there  was  an  increase  in  the  investment  by  140  %.  However,  it  has  been 
shown  in  recitals  (78),  (88)  and  (93)  above  that  particular  reasons  explain  these 
developments.  In  addition,  as  indicated  above  in  recital  (90),  the  profitability 
throughout  the  period  considered  showed  signs  of  recovery  as  losses  declined 
significantly  between  2003  and  the  IP.  However,  it  is  to  be  remembered  that  the 
profitability remained negative and the level of losses in the IP cannot be considered 
negligible. 

(99)  A significant deterioration in the situation of the Community industry has been found 
over  the  period  considered.  Most  of  the  injury  indicators  developed  negatively 
between  2003  and  the  IP:  production  volume  declined  by  46  %,  capacity  utilisation 
more  than  halved,  Community  industry's  sales  declined  by  52  %  and  the 
corresponding  market  share  almost  halved,  employment  decreased  by  31  %,  and 
productivity fell by 22 %.  

(100)  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 

(101)  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. 

Effects of the dumped imports 

(102)  The significant increase in the volume of the dumped imports by 182 % between 2003 
and  the  IP,  and  of  its  corresponding  share  of  the  Community  market,  i.e.  by  35 
percentage points, as well as the undercutting found (between 22 % and 43 % during 
the  IP)  generally  coincided  with  the  deterioration  of  the  economic  situation  of  the 
Community  industry,  as  explained  in  recital  (99)  above.  In  addition,  dumped  prices 
were, on average, considerably below those of the Community industry throughout the 
period  considered.  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 profit and that the dumped 
imports had a significant negative impact on the situation of the Community industry. 
Moreover, it appears that the Community industry lost a significant part of its market 
share to those increased volume of dumped imports. The decreased sales volumes lead 
to a relative increase of the fixed costs of the CI which had a negative impact on the 
financial situation as well. Therefore, there is a clear causal link between imports from 
the PRC and the material injury suffered by the Community industry. 

3. 

Effects of other factors 

Export performance of the Community industry 

(103)  As  can  be  seen  from  the  table  below,  during  the  period  considered  there  was  a 
decrease by 33 % of the volume of export sales, which however was not as profound 
as  the  decrease  of  the  EC  sales,  described  in  recital  (81)  above.  During  the  IP  the 
export  sales  ranged  between  100  000  pieces  and  150  000  pieces.  The  average  unit 

EN 

21 

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price of export sales remained stable between 2003 and the IP and ranged between 100 
and 150 EUR. 

2003 

2004 

2005 

IP 

Export sales (pieces) 

Cannot be disclosed 

Index 

100

89

74 

77

Export unit price (EUR) 

Cannot be disclosed 

Index 

100

100

102 

100

(104)  Given the price stability on the export markets and the relatively smaller drop in the 
export volumes, it is considered that even if export activity might have contributed to 
the injury suffered by the Community industry, but did not do so to such an extent as 
to break the causal link.  

Rise in the costs of production  

(105)  One interested party claimed that the rise in the costs of production of the Community 
industry could not have been caused only by the rise in the price of the raw materials 
(notably metal parts), but also by other causes thereby pointing to self-inflicted injury. 
It is noted that that party was not specific about the causes which would point to self-
inflicted injury. 

(106)  The investigation showed that the unit costs of production of the Community industry 
have increased by around 8 % between 2003 and the IP. The increase could be partly 
attributed to the apparent rise in the price of raw materials. The investigation showed 
that  some  part  of  the  cost  increase  is  due  to  the  deteriorated  cost  structure  and  in 
particular  the  unit  fixed  costs,  that  rose  as  a  result  of  significant  reduction  in  the 
number  of  units  produced.  Still,  the  bulk  of  the  increase  is  to  be  attributed  to  the 
noticeable  rise  in  the  price  of  components  used  for  the  production  of  models  in  the 
upper segment of the market.  

(107)  However,  the  rise  in  the  average  unit  cost  of  production  has  been  more  than 
compensated by the increase of the average unit selling price (see recital (87) above) 
that resulted in improvement of (although still negative) profitability, as described in 
recital  (90).  It  therefore  considered  that  the  rise  in  the  cost  of  production  did  not 
contribute to the injury suffered by Community producers. 

Imports from other countries 

(108)  Based on Eurostat data, the volume of imports into the Community of the like product 
originating  from  the  rest  of  the  world  (i.e.  excluding  the  PRC)  declined  by  33  %  in 
2004,  by  a  further  7  percentage  points  in  2005,  before  recovering  slightly  by 
9 percentage points in the IP. Overall, the drop between 2003 and the IP amounts to 
31 %.  The  corresponding  market  share  held  by  imports  from  the  rest  of  the  world 
declined from 35 % in 2003 to 26 % in the IP. 

(109)  No detailed information was available concerning the price of imports from the rest of 
the world. Given that Eurostat data does not take account of the product mix, this data 
could  not  be  used  for  any  reasonable  comparison  with  the  Community  industry's 
prices. The investigation did not give any indication that the prices of imports from the 
rest of the world would undercut the Community prices.  

EN 

22 

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(110)  Given the declining volume and market share and given the lack of any evidence to the 
contrary, it is concluded that imports from the rest of the world did not cause material 
injury, if at all, to the Community industry. 

Imports  from  the  rest  of 
the world (pieces) 

2003 

2004 

2005 

IP 

1 164 228

780 921

699 129 

807 893

Index 

100

67

60 

69

Market  share  of  imports 
from the rest of the world 

35,6 %

25,6 %

22,7 % 

26,4 %

Competition from other producers in the Community 

(111)  As indicated under recital (65) above, one producer in the Community was excluded 
from the definition of the Community production. In addition, a number of producers 
and  assemblers  did  not  co-operate  in  this  proceeding  (see  recital  (58)).  Based  on 
information  obtained  in  the  course  of  the  investigation  from  co-operating  producers 
and  the  complaint,  it  is  estimated  that  sales  volumes  of  these  other  producers  in  the 
Community  for  the  EC  market  was  around  1  000 000  pieces  in  the  year  2003  and 
declined significantly throughout the period considered, reaching about 400 000 pieces 
in  the  IP.  Similarly,  the  corresponding  market  share  declined  throughout  the  period 
considered  from  31  %  in  2003  to13  %  in  the  IP.  These  producers  therefore  did  not 
gain any sales volume and market share at the expense of the Community industry. To 
the contrary, similarly to the Community industry, they lost a big portion of their sales 
and market share to the dumped imports from China. 

(112)  Given the above, and given the absence of information to the contrary, it is concluded 
that other producers in the Community have not contributed to the injury suffered by 
the Community industry. 

2003 

2004 

2005 

IP 

sales 

of 
in 

other 
EC 
producers 
the 
Community  (estimation  in 
pieces) 

1 039 780

919 375

510 659 

399 891

Index 

100

88

49 

38

Market  share  of  other 
the 
producers 
Community 

in 

31,4 %

29,7 %

16,4 % 

12,9 %

Decline of consumption on the Community market 

(113)  As  seen  under  recital  (70)  above,  consumption  declined  by  about  200  000  pieces  or 
6 % throughout the period considered. However, it is to be noted that during the same 
period, the decline in the Community industry's sales on the Community market was 
much more profound both in absolute (sales dropped by between 250 000 and 300 000 
pieces) and relative terms (sales dropped massively by 52 %). At the same time, while 

EN 

23 

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the  Community  industry  lost  almost  half  of  its  market  share  (see  recital  (82)),  the 
market share of the Chinese compressors increased by 35 percentage points (see recital 
(71)).  It  is  thus  concluded  that  the  decline  of  consumption  did  not  cause  the  injury 
suffered by the Community industry. 

4.  Conclusion on causation 

(114)  The  coincidence  in  time  between,  on  the  one  hand,  the  massive  increase  in  dumped 
imports  from  the  PRC,  the  corresponding  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.  

(115)  The  investigation  showed  that  the  export  performance  of  the  Community  industry 
might have contributed to a limited degree to the injury suffered, but not to an extent 
that would break the causal link. Other known factors were analysed but were found 
not  to  have  contributed  to  the  injury  suffered.  The  rise  in  the  unit  cost  of  the 
production  of  the  Community  industry  was  found  to  be  more  than  offset  by  the 
simultaneous increase in the selling price, and it was consequently considered that it 
could not have contributed to the injury suffered. As concerns imports from other third 
countries, given their declining volumes and market share and in view of the lack of 
possibility for a proper price comparison with the Community prices, it was concluded 
that  these  imports  did  not  cause  the  injury.  Concerning  competition  from  the  other 
producers  in  the  Community,  given  their  declining  sales  volumes  and  lost  market 
share to the dumped imports, it was established that their activity did not contribute to 
the  injury  suffered.  Regarding  the  decline  in  consumption,  given  that  it  was  smaller 
than the decrease in sales in the Community of the Community producers and that it 
coincided  with  the  significant  increase  of  the  dumped  imports  from  China,  it  was 
concluded that it, as such, did not cause the injury.  

(116)  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 have caused material injury to the Community industry within 
the meaning of Article 3(6) of the basic Regulation. 

F. 

COMMUNITY INTEREST 

(117)  The  Council  and  Commission  examined  whether  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 Council and Commission considered the likely impact of measures for 
all parties concerned. The Commission services originally sent a final disclosure in the 
sense of Article 20 paragraph 4, first sentence, of the basic Regulation, in which the 
orientation was not to impose measures. Pursuant to that disclosure, certain operators, 
in  particular  two  co-operating  producers  in  the  Community,  put  forward  certain 
arguments  which  have  led  to  a  re-examination  of  the  issue.  The  most  important  of 
these arguments will be discussed below.  

1. 

Interest of co-operating producers in the Community 

(118)  Without  prejudice  to  the  definition  of  Community  industry  (see  recital  (67)),  it  is 
important to bear in mind that, as mentioned in recital (60), all co-operating groups of 
companies  in  the  Community  set  up  production  facilities  in  the  PRC  and  imported 

EN 

24 

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increasing amounts of the product concerned for resale on the Community market. As 
mentioned  in  recital  (58),  one  group  of  companies  sold  its  Community-based 
production facility to another company in 2007, i.e. after the IP. Considering that it is 
a  post-IP  development  and  that  throughout  the  period  considered  this  group  was 
manufacturing the like product in the Community, its interests are discussed under this 
heading and the group is referred to as a producer in the Community. 

(119)  The  investigation  showed  that  should  measures  not  be  imposed,  the  Community 
industry  would  possibly  continue  to  suffer  injury.  Indeed,  there  would  likely  be  a 
further deterioration of the situation of the Community industry and a further decline 
of their market share.  

(120)  On the other hand, if measures were to be imposed, this could allow for an increase in 
prices  and/or  sales  volumes  (and  market  share)  which  would  in  turn  provide  the 
Community  industry  with  the  possibility  to  improve  its  financial  and  economic 
situation.  

(121)  As far as the possible development of the market share of the Community industry is 
concerned,  should  measures  be  imposed,  it  is  to  be  noted  that  all  co-operating 
producers claimed during the proceeding that this would result in reversing the current 
process of delocalisation and in moving (at least some part of) the production back to 
the Community.  

(122)  In  this  regard,  the  analysis  of  the  detailed  data  submitted  by  two  co-operating 
producers in the Community and their related subsidiaries in the PRC clearly showed 
that in the particular economic situation prevailing in the PRC over the last few years, 
there  were  important  cost  differences  in  favour  of  producing  the  product  concerned 
destined for the Community market in the PRC rather than in the Community. These 
differences  and  the  dumping  practiced  by  the  Chinese  exporters  in  the  Community 
market might have led all co-operating producers in the Community to delocalise (part 
of) their production in the first place.  

(123)  It was therefore examined whether the imposition of anti-dumping duties, which in the 
case of the exporters related to the producers mentioned in recital (122) are relatively 
low,  would,  regarding  at  least  two  of  the  co-operating  producers,  change  the  main 
economic parameters that have led to the process of delocalisation. It was established 
that  the  full  cost  of  compressors  sold  in  the  Community  and  produced  in  the  PRC 
(including,  inter  alia,  manufacturing  costs,  selling,  general  and  administrative 
expenses,  ocean  freight,  conventional  duty  and  a  possible  anti-dumping  duty)  would 
be  in  the  same  order  of  magnitude,  although  slightly  lower,  as  the  full  cost  of 
producing and selling alike compressors in the Community.  

(124)  Moreover, these two companies reiterated their position that should measures reduce 
the  level  of  price  undercutting  suffered  from  the  Chinese  dumped  products,  they 
would  be  in  a  position  to  increase  and/or  restart  their  production  in  the  Community 
using the existing idle capacities.  

(125)  Therefore, it cannot be excluded, as claimed by two of the co-operating producers in 
their  submissions  following  the  disclosure,  that  those  producers  could  use  their 
substantial spare capacities in Europe. This appears to be possible in view of the fact 
that the proposed measures would come close to levelling the cost of goods, delivered 
onto  the  Community  market,  produced  in  the  PRC  and  in  the  Community. 
Consequently,  it  can  not  be  excluded  that  those  producers  will  increase  their 
production in the Community as a consequence of the imposition of measures. Finally, 

EN 

25 

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it can not be excluded that, if duties on exports from their related producers in the PRC 
would  reduce  the  difference  in  the  cost  of  the  goods  delivered  to  the  Community 
market, produced in the PRC and in the Community, those producers would prefer not 
to  concentrate  all  production  outside  of  the  Community,  in  order  to  specialise 
production of certain models in certain locations, or to diversify risk.  

(126)  As far as a third co-operating producer is concerned, its related company in the PRC 
was not included in the sample for calculating dumping margins and would therefore, 
in  case  of  imposing  measures,  fall,  in  principle,  under  the  average  duty  of  51,8 % 
applicable to co-operating, non-sampled companies. Given that it was not included in 
the  sample,  the  Commission  does  not  possess  verified  information  regarding  the 
production costs of that Chinese company. Therefore, it cannot be excluded that in that 
case  the  full  cost  of  compressors  sold  in  the  Community  and  produced  in  the  PRC 
(including,  inter  alia,  manufacturing  costs,  selling,  general  and  administrative 
expenses,  ocean  freight,  conventional  duty  and  possible  anti-dumping  duty)  would 
exceed the full cost of producing and selling alike compressors in the Community.  

(127)  Following disclosure, the Italian association of compressor manufacturers that lodged 
the complaint (ANIMA) stressed the need for the anti-dumping measures in order to 
allow the producers to continue manufacturing in the Community and their economic 
survival.  They  made  it  clear  that  even  if  the  related  Chinese  suppliers  of  some 
European  producers  would  be  subject  to  relatively  high  anti-dumping  duties,  they 
would still be in favour of imposing measures. 

(128)  An  evaluation  of  the  potential  benefit  of  the  Community  industry  in  case  measures 
were  imposed  was  carried  out.  It  has  been  noted  that  not  imposing  measures  might 
lead to a further deterioration of the situation of the Community industry and further 
decline of their market share. This would probably lead to the loss of a number of jobs 
as  well  as  of  the  investment  that  had  been  made  to  build  production  capacity  in  the 
Community. These elements also, although difficult to quantify, need to be taken into 
account  in  the  overall  assessment  of  the  Community  interest.  On  the  other  hand, 
should anti-dumping duties be imposed, it cannot be excluded that an increase in the 
production  in  the  Community  may  occur,  possibly  involving  a  relocation  of  some 
portion  of the  production  back to the  Community.. This could lead to an increase of 
employment and may have an additional impact on the upstream industry, supplying 
semi-finished products to the Community producers of compressors.  

2. 

Interest of other Community producers 

(129)  These producers did not co-operate in the investigation. Their market share is similar 
to the one held by the Community industry. In view of the lack of co-operation and the 
fact  that  most  of  these  producers  did  not  take  any  clear  position  on  this  proceeding, 
there  are  no  indications  of  what  would  be  the  interest  of  these  producers.  Following 
disclosure one non co-operating producer and two complaining producers that did not 
co-operate further in this proceeding (see recital (59)) as well as the Italian association 
of  compressor  manufacturers  (ANIMA)  came  forward  to  repeat  the  arguments 
mentioned  in  recital  (127)  above.  They  clearly  stated  that  they  are  in  favour  of 
imposing measures. 

3. 

Interest  of  (unrelated) 
operators in the Community 

importers,  consumers  and  other  economic 

(130)  During the IP, the only co-operating unrelated importer imported around 20 % of the 
Community’s total import volume of the product concerned originating in the PRC. In 

EN 

26 

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the absence of alternative co-operation and given the above percentage, this importer 
is  deemed  representative  of  the  situation  of  unrelated  importers.  This  co-operating 
party indicated that it is against the imposition of anti-dumping measures on imports 
of  this  particular  product  from  the  PRC.  During  the  IP,  the  activity  of  resale  of  the 
product  concerned  accounted  for  between  2  %  and  8  %  of  this  importer's  total 
company  turnover.  In  terms  of  workforce,  between  30  and  70  persons  are  directly 
involved in the purchasing, trading and resale of the product concerned.  

(131)  Co-operation  was  also  sought  from  consumer  associations  as  well  as  all  known 
retailers,  distributors,  traders  and/or  other  economic  operators  involved  in  the 
distribution chain in the Community. However, no co-operation was obtained. Given 
that only one unrelated importer co-operated in this proceeding and given the lack of 
participation  of  any  other  economic  operators  in  the  Community  or  consumer 
associations, it was considered appropriate to analyse a global, overall potential impact 
of possible measures on all these parties. Overall, it was concluded that the situation of 
consumers  and  economic  operators  involved  in  the  distribution  chain  in  the 
Community could be negatively affected by the possible measures. 

4.  Conclusion on Community interest 

(132)  For the reasons expressed in recital (125) and (126), in this specific case, it can not be 
excluded that the co-operating producers in the Community might take the opportunity 
to  benefit  from  the  measures  by  recovering  some  of  the  production  lost  due  to  the 
injurious dumping by utilising the existing idle capacities. 

(133)  It is recognised that, imposition of measures may have a negative effect on consumers 
and all economic operators in the distribution chain in the Community. However, it is 
also clear that if production in the Community is increased (and, therefore, probably, 
the number of people employed in this production in the Community is increased) the 
measures would create certain benefits for the Community.  

(134)  Article 21 of the basic Regulation refers to the need to give special consideration to the 
need  to  remedy  the  trade  distorting  effects  of  injurious  dumping  and  to  restore 
effective competition, although this particular provision has to be seen in the overall 
framework of the Community interest test as laid down in the aforementioned Article. 
Thus,  the  effects  of  imposing  measures  or  not  imposing  measures  on  all  parties 
concerned have to be examined.  

(135)  In conclusion, in view of the high dumping and injury margins, it is considered that, in 
this  particular  case,  on  the  basis  of  the  information  submitted  there  is  not  enough 
evidence  to  conclude  that  the  possible  imposition  of  measures  would  be  clearly 
disproportionate and against the Community interest.  

(136)  Should, however, in spite of the imposition of duties, the situation prevailing prior to 
the imposition of measures (in particular the 53 % market share of imports from the 
PRC  and  the  relatively  small  market  share  of  co-operating  producers  in  the 
Community)  remain  unchanged,  the  cost  of  the  possible  duty  to  be  borne  by 
consumers  and  economic  operators  in  the  Community  (including  importers,  traders 
and retailers) might be considered, in the long run, to be greater than the benefit for the 
Community  industry.  Therefore,  the  measures  will  be  imposed  for  two  years,  and 
certain reporting requests will be made to, in particular, Community producers. 

G. 

DEFINITIVE MEASURES 

Estimated injury elimination level 

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27 

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(137)  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. Given 
that  the  Community  industry  was  not  profitable  with  regard  to  the  like  product 
throughout the entire period under consideration, it was considered that a profit margin 
of 5 % achieved by this industry on other products of the same category they produced 
and sold during the IP, is an appropriate level that the Community industry could be 
expected  to  obtain  also  with  regard  to  the  like  product  in  the  absence  of  injurious 
dumping. 

(138)  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.  

(139)  The above-mentioned price comparison showed that the calculated injury margins are 
between  61,3  %  and  160,8  %  and  in  case  of  all  companies  are  higher  than  the 
respective dumping margins. 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  certain  compressors  originating  in  the  PRC  at  the 
level of the dumping margins.  

Definitive measures 

(140)  Consequently, the anti-dumping duties should be as follows: 

Zhejiang Xinlei Mechanical & Electrical Co. Ltd., Wenling 

77,6 % 

Zhejiang Hongyou Air Compressor Manufacturing Co. Ltd., 
Wenling and Taizhou Hutou Air Compressors Manufacturing 
Co. Ltd., Wenling 

Shanghai Wealth Machinery & Appliance Co. Ltd., Shanghai 
and Wealth (Nantong) Machinery Co., Ltd., Nantong 

Zhejiang Anlu Cleaning Machinery Co., Ltd., Taizhou 

Nu Air (Shanghai) Compressor and Tools Co. Ltd., Shanghai 

FIAC Air Compressors (Jiangmen) Co. Ltd., Jiangmen 

Co-operating  companies  not  included  in  the  sample  (listed  in 
Annex) 

All other companies 

76,6 % 

73,2 % 

67,4 % 

13,7 % 

10,6 % 

51,6 % 

77,6 % 

EN 

28 

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(141)  The  individual  anti-dumping  duty  rates  specified  in  this  Regulation  were  established 
on  the  basis  of  the  findings  of  the  present  investigation.  Therefore,  they  reflect  the 
situation found during that investigation with respect to these companies. These duty 
rates (as opposed to the countrywide duty applicable to ‘all other companies’) are thus 
exclusively applicable to imports of products originating in the PRC and produced by 
these companies and thus by the specific legal entities mentioned. Imported products 
produced by any other company not specifically mentioned in the operative part of this 
Regulation  with  its  name  and  address,  including  entities  related  to  this  specifically 
mentioned, cannot benefit from this rate and shall be subject to the countrywide duty. 

(142)  Any claim requesting the application of an individual company anti-dumping duty rate 
(e.g. following a change in the name of the entity or following the setting up of new 
production or sales entities) should be addressed to the Commission forthwith with all 
relevant information, in particular any modification in the company's activities linked 
to  production,  domestic  and  export  sales  associated  with,  for  example,  that  name 
change  or  that  change  in  the  production  and  sales  entities.  If  appropriate,  the 
Regulation will accordingly be amended by updating the list of companies benefiting 
from individual duties. 

(143)  Measures are imposed to allow the producers in the Community to recover from the 
injurious  effect  of  dumping.  To  the  extent  that  there  would  be  any  initial  imbalance 
between  the  potential  benefit  for  producers  in  the  Community  and  the  cost  for 
consumers and other economic operators in the Community, this imbalance could be 
offset by an increase and/or restart of the production in the Community. However, as 
already indicated above, given the magnitude of the burden of the possible duties and 
considering  that  the  envisaged  scenario  of  increased  production  in  the  Community 
might also not materialise, it is considered prudent, in such exceptional circumstances, 
to limit the duration of measures to a period of 2 years only.  

(144)  This period should be enough for the producers in the Community to increase and/or 
restart  their  production  in  Europe,  while  at  the  same  time  not  significantly  endanger 
the  situation  of  consumers  and  other  economic  operators  in  the  Community..  It  is 
considered that the period of two years will be the most appropriate to analyse whether 
the  imposition  of  measures  had  indeed  the  effect  of  increasing  European  production 
and thereby balancing the negative effects on importers and consumers.  

Implementation 

(145)  It  is  also  considered  appropriate  to  closely  monitor  the  situation  on  the  Community 
market,  following  the  imposition  of  measures,  in  view  of  possibly  reviewing  the 
measures expeditiously should it appear that the duties are not reaching their intended 
effect,  i.e.  allowing  for  ensuring  the  viability  of  existing  producers  in  the  short  term 
and the improvement of their economic and financial situation in the medium term. 

(146)  To this effect, the producers in the Community will be invited by the Commission to 
report to it periodically  on the evolution of a number  of  key  economic  and  financial 
indicators. Also importers and other operators involved may be so invited, or provide 
such  information  of  their  own  initiative.  On  the  basis  of  these  data  the  Commission 
will  make  a  periodic  assessment  of  the  situation  of  imports  and  Community 
production, so as to be in a position to act swiftly should this be necessary.  

(147)  All  parties  were  informed  of  the  essential  facts  and  considerations  on  the  basis  of 
which it was intended to recommend the imposition of definitive anti-dumping duties. 
They  were  also  granted  a  period  within  which  they  could  make  representations 

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subsequent  to  this  disclosure.  The  comments  submitted  by  the  parties  were  duly 
considered, and, where appropriate, the findings have been modified accordingly. All 
parties were given detailed responses to the comments they have submitted. 

(148)  In  order  to  ensure  equal  treatment  between  any  new  exporters  and  the  cooperating 
companies  not  included  in  the  sample,  mentioned  in  the  Annex  to  this  Regulation, 
provision  should  be  made  for  the  weighted  average  duty  imposed  on  the  latter 
companies to be applied to any new exporters which would otherwise be entitled to a 
review pursuant to Article 11(4) of the basic Regulation,  

HAS ADOPTED THIS REGULATION: 

Article 1 

1. 
A  definitive  anti-dumping  duty  is  hereby  imposed  on  imports  of  reciprocating 
compressors  (excluding  reciprocating  compressor  pumps),  giving  a  flow  not  exceeding  2 
cubic metres (m³) per minute, falling within CN codes ex 8414 40 10, ex 8414 80 22, ex 8414 
80 28 and ex 8414 80 51, (TARIC codes 8414 40 10 10, 8414 80 22 19, 8414 80 22 99, 8414 
80 28 11, 8414 80 28 91, 8414 80 51 19 and 8414 80 51 99) and originating in the People’s 
Republic of China. 

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

Company 

Duty  

TARIC additional 
codes 

Zhejiang  Xinlei  Mechanical  &  Electrical  Co.  Ltd., 
Wenling 

77,6 % 

Zhejiang Hongyou Air Compressor Manufacturing Co. 
Ltd., Wenling and Taizhou Hutou Air Compressors 
Manufacturing Co. Ltd., Wenling 

Shanghai Wealth Machinery & Appliance Co. Ltd., 
Shanghai and Wealth (Nantong) Machinery Co., Ltd., 
Nantong 

76,6 % 

73,2 % 

Zhejiang Anlu Cleaning Machinery Co., Ltd., Taizhou 

67,4 % 

Nu  Air  (Shanghai)  Compressor  and  Tools  Co.  Ltd., 
Shanghai 

13,7 % 

FIAC Air Compressors (Jiangmen) Co. Ltd., Jiangmen 

10,6 % 

Co-operating  companies  not  included  in  the  sample 
(listed in Annex) 

51,6 % 

A860 

A861 

A862 

A863 

A864 

A865 

A866 

All other companies 

77,6 % 

A999 

3. 
apply. 

EN 

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

30 

   EN 

 
4.  Where  any  new  exporting  producer  in  the  People's Republic of China provides sufficient 
evidence to the Commission that: 

– 

– 

– 

– 

it did not export to the Community the product described in paragraph 1 in the period 
between 1 October 2005 and 30 September 2006, 

it is not related to any exporter or producer in the People's Republic of China which 
is subject to the anti-dumping measures imposed by this Regulation and, 

it  has  actually  exported  to  the  Community  the  product  concerned  after  the 
investigation  period  on  which  the  measures  are  based,  or  it  has  entered  into  an 
irrevocable contractual obligation to export a significant quantity to the Community, 

it  operates  under  market  economy  conditions  as  defined  in  Article  2(7)(c)  of  the 
basic Regulation or alternatively that it fulfils the requirements to have an individual 
duty in accordance with Article 9(5) of that Regulation,  

the  Council,  acting  by  simple  majority  on  a  proposal  submitted  by  the  Commission  after 
consulting  the  Advisory  Committee,  may  amend  paragraph  2  by  adding  the  new  exporting 
producer  to  the  co-operating  companies  not  included  in  the  sample  and  thus  subject  to  the 
weighted average duty of 51,6 %. 

This  Regulation  shall  enter  into  force  on  the  day  following  that  of  its  publication  in  the 
Official Journal of the European Union. It shall be in force for a period of 2 years. 

Article 2 

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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31 

   EN 

 
 
 
 
 
ANNEX  

CHINESE COOPERATING EXPORTING PRODUCERS NOT SAMPLED 

TARIC Additional Code A866 

Fini (Taishan) Air Compressor Manufacturing Co., Ltd. 

Lacme Dafeng Machinery Co., Ltd. 

Qingdao  D&D  Electro  Mechanical  Technologies  Co.,  Ltd.  and 
Qingdao D&D International Co., Ltd. 

Shanghai Liba Machine Co., Ltd. 

Taizhou Sanhe Machinery Co., Ltd.  

Taizhou Dazhong Air Compressors Co., Ltd. 

Taizhou Shimge Machinery & Electronic Co., Ltd. 

Quanzhou Yida Machine Equipment Co., Ltd. 

Taishan 

Dafeng 

Qingdao 

Shanghai 

Wenling 

Wenling 

Wenling 

Quanzhou 

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   EN