Proposal for a Council Regulation amending Council Regulation (EC) No 1911/2006 of 19 December 2006 imposing a definitive anti-dumping duty on imports of solutions of urea and ammonium nitrate originating in Algeria, Belarus, Russia and Ukraine following an expiry review pursuant to Article 11(2) of Regulation (EC) No 384/96
Date: 2008-07-02
Institutions: European Commission
Subjects: Algeria, Belarus, Russia, Ukraine, anti-dumping duty, anti-dumping legislation, import, organic fertiliser, originating product

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COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 2.7.2008 
COM(2008) 411 final 

Proposal for a 

COUNCIL REGULATION 

amending Council Regulation (EC) No 1911/2006 of 19 December 2006 imposing a 
definitive anti-dumping duty on imports of solutions of urea and ammonium nitrate 
originating in Algeria, Belarus, Russia and Ukraine following an expiry review pursuant 
to Article 11(2) of Regulation (EC) No 384/96  

(presented by the Commission) 

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1) 

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EXPLANATORY MEMORANDUM 

Context of the proposal 

•  Grounds for and objectives of the proposal 
This  proposal  concerns  the  application  of  Council  Regulation  (EC)  No  384/961  on 
protection  against  dumped  imports  from  countries  not  members  of  the  European 
Community (‘the basic Regulation’) in the proceeding concerning imports of solutions 
of urea and ammonium nitrate originating in Russia.  

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•  General context 

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

•  Existing provisions in the area of the proposal 
Council Regulation (EC) No 1995/20002, imposing a definitive anti-dumping duty on 
imports  of  solutions  of  urea  and  ammonium  nitrate  originating  in  Russia  into  the 
Community. 

•  Consistency with other policies and objectives of the Union 

Not applicable. 

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2) 

Consultation of interested parties and impact assessment 

•  Consultation of interested parties 

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The applicant and the Community industry have been informed of the findings of the 
examination and have had the opportunity to submit their comments. 

•  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  make  provision  for  a  general  impact  assessment  but 
contains an exhaustive list of conditions that have to be assessed. 

3) 

Legal elements of the proposal 

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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 L 238, 22.9.2000, p. 15. Regulation as last amended by Regulation (EC) No 1675/2003 (OJ L 238, 
25.9.2003, p. 4). 

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305 

•  Summary of the proposed action 
By  Regulation  (EC)  No  1995/20003,  the  Council  imposed  a  definitive  anti-dumping 
duty on imports of solutions of urea and ammonium nitrate originating in Russia.  

Further to a request lodged by two exporting producers from Russia, an interim review 
limited to dumping was initiated.  

The investigation showed that dumping took place during the investigation period. The 
level of the dumping found was higher than the injury elimination level which forms 
the basis of the current measures in force. Therefore, the measures were maintained at 
their  level.  The  regulation  terminating  the  review  included  a  clause  enabling  the 
interested parties to submit an undertaking offer within 10 calendar days from the entry 
into force of this regulation. 

Such undertaking offer was submitted in due time. It stipulates that a certain quantity, 
representing  around  10%  of  the  total  Community  consumption  of  the  product 
concerned, can be exported to the EC without paying the applicable anti-dumping duty 
if a certain indexed minimum import price is respected. 

This undertaking offer was accepted. It is therefore proposed that the Council adopt the 
attached proposal for a Regulation, which should be published in the Official Journal 
of the European Union. 

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•  Legal basis 

Council  Regulation  (EC)  No  384/1996  of  22  December  1995  on  protection  against 
dumped imports from countries not members of the European Community ("the basic 
Regulation")4. 

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•  Subsidiarity principle 

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

•  Proportionality principle 

The proposal complies with the proportionality principle for the following reason(s). 

Council Regulation (EC) No 1995/2000 imposing the definitive anti-dumping duty on 
imports of solutions of UAN originating in Russia last amended by Council Regulation 
(EC) No 1675/2003 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. 

OJ L 238, 22.9.2000, p. 15. Regulation as last amended by Regulation (EC) No 1675/2003 (OJ L 238, 
25.9.2003, p. 4). 
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). 

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•  Choice of instruments 

Proposed instruments: regulation. 

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

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

Budgetary implication 

The proposal has no implication for the Community budget. 

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Proposal for a 

COUNCIL REGULATION 

amending Council Regulation (EC) No 1911/2006 of 19 December 2006 imposing a 
definitive anti-dumping duty on imports of solutions of urea and ammonium nitrate 
originating in Algeria, Belarus, Russia and Ukraine following an expiry review pursuant 
to Article 11(2) of Regulation (EC) No 384/96  

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 Community5 ('the basic 
Regulation'), and in particular Articles 8 and 9 thereof, 

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

Whereas: 

(1) 

(2) 

A. PROCEDURE 

By  Regulation  (EC)  No  1995/20006,  the  Council  imposed  a  definitive  anti-dumping 
duty on imports of solutions of urea and ammonium nitrate (UAN) originating, inter 
alia, in Russia. Following an expiry review initiated in September 2005, the Council, 
by  Regulation  (EC)  No  1911/20067,  renewed  for  five  years  these  measures  at  their 
current level.  

On  19  December  2006,  the  Commission  announced  by  a  notice  published  in  the 
Official  Journal  of  the  European  Union8,  the  initiation  of  a  partial  interim  review 
concerning imports into the Community of UAN originating, inter alia, in Russia upon 
the  request  of  Open  Joint  Stock  Company  Novomoskovskiy  Azot  and  Open  Joint 
Stock  Company  Nevinnomyssky  Azot,  two  exporting  producers  from  Russia, 
belonging  to  the  Open  Joint  Stock  Company  "Mineral  and  Chemical  Company 
Eurochem".  These  two  companies,  due  to  their  relationship,  are  treated  as  one  legal 
entity  ("the  exporting  producer")  for  the  purpose  of  the  present  Regulation.  The 
definitive findings and conclusions of the partial interim review are set out in Council 
Regulation (EC) No 238/2008 of 10 March 20089 by which the review was terminated 
without amending the anti-dumping measures in force. 

B. UNDERTAKING 

(3) 

During  the  interim  review  the  exporting  producer  expressed  an  interest  in  offering  a 
price undertaking but failed to submit a duly substantiated offer within the deadline as 

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OJ  L  56,  6.3.1996,  p.1.  Regulation  as  last  amended  by  Regulation  (EC)  No  2117/2005  (OJ  L  340, 
23.12.2005, p.17) 
OJ L 238, 22.9.2000, p. 15. 
OJ L 365, 21.12.2006, p. 26. 
OJ C 311, 19.12.2006, p. 51. 
OJ L 75, 18.03.2008. p. 14 

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(4) 

(5) 

set out in Article 8(2) of the basic Regulation. However as stated in Recitals (57) and 
(58)  of  the  above  mentioned  Council  Regulation,  the  Council  considered  that  the 
exporting producer should exceptionally be allowed to complete its undertaking offer 
within 10 calendar days from entry into force of that Regulation due to the complexity 
of several issues, namely (1) the volatility of the price of the product concerned which 
would require some form of indexation of minimum prices, while at the same time the 
volatility  is  not  sufficiently  explained  by  the  key  cost  driver;  and  (2)  the  particular 
market situation for the product concerned. Subsequent to the publication of Council 
Regulation (EC) No 238/2008 and within the deadline as set out in that Regulation the 
exporting producer submitted an acceptable price undertaking with Article 8(1) of the 
basic Regulation.  
The  Commission  by  Decision  [INSERT]10  accepted  the  undertaking  offer.  The 
Council  recognises  that  the  undertaking  offer  eliminates  the  injurious  effect  of 
dumping and limits to a sufficient degree the risk of circumvention. 

To further enable the Commission and the customs authorities to effectively monitor 
the compliance of the exporting producer with the undertaking, when the request for 
release  for  free  circulation  is  presented  to  the  relevant  customs  authority,  exemption 
from  the  anti-dumping  duty  is  to  be  conditional  on  (i)  the  presentation  of  an 
undertaking  invoice,  which  is  a  commercial  invoice  containing  at  least  the  elements 
listed and the declaration stipulated in the Annex; (ii) the fact that imported goods are 
manufactured,  shipped  and  invoiced  directly  by  the  exporting  producer  to  the  first 
independent customer in the Community; and (iii) the fact that the goods declared and 
presented  to  customs  correspond  precisely  to  the  description  on  the  undertaking 
invoice.  Where  the  above  conditions  are  not  met  the  appropriate  anti-dumping  duty 
shall  be  incurred  at  the  time  of  acceptance  of  the  declaration  for  release  into  free 
circulation. 

(6)  Whenever  the  Commission  withdraws,  pursuant  to  Article  8(9)  of  the  basic 
Regulation,  its  acceptance  of  an  undertaking  following  a  breach  by  referring  to 
particular  transactions  and  declares  the  relevant  undertaking  invoices  as  invalid,  a 
customs debt shall be incurred at the time of acceptance of the declaration for release 
into free circulation of these transactions. 

(7) 

(8) 

(9) 

Importers should be aware that a customs debt may be incurred, as a normal trade risk, 
at  the  time  of  acceptance  of  the  declaration  for  release  into  free  circulation  as 
described  in  recitals  (5)  and  (6)  even  if  an  undertaking  offered  by  the  manufacturer 
from  whom  they  were  buying,  directly  or  indirectly,  had  been  accepted  by  the 
Commission. 

Pursuant  to  Article  14(7)  of  the  basic  Regulation,  customs  authorities  should  inform 
the  Commission  immediately  whenever  indications  of  a  violation  of  the  undertaking 
are found. 

For  the  reasons  stated  in  the  Commission  Decision,  the  undertaking  offered  by  the 
exporting  producer  is  therefore  considered  acceptable  by  the  Commission  and  the 
exporting producer concerned has been informed of the essential facts, considerations 
and obligations upon which acceptance is based. 

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INSERT REFERENCE 

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(10) 

In the event of a breach or withdrawal of the undertaking or in case of withdrawal of 
acceptance  of  the  undertaking  by  the  Commission  the  anti-dumping  duty  which  has 
been imposed by the Council in accordance with Article 9(4) shall automatically apply 
by means of Article 8(9) of the basic Regulation. 

HAS ADOPTED THIS REGULATION: 

Regulation (EC) No 1911/2006 is hereby amended as follows: 

Paragraph 4 in Article 1 shall be replaced by the following paragraph : 

Article 1 

Notwithstanding  paragraph  1,  the  definitive  anti-dumping  duty  shall  not  apply  to 

"4. 
imports released into free circulation in accordance with Article 2 or Article 2a." 

The following Article shall be added after Article 2: 

"Article 2a 

1. 

Imports  of  mixtures  of  urea  and  ammonium  nitrate  for  release  into  free  circulation 
which  are  invoiced  by  the  company  from  which  an  undertaking  is  accepted  by  the 
Commission  and  whose  name 
the  Commission  Decision 
[2008/[INSERT]/EC], as from time to time amended, shall be exempt from the anti-
dumping duty imposed by Article 1, on condition that: 

listed 

in 

is 

– 

– 

– 

they  are  manufactured,  shipped  and  invoiced  directly  by  the  said  producer  to 
the first independent customer in the Community; and 

such  imports  are  accompanied  by  an  undertaking  invoice  which  is  a 
commercial  invoice  containing  at  least  the  elements  and  the  declaration 
stipulated in Annex of this Regulation; and 

the  goods  declared  and  presented  to  customs  correspond  precisely  to  the 
description on the undertaking invoice. 

2. 

A  customs  debt  shall  be  incurred  at  the  time  of  acceptance  of  the  declaration  for 
release into free circulation: 

– 

– 

whenever it is established, in respect of imports described in paragraph 1, that 
one or more of the conditions listed in that paragraph are not fulfilled; or 

when the Commission withdraws its acceptance of the undertaking pursuant to 
Article 8(9) of the basic Regulation in a Regulation or Decision which refers to 
particular  transactions  and  declares  the  relevant  undertaking  invoices  as 
invalid." 

The Annex shall be replaced by the following Annex: 

"ANNEX 

Elements to be indicated in the undertaking invoice referred to in Article 2(2) and Article 2a: 

1. The TARIC additional code under which the goods on the invoice may be customs cleared 
at Community borders (as specified in the appropriate Regulation or Decision). 

2. The exact description of the goods, including: 

— CN code, 

— The nitrogen (‘N’) content of the product (in percentages), 

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— quantity (to be given in tonnes). 

3. The description of the terms of the sale, including: 

— price per tonne, 

— the applicable payment terms, 

— the applicable delivery terms, 

— total discounts and rebates. 

4. The name of the unrelated importer to which the invoice is issued directly by the company. 

5.  The  name  of  the  official  of  the  company  that  has  issued  the  undertaking  invoice  and  the 
following signed declaration: 

‘I, the undersigned, certify that the sale for direct export to the European Community of the 
goods  covered  by  this  invoice  is  being  made  within  the  scope  and  under  the  terms  of  the 
undertaking  offered  by  [company],  and  accepted  by  the  European  Commission  through 
Regulation (EC) No 617/2000 or Decision 2008/xxxx/EC (as appropriate). I declare that the 
information provided in this invoice is complete and correct." 

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

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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