Proposal for a Council Regulation extending the suspension of the definitive anti-dumping duty imposed by Regulation (EC) No 1420/2007 on imports of silico-manganese originating in the People’s Republic of China and Kazakhstan
Date: 2008-07-29
Institutions: European Commission
Subjects: China, Kazakhstan, anti-dumping duty, anti-dumping legislation, ferro-alloy, import, manganese, originating product, semi-metal

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COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 29.7.2008 
COM(2008) 491 final 

Proposal for a 

COUNCIL REGULATION 

extending the suspension of the definitive anti-dumping duty imposed by Regulation 
(EC) No 1420/2007 on imports of silico-manganese originating in the People’s Republic 
of China and Kazakhstan 

(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 

The  measures  on  imports  of  silico-manganese  from  China  (8,2  %)  and  Kazakhstan 
(6,5 %)  were  imposed  on  6  December  2007  by  the  Council  Regulation  (EC)  No 
1420/2007.  

As  a  result  of  a  temporary  price  hike  on  the  market  and  a  clear  improvement  of  the 
Community  industry's  situation  in  short  term,  which  occurred  after  the  original  IP 
(mid-2006 to mid-2007), the measures were simultaneously suspended for a period of 9 

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months  by  a  Commission  Decision  (2007/789/EC)  that  also  entered  into  force  on  6 
December 2007. This Decision will lapse on 6 September 2008. 

Following  the  suspension  of  the  definitive  anti-dumping  duties,  the  Commission  has 
continued to monitor the developments on the market. It was established that prices of 
SiMn  on  the  Community  market  continued  to  be  high  and  that  the  situation  of  the 
Community  industry  remained  improved  and  that  the  latter  is  currently  not  suffering 
injury.  It  is  also  considered  that  the  injury  caused  by  imports  from  the  countries 
concerned is unlikely to resume as a result of the extension of the suspension  

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 

extending the suspension of the definitive anti-dumping duty imposed by Regulation 
(EC) No 1420/2007 on imports of silico-manganese originating in the People’s Republic 
of China and Kazakhstan 

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 14(4) thereof, 

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

Whereas: 

(1) 

(2) 

(3) 

A. PROCEDURE 

The Council, by Regulation (EC) No 1420/20072, imposed a definitive anti-dumping 
duty  on  imports  of  silico-manganese  (including  ferro-silico-manganese)  ('SiMn') 
originating in the People’s Republic of China ('PRC') and Kazakhstan, falling within 
CN codes 7202 30 00 and ex 8111 00 11 (TARIC code 8111 00 11 10) ('the product 
concerned'). The rate of the anti-dumping duty is 8,2 % and 6,5 % for imports of the 
product concerned originating in the PRC and Kazakhstan respectively.  
By  Decision  2007/789/EC3  (the  Decision),  the  Commission  suspended  the  definitive 
anti-dumping duties for a period of nine months, with effect from 6 December 2007. 

B. GROUNDS FOR EXTENDING OF THE SUSPENSION 

Article  14(4)  of  the  basic  Regulation  provides  that,  in  the  Community  interest,  anti-
dumping  measures  may  be  suspended  on  the  grounds  that  market  conditions  have 
temporarily changed to an extent that injury would be unlikely to resume as a result of 
such suspension, provided that the Community industry has been given an opportunity 
to  comment  and  these  comments  have  been  taken  into  account.  Article  14(4)  also 
specifies that the suspension may be extended for a further period, not exceeding one 
year,  if  the  Council  so  decides,  acting  on  a  proposal  from  the  Commission.  Article 
14(4) further specifies that the measures concerned may be reinstated at any time if the 
reason for suspension is no longer applicable. 

(4) 

Following the suspension of the definitive anti-dumping duties, the Commission has, 
in accordance with recital (13) of the Decision, continued to monitor the developments 
on the market, in particular with regard to the flow of imports and the prices of SiMn. 

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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 317, 5.12.2007, p. 5. 
OJ L 317, 5.12.2007, p. 79. 

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(5) 

(6) 

In  addition  to  such  analysis  of  the  imports,  a  questionnaire  was  also  sent  to  co-
operating  Community  producers  requesting  monthly  data  on  production,  sales  in 
volume and value on the Community market as well as profitability for the last quarter 
of 2007 and the first quarter of 2008.  

On the basis of the information gathered, it was established that market prices of SiMn 
on the Community market continued to be relatively high and significantly higher than 
during the original investigation period (1 July 2005 to 30 June 2006). A continuous 
increase can be observed from the third quarter of year 2006 with an average price of 
622 euro/MT, through an average 1051 euro/MT in the third quarter of year 2007 and 
an  average  1189  euro/MT  in  the  first  quarter  of  year  2008.  These  trends  were  also 
observed for imports of SiMn into the Community.  

As  regards  imports,  between  the  period  investigated  for  the  Decision  suspending  the 
measures  (from  1  October  2006  to  30 September  2007)  (the  "Decision  IP")  and  the 
period from 1 March 2007 to 29 February 2008 ("the Monitoring Period") the market 
share  of  imports  of  SiMn  originating  in  the  PRC  and  Kazakhstan  increased  only 
marginally  by  0,2  percentage  point  to  10  %  of  the  overall  Community  consumption 
and  remained  below  their  respective  market  share  during  the  original  investigation 
period (10,4 %). EC consumption remained stable, around 20 % higher then during the 
original investigation period. 

(7)  With  regard  to  the  Community  industry,  its  situation  remained  improved  when 
compared to the original investigation period (from 1 July 2005 to 30 June 2006). As 
mentioned in recital (8) of the Decision, between the original investigation period and 
the  period  from  1  October  2006  to  30  September  2007,  the  sales  and  production 
volumes  have  increased  by  15  %  and  19  %  respectively  and  the  profitability  of  the 
Community  industry  reached  42  %  in  the  third  quarter  of  year  2007.  The  new 
information  gathered  revealed  that  between  the  Decision  IP  and  the  Monitoring 
Period, the sales of the Community industry increased even further by additional 9 % 
and their market share increased to 25,4 %. As a result of the uninterrupted high price 
levels  of  the  SiMn  on  the  EU  market  the  profitability  of  the  Community  industry 
remained extraordinary, even if it slightly dropped in the first quarter of year 2008 to 
36 %, still substantially surpassing the 5 % profit level established as appropriate by 
the original investigation. 

(8) 

As indicated in recitals (157) to (163) of Regulation (EC) No 1420/2007 and referred 
to in recital (9) of the Decision, the imposition of measures in question was expected 
to have some negative, although limited, effects for users in the form of cost increases 
arising out of the possible need to arrange new or alternative supplies. Considering the 
temporary change in market conditions and that consequently the Community industry 
is  currently  not  suffering  injury,  any  negative  effect  on  users  could  continue  to  be 
eliminated  by  extending  the  suspension  of  the  measures.  Consequently,  it  can  be 
concluded that extending the suspension is in the overall Community interest. 

C. CONSULTATION OF COMMUNITY INDUSTRY 

(9) 

Pursuant  to  Article  14(4)  of  the  basic  Regulation,  the  Commission  has  informed  the 
Community  industry  of  its  intention  to  extend  the  suspension  of  the  anti-dumping 
measures  in  question.  The  Community  industry  has  been  given  an  opportunity  to 
comment and did not oppose the suspension of the anti-dumping measures. 

D. CONCLUSION 

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(10)  Given the above, it is considered that the market is in a substantially similar situation 
as when the measures where suspended. Indeed, considering the temporary change in 
market  conditions,  and  in  particular  the  high  level  of  prices  of  SiMn  existing  on  the 
Community  market,  which  is  far  higher  than  the  injurious  price  level  found  in  the 
original  investigation,  it  is  considered  that  the  injury  linked  to  the  imports  of  the 
product concerned originating in the PRC and Kazakhstan is unlikely to resume as a 
result of the extension of the suspension. 

(11) 

In view of the aforementioned findings, it is therefore proposed that the suspension of 
the  anti-dumping  measures  on  imports  of  silico-manganese  (including  ferro-silico-
manganese) be extended for a further period of one year pursuant to Article 14(4) of 
the basic Regulation. 

(12)  The Commission will continue to monitor the development of imports and the prices 
of  the  product  concerned.  Should  a  situation  arise  at  any  time  in  which  increased 
volumes  at  dumped  prices  of  the  product  concerned  from  the  PRC  and  Kazakhstan 
resume  and  consequently  cause  injury  to  the  Community  industry,  the  Commission 
will take the necessary steps to reinstate the anti-dumping duty, taking into account the 
substantive  rules  that  govern  an  injury  assessment.  An  interim  review  pursuant  to 
Article 11(3) of the basic Regulation may be initiated, if appropriate,  

HAS ADOPTED THIS REGULATION:  

The  suspension  of  the  definitive  anti-dumping  duty  imposed  by  Commission  Decision 
2007/789/EC is hereby extended until 6 September 2009. 

Article 1 

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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