Proposal for a Council Regulation imposing a definitive anti-dumping duty on imports of certain welded tubes and pipes of iron or non-alloy steel
Date: 2008-11-18
Institutions: European Commission
Subjects: Belarus, Bosnia and Herzegovina, China, Thailand, Türkiye, Ukraine, anti-dumping duty, originating product, piping, tube

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COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 18.11.2008 
COM(2008) 759 final 

Proposal for a 

COUNCIL REGULATION 

imposing a definitive anti-dumping duty on imports of certain welded tubes and pipes of 
iron or non-alloy steel  

(presented by the Commission) 

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Proposal for a 

COUNCIL REGULATION 

imposing a definitive anti-dumping duty on imports of certain welded tubes and pipes of 
iron or non-alloy steel  

-  originating  in  Belarus,  the  People's  Republic  of  China  and  Russia  following  a 
proceeding pursuant to Article 5 of Regulation (EC) No 384/96, 

-  originating  in  Thailand  following  an  expiry  review  pursuant  to  Article  11(2)  of  the 
same Regulation, 

-  originating  in  the  Ukraine  following  an  expiry  review  pursuant  to  Article  11(2)  and 
interim review pursuant to Article 11(3) of the same Regulation,  

- and terminating the proceedings in respect of imports of the same product originating 
in Bosnia and Herzegovina and in Turkey.

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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  384/96  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') to imports of certain welded tubes and pipes of iron 

or non-alloy steel originating in Belarus, Bosnia and Herzegovina, the People's Republic of 

China ('PRC'), Russia, Thailand, Turkey and Ukraine 

  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  1697/2002  of  23  September  2002  imposing  definitive  anti-

dumping  duties  on  imports  of  certain  welded  tubes  and  pipes  of  iron  or  non-alloy  steel 

originating in Thailand, Turkey and Ukraine. 

  Consistency with the other policies and objectives of the Union 

Not applicable. 

CONSULTATION OF INTERESTED PARTIES AND IMPACT ASSESSMENT 

Consultation of interested parties 

Interested parties concerned by the proceedings have 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 

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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. 

LEGAL ELEMENTS OF THE PROPOSAL 

Summary of the proposed action 

a)  Anti-dumping investigation pursuant to Article 5 of the basic Regulation 

concerning  imports  of  certain  welded  tubes  and  pipes  of  iron  or  non-

alloy  steel  originating  in  the  PRC,  Russian  Federation,  Bosnia 

Herzegovina, and Belarus 

In 2007,  the  Defence  Committee of  the Welded Steel Tube Industry of the European 

Union,  lodged  a  complaint  in  accordance  with  Article  5  of  the  basic  Regulation,  on 

behalf of producers representing a major proportion, in this case more than 50 %, of the 

total Community production of the product concerned. 

Having determined that sufficient evidence existed for the initiation of an anti-dumping 
investigation,  the  Commission  initiated  the  case  on  26.09.20071.  The  investigation 
found  dumping  of  the  product  concerned,  which  caused  injury  to  the  Community 

industry  by  imports  from  the  countries  concerned,  with  the  exception  of  Bosnia  and 

Herzegovina. The investigation also showed that there was no compelling Community 

interest aspect against the imposition of definitive anti-dumping measures. 

It is thus proposed that definitive anti-dumping duties be imposed on imports of certain 

welded  tubes  and  pipes  of  iron  or  non-alloy  steel  originating  in  Belarus,  the  People's 

Republic of China and Russia and that the proceeding in respect of imports of the same 

product originating in Bosnia and Herzegovina be terminated. 

b) 

Expiry  reviews  of  the  anti-dumping  measures  in  force  on  imports  of 
certain welded tubes and pipes of iron or non-alloy steel originating in 
Turkey,  Thailand  and  Ukraine,  and  interim  review  concerning  imports 
originating in Turkey 

The request was lodged by the Defence Committee of the Welded Steel Tube Industry 
of the European Union, on behalf of producers representing a major proportion, in this 
case more than 50 % of the total Community production of the product concerned.  

1 

OJ C 226, 26.9.2007, p. 7, as amended by OJ 294, 6.12.2007, p. 21. 

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Having determined that sufficient evidence existed for the initiation of the reviews, the 
Commission initiated the case on 26.09.20072. 

The  investigation  confirmed  the  likelihood  of  continuation  or  recurrence  of  dumping 

and injury and it is hereby proposed to maintain the anti-dumping measures on imports 

of certain welded tubes and pipes of iron or non-alloy steel originating in Thailand and 

Ukraine, with the exception of Turkey. 

Regarding the interim review in respect of Turkey, Defence Committee of the Welded 

Steel Tube Industry of the European Union provided information that, with regard to 

imports of the product concerned from Turkey, the level of the measure was no longer 

sufficient  to  counteract  the  injurious  dumping,  which  appeared  to  have  significantly 

increased. 

For Turkey, the interim review concluded that the duties set by the previous regulation 

should be lifted. 

c) Interim review of the anti-dumping measures in force on imports of certain 

welded tubes and pipes of iron or non-alloy steel limited to dumping for 

a Ukrainian company, Interpipe Group 

The  request  was  lodged  by  the  Ukrainian  company,  Interpipe  Group,  which  alleged 

that  a  comparison  of  normal  value  based  on  its  own  costs/domestic  prices  and  its 

export prices to a third country market comparable to the EU, would lead to a reduction 

of  dumping  significantly  below  the  level  of  the  current  measures.  Therefore,  the 

continued imposition of the measure at its current level is no longer necessary to offset 

dumping. 

Having determined that sufficient evidence existed for the initiation of the review, the 
Commission initiated the case on 24.01.2008.3 

The investigation concluded that the rates of duty set in the previous regulation should 
be adjusted. 

Member  States  were  consulted  during  the  Anti-Dumping  Committee  of  ….  2008.  X 

Member  States  were  in  favour  of  the  proposed  course  of  action,  X  opposed,  X 

abstained and X did not react. 

It  is  proposed  that  the  Council  adopt  the  attached  proposal  for  a  Regulation  which 

2 
3 

OJ C 226, 26.9.2007, p. 12. 
OJ C 17, 24.1.2008, p. 14. 

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should be published in the Official Journal of the European Union on XX at the latest. 

Legal basis 

Council  Regulation  (EC)  No  384/96  of  22  December  1995  on  protection  against 

dumped  imports  from  countries  not  members  of  the  European  Community,  as  last 

amended by Council Regulation (EC) No 2117/2005 of 21 December 2005.  

Subsidiarity principle 

The proposal falls under the exclusive competence of the Community. The subsidiarity 

principle therefore does not apply. 

Proportionality principle 

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

The form of action is described in the basic Regulation and leaves no scope for national 

decision. 

An indication of how financial and administrative burden falling upon the Community, 

national governments, regional and local authorities, economic operators and citizens is 

minimized and proportionate to the objective of the proposal is not applicable. 

Choice of instruments 

Proposed instruments: regulation. 

Other means would not be adequate for the following reason: 

The 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 

imposing a definitive anti-dumping duty on imports of certain welded tubes and pipes of 
iron or non-alloy steel  

-  originating  in  Belarus,  the  People's  Republic  of  China  and  Russia  following  a 
proceeding pursuant to Article 5 of Regulation (EC) No 384/96, 

-  originating  in  Thailand  following  an  expiry  review  pursuant  to  Article  11(2)  of  the 
same Regulation, 

-  originating  in  Ukraine  following  an  expiry  review  pursuant  to  Article  11(2)  and  an 
interim review pursuant to Article 11(3) of the same Regulation,  

- and terminating the proceedings in respect of imports of the same product originating 
in Bosnia and Herzegovina and Turkey. 

THE COUNCIL OF THE EUROPEAN UNION, 

Having regard to the Treaty establishing the European Community, 

Having regard to the Council Regulation (EC) No 384/96 of 22 December 1995 on protection 
against dumped imports from countries not members of the European Community4 ('the basic 
Regulation'), and in particular Articles 9, 11(2) and 11(3) thereof, 

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

Whereas: 

1. 

(1) 

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A. PROCEDURE 

Measures in force 

The  Council,  by  Regulation  (EC)  No  1697/2002  imposed  definitive  anti-dumping 
duties  on  imports  of  certain  welded  tubes  and  pipes,  of  iron  or  non-alloy  steel 
originating inter alia in Thailand, Turkey and Ukraine (the 'measures in force').5 

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  259,  27.9.2002,  p.  8,  on  1  May  2004  the  European  Union  enlarged  to  include  10  new  Member 
States, inter alia the Czech Republic and Poland. As from that date, the antidumping measures in force 
in  the  Community  of  15  Member  States  were  automatically  extended  to  be  applied  also  by  the  new 
Member States to imports from third countries. Measures against the new Member States automatically 
lapsed on the same date. 

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2. 

Present investigation 

2.1. 

Complaint 

(2) 

(3) 

A complaint was lodged on 20 August 2007 by the Defence Committee of the Welded 
Steel  Tube  Industry  of  the  European  Union  (the  Defence  Committee),  the 
complainant, on behalf of producers representing a major proportion, in this case more 
than  50%,  of  the  total  Community  production  of  certain  welded  tubes  and  pipes,  of 
iron or non-alloy steel. 

The  complaint  contained  sufficient  evidence  of  dumping  of  the  said  product, 
originating  in  Belarus,  Bosnia  and  Herzegovina,  the  People's  Republic  of  China 
('PRC') and Russia, and of material injury resulting therefrom to justify, after having 
consulted the Advisory Committee, the initiation of a proceeding. 

2.2. 

Requests for review 

(4) 

(5) 

(6) 

On 25 June 2007, a request for reviews pursuant to Article 11(2) and 11(3) of the basic 
Regulation was lodged by the Defence Committee of the Welded Steel Tube Industry 
of the European Union, the complainant, on behalf of producers representing a major 
proportion, in this case more than 50%, of the total Community production of certain 
welded tubes and pipes, of iron or non-alloy steel. 

The request contained sufficient evidence for the initiation of an expiry review of the 
anti-dumping  measures  applicable  to  imports  of  the  said  product  from  Thailand, 
Turkey  and  Ukraine;  and  an  interim  review,  covering  dumping  and  injury,  as  far  as 
imports from Turkey are concerned. After having consulted the Advisory Committee, 
the Commission initiated reviews in accordance with Article 11(2) and (3) of the basic 
Regulation. 

Regarding  Turkey,  the  request  contained  sufficient  evidence  that  imports  of  the 
product concerned remained at significantly high levels both in absolute terms and in 
terms  of  market  share.  It  further  stated  that  the  volumes  and  prices  of  the  imported 
product  concerned  from  this  country  had,  among  other  consequences,  a  negative 
impact on the market share held and on the level of prices charged by the Community 
industry,  resulting  in  substantial  adverse  effects  on  the  overall  performance  and  the 
financial situation of the Community industry. 

(7) 

A request for a partial interim review pursuant to Article 11(3) of the basic Regulation 
was  lodged  on  15  October  2007  by  Interpipe  Group,  an  exporter  from  Ukraine.  The 
request was limited in scope to the examination of dumping.  

2.3. 

Initiation 

(8) 

On 26 September 2007, the Commission announced by a notice ('notice 1') published 
in  the  Official  Journal  of  the  European  Union6,  the  initiation  of  an  anti-dumping 
proceeding  pursuant  to  Article  5  of  the  basic  Regulation  with  regard  to  imports  of 
certain  welded  tubes  and  pipes,  of  iron  or  non-alloy  steel  originating  in  Belarus, 

6 

OJ C 226, 26.9.2007, p. 7, as amended by OJ C 294, 6.12.2007, p. 21. 

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Bosnia  and  Herzegovina,  the  People's  Republic  of  China  and  Russia  (the  'anti-
dumping investigation'). 

(9) 

On  the  same  day,  pursuant  to  Article  11(2)  and  (3)  of  the  basic  Regulation,  the 
Commission announced by a notice ('notice 2') published in the Official Journal of the 
European Union7, the initiation of an expiry review for imports from Thailand, Turkey 
and Ukraine (the 'expiry review') and an interim review as far as imports from Turkey 
are concerned with regard to imports of certain welded tubes and pipes, of iron or non-
alloy steel (the 'Turkey interim review'). 

(10)  On 24 January 2008, pursuant Article 11(3) of the basic Regulation, the Commission 
published in the Official Journal of the European Union8 a notice of initiation ('notice 
3') of an interim review limited to the dumping of one exporter of certain welded tubes 
and pipes, of iron  or  non-alloy steel originating in Ukraine, the Interpipe Group (the 
'Ukraine interim review'). 

(11)  The above-mentioned investigations have been treated jointly since they are obviously 
interlinked  with  each  other,  in  particular  as  regards  the  determination  of  injury  and 
likelihood of recurrence of injury. For the sake of good administration, they have been 
combined in a single Regulation. 

3. 

Parties concerned by this proceeding 

(12)  The  Commission  services  officially  advised  the  complainant,  the  Community 
producers  mentioned  in  the  complaint  and  the  request,  any  other  known  Community 
producers,  importers,  traders,  the  known  exporting  producers  in  Belarus,  Bosnia  and 
Herzegovina, the People's Republic of China, Russia, Thailand, Turkey and Ukraine, 
and the authorities of the countries concerned. 

(13) 

Interested parties were given an opportunity to make their views known in writing and 
to request a hearing within the time limits set in the notices of initiation. A number of 
exporting producers and Community producers represented by the complainant made 
use of this opportunity and submitted claims to be considered during the investigation. 

3.1. 

Sampling 

(14) 

(15) 

In  view  of  the  large  number  of  exporting  producers  for  certain  exporting  countries, 
Community producers and importers involved in the investigations, the application of 
sampling techniques was envisaged wherever relevant in the anti-dumping proceeding, 
the  expiry  review  and  the  Turkey  interim  review,  as  set  out  in  recitals  (8)  and  (9) 
above, 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, exporting producers and representatives acting on their 
behalf,  Community  producers  and  importers  were  requested  to  make  themselves 
known and to provide information as specified in the notices of initiation. 

3.1.1.  Sampling of the Community producers 

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OJ C 226, 26.9.2007, p. 12. 
OJ C 17, 24.1.2008, p. 14. 

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(16)  Fifteen  parties,  13  complainants  and  2  supporting  producers,  replied  to  the  sampling 
form, a further 2 companies cooperated by completing a mini-questionnaire. The level 
of cooperation reached around 95% of Community production. 

(17) 

In accordance with Article 17 of the basic Regulation, the sample was selected, after 
consultation with the complainant, based on the largest representative volume of sales. 
As  a  result  of  this  exercise,  a  sample  of  9  companies  was  selected.  The  sampled 
companies accounted for 67% of the total Community production during the IP. 

3.1.2.  Sampling of the importers 

(18)  Around  140  importers  were  contacted  based  on  the  information  available  to  the 
Commission. Out of those 140, 16 declared that they were not importing welded tubes 
from the countries concerned and 3 companies replied that they were no longer active 
on  the  market  of  the  product  concerned.  Thirteen  unrelated  importers  replied  to  the 
questionnaire, but only two submitted a complete response. The cooperating unrelated 
importers  represented  less  than  5%  of  total  imports  concerned  -  a  very  low  level  of 
cooperation. 

3.1.3.  Sampling of the exporters 

(19)  As  mentioned  in  the  notices  of  initiation,  sampling  was  envisaged  for  the 
exporters/producers  in  the  PRC,  Russia,  Turkey,  Ukraine,  and  Thailand.  Detailed 
information on the sampling exercise per country concerned is set out in the analysis 
for each country below. 

4. 

Verification of information received 

(20)  The Commission sought and verified all the information it deemed necessary for the 
purpose  of  the  determination  of  dumping,  resulting  injury  and  Community  interest. 
Information submitted by the following companies was verified on-spot: 

a) Community industry producers 

– 

– 

– 

– 

– 

– 

Jäkl Karvina, Czech Republik (member of the ArcelorMittal Group) 

ArcelorMittal Poland S.A.,Poland (member of the ArcelorMittal Group) 

Corus Tubes UK, United Kingdom 

Corus Tubes B.V., the Netherlands 

Laminaciones Arregui S.L., Spain 

Ruukki Sverige AB, Sweden  

For the remaining 3 sampled companies: 

–  Mittal steel Iasi, Romania 

– 

Arvedi Tubi Acciaio spa, Italy 

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– 

Zelezarny  Veseli  a.s.,  Czech  Republik  (in  this  case  the  verification  method 
entailed  a  detailed  analysis  and  cross-check  of  the  reply  on  the  basis  of 
supporting documentation provided). 

b) Unrelated importers 

– 

– 

Comercial de Tubos, Spain 

Anastel Ltd, United Kingdom 

c) Exporting producers and producers in the People's Republic of China 

–  Jinghua Steel Pipe Group: 

– 

– 

– 

– 

– 

– 

Hengshui Jinghua Steel Pipe Co. Ltd. 

Tangshan Jinghua Steel Pipe Co. Ltd. 

Laiwu Jinghua Steel Pipe Co. Ltd. 

Jilin Jinghua Steel Pipe Co. Ltd. 

Guangzhou Jinghua Steel Pipe Co. Ltd. 

Chengdu Pengzhou Jinghua Steel Pipe Co Ltd. 

–  Zhejian Kingland Group: 

– 

– 

Zhejian Kingland Pipeline and Technologies Co. Ltd. 

Kingland Group Co. Ltd. 

–  Fubo Group: 

– 

– 

Shandong Fubo Group Co. Ltd. 

Zibo Fubo Steel Pipes Factory Co. Ltd. 

–  Weifang East Steel Pipe Co. Ltd, 

–  Huludao Group: 

– 

– 

Huludao City Steel Pipe Industrial Co. Ltd. 

Huludao Seven-Star Steel Pipe Group Co. Ltd. 

–  Jiangsu Guoqiang Zinc-plating Industrial Co. Ltd. 

d) Exporting producers in Russia 

– 

TMK Group (Joint Stock Company Taganrog Metallurgical Works ('Tagmet'), 
Taganrog) 

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– 

OMK Group (Open Joint Stock Company Vyksa Steel Works ('VMZ'), Vyksa) 

In each of the two groups only the producer with the largest volume of Community exports 
was verified. 

Related traders in Russia 

– 

– 

CJSC Trade House TMK, Moscow, TMK Group 

Closed  Joint  Stock  Company  United  Metallurgical  Company  ('UMC'), 
Moscow, OMK Group 

– 

OMK Steel, LLC, Moscow, OMK Group 

Related importer 

– 

TMK Sinara Handel GmbH, Köln, Germany, TMK Group 

In order to avoid any circumvention in the future, dumping margins have been calculated on a 
group-wide basis. 

e) Exporting producer in Thailand 

– 

Samchai Steel Industries Public Company Ltd., Samutsakorn, Thailand 

f) Exporting producers in Ukraine 

– 

– 

OJSC Interpipe Novomoskovsk Pipe Production Plant  

OJSC Interpipe Nizhnedneprovsk Tube Rolling Plant.  

Related traders/importers located in Ukraine: 

– 

Interpipe Ukraine LLC 

Related traders/importers located outside Ukraine: 

– 

– 

Interpipe -M LLC. 

Interpipe Europe, S.A 

In order to avoid any circumvention in the future, dumping margins have been calculated on a 
group-wide basis. 

g) Exporting producer in Bosnia and Herzegovina 

– 

Unis Fabrika cijevi a.d., Derventa 

h) Operator in Belarus 

–  Mogilev Metallurgical Works Joint Stock Company 

Unrelated importer and owner of exports: 

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– 

FB Stahlhandel GmbH  

i) Exporting producers in Turkey 

– 

– 

– 

– 

– 

– 

Cayirova Boru Sanayi ve Ticaret AŞ9 

Yücel Boru ve Profil Endüstrisi AŞ  

Noksel Çelik Boru Sanayi AŞ, Ankara 

Erbosan Erciyas Boru Sanayii ve Ticaret AŞ, Kayseri 

Borusan Mannesmann Boru Sanayi ve Ticaret AŞ, Istanbul 

Toscelik Profil ve Sac Endustrisi AS, Iskenderun. 

In order to avoid any circumvention in the future, dumping margins have been calculated on a 
group-wide basis. 

5. 

Investigation period 

(21)  The  investigation  of  dumping  and  injury  for  the  anti-dumping  investigation  covered 
the  period  from  1  July  2006  to  30  June  2007  ('investigation  period'  or  'IP').  The 
examination of trends in the context of the injury analysis covered the period from 1 
January 2004 to the end of the IP ('period under consideration'). The same IP was also 
used for the Turkey interim review and for the expiry review, which also had the same 
period under consideration. 

(22)  The investigation period for the Ukraine interim review covered the full calendar year 

2007 ('Interpipe investigation period' or 'IIP'). 

6. 

Disclosure 

(23)  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 on imports from certain 

countries 

the  termination  of  the  proceeding  against  imports  from  Bosnia  and 

Herzegovina and Turkey 

(24) 

In  accordance  with  the  provisions  of  the  basic  Regulation,  parties  were  granted  a 
period in which they could make representation subsequent to this disclosure. 

(25)  The  oral  and  written  comments  submitted  by  the  parties  were  considered  and,  when 

appropriate, the definitive findings have been modified accordingly. 

B. PRODUCT CONCERNED AND LIKE PRODUCT 

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For this company as well as for Yücel Boru ve Profil Endüstrisi AŞ and Noksel Çelik Boru Sanayi AŞ, 
Ankara, see recital 143. 

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7. 

Product concerned 

(26)  The product concerned is welded tubes and pipes, of iron or non-alloy steel, of circular 
cross-section and of an external diameter not exceeding 168,3 mm, excluding line pipe 
of a kind used for oil or gas pipelines, casing and tubing of a kind used in drilling for 
oil  or  gas,  precision  tubes  and  tubes  and  pipes  with  attached  fittings  suitable  for 
conducting gases or liquids for use in civil aircraft, originating in Belarus, Bosnia and 
Herzegovina, the People's Republic of China, Russia, Thailand, Turkey and Ukraine. It 
is normally declared within CN codes ex 7306 30 41, ex 7306 30 49, ex 7306 30 72 
and ex 7306 30 77. 

(27)  Welded  tubes  and  pipes  are  used  in  a  wide  range  of  applications  including  amongst 
others, the conveyance of water, steam, natural gas, air and other liquids and gases in 
plumbing,  heating  and  ventilation  systems,  air-conditioner  units,  automatic  sprinkler 
systems,  and  other  similar  uses.  Quite  often  they  are  also  used  for  construction 
purposes, for load-bearing, fence tubing, protection means and scaffoldings. 

(28)  The major raw material for the product concerned is hot-rolled coils, which are formed 
into  tubes.  Welded  tubes  and  pipes  may  then  further  be  treated  by  coating  or 
galvanisation.  These  further  treatments  are  intended  to  increase  the  quality  of  the 
product.  They  are  mostly  delivered  with  plain  ends,  but  can  also  have  bevelled  or 
threaded  ends,  with  or  without  couplings.  The  product  concerned  is  produced  in 
numerous sizes and according to various standards and classifications. They are, to a 
considerable extent, interchangeable with regard to their end-use and, therefore, there 
exists a significant degree of overlap and competition between the various types of the 
product  concerned.  It  is  therefore  concluded,  as  has  been  done  in  previous 
investigations  covering  the  same  product,  that  all  types  of  the  product  concerned 
should be considered as a single product for the purpose of the investigation. 

(29)  For  the  purposes  of  the  expiry  review,  the  Turkey  interim  review  and  the  Ukraine 
interim review, the product concerned is the same as that covered by the original and 
previous investigation, mentioned under recital (1). 

8. 

Like product 

(30)  The  product  produced  in  Belarus,  Bosnia  and  Herzegovina,  the  People's  Republic  of 
China, Russia, Thailand, Turkey and Ukraine and exported to the Community is alike 
in all aspects to the product sold on the domestic market of these countries as well as 
to  the  product  produced  by  the  Community  producers  and  sold  on  the  Community 
market. The same is true with regard to the product produced and sold for export to the 
Community as compared to the product produced and sold in the USA which served as 
a market economy third country for the People's Republic of China and Belarus. All 
these products were therefore considered to be alike within the meaning of Article 1(4) 
of the basic Regulation. 

1. 

GENERAL METHODOLOGY 

C. DUMPING  

(31)  The general methodology set out below has been applied to all exporting operators as 
appropriate.  The  subsequent  presentation  of  the  findings  on  dumping  aspects  for  the 

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countries  concerned  describes  therefore  only  those  issues  which  are  specific  to  a 
particular exporting country. 

2. 

NORMAL VALUE 

(32) 

In accordance with Article 2(2) of the basic Regulation, it was first examined for each 
cooperating exporting producer whether its domestic sales of welded tubes and pipes 
were representative, i.e. whether the total volume of such sales represented at least 5% 
of its total export sales volume to the Community. 

(33)  The  Commission  subsequently  identified  those  types  of  welded  tubes  and  pipes  sold 
domestically that were identical or directly comparable with the types sold for export 
to  the  Community.  With  regard  to  the  examination  on  the  basis  of  product  type,  the 
Commission  considered  domestically  sold  and  exported  product  types,  which  had 
similar  origin,  size  (outside  diameter),  wall  thickness,  outer  finish  and  end  finish  as 
being directly comparable. 

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

(35)  An examination was also made whether the domestic sales of each type of welded tube 
could  be  regarded  as  having  been  made  in  the  ordinary  course  of  trade,  pursuant  to 
Article 2(4) of the basic Regulation. This was done by establishing for each exporting 
producer  in  the  country  concerned,  the  proportion  of  profitable  sales  to  independent 
customers on the domestic market, of each exported type of the product concerned on 
the domestic market during the investigation period. 

(a)  For  those  product  types  where  more  than  80%,  by  volume,  of  sales  on  the 
domestic market were not below unit costs, i.e., where the average sales price of the 
product type concerned was equal to or higher than the average production cost for 
the product type concerned, normal value was calculated as the average price of all 
domestic  sales  of  the  product  type  in  question  irrespective  of  whether  these  sales 
were profitable or not. 

(b)  For those product types where at least 10% but no more than 80%, by volume, 
of  sales  on  the  domestic  market  were  not  below  unit  costs,  normal  value  was 
calculated as the weighted average sales price of those transactions which were made 
at or above unit costs of the type in question. 

(c)  For  those  product  types  where  less  than  10%,  by  volume,  was  sold  on  the 
domestic  market  at  a  price  not  below  unit  cost,  it  was  considered  that  the  product 
type  concerned  was  not  sold  in  the  ordinary  course  of  trade  and  therefore,  normal 
value had to be constructed in accordance with Article 2(3) of the basic Regulation. 

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(36)  For  those  product  types  where  there  were  no  domestic  sales  made  in  the  ordinary 
course  of  trade,  it  was  examined  whether  normal  value  could  be  established  on  the 
basis of the domestic prices of other producers in accordance with Article 2(1) of the 
basic  Regulation.  If  no  reliable  domestic  prices  of  other  producers  were  available 
constructed  normal  value  was  used,  in  accordance  with  Article  2(3)  of  the  basic 
Regulation. 

(37) 

If  the  normal  value  was  constructed  in  accordance  with  Article  2(3)  of  the  basic 
Regulation, the selling, general and administrative expenses ('SG&A') and amount of 
profit  were  based  on  actual  data  pertaining  to  production  and  sales,  in  the  ordinary 
course of trade, of the like product, by the exporting producer in question, pursuant to 
Article 2(3) and (6) of the basic Regulation.  

3. 

EXPORT PRICE 

(38) 

In all cases where the product concerned was exported to independent customers in the 
Community,  the  export  price  was  established  in  accordance  with  Article  2(8)  of  the 
basic Regulation, namely on the basis of export prices actually paid or payable. 

(39)  Where  the  export  sale  was  made  via  a  related  importer  and  it  was  not  deemed  to  be 
reliable,  the  export  price  was  constructed,  pursuant  to  Article  2(9)  of  the  basic 
Regulation, on the basis of the price at which the imported products were first resold 
to an independent buyer, duly adjusted for all costs incurred between importation and 
resale, as well as a reasonable margin for SG&A and profits. In this regard, the related 
importer's own SG&A costs were used. The profit margin was established on the basis 
of the information available from cooperating unrelated importers. 

(40) 

In  cases  where  there  was  no  export  price  and  consequently  no  resale  of  imported 
products  the  export  price  was  constructed,  pursuant  to  Article  2(9)  of  the  basic 
Regulation, on any reasonable basis. 

4. 

COMPARISON 

(41)  The normal value and export prices for comparable product types were compared on 
an ex-works basis. For the purpose of ensuring a fair comparison between the normal 
value  and  the  export  price,  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. Appropriate adjustments were granted in all cases where they 
were found to be reasonable, accurate and supported by verified evidence. 

5. 

DUMPING MARGIN FOR THE COMPANIES INVESTIGATED 

(42)  As a general rule and according to Article 2(11) of the basic Regulation, the dumping 
margin  for  each  exporting  producer  was  established  on  the  basis  of  a  comparison 
between  the  weighted  average  normal  value  with  the  weighted  average  export  price 
per product type.  

(43) 

In  cases  of  groups  of  several  companies  related  to  each  other  a  common  dumping 
margin applicable for all companies in the group, was established, in accordance with 
the standard practice of the Commission in order to avoid potential circumvention of 
the measures. 

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6. 

RESIDUAL DUMPING MARGIN 

(44)  For  non-cooperating  companies,  a  residual  dumping  margin  was  determined  in 

accordance with Article 18 of the basic Regulation, on the basis of the facts available. 

(45) 

In order to determine the residual dumping margin, the level of cooperation was first 
established. The level of cooperation was considered to be high when the volume of 
exports by the cooperating exporting producers was close to that provided by Eurostat 
for  the  country  concerned  and  there  was  no  reason  to  believe  that  any  exporting 
producer abstained from cooperating. In such cases, the residual dumping margin was 
set at the level of the cooperating company with the highest dumping margin, in order 
to ensure the effectiveness of any measure. 

(46) 

In general, where the level of cooperation was low, the residual dumping margin was 
set at the highest margin established for a representative model for another cooperating 
producer.  This  approach  was  also  considered  necessary  in  order  to  avoid  rewarding 
non-cooperation  

7. 

BOSNIA AND HERZEGOVINA  

7.1. 

General remarks 

(47)  The imports from Bosnia and Herzegovina amounted to 33 kilotonnes (KT) in the IP 
and reached a market share of about 2.5%. The largest exporting producer represented 
more  than  90%  of  the  total  production  in  Bosnia  and  Herzegovina  (destined  for 
domestic market and exports). It cooperated with the investigation and replied to the 
questionnaire. 

7.2. 

Normal value 

(48)  The total volume of domestic sales of the like product was representative, as defined 
in recital (32). In accordance with the general methodology described above, normal 
value  was  based  on  prices  paid  or  payable,  in  the  ordinary  course  of  trade,  by 
independent customers in Bosnia and Herzegovina, or, where applicable, constructed. 

7.3. 

Export price 

(49) 

In  all  cases  the  product  concerned  was  sold  to  independent  customers  in  the 
Community.  Thus,  the  export  price  was  based  on  the  prices  paid  or  payable  by 
unrelated  customers  in  the  Community,  pursuant  to  Article  2(8)  of  the  basic 
Regulation. 

(50)  The  exporter  contested  the  transport  cost  rate  alleged  by  the  complainant.  Indeed,  it 
could demonstrate during the on-spot investigation that such costs were lower.  

7.4. 

Comparison 

(51)  The  normal  value  and  export  price  were  compared  on  an  ex-works  basis.  For  the 
purpose of ensuring a fair comparison, due allowance in the form of adjustments was 
made for differences affecting price comparability in accordance with Article 2(10) of 
the basic Regulation. After disclosure, one party questioned alleged adjustments made 
for  physical  characteristics  made  by  the  Commission.  However,  adjustments  for 

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physical characteristics were neither warranted nor actually applied when calculating 
the dumping margin for the sole exporting producer in Bosnia-Herzegovina.  

7.5. 

Dumping margin 

(52)  The comparison between the normal value and the export price on a weighted average 
to weighted average basis was applied and this method showed a dumping margin of 
0,7%. 

(53)  Since the dumping margin is de minimis, i.e. less than 2%, in accordance with Article 
9(3)  of  the  basic  Regulation,  the  proceeding  against  Bosnia  Herzegovina  should  be 
terminated  without  imposition  of  measures.  The  nature  and  impact  of  imports  from 
this country are analysed in the injury part under “other factors”.  

8. 

THE PEOPLE'S REPUBLIC OF CHINA (PRC)  

8.1. 

General remarks 

(54)  As  reported  by  Eurostat  (all  CN  Codes),  Chinese  imports  increased  sharply  in  the 
recent years from 22 KT in 2004 to 111 KT in 2006 (180 KT in the IP). The PRC is 
thus by far the biggest importer on the Community market with a market share which 
increased  from  1.8%  in  2004  to  more  than  13.8%  in  the  IP.  The  co-operating 
producers  have  reported  even  higher  volumes  of  233  KT  exports.  Six  sampled 
companies reported 219 KT. A first implication of this discrepancy is that the market 
penetration  and  share  of  Chinese  exports  is  even  more  significant  than  originally 
thought. 

(55)  This discrepancy in quantities reported by Eurostat and by the co-operating producers 
could  also  correspond  to  a  customs  misdeclaration  of  the  product  concerned.  This 
coincides  with  the  allegations  made  by  the  Community  industry,  which  indicate  that 
the product concerned is being misdeclared. The investigation as a whole has shown 
that  operators  may  sell  different  types  of  tubes  (some  belonging  to  the  product 
concerned,  some  not)  under  the  same  invoice.  It  is  therefore  not  excluded  that, 
depending on how clearly these differences are specified on the invoice, this could be 
used for an incorrect declaration by a declarant of the product concerned under codes 
other than those associated to the product concerned. 

8.2. 

Market economy treatment (MET)  

(56)  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 paragraphs 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. 

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

form below: 

1.  Business  decisions  and  costs  are  made  in  response  to  market  conditions  and 
without State interference. 

2.  Accounting  records  are  independently  audited,  in  line  with  international 
accounting standards and applied for all purposes. 

EN 

18 

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3.  There  are  no  significant  distortions  carried  over  from  the  former  non-market 
economy system. 

4. Legal certainty and stability is provided by bankruptcy and property laws. 

5. Currency exchanges are carried out at the market rate. 

(58)  Following  the  initiation  of  the  present  investigation,  a  sample  of  six  Chinese 
producers/groups of producers ('entities') was selected, all of which had claimed MET 
pursuant to Article 2(7)(b) of the basic Regulation and replied to the MET claim form 
within the given deadlines. Pursuant to their claims they were verified on spot. It is the 
Commission's consistent practice to examine whether a group of related companies as 
a  whole  fulfils  the  conditions  for  MET.  Therefore,  where  a  subsidiary  or  any  other 
company related to the applicant is a producer and/or an exporter and/or a trader of a 
product concerned, the company was invited to complete a separate MET claim form. 

(59)  Pursuant  to  on-spot-verifications  at  the  premises  of  the  six  sampled  entities,  it  was 
decided that all their MET claims had to be rejected. This was due to the fact that none 
of  the  entities  fulfilled  criteria  1,  2,  and  3  (see  analysis  below).  The  investigation 
revealed  that  all  entities  fulfil  criteria  4  and  5.  This  means  that  the  bankruptcy  and 
property  laws  guarantee  stability  and  legal  certainty  and  that  the  exchange  rate 
conversions are carried out at market rates. 

Criterion  1  -  Business  decisions  are  made  in  response  to  market  signals,  without 

significant State interference, and costs reflect market values 

(60) 

In many cases the documentation of the companies was not reliable. Some companies 
presented  different  versions  of  the  same  document  (e.g.  corrected  business  licences, 
two  different  sets  of  Articles  of  Association  with  different  shareholders,  Articles  of 
Association that have never been signed). The local authorities not only accepted such 
a  situation  but  even  issued  corresponding  certificates  and  documents  without  any 
substantiation.  Such  unreliable  documents  made  the  legal  status  of  the  companies 
uncertain and suggested that state influence has not been eliminated.  

(61) 

In  some  other  cases,  there  were  ambiguities  regarding  the  business  license.  In  one 
case, initially a business license was produced which specified neither the start nor the 
end date of operation. At a later stage, a version was produced which contained only 
an end-date. This casts a general doubt on the reliability of documents produced.  

(62)  After the Commission's findings had been disclosed, the companies generally pointed 
out  they  were  privately  owned.  However,  contrary  to  their  claims,  state  interference 
was  also  established  where  there  was  no  or  only  partial  state  ownership.  As 
demonstrated  above,  other  elements  led  to  the  conclusion  that  on  balance  there  was 
significant state interference.  

(63)  The  comments  received  were  not  such  as  to  alter  the  Commission's  findings.  It  was 

concluded that the companies were subject to significant State interference.  

Criterion 2 - Firms have one clear set of independently audited accounting records 

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(64)  A number  of irregularities  were found with  regard to the  accounting practices of the 
investigated companies. For all entities it was found that the accounts were not kept in 
a coherent manner.  

(65)  For example, some irregularities were established with regard to the manner in which 
companies increased their registered capital (the increase of capital did not reflect any 
actual  investment).  In  some  cases  the  value  of  the  company's  equity  was  never 
deposited  in  cash  or  in  kind.  In  some  other  cases,  bad  debts  were  not  booked  in 
accordance with international accounting standards. The financial statements of some 
companies  did  not  reflect  the  registered  capital  as  stated  in  the  company  documents 
like Articles of Association  or Business Licence. Irregularities were established with 
regard to depreciation (some companies ceased to depreciate some assets) or land-use 
rights, which were not booked properly. 

(66)  Some entities claimed that the irregularities in the accounting system should not have 
had an impact on the decision on MET to such an extent. According to those claims, 
the  irregularities  in  the  accounting  system,  even  if  numerous,  are  not  sufficient  in 
themselves  to  lead  to  the  conclusion  that  criterion  2  is  not  met.  However,  even 
assuming that criterion 2 could be deemed to be met if accounting irregularities could 
be qualified as minor, in this particular case, as explained in the previous paragraphs, 
the irregularities were not minor. 

(67) 

It  was  also  claimed  in  some  cases  that  the  accounts  were  audited  by  external,  hence 
independent, auditors. However, the auditors did not point out any of the problems that 
were  found  during  the  investigation  and  were  thus  not  in  line  with  international 
accounting  standards.  Therefore,  the  entities  concerned  could  not  demonstrate  that 
they had one clear set of basic accounting records which were independently audited 
in line with international standards. 

Criterion 3 - No distortions carried over from the non-market economy system 

(68)  There  were  also  irregularities  with  regard  to  land-use  contracts.  In  many  cases  no 
proof  of  payment  for  land-use  rights  could  be  presented,  which,  given  the  fact  that 
land is State-owned, exposes those entities to significant state influence. Some entities 
failed  to  present  reliable  evidence  on  the  acquisition  and  transfer  of  shares.  In  some 
cases  the  revaluation  of  assets  had  been  clearly  arbitrary.  The  irregularities  of  the 
privatisation process shed doubts upon all subsequent transfers of shares and seem to 
be the source of power for local authorities to interfere with the operation of some of 
the companies. 

(69)  Consequently,  the  irregularities  concerning  the  privatisation  process  still  have  an 
impact on the current situation and operations of the companies, since the production 
costs and the value of assets are subject to significant distortions carried over from the 
former non-market economy system. 

(70)  The  Advisory  Committee  was  consulted  and  the  parties  directly  concerned  were 
informed  accordingly.  The  Community  industry  was  given  the  opportunity  to 
comment, but no comments were received concerning the MET determination. 

(71)  The Commission received comments from the MET applicants. Those comments have 
been  addressed  where  appropriate,  either  in  the  analysis  above  or  in  an  individual 

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reply to the exporter concerned. However, none of the comments received was such as 
to alter the findings on market economy treatment.  

8.3. 

Individual treatment (IT) 

(72)  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. 

(73)  The nature of State interference established for all companies affects their activity as a 
whole.  Therefore,  it  cannot  be  excluded  that  such  an  influence  would  impact  on  the 
determination of export prices and quantities as well as the determination of the terms 
of sale and other related aspects regarding export activity.  

(74)  Equally, it is recalled that the six investigated entities covered almost the totality of the 
exports into the Community. Given this concentration, the relatively small number of 
market operators and the significant level of state interference established with regard 
to all entities investigated, it cannot be excluded that state interference will be used to 
circumvent measures if individual exporters are given different duty rates. 

(75)  Consequently, the companies could not demonstrate that they fulfilled criteria (b) and 

(e), as set out in Art. 9 (5) of the basic Regulation. 

8.4. 

Determination of normal value for all exporting producers not granted MET 

8.4.1.  Analogue country 

(76)  According  to  Article  2(7)  of  the  basic  Regulation,  normal  value  for  companies  to 
which  MET  could  not  be  granted  was  established  on  the  basis  of  the  prices  or 
constructed value in an analogue country. 

(77) 

In notice 1, the Commission indicated its intention to use the USA as an appropriate 
analogue  country  for  the  purpose  of  establishing  normal  value  for  the  PRC  and 
Belarus, and interested parties were invited to comment. One interested party objected 
to  this  proposal,  indicating  that  Turkey  would  be  a  more  appropriate  choice  and 
pointing out that, according to Article 2(7) of the basic Regulation, where appropriate, 
a  market  economy  third  country  which  is  subject  to  the  same  investigation  shall  be 
used. It was further noted that Turkey was used as an analogue country for Ukraine in 
the original investigation.  

(78)  However, the institutions maintained their view that the USA was a more appropriate 
choice of analogue country for the purposes of the present new investigation, in view 
of the arguments set out below.  

(79)  Firstly, the Community institutions would agree, in principle, that in a review it would 
be logical to take as a starting point to use the same analogue country as in the original 
investigation  (although  even  in  a  review  there  may  be  valid  reasons  for  a  change). 
However, in as far as the PRC and Belarus are concerned, this regulation is not based 
on  a  review,  but  on  a  new  investigation.  Such  considerations  there  do  not  apply. 

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Moreover, as explained elsewhere in this Regulation, pursuant to the WTO beef  and 
rice  (Mexico)  Appellate  Body  report,10  those  Turkish  companies  who  were  found  to 
have a zero-duty in the original investigation were not considered to be subject to the 
present  proceeding.  The  institutions  therefore  do  not  have  a  full  picture  of  normal 
value  on  the  Turkish  market.  In  addition,  certain  distortions  appear  to  exist  on  the 
Turkish market. In particular, the market share of imports in Turkey was very low, at 
3,3%,  whereas  the  market  penetration  of  imports  in  the  USA  was  at  39%.  Such  low 
market share of imports may point to some impediment in international competition on 
the  Turkish  market,  despite  that  fact  that  there  are  around  15  known  producers  in 
Turkey.  

(80)  On the other hand, the USA is a large market for welded tubes in general and for the 
product  concerned,  of  a  similar  size  as  the  Community.  The  degree  of  competition 
appears  to  be  significant.  There  appear  to  be  more  than  15  domestic  producers  in 
competition with each other, accounting for a significant level of domestic sales when 
compared to Chinese exports to the Community. 

(81) 

In  addition,  there  are  significant  imports  into  the  USA  from  third  countries, 
notwithstanding the existence of anti-dumping measures during the IP on imports from 
several  countries  (Taiwan,  Mexico,  Turkey,  Thailand,  Brazil,  India,  and  Korea). 
During  the  IP,  imports  were  estimated  to  cover  more  than  a  third  of  the  US 
consumption,  and  originated,  for  ca.  three  quarters  of  the  volume  of  imports,  from 
countries  which  were  subject  to  0%  customs  duties  and  not  subject  to  anti-dumping 
duties.  In  fact,  the  IP  corresponds  to  a  period  where  the  USA  authorities  were 
investigating  the  Chinese  exports  for  the  alleged  injurious  dumping  practices,  which 
led in January 2008 to the imposition of measures (later amended in April 2008 and 
ranging  from  69,2%  to  85,55%).11  These  measures  thus  have  had  no  discernible 
impact on the aforementioned analysis, but rather point to the price levels in the USA 
during  the  IP  which  could  well  be  artificially  suppressed  or  depressed  due  to  the 
impact of the dumped Chinese imports.  

(82)  Furthermore, the production process and the access to raw materials are comparable in 
the  USA  and  the  PRC,  the  latter  not  appearing  to  enjoy  any  discernible  natural 
advantage in the production and sale of the product concerned. 

(83)  Comparing Turkey and the USA on that basis, it has been concluded that the USA is a 

more appropriate analogue country for the PRC and Belarus.  

(84)  Questionnaires  were  sent  to  all  known  producers  in  the  USA.  The  Commission 
received  a  reply  from  a  significant  producer.  Both  the  production  and  the  domestic 
sales of the co-operating producer were representative for the purpose of establishing 
normal value. 

8.4.2.  Determination of normal value in the analogue country 

10 

11 

Appellate  Body  report  on  Mexico  –  Definitive  Anti-Dumping  Measures  on  Beef  and  Rice:  Complaint 
with  Respect  to  Rice  (WT/DS295/AB/R)  and  the  Panel  report  (WT/DS295/R),  as  modified  by  the 
Appellate Body report. 
Federal Register / Vol. 73, No. 10 / Tuesday, January 15, 2008 / Notices, p. 2456; Federal Register / 
Vol. 73, No. 80 / Thursday, April 24, 2008 / Notices, p. 22130. 

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(85)  Following the choice of USA as an analogue country and pursuant to Article 2(7)(a) of 
the  basic  Regulation,  normal  value  was  established  on  the  basis  of  information 
received from the co-operating producer in the analogue country, i.e. on the basis of 
prices paid or payable, in accordance with the methodology set out in recitals (32) to 
(37) above. 

(86)  The domestic sales of the producer of the like product were found to be representative 
compared  to  the  product  concerned  exported  to  the  Community  by  the  exporting 
producers in the PRC. Furthermore, its domestic sales were considered to be made in 
the ordinary course of trade. 

8.5. 

Export price 

(87)  Where export sales to the Community were made directly to independent customers, 
the 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. 

(88)  Where  export  sales  to  the  Community  were  made  through  unrelated  trading 
companies,  export  prices  were  established  on  the  basis  of  the  prices  of  the  product 
when  sold  for  export  to  the  trading  companies  i.e.  to  an  unrelated  buyer,  by  the 
producers concerned in accordance with Article 2(8) of the basic Regulation.  

8.6. 

Comparison 

(89)  The  normal  value  and  export  prices  were  compared  on  an  ex-works  basis.  For  the 
purpose of ensuring a fair comparison between the normal value and the export price, 
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. 
Appropriate  adjustments  concerning  transport  and  insurance,  credit,  commission  and 
bank  charges  were  granted  where  warranted.  Due  adjustments  were  also  made  for 
physical differences, wherever necessary. 

8.7. 

Determination of Dumping  

(90) 

In  order  to  calculate  the  country-wide  dumping  margin  applicable  to  all  exporters  in 
the PRC, the Commission first established the level of cooperation. A comparison was 
made  between  the  total  imports  of  the  product  concerned  originating  in  the  PRC 
calculated  on  the  basis  of  Eurostat  and  the  volume  of  exports  as  reported  in  the 
questionnaire  replies  submitted  by  the  exporters  in  the  PRC.  As  mentioned  above  in 
recital  (54)  there  was  a  discrepancy  between  the  quantity  of  exports  as  reported  by 
Eurostat  and  the  quantity  declared  by  the  exporting  producers  in  their  questionnaire 
replies (180 KT as compared to 216 KT). On this basis it was established that the level 
of cooperation was very high. 

(91)  The  dumping  margin  was  consequently  calculated  as  follows.  The  export  price  was 
calculated  on  the  basis  of  the  detailed  information  provided  by  the  cooperating 
exporters  in  the  questionnaire  replies,  with  the  exception  of  one  entity,  the  reply  of 
which  was  not  complete  and  made  impossible  the  comparison  of  the  physical 
characteristics  of  the  products.  The  export  price  was  compared  to  the  normal  value 
established in the analogue country.  

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(92)  The country-wide level of dumping was established at 130,8% of the CIF Community 

frontier price. 

9. 

BELARUS  

9.1. 

General remarks 

(93)  According  to  Article  2(7)(a)  of  the  basic  Regulation,  Belarus  is  not  considered  a 
market-economy country. Therefore the normal value in respect of Belarusian exports 
to the Community was determined on the basis of data obtained from a producer in a 
market-economy third country. 

(94)  During  the  IP,  imports  from  Belarus  totalled  around  29  KT  and  had  thus  a  market 
share  of  about  2,3%.  The  only  known  Belarusian  manufacturer  co-operated  with  the 
investigation and sent a questionnaire reply. It works under a tolling agreement with 
two importers in Germany and Switzerland. Only the EU-based importer co-operated 
with the investigation.  

(95)  Under the tolling agreement the German importer, who is an independent entity from 
the  Belarusian  manufacturer,  supplies  the  latter  with  the  raw  material  and  covers  all 
expenses  linked  to  their  imports  into  Belarus  (transportation,  handling  and  insurance 
costs). It then pays a tolling fee and covers the transportation, handling and insurance 
expenses  from  Belarus  to  the  EU.  Throughout  the  process  of  manufacturing,  the 
German importer remains the owner of the product concerned exported from Belarus. 
Due to the fact that under the tolling agreement there is no actual export price, it had to 
be constructed.  

(96)  A  comparison  was  made  between  the  total  imports  of  the  product  concerned 
originating in Belarus calculated on the basis of Eurostat (using CN codes ex 7306 30 
41, ex 7306 30 49, ex 7306 30 72 and ex 7306 30 77) and the volume of exports as 
reported in the questionnaire replies submitted by the co-operating manufacturer and 
the aforementioned German operator. On this basis it was established that the level of 
cooperation was low, i.e. 30% of the overall Belarusian exports to the Community. 

(97)  There were no requests for individual treatment pursuant to Article 9(5) of the basic 

Regulation. 

9.2. 

Normal value 

(98)  Normal  value  was  established  on  the  basis  of  the  prices  or  constructed  value  in  an 

analogue country, pursuant to Article 2(7) of the basic Regulation. 

9.2.1.  Analogue country 

(99)  As  mentioned  above  in  the  part  concerning  the  PRC,  notice  1  indicated  USA  as  an 
appropriate analogue country for the purpose of establishing normal value for Belarus 
as  well  as  the  PRC.  The  main  reasons  justifying  the  choice  of  the  USA,  mentioned 
above  in  the  analysis  of  the  PRC,  also  apply  to  Belarus.  Two  parties  opposed  the 
choice  of  the  USA  as  an  analogue  country  and  suggested  Turkey  instead.  The  main 
reasons that led the Commission to choose the USA over Turkey have been outlined in 
recitals (76) to (84) above.  

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(100)  Consequently,  the  methodology  detailed  in  recitals  (32)  to  (37)  has  been  applied  to 

determine the normal value.  

9.3. 

Export price  

(101)  The  data  furnished  by  the  German  importer  only  related  to  a  part  of  the  products 
originating in Belarus and exported to the Community. No data were furnished for the 
other,  very  substantial  part  of  those  imports.  Therefore,  use  had  to  be  made,  with 
regard to that latter part to the best facts available pursuant to Article 18 of the basic 
Regulation.  

(102)  Two  main  sources  of  information  were  analysed.  Eurostat  data  was  not  considered 
adequate. Firstly, it contained tolling transactions with the German operator for which 
there  was  no  export  price.  Secondly,  it  contained  also  tolling  transactions  with  the 
Swiss company which did not co-operate. It should also be stressed that, according to 
the claim by certain parties, and according to the website of the Interpipe Group, the 
Ukrainian company which is the subject of the Ukraine interim review, this group is 
related both to the Swiss company and to the Belarusian company. In the absence of 
any co-operation  from the Swiss company, no  export prices  could be established for 
the transactions made by it.  

(103)  On the other hand, the detailed type-by-type data from transactions associated with the 
aforementioned  German  operator,  including  the  operator’s  cost  and  expenses,  were 
available.  This  allowed  the  investigating  authority  to  establish  the  export  price  on  a 
type-by-type  basis,  as  explained  below.  This  was  therefore  considered  the  best 
information available to the Commission.  

(104)  The  export  price  was  constructed  on  the  basis  of  the  price  of  the  product  concerned 
sold  to  the  first  independent  customer  of  the  co-operating  German  importer.  In  this 
specific case, due to the tolling agreement, certain adjustments had to be made in order 
to establish a reliable export price, at the Community frontier level. Adjustments were 
thus  made  for  all  costs  incurred  between  the  Community  border  and  the  first 
independent  customer  of  the  German  importer.  These  included  SG&A  and  profit  of 
the German importer, as well as transportation, insurance and custom fees within the 
Community. 

9.4. 

Comparison 

(105)  The  normal  value  and  export  prices  were  compared  on  an  ex-works  basis.  For  the 
purpose of ensuring a fair comparison between the normal value and the export price, 
due allowances in the form of adjustments were made for differences affecting prices 
and  price  comparability  in  accordance  with  Article  2(10)  of  the  basic  Regulation. 
Appropriate adjustments concerning physical characteristics, transport, insurance costs 
and customs charges were granted where they were found to be justified, accurate and 
supported by verified evidence. 

9.5. 

Determination of dumping  

(106)  On this basis the country-wide level of dumping was established at 92,4% of the CIF 

Community frontier price. 

10. 

RUSSIA  

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10.1.  General remarks 

(107)  The volume of Russian imports amounted to around 36 KT, corresponding to a market 

share of 3.3% in the IP.  

(108)  Due  to  the  apparent  large  number  of  exporting  producers,  a  sample  was  initially 
selected.  In  that  context,  four  groups  were  notified  to  reply  to  the  Commission's 
questionnaire,  but  replies  were  received  only  from  two,  therefore  sampling  was  no 
longer necessary.  

10.2.  Normal value 

(109)  For  both  exporting  producers,  domestic  sales  of  the  product  concerned  were 
representative as defined in recital (32). In accordance with the methodology described 
in  recitals  (33)  et  seq.,  normal  value  was  based  on  prices  paid  or  payable,  in  the 
ordinary course of trade, by independent customers in the Russian Federation. 

(110)  With  regard  to  manufacturing  costs,  and  in  particular  energy  costs,  as  far  as  gas  is 
concerned,  it  was  examined  whether  the  gas  prices  paid  by  the  exporting  producers 
reasonably reflected the costs associated with the production and distribution of gas. 

(111)  It was found that the domestic gas price paid by the exporting producers was around 
one fourth of the export price of natural gas from Russia. In this regard, all available 
data  indicates  that  domestic  gas  prices  in  Russia  are  regulated  prices,  which  are  far 
below market prices paid in unregulated markets for natural gas. Therefore, since gas 
costs were not reasonably reflected in the exporting producers' records as provided for 
in  Article  2(5)  of  the  basic  Regulation,  they  had  to  be  adjusted  accordingly.  In  the 
absence  of  any  sufficiently  representative,  undistorted  gas  prices  relating  to  the 
Russian  domestic  market,  it  was  considered  appropriate  to  base  the  adjustment,  in 
accordance  with  Article  2(5),  on  the  basis  of  information  from  other  representative 
markets. The adjusted price was based on the average price of Russian gas when sold 
for  export  at  the  German/Czech  border  (Waidhaus),  adjusted  for  local  distribution 
costs. Waidhaus, being the main hub for Russian gas sales to the EU, which is both the 
largest  market  for  the  Russian  gas  and  has  prices  reasonably  reflecting  costs,  can  be 
considered  a  representative  market  within  the  meaning  of  Article  2(5)  of  the  basic 
Regulation. 

(112)  For those product types where the normal value was constructed, as described above, 
the  construction  was  done  on  the  basis  of  the  manufacturing  costs  of  the  exported 
types after the adjustment for the gas cost. 

10.3. 

Export price 

(113)  For  those  cases  where  exports  to  the  Community  were  made  via  a  related  importer 
located in the Community, a constructed export price has been established pursuant to 
Article 2(9) of the basic Regulation. In cases where exports were made to independent 
customers  in  the  Community,  via  a  related  trader  located  in  the  Russian  Federation, 
export  prices  were  based  on  prices  paid  or  payable  by  independent  customers  in  the 
Community. 

10.4.  Comparison 

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(114)  Appropriate adjustments concerning credit, transport costs and ancillary charges were 
made where they were found to be warranted and supported by verified evidence. 

10.5.  Dumping margin 

(115)  The comparison between the normal value and the export price showed the existence 
of  dumping.  After  disclosure,  comments  were  submitted  by  both  Russian  exporting 
producers.  In  the  first  case,  substantiated  comments,  dealing  in  particular  with 
adjustments  on  constructed  normal  values,  led  to  a  minor  change  of  the  dumping 
margin, which will have no impact on the anti-dumping duty, as the revised dumping 
margin is still above the injury margin. In the second case, the interested party pointed 
to  a  clerical  mistake  leading  to  the  double  counting  of  the  SG&A;  this  mistake  has 
been corrected. On that basis, the dumping margins (per group of exporting producer) 
expressed  as  a  percentage  of  the  CIF  import  price  at  the  Community  border,  duty 
unpaid, are the following: 

– 

– 

TMK Group (Seversky Pipe Plant Open Joint Stock Company and Joint Stock 
Company Taganrog Metallurgical Works) – 22,7% 

OMK Group (Open Joint Stock Company Vyksa Steel Works and Joint Stock 
Company Almetjvesk Pipe Plant) – 10,1% 

10.6.  Conclusions on dumping regarding Russia 

(116)  Since the level of cooperation was high (more than 90 % of the exports of the product 
concerned from the Russian Federation to the Community, as reported in Eurostat), the 
residual  dumping  margin  applicable  to  all  other  exporters  in  the  Russian  Federation 
was set at the same level as the one established for the cooperating exporting producer 
TMK Group, namely 22,7%. 

D. LIKELIHOOD OF A CONTINUATION AND/OR RECURRENCE OF DUMPING 
ACCORDING TO ARTICLE 11(2) OF THE BASIC REGULATION; ADEQUACY OF 
THE LEVEL OF THE MESURE AS REGARDS DUMPING ACCORDING TO 
ARTICLE 11(3) OF THE BASIC REGULATION. 

1. 

GENERAL 

(117)  In  accordance  with  Article  11(2)  of  the  basic  Regulation,  it  was  examined  whether 
dumping  was  likely  to  continue  or  recur  upon  a  possible  expiry  of  the  measures  in 
force against Thailand, Turkey and the Ukraine. 

(118)  Further, in accordance with Article 11(3) of the basic Regulation, for Turkey and for 
the  one  Ukrainian  company,  it  was  examined  whether  there  were  changed 
circumstances  since  the  original  investigation  regarding  dumping  which  could  be 
considered to be of a lasting nature.  

2. 

THAILAND  

2.1. 

Preliminary remarks  

(119)  Unlike  in  the  original  investigation  there  were  no  exports  of  the  product  concerned 
from Thailand in the IP according to Eurostat data. The single co-operating producer 

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declared  no  export  sales  to  the  Community,  and  no  other  exporting  operators  co-
operated. Thai export statistics did suggest that there were some Thai exports recorded 
in the IP that could relate also in part to the product concerned but these were in any 
event negligible in terms of volume and would thus not have been representative. 

(120)  The cooperation level in the current review was very low, with only one Thai producer 
making itself known in the course of the proceeding. According to the complaint and 
as  confirmed  from  publicly  available  data,  there  were  however  at  least  twelve  other 
producers  of  the  product  concerned  in  Thailand  during  the  IP.  None  of  these 
cooperated  in  the  investigation  and  as  a  consequence  the  cooperation  level 
corresponded  to  less  than  10%  of  the  total  estimated  Thai  production  of  the  product 
concerned. 

2.2. 

Dumping of imports during the investigation period 

(121)  The single cooperating Thai producer had no exports to the Community during the IP. 
Considering  that  there  were  no  exports  of  the  product  concerned  to  the  Community 
originating in Thailand, there could be no continuation of dumping. It follows that the 
analysis in this case has to be based on the likelihood of recurrence of dumping should 
measures be terminated. 

2.3. 

Development of imports should measures be repealed 

2.3.1.  Preliminary remarks 

(122)  As  outlined  in  recital  (120),  the  investigation  has  shown  that  there  were  at  least 
thirteen  producers  of  the  product  concerned  in  Thailand  during  the  IP  and  only  one 
cooperated in the investigation.  

(123)  It was examined to what extent data from the one cooperating Thai producer could be 
used  for  the  purpose  of  analysing  the  overall  situation  pertaining  to  the  likely 
development  of  exports  from  Thailand  as  well  as,  more  specifically,  to  serve  as  a 
benchmark  in  terms  of  indicators  of  domestic  and  export  prices,  costs,  production 
capacities and capacity utilisation. 

(124)  In this respect a number of deficiencies were noted in relation to the data provided by 
the cooperating company. Firstly, the company was unable to reconcile domestic and 
export  prices  with  actual  transactions  and  with  its  audited  accounts  for  the  IP. 
Furthermore the company could not provide a breakdown of the cost of production by 
product  control  number,  as  defined  in  the  questionnaires  sent  to  interested  parties 
('PCN'). The producer was only able to provide the cost of production as the average 
of the cost of production broken down between black and galvanised of all the PCNs 
produced.  Evidence  of  the  PCNs'  cost  structure  from  different  producers  in  other 
countries concerned by the investigation including the Community, showed that there 
indeed is a large variation in the cost of production per PCN. This also applies to the 
specific  product  types  produced  and  sold  by  the  Thai  company  in  question.  Under 
these  circumstances,  a  cost  breakdown  that  does  not  allow  a  comparison  per  PCN 
cannot be considered sufficient for the purpose of determining domestic normal value.  

(125)  Even in the event that such data could have been obtained it should be borne in mind 
that the co-operating producer corresponded to less than 10% of the total production of 

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the product concerned in Thailand meaning that the data in any event would have to be 
complemented  by  other  statistical  material  in  order  to  assess  the  representativity  for 
the purpose of the country wide assessment. 

(126)  The  company  was  notified  of  the  Commission's  intention  to  apply Article  18  of 
the basic Regulation and the reasons for which this was considered necessary within a 
reasonable  period  of  time,  due  account  being  taken  of  the  time-limits  of  the 
investigation.  Comments were received, thoroughly analysed and replied to in detail. 
None  of explanations  given  by  the  company was considered  to  be  satisfactory  as 
to allow  the  Commission  to  avoid  the  application  of  best  facts  available  to  the areas 
highlighted above. 

(127)  Consequently,  information  on  domestic  and  export  prices  to  other  countries  for  Thai 
exporters has been based on best facts available including the complaint and publicly 
available information.  

(128)  Conversely,  data  pertaining  to  stocks,  production  level  and  capacity  that  had  been 
provided by the company could be verified. This information in conjunction with data 
from  the  complaint  could  therefore  be  used  to  establish  the  production  volume  and 
capacity of all exporting producers in Thailand. 

(129)  In  view  of  the  above,  the  following  considerations  were  taken  into  account  when 

assessing the likely impact should measures be repealed. 

2.3.2.  Production, unused capacities and likelihood that these capacities would be directed 

to the Community  

(130)  The complaint shows a spare capacity in Thailand of more than 370 KT, accounting 
for  almost  30%  of  the  total  capacity.  This  spare  capacity  corresponds  to  more  than 
25% of the total Community consumption (as defined in recital (231)) which could be 
directed toward the Community market. 

(131)  The  level  of  spare  capacity  was  even  more  pronounced  in  the  cooperating  producer, 
which  represented  less  than  10%  of  the  Thai  total  production  in  the  IP.  For  this 
producer, spare capacities of above 50% were found in the IP.  

(132)  Together, these factors point to the existence of significant spare capacity in Thailand. 
In the absence of evidence showing that this capacity could be absorbed by increased 
domestic sales, sales to other third countries or the production of products other than 
the  product  concerned,  it  is  concluded  that  should  measures  expire,  such  spare 
capacities  would  in  all  likelihood  be  directed  towards  the  Community,  not  least 
because of the Community's attractiveness as an export market. 

(133)  Considering  that  the  Community  market  is  one  of  the  biggest  in  the  world,  its  sheer 
size makes it attractive to any Thai exporting producer of the product concerned. The 
potential importance of the Community market is further enhanced by the fact that the 
US  which  is  another  major  market,  has  measures  in  place  against  imports  from 
Thailand. 

(134)  Taken together with the relatively attractive price level in the Community, where well 
developed distribution channels exist, it is considered that, in the absence of measures, 

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there would be a clear economic incentive for a shift of exports away from major third 
markets such as the US and towards the Community. 

(135)  Overall,  under  these  circumstances  it  is  considered  that  any  increase  in  the  current 
capacity  utilisation  is  likely  to  be  directed  towards  exports,  and  specifically  to  the 
Community market. 

2.3.3.  Likely price levels 

(136)  A number of factors point to the likelihood that Thai export prices to the Community 

would be dumped. 

(137)  To  start  with,  exports  to  major  third  country  markets  appear  to  have  been  made  at 
dumped prices. This was confirmed by the existence of US anti-dumping measures in 
the  range  of  15%  for  Thai  exports  of  welded  tubes.  This  points  to  a  more  general 
pattern  of  behaviour  based  on  dumping  to  large  third  markets.  The  fact  that  Thai 
exports to the Community stopped after measures were imposed appears to reinforce 
the  idea  that  Thai  exporting  producers  would  be  unable  or  unwilling  to  sell  at  non-
dumped price levels.  

(138)  In  addition,  for  the  product  under  consideration,  which  is  in  general  rather 
homogeneous,  would-be  Thai  sellers  would  be  likely  to  provide  products  at  the 
prevailing  prices  of  other  imports  in  the  Community.  As  has  been  concluded  in  the 
sections above, the import prices of other exporting countries are generally low. When 
considering that potential export prices of Thai producing exporters are likely to have 
to  mirror  these  low  prices  and  when  considering  the  cost  structure  of  the  product 
concerned,  which  is  heavily  based  on  steel  coil  and  zinc  prices  that  have  seen  a 
significant increases across the world, it would be likely that export prices would be 
dumped.  

2.4. 

Conclusion 

(139)  A  significant  amount  of  Thai  exports  would  therefore  be  likely  to  be  sold  in  the 

Community at dumped prices should measures be allowed to lapse. 

3. 

TURKEY (i): GENERAL DUMPING AND ARTICLE 11(2) ASPECTS  

3.1. 

General issues 

(140)  The complainant claimed that the dumped imports from Turkey would likely lead to a 
very  serious  injury  to  the  Community  industry,  should  the  measures  be  allowed  to 
lapse. In the context of the interim review (see below) the complainant submitted that 
the measures should be adjusted upwards due to the allegedly increased dumping and 
injury levels.  

(141)  Statistical  data  showed  that  imports  from  Turkey  amounted  to  110  KT,  representing 
almost 9% of the Community consumption (as defined in recital (231)). There was a 
discrepancy  between  the  amounts  reported  by  Eurostat  and  those  reported  by  the 
companies (138 KT). Reference is made to comments made under recital (55).  

(142)  The  general  methodology  used  to  calculate  dumping  (set  out  in  recitals  (31)  to  (46) 
above)  has  been  applied  to  all  exporting  producers  in  Turkey.  It  differs  from  the 

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to  significant  currency  fluctuations  during 

methodology  applied  in  the  original  investigation,  which  was  used  exceptionally  for 
the  original 
some  exporters  due 
investigation period. Due to these fluctuations, it was considered more appropriate in 
the  original  investigation  to  make  a  comparison  between  the  monthly  weighted 
average normal value and the monthly weighted average export price. However, these 
exceptional  circumstances  were  absent  in  the  current  investigation  and  the  standard 
methodology, as described in recitals (31) to (46) above, was applied instead. Thus, in 
the  current  investigation,  the  dumping  margin  for  the  exporting  producers  in  Turkey 
was established on the basis of a comparison of a weighted average normal value with 
a weighted average export price.  

(143)  The following companies: Cayirova Boru Sanayi ve Ticaret AS, Istanbul, Yücel Boru 
ve Profil Endüstrisi AS, Istanbul, and Noksel Çelik Boru Sanayi AŞ, Ankara, each of 
whose individual dumping margin in the original investigation was zero, were initially 
investigated in the review and chosen as part of the sample. However, although Article 
9(3) of the basic Regulation provides that companies with a zero or de minimis margin 
in  the  original  investigation  may  be  included  in  a  review,  it  does  not  oblige  the 
Community  institutions  to  include  such  companies.  Moreover,  after  the  adoption  of 
the basic Regulation, in the case Mexico-Beef and Rice, the WTO dispute settlement 
body has interpreted the relevant provision of the ADA as prohibiting reviews of such 
companies. Therefore, the Community institutions concluded that it is appropriate not 
to  use  data  gathered  during  the  review  concerning  these  three  companies. 
Consequently,  these  companies  were  excluded  from  the  sample.  Moreover,  in  this 
Regulation,  it  is  assumed  that  none  of  these  companies  are  currently  engaged  in 
dumping. 

3.2. 

Sampling (exporters) and co-operation 

(144)  Sampling forms were sent out to 15 potential producers/exporters in Turkey and 8 of 
them responded. Three companies/groups, which account for 41% of the total Turkish 
imports into the Community, were selected for the sample.  

3.3. 

Normal value 

(145)  As  mentioned  above  the  normal  value  was  either  constructed  or  established  on  the 
basis  of  prices  paid  or  payable,  in  the  ordinary  course  of  trade,  by  independent 
customers  in  Turkey.  Some  of  the  adjustments  claimed  by  the  exporting  producers 
have been rejected or amended. 

3.3.1.  Credit costs 

(146)  Following the disclosure of the Commission's findings some of the exporters claimed 
that credit costs should be established on the basis of the actual payment terms agreed 
between the producers and their customers. These claims were accepted.  

3.3.2.  Duty drawback 

(147)  Certain  companies  claimed  an  allowance  for  duty  drawbacks  on  the  grounds  that 
import  charges  were  levied  on  the  raw  material  used  for  the  like  product  when 
intended for consumption in Turkey but were refunded when the product was sold for 
export to the Community. 

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(148)  In one case, the amount claimed was found to be higher than the amount of duty levied 
on materials physically incorporated in the like product sold in the domestic market. It 
was  established  that  the  duty  burden  was  less  because  that  company/group  of 
companies used in their domestic production not only coils imported with a duty but 
also  coils  imported  with  0%  duty  rate,  as  well  as  locally  purchased  coils. 
Consequently, the allowances were adjusted accordingly. 

(149)  Another  company  for  which  the  allowance  was  originally  rejected  claimed  that  it 
should have  been  allowed as their domestically sold products did bear the burden of 
the duty. The claim was partly accepted.  

(150)  In  this  context,  it  was  claimed  by  the  Community  industry  that  this  would  be  a 
countervailable subsidy. However, it has to be noted that the present proceeding is an 
anti-dumping investigation. Therefore, this allegation has not been analysed. 

3.3.3.  Selling, general and administrative expenses (SG&A) 

(151)  One of the Turkish exporters, for those of its sales for which the normal value had to 
be  constructed,  claimed  negative  SG&A.  This  was  due  to  the  fact  that  their  foreign 
currency exchange gains were substantial and higher than the total amount of SG&A. 
In this case those financial gains were disregarded. Only financial costs related to the 
companies' loans were taken into account. The SG&A were thus adjusted accordingly.  

3.4. 

Export price 

(152)  In  all  cases  the  product  concerned  was  sold  to  independent  customers  in  the 
Community. Thus, for all exporters, the export price was based on the prices paid or 
payable  by  unrelated  customers  in  the  Community,  pursuant  to  Article  2(8)  of  the 
basic Regulation. 

3.5. 

Comparison 

(153)  The  normal  value  and  export  price  were  compared  on  an  ex-works  basis.  For  the 
purpose of ensuring a fair comparison, due allowance in the form of adjustments was 
made for differences affecting price comparability in accordance with Article 2(10) of 
the  basic  Regulation.  Accordingly,  adjustments  were  made  for  rebates,  discounts, 
transport, handling, charging costs, bank charges and insurance and credit costs, where 
appropriate and supported by verified evidence. 

3.6. 

Dumping during the investigation period 

(154)  The  dumping  margin  for  the  exporting  producers  in  Turkey  was  established  on  the 
basis  of  a  comparison  of  a  weighted  average  normal  value  with  a  weighted  average 
export price, in accordance with Article 2(11) and (12) of the basic Regulation. 

(155)  The  comparison  of  weighted  average  export  prices  with  a  weighted  average  normal 

value showed the following dumping margins: 

– 

– 

Erbosan Erciyas Boru Sanayii ve Ticaret AŞ, Kayseri ('Erbosan')  0,5%, 

Borusan Mannesmann Boru Sanayi ve Ticaret AŞ, Istanbul ('Borusan') -1,4%, 

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– 

Toscelik Profil ve Sac Endustrisi AS, Iskenderun ('Toscelik') 

0,9%.  

(156)  Two  companies  declared  their  intention  to  co-operate  but  were  not  included  in  the 
sample.  Given  that  the  dumping  margins  determined  for  all  the  companies  in  the 
sample were de minimis and the co-operation in the investigation was very high, the 
countrywide dumping margin was also considered to be de minimis. 

(157)  Therefore,  it  is  concluded  that  there  was  no  continuation  of  dumping  in  case  of 
Turkey. The further analysis in the framework of Article 11(3) of the basic Regulation 
will therefore solely concentrate on the likelihood of recurrence of dumping. 

3.7. 

Likelihood analysis  

3.7.1.  General remarks 

(158)  The EU market is undeniably a very attractive market for the Turkish producers. This 
is due to a number of factors, the first of which is size. Size pertains not only to the 
large consumption, but also to the fact that most Turkish exports to other third country 
markets  are  fragmented  -  i.e.  small  quantities  being  shipped  to  many  different 
destinations.  In  that  sense  the  Community  is  more  attractive  as  a  single  destination 
with large absorption capacity.  

(159)  Geographical  proximity  is  another  important  factor,  as  transportation  costs  for  these 

products are not insignificant.  

(160)  The  Community  is  also  a  traditional  market  for  Turkish  exporters  who  have  well 

established distribution channels and a wide range of clients. 

3.7.2.  Share of exports to the EU and pricing practices 

(161)  Despite  the  measures  in  force  exports  from  Turkey  continued  throughout  the  IP. 
However, no dumping was found for any of the sampled companies. It should be noted 
that  the  sampled  companies  and  the  non-sampled  companies  that  co-operated  in  the 
current reviews as well as those whose margin in the original investigation was found 
to be zero or de minimis cover around 90% of total Turkish exports to the Community. 
The  market  for  these  Turkish  exports  appears  to  be  stable  and  there  is  no  indication 
that  the  companies  would  change  their  pricing  strategies.  Furthermore,  the  three 
sampled  companies  as  well  as  those  three  whose  dumping  margin  in  the  original 
investigation was found to be zero or de minimis are by far the biggest players on the 
market and price leaders. Therefore, it is likely that any other company would rather 
follow  their  pricing  practices.  It  thus  appears  unlikely  that  dumping  would  recur  for 
Turkey.  Nevertheless,  for  the  sake  of  completeness,  the  factors  below  were  also 
examined. 

3.7.3.  Unused capacity in Turkey  

(162)  The investigation established a total spare capacity of about 143 000 tonnes in the IP 
for  the  co-operating  producers,  including sampled  and  non-sampled  companies.  This 
quantity  would  correspond  to  around  10%  of  the  total  Community  consumption  (as 
defined in recital (231)) of welded tubes. 

3.7.4.  Possible absorption capacity of third country markets  

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(163)  The  largest  third-country  market  for  the  product  concerned  (the  USA)  has 
antidumping measures in place for Turkish exports ranging up to 14,7%. This would 
imply that, other things being equal, the USA would not be likely to absorb significant 
additional  export  quantities  from  Turkey.  However,  the  fact  that  the  exports  to  third 
countries  are  fragmented  with  shipments  to  many  different  destinations  appears  to 
indicate  that  the  Turkish  exporters  are  actively  in  the  process  of  exploring  new 
markets, and it is therefore not unlikely that third country markets could absorb some 
of the capacities. In addition, taking into account the actual ratio of Turkish exports to 
the  Community  and  to  third  countries  (70/30),  the  same  ratio  can  reasonably  be 
expected if the currently unused capacities were sold. This would then amount to an 
additional  import  into  the  Community  of  around  100  000  tonnes,  which  would 
correspond to an additional market share of 7 %, based on the IP consumption figures. 
It  has  to  be  noted,  however,  that  this  would  be  the  maximum  theoretical  increase  of 
sales  based  on  the  assumption  that  the  spare  capacity  is  used  at  the  rate  of  100%, 
industry.  
which 

such 

rare 

in 

is 

3.7.5.  Price factors 

(164)  The  price  differences  between  Turkish  exports  to  the  Community  and  to  third 
countries  have  not  been  significant  and  depended  on  the  company  concerned.  After 
further analysis subsequent to the disclosure, it was established that the Turkish export 
prices to third countries were slightly higher than those to the Community. Given that 
no dumping was established for Turkey in respect of their exports to the Community, 
it can be assumed that generally exports to third countries were not made at dumped 
prices. There are also no other indications that Turkish exporters would change their 
price  strategy.  Nothing  in  the  circumstances  of  the  market  or  the  situation  of  the 
exporters  as  a  whole  showed  that  they  were  likely  to  change  their  overall  market 
behaviour.  

(165)  In view of the foregoing it is concluded that dumping is not likely to recur for imports 

originating in Turkey. 

4. 

TURKEY (ii): ARTICLE 11(3) ASPECTS 

(166)  The complainant claimed that the measures in force did not prevent the continuation of 
dumped imports and that the level of measures was no longer sufficient to counteract 
the injurious dumping by imports of the product concerned from Turkey. 

4.1. 

Lasting nature of changed circumstances  

(167)  As  found  above,  imports  from  Turkey  no  longer  continued  to  be  made  at  dumped 
prices. Indeed, all levels of dumping established in the present investigation are below 
the  de  minimis  threshold.  In  particular,  this  is  true  for  three  companies,  which 
originally were found to be dumping. 

(168)  The Community market will, as mentioned, most likely remain an attractive market for 
the  Turkish  exporters  in  terms  of  prices  as  well  as  well-established  and  long-lasting 
commercial relations. At the same time, Turkish producers sell significant volumes on 
their  domestic  market.  These  quantities  are  sold  at  competitive  and  relatively  low 
prices,  when  compared  to  other  major  markets,  including  the  EU  and  USA.  Indeed, 

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34 

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domestic prices and subsequently normal values were at such levels that dumping in 
respect to exports to the Community has disappeared entirely.  

(169)  The investigation has not detected any other circumstances which would suggest that 
the price and dumping are likely to change if measures are allowed to lapse. For the 
companies  that  have  been  subject  to  zero-duties  since  the  original  investigation,  the 
considerations based on the Mexico Beef and Rice report, as explained above in recital 
(143) will continue to apply. As regards the other companies, the present investigation 
indeed showed that circumstances have changed, as they were found not be dumping 
any more. In addition, no compelling reasons are at hand that would indicate that such 
changed  circumstances  are  not  of  a  lasting  nature.  Moreover,  all  investigated 
companies  made  exports  to  third  countries  in  2006  and  the  IP  at  prices  higher  than 
export prices to the Community. In the same periods, exports to the Community were 
made at prices exceeding domestic sale prices. This clearly indicates that the changed 
circumstances (exports no longer dumped) are of a lasting nature.  

4.2. 

Conclusion 

(170)  It  can  therefore  be  concluded  that,  should  the  measures  be  allowed  to  lapse,  the 
exports to the Community will not be likely to be made at dumped  prices. Also,  the 
changed circumstances with respect to the original investigation regarding the lack of 
dumping can reasonably be considered to be of a lasting nature.  

(171)  In  view  of  the  foregoing  the  proceeding  concerning  imports  originating  in  Turkey 

should be terminated. 

5. 

UKRAINE (i): ARTICLE 11(3) ASPECTS  

5.1. 

General remarks 

(172)  The  Interpipe  Group  alleged  that  a  comparison  of  normal  value  based  on  its  own 
costs/domestic prices and its export prices to a third country market comparable to the 
EU, would lead to a reduction of dumping significantly below the level of the current 
measures. Therefore, it is alleged that the continued  imposition  of  the  measure  at  its 
current level was no longer necessary to offset dumping.  

(173)  During the course of the investigation, the company was notified of the Commission's 
intention to apply Article 18 of the basic Regulation. This was because the company 
did  not  provide  cost  of  production  data  in  the  product  type  (product  control  number 
(PCN))  format  required.  The  company  only  submitted  cost  of  production  data  as  an 
average of all the product types produced in a specific workshop.  

(174)  Examination of the facts showed that the cost of production data submitted could not 
be  accepted  by  the  Commission  as  they  would  not  permit  a  proper  comparison  with 
domestic market selling prices by product type. 

(175)  The company was notified of the reasons why this was necessary within a reasonable 
period  of  time as required  by Article  18(4) of the basic Regulation. Comments were 
received,  analysed  and  replied  to  in  detail.  None  of  the  explanations  given  by  the 
company  was  considered  to  be  satisfactory  as  to  allow  the  Commission  to  avoid  the 
application of best facts available to the area highlighted below. 

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35 

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(176)  Following the disclosure, the complainant claimed that the case should be terminated 
as  the  cooperation  of  the  sole  Ukrainian  producer  was  so  poor  that  the  Commission 
had  to  use  Article  18  of  the  basic  Regulation  to  adjust  the  cost  of  manufacturing. 
However,  it  should  be  noted  that  Article  18  was  applied  in  order  to  allow  the 
Commission to complete the information submitted by the sole Ukrainian co-operating 
producer by using the best information available. The claim was therefore rejected. 

5.2. 

Normal value 

(177)  The Commission examined whether the domestic sales could be considered as being 
made in the ordinary course of trade pursuant to Article 2(4) of the basic Regulation. 
To  this  end,  the  cost  of  production  of  the  product  produced  and  sold  by  the  co-
operating exporting producers on the domestic market was examined. 

(178)  OJSC  Interpipe  Novomoskovsk  Pipe  Production  Plant  (NMPP),  which  produces  the 
product concerned, failed to provide a breakdown of the cost of production ('CoP') by 
PCN.  This  exporting  producer  only  provided  the  average  CoP  of  all  the  PCNs 
produced  in  each  of  its  two  workshops.  Evidence  of  the  PCNs'  cost  structure  from 
different  producers  in  other  countries  concerned  by  the  investigation  including  the 
Community showed that there is a large variation in the cost of production per PCN. 

(179)  OJSC  Interpipe  Nizhnedneprovsk  (NTRP)  tube  rolling  plant  which  is  related  to 

NMPP, submitted the break down of the CoP per PCN. 

(180)  As  explained  in  recital  (173),  the  Commission  applied  Article  18  of  the  basic 
Regulation  to  NMPP  to  obtain  the  cost  of  production  by  PCN.  The  option  of  using 
data available from the original investigation was considered, but as Ukraine has since 
been  granted  market  economy  status,  such  data  was  not  considered  to  be  the  best 
information available. In addition, the Commission considered that the quality of the 
information reported by the Community industry was such as would allow conclusions 
to  be  drawn  on  the  Cost  of  Production  (CoP)  per  Product  Control  Number  (PCN). 
Therefore,  the  information  submitted  by  the  co-operating  Community  industry  was 
considered  to  be  the  most  reliable  and  the  best  information  available  from  which  to 
derive the CoP per PCN. In this respect, the findings of the investigation showed that 
the  variances  between  the  cheapest  Community  industry  PCN  and  all  other  PCNs 
could  be  calculated.  This  variance  was  then  applied  to  the  average  CoP  reported  by 
NMPP.  When  there  was  a  match  between  the  PCN  produced  by  the  Community 
industry and the same PCN produced by NTRP, the NTRP cost was used. 

(181)  The  same  party  questioned  the  fact  that  the  Commission  used  data  from  the  IP  to 
construct the normal value and the export price in the IIP. Some of the claims related 
thereto were  accepted. The  Commission considered the weighted average of the CIF 
export  prices  to  the  Community  during  the  overlapping  six  months  of  both 
proceedings.  In  addition,  to  allow  a  fair  comparison  within  the  same  period  of  time, 
between  the  weighted  average  normal  values  of  each  type  of  the  product  concerned 
exported  to  the  Community  when  compared  to  the  weighted  average  export  price  of 
each  corresponding  type  of  the  product  concerned,  the  cost  of  production  of  the  co-
operating  producers  was  adjusted.  The  adjustment  was  made  to  reflect  the  cost  of 
manufacturing for the same six months taken into account to calculate the CIF export 
prices  to  the  Community.  The  sole  Ukrainian  co-operating  exporter  argued  that  the 
Commission should use the unit manufacturing cost from the related company, OJSC 

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36 

   EN 

 
Interpipe  Nizhnedneprovsk  (NTRP)  tube  rolling  plant,  when  the  PCNs  are  nearly 
identical to those produced by OJSC Interpipe Novomoskovsk Pipe Production Plant 
(NMPP). As explained in recital (175), the Commission has however evidence of large 
variations in the cost of production per PCN. This claim thus was rejected. 

5.3. 

Export price 

(182)  As regards to the exports to the Community, the group exported a negligible volume 
of the product concerned to the Community during the IIP. These transactions, on their 
own,  could  not  be  considered  as  representative  to  establish  whether  any  change  of 
behaviour of a lasting nature had taken place. 

(183)  The Interpipe Group suggested using exports to third countries in order to establish the 
level of prices at which the exports to the Community would take place. In particular, 
the exporter claimed that exports to Russia should be used in this regard. The company 
provided evidence of its exports to third country markets, and to the Russian market. 

(184)  It  was  first  determined  whether  the  export  volumes  of  the  product  concerned  to  the 
third countries proposed by the Interpipe Group were sufficiently significant in terms 
of overall sales. In this respect it was concluded that sales to Russia represented more 
than  half  of  the  total  exports  of  the  group  and  were  in  principle  adequate  to  draw 
conclusions, should the Russian market be sufficiently similar to the Community. 

(185)  On the basis of the information at the Commission's disposal, it was examined whether 
Russia  had  similar  market  conditions  and  structure  to  those  which  exist  in  the 
Community, in order to assess whether exports to Russia are a reliable proxy of likely 
export  prices  to  the  Community  for  the  purposes  of  establishing  a  new  level  of  the 
measure.  

(186)  On the one hand, the size of the Russian market for the product concerned, like that of 
the Community, appears to be significant and the product types sold in both areas are 
generally similar. 

(187)  On the other hand, salient differences were detected between the two markets. To start 
with, significant import duties exist in Russia, in contrast to the absence of such duties 
in  the  Community12.  This  is  reflected  in  import  shares  which  are  significantly  lower 
than  in  the  Community.  In  addition,  the  production  sector  in  Russia  appears  to  be 
much more concentrated, with a handful of large producers accounting for the bulk of 
activity  –  whereas  in  the  Community  activity  is  spread  across  a  larger  number  of 
producers. Also, channels of distribution appear to involve fewer stockists than in the 
Community.  Furthermore,  the  fact  that  significant  Russian  dumping  exists  in  the 
Community points to differences in price formation and to distortions in the Russian 
domestic market without which such practices could not exist.  

(188)  In addition, the existence of dumping indicates that domestic price levels in Russia are 
above the prices at which exporters would be likely to export to the Community. This 

12 

In addition a safeguard investigation regarding the product concerned is on-going. If its conclusions are 
similar to the safeguard measures imposed at the end of 2006 on pipes of larger diameter (a special duty 
of  8%  was  introduced  then),  this  would  introduce  a  further  structural  difference  as  compared  to  the 
Community. 

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is because prevailing prices for importers which maintain a significant presence in the 
Community  are  likely  to  be  at  the  same  level  as  those  of  Russian  export  prices  and 
because  of  the  homogeneous  nature  of  the  product  concerned,  which  implies  that 
exporters wishing to make inroads in the Community would, in all likelihood, need to 
align themselves to the level of prices of the lowest bidders.  

(189)  The foregoing points to dissimilarities which would affect price formation and hence 
levels, and which therefore imply that Russian prices may not be used for the purpose 
of establishing a new level of measures.  

(190)  The Commission further examined whether export prices to third countries other than 
Russia could be used for this purpose. It was first examined whether the second largest 
market in terms of exports could be taken as a reference country. However, this option 
was disregarded, as Belarus is not a market economy country. Sales to other countries 
were  also  analysed  but  their  exports  volumes  were  too  small  to  be  considered  as 
representative.  

(191)  In these circumstances, the use of export prices from Ukraine to Russia (and to other 
third  countries  where  the  applicant  exported  during  the  IIP)  cannot  be  considered  as 
representative of the likely export price behaviour to the Community and are therefore 
disregarded. In view of the above, it was instead considered necessary to apply Article 
2(9) of the basic Regulation for the Interpipe Group. In this respect, it was considered 
whether the weighted average of the CIF export prices to the Community during the IP 
from  all  the  co-operating  exporting  producers  in  all  countries  concerned  by  the 
investigation,  could  be  aggregated  on  a  per  PCN  basis  and  used  as  a  reference  to 
establish an export price for the Ukrainian exporting producer. 

(192)  This method was found to be appropriate since it is reasonable to presume that should 
Ukrainian  exports  enter  the  Community  market,  they  would  not  deviate  to  any 
significant  extent  from  the  price  pattern  of  their  direct  competitors,  i.e.  the  other 
exporters to the Community. 

(193)  As explained in recital (181), when establishing the export price, the Commission only 

used the data from the six overlapping months of the IP and IIP. 

(194)  The matching PCN unit export prices of these exporters were thus used to establish the 

export price of the Interpipe group.  

(195)  Following  the  disclosure,  the  sole  Ukrainian  exporting  producer  claimed  that  when 
determining the export price, no deduction should be made for the related company’s 
SG&A  and  profit,  as  Article  2(9)  of  the  basic  Regulation  is  not  applicable  in  the 
present  case.  It  was  argued  that  Article  2(9)  of  the  basic  Regulation  only  applies  to 
related  importers  located  in  the  Community  as  its  wording  makes  a  clear  distinction 
between ‘importation and resale’. It was further argued that the related company acts 
as an export department. 

(196)  It should be noted that, for sales of the product concerned to the Community, the sole 
Ukrainian  exporting  producer  consigned  the  product  concerned  directly  to  the 
Community,  invoiced  its  related  company  in  Switzerland  for  each  consignment  and 
received  payment  accordingly.  Thus,  the  exporting  producer  performed  all  functions 
of  an  exporter.  The  related  company  in  Switzerland  negotiated  sales  contracts  and 

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38 

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invoiced  the  first  independent  buyer  in  the  Community.  The  related  company  also 
arranged the delivery of the products sold.  

(197)  Concerning the disclosure comments made by the Ukrainian company, it is held that 
export  prices  may  be  constructed  under  Article  2(9)  of  the  basic  Regulation  where 
there  is  no  export  price  (first  option  under  article  2(9)).  Again  under  Article  2(9), 
export prices can be constructed on any reasonable basis. Such reasonable basis will 
also  cater  for  a  deduction  of  the  related  company's  SG&A  and  a  reasonable  profit. 
Even  if  it  was  considered  that  these  elements  are  more  appropriately  reflected  as 
"commissions"/"mark-ups" in accordance with Article 2(10)(i) of the basic Regulation, 
quod  non,  the  resulting  dumping  margin  would  be  the  same..  Since  the  profit  of  the 
related  company  was  affected  by  the  fact  that  it  purchased  under  inter-company 
conditions, a reasonable profit was therefore determined on the basis of data gathered 
from independent importers/traders co-operating with the investigation. 

(198)  Following disclosure, the Community industry claimed that the Basic Regulation and 
WTO law do not allow the calculation of dumping margins when there are no exports 
made to the Community. For the reasons stated in the previous recitals, it is reiterated 
that  Article  2(9)  of  the  basic  Regulation  explicitly  mentions  that  when  there  is  no 
export  price,  such  price  may  be  constructed  on  any  reasonable  basis.  Consequently, 
the claim is rejected. 

5.4. 

Dumping margin 

(199)  The  comparison  between  the  normal  value  calculated  as  described  above  and  the 
export price also calculated as described above, showed the existence of dumping. The 
dumping margin for the Ukrainian group expressed as a percentage of the CIF import 
price at the Community border, duty unpaid, is the following: 

Interpipe  Group  (OJSC  Interpipe  Novomoskovsk  Pipe  Production  Plant  and  OJSC 
Interpipe Nizhnedneprovsk tube rolling plant): 10.7%.  

5.5. 

Conclusions on dumping regarding Ukraine 

(200)  In  conclusion,  dumping  by  the  Interpipe  Group  was  found  to  exist  at  the  level 
described in recital (199). As regards all other exporting producers in the Ukraine, the 
applicable residual dumping margin will not change. 

6. 

UKRAINE (ii): ARTICLE 11(2) ASPECTS  

6.1. 

Preliminary remarks 

(201)  The exported volumes from the country concerned to the EU have steadily decreased 

from 29 KT in 2002 to 17.2 KT in 2005 to nearly nil in the IP. 

(202)  Only  two  Ukrainian  producers  belonging  to  the  same  group  (the  Interpipe  Group) 
made  themselves  known  and  submitted  a  questionnaire  reply,  OJSC  Interpipe 
Novomoskovsk  Pipe  Production  Plant  and  OJSC  Interpipe  Nizhnedneprovsk  Tube 
Rolling Plant.  

(203)  It was established that there were at least another 7 producers operating in Ukraine. On 
the basis of the information available to the Commission, the Interpipe Group accounts 

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for around 26% of the Ukrainian production. Under these conditions, it is considered 
that the level of co-operation was very low.  

6.2. 

Dumping of imports during the investigation period 

(204)  The  single  cooperating  Ukrainian  group  producer  had  negligible  exports  to  the 
Community  during  the  IP.  The  very  low  level  of  Ukrainian  exports  of  the  product 
concerned to the Community was not representative and thus did not provide a reliable 
and meaningful basis for establishing whether there was a continuation of dumping. It 
was therefore considered appropriate to base the analysis in this case on the likelihood 
of recurrence of dumping should measures be terminated. 

6.3. 

Development of imports should measures be repealed 

6.3.1.  Preliminary remarks 

(205)  As  outlined  in  recital  (203),  the  investigation  has  shown  that  there  were  at  least  7 
producers  of  the  product  concerned  in  Ukraine  during  the  IP  and  only  one  group 
cooperated in the investigation.  

(206)  It was examined to what extent data from the one cooperating Ukrainian group could 
be  used  for  the  purpose  of  analysing  the  overall  development  of  likely  exports  from 
Ukraine as well as, more specifically, to serve as a benchmark in terms of indicators of 
domestic and export prices, costs, production capacities and capacity utilisation. 

(207)  The information pertaining to stocks, production level and capacity that was provided 
by the company has been used in conjunction with data from the complaint in order to 
establish the production volume and capacity of Ukrainian producers.  

(208)  In  view  of  the  above,  the  following  considerations  were  taken  into  account  when 

assessing the likely impact should measures be repealed. 

6.3.2.  Production, unused capacities and likelihood that these capacities would be directed 

to the Community.  

(209)  Based  on  the  information  available  to  the  Commission,  it  was  established  that 
production capacity of the product concerned in the Ukraine exceeds 400 KT per year.  

(210)  In the absence of evidence showing that this capacity could be absorbed by increased 
domestic sales, sales to other third countries or the production of products other than 
the  product  concerned,  it  is  concluded  that  should  measures  expire,  significant  spare 
capacities  would  in  all  likelihood  be  directed  towards  the  Community,  not  least 
because  of  the  Community's  attractiveness  as  an  export  market.  This  is  further 
confirmed by the significant spare capacity existing at the Interpipe Group. 

(211)  Considering  that  the  Community  market  is  one  of  the  biggest  in  the  world,  its  sheer 
size makes it attractive to any Ukrainian exporting producer of the product concerned.  

(212)  It is recalled that the Interpipe Group supplies coils from Ukraine to the manufacturing 
company  Mogilev  in  Belarus,  which  transforms  the  product  on  a  toll  manufacturing 
basis into the product concerned, which is then sold by Interpipe's Swiss subsidiary to 
the  Community.  Throughout  the  process,  Interpipe  maintains  ownership  of  the 

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40 

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product. As mentioned above, these exports have been found to be dumped. Especially 
since it is proposed to impose measures on Belarus, it cannot be excluded that certain 
exports made by the group from Belarus would be sourced instead from Ukraine. 

(213)  Taken together with the relatively attractive price level in the Community, where well 
developed distribution channels exist, it is considered that, in the absence of measures, 
there  would  be  a  clear  economic  incentive  for  a  shift  of  exports  away  from  third 
markets such as Russia or Belarus and towards the Community. 

(214)  Overall,  under  these  circumstances,  it  is  considered  that  any  increase  in  the  current 
capacity  utilisation  is  likely  to  be  directed  towards  exports,  and  specifically  to  the 
Community market. 

6.3.3.  Likely price levels 

(215)  In  a  context  of  low  cooperation  and  of  the  information  mentioned  above,  it  is 
considered that the allegations made in the complaint as to likelihood of recurrence of 
dumping should be confirmed. This is further supported by additional factors. 

(216)  The export prices to other third countries are at the same level as that of the prevailing 
import prices in the Community. This would imply that it is likely that export prices to 
such  other  third  countries  are  also  dumped,  pointing  to  a  more  general  pattern  of 
behaviour based on dumping.  

(217)  In  addition  for  the  product  under  consideration,  which  is  in  general  rather 
homogeneous, would-be Ukrainian sellers would be likely to provide products at the 
prevailing  prices  of  other  imports  in  the  Community.  As  has  been  concluded  in  the 
sections above, the import prices of other exporting countries are generally low. When 
considering  that  potential  export  prices  of  Ukrainian  producing  exports  are  likely  to 
have to mirror these low prices and when considering the cost structure of the product 
concerned,  which  is  heavily  based  on  steel  coil  and  zinc  prices  that  have  seen 
significant increases across the world, it would be likely that export prices would be 
dumped at around 10.7% as concluded in recital (199). 

6.4. 

Conclusion 

(218)  A significant amount of Ukrainian exports would therefore be likely to be sold in the 

Community at dumped prices should measures be allowed to lapse. 

E. INJURY ASPECTS (Anti-dumping investigation, Expiry review, Turkey interim 
review) 

1. 

Definition of the Community Industry and Community Production 

(219)  Within  the  Community,  it  was  found  that  the  like  product  was  manufactured  by  17 
companies which cooperated with the investigation and supported the complaint and 2 
Community  producers  that  did  not  cooperate  with  the  investigation.  No  Community 
producer came forward and opposed the investigation.  

(220)  In the  absence of  the cooperation  of 2 producers in the Community, the Community 
production  was  established  on  information  submitted  in  the  complaint  and  the 
information collected during the investigation from the co-operating producers.  

EN 

41 

   EN 

 
(221)  The 17 co-operating Community producers accounted for 95% of the total production 
in  the  Community  of  the  product  concerned.  They  were  deemed  to  constitute  the 
Community industry within the meaning of Article 4(1) of the basic Regulation.  

(222)  The sampled Community producers in the investigation accounted for around 67% of 
the production of the like product of the Community industry during the investigation 
period. 

2. 

Community consumption 

(223)  The consumption of the product concerned on the Community market was established 
on the basis of the volume of sales on the Community market of all producers within 
the Community plus imports from the countries concerned as well as third countries. 

(224)  In respect of the Community producers, the sales volumes were ascertained by using 
the  information  from  the  responses  of  the  Community  industry  together  with  the 
information  available  in  the  complaint  for  the  Community  sales  of  the  two  non-
cooperating producers.  

(225)  As  to  the  volumes  of  imports  from  countries  concerned  and  third  countries,  the 

following sources of information were examined: 

– 

– 

– 

Full CN code data from Eurostat. 

Other  statistical  information  of  a  confidential  nature  available  to  the 
Commission. 

Information on imports available from interested parties. 

(226)  In addition, according to the complaint, no deduction should be made to the CN Code 
data, to cover products which were not the product concerned because no significant 
quantities of other products have been imported under these CN codes 

(227)  On this basis, it was concluded that, for the purposes of establishing volume and price 
trends  for  the  whole  period  under  consideration,  full  CN  Codes  were  the  most 
adequate source.  

(228)  The  following  comments  are  useful  in  this  context.  For  Belarus,  in  the  absence  of 
other  information  regarding  prices  and  covering  the  full  period  under  consideration 
and  after  analysing  the  price  levels  emanating  from  Eurostat  and  those  from  the 
German operator mentioned above, it is considered that Eurostat statistics are the most 
accurate source for the trends in prices.  

(229)  For  China  the  investigation  established  that  imports  to  the  EU  market  from  the 
cooperating exporting producers were higher than the import statistics as mentioned in 
table 2 (below). Given that price levels were similar between the two sets of data, and 
in  order  to  ensure  that  the  figures  are  not  overstated,  it  was  decided  that  official 
statistics would be used, not least because this approach had no material impact on the 
analysis of injury and causation, when compared to using the data obtained from the 
cooperating exporting producers.  

EN 

42 

   EN 

 
(230)  Considering  that  Turkish  imports  from  the  co-operating  exporters  were  higher  than 
shown  by  Eurostat  data,  a  similar  reasoning  applies  to  Turkey.  Again,  this  approach 
had  no  material  impact  on  the  analysis  of  injury  and  causation,  when  compared  to 
using the data obtained from the cooperating exporting producers. 

(231)  The consumption established as outlined above ('Community consumption') increased 
by  9%  during  the  period  under  consideration,  i.e.  from  1.234KT  tonnes  in  2004  to 
1.342KT tonnes during the IP. More specifically, the Community consumption shows 
a  decrease  by  12%  in  2005  before  increasing  again  in  2006  and  during  the  IP.  The 
drop  in  consumption  for  the  year  2005  is  attributable  to  destocking  (and  therefore 
decreased purchasing) by the stockists in 2005 after increased purchases in 2004. 

Table 1 

2004 

2005 

2006 

IP 

EU Consumption (Tonnes) 

1 234 037 

1 082 125 

1 282 737 

1 342 657 

Index 

100 

88 

104 

109 

3. 

Imports from the countries concerned and from the third countries. 

(232)  For  the  anti-dumping  investigation  countries  i.e.,  Belarus,  the  People's  Republic  of 
China and Russia it was examined whether the conditions were such so as to allow for 
an analysis of all imports to be cumulated. With below de minimis dumping, exports 
from Bosnia_Herzegovina were instead considered under other exports in section 3.4 
as well as under other causes below in section 4. The imports from the expiry review 
countries and from Turkey (in the context of the Turkey interim review) were analysed 
separately. In this context it is recalled that dumping levels for Turkey were below the 
de minimis threshold and that the imports volumes as concern Thailand and Ukraine 
together and separately also were de minimis. However, for the latter two countries a 
likelihood of recurrence of injurious dumping has been found, as is set out in section F 
below. 

3.1. 

Cumulation 

(233)  The  Commission  examined  whether  dumped  imports  of  the  product  concerned 
originating in Belarus, the People's Republic of China and Russia, should be assessed 
cumulatively in accordance with Article 3(4) of the basic Regulation.  

(234)  This  Article  provides  that  the  effects  of  imports  from  two  or  more  countries 
simultaneously subject to the same investigation shall be cumulatively assessed when 
(i)  the  margin  of  dumping  established  in  relation  to  the  imports  of  each  country  is 
more  than  de  minimis  as  defined  in  Article  9(3)  of  the  basic  Regulation;  (ii)  the 
volume  of  imports  of  each  country  is  not  negligible;  and  (iii)  the  conditions  of 
competition between the imported products and the condition of competition between 
the  imported  products  and  the  like  products  in  the  Community  makes  such  an 
assessment appropriate. 

3.1.1.  Margin of dumping 

EN 

43 

   EN 

 
 
(235)  All  imports  from  the  PRC,  Russia  and  Belarus  meet  requirement  (i)  mentioned  in 

recital (234) above.  

3.1.2.  Volume of dumped imports 

(236)  The volumes of imports from the PRC, Russia and Belarus are more than de minimis 

and therefore not negligible (as can be seen in table 2 below). 

3.1.3.  Conditions of competition 

(237)  As  regards  the  conditions  of  competition,  the  investigation  showed  that  the  product 
concerned  imported  at  dumped  prices  from  the  countries  concerned  and  the  product 
produced and sold by the Community industry were alike in all their essential physical 
and  technical  characteristics.  The  same  applies  for  a  comparison  of  the  dumped 
imported products from the various countries concerned. 

(238)  Furthermore,  on  that  basis,  these  products  are  interchangeable  and  were  marketed  in 
the  Community  during  the  period  under  consideration  through  comparable  sales 
channels, e.g. stockists and traders.  

(239)  In  addition,  the  investigation  established  that  competition  took  place  throughout  the 
various  Member  States  of  the  Community  and  across  all  the  various  types  of  the 
product concerned including galvanised products, black products and tubes with other 
outer finishing. Therefore, the imports of the welded tubes were considered to compete 
with each other and with the ones produced in the Community.  

(240)  The  pricing  behaviour  of  the  various  cumulated  countries  was  also  examined.  This 
analysis showed that these countries were undercutting and underselling the prices of 
the  Community  industry  and,  as  shown  at  recital  (244),  the  prices  followed  similar 
trends. 

(241)  Certain parties argued that imports originating in Russia should be decumulated from 
the  investigation  as  imports  from  this  country  show  a  diverging  trend  in  import 
volumes and market share in a market where demand is increasing. In this respect, it 
should  be  noted  that  the  volumes  of  imports  into  the  Community  market  remained 
substantial at all times throughout the period under consideration. In addition, dumped 
imports from all three countries (Belarus, the People's Republic of China and Russia) 
increased  significantly  in  the  last  two  years  which  were  analysed,  and  general  price 
levels followed the same trends and were in the same order of magnitude, particularly 
in  the  IP  as  shown  by  individual  company  data.  Furthermore  all  of  the  cumulated 
imports undercut the prices of the Community industry in the IP. 

(242)  On the basis of the above, it was concluded that all conditions justifying cumulation as 
described  in  Article  3(4)  of  the  basic  Regulation  were  met.  It  has  therefore  been 
decided that imports of welded tubes originating in Belarus, the People's Republic of 
China  and  Russia  should  be  assessed  cumulatively.  These  countries  will  be  jointly 
referred  to  as  the  'cumulated  countries'  and  the  imports  from  these  countries  will  be 
jointly referred to as 'cumulated imports'. 

EN 

Table 2 

44 

   EN 

 
Imports volumes (tonnes) 

2004 

2005 

2006 

IP 

China 

Russia 

Belarus 

21 781 

54 120 

110 922 

184 887 

42 036 

30 124 

34 148 

36 057 

12 827 

22 056 

28 191 

29 615 

Total cumulated imports 

76.644 

106.300 

173.261 

250.559 

Ukraine 

Thailand 

25 173 

17 210 

4 501 

2 753 

90 

0 

0 

0 

Other imports 

222.096 

162.177 

238.150 

238.441 

Of which Bosnia – 

Herzegovina 

6 836 

11 011 

30 032 

33 095 

Of which Turkey 

95.049 

85.018 

99.843 

110.994 

TOTAL IMPORTS 

324 003 

285 687 

415 912 

491 753 

Table 3 

Market Share (%) 

2004 

2005 

2006 

IP 

Belarus 

China 

Russia 

1,0% 

2,0% 

2,2% 

2,2% 

1,8% 

5,0% 

8,6% 

13,8% 

3,4% 

2,8% 

2,7% 

2,7% 

Cumulated imports 

6,2% 

9,8% 

13,5% 

18,7% 

Ukraine 

Thailand 

2,0% 

1,6% 

0,4% 

0,2% 

0,0% 

0,0% 

0,0% 

0,0% 

Other imports 

18,0% 

15,0% 

18,6% 

17,8% 

Of which Bosnia – 
Herzegovina 

0,6% 

1,0% 

2,3% 

2,5% 

EN 

45 

   EN 

 
Of which Turkey 

7,7% 

7,9% 

7,8% 

8,3% 

TOTAL IMPORTS 

26,3% 

26,4% 

32,4% 

36,6% 

3.2. 

Cumulated volume and market share 

(243)  The cumulated imports have increased from 76.644 tonnes in 2004 to 250.559 tonnes 
during  the  IP,  i.e.  by  more  than  200%.  Since  the  consumption  of  the  product 
concerned  during  the  period  under  consideration  has  increased  by  9%,  the  market 
share  held  by  cumulated  imports  of  the  product  concerned  increased  from  6,2%  in 
2004  to  18,7%  in  the  IP.  The  developments  of  imports  and  market  shares  of  the 
product concerned during the period under consideration are shown in tables 2 and 3 
above.  

3.3. 

Prices and Undercutting 

3.3.1.  Evolution of prices for anti-dumping investigation countries 

(244)  The  weighted  average  price  of  imports  from  the  countries  concerned  developed  as 

follows over the period under consideration: 

Table 4 

Import prices (EUR/T) 

2004 

2005 

2006 

China 

Russia 

Belarus 

460 

481 

456 

537 

543 

495 

520 

551 

503 

IP 

557 

603 

549 

(245)  Table  4  was  sourced  from  the  Comext  database  at  full  CN  Code  level.  The  general 
trend  of  the  import  prices  into  the  Community  shows  an  increase  in  line  with  the 
general increase of prices for all operators on the EU market. 

3.3.2.  Price undercutting for the anti-dumping investigation countries 

(246)  For the determination of the price undercutting, the Commission based its analysis on 
the  information  submitted  at  a  detailed  product  type  level  in  the  course  of  the 
investigation by the sampled exporting producers for China. For Russia, the data of the 
cooperating  exporting  producer  was  used.  For  Belarus,  data  from  the  cooperating 
German operator was used. 

(247)  This  export  price  data  was  compared  to  a  weighted  average  price  of  the  sampled 
Community producers at the same detailed product type level in order to ensure a fair 
comparison  at  the  same  level  of  trade.  In  all  cases  this  analysis  took  into  account 
actual export prices of the exporting producers at CIF Community frontier level. For 
the  Community  industry  side,  the  relevant  sales  prices  were  those  to  independent 
customers,  adjusted  when  necessary  to  ex-works  level.  During  the  IP,  based  on  the 

EN 

46 

   EN 

 
different product types defined in the questionnaire, the average undercutting margins 
were as follows: 

Table 5 

Undercutting 

China 

TMK Russia 

OMK Russia 

Belarus 

IP 

43% 

12% 

15% 

22% 

3.3.3.  Evolution of prices and price undercutting for the expiry review  

(248)  For  Ukraine  and  Thailand,  it  is  recalled  that  the  volumes  of  imports  were  below  de 
minimis and it was thus considered that the prices, and hence the price evolution and 
the undercutting calculations, would not be reliable and meaningful. 

3.4. 

Imports from other third countries 

3.4.1. 

Import volume and market share in the review 

(249)  As shown in tables 2 and 3, imports from third countries including those from Bosnia-
Herzegovina  and  from  Turkey  slightly  increased  from  222.096  tonnes  in  2004  to 
238.441  tonnes  during  the  IP.  The  market  share  held  by  these  imports  remained  at 
around 18% over this period. 

4. 

Situation of the Community Industry 

(250)  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. This analysis was carried out for the nine sampled companies as mentioned 
in recital (20) which had completed full questionnaires. The factors examined for the 
sampled  companies 
investments, 
profitability, return on investment, cash flow and ability to raise capital. However, for 
some  indicators  (analysed  below  as  macro  indicators)  information  was  available  and 
used for all 17 companies (including the nine sampled companies) of the Community 
industry. These macro indicators were market share, sales volume in the, Community 
production and production capacity. 

included  prices,  employment  and  wages, 

4.1. 

Macro indicators 

4.1.1.  Production, production capacity and capacity utilisation 

(251)  The  production  of  the  Community  industry  decreased  by  10%  from  2004  to  the  IP. 
The production capacity was calculated according to a standard methodology applied 
to  the  whole  Community  industry.  This  methodology  took  into  account  the  actual 
capacity  over  the  long  term  by  allowing  for  normal  production  stoppages  such  as 

EN 

47 

   EN 

 
maintenance  and  it  was  also  the  methodology  normally  employed  within  the 
Community  industry.  The  production  capacity  for  the  product  concerned  decreased 
moderately  during  the  period  under  consideration,  from  2.218.597  tonnes  in  2004  to 
2.132.322 (or by 4%) during the IP.  

(252)  The capacity utilisation also declined, mirroring a decline in production, from around 
44% to 41% over the period under consideration. In this respect it should however be 
noted that this factor is not the most relevant injury indicator in this sector, as plants 
and production equipment are also used to manufacture other tubes and other products 
that are not subject to this investigation. 

Table 6 

Community Industry 

2004 

2005 

2006 

IP 

Production 

capacity 

(tonnes) 

Production 

volume 

(tonnes) 

Index 

of 

production 

volume (%) 

2 218 597 

2 211 597 

2 136 747 

2 132 322 

970 080 

832 973 

914 663 

875 477 

100 

85,9 

94,3 

90,2 

Capacity utilisation (%) 

43,7 

37,7 

42,8 

41,1 

4.1.2.  Sales volume and market share 

(253)  The data in table 7 show a clear decrease in sales volume for the Community industry 
on  the  Community  market.  This  situation  is  further  emphasised  by  the  fact  that  the 
overall  consumption,  as  shown  in  Table  1,  increased  by  9  %  over  the  same  period. 
After a certain degree of stability was maintained in 2004 and 2005, the market share 
of  the  Community  industry  dropped  significantly  in  2006  and  the  IP.  This  is  in 
contrast to constant or increasing market shares (see recital (243)) for dumped imports 
from the PRC, Belarus and Russia individually and an increasing market share of the 
cumulated countries throughout the period under consideration. 

Table 7 

Community Industry 

2004 

2005 

2006 

IP 

Sales (tonnes) 

901 934 

788 338 

858 725 

842 804 

Market share (%) 

73,1 

72,9 

66,9 

62,8 

4.2. 

Micro indicators 

4.2.1.  Stocks 

EN 

48 

   EN 

 
(254)  The stock level of the sampled Community producers dropped by 23% between 2004 
and 2005 and then was constant thereafter. A calculation of the stock rotation through 
the period under consideration showed that the stock level remained at around 30 days 
of sales. The investigation has confirmed that the level of stocks is not considered as a 
significant  indicator  in  this  respect  as  the  Community  industry  usually  works  on  a 
production to order basis and thereby holds relatively little stock. 

Table 8 

2004 

2005 

2006 

IP 

Stocks (tonnes) 

63 632 

49 074 

48 716 

49 008 

Index (%) 

Stock rotation (days) 

100 

35 

77,1 

31 

76,6 

29 

77,0 

30 

4.2.2.  Sales prices 

(255)  The average unit selling price to unrelated customers in the Community increased by 
14,8% during the period under consideration. This increasing trend must however be 
seen in the context of a significant increase of the cost of production during the same 
period. The increase in the cost of production was mainly due to a substantial increase 
in  the  purchase  price  of  the  major  raw  materials  i.e.  coils,  zinc,  and  energy  -  as 
explained  in  recital  (287).  In  general  terms,  there  was  no  substantial  change  in  the 
product mix over the period under consideration which would distort the trend in sales 
prices shown below in table 9. 

Table 9 

2004 

2005 

2006 

691 

711 

IP 

758 

104,7 

107,7 

114,8 

Sales prices in EUR/MT 

Index (%) 

660 

100 

(256)  The increase of the cost of production during the period under consideration was not 
matched by a corresponding increase of the sales price; this was mainly the result of 
strong  pressure  by  imports  from  the  countries  concerned.  Under  these  circumstances 
the  Community  industry  was  unable  to  pass  on  the  increase  in  price  of  the  raw 
material to its customers. 

(257)  The Community industry prices were thus suppressed, even if prices saw an increase 
in absolute terms. In other words, the price increase would have been much greater in 
the absence of the dumped imports. 

(258)  Moreover,  the  sales  prices  on  the  Community  market  were  undercut  by  between 

around 12% and 43% as explained in recital (246) and subsequent. 

4.2.3.  Profitability 

EN 

49 

   EN 

 
 
 
(259)  The overall profitability of the sampled producers in respect of the product concerned 
is based on the weighted average profitability on net turnover of the product concerned 
sold to unrelated customers on the EU market. During the period under consideration 
the profitability level deteriorated, reaching -1.0% during the IP. In addition, the level 
of profitability was clearly insufficient throughout the period under consideration and, 
bearing  in  mind  that  this  situation  has  continued  over  many  years,  it  evidently 
jeopardizes the very existence of at least part of this industry. 

(260)  The profitability level never reached the target profit of 5% mentioned in recital (352) 

and subsequent. 

Table 10 

Profitability (%) 

2004 

2005 

2006 

Profit / Net turnover 

0,9 

-2,6 

-1,9 

IP 

-1,0 

4.2.4.  Employment, productivity and wages 

(261)  Employment  of  the  sampled  Community  producers  decreased  by  23,5%  during  the 
period under consideration from 2.772 workers in 2004 to 2.123 during the IP. 

(262)  The wages calculated by taking the average cost per employee have increased from 15 
668 EUR in 2004 to 21 558 EUR during the IP. One major reason for this increase in 
wages  per  employee  is  explained  by  the  strong  salary  increase  in  the  Community 
industry companies situated in the 10 countries which became members of the EC in 
2004. 

(263)  This  increase  is  however  more  than  compensated  by  the  combined  effect  of  the 
aforementioned decrease in labour and the significant increase (17%) in productivity. 
This underlines the continuing efforts by Community industry to increase efficiency. 

Table 11 

Employment 

2004 

2005 

2006 

IP 

Number of employees 

2 772 

2 350 

2 179 

2 123 

Index (%) 

100 

84,7 

78,6 

76,5 

Wage  cost  per  employee 
(EUR) 

Index (%) 

Production per employee 

Index (%) 

15 668 

17 836 

20 945 

21 558 

113,8 

133,7 

137,6 

238 

100 

283 

119 

278 

117 

100 

238 

100 

50 

   EN 

EN 

 
4.2.5. 

Investments, return on investment  

(264)  The  investigation  confirmed  that  no  important  capital  expenditure  in  relation  to  the 
companies'  overall  activity  was  undertaken  by  the  sampled  Community  producers  in 
the business involving the product concerned. No investments were done to increase 
the production capacity as demonstrated in recitals (251) and (252). Under the current 
market  conditions,  the  Community  industry  did  not  invest  in  an  increase  in  capacity 
but instead took steps to maintain and enhance the efficiency of its existing production 
equipment. Some investments in the welded tubes-related activity were also made with 
regard to environmental and health and safety matters. 

(265)  The level of the return on investment expressed as the relation between the net profit 
of  the  sampled  Community  producers  and  the  gross  book  value  of  its  fixed  assets 
mirrors  the  profitability  trend  as  explained  in  recital  (259).  Its  level  is  very  low  and 
remains negative as from the year 2005. 

Table 12 

2004 

2005 

2006 

IP 

Investment  

14.880.328 

14.939.859 

11.600.607 

10.548.216 

Return on Investment (%) 

1,4% 

-3,5% 

-2,7% 

-1,8% 

4.2.6.  Cash flow and ability to raise capital 

(266)  The development of the cash flow generated by the sampled Community producers in 
relation to sales of the product concerned on the EU market mirrored the development 
of  the  profitability.  It  is  worth  noting  that  while  the  cash  flow  is  low,  it  remained 
positive  during  the  period  under  consideration  with  the  exception  of  the  year  2005 
where it was only just negative. 

(267)  The  investigation  has  not  detected  that  the  Community  industry  was  experiencing 
difficulties in its ability to raise capital. It should, however, be noted that the ability to 
raise capital may be considered a less meaningful indicator for this investigation. This 
is because most of the producers of the product concerned of the Community industry 
are  part  of  large  corporate  groups.  Therefore,  the  ability  to  raise  capital  is  closely 
linked  to  the  performance  of  the  group  as  a  whole  rather  than  the  individual 
performance  of  the  product  concerned.  However  the  fact  that  none  of  these  large 
groups made decisions to invest in new production facilities shows that in recent years 
the return on such investments has not been adequate 

Table 13 

2004 

2005 

2006 

IP 

Cash flow (% of turnover) 

5,5% 

-0,4% 

1,0% 

1,6% 

4.2.7.  Growth 

EN 

51 

   EN 

 
 
 
(268)  As  explained  in  recital  (253),  it  has  to  be  noted  that  the  market  share  of  the 
Community industry fell by 10.3 percentage points while the level of the Community 
consumption  increased  by  9%.  This  indicates  clearly  that  the  Community  producers 
have not been able to grow sufficiently in the market conditions observed in the period 
under consideration. 

4.2.8.  Magnitude of the dumping margin in the context of the anti-dumping investigation 

(269)  As concerns the substantial margin of dumping found during the IP for imports from 
the  PRC,  for  Russia  and  for  Belarus  and  given  the  volume  and  prices  on  imports 
involved,  the  impact  of  the  magnitude  of  dumping  margin  cannot  be  considered  as 
negligible. 

4.2.9.  Magnitude of the dumping margin in the context of the expiry review 

(270)  For  Ukraine  and  Thailand  it  is  recalled  that  the  exports  in  the  IP  were  below  de 
minimis and were thus not considered a reliable and meaningful basis for establishing 
a dumping margin. It is therefore considered appropriate to base the assessment on the 
likelihood of recurrence of injurious dumping, as set out in section F below. 

4.2.10.  Recovery from the effects of past dumping 

(271)  The  expected  recovery  of  the  Community  industry  from  the  effects  of  past  dumping 
has  not  entirely  materialised  as  shown  by  the  low  profitability  and  certain  of  the 
inability to significantly raise sales volumes, together with a significant loss of market 
share. The industry has in recent years been faced with substantial volumes of dumped 
imports  from  the  PRC,  Russia,  and  Belarus,  which  has  hampered  its  expected 
recovery. 

4.3. 

Conclusion on injury 

(272)  Both  individually  and  taken  together,  import  volumes  from  the  cumulated  countries 
(as defined in recital (242)) have maintained a significant presence in the Community 
market  throughout  the  period  under  consideration.  Since  2005,  they  have  even 
increased  considerably  both  in  absolute  and  relative  terms.  Together,  their  market 
share  increased  from  around  6%  in  the  year  2004  to  around.  10%  in  2005  and  from 
that level to around 19% in the IP as explained in recital (243). Moreover the dumped 
imports  from  these  countries  show  individually  a  significant  level  of  price 
undercutting.  Underselling  margins  are  substantial,  reflecting  the  fact  that  the 
Community industry is incurring losses.  

(273)  Community  industry  indicators  have  shown  an  overall  negative  evolution  during  the 
period under consideration and have demonstrated that material injury has taken place. 
In this context seemingly positive developments, such as the increase in sales prices, 
must  be  compared  to  the  more  significant  increase  of  the  costs  of  the  major  raw 
materials / components which have outweighed such positive trends. 

(274)  Based  on  the  foregoing  analysis,  it  appears  that  the  Community  industry  is  in  a 
difficult economic and  financial  situation and has suffered material injury within the 
meaning of the Article 3 of the basic Regulation. This conclusion can be applied to the 
Community  industry  as  a  whole,  given  the  high  level  of  representativeness  of  the 

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sampled  Community  producers  and  the  fact  that  the  macro  indicators  were  analysed 
for all the companies of the Community industry as explained in recital (250) above. 

5. 

Causation 

5.1. 

Introduction 

(275)  In  accordance  with  Article  3(6)  and  (7)  of  the  basic  Regulation  it  was  examined 
whether the material injury suffered by the Community industry had been caused by 
the dumped imports from the countries concerned. Furthermore, known factors other 
than  the  dumped  imports,  which  might  have  injured  the  Community  industry  were 
examined  to  ensure  that  any  injury  caused  by  those  factors  was  not  attributed  to  the 
dumped imports. 

5.2. 

Effect of the dumped imports from the cumulated countries 

(276)  As  explained  above,  imports  from  the  cumulated  countries  have  increased  by  more 
than 200% during the period under consideration. In terms of market share; the share 
of cumulated countries has increased from 6,2% to 18,7%. In addition, there is a clear 
coincidence  in  time  between  the  deterioration  of  the  situation  of  the  Community 
industry and the important increase of dumped imports from the cumulated countries. 
Although Table 4 shows that prices of imports originating in the cumulated countries 
have  increased  over  the  period  under  consideration,  this  should  be  viewed  in  the 
context  of  the  equivalent  general  price  increase  on  the  Community  market  as 
explained in recital (255). 

Table 14 

Imports volume 

2004 

2005 

2006 

IP 

Cumulated countries 

(Tonnes) 

76.644 

106.300 

173.261 

250.559 

Market share 

6,2% 

9,8% 

13,5% 

18,7% 

(277)  Imports  from  the  cumulated  countries  have  increased  their  penetration  of  the  EU 
market and have taken over significant market shares previously held by countries that 
are subject to the expiry review (with the exception of Turkey) as well as those from 
third countries not subject to the investigation and the Community industry. In fact the 
Community  industry  lost  over  10  percentage  points  of  market  share  over  the  period 
under consideration. It was during this same period  that  imports from  the cumulated 
countries gained over 10 percentage points as shown at Table 14 above.  

(278)  This  penetration  was  possible  because  these  imports  were  made  at  very  low  prices. 
Imports  from  cumulated  countries  have  undercut  those  of  the  Community  producers 
by substantial amount as shown in recital (247). 

(279)  The  impact  of  the  dumped  imports  from  the  cumulated  countries  is  the  injurious 
situation  described  above  at  section  4  whereby  a  downward  pressure  on  prices  has 
resulted in the Community industry not achieving adequate levels of profitability and 

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even losses. In addition, negative trends were identified for many other injury factors 
such as production, employment and market share. As seen above in recital 273 there 
was  also  a  clear  coincidence  in  time  between  the  increase  in  imports  from  the 
cumulated countries and the negative trends seen in the injury indicators. 

5.3. 

Effect of imports from other sources 

5.3.1.  Bosnia-Herzegovina 

(280)  Imports  from  Bosnia-Herzegovina  totalled  around  33  000  tonnes  or  2.5%  of  the 
Community  consumption  on  the  Community  market.  The  average  import  price  was 
576  EUR  per  tonne  giving  an  indication  that  they  have  undercut  the  prices  of  the 
Community  industry.  Nevertheless,  bearing  in  mind  the  volumes  involved,  it  was 
concluded that only a small part of the injury can be attributed to these imports, and 
that this does not break the causal link between the injury suffered by the Community 
industry and the dumped imports from the cumulated countries.  

5.3.2.  Turkey 

(281)  These imports totalled around 111.000 tonnes or 8,3% of the Community consumption 
on the Community market during the IP. The average import price was 620 EUR per 
tonne which undercut the prices of the Community industry. Nevertheless, as can be 
seen from Table 4, the Turkish prices were higher than those of the three cumulated 
countries. The difference in price becomes even further pronounced when taking into 
account the fact that Turkish producers exported mainly black tubes to the Community 
market (i.e. those with a low cost) whereas imports from the cumulated countries were 
mainly  galvanised  tubes  (i.e.  those  with  a  high  cost).  Furthermore,  the  volumes  of 
imports from the cumulated countries are 125% higher than those from Turkey. 

(282)  Bearing in mind the volumes and the undercutting involved it is concluded that a not 
insignificant part of the injury suffered can be attributed to the imports from Turkey. 
However when compared with the impact of the cumulated imports, as detailed above, 
a  much  greater  part  of  the  injury  can  be  attributed  to  imports  from  the  cumulated 
countries. It is therefore concluded that the injury caused by the imports from Turkey 
is not such as to break the causal link between the injury suffered by the Community 
industry and the dumped imports from the cumulated countries. 

5.3.3.  Ukraine, Thailand 

(283)  Imports  from  Ukraine  and  Thailand  were  negligible  and  are  thus  not  considered  to 

have caused material injury to the Community industry.  

5.3.4.  Effect of imports from other third countries 

(284)  In  2004,  imports  from  other  third  countries  (excluding  Bosnia,  Turkey,  Ukraine  and 
Thailand) totalled around 127.000 tonnes or 10,3% of the Community consumption on 
the  Community  market.  During  the  period  under  consideration  this  import  level 
fluctuated  but  by  the  IP  returned  to  the  same  level  of  the  Community  consumption. 
The  average  import  price  in  the  IP  was  735  EUR  per  tonne  in  comparison  with  586 
EUR for 2004. Bearing in mind that the exact type of these imports was not known, it 
was  difficult  to  perform  price  comparisons.  Nevertheless,  it  appears  that  the  prices 
from other third countries are much higher than those of the cumulated countries and 

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the  other  countries  concerned.  This  would  suggest  that  imports  from  other  third 
countries are (at most) undercutting the Community industry prices to a lesser degree 
than  dumped  imports,  or  that  they  would  not  undercut  at  all.  It  can  not  therefore  be 
concluded that they contribute substantially to the injury suffered by the Community 
industry or that they break the causal link.  

5.4. 

Effect of other factors 

5.4.1.  Performance on export markets 

(285)  The  sampled  Community  producers  experienced  a  fall  in  export  sales  volume  from 
around 60.000 tonnes to around 20.000 tonnes over the period under consideration. It 
was  assessed  whether  this  decrease  had  contributed  to  the  injury  suffered  by  the 
Community industry. The volume of sales on third markets never exceeded 10% of the 
total  sales  volume  over  the  period  under  consideration,  and  such  sales  constituted  a 
limited  amount  (ca.  5%)  of  the  total  of  production  which  indicates  that  export  sales 
were not a substantial contributor to the performance of the Community industry. 

(286)  Furthermore it should be noted that the profitability quoted in recital (259) relates only 
to sales on the EU market and is therefore not affected by the above fall in export sales 
volume.  Also,  the  investigation  showed  that  the  profitability  of  sales  on  the 
Community market and on third markets were comparable in each year of the period 
under  consideration.  This  shows  that  there  was  no  real  difference  between 
performance  on  the  EU  and  export  markets.  It  was  therefore  concluded  that,  if  any, 
only  a  negligible  part  of  the  injury  suffered  by  the  Community  industry  could 
eventually  be  attributed  to  this  factor,  and  that  it  was  thus  not  such  as  to  break  the 
causal link. 

5.4.2.  Fluctuation of raw material prices 

(287)  The  cost  of  raw  material  is  a  major  proportion  of  the  total  cost  of  production  of  the 
product concerned (over 75% of the total cost of production if energy is included). As 
a  result,  welded  tubes  prices  are  highly  dependant  on  the  influence  of  raw  material 
costs.  The  most  important  raw  materials  were  coils,  zinc  and  energy.  These 
components increased by more than 20%, 200% and 50% respectively over the period 
under consideration. 

(288)  As explained in recitals (255) and (256), sales prices have also increased over the same 
period. However these prices have not increased to the extent necessary to reflect cost 
increases because of the pressure on the sales prices of competitors on the market and 
in particular due to the pressure of unfair trade of the dumped imports. Therefore the 
investigation  concluded  that  raw  material  prices  in  themselves  were  not  a  cause  of 
injury because in the absence of dumped imports it would have been possible for the 
Community industry to pass on these cost increases – or at least a substantial part of 
them - to its customers. 

(289)  In  addition,  it  is  underlined  that  such  input  cost  increases  are  not  limited  to  the 
Community and that given the nature of the inputs, their level and development would 
be expected to be similar in the countries concerned. 

5.4.3.  Competitiveness and capacity utilisation of the Community industry 

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(290)  It was examined whether the injury suffered by the Community industry resulted from 
a  lack  of  competitiveness  by  the  Community  industry  and/or  by  low  capacity 
utilisation rates. In order to examine this, the cost structure of the Community industry 
was  compared  with  that  of  the  exporting  producers.  Indeed,  some  differences  in 
manufacturing  costs  were  identified  such  as  wage  rates,  energy  costs,  environmental 
and health and safety costs. 

(291)  In  respect  of  capacity  utilisation,  it  is  recalled  that  this  indicator  should  not  be 
overestimated as Community industry was able to produce other products on the same 
equipment. Furthermore, it would be more probable that problems in terms of capacity 
utilisation would be linked to the loss of market share of Community industry which 
was caused by dumped imports. 

(292)  Some  parties  have  argued  that  increasing  operating  costs  have  affected  the 
competitiveness of the Community industry and caused the injury described above at 
section 4. In this respect it must be underlined that these extra operating costs are not 
substantial enough to have caused the material injury identified by this investigation.  

(293)  It  should  be  remembered  that  the  cost  of  the  raw  materials  and  energy  represented 
more  than  75%  of  the  total  cost  of  production  of  the  finished  tubes.  Therefore  the 
potential impact of any increases in other operating costs could in any event only have 
an effect on 25% of the total cost of production. Such increases have been modest, so 
that their impact would not be material. 

(294)  During  the  investigation,  no  structural  inefficiency  was  detected  which  would  make 
the  Community  industry  uncompetitive.  On  the  contrary,  as  stated  in  table  11,  the 
Community  industry  improved  its  productivity  by  17%  during  the  period  under 
consideration.  

(295)  Furthermore, the investigation revealed that the EU market was very competitive not 
least as a consequence of the very large number of companies operating on the market. 
In  addition  to  the  19  Community  producers,  dozens  of  importers  from  around  the 
world  also  contributed  to  the  strong  competition  on  the  EU  market.  Therefore  as 
explained in the recitals above, it was concluded that the Community industry was in 
general very competitive and that any lack of competitiveness did not cause the injury 
suffered by the Community industry. 

5.4.4.  Currency fluctuation 

(296)  Some  interested  parties  alleged  that  the  injury  suffered  by  the  Community  industry 
was  caused  by  currency  fluctuations  which  had  the  effect  of  encouraging  imports  to 
the EU. 

(297)  It  is  recalled  that  the  investigation  has  to  examine  whether  the  dumped  imports  (in 
terms of prices and volumes) have caused material injury to the Community industry 
or whether such material injury was due to other factors. In this respect, with regard to 
prices, Article 3(6) of the basic Regulation states that it is necessary to show that the 
price  level  of  the  dumped  imports  causes  injury.  It  therefore  merely  refers  to  a 
difference between price levels, and there is thus no requirement to analyse the factors 
affecting the level of those prices. 

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(298)  Notwithstanding  the  above  for  many  of  the  exporting  countries  concerned  by  this 
investigation sales are usually made in USD. However the fluctuation of the USD to 
the  EUR  over  the  period  under  consideration  was  limited  to  only  6%.  The  more 
important depreciation of the USD occurred after the end of the IP. From July 2007 to 
April 2008, the USD depreciated by 16% compared to the EUR.  

(299)  It was therefore concluded that currency fluctuations have not caused material injury 

to the Community producers.  

5.4.5.  Strikes 

(300)  Some interested parties made a general allegation (without naming companies or time 
periods  involved)  that  the  injury  suffered  by  Community  industry  was  self-inflicted 
and resulted  from  problems with industrial action and strikes relating to some of the 
producers  in  the  new  Member  States.  In  this  respect  it  should  be  recalled  that  no 
substantiated  evidence  was  put  forward  in  support  of  this  claim.  Furthermore,  the 
accusation only related to part of the Community industry. However similar injurious 
trends  were  found  for  producers  in  both  the  old  and  the  new  Member  States.  It  can 
therefore be concluded that even in the event that some Community industry producers 
were  affected  by  strikes  and  industrial  action  this  fact  would  not  have  been  strong 
enough to break the causal link between dumping and injury.  

5.4.6.  Heavy investments 

(301)  It  was  alleged  that  heavy  investments  by  the  Community  industry  contributed  to  the 
injury suffered. As stated at recital (264), the investigation showed that no such heavy 
investment was made over the period under consideration. It should also be borne in 
mind  that,  even  if  the  allegation  was  substantiated,  the  relatively  low  proportion  of 
depreciation  in  terms  of  total  costs  would  in  any  event  limit  the  impact  of  this 
allegation, and therefore it was concluded that heavy investments have not contributed 
to the injury suffered by the Community industry.  

5.4.7.  Cyclical nature of the steel industry 

(302)  It  was  alleged  that  the  cyclical  nature  of  the  steel  industry  contributed  to  the  injury 
suffered  i.e.  it  is  alleged  that  the  IP  fell  at  the  low  point  of  the  cycle.  First,  it  is 
underlined  that  injurious  dumping  can  very  well  occur  at  all  points  in  the  economic 
cycle.  In  addition,  as  shown  by  the  analysis  of  consumption  at  recital  (231),  the 
investigation  does  not  support  this  argument.  Indeed,  consumption  in  the  IP  was 
buoyant  and  was  clearly  not  at  the  low  point  of  the  cycle.  The  claim  was  therefore 
rejected. 

5.5. 

Conclusion on causation 

(303)  The  coincidence  in  time  between,  on  the  one  hand,  the  increase  of  dumped  imports 
from  the  cumulated  countries,  their  increase  in  market  share,  the  undercutting  and 
underselling  found,  and  on  the  other  hand,  the  deterioration  of  the  situation  of  the 
Community  industry  leads  to  the  conclusion  that  the  dumped  imports  are  a  cause  of 
the material injury suffered by the Community industry. 

(304)  After  analysing  the  known,  salient  other  factors  together  with  allegations  made  by 
interested parties as detailed in recital (285) and subsequent, it is concluded that they 

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are  not  such  as  to  break  the  causal  link  between  the  dumped  imports  from  the 
countries concerned and the material injury suffered by the Community industry. 

F. LIKELIHOOD OF CONTINUATION OR RECURRENCE OF INJURY (EXPIRY 
REVIEW AND TURKEY INTERIM REVIEW) 

(305)  In  accordance  with  Article  11(2)  of  the  basic  Regulation,  imports  from  countries 
currently being reviewed were assessed in order to establish if there was a likelihood 
of continuation or recurrence of injury. 

(306)  With  regard  to  the  likely  effect  on  the  Community  industry  of  the  expiry  of  the 
measures  in  force,  the  following  factors  were  considered  in  line  with  the  elements 
summarised  above  in  respect  of  the  likelihood  of  continuation  or  recurrence  of 
dumping. 

(307)  As explained above in recitals (223) and subsequent, while consumption increased by 
9%, the forecast of world consumption of the product concerned, although potentially 
subject to a certain cyclical trend, is not expected to change to a major degree in the 
foreseeable  future.  Alternative  products  such  as  plastic  piping  have  not  been  able  to 
replace, to a large degree, welded tubes and thus decrease their consumption. 

1. 

Ukraine 

(308)  Since the imposition of the measures, imports from Ukraine have fallen to de minimis 
quantities.  However,  as  mentioned  in  recitals  (172)  (and  subsequent),  there  are  clear 
indications that in the absence of measures significant imports from Ukraine would re-
enter  the  Community  market  at  dumped  prices.  Such  prices  would  also  be  likely  to 
undercut significantly those of the Community industry, given the fact that such prices 
would in all likelihood mirror those set by the lowest bidder in the Community. 

2. 

Thailand 

(309)  Recitals  (119)  (and  subsequent)  concluded  that  significant  volumes  would  in  all 
likelihood  be  exported  from  Thailand  to  the  Community  at  dumped  prices.  These 
prices would also be likely to undercut significantly those of the Community industry, 
given the fact that such prices would in all likelihood mirror those set by the lowest 
bidder in the Community. 

3. 

Turkey 

(310)  Bearing in mind that above it is concluded that there is no likelihood of continuation 
or  recurrence  of  dumping,  no  further  analysis  is  required  here  on  the  likelihood  of 
continuation or recurrence of injury. 

(311)  In  respect  of  injury  issues  relating  to  the  interim  review  (article  11(3)  of  the  basic 
Regulation) no analysis is required here because the review concluded that there was 
no dumping or likelihood of recurrence of dumping for this country. 

4. 

Conclusion on the continuation/recurrence of injury 

(312)  The likely consequence of the lifting of measures would therefore be a large increase 
in  imports  from  both  Ukraine  and  Thailand  at  prices  which  undercut  those  of  the 

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Community  industry.  Such  imports  would  most  likely  have  significant  detrimental 
effects  on  the  Community  industry.  Under  such  circumstances  the  Community 
industry would either have to follow the decrease in prices in order to maintain market 
share,  or  maintain  sales  prices  at  current  levels  and  instead  lose  customers  and 
eventually sales. In the former case, Community industry would have to operate at a 
loss and in the latter case the loss of sales as such would eventually lead to increased 
costs followed by losses.  

(313)  Moreover,  the  Community  industry  has  suffered  the  effects  of  dumped  imports  for 
many  years  and  is  currently  in  a  precarious  economic  situation.  If  this  injurious 
situation continues/recurs the very existence of this industry would be jeopardized. 

(314)  Therefore the investigation  has  revealed  that  there  is,  for  imports  from  both  Ukraine 
and  Thailand,  a  clear  likelihood  of  recurrence  and  continuation  of  injury  to  a 
Community  industry  that  has  been  suffering  the  consequences  of  injurious  dumping 
for many years. In respect of imports from Turkey, injurious dumping is not expected 
to continue or recur.  

G. COMMUNITY INTEREST 

1. 

Introduction 

(315)  Pursuant to Article 21 of the basic Regulation, it has been examined whether despite 
the  conclusions  on  dumping,  injury  and  causal  link,  compelling  reasons  exist  that 
would lead to the conclusion that it is not in the Community interest to impose anti-
dumping measures on imports from the countries concerned or to extend the measures 
in force. 

(316)  In  order  to  assess  the  likely  impact  of  the  imposition  or  non-imposition  of  measures 
and  of  the  extension  or  expiry  of  the  measures  in  force,  the  Commission  requested 
information  from  all  known  interested  parties.  On  this  basis,  the  Commission  sent 
questionnaires  to  116  importers,  stockists  and  users.  No  other  interested  party  made 
itself known within the deadlines. 

(317)  Thirty-two of the contacted unrelated importers replied. Out of them, 16 declared that 
they were not importing from the concerned countries and three that they are no longer 
active  in  this  area  of  business.  Of  the  remaining  13  unrelated  importers  only  two 
submitted a complete questionnaire response. Therefore, it was not necessary to apply 
sampling. 

2. 

Community Industry 

(318)  It is recalled that it was concluded that the Community industry has suffered material 

injury, as set out in recitals (250) to (274). 

(319)  The imposition of anti-dumping measures is likely to allow the Community Industry to 
increase its sales, its market share and its sales prices. The Community industry would 
then be able to reach the levels of profitability which it would achieve in the absence 
of  dumped  imports,  and  to  take  advantage  of  growth  in  the  Community  market:  this 
would encourage investments and the overall competitiveness of the industry.  

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(320)  The  continuation  of  the  measures  in  force  will  allow  the  Community  Industry  to 
continue operating in the framework of fair competition vis-à-vis imports originating 
from  Thailand  and  the  Ukraine.  As  a  result,  the  positive  effects  deriving  from  the 
imposition  of  the  new  anti-dumping  measures  will  not  be  thwarted  by  unfair 
competition. 

(321)  If  fair  market  conditions  were  to  be  restored,  the  Community  industry  is  likely  to 
regain  competitiveness  and  increase  its  profit  margin  to  more  adequate  levels.  The 
Community industry has actually proven to be structurally viable through its economic 
results  in  the  last  decade:  despite  recurring  unfair  competition  from  the  imports  of 
dumped products, it has been able to slow down its loss of market shares. Moreover, 
as set out in recital (295), the Community Industry is competitive and able to increase 
its productivity.  

(322)  On the other hand, should existing anti-dumping measures be repealed and new anti-
dumping measures not be imposed, there will be further trade distortion which would 
lead to a progressive retreat of the Community industry from the market. The repeal of 
current measures and the important production capacity from the countries concerned, 
especially the PRC, would likely lead to an increasing amount of dumped imports to 
the Community market. In these conditions, it would become more and more difficult 
for the Community industry to recover and to defend its market share. Moreover the 
lack  of  investments  in  the  Community  industry  may  eventually  jeopardize  its  long-
term survival. 

3. 

Unrelated importers/stockists 

(323)  It is recalled that the cooperating unrelated importers represented less than 5% of the 
total import volume of the product concerned to the Community during the IP. 

(324)  A  number  of  exporters  did  however  argue  that  the  impact  of  measures  on 
importers/traders  would  be  substantial  as  they  would  face  increasing  costs  for  their 
imports from the countries concerned.  

(325)  Should  anti-dumping  measures  be  imposed,  the  level  of  imports  originating  in  the 
countries  concerned  would  likely  decrease.  Furthermore,  a  moderate  increase  in  the 
sale  price  of  the  product  concerned  in  the  Community  may  indeed  occur,  thus 
affecting the economic situation of importers/stockists, especially those sourcing from 
the countries under investigation. This would be because the resale prices they could 
offer  to  their  customers  would  be  more  comparable  to  those  competitors  which  also 
sourced from the Community industry. 

(326)  However, this impact on the situation of importers and traders is likely to be moderate, 
since  the  product  concerned  represents  a  small  part  of  their  overall  commercial 
activities. On the basis of the information provided by those importers/stockists which 
sent  valid  responses,  it  is  clear  that  they  also  sell  many  other  steel  products.  It  was 
found  that  the  product  concerned  represented  on  average  less  than  4%  of  the  total 
turnover. Moreover, given the relatively low impact of the product concerned in users' 
costs,  importers/stockists  would  likely  be  able  to  pass  on  increases  in  price  to  their 
customers. 

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(327)  On this basis, it has been concluded that the imposition of anti-dumping measures and 
the  continuation  of  the  measures  in  force  is  not  likely  to  have  a  serious  negative 
impact on the situation of importers/stockists in the Community. 

4. 

User industry 

(328)  The main user of the product concerned in the Community is the construction industry. 
The demand for the product concerned is therefore dependent upon the situation of this 
industry.  

(329)  As set out in recital (316), neither interested users nor their representative associations 

have made themselves known during the investigation. 

(330)  A  number  of  other  exporters  did  however  assert  that  the  impact  on  users/consumers 
would  be  substantial  should  measures  be  imposed.  In  particular  it  was  claimed  that 
measure  would  be  detrimental  to  competition  and  lead  to  an  increase  in  costs  for 
users/consumers.  

(331)  As set out in recital (302) it cannot be excluded that the price of the product concerned 
in  the  Community  would  increase  moderately.  Nevertheless,  the  negative  impact  of 
increased costs on users/ consumers would likely be low, since the effect of the price 
of the product concerned in the users/consumers' total costs is moderate. 

(332)  As to the claim made by several exporters that imposition of measures to the group of 
countries  covered  by  the  new  investigation  would  effectively  prevent  competition  in 
the  Community,  the  imposition  of  anti-dumping  measures  and  the  maintain  of 
measures  in  force  will  improve  the  condition  of  the  Community  Industry  and  thus, 
together with suppliers from third countries not concerned by the measures as well as 
non-dumping  exporters  from  the  countries  concerned,  ensure  the  presence  of  a  wide 
range of suppliers on the Community market. 

(333)  Taking into account the above, it is concluded that the imposition of any anti-dumping 
measure is not likely to cause a considerable damage to the economic situation of the 
users of the product concerned. 

5. 

Upstream industry 

(334)  The main raw material used in the production of the product concerned is hot rolled 

coils ("HRC"). 

(335)  As  set  out  in  recital  (316),  neither  interested  upstream  producers  of  HRC  nor  their 

representative associations have made themselves known during the investigation. 

(336)  Should the measures not be imposed, the Community producers of HRC would likely 
face  a  reduction  in  demand,  as  a  consequence  of  the  reduced  activity  of  the 
Community producers of the product concerned. 

(337)  On this basis, it has been concluded that the imposition of anti-dumping measures is in 
the interest of producers of the main raw material used in the production of the product 
concerned in the Community. 

6. 

Conclusion on Community interest  

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61 

   EN 

 
(338)  The continuation of the measures on imports of the product concerned from Thailand 
and the Ukraine and the imposition of anti-dumping measures on imports originating 
in  Belarus,  the  People's  Republic  of  China  and  Russia  are  likely  to  allow  the 
Community  industry  to  stop  losing  market  shares,  regain  lost  sales  and  a  return  to 
adequate profitability. If, however, measures in force were repealed and anti-dumping 
measures  were  not  imposed,  the  Community  industry  would  likely  face  a  growing 
unfair  competition  problem  which  would  drive  certain  Community  producers  out  of 
the  market;  an  additional  cost  would  be  the  shutting  down  or  the  reconversion  of 
machineries. 

(339)  Some  negative  effects  of  the  imposition  of  anti-dumping  measures  would  be  a 
decrease in the volume imported and moderate costs increases for importers/stockists 
and  users/consumers,  due  to  a  higher  sales  price  of  the  product  concerned  in  the 
Community.  

(340)  The  level  of  increase  in  sales  prices  would  nevertheless  not  be  considerable  since 
competition would remain amongst Community producers, imports originating in the 
countries  concerned  made  at  non-dumped  or  non-injurious  prices  and  imports 
originating in other third countries.  

(341)  Finally,  it  has  been  argued  by  one  interested  party  that,  according  to  economic 
literature,  anti-dumping  measures  entail  'severe  welfare  costs  for  the  importing 
countries'. No evidence was provided in this regard in the context of the product and 
economic operators concerned by this case. The present investigation has to consider 
the  case  on  its  own  merits:  according  to  this  approach,  importers/stockists  and 
users/consumers of the product concerned are unlikely to suffer serious consequences, 
given  the very  low  impact of the price  of certain welded tubes on the final costs for 
their products or purchases.  

(342)  The upstream industry is likely to benefit from the continuation of measures in force 
and from the imposition of anti-dumping measures, in the form of a wider demand of 
HRC in the Community market. 

(343)  Taking  into  account  all  of  the  above  factors,  it  is  concluded  that  there  are  no 
compelling  reasons  to  repeal  the  existing  measures  and  not  to  impose  new  anti-
dumping duties. 

H. TERMINATION OF THE PROCEEDING IN RESPECT OF BOSNIA AND 
HERZEGOVINA AND OF TURKEY 

(344)  In view of the findings set out in recitals (52) and respectively (170) onwards, it has 
been  concluded  that  the  proceeding  should  be  terminated  in  respect  of  Bosnia  and 
Herzegovina and of Turkey. 

I. UNDERTAKINGS 

(345)  Two exporting producers in Russia and the sole in Belarus offered price undertakings 

in accordance with Article 8(1) of the basic Regulation 

(346)  Those offers were examined. The investigation showed that most of the findings and 
considerations laid down in Regulation 1697/2002 (see recitals 77 and 78) which led 

EN 

62 

   EN 

 
to  the  rejection  of  all  undertaking  offers  during  that  investigation  are  still  valid. 
Namely, the investigation confirmed that: 

– 

the product concerned is a commodity product with a considerable volatility in 
prices even in the very short term, and therefore  not very  suitable for a fixed 
price  undertaking,  the  volatility  is  due  to  the  variation  in  prices  of  raw 
materials, namely hot rolled coils and zinc, which constitute major but variant 
components of the cost of production. Not only do raw material prices as such 
fluctuate  significantly,  such  fluctuations  are  often  exacerbated  by  fluctuations 
of the EUR/USD exchange rate. It is noted that in particular zinc is commonly 
traded on a USD basis. A monthly revision of prices would be necessary. If the 
minimum prices were indexed to the price of hot rolled coils and zinc, different 
indexing  formulae  would  have  to  be  established  by  sub-product  group,  since 
the energy and manpower per tonne vary between sizes. For this reason, should 
a  review  formula  system  be  implemented,  it  would  be  necessary  to  establish 
between  3  and  4  sub-formulae  for  each  category  of  product  according  to  the 
size range.  

(347)  In  addition,  the  product  concerned  is  characterised  by  a  considerable  number  of 
product types with some characteristics not easily discernible upon importation. This 
makes it virtually impossible to establish minimum import prices for each product type 
which would be meaningful and could be properly monitored by the Commission and 
by the customs authorities of the Member States upon importation. 

(348)  It  is  also  noted  that  additionally  to  those  product  related  reasons,  there  are  company 
specific  reasons  to  reject  the  undertaking  offers.  With  regard  to  the  Belarusian 
producer,  it  is  firstly  recalled  that  Belarus  is  non-market  economy  country  as 
stipulated in Article 2(7)(a) of the basic Regulation and that the company did not apply 
for individual treatment (IT) as  laid down in Article  9(5) of the basic  Regulation. In 
addition, its co-operation in this investigation was only partial as mentioned in recitals 
(101) to (104) and therefore the acceptance of a price undertaking was also considered 
to be inappropriate for general policy reasons. With regard to one Russian exporting 
producer, it is noted that it also sells other products than the product concerned to the 
same customers in the EU. On this basis, this risk of cross-compensation is considered 
to  be  too  high.  With  regard  to  the  second  Russian  exporting  producer,  the  company 
had  difficulties  to  report  accurate  and  reliable  data  which  was  mainly  due  to 
weaknesses  in  its  accounting  system.  In  these  circumstances,  the  Commission 
considered that the company does not have the necessary infrastructure to implement 
an undertaking and to allow for an effective monitoring.  

(349)  Therefore, these price undertaking offers were rejected. 

J. ANTI-DUMPING MEASURES 

(350)  In view of the conclusions reached above, the measures in place applicable to imports 
of the product concerned originating in Thailand and Ukraine should be maintained as 
in the previous regulation except for OJSC Interpipe whose margin is indicated below  

Country 

Company 

Anti-

dumping 

EN 

63 

   EN 

 
Thailand 

Saha Thai Steel Pipe Co. Ltd 

All other companies 

Ukraine 

OJSC Interpipe Nihnedeneprovsky Tube 

duty 

21,7% 

35,2% 

Rolling  Plant  and  OJSC 

Interpipe 

Novomoskovsk Pipe Production Plant 

10.7% 

All other companies 

44,1% 

(351)  In addition, definitive measures on imports of the product concerned originating in the 

PRC, Russia, and Belarus should be imposed as described below. 

1. 

Injury Elimination Level 

(352)  The level of the definitive anti-dumping measures should be sufficient to eliminate the 
material  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 materially injurious dumping, it was considered 
that any measures should allow the Community industry to cover its costs and obtain a 
profit  before  tax  that  could  be  reasonably  achieved  under  normal  conditions  of 
competition, i.e. in the absence of dumped imports. 

(353)  It was alleged by the complainant during the investigation that a 10,8% normal profit 
should be used in this investigation based on the return on turnover achieved in 2004 
for the product concerned. This claim was based on 5 selected Community producers 
and  2004  was  chosen  as  being  representative  because  the  anti-dumping  measures  in 
force were partially effective in offsetting the effect of the dumped imports.  

(354)  However the investigation showed that the profitability rate achieved by even these 5 
selected Community producers was much lower that the 10,8% claimed. Furthermore, 
2004  was  not  considered  to  be  an  appropriate  period  for  this  assessment  because 
injurious dumping was taking place at that time.  

(355)  In the previous investigation, it was considered that a profit margin of 5% of turnover 
could  be  regarded  as  an  appropriate  level  that  the  Community  industry  could  be 
expected to obtain in the absence of injurious dumping based on data from 1997 and 
1998. As this information was not recent, other sources were used to find out if it was 
still  appropriate.  Firstly,  welded  tubes  are  a  very  mature  product,  the  production 
processes for which have hardly changed since 1997. Secondly, recent data available 
from  the  BACH  database  for  a  wide  range  of  metal  manufacturing  companies  gives 
profitability levels of around 5%. 

(356)  It  was  therefore  concluded  that  a  5%  profitability  level  remains  appropriate  for  this 

product. 

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64 

   EN 

 
(357)  The non-injurious price was obtained by adding the normal profit as calculated above 
to  the  cost  of  production  of  each  product  type.  Any  difference  between  this  non 
injurious price and the export price of the same product type was then expressed as a 
percentage of the total CIF import value. 

(358)  For the Chinese cooperating exporting companies, it should be recalled that none were 
granted MET nor IT and therefore a country-wide injury margin was calculated. The 
calculation  was  based  on  the  co-operating  exporting  producers.  The  data  for  one 
Chinese exporter was excluded from this calculation since sufficiently complete PCN 
data were not reported to the Commission. 

(359)  As far as Belarus is concerned, a country-wide duty was also calculated based on the 
import  prices  of  the  German  importer  as  mentioned  at  recital  (95)  in  the  absence  of 
sufficient co-operation.  

(360)  In  respect  of  Russia  the  co-operating  exporting  producers  were  granted  individual 
injury  margins  For  non  co-operators,  bearing  in  mind  that  the  cooperation  level  was 
above  80%,  the  country-wide  injury  margin  was  set  at  the  level  of  the  highest  co-
operator.  

(361)  In  view  of  the  conclusions  reached  above,  the  following  injury  margins  were 

calculated: 

Country 

Company 

The PRC 

All companies 

Russia 

TMK  Group  (Seversky  Pipe  Plant  Open 

Injury 

margin 

90,6% 

Joint  Stock  Company  and  Joint  Stock 

Company 

Taganrog  Metallurgical 

Works) 

16,8% 

OMK  Group 

(Open 

Joint  Stock 

Company  Vyksa  Steel  Works  and  Joint 

Stock Company Almetjvesk Pipe Plant ) 

20,5% 

All other companies 

Belarus 

All companies 

2. 

Definitive duties 

20,5% 

38,1% 

(362)  In light of the foregoing, and in accordance with Article 9(4) of the basic Regulation, 
it is considered that definitive anti-dumping measures should be imposed on imports 
originating in the PRC, Russia and Belarus at the level of the lowest of the dumping 
and injury margins, in accordance with the lesser duty rule.  

EN 

65 

   EN 

 
 
 
(363)  On the basis of the above, the proposed definitive duties are as follows: 

Country 

Company 

The PRC 

All companies 

Russia 

(364)  TMK Group (Seversky Pipe Plant 

Anti-

dumping 

duty 

90,6% 

Open  Joint  Stock  Company  and 

Joint  Stock  Company  Taganrog 

Metallurgical Works) 

16,8% 

OMK  Group 

(Open 

Joint  Stock 

Company  Vyksa  Steel  Works  and  Joint 

Stock Company Almetjvesk Pipe Plant ) 

10,1% 

All other companies 

Belarus 

All companies 

20,5% 

38,1% 

HAS ADOPTED THIS REGULATION: 

Article 1 

1. A definitive anti-dumping duty is hereby imposed on imports of welded tubes and pipes, of 
iron  or  non-alloy  steel,  of  circular  cross-section  and  of  an  external  diameter  not  exceeding 
168,3 mm, excluding line pipe of a kind used for oil or gas pipelines, casing and tubing of a 
kind used in drilling for oil or gas, precision tubes and tubes and pipes with attached fittings 
suitable  for  conducting  gases  or  liquids  for  use  in  civil  aircraft,  falling  within  CN  codes  ex 
7306 30 41, ex 7306 30 49, ex 7306 30 72 and ex 7306 30 77 (TARIC codes 7306 30 41 20, 
7306  30  49  20,  7306  30  72  80  and  7306  30  77  80)  and  originating  in  Belarus,  the  People's 
Republic of China, Russia, Thailand and Ukraine. 

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

Country 

Company 

Anti-
dumping 
duty 

TARIC 
additional 
code 

Thailand 

Saha Thai Steel Pipe Co. Ltd 

21,7% 

A405 

EN 

66 

   EN 

 
 
 
 
 
All other companies 

35,2% 

A999 

Ukraine 

OJSC  Interpipe  Nihnedeneprovsky  Tube 

A345 

Rolling  Plant 

and  OJSC 

Interpipe 

Novomoskovsk Pipe Production Plant 

10,7% 

All other companies 

44,1% 

A999 

The PRC 

All companies 

90,6% 

- 

Russia 

(365)  TMK  Group  (Seversky  Pipe  Plant 

A892 

Open  Joint  Stock  Company  and 

Joint  Stock  Company  Taganrog 

Metallurgical Works) 

16,8% 

OMK Group (Open Joint Stock Company 

A893 

Vyksa  Steel  Works  and  Joint  Stock 

Company Almetjvesk Pipe Plant ) 

10,1% 

All other companies 

20,5% 

A999 

Belarus 

All companies 

38,1% 

- 

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

The  anti-dumping  proceeding  concerning  imports  of  the  product  concerned  originating  in 
Bosnia and Herzegovina is hereby terminated 

Article 2 

Article 3 

The  anti-dumping  proceeding  concerning  imports  of  the  product  concerned  originating  in 
Turkey is hereby terminated 

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

Article 4 

This Regulation shall be binding in its entirety and directly applicable in all Member States. 

EN 

67 

   EN 

 
 
 
Done at Brussels, […] 

For the Council 
The President 
[…] 

EN 

68 

   EN