Council Regulation (EC) No 1176/2008 of 27 November 2008 amending Council Regulation (EC) No 713/2005 imposing a definitive countervailing duty on imports of certain broad spectrum antibiotics originating in India
Date: 2008-11-27
Institutions: Council of the European Union
Subjects: India, anti-dumping legislation, antibiotic, pharmaceutical industry

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(Acts adopted under the EC Treaty/Euratom Treaty whose publication is obligatory)

I

REGULATIONS

COUNCIL REGULATION (EC) No 1176/2008

of 27 November 2008

amending Council Regulation (EC) No 713/2005 imposing a definitive countervailing duty on
imports of certain broad spectrum antibiotics originating in India

THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty
Community,

establishing the European

Having regard to Council Regulation (EC) No 2026/97 of
6 October 1997 on protection against subsidised imports
from countries not members of the European Community (1)
(the basic Regulation), and in particular Articles 15 and 19
thereof,

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

Whereas:

A. PROCEDURE

(1)

I. Previous investigation and existing measures

The Council, by Regulation (EC) No 713/2005 (2),
imposed a definitive countervailing duty on imports of
certain broad spectrum antibiotics, namely amoxicillin
trihydrate, ampicillin trihydrate and cefalexin not put
up in measured doses or in forms or packings for
falling within CN
retail sale (the product concerned)
and
codes
ex 2941 10 10,
ex 2941 90 00 originating in India. The rate of
the
duty ranges between 17,3 % and 30,3 % for individually
named exporters with a residual duty rate of 32 %
imposed on imports from other exporters.

ex 2941 10 20

the circumstances with regard to two subsidy
that
schemes (the Duty Entitlement Passbook Scheme and
the Income Tax Exemption under Section 80 HHC of
these
the Income Tax Act) have changed and that
it was
changes are of a lasting nature. Consequently,
argued that the level of subsidisation was likely to have
decreased and thus measures that had been established
partly on these schemes should be revised.

(3)

(4)

sufficient

The Commission examined the evidence submitted by
to justify the
the GOI and considered it
initiation of a review in accordance with the provisions
of Article 19 of the basic Regulation. After consultation
of the Advisory Committee, the Commission initiated by
a notice published in the Official Journal of the European
Union (3), an ex-officio partial interim review of Regulation
(EC) No 713/2005.

The purpose of the partial interim review investigation is
to assess the need for the continuation, removal or
amendment of
in respect of
the existing measures
those companies which benefited from one or both the
changed subsidy schemes where sufficient evidence was
provided in line with the relevant provisions of
the
notice of initiation. The partial
interim review investi­
gation would also assess the need, depending on the
to revise the measures applicable to
review findings,
other companies that cooperated in the investigation
that set the level of the existing measures and/or the
residual measure applicable for all other companies.

II. Initiation of a partial interim review

III. Investigation period

(2)

Following the imposition of the definitive countervailing
duty, the Government of India (GOI) made submissions

(5)

The investigation covered the period from 1 April 2006
to 31 March 2007 (‘the review investigation period’ or
‘RIP’).

(1) OJ L 288, 21.10.1997, p. 1.
(2) OJ L 121, 13.5.2005, p. 1.

(3) OJ C 212, 11.9.2007, p. 10.

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IV. Parties concerned by the investigation

2. exporting producers in India

The Commission officially informed the GOI and those
Indian exporting producers who cooperated in the
previous investigation, were mentioned under Regulation
(EC) No 713/2005 and were listed in the notice of
initiation of the partial interim review, that were found
to benefit from any of the two allegedly changed subsidy
schemes, as well as the Community producers of the
interim review investigation.
initiation of
Interested parties had the opportunity to make their
views known in writing and to request a hearing. The
written and oral comments submitted by the parties were
considered and, where appropriate, taken into account.

the partial

In view of the apparent number of parties involved in
this review, the use of sampling techniques for the inves­
tigation of subsidisation was envisaged in accordance
with Article 27 of the basic Regulation.

Only two exporting producers made themselves known
and provided the information requested for sampling.
Therefore,
sampling techniques was not
considered necessary.

the use of

(12)

(13)

Ranbaxy Laboratories Ltd, New Delhi.

V. Disclosure and comments on procedure

The GOI and the other interested parties were informed
of the essential facts and considerations upon which it
was
intended to propose to amend the duty rate
applicable to the sole cooperating Indian producer and
prolong existing measures for all other companies which
did not cooperate with this partial interim review. They
were also given a reasonable time to comment. All
submissions and comments were taken duly into con­
sideration as set out below.

B. PRODUCT CONCERNED

The product covered by this review is the same product
as the one concerned by Regulation (EC) No 713/2005,
namely amoxicillin trihydrate, ampicillin trihydrate and
cefalexin not put up in measured doses or in forms or
packings
falling within CN codes
ex 2941 10 10, ex 2941 10 20 and ex 2941 90 00 orig­
inating in India.

retail

sale

for

(6)

(7)

(8)

(9)

in force or

However, one of the aforesaid exporting producers stated
in its sampling reply that it did not receive benefits under
the two allegedly changed subsidy schemes (i.e. the Duty
Entitlement Passbook Scheme and the Income Tax
Exemption under Section 80 HHC of the Income Tax
Act) during either the investigation period that led to
the measures
this
company did not cooperate in the original investigation,
the
and no particular need was identified to adapt
residual measure applicable to all other companies,
including this one. Thus,
fulfil
the eligibility provisions of
the partial
interim review investigation as set out in point 4 of
the notice of initiation and could not therefore parti­
cipate in this review investigation. The company in
question was informed accordingly.

the company did not

the RIP. Moreover,

the scope of

(10)

The Commission sent questionnaires to the sole coop­
erating exporting producer which was eligible for this
review (Ranbaxy Laboratories Ltd) and to the GOI.
Replies were received from both that producer and the
GOI.

(11)

The Commission sought and verified all
information it
deemed necessary for the determination of subsidisation.
Verification visits were carried out at the premises of the
following interested parties:

1. Government of India

C. SUBSIDIES

I. Introduction

(14) On the basis of the information submitted by the GOI
and the sole cooperating exporting producer and the
replies to the Commission’s questionnaire, the following
granting of
schemes, which allegedly
subsidies, were investigated:

involve

the

(a) Advance Authorisation Scheme (formerly known as

Advance Licence Scheme);

(b) Duty Entitlement Passbook Scheme;

(c) Export Promotion Capital Goods Scheme;

(d) Focus Market Scheme;

(e)

Income Tax Schemes:

— Export Income Tax Exemption Scheme,

— Income Tax Incentive for Research and Develop­

ment;

Ministry of Commerce, New Delhi;

(f) Export Credit Scheme.

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(15)

(16)

(17)

(18)

The schemes (a) to (d) specified above are based on the
Foreign Trade (Development and Regulation) Act 1992
(No 22 of 1992) which entered into force on 7 August
1992 (Foreign Trade Act). The Foreign Trade Act
authorises the GOI to issue notifications regarding the
export and import policy. These are summarised in
‘Export and Import Policy’ documents, which are issued
by the Ministry of Commerce every five years and
and Import Policy
updated regularly. One Export
i.e. the
document is relevant to the RIP of this case;
five-year plan relating to the period 1 September 2004
to 31 March 2009 (EXIM policy 04-09). In addition, the
GOI also sets out the procedures governing the EXIM
‘Handbook of Procedures —
policy 04-09 in a
1 September 2004 to 31 March 2009, Volume I’ (HOP
I 04-09). The Handbook of Procedure is also updated on
a regular basis.

The Income Tax Schemes specified above under (e) are
based on the Income Tax Act of 1961, which is amended
yearly by the Finance Act.

The Export Credit Scheme specified above under (f) is
based on sections 21 and 35A of the Banking Regulation
Act 1949, which allow the Reserve Bank of India (RBI) to
direct commercial banks in the field of export credits.

In accordance with Article 11(10) of the basic Regu­
lation, the Commission invited the GOI for additional
consultations with respect
to both changed and
unchanged schemes with the aim of clarifying the
factual situation as regards the alleged schemes and
arriving at a mutually agreed solution. Following these
consultations, and in the absence of a mutually agreed
solution in relation to these schemes, the Commission
included all these schemes in the investigation of subsi­
disation.

II. Specific schemes

1. Advance Authorisation Scheme (AAS)

(a) L e g a l b a s i s

(19)

The detailed description of the scheme is contained in
paragraphs 4.1.1 to 4.1.14 of the EXIM policy 04-09 and
chapters 4.1 to 4.30 of the HOP I 04-09. This scheme
was called Advance Licence Scheme during the previous
review investigation that led to the imposition by Regu­
lation (EC) No 713/2005 of the definitive countervailing
duty currently in force.

(b) E l i g i b i l i t y

(20)

The AAS consists of six sub-schemes, as described in
in recital 21. Those sub-schemes differ,
more detail
inter alia,
in the scope of eligibility. Manufacturer-
exporters and merchant-exporters ‘tied to’ supporting
manufacturers are eligible for the AAS physical exports
and for the AAS for annual requirement. Manufacturer-

the EXIM policy 04-09,

exporters supplying the ultimate exporter are eligible for
AAS for intermediate supplies. Main contractors which
supply to the ‘deemed export’ categories mentioned in
paragraph 8.2 of
such as
suppliers of an export oriented unit (EOU), are eligible
intermediate
for AAS
eligible
suppliers
for
‘deemed
sub-schemes
Advance Release Order (ARO) and back-to-back inland
letter of credit.

to manufacturer-exporters
export’
benefits

Eventually,
are
the

deemed

export.

under

(c) P r a c t i c a l

i m p l e m e n t a t i o n

(21) Advance authorisations can be issued for:

(i) physical exports:

a

‘Physical’

this is the main sub-scheme.

It
allows for duty-free import of input materials for
the production of
export
product.
in this context means that the
export product has to leave Indian territory. An
import allowance and export obligation including
the type of export product are specified in the
authorisation;

resultant

specific

(ii) annual requirement: such an authorisation is not
linked to a specific export product, but to a wider
product group (e.g. chemical and allied products).
The authorisation holder can — up to a certain
value threshold set by its past export performance
— import duty free any input to be used in manu­
the items falling under such a
facturing any of
product group.
any
It
resultant product falling under the product group
using such duty-exempt material;

can choose

to export

(iii) intermediate supplies: this sub-scheme covers cases
where two manufacturers intend to produce a single
export product and divide the production process.
The manufacturer-exporter who produces the inter­
mediate product can import duty-free input materials
and can obtain for this purpose an AAS for inter­
mediate supplies. The ultimate exporter finalises the
production and is obliged to export
the finished
product;

(iv) deemed exports:

this sub-scheme allows a main
contractor to import inputs free of duty which are
required in manufacturing goods
to be sold as
‘deemed exports’
to the categories of customers
mentioned in paragraph 8.2(b) to (f), (g), (i) and (j)
of the EXIM policy 04-09. According to the GOI,
deemed exports refer to those transactions in which
leave the country. A
the goods supplied do not
number of categories of
regarded as
deemed exports provided the goods are manu­
factured in India, e.g. supply of goods to an EOU
or to a company situated in a special economic zone
(SEZ);

supply is

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(v) ARO: the AAS holder intending to source the inputs
from indigenous sources, in lieu of direct import, has
the option to source them against AROs. In such
cases the Advance Authorisations are validated as
AROs and are endorsed to the indigenous supplier
the items specified therein. The
upon delivery of
endorsement of
the ARO entitles the indigenous
supplier to the benefits of deemed exports as set
out
the EXIM policy 04-09
(i.e. AAS for intermediate supplies/deemed export,
deemed export drawback and refund of
terminal
excise duty). The ARO mechanism refunds taxes
and duties to the supplier instead of refunding the
same to the ultimate exporter in the form of draw­
back/refund of duties. The refund of taxes/duties is
available both for
inputs as well as
indigenous
imported inputs;

in paragraph 8.3 of

(vi) back-to-back inland letter of credit: this sub-scheme
again covers indigenous supplies to an Advance
Authorisation holder. The holder of an Advance
Authorisation can approach a bank for opening an
inland letter of credit in favour of an indigenous
supplier. The authorisation will be invalidated by
the bank for direct import only in respect of the
items being sourced indi­
value and volume of
genously instead of
importation. The indigenous
supplier will be entitled to the forecast export
benefits as set out in paragraph 8.3 of the EXIM
policy 04-09 (i.e. AAS for intermediate supplies/
deemed export, deemed export drawback and
refund of terminal excise duty).

It was established that during the RIP the coop­
erating exporter only obtained concessions under
two sub-schemes linked to the product concerned,
i.e. (i) AAS physical exports and (ii) AAS for inter­
is therefore not necessary to
mediate supplies.
establish the countervailability of
the remaining
unused sub-schemes.

It

the
of

countervailing

imposition by Regulation (EC) No
Following
713/2005
duty
the
definitive
currently in force, the GOI has modified the verification
system applicable to AAS. In concrete terms, for verifi­
cation purposes by the Indian authorities, an Advance
Authorisation holder is legally obliged to maintain ‘a
true and proper account of consumption and utilisation
of duty-free imported/domestically procured goods’ in a
specified format (chapters 4.26, 4.30 and Appendix 23
HOP I 04-09), i.e. an actual consumption register. This
register has to be verified by an external chartered
accountant/cost and works accountant who issues a cer­
tificate stating that the prescribed registers and relevant
records have been examined and the
information
furnished under Appendix 23 is true and correct in all
respects. Nevertheless, the aforesaid provisions apply only
to Advance Authorisations issued on or after 13 May
2005. For all Advance Authorisations or Advance
Licences issued before that date, holders are requested
to
verification
i.e. to keep a true and proper account of
provisions,
imported
licence-wise consumption and utilisation of

follow the

previously

applicable

(22)

goods in the specified format of Appendix 18 (chapter
4.30 and Appendix 18 HOP I 02-07).

imports

and the

export obligation are

(23) With regard to the sub-schemes used during the RIP by
the sole cooperating exporting producer,
i.e. physical
exports and intermediate supplies, both the import
fixed in
allowance
volume and value by the GOI and are documented on
the authorisation. In addition, at the time of import and
of export, the corresponding transactions are to be docu­
mented by government officials on the authorisation. The
is
volume of
determined by the GOI on the basis of standard input-
output norms (SIONs). SIONs exist for most products
including the product concerned and are published in
the HOP II 04-09. Following the imposition by Council
Regulation (EC) No 713/2005 of the definitive counter­
vailing duty currently in force, SION norms for the
product
to
September 2005. New norms were issued in September
2006 (for amoxicillin trihydrate) and April 2007 (for
ampicillin trihydrate and cefalexin).
In the meantime,
ad-hoc norms applied.

concerned were

allowed under

applicable

scheme

only

this

up

(24)

(25)

(26)

Imported input materials are not transferable and have to
be used to produce the resulting export product. The
export obligation must be fulfilled within a prescribed
time-frame
authorisation (24
months with two possible extensions of six months
each).

issuance of

after

the

The review investigation established that raw materials
were imported under different authorisations/licences
and different SION norms and then were mixed and
physically incorporated in the production process of
the same exported good. Account taken of the above,
it was not possible to establish whether SION norm
authoris­
requirements,
ations/licences, with respect to duty-free input materials
exceed the material needed to produce the reference
quantity of the resulting export product.

stipulated

specific

under

The review investigation also established that the verifi­
cation requirements stipulated by the Indian authorities
were either not honoured or not yet tested in practice.
For Advance Licences issued before 13 May 2005 the
necessary actual consumption and stock registers (i.e.
Appendix 18) did not exist. For Advance Authorisations
actual
issued after 13 May 2005 the necessary
consumption and stock registers were used but GOI
had not yet verified the compliance of these registers
with EXIM policy requirements. In the latter case, the
registers were only verified by an external chartered
accountant as required by the relevant Indian legislation

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(27)

mentioned under recital 22. Nevertheless, there were no
records kept either by the company or by the chartered
accountant on how this certification process took place.
There was no audit plan or any other supporting material
of the audit performed, no recorded information on the
methodology used and the specific requirements needed
for such scrupulous work that requires detailed technical
knowledge on production processes,
EXIM policy
requirements and accounting procedures. Account taken
it is considered that the investigated
of this situation,
exporter was not able to demonstrate that the relevant
EXIM provisions were met.

(d) D i s c l o s u r e c o m m e n t s

it

the

respect

taken of

and that

is noted that

investigation. Moreover,

The sole cooperating producer submitted comments on
the AAS. The company claimed that despite the situation
described under recital 24 it was possible to establish
whether SION norm requirements
stipulated under
specific authorisations exceed the materials needed to
produce the reference quantity of the resulting export
company maintained actual
product
consumption records in highly meticulous manner.
In
this
the actual production
records confirmed that it was not possible to establish
a
reliable benchmark per given authorisation (i.e.
materials needed to produce the reference quantity)
account
the various applicable SION norms
and the incoherent mixture of raw materials used for
production. Furthermore, raw materials covered by the
scheme were found to be used for products other than
the product concerned. Thus, making virtually impossible
any attempt to calculate yield results for the product
under
the company did not
keep, in breach of the relevant GOI provisions, the per
(i.e.
EXIM policy
Appendix 18) which purpose is to provide a compre­
actual
hensible way of monitoring
consumption.
that
company
Article 26(1) of
the basic Regulation does not
empower the Commission to examine the records of
the independent chartered accountant. According to the
company, the certificate has to be accepted unless there
are grounds to believe that the chartered accountant has
made a false certification. In this respect it is recalled that
the verification process performed by the chartered
accountant and the issuing of
the relevant certificate
form part of the verification system introduced by the
GOI in its EXIM policy, as described under recital 22. The
Commission was therefore obliged to examine whether
the aforesaid verification system was effectively applied.
Furthermore, in line with the provisions of Article 11(8)
of the basic Regulation, the Commission had to examine
the information supplied during the course of the inves­
tigation upon which findings are based.

and verifying
claimed
also

consumption

requested

record

The

that neither the company nor the assigned
The fact
chartered account hold any record on the checks
performed in order to issue the EXIM policy stipulated
certificate demonstrates that the company was not in a
position to prove
relevant EXIM policy
provisions were met. The company disputed the fact

that

the

its
that GOI has not yet verified the compliance of
registers with EXIM policy requirements but did not
provide any concrete evidence on its claim. It was also
argued that the actual consumption of the sole coop­
erating producer had been higher than the SION norms
for every input and that there was no excess remission of
duties. Nevertheless, account taken of the actual situation
found on the spot (i.e. mixture of inputs and produced
products, use of different SION norms,
lack of the by
EXIM policy stipulated actual consumption registers) and
pending the fulfilment of the necessary final verification
steps by the GOI, any calculation with respect to actual
consumption and consequent excess remission of duties
per authorisation/license
and SION norm was not
feasible. Therefore, all the aforesaid claims had to be
rejected. Finally, the company provided comments on a
computation error which was considered warrant and
was acknowledged in the calculation of
the subsidy
amount.

(28)

(29)

(e) C o n c l u s i o n

The exemption from import duties is a subsidy within
the meaning of Article 2(1)(a)(ii) and Article 2(2) of the
basic Regulation, i.e. a financial contribution of the GOI
which conferred a benefit upon the investigated exporter.

In addition, AAS physical exports and AAS for inter­
in law upon
mediate supply are clearly contingent
export performance,
and therefore deemed to be
specific and countervailable under Article 3(4)(a) of the
basic Regulation. Without an export commitment a
company cannot obtain benefits under these schemes.

amounts

(30) None of the two sub-schemes used in the present case
can be considered as permissible duty drawback systems
or substitution drawback systems within the meaning of
Article 2(1)(a)(ii) of the basic Regulation. They do not
conform to the rules laid down in Annex I point (i),
Annex II (definition and rules for drawback) and Annex
III (definition and rules for substitution drawback) of the
basic Regulation. The GOI did not effectively apply its
verification system or procedure to confirm whether and
in what
consumed in the
inputs were
production of the exported product (Annex II(II)(4) of
in the case of substitution
the basic Regulation and,
drawback schemes, Annex III(II)(2) of the basic Regu­
lation). The SIONs themselves cannot be considered a
verification system of actual consumption, since duty-
free
authoris­
ations/licences with different SION yields are mixed in
the same production process for an exporting good. This
type of process does not enable the GOI to verify with
sufficient precision what
inputs were
consumed in the export production and under which
SION benchmark they should be compared. Furthermore,
an effective control done by the GOI based on a correctly
kept actual consumption register either did not take place
or has not yet been completed. In addition, the GOI did
not carry out a further examination based on actual

input materials

amounts of

imported

under

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inputs involved, although this would normally need to be
carried out in the absence of an effectively applied veri­
fication system (Annex II(II)(5) and Annex III(II)(3) to the
basic Regulation). Finally, the involvement of chartered
accountants in the verification process has not led to the
improvement of the verification system as no detailed
rules
should
exist on how chartered accountants
perform the
information
presented during the investigation could not warrant
the fulfilment of the aforesaid rules laid down under
the basic Regulation.

entrusted tasks

and the

(34)

The subsidy rate established in respect of this scheme
during the RIP for
cooperating producer
the sole
amounts to 8,2 %.

2. Duty Entitlement Passbook Scheme (DEPBS)

(a) L e g a l B a s i s

(35)

The detailed description of the DEPBS is contained in
paragraph 4.3 of
the EXIM policy 04-09 and in
chapter 4 of the HOP I 04-09.

(31)

These two sub-schemes are therefore countervailable.

(b) E l i g i b i l i t y

(32)

(33)

(f) C a l c u l a t i o n o f

t h e s u b s i d y a m o u n t

the

systems,

In this respect,

In the absence of permitted duty drawback systems or
substitution drawback
countervailable
benefit is the remission of total import duties normally
due upon importation of inputs.
it is
noted that the basic Regulation does not only provide
for the countervailing of an ‘excess’ remission of duties.
According to Article 2(1)(a)(ii) and Annex I(i) of the basic
Regulation only an excess remission of duties can be
countervailed, provided the conditions of Annexes II
and III of the basic Regulation are met. However, these
conditions were not fulfilled in the present case. Thus, if
an absence of an adequate monitoring process is estab­
lished, the above exception for drawback schemes is not
applicable and the normal rule of the countervailing of
the amount of (revenue forgone) unpaid duties, rather
than any purported excess remission, applies. As set
out in Annexes II(II) and III(II) of the basic Regulation
the burden is not upon the investigating authority to
contrary,
calculate
according to Article 2(1)(a)(ii) of the basic Regulation it
only has to establish sufficient evidence to refute the
appropriateness of an alleged verification system.

remission. To the

such excess

The subsidy amount for the exporter which used the
import duties
AAS was calculated on the basis of
forgone (basic customs duty and special additional
customs duty) on the material imported under the two
sub-schemes used for the product concerned during the
RIP (nominator). In accordance with Article 7(1)(a) of the
basic Regulation, fees necessarily incurred to obtain the
subsidy were deducted from the subsidy amount where
accordance with
justified
subsidy
Article 7(2) of
this
turnover
amount has been allocated over the export
generated by the product concerned during the RIP as
appropriate
is
contingent upon export performance and was not
granted by reference to the quantities manufactured,
produced, exported or transported.

the basic Regulation,

claims were made.

denominator,

because

subsidy

the

In

(36) Any manufacturer-exporter or merchant-exporter

is

eligible for this scheme.

(c) P r a c t i c a l
D E P B S

i m p l e m e n t a t i o n

o f

t h e

(37) An eligible exporter can apply for DEPBS credits which
are calculated as a percentage of the value of products
exported under this scheme. Such DEPBS rates have been
established by the Indian authorities for most products,
including the product concerned. They are determined on
the basis of SIONs,
taking into account a presumed
import content of inputs in the export product and the
customs duty incidence on such presumed imports,
regardless of whether import duties have actually been
paid or not.

(38)

To be eligible for benefits under this scheme, a company
must export. At the point in time of the export trans­
action, a declaration must be made by the exporter to the
authorities in India indicating that the export is taking
place under the DEPBS. In order for the goods to be
exported,
the Indian customs authorities issue, during
the dispatch procedure, an export shipping bill. This
document shows, inter alia, the amount of DEPBS credit
which is to be granted for that export transaction. At this
point in time, the exporter knows the benefit it will
receive. Once the customs authorities issue an export
shipping bill,
the
granting of a DEPBS credit. The relevant DEPBS rate to
calculate the benefit is that which applied at the time the
export declaration is made. Therefore, there is no possi­
bility for a retroactive amendment to the level of the
benefit.

the GOI has no discretion over

(39) DEPBS credits are freely transferable and valid for a
period of 12 months from the date of issue. They can
be used for payment of customs duties on subsequent
imports of any goods unrestrictedly importable, except
capital goods. Goods imported against such credits can
be sold on the domestic market (subject to sales tax) or
used otherwise.

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(40) Applications for DEPBS credits are electronically filed and
can cover an unlimited amount of export transactions.
De facto, no strict deadlines exist to apply for DEPBS
credits. The electronic system used to manage DEPBS
transactions
does not
outside the deadline submission periods mentioned in
chapter 4.47 HOP I 04-09. Furthermore, as clearly
provided in chapter 9.3 HOP I 04-09 applications
received after the expiry of submission deadlines can
always be considered with the imposition of a minor
penalty fee (i.e. 10 % on the entitlement).

automatically exclude

export

(d) D i s c l o s u r e c o m m e n t s

(41) Upon disclosure the sole cooperating exporting producer
submitted comments on DEPBS. The company claimed
that DEPBS benefit should not be countervailed because
it was not availed for the product concerned. However,
the company did not provide any argument that could
dispute the practical implementations of the scheme as
expressed under recitals 37 to 40. The company also
the exports
claimed that only the credit amount of
made during the RIP should be used for the calculation
of the duty benefit granted but failed to substantiate why
the calculation methodology used both in the present
and previous investigation that led to the imposition of
the existing measures are not in line with the provisions
of the basic Regulation. Therefore, those claims had to be
rejected. Finally, the company provided comments on a
computation error which was considered warrant and
the subsidy
was acknowledged in the calculation of
amount.

(42)

(43)

(44)

(e) C o n c l u s i o n s o n t h e D E P B S

The DEPBS provides subsidies within the meaning of
Article 2(1)(a)(ii) and Article 2(2) of the basic Regulation.
A DEPBS credit is a financial contribution by the GOI,
since the credit will eventually be used to offset import
duties, thus decreasing the GOI’s duty revenue which
would be otherwise due. In addition, the DEPBS credit
confers a benefit upon the exporter, because it improves
its liquidity.

is

contingent

in law upon export
The DEPBS
performance, and therefore deemed to be specific and
countervailable under Article 3(4)(a) of the basic Regu­
lation.

This scheme cannot be considered a permissible duty
substitution drawback system
drawback system or
the basic
within the meaning of Article 2(1)(a)(ii) of
Regulation. It does not conform to the strict rules laid
down in Annex I point (i), Annex II (definition and rules
(definition and rules for
for drawback) and Annex III
substitution drawback) of
the basic Regulation. An
exporter is under no obligation to actually consume

inputs used. Moreover,

the goods imported free of duty in the production
process and the amount of credit is not calculated in
relation to actual
there is no
system or procedure in place to confirm which inputs
are consumed in the production process of the exported
product or whether an excess payment of import duties
occurred within the meaning of point (i) of Annex I and
Annexes II and III of the basic Regulation. Lastly, an
exporter is eligible for the DEPBS benefits regardless of
whether it imports any inputs at all. In order to obtain
the benefit,
for an exporter to simply
export goods without demonstrating that any input
material was
imported. Thus, even exporters which
procure all of their inputs locally and do not import
any goods which can be used as inputs are still entitled
to benefit from the DEPBS.

is sufficient

it

(45)

(f) C a l c u l a t i o n o f

t h e s u b s i d y a m o u n t

In accordance with Articles 2(2) and 5 of the basic Regu­
lation and the calculation methodology used for this
scheme in Regulation (EC) No 713/2005, the amount
of countervailable subsidies was calculated in terms of
the benefit conferred on the recipient, which is found
to exist during the RIP. In this regard, it was considered
that the benefit is conferred on the recipient at the point
in time when an export transaction is made under this
scheme. At this moment, the GOI is liable to forego the
customs duties, which constitutes a financial contribution
within the meaning of Article 2(1)(a)(ii) of
the basic
issue an
customs authorities
the
Regulation. Once
export shipping bill which shows, inter alia, the amount
of DEPBS credit which is to be granted for that export
transaction, the GOI has no discretion as to whether or
not to grant the subsidy and it has no discretion as to
the amount of the subsidy. Any change of the DEPBS
rates between the actual export and the issuance of a
DEPBS licence has no retroactive effect on the level of
the benefit granted. Furthermore, the sole cooperating
exporting producer booked the DEPBS credits on an
accrual basis as income at the stage of export transaction.

(46) Where

justified claims were made,

fees necessarily
incurred to obtain the subsidy were deducted from the
credits so established to arrive at the subsidy amount as
nominator, pursuant to Article 7(1)(a) of the basic Regu­
lation. In accordance with Article 7(2) of the basic Regu­
lation this subsidy amount has been allocated over the
total export
turnover during the review investigation
period as appropriate denominator, because the subsidy
is contingent upon export performance and it was not
granted by reference to the quantities manufactured,
produced, exported or transported.

(47)

The subsidy rate established in respect of this scheme
during the RIP for
the sole cooperating exporting
producer amounts to 2,1 %.

L 319/8

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Official Journal of the European Union

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(53)

(54)

(55)

(56)

3. Export Promotion Capital Goods Scheme (EPCGS)

(a) L e g a l b a s i s

(48)

The detailed description of the EPCGS is contained in
chapter 5 of the EXIM policy 04-09 and in chapter 5
of the HOP I 04-09.

(b) E l i g i b i l i t y

(49) Manufacturer-exporters, merchant-exporters

to’
supporting manufacturers and service providers are
eligible for this scheme.

‘tied

(c) P r a c t i c a l

i m p l e m e n t a t i o n

(50) Under the condition of an export obligation, a company
is allowed to import capital goods (new and, since April
2003, secondhand capital goods up to 10 years old) at a
reduced rate of duty. To this end, the GOI issues, upon
application and payment of a fee, an EPCGS licence.
Since April 2000, the scheme provides for a reduced
import duty rate of 5 % applicable to all capital goods
imported under the scheme. Until 31 March 2000, an
effective duty rate of 11 % (including a 10 % surcharge)
and, in case of high value imports, a zero duty rate was
applicable. In order to meet the export obligation, the
imported capital goods must be used to produce a
certain amount of export goods during a certain period.

(51)

The EPCGS licence holder can also source the capital
goods indigenously. In such case, the indigenous manu­
facturer of capital goods may avail of the benefit for
duty-free import of components required to manufacture
such capital goods. Alternatively, the indigenous manu­
facturer can claim the benefit of deemed export
in
respect of supply of capital goods to an EPCGS licence
holder.

(d) D i s c l o s u r e c o m m e n t s

(52) Upon disclosure the sole cooperating exporting producer
submitted comments on EPCGS. The company claimed
that on the basis of the generally accepted accounting
principles capital goods are consumed in the production
process.
In this respect it is noted that the company
failed to substantiate this claim by explicitly mentioning
the so-called generally acceptable accounting principles
and providing an analysis in relation with the relevant
EPCGS provisions of the EXIM policy as well as the
consumed in the production
definition of
process, as set out in Annex II of the basic Regulation.
It also argued that the company’s depreciation period
should have been used as
the normal depreciation
period. Nevertheless, such an approach is contrary to
the relevant provision of Article 7(3) of the basic Regu­

inputs

lation. Therefore, these claims had to be rejected. Finally,
the company provided comments on a computation
error which was
and was
acknowledged in the calculation of the subsidy amount.

considered warrant

(e) C o n c l u s i o n o n E P C G S c h e m e

The EPCGS provides subsidies within the meaning of
Article 2(1)(a)(ii) and Article 2(2) of the basic Regulation.
The duty reduction constitutes a financial contribution by
the GOI, since this concession decreases the GOI’s duty
revenue, which would be otherwise due. In addition, the
duty reduction confers a benefit upon the exporter,
because the duties saved upon importation improve its
liquidity.

the EPCGS is contingent

in law upon
Furthermore,
since such licences cannot be
export performance,
obtained without a commitment to export. Therefore, it
is deemed to be specific and countervailable under
Article 3(4)(a) of the basic Regulation.

system

scheme

can not be

system or
the

Eventually,
this
considered a
permissible duty drawback
substitution
of
within
drawback
Article 2(1)(a)(ii) of the basic Regulation. Capital goods
are not covered by the scope of such permissible systems,
as set out in Annex I point (i) of the basic Regulation,
because they are not consumed in the production of the
exported products.

meaning

(f) C a l c u l a t i o n o f

t h e s u b s i d y a m o u n t

the benefit over

the full value of

The subsidy amount was calculated, in accordance with
Article 7(3) of the basic Regulation, on the basis of the
unpaid customs duty on imported capital goods spread
across a period which reflects the normal depreciation
period of such capital goods in the antibiotics industry.
In accordance with the established practice, the amount
so calculated, which is attributable to the RIP, has been
adjusted by adding interest during this period in order to
reflect
time. The
commercial interest rate during the review investigation
period in India was considered appropriate for
this
purpose. Where justified claims were maid, fees neces­
sarily incurred to obtain the subsidy were deducted in
accordance with Article 7(1)(a) of the basic Regulation
from this sum to arrive at
the subsidy amount as
nominator. In accordance with Article 7(2) and 7(3) of
this subsidy amount has been
the basic Regulation,
turnover during the RIP as
allocated over the export
appropriate
is
the
denominator,
contingent upon export performance and it was not
granted by reference to the quantities manufactured,
produced, exported or transported.

because

subsidy

29.11.2008

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Official Journal of the European Union

L 319/9

(57)

The subsidy rate established in respect of this scheme
during the RIP for
the sole cooperating exporting
producer amounts to 0,1 %.

4. Export Credit Scheme (ECS)

(a) L e g a l b a s i s

(58)

The details of the scheme are set by in Master Circular
DBOD No DIR.(Exp). BC 01/04.02.02/2007-08 of the
Reserve Bank of India (RBI), which is addressed to all
commercial banks in India.

(b) E l i g i b i l i t y

(59) Manufacturing exporters and merchant exporters are

eligible for this scheme.

rates

the one used on Indian rupee credit. In this respect it is
noted that both Indian rupee and foreign currency export
credit form part of the same RBI Master Circular, with
the practical implementations described under recitals 60
and 61, whose detailed and restrictive provisions demon­
strates that foreign currency export credit funding and
interest
levied are linked to clear government
imposed directives. As regards to the benchmark rate,
it is noted that this was reported by the company on
in line with the relevant
its Indian rupee credit and,
policies of the RBI Master Circular, exporters have the
ability to freely pass for the same export transaction from
rupee credit to foreign currency credit.
It is therefore
considered appropriate to use as benchmark the only
Indian
rate reported by the company as its normal
interest rate. Therefore, those claims had to be rejected.
Finally, the company provided comments on a compu­
tation error which was considered warrant and was
acknowledged in the calculation of the subsidy amount.

(c) P r a c t i c a l

i m p l e m e n t a t i o n

(63)

(60) Under this scheme, the RBI mandatorily sets maximum
ceiling interest rates applicable to export credits, both in
Indian rupees or in foreign currency, which commercial
banks can charge an exporter. The ECS consists of two
the Pre-Shipment Export Credit Scheme
sub-schemes,
(packing credit), which covers credits provided to an
exporter for financing the purchase, processing, manufac­
turing, packing and/or shipping of goods prior to export,
and the Post-Shipment Export Credit Scheme, which
provides for working capital loans with the purpose of
financing export receivables. The RBI also directs the
banks to provide a certain amount of their net bank
credit towards export finance.

(e) C o n c l u s i o n o n t h e E C S

The preferential interest rates of an ECS credit set by the
RBI Master Circular mentioned in recital 58 can decrease
interest costs of an exporter as compared with credit
costs purely set by market conditions and confer in
this case a benefit in the meaning of Article 2(2) of
the basic Regulation on such exporter. Export financing
is not per se more secure than domestic financing. In
fact, it is usually perceived as being more risky and the
extent of security required for a certain credit, regardless
of the finance object, is a purely commercial decision of
a given commercial bank. Rate differences with regard to
different banks are the result of the methodology of the
RBI to set maximum lending rates for each commercial
bank individually. In addition, commercial banks would
not be obliged to pass through to borrowers of export
financing any more advantageous interest rates for export
credits in foreign currency.

credits

at preferential

(61) As a result of the RBI Master Circular, exporters can
rates
obtain export
compared with the interest rates for ordinary commercial
credits (cash credits), which are set purely under market
conditions. The difference in rates might decrease for
companies with good credit ratings. In fact, high rating
companies might be in a position to obtain export
credits and cash credits at the same conditions.

interest

(d) D i s c l o s u r e c o m m e n t s

(62) Upon disclosure the sole cooperating exporting producer
submitted comments on ECS. The company argued that
(i) there is no public funding into the granting of export
credit in foreign currency;
its low rates in foreign
(ii)
currency export credit was due to the company’s high
credit rating; and (iii) the interest rate used as benchmark
on foreign currency credit should not be the same with

it

context,

(64) Despite the fact that the preferential credits under the
ECS are granted by commercial banks, this benefit is a
financial contribution by a government within the
meaning of Article 2(1)(a)(iv) of the basic Regulation.
In this
should be noted that neither
Article 2(1)(a)(iv) of the basic Regulation nor the ASCM
require a charge on the public accounts, e.g. reimbur­
sement of
to
establish a subsidy, but only government direction to
carry out functions illustrated in points (i),
(ii) or (iii)
of Article 2(1)(a) of the basic Regulation. The RBI is a
public body and falls therefore under the definition of a
‘government’ as set out in Article 1(3) of the basic Regu­
It is 100 % government-owned, pursues public
lation.
policy
its
e.g. monetary
objectives,
management is appointed by the GOI. The RBI directs

the commercial banks by the GOI,

policy,

and

L 319/10

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Official Journal of the European Union

29.11.2008

inter

towards export

commercial banks

private bodies, within the meaning of the second indent
of Article 2(1)(a)(iv) of the basic Regulation, since the
commercial banks are bound by the conditions
it
imposes,
alia, with regard to the maximum
ceilings for interest rates on export credits mandated in
the RBI Master Circular and the RBI provisions that
commercial banks have to provide a certain amount of
finance. This
their net bank credit
to carry out
direction obliges
the basic
functions mentioned in Article 2(1)(a)(i) of
Regulation, in this case loans in the form of preferential
export financing. Such direct transfer of funds in the
form of loans under certain conditions would normally
be vested in the government, and the practice, in no real
from practices normally followed by
sense, differs
governments, within the meaning of Article 2(1)(a)(iv)
of the basic Regulation. This subsidy is deemed to be
and
specific
the preferential
rates are only available in relation to the
interest
therefore
financing of
contingent upon export performance, pursuant
to
Article 3(4)(a) of the basic Regulation.

countervailable

transactions

and are

export

since

(65)

(f) C a l c u l a t i o n o f

t h e s u b s i d y a m o u n t

cooperating

exporting producer. This

The subsidy amount has been calculated on the basis of
the difference between the interest paid for export credits
used during the RIP and the interest rate that would have
been payable for ordinary commercial credits used by the
sole
subsidy
amount (nominator) has been allocated over the total
appropriate
export
denominator
the
basic Regulation, because the subsidy is contingent
upon export performance and it was not granted by
reference to the quantities manufactured, produced,
exported or transported.

the RIP
in accordance with Article 7(2) of

turnover

during

as

(66)

The subsidy rate established with regard to this scheme
for the RIP for the sole cooperating exporting producer
amounts to 1,3 %.

5. Income Tax Schemes

(a) I n c o m e T a x E x e m p t i o n S c h e m e ( I T E S )

Section 80HHC of the Income Tax Act 1961 (ITA)

to 31 March 2005) onwards and thus 80HHC of the ITA
does not confer any benefits after 31 March 2004. The
sole cooperating exporting producer did not avail of any
benefits under this scheme during the RIP. Consequently,
since the scheme has been withdrawn, it shall therefore
not be countervailed, in accordance with Article 15(1) of
the basic Regulation.

(b) I n c o m e T a x

I n c e n t i v e

f o r R e s e a r c h

a n d D e v e l o p m e n t

( I T I R A D )

(i) Legal basis

(69)

The detailed description of the ITIRAD is set out
section 35(2AB) of the ITA.

in

(ii) Eligibility

(70)

Companies engaged in the business of biotechnology or
manufacture or production of drugs, pharmaceuticals,
chemicals, electronic equipments, computers, telecommu­
nication equipments, chemicals or any other article or
thing as may be notified are eligible for benefits under
this scheme.

(iii) Practical implementation

(71)

For any expenditure (other than cost of land or building)
on in-house research and development
facilities as
approved by the Department of Scientific and Industrial
Research of the GOI, a deduction of a sum equal to
150 % of the costs de facto incurred is permitted for
income tax purposes. Thus, by means of a 50 %
expenses not
deduction of
actually incurred), the income tax base and subsequently
the income tax burden decreases artificially.

expenses

fictional

(i.e.

(iv) Disclosure comments

(72) No comments with respect to ITIRAD were submitted

upon disclosure.

(67) Under this scheme exporters could avail the benefit of a
partial
income tax exemption on profits derived from
export sales. The legal basis for this exemption was set
by Section 80HHC of the ITA.

(73)

(68)

This provision was abolished for the assessment year
2005/06 (i.e. for the financial year from 1 April 2004

(v) Conclusion on ITIRAD

The ITIRAD provides subsidies within the meaning of
Article 2(1)(a)(ii) and Article 2(2) of the basic Regulation.
income tax base reduction under section
The artificial
35(2AB) of the ITA constitutes a financial contribution
by the GOI, since this decreases the GOI’s income tax
revenue which would be otherwise due. In addition, the
income
tax reduction confers a benefit upon the
company, because it improves its liquidity.

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Official Journal of the European Union

L 319/11

(74)

The wording of section 35(2AB) ITA proves that ITIRAD
is, de jure, specific in the meaning of Article 3(2)(a) of
the basic Regulation and therefore countervailable. El-
igibility for this scheme is not governed by objective
criteria, which are neutral within the meaning of
Article 3(2)(b) of the basic Regulation. Benefits under
this
scheme are only available to certain industries
since the GOI has not made this scheme available to
all sectors. Such limitation constitutes specificity, since
the category ‘group of industries’ in Article 3(2) of the
basic
sector
synonymously
restrictions. This restriction is not economic in nature
and horizontal
in application such as a restriction on
the number of employees or size of enterprise.

Regulation

describes

(vi) Calculation of the subsidy amount

(75)

The subsidy amount has been calculated on the basis of
the difference between the income tax due for the review
investigation period with and without the application of
the provision of section 35(2AB) of the ITA. This subsidy
amount (nominator) has been allocated over the total
turnover during the RIP as appropriate denominator in
accordance with Article 7(2) of
the basic Regulation,
because this subsidy relates to all sales, domestic and
export, and it was not granted by reference to the quan­
tities manufactured, produced, exported or transported.

(76)

The subsidy rate established with regard to this scheme
during the RIP for
the sole cooperating exporting
producer amounts to 0,1 %.

6. Focus Market Scheme (FMS)

(a) L e g a l b a s i s

(77)

the FMS is contained in
The detailed description of
chapter 3.9 of the EXIM policy 04-09 and in chapter
3.20 of the HOP I 04-09.

entitled to duty credit equivalent to 2,5 % of the FOB
value of products exported under this scheme. Certain
type of export activities are excluded from the scheme,
e.g. exports of imported goods or transhipped goods,
deemed exports, service exports and export turnover of
units operating under special economic zones/export
operating units. Also excluded from the scheme are
certain types of products,
e.g. diamonds, precious
metals, ores, cereals, sugar and petroleum products.

(80)

The duty credits under FMS are freely transferable and
valid for a period of 24 months from the date of issue of
the relevant credit entitlement certificate. They can be
used for payment of custom duties on subsequent
imports of any inputs or goods including capital goods.

(81)

The credit entitlement certificate is issued from the port
from which the exports have been made and after
realisation of exports or shipment of goods. As long as
the applicant provides to the authorities copies of all
relevant
export order,
documentation (e.g.
invoices, shipping bills, bank realisation certificates), the
GOI has no discretion over the granting of the duty
credits.

export

(d) D i s c l o s u r e c o m m e n t s

(82) Upon disclosure the sole cooperating exporting producer
submitted comments on FMS. The company argued that
the scheme is geographically related to other countries
and cannot be countervailed by EC. Nevertheless, it was
not able to dispute neither the practical implementations
of the scheme nor the way the FMS benefit is used, as
stated under recitals 79 to 81. Therefore, this claim had
to be rejected. Finally, the company provided comments
on a computation error which was considered warrant
and was acknowledged in the calculation of the subsidy
amount.

(b) E l i g i b i l i t y

(78) Any manufacturer-exporter or merchant-exporter

is

eligible for this scheme.

(e) C o n c l u s i o n o n F M S

(c) P r a c t i c a l

i m p l e m e n t a t i o n

(79) Under this scheme exports of all products to countries
notified under Appendix 37(C) of HOP I 04-09 are

(83)

The FMS provides
subsidies within the meaning of
Article 2(1)(a)(ii) and Article 2(2) of the basic Regulation.
A FMS duty credit is a financial contribution by the GOI,
since the credit will eventually be used to offset import
duties, thus decreasing the GOI’s duty revenue which
would be otherwise due.
the FMS duty
credit confers a benefit upon the exporter, because it
improves its liquidity.

In addition,

L 319/12

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Official Journal of the European Union

29.11.2008

Furthermore, the FMS is contingent in law upon export
performance, and therefore deemed to be specific and
countervailable under Article 3(4)(a) of the basic Regu­
lation.

(86)

(84)

(85)

in place

This scheme cannot be considered a permissible duty
substitution drawback system
drawback system or
within the meaning of Article 2(1)(a)(ii) of
the basic
Regulation. It does not conform to the strict rules laid
down in Annex I point (i), Annex II (definition and rules
(definition and rules for
for drawback) and Annex III
substitution drawback) of
the basic Regulation. An
exporter is under no obligation to actually consume
the goods imported free of duty in the production
process and the amount of credit is not calculated in
inputs used. There is no system or
relation to actual
procedure
are
to confirm which inputs
the exported
consumed in the production process of
import
product or whether an excess payment of
duties occurred within the meaning of point
(i) of
Annex I and Annexes II and III of the basic Regulation.
An exporter is eligible for the FMS benefits regardless of
whether it imports any inputs at all. In order to obtain
the benefit,
for an exporter to simply
export goods without demonstrating that any input
material was
imported. Thus, even exporters which
procure all of their inputs locally and do not import
any goods which can be used as inputs are still entitled
to benefit from the FMS. Moreover, an exporter can use
the FMS duty credits in order to import capital goods
although capital goods are not covered by the scope of
permissible duty drawback systems, as set out in Annex I
point (i) of the basic Regulation, because they are not
consumed in the production of the exported products.

is sufficient

it

(f) C a l c u l a t i o n o f

t h e s u b s i d y a m o u n t

The amount of countervailable subsidies was calculated
in terms of the benefit conferred on the recipient, which
is found to exist during the RIP as booked by the coop­
erating exporting producer on an accrual basis as income
at the stage of export transaction. In accordance with
Article 7(2) and 7(3) of
the basic Regulation this
subsidy amount
(nominator) has been allocated over
turnover during the RIP as appropriate
the export
denominator, because the subsidy is contingent upon
export performance
granted by
reference to the quantities manufactured, produced,
exported or transported.

and it was not

(87)

The subsidy rate established with regard to this scheme
during the RIP for
the sole cooperating exporting
producer amounts to 0,1 %.

III. Amount of countervailable subsidies

(88)

It is recalled that in Regulation (EC) No 713/2005 the
amount of countervailable subsidies, expressed ad valorem,
was found to be 35,1 % for the sole exporting producer
cooperating with the present partial interim review.

(89) During the present partial interim review the amount of
countervailing subsidies, expressed ad valorem, was fount
to be 11,9 %, as listed hereunder:

SCHEME

AAS

DEPBS

EPCGS

COMPANY

Ranbaxy Laboratories Ltd

%

8,2

%

2,1

%

0,1

ECS

%

1,3

ITIRAD

%

0,1

FMS

%

0,1

Total

%

11,9

(90) Account taken of the above it is concluded that the level
of subsidisation with regard to the sole cooperating
exporting producer has decreased.

(92)

IV. Countervailing measures

(91)

this partial

In line with the provisions of Article 19 of the basic
Regulation and the grounds of
interim
review stated under point 3 of the notice of initiation,
it is established that the level of subsidisation with regard
to the sole cooperating producer has decreased from
35,1 % to 11,9 % and, therefore, the rate of counter­
imposed to this exporting producer by
vailing duty,
Regulation (EC) No 713/2005 has
to be amended
accordingly.

In this respect, it is recalled that under Regulation (EC)
No 713/2005 the subsidy rate of Ranbaxy Laboratories
Ltd was higher than the injury elimination level.
In
accordance with Article 15(1) of the basic Regulation,
the lesser duty reflecting the injury elimination level
was considered adequate
to remove injury to the
Community industry and thus the rate of countervailing
duty applicable to imports from Ranbaxy Laboratories
Ltd was set to 30,3 %.

(93) Account taken of the above and given that the subsidies
rate is now lower than the injury elimination level, the
individual company countervailing duty rate applicable to
the
exporting producer, Ranbaxy
cooperating
Laboratories Ltd, is set at 11,9 %.

sole

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Official Journal of the European Union

L 319/13

interim review,

the actual modalities of

that did not
(94) With regard to all other companies
it is
cooperate with the present partial
noted that
the investigated
schemes and their countervailability have not changed
with respect to the previous investigation. Thus there is
no reason to re-calculate the subsidy and duty rates of
the companies that did not cooperate with the present
partial interim review. Consequently, the rates of the duty
applicable to all other parties except Ranbaxy Labora­
tories Ltd mentioned under Article 1(2) of Regulation
(EC) No 713/2005 remain unchanged.

(95)

company

individual

countervailing duty

The
rates
specified in this Regulation reflect the situation found
during the partial
interim review. Thus, they are solely
applicable to imports of the product concerned produced
by these companies. Imports of the product concerned
manufactured by any other company not specifically
this Regulation,
mentioned in the operative part of
including
specifically
mentioned, cannot benefit
from these rates and shall
to the duty rate applicable to ‘all other
be subject
companies’.

entities

related

those

to

(96) Any claim requesting the application of these individual
countervailing duty rates (e.g. following a change in the
name of the entity or following the setting up of new
production or sales entities) should be addressed to the
Commission (1) forthwith with all relevant information,
in particular any modification in the company’s activities
linked to production, domestic and export sales associ­
ated with, for instance, that name change or that change
in the production and sales entities. If appropriate, and
after
the
Commission is hereby empowered to amend the Regu­
lation accordingly by updating the list of companies
benefiting from individual duty rates,

the Advisory Committee,

consultation of

HAS ADOPTED THIS REGULATION:

Article 1

Paragraph 2 of Article 1 of Regulation (EC) No 713/2005 shall
be replaced by the following:

The

rate of duty applicable
before
price,

‘2.
free-at-
Community-frontier
imports
produced in India by the companies listed below, shall be
as follows:

to the net
duty

for

— 17,3 % for KDL Biotech Ltd, Mumbai (TARIC additional

code: A580),

— 28,1 % for Nectar Lifesciences Ltd, Chandigarh (TARIC

additional code: A581),

— 25,3 % for Nestor Pharmaceuticals Ltd, New Delhi (TARIC

additional code: A582),

— 11,9 % for Ranbaxy Laboratories Ltd, New Delhi (TARIC

additional code: 8221),

— 28,1 % for Torrent Gujarat Biotech Ltd, Ahmedabad

(TARIC additional code: A583),

— 28,1 % for Surya Pharmaceuticals Ltd, Chandigarh (TARIC

additional code: A584),

— 32 % for all other companies (TARIC additional code:

8900).’

Article 2

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

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

Done at Brussels, 27 November 2008.

For the Council
The President

M. ALLIOT-MARIE

(1) European Commission — Directorate-General for Trade — Direc­
torate B — J-79 4/23 — Rue de la Loi/Wetstraat 200 — B-1049
Brussels.