Proposal for a Council Regulation imposing a definitive anti-dumping duty and collecting definitively the provisional duty imposed on imports of certain candles, tapers and the like originating in the People’s Republic of China
Date: 2009-04-21
Institutions: European Commission
Subjects: China, anti-dumping duty, disclosure of information, import, lighting equipment, originating product, production, trade-mark law

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COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 21.4.2009 
COM(2009) 190 final 

Proposal for a 

COUNCIL REGULATION 

imposing a definitive anti-dumping duty and collecting definitively the provisional duty 
imposed on imports of certain candles, tapers and the like originating in the People’s 
Republic of China 

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EXPLANATORY MEMORANDUM 

1. 

Context of the proposal 

Grounds for and objectives of the proposal 

This  proposal  concerns  the  application  of  Council  Regulation  (EC)  No  384/96  of 
22 December 1995 on protection against dumped imports from countries not members 
of  the  European  Community(‘the  basic  Regulation’)  in  the  proceedings  concerning 
imports of certain candles, tapers and the like originating in the People’s Republic of 
China. 

General context 

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

Existing provisions in the area of the proposal 

Not applicable. 

Consistency with other policies and objectives of the Union 

Not applicable. 

2. 

Consultation of interested parties and impact assessment 

Consultation of interested parties 

Interested parties concerned by the proceeding have had the possibility to defend their 
interests during the investigation, in line with the provisions of the basic Regulation. 

Collection and use of expertise 

There was no need for external expertise. 

Impact assessment 

This proposal is the result of the implementation of the basic Regulation. 

The  basic  Regulation  does  not  foresee  a  general  impact  assessment  but  contains  an 
exhaustive list of conditions that have to be assessed. 

3. 

Legal elements of the proposal 

Summary of the proposed action 

On  16  February  2008,  the  Commission  initiated  an  anti-dumping  proceeding 
concerning  imports  of  certain  candles,  tapers  and  the  like  originating  in  the  People’s 
Republic of China. 

The investigation found dumping of the product concerned, which caused injury to the 
Community  industry.  The  investigation  also  found  that  it  was  not  against  the 
Community  interest  to  impose  anti-dumping  measures.  On  this  basis,  provisional 
measures  were  imposed  by  Commission  Regulation  (EC)  No  1130/2008.  The 

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continuation of the investigation has confirmed the essential provisional findings. 

Therefore, it is proposed that the Council adopts the attached proposal for a Regulation 
in order to impose definitive measures. 

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 because the form of action is 
described  in  the  above-mentioned  basic  Regulation  and  leaves  no  scope  for  national 
decision. 

Indication  of  how  financial  and  administrative  burden  falling  upon  the  Community, 
national governments, regional and local authorities, economic operators and citizens is 
minimized and proportionate to the objective of the proposal is not applicable. 

Choice of instruments 

Proposed instrument: Regulation. 

Other  means  would  not  be  adequate  because  the  basic  Regulation  does  not  foresee 
alternative options. 

4. 

Budgetary implication 

The proposal has no implication for the Community budget. 

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Proposal for a 

COUNCIL REGULATION 

imposing a definitive anti-dumping duty and collecting definitively the provisional duty 
imposed on imports of certain candles, tapers and the like originating in the People’s 
Republic of China 

THE COUNCIL OF THE EUROPEAN UNION, 

Having regard to the Treaty establishing the European Community,  

Having  regard  to  Council  Regulation  (EC)  No  384/96  of  22  December  1995  on  protection 
against dumped imports from countries not members of the European Community1 (the 'basic 
Regulation'), and in particular Article 9 thereof, 

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

Whereas: 

1. 

1.1. 

(1) 

1.2. 

(2) 

(3) 

(4) 

PROCEDURE 

Provisional measures 
The  Commission,  by  Regulation  (EC)  No  1130/20082  (the  'provisional  Regulation') 
imposed a provisional anti-dumping duty on imports of certain candles, tapers and the 
like originating in the People's Republic of China ('PRC'). 

Subsequent procedure 

Subsequent to the disclosure of the essential facts and considerations  on the basis of 
which  it  was  decided  to  impose  provisional  anti-dumping  measures  ('provisional 
disclosure'),  several  interested  parties  made  written  submissions  making  their  views 
known  on  the  provisional  findings.  The  parties  who  so  requested  were  granted  an 
opportunity to be heard. The Commission continued to seek and verify all information 
it deemed necessary for its definitive findings. 

The  Commission  continued  its  investigation  with  regard  to  Community  interest 
aspects and carried out further analysis of information provided by importers, retailers 
and trade associations in the Community after the imposition of the provisional anti-
dumping measures.  

The  oral  and  written  comments  submitted  by  the  interested  parties  were  considered 
and,  where  appropriate,  the  provisional  findings  were  modified  accordingly.  To  this 
end further verification visits were carried out at the following companies: 

Unrelated importers in the Community:  

–  Koopman International BV, Amsterdam, Netherlands 

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2 

OJ L 56, 6.3.1996, p.1 
OJ L 306, 15.11.2008, p. 22. 

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(5) 

(6) 

(7) 

(8) 

–  Salco Group PLC, Essex, UK 

Verification visits were also carried out at the premises of the companies mentioned 
in recital (31) below. 

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 
measures on imports of certain candles, tapers and the like originating in the PRC and 
the definitive collection of the amounts secured by way of the provisional duty. They 
were also granted a period within which they could make representations subsequent 
to this disclosure. 

It is recalled that the investigation of dumping and injury  covered the  period from 1 
January 2007 to 31 December 2007 ('investigation period' or 'IP'). With respect to the 
trends relevant for the injury assessment, the Commission analysed data covering the 
period from 2004 to the end of the IP ('period considered'). 

Some interested parties argued that the choice of the year 2007 as investigation period 
was  flawed  because  certain  events,  such  as  changing  export  subsidy  and  labour 
policies  of  PRC,  and  fluctuations  in  exchange  rates,  which  took  place  in  2007  and 
2008, played a role in the injury analysis.  

It  should  be  noted  that  according  to  Article  6(1)  of  the  basic  Regulation  the 
investigation  period  should  cover  a  period  immediately  prior  to  the  initiation  of  the 
proceeding.  It  is  recalled  that  the  present  investigation  was  initiated  on  16  February 
2008.  As  to  the  examination  of  trends  relevant  for  the  assessment  of  injury,  this 
normally covers three or four years prior to initiation, ending in line with the dumping 
investigation period. Consequently, the claim was rejected. 

(9) 

One  interested  party  contested  the  percentage  mentioned  in  recital  (2)  of  the 
provisional Regulation which represents the complainants in terms of total Community 
production.  

(10)  After examination of the claim, it should be noted that the figure of 60% indicated in 
recital  (2)  of  the  provisional  Regulation  refers  to  the  overall  support  for  the 
investigation,  including  complainants  and  Community  producers  who  supported  the 
complaint and agreed to cooperate in the investigation, rather than to the percentage of 
the  Community  production  covered  by  the  complainants  only.  This  is  confirmed  by 
recital  (92)  of  the  provisional  Regulation.  As  to  the  percentage  in  recital  (2)  of  the 
provisional Regulation, this should read "34%".  

2. 

PRODUCT CONCERNED AND LIKE PRODUCT 

2.1. 

Product concerned 

(11)  The  product  concerned  was  provisionally  defined  as  certain  candles,  tapers  and  the 
like, other than memory lights and other outdoor burners, exported to the Community 
and originating in the PRC ('candles' or 'product concerned').  

(12)  For  the  purpose  of  imposing  provisional  measures,  although  the  various  types  of 
candles could differ in size, shape, colour, and other features such as the scent, etc., it 
was considered that all the types of candles included in the definition of the product 
concerned  share  the  same  basic  chemical  and  technical  characteristics  and  uses  and 
they would be to a large extent interchangeable.  

(13)  Comments  made  at  that  time  by  interested  parties  did  not  justify  the  exclusion  of 
certain types of candles from the scope of the investigation, in particular the so called 

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'fancy'  or  'decorative'  candles.  The  parties  did  not  make  any  submission  identifying 
dividing  features  which  would  have  allowed  to  clearly  distinguishing  between  the 
various  types  of  candles  which  should  be  included  and  those  which  should  be 
excluded  from  the  scope  of  the  investigation. In  addition,  contrary  to  certain  claims, 
the investigation did not point to findings of dumping and injury within the sampled 
companies investigated varying significantly according to the types of candles. It was 
therefore  provisionally  considered  that  all  candle  types  covered  by  the  present 
investigation  were  part  of  the  same  product  and  should  be  covered  by  the 
investigation.  

(14)  Following the imposition of provisional measures, it was claimed again that exporting 
producers in the PRC were producing to a large extent handmade or decorative candles 
with  further  refining  operations.  It  was  repeated  that  they  were  labour  intensive  and 
that  they  were  produced  in  limited  quantities  by  Community  producers.  It  was  also 
reiterated  that  the  customer  perception  towards  decorative  candles  was  different 
compared to classical and standard types of candles. For example, it was argued that 
unlike  classical  candles,  decorative  types  are  not  destined  to  be  burned  or  used  to 
provide  heat  but  were  intended  to  be  kept  as  decorative  items  as  long  as  possible 
unaltered.  

(15) 

It was also claimed that it would be relatively easy to discern decorative candles from 
other types of candles, such as tea-lights and tapered candles, taking into account that 
decorative  candles  have  at  least  one  of  the  following  features:  (i)  are  multicoloured 
and  have  multiple  layers;  (ii)  have  special  shapes;  (iii)  have  carved  surface  with 
decorations and (iv) have additional decorations of material other than wax/paraffin. 

(16)  Other  interested  parties  claimed  that  'birthday'  candles  are  not  manufactured  in  the 
Community but almost exclusively in the PRC and should therefore also be excluded 
from the present proceeding.  

(17) 

It was also argued that the so-called tea-lights could replace candles for the purpose of 
producing light, but other types of candles could not replace tea-lights for the purpose 
of producing heat. Therefore these two product types would lack interchangeability as 
it is the case between memory lights and other outdoor burners which are not part of 
the product concerned and other types of candles including tea-lights. Consequently it 
was claimed that tea-lights should also be excluded from the present proceeding.  

(18)  Concerning the claim on decorative candles, the distinguishing features mentioned by 
the  parties  are  very  general  and  would  not  allow  for  a  clear  distinction  to  be  made 
between  the  types  of  candles  which  should  be  included  and  those  that  should  be 
excluded from the scope of the investigation and not made subject to measures. Many 
standard types of candles have more than one colour, they may have a specific shape 
or  one  or  more  additional  decorations,  for  example  on  the  occasion  of  specific 
celebrations during the year. In addition, the information provided by the parties and 
collected in the investigation, in particular on the product types and the product control 
numbers as they were defined, would not always allow for a clear distinction between 
the various types of candles based on the above-mentioned features. It should be firstly 
noted  that  the  fact  that  certain  product  types  are,  allegedly,  not  produced  by 
Community  producers  would  not  automatically  lead  to  the  exclusion  of  these  types 
from  the  definition  of  the  product  concerned.  Secondly,  it  cannot  be  ruled  out  that 
certain  types  of  candles  are  not  produced  by  Community  producers  because  of 
injurious dumping. In the case of the so-called birthday candles, the parties concerned 
did not provide any evidence that these types of candles were actually not produced in 

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the  Community,  nor  did  they  explain  the  reasons  why  such  candles  would  not  be 
produced in the Community. In addition, as is the case for the decorative candles, no 
clear dividing lines between the birthday candles and the other types of candles were 
provided to allow an eventual exclusion of these product types. These comments are 
also valid for the so-called handmade candles. It is noteworthy, that as mentioned in 
recital  (26)  below,  the  claim  that  handmade  candles  are  not  produced  in  the 
Community was not correct.  

(19)  Concerning  the  claim  made  on  the  use  of  certain  candles  types,  namely  to  produce 
light and/or heat, it is recalled that in recital (26) of the provisional Regulation it was 
mentioned  that  interchangeability  between  various  types  of  candles  existed  and  that 
candles  were  largely  used  for  interior  decoration  purposes  and  not  for  the  main 
purpose of producing heat. No information which would contradict this statement was 
provided  by  parties.  Concerning  the  claims  made  on  memory  lights  and  outdoor 
candles,  it  is  confirmed  that  these  products  can  be  distinguished  from  other  types  of 
candles on the basis of the technical and chemical criteria mentioned in recital (17) of 
the provisional Regulation.  

(20) 

In  summary,  it  was  considered  that  the  claims  made  by  the  parties  were  not 
sufficiently  specific  and  were  not  supported  by  substantiating  evidence  showing  that 
the  product  concerned  was  not  correctly  defined  in  the  provisional  Regulation.  It  is 
recalled  that  all  types  of  candles  included  in  the  product  concerned  share  the  same 
basic  chemical  and  technical  characteristics.  In  addition,  in  the  present  case,  it  was 
found  that  candles  had  the  same  or  similar  uses  and  that  they  are  in  many  instances 
interchangeable. They are produced by candle producers in the PRC and exported via 
the same sales channels and are thus part of the same product. 

(21) 

In  the  absence  of  any  further  comments  concerning  the  definition  of  the  product 
concerned, recitals (15) to (23) of the provisional Regulation are hereby confirmed. 

2.2. 

Like product 

(22)  Certain  parties  contested  the  findings  made  in  recital  (28)  of  the  provisional 
Regulation where the criteria applied in the determination of the "like product" were 
mainly based on the technical and chemical characteristics, as well as the end uses or 
functions  of  the  product.  Other  factors,  such  as  the  shape,  scent,  colour  or  other 
features  stated  by  the  interested  party,  were  not  considered  to  be  relevant  for  the 
definition  of  the  like  product.  Indeed,  possible  variations  in  terms  of  size  have  no 
incidence on the definition of the product concerned and the like product, in particular 
because no clear distinction could be made between the product types belonging to the 
same product in relation to their main basic technical and chemical characteristics, to 
the end use and to the perception of the users. 

(23) 

In this context, it should be underlined that the parties did not contest the fact that all 
types of candles share the same basic chemical and technical characteristics or that all 
types  of  candles  are  all  made  of  the  same  raw  material,  mainly  wax,  that  they  are 
produced  by  the  same  producers  and  upon  export  they  are  sold  via  the  same  sales 
channels or to similar customers on the Community market.  

(24)  The  main  arguments  made  by  interested  parties  relied  on  the  fact  that  the  types  of 
candles produced in the PRC and exported to the Community are not alike to the types 
manufactured in the Community by Community producers. All claims were carefully 
examined,  but  did  not  provide  any  new  substantial  element  in  comparison  to  the 
claims made and addressed at provisional stage. 

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(25)  The claim made in recital (14) above for the definition of the product concerned was 
also made in the context of the like product. It was argued that exporting producers in 
the  PRC  are  producing  to  a  large  extent  handmade,  or  labour-intensive  decorative 
candles  with  further  refining  operations  and  various  different  shapes  which  are  not 
produced  or  produced  in  limited  quantities  by  Community  producers.  Hence,  it  was 
claimed  that  these  types  of  candles  are  not  like  those  produced  by  Community 
producers.  

(26)  The investigation has shown that this statement was not correct. Whilst the producers 
included  in  the  definition  of  the  Community  industry  may  be  concentrating  on  the 
standard candles segment of the market, available information indicate that there are a 
large number of producers in the Community which are producing decorative candles, 
including  handmade  and  labour-intensive  candles,  in  certain  Member  States,  such  as 
Estonia, France, Germany, Greece, Italy, Poland and Slovenia. 

(27) 

3. 

3.1. 

(28) 

In  view  of  the  claims  made  and  the  evidence  provided  by  interested  parties  and  all 
other  information  available  from  the  investigation,  it  is  considered  that  the  product 
concerned and candles produced and sold by the exporting producers on their domestic 
market and by producers in the Community, which also served as an analogue country 
for  the  purpose  of  establishing  the  normal  value  with  respect  to  the  PRC,  could  be 
considered  as  like  products  in  accordance  with  Article  1(4)  of  the  basic  Regulation. 
These products have essentially the same basic technical and chemical characteristics 
and the same or similar basic uses.  

SAMPLING 

Sampling of Community producers, importers and exporting producers in the PRC  

In  the  absence  of  any  comments  concerning  the  sampling  of  Community  producers, 
importers  and  exporting  producers  in  the  PRC,  which  would  alter  the  provisional 
findings, recitals (31) to (40) of the provisional Regulation are hereby confirmed. 

3.2. 

Individual examination  

(29)  As  indicated  in  recitals  (41)  to  (43)  of  the  provisional  Regulation  a  request  for 
individual examination ('IE') pursuant to Article 17(3) of the basic Regulation by one 
exporting  producer  could  not  be  accepted  at  provisional  stage  as  it  would  have 
prevented the timely completion of the investigation at that stage.  

(30)  However, in the circumstances of the case, it was considered administratively possible 
to  satisfy  this  sole  substantiated  request  after  the  imposition  of  the  provisional 
measures. 

(31)  Therefore,  a  verification  visit  was  carried  out  at  the  premises  of  the  following 

company in the PRC:  

– 

M.X. Candles and Gifts (Taicang) Co., Ltd, Taicang. 

Moreover, verification visits were carried out to its following related importers in the 
Community:  

– 

– 

Mueller Fabryka Swiec S.A, Grudziadz, Poland, 

Gebr. Muller Kerzenfabrik AG, Straelen, Germany. 

4. 

DUMPING 

4.1. 

Application of Article 18 of the basic Regulation  

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(32)  Subsequent to the provisional disclosure, the company to which Article 18 of the basic 
Regulation was applied contested the Commission findings. It essentially reiterated its 
claims  made  at  provisional  stage  without  providing  any  substantiated  evidence  that 
could justify changes to the provisional findings. 

(33) 

In  view  of  the  above,  recitals  (44)  to  (47)  of  the  provisional  Regulation  are  hereby 
confirmed.  

4.2. 

Market economy treatment ('MET')  

(34)  Following  the  provisional  disclosure,  five  Chinese  exporting  producers  which  were 

not granted MET contested the provisional findings.  

(35) 

In  the  case  of  the  exporter  that  could  not  demonstrate  that  it  met  criteria  1  and  3  of 
Article  2(7)(c)  of  the  basic  Regulation,  it  was  submitted  that  criterion  1  would  be 
fulfilled since a financial contribution received from the State to construct for instance 
a technology centre by a small and medium size company would also be available in 
market economy countries. It also claimed that in another anti-dumping case subsidies 
received by another company did not deprive the company of its MET status. 

(36)  With  regard  to  the  first  claim  it  has  to  be  noted  that  the  Community  institutions 
conduct  the  MET  assessment  on  the  basis  of  Article  2(7)(c)  of  the  basic  Regulation 
rather than on general comparisons of market conditions of companies operating in the 
PRC and firms operating in market economy countries. Therefore this claim had to be 
rejected. With regard to the second claim, it has to be underlined that the investigation 
of  each  anti-dumping  case  is  conducted  separately  and  that  the  conclusions  of  each 
investigation  are  drawn  in  the  context  and  circumstances  of  the  particular  case. 
Furthermore,  the  nature,  the  frequency  and  the  economic  environment  in  which  the 
State  contributions  were  given  in  the  present  case  showed  that  the  criterion  was  not 
fulfilled. Therefore the argument had to be rejected.  

(37)  The  same  exporter  claimed  that  in  relation  to  criterion  3  all  relevant  documents 
provided  would  have  demonstrated  that  the  price  paid  for  the  land  use  rights  would 
have been the result of a free negotiation with the local authorities and therefore, the 
price would be based on market values. 

(38) 

In  this  regard  it  has  to  be  noted  that  the  relevant  documents  on  which  the  purchase 
price of the land use rights were based date back to 1997 and enabled this exporter to 
acquire these rights for an indefinite period of time at a price fixed at that date. By not 
taking into account any price increase between 1997 and the actual transfer of the land 
use rights and in the absence of any land appraisal or evaluation report this exporter 
could  not  explain  on  what  basis  the  transfer  price  for  the  land  use  rights  was 
established.  

(39)  From the above it is concluded that for this exporter neither criteria 1 nor 3 of Article 
2(7)(c)  of  the basic Regulation are met and that therefore the conclusions reached at 
provisional stage have to be confirmed. 

(40)  One exporter that did not meet criterion 2 (mentioned in recital (53) of the provisional 
Regulation) claimed that it met this criterion since the financial contributions given to 
two members of the management should not be considered as "loans" contrary to what 
was established at provisional stage (recital (53) of the provisional Regulation), rather 
these contributions should be regarded as reserve funds. 

(41) 

In this regard it should be noted that a reserve fund is a type of account on a balance 
sheet that is reserved for long-term capital investments projects or any other large and 

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anticipated expenses that will be incurred in the future. Once recorded on the balance 
sheet,  these  funds  are  only  to  be  spent  on  the  capital  expenditure  projects  for  which 
they were initially intended, excluding any unforeseen circumstances. 

(42)  From the minutes of the Board of Directors meeting it is clear that such purposes were 
not intended. Moreover, the respective entries have been booked in the balance sheet 
account  "other  receivables"  which  is  normally  used  for  short  term  owner  and 
employee loans and advances. 

(43)  Therefore  it  can  be  concluded  that  the  financial  means  provided  to  two  individuals 
were not destined to serve as capital reserve, but to provide money without any proper 
legal  basis,  in  particular  without  a  contract  specifying  any  dates  of  repayments  or 
interests incurred. In any event such a transaction has to be considered as a financial 
instrument  within  the  meaning  of  IAS  32.  Moreover,  the  disclosure  of  these 
transactions  was not  made in  accordance with IAS 24, as the financial statements of 
the  company  did  not  disclose  i)  the  amount  of  transactions,  ii)  their  terms  and 
conditions, including whether they are secured, and iii) the nature of the consideration 
to be provided in the settlement and details of any guarantees given or received. 

(44)  From the above it is concluded that this exporter failed to meet criterion 2 of Article 
2(7)(c)  of  the  basic  Regulation  and  therefore  the  conclusions  reached  at  provisional 
stage are herewith confirmed. 

(45)  The other exporter that did not meet the requirements of criterion 2, did not contest the 
fact that errors in its accounting books took place but considered certain of them as of 
minor importance and certain others that took place in previous years of not having an 
effect on the clarity of the company's accounts. 

(46) 

In  this  regard  it  should  be  noted  that  the  mistakes  were  found  on  randomly  selected 
bookkeeping  documents  and  were  not  mentioned  by  the  auditors  in  the  audit  report 
which casts serious doubts as to whether the whole accounting records were audited in 
line  with  IAS.  In  addition,  the  erroneous  booking  of  fixed  assets  in  previous  years 
continues  to  distort  the  cost  structure  of  the  company  and  cannot  be  considered  as 
being in line with IAS 1 and 38.  

(47)  Consequently the determination made at provisional stage that this exporting producer 
did not meet criterion 2 of Article 2(7)(c) of the basic Regulation is hereby confirmed. 

(48)  The  co-operating  exporter  whose  MET  claim  was  rejected  because  it  could  not 
demonstrate that it met criterion 1, provided a written confirmation issued by Chinese 
local authorities which according to the exporter it proved that the company was not 
subject to any restrictions in its purchasing and selling activities. 

(49)  However,  since  the  confirmation  provided  is  in  contradiction  with  the  Articles  of 
Association of this particular exporting producer and the evidence provided could not 
be verified any more, the MET claim has to be rejected also at definitive stage. 

(50)  The co-operating exporter for which it was established that it did not meet criteria 1 to 
3  of  Article  2(7)(c)  of  the  basic  Regulation,  claimed  regarding  criterion  1  that  the 
purchasing  and  selling  restrictions  in  its  Articles  of  Association  (AoA)  were  not 
followed  by  the  company  in  practice.  Regarding  criterion  2,  it  did  not  contest  the 
findings but claimed that the accounting errors of the company were due to incorrect 
practices  of  its  accountants  and/or  instructions  from  the  local  tax  authorities. 
Regarding  criterion  3,  while  the  company  provided  certain  explanations  concerning 
the  discount  received  by  the  State  which  was  considered  as  improper  evaluation  of 

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land  use  rights,  it  did  not  submit  any  evidence  that  it  met  the  conditions  for  the 
discount.  

(51)  With regard to criterion 1, it is noted that the Chinese Company Law provides that the 
AoA  of  companies  are  binding  on  the  company,  shareholders,  directors,  supervisors 
and  senior  management  and  therefore  the  comments  of  the  company  were  rejected. 
Moreover,  with  regard  to  criteria  2  and  3,  the  comments  of  the  company  could  not 
justify  a  change  of  the  relevant  provisional  findings.  Therefore  recital  (54)  of  the 
provisional Regulation is herewith confirmed. 

(52) 

In relation to recital (57) of the provisional Regulation it is noted that the analysis of 
the  information  received  after  the  disclosure  of  MET  findings  does  not  justify  any 
change in the determination of the companies that were granted MET.  

(53)  The  company  to  which  IE  was  granted,  demonstrated  that  it  fulfilled  the  criteria  of 

Article 2(7)(c) and could, therefore, be granted MET.  

4.3. 

Individual treatment ('IT') 

(54)  One  interested  party  claimed  that  anti-competitive  practices  and  State  interference 
would  encourage  circumvention  of  the  measures  and  therefore  none  of  the  Chinese 
producers should be granted IT. 

(55) 

In  this  regard  it  is  noted,  that  this  party  did  not  provide  any  substantiated  evidence 
with regard to its claim. However, in order to minimise the risks of circumvention due 
to  the  high  difference  in  the  duty  rates,  it  is  considered  that  special  measures  are 
needed  in  this  case  to  ensure  the  proper  application  of  the  anti-dumping  duties  (see 
below recitals (149) and (150)).  

(56) 

In  the  absence  of  any  other  comments  with  regard  to  IT,  recitals  (58)  to  (60)  of  the 
provisional Regulation are hereby confirmed.  

4.4. 

Normal value 

4.4.1.  Cooperating exporters granted MET 

(57)  For the company in the PRC to which individual examination (IE) and subsequently 
MET  was  granted  (the  IE  company)  it  was  established  that  it  had  no  sales  on  the 
domestic  market.  Therefore,  normal  value  for  this  company  was  constructed  in 
accordance  with  Article  2(3)  of  the  basic  Regulation  by  applying  the  same 
methodology  for  cooperating  exporters  without  representative  domestic  sales  as 
described in recitals (67) to (69) of the provisional Regulation. 

(58) 

In  the  absence  of  any  other  comments  with  regard  to  normal  value  for  exporters 
granted MET, recitals (61) to (69) of the provisional Regulation are hereby confirmed.  

4.4.2.  Exporting producers not granted MET and analogue country 

(59)  Certain parties contested the choice of the Community industry as an analogue country 
mainly  due  to  the  fact  that  there  are  differences  in  the  labour  markets  and  thus  the 
labour  cost.  As  explained  in  details  in  recitals  (70)  to  (76)  of  the  provisional 
Regulation,  considerable  efforts  were  exerted  in  order  to  obtain  cooperation  from  an 
analogue  country.  Given  the  absence  of  cooperation  it  was  considered  that  the  data 
available  for  the  Community  industry  could  be  used  for  the  purpose  of  establishing 
normal  value  in  a  market  economy  country.  The  argument  concerning  differences  in 
labour  market  is  not  relevant  in  the  context  of  the  data  in  the  analogue  country. 
Moreover,  the  arguments  and  remarks  by  these  parties  were  provided  without  any 
substantiation  or  any  concrete  alternative  proposals  regarding  the  choice  of  the 

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analogue  country.  Hence,  these  comments  had  to  be  disregarded  and  the  provisional 
findings can be confirmed. 

(60) 

In the absence of any other comments concerning the analogue country, recitals (70) to 
(76) of the provisional Regulation are hereby confirmed.  

4.5. 

Export price 

(61)  As  the  IE  company  was  making  its  export  sales  to  the  Community  through  related 
companies located in the Community, sales export prices were established on the basis 
of the resale prices to the first independent customers in the Community, pursuant to 
Article 2(9) of the basic Regulation. 

(62) 

In  the  absence  of  any  comments  concerning  the  export  price,  which  would  alter  the 
provisional  findings,  recitals  (77)  to  (78)  of  the  provisional  Regulation  are  hereby 
confirmed.  

4.6. 

Comparison  

(63)  For  the  IE  company  the  adjustments  as  described  in  recitals  (81)  to  (83)  of  the 
provisional  Regulation  were  made  for  the  purpose  of  ensuring  a  fair  comparison 
between the normal value and the export price in accordance with Article 2(10) of the 
basic Regulation. 

(64)  One exporting producer requested a currency conversion adjustment to its export price 
in  accordance  with  Article  2(10)(j)  of  the  basic  Regulation.  It  quantified  this 
adjustment  as  the  net  exchange  losses  (resulting  as  the  difference  from  its  exchange 
gains and losses) incurred during the IP for its export sales of the product concerned to 
the  Community.  However,  as  this  exporter  failed  to  substantiate  that  there  was  a 
sustained movement in exchange rates during the IP the claim had to be disregarded.  

(65) 

In the absence of any other comments concerning the comparison, which would alter 
the provisional findings, recitals (79) to (83) of the provisional Regulation are hereby 
confirmed.  

4.7. 

Dumping margins  

(66)  Subsequent  to  the  provisional  disclosure  certain  exporting  producers  which  were 
granted  IT  claimed  that  according  to  Article  2(11)  of  the  basic  Regulation  all  their 
export transactions should have been used to establish their dumping margin.  

(67) 

In  view  of  these  comments  and  in  order  to  ensure  that  normal  values  could  be 
established for the vast majority of types exported from the PRC, in particular because 
the data of the analogue country was used, it was considered appropriate to adjust the 
criteria  used  to  identify  the  different  product  types  accordingly.  The  dumping 
calculations were, therefore, revised on the basis of the adjusted criteria.  

(68)  For one exporting producer an additional adjustment for physical characteristics based 
on the market  value of the difference between the raw  materials, in accordance  with 
Article 2(10)(a) of the basic Regulation was granted. 

(69)  Pursuant to Articles 2(11) and (12) of the basic Regulation, for the companies granted 
IT, the weighted average normal value was then compared with the weighted average 
export price of the corresponding type of the product concerned as identified above.  

(70)  On  this  basis,  the  definitive  dumping  margins  expressed  as  a  percentage  of  the  CIF 

Community frontier price, duty unpaid, are the following: 

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Company 

Definitive dumping margin 

Aroma Consumer Products (Hangzhou) Co., Ltd. 

47,7% 

Dalian Bright Wax Co., Ltd. 

Dalian Talent Gift Co., Ltd. 

Gala-Candles (Dalian) Co., Ltd. 

M.X. Candles and Gifts (Taicang) Co., Ltd. 

Ningbo Kwung's Home Interior & Gift Co., Ltd. 

Ningbo Kwung's Wisdom Art & Design Co., Ltd. 

Qingdao Kingking Applied Chemistry Co., Ltd. 

Cooperating non-sampled  

13,8% 

48,4% 

0% 

0% 

14,0% 

0% 

18,8% 

31,8% 

(71) 

In  view  of  the  changes  in  the  dumping  margins  of  the  sampled  companies,  the 
weighted  average  dumping  margin  of  the  co-operating  exporters  not  included  in  the 
sample was recalculated in accordance with the methodology described in recital (86) 
of the provisional Regulation and as indicated above it was established at 31,8% of the 
CIF Community frontier price, duty unpaid.  

(72)  The  basis  for  establishing  the  country-wide  dumping  margin  was  set  out  in  recitals 
(87)  to  (88)  of  the  provisional  Regulation,  which,  taking  into  account  the  revised 
calculations, as explained in recital (67) above, decreased from 66,1% to 62,9%.  

(73)  One  party  questioned  the  legal  basis  on  which  the  non-cooperating  exporters  were 
attributed a higher dumping margin than the co-operating non-sampled. In this regard 
it  is  clarified  that  the  methodology  described  in  recital  (87)  of  the  provisional 
Regulation  which  is  based  on  facts  available  was  applied  under  the  provisions  of 
Article 18 of the basic Regulation.  

(74)  On this basis the country-wide level of dumping was definitively established at 62,9% 

of the CIF Community frontier price, duty unpaid. 

5. 

5.1. 

(75) 

INJURY 

Community production 

In  the  absence  of  any  comments  and  any  new  findings  concerning  the  Community 
production, recitals (90) and (91) of the provisional Regulation are hereby confirmed. 

5.2. 

Definition of the Community industry 

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(76) 

In the absence of any comments concerning the definition of the Community industry, 
which  would  have  altered  the  provisional  findings,  recital  (92)  of  the  provisional 
Regulation is hereby confirmed.  

5.3. 

Community consumption 

Table  

Community Consumption  

2004 

2005 

2006 

IP 

Tonnes 
 Index 

511 103 
100 

545 757 
107 

519 801 
102 

577 332 
113 

Source: Eurostat and questionnaire replies 

(77) 

In the absence of any comments concerning the Community consumption as shown in 
the  above  table,  recitals  (93)  and  (94)  of  the  provisional  Regulation  are  hereby 
confirmed. 

5.4. 

Imports into the Community from the PRC 

5.4.1.  Volume, price and market share of dumped imports 

(78)  The table below shows the total imports into the Community market made by Chinese 

exporting producers during the period considered. 

Table 

All imports from PRC 

2004 

2005 

2006 

IP 

Imports (tonnes) 
Index 
Prices (€/tonne) 
Index 
Market share  
Index 

Source: Eurostat 

147 530 
100 
1 486 
100 
28,9% 
100 

177 662 
120 
1 518 
102 
32,6% 
113 

168 986 
115 
1 678 
113 
32,5% 
112 

199 112 
135 
1 599 
108 
34,5% 
119 

(79)  As  indicated  in  recital  (97)  of  the  provisional  Regulation,  when  using  sampling  to 
establish  dumping  it  is  the  Commission's  practice  to  then  examine  whether  there  is 
positive evidence showing whether or not all the companies which were not sampled 
were effectively dumping their products on the Community market during the IP.  

(80) 

In view of the definitive findings concerning dumping, and the fact that two additional 
companies  were  found  not  to  be  dumping  their  products  on  the  Community  market, 
the total volume and price of  dumped  imports had to be reassessed. To this end, the 
export  prices  charged  by  the  co-operating  exporting  producers  not  included  in  the 
sample and the export prices of the non-cooperating exporters were re-investigated on 
the  basis  of  Eurostat  data,  the  questionnaire  responses  of  the  sampled  exporting 
producers  in  the  PRC  and  the  replies  to  the  sampling  forms  provided  by  all  the 
cooperating companies in the PRC.  

(81)  As it has been done at provisional stage, it was considered that by adding the average 
dumping margin found on the basis of the sampled exporting producers to the average 
export  prices  established  for  the  sampled  exporting  producers  found  to  be  dumping, 
the level of non-dumped export prices would be set. The export prices established for 

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the  non-sampled  exporting  producers  were  then  compared  with  the  non-dumped 
export prices. 

(82)  This price comparison showed that both i) the co-operating exporting producers which 
were  not  included  in  the  sample  and  ii)  the  exporting  producers  which  did  not  co-
operate  in  the  investigation had average export prices which were in all cases below 
the average non-dumped prices established for the sampled exporting producers. This 
was sufficient  indication that the imports  from all companies that were  not sampled, 
namely  the  co-operating  and  non-co-operating  ones,  could  be  considered  as  being 
dumped. 

(83)  As mentioned in recital (80) above, it was found that three exporting producers in the 
PRC,  two  of  them  included  in  the  sample  and  one  to  which  individual  examination 
was  granted,  were  not  dumping  their  products  on  the  Community  market. 
Accordingly,  their  exports  were  excluded  from  the  analysis  concerning  the 
development of dumped imports on the Community market.  

(84)  The table below comprises all imports of candles originating in the PRC which were 
found  or  considered  to  be  dumped  on  the  Community  market  during  the  period 
considered. 

Table 

Dumped imports PRC 

2004 

2005 

2006 

IP 

Imports (tonnes) 
Index 
Prices (€/tonne) 
Index 
Market share  
Index 

137 754 
100 
1 420 
100 
27,0% 
100 

159 979 
116 
1 470 
104 
29,3% 
109 

152 803 
111 
1 610 
113 
29,4% 
109 

181 043 
131 
1 560 
110 
31,4% 
116 

Source: Eurostat and questionnaire replies 

(85)  Overall, dumped imports from the PRC significantly increased from 137 754 tonnes in 
2004 to 181 043 tonnes in the IP, i.e. by 31% or by more than 43 000 tonnes, over the 
period considered. The increase of the corresponding market share (+ 4,4 percentage 
points)  was  less  pronounced  because  of  the  increase  in  Community  consumption.  In 
addition, despite a general downturn in consumption in the period between 2005 and 
2006, dumped imports did not lose any share of the market they were holding.  

(86)  Average prices of dumped imports from the PRC showed an increase of 10% during 
the period considered but were strong indications that they were made at significantly 
dumped prices, of over 40% on average, during the IP. The average price of dumped 
imports decreased by over 3% between 2006 and the IP and, as explained below, was 
undercutting the Community industry's prices in that period.  

(87)  Overall, the observations made in recitals (97) to (105) of the provisional Regulation 

remain valid and can be confirmed. 

5.4.2.  Price undercutting 

(88)  The methodology described in recital (106) of the provisional Regulation to establish 
price  undercutting  is  confirmed.  However,  following  the  verification  visits  at  the 
premises of the unrelated importers after the imposition of provisional measures, the 
adjustment  for  post-importation  costs  has  been  revised  in  light  of  the  verified  data 
obtained from these importers. 

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(89)  Following the provisional disclosure, several exporters which were granted IT, as well 
as  the  Community  industry,  questioned  the  low  level  of  comparability  in  the  price 
comparison exercise. As it was the case for the dumping calculations, the parties asked 
to increase the level of comparability. As a consequence, it was considered appropriate 
to  apply  the  same  criteria  to  increase  the  comparability  as  those  applied  in  the 
dumping calculations, as described in recital (67) above. The undercutting calculations 
were thus revised accordingly.  

(90) 

In  addition  some  parties  mentioned  that  some  clerical  errors  were  made  in  their 
provisional calculations. These errors were corrected, where warranted.  

(91)  On the basis of the above, the average price undercutting margin in the IP, expressed 
as  a  percentage  of  the  Community  industry's  weighted  average  ex-work  prices,  was 
found to be 15,7%. 

5.5. 

Economic situation of the Community industry 

(92)  As mentioned in recitals (130) to (134) of the provisional Regulation, it was found that 
the Community industry suffered material injury within the meaning of Article 3(5) of 
the basic Regulation.  

(93) 

Indeed,  the  provisional  analysis  showed  that  the  performance  of  the  Community 
industry  improved  as  regards  some  volume  indicators,  but  that  all  the  indicators 
related to the financial situation of the Community industry significantly deteriorated 
during  the  period  considered.  Notwithstanding  the  Community  industry's  ability  to 
raise capital for investments, return on investments became negative in the IP and cash 
flow declined significantly over the period considered. Average sales prices decreased 
by  9%  over  the  period  considered  and  losses  were  encountered  during  the  IP.  In 
addition, other injury indicators pertaining to the Community industry also developed 
negatively  during  the  period  considered  and  the  Community  industry  was  prevented 
from  benefitting  from  the  13%  market  increase  as  it  could  only  increase  its  sales 
volume by 3%.  

(94)  As regards the stocks of the Community industry, one interested party claimed that the 
increased  level  of  end-year  stocks  and  the  injury  found  was  the  result  of 
overproduction,  which  allegedly  also  led  to  the  lodging  of  the  complaint  by  the 
Community industry.  

(95)  As mentioned in recital (119) of the provisional Regulation, although stocks increased 
during the IP in absolute terms, in percentage terms they remained relatively stable at 
around  25%  of  the  production  volume  of  the  Community  industry.  Furthermore, 
stocks were not considered to be a meaningful injury factor in the analysis which led 
to  the  conclusion  that  the  Community  industry  was  suffering  material  injury.  In 
addition,  this  party  did  not  provide  any  evidence  to  substantiate  its  claim  and  no 
comments were made on the facts and considerations which led to the conclusion that 
the Community industry was suffering material injury as described in recitals (130) to 
(134) of the provisional Regulation. Based on the above, the claim was rejected.  

(96) 

In  the  absence  of  any  other  comments  on  the  provisional  findings  concerning  the 
economic  situation  of  the  Community  industry,  recitals  (109)  to  (129)  of  the 
provisional Regulation are hereby confirmed. 

(97)  The  conclusion  that  the  Community  industry  suffered  material  injury,  as  set  out  in 

recitals (130) to (134) of the provisional Regulation, is also confirmed.  

6. 

CAUSATION 

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6.1. 

Effect of the dumped imports  

(98)  Following  the  finding  that  two  additional  exporting  producers  in  the  PRC  were  not 
dumping  their  products  in  the  Community  market,  it  was  reassessed  whether  the 
findings  and  conclusions  described  in  recitals  (136)  to  (142)  of  the  provisional 
Regulation remained valid. 

(99)  The  reassessment  confirmed  that  the  candles  exported  from  the  PRC  to  the 
Community  market  were  sold  at  significantly  dumped  prices  during  the  IP.  As 
mentioned in recital (71) above, it was found that the co-operating exporting producers 
in  the  PRC  were  selling  the  product  concerned  with  an  average  dumping  margin  of 
31,8%.  The  finding  that  around  55%  of  Chinese  exporters  did  not  cooperate  in  the 
investigation is confirmed. As mentioned in recital (82) above, the investigation found 
sufficient indication that these exporting producers were also dumping their products 
on the Community market.. 

(100)  Dumped  imports  on  the  Community  market  increased  in  volume  by  31%  during  the 
period considered. This increase was made at significantly dumped prices undercutting 
the prices of the Community industry by 15,7% during the IP. Accordingly, the market 
share  held  by  exporting  producers  whose  imports  were  found  or  considered  to  be 
dumped grew from around 27% to around 31,4%, an increase of 4,4 percentage points 
over the period considered.  

(101)  Based  on  the  above  facts  and  considerations,  the  fact  that  two  additional  exporting 
producers were not dumping their product on the Community market does not change 
the analysis made in recitals (136) to (142) of the provisional Regulation.  

(102)  It is therefore confirmed that the surge of low-priced dumped imports from the PRC 
had  a  considerable  negative  impact  on  the  economic  situation  of  the  Community 
industry during the IP. 

6.2. 

Effect of other factors 

(103)  In  the  absence  of  any  comments,  concerning  the  development  of  demand  on  the 
Community  market,  the  imports  of  candles  by  the  Community  industry,  the  imports 
from  other  third  countries  or  the  performance  of  other  candle  producers  in  the 
Community, recitals (143) to (151) of the provisional Regulation are confirmed. 

6.2.1.  Export performance of the Community industry 

(104)  One party argued that the Community industry could not follow the expansion of the 

Community market due to the fact that it had increased its export sales during the IP.  

(105)  Based  on  Eurostat  data  and  questionnaire  replies  from  the  sampled  Community 
producers,  total  exports  of  candles  outside  the  Community  by  the  Community 
producers  increased  by  10%  or  by  around  5  000  tonnes  between  2006  and  the  IP.  It 
was provisionally found that this relatively good export performance was particularly 
beneficial for the Community industry during the IP. 

(106)  To fully examine the claim, it is necessary to look at the level of stocks, the production 
capacity  and  the  rate  of  utilisation  of  the  production  capacity  of  the  Community 
industry.  As  mentioned  in  recital  (118)  of  the  provisional  Regulation  the  level  of 
stocks  available  to  the  Community  industry  represented  on  average  around  25%  of 
production and was as high as 56 000 tonnes during the IP. The stocks even increased 
by around 2 400 tonnes between 2006 and the IP. Moreover, as shown in Table 3 of 
the  provisional  Regulation,  the  production  capacity  of  the  Community  industry  was 

EN 

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continuously increased during the period considered and the rate of utilisation of the 
production capacity of the Community industry was at 76% during the IP whereas it 
was 82% in 2005. Hence, the Community industry could have produced and sold more 
of its products on the Community market. 

(107)  Based on the above facts and considerations the claim that the increase in export sales 
by  the  Community  industry  would  have  explained  the  fact  that  the  Community 
industry could not follow the expansion of consumption is rejected. Consequently the 
conclusion in recital (153) of the provisional Regulation that the export performance 
of the Community industry did not contribute to the material injury is confirmed. 

6.2.2. 

Imports  of candles by the Community industry  and relocation  of  production by the 
Community industry 

(108)  In  the  absence  of  any  comments  regarding  imports  of  candles  by  the  Community 
industry and the relocation of production by the Community industry, recitals (154) to 
(160) of the provisional Regulation are confirmed. 

6.2.3. 

Impact of the existence of a cartel among European paraffin wax producers 

(109)  One  party  reiterated  their  concerns  about  the  existence  of  a  cartel  among  certain 
Community  paraffin  wax  producers  as  established  by  the  Directorate  General  for 
Competition based on its investigation that started in early 2005. However it did not 
submit  any  new  elements  which  would  contest  the  provisional  conclusion  that  the 
cartel did not have any impact on the injury suffered by the Community industry.  

(110)  It is recalled that based on information available it was found that the impact, if any, of 
this cartel on the economic situation of the Community industry during the IP, i.e. the 
year  2007,  was  negligible.  Although  price  levels  for  paraffin  wax  increased  in  the 
Community during the IP, it was found that in cases where the Community producers 
purchased identical paraffin types from cartel members or other suppliers, there were 
no  substantial  price  differences.  Moreover  the  purchase  prices  of  the  Community 
producers were found to be in line with those observed for the co-operating producers 
in  the  PRC.  Finally,  no  differences  pointing  to  any  lasting  effectiveness  of  the  price 
agreements made back in the period 2004-2005 could be found during the IP.  

(111)  In  view  of  the  above,  in  absence  of  any  other  comments  and  of  any  new  findings, 

recitals (161) to (169) of the provisional Regulation are confirmed. 

6.2.4.  Conclusion on causation  

(112)  In the light of the foregoing and in the absence of any other comments recitals (170) to 

(173) of the provisional Regulation are confirmed.  

7. 

COMMUNITY INTEREST 

7.1. 

Community industry 

(113)  In  the  absence  of  any  comments  concerning  the  interest  of  the  Community  industry, 

recitals (175) to (178) of the provisional Regulation are confirmed.  

7.2. 

Impact on retailers and importers  

(114)  As  mentioned  in  recital  (179)  of  the  provisional  Regulation,  of  the  six  questionnaire 
replies received, out of the 32 questionnaires sent to assess the possible impact of the 
proposed  measures  on  the  activity  of  retailers  and  importers,  only  two  replies  were 
received  which  could  be  considered  to  be  meaningful  for  the  purpose  of  the 

EN 

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Community  interest  analysis.  These  two  replies  were  received  from  importers  of 
candles.  

(115)  It is recalled that the Community market is composed of large retailers, which mainly 
import candles directly from the PRC and subsequently resell them to the consumers, 
and of importers, which generally sell to other intermediary parties in the distribution 
chain,  mainly  retailers  or  wholesalers,  before  the  product  reaches  the  end-customer. 
The analysis of the Community market showed that within the distribution chain the 
consumer price is in general set by the large retailers, which however did not provide 
any meaningful information in the context of the investigation, allowing to accurately 
assessing the likely impact of the anti-dumping measures on their activity.  

(116)  Certain  parties  claimed  that  there  are  two  separate  retail  markets  for  candles  in  the 
Community  and  that  the  Community  producers  predominantly  supply  the  upper-end 
market while the lower-end market would be supplied by candles imported from the 
PRC.  They  argued  that  with  the  imposition  of  anti-dumping  duties  the  latter  would 
disappear as retailers would choose to drop candles from their product range.  

(117)  It should first be noted that the findings of the investigation did not support the above 
claim  that  there  would  be  two  separate  retail  markets  in  the  Community  or  that  this 
aspect  could  have  been  a  relevant  factor  to  take  into  account  in  the  analysis  of 
Community interest issues. Secondly, even if a lower-end market existed, contrary to 
the claim made by these parties, it is considered that even with anti-dumping measures 
in place, the retailers would still have the possibility to purchase at least part of their 
candles without being subject to anti-dumping duties. Indeed, on the one hand, there 
are  various  sources  of  supply  available  in  the  Community  market  and,  on  the  other 
hand, certain Chinese exporting producers are either not subject to anti-dumping duties 
or are subject to anti-dumping duties the level and form of which are likely to keep the 
imports  from  the  PRC  still  competitive,  although  at  non-injurious  prices.  Finally, 
considering the level of the margins achieved by the retailers on the product concerned 
on the basis of the available information, the claim did not appear to be justified and 
was therefore rejected.  

(118)  Following the provisional disclosure, certain large retailers and also some other parties 
contested the method used to estimate the retailers' gross profit margin on the product 
concerned  and  hence  the  conclusion  reached  in  recital  (185)  of  the  provisional 
Regulation  that,  in  view  of  the  high  gross  margins,  the  anti-dumping  duties  would 
have a limited impact, if any, on the retailers.  

(119)  After  examination  of  the  claim,  it  should  be  noted  that  the  wording  in  the  relevant 
recital  of  the  provisional  Regulation  should  be  revised.  The  word  "gross  profit 
margins" in the first sentence of recital (185) of the provisional Regulation should in 
fact  be  read  as  "mark  up".  This  change  in  the  wording  does  however  not  alter  the 
conclusions concerning the possible impact of the measures on retailers. The result of 
the calculations made in the provisional Regulation remains valid.  

(120)  Moreover,  these  parties  did  not  substantiate  their  claims,  nor  did  they  come  forward 
with  any  evidence  that  would  have  allowed  for  establishing  a  more  accurate  profit 
margin  for  the  definitive  determinations  on  Community  interest.  In  addition,  no 
alternative  method  was  proposed  by  these  parties  to  assess  the  impact  of  duties  on 
retailers. Based on the above, the calculations made in recital (185) of the provisional 
Regulation are hereby confirmed.  

EN 

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(121)  In  the  absence  of  any  other  comments,  recitals  (183)  to  (187)  of  the  provisional 

Regulation are confirmed. 

(122)  As  regards  the  impact  of  measures  on  importers,  which  as  explained  in  recital  (115) 
above, mainly supply retailers and wholesalers with candles imported inter alia from 
the  PRC,  the  investigation  showed  that  candles  are  often  purchased  or  imported  and 
then  packaged  with  various  other  related  articles,  such  as  glass  and  ceramic  candle 
holders.  The  investigation  showed  that  candles  can  also  be  sold  at  a  relatively  low 
price to stimulate the sales of other products related to candles on which higher profits 
are realised. Under these circumstances, assessing the impact of the measures on the 
activity relating to candles only, has proven to be difficult.  

(123)  However,  based  on  the  verified  data  of  the  two  cooperating  importers,  it  was  found 
that  the  overall  gross  profit  margins  of  these  companies  exclusively  on  the  product 
concerned were not low (significantly above 25%). A profit margin for a category of 
products including all candle-related products would be even higher. In addition, it is 
considered that any price increase, or at least part of the possible price increase linked 
to the imposition of anti-dumping measures on candles, could likely be passed on to 
the  distribution  chain.  It  was  thus  considered  that  any  impact  of  anti-dumping 
measures is not likely to be significant on the overall candle-related activity.  

(124)  A  further  analysis  of  the  data  supplied  by  importers  confirmed  that  the  product 
concerned  represents  on  average  only  3,4%  of  their  overall  turnover.  For  one  of  the 
two importers this share was somewhat higher and therefore it cannot be excluded that 
the imposition of measures could have a negative impact on this importer.. However, 
considering all the interests at stake in the case, it was concluded that on average the 
impact  of  the  anti-dumping  duties  on  the  total  company  activity  of  the  importers 
cannot be considered to be significant.  

(125)  Based  on  the  above,  the  conclusion,  as  set  out  in  recital  (182)  of  the  provisional 

Regulation, is hereby confirmed. 

7.3. 

Impact on consumers 

(126)  The claim mentioned in recital (116) above that two separate retail markets exist and 
that,  as  a  consequence  of  the  anti-dumping  measures,  the  lower-end  market  could 
disappear, also referred to the impact on consumers since the choice for the consumer 
of candles with a lower quality would be limited.  

(127)  However, this claim has not been substantiated. It was considered that in view of the 
structure of the retail market, the margins achieved by retailers, and the level and form 
of the anti-dumping duties, it is reasonable to expect that there should be no risk for 
the disappearance of a lower-end market, as importers and retailers should be able to 
absorb the duty, without passing it on to consumers.  

(128)  It  is  also  recalled  that  as  mentioned  in  recital  (131)  below,  the  purpose  of  anti-
dumping measures is to restore effective trade conditions on the Community market to 
the  benefit  of  all  operators,  including  the  consumers.  The  above  facts  and 
considerations  and  all  the  information  available  in  this  case  do  not  point  to  any 
significant impact on consumers.  

(129)  In  the  absence  of  any  reaction  from  consumer  associations  after  the  imposition  of 
provisional  anti-dumping  duties,  the  conclusion  reached  in  recital  (191)  of  the 
provisional  Regulation  that  anti-dumping  duties  should  have  no  material  impact  on 
consumers is confirmed. 

EN 

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7.4. 

Competition and trade distorting effects 

(130)  One  party  claimed  that  on  the  basis  of  the  figures  provided  in  the  provisional 
Regulation, the Community production alone would not meet the demand for candles 
in  the  Community.  Hence  imported  candles  from  the  PRC  would  be  needed  to  meet 
the  Community  demand  and  measures  would  allegedly  prevent  these  candles  to  be 
present on the market.  

(131)  While the total Community production alone may not be sufficient to meet the demand 
for candles on the Community market, it is recalled that there are imports from other 
third  countries  and  that  some  exporting  producers  in  the  PRC  are  not  subject  to 
measures,  it  should  also  be  stressed  that  the  aim  of  the  imposition  of  anti-dumping 
measures is to restore effective trade conditions and not to close the market to imports. 
Hence,  the  supply  of  candles  from  all  the  operators  currently  present  in  the 
Community market would continue and should be sufficient to satisfy the demand in a 
market where the negative effects of injurious dumping have been removed. Hence the 
claim is not considered to be founded.  

(132)  In  view  of  the  above,  and  in  the  absence  of  any  other  comments,  recitals  (194)  and 

(195) of the provisional Regulation are confirmed. 

7.5. 

Conclusion on Community interest 

(133)  Based  on  the  above,  it  is  concluded  that  there  are  no  compelling  reasons  against  the 

imposition of anti-dumping duties in the present case. 

8. 

DEFINITIVE ANTI-DUMPING MEASURES 

8.1. 

Injury elimination level 

(134)  In  view  of  the  conclusions  reached  with  regard  to  dumping,  injury,  causation  and 
Community interest, definitive anti-dumping measures should be imposed in order to 
prevent  further  injury  being  caused  to  the  Community  industry  by  the  dumped 
imports.  

(135)  In  the  absence  of  comments  following  the  provisional  disclosure,  the  same 
methodology as mentioned in recital (199) of the provisional Regulation has been used 
to obtain the non-injurious prices. However, the same revisions as described in recitals 
(89) and (90) have been applied also for the calculation of the injury margins, which 
have been adjusted accordingly. 

8.2. 

Form and level of the duties 

(136)  In  the  light  of  the  foregoing  and  in  accordance  with  Article  9(4)  of  the  basic 
Regulation, a definitive anti-dumping duty should be imposed at a level sufficient to 
eliminate  the  injury  caused  by  the  dumped  imports  without  exceeding  the  dumping 
margin found.  

(137)  In  view  of  the  comments  received  by  certain  interested  parties  following  the 
provisional disclosure and in view of the revisions described in this Regulation, certain 
margins have been amended. 

(138)  The dumping and injury rates established are a follows: 

Company 

Dumping margin 

Injury 
elimination  
margin 

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Aroma Consumer Products (Hangzhou) Co., Ltd. 

Dalian Bright Wax Co., Ltd. 

Dalian Talent Gift Co., Ltd. 

Gala-Candles (Dalian) Co., Ltd. 

M.X. Candles and Gifts (Taicang) Co., Ltd. 

47,7% 

13,8% 

48,4% 

0% 

0% 

Ningbo Kwung's Home Interior & Gift Co., Ltd. 

14,0% 

Ningbo Kwung's Wisdom Art & Design Co., Ltd. 

0% 

Qingdao Kingking Applied Chemistry Co., Ltd. 

Co-operating non-sampled  

All other companies 

18,8% 

31,8% 

62,9% 

28,3% 

11,7% 

25,9% 

N/A 

N/A 

0% 

N/A 

0% 

25,5% 

37,1% 

(139)  As indicated in recital (203) of the provisional Regulation in view of the fact that very 
often candles are imported in sets together with pillars, holders or other items, it was 
considered  appropriate  to  determine  the  duties  as  fixed  amounts  on  the  basis  of  fuel 
content, wick included, of the candles. 

(140)  Certain  parties  claimed  that measures should be based on  an  ad valorem duty as the 
form  of  measure  on  the  basis  of  the  weight  of  fuel  content  of  the  candles  would  be 
burdensome for importers and would cause significant confusion and distortion on the 
market.  

(141)  In  this  respect  it  is  recalled  that  sets  containing  candles  were  being  classified  upon 
importation as candles. This means that an eventual ad valorem duty would be applied 
to the whole value of the set. For this purpose it was considered more appropriate to 
determine  the  duties  as  fixed  amounts  on  the  basis  of  fuel  content  of  the  candles  in 
order  to  avoid  unduly  targeting  with  anti-dumping  duties  imported  goods  that  are 
currently classified as candles, but in which the candle can be a fraction of the weight 
or the value of the imported product. On this basis, this claim was not accepted.  

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

(143)  Any claim requesting the application of an individual company anti-dumping duty rate 
(e.g. following a change in the name of the entity or following the setting up of new 

EN 

22 

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production or sales entities) should be addressed to the Commission3 forthwith with all 
relevant information, in particular any modification in the company's activities linked 
to  production,  domestic  and  export  sales  associated  with,  for  example,  that  name 
change  or  that  change  in  the  production  and  sales  entities.  If  appropriate,  the 
Regulation  will  then  be  amended  accordingly  by  updating  the  list  of  companies 
benefiting from individual duty rates. 

(144)  All  parties  were  informed  of  the  essential  facts  and  considerations  on  the  basis  of 
which it was intended to recommend the imposition of definitive anti-dumping duties. 
They  were  also  granted  a  period  within  which  they  could  make  representations 
subsequent  to  this  disclosure.  The  comments  submitted  by  the  parties  were  duly 
considered, and, where appropriate, the findings have been modified accordingly.  

(145)  In  order  to  ensure  equal  treatment  between  any  new  exporting  producers  and  the 
cooperating  companies  not  included  in  the  sample,  mentioned  in  Annex  I  of  this 
Regulation, provision should be made for the weighted average duty imposed on the 
latter  companies  to  be  applied  to  any  new  exporters  which  would  otherwise  not  be 
entitled to a review pursuant to Article 11(4) of the basic Regulation, as Article 11(4) 
does not apply where sampling has been used.  

8.3. 

Undertakings  

(146)  Following the disclosure of the essential facts and considerations on the basis of which 
it  was  intended  to  recommend  the  imposition  of  definitive  anti-dumping  duties,  one 
non-sampled exporting producer in the PRC offered a price undertaking in accordance 
with Article 8(1) of the basic Regulation.  

(147)  In  this  regard  it  is  noted  that  the  product  concerned  is  characterised  by  hundreds  of 
different  product  types,  with  varying  characteristics  and  significant  price  variations 
between them. The exporting producer offered only one minimum import price (MIP) 
for all products at a level that would have not guaranteed the elimination of injurious 
dumping for all products. Moreover, it is also noted that the high number of product 
types makes it virtually impossible to establish meaningful minimum prices for each 
product  type  which  could  be  properly  monitored  by  the  Commission  even  if  the 
exporting  producer  had  offered  different  MIPs  for  each  of  them.  Under  these 
circumstances,  it  was  concluded  that  the  undertaking  offer  had  to  be  rejected  as 
impractical.  

8.4. 

Definitive collection of provisional duties and special monitoring 

(148)  In view of the magnitude of the dumping margins found and in the light of the level of 
the  injury  caused  to  the  Community  industry,  it  is  considered  necessary  that  the 
amounts  secured  by  way  of  the  provisional  anti-dumping  duty,  imposed  by  the 
provisional Regulation should be definitively collected to the extent of the amount of 
the  definitive  duties  imposed.  Where  the  definitive  duties  are  lower  than  the 
provisional  duties,  amounts  provisionally  secured  in  excess  of  the  definitive  rate  of 
anti-dumping duties shall be released. Where the definitive duties are higher than the 
provisional duties, only the amounts secured at the level of the provisional duties shall 
be definitively collected. 

(149)  In order to minimise the risks of circumvention due to the high difference in the duty 
rates, it is considered that special measures are needed in this case to ensure the proper 

3 

European Commission, Directorate-General for Trade, Directorate H, Office N105 04/092, 1049 Brussels, Belgium  

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the  anti-dumping  duties.  These  special  measures 

application  of 
the 
presentation  to  the  Customs  authorities  of  the  Member  States  of  a  valid  commercial 
invoice,  which  shall  conform  to  the  requirements  set  out  in  Annex  II  to  this 
Regulation. Imports not accompanied by such an invoice shall be made subject to the 
residual anti-dumping duty applicable to all other exporting producers. 

include 

(150)  Should  the  exports  by  one  of  the  companies  benefiting  from  lower  individual  duty 
rates increase significantly in volume after the imposition of the measures concerned, 
such an increase in volume could be considered as constituting in itself a change in the 
pattern of trade due to the imposition of measures within the meaning of Article 13(1) 
of the basic Regulation. In such circumstances, and provided the conditions are met, 
an  anti-circumvention  investigation  may  be  initiated.  This  investigation  may,  inter 
alia,  examine  the  need  for  the  removal  of  individual  duty  rates  and  the  consequent 
imposition of a country-wide duty. 

(151)  Certain corrections to the denominations of the companies listed in the Annex of the 
provisional  Regulation  were  deemed  necessary  following  comments  and  relevant 
information received from the companies concerned. Accordingly these changes have 
been incorporated to the list of companies listed in Annex I. 

HAS ADOPTED THIS REGULATION: 

Article 1 

1. 

A definitive anti-dumping duty is hereby imposed on imports of candles, tapers and 
the like, other than memory lights and other outdoor burners, falling within CN code 
ex 3406 00 11, ex 3406 00 19 and ex 3406 00 90 (TARIC codes 3406 00 11 90, 3406 
00 19 90 and 3406 00 90 90) and originating in the People's Republic of China.  

For  the  purposes  of  this  Regulation  "memory  lights  and  other  outdoor  burners" 
means  candles,  tapers  and  the  like  which  have  one  or  more  of  the  following 
characteristics: 

(a) 

(b) 

(c) 

(d) 

their fuel contains more than 500 ppm of toluene; 

their fuel contains more than 100 ppm benzene; 

they have a wick with a diameter of at least 5 millimetres; 

they  are  individually  contained  in  a  plastic  container  with  vertical 
walls of at least 5 cm in height. 

2. 

The  rate  of  the  definitive  anti-dumping  duty  shall  be  a  fixed  amount  of  euro  per 
tonne of the fuel (usually but not necessarily in the form of tallow, stearin, paraffin 
wax or other waxes, including the wick) content of the products manufactured by the 
companies as shown below: 

Company 

Aroma Consumer Products 
(Hangzhou) Co., Ltd. 

Dalian Bright Wax Co., Ltd. 

Amount of duty 
EURO per tonne 
of fuel 

Taric additional code

321,83 

171,98 

A910 

A911 

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Dalian Talent Gift Co., Ltd. 

367,09 

Gala-Candles (Dalian) Co., Ltd. 

M.X. Candles and Gifts (Taicang) 
Co., Ltd. 

Ningbo Kwung's Home Interior & 
Gift Co., Ltd. 

Ningbo Kwung's Wisdom Art & 
Design Co., Ltd., and its related 
company Shaoxing Koman Home 
Interior Co., Ltd. 

Qingdao Kingking Applied 
Chemistry Co., Ltd. 

Companies listed in Annex I 

All other companies  

0 

0 

0 

0 

0 

345,86 

549,33 

A912 

A913 

A951 

A914 

A915 

A916 

A917 

A999 

3. 

4. 

5. 

In  cases  where  goods  have  been  damaged  before  entry  into  free  circulation  and, 
therefore, the price actually paid or payable is apportioned for the determination of 
the  customs  value  pursuant  to  Article  145  of  Commission  Regulation  (EEC)  No 
2454/934,  the  amount  of  anti-dumping  duty,  calculated  on  the  amounts  set  above, 
shall be reduced by a percentage which corresponds to the apportioning of the price 
actually paid or payable. 

The application of the individual duty rates specified for the companies mentioned in 
paragraph 2 and Annex I of this Regulation shall be conditional upon presentation to 
the customs authorities of the Member States of a valid commercial invoice, which 
shall conform to the requirements set out in Annex II of this Regulation. If no such 
invoice is presented, the duty rate applicable to all other companies shall apply.  

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

Article 2 

Amounts  secured  by  way  of  provisional  anti-dumping  duties  pursuant  to  Commission 
Regulation  (EC)  No  1130/2008  on  imports  of  certain  candles,  tapers  and  the  like  falling 
within CN code ex 3406 00 11, ex 3406 00 19 and ex 3406 00 90 (TARIC codes 3406 00 11 
90, 3406 00 19 90 and 3406 00 90 90) and originating in the People's Republic of China shall 
be definitively collected. The amounts secured in excess of the amount of the definitive anti-
dumping duties shall be released. Where the definitive duties are higher than the provisional 
duties,  only  the  amounts  secured  at  the  level  of  the  provisional  duties  shall  be  definitively 
collected. 

4 

OJ L 253, 11.10.1993, p. 1. 

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25 

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Article 3 

Where  any  party  from  the  People's  Republic  of  China  provides  sufficient  evidence  to  the 
Commission  that  it  did  not  export  the  goods  described  in  Article  1(1)  originating  in  the 
People's  Republic  of  China  during  the  period  of  investigation,  that  is  1  January  2007  to  31 
December  2007;  that  it  is  not  related  to  an  exporter  or  producer  subject  to  the  measures 
imposed  by  this  Regulation;  and  that  it  has  either  actually  exported  the  goods  concerned  or 
has  entered  into  an  irrevocable  contractual  obligation  to  export  a  significant  quantity  to  the 
Community after the end of the period of investigation, the Council, acting by simple majority 
on  a  proposal  by  the  Commission,  after  consulting  the  Advisory  Committee,  may  amend 
Article 1(2) in order to attribute to that party the duty applicable to cooperating producers not 
in the sample, i.e. 345,86 EURO per tonne of fuel. 

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. 

Done at Brussels,  

For the Council 
The President 
[…] 

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ANNEX I: Chinese cooperating exporting producers not sampled 

TARIC Additional Code A917 

Beijing Candleman Candle Co., Ltd. 

Cixi Shares Arts & Crafts Co., Ltd. 

Dalian All Bright Arts & Crafts Co., Ltd. 

Dalian Aroma Article Co., Ltd. 

Dalian Glory Arts & crafts Co., Ltd. 

Dandong Kaida Arts & crafts Co., Ltd. 

Dehua Fudong Porcelain Co., Ltd. 

Dongguan Xunrong Wax Industry Co.,Ltd. 

Fushun Hongxu Wax Co., Ltd.  

Fushun Pingtian Wax Products Co., Ltd. 

Future International (Gift) Co., Ltd. 

Greenbay Craft (Shanghai)Co., Ltd. 

Horsten Xi'an Innovation Co., Ltd. 

Ningbo Hengyu Artware Co., Ltd. 

Beijing 

Cixi 

Dalian 

Dalian 

Dalian 

Dandong 

Dehua 

Dongguan 

Fushun 

Fushun 

Taizhou 

Shanghai 

Xian 

Ningbo 

Ningbo Junee Gifts Designers & Manufacturers Co., Ltd 

Ningbo 

Qingdao Allite Radiance Candle Co., Ltd. 

Shanghai Changran Industrial & Trade Co., Ltd. 

Shanghai Daisy Gifts Manufacture Co., Ltd. 

Shanghai EGFA International Trading Co., Ltd. 

Shanghai Huge Scents Factory 

Shanghai Kongde Arts & Crafts Co., Ltd. 

Shenyang Shengwang Candle Co., Ltd. 

Shenyang Shenjie Candle Co., Ltd. 

Taizhou Dazhan Arts & Crafts Co., Ltd. 

Qingdao 

Shanghai 

Shanghai 

Shanghai 

Shanghai 

Shanghai 

Shenyang 

Shenyang 

Taizhou 

Xin Lian Candle Arts & Crafts Factory 

Zhongshan 

Zhaoyuan Arts & Crafts Co., Ltd. 

Huangyan, Taizhou 

Zhejiang Aishen Candle Arts & Crafts Co., Ltd. 

Jiaxing 

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27 

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Zhejiang Hong Mao Household Co., Ltd. 

Zhejiang Neeo Home Decoration Co., Ltd. 

Zhejiang Ruyi Industry Co., Ltd. 

Zhongshan  Zhongnam  Candle  Manufacturer  Co.,  Ltd.  and  its 
related  company  Zhongshan  South  Star  Arts  &  Crafts 
Manufacturing Co., Ltd. 

Taizhou 

Taizhou 

Taizhou 

Zhongshan 

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Annex II 

A  declaration  signed  by  an  official  of  the  entity  issuing  the  commercial  invoice,  in  the 
following format must appear on the valid commercial invoice referred to in Article 1(4) of 
this Regulation: 

(1) 

(2) 

The name and function of the official of the entity issuing the commercial invoice.  

The  following  declaration:  “I,  the  undersigned,  certify  that  the  [volume]  of  candles, 
tapers and the like sold for export to the European Community covered by this invoice 
was  manufactured  by  (company  name  and  address)  (TARIC  additional  code)  in  the 
People's Republic of China. I declare that the information provided in this invoice is 
complete and correct. 

Date and signature” 

EN 

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