Proposal for a Council Regulation amending Regulation (EC) No 1890/2005 imposing a definitive anti-dumping duty on imports of certain stainless steel fasteners and parts thereof originating, inter alia, in Vietnam
Date: 2009-07-27
Institutions: European Commission
Subjects: Viet Nam, anti-dumping duty, anti-dumping legislation, import policy, manufactured goods, metal product, spare part, steel

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COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 27.7.2009 
COM(2009) 396 final 

Proposal for a 

COUNCIL REGULATION 

amending Regulation (EC) No 1890/2005 imposing a definitive anti-dumping duty on 
imports of certain stainless steel fasteners and parts thereof originating, inter alia, in 
Vietnam 

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EXPLANATORY MEMORANDUM 

CONTEXT OF THE PROPOSAL 

Grounds for and objectives of the proposal 

This  proposal  concerns  the  application  of  Council  Regulation  (EC)  No  384/96  of 
22 December 1995 on protection against dumped imports from countries not members 
of  the  European  Community,  as  last  amended  by  Council  Regulation  (EC) 
No 2117/2005  of  21  December  2005  ('the  basic  Regulation')  in  the  proceeding 
concerning imports of stainless steel fasteners originating, inter alia, in Vietnam. 

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 

The measures currently in force were imposed by Council Regulation (EC) No 1890/2005 
imposing a definitive  anti-dumping  duty on imports  of  certain  stainless  steel  fasteners 
and parts thereof originating, inter alia, in Vietnam. 

Consistency with the other policies and objectives of the Union 

Not applicable. 

CONSULTATION OF INTERESTED PARTIES AND IMPACT ASSESSMENT 

Consultation of interested parties 

Interested parties concerned by the 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. 

LEGAL ELEMENTS OF THE PROPOSAL 

Summary of the proposed action 

On  13  August  2008,  the  Commission  initiated  an  interim  review  of  the  measures  in 
force in respect of stainless steel fasteners originating in Vietnam further to a request 
made  by  a  Vietnamese  exporting  producer.  The  request  was  based  on  prima  facie 
evidence that the circumstances on the basis of which measures were established have 
changed;  i.e.  that  the  company  now  fulfils  the  criteria  for  market  economy  treatment 

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(MET) and therefore the continued imposition of measures at the existing levels would 
no longer be necessary to offset dumping. 

The  attached  proposal  for  a  Council  Regulation  is  based  on  the  findings  of  the 
investigation carried out which is limited in scope to the examination of dumping and 
as far as the applicant is concerned. 

The investigation showed that the company fulfilled the criteria to be granted MET and 
that no dumping took place during the investigation period. It was also found that the 
circumstances during the current investigation period were of a lasting nature.  

It is therefore proposed that the Council adopt the attached proposal for a Regulation 
that would amend the anti-dumping measures currently in force. 

Legal basis 

Council  Regulation  (EC)  No  384/96  of  22  December  1995  on  protection  against 
dumped  imports  from  countries  not  members  of  the  European  Community,  as  last 
amended by Council Regulation (EC) No 2117/2005 of 21 December 2005.  

Subsidiarity principle 

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

Proportionality principle 

The proposal complies with the proportionality principle for the following reasons:  

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

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

Choice of instruments 

Proposed instruments: Amending Regulation. 

Other  means  would  not  be  adequate  for  the  following  reason:  The  above-mentioned 
basic Regulation does not foresee alternative options. 

BUDGETARY IMPLICATION 

The proposal has no implication for the Community budget. 

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Proposal for a 

COUNCIL REGULATION 

amending Regulation (EC) No 1890/2005 imposing a definitive anti-dumping duty on 
imports of certain stainless steel fasteners and parts thereof originating, inter alia, in 
Vietnam 

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 11(3) thereof, 

Having regard to Council Regulation (EC) No 1890/2005 imposing a definitive anti-dumping 
duty and collecting definitively the provisional duty imposed on imports of certain stainless 
steel  fasteners  and  parts  thereof  originating  in  the  People’s  Republic  of  China,  Indonesia, 
Taiwan, Thailand and Vietnam and terminating the proceeding on imports of certain stainless 
steel fasteners and parts thereof originating in Malaysia and the Philippines2, 

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

Whereas: 

1. MEASURES IN FORCE 

A. PROCEDURE 

(1) 

By  Regulation  (EC)  No  1890/2005,  the  Council  imposed  a  definitive  anti-dumping 
duty on imports of stainless steel fasteners and parts thereof (‘SSF’) originating, inter 
alia,  in  Vietnam.  This  regulation  will  hereinafter  be  referred  to  as  'the  original 
Regulation'  and  the  investigation  that  led  to  the  measures  imposed  by  the  original 
Regulation will be hereinafter referred to as 'the original investigation'.  

2. REQUEST FOR A REVIEW  

(2) 

(3) 

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A request for a partial interim review ('the present review') pursuant to Article 11(3) of 
the  basic  Regulation  was  lodged  by  Header  Plan  Co.,  Ltd.,  a  Vietnamese  exporting 
producer  of  SSF  ('the  applicant'  or  ‘HPV’).  The  request  was  limited  in  scope  to 
dumping and to the applicant company. 

The  applicant  provided  prima  facie  evidence  that  the  continued  application  of  the 
measure at its current level was no longer necessary to offset dumping. In particular, 
the  applicant  provided  prima  facie  evidence  showing  that  it  meets  the  criteria  for 
market  economy  treatment  and  individual  treatment.  Furthermore,  in  the  absence  of 

OJ  L  56,  6.3.1996,  p.  1.  Regulation  as  last  amended  by  Regulation  (EC)  No  2117/2005  (OJ  L  340, 
23.12.2005, p. 17). 
OJ L 302, 19.11.2005, p. 1. 

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domestic  sales,  a  comparison  of  its  costs  of  production  and  export  prices  to  the 
Community indicated that the dumping margin appeared to be substantially lower than 
the current level of the measure. 

3. INVESTIGATION 

(4) 

(5) 

(6) 

(7) 

(8) 

(9) 

Having  determined,  after  consulting  the  Advisory  Committee,  that  the  request 
contained  sufficient  prima  facie  evidence,  the  Commission  announced  on  13  August 
2008  the  initiation  of  a  partial  interim  review  pursuant  to  Article  11(3)  of  the  basic 
Regulation by a notice of initiation published in the Official Journal of the European 
Union3. 

The  review  was  limited  in  scope  to  the  examination  of  dumping  in  respect  of  the 
applicant.  The  investigation  of  dumping  covered  the  period  from  1  July  2007  to  30 
June 2008 ('the review investigation period' or 'RIP'). 

The Commission officially informed the applicant, the representatives of the exporting 
country and the association of Community producers about the initiation of the review. 
Interested  parties  were  given  the  opportunity  to  make  their  views  known  in  writing 
and to request a hearing within the time limit set in the notice of initiation. 

All interested parties, who so requested and showed that there were particular reasons 
why they should be heard, were granted a hearing. 

In  order  to  obtain  the  information  deemed  necessary  for  its  investigation,  the 
Commission sent a market economy treatment (‘MET’) and individual treatment (‘IT’) 
claim  form  and  a  questionnaire  to  the  applicant  and  received  replies  within  the 
deadlines set for that purpose.  

The  Commission  sought  and  verified  all  information  deemed  necessary  for  the 
determination  of  dumping.  The  Commission  carried  out  verification  visits  at  the 
premises of the applicant and its related company: 

– 

– 

Header Plan Co. Ltd. ('Header Plan'), Binh Hoa County, Vietnam, 

Header Plan Inc, Taipei, Taiwan. 

(10) 

In view of the possible need to establish some elements (SG&A cost and profit rate) of 
the  normal  value  as  explained  in  recitals  (22)  to  (25)  below,  verification  visits  to 
establish  these  rates  on  the  basis  of  data  from  another  country,  in  this  case  Taiwan, 
took place at the premises of the following companies: 

– 

– 

Jin Shing Stainless Ind. Co. Ltd, Taoyuan, 

Yi Tai Shen Co. Ltd, Tainan. 

B. PRODUCT CONCERNED AND LIKE PRODUCT 

1. PRODUCT CONCERNED 

(11)  The  product  concerned  by  the  present  review  is  the  same  as  that  in  the  original 
investigation,  i.e.  certain  SSF  and  parts  thereof  (‘the  product  concerned’).  It  is 
currently classifiable within CN codes 7318 12 10, 7318 14 10, 7318 15 30, 7318 15 
51, 7318 15 61 and 7318 15 70. There are many types of SSF (the most common ones 
are  bolts  and  screws),  each  one  being  defined  by  its  specific  physical  and  technical 
characteristics and by the grade of stainless steel from which it is made. 

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OJ C 206, 13.8.2008, p. 12. 

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2. LIKE PRODUCT 

(12)  The investigation revealed that the applicant did not sell the product concerned on the 
Vietnamese  domestic  market.  It  also  showed  that  SSF  produced  and  sold  on  the 
Taiwanese domestic market and those exported to the Community from Vietnam have 
the  same  physical,  chemical  and  technical  characteristics  and  uses.  It  is  therefore 
concluded  that  all  are  like  products  within  the  meaning  of  Article  1(4)  of  the  basic 
Regulation. Since the present review was limited to the determination of dumping as 
far  as  the  applicant  is  concerned,  no  conclusions  were  reached  with  regard  to  the 
product produced and sold by the Community industry on the Community market.  

C. RESULTS OF THE INVESTIGATION  

1. MARKET ECONOMY TREATMENT (MET) 

(13) 

In  anti-dumping  investigations  concerning  imports  originating  in  Vietnam,  normal 
value  shall  be  determined  in  accordance  with  paragraphs  1  to  6  of  Article  2  of  the 
basic Regulation for those producers which were found to meet the criteria laid down 
in Article 2(7)(c).  

(14)  Briefly,  and  for  ease  of  reference  only,  the  criteria  in  Article  2(7)(c)  of  the  Basic 
Regulation, fulfilment of which the applicant companies have to demonstrate, are set 
out in summarised form below:  

– 

– 

– 

– 

– 

business  decisions  and  costs  are  made  in  response  to  market  conditions,  and 
without significant State interference; 

accounting  records  are  independently  audited  in  line  with  international 
accounting standards and applied for all purposes;  

there  are  no  significant  distortions  carried  over  from  the  former  non-market 
economy system;  

legal certainty and stability are provided by bankruptcy and property laws;  

currency exchanges are carried out at the market rate. 

(15)  The applicant requested market economy treatment pursuant to Article 2(7)(b) of the 
basic  Regulation  and  submitted  a  claim  form  for  exporting  producers.  The 
Commission  sought  and  verified  at  the  premises  of  the  applicant  all  information 
submitted in the company's request and deemed necessary. 

(16)  The present investigation revealed that the situation of the applicant changed since the 
original investigation. It was found that the applicant now meets all five MET criteria. 
In  particular,  the  reasons  why  MET  was  denied  in  the  original  investigation  were 
found to be no longer applicable and no other circumstances were found which could 
lead  to  a  rejection  of  the  MET  claim.  Therefore,  after  consulting  the  Advisory 
Committee, the applicant was granted MET. 

(17)  Both the applicant and the Community industry were given an opportunity to comment 

on the above findings. 

(18)  The Community industry objected to the above findings by claiming that there would 
be a risk of circumvention by channelling exports from Taiwan via Vietnam.  

(19) 

It should first be noted that there is no link between granting MET to the applicant and 
any potential circumvention from Taiwan, since this may even be possible in case no 
MET  is  granted  to  the  applicant.  Secondly,  the  Community  industry  did  not  come 
forward  with  any  underlying  evidence  supporting  the  allegations  made.  Finally,  it  is 

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underlined that the Community industry did not object to the above findings, i.e. that 
the  applicant  fulfilled  the  criteria  listed  in  Article  2(7)(c)  of  the  basic  Regulation, 
which  are  the  only  relevant  criteria  to  assess  whether  the  company  fulfilled  the 
conditions to be granted MET. The claims of the Community industry had therefore to 
be rejected.  

2. DUMPING 

2.1 Normal value  

(20)  The applicant had no domestic sales in Vietnam of the product concerned. Whenever 
domestic prices cannot be used in order to establish normal value, another method has 
to be applied. In accordance with Article 2(3) of the basic Regulation the Commission 
instead calculated a constructed normal value, as follows. 

(21)  Normal  value  was  constructed  by  adding  to  the  applicant’s  manufacturing  costs  a 
reasonable  amount  for  selling,  general  and  administrative  expenses  (SG&A)  and  a 
reasonable margin of profit. 

(22)  Since  the  applicant  had  no  domestic  sales  of  the  product  concerned  or  of  the  same 
general  category  of  product,  and  because  the  investigation  was  limited  to  one 
company, SG&A costs and profits could not be established pursuant to the methods set 
out  in  Article  2(6)(a)  and  Article  2(6)(b)  of  the  basic  Regulation.  Instead,  another 
reasonable method had to be found based on Article 2(6)(c) of the basic Regulation.  

(23) 

In  the  event  that  the  applicant  would  be  granted  market  economy  treatment,  it  was 
foreseen  in  point  5(d)  of  the  notice  of  initiation,  to  also  use  findings  concerning  the 
normal  value  established  in  an  appropriate  market  economy  country,  e.g.  for  the 
purpose  of  replacing  any  unreliable  cost  or  price  elements  in  Vietnam  which  are 
needed in establishing the normal value, if reliable required data are not available in 
Vietnam. It was found reasonable to use the SG&A costs and profit rates of exporting 
producers  of  the  like  product  in  another  country,  in  this  case  Taiwan,  according  to 
Article 2(6)(c) of the basic Regulation. 

(24)  The domestic sales of the Taiwanese producers were found to have been made in the 
ordinary  course  of  trade.  Consequently,  the  SG&A  costs  and  profit  rates  were 
calculated on their proportion to the total turnover for each product type. 

(25)  The weighted average SG&A costs and profit rate of the Taiwanese companies were 
added  to  the  manufacturing  cost  of  the  applicant  to  establish  the  constructed  normal 
value. 

2.2 Export price 

(26)  All sales of the products concerned to the Community during the investigation period 
were  made  by  a  related  company  in  Taiwan.  Export  prices  were  established  in 
accordance with Article 2(9) of the basic Regulation, i.e. using the prices actually paid 
or payable to the related company by the first independent buyer in the Community in 
the RIP. 

2.3 Comparison 

(27)  The  comparison  between  normal  value  and  export  price  was  made  on  an  ex-factory 

basis. 

(28)  For the purpose of ensuring a fair comparison between the normal value and the export 
price,  due  allowance  in  the  form  of  adjustments  was  made  for  differences  affecting 
price and price comparability in accordance with Article 2(10) of the basic Regulation. 

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Accordingly, adjustments were made for differences in transport, packing, credit cost, 
bank charges, commissions, rebates and insurance where applicable and supported by 
verified evidence. Appropriate adjustments were granted in all cases where they were 
found to be reasonable, accurate and supported by verified evidence. 

2.4 Dumping margin 

(29)  The  dumping  margin  was  established  on  the  basis  of  a  comparison  of  a  weighted 
average normal value with a weighted average export price, in accordance with Article 
2(11) of the basic Regulation. 

(30)  The comparison as described above showed the existence of no dumping.  

3. LASTING NATURE OF THE CIRCUMSTANCES PREVAILING DURING THE RIP 

(31) 

In accordance with Article 11(3) of the basic Regulation, it was examined whether the 
circumstances  on  the  basis  of  which  the  current  dumping  margin  was  based  have 
changed and whether such change was of a lasting nature. 

(32)  Firstly it should be noted that the applicant was able to prove that it should be granted 
MET, and was therefore eligible for its own individual dumping margin. There was no 
indication that this situation would change in the foreseeable future. 

(33)  The price of the product concerned charged to the Community and to third countries 
did not differ significantly and followed the same trend between 2005 and the IP.  

(34)  The  investigation  showed  that  the  behaviour  of  the  applicant,  including  the 
circumstances that led to the initiation of the present review, were unlikely to change 
in  the  foreseeable  future  in  a  manner  that  would  affect  the  findings  of  the  present 
review.  This  would  therefore  suggest  that  the  changes  concerned  were  of  a  lasting 
nature and therefore the conclusions of the review were long-lasting. 

D. AMENDMENT OF THE MEASURES 

(35) 

In  view  of  the  findings  of  no  dumping  as  well  as  the  lasting  nature  of  the  changed 
circumstances,  it  is  considered  that  the  continued  imposition  of  the  measure  on 
imports from the applicant in not necessary to offset dumping. Therefore the measures 
imposed by Council Regulation (EC) No 1890/2005 on imports of SSF originating in 
Vietnam should be repealed for HPV by amending that Regulation accordingly. 

(36)  The  applicant  as  well  as  the  other  parties  concerned  were  informed  of  the  facts  and 
considerations  on  the  basis  of  which  it  was  intended  to  propose  the  repeal  of  the 
measures.  No  comments  were  received  which  would  warrant  a  change  in  the  above 
conclusions. 

HAS ADOPTED THIS REGULATION: 

1. The part of the table in Article 1, paragraph 3 of Regulation (EC) No 1890/2005 concerning 
the definitive anti-dumping duty applicable on imports of certain stainless steel fasteners and 
parts thereof originating in Vietnam shall be replaced by the following: 

Article 1 

Country 

Exporting producer 

Rate of 
duty (%)

TARIC 
additional code 

Vietnam 

Header Plan Co. Ltd. 

0 

A958 

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All other companies 

7,7 

A999 

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

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

Article 2 

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

Done at Brussels, […] 

For the Council 
The President 

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