Proposal for a Council Regulation amending Council Implementing Regulation (EU) No 1202/2009 of 7 December 2009 imposing a definitive anti-dumping duty on imports of furfuryl alcohol originating in the Peoples Republic of China following a 'new exporter' review pursuant to Article 11(4) of Regulation (EC) No 1225/2009
Date: 2010-02-09
Institutions: European Commission
Subjects: China, anti-dumping duty, anti-dumping legislation, chemical alcohol, import, originating product

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EUROPEAN COMMISSION 

Brussels, 9.2.2010 
COM(2010) 48 final 

2010/0033 (NLE) 

Proposal for a 

COUNCIL REGULATION 

amending Council Implementing Regulation (EU) No 1202/2009 of 7 December 2009 
imposing a definitive anti-dumping duty on imports of furfuryl alcohol originating in the 
People’s Republic of China following a 'new exporter' review pursuant to Article 11(4) 
of Regulation (EC) No 1225/2009 

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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  1225/2009  of 
30 November 2009 on protection against dumped imports from countries not members 
of  the  European  Community  (‘the  basic  Regulation’)  in  the  proceeding  concerning 
imports  of  furfuryl  alcohol  originating  in  the  People's  Republic  of  China  following  a 
'new exporter' review. 

•  General context 

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

•  Existing provisions in the area of the proposal 

Council Regulation (EC) No 1202/2009 concerning the extension of the anti-dumping 
measures  applicable  to  imports  of  furfuryl  alcohol  from  the  People's  Republic  of 
China,  imposed  by  Regulation  (EC)  No  1905/2003,  for  an  additional  period  of  two 
years. 

•  Consistency with other policies and objectives of the Union 

Not applicable. 

2. 

CONSULTATION OF INTERESTED PARTIES AND IMPACT ASSESSMENT 

•  Consultation of interested parties 

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

•  Collection and use of expertise 

There was no need for external expertise. 

•  Impact assessment 

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

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

3. 

LEGAL ELEMENTS OF THE PROPOSAL 

•  Summary of the proposed action 

On 17 June 2009, the Commission initiated a 'new exporter' review of Regulation (EC) 
1905/2003  imposing  definitive  anti-dumping  measures  on  imports  of  furfuryl  alcohol 

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originating in the People's Republic of China ('PRC'). 

The attached proposal for a Council Regulation is based on the definitive findings on 
dumping  which  showed  that  market  economy  treatment  (MET)  should  be  granted  to 
the applicant and that the applicant was found to be dumping. The anti-dumping duty 
on imports of furfuryl alcohol from the applicant is therefore established at EUR 142 
per ton, corresponding to a dumping margin of 14.87%.  

It is therefore proposed that the Council adopt the attached proposal for a Regulation 
which should be published no later than 15 March 2010. 

•  Legal basis 

Council  Regulation  (EC)  No  1225/2009  of  30  November  2009  on  protection  against 
dumped imports from countries not members of the European Community. 

•  Subsidiarity principle 

The  proposal  falls  under  the  exclusive  competence  of  the  Union.  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 Union, national 
governments,  regional  and  local  authorities,  economic  operators  and  citizens  is 
minimized and proportionate to the objective of the proposal is not applicable. 

•  Choice of instruments 

Proposed instrument: Regulation. 

Other means would not be adequate for the following reason: 

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

BUDGETARY IMPLICATION 
The proposal has no implication for the Union budget. 

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2010/0033 (NLE) 

Proposal for a 

COUNCIL REGULATION 

amending Council Implementing Regulation (EU) No 1202/2009 of 7 December 2009 
imposing a definitive anti-dumping duty on imports of furfuryl alcohol originating in the 
People’s Republic of China following a 'new exporter' review pursuant to Article 11(4) 
of Regulation (EC) No 1225/2009 

THE COUNCIL OF THE EUROPEAN UNION, 

Having regard to the Treaty on the Functioning of the European Union, 

Having regard to Council Regulation (EC) No 1225/2009 of 30 November 2009 on protection 
against dumped imports from countries not members of the European Community1 (‘the basic 
Regulation’), and in particular Article 9(4) and 11(4) thereof, 

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

Whereas: 

(1) 

(2) 

(3) 

A. MEASURES IN FORCE 

In October 2003, the Council, by Regulation (EC) No 1905/20032, imposed definitive 
anti-dumping  measures  in  the  form  of  a  specific  duty  on  imports  of  furfuryl  alcohol 
(FA) originating in the People’s Republic of China (PRC). The specific duty amounts 
ranged  from  EUR  84  to  EUR  160  per  ton  for  four  cooperating  Chinese  producers, 
while the country-wide duty was set at EUR 250 per ton.  

In  December  2009,  following  an  expiry  review,  the  Council,  by  Regulation 
1202/20093,  extended  the  anti-dumping  measures  applicable  on  imports  of  FA  from 
PRC,  imposed  by  Regulation  (EC)  No  1905/2003  for  an  additional  period  of  two 
years.  

B. CURRENT PROCEDURE 

1.  Request for a review 

Subsequent  to  the  imposition  of  definitive  measures,  the  Commission  received  a 
request for a 'new exporter' review pursuant to Article 11(4) of the basic Regulation. 
The  request  was  based  on  the  claim  that  the  exporting  producer  Henan  Hongye 
Chemical Company Ltd and its related companies Puyang Hongjian Resin Science & 
Technology Development Company Ltd and Puyang Hongye Imp. & Exp. Commerce 
Company ltd (the applicant)  

(i)  did  not  export  FA  before  or  during  the  investigation  period  of  the  original 
investigation (1 July 2001 to 30 June 2002); 

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OJ L 343, 22.12.2009, p. 51. 
OJ L 283, 31.10.2003, p. 1. 
OJ L 323, 10.12.2009, p. 48. 

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(ii)  was  not  related  to  any  of  the  exporting  producers  subject  to  the  measures 
imposed by Regulation (EC) No 1905/2003; 

(iii) had started to export FA to the Union after the end of the investigation period of 
the original investigation; 

(iv)  operates  under  market  economy  conditions  as  defined  in  Article  2(7)(c)  of  the 
basic  Regulation  or  alternatively  claims  individual  treatment  in  conformity  with 
Article 9(5) of the basic Regulation. 

2. 

Initiation of a 'new exporter' review 

The  Commission  examined  the  prima  facie  evidence  submitted  by  the  applicant  and 
considered it sufficient to justify the initiation of a review pursuant to Article 11(4) of 
the  basic  Regulation.  After  consulting  the  Advisory  Committee  and  after  the  Union 
industry  concerned  had  been  given  the  opportunity  to  comment,  the  Commission 
initiated, by Commission Regulation (EC) No 512/20094, a review of Regulation (EC) 
No 1905/2003 with regard to the applicant.  

Pursuant to Article 2 of Regulation (EU) No 512/2009, the anti-dumping duty imposed 
by  Regulation  (EC)  No  1905/2003  on  imports  of  FA  produced  by  the  applicant  and 
sold for export to the Union was repealed. Simultaneously, pursuant to Article 14(5) of 
the  basic  Regulation,  customs  authorities  were  directed  to  take  appropriate  steps  to 
register such imports. 

3. 

Product concerned 

The  product  concerned  by  the  current  review  is  the  same  as  that  described  in  the 
original Regulation, i.e. FA originating in the PRC, currently falling within CN code 
ex 2932 13 00. 

4. 

Parties concerned 

The  Commission  officially  advised 
industry  and 
representatives of the exporting country of the initiation of the 'new exporter' review. 
Interested  parties  were  given  the  opportunity  to  make  their  views  known  in  writing 
and to be heard. The Union industry submitted its views in writing.  

the  applicant, 

the  Union 

(4) 

(5) 

(6) 

(7) 

5.  Review investigation period 

(8) 

The investigation of dumping covered the period from 1 June  2008 to  31 May 2009 
(review investigation period).  

C. RESULTS OF THE INVESTIGATION 

1. 

'New exporter' qualification 

(9) 

The investigation confirmed that the applicant had not exported the product concerned 
during the original period of investigation and that it had begun exporting to the Union 
after this period. 

(10)  Furthermore, the applicant was able to demonstrate that it was not related to any of the 
exporting  producers  in  the  PRC  subject  to  the  anti-dumping  measures  in  force  with 
regard to the product concerned.  

(11)  Accordingly, it is confirmed that the applicant should be considered a 'new exporter' in 

accordance with Article 11(4) of the basic Regulation.  

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OJ L 153, 17.06.2009, p. 6. 

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2.  Market economy treatment (MET) 

(12)  Pursuant  to  Article  2(7)(b)  of  the  basic  Regulation,  in  anti-dumping  investigations 
concerning  imports  from  the  PRC,  normal  value  shall  be  determined  in  accordance 
with paragraphs of the said Article for those producers which were found to meet the 
criteria laid down in Article 2(7)(c) of the basic Regulation, i.e. where it is shown that 
market  conditions  prevail  in  respect  of  the  manufacture  and  sale  of  the  like  product. 
These criteria are set out in summarised form below:  

1. 

2. 

3. 

4. 

5. 

business  decisions  and  costs  are  made  in  response  to  market  signals  and 
without  significant  State  interference;  and  costs  of  major  inputs  substantially 
reflect market values; 

firms  have  one  clear  set  of  basic  accounting records which are independently 
audited in line with international accounting standards5 and are applied for all 
purposes; 

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

bankruptcy and property laws guarantee legal certainty and stability; 

currency exchange-rate conversions are carried out at market rates. 

(13)  The Commission sought all information deemed necessary and verified all information 

submitted in the MET application at the premises of the applicant.  

(14)  The investigation showed that all five criteria laid down in Article 2(7)(c) of the basic 
Regulation were met by the applicant. It was therefore considered that MET should be 
granted to the applicant.  

3.  Dumping 

Normal value 

(15)  As  far  as  the  determination  of  normal  value  is  concerned,  the  Commission  first 
established  whether  the  total  domestic  sales  of  the  product  concerned  made  by  the 
applicant were representative in comparison with its total export sales to the Union. In 
accordance  with  Article  2(2)  of  the  basic  Regulation,  domestic  sales  are  considered 
representative when the total domestic sales volume is at least 5 % of the total export 
sales  volume  to  the  Union.  The  Commission  established  that  FA  was  sold 
domestically by the applicant in overall representative volumes.  

(16)  An  examination  was  also  made  as  to  whether  the  sales  of  FA  sold  domestically  in 
representative quantities could be regarded as having been made in the ordinary course 
of  trade,  by  establishing  the  proportion  of  profitable  sales  of  FA  to  independent 
customers.  As  it  was  found  that  there  were  sufficient  sales  in  the  ordinary  course  of 
trade, normal value was based on the actual domestic price of profitable sales. 

Export price 

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International  accounting  standards refer  to all  major  recognised  international  standards  of  accounting, 
including  US  GAAP  and  the  works  of  the  International  Accounting  Standard  Committee  Foundation 
('IASCF')  effectuated  by  the  International  Accounting  Standards  Board  ('IASB'),  covering  the 
International Accounting Standard Board Framework ('IASBF'), the International Accounting Standard 
('IAS'),  the  International  Financial  Reporting  Standards  ('IFRS')  and  the  International  Financial 
Reporting Interpretations Committee publications ('IFRIC'). 

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(17)  As  the  product  concerned  was  exported  directly  to  an  independent  customer  in  the 
Union,  the  export  price  was  established  in  accordance  with  Article  2(8)  of  the  basic 
Regulation, i.e. on the basis of export price actually paid or payable.  

Comparison 

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

basis.  

(19)  For the purpose of ensuring a fair comparison between the normal value and the export 
price,  due  allowance  in  the  form  of  adjustments  was  made  for  differences  affecting 
prices  and  price  comparability  in  accordance  with  Article  2(10)  of  the  basic 
Regulation. Allowances for transport costs, freight and insurance costs, bank charges, 
packing costs and credit costs were granted where they were found to be reasonable, 
accurate and supported by verified evidence.  

Dumping margin 

(20)  Pursuant  to  Article  2(11)  of  the  basic  Regulation,  and  taking  into  account  that  there 
was  only  one  export  transaction  to  the  Union  during  the  review  investigation  period 
and  that  the  price  of  the  raw  material,  which  accounts  for  most  of  the  cost  of 
production,  and  of  the  domestic  sales  fluctuated  substantially  during  that  period,  the 
dumping  margin  was  established  on  the  basis  of  a  comparison  on  a  transaction-to-
transaction basis between the normal value and the export price.  

(21)  The  dumping  margin  for  the  applicant  thus  calculated  is  14.87%,  expressed  as  a 

percentage of the net, free-at-Union-frontier price, duty unpaid.  

D. AMENDMENT OF MEASURES BEING REVIEWED  

(22) 

In view of the findings of the investigation and in accordance with the lesser duty rule, 
it is  concluded  that  a definitive anti-dumping  should  be  imposed  for  the applicant at 
the  level  of  the  dumping  margin  found,  which  is  in  this  case  lower  than  the  injury 
margin in the original case.  

(23)  Regarding the form of the measure, it was considered that the amended anti-dumping 
duty  should  take  the  same  form  as  the  duties  imposed  by  Regulation  (EU)  No 
1202/2009,  i.e.  the  form  of  a  specific  amount  per  ton.  The  anti-dumping  duty, 
calculated  on  the  basis  of  the  dumping  margin  expressed  as  a  percentage  of  the  net, 
free-at-Union-frontier  price,  duty  unpaid,  to  imports  of  FA  from  the  applicant  is 
therefore established at EUR 142 per ton. 

E. RETROACTIVE LEVYING OF THE ANTI-DUMPING DUTY 

(24) 

In  the  light  of  the  above  findings,  the  anti-dumping  duty  applicable  to  the  applicant 
shall  be  levied  retroactively  on  imports  of  the  product  concerned  which  have  been 
made subject to registration pursuant to Article 3 of Commission Regulation (EC) No 
512/2009. 

F. DISCLOSURE 

(25)  The parties concerned were informed of the essential facts and considerations on the 
basis  of  which  it  was  intended  to  impose  on  imports  of  FA  from  the  applicant  an 
amended  definitive  anti-dumping  duty  and  to  levy  this  duty  retroactively  on  imports 
made  subject  to  the  registration.  Comments  were  received  from  the  Union  industry, 
which however, were not of a nature to change the above conclusions.  

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(26)  This  review  does  not  affect  the  date  on  which  the  measures  imposed  by  Regulation 

(EU) No 1202/2009 will expire. 

HAS ADOPTED THIS REGULATION: 

Article 1 

The table in Article 1(2) of Council Implementing Regulation (EU) No 1202/2009 is 

1. 
hereby amended by adding the following: 

Company 

Rate of anti-dumping duty 
(EUR/tonne) 

TARIC additional code 

142 

A955 

Henan Hongye Chemical Co. 
Ltd and its related companies 
Puyang  Hongjian  Resin 
Technology 
Science  & 
Development  Company  ltd, 
Hongye  Chemical  Company 
ltd  and  Puyang  Hongye  Imp. 
&  Exp.  Commerce  Company 
ltd  

2. 
The duty hereby imposed shall also be levied retroactively on imports of the product 
concerned which have been registered pursuant to Article 3 of Commission Regulation (EC) 
No 512/2009. 

The customs authorities are hereby directed to cease the registration of imports of the product 
concerned originating in the People’s Republic of China produced and sold for export to the 
Union by Henan Hongye Chemical Company Ltd and its related companies Puyang Hongjian 
Resin Science & Technology Development Company Ltd and Puyang Hongye Imp. & Exp. 
Commerce Company Ltd. 

3. 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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