Proposal for a COUNCIL REGULATION imposing a definitive anti-dumping duty and collecting definitively the provisional duty imposed on imports of sodium gluconate originating in the People’s Republic of China
Date: 2010-09-30
Institutions: European Commission
Subjects: China, anti-dumping duty, import, organic chemical, originating product

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EUROPEAN COMMISSION 

Brussels, 30.9.2010 
COM(2010) 536 final 

2010/0268 (NLE) 

Proposal for a 

COUNCIL REGULATION  

imposing a definitive anti-dumping duty and collecting definitively the provisional duty 
imposed on imports of sodium gluconate 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 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 dry sodium gluconate originating in the People’s Republic of China ('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 

By Regulation (EU)  No  377/2010  the Commission  imposed  provisional anti-dumping 
measures  on  imports  of  dry  sodium  gluconate  originating  in  the  People's  Republic  of 
China. 

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 11 August 2009, the Commission initiated an anti-dumping proceeding concerning 
imports of dry sodium gluconate originating in the People's Republic of China. 

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The investigation found dumping of the product concerned, which caused injury to the 
Union industry. The investigation also found that it was not against the Union interest 
to impose anti-dumping measures. On this basis, provisional measures were imposed by 
Commission  Regulation  (EU)  No  377/2010.  The  attached  proposal  for  a  Council 
Regulation is based on the definitive findings on dumping, injury, causation and Union 
interest which confirmed the provisional findings regarding imports from the People's 
Republic  of  China.  In  addition,  based  on  additional  data  collected  from  interested 
parties,  the  level  of  the  anti-dumping  duty  for  one  cooperating  exporting  producer  as 
well as the level of the residual anti-dumping duty were slightly revised downwards. 

It is therefore proposed that the Council adopts the attached proposal for a Regulation 
in order to impose definitive measures on imports of dry sodium gluconate originating 
in  the  People's  Republic  of  China  and  to  collect  definitively  the  provisional  duty 
imposed on these imports. 

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 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 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  because  the  basic  Regulation  does  not  foresee 
alternative options. 

4. 

Budgetary implication 

The proposal has no implication for the Union budget. 

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2010/0268 (NLE) 

Proposal for a 

COUNCIL REGULATION 

imposing a definitive anti-dumping duty and collecting definitively the provisional duty 
imposed on imports of sodium gluconate originating in the People’s Republic of China 

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 thereof, 

Having  regard  to  the  proposal  submitted  by  the  European  Commission  ('the  Commission'), 
after consulting the Advisory Committee, 

Whereas: 

1. 

PROCEDURE 

1.1. 

Provisional measures 

(1) 

(2) 

(3) 

The  Commission  by  Regulation  (EU)  No  377/20102  (the  'provisional  Regulation') 
imposed  a  provisional  anti-dumping  duty  on  imports  of  dry  sodium  gluconate 
originating in the People’s Republic of China ('China' or 'country concerned'). 

It  is  recalled  that  the  proceeding  was  initiated  following  a  complaint  lodged  by  the 
European  Chemical  Industry  Council  (CEFIC)  ('the  complainant')  on  behalf  of 
producers representing 100% of the total Union production. 

As set out in recital (13) of the provisional Regulation, the investigation of dumping 
and injury covered the period from 1 July 2008 to 30 June 2009 ('investigation period' 
or 'IP'). With respect to the trends relevant for the injury assessment, the Commission 
analysed  data  covering  the  period  from  1  January  2005  to  the  end  of  the  IP  ('period 
considered'). 

1.2. 

Subsequent procedure 

1 
2 

OJ L 343, 22.12.2009, p.51 
OJ L 111, 4.5.2010, p. 5. 

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(4) 

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  known  their 
views  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.  To  this  end  verification  visits  were 
carried out at the following companies: 

Producers in the Union: 

– 

– 

Roquette GmbH, Germany; 

Roquette UK, United Kingdom. 

(5) 

(6) 

2. 

(7) 

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 dry sodium gluconate originating in China and the definitive 
collection  of  the  amounts  secured  by  way  of  the  provisional  duty  ('final  disclosure'). 
They  were  also  granted  a  period  within  which  they  could  make  representations 
subsequent to this disclosure. 

The  oral  and  written  comments  submitted  by  the  interested  parties  were  considered 
and, where appropriate, the provisional findings were modified accordingly. 

PRODUCT CONCERNED AND LIKE PRODUCT 

In the absence of any comments concerning the product concerned or the like product, 
recitals (14) to (17) of the provisional Regulation are hereby confirmed. 

3. 

DUMPING 

3.1.  Market economy treatment (MET) 

(8) 

(9) 

The Union industry (UI) reiterated its reservations on the MET granted to the Chinese 
exporting  producer,  Shandong  Kaison  Biochemical,  without  providing  any  new 
elements to support them.  

The UI further claimed, without providing any evidence, that the raw materials used to 
produce  dry  sodium  gluconate  in  China  were  exempt  from  VAT  and  that  the  buyer 
could be reimbursed a "virtual VAT" of 13% to 17% on their purchases. In this regard, 
it was found that to produce dry sodium gluconate, the raw material (corn starch) was 
purchased from several industrial suppliers that process the corn (agricultural product) 
into corn starch. Furthermore, the prices of corn starch in major regions of the world 
were  examined  and  there  were  no  indications  that  Chinese  users  of  corn  starch 
obtained  the  product  at  favourable  prices.  In  addition,  several  purchase  invoices  for 
corn  starch  were  checked  and  all  of  them  carried  VAT.  In  addition,  there  was  no 
evidence  that  "virtual  VAT"  was  reimbursed  on  purchases.  These  claims  were 
therefore rejected. 

(10) 

In the absence of any other comments with regard to MET, recitals (18) to (21) of the 
provisional Regulation are hereby confirmed.  

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3.2. 

Individual treatment (IT) 

(11) 

In the absence of any comments with regard to individual treatment (IT), recitals (22) 
to (25) of the provisional Regulation are hereby confirmed. 

3.3. 

Normal value 

3.3.1.  Analogue country 

(12) 

In the absence of any comments with regard to the analogue country, recitals (26) to 
(32) of the provisional Regulation are hereby confirmed. 

3.3.2.  Methodology applied for the determination of the normal value 

3.3.2.1.  For the company granted MET 

(13) 

It should be clarified that, as a result of applying the methodology described in recitals 
(33)  to  (38)  of  the  provisional  Regulation,  the  normal  value  was  not  based  on  the 
actual domestic price of all transactions, as stated in recital (39) of that Regulation, but 
only  on  the  profitable  sales  since  the  volume  of  profitable  sales  represented  80%  or 
less of the total sales volume. 

(14) 

In  the  absence  of  any  other  comments  with  regard  to  the  methodology  for  the 
determination of the normal value for the company granted MET, recitals (33) to (38) 
of the provisional Regulation are hereby confirmed.  

3.3.2.2.  For the company granted IT 

(15) 

In the absence of any comments with regard to the method for calculating the normal 
value for the company granted IT, recitals (40) and (41) of the provisional Regulation 
are hereby confirmed. 

3.4. 

Export price 

(16) 

In the absence of any comments with regard to the determination of the export price, 
recital (42) of the provisional Regulation is hereby confirmed. 

3.5. 

Comparison 

(17) 

In the absence of any comments with regard to the comparison of the normal value and 
the  export  price,  recitals  (43)  and  (44)  of  the  provisional  Regulation  are  hereby 
confirmed. 

3.6. 

Dumping Margins 

(18) 

In the absence of any comments with regard to the dumping margins, recitals (45) to 
(50) of the provisional Regulation are hereby confirmed.  

(19)  The  definitive  weighted  average  dumping  margins  expressed  as  a  percentage  of  the 

CIF Union frontier price, duty unpaid, are: 

Table 1 

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Company 

Definitive dumping 
margin 

Shandong Kaison Biochemical Co., Ltd 

Qingdao Kehai Biochemistry Co. Ltd 

All other companies  

5.6% 

51.1% 

79.2% 

4. 

INJURY 

4.1. 

Definition of the Union industry and Union production 

(20) 

In the absence of any comments concerning the definition of the Union industry and 
Union  production,  recitals  (51)  to  (53)  of  the  provisional  Regulation  are  hereby 
confirmed. 

4.2. 

Union consumption 

(21) 

In the absence of any comments concerning Union consumption, recitals (54) to (55) 
of the provisional Regulation are hereby confirmed. 

4.3. 

Imports into the Union from China 

(22) 

It is noted that, as mentioned below in recital (34) of this Regulation, subsequent to the 
imposition  of  provisional  measures,  there  were  some  minor  corrections  in  the  Union 
industry's sales value.  However,  these  had no impact on the undercutting margins as 
set out in recital (59) of the provisional Regulation. Therefore recitals (56) to (59) of 
the provisional Regulation are hereby confirmed 

4.4. 

Economic situation of the Union industry 

(23)  Further  to  provisional  disclosure  one  Chinese  exporting  producer  contested  the 
provisional  findings  claiming  that  some  of  the  main  injury  indicators  showed  a 
positive development between 2008 and the IP. 

(24) 

(25) 

It should first of all be noted that while certain injury indicators showed a somewhat 
positive development between 2008 and the IP (e.g. production volume, market share 
and investments), other indicators showed negative developments (e.g. sales volumes 
and prices, as well as profitability). In this regard, it is noted that Article 3(5) of the 
basic  Regulation  provides  that  no  one  or  more  of  the  injury  indicators  is  decisive  in 
assessing whether the Union industry suffered material injury. 

In  addition,  the  period  under  consideration  covers  the  period  between  2005  and  the 
end  of  the  IP.  During  this  period  most  injury  indicators  clearly  showed  a  negative 
development  resulting  in  material  injury  during  the  IP.  The  somewhat  positive 
development  of  certain  injury  indicators  in  the  last  year  of  this  period  did  not 
undermine the finding of material injury. 

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(26)  Subsequent to the imposition of provisional measures, the replies to the questionnaire 
of two other sales branches of the Union industry were  verified at  their premises, as 
mentioned above in recital (4). 

(27)  As result of these verifications, some minor adjustments were made to the total value 
of sales in the domestic market and to the cost of production. The profitability figure 
was  also  accordingly  slightly  amended.  However,  these  changes  did  not  have  an 
impact on the trends and indexes in prices and profitability as provisionally established 
in recitals (66) and (68) as well as Tables 5 and 7 of the provisional Regulation. 

(28)  Therefore  the  conclusions  reached  at  provisional  stage,  i.e.  that  the  Union  industry 
suffered material injury within the meaning of Article 3(5) of the basic Regulation, are 
confirmed and recitals (60) to (79) of the provisional Regulation are hereby confirmed  

5. 

CAUSALITY 

(29) 

In  the  absence  of  any  comments  concerning  causality,  recitals  (80)  to  (96)  of  the 
provisional Regulation are hereby confirmed. 

6. 

UNION INTEREST 

(30)  One cooperating user claimed that any increase in costs could not be easily passed on 
to final customers; therefore duties would have a significant impact on its profitability.  

(31)  However,  the  investigation  revealed  that  this  user  made  high  profit  margins  both 
overall and on a wide range of its products. For most of the products produced by this 
user, the expected cost increase was found not to be significant due to the small part of 
dry sodium gluconate in the total production cost and it was considered that, overall, 
the expected cost increase could be absorbed without significantly affecting the overall 
profitability. The user in question did not submit any further evidence or information 
supporting its claim. Therefore this claim had to be rejected. 

(32) 

In the absence of any other comments concerning the Union interest, recitals (97) to 
(107) of the provisional Regulation are hereby confirmed. 

7. 

DEFINITIVE ANTI-DUMPING MEASURES 

7.1. 

Injury elimination level 

(33)  For  the  determination  of  the  non-injurious  price  at  definitive  stage,  the  same 
methodology was used as the one described in recitals (111) to (113) of the provisional 
Regulation.  

(34)  However, as mentioned above in recital (27), the verification of additional data of the 
Union industry led to minor corrections in the value of total domestic sales, total cost 
of production and profitability. 

(35) 

In  the  absence  of  any  other  comments  that  would  alter  the  conclusion  regarding  the 
injury  elimination  level,  recitals  (108)  to  (113)  of  the  provisional  Regulation  are 
hereby confirmed. 

7.2. 

Definitive measures 

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(36) 

In the light of the foregoing, it is considered that, in accordance with Article 9(4) of 
the basic Regulation, a definitive anti-dumping duty should be imposed on imports of 
dry sodium gluconate originating in China at the level of the lower of the dumping and 
the injury margins, in accordance with the lesser duty rule. 

(37)  The proposed definitive anti-dumping duty rates are the following: 

Table 2 

Name 

Injury 
Margin 

Dumping 
Margin 

Definitive 
duty 

Shandong Kaison Biochemical Co 
Ltd, Wulian County, Rizhao City 

Qingdao Kehai Biochemistry Co Ltd, 
Jiaonan City 

29.7% 

5.6% 

5.6% 

27.1% 

51.1% 

27.1% 

All other companies 

53.2% 

79.2% 

53.2% 

(38)  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  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'. 

(39)  Any claim requesting the application of these individual company anti-dumping duty 
rates (e.g. following a change in the name of the entity or following the setting up of 
new  production  or  sales  entities)  should  be  addressed  to  the  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  accordingly  amended  by  updating  the  list  of  companies 
benefiting from individual duty rates. 

(40) 

In  order  to  ensure  a  proper  enforcement  of  the  anti-dumping  duty,  the  country-wide 
duty level should not only apply to the non-cooperating exporting producers but also 
to those producers which did not have any exports to the Union during the IP. 

7.3. 

Definitive collection of provisional duties  

3 

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

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(41) 

In view of the magnitude of the dumping margins found and in the light of the level of 
the  injury  caused  to  the  Union  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. 

7.4. 

Special monitoring 

(42) 

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. These special measures include the following. 

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

(44)  Should  the  exports  by  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,  

HAS ADOPTED THIS REGULATION: 

Article 1 

1.  A  definitive  anti-dumping  duty  is  hereby  imposed  on  imports  of  dry  sodium  gluconate, 
with  a  Customs  Union  and  Statistics  (CUS)  number  0023277-9  and  a  Chemical  Abstracts 
Service  (CAS)  registry  number  527-07-1,  currently  falling  within  CN  code  ex  2918  16  00 
(TARIC code 2918 16 00 10) and originating in the People's Republic of China. 

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

Company 

Anti-Dumping duty 
rate (%) 

TARIC additional codes 

Shandong Kaison Biochemical Co., Ltd, 
Wulian County, Rizhao City  

Qingdao Kehai Biochemistry Co. Ltd, 
Jiaonan City 

5.6 

27.1 

A972 

A973 

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All other companies 

53.2 

A999 

3.  The  application  of  the  individual  duty  rates  specified  for  the  companies  mentioned  in 
paragraph 2 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 the 
Annex. If no such invoice is presented, the duty rate applicable to all other companies shall 
apply.  

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

Article 2 

The  amounts  secured  by  way  of  provisional  anti-dumping  duties  pursuant  to  Commission 
Regulation (EU) No 377/2010 on imports of dry sodium gluconate with a Customs Union and 
Statistics (CUS) number 0023277-9 and a Chemical Abstracts Service (CAS) registry number 
527-07-1, currently falling within CN code ex 2918 16 00 (TARIC code 2918 16 00 10), and 
originating  in  the  People's  Republic  of  China  shall  be  definitely  collected  at  the  rate  of  the 
definitive duty imposed pursuant to Article 1. The amounts secured in excess of the rate of the 
definitive anti-dumping duty shall be released.  

Article 3 

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

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

Done at Brussels, […] 

For the Council 

[…] 

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ANNEX  

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(3): 

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

2.  The  following  declaration:  "I,  the  undersigned,  certify  that  the  (volume)  of  dry  sodium 
gluconate sold for export to the European Union covered by this invoice was manufactured by 
(company name and address) (TARIC additional code) in (country concerned). I declare that 
the information provided in this invoice is complete and correct. 

Date and signature 

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