Proposal for a COUNCIL IMPLEMENTING REGULATION amending Implementing Regulation (EU) No 857/2010 imposing a definitive countervailing duty and collecting definitively the provisional duty imposed on imports of certain polyethylene terephthalate originating, inter alia, in Pakistan
Date: 2013-08-23
Institutions: European Commission
Subjects: Pakistan, anti-dumping duty, anti-subsidy proceeding, import (EU), originating product, plastics, principle of proportionality













EUR-Lex - 52013PC0604 - EN











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52013PC0604

Proposal for a COUNCIL IMPLEMENTING REGULATION amending Implementing Regulation (EU) No 857/2010 imposing a definitive countervailing duty and collecting definitively the provisional duty imposed on imports of certain polyethylene terephthalate originating, inter alia, in Pakistan /* COM/2013/0604 final - 2013/0293 (NLE) */









EXPLANATORY MEMORANDUM
1.           CONTEXT OF THE PROPOSAL
•           Grounds for and objectives of
the proposal
This proposal concerns the application of
Council Regulation (EC) 597/2009 of 11 June 2009 on protection against subsidised
imports from countries not members of the European Community, ('the basic
Regulation') in the partial reopening of the anti-subsidy proceeding concerning
imports of certain polyethylene terephthalate originating, inter alia, in
Pakistan.
•           General context
This proposal is made in the context of the
implementation of a judgment of the General Court on the implementation of Council
Regulation (EC) No 597/2009 of 11 June 2009 on protection against subsidised
imports from countries not members of the European Community[1] ("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 Implementing Regulation (EU) No 857/2010
of 27 September 2010[2].
•           Consistency with other policies
and objectives of the Union
Not applicable.
2.           RESULTS OF CONSULTATIONS WITH THE
INTERESTED PARTIES AND IMPACT ASSESSMENTS
            •           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 provide for 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 May 2013, the Commission announced by
a notice (‘notice of partial reopening’), published in the Official Journal of
the European Union[3],
the partial reopening of the anti-subsidy investigation concerning imports of
certain polyethylene terephthalate originating, inter alia, in Pakistan.
This reopening was triggered by the partial
annulment by the General Court of Article 1 of the Council Implementing
Regulation No 857/2010 in so far as it concerns the Pakistani exporting
producer Novatex Ltd ('Novatex' or 'the company concerned'). In line with
Article 266 of Treaty on the Functioning of the European Union, the
institutions of the European Union are obliged to comply with the judgment of
the General Court. Consequently, the European Commission initiated the partial
reopening of the anti-subsidy investigation in so far as it concerns Novatex. 
The enclosed Commission proposal for a
Council Regulation imposing an amended definitive countervailing duty on Novatex
is made upon the interested parties having been given sufficient time to
provide comments to the revised final disclosure document of 25 June 2013. 
It is proposed that the Council adopt the
attached proposal for a Regulation which should be published in the Official
Journal of the European Union as soon as possible.
•           Legal basis
Council Regulation (EC) 597/2009 on
protection against subsidised 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 instruments: Council Regulation.
Other means would not be adequate because
the basic Regulation does not provide for alternative options.
4. Budgetary
implication
The proposal has no implication for the Union
budget. 
2013/0293 (NLE)
Proposal for a
COUNCIL IMPLEMENTING REGULATION 
amending Implementing Regulation (EU) No
857/2010 imposing a definitive countervailing duty and collecting definitively
the provisional duty imposed on imports of certain polyethylene terephthalate
originating, inter alia, in Pakistan 
THE COUNCIL OF THE EUROPEAN UNION,
Having regard to the Treaty on the
Functioning of the European Union, 
Having regard to Council Regulation (EC) 597/2009
of 11 June 2009 on protection against subsidised imports from countries not
members of the European Community[4]
('the basic Regulation'), and in particular Article 15(1) thereof,
Having regard to the proposal from the
European Commission ('the Commission') after consulting the Advisory Committee,
Whereas:
A. PROCEDURE
(1)       By Council Implementing Regulation
(EU) No 857/2010[5]
('the contested Regulation'), the Council imposed definitive anti-subsidy duties
ranging from 44,02 euro per tonne to 139,70 euro per tonne eon imports of certain
polyethylene terephthalate having a viscosity number of 78 ml/g or higher,
according to ISO Standard 1628-5, originating in Iran, Pakistan and the United
Arab Emirates.
(2)       On 6 December 2010, the
co-operating exporting producer in Pakistan, namely Novatex Ltd ('Novatex' or
'the company concerned'), lodged an application at the General Court seeking
the annulment of the contested Regulation in so far as it applied to the
applicant[6].

(3)       On 11 October 2012, the
General Court in its judgment in case T-556/10 ('the General Court judgment')
found that the failure of the Commission and the Council to take account of the
figure resulting from the revision of line 74 of the 2008 tax return and the
error resulting therefrom affect the legality of Article 1 of the contested Regulation
in so far as the definitive countervailing duty fixed by the Council exceeded
the duty applicable in the absence of that error. Therefore, the General Court
annulled Article 1 of the contested Regulation in so far as it concerned Novatex
and in so far as the definitive countervailing duty exceeded that applicable in
the absence of the error. 
(4)       The General Court in case
T-2/95[7]
(the 'IPS case') has recognised that, in cases where a
proceeding consists of several administrative steps, the annulment of one of
those steps does not annul the complete proceeding. This anti-subsidy
proceeding is an example of such a multi-step proceeding. Consequently, the
annulment of part of the contested anti-subsidy Regulation does not imply the
annulment of the entire procedure prior to the adoption of that Regulation.
Moreover, according to Article 266 of the Treaty on the Functioning of the
European Union ('TFEU'), the
Union institutions are obliged to comply with the General Court judgment of 11
October 2012. This also implies the possibility to remedy the aspects of the
contested Regulation which led to its partial annulment, while leaving
unchanged the uncontested parts which are not affected by the General Court
judgment[8].
It should be noted that all other findings made in the contested Regulation
remain valid.
(5)       Following
the General Court judgment of 11 October 2012, the Commission partially
reopened, on 17 May 2013, the anti-subsidy investigation concerning imports of certain polyethylene terephthalate originating, inter alia, in Pakistan[9]. The reopening was limited in scope to the implementation of the General
Court judgment in so far as Novatex is concerned. 
(6)       The
Commission officially advised the exporting producers, importers, users and raw
material suppliers known to be concerned, the representatives of the exporting
country and the Union industry of the partial reopening of the investigation.
Interested parties were given the opportunity to make their views known in
writing and to request a hearing within the time-limit set out in the notice.
None of the interested parties requested to be heard.
(7)       All parties concerned were
informed of the essential facts and considerations on the basis of which it was
intended to recommend the imposition of an amended definitive countervailing
duty on Novatex. They were granted a period within which to make
representations subsequent to disclosure. 
B.        IMPLEMENTATION OF THE GENERAL
COURT JUDGMENT
1.           Preliminary
remark
(8)       It
is recalled that the reason for the partial annulment of the contested
Regulation was that the Commission and the Council should have taken account of
the fact that line 74 of the 2008 tax return of the company concerned had been
revised. 
2.           Comments of interested
parties
(9)       Within the applicable
deadline for submitting comments the company concerned, Novatex, commented that
following the judgment of 11 October 2012, the definitive countervailing duty
for imports into the European Union of certain polyethylene terephthalate
originating in Pakistan should be reduced by 1.02%. Novatex further stated that
the countervailing duty applicable to Novatex should be set at 4.1% or EUR 35,39
per tonne as from 1 June 2010 (the alleged date of entry into force of the
provisional duty).
(10)     No further comments of any
substance on the partial re-opening were received.
3.           Analysis of comments 
(11)     Having analysed the above
comments, it is confirmed that the annulment of Implementing Regulation (EU) No
857/2010 with regard to Novatex, insofar as the definitive countervailing duty
exceeded the duty applicable in the absence of the error identified by the
Court, should not imply the annulment of the entire procedure prior to the
adoption of the Regulation. 
(12)     The recalculation of
Novatex’ subsidy duty rate, taking account of the modified line 74 of the
company’s tax return, indeed results in a corrected amount of EUR 35,39 per
tonne.
(13)     The revised duty rate
should indeed be applied retroactively, i.e. from the date of entry into force
of Implementing Regulation (EU) No 857/2010. By virtue of Article 2 of that
regulation, it will also apply from the entry into force of Commission
Regulation (EU) No 473/2010 imposing a provisional countervailing duty. That
Commission Regulation entered into force the day following its publication in
the Official Journal of the European Union, i.e. on 2 June 2010 (and not on 1
June 2010 as stated by Novatex). 
4.           Conclusion
(14)     Account taken of the
comments made and the analysis thereof it is therefore concluded that the
implementation of the General Court judgment should take the form of a revision
of the countervailing duty duty rate applicable to Novatex, which should be
reduced from 44.02 euro/tonne to 35.39 euro/tonne. As Novatex was the sole
exporting producer of the product concerned in Pakistan during the investigation
period, this revised duty rate applies to all imports from Pakistan. The revised duty rate should be applied retroactively, i.e. as from the date of
entering into force of Implementing Regulation (EU) No 857/2010. By virtue of
Article 2 of that Regulation, it should also apply from the entry into force of
Commission Regulation (EU) No 473/2010 imposing a provisional countervailing
duty.. 
(15)     Customs authorities should
be instructed to proceed with the reimbursement of the amount of duties paid in
excess of the amount of 35,39 euro/tonne for the imports concerned in
compliance with the applicable customs legislation. 
C.        DISCLOSURE
(16)     Interested parties were
informed of the essential facts and considerations on the basis of which it was
intended to implement the General Court judgment. All interested parties were
given an opportunity to comment, applying the 10-day period prescribed in
Article 30(5) of the basic Regulation. 
(17)     No substantial comments
were received.
D.        AMENDMENT OF THE MEASURES
(18)     In the light of the results
of the partial reopening, it is considered appropriate to amend the
countervailing duty applicable to imports of the product concerned originating
in Pakistan to 35,39 euro/tonne. 
(19)     This procedure does not affect
the date on which the measures imposed by the contested Regulation will expire,
which is 30 September 2015,    
HAS ADOPTED THIS REGULATION:
Article 1
1.           The
Table in Article 1(2) of Council Implementing Regulation No 857/2010 shall be
amended to read as follows:
 Country || Definitive countervailing duty rate (EUR/tonne) 
 Iran: all companies || 139,70 
 Pakistan: all companies || 35,39 
 United Arab Emirates: all companies || 42,34 
2.           The
revised duty rate of 35,39 EUR/tonne for Pakistan shall be applicable as from 30
September 2010. 
3.           The
amounts of duties paid or entered into the accounts pursuant to Article 1 of Implementing Regulation (EU) No 857/2010 in
its initial version and the amounts of provisional duties definitively
collected pursuant to Article 2 of the same Regulation in its initial version, which
exceed those as established on the basis of Article 1 of this Regulation, shall
be repaid or remitted. Repayment and remission shall be requested from national
customs authorities in accordance with applicable customs legislation.Unless
otherwise specified, the provisions in force concerning customs duties
shall apply.
Article 2
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
                                                                       The
President
[1]               OJ L 188, 18.7.2009, p. 10
[2]               OJ L 254, 29.9.2010, p. 10.
[3]               OJ C 138, 17.5.2013, p. 32–34.
[4]               OJ L 188, 18.07.2009, p.104-105.
[5]               OJ L 254, 29.9.2010, p. 10.
[6]               Case T-556/10 Novatex Ltd v Council of the European
Union.
[7]               Case
T-2/95 Industrie des poudres sphériques (IPS) v Council [1998] ECR II-3939.
[8]               Case T-2/95 Industrie des poudres sphériques
(IPS) v Council [1998] ECR II-3939.
[9]               OJ C 138, 17.5.2013, p. 32–34.