Case C-269/23 P: Appeal brought on 25 April 2023 by Hengshi Egypt Fiberglass Fabrics SAE and Jushi Egypt for Fiberglass Industry SAE against the judgment of the General Court (First Chamber, Extended Composition) delivered on 1 March 2023 in Case T-480/20, Hengshi Egypt Fiberglass Fabrics and Jushi Egypt for Fiberglass Industry v Commission
Date: 2023-04-25
Institutions: Court of Justice
Subjects: China, Egypt, countervailing charge, customs drawback, financial aid, glass fibre, import (EU), originating product, textile product, turnover








C_2023216EN.01003301.xml










19.6.2023   


EN


Official Journal of the European Union


C 216/33






Appeal brought on 25 April 2023 by Hengshi Egypt Fiberglass Fabrics SAE and Jushi Egypt for Fiberglass Industry SAE against the judgment of the General Court (First Chamber, Extended Composition) delivered on 1 March 2023 in Case T-480/20, Hengshi Egypt Fiberglass Fabrics and Jushi Egypt for Fiberglass Industry v Commission

(Case C-269/23 P)
(2023/C 216/43)
Language of the case: English

Parties


Appellants: Hengshi Egypt Fiberglass Fabrics SAE and Jushi Egypt for Fiberglass Industry SAE (represented by: B. Servais and V. Crochet, avocats)

Other parties to the proceedings: European Commission and Tech-Fab Europe eV

Form of order sought

The appellants claim that the Court should:






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annul the judgment under appeal,










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accept the first part of the first plea in law and the second, fourth and fifth pleas in law of the action for annulment brought by Hengshi Egypt Fiberglass Fabrics S.A.E. and Jushi Egypt for Fiberglass Industry S.A.E, and










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order the Appellee and any intervening party to pay the costs including those incurred at first instance.





Pleas in law and main arguments

In the judgment under appeal, the General Court dismissed the action for annulment brought by the appellants against Commission Implementing Regulation (EU) 2020/776 (1) of 12 June 2020 imposing definitive countervailing duties on imports of certain woven and/or stitched glass fibre fabrics originating in the People’s Republic of China and Egypt and amending Commission Implementing Regulation (EU) 2020/492 imposing definitive anti-dumping duties on imports of certain woven and/or stitched glass fibre fabrics originating in the People’s Republic of China and Egypt.
In support of the present appeal, the Appellants rely on five grounds of appeal, namely that the General Court erred in law when it:






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determined that the Commission did not infringe Articles 1(1), 5 and 6 of the Basic Regulation when adopting its method for calculating the Appellants’ subsidy margin;










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concluded that the Commission did not infringe Articles 2(a), 2(b) and 3(1)(a) of the Basic Regulation when it attributed financial contributions by governments and public bodies linked to the Government of the People’s Republic of China to the government of the country of origin or export, namely the Government of the Arab Republic of Egypt;










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found that the Commission did not violate Articles 4(2) and 4(3) of the Basic Regulation when it concluded that the Government of Egypt has the status of authority which granted the preferential financing that was granted by the Government of China;










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concluded that the Commission did not violate Articles 3(1)(a)(ii), 3(2) and 5 of the Basic Regulation when calculating the amount of the benefit conferred to Jushi under the duty drawback scheme; and










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deemed that the Commission did not violate Articles 3(2) and 4(2)(c) of the Basic Regulation when determining that the tax treatment of foreign exchange losses conferred a benefit to the Appellants and constituted a specific subsidy.




With regard to the first ground of appeal, the Appellants in essence submit that the General Court erred in law when it considered that the Commission’s use of the Appellants’ combined total turnover from all products as an appropriate denominator for the calculation of the benefit in percentage (that is the amount of countervailable subsidy) was not vitiated by a manifest error of assessment.
With regard to the second ground of appeal, the Appellants in essence submit that the General Court erred in law when it concluded that the Basic Regulation does not rule out the possibility that, even if the financial contribution does not come directly from the government of the country of origin or export, that financial contribution may be attributed to it, under Articles 2(b) and 3(1) of the Basic Regulation.
With regard to the third ground of appeal, the Appellants in essence submit that the General Court erred in law when it concluded that the Government of Egypt has the status of authority which granted the preferential financing that was granted by the Government of China. Instead, the General Court should have concluded that the Commission violated Articles 4(2) and (3) of the Basic Regulation because it was the Chinese entities providing the financial contributions that were the granting authority.
With regard to the fourth ground of appeal, the Appellants in essence submit that the General Court erred in law when it concluded that the only comparable situation for the purpose of determining whether Jushi received a benefit is that of an undertaking established, like Jushi, in the Suez Canal Economic Zone (SCZone) which sells products containing materials that have benefited from exemption from customs duties to an undertaking established outside the SCZone.
With regard to the fifth ground of appeal, the Appellants in essence submit that the General Court erred in law when it concluded that the Commission did not consider that the tax treatment in itself constituted a subsidy capable of being the subject of a countervailing measure and that the Applicants at first instance failed to adduce evidence that might render implausible the factual assessments made by the Commission in the contested implementing regulation regarding the fact that the tax treatment benefited all undertakings with liabilities in foreign currencies.


(1)  OJ 2020, L 189, p. 1.