CELEX: 51987PC0098
Language: en
Date: 1987-03-03
Title: Proposal for a COUNCIL REGULATION (EEC) imposing a definitive anti-dumping duty on imports of standardized multi -phase electric motors having an output of more than 0.75 kW but not more than 75 kW, originating in Bulgaria, Czechoslovakia, the German Democratic Republic, Hungary, Poland, or the Soviet Union, and definitively collecting the amounts secured as provisional duties (presented by the Commission)

ARCHIVES HISTORIQUES
DE LA COMMISSION
COLLECTION RELIEE DES
DOCUMENTS "COM"
COM (87) 98
Vol. 1987/0041
 ---pagebreak--- Disclaimer
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 ---pagebreak--- COMMISSION OF THE EUROPEAN COMMUNITIES
                                                         COM(87 ) 98 final
                                                         Brussels , 3 March 1987
                                   Proposal for a
                              COUNCIL REGULATION ( EEC )
    imposing a definitive anti-dumping duty on imports of standardized
           multi -phase electric motors having an output of more than
           0.75 kW but not more than 75 kW , originating in Bulgaria ,
            Czechoslovakia , the German Democratic Republic , Hungary ,
           Poland , or the Soviet Union , and definitively collecting
                     the amounts secured as provisional duties
                           (presented by the Commission )
C0M(87
COM ( 87 ) 98 final
                           foj
                                             KSJ
                            vît 0 ^ ';
                                       j v'J
 ---pagebreak---                             EXPLANATORY MEMORANDUM
                                                  1
1.   Commission Regulation ( EEC ) No 3019 / 86 ,   in connection with the review
proceeding opened on 26 November 1985 , imposed a provisional anti -dumping
duty on imports of standardized multi-phase electric motors having an
output of more than 0.75 kW but not more than 75 kW, originating in Bulgaria ,
Czechoslovakia , the German Democratic Republic , Hungary , Poland , Romania or
                                                    2
the USSR . Council Regulation ( EEC ) No 254/ 87 extended that provisional duty
until 31 March 1987 .
2 . Since the provisional measures were imposed , the Commission has extended
its investigation into normal value and injury . The interested parties have
been informed of the definitive results .
It must be stressed that each exporter has now had three hearings and has
been given the results of the investigation three times .
3 . Most of the exporters - and in particular those from the USSR , the
German Democratic Republic and Poland - contested the choice of Sweden as
representative market-economy country for the establishment of normal
value .
1 0J L 280, 1.10.1986, p . 68 .
20J L 26, 29.1.1987.
 ---pagebreak---                                        - 2 -
In November the Commission received a further complaint concerning the
same products originating in Yugoslavia , and consequently investigated that
country 's domestic prices . The definitive determination of normal value was
therefore based on Yugoslavia , which was considered a more appropriate basis
for comparison and this choice was not , on the whole , much disputed .
However , the Soviet exporter argued that if normal value was determined in
Yugoslavia it should be determined on the basis of a constructed value
( costs of production + overheads + reasonable profit margin ), and not on
that of domestic prices .
As an alternative the Soviet exporter claimed various allowances to take
account of differences in purchasing power between the USSR and Yugoslavia
and to reflect differences in wage levels , component costs and economies of
scale .
The Soviet exporter did not , however , supply any evidence to support its
requests , and the allowances claimed are not among those provided for in
Regulation ( EEC ) No 2176 / 84 .
The only alternative reference countries proposed by the exporters were two
of the very Community Member States ( France and Italy ) whose markets are
most depressed by the dumping concerned .
The definitive dumping margins calculated by reference to Yugoslav domestic
prices varied between 160% and 117% .
 ---pagebreak---                                         - 3 -
4 . Most of the exporters and some importers disputed the preliminary
conclusions concerning injury , claiming basically that :
- it was inappropriate to assess the cumulative effect of all imports
   covered by the investigation ;
- export prices were simply aligned on the prices charged by Community
   producers ;
- the Community producers were waging a price war .
As regards cumulation , it has always been Community practice to assess the
cumulative effect of the imports concerned where the products are
interchangeable (" fungible ") and import prices similar . Both conditions
are fulfilled in this case .
After imposing the provisional duty the Commission extended its investigation
into the questions of " alignment of prices " and the " price war ".
That investigation revealed more or less systematic and substantial price
undercutting - typically between 5% and 45% - on all of the markets under
attack ( D , F , I , BLEU ). Price undercutting was obviously lower -
typically between 2% and 22% - on the Italian market , where costs of
production are lowest .
Almost all producers are making losses in the standardized electric motors
sector , which they cover from profits made in other sectors , in particular
the motors for special purposes sector , where the state-trading countries'
exports are negligible .
 ---pagebreak---                                        - 4 -
Another characteristic indication of causality is that the United Kingdom
market - where there are hardly any imports originating in Eastern European
countries - has a substantially higher profit level , indeed the main
producer makes substantial profits in this sector .
Thus the evidence submitted by all the exporters and various importers was
not such as to lead the Commission to amend its conclusions concerning the
existence of material injury caused by the imports in question .
5 . Certain exporters claimed that a definitive price increase equivalent
to the provisional duty ( about 35% for the most common types of 4-pole
motors ) would have an adverse effect on their trade relations with
Community countries , in particular as regards compensation transactions .
Whatever the real or potential impact of anti-dumping measures , however ,
the Commission considers that the material injury suffered by Community
manufacturers in the production of " standardized motors " and the fact that
such motors play a central role in the overall rotary machine sector compel
the Community , in its own interests , to adopt the requisite measures .
Should the measures taken prove inadequate there is a danger that over the
coming years the state-trading countries will gradually displace Community
producers from the standardized motors market .
Indeed , the investigation revealed a marked trend towards Community
importers setting up facilities for assembling standardized electric motors
from components imported from the state-trading countries .
6.  The Commission received no acceptable price undertakings , with the
exception of that offered by the Romanian exporter , whose market share has
 ---pagebreak--- fallen to a negligible level , and which does not appear to be associated
with an importer .
Certain other exporters suggested offering price undertakings , but the
Commission judged their offers inacceptable and informed them of its reasons
for so deciding .
7 . The Commission therefore proposes that the Council impose a definitive
anti-dumping duty comparable to the provisional duty ( minimum price ).
However , because of the fierce nature of intra-Community competition and the
relatively wide range of production costs among Community producers , the
Commission proposes that the Council raise the prices on the basis of the
production costs of the most efficient Community producers . The increase
for 4-pole motors comes to some 25% of the f ree-at - Community-f rontier price ,
not cleared through customs . The rate of such definitive duty , which is
much lower than the dumping margins established , should be sufficient to
remove the injury caused to the Community standardized multi-phase electric
motors industry by imports originating in the state-trading countries
concerned .
8 . At the same time , the Commission proposes that the Council definitively
collect the provisional anti-dumping duty according to the final scale of
minimum prices .
9 . The Anti-dumping Committee was consulted concerning the results of
this review proceeding and expressed a favourable opinion .
 ---pagebreak---                         Proposai for
               Council Regulation ( EEC )
imposing a definitive anti-dumping duty on imports of standardized
multi-phase electric motors having an output of more than 0.75 kW
but not more than 75 kW, originating in Bulgaria , Czechoslovakia ,
the German Democratic Republic , Hungary , Poland, or the Soviet Union ,
and definitively collecting the amounts secured as provisional duties
THE COUNCIL OF THE EUROPEAN COMMUNITIES ,
Having regard to the Treaty establishing the European Economic Community ,
Having regard to Council Regulation ( EEC ) No 2176 / 84 of 23 July 1984
on protection against dumped or subsidized imports from countries not
                                             1
members of the European Economic Community , and in particular
Article 12 thereof ,
Having regard to the proposal from the Commission , presented after
consultations within the Advisory Committee established by the said
Regulation ,
Whereas :
1 0J No L 201 , 30.7.1984, p. 1 .
 ---pagebreak---                                     - 2 -
A.    Provisional measures
 1 . Commission Regulation ( EEC ) No 3019/86,^ in connection with the
 review proceeding opened on 26 November 1985,^ imposed a provisional
anti-dumping duty on imports of standardized multi-phase electric
motors having an ouput of more than 0.75 kW but not more than 75 kW ,
originating in Bulgaria , Czechoslovakia , the German Democratic
Republic , Hungary , Poland , Romania or the USSR .
That Regulation also withdrew the Commission 's acceptance of the price
undertakings previously given by the exporters from Hungary and the
USSR .
On the same day Council Regulation ( EEC ) No 3018 / 86 withdrew
acceptance of the price undertakings previously given by the exporters
from Bulgaria , Czechoslovakia , the German Democratic Republic , Poland
and Romania .
                                                          4
Council Regulation ( EEC ) No 254 / 87 of 29 January 1987   extended the provisional
duty for a period of two months .
B. Further proceedings
2 . Shortly after the provisional duties were imposed , the complainants -
GIMELEC , supported by ZVEI , REMA, FABRIMETAL and ANIE - asked the
Commission to extend the proceeding to imports of the product in
question originating in Yugoslavia .
*0J No L 280, 1.10.1986, p . 68 .
■fOJ No C 305 , 26.11.1985, p . 2 .
   0J No L 26, 29.1.1987 .
 ---pagebreak---                                - 3 -
The Commission decided after consultations that the evidence presented
was sufficient to justify the opening of an anti-dumping proceeding
concerning the imports in question originating in Yugoslavia , and
began its investigation on 8 November 1986.^
Although the anti-dumping proceeding concerning imports originating
in Yugoslavia is distinct from the present review proceeding, it
nevertheless concerns the same products .   In order to establish its
definitive conclusions vis-a-vis the State-trading countries concerned ,
the Commission therefore also examined the level of domestic prices
in Yugoslavia , the number of the motors in question exported by
Yugoslav producers to the Community and the price levels involved .
3 . After the imposition of the provisional duties , and within the
period provided for by Regulation ( EEC ) No 3019 / 86, the exporters
from the state-trading countries against which the provisional duties
had been imposed , and certain importers ( Symkens , Liege ; Sermes ,
Strasbourg ; Stanko, . ; Neotype , . ) requested a hearing
from the Commission .   The latter informed them in detail of the
facts and considerations on which its provisional conclusions had
been based , and on the basis of which it intended to propose the
imposition of a definitive duty and the collection of the amounts
secured by way of the provisional anti-dumping duty .
All parties were given the opportunity to make known their point of
view on these conclusions within a prescribed period . Some of them
took advantage of this opportunity , and their observations were taken
into account .
5
  0J No C 282 , 8.11.1986, p 3 .
 ---pagebreak---                               - 4 -
4.  In order to establish definitively the normal value in the
state-trading countries under consideration , the Commission made
additional enquiries of the main Swedish producer , whose domestic
prices had been used for the preliminary determination of the normal
value .
As a parallel anti-dumping proceeding had been opened concerning imports
of motors originating in Yugoslavia - see point 2 - the Commission also
made enquiries of the following three Yugoslav producers / exporters ,
of standardized electric motors :
                   t -                 '
                            i
- Rade-Koncar , Zagreb
- Sever , Subotica
- Elektrokovina , Maribor .
In order to investigate the questions of injury and causality in more
detail , the Commission also made additional enquiries of the Community
producers listed in Regulation ( EEC ) No 3019 / 86, and included in the
investigation two Italian producers whose names had been suggested
by several importers :
- Electro-Ada , . .
- Lafert , .
C.  Normal value
5 . In order to establish whether products originating in Bulgaria ,
Czechoslovakia , the German Democratic Republic , Hungary , Poland ,
Romania or the USSR were still being imported at dumped prices , and
in view of the fact that those countries do not have a market economy ,
the Commission made a preliminary determination of the normal value
of domestic prices in those countries on the basis of the prices on
the Swedish domestic market of products manufactured by ASEA , the
main Swedish manufacturer .
 ---pagebreak---                                     - 5 -
The Commission considered that the prices on the Swedish domestic
market of products manufactured by the largest Swedish manufacturer
constituted an appropriate and not unreasonable basis for comparison
within the meaning of Article 2(5 ) of Regulation ( EEC ) No 2176 / 84 .
This choice was not disputed by any of the exporters in question
within the prescribed period of the preliminary phase of the
investigation . Only a small number of importers disputed the choice
within the prescribed period , proposing that France or Italy should be
chosen as market-economy reference country and that normal value there
should be determined on the basis of market prices ( Article 2(5 ) ( c )).
The Commission rejected this proposal , since Article 2(5 ) ( c ) is to
be applied only when neither price nor constructed value as established
under Article 2(5 ) ( a ) or ( b ) provides an adequate basis , which is not
the case here , given the characteristics of the Swedish market . In
addition , one of the exporters , ZSE, had specifically accepted that
the normal value should be established on the basis of Swedish
domestic prices .
6 . After the provisional duty had been imposed , several of the
exporters concerned - in particular those from the German Democratic
Republic , Poland and the Soviet Union - disputed , in varying degrees ,
( i ) the choice of Sweden as the reference market , ( ii ) the choice of
ASEA as representative producer , and ( iii ) the level of the ASEA
prices considered , in other words the level of discounts considered .
Some exporters , while disputing the choice of Sweden as reference
market , proposed that the normal value should be established on the
basis of ASEA 's production costs .
In substance , the exporters' arguments against the normal value
 ---pagebreak--- established by Commission Regulation ( EEC ) No 3019 / 86 concern the
size of the Swedish market ( which they think is too small ), the
competitive position of ASEA in Sweden (a dominant position ,
according to some ) and finally the discounts granted by ASEA and
taken into account by the Commission ( 60% , whereas the exporters'
view is that the normal discount on the Swedish market in 1985 was
80% ) .
- Regarding the controversy over the level of discounts granted by
  ASEA in Sweden , after the imposition of the provisional duty
  the Commission carried out an additional , exhaustive check of all
  sales of standardized motors during a test period chosen at random
  ( end of May - end of June ).  This check showed a discount level
  ( 63% ) only slightly different from the rate originally allowed for
  ( 60% ).    It must be noted here that , as for all Community - and
  Yuglav - producers , the discounts granted by ASEA are only in
  exceptional cases price discounts for quantity sales in the strict
  sense ; they are in fact calculated on the basis of the commercial
  importance of each customer to the producer in question , from the
  point of view of total annual sales volume for all rotary machines ,
  or even all products taken together . There are therefore no price
  discounts for quantity sales specific to standardized electric
  motors .
- Regarding ASEA 's competitive position on the Swedish home market ,
  the Commission is entirely unable to give a pertinent judgment .
  It is clear , however , that the Swedish market includes a second
  producer , ELMO - which according to some sources now assmbles parts
  imported from state-trading countries - and also takes imports
  ( approximately 36% of the market ) originating in state-trading
  countries or in Community Member States .
 ---pagebreak---                                   - 7 -
- Lastly it was argued that the size of the Swedish market
( 160 000 motors ) was too far removed from the size of the domestic
markets of the relevant state-trading countries ( several million
motors , according to the exporters ). In the exporters' view
this would imply either abandoning the use of Sweden as reference
country , adjusting Swedish domestic sale prices or establishing a
constructed normal value on the basis of ASEA 's production costs .
7 . The Commission 's view is that the concept of " economies of scale "
is specific to market economies , and that there is no reason to
consider it valid in countries where trade is a monopoly or
near-monopoly , and where all domestic prices are fixed by the State .
So , taken to their logical conclusions , the arguments used by some
exporters would , for example , confine the choice of reference country
for establishing normal value for the Soviet Union to the United
States , because of the respective size of the two markets .
Similarly , in establishing normal value on the basis of a non-member
country with a market economy there is no reason to make adjustments
which are supposed to represent differences in costs in state-trading
countries . Any adjustment of the normal value established in the
reference country would imply an overall evaluation , not limited to
any one given stage in the production process , of the comparative
advantages of the reference country and the state-trading countries ;
secondly , even if such an evaluation were feasible, it would not of
itself give any indication on the question of taking it into account
in the normal value of the reference country , because in a market
economy prices are a function not only of costs but also of the balance
between supply and demand .
 ---pagebreak---                             - 8 -
8.  For all the reasons indicated at point 7, the Commission
considered that the prices on the Swedish domestic market of
products manufactured by the largest Swedish manufacturer constituted
an appropriate and not unreasonable basis for comparison . As indicated
at point 4, however , since the provisional duties were imposed the
Commission has also been able to carry out in due time checks on
three Yugoslav producers / exporters of standardized electric motors .
As Yugoslavia is a market-economy country , the question arose as to
whether prices on the Yugoslav domestic market would not also constitute
a not unreasonable , and even more appropriate , basis for comparison .
All of the exporters , except *** considered this to be indeed the case .
In particular it emerged that the Yugoslav standardized motor market
was for about 250 000 motors and was , according to the domestic
producers , very competitive ; it further emerged that , in common with
the economies of the state-trading countries , the Yugoslav economy
had a chronic lack of foreign exchange .
The exporters and other interested parties were therefore informed
of the Commission 's intention of choosing the weighted average of the
Yugoslav producers' domestic selling prices as the basis for comparison
in definitively establishing the normal value .
This choice was disputed by one exporter only .   The exporter from the
Soviet Union asked for a constructed normal value to be established
on the basis of the Yugoslav producers' production costs .   This was
rejected for the reasons set out at point 7 .
 ---pagebreak---                                       - 9 -
The Commission therefore considered , and the Council shares this opinion ,
that the weighted average of Yugoslav producers' domestic selling prices
constituted a basis for comparison which was not unreasonable and was
the most appropriate basis for the definitive establishment of the
normal value of domestic prices in the state-trading countries in
question .
On this basis , the normal values for the six types of motor in the
sample chosen (1 500 rpm four-pole motors of the following capacities :
1.1 kW , 3 kW, 5.5 kW , 11 kW , 30 kW and 75 kW , enclosed , blowei–cooled ,
type B3 motors with retaining legs , IP 44 / 54 , 220 / 380 V , 50 Hz ) were
established as follows , taking account of the appropriate allowances
explained at point 10 .
   Normal value                 ECU ( 1985 )        ( ex-works , cash payment )
   kW
   1.1                          69.13
   3                           146.38
   5.5                         216.55
  11                           325.80
  30                           802.38
  75                        1 938.11
 ---pagebreak---                                      - 10 -
D.   Compar ison
9 . The definitive determination of dumping was made by comparing ,
at the ex-works stage , the normal values established above with the
prices for exports to the Community from the seven state-trading
countries concerned during the reference period . The export prices
selected were the prices actually paid or payable on export to each of
the main Community markets .
10 .  In order to compare the normal value with the ex-works export
prices of each of the products contained in the sample , the Commission
took account of differences affecting the comparability of Yugoslav
domestic prices and the prices of motors exported by the state-trading
countries , and appropriate allowances were made where the interested
parties proved that such a request was justified .
11 . The domestic prices of the Yugoslav motors were calculated at the
ex-works stage , in terms of cash payment . In this respect , allowances
were made to take account of the sales conditions ( payment and credit
terms , warranties , servicing , salaries paid to salesmen , packing , transport ,
insurance , handling , loading and ancillary costs in particular ) in so far
as those differences had a direct functional relationship to the sales
under consideration and did not cover only differences in overheads and
general expenses .
Allowances were made for price discounts on quantity sales , and the net
sales prices of the Yugoslav producers were calculated on the basis of
a discount of 9% on the list prices , corresponding to the maximum discount
granted by these producers to their largest customers .
 ---pagebreak---                                      - 11
- In addition to the above allowances , the Yugoslav producers / exporters
   requested two further allowances in respect of their domestic prices ,
   both of which were rejected .
   The first request concerned an allowance to take account of the fact
   that the official exchange rate of the Yugoslav currency , the dinar ,
   did not correspond with its real market value . The Commission established
   that companies operating in Yugoslavia used the official exchange rate
   for the conversion of both import and export transactions carried out
   in foreign currencies , and it therefore used the official dinar exchange
   rate in this proceeding .
   The second request concerned an allowance to take account of inflation
   between the date of sale and the date of payment , which was claimed
   to have the effect of reducing the real level of domestic sale prices .
   The Commission pointed out that due allowance had already been made for
   payment conditions and credit terms , which in a market economy are
   influenced by the rate of inflation prevailing in the country concerned .
12 . The export prices of the motors exported by the state-trading countries
were likewise reduced to the cash-payment ex-works price by means of
allowances to take account of payment conditions , credit terms , warranties ,
packing , transport , insurance , handling , loading and ancillary costs .
   / No allowance was requested in respect of the Yugoslav domestic prices
   ( as previously established ) and the export prices of the state-trading
   countries to take account of differences in quantities supplied .
   The Commission established that the maximum discounts given by the
   Yugoslav producers on their domestic market - which , as was pointed
 ---pagebreak---                                     - 12 -
  out at point 6 above , were not strictly speaking quantity discounts
  in any case - generally corresponded with quantities comparable to
  those purchased by importers of motors originating in state-trading
  count ries ._/
  The question arose as to whether there were any differences in the
  physical characteristics of the Yugoslav motors and those from the
  state-trading countries which were such as to affect price comparability .
  The exporter in the German Democratic Republic indicated that for
  motors with equal output its products contained a lower active material
  content than most motors manufactured by competitors in the Community
  and even Yugoslavia . The Soviet exporter and various other exporters
  claimed that the raw materials used in the manufacture of their motors
  were of a lower quality than those used in the market-economy countries .
  Other technical differences were also referred to , concerning in particular
  electricity input , axis height and noise and vibration levels .
  However , the investigation revealed that the use of materials and
  components of different origins and the greater or lesser optimization
  by the various producers of the active material content of their motors
  did not result in differences in physical characteristics / which were
  perceptible to a buyer and such as to influence his choice_/ , nor in
  other differences affecting price comparability for which allowances
  should be made pursuant to Article 2(10 ) of Regulation ( EEC ) No 2176 / 84 .
  / An exception was , however , made in respect of ball bearings , which the
  investigation showed to be one of the factors which influenced the buyer 's
  choice . The Yugoslav motors are fitted with Community , Swedish or
  Japanese ball bearings , whereas the ball bearings fitted in the motors
  from the state-trading countries are widely regarded as being of lower quality .^
^See Commission Decision 86/ 100/ EEC , 0J No L 102, 18.4.1986, p.31 .
 ---pagebreak---                                      - 13 -
         The corresponding allowance was based on the resulting difference in the
         Yugoslav producers' costs of production , given the impossibility of
         quantifying the effect of the difference on the market value of
         the motors concerned on the Yugoslav market,./
13 .     The Soviet exporter requested the following additional allowances :
    (i)    an allowance of 15% to take account of differences between
           Yugoslavia and the Soviet  Union in terms of nationalization
           and economies of scale ;
  ( ii )   an allowance of 20% to take account of differences in wage levels ,
           apparently much higher in Yugoslavia than in the Soviet Union ;
( iii )    an allowance of 30% to take account of differences in physical
           characteristics and in the quality of raw materials , the poor
           brand image of Soviet products among distributors and consumers
           and lower efficiency of the after-sales service compared with
           that provided for Community products ;
  Civ )    an allowance in respect of the costs borne by importers in
           adapting products to comply with EEC technical standards and
           the cost of financing stocks for export borne by both the
           exporter and importers . ENERGOMACHEXPORT put this allowance
           at 35% of the Yugoslav market price .
 ---pagebreak---                                      - 14 -
14 . In addition to the arguments set out at point 7 above , the Council
notes that hardly any of the differences referred to by the Soviet
exporter fall in any of the categories of factors mentioned in
Article 2(9 ) and ( 10 ) of Regulation ( EEC ) No 2176 / 84 .
-   The question of differences in physical characteristics was dealt
    with at point 12 above .
-   If the Commission were to make the allowances requested by the exporter
    for differences in the cost of financing stocks - which it cannot
    since such costs are overheads - the effect would be to increase
    rather than reduce the dumping    margin .
-   The third and fourth requests do not for the main part concern the
    comparison between the Yugoslav normal value and the export price ,
    but rather the question of injury . The Soviet exporter 's arguments
    are therefore dealt with at point 34 below .
As regards ENERGOMACHEXPORT' s first two requests , any allowance made
against the normal value established in a similar country - in this
case Yugoslavia - on the basis of differences in certain production
costs would imply that the costs borne by the Soviet Union , which is
not a market-economy country , were comparable , whereas this is
specifically excluded by Article 2(5 ) of Regulation ( EEC ) No 2176 / 84 .
The arguments put forward by ENERGOMACHEXPORT concerning allowances
to take account of supposed comparative advantages are therefore
rejected .
 ---pagebreak---                                         - 15 -
E.    Dumping margins
15 .   Examination of the facts showed that all the transactions involved
substantial dumping . Dumping margins for each type of motor were
therefore calculated by comparing the average price on export to each
of the Member States of the Community with the normal value as determined
for Yugoslavia .
This calculation showed that the dumping margin varied relatively little
from one type of motor to another but did vary from one exporting country
to another and , above all , from one Community market to another .
16 . For all the motors in the representative sample , the average weighted
dumping margins represented the following percentages of the cif
f ree -at -Community- f rontier price , not cleared through customs :
       ( percentages )                  EEC      D      F      I      BLEU   NL
Bulgaria                                144     126    148    141     n.s . n.s .
Czechoslovakia                          121     129    137    114     124   n.s .
German Democratic Republic              137      -
                                                       135    142     133   124
Hungary                                 146     147    n.s .  158     160    86
Poland                                  139     127    152    143     127   144
Romania                                 134     157    140    126     125   n.s .
USSR                                    131     117    136    142     n.s . n.s .
n.s . = no significant imports
17 . / The above dumping margins are for the motors in the sample ( type
B3 motors ). The investigation carried out with the Yugoslav producers / exporters
 ---pagebreak---                                      - 16 -
showed that other types of motors ( B5 , B14 , etc .) are marketed in
Yugoslavia at a premium of between 5% and 20% . The export prices of
such motors ( B5 , B14, etc .) originating in the Eastern European
countries , on the other hand , are only slightly higher than - or even
the same as - the prices of B3 motors . The above dumping margins are
thus lower than the dumping margins which would have been established
if all types of standardized motor ( B3 , B5 , B14 , etc .) had been
considered ./
18 . P.S. Must the reasoning be given for not reconstructing the
export prices where the dumping margins are already inordinately large ?
F.   Injury
19 .   All the exporters disputed the Commission 's conclusions on the
injury caused by the dumped imports set out in Regulation ( EEC )
No 3019 / 86 .
Various arguments , put forward by the exporters in the German Democratic
Republic , Poland and the Soviet Union in particular , may be summarized
as follows :
20 .   (i)  The exporters first claimed that the Commission had infringed
            Article 14 of Regulation ( EEC ) No 2176 / 84 , which sets out
            the conditions for the re-opening of an anti-dumping proceeding ,
            as the complainants had not submitted evidence of changed
             circumstances sufficient to justify the need for such a
             review .
     ( ii )  The exporters further argued that the impact of their respective
             exports to the Community should be examined separately , and
             that their small shares of the Community market could not
             have cuased injury .
 ---pagebreak---                                           17 -
( iii )    Concerning the volume of Community imports of the standardized
           multi-phase electric motors concerned , the Hungarian exporter
           claimed that , unlike the other exporters in the state-trading
           countries , it mainly exported motors for special uses to the
           Community .
    ( iv )  As regards price-linked factors affecting injury , the exporters
           disputed the method used in Regulation ( EEC ) No 3019 / 86 to
           calculate price undercutting ( comparison of the Community producers'
           production costs and the ex-importer resale price ) and the
           accuracy of the production cost calculations ; they further
           claimed that the price undercutting on the various Community
           markets , i.e. the difference between the Community producers'
           sale prices and the ex-importer resale prices , was far smaller
           than that calculated according to the Commission 's method , and
           in some cases non-existent .
    (v)    The exporters further disputed the degree of injury suffered
           by the Community producers , arguing that Community production
           of standardized motors had increased substantially since 1982 ,
           whereas the overall market share of imports from the state-trading
           countries concerned had fallen from 23.2% in 1982 to 20.3% in
           1985 , while consumption was increasing over that period .
  ( vi )   Lastly , the causal, link with imports from the state-trading
           countries was disputed , it being claimed that :
           -  there had been a substantial increase in imports into the
              Community originating in countries other than those concerned
              by this proceeding ;
 ---pagebreak---                                       - 18 -
- Community producers had not rationalized their production processes
   sufficiently ,, retaining too many factories with capacities too small to
   benefit from economies of scale ;
- intra-Community competition , in particular from certain Italian producers ,
   had also contributed to the difficulties experienced by the Community
   industry .
These arguments are examined one by one below .
21 .   The Commission decided to reopen the anti-dumping proceeding in
November 1985 , when the complainants demonstrated to its satisfaction that
the imports concerned were increasing ( 604 000 units in 1983 , 689 500 units
in 1984 , 748 000 units in 1985 ), that such imports still had a market share
of more than 20% throughout the Community , and considerably more in some
Member States , and that the price undertakings which the Community
institutions had previously accepted had not been passed on to the market
in such a way as to remove the injury suffered by the producers .
An analogous situation occurred in 1981-82 when the Commission discovered ,
following various checks , that the price increases provided for in the
undertakings accepted in 1980 had been only partially passed on to the
market .
As indicated at point 19 of Regulation ( EEC ) No 3019 / 86 , the checks
carried out during this proceeding , which took place throughout most of
1985 , revealed the same phenomenon as had occurred during the previous
 ---pagebreak---                                          - 19 -
^ gwgp-proceedings : the price undertakings - which are binding on the
  exporters only - had apparently been honoured , but the price undercutting
  and the level of injury which these undertakings were supposed to reduce
  substantially continued as before .
  22 .   The second argument put forward by the exporters concerned essentially
  the question of cumulation .      In order to assess the impact which the
 dumped imports had on the Community industry , the Commission considered the
  impact of all the dumped imports from the seven exporters concerned as a
 whole .
  In considering whether cumulation was appropriate in each case , the
  Commission took into consideration the comparability of the imported products
  in terms of their physical characteristics , the quantities imported , the very
  low level and the similarity of the prices charged by all the exporters
 concerned and the extent to which each imported product competed within the
  Community with a similar product of the Community industry .
 On the basis of this analysis , the Commission can only note the fungible
 nature of the products concerned - that is their interchangeability and
 the comparability of their physical characteristics - and the similarity of
 prices as between one exporter and another .
  In terms of volume , exports from the USSR , the German Democratic Republic
 and Czechoslovakia increased , those from Bulgaria remained stable and
 exports from Poland , Hungary and Romania fell , as set out at point 25 of
  Regulation ( EEC ) No 3019 / 86 .
 However , the Commission considered that failure to take account of the
 quantities exported by exporters with stable or falling exports would be
 ---pagebreak---                                     - 20 -
equivalent to ignoring the interchangeability of the motors in ter‘m§ w6f
their physical characteristics and price ; it would further ignore the
fact that imports were still being dumped , despite the fall in volume ,
whereas Article 4(1 ) of Regulation ( EEC ) No 2176 / 84 expressly provides
that "dumped imports " must be considered for the determination of injury .
The Commission is therefore of the opinion - and the Council shares this
view - that all the dumped imports from the state-trading companies
concerned must be considered to be contributing to the material injury
suffered by the Community standardized electric motor industry ; moreover ,
these imports took place under similar conditions , and to treat one
exporter separately for the determination of injury would thus be to
discriminate against the others .
The Council therefore considers that for the definitive determination of
injury all dumped imports from all of the exporters concerned by this
proceeding should be considered as a whole .
23 .  TRANSELECTRO , the Hungarian exporter , disputed the volume of imports
of standardized electric motors from Hungary .      However , it did not supply
any evidence to support its claims that its exports consisted largely of
motors for special purposes and fell outside the scope of this proceeding .
In particular , the exporter refused to reply to a request from the Commission
which would have enabled it to back up its claim with convincing facts .        In
these circumstances , the Council considers that the Hungarian request for
figures other than official Community statistics to be taken into account
should be rejected .
 ---pagebreak---                                        - 21
Price-linked factors affecting injury
24 . The exporters and some importers disputed the procedure , followed in
Regulation ( EEC ) No 3019/ 86 and set out in point 20 of that Regulation,
which consists of calculating the difference between the cost price of
the most efficient industrial-scale domestic manufacturers on each market
and the resale price of motors originating in the state-trading countries .
It is nevertheless clear that in a market such as that for standardized
electric motors , where prices are depressed and almost all manufacturers
are selling at a loss , calculating the price undercutting margin simply
by taking the difference between the manufacturer 's sales price and the
importer 's resale price does not reflect the real injury to the industry ,
since the industry is , precisely , selling at less than its cost price .
The Council therefore confirms the validity of the method applied by the
Commission in Regulation ( EEC ) No 3019 / 86 .
25 .  Regarding the Community 's manufacturers' production costs , the
Commission and the Council consider that these have been checked as much
as is necessary during both the preliminary and final phases of the
investigation , and that the figures at their disposal are an accurate
reflection of the real economic position of the different Community
manufacturers .    In addition , the Commission in the final phase of its
investigation checked the production costs - and the sales prices - of
additional Italian manufacturers which some importers had indicated to be
particularly efficient .     Lastly , it extended its enquiry to include the
principal United Kingdom manufacturer .
These additional checks have led the Commission to modify some of the
perameters of its analysis of the injury . The arithmetic mean of the cost
prices of the main industrial-scale Community manufacturers in 1985 was
 ---pagebreak---                                      - 22 -
finally established as follows :
      1.1 kW :      80.63 ECU
      3.0 kW :     127.81 ECU
      5.5 kW :     212.54 ECU
     11    kW :    387.17 ECU
     30    kW :    931.48 ECU
     75    kW :  2 368.08 ECU
The weighted average was fixed at slightly higher levels .
26 .    Although the sales prices of almost all the Community manufacturers
examined are , with two exceptions , lower than their cost prices , the Council
judges that , in the interests of openness and thoroughness , it is appropriate
to show the price undercutting margins calculated according to the
difference between Community manufacturers' sales prices and the importers'
resale prices .    In each of the main Member States concerned by this
proceeding , the price undercutting margins were calculated in relation to
the sales prices of the most efficient manufacturers :
Price undercutting margins expressed as a percentage of the sales price of
the most efficient national manufacturer on each market
  %                              F                 I               BLEU
 kW
  1.1                       17.9 to 27.4      10.8 to 26.2     24.4 to 34.0
  3                         13.3 to 31.2       1.8 to 24.3     21.7 to 31.8
  5.5                       21.9 to 46.7       6.8 to 29.2     14.2 to 23.4
 11                         30.7 to 47.2      19.5 to 36.7      7.2 to 26.8
 30                         30.5 to 48.1       4.6 to 27.1      7.2 to 32.4
 75                         27.8 to 44.5       0.8 to 22.5     28.8 to 47.6
 ---pagebreak---                                      - 23 -
The table above shows that the ex-importer resale prices of motors
originating in state-trading countries are clearly very far below
Community manufacturers' sales prices , even in Italy , where the market
is nevertheless most depressed .    The fact that , on this market in
particular and in a very limited number of transactions , the prices of
dumped imports have been undercut by some Community manufacturers in an
attempt to defend their market share is not sufficient for a determination
of no injury or causal link , despite the arguments of certain exporters .
27 .   As the Community manufacturers' definitively established costs are
far higher than their sales prices , the price undercutting margins are
even greater when expressed as a percentage of the manufacturers' costs :
Price undercutting margins expressed as a percentage of the costs of the
most efficient national manufacturers on each market^
                DF                          I           BLEU
 kW
  1.1       34 to 45     36 to 47      17 to 32      28 to 37
  3         33 to 44     32 to 50       2 to 23      25 to 35
   5.5      31 to 44     42 to 60      10 to 31      24 to 32
 11         31 to 44     39 to 55      18 to 35      17 to 35
 30         33 to 45     35 to 55        5 to 19     12 to 36
 75         33 to 55     29 to 45      29 to 53      18 to 40
^See point 22 of Régulation ( EEC ) No 3019/86 .
 ---pagebreak---                                     - 24 -
The Council 's conclusive finding is therefore that the resale prices
of motors originating in the state-trading countries are far too low
to enable Community manufacturers to cover their costs ( i.e. production
costs plus overheads and general expenses excluding profit ), whichever
market is considered .
Macro-economic factors and impact on Community manufacturers
28 .  Although the information collected by the Commission concerning
the trend of production and sales of Community manufacturers of
standardized electric motors does not lead to the conclusion that the
volume of , and the extent of price undercutting on , imports of the motors
concerned originating in the state-trading countries have had a visible
adverse impact on these manufacturers , the same is not true of information
on other relevant factors such as the market share of imports , the sales
prices of Community motors , operating profits , return on investments and
employment in the standardized multi-phase motors sector .
29 .  Information gathered during this and previous proceedings shows
that for several years Community manufacturers have been forced to sell
their standardized motors at prices far below those necessary to cover
their production costs , despite the price undertakings previously accepted
by the Community institutions .   This situation has forced Community
manufacturers of standardized motors to finance investment indispensable
for maintaining their production facilities from profits made in their
other areas of activity .
 ---pagebreak---                                      - 25 -
Despite a growth in sales and production since 1982 due to the recovery
of economic activity and consumption in the Community ( up by 19.8%
between 1982 and 1985 ), Community manufacturers , with the exception
of two of the companies examined, have not been able to operate profitably
in the standardized motor section in question . For the motors in the
sample , operating losses in 1985 expressed as a percentage of costs
varied between 2% and 25% . The only two companies to make profits
in this sector had gross profit margins of (3.90%) 8 and ( 9%) 8 of
costs respectively . In this respect it is significant that the company
achieving the latter ( relatively high ) rate of profit is situated in
the United Kingdom, where import penetration by state-trading countries
is very low ( only 4.5% of the market ).
Finally , employment directly related to the production of such electric
motors in the Community continued to decline between 1982 and 1985 ,
falling to 5 040 in 1985 . It must be remembered that in 1978
23 630 people were directly employed in manufacturing standardized
electric motors .
30 . None of the manufacturers / exporters or importers concerned has ,
then , presented the Commi ssion with arguments sufficiently convincing
to challenge the conclusion that imports of standardized multi-phase
motors originating in the state-trading countries were causing material
injury to the Community industry concerned .
Q
  Confidential figures , omitted in accordance with Article 8 of Regulation
  ( EEC ) No 2176 / 84 .
 ---pagebreak---                                      - 26 -
The Commission has examined the other factors which , according to the
exporters, might also have damaged the interests of the Community
producers .
Other causes of injury
31 . According to the exporters , extra-Community imports into Italy
other than those originating in the countries concerned by this proceeding
have increased substantially . Italian statistics for 1985 on imports
of standardized multi-phase electric motors of the output in question
showed 411 000 motors originating in Yugoslavia and 217 000 originating
in Hong Kong . However , the reliability of these figures has , since
the beginning of the proceeding , been disputed by almost all the Italian
firms and organizations consulted, their opinion being that single-phase
motors - not covered by the proceeding - had been declared , whether
intentionally or in error , as multi-phase motors . According to these
sources , all motors imported from Hong Kong were in fact micro-motors
not covered by the proceeding .
As regards imports of Yugoslav motors , the Commission is currently
undertaking an anti-dumping proceeding parallel to this proceeding ,
and the preliminary findings of this proceeding have led the Commission
to impose a provisional anti-dumping duty on imports of the motors
        . .   9
in question .
32 . As regards the argument that Community manufacturers have not
rationalized sufficiently , some exporters - particularly those from
the GDR and the Soviet Union - put forward the view that the Community
9
  0J No L        ... 3.1987 , p. ...
 ---pagebreak---                                     - 27 -
 manufacturers' costs were too high and that this situation stemmed from
 the ovei–fragmented structure of the Community standardized motor industry .
Concerning this aspect , though it is true that the Community industry
still has a large number of production units , it must be noted C that
more than x of them have closed in the last y years J. The industry
has made considerable efforts towards automation as is shown by the
drastic reduction in direct employment and the reduction in manufacturing
times to extremely competitive levels ( less than ( 60 ) minutes for a four-pole
                        10
motor - B3 - 1.1 kW ) .
In parallel with these efforts towards automation , a process of relocation
of production plants in the new Member States of the Community ( Spain
and Portugal ) has begun .
Finally , the Commission and the Council note that the most efficient
Community manufacturers are those which have been able on the one hand
to cut their general expenses , and on the other hand to develop
production facilities on a medium but optimum scale , extremely flexible
and providing good conditions for manufacturing standardized motors
and all derived products in the " rotary machines " sector .
33 . As regards the argument of intra-Community competition, it is true
that , on the whole , Italian manufacturers have the lowest production
costs and general expenses , for reasons related to their economic
environment .
   In the text of this Regulation, which is for publication , certain
   figures have been omitted in accordance with Article 8 of
   Council Regulation ( EEC ) No 2176 / 84 on non-disclosure of business
   secrets .
 ---pagebreak---                                       - 28 -
The assessment of price factors affecting injury carried out at points 24
to 27 has , however , shown significant price undercutting in relation
both to the sales prices charged by industrial-scale Italian manufacturers
and to their costs .
C The Commission is aware of the fact that small-scale Italian artisanal
manufacturers locally charge prices comparable to those of motors
originating in the state-trading countries . However , it must be emphasized
that these manufacturers have only regional sales networks ; in addition ,
the Commission has reason to believe that a significant proportion of
these motors are assembled using parts originating in these very state ¬
trading countries . The Commission therefore considers itself justified
in not taking into account the production costs C and the impact J of
the manufacturers in question , and the Council shares this view . J
34 . In addition to the exporters' arguments set out at point 20 , and
answered by the Commission at points 21 to 33 , the exporter from the
Soviet Union had claimed two allowances - see point 13 ( iii ) and ( iv )
- which in fact concern the assessment of injury .
- In determining price undercutting , the Commission compared products
  which are like products within the meaning of Article 2(12 ) of
  Regulation ( EEC ) No 2176 / 84 , but did not attempt to establish the
  effect of buyers' preferences , which would be a subjective judgment
  and difficult to quantify . No hard evidence has been provided
  concerning the precise effect of any possible preference on the part
  of the buyers on the price which they would be prepared to pay for the
  different motors .
- The Commission also in each case , duly took account of the importers'
  sales prices in its price undercutting calculations , and there is here
 ---pagebreak---                                     - 29 -
       no reason to make any allowance whatever . / In calculating the level of
       duty necessary to eliminate the injury in question , the Commission
      quite naturally had to take into account only the importers'
      average import margin , which has been conservatively estimated
      at 40% of the import price . J
C2Q£iy§i22§_l2*i§£22£2_2fJD§£®El§.k_lQiyEZ_3Q£L£2y§al_link )
35 . As regards injury , the definitive results of the investigation
confirm that the difficulties experienced by Community manufacturers
as a result of the very low priced dumped imports of motors originating
in the state-trading countries in question have not been eliminated .
Almost all manufacturers , in 1985 , continued to suffer substantial
financial losses in the standardized multi-phase motor sector , despite
a slight improvement in their market shares .
  - Certainly , intra-Community competition by certain Italian
     manufacturers contributed to the difficulties of the highest-cost
     Community manufacturers . Nevertheless , the Commission 's overall
     finding was that the f ree -at - Community -f rontier prices of imports
     of motors originating in the Eastern European countries were
     equivalent to approximately half the cost prices of the industrial -
     scale Italian manufacturers , whose costs are among the lowest in
     the Community ; similarly , during the reference period the Italian
     importers' resale prices undercut the Italian industrial-scale
     manufacturers' prices more or less systematically and to a significant
     extent .
  - The investigations showed that the price undertakings previously
     accepted by the Community institutions had become manifestly
     insufficient to cover the Community manufacturers' present costs .
     In particular , the adjustments carried out in 1984 had no effect
 ---pagebreak---                                    - 30 -
     on the value in ECUs of these undertakings , but dealt with the
     exchange rates to be applied by the exporters . The adjustments
     in question , then , reflected only currency fluctuations and not
     changes in the other economic parameters .
     What is more , the investigation has shown that apart from their
     insufficient price levels , the previous price undertakings
     presented an unbalanced price structure in relation to Community
     manufacturers' present overall price structure .
   - The market share held by the state-trading countries in question
     certainly diminished between 1982 and 1985 ( from 23.3% in 1982
     to 20.3% in 1985 ), and overall the Community manufacturers'
     share recovered ( by 1.5% ). It is nevertheless the case that
     dumped imports , by maintaining an overall market share of above
     20% , have exerted considerable downward pressure on Community
     manufacturers' prices , as is proven by the existence of clear price
     undercutting on all markets .
  - Moreover , it   is clear that the whole of the price undercutting
     margins detected , whether in relation to the manufacturers' sales
     prices or costs , can be explained by the dumping practised by
     the exporters in question .
36 . In conclusion , taking account of all the factors affecting injury
which the Commission in Regulation ( EEC ) No 3019 / 86 subjected to a
preliminary investigation and of the assessment at points 19 to 35
of that Regulation , the Council declares its belief that the injury
caused by the massively dumped imports originating in the state-trading
countries must , taken individually, be considered material injury .
 ---pagebreak---                                    - 31
G.   Community interest
37 . Several exporters and importers argued that there was a danger of an
anti-dumping duty as imposed by Commission Regulation No 3019 / 86 leading
to a very considerable drop in imports of standardized multi-phase motors
into the Community . They also put forward the argument that this type of
measure would have adverse effects on compensation agreements with the
state-trading countries in question . The exporters from the Soviet Union
and the GDR in particular emphasized the number of special motors bought
by their countries from the Member States of the Community .
Lastly , some assemblers , in particular manufacturers of pumps , drew the
Commission 's attention to the high proportion of their costs accounted for
by the price of motors .
38 .  The Commission took all of these observations into account .
However , it also took into account the Community manufacturers' financial
losses in the standardized multi-phase electric motors sector , and the
fact that this sector is central to the Community " rotary machines "
industry , whose economic , social and even strategic importance from an
industrial point of view is considerable .   All rotary machines ( retarders ,
flame-proof motors , step-down motors , variable-speed motors etc . _ )
incorporate one or more standardized motors , or motors derived from
standardized motors .
The investigation showed that very low price dumped imports of standardized
motors were threatening to have , or were already having , adverse effects
on other activities in the " rotary machines " industry , in particular in
Italy where there is considerable compensation trade involving imports of
standardized motors and of parts for motors . A similar situation , with
 ---pagebreak---                                      - 32 -
assembly plants being set up , has appeared in the Netherlands and in the
GDR .
The Council views these developments , which threaten to wipe out the
efforts of the most efficient manufacturers and which are taking place
as the accession of Portugal and Spain gives Community manufacturers the
opportunity to relocate , as harmful to the Community interest , and considers
that a stop should be put to them .
39 . The Council therefore considers that Community interests require the
adoption of a commercial protective measure against the imports proved to
have been dumped , in order to eliminate the injury caused by these imports .
However , given the intensity of intra-Community competition in the
standardized multi-phase motor sector and the need to maintain as far as
possible the competitiveness of the downstream industries , the Council
believes it appropriate to determine the level of the measure to be taken -
whatever its form - on the basis of the costs of the most efficient
industrial-scale manufacturers / and not on the basis of the average costs
of the Community manufacturer!?.
H.    Undertaking
40 .   Certain manufacturers / exporters offered the Commission undertakings
concerning their future exports to the Community .
41 .   The Commission did not accept these undertakings , except that
offered by the Romanian exporter , but informed the manufacturers / exporters
concerned of the reasons for these decisions . £ln particular , the
Commission emphasized that the price undertaking by the Romanian exporter
had been accepted only because this exporter 's market share had fallen
to a negligible level during the reference period, and since , in addition,
this exporter did not market its products through associated importersJ7
 ---pagebreak---                                        - 33 -
I.    Form and rate of the duty
42 . Regarding the form of the anti-dumping duty to be imposed on imports
originating in the countries concerned , the Council confirms its view
that , given the wide variety of motors in question and the fact that
they originate in state-trading countries , the most appropriate type
of anti-dumping duty in this case , both in the interests of maximum
transparency and in order to induce exporters to raise their prices ,
is a variable duty calculated according to the difference between the
minimum price expressed in ECUs for each type of motor and the import
price for the first independent buyer .
As the investigation revealed that a substantial number of importers
were linked to an exporter by an association or a compensatory
arrangement with a third party within the meaning of Article 2(8 ) ( b )
of Regulation ( EEC ) No 2176 / 84 , the Council considers it necessary ,
in the interests of effectiveness , to enjoin the customs authorities
to take as a reference point in calculating the anti-dumping duty only
the price paid by the first buyer not associated with the exporter .
In the case of motors imported by associated importers , the free-at -
Community frontier unit price shall correspond to the customs value
as determined in accordance with Article 6 of Council Regulation
                                                                      11
( EEC ) No 1224 / 80 on the valuation of goods for customs purposes .
11
   OJ No L 134 , 31.5.1980 , p. 1 .
 ---pagebreak---                                      - 34 -
43 . The minimum price for each type of motor concerned was calculated on
the basis of the production costs of the most efficient industrial
producers .  A gross profit margin of 4% of production costs was finally
taken into consideration on account of the fierce competition between
Community producers .
On the basis of the reference Community production costs and profit
margin referred to above, /and7 taking due account of differences in
the physical characteristics of the imported motors and the Community
motors / and allowing a reasonable margin of penetration , i.e. of price
undercutting /, the Commission determined the necessary price increases
at the cif f ree -at -Community frontier stage ( see Annex ).
The price increases for 4-pole motors represent approximately 25% of
the import prices during the reference period .
Thus the rate of anti-dumping duty is much lower than the dumping margins
established . However , in view of the sale price needed to provide
efficient Community producers with a reasonable profit , it should be
sufficient to remove the injury caused to Community production of
standardized motors by the imports concerned .
J.   Collection of provisional duties
44 . The amounts secured by way of provisional anti-dumping duty should,
therefore , be collected at the level of the definitive duty imposed .
For imports originating in Romania , the amounts secured by way of
provisional anti-dumping duty should be collected for each type of
motor at a level equal to the difference between the net unit price
 ---pagebreak---                                         - 35 -
free at Community frontier , not cleared through customs , and the
price specified in the Annex .
HAS ADOPTED THE FOLLOWING REGULATION :
                                      Article 1
1 . A definitive anti-dumping duty is hereby imposed on imports of
standardized multi-phase electric motors having an output of more than
0.75 kW but not more than 75 kW , falling within subheading ex 85.01 Bib )
of the Common Customs Tariff , corresponding to NIMEXE code ex 85.01-33,
85.01-34 or ex 85.01-36, originating in Bulgaria , Czechoslovakia , the
German Democratic Republic , Hungary , Poland or the USSR .
2 . The expression " standardized motors " is taken to include all
" standard " types of motors - which are priced by reference to an official
scale of prices - and all motors with " standard" modifications - the
additional cost of the modifications also being calculated by reference
to an official scale of prices for " standard" modifications .
The motors concerned are defined in terms of their power and their
speed of rotation ( in rpm ).      The motors concerned are of the following
powers : 1.1 , 1.5 , 2.2 , 3 , 4 , 5.5 , 7.5 , 11 , 15 , 18.5 , 22 , 30 , 37, 45 ,
55 or 75 kW ; and of the following rotation speeds : 3 000 rpm ,
1 500 rpm , 1 000 rpm or 750 rpm .
 ---pagebreak--- 3.    The amount of duty shall be equal , for each type of motor , to the
difference between the net unit price , free at Community frontier , not cleared
through customs , and the price specified in the Annex .
The said f ree-at -Community-f rontier price , not cleared through customs ,
shall be net if the actual terms and conditions of sale provide that
payment shall be made within 30 days of the date of dispatch ; it shall be
lowered by 1% for each month by which payment is actually deferred .
4. (a)   Where it appears to the customs authorities that there is an
association or a compensatory arrangement between the exporter and the
importer or a third party within the meaning of Article 2(8 ) ( b ) of
Regulation ( EEC ) No 2176 / 84 , the price actually paid or payable for the
product sold for export to the Community may not be used as a reference for
the determination of the net unit price , free at Community frontier , referred
to in paragraph 3 .
In this case the net unit price , free at Community frontier , shall be the
customs value as determined in accordance with Article 6 of Council
                                                                                 12
Regulation ( EEC ) No 1224 / 80 on the valuation of goods for customs purposes .
(b)   The provisions of ( a ) above shall apply in particular to motors
originating in the countries concerned and imported by the companies named
below , in respect of which the Commission 's investigation showed that there
was an association or a compensatory arrangement with an exporter within the
meaning of Article 2(8 ) ( b ) of Regulation ( EEC ) No 2176 / 84 :
 ---pagebreak---                                        - 37 -
  Importers                                        Motors originating in :
  Enital , Mi lan                                  USSR
  Mezz-italiana , Milan                            Czechoslovakia
  Sofbim , Argenteui l                             Bulgaria
  Stanko-f rance , Longjumeau                      USSR
 ζ Eltrans , Schwelm                               Hungary J
  Neotype Techmaschexport , Bergisch Gladbach      USSR
  Elprom , Borken / Hessen                         Czechoslovakia
  PEJA , Arnhem                                    Czechoslovakia
5.     The provisions in force with regard to customs duties shall apply ,
subject to the provisions of this Regulation .
                                     Article 2
1.     With regard to the imports concerned originating in Bulgaria ,
Czechoslovakia , the German Democratic Republic , Hungary , Poland or the
USSR , the amounts secured by way of the provisional anti-dumping duty
imposed by Commission Regulation ( EEC ) No 3019/ 86 and extended by Council
Regulation ( EEC ) No 254 / 87 shall be collected definitively at the level
of the definitive duty imposed .
2 . With regard to imports originating in Romania , the amounts secured
by way of provisional anti-dumping duty shall be collected definitively
 ---pagebreak---                                     - 38 -
for each type of motor at a Level equal to the difference between the
net unit price , free at Community frontier , not cleared through customs ,
and the price specified in the Annex .
                                   Artide 3
This Regulation shall enter into force on the day following its
publication in the Official Journal of the European Communities .
This Regulation shall be binding in its entirety and directly applicable
in al'l Member States .
Done at Brussels ,      March 1987
                                             For the Council
                                             The President
 ---pagebreak---                                       - 39 -
                                       ANNEX
Minimum prices on in port into the Community of certain standardized
multi-phase electric motors originating in Bulgaria , Czechoslovakia ,
the German Democratic Republic , Hungary , Poland , Romania or the USSR
The minimum import prices referred to in Article 1(3 ) of this Regulation
are those given in the Table below , expressed in ECUs .
The prices given are for type B3 multi-phase electric motors ( i.e.
those with retaining legs ).
For other motors ( type B5 , B14 , etc .), an additional amount of ...%
shall be added to the prices specified below .
 kW      horsepower      3 000 rpm        1 500 rpm     1 000 rpm
 1.1        1.5
 1.5        2
 2.2        3
 3          4
 4          5.5
 5.5        7.5
 7.5       10
11         15
15         20
18.5       25
22         30
30         40
37         50
45         60
55         75
75        100