CELEX: 51998PC0805
Language: en
Date: 1999-01-06
Title: Proposal for a Council Regulation (EC) imposing definitive anti-dumping duties on imports of hardboard originating in Bulgaria, Estonia, Latvia, Lithuania, Poland and Russia and definitively collecting the provisional duties imposed

COMMISSION OF THE EUROPEAN COMMUNITIES
                                                  Brussels, 06.01.1999
                                                  COM(1998) 805 final
                                   Proposal for a
                         COUNCIL REGULATION (EC)
imposing definitive anti-dumping duties on imports of hardboard originating in
   Bulgaria, Estonia, Latvia, Lithuania, Poland and Russia and definitively
                    collecting the provisional duties imposed
                          (presented by the Commission)
 ---pagebreak---  ---pagebreak---                         EXPLANATORY MEMORANDUM
The Commission initiated an anti-dumping proceeding concerning the imports of
hardboard from Brazil, Bulgaria, Estonia, Latvia, Lithuania, Poland and Russia on
7 November 1997 through a publication in the Official Journal of the European
Communities No C 336, page 2.
Provisional anti-dumping measures were imposed by Regulation (EC) No 1742/98 on
6 August 1998 after injurious dumping had been established.
At that stage, except for the Russian producers, all exporting producers concerned
offered price undertakings. These exporting producers undertook to sell certain
product-types for export to the Community, up to a pre-determined annual quantity
exempted from anti-dumping valorem duty, at prices removing the injurious effect of
the dumping. For export sales volumes of these product-types beyond the pre-
determined annual quantity-ceilings, the provisional anti-dumping ad valorem duty
rates would apply. The Commission, being of the opinion that this system is workable
and can be effectively monitored, accepted these undertakings.
Following the imposition of provisional anti-dumping measures, all interested parties
were given the opportunity to request a hearing and to submit additional comments.
For the definitive findings, the Commission made some adjustments to its analysis in
accordance with some of the interested parties' submissions. In particular, the
Commission decumulated Brazilfromthe analysis.
 ---pagebreak--- The definitive findings confirmed the existence of dumping and resultant injury to the
Community industry with the exception of Brazil. As regards imports from this
country, these were not found to have been a cause of the injury suffered by the
Community industry. The Commission therefore proposes the termination of the
proceeding against Brazil without measures. As to the imports from the other
countries concerned, however, these were confirmed as having been a cause of the
material injury suffered by the Community industry.
The investigation, taking into account all interests involved, with particular regard to
the interests of the user industry, also led to the conclusion that it is in the Community
interest to take definitive anti-dumping measures.
Since all the exporting producers concerned, except for the Russian ones, offered
undertakings at the provisional stage, it is proposed that these undertakings continue,
taking into account any adjustments resulting from the definitive analysis. A separate
Commission Decision detailing the changes to the undertakings is to be published on
the same date as the Council Regulation imposing definitive anti-dumping measures.
With the termination of the proceeding as regards imports from Brazil, the
undertakings offered by the Brazilian exporting producers will lapse.
 ---pagebreak--- In the light of the above, and in accordance with Article 9 of Council Regulation (EC)
No 384/96, the Commission therefore proposes that the Council approve the
imposition of a definitive anti-dumping duty on imports from Bulgaria, Estonia,
Latvia, Lithuania, Poland and Russia, and terminate the proceeding against Brazil
without measures. The proposed duty rates are as indicated in the table below.
    Country                 Company            Rate of duty Taric additional
                                                   (%)              code
Bulgaria           Fazerles AD                      7.1                    8461
                   All other companies              7.2                    8900
Estonia            All companies                    6.0                        -
Latvia             All companies                    4.7                        -
Lithuania          All companies                   11.4                        -
Poland             Alpex-Karlino S.A.              22.4                    8479
                   Ekopryta S.A.                    7.0                    8480
                   Zaklady Pryt Pilsniowych         9.1                    8481
                   S.A., Przemysl
                   Koniecpolskie Zaklady Pryt      11.4                    8494
                   Pilsniowych S.A
                   Zaklady Pryt Pilsniowych        11.0                    8495
                   S.A w Krosnie Odrzanskim
                   All other companies             34.8                    8900
Russia             All companies                   30.6                       -
 ---pagebreak---                          COUNCIL REGULATION (EC) No ...
                                             of
 imposing definitive anti-dumping duties on imports of hardboard originating in
     Bulgaria, Estonia, Latvia, Lithuania, Poland and Russia and definitively
                        collecting the provisional duties imposed
THE COUNCIL OF THE EUROPEAN UNION,
Having regard to the Treaty establishing the European Community,
Having regard to Council Regulation (EC) No 384/96 of 22 December 1995 on
protection against dumped imports from countries not members of the European
Community1, and in particular Article 9(4) thereof,
Having regard to the proposal submitted by the Commission after consulting the
Advisory Committee,
Whereas:
1
    OJ L 56, 6.3.1996, p. 1. Regulation as last amended by Regulation (EC) No 905/98 (OJ L 128,
    30.4.1998, p. 18).
                                                                                                h
 ---pagebreak---                             A. GENERAL INFORMATION
      1. Provisional measures
(1)   Provisional anti-dumping measures were imposed in the present proceeding on
      6 August 1998 by Regulation (EC) No 1742/982 (hereinafter referred to as the
      "provisional Regulation"). Undertakings were offered and accepted from the co-
      operating exporting producers in all the countries concerned except Russia.
      2. Subsequent procedure
(2)   Following the imposition of the provisional measures, certain exporting
      producers, importers and Community users of the product concerned submitted
      comments in writing. Those parties who so requested were granted an
      opportunity to be heard.
(3)   Since the publication of the provisional Regulation, investigations were carried
      out at the premises of the following companies which are users of the product
      concerned in the manufacture of doors:
       Svedex BV, Netherlands
       Swedoor, a division of Nobia Nordisk Bygginteriôr AB, Sweden (two
    - production plants)
      Righini SA, France
      Huet SA, France
      Theuma Deurenindustrie NV, Belgium.
      A non-complainant producer of eucalyptus hardboard was also visited:
       Industria de Fibras de Madeira, Portugal,
      as was an unrelated importer of hardboard:
       Firma Christian Kroger GmbH & Co. KG, Germany.
2
     OJL218, 6.8.1998, p. 16.
                                                                                        f
                                                                                       J
 ---pagebreak---      B. PRODUCT UNDER CONSIDERATION AND LIKE PRODUCT
     1. Product under consideration
(4) The product under consideration in this anti-dumping proceeding is hardboard.
    Hardboard is defined asfibreboardof wood or other ligneous materials, whether
    or not bonded with resins or other organic substances and with a density
    exceeding 0.8 g/cm3, currently classifiable under CN codes ex 4411 11 00 and
    ex 441119 00.
    Hardboard is exclusively obtained from a 'wet production process' (as opposed
    to dry-process fibreboards as described below) and normally has a density of
    800 to 1050 kg/m3 and is made in thicknesses between 1.8 to 6.0 mm.
    Hardboard is typically used in the manufacture of furniture, in the construction
    and automotive industries, for door skins and for packaging, especially fruit and
    vegetable packaging.
    2. 'Thin' dry-process fibreboards
(5) After the imposition of the provisional anti-dumping measures, a number of
    importers and users continued to argue for an extension to the product scope of
    the proceeding. In particular, they argued that the so-called 'thin' forms (less
    than 6 mm thickness) of dry-process fibreboards such as medium and high
    densityfibreboard(thin MDF and HDF) and hardboard have essentially the
    same end uses, and therefore together form a single product. It was therefore
    alleged that the scope of the analysis of dumping, injury and Community
    interest should also include all these products.
                                                                                      G
 ---pagebreak--- (6) On the basis of the information submitted up to the provisional stage a
    preliminary assessment of the extent to which the end-uses of hardboard and
    thin dry-process fibreboards overlap was made. Based on the information
    submitted since the provisional Regulation a definitive assessment has been
    made and it has become clear that, theoretically, such overlap is substantial and
    that only for some market segments are the two products not at all
    interchangeable.
(7) However, similarity of end uses does not alone determine the question of like
    product. The conclusions of the provisional investigation that hardboard and
    thin dry-process fibreboards were not a single product were based on
    differences of physical and chemical characteristics of the two products. Further
    investigation of the issues involved has allowed the following refinements of the
    analysis:
    - it is confirmed that the thin HDF variant of dry-process fibreboards can be
       produced in densities comparable to or higher than the density of hardboard.
        With its density defined as being above 800 kg/m , it is thin HDF which can
       be considered the closest to hardboard:
                                                                                      ?
 ---pagebreak--- however, the average prices for thin HDF were higher than those for thin
MDF (10-15% on average) and for most hardboard of equivalent board
thicknesses under 6mm, so that over the period investigated it was mainly
thin MDF (density lower than 800 kg/m3) which competed on the market
with hardboard over a large part of its final uses, particularly in the furniture
sector, in part of the packaging sector, in the picture frames sector and in a
part of the doors sector;
it was also pointed out that new, zero-emission thin dry-process fibreboards
are in production, i.e. thin dry-process fibreboards             containing no
formaldehyde. This development allows thin. dry-process fibreboards to
compete in the market of food packaging from which it has hitherto been
excluded because of its formaldehyde content. However, these zero-emission
products are a very recent innovation, and, although it is conceivable that
thin dry-process fibreboards could in the future be used in the area of food
packaging, their higher price would probably preclude this at the present
time. As these developments relate to periods subsequent to the investigation
period, they could not be investigated;
 ---pagebreak--- the fact that thin dry-process fibreboards and hardboard share a number of
end uses does not imply that the market considers them as a single product.
Indeed, most operators in the sectors involved have confirmed that, in
practice, they do not use the different board-types indiscriminately because
of the different physical characteristics and technical performances of the
two products; rather, they choose between them according to which best suits
their technical requirements. As an example, thin MDF has an advantage
when it has to be laminated, due to its more porous and matte surface.
Moreover, its internal structure is smooth and not layered like hardboard, and
it does not have the tendency to split when submitted to tension. As a
consequence, thin MDF is generally preferred to hardboard for the
manufacture of laminated doors and furniture elements. On the other hand,
hardboard generally has a distinct advantage in those uses where density
and/or suppleness of the panel are required, such as in lacquered and pre-
painted doors or automobile parts, or where it is thought that the resins
contained in thin dry-processfibreboardswould have, as explained above, a
possible impact on health, such as in fruit and vegetable packaging.
 ---pagebreak--- (8)  In conclusion, the definitive analysis confirms the provisional findings that
     hardboard and thin dry-process fibreboards, although they are theoretically
     interchangeable for many end uses, are not, in practice, a single product because
     of the differences in their physical and chemical characteristics.
(9)  Nevertheless, although thin dry-process fibreboards do not form a single
     product with hardboard, it was claimed that the extent of the overlap in their
     end-uses has important implications for the analysis of the causes of any injury
     suffered by the Community industry. This issue is addressed below under
     causation.
     3. Plywood and chipboard
(10) Submissions were received clarifying the arguments presented at the provisional
     stage of the investigation that plywood and chipboard panels were also
     interchangeable with hardboard in many of their applications. However, for the
     same reasons as were outlined for thin dry-process fibreboards above,
     theoretical similarity of end uses does not alone determine the question of single
     product. Since the physical and chemical characteristics of hardboard are
     different to chipboard and plywood panels, it cannot be considered to be a
     single product with them.
     The provisional findings are therefore confirmed.
                                                                                        Ao
 ---pagebreak---      4. Like product
(11) The further investigation confirmed that there were no differences in the basic
     characteristics and uses of the hardboard imported into the Community from the
     countries concerned and the hardboard produced by the Community industry
     and sold on the Community market. The same is true with regard to hardboard
     produced and sold on the domestic markets of Brazil, Bulgaria, Estonia, Latvia,
     Lithuania and Poland (the latter served also as an analogue country for imports
     from Russia). It was therefore concluded that both the hardboard produced and
     sold by the Community industry on the Community market and the hardboard
     produced and sold on the domestic markets of Brazil, Bulgaria, Estonia, Latvia,
     Lithuania and Poland were, within the meaning of Article 1(4) of Regulation
     (EC) No 384/96 (hereinafter referred to as the "basic Regulation"), alike to the
     hardboard imported into the Community from the seven countries subject to
     investigation.
(12) However, the Brazilian exporting producers, as well as a number of users of
     hardboard, in particular manufacturers of doorskins, repeated their claims made
     at the provisional stage that Brazilian eucalyptus hardboard is not a like product
     with the product produced by the Community industry and should be excluded
     from the scope of the investigation.
                                                                                        M
 ---pagebreak--- (13) Among the exporting producers concerned by this investigation, only the
     Brazilian exporting producers supply hardboard made from eucalyptus to the
     Community market. There are also two producers of eucalyptus hardboard in
     the Community, both situated in the Iberian peninsula, which did not participate
     in the complaint which led to the initiation of this proceeding.
(14) These claims in respect of eucalyptus hardboard have been extensively
     investigated. Following the imposition of provisional measures, a number of
     door manufacturers across the Community were visited. In addition, one non-
     complainant Community producer of eucalyptus hardboard in Portugal was
     visited. These visits were aimed at clarifying the issues concerning the inclusion
     of Brazilian hardboard within the scope of this proceeding.
     From these visits, the following became clear:
     (a) The technical properties and uses of eucalyptus hardboard
(15) Numerous technical submissions were received from the Brazilian exporting
     producers, Community door manufacturers, and the complainant concerning the
     properties of eucalyptus hardboard. The exporting producers and door
     manufacturers argue that eucalyptus hardboard has certain unique properties
     which set it apart from any other hardboard types, whether made from softwood
     or hardwood tree species other than eucalyptus. They claim further that no
     viable alternative product is produced by the Community industry. The door
     manufacturers in particular emphasise that the Community industry produces no
     eucalyptus hardboard for doorskins; indeed they point out that the only
     Community-based producer of eucalyptus hardboard which does make
     doorskin-quality boards, and is based in Portugal, is not one of the
     complainants.
                                                                                        fL
 ---pagebreak--- (16) It was found that hardboard made from eucalyptus wood has a number of
     technical characteristics which make it particularly well-suited for doorskins for
     high-quality, finished doors. First, its especially short fibres give the finished
     hardboard a very regular appearance, high density and stronger tensile
     properties than non eucalyptus hardboard. Second, the eucalyptus tree has
     hardly any bark, a factor which ensures that blemishes in the pressed board are
     minimal.
(17) However, it should be borne in mind that the eucalyptus tree is not the only
     species to have short fibres. The complainants have submitted that there are 40
     other species of tree growing in Western Europe which have fibres of about the
     same length as eucalyptus, and in some cases even shorter.
(18) It should also be noted that the high quality required by the door manufactures
     is not limited to the type of wood of which the hardboard is made. Some of the
     chaïacteristics required, such as a constant and reliable thickness of the board
     they use, a high density, a good resistance to high temperatures (doors are
     assembled at above 100°C) and humidity and the absence of surface defects are
     not necessarily linked to eucalyptus, but can also be obtained with other woods,
     with a strictly-controlled production process. It can also be added that, as far as
     the suitability for lacquering is concerned, it was found that some hardboards
     made with wood other than eucalyptus can be lacquered with acceptable results,
     depending on the technique and the quantity of painting material used. The
     advantage of eucalyptus and in general of hardwood hardboard is mainly in the
      smaller quantities of.paint needed to achieve a smooth result.
                                                                                         ^
 ---pagebreak--- (19) Furthermore, the analysis of the door manufacturers' activities also confirmed
     that for unfinished doors, which are primed or pre-painted in white but which
     require finishing by the final customer, doorskins made with different types of
     wood are used. It was also found that some door producers used Community-
     produced hardboard, not made with eucalyptus wood, to make lacquered doors.
(20) It was also found that during the investigation period, eucalyptus hardboard was
     also used for certain applications in the furniture, roofing and automobile
     industries and, as far as off-cuts of hardboard sheets are concerned, for fruit and
     vegetable containers.
     (b) Conclusion on eucalyptus hardboard as like product
(21) The examination of the interested parties' submissions confirms that the
     exceptional properties of eucalyptus hardboard do not technically rule out its
     use in those areas in which other hardboards are also used; indeed, the fact that
     it is not widely used outside the doorskin sector is simply a reflection of the
     relatively higher price at which this product is sold on the market, in
     comparison with other hardwood and softwood hardboards.
      Although, therefore, the eucalyptus hardboard produced and exported by
      Brazilian exporting producers has certain special characteristics, these are not
      sufficient to lead to the conclusion that it is not a product alike to the hardboard
      produced by the Community industry with which it shares the same basic
     physical characteristics and uses within the meaning of Article 1(4) of the basic
      Regulation.
                                                                                           A
 ---pagebreak---                                    C. DUMPING
     1. Specific issues raised with regard to the establishment of dumping for
        each of the countries concerned
     (a) Brazil
(22) In view of the findings on causation in recitals (53) to (56), it is not considered
     necessary to set out any findings in respect of dumping of imports of the
     product concerned from Brazil.
     (b) Bulgaria
(23) The Bulgarian exporting producers made no comments following disclosure and
     the publication of the provisional Regulation.
     The dumping margins expressed as a percentage of the CIF import price at the
     Community border established for the Bulgarian exporting producers remain
     unchanged, i.e.
     FazerlesAD:                            7,1%
     Lessoplast AD:                         7,2%
     Non-cooperating exporting producers: 7,2%
     (c) Estonia
(24) The Estonian exporting producer made no comments following disclosure and
     the publication of the provisional Regulation.
                                                                                         A*-
 ---pagebreak---      The dumping margins expressed as a percentage of the CIF import price at the
     Community border established for the Estonian exporting producers remain
     unchanged, i.e.
     AS Repo Vabrikud:                               6,0%
     Non cooperating exporting producers:            6,0%
     (d) Latvia
     General
     (i)      Product classification
(25) Following the adoption of provisional measures, the Latvian exporting producer
     requested a revision of the classification of some of the company product codes
     into Product Control Numbers. The claim was based on the grounds that some
     company product codes, which were originally incorrectly reported by the
     company as referring to standard products, should be considered as cut-to-size
     products.
     This request has been granted as the company product codes in question did
     indeed not cover standard dimensions.
                                                                                     //6
 ---pagebreak--- Normal value
(i)       Profit margin in constructed normal values
The Latvian exporting producer claimed that when constructing normal values,
the profit earned on sales in the ordinary course of trade should be expressed as
a percentage of the total domestic turnover of the like product of the company -
including the turnover of non-profitable sales - instead of the turnover of the
sales in the ordinary course of trade only. The approach adopted by the
Commission in the provisional Regulation inflates, according to the producer,
the profit margin. The Latvian producer furthermore asserted that there was a
discrepancy between the methods used by the Commission to calculate, on the
one hand, the profit margins by excluding non-profitable transactions as well as
the dumping amounts by excluding negative dumping and, on the other hand,
the calculation of the dumping margins expressed as a percentage of the total
CIF value.
                                                                                  AT-
 ---pagebreak--- This claim had to be rejected. The methods used by the Commission to
construct normal values and to determine which sales had been made in the
ordinary course of trade are described in recitals (29) and (31) of the provisional
Regulation and are in conformity with the rules set out in Articles 2(4) and 2(6)
of the basic Regulation. In particular, it should be added that: First, Article 2(6)
of the basic Regulation clearly specifies that "the amounts (...) for profits shall
be based on actual data pertaining to production and sales in the ordinary course
of trade, of the like product...". Second, the aim is to establish a profit margin
that could normally be attained for sales of a given product on the domestic
market. Third, Article 2(4) of the basic Regulation provides as to when loss-
making sales of a given product may be treated as being in the ordinary course
of trade i.e. if the quantity sold with a loss is below 20% of the total quantity
sold of that product. In that case, only the total turnover of a product including
loss-making transactions is the basis of the profit margin calculation.
Comparison between normal value and export price.
                                                                                     M
 ---pagebreak---      (i)       Allowance for currency conversion
     The Latvian exporting producer had claimed an allowance for currency
     conversion based on a comparison of the amount in Lats the company would
     have obtained using the exchange rate applicable at the time of the conclusion
     of the respective contracts with their customers and the amount actually
     obtained. This claim is based on the assumption that the date of contract is the
     date of sale. In the provisional Regulation, the Commission had rejected this
     claim on the basis that the contracts submitted did not reflect the material terms
     of sale and that the date of invoice more appropriately established these terms.
     The exporting producer reintroduced this claim, adding that contracts could be
     amended. This confirms that the company could react to exchange rate
     variations by amending export prices. Therefore, it is confirmed that such
     contracts do not more appropriately establish the material terms of sale as
     compared to invoices, in particular with regard to the price. The claim could
     not, therefore, be accepted.
     (ii)      Interest rates used for credit purposes
(26) With regard to the credit cost allowance, the Latvian exporting producer claims
     that the deposit rate instead of the credit rate should be used on the grounds that,
     the company having sufficient liquidity, its credit costs are limited to the interest
     earnings not perceived on its bank deposit account.
                                                                                           A°i
 ---pagebreak---      Following the practice consistently applied by the Community institutions, it
     was not found appropriate to base the calculation of the credit cost allowance on
     the deposit rate on the grounds that these constitute opportunity costs as
     compared to actual costs.
     In this context it is noted that the interests customers would have to pay in case
     of payment delays, as stated in the contracts submitted to the Commission,
     suggest that the company determined such interests on the basis of credit rates
     rather than deposit rates.
     (iii)     Depreciation of the machinery of the related domestic producer
(27) The Latvian exporting producer claims that the depreciation of the machinery of
     the related domestic producer should have been calculated on the basis of a 10-
     year depreciation period instead of a 5-year depreciation period.
     Pursuant to Article 2(5) of the basic Regulation, this claim could not be
     accepted as the amount used is in line with the amount declared in the audited
     financial statements of the year 1997 and the application of the 20%
     depreciation amount per year seems therefore to reasonably reflect the
     depreciation costs associated with the production of the product under
     consideration.
                                                                                        U>
 ---pagebreak---      Dumping
(28) On the basis of the above, the following modified dumping margins expressed
     as a percentage of the CIF import price at the Community border have been
     established for Latvian exporting producers:
           AS "Bolderâja":                          4,7%
          Non cooperating exporting producers:      4,7%
     (e) Lithuania
(29) The Lithuanian exporting producer made no comments following disclosure and
     the publication of the provisional Regulation.
     The dumping margins expressed as a percentage of the CIF import price at the
     Community border established for Lithuanian exporting producers remain
     unchanged, i.e.
           JSC Grigiskes:                           11,4%
           Non cooperating exporting producers:     11,4%
     (f) Poland
     Normal value
     (i)       Profit margin in constructed normal values
(30) The Polish exporting producers made the same claim as the Latvian exporting
     producer with respect to the calculation of the profit margin when constructing
     normal value (see recital (25) above).
     This request has been rejected for the reasons given in recital (25) above.
                                                                                     11
 ---pagebreak---      (ii)      Allocation of selling, general and administrative costs
(31) One Polish exporting producer claimed that the turnover based allocation
     method which the Commission has used to allocate selling, general and
     administrative expenses relating to domestic sales should be revised and instead
     the method normally applied by the company and used in its questionnaire
     response should be utilised. This method was based on sales volumes in tonnes
     to which conversion factors (i.e. the factors used to convert tonnes into m2)
     relating to the thickness of a given hardboard type were applied.
     The request was examined and it was concluded that the allocation method used
     in the questionnaire response is in line with the normal cost accounting practice
     of the company. Consequently, the allocation method for selling, general and
     administrative expenses has been changed in line with the request of the
     company.
     (iii)     Exclusion of specific transactions
(32) One Polish exporting producer questioned the methodology employed by the
      Commission to determine normal value by excluding transactions of low quality
     hardboard. According to this company, the exclusion of these transactions
      causes the artificial overstatement of sales profitability and consequently affects
     their dumping margin.
                                                                                          II
 ---pagebreak---      As stated in recital (27) of the provisional Regulation, it was established that
     only hardboard panels with the same characteristics and the same quality are
     directly comparable. This is so because the quality of the hardboard determines
     to a substantial degree its price and the suitability for certain uses. Therefore,
     and since this low quality hardboard was not exported to the Community, the
     request made by the company could not be accepted
     (iv)      Cost of production
(33) One Polish exporting producer proposed a different way of calculating the costs
     of cutting standard-size hardboard into cut-to-size boards as compared to this
     producer's questionnaire response. This new cost allocation also took into
     account the thickness of the panels cut and not only the number of square
     meters cut. This claim was justified on the grounds that the cutting machines
     can cut simultaneously up to 100mm of panels. Therefore, it was claimed, in
     one cutting operation the company was able to cut a substantially different
     number of square meters depending on the thickness of the panels cut.
     Consequently, the claim was accepted.
     Comparison of Normal Value and Export Price
                                                                                        9>
 ---pagebreak---      (i)       Start-up costs
(34) One Polish exporting producer referred to in recital (65) of the provisional
     Regulation disagreed with the Commission rejection of the start-up cost
     adjustment to its worked hardboard operations. However, as no new evidence
     was submitted by this producer, the findings set out in recital (65) of the
     provisional Regulation are confirmed.
     Dumping
(35) One Polish exporting producer has put into question the methodology used by
     the Commission of calculating a single dumping margin for all hardboard
     product types instead of calculating a different dumping margin for raw
     hardboard and for worked hardboard.
     This claim could not be accepted. It is the constant practice of the Community
     institutions, in accordance with the provisions of Articles 1 and 2 of the basic
     Regulation, to establish a dumping margin for the product under consideration
     as a whole and not per category, type or model of the product concerned. The
     reason is that for a product like hardboard, which exists in a wide variety of
     types, the implementation of anti-dumping measures, in particular anti-dumping
     duties, on a per type basis is from a customs point of view impractical.
(36) On the basis of the above, the following modified dumping margins expressed
     as a percentage of the CIF import price at the Community border duty unpaid
     have been established for Polish exporting producers:
                                                                                      <L\
 ---pagebreak---            EkopfytaS.A.                                                 20,6%
           Zaklady Pryt Pilsniowych S.A w Krosnie Odrzanskim.           11,0%
           Czarna Woda Zaklady Plyt Pilsniowych:                        34,8%
           Alpex Karlino S.A.:                                          22,4%
           Zaklady Pryt Pilsniowych S.A., Przemysl:                      9,1%
           Koniecpolskie Zaklady Pryt Pilsniowych S.A.:                 11,4%
           Non-cooperating exporting producers:                         34,8%
     With regard to Bulgaria, Estonia, Latvia, Lithuania and Poland, it was found
     that the overall level of cooperation was high. As mentioned in recital (35) of
     the provisional Regulation, it was therefore considered appropriate to set the
     dumping margin for the non-cooperating companies in the countries with high
     cooperation at the level of the highest or the sole dumping margin established
     for a cooperating company in the country in question.
     (g) Russia
(37) No Russian exporting producer made any comments following disclosure and
     the publication of the provisional Regulation.
     Normal value for Russia was calculated on the basis of the weighted average of
     the normal values established for co-operating Polish companies.
     The dumping margin for Russia has been recalculated taking into account the
     changes in the normal values established for the Polish companies as described
     in recitals (30) to (33) above.
                                                                                     %f
 ---pagebreak---      On this basis, a new single dumping margin expressed as a percentage of the
     CIF import price at the Community border, duty unpaid, of 30.6% has been
     established for the Russian exporting producers.
                                     D. INJURY
     1. Consumption
(38) The provisional findings are confirmed.
     2. Dumped imports
     (a) Cumulation
(39) The Brazilian exporting producers reiterated the claim that imports into the
     Community from Brazil should not be cumulated with imports from the other
     countries concerned in the proceeding. They argued that hardboard produced in
     Brazil and exported to the Community does not compete with imports
     originating in the other countries concerned in that:
     - the level of its export prices is higher, on average, than the level found for
        the other countries concerned, as shown by the lower provisional
        undercutting margin found at the provisional stage;
     - the volume and market share of imports showed, during the period under
        examination, a divergent trend from mat of the other countries concerned;
                                                                                      l<o
 ---pagebreak---      - it is sold to different customers, mainly producers of lacquered doors.
(40) An examination of these claims resulted in the following findings:
     The quasi totality of the imports from Brazil were destined for particular end
     uses especially the manufacture of lacquered doors, a sector where high prices
     are obtained and to which the other countries concerned do not sell. In fact, the
     users of Brazilian hardboard considered imports from these other sources as
     being wholly unsuitable for their needs, on both technical and economic
     grounds.
     The above findings on end use are supported by Brazilian price levels, which
     are substantially above those of other imports from, the other countries
     concerned. Furthermore, Brazilian import volumes are falling while others are
     rising.
(41) In the light of the above, it is not unreasonable in this case to conclude that a
     cumulative assessment of the imports from Brazil with the effects of imports
     from other sources under investigation would be inappropriate.
     The effects of imports from Brazil were therefore examined separately.
                                                                                       %Y
 ---pagebreak---      (b) Volume and price development of the dumped imports
(42) The provisional findings are confirmed.
     However, in the light of the decision to analyse the effects of imports from
     Brazil separately from the effects of imports from the other countries, the
     analysis of import volumes and price trends is as follows:
          Imports from Brazil:
                            1993       1994        1995         1996        IP
 QUANTITY (tonnes) 62,193             61,605      69,783      58,514
               Indexed          100          99         112          94
  VALUE (000 Ecus)         18,117     17,724      20,767      16,772
               Indexed          100          98         115          93
   % Market share            6.3         5.4        6.0          5.2
               Indexed          100          86          95          82
    Price per tone           291        288         298          287
               Indexed          100          99         102          98
(43) Import volumes and market share show a significant decrease between 1995 and
     the investigation period, while prices remained relatively stable throughout the
     period examined.
                                                                                      %i
 ---pagebreak---          Imports from other countries concerned:
                          1993         1994       1995         1996
QUANTITY (tonnes) 171,890 192,165 253,041 209,727 w&itifi}'-
               Indexed         100         112         147          722
VALUE (000 Ecus)         28,707       33,919     49,103       43,461
               Indexed         100         118          171         151
 % Market share            17.4        16.9        21.7        18.5
               Indexed         100          97         125          107
  Price per tone           167          177        194          207
               Indexed         100         106          116         724
   Import volumes and market shares substantially increased between 1993 and
    1995, fell back in 1996, and increased again in the investigation period. Imports,
   both in absolute value and in terms of market share were higher in me
   investigation period than at the beginning of the period examined.
   Although prices rose significantly over the period considered for the analysis of
    injury, imports from all these countries were still substantially undercutting the
    Community industry's prices in the investigation period.
                                                                                       tf
 ---pagebreak---      (c) Price comparison
(44) Following the disclosure of the provisional findings, comments were made by
     the Brazilian exporting producers relating to the methodology used for the
     calculation of price undercutting.
     It was pointed out that the price differential between the Brazilian export prices
     and Community industry's prices were mainly due to a small part of the
     transactions during the investigation period, accounting for less than 1% of the
     Community production.
     One of the Brazilian exporting producers requested that for the purpose of the
     comparison, where applicable, the price paid by the first independent customer
     in the Community to its related importer be used, as such a price was at the
     same level of trade as prices of the Community industry. Furthermore, it was
     requested that the margins found be expressed as a percentage of the total value
     of imports in the investigation period, including those omitted from the
     comparison where no matching models had been sold by the Community
     producers.
(45) The latter request was not accepted. It is standard practice of the Community
     institutions to use only the O F value of the imports during the investigation
     period for which an actual price-undercutting analysis has been performed and,
     consequently, for which matching Community-made product types existed
     when determining the margins found.
                                                                                        ¥>
 ---pagebreak---  (46) Furthermore, the Product Control Numbers (PCNs) provided by both exporting
/      producers and Community producers were carefully examined and revised
       where necessary to ensure a fair comparison. The comparison was then made at
       the same level of trade between the ex works prices of the Community
       producers and either CIF export prices, Communityfrontierduty paid, when the
       sale was made directly by the exporting producers to an independent customer,
       or the ex-warehouse resale prices of the related importer to the first independent
       customer.
 (47) The undercutting margin was calculated by weighting the type-by-type average
       undercutting rates by the quantities of the dumped imports times the average
       prices of the matching Community-produced products.
       The same criteria were applied to the price comparisons for the other countries
       concerned.
  (48) The export transactions used for the comparison represented at least 74% of
       total exports for each country concerned.
  (49) The revised calculations confirmed the existence of price undercutting for all
       countries except Brazil, for which no price undercutting was found. The new
       levels of price undercutting are shown in the table below:
                                                                                          W
 ---pagebreak---                   SUMMARY OF THE UNDERCUTTING MARGINS
                   Country           Weighted average undercutting on a direct
                                          product type-to-type comparison
            BRAZIL                 "~
            BULGARIA                                     44%
            ESTONIA                                      65%
            LATVIA               .                       48%                   ___
            LITHUANIA                                   45%
            POLAND                                       53%
            RUSSIA                 1                    65%
     3. Situation of the Community industry
(50) The provisionalfindingsare confirmed.
     4. Conclusion on injury
(51) The Polish and Latvian exporting producers questioned the provisional
     conclusions on injury on the grounds that the developments of some injury
     factors, such as production, market share and sales turnover of the Community
     industry were not sufficiently negative to show the existence of material injury.
     These contentions were examined, but could not be accepted. The overall
     analysis at the Community level of all indicators relating to the situation of the
     Community industry, in particular in the light of the substantial deterioration of
     its sales prices and of its increasing financial losses, confirms the existence of
     injury.
                                                                                        31
 ---pagebreak--- (52) Therefore the provisionalfindingson injury are confirmed.
                           E. CAUSATION OF INJURY
     1. Effect of the dumped imports from Brazil
(53) The Brazilian exporting producers claimed that imports originating in Brazil
     could not have caused injury for the following reasons:
     - the quantities imported from Brazil decreased by 20% between 1995 and the
        investigation period;
     - the Brazilian product does not compete with Community production since it
        is sold to specialised users, that is manufacturers of lacquered doors, table
        mats and the automotive industry which need Brazilian eucalyptus hardboard
        for their particular quality requirements, and cannot replace it, in spite of its
        higher prices, with other hardboard types;
     - Brazilian exports do not undercut the Community industry's sales,
        particularly in the above-mentioned specialised sectors.
(54) As to the first claim, the decrease in the quantities imported does not preclude
     that injury has been caused in the investigation period by those imports; indeed,
     the imports were still substantial and well above the de minimis limit as
     provided in Article 5(7) of the basic Regulation.
                                                                                          3^>
 ---pagebreak--- (55) As to the other claims, it was found that:
     - around 68% of the imports from Brazil during the investigation period were
        destined for production in the Community of lacquered doors. The
       Community lacquered door industry has stringent quality requirements for
       which Brazilian eucalyptus hardboard is particularly well-suited. However,
       as pointed out at recital (18) above, the high quality required by the door
       manufacturers is not strictly linked to the species of wood used, in this case
       eucalyptus.     Brazilian hardboard      is well-suited  to  lacquered    door
       manufacture, not only because it is made with eucalyptus wood, but also
       because the Brazilian producers carry out very severe quality controls on
       their exports to the Community;
     - in the investigation period only very small quantities of hardboard produced
        by the Community industry were used for the manufacture of lacquered
        doors; the demand was almost completely satisfied by eucalyptus hardboard
        either imported from Brazil or supplied by the Portuguese non-complainant
        producer. The door manufacturers explained their choice on the grounds of
        the high quality guaranteed by those suppliers;
                                                                                      iH
 ---pagebreak---      - the above argument on the special end-uses is supported by the fact that there
        is no undercutting by Brazilian exports destined for the manufacture of door-
        skins; in fact their prices are significantly above those of the Community
        industry;
     - the evidence, therefore, does not support the Community producers' claim
        that market prices were depressed by Brazilian exports, and that it is price
        depression which prevents them from producing doorskins of a quality equal
        to that of the Brazilian product and suitable for the production of lacquered
        doors;
     - as to the imports from Brazil not sold to the lacquered doors segment, they
        did not undercut, on average, the prices of Community production.
(56) The foregoing leads to the conclusion that Brazilian exports were not a cause of
     material injury to the Community industry, and that, as a consequence, the
     proceeding with respect to Brazil should be terminated without measures.
                                                                                      3*
 ---pagebreak---      2. Effect of the dumped imports from the other countries subject to
        investigation
(57) The volume of imports from the other countries subject to investigation
     increased by 29% between 1993 and the investigation period. Although their
     prices increased, on. average, by 32% over the same period, they still undercut
     substantially the prices of the Community industry in the investigation period.
     As a result of this undercutting, which ranged from 44% to 67%, the
     Community industry experienced a 16% fall in its selling prices and a serious
     deterioration of its financial situation.
     The provisional findings that the dumped imports from Bulgaria, Estonia,
     Latvia, Lithuania, Poland and Russia caused material injury to the Community
     industry are therefore confirmed.
     3. Effect of imports from other third countries
(58) Although certain exporting producers in the countries concerned reiterated
     claims that injury had been caused by the increase of imports from other third
     countries, no new information was made available in this respect which could
     alter the provisional findings.
     The provisionalfindingsare therefore confirmed.
                                                                                     36
 ---pagebreak---      4. Competition from non-complainant Community producers
(59) Some of the exporting producers concerned drew attention to the fact that,
     although not undercutting the Community industry's prices in the investigation
     period, non-complainant Community producers had been undercutting, on
     average, the Community industry's prices from 1993 to 1995, and that this may
     have been, in those years, a cause of injury.
(60) It should be noted that, although lower than those of the Community industry,
     non-complainant producers' prices were substantially higher than the average
     prices of imports from the countries concerned with the exception of Brazil: the
     average price of these imports %was 167 Ecus per tonne in 1993, while the
     average unit price for non-complainant producers was 1.02 Ecu per m2,
     corresponding to more than 300 Ecus per tonne.
(61) In the light of these price relationships, it is considered unlikely that the pricing
     of non-complainant producers was a source of injury to the Community
     industry; in any event, such pricing effect was considered insufficient to break
     the causal link between the dumped imports from the six countries and the
     injury suffered.
     5. Effect of dry-process fibreboards
(62) After the imposition of provisional measures, various exporting producers again
     argued that the injury suffered by the Community industry was not caused by
     the dumped imports, but by the competition from the thin dry-process
     fibreboards.
                                                                                           n
 ---pagebreak--- (63) The investigation has shown that thin dry-process fibreboard could be used in
     most areas where hardboard is employed. Nevertheless, despite the strong
     growth in the dry-process fibreboard market in recent years, as shown by the
     growth in consumption for hardboard, this has not occurred at the expense of
     the hardboard sector.
(64) Various interested parties have submitted estimates of the size of the thin dry-
     process fibreboards sector. On the basis of statistics provided by the European
     MDF industry, the volume of production of thin dry-process fibreboards is
     estimated at between 500,000 and 600,000 m3 in 1997, with an increase of
     around 50% between 1993 and 1997. Separate statistics on imports of thin dry-
     process fibreboards are not available, but imports of dry-process fibreboards of
     all thicknesses were reported to be minor until 1997.
(65) However, at the provisional stage it was shown that, since consumption of
     hardboard increased by 20% between 1993 and the investigation period (it
     should be recalled that consumption was around 1,2 million tonnes in the
     investigation period, despite the rise of the thin dry-process fibreboards sector),
     it was unlikely that the increase in the demand of thin dry-process fibreboards
     was a major cause of injury. The injury to the Community industry did not
     consist of a loss in sales volumes, which might indicate that a substitution had
     occurred. Injury was mainly shown by financial losses, due to a strong
     downward pressure on prices exerted by the dumped imports.
                                                                                         #
 ---pagebreak--- (66) Indeed the data available show that the average price of thin dry-process
     fibreboards was above that of Community produced hardboard of equivalent
     thickness for all of the period 1993 to 1996. Only during the investigation
     period is there some indication that one type of thin dry-process fibreboard,
     namely thin MDF, may have reached the price level of Community produced
     hardboard in parts of the Community. So even in this scenario, hardboard
     imported from the countries concerned during the investigation period was sold
     at significantly lower prices as outlined in recital (49).
(67) Given the interchangeability between all types of wood-based products, thin
     dry-process fibreboards have established a presence on all markets for wood-
     based panels, including the hardboard market. However, the general increase in
     the demand for wood panels, and of fibreboards in particular, has allowed the
     demand for hardboard to grow in spite of the presence of the competing
     products.
(68) No new information has been made available which changes the provisional
     finding that, despite the growth in demand for thin dr^-process fibreboards, the
     dumped imports of hardboard from the countries subject to investigation, with
     the exception of Brazil, in isolation caused material injury to the Community
     industry, in terms of price depression and financial losses.
     6. Conclusion on causation
(69) In the light of the foregoing, the provisional findings on causation are
     confirmed, with the exception of those relating to imports from Brazil.
                                                                                      tf
 ---pagebreak---                          F. COMMUNITY INTEREST
     1. The definitive investigation
(70) Following the imposition of provisional measures, the analysis of the impact of
 ^   anti-dumping measures on the various sectors involved in the investigation
     continued. Users of hardboard were visited, as indicated in recital (3) above, as
     well as a non-complainant Community producer of eucalyptus hardboard.
     2. Impact on the Community industry
(71) Subsequent to the imposition of provisional measures, several arguments were
     presented on the likely impact of any definitive measures on the Community
     industry.
     These arguments concerned the relationship between hardboard and thin dry-
     prpcessfibreboards,as follows.
     (a) Arguments presented by interested parties
(72) It was claimed by certain interested parties that the Community industry could
     not benefit from any anti-dumping measures as a result of the substitutability
     between thin dry-processfibreboardsand hardboard.
                                                                                       Ho
 ---pagebreak---      In support of this view, it was alleged that the price level of thin dry-process
     fibreboards has reached the level of hardboard of equivalent thickness.
     According to these claims, the imposition of anti-dumping measures, with the
     intention of increasing the price of hardboard in the Community, would have the
     effect of raising its price above that of competing thin dry-process fibreboards.
     Where the two products are interchangeable, the effect of the anti-dumping
     measures would be that customers will choose to use thin dry-process
     fibreboards instead of hardboard. In other words, the anti-dumping measures
     would merely serve to reduce the consumption of hardboard by encouraging a
     switch to the consumption of thin dry-process fibreboards.
(73) It was also claimed that thin dry-process fibreboards are a product in rising
     demand, with an increasing investment in production capacity and with the
     potential to replace hardboard in most end uses if a change in relative prices
     occurs.
     (b) The size of the thin dry-process fibreboards sector
(74) As mentioned in recital (64), production of thin dry-process fibreboards was
     between 500,000 and 600,000 m3 in 1997, with a growth of around 50%
     between 1993 and 1997. However, the plants specialised in the production of
     these thin boards (that is, those equipped with the so-called 'calander press') are
     currently operating at near-full capacity, and most of the new investments in the
     sector of dry-process fibreboards relate to plants which are best employed in the
     production of 'middle' thicknesses, that is, between 6 and 30mm, which are
     outside the scope of this investigation.
                                                                                         H1
 ---pagebreak---      In the short run, therefore, an increase in output of thin dry-process fibreboards
     is unlikely.
     (c) The competition between hardboard and thin dry-process fibreboards
(75) As explained in recitals (5) to (9), hardboard and dry-process fibreboards are
     theoretically interchangeable in many end uses, but their different physical
     characteristics imply that each has its specific advantages and disadvantages for
     any particular end use.
(76) The exporting producers claimed that if there is a sufficient change in the
     relative prices of the two competing products, the extra costs incurred by any
     technical problems associated with switching to the use of thin dry-process
     fibreboards can be overcome if the price advantage in comparison with
     hardboard becomes large enough.
(77) The Community industry claimed, however, that the substitution of hardboard
     with dry-process fibreboards has already taken place in those end uses where
     they have a technical advantage, and that at present the competitive situation on
     the market has found an equilibrium, which is not going to be substantially
     altered by the proposed anti-dumping measures. Since consumption of
     hardboard continued to rise by 20% over the period examined, the data suggests
     that hardboard has been able to compete effectively with thin dry-process
     fibreboards, lending weight to the arguments submitted by the Community
     industry. Continual technical progress in the manufacture of thin dry-process
     fibreboards, however, makes it difficult to assess the degree to which thin dry-
     process fibreboards might be used in fields hitherto dominated by hardboard in
     the future.
                                                                                        \j{ 2-
 ---pagebreak--- (78) Thin dry-process fibreboards have been priced above hardboard of equivalent
     thickness for most of the period examined, but as technological progress has
     brought about cost reductions, their prices have declined steadily throughout the
     period, reaching approximately the levels of Community-produced hardboard of
     equivalent thickness by 1997. *
     It is unclear whether this trend decrease in the price of thin dry-process
     fibreboards, as technological progress leads to continued cost-reductions, is set
     to continue into the near future. The complainant states that further substantial
     reductions in the prices of thin dry-process fibreboards in the Community are
     not to be expected. The product is, it is claimed, now beyond the phase of rapid
     growth experienced in the last few years, which led to declining unit costs, and
     the mills are approaching full capacity utilisation, with a cost structure which is
     similar to that of hardboard. Therefore, the price of thin dry-process fibreboards
     is expected to remain, if definitive anti-dumping measures are imposed, on the
     same level as the price of Community produced hardboard.
(79) On the other hand, the continuous-line and calander-press production processes
     which are used to manufacture thin dry-process fibreboards are said by the dry-
     processed fibreboard industry to be more efficient than the multi-daylight
     presses used in the production of hardboard. In particular, the levels of waste
     and offcuts from these MDF production processes are allegedly far lower than
     with multi-daylight presses, whilst the speed of manufacture is greater. Thus, it
     is claimed that the prices of Community-produced thin dry-process fibreboards
     can continue their declining trend. The same prediction is made by some of the
     interested parties concerning the price trend of imports of thin dry-process
     fibreboards from outside of the Community.
                                                                                         M2>
 ---pagebreak---      These developments have implications for the use of hardboard in those sectors
     where its end-uses overlap with those of dry-processfibreboards,such as in the
     furniture industry. If prices of dry-process fibreboards continue to decline after
     the imposition of definitive anti-dumping measures, it is possible that a switch
     in consumption away from hardboard in favour of thin dry-process fibreboards
     could follow in those market segments where dry-process fibreboards are
     interchangeable with hardboard.
     (d) Conclusion on the impact of measures on the Community industry
(80) In view of the above analysis, it was found that the measures proposed will most
     likely have a beneficial impact on the situation of the Community industry. In
     case anti-dumping measures are not imposed, the dumped imports will continue
     undercutting substantially the Community industry's prices. Given the financial
     difficulties highlighted by the injury analysis, the continuation of the business
     activity of the Community industry would be seriously threatened and a large
     part of Community production of hardboard, which guarantees at present the
     coverage of a wide range of customers' demands, would be put at risk, forcing
     users to choose among less than optimal alternatives, such as the dumped
     imports and other wood panel products.
     It should also be borne in mind that, although it is possible that some of the
     benefits of anti-dumping measures may accrue to industries other than the
     hardboard industry, it is highly unlikely that the Community industry would
     have sought protection against unfair trade had it not expected benefits from
     measures.
                                                                                        4^1
 ---pagebreak---      The effectiveness of the measures, however, may be reduced depending on the
     future price relationship between hardboard and the dry-process fibreboards,
     and a review under Article 11(3) of the basic Regulation may be justified should
     developments in this context warrant such a review.
     3. Impact on upstream industries
(81) As no further representations were received, the provisional findings are
     confirmed.
     4. Impact on importers
(82) In the absence of further representations, the provisionalfindingsare confirmed.
     5. Impact on users
(83) All the users co-operating during the investigation were manufacturers of doors
     using only hardboard imported from Brazil. It was found that imports from
     Brazil have not caused injury to the Community industry and that no measures
     should be adopted in respect of that country.
     The impact oil other users is expected to be minor, given the rates of duty
     proposed and the small share of hardboard in the cost of production of most of
     such users.
                                                                                       r
                                                                                      Mi
 ---pagebreak---        6. Conclusion on Community interest
(84) In the light of the foregoing, it is concluded that there is no reason to consider
       that the imposition of definitive anti-dumping measures on imports of hardboard
       originating in the countries for whom definitive measures are to be adopted
       would be against the overall interest of the Community.
                                  G. MEASURES PROPOSED
       1. Termination of the proceeding in respect of Brazil
(85) Based on the conclusions of the definitive investigation, the proceeding
       concerning imports originating in Brazil is terminated by Commission Decision
       ... ? without the imposition of measures. The amounts secured by way of a
       provisional anti-dumping duty shall therefore be released. The undertakings
       provisionally accepted from the two exporting producers in Brazil will
       automatically lapse in accordance with Article 8(6) of the basic Regulation.
       2. Definitive measures
       (a) Injury elimination level
(86) The injury elimination level was calculated using the same methodology as
       described in the provisional Regulation at recital (113) with a level of trade
       adjustment to reflect sales made via traders.
3
  See page     of this Official Journal.
                                                                                        1/&
 ---pagebreak--- (87) An injury margin was established for each of the exporting producers concerned
     as a result of these comparisons and this margin was expressed as a percentage
     of the CIF value of their exports to the Community for product types for which
     there were Community-made matches.
     (b) Form and level of the definitive measures
(88) Based on the above conclusions on dumping, injury, causal link and Community
     interest, it was considered what form and level of anti-dumping measures would
     have to be taken in order to remove the trade-distorting effects of injurious
     dumping and to restore effective competitive conditions on the Community
     market.
     Definitive measures should take the form of ad-valorem duties, which are
     deemed appropriate to remove the injury caused by the dumped imports.
     In accordance with Article 9(4) of the basic Regulation, as the injury margin
     was lower than the dumping margin found for one of the co-operating Polish
     exporting producers, the definitive anti-dumping duty for that company is set at
     the level of the former. For all other exporting producers, the injury margins are
     higher than the corresponding dumping margins and measures are therefore
     based on the latter margins. The same applies for the residual duties.
                                                                                        wr
 ---pagebreak---        (c) Undertakings
(89) It will be recalled from recital (115) et seq. of the provisional Regulation that
       undertakings had been offered by the co-operating exporting producers in
       Brazil, Bulgaria, Estonia, Latvia, Lithuania and Poland, and provisionally
       accepted by the Commission.
       These undertakings, with the exception of those offered by the Brazilian
       companies, reflect the definitivefindingsof the investigation with respect to the
       minimum prices provided therein and have. been definitively accepted by
       Commission Decision              «.
       3. Collection of the provisional duties
(90) In the light of the seriousness of the injury suffered by the Community industry,
       it is considered necessary that the amounts secured by way of the provisional
       anti-dumping duty under Regulation (EC) No 1742/98 should be definitively
       collected to the extent of the amount of the definitive duties levied,
4
  See page     of this Official Journal
                                                                                         Ul>
 ---pagebreak--- HAS ADOPTED THIS REGULATION:
                                       Article 1
1. A definitive anti-dumping duty is hereby imposed on imports of hardboard,
   defined as wet-processed fibreboard of wood or other ligneous materials, whether
   or not bonded with resins or other organic substances and with a density exceeding
   0,8 g/cm3, falling under CN codes ex 4411 11 00 and ex 4411 19 00 (TARIC
   codes: 4411 11 00* 10 and 4411 19 00* 10) originating in Bulgaria, Estonia, Latvia,
   Lithuania, Poland and Russia.
2. The rate of the definitive anti-dumping duty applicable to the net free-at-
   Community -frontier price to the products manufactured by the companies listed
   below shall be as follows:
    Country                 Company            Rate of duty Taric additional
                                                   (%)               code
Bulgaria          Fazerles AD                       7.1                    8461
                  All other companies               7.2                    8900
Estonia           All companies                     6.0                        -
Latvia            All companies                     4.7                        -
Lithuania         All companies                    11.4                        -
Poland            Alpex-Karlino S.A.               22.4                    8479
                  Ekopryta S.A.                     7.0                    8480
                  Zaklady Pryt Pilsniowych          9.1                    8481
                  S.A., Przemysl
                  Koniecpolskie Zaklady Pryt       11.4                    8494
                  Pilsniowych S.A
                  Zaklady Pryt Pilsniowych         11.0                    8495
                  S.A w Krosnie Odrzanskim
                  All other companies              34.8                    8900
Russia            All companies                    30.6                        -
                                                                                       uf
 ---pagebreak---                                         Article 2
1. Notwithstanding Article 1, the definitive duty shall not apply to imports of
   hardboard produced and directly exported and invoiced to an importing company
   in the Community by the companies listed in paragraph 3, provided that the
   conditions of paragraph 2 are met.
2. When the declaration for release for free circulation is presented, exemption from
   the duty shall be conditional upon presentation to the competent Member State's
   customs services of a valid Undertaking Invoice issued by one of the companies
   listed in paragraph 3. The Undertaking Invoice, the essential elements of which are
   listed in the Annex, shall conform to the requirements for such invoices set out in
                                                           5
   the undertaking accepted by Commission Decision
3. Imports accompanied by an Undertaking Invoice shall be declared under the
   following Taric additional codes:
5
  See page     of this Official Journal
                                                                                       io
 ---pagebreak---     Country                  Company                Taric Additional
                                                          Code
Bulgaria           FazerlesAD                                    8496
                   Lessoplast AD                                 8497
Estonia            AS Repo Vabrikud                              8498
Latvia           - AS "Bolderaja"                                8499
Lithuania          JSC Grigiskes                                 8510
Poland             Alpex-Karlino S.A.                            8511
                   Czarna Woda Zaklady Pryt                      8600
                   Pilsniowych
                   EkoplytaS.A.        .                         8513
                   Zaklady Pryt Pilsniowych                      8545
                   S.A., Przemysl
                   Koniecpolskie Zaklady Pryt                    8546
                   Pilsniowych S.A
                   Zaklady Pryt Pilsniowych S.A                  8547
                   w Krosnie Odrzanskim
                                         Article 3
1. The amount provisionally secured by Regulation (EC) No 1742/98 with respect to
   imports originating in the countries mentioned in Article 1 shall be definitively
   collected to the extent of the amount of the definitive duties levied.
2. The amounts provisionally secured by Regulation (EC) No 1742/98 with respect to
   imports originating in Brazil shall be released.
                                                                                     51
 ---pagebreak---                                         Article 4
This Regulation shall enter into force on the day of its publication in the Official
Journal of the European Communities.
This Regulation shall be binding in its entirety and directly applicable in all Member
States.
Done at Brussels,
                                                              For the Council
 ---pagebreak---                                               ANNEX
Elements to be indicated in an Undertaking Invoice referred to in Article 2(2):
1. the Product Reporting Code (as established in the undertaking offered by the
   producing exporter in question);
2. The exact description of the goods, including:
•  The Company Product Code (CPC); whether the hardboard is unworked or
   worked; the thickness and the precise measures of the panel, indicating in brackets
   whether it has standard measures (STA) or cut-to-size ones (CTS);
•  CNCode;
•  the TARIC additional code under which the goods on the invoice may be customs
   cleared at Community borders (as specified in the Regulation);
•  quantity (to be given in m2);
3. The description of the terms of the sale, including:
•  Price per square meter1 ;
•  the applicable payment terms;
•  the applicable delivery terms;
•  total discounts and rebates;
4. Name of the importer to which the invoice is issued directly by the Company.
5. The name of the official of the Company that has issued the Undertaking Invoice
   and the following signed declaration:
1
   For Undertaking invoices issued by the Latvian exporting producer AS "Bolderâja", in case of
   sales via sales agents established in the Community the price per m2 may appear on an additional
   invoice issued by the agent instead of on the Undertaking invoice issued by AS "Bolderâja". If that
   is the case, the Undertaking invoice should also mention the name of the agent.
                                                                                                       ii>
 ---pagebreak---          "I, the undersigned, certify that the sale for direct export to the European
          Community of the goods covered by this invoice is being made within the
          scope and under the terms of the undertaking offered by «Company», and
                                                                            2
         accepted by the European Commission through Decision (EC)             I declare
         that the information provided in this invoice is complete and correct."
2
  See page .... of this Official Journal.
                                                                                         ^
 ---pagebreak---  ---pagebreak---  ---pagebreak---  ---pagebreak---                                                                 ISSN 0254-1475
                                                           COM(98) 805 final
                                              DOCUMENTS
EN                                                           02 11 06 01
                                    Catalogue number : CB-CO-98-813-EN-C
Office for Official Publications of the European Communities
L-2985 Luxembourg