CELEX: 62015CC0248
Language: en
Date: 2016-09-22 00:00:00
Title: Opinion of Advocate General Mengozzi delivered on 22 September 2016.

OPINION OF ADVOCATE GENERAL
MENGOZI
delivered on 22 September 2016 (1)

Joined Cases C‑248/15 P, C‑254/15 P and C‑260/15 P

Maxcom Ltd (C‑248/15 P)

European Commission (C‑254/15 P)

Council of the European Union (C‑260/15 P)

v

City Cycle Industries

(Appeal — Commercial policy — Dumping — Implementing Regulation (EU) No 501/2013 — Imports of bicycles consigned from, in particular, Sri Lanka — Extension to those imports of the definitive anti-dumping duty imposed on imports of bicycles originating in the People’s Republic of China — Regulation (EC) No 1225/2009 — Articles 13 and 18 — Circumvention — Failure to cooperate on the part of some of the producers/exporters covered in the investigation — Proof of circumvention — Body of consistent evidence — Failure to state reasons)
This Opinion concerns three appeals whereby Maxcom Ltd, the European Commission and the Council of the European Union ask the Court to set aside the judgment of the General Court of the European Union of 19 March 201
5 in 

1.        CityCycle Industries v Council (2) (‘the judgment under appeal’), whereby the General Court annulled Article 1(1) and (3) of Council Implementing Regulation (EU) No 501/2013 (3) (‘the regulation at issue’), in so far as it concerns City Cycle Industries (‘City Cycle’), the applicant before the General Court.

2.        This Opinion is being delivered in parallel with my Opinion in Cases C‑247/15 P, Maxcom v Chin Haur Indonesia, C‑253/15, Commission v Chin Haur Indonesia and C‑259/15 P, Council v Chin Haur Indonesia (‘the Opinion in the Chin Haur cases’), which relates to three appeals brought by the same appellants against the judgment of the General Court in Chin Haur Indonsia v Council(4) delivered on the same day as the judgment under appeal and concerns the same regulation at issue. The questions raised in those three appeals are similar to those raised in these cases. (5)

3.        In essence, all of these cases provide the Court with the opportunity to clarify the requirements relating to the proof which the Commission and the Council (together ‘the institutions’) must adduce in order to establish the existence of circumvention, within the meaning of Article 13 of Council Regulation (EC) No 1225/2009 (‘the basic regulation’), (6) in a situation characterised by non-cooperation on the part of some of the producers/exporters involved in the anti-circumvention investigation.
I –  Legal framework

4.        For a detailed description of the legal framework, reference is made to points 5 to 10 of my Opinion in the Chin Haur cases. For the purposes of these proceedings, I shall merely point out that Article 13 of the basic regulation allows the institutions, on certain conditions, to extend the anti-dumping duties which they have imposed on imports of products from a third country to imports of like products from, in particular, another third country in order to avoid circumvention of the original anti-dumping measures.

5.        It is apparent from the definition of ‘circumvention’ in the third sentence of Article 13(1) of the basic regulation that, in order for the existence of circumvention to be established, four conditions must be satisfied: (i) there must be a change in the pattern of trade between third countries and the European Union; (ii) that change must be the result of a practice, process or work for which there is insufficient due cause or economic justification other than the imposition of the duty; (iii) there must be evidence of injury; and (iv) there must be evidence of dumping. In the present case, only the second of those components of circumvention is in dispute. (7)

6.        Next, it should also be observed that, under Article 13(4) of the basic regulation, a producer/exporter of the original product concerned from the country involved in the anti-circumvention investigation may be granted an individual exemption from the anti-circumvention duties imposed if he has submitted, within a prescribed time limit, a request for exemption, duly supported by evidence, and — where the circumventing practices take place outside the European Union — where two conditions are fulfilled: first, if he is able to show that he is not related to any producer subject to the measures; and, second, if it has been found that that producer does not engage in circumventing practices.

7.        Last, under Articles 18(1) and (6) of the basic regulation, entitled ‘Non-cooperation’, ‘in cases in which any interested party refuses access to, or otherwise does not provide, necessary information within the time limits provided … or significantly impedes the investigation, provisional or final findings, affirmative or negative, may be made on the basis of the facts available’ and ‘if an interested party does not cooperate, or cooperates only partially, so that relevant information is thereby withheld, the result may be less favourable to the party than if it had cooperated’.
II –  Background to the disputes and regulation at issue

8.        The background to the disputes is set out in paragraphs 1 to 28 of the judgment under appeal, to which reference is made. For the purposes of these proceedings, I shall merely observe that in 2012 the Commission, by a regulation, (8) initiated an investigation concerning the possible circumvention of the anti-dumping measures imposed by Regulation No 990/2011 (9) by imports of bicycles consigned from, in particular, .

9.        In the context of that investigation, City Cycle submitted an exemption request under Article 13(4) of the basic regulation. The Commission carried out a verification visit at City Cycle’s premises in , and eventually rejected its exemption request. (10)

10.      On 29 May 2013, the Council adopted the regulation at issue.

11.      In that regulation, in recitals 35 to 42, the Council first of all stated that six Sri Lankan companies, representing 69% of the total imports from  into the European Union during the reporting period, had submitted a request for exemption in accordance with Article 13(4) of the basic regulation. One of those companies had ceased production of bicycles in  and withdrew its exemption request. Two other companies, including City Cycle, did not cooperate in a satisfactory manner. Consequently, the data which they submitted were not taken into consideration and the conclusions in respect of those companies were based on the facts available, in accordance with Article 18 of the basic regulation.

12.      Next, the Council stated that all the conditions for the finding of circumvention pursuant to Article 13(1) of the basic regulation were satisfied. (11)

13.      As regards, specifically, the circumventing practices in , the Council examined, first of all, the existence of transhipment operations. In that regard, recitals 77 to 79 of the regulation at issue state:
‘(77)      The exports of the initially cooperating Sri Lankan companies amounted to 69% of the total Sri Lankan exports to the Union in the [reference period] For three out of the six initially cooperating companies, the investigation did not reveal any transhipment practices. For the remaining exports there was no cooperation as explained in recitals 35 to 42.
(78)      Therefore, in light of the change in the pattern of trade concluded in recital 58 between Sri Lanka and the Union within the meaning of Article 13(1) of the basic Regulation and the fact that not all Sri Lankan producers/exporters came forward and/or cooperated it can be concluded that the exports of those producers/exporters can be attributed to transhipment practices.
(79)      The existence of transhipment of Chinese-origin products via Sri Lanka is therefore confirmed.’

14.      Subsequently, the Council stated that the existence of assembly operations, within the meaning of Article 13(2) of the basic regulation, had not been established in . (12)

15.      In those circumstances, the Council concluded that there had been circumvention in the form of transhipment operations via Sri Lanka and extended the definitive anti-dumping duty laid down in Implementing Regulation No 990/2011 to imports of bicycles consigned from Sri Lanka (13) and, furthermore, it refused to grant the exemption, pursuant to Article 13(4) of the basic regulation, to the two companies, including City Cycle, which had not cooperated. (14)
III –  Procedure before the General Court and judgment under appeal

16.      On 9 August 2013, City Cycle brought an action before the General Court, seeking annulment of Article 1(1) and (3) of the of the regulation at issue.

17.      On 8 October 2013, the General Court allowed City Cycle’s request that the case be decided under an expedited procedure. (15)

18.      By order of 11 November 2013, the President of the Seventh Chamber of the General Court granted the Commission leave to intervene in support of the form of order sought by the Council. However, the Commission was not allowed to lodge a statement in intervention. (16) On 25 June 2014, as the case was subject to the expedited procedure, the Commission submitted a request for leave, by way of a measure of organisation of procedure, to lodge a statement in intervention. (17) That request was rejected by the General Court.

19.      Maxcom was granted leave to intervene by order of 16 July 2014.

20.      In support of its action, City Cycle put forward five pleas in law. In particular, the first plea alleged infringement of Articles 13(1) and 18(1) of the basic regulation. By the first part of that plea, City Cycle disputed the Council’s conclusion that there had been a change in the pattern of trade. By the second part of that plea, City Cycle challenged the Council’s conclusion, notably in recital 78 of the regulation at issue, that City Cycle had engaged in transhipment operations. (18)

21.      At the hearing, the Commission claimed that the action was inadmissible in its entirety, on the ground that City Cycle was not a Sri/Lankan producer/exporter, but merely a type of local service provider acting on behalf of a Chinese undertaking.

22.      By the judgment under appeal, the General Court rejected the first part of the first plea and all the other pleas as unfounded. On the other hand, it upheld the second part of the first plea, in particular the first claim, alleging an error of assessment vitiating recital 78 of the regulation at issue.

23.      In that regard, the General Court analysed, in the first place, in paragraphs 82 to 97 of the judgment under appeal, the evidence communicated by City Cycle during the investigation. Following that analysis, the General Court concluded that that evidence did not show that City Cycle was indeed an exporter of Sri Lankan origin or that it met the criteria laid down in Article 13(2) of the basic regulation.

24.      In the second place, in paragraph 98 of the judgment under appeal, the General Court held that, nonetheless, the Council had no evidence from which it could expressly conclude, in recital 78 of the regulation at issue, that City Cycle was involved in transhipment operations.

25.      In the third place, in paragraph 99 of the judgment under appeal, the General Court considered that, admittedly, it could not be ruled out that the practices, processes or work for which there was insufficient due cause or economic justification other than the imposition of the initial anti-dumping duty, within the meaning of the second subparagraph of Article 13(1) of the basic regulation, included City Cycle’s engagement in transhipment operations. However, according to the General Court, the fact that City Cycle was unable to show that it was indeed a Sri Lankan producer or that it satisfied Article 13(2) of the basic regulation did not enable the Council to conclude by default that City Cycle was engaged in transhipment, such a power being apparent neither from the basic regulation nor from the case-law.

26.      The General Court therefore found that the first claim in the second part of the first plea must be upheld and that there was no need to deal with the other three claims put forward by City Cycle in the second part of that plea. Consequently, the General Court annulled Article 1(1) and (3) of the regulation at issue. (19)
IV –  Forms of order sought

27.      By their appeals, Maxcom, the Commission and the Council claim that the Court should set aside the judgment under appeal, dismiss the action at first instance and order City Cycle to pay the costs. In the alternative, the Commission and the Council ask the Court to refer the case back to the General Court for reconsideration and to reserve the costs of both sets of proceedings.

28.      City Cycle contends that the Court should dismiss the appeals against the judgment under appeal in their entirety and order Maxcom, the Commission and the Council to pay the costs. In the alternative, in the event that the Court should set aside the judgment under appeal, City Cycle asks the Court to adjudicate on its action at first instance, to uphold the three remaining claims in the second part of the first plea which it raised before the General Court and to annul in part Article 1(1) and (3) of the regulation in so far as those provisions extend the anti-dumping duty imposed on imports of bicycles originating in China and reject its exemption request.
V –  Assessment

29.      Maxcom puts forward two grounds of appeal against the judgment under appeal, the first by way of principal claim and the second in the alternative, the Commission puts forward four grounds of appeal and the Council puts forward two. The grounds of appeal put forward in the three appeals overlap to a large extent and may, in essence, be placed in four groups.

30.      First, the Commission claims that the General Court erred in law by refusing to assess of its own motion the inadmissibility of City Cycle’s action. (20) Second, Maxcom, the Commission and the Council claim that the General Court made various errors of law in the application of Article 13(1) of the basic regulation. (21) Third, the Commission and the Council claim that the judgment under appeal is vitiated by a failure to state reasons and contradictory reasoning; in the same context, the Council also claims that the General Court distorted the facts. (22) Fourth, the Commission maintains that the General Court breached its procedural rights. (23)

31.      The Commission’s fourth ground of appeal, alleging breach of its procedural rights, is identical, both factually and legally, to the third ground of appeal which it has put forward in Case C‑253/15 P, Commission v Chin Haur Indonesia the Opinion in which is being delivered at the same time as the Opinion in the present cases. In those circumstances, for an account of the Commission’s arguments and the reasons why I consider that this ground of appeal must be rejected, reference is made to points 102 to 111 of the Opinion in the Chin Haur cases.

A –    First ground of appeal put forward by the Commission in Case C‑254/15 P, alleging an error in that the General Court did not examine of its own motion the admissibility of City Cycle’s action

1.      Arguments of the parties

32.      The Commission disputes the analysis set out in paragraphs 42 to 44 of the judgment under appeal, whereby the General Court rejected the plea of inadmissibility raised by the Commission at the hearing against City Cycle’s action. In particular, the Commission claims that the General Court erred in law by refusing to assess of its own motion the admissibility of that action.

33.      First, in the Commission’s submission, the General Court’s decision not to examine the admissibility of the action runs counter to the case-law of the Court of Justice, which has held that inadmissibility must be raised of their own motion by the Courts of the European Union. Second, the fact that the Commission was able to raise a plea of inadmissibility only at the hearing is the consequence of the General Court’s decision not to allow it to lodge a statement in intervention. Third, the Commission claims that the file contained sufficient evidence to establish that there were serious doubts, and not just conjecture, about the admissibility of City Cycle’s action. The General Court itself found, moreover, that City Cycle had not shown that it was a producer or exporter of bicycles.

34.      City Cycle disputes the Commission’s arguments.
2.      Assessment

35.      In paragraphs 41 to 45 of the judgment under appeal, the General Court rejected the plea of inadmissibility raised by the Commission at the hearing. The General Court first of all observed that, since the Council had not raised a plea of inadmissibility, the Commission, as an intervener, did not, according to the case-law, have locus standi to raise such a plea. Next, the General Court found that, in any event, at the hearing the Commission had merely given voice to conjecture, at a particularly late stage of the judicial proceedings, without adducing any new evidence in support of its claim that the action was inadmissible.

36.      In that regard, it should be observed that it is settled case-law that an intervener has no standing to raise a plea of inadmissibility not set out in the form of order sought by the defendant (24) and that the Courts of the European Union are therefore not required to examine such a plea.

37.      However, the inadmissibility of an action for annulment resulting from the applicant’s lack of locus standi constitutes a ground involving a question of public policy (25) which, as such, must be raised of its own motion by the relevant Court of the European Union. (26)

38.      In the present case, it must be stated that, contrary to the Commission’s assertion, the General Court did indeed examine the admissibility of the action in the light of the arguments which the Commission put forward at the hearing. In paragraph 44 of the judgment under appeal, the General Court concluded that those arguments, concerning the relationship between City Cycle and the Chinese undertaking to which the Commission referred, were not substantiated by new evidence that might have cast doubt on the admissibility of City Cycle’s action.

39.      In any event, as City Cycle emphasises, that undertaking participated in the anti-circumvention investigation in question, it is individually mentioned in the regulation at issue as an exporter of bicycles originating in  to the European Union and it was individually refused the benefit of cooperation and exemption from duties in the implementing regulation. In those circumstances, I consider that the fact that the regulation at issue is of direct and individual concern to it cannot be called in question. (27)

40.      It follows that the Commission cannot claim that the General Court erred in rejecting the plea of inadmissibility which it raised at the hearing. Consequently, in my view the Commission’s first ground of appeal in Case C‑254/15 P must be rejected.

B –    The grounds of appeal alleging incorrect application of Article 13(1) of the basic regulation

1.      Arguments of the parties

41.      Maxcom, the Commission and the Council maintain that the reasoning set out in paragraphs 98 and 99 of the judgment under appeal, on the basis of which the General Court annulled the regulation at issue, is vitiated by various errors of law in the application of Article 13(1) of the basic regulation.

42.      In the first place, Maxcom takes issue with the General Court for having made a manifestly incorrect application of Article 13(1) of the basic regulation, in that it held that the Council could not conclude that City Cycle had been involved in transhipments on the basis of the finding that it was not a genuine Sri Lankan producer and that it was not engaged in assembly operations beyond the thresholds laid down in Article 13(2) of that regulation. Maxcom therefore maintains that the Court should set aside the findings of the General Court relating to the second part of the first plea.

43.      First, Maxcom claims that the assessment set out in paragraphs 98 and 99 of the judgment under appeal is based on a fundamentally flawed understanding of Article 13(1) of the basic regulation and, in essence, rewards City Cycle for having supplied, in the context of the investigation, incomplete, contradictory and unverifiable information. According to the wording of that article, it is possible to conclude that transhipment operations exist in circumstances such as those of the present case, in which City Cycle imported parts of Chinese origin and exported bicycles to the European Union without proving that it is a producer or that its assembly operations exceed the thresholds laid down in Article 13(2) of that regulation. In addition, the General Court’s assessment is not consistent with either the purpose of the basic regulation, namely to protect European Union industry against dumped imports from third countries, or the established principle that the EU institutions have a wide discretion in anti-dumping investigations.

44.      Second, Maxcom submits that the findings in paragraphs 98 and 99 of the judgment under appeal are contradicted by the General Court’s findings in relation to the second plea in City Cycle’s action, whereby the General Court stated that the information supplied by City Cycle was flawed and rejected the claim based on the assertion that the Council infringed Article 18 of the basic regulation, the principle of proportionality and the obligation to state reasons as regards the finding of non-cooperation on the part of City Cycle.

45.      In the second place, the Commission and the Council maintain that, in the judgment under appeal, the General Court proceeds from the implicit premiss that Article 13(1) of the basic regulation requires that the institutions show that each producer/exporter in the country subject to the investigation engages in transhipment practices. Such an interpretation is incorrect. First, it runs counter to the obligation to assess the conditions set out in Article 13(1) of the basic regulation at country level, and not at individual exporter level. Second, it renders Article 13(4) of the basic regulation devoid of purpose. Third, it confuses the concept of ‘circumventing practice’ with one of its manifestations, namely transhipment. In fact, the institutions are not required specifically to prove the existence of actual circumventing practices. Fourth, the General Court adopted contradictory interpretations of the concept of circumventing practices when assessing the various pleas.

46.      In the third place, Maxcom, the Commission and the Council maintain that the General Court’s findings in paragraphs 98 and 99 are not sufficient, in law, to support the conclusion that there was an infringement of Article 13(1) of the basic regulation. Even if the Council had erred in law in concluding, as indicated in the judgment under appeal, that City Cycle was involved in transhipment operations, it was nonetheless entitled to conclude, on the basis of evidence relating to other Sri Lankan producers/exporters and the change in the pattern of trade, that transhipments had taken place via Sri Lanka. The fact that the Council found that several producers/exporters which had not cooperated in  engaged in transhipments remains valid in law even if the finding is held to be incorrect for one of them. In considering that the finding that one producer had engaged in transhipment rendered illegal the body of evidence on which the conclusion that circumventing practices existed at country level was based, the General Court distorted the meaning of recital 78 of the regulation at issue and thus infringed Article 13(1) of the basic regulation.

47.      City Cycle disputes the arguments put forward by Maxcom, the Commission and the Council.
2.      Assessment
(a)    The principles laid down in the case-law concerning the European Union Rules on circumvention

48.      In points 42 to 54 of the Opinion in the Chin Haur cases, I have made a detailed analysis of the EU rules on circumvention in the light of the Court’s case-law, to which reference is made. For the purposes of these proceedings, I shall merely point out, first of all, that it is clear from the case-law that the burden of proving the existence of circumvention and, more specifically, of all four components of circumvention as listed in the third sentence of Article 13(1) of the basic regulation, and referred to in point 5 of this Opinion, is borne by the institutions. (28)

49.      Next, in that Opinion, I have observed that it follows from the logic and the structure of the EU rules on circumvention that the purpose of the analysis designed to ascertain that the four conditions laid down in Article 13(1) of the basic regulation are satisfied is to prove the existence of circumvention of the anti-dumping duties at the level of the country involved in the anti-circumvention investigation. The specific situation of the individual producers/exporters, on the other hand, is taken into consideration in the context of the analysis under Article 13(4) of the basic regulation. (29)

50.      In that Opinion I observed that it follows from the judgments in Simon, Evers & Co. (30) and APEX (31) that, in the event of lack of cooperation on the part of all the parties concerned by the anti-circumvention investigation, the standard of proof of circumvention to be satisfied by the institutions is significantly lower. The Court has recognised that situation in view of the possibility, provided for in Article 18(1) and (6) of the basic regulation, to make even final findings on the basis of the facts available and to treat a party which does not cooperate or which cooperates only partially less favourably than if it had cooperated. Thus, in such cases, the institutions are authorised to act on the basis of a body of consistent evidence showing the existence of circumvention for the purposes of Article 13(1) of the basic regulation. (32)

51.      In those judgments, however, the Court also stated that it was not the intention of the EU legislature to establish a legal presumption making it possible to infer the existence of circumvention directly from the non-cooperation of the parties interested or concerned, and thereby exempting the EU institutions from any requirement to adduce proof. (33)

52.      In point 69 of the Opinion in the Chin Haur cases, I also considered that, as the reasoning underlying the Court’s interpretation in the judgments in Simon, Evers & Co. and APEX in cases of total failure to cooperate, namely the requirement not to undermine the efficiency of the EU trade defence measures, (34) is also perfectly valid in a case in which the undertakings concerned which did not cooperate in the investigation represent a majority of imports of the product concerned into the European Union.

53.      To my mind that case-law is therefore applicable in a case such as this, in which the producers/exporters which genuinely cooperated in the anti-circumvention investigation represented only 25% of total imports from  into the European Union of the product concerned. (35) Thus, in a case in which the level of non-cooperation is so high, I consider that the institutions are authorised to act on the basis of a body of consistent evidence in order to be able to prove to the requisite legal standard the existence of the constituent elements of circumvention and, more specifically, to establish that the change in the pattern of trade is the consequence of circumventing practices. (36)
(b)    The infringement of Article 13(1) of the basic regulation

54.      In this case, in the judgment under appeal, the General Court upheld the second part of City Cycle’s first plea, alleging infringement of Article 13(1) and Article 18(1) of the basic regulation. Thus, although in the relevant paragraphs of the judgment under appeal the General Court did not specifically explain which provisions had in its view been infringed by the Council in the regulation at issue, it necessarily based the annulment of that regulation on the infringement of those provisions.

55.      More specifically, in paragraph 98 of that judgment, the General Court found that the Council had no evidence from which it could expressly conclude, in recital 78 of the regulation at issue, that City Cycle had been involved in transhipment operations.

56.      As stated in point 13 of this Opinion, in recital 78 of the regulation at issue the Council concluded that the exports of the producers/exporters which had not cooperated in the investigation could be attributed to transhipment practices, on the basis of two factors: the finding of the existence of a change in the pattern of trade between Sri Lanka and the European Union and ‘the fact that not all Sri Lankan producers/exporters came forward and/or cooperated’. On the sole basis of that finding in recital 78 of the regulation at issue, the Council concluded in recital 79 of that regulation that ‘the existence of transhipment of Chinese-origin products via Sri Lanka [was] therefore confirmed’.

57.      A reading of recitals 78 and 79 prompts me to make two observations.

58.      In the first place, I note that, contrary to the approach which it took in the same regulation with regard to Indonesia — the country concerned in the cases involving Chin Haur –, with regard to Sri Lanka the Council did not rely on the finding concerning an individual producer in order to find the existence of transhipment practices at country level, in the words of Article 13(1) of the basic regulation. (37)

59.      In fact, recital 78 of the regulation at issue contains no express finding, such as that in recital 62 of that regulation, according to which, on the basis of an individual analysis, the Council found that a specific company was involved in circumvention practices via transhipment. (38) Recital 78 merely attributes such operations to the undertakings which had not cooperated, inferring the existence of the operations from the two factors mentioned in point 56 of this Opinion: the finding that there had been a change in the pattern of trade and the fact that most Sri Lankan producers/exporters had not cooperated.

60.      However, and in the second place, it must be stated that those two factors, on which the Council based its finding, do not, whether individually or together, substantiate the conclusion either that an individual operator was involved in circumventing practices, specifically in transhipment, or that such practices existed at country level. On the sole basis of those two factors, the Council could not therefore find that the second condition of the existence of circumvention — namely that the change in the pattern of trade stemmed from a practice, operation or work for which there was insufficient due cause or economic justification other than the imposition of the duty — was established. (39)

61.      In fact, the first of those two factors, namely the existence of the change in the pattern of trade, is simply the first condition for the existence of circumvention. It cannot therefore be regarded as an indication of the existence of the second of those conditions: on the contrary, the institutions must prove that all the conditions for the existence of circumvention are satisfied. (40)

62.      As regards the second of those two factors, namely the non-cooperation of the producers/exporters representing 75% of exports to the European Union, it follows from the case-law referred to in point 51 of this Opinion that non-cooperation as such, in the absence of any other factor, cannot give rise to a presumption of circumvention. Accordingly, the Council may not infer directly from fact that a part, even a major part, of the producers/exporters concerned did not cooperate that they were involved in circumventing practices.

63.      Admittedly, as is apparent from points 50, 52 and 53 of this Opinion, in a case, such as the present case, in which the parties concerned which did not cooperate in the investigation represent a majority of imports of the product concerned into the European Union, the burden of proof borne by the institutions is significantly relaxed. However, although in such circumstances the institutions are not required to prove the existence of specific circumventing practices, they must at least have some prima facie evidence of the existence of such practices. (41)

64.      In this case, however, it is not apparent either from the regulation at issue or from the case file that, apart from the two factors mentioned in recital 78 of the regulation at issue (the change in the pattern of trade and non-cooperation), the institutions had other evidence indicating the existence of circumventing practices and in particular transhipment. Quite to the contrary, following a question put by the Court at the hearing, the Commission expressly confirmed that the institutions relied exclusively on those two factors in order to find the existence of circumventing practices at the level of .

65.      In those circumstances, Maxcom, the Commission and the Council cannot in my view properly take issue with the General Court for having erred when it concluded that the Council had infringed Article 13(1) of the basic regulation and, on that ground, annulled the regulation at issue.

66.      That conclusion is not affected by the various arguments put forward in the appeals.

67.      In the first place, Maxcom claims that, in circumstances such as those at issue in the present case, it might be concluded that City Cycle was involved in transhipment. In that regard, however, I have observed in 58 and 59 of this Opinion that, unlike the position as regards Indonesia, in the case of Sri Lanka the Council did not base the finding of the existence of circumventing practices at country level within the meaning of the third sentence of Article 13(1) of the basic regulation (specifically, the existence of transhipment operations in Sri Lanka) on the individual finding concerning a particular producer/exporter (specifically City Cycle). The Council merely inferred the existence of such practices from two factors — indicated in paragraphs 56 and 59 of this Opinion — which, as observed, did not on their own justify such a finding. It follows that, even on the assumption that, on the basis of the evidence in the file, it had been possible in theory to conclude that City Cycle was involved in transhipment, the Council did not base its finding that such transhipment practices existed at country level on such a conclusion. In those circumstances, as the Council’s finding does not rest on sufficient evidence to substantiate it, the General Court cannot be criticised for having found that the Council had infringed Article 13(1) of the basic regulation.

68.      Maxcom next puts forward a number of arguments relating to alleged contradictions in the judgment under appeal. (42) In that regard, I observe, however, that the fact that the information supplied by City Cycle during the investigation was insufficient and did not reflect a spirit of genuine cooperation, with the consequence that the General Court endorsed the Council’s refusal of City Cycle’s exemption request under Article 13(4) of the basic regulation, is not in any way inconsistent with the finding made in points 60 to 65 of this Opinion that the General Court did not err when it found that the Council had infringed Article 13(1) of the basic regulation. (43)

69.      In the second place, as regards the arguments put forward by the Commission and the Council and summarised in point 45 of this Opinion, it is sufficient, in order to reject them, to observe that they are based on an incorrect reading of the judgment under appeal and therefore on an incorrect premiss. In fact, at no point in that judgment did the General Court consider that the institutions must establish positively that each individual producer/exporter engages in transhipment.

70.      In the third place, as regards the claims, summarised in point 46 of this Opinion, that the findings of the General Court are not sufficient to substantiate the annulment of the regulation at issue, it is apparent from the reasoning set out in points 60 to 65 of this Opinion that they must be rejected.

71.      In the light of the foregoing considerations, I consider that the grounds of appeal put forward by Maxcom, the Commission and the Council alleging incorrect application on the part of the General Court of Article 13(1) of the basic regulation must be rejected.

C –    The grounds of appeal alleging failure to state reasons, contradictory reasoning and distortion of the facts

1.      Arguments of the parties

72.      In their second and third grounds of appeal, respectively, the Commission and the Council question the reasoning in the judgment under appeal. The Council also claims that the General Court distorted the facts.

73.      In the first place, the institutions claim that the judgment under appeal does not explain how the Council infringed Article 13(1) of the basic regulation. First, they maintain that the judgment under appeal does not state whether the error made by the Council is a simple error of assessment or a manifest error of assessment. Second, they claim that the General Court does not explain whether the evidence adduced before it, including the facts available, does not support the conclusion that City Cycle engaged in transhipment activities.

74.      In the second place, the Commission maintains that the reasoning in the judgment under appeal is contradictory. In that regard, it observes that it follows from paragraph 97 of the judgment under appeal that the evidence adduced by City Cycle does not prove that it was indeed an exporter of Sri Lankan origin or that it met the criteria laid down in Article 13(2) of the basic regulation. The Commission wonders in that regard how that evidence, if it shows that City Cycle engages in circumvention activities through assembly, could not show that it is also engaged in transhipment.

75.      The Council claims, in the alternative, that the General Court distorted the established facts. First, since transhipment was duly demonstrated at country level and since City Cycle’s exemption request was unfounded, the Council submits that the only conclusion that the General Court could draw from the facts was that City Cycle engaged in transhipment. In drawing a different conclusion, the General Court distorted the facts. Second, that distortion of the facts is also apparent from the findings in the judgment under appeal relating to City Cycle’s exemption request, which preclude the possibility that City Cycle satisfied the conditions that must be met in order for assembly in the country covered by the investigation to confer a local origin on the products.
2.      Assessment

76.      As regards, in the first place, the claims alleging failure to state reasons, it should be borne in mind that, according to settled case-law, the statement of the reasons on which a judgment of the General Court is based must clearly and unequivocally disclose that Court’s reasoning in such a way as to enable the persons concerned to ascertain the reasons for the decision taken and the Court of Justice to exercise its power of review. The obligation to state reasons borne by the General Court under Article 36 and the first paragraph of Article 53 of the Statute of the Court of Justice of the European Union is satisfied where, even though it is implicit, the reasoning applied enables the persons concerned to know why the General Court has not upheld their arguments and provides the Court of Justice with sufficient material for it to exercise its power of review. (44)

77.      It is apparent from points 54 and 55 of this Opinion that even though in the judgment under appeal the General Court did not set out in detail the reasoning that prompted it to conclude that the regulation at issue must be partially annulled in so far as it concerns City Cycle, that reasoning may be inferred unequivocally from that judgment, and the Court of Justice is thus able to exercise its power of review. From that aspect, the judgment under appeal cannot in my view be considered to be vitiated by a failure to state reasons.

78.      As regards the other claims, first, to my mind the claim alleging that the judgment under appeal is vitiated by a failure to state reasons in that it does not explain whether the error made by the Council is a simple error of assessment or a manifest error of assessment cannot succeed. Although it is certainly desirable that the General Court should indicate in its judgment the standard of judicial review which it applies, a judgment cannot be considered to be vitiated by a failure to state reasons solely because the General Court does not expressly state in the judgment under appeal the standard of judicial review which it has applied. As the institutions have not claimed that the General Court applied an incorrect standard of judicial review, but merely claimed failure to state reasons, (45) the question whether the standard actually applied in the judgment under appeal was incorrect or not is not part of the subject matter of the present appeals.

79.      Second, as regards the claim that the General Court failed to explain whether the evidence adduced before it, including the facts available, do not permit the conclusion that City Cycle engaged in transhipment, it cannot succeed either. It is clear from the case-law that it is not for the Court of Justice to require the General Court to provide reasons for each of its choices where it relies on one item of evidence as opposed to another in support of its decision. To decide otherwise would be tantamount to the Court of Justice substituting its own assessment of that evidence for that made by the General Court, which it is not empowered to do.(46)

80.      As regards, in the second place, the claim alleging contradictory reasoning, I consider that it is based on an incorrect reading of the judgment under appeal. In fact, in paragraph 97 of the judgment under appeal, the General Court did not state that the evidence adduced by City Cycle indicated that it engaged in circumvention activities through assembly.

81.      As regards, in the third place, the claims whereby the Council alleges distortion of the facts, it should be borne in mind that, according to the case-law, such distortion must be obvious from the documents on the Court’s file, without there being any need to carry out a new assessment of the facts and the evidence. (47)

82.      In fact, the Council’s entire line of argument is based on the premiss that the existence of transhipment operations at country level, within the meaning of Article 13(1) of the basic regulation, has been demonstrated. However, it is clear from points 60 to 65 of this Opinion that in my view the General Court was correct to find that that was not so. It follows that the premiss of the Council’s claim is incorrect. It follows that the General Court did not distort the facts, contrary to the Council’s contention.

83.      It follows from the foregoing that in my view both the Commission’s third ground of appeal in Case C‑254/15 P and the Council’s second ground of appeal in Case C‑260/15 P must be rejected.

84.      In those circumstances, I consider that the appeals lodged by Maxcom, the Commission and the Council should be dismissed in their entirety.
VI –  Costs

85.      Under Article 184(2) of the Rules of Procedure, where the appeal is unfounded, the Court is to make a decision as to the costs. Under Article 138(1) of those rules, which apply to the procedure on appeal pursuant to Article 184(1) of those rules, the unsuccessful party is to be ordered to pay the costs if they have been applied for in the successful party’s pleadings.

86.      If the Court adopts my assessments concerning the three joined appeals, Maxcom, the Commission and the Council will be unsuccessful. As City Cycle has requested that they be ordered to pay the costs, I propose that the Court order Maxcom, the Commission and the Council to pay the costs incurred by City Cycle in both the proceedings at first instance and in the appeal proceedings.
VII –  Conclusion

87.      In the light of the foregoing considerations, I propose that the Court should:
(1)      dismiss the appeals;
(2)      order Maxcom Ltd, the European Commission and the Council of the European Union to pay the costs incurred by City Cycle Industries at first instance and in these proceedings.

1      Original language: French.

2      T‑413/13, EU:T:2015:164.

3      Regulation of 29 May 2013 extending the definitive anti-dumping duty imposed by Implementing Regulation (EU) No 990/2011 on imports of bicycles originating in the People’s Republic of China to imports of bicycles consigned from Indonesia, Malaysia, Sri Lanka and Tunisia, whether declared as originating in Indonesia, Malaysia, Sri Lanka and Tunisia or not (OJ 2013 L 153, p. 1).

4      T‑412/13, EU:T:2015:163.

5      In the interest of conciseness, in this Opinion I shall refer on a number of occasions to the more detailed analysis made in the Opinion in the Chin Haur cases.

6      Regulation of 30 November 2009 on protection against dumped imports from countries not members of the European Community (OJ 2009 L 343, p. 51, and corrigendum OJ 2010 L 7, p. 22), as amended by Regulation (EU) No 1168/2012 of the European Parliament and of the Council of 13 June 2012 (OJ 2012 L 237, p. 1).

7      In this instance, the existence of three other factors was definitively established in the judgment under appeal and is not called in question in these proceedings.

8      Commission Regulation (EU) No 875/2012 of 25 September 2012 initiating an investigation concerning the possible circumvention of anti-dumping measures imposed by Council Implementing Regulation (EU) No 990/2011 on imports of bicycles originating in the People’s Republic of China by imports of bicycles consigned from Indonesia, Malaysia, Sri Lanka and Tunisia, whether declared as originating in Indonesia, Malaysia, Sri Lanka and Tunisia or not, and making such imports subject to registration (OJ 2012 L 258, p. 21).

9      Council Implementing Regulation (EU) No 990/2011 of 3 October 2011 imposing a definitive anti-dumping duty on imports of bicycles originating in the People’s Republic of China following an expiry review pursuant to Article 11(2) of Regulation (EC) No 1225/2009 (OJ 2011 L 261, p. 2). See paragraphs 2 to 6 of the judgment under appeal for reference to the earlier regulations.

10      In that regard, see, in greater detail, paragraphs 8 to 18 of the judgment under appeal.

11      See, respectively, recitals 45 to 58 and 77 to 79 of the regulation at issue, and also recitals 92 (concerning the absence of reasons or economic justification other than the intention to avoid the anti-dumping measures in force), 93 to 96 (concerning the neutralisation of the corrective effects of those measures) and 107 to 110 (concerning the existence of dumping by reference to normal value previously established) of the regulation at issue.

12      See recitals 80 to 82 of the regulation at issue.

13      See recitals 115 to 117 and Article 1(1) and (3) of the regulation at issue.

14      See recital 126 and Article 1(1) of the regulation at issue.

15      See Article 76a of the Rules of Procedure of the General Court in force at the time of the proceedings before that court.

16      That decision was adopted pursuant to the second subparagraph of Article 76a(2) of the Rules of Procedure of the General Court in force at the time of the proceedings before that court.

17      Under the second subparagraph of Article 76a(2) of the Rules of Procedure of the General Court in force at the time of the proceedings before that court, where a case is to be determined under the expedited procedure, the intervener could lodge a statement in intervention only if the General Court so allowed by way of measures of organisation of procedure adopted in accordance with Article 64 of those Rules of Procedure. The Commission’s request was based on that provision.

18      The second plea in law alleged infringement of Article 18 of the basic regulation, of the principle of proportionality and also of the obligation to state reasons. It concerned the Council’s finding that City Cycle had not cooperated. The third plea alleged breach of the principles of diligence and sound administration and infringement of Article 18(4) of the basic regulation and of City Cycle’s rights of defence. It sought to demonstrate that the Council had not informed City Cycle appropriately of its intention to reject its request for exemption and had not granted it full access to the file. The fourth plea alleged breach of the principle of equal treatment. The fifth plea alleged infringement of Article 13(1) of the basic regulation and breach of the principle of equal treatment and concerned the Council’s finding of the existence of dumping.

19      See paragraphs 100 and 185 of the judgment under appeal.

20      First plea in the Commission’s appeal in Case C‑254/15 P.

21      First and second grounds of appeal in Maxcom’s appeal in Case C‑248/15 P, second ground of appeal in the Commission’s appeal in Case C‑254/15 P and first ground of appeal in the Council’s appeal in Case C‑260/15 P.

22      Third ground of appeal in the Commission’s appeal in Case C‑254/15 P and second ground of appeal in the Council’s appeal in Case C‑260/15 P.

23      Fourth ground of appeal in the Commission’s appeal in Case C‑254/15 P.

24      Judgment of 1 July 2008, Chronopost and La Poste (UFEX) and Others (C‑341/06 P and C‑342/06 P, EU:C:2008:375, paragraph 67 and the case-law cited).

25      See, in particular, judgment of 29 April 2004, Italy v Commission (C‑298/00 P, EU:C:2004:240, paragraph 35), and order of the President of the Court of 24 March 2009, Cheminova and Others v Commission (C‑60/08 P(R), not published, EU:C:2009:181, paragraph 31).

26      See judgment of 24 March 1993, CIRFS and Others v Commission (C‑313/90, EU:C:1993:111, paragraph 23 and the case-law cited). In that regard, it should be pointed out that Article 150 of the Rules of Procedure states that the Court may at any time of its own motion decide to rule on whether there exists any absolute bar to proceeding with the case. Furthermore, according to what is now settled case-law, the Court has held that the Courts of the European Union must raise of their own motion pleas involving a matter of public policy (see, in particular, judgments of 2 April 1998, Commission v Sytraval and Brink’s France (C‑367/95 P, EU:C:1998:154, paragraph 67); of 8 December 2011,  Germany and Others v Commission (C‑272/09 P, EU:C:2011:810); and of 19 December 2013, Siemens v Commission (C‑239/11 P, C‑489/11 P and C‑498/11 P, not published, EU:C:2013:866, paragraph 321). In that regard, see also Opinion of Advocate General Bot in Philips Lighting Poland and Philips Lighting v Council (C‑511/13 P, EU:C:2015:206, paragraph 56).

27      In that regard, see judgment of 18 September 2014, Valimar (C‑374/12, EU:C:2014:2231, paragraph 30 and the case-law cited). For an overview of the case-law on locus standi to bring proceedings against decisions relating to anti-dumping measures in general, see point 92 et seq. of the Opinion of Advocate General Bot in Philips Lighting Poland and Philips Lighting v Council (C‑511/13 P, EU:C:2015:206).

28      See judgment of 4 September 2014, Simon, Evers & Co. (C‑21/13, EU:C:2014:2154, paragraph 35) and point 45 of the Opinion in the Chin Haur cases.

29      See points 46 to 48 of the Opinion in the Chin Haur cases.

30      Judgment of 4 September 2014 (C‑21/13, EU:C:2014:2154).

31      Judgment of 17 December 2015 (C‑371/14, EU:C:2015:828).

32      See judgments of 4 September 2014, Simon, Evers & Co. (C‑21/13, EU:C:2014:2154, paragraphs 30 to 37), and 17 December 2015, APEX (C‑371/14, EU:C:2015:828, paragraphs 62 to 69); see points 49, 50 and 52 of the Opinion in the Chin Haur cases.

33      See judgments of 4 September 2014, Simon, Evers & Co. (C‑21/13, EU:C:2014:2154, paragraph 36) and 17 December 2015, APEX (C‑371/14, EU:C:2015:828, paragraph 68); see point 51 of the Opinion in the Chin Haur cases.

34      See judgments of 4 September 2014, Simon, Evers & Co. (C‑21/13, EU:C:2014:2154, paragraph 37) and 17 December 2015, APEX (C‑371/14, EU:C:2015:828, paragraph 69).

35      This figure is not given in the regulation at issue, but was provided by the Commission at the hearing.

36      See point 69 of the Opinion in the Chin Haur cases.

37      See point 49 of this Opinion.

38      See recitals 62 and 64 of the regulation at issue and points 56, 57 and 75 of the Opinion in the Chin Haur cases.

39      In that regard, see also the analysis in point 87 of the Opinion in the Chin Haur cases.

40      See point 48 of this Opinion and the references in footnote 28.

41      See, to that effect, judgment of 4 September 2014, Simon, Evers & Co. (C‑21/13, EU:C:2014:2154, point 53) and, in greater detail, points 70 and 71 of the Opinion in the Chin Haur cases.

42      See point 44 of this Opinion.

43      On the relationship between paragraphs 1 and 4 of Article 13 of the basic regulation, see point 49 of this Opinion. See also point 48 and footnote 36 of the Opinion in the Chin Haur cases.

44      See in particular, to that effect, judgment of 10 April 2014, Areva and Others v Commission (C‑247/11 P and C‑253/11 P, EU:C:2014:257, paragraphs 54 and 55).

45      In the context of the second ground of appeal, alleging errors in the application of Article 13(1) of the basic regulation, the Commission, after asserting that the judgment under appeal is not sufficiently reasoned as regards the reasons why the regulation at issue infringed that provision, characterises as an error of law the fact that ‘the judgment under appeal does not even articulate a standard of review, and in particular does not indicate whether the Council made a simple error of assessment or a manifest error of assessment’. In that connection, however, the Commission does not develop any line of argument concerning that complaint and merely refers expressly to its second ground of appeal, alleging failure to state reasons, where the error is to be ‘analysed in more detail’. It must be noted that the mere characterisation as an error of law of the failure to mention the standard of judicial review applied by the General Court without supporting that characterisation by any argument or reasoning other than a general reference to the plea alleging failure to state reasons cannot be interpreted as an independent plea alleging that the General Court exceeded the requisite standard of judicial review, thus infringing the discretion conferred on the institutions by the case-law (judgment of 4 September 2014, Simon, Evers & Co. (C‑21/13, EU:C:2014:2154, paragraph 29 and the case-law cited). In those circumstances, the Commission’s complaint coincides, in essence, with the complaint alleging failure to state reasons analysed in the present point. In that regard, I note that it follows from Article 168(1)(d) of the Rules of Procedure of the Court of Justice that the appellants are to develop in a sufficient manner the arguments on which they rely in support of their appeals.

46      See judgment of 16 February 2012, Council and Commission v Interpipe Niko Tube and Interpipe NTRP (C‑191/09 P and C‑200/09 P, EU:C:2012:78, paragraph 161).

47      See judgment of 2 June 2016, Photo USA Electronic Graphic v Council (C‑31/15 P, EU:C:2016:390, paragraph 52 and the case-law cited).