CELEX: 52012PC0634
Language: en
Date: 2012-11-05
Title: Proposal for a COUNCIL IMPLEMENTING REGULATION imposing a definitive anti-dumping duty on imports of chamois leather originating in the People’s Republic of China following an expiry review pursuant to Article 11(2) of Council Regulation (EC) No 1225/2009

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		52012PC0634
		
			Proposal for a COUNCIL IMPLEMENTING REGULATION imposing a definitive anti-dumping duty on imports of chamois leather originating in the People’s Republic of China following an expiry review pursuant to Article 11(2) of Council Regulation (EC) No 1225/2009 /* COM/2012/0634 final - 2012/0300 (NLE) */
			
				
		
		
			
			   	EXPLANATORY MEMORANDUM
1)           CONTEXT OF THE PROPOSAL
·      Grounds for and objectives of the proposal
This proposal concerns the application of
Council Regulation (EC) No 1225/2009 of 30 November 2009 on protection against
dumped imports from countries not members of the European Community ('the basic
Regulation'), in the expiry review proceeding concerning the anti-dumping duty
in force in respect of chamois leather originating in the People’s Republic of
China.
·      General context
This proposal is made in the context of the
implementation of the basic Regulation and is the result of an investigation
which was carried out in line with the substantive and procedural requirements
laid out in the basic Regulation.
·      Existing provisions in the area of the proposal
A definitive anti-dumping duty on imports of
chamois leather falling within CN codes 4114 10 10 and 4114 10 90 originating
in the People's Republic of China was imposed by Council Regulation (EC) No
1338/2006 (OJ L 251, 14.9.2006, p. 1.).
·      Consistency with other policies and objectives of the Union
Not applicable.
2)           CONSULTATION OF INTERESTED PARTIES AND
IMPACT ASSESSMENT
·      Consultation of interested parties
Interested parties concerned by the proceeding
have had the possibility to defend their interests during the investigation, in
line with the provisions of the basic Regulation.
·      Collection and use of expertise
There was no need for external expertise.
·      Impact assessment
This proposal is the result of the
implementation of the basic Regulation.
The basic Regulation does not provide for a
general impact assessment but contains an exhaustive list of conditions that
have to be assessed.
3)           LEGAL ELEMENTS OF THE PROPOSAL
·      Summary of the proposed action
On 13 September 2011, upon substantiated
request of two Union producers, the Commission initiated an expiry review of
the anti-dumping duty in force in respect of imports of chamois leather
originating in the People’s Republic of China.
The review investigation found that there is a
likelihood of a continuation of dumping and injury to the Union industry should
the anti-dumping measures be allowed to expire. It was further established that
continuation of measures would not be against the interest of the Union.
Therefore, it is suggested that the Council
adopts the attached proposal for a Regulation in order to prolong the existing
measures, which should be published in the Official Journal of the European
Union by 12 December 2012 at the latest.
·      Legal basis
Council Regulation (EC) No 1225/2009 of 30
November 2009 on protection against dumped imports from countries not members
of the European Community.
·      Subsidiarity principle
The proposal falls under the exclusive
competence of the European Union. The subsidiarity principle therefore does not
apply.
·      Proportionality principle
The proposal complies with the proportionality
principle for the following reasons:
The form of action is described in the
above-mentioned basic Regulation and leaves no scope for national decision.
Indication of how financial and administrative
burden falling upon the Union, national governments, regional and local
authorities, economic operators and citizens is minimized and proportionate to
the objective of the proposal is not applicable.
·      Choice of instruments
Proposed instruments: regulation.
Other means would not be adequate for the
following reason:
The basic Regulation does not provide for
alternative options.
4)           BUDGETARY IMPLICATION
The proposal
has no implication for the Union budget.
2012/0300 (NLE)
Proposal for a
COUNCIL IMPLEMENTING REGULATION 
imposing a definitive anti-dumping duty on
imports of chamois leather originating in the People’s Republic of China following an expiry review pursuant to Article 11(2) of Council Regulation (EC) No
1225/2009
THE COUNCIL OF THE EUROPEAN UNION,
Having regard to the Treaty on the
Functioning of the European Union,
Having regard to Council Regulation (EC) No
1225/2009 of 30 November 2009 on protection against dumped imports from
countries not members of the European Community[1]
('the basic Regulation'), and in particular Article 9(4) and 11(2). 
Having regard to the proposal submitted by
the European Commission ('the Commission') after consulting the Advisory
Committee,
Whereas:
A.        PROCEDURE
1.           Measures in force
(1)       The Council, following an
anti-dumping investigation ('the original investigation'), imposed by
Regulation (EC) No 1338/2006[2]
a definitive anti-dumping duty on imports of chamois leather currently falling
within CN code 4114 10 10 and 4114 10 90 originating in the People's Republic
of China ('PRC' or the country concerned) ('the definitive anti-dumping
measures'). The measures took the form of an ad valorem duty at the
level of 58.9%.
2.           Request for an expiry
review
(2)       Following
the publication of a notice of impending expiry[3] of the
definitive anti-dumping measures in force, the Commission received on 14 June
2011 a request for the initiation of an expiry review of these measures
pursuant to Article 11(2) of the basic Regulation. The request was lodged by
the UK Leather Federation (‘the applicant’), representing more than 50%, of the
total Union production of chamois leather.
(3)       The application submitted
was based on the grounds that the expiry of the measures would be likely to
result in a continuation of dumping and injury to the Union industry.
3.           Initiation of an expiry
review
(4)       Having determined, after
consulting the Advisory Committee, that sufficient evidence existed for the
initiation of an expiry review, the Commission announced on 13 September 2011,
by a notice published in the Official Journal of the European Union[4] ('the Notice of initiation'),
the initiation of an expiry review pursuant to Article 11(2) of the basic
Regulation.
4.           Investigation
4.1.        Review investigation period
and period considered
(5)       The investigation of a
continuation of dumping covered the period from 1 July 2010 to 30 June 2011
('the review investigation period' or 'RIP'). The examination of the trends
relevant for the assessment of the likelihood of a continuation of injury
covered the period from 1 January 2008 to the end of the review investigation
period ('the period considered').
4.2.        Parties concerned by the
investigation
(6)       The Commission officially
advised the applicant and other known Union producers, exporting producers in
the country concerned, unrelated importers, users in the Union known to be
concerned, and the representatives of the exporting country of the initiation
of the expiry review. Interested parties were given the opportunity to make
their views known in writing and to request a hearing within the time limit set
out in the Notice of initiation.
(7)       In
view of the apparent large number of Union producers,
exporting producers and unrelated importers, it was
considered appropriate, in accordance with Article 17 of the basic Regulation,
to examine whether sampling should be used. In order to enable the Commission
to decide whether sampling would be necessary and, if so, to select a sample,
those parties were requested, pursuant to Article 17 of the basic Regulation,
to make themselves known within 15 days of the initiation of the review and to
provide the Commission with the information requested in the Notice of
initiation.
(8)       Sampling for Union
producers has been applied and out of three known Union producers two groups of
producers have been sampled.
(9)       Six known exporting
producers in the PRC were contacted. However, none of these companies
cooperated in the investigation.
(10)     With regard to importers,
35 unrelated importers of chamois leather in the Union were identified and
invited to provide sampling information. Only two of them came forward and were
willing to cooperate in the current review. Consequently, no sampling was necessary
for unrelated importers.
(11)     The Commission sent
questionnaires to all parties known to be concerned and to those who made
themselves known within the deadlines set in the Notice of initiation. Replies
were received from the sampled groups of Union producers and two cooperating
unrelated importers. None of the exporting producers in the PRC cooperated in
the review and no relevant consumer association supplied the Commission with
any information or made itself known in the course of the investigation.
(12)     The
Commission sought and verified all the information it deemed necessary for a
determination of the likelihood of a continuation of dumping and resulting
injury and of the Union interest. Verification visits were carried out at the
premises of the following interested parties:
Union producers
–              
Hutchings&Harding Ltd, Cambridge, United Kingdom; and
–              
Marocchinerie e Scamoscerie Italiane Spa, Turin,
Italy.
B.        PRODUCT CONCERNED AND
LIKE PRODUCT
(13)     The product concerned by
this review is the same as the one in the original investigation, namely
chamois leather and combination chamois leather, whether or not cut to shape, including
crust chamois leather and combination crust chamois leather originating in the
People’s Republic of China ('the product concerned'), currently falling within
CN codes 4114 10 10 and 4114 10 90.
(14)     The investigation confirmed
that, as in the original investigation, the product concerned and the products
manufactured and sold on the domestic market in the PRC, as well as those
manufactured and sold in the Union by the Union producers, have the same basic
physical and technical characteristics as well as the same uses and are,
therefore, considered to be like products within the meaning of Article 1(4) of
the basic Regulation.
C.        LIKELIHOOD OF A
CONTINUATION OF DUMPING
(15)     In accordance with Article
11(2) of the basic Regulation, it was examined whether the expiry of the
existing measures would be likely to lead to a continuation of dumping.
1.           Preliminary remarks
(16)     As stated in recital (9)
above, none of the six Chinese exporting producers contacted cooperated with
the investigation and findings on the likelihood of a continuation of dumping
had to be based on facts available, in particular information submitted by the applicant,
including information in the review request, and statistics in accordance with
Article 18 of the basic Regulation.
2.           Dumping of imports during
the RIP
2.1.        Analogue
country
(17)     In
accordance with the provisions of Article 2(7)(a) of the basic Regulation,
normal value had to be determined on the basis of the price or constructed
normal value obtained in an appropriate market economy third country ('the
analogue country'), or the price from the analogue country to other countries,
including the Union, or, where those are not possible, on any other reasonable
basis, including the price actually paid or payable in the Union for the like
product, duly adjusted if necessary to include a reasonable profit margin.
(18)     In the original
investigation, the USA served as an analogue country
for the purpose of establishing the normal value. The only chamois leather
producer operating in the USA at the time of the original investigation has
since closed its production site. Since then its chamois leather has been
imported from a joint venture company in Turkey. As there is no more
significant production of chamois leather left in the United States other countries, i.e. New Zealand, Turkey and India, were envisaged as analogue
countries in the Notice of initiation of the present review. Potential analogue
country producers located in India, Turkey and New Zealand were contacted, but
no cooperation could be obtained.
(19)     Regarding
the normal value, in the absence of cooperation from an analogue country
producer, it was determined on the basis of information on the average price of Indian imports into the Union as available in the import statistics from Eurostat for the RIP. (India being the country with the highest volume of imports into the Union).
Regarding the export price, in the absence of cooperation from the exporting
producers from the PRC, it was based on the information on the average price of
the Chinese imports into the Union as available in the import statistics from
Eurostat for the RIP. On that basis the dumping margin
was established as the difference between the average price of the Indian
imports into the Union used as normal value and the average price of the
Chinese imports used as export price. The dumping calculation resulted in a
dumping margin of 64%.
2.2.        Development of imports
should measures be repealed
(20)     Further to the analysis of
the existence of dumping during the RIP, the likelihood of continuation of
dumping should measures be repealed was investigated. Given the fact that no
exporting producer in the PRC cooperated in this investigation, the conclusions
below rely on facts available in accordance with Article 18 of the basic
Regulation, namely information provided in the review request, data provided by
the applicant, as well as Eurostat data.
(21)     In this respect, the
following elements were analysed: development of imports from the PRC,
production and spare capacity of the exporting producers and attractiveness of
the Union market in terms of prices and volumes.
(22)     As indicated in recital (32)
below, the price comparison between imports from the PRC in the RIP and Union industry prices shows significant undercutting (51.6%). The Union market continues to
be attractive for Chinese exporting producers, both in terms of price and
volumes. This is reinforced by the fact that there are significant production
capacities available in the PRC since the imposition of measures when imports
from the PRC were reduced. Already prior to the imposition of measures the PRC
tripled its Union market share for this product - from 10.7% market share of
the Union market in 2001 to 31.7% in 2004. Furthermore, Chinese export prices to the Union are still higher than those on
the markets of certain other third countries making the Union market attractive
to the Chinese exporting producers.
(23)     The foregoing analysis
demonstrates that Chinese exports continued to enter the Union market at dumped
prices with very high dumping margins. Given most notably the analysis of price
levels in the Union as well as capacities available in the PRC, it can be
concluded there is a likelihood of a continuation of dumping should measures be
removed.
D.        INJURY
1.           Union industry
(24)     Within the Union, the like product is manufactured by three (groups of) companies. Two of them are represented
by the applicant and are based in the UK and Italy with some processing in Poland and Romania. A third producer is based in Italy and is supporting the request. All other
chamois leather producers are reported to have closed their manufacturing sites
since 2006 when the original measures were introduced.
(25)     The
total Union production within the meaning of Article 4(1) of the basic
Regulation was established on the basis of the questionnaire replies from the
sampled Union producers and the basic macro data submitted by the third
producer in the standing/sampling exercise. Those companies constitute the
Union industry within the meaning of Article 4(1) and Article 5(4) of the basic
Regulation and will be thereafter referred to as the 'Union industry. The two sampled producers account for 80% of the Union production.
(26)     Since the microeconomic
injury indicators are based on data of two companies only, they are presented
in an indexed format in order to preserve confidentiality, pursuant to Article
19 of the basic Regulation.
2.           Consumption
in the Union market
(27)     Union consumption was established on the basis of the sales volumes of
the Union industry on the Union market and import data from Eurostat.
(28)     It is also noted that since
2010 there have been significant volumes of low-priced chamois leather exported
to the rest of the Union via Spain (some 31% in terms of market share). It is
noted that Spain has no longer any production of the like product and the sales
of chamois leather from Spain to the rest of the Union exceed imports. Those
volumes have been added to the consumption figure. Between 2008 and the RIP, Union consumption increased by 26%, with the
main increase occurring between 2009 and 2010.
Table
1
   || 2008 || 2009 || 2010 || RIP 
 Total Union consumption (`000 sq ft) * || 22,107 || 22,300 || 28,434 || 27,827 
 Index (2008=100) || 100 || 101 || 129 || 126 
* Data from Eurostat and questionnaire
replies
3.           Imports from the PRC
(a) Volume and market share
(29)     Following
the imposition of measures in 2006, the Chinese imports decreased significantly
and are still rather limited, corresponding to a market share of some 4% during
the RIP. Notwithstanding, over the period considered the volume of imports
originating in the PRC has increased by 9 percentage points and reached a level
of 1,103,330 square feet during the RIP. However, Chinese imports did not
increase at the same rate as Union consumption and the market share of Chinese
imports decreased over the period considered.
Table
2
   || 2008 || 2009 || 2010 || RIP 
 Volume of imports from the country concerned (`000 sq ft)* || 1,010.00 || 786.67 || 883.33 || 1,103.33 
 Index (2008=100) || 100 || 78 || 87 || 109 
 Market share of imports from the country concerned * || 5% || 4% || 3% || 4% 
* Data from
Eurostat
(b) Prices
(i) Price
evolution
(30)     The average price of the
Chinese imports have varied over the period considered. Compared to 2008, the
price initially increased in 2009 before dropping by 13% in 2010 and climbing
back to its 2008 level during the RIP.
Table 3
   || 2008 || 2009 || 2010 || RIP 
 Price of imports from the country concerned  (EUR/sq ft) * || 0.45 || 0.61 || 0.39 || 0.46 
 Index (2008=100) || 100 || 136 || 87 || 102 
* Data from Eurostat 
(ii) Price
undercutting
(31)     For the purpose of
analysing price undercutting, the weighted average sales prices of the Union
industry to unrelated customers on the Union market were compared to the
corresponding weighted average CIF prices of exporters from the PRC. Therefore,
the sales prices of the Union industry have been adjusted in particular for
credit costs, delivery costs, packaging and commissions to an ex-works level.
The CIF prices of exports from the PRC have been obtained from Eurostat and
adjusted to cover all costs related to customs clearance, i.e. customs tariff
and post importation costs (landed price).
(32)     The comparison showed that
during the RIP the imports of the product concerned undercut the Union
industry's prices by around 51.6%.
4.           Economic situation of the
Union industry
(33)     Pursuant to Article 3(5) of
the basic Regulation, the examination of the impact of the dumped imports on
the Union industry included an evaluation of all economic factors and indices
having a bearing on the state of the Union industry during the period
considered.
(34)     For the purpose of the
injury analysis, the injury indicators have been established at the following
two levels:
–     
The macroeconomic indicators (production,
capacity, sales volume, market share, growth, employment, productivity, average
unit prices and magnitude of dumping margins and recovery from the effects of
past dumping) were assessed at the level of the whole Union industry, on the
basis of the information collected from the full questionnaire replies by the
sampled companies and the macro data provided by the third Union producer.
–     
The analysis of microeconomic indicators
(stocks, wages, profitability, return on investments, cash flow, ability to
raise capital and investments) was based on the information derived from the
duly verified questionnaire replies provided by the sampled companies. This
information is considered to be representative of the whole Union industry.
Given that these indicators relate to two companies only, the absolute figures
cannot be disclosed for confidentiality reasons pursuant to Article 19 of the
basic Regulation and only indices are provided below.
(a) Macroeconomic indicators
4.1.        Production
(35)     Since
2008 the Union production decreased continuously and was ending up 12% below
its 2008 level during the RIP, despite the fact that consumption was increasing
at the same time by 26%.
Table
4
   || 2008 || 2009 || 2010 || RIP 
 Production (`000 sq ft) * || 7,659 || 7,223 || 7,100 || 6,753 
 Index (2008=100) || 100 || 94 || 93 || 88 
* Data from questionnaire replies
4.2.        Production capacity and
capacity utilisation rates
(36)     Production capacity
remained stable between 2008 and the RIP. While capacity utilisation was
already at a low level in 2008, the decrease in production between 2008 and the
RIP led to a further significant decrease of capacity utilisation by 7
percentage points between 2008 and the RIP.
Table
5
   || 2008 || 2009 || 2010 || RIP 
 Production capacity (`000 sq ft) * || 13,290 || 13,290 || 13,290 || 13,290 
 Index (2008=100) || 100 || 100 || 100 || 100 
 Capacity utilisation* || 58% || 54% || 53% || 51% 
 Index (2008=100) || 100 || 94 || 93 || 88 
* Data from questionnaire replies
4.3.        Sales volume
(37)     The sales by the Union industry on the Union
market to unrelated customers increased by 5% between 2008 and 2009,
before dropping 2% in 2010 and rising again during the RIP. Over all, the sales
volume increase by 9% over the period considered.
Table
6
   || 2008 || 2009 || 2010 || RIP 
 Union Sales volume to unrelated customers (`000 sq ft) * || 5,144 || 5,393 || 5,324 || 5,627 
 Index (2008=100) || 100 || 105 || 103 || 109 
* Data from questionnaire replies
4.4.        Market share
(38)     Between 2008 and 2009 the Union industry managed
to slightly regain 1% market share from its already low level of 23% in 2008,
before its market share declined by 4 percentage points to only 20% in the RIP.
Table
7
   || 2008 || 2009 || 2010 || RIP 
 Market share of the Union industry* || 23% || 24% || 19% || 20% 
 Index (2008=100) || 100 || 104 || 80 || 87 
* Data from Eurostat and questionnaire
replies
4.5.        Growth
(39)     Between 2008 and the RIP,
whilst the Union consumption increased by 26%, the volume of sales by the Union
producers on the Union market increased only by 9%, and the Union producers'
market share decreased by 3 percentage points. It is thus concluded that the
Union producers could hardly benefit from the growth of the market.
4.6.        Employment
(40)     After a first significant 9% drop of employment between 2008 and 2009,
the level of employment of the Union industry continued to decline. From 74
employees in 2008 only 59 employees are left in the RIP, which means an overall
drop of 19%.
Table
8
   || 2008 || 2009 || 2010 || RIP 
 Employment product concerned (persons)* || 74 || 67 || 62 || 59 
 Index (2008=100) || 100 || 91 || 84 || 81 
* Data from
questionnaire replies
4.7.        Productivity
(41)     Productivity of the Union industry's workforce, measured as output per
person employed per year, increased by 9% between 2008 and the RIP. This is a
reflection of the fact that employment declined at a faster pace than the
production.
Table
9
   || 2008 || 2009 || 2010 || RIP 
 Productivity (sq ft per employee) || 104,031 || 107,536 || 114,512 || 113,655 
 Index (2008=100) || 100 || 103 || 110 || 109 
* Data from
questionnaire replies
4.8.        Sales prices and factors
affecting domestic prices
(42)     Unit sales prices of the
Union industry have remained stable between 2008 and the RIP. As mentioned
above the Union industry prices were significantly undercut by the dumped Chinese
imports. However, the maintained prices level has been at the expense of the
Union Industry's market share.
Table
10
   || 2008 || 2009 || 2010 || RIP 
 Unit price Union market (EUR/sq ft)* || 1.01 || 0.97 || 1.01 || 1.01 
 Index (2008=100) || 100 || 96 || 100 || 100 
* Data from
questionnaire replies
4.9.        Magnitude of dumping margin
(43)     Given the volume, market share and prices of the
imports from the PRC, the impact on the Union industry of the actual margin of
dumping cannot be considered to be negligible.
4.10.      Recovery from the effects of
past dumping
(44)     The indicators examined
above show that, notwithstanding the imposition of the anti-dumping measures in
2006, the economic and financial situation of the Union industry has remained
substantially fragile and injurious. Thus, no actual recovery from the past
dumping could be established and it is considered that the Union industry
remains vulnerable to the injurious effect of any dumped imports in the Union
market.
(b) Microeconomic indicators
4.11.      Stocks
(45)     The level of closing stocks of the Union industry increased significantly
by 31% between 2008 and the RIP. Further analysis allowed the
fine-tuning of the assessment of the evolution on the number of months of
production being stocked. In this respect, in 2008 the sampled producers kept
around five months of production (43%) but the pressure of the dumped imports
forced them to increase stocks to more than seven months of production
(corresponding to 63% of total yearly production) during the RIP. The
conclusion that the trend of stocks shows an injurious situation is therefore
confirmed.
Table
11
   || 2008 || 2009 || 2010 || RIP 
 Closing stock (sq ft)* || Business confidential data 
 Index (2008=100) || 100 || 116 || 135 || 131 
* Data from questionnaire replies
4.12.      Wages
(46)     The average wage per employee was stable between 2008 and 2009 as well as
between 2010 and the RIP. The sharp increase by 20% between 2009 and 2010 is
due to a significant increase of labour cost by two of the sampled companies
despite the fact that employment has been reduced.
Table
12
   || 2008 || 2009 || 2010 || RIP 
 Annual labour cost per employee ('000 EUR)* || Business confidential data 
 Index (2008=100) || 100 || 100 || 120 || 120 
* Data from questionnaire replies
4.13.      Investments
(47)     The
sampled companies' annual investments in the production of the like product
were predominantly for the maintenance and increased by 21% between 2008 and the RIP. The sharp increase between 2010 and the RIP
is due to the purchase of some equipment by one of the sampled companies in
2011.
Table
13
   || 2008 || 2009 || 2010 || RIP 
 Net investments (EUR)* || Business confidential data 
 Index (2008=100) || 100 || 102 || 72 || 121 
* Data from
questionnaire replies
4.14.      Profitability and return on
investments
(48)     The Union industry was
loss-making throughout the whole period considered. Between 2008 and the RIP,
the losses (both in absolute terms and expressed as percentage of turnover)
more than doubled.
(49)     Similarly, the return on
investments (‘ROI’) was negative throughout the whole period considered, and
worsened by -131 percentage points between 2008 and the RIP.
Table
14
   || 2008 || 2009 || 2010 || RIP 
 Net Profit of EU sales to unrelated customers (% of net sales)* || Business confidential data 
 Index (2008=100) || -100 || -95 || -73 || -203 
 ROI (net profit in % of net book value of investments)* || Business confidential data 
 Index (2008=100) || -100 || -95 || -73 || -231 
* Data from
questionnaire replies
4.15.      Cash flow and ability to
raise capital
(50)     The net cash-flow from
operating activities remained negative throughout the whole period considered,
and worsened by nearly -300 percentage points between 2008 and the RIP.
Table
15
   || 2008 || 2009 || 2010 || RIP 
 Cash flow (EUR)* || Business confidential data 
 Index (2008=100) || -100 || -115 || -77 || -398 
* Data from
questionnaire replies
(51)     There were no indications that the Union industry encountered difficulties
in raising capital.
(c) Impact of dumped imports and other
factors
4.16.      Impact of the dumped imports
(52)     Following the imposition of measures, the Chinese imports decreased
significantly and are still rather limited, corresponding to a market share of
some 4% during the RIP. The price comparison between these imports and Union
industry prices however shows significant undercutting (51.6%). Given that
chamois leather is a standardised product, that the product scope is very
limited and Chinese goods are in terms of quality similar to the European, the
relatively small market share of Chinese imports combined with significant
undercutting points to significant impact those imports have on the situation
of the Union industry.
4.17.      Imports
from other countries
(53)     There are significant imports from India, Turkey and New Zealand as well
as some imports from other countries, which altogether account for a market
share of 46% in the RIP (down from 60% in 2008).
(54)     With regard to imports from
  India, it is noted that their volumes are significant and that they have
increased their market share from 11% in 2008 to 16% in the RIP. At the same
time, the average prices of Indian imports are somewhat below the average
prices of the Union producers. Given the significant volumes and price
differential it is considered that Indian imports are contributing to some
extent to the negative economic situation of the Union industry. At the same
time, it is noted that prices of Indian imports are more than 60% higher than
the dumped Chinese imports. Consequently, it is considered that this limited
impact on the current situation of the Union industry would in all likelihood
not break the causal link between dumped imports and injury in case of the
likely increase in the dumped Chinese imports and further deterioration of the
Union industry's situation resulting therefrom if measures would be repealed.
Table
16
   || 2008 || 2009 || 2010 || RIP 
 Volume of imports from India (`000 sq ft)* || 2,330.00 || 2,123.33 || 4,276.67 || 4,436.67 
 Market share of imports from India* || 11% || 10% || 15% || 16% 
 Average price of imports from India (EUR/sq ft) || 0.79 || 0.82 || 0.66 || 0.75 
* Data from Eurostat and questionnaire
replies
(55)     There are also significant
imports from Turkey, which account for a market share of 10% in the RIP (down
from 18% in 2008). At the same time the average prices of these imports are
much higher than the chamois leather from the PRC and very close to the price
level of the Union industry. Given the declining trend of the imports from
Turkey and their relatively high prices, it is considered that they would not
break the causal link between dumped imports and injury in case of the likely
increase in the dumped Chinese imports and further deterioration of the Union
industry's situation resulting therefrom if measures would be repealed.
Table
17
   || 2008 || 2009 || 2010 || RIP 
 Volume of imports from Turkey (`000 sq ft)* || 4,063.33 || 2,623.33 || 2,933.33 || 2,700.00 
 Market share of imports from Turkey* || 18% || 12% || 10% || 10% 
 Average price of imports from Turkey (EUR/sq ft) || 0.77 || 0.89 || 1.05 || 1.20 
* Data from Eurostat and questionnaire
replies
(56)     There are also significant
imports from New Zealand, which account for a market share of 7% in the RIP and
they have increased from 3% in 2008. However, the average prices of these
imports are much higher than the chamois leather from the PRC and even higher
than the price level of the Union industry. Given the relatively high prices of
imports from New Zealand, it is considered that they, too, would not break the
causal link between dumped imports and injury in case of the likely increase in
the dumped Chinese imports and further deterioration of the Union industry's
situation resulting therefrom if measures would be repealed.
Table
18
   || 2008 || 2009 || 2010 || RIP 
 Volume of imports from New Zealand (`000 sq ft)* || 716.67 || 2,426.67 || 1,966.67 || 1,883.33 
 Market share of imports from New Zealand* || 3% || 11% || 7% || 7% 
 Average price of imports from New Zealand (EUR/sq ft) || 1.29 || 1.43 || 1.43 || 1.48 
* Data from Eurostat and questionnaire
replies
(57)     Imports from the rest of
the world account for a market share of 13% in the RIP (down from 27% in 2008).
At the same time the average prices of these imports are much higher than the
chamois leather from the PRC and are close to the price level of the Union
industry. Given the declining trend of the imports from rest of the world and
their relatively high prices compared to chamois leather imports from the PRC,
it is considered that they, too, would not break the causal link between dumped
imports and injury in case of the likely increase in the dumped Chinese imports
and further deterioration of the Union industry's situation resulting therefrom
in case measures would be repealed.
Table
19
   || 2008 || 2009 || 2010 || RIP 
 Volume of imports from rest of the world (`000 sq ft)* || 5,896.67 || 4,013.33 || 4,480.00 || 3,556.67 
 Market share of imports from rest of the world* || 27% || 18% || 16% || 13% 
 Average price of imports from rest of the world (EUR/sq ft) || 0.63 || 0.84 || 0.81 || 0.84 
* Data from Eurostat and questionnaire
replies
(58)     Imports from all other
third countries taken together account for a market share of 46% in the RIP
(down from 60% in 2008). At the same time the average prices of these imports
are much higher than the chamois leather from the PRC and very close to the
price level of the Union industry. Given the declining trend of the imports
from third countries and their relatively high prices, it is considered that
they, taken as a whole, would also not break the causal link between dumped
imports and injury in case of the likely increase in the dumped Chinese imports
and further deterioration of the Union industry's situation resulting therefrom
if measures would be repealed.
Table
20
   || 2008 || 2009 || 2010 || RIP 
 Volume of imports from other countries (sq ft)* || 13,006.67 || 11,186.67 || 13,656.67 || 12,576.67 
 Index (2008=100) || 100 || 86 || 105 || 97 
 Market share of imports from other countries* || 60% || 51% || 49% || 46% 
   ||   ||   ||   ||   
 Average price of imports from other countries (EUR/sq ft) || 0.74 || 0.98 || 0.91 || 0.98 
5.           Conclusion on the
situation of the Union industry 
(59)     There are only three producers (all of them SMEs) left in the Union. All other chamois leather producers are reported to have closed their manufacturing
sites since 2006 when the original measures were introduced. That can be seen
as developing from the increased pressure that the Chinese dumped imports have
been exercising on the Union market, even in a situation of increasing
consumption.
(60)     The injury analysis shows
that the situation of the Union industry deteriorated in the period considered.
In particular, production dropped by some 12% and even if the sales increased
slightly it was less than the increase in consumption and consequently the
market share of the Union producers decreased by 3 percentage points.
(61)     At the same time the
analysis of microeconomic indicators
show that profitability, return on investment and cash flow of the Union
industry remained negative throughout the period considered and further
deteriorated towards the RIP.
(62)     Imports from India, Turkey, New Zealand and the rest of the world have been analysed. With regard to each of
those imports flows, as well as all of them taken together, it is considered
that they would not break the causal link between dumped imports and injury in
case of the likely increase in the dumped Chinese imports and further deterioration
of the Union industry's situation resulting therefrom in case measures would be
repealed.
(63)     In the light of the
foregoing, it is concluded that the Union industry has continued to suffer
material injury within the meaning of Article 3(5) of the basic Regulation and
that its situation is very fragile and vulnerable and far from the levels that
could be expected had it recovered from the injury found in the original
investigation.
(64)     It is also concluded that
the injurious situation of the Union industry has been predominantly caused by
the continued existence (even if in lower quantities) of the dumped and low
priced imports from the PRC.
E.         LIKELIHOOD OF A
CONTINUATION OF INJURY
1.           Impact of the projected
volume of imports and price effects in case of repeal of measures
(65)     Although the import volumes from the PRC decreased
significantly after the imposition of measures in 2006, it is considered that
there remain significant capacities in the PRC (see recital 22). These spare
capacities may be easily diverted to the Union market in case measures would be
repealed. 
(66)     It is considered that in
case measures would be repealed, the Chinese exporting producers would in all
likelihood strive to regain any lost market share in the Union. Indeed, the
significant undercutting established by the investigation shows that the level
of prices in the Union makes it a very interesting market for the Chinese
imports (see recital 22). 
2.           Conclusion on the
continuation of injury
(67)     On this basis, it is concluded
that the repeal of measures on the imports from the PRC would in all likelihood
result in the continuation of injury to the Union industry.
F.         UNION INTEREST
1.           Introduction
(68)     In accordance with Article
21 of the basic Regulation, it was examined whether the maintenance of the
existing anti-dumping measures would not be against the interest of the Union as a whole. The determination of the Union interest was based on an appreciation of
the various interests involved, i.e. those of the Union industry, on one hand,
and of importers and users on the other hand.
(69)     It should be recalled that,
in the original investigation, the adoption of measures was considered not to
be against the interest of the Union. Furthermore, the fact that the present
investigation is a review, thus analysing a situation in which anti-dumping
measures have already been in place, allows for the assessment of any undue
negative impact on the parties concerned by the current anti-dumping measures. 
(70)     On this basis it was examined
whether, despite the conclusions on the likelihood of a continuation of
injurious dumping, it could be clearly concluded that it would not be in the
Union interest to maintain measures in this particular case. 
2.           Interest of the Union
industry
(71)     The Union industry,
composed by SMEs, has consistently lost market share and has suffered material
injury during the period considered. Should measures be repealed, the Union
industry would in all likelihood be in an even worse situation.
3.           Interest of importers 
(72)     There are two unrelated
importers cooperating in the investigation. The chamois leather related
business constitutes only a limited part of their respective turnovers. There
are no indications that a continuation of measures would have any significant
negative effect on their activities. 
4.           Interest of users and
consumers 
(73)     No user or consumer
associations made themselves known within the time-limit set in the notice of
initiation, which was also the case in the original investigation. Given that
in the original investigation it was considered that the measures in question
would not unduly affect the interest of these parties and considering their
continuous non-cooperation, it can be concluded that their interest will remain
unaffected by the maintenance of the measures. Indeed, the existence of
significant imports from other sources and at competitive prices will ensure
that users and consumers continue to have a wide choice of different suppliers
of the product in question and at reasonable prices.
5.           Conclusion 
(74)     Taking into account all of
the factors outlined above, it is concluded that there are no compelling
reasons against the maintenance of the current anti-dumping measures. 
G.        ANTI-DUMPING MEASURES
(75)     All
parties were informed of the essential facts and considerations on the basis of
which it was intended to recommend that the existing measures be maintained.
They were also granted a period to submit comments subsequent to that
disclosure. The submissions and comments were duly taken into consideration
where warranted. 
(76)     It follows from the above
that, as provided for by Article 11(2) of the basic Regulation, the
anti-dumping measures applicable to imports of chamois leather originating in
the PRC should be maintained. It is recalled that these measures consist of an ad
valorem duty at the level of 58.9%,
HAS ADOPTED THIS REGULATION:
Article 1
1.         A definitive anti-dumping duty
is hereby imposed on imports of chamois leather and
combination chamois leather, whether or not cut to shape, including crust
chamois leather and combination crust chamois leather, currently
falling within CN codes 4114 10 10 and 4114 10 90 and
originating in the People’s Republic of China.
2.         The rate of the definitive
anti-dumping duty applicable to the net, free-at-Union-frontier price, before
duty, for the products described in paragraph 1 shall be 58.9%.
3.         Unless otherwise specified, the
provisions in force concerning customs duties shall apply.
Article 2
This Regulation shall enter into force on
the day following that of its publication in the Official Journal of the
European Union.
This Regulation shall be binding
in its entirety and directly applicable in all Member States.
Done at Brussels, 
                                                                       For
the Council
                                                                       The
President
[1]               OJ L 343, 22.12.2009, p. 51.
[2]               OJ L 251, 14.9.2006, p. 1.
[3]               OJ C 19, 20.1.2011, p. 9.
[4]               OJ C 270, 13.9.2011, p. 6.