CELEX: 51996PC0334
Language: en
Date: 1996-07-10
Title: Proposal for a COUNCIL REGULATION (EC) amending Council Regulation (EEC) No 54/93 imposing a definitive anti- dumping duty on imports of synthetic fibres of polyesters originating in India and the Republic of Korea

COMMISSION OF THE EUROPEAN COMMUNITIES
                                                  Brussels, 10.07.1996
                                                   COM(96) 334 final
                                   Proposal for a
                         COUNCIL REGULATION (EC)
amending Council Regulation (EEC) No 54/93 imposing a definitive anti-dumping
  duty on imports of synthetic fibres of polyesters originating in India and the
                               Republic of Korea
                          (presented by the Commission)
 ---pagebreak---  ---pagebreak---                         EXPLANATORY MEMORANDUM
1. The Council, by Regulation (EEC) 54/93, imposed a definitive anti-dumping duty
   on imports of synthetic fibres of polyesters originating, inter alia, in India. This
   regulation established a residual duty of 7.2% which is applicable to exporters not
   co-operating or not known when the original investigation took place.
2. Pursuant to Article 11(4) of the Basic Anti-Dumping Regulation, each new exporter
   has the right to request that an individual duty calculation be carried out in its
   regard. The Commission received such an application from the Indian company
   Bongaigaon Refinery & Petrochemicals Ltd (hereafter 'Bongaigaon') which claimed
   that it was a new exporter.
3. Subsequently, the Commission, by Regulation (EC) No 2566/95, initiated a review
   proceeding with regard to Bongaigaon, repealed the anti-dumping duty imposed on
   imports of the product concerned manufactured by this company and directed
   customs authorities to register such imports. The investigation was limited to the
   examination of the situation of Bongaigaon as no request for a review of the injury
   findings had been received.
4. The dumping margin found amounted to 17.5% and the injury margin amounted to
    13.0%. As the dumping margin was higher than the injury margin, the level of the
   duty was based on the latter.
5. The current review led to the particularity that the individual "newcomer" duty rate
   was higher than the residual duty initially established. The principle that a review
   requested by an interested party may lead to a result less favourable to that party
   than the status quo ante has however consistently been applied in other cases.
   Consequently, it is proposed that:
   a)      an individual anti-dumping duty of 13.0% be imposed on Bongaigaon and
   b)      the anti-dumping duty at this rate be collected retroactively on imports from
           Bongaigaon which were subject to registration.
                                              1/
 ---pagebreak---                          COUNCIL REGULATION (EC)
 amending Council Regulation (EEC) No 54/93 imposing a definitive anti-dumping
    duty on imports of synthetic fibres of polyesters originating in India and the
                                   Republic of Korea
     THE COUNCIL OF THE EUROPEAN UNION,
     Having regard to the Treaty establishing the European Community,
     Having regard to Council Regulation (EC) No 384/96 of 22 December 1995 on
     protection against dumped imports from countries not members of the European
     Community^), and in particular Article 11 (4) thereof,
     Having regard to the proposal submitted by the Commission after consultating the
     Advisory Committee,
     Whereas :
                             A. PREVIOUS PROCEDURE                    „
(1)   By Regulation (EEC) No 54/93(2), the Council imposed, inter alia, a definitive
      anti-dumping duty of 7.2% on imports of synthetic staple fibres of polyesters, not
      carded, combed or otherwise processed for spinning, commonly referred to as
      polyester synthetic fibres, currently classifiable within CN code 5503 20 00 and
      originating in India, with the exception of imports from five Indian exporters
      specifically mentioned which were either subject to a lesser rate of duty or no
      duty at all.
0)    OJNoL 56, 06.03.1996, p. 1.
(2)   OJNoL 9, 15.01.1993, p. 2.                    Z
 ---pagebreak---                                    B. PROCEDURE
(2) The Commission received an application for a review of the measures currently
     in force from the Indian company Bongaigaon Refinery & Petrochemicals Ltd.
    (hereafter 'Bongaigaon' or 'the company1). Bongaigaon claimed that it was not
    related to any of the exporters or producers in India which are subject to the anti-
    dumping measures on the product, and that it had not exported the product during
    the period of investigation on which the measures are based. Furthermore, the
    company claimed that it had actually exported the product concerned to the
    Community and that it had also entered into irrevocable contractual obligations to
    export significant quantities to the Community.
(3) Bongaigaon provided, on request, evidence which was considered sufficient to
    justify the initiation of a review in accordance with the provisions of Article
     11(4) of Regulation (EC) No 384/96 (hereafter referred to as the 'Basic
    Regulation'). By Regulation (EC) No 2566/95(3), the Commission, after
    consultating the Advisory Committee, initiated a review of Regulation (EEC) No
     54/93 with regard to Bongaigaon and commenced its investigation.
    By Regulation (EC) No 2566/95, the Commission also repealed the anti-dumping
    duty imposed by Regulation (EEC) No 54/93 with regard to imports of the
    product concerned produced and exported to the Community by Bongaigaon and
     directed customs authorities, pursuant to Article 14(5) of the Basic Regulation, to
     take appropriate steps to register such imports.
(3)  OJNoL 262, 01.11.1995, p. 28.
                                                  ^
 ---pagebreak--- (4) The product concerned in this review is the same as the one under consideration
    in Regulation (EEC) No 54/93.
(5) The Commission officially advised Bongaigaon and the representatives of the
    exporting country. Furthermore, it gave the parties directly concerned the
    opportunity to make their views known in writing and to request a hearing but
    did not receive any reaction in this respect.
    The Commission sent a questionnaire to Bongaigaon and received a proper and
    timely reply. The Commission sought and verified all information it deemed
    necessary for the purposes of the procedure and carried out a verification visit at
    the premises of Bongaigaon, India.
(6) The investigation of dumping covered the period from 1 July 1994 to 30 June
    1995.
(7) The same methodology as that used in the original investigation was applied
    where circumstances had not changed.
                    C. RESULTS OF THE INVESTIGATION
    1. New exporter qualification
(8) The investigation confirmed that Bongaigaon had not exported the product
    concerned during the period of investigation on which the measures subject to
    review are based, i.e. from 1 January 1990 to 31 August 1990. Exports of the
    product concerned to the Community started, in fact, only during the company's
    financial year 1993/94.
                                              5
 ---pagebreak---    In addition, it was found that Bongaigaon had no links, either direct or indirect,
   with the exporters involved in the previous procedure.
   Accordingly, it is confirmed that the company should be considered as a new
   exporter in the sense of Article 11(4) of the Basic Regulation and that its
   individual dumping margin should be determined.
   2. Dumping
   i) Normal value
9) Although the company's total domestic sales of the like product constituted more
   than 5 % of the volume of export sales to the Community it was found that for the
   product type sold to the Community the domestic sales volume for the
   corresponding type was below this threshold and the prices could not be
   considered representative for the market concerned.
   As the company has produced and sold on the domestic market, in the ordinary
   course of trade, other types of the like product than the one exported to the
   Community, normal value was constructed in accordance with Article 2(3) and
   the first sentence of Article 2(6) of the Basic Regulation. Consequently, normal
   value was calculated on the basis of all costs of production incurred by
   Bongaigaon when producing the product type in question plus a reasonable
   amount for selling, general and administrative expenses and profits, both
   established on the basis of the company's domestic sales of all types of the like
   product in the ordinary course of trade.
                                             £>
 ---pagebreak---      ii) Export price
(10) Export sales of the product concerned were made directly to unrelated importers
     in the Community. Export prices were therefore determined on the basis of the
     prices actually paid by these unrelated importers, in accordance with Article 2(8)
     of the Basic Regulation.
     in) Comparison
(11) For the purpose of a fair comparison between normal value and export price,
     account was taken of differences affecting price comparability as provided for in
     Article 2(10) of the Basic Regulation, namely import charges and indirect taxes,
     discounts, transport and insurance expenses, commission and credit costs. The
     comparison was made at an ex-works level.
(12) Bongaigaon requested that adjustments should be made for the following benefits
     received for its export performance but not granted in respect of its domestic
     sales:
            Reduction of Corporate Tax due to export sales based on
            the Indian Income Tax Act,
            Benefit for an Export House,
            Market Development Assistance following the Federation
            of Indian Export Organizations Scheme.
     The claim was rejected as Bongaigaon could not demonstrate that these benefits,
     which accrued to the company only after the investigation period and which
     resulted in a reduction of its selling, general and administrative expenses, had any
     direct and measurable effect on prices and price comparability in the sense of
     Article 2(10) of the Basic Regulation.
                                                +
 ---pagebreak---      iv) Dumping margin
(13) The comparison showed the existence of dumping with respect to the synthetic
     fibres of polyesters exported by Bongaigaon. The dumping margin, being equal
     to the amount by which normal value exceeded the price for export to the
     Community, was established on the basis of a comparison of the constructed
     normal value as defined in recital (9) with the weighted average of prices for all
     export transactions of the product concerned to the Community during the period
     mentioned in recital (6). Expressed as a percentage of the free-at-Community-
     frontier price, the dumping margin amounted to 17.5%.
     3. Injury
(14) No request for a review of the findings on injury was made and there is no reason
     to doubt that the level of injury found in the original investigation has not
     decreased.
          D. AMENDMENT OF THE MEASURES BEING REVIEWED
(15) In accordance with Article 9(4) of the Basic Regulation, the amount of the anti-
     dumping duty should not exceed the dumping margin established and should be
     less if a lesser duty would be adequate to remove the injury to the Community
     industry.
                                               %
 ---pagebreak--- (16) In the present case, the dumping margin established exceeds the injury margin,
     The latter was calculated by applying the same methodology as in the original
     investigation. This methodology is described in detail in recitals (50) to (54) of
     Regulation (EEC) No 1956/92(4). The injury margin found amounted to 13.0%.
     The anti-dumping duty to be imposed should therefore correspond to the injury
     margin established and Council Regulation (EEC) No 54/93 should be amended
     accordingly.
        E. RETROACTIVE LEVYING OF THE ANTI-DUMPING DUTY
(17) As the review has resulted in a determination of dumping in respect of
     Bongaigaon, the anti-dumping duty applicable to this company shall also be
     levied retroactively up to the date of the initiation of the review against imports
     which, pursuant to Article 3 of Regulation (EC) No 2566/95, have been subject
     to registration.
               F. DISCLOSURE AND DURATION OF MEASURES
(18) Bongaigaon was informed of the facts and considerations on the basis of which it
     was intended to propose the amendment of Regulation (EEC) No 54/93 and were
     given an opportunity to comment. The Commission also officially advised the
     complainants mentioned in the initial investigation.
(4)  OJ No L 1*7, lé. 07.1992, p. 25.
 ---pagebreak---      Bongaigaon made their views known in writing. They requested that the rate of
     profit should not be based on the domestic sales of all types of the like product
     made in the ordinary course of trade. They also repeated their claim for
      adjustments concerning
            the Reduction of Corporate Tax due to export sales based on the Indian
            Income Tax Act and
            Benefit for an Export House.
      These requests had to be rejected for the reasons set out in recitals 9 and 12.
(19) This review does not affect the date on which Regulation (EEC) No 54/93 will
      expire pursuant to Article 11(2) of the Basic Regulation.
HAS ADOPTED THIS REGULATION :
                                           Article 1
     Article 1(2) of Regulation (EEC) No 54/93 is hereby amended as follows:
     under (a) the following shall be added at the end of the text:
             " Bongaigaon Refinery & Petrochemicals Ltd.
                  13,0% (Taric additional code: 8873);"
                                        J.C
 ---pagebreak---                                      Article 2
The anti-dumping duty shall also be levied retroactively up to the date of the
initiation of the review against those imports, which, pursuant to Article 3 of
Regulation (EC) No 2566/95, have been subject to registration.
                                     Article 3
This Regulation shall enter into force on the day following its publication in the
Official Journal of the European Communities.
This Regulation shall be binding in its entirety and directly applicable in all
Member States.
Done at Brussels,
                                                            For the Council
                                  ^1-1
 ---pagebreak---  ---pagebreak---                                                                   ISSN 0254-1475
                                                                            «1*4
                                                           COM(96) 334 final
                                              DOCUMENTS
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                                                             ISBN 92-78-06062-3
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