CELEX: 51983PC0560
Language: en
Date: 1983-09-19
Title: Proposal for a COUNCIL REGULATION (EEC) amending Regulation (EEC) No 191/80 imposing a definitive anti-dumping duty on imports of lithium hydroxide originating in the United States of America and the Soviet Union (submitted to the Council by the Commission)

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COM (83) 560
Vol. 1983/0212
 ---pagebreak--- Disclaimer
Conformément au règlement (CEE, Euratom) n° 354/83 du Conseil du 1er février 1983
concernant l'ouverture au public des archives historiques de la Communauté économique
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In accordance with Council Regulation (EEC, Euratom) No 354/83 of 1 February 1983
concerning the opening to the public of the historical archives of the European Economic
Community and the European Atomic Energy Community (OJ L 43, 15.2.1983, p. 1), as
amended by Regulation (EC, Euratom) No 1700/2003 of 22 September 2003 (OJ L 243,
27.9.2003, p. 1), this file is open to the public. Where necessary, classified documents in this
file have been declassified in conformity with Article 5 of the aforementioned regulation.
In Übereinstimmung mit der Verordnung (EWG, Euratom) Nr. 354/83 des Rates vom 1.
Februar 1983 über die Freigabe der historischen Archive der Europäischen
Wirtschaftsgemeinschaft und der Europäischen Atomgemeinschaft (ABI. L 43 vom 15.2.1983,
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(ABI. L 243 vom 27.9.2003, S. 1), ist diese Datei der Öffentlichkeit zugänglich. Soweit
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 ---pagebreak--- COMMISSION OF THE EUROPEAN COMMUNITIES
                                                     COM (83) 560 final
                                                     Brussels, 19 September 1983
                                         Proposal for a
                                    COUNCIL REGULATION (EEC)
           amending R e g u l a t i o n (EEC) No 191/80 imposing a definitive
         ant i-d u m p i n g duty on imports of lithium h y d r o x i d e originating
               in the United States of America and the Soviet Union
                       (submitted to the Council by the Commission)
 COM (83) 560 final
 ---pagebreak---                                      EXPLANATORY MEMORANDUM
1. In J a n uary 1980 a d e f i n i t i v e ant i-dum ping duty was imposed by Regulation
   (EEC) No 191/80 on imports of lithium hydroxide originat ing in the
   Uni ted States of America and the Soviet Union.                This duty was subsequently
   ame nded on 28 August 1980 by Reg ulati on (EEC) No 2294/80 which fixed the
   new rate as being the amount by which the price per p o u n d , free at
   Com munit y frontier, before duty, is less than US$1.66.
   2.   In April 1983, fol lowing a complaint received from CEFIC, the European
   Council of Chemical Industry Federations, acting on behalf of the sole
   Com munit y producer, the Com missi on commenced a review of the definiti ve
   duty and of the undertaking given by one of the American exporters. A notice to this
   effect was published in Official Journal of the European Communities No C 98 of 12 April 1983.
   3.   The review d i s c l o s e d renewed dumping in respect of imports, the margins
   being 15.5% for the United States and 12% for the Soviet Union.                          Whilst
   imports from these two cou ntries have d e c r e a s e d since the imposition of
   the d e f i n i t i v e duty from 1 139 tonnes in 1980 to 702 tonnes in 1982 the
   market share of 45.8% o b t a i n e d by these imports makes them the dominant
   force in the Com munit y market.             The resale prices of the dumped imports has
   been a p p r o x i m a t e l y 15% lower than that required to cover the costs of the
   sole C o m m unit y p r o d u c e r who has, as a result, incurred heavy losses which
   raise doubts as to the con ti n u a t i o n of pro duction.
   4.   As a result of the review it is con sider ed that the continued a p p l i c a ­
   tion of the d e f n itiv e duty                       and the m a i n t e n a n c e of price u n d e r ­
   takings was req uired to e l i m inat e injury and prevent its recurrence.                      In
   view of the renewed d u m ping which has taken place as a result of the
   increase in the A m e rican domestic price and the consequent injury it is
   very p r o b a b l e that injury to the Community industry will again result if
   the defi litive duty is not increased and the u n d e r t a k i n g s are not increased
   to a hig her l e v e l .
   5.   Both the Ame rican e x p o rter s known to be con cerne d have o f f ered s a t i s ­
   factory price u n d e r t a k i n g s which est ablish a m i n imum price of US$ 1.80 per lb
   at the C o m m unit y frontier.         The Soviet e x p orter has not p a r t i c i p a t e d in the
 ---pagebreak---                                  - 2 -
review and it is p r o posed t h e r efor e that the d e f i n i t i v e duty concerni ng
imports from the Soviet Uni on and the Uni ted States of Lithium hyd roxide
be adj usted so as to equal the amount by which the price per pound,,
free at Com munit y fro ntier, before dut y,is           Less than U S $ 1 . 8 0 and that
those US exp orter s who have given u n d e r t a k i n g s be e x c luded from the duty.
 ---pagebreak---                                       Proposal for a
                                  COUNCIL REGULATION (EEC)
 ame nding R e g u l a t i o n (EEC) No 191/80 imposing a d e f initi ve a n t i-dum ping duty on
 imports of lithium h y d r oxid e ori gi n a t i n g in the Uni t e d S t a t e s of America and
 the Soviet Union
 THE COUNCIL OF THE EUROPEAN COMMUNITIES,
 Having regard to the Treaty est abl i s h i n g the Eur opean Economic Community,
 Having regard to Council R e g ulati on (EEC) No 3017/79 of 20 December 1979
 on p r o t e c t i o n against d u m p e d or sub sidiz ed imports from countries not
                                                              1
 mem bers of the E u r o p e a n Economic Community , as amended by Regulation (EEC)
 No 158 0/82^, and in p a r t i c u l a r Art icles 12 and 14 thereof,
 Hav ing regard to the pro posal sub mitte d by the Com missi on after consultation
within the A d v i s o r y C o m m itte e as p r o vided for under the above Regulation,
Whereas,
A.      PRIOR A CT ION             ■
1.      By its R e g u l a t i o n (EEC) No 1 9 1 /80^ the Council imposed a def initi ve
a n t i - d u m p i n g duty on imports of lithium h y d r oxid e falling within Common Customs
Tariff s u b headi ng 28.28 B, cor re s p o n d i n g to Nim exe code ex 28.28-10, ori gi n a t i n g
in the U ni ted States of America and the Soviet Union.
2.      Whereas that R e g u l a t i o n was sub se q u e n t l y a m e nded by R eg ulati on (EEC)
                    4
No 2 2 9 4/80 which c h a nged the amount of duty to the amounl by which the
free at Com munit y fro ntier price of lithium hyd roxid e is less than
US$1 66 per l b .
1 0J No L 339, 3 1 . 12.19 79, p.            1.
20J No L 178, 22.06.19 82, p.                9.
3 0J No L           23, 3 0. 01.19 80, p. 19.
4 0J No L 228, 30.08.19 80, p. 59.
 ---pagebreak---                                                 - 2 -
B.      REVIEW P R O C E D U R E
3.      The Com missi on has since received a complaint from CEFIC, the European
Council of Chemical Industry Federations, acting on behalf of the sole
Com munit y pro ducer of lithium hydroxide, requesting the review of the
d e f i n i t i v e a n t i - d u m p i n g dut y and the price u n d e r t a k i n g giv en by one of the
Ame rican exporters.
4.      Since the said request pro vided suf ficie nt e v i d e n c e to justify opening
a review pro cedur e, the C o m m i s s i o n a n n o unce d by a not ice p u b l i s h e d in the
Official Journal of the E u r opean C o m munit ies                   a review of the d e f i n i t i v e
ant i-d u m p i n g duty on imports of lithium h y d r o x i d e o r i g i n a t i n g in the
United States of Ame rica and the Soviet Union and c o m m ence d an investigation.
5.      The Com missi on o f f i c i a l l y so a d v ised the e x p o r t e r s and imp orters known
to be con cerned as well as the r e p r e s e n t a t i v e s of the U ni ted States and
 the complain ants, and have given the par ties d i r e c t l y                       c o n c e r n e d the
 opp or t u n i t y to make known their views in w r i t i n g and to request a hearing.
 Both of the Ame rican e x p o r t e r s took this o p p o r t u n i t y to make their views
 known in wri ting and were g r a n t e d hearings.
 6.      Most of the importers mad e their views known in w r i t i n g and some
 importers were g r a nted hearings.
 7.      The Com mi s s i o n sought and v e r i f i e d all i n f o r m a t i o n it d e e m e d to be
 n e c e ssar y for the p u r p o s e s of the review p r o c e d u r e ; it c a r ried out
 inv est i g a t i o n s at the p r e m i s e s of the following:
 Com munity producer:
 Chemetall GmbH, Frankfur t, Federal Rep ublic of G e r many
 Exporters:
  Foote Mineral Company, Exton, P e n n s y l v a n i a , USA
 Lit hium C o r p o r a t i o n of A m e r i c a , G a s t onia , North Car olina, USA
 5 OJ No C          98, 1 2. 04.19 83, p.           2.
 ---pagebreak---                                            - 3 -
Importer:
Lithi um Cor po ra t io n of Europe Ltd, Bromb oro ugh, United Kingdom.
8.     The enqui ry into dumpi ng covered the year ended 31 March 1983.
c.     NO RM AL VALUE
9.     Normal value for Amer ican exporters was de t er mi n ed on the basis of the
dome stic prices of those prod ucer s who expo rted to the EEC.
10.     In order to esta blis h wheth er the imports from the Soviet Union were
dumped, the Comm is si on had to take account of the fact that the Soviet
Union does not have a market economy and the Co mm issi on the refore had to
base its d e t e r m i n a t i o n on the normal value in a market economy country;
in this con ne ct i on the com plainant had sug gest ed the United States' domestic
market, this being the only known non-EEC market economy country which produces
the like product.            No o b j e ct io n was made to this suggesti on and the
Comm is si on is sa t is fie d that there is sufficient internal com petition in
the Un it ed States to ensure that price levels are in a reasonable proportion
to pr o du ct i on costs;                it is,       th er e f o r e ,
  co n si de r ed        ap p r o p r i a t e and not u n r e a so n ab le to de t er mi n e normal
value for imports or i g i n a t i n g in the Soviet Union on the basis of domestic
prices in the Un it ed States.
 D.     EXPORT PRICE
11.     Export prices for Amer ic an exp orters were de te r m i n e d on the basis of
the prices ac t uall y paid or pa y able for the prod ucts sold for export to the
Communit; .       With regard to exports from the Soviet Union, no information
was p ro vi de d to the Co m mi ss i on by the expo rter s or importers concerni ng
export prices and these were con seq ue nt ly d e t e rm in ed on the basis of the
data prov id ed in the com plaint which was con side re d to be the best inf or­
ma ti on available.
 ---pagebreak---                                             - 4 -
 E.    COM PARIS ON
12.     In com paring normal val ue with export prices, the C o m m i s s i o n took
account, where a p p ropri ate, of d i f feren ces aff ectin g price com pa r a b i l i t y
and, in p ar ticul ar, of d i f f e r e n c e s in conditions and terms of sale.                  All
comparis ons were made at e x - works level.
F.     MARGINS
13.     The above e x a m i n a t i o n of the facts showed that the A m e r i c a n exp orter
which had given an u n d e r t a k i n g after the original inv es t i g a t i o n had respected
the terms of its u n d e r t a k i n g but that, in some cases, the increases in the
prices on the U ni ted States dom estic market had led to a res umpti on of
dumping.      For this e x p o r t e r and for the oth er e x p o r t e r s c o n c e r n e d the
w e i ghted average m a r gin of dum ping, which is equal to the amount by which
the normal value as e s t a b l i s h e d exc eeds the price for export to the Community,
was as follows:
Exports from the USA                              15 5%
Exports from the USSR                             12.0%
G.      INJURY
14.     Statisti cal e v i d e n c e a v a i l a b l e to the C o m m i s s i o n shows that imports
into the Com munit y from the Soviet Union and the U ni ted States d e c r ease d
from 1 139 tonnes in 1980 to 702 tonnes in 1982 and the market share obtained
by these imports d e c r e a s e d from 54 9% to 45 8% d u r i n g the same period.
15.     The w e i g h t e d a v e r a g e resale prices of the d u m p e d imports in the
Com munity were a p p r o x i m a t e l y 15% lower than tho se req uired to cover the
costs of the sole C o m m u n i t y p r o d u c e r and p r o v i d e a r ea sonab le profit.         The
resultant impact on this p r o d u c e r has been the i n c u rrin g of a c o n sider able
 loss which puts into j e o p a r d y the c o n t i n u a t i o n of the p r o d u c t i o n of this
product.
 16.    The C om missi on has c o n s i d e r e d w h e t h e r injury has been c au sed by other
 factors.      In this c o n n e c t i o n it has taken into acc ount the imports of
 lithium hyd roxid e o r i g i n a t i n g in the P e o ple's Rep ublic of Chinq, which are
 ---pagebreak---                                             - 5 -
the subject of an an t i- du m pi ng proceeding which was initiated at the same                        o*
time as the review pr o ce dur e .
 17.      Whilst du mp ed imports of this product from China have increased sub­
 stan ti al ly be tw een 1980 and 1982 and have been at prices which were even
 lower than those of Amer ican and Soviet origin, the market share of 25.5%
o bt ai ne d by Chinese exports in the Com munity is far inferior to the 45%
o bt ai ne d by the other expo rter s concerned who must thus be considered to
have a domi nant posi ti on in the EEC market.                      For this reason the Commission
has been led to ma i ntai n its view that the con tinued app lic at io n of the
a n t i - du m pi ng duty and the ma i nt en a nc e of price und er ta k in gs was a requir e­
ment for the e l i m i na t io n of injury and the prev en ti on of its recurrence.
The renewal of du mp ing and consequent injury show that if the definiti ve
duty is not inc reased and the und er ta k in gs are not                         increased to a higher
 lev el,material injury to the Com munity industry con cerned would result.
H.       COM MUNITY INTEREST
18.      Co m mu nit y p r o c e s s i n g industries have argued that the con tinuation of
pr ot e c t i v e me a su re s wo ul d not be in the Comm unit y interest because it would
adve rsel y affect the co m pe ti t iv e po s it io n on e x t r a- Co mm un i ty markets.          In
view o f ^ p i r t i c u l a r l y serious d if fi cu l ti es facing the only Community producer,
its str ategic imp orta nc e and the relatively low inc idence of a price
increase on the costs of the pro ce ss i ng industry the Council has nev ertheless
  come to. the co nc lusi on that it is in the Communi ty 's interest that d e f i ­
 nitive meas ur es be cont inue d in respect of lithium hydr oxid e or ig inat ing
 in the Soviet Union and the United States.
I.       U N D E R TA K IN GS
19.      The A me ri ca n ex p or ter s co n ce rne d were informed of the main findings of
the review and comm ente d on them.                 Foote Mineral Company, which had offere d
an u n d e r ta k in g in the original p r o c e e d i n g , v o l u n t e e r e d to renew it at a
level co n si de r ed ne c es sar y to prevent renewed injury to the Com munity
 ---pagebreak---                                             - 6 -
  industry.       The L i t hium C o r p o r a t i o n of America also v o l u n t a r i l y und ertook
  to respect a m i n imum price for its exports.                            The effect of these u n d e r ­
  takings will be to m a i n t a i n the import prices at the level n e c e s s a r y to
  prevent injury.          In no case do the prices in these u n d e r t a k i n g s exceed the
  dumping mar gins found.             The Council has the refor e d e t e r m i n e d that imports
  of lithium hyd roxid e e x p o r t e d by the Foote Mineral Company and the Lit hium
  Cor poration of America             s ho uld be e x c luded from the duty.
 J.       INCREASE IN RATE OF DEFINITIVE DUTY
 20.       In the light of the fin dings of the review, the d e f i n i t i v e duty imposed
 by Regulati on (EEC) No 1 9 1 /80 and s u b s e q u e n t l y a m e nded by R e g u l a t i o n (EEC)
 No 229 4/80 should be a d j u s t e d so as to fix a new free at C o m m unit y frontier
 min imum price before duty of US$1 80 per lb in pla ce of the former price
 of US$1 66 per l b .
 HAS ADOPTED       THIS REGULATION:
                                            Art icle 1
 Article 1(1), (3) and (5) of R e g ulati on (EEC) No 191 /80 is hereby re­
  placed by the       following:
"1. A definitive anti-dumping duty is hereby imposed on imports of lithium hydroxide
   falling within Common Customs Tariff s u b h e a d i n g 28.28 B and c o r r e s p o n d i n g
   to Nimexe code ex 28.28-10, originating                        in the U ni ted Sta tes of Ame rica and
   the Soviet Union.            This dut y shall not a pp ly to lithium h y d r o x i d e m a n u ­
   factured and exported by Foote Mineral Company, USA and the L i t h i u m .
   C o r porat ion of America, USA.
   The provisio ns in force c o n c e r n i n g customs dut ies shall app ly to this
  duty."
  "3.       For the purposes of this Reg ula t i o n , the normal value of lithium
    hyd roxide o r i g i n a t i n g in the U n i ted States of A m e rica and the Soviet Union,
    a d j usted to a f r e e ~ a t _ C o m m u n i t y ~ f r o n t i e r basis, b ef ore duty, shall be
    US$1 80 per lb."
 ---pagebreak---                                      - 7 -
 "5. a) Where the product defined in paragraph 1 is not released for c o n ­
          sum ption on the basis of the price to the first pur chase r in the
          Com munit y, the d e f i n i t i v e a n t i-dum ping duty shall be at the f ol low­
          ing rates:
          - 15 5% of the normal value of US$1 80 per lb for imports o r i g i n a ­
              ting in the United States of America,
          - 12% of the normal value of U S $ 1.80 per lb for imports ori ginating
              in the Soviet Union.
     b) Where, however, the d e c l a r i n g party can pro vide sat isfac tory proof
          to the customs aut ho r i t i e s that the price paid by the first purchaser
            i) e x c eeds or is equal to the normal value of US$1 80 per lb, no
                 duty shall be applied, or
          ii) is lower than the normal value of US$1 80 per lb by less than
                 15 5% for imports o r i g i n a t i n g in the Uni ted States of America,
                 or by less than 12% for imports o r i g i n a t i n g in the Soviet Union,
                 the duty shall be equal to the amount by which the said price
                 is lower than the normal value.".
                                    A r t icle 2
This R e g u l a t i o n shall enter into force on the day fol lowin g its publicat ion
in the Off icial Journal of the European Communities.
This R e g ulati on shall be b i n ding in its e n t irety and d i r e c t l y applicab le
in all M em ber States.
 Done at                                                         For the council,