CELEX: 51997PC0440
Language: en
Date: 1997-09-03
Title: Proposal for a Council Regulation (EC) imposing a definitive anti-dumping duty on imports of unwrought, unalloyed zinc originating in Poland and Russia and definitively collecting the provisional duty imposed

COMMISSION OF THE EUROPEAN COMMUNITIES
                                               Brussels, 03.09.1997
                                               COM(97)440 final
                                Proposal for a
                      COUNCIL REGULATION (EC)
imposing a definitive anti-dumping duty on imports of unwrought, unalloyed
    zinc originating in Poland and Russia and definitively collecting the
                           provisional duty imposed
                       (presented by the Commission)
 ---pagebreak---  ---pagebreak---                       EXPLANATORY MEMORANDUM
1. Attached is a proposal for a Council Regulation imposing definitive anti-
   dumping duties on imports of unwrought, unalloyed zinc originating in Poland
   and Russia. The proposed regulation also makes provision for the definitive
   collection of the, provisional anti-dumping duty imposed by Commission
   Regulation (EC) No 593/97 of 25 March 1997 (*).
2. This proposal should be assessed together with a Commission Decision
   accepting the undertakings offered by two Polish exporters which co-operated in
   the investigation.
3. The proposed act basically confirms the provisional findings of the Commission
   as regards issues such as the like product, dumping, injury, causation and
   Community interest. Some of these findings, however, have been slightly
   adjusted, in particular the price undercutting calculation and the dumping
   calculation. As a result, the definitive duties will be somewhat lower than the
   provisional ones.
4. Commission Regulation (EC) No 593/97 imposed a provisional duty for a
   period of six months and entered into force on 5 April 1997. Definitive
   measures should therefore be adopted and published before the provisional
   duties would lapse, i.e. not later than 4 October 1997.
     OJ No L 89, 4. 4. 1997, p. 6
 ---pagebreak---                       COUNCIL REGULATION (EC) No                  /97
                                          of           1997
  imposing a definitive anti-dumping duty on imports of unwrought, unalloyed
        zinc originating in Poland and Russia and definitively collecting the
                                      provisional duty imposed
THE COUNCIL OF THE EUROPEAN UNION,
Having regard to the Treaty establishing the European Community,
Having regard to Council Regulation (EC) No 384/96 of 22 December 1995 on
protection against dumped imports from countries not members of the European
Community (*), as amended by Regulation (EC) No 2331/96 (2), and in particular
Articles 8, 9 and 23 thereof,
Having regard to the proposal submitted by the Commission after consulting the
Advisory Committee,
Whereas:
                                A. PROVISIONAL MEASURES
1. By means of Commission Regulation (EC) No 593/97 ( ), hereinafter referred to as
   'the provisional duty Regulation', a provisional anti-dumping duty was imposed on
   imports of unwrought, unalloyed zinc falling within CN codes 7901 11 00, 7901 12
   10 and 7901 12 30, originating in Poland and Russia.
        O J N o L 5 6 , 6. 3. 1996, p. 1.
        OJNoL317, 6. 12. 1996, p. 1.
         O J N o L 8 9 , 04.04.1997, p. 6
 ---pagebreak---                           B. SUBSEQUENT PROCEDURE
2. All interested parties co-operating in the investigation, the complainant and the
    Polish and Russian authorities, received disclosure in writing concerning the
    essential facts and considerations on the basis of which provisional measures were
    imposed.            ,
3. Within the time limits set in the provisional duty Regulation, the Polish
    government, the two co-operating Polish producers/exporters listed in the
    provisional duty Regulation, hereinafter referred to as "the exporters",* as well as
    two importers, have submitted comments in writing.
4. All parties which so requested were granted an opportunity to be heard by the
    Commission services.
        C. PRODUCT UNDER CONSIDERATION AND LIKE PRODUCT
5. The Polish government, the co-operating Polish exporters and an importer of zinc
   originating in Russia raised the question whether their product and the products of
   the European producers could be considered one like product, given certain
   differences in physical characteristics and the fact that they fall within three
   different CN codes.
6. ÎAS laid down in recitals (9) to (15) of the provisional duty Regulation all grades of
   unwrought, unalloyed zinc closely resemble each other. The grades are alike as far
   as their technical and physical characteristics (minimum content of zinc for all
    grades: 98.5 %) and their main uses (e.g. brass industry) are concerned. In addition,
    prices for all grades are based on the LME quotations for Special High Grade
    (SHG) zinc which indicates that they are considered as one like product by the
    market.
 ---pagebreak--- 7. The existence of limited differences in the zinc content (Special High Grade
   (SHG), High Grade (HG), Good Ordinary Brand (GOB)) and in the impurities (in
   particular cadmium), between zinc produced by Community producers and Polish
   zinc, which was invoked by the exporters, does not invalidate this finding, as both
   HG and GOB zinc - which are manufactured by the exporters - and SHG zinc
   manufactured by the Community industry, compete directly in the market segment
   where they are used (hot-dip galvanising, production of brass, production of alloys
   other than casting alloys). It should also be noted that a sizeable proportion of the
   zinc produced by the Community industry is GOB zinc and therefore competes
   directly with Polish GOB and HG zinc as well as with SHG zinc produced by the
   Community industry.
8. The provisional findings laid down in recitals (9) to (15) of the provisional duty
   regulation are therefore confirmed.
                                     D. DUMPING
                                       a) Poland
9. Whereas the methodology used to calculate the dumping margins was not
   challenged in general, the Polish co-operating companies raised some specific
   questions concerning cost of production, the ordinary course of trade test and
   adjustments.
                                                                                       m
 ---pagebreak---                                     (i) Normal Value
                                  a) Cost of production
lO.One Polish company requested some changes in the calculation of its production
   costs for the purpose of establishing normal value. The company claimed, in
   particular, that the costs and/or revenues relating to certain by-products were not
   excluded from the calculation of the production cost for zinc while this should
   allegedly have been done. This claim for correction could not be granted since the
   calculation of the production costs was based on the data provided by the company
   in the questionnaire response and duly verified during the on-spot verification. In
   addition and more generally, it should be noted that for the purpose of an anti-
   dumping proceeding the cost of production as recorded in the company's ledgers
   will, normally, be the basis for the determinations in accordance with Article 2 (5)
   of the Basic Regulation. Any proposals for a cost allocation methodology different
   from the one normally applied by the company concerned, has to be claimed within
  the time limits specified in the Notice of Initiation, in order to allow for a proper
   verification on the spot. This was, however, not done by the company concerned.
11 .The company furthermore claimed that the monthly cost of production figures
  were not representative since certain non-recurrent cost items were not spread out
   over the entire investigation period. In this respect, it should be noted that the
   Commission has based its calculation on data provided by the company. As the
   initial submissions of the company regarding its production costs did not reflect an
   appropriate allocation of (non-recurrent) costs, the company provided, at the
   request of the Commission, a revised version which was verified and used for the
   determinations. Consequently, there is no need to revise the calculations again.
12.Finally, this company alleged that in a high inflation environment it would be more
   appropriate to calculate an average cost of production per tonne for the whole
   investigation period and to adjust the average cost level by monthly inflation rates
   to arrive at monthly costs of production. This claim could not be granted as it was
   found to be possible within the accountancy system of the company to establish
   reasonably the actual cost of production incurred on a monthly basis. These
 ---pagebreak---    monthly costs, which were based on the questionnaire response and the
   information verified during the on-spot verification, were consequently used in the
   determinations.
                         b) Sales in the ordinary course of trade
13.One company raised some questions as regards the determination whether
   domestic sales were made in the ordinary course of trade. The company disputed,
   in particular, the exclusion of certain non-profitable transactions from the
   calculation of the normal values.
14.1n this respect, it should be recalled that the Commission established for the
   provisional duty Regulation whether domestic sales transactions of the company
   are in the ordinary course of trade, in accordance with Article 2 (4) of the Basic
   Regulation. Since the inflation rate of Poland was significant during the
   investigation period, calculations were carried out on a monthly basis in order to
   allow for a comparison of sales transactions and production costs at - as nearly as
   possible - the same time (see recitals 17 to 19 of the provisional duty Regulation).
15.Whereas this approach was not contested in general, the company claimed that in a
   high inflation environment the monthly average production costs should not be
   compared with individual sales transactions, but with monthly average domestic
   selling prices. The company alleged that the approach applied by the Commission
   would almost automatically lead to a larger number of sales at the beginning of a
   period being at a loss which would lead to their unwarranted exclusion. This
   argument is contradicted by the findings of the investigation. An analysis carried
   out by the Commission showed that contrary to the allegation of the company no
   clear pattern of profitable sales transactions at the end of a month, or transactions at
   a loss at the beginning of the month, could be established.
16.Furthermore, it was claimed that certain sales at a loss should not be excluded
    since the period for recovery of losses is at least six months, in accordance with
   Article 2 (4) of the Basic Regulation. With regard to one exporter it was found,
 ---pagebreak---    however, that during the whole investigation period (one year) more than 20 % of
   its sales were at a loss when comparing the monthly production costs with monthly
   sales transactions. Consequently, the exclusion of the sales at a loss is justified
   since the transactions were not in the ordinary course of trade. These sales at a loss
   were made in substantial quantities and a sufficient recovery from the losses as
   required by Article 2 (4) of the Basic Regulation could not take place.
17.For the other co-operating company, it was established that - on a yearly basis -
   less than 20 % of their sales during the investigation period was at a loss. It was,
   therefore, decided to include the sales at a loss in the calculation of the normal
   value which slightly reduced the normal value of this company.
                                    (ii) Export price
18.One of the Polish companies claimed that the total amount of its export turnover to
   the Community is higher than that applied by the Commission for its determination
   of the export prices. This argument was rejected as the calculation made by the
   company concerned was not based on the exchange rates attached to the
   questionnaire sent by the Commission.
               (Hi) Comparison between normal value and export price
19.One company requested that their normal value should be established on the basis
   of domestic sales to customers buying more than 2000 tons per year since
   customers on the export market (EC) would also buy more than 2000 tons. This
   claim could not be accepted since it was not claimed in the questionnaire response
   and no additional verification visits could be carried out after the imposition of the
   provisional duty. Therefore, it could not be established whether the company really
   applied a consistent quantity-related discount policy on the domestic market.
20.Both Polish exporters repeated their requests made prior to the imposition of
   provisional duties for an adjustment for differences in the level of trade. In this
 ---pagebreak---    regard it was, however, noted that no new arguments were presented to substantiate
   this claim. Therefore the findings, as laid down in recital 24 of the provisional duty
   regulation, are confirmed.
                                     (iv) Dumping margins
21.Taking into consideration the changes in the normal value for one company as
   indicated above, the other findings for Poland as laid down in recitals 17 to 28 of
   the provisional duty regulation are «confirmed and the recalculated dumping
   margins, expressed as a percentage of thefree-at-Community-frontierprices, are as
   follows:
        Huta Cynku 'Miasteczko Slaskie', Miasteczko Slaskie           14.4%
        Kombinat Gorniczco-Hutniczy Boleslaw, Bukowno                  5.2%
   The dumping margin applicable to non-cooperating producers/exporters remains
   unchanged at the level of 14.4 %.
                                            b) Russia
                                        (i) Normal Value
22.Since Russia is considered to be a non-market economy country for the purpose of
   anti-dumping proceedings (cf. Article 2 (7) of the Basic Regulation which refers to
   Regulation (EC) No 519/94 ( )), its normal value was established by reference to
   the normal value found in an analogue country (in this proceeding Poland, see
   recital 29 of the provisional duty Regulation). As the normal value for this country
   was revised, the normal value used for the calculations relating to Russia was
   revised accordingly.
        OJ No L 67, 10. 3. 1994, p. 89
                                             mÊÊÊÊmÊÊÊÊÊmÊÊÊÊÊÊÊÊÊÊmiÊÊÊÊmm P. 9
 ---pagebreak---                                     (ii) Export price
23 .One importer of Russian zinc alleged that Eurostat statistics for Russia might be
   incorrect due to wrong origin declarations and requested that its export transactions
   should form the basis of the export prices. This claim could not be granted since
   the allegations were not sufficiently substantiated and could -at this stage of the
   proceeding - not bé verified. The allegations would anyhow only invalidate a
   portion of Eurostat data.
               (Hi) Comparison between normal value and export price
24.This company further claimed that Polish and Russian zinc are not of the same
   quality and, therefore, an adjustment for physical differences should be made. In
   this respect, it was noted, however, that the normal value was established on the
   basis of the company producing the same quality as the majority of the Russian
   zinc producers. Consequently, an additional adjustment was not warranted.
                                (iv) Dumping margins
25.Taking into account the revised normal value established for the reference country
   and considering that the other findings for Russia as laid down in recitals 29 to 34
   of the provisional duty Regulation are confirmed, the recalculated dumping
   margin, expressed as a percentage of the free-at-Community-frontier prices,
   amounts to:
            Russia                                           6.9 %.
                                                                                     p. 10
 ---pagebreak---                                        E. INJURY
                               a) General Injury Factors
26.The comments made by the exporters in respect of the provisional findings
   regarding injury factors were limited to price undercutting. The Polish Government
   alleged, however, that there was little or no injury, arguing from the fact that
   Community producers were using almost full capacity. However, this argument
   does not invalidate the statement made in recital 51 of the provisional duty
   Regulation, i.e. that the investigation showed that, because of the special nature of
   the production process and the high fixed costs linked to the production of
   unalloyed, unwrought zinc, capacity must be as fully used as possible, even when
   this means that sales of the final products would afterwards be made at a loss. As
   stated in that recital, there are also high variable costs incurred (e.g. high energy
   consumption for start-up) if production is interrupted. It cannot therefore be
   accepted that the fact that, in the present case, the Community producers' capacity
   would have been almost fully used during the investigation period should lead to
   the conclusion that they were not suffering material injury.
27.0ne of the importers referred to at recital 3 above submitted that an increase of
   stocks of GOB could not have been caused by imports of HG zinc originating in
   Russia and objected to the cumulative assessment made for Poland and Russia
   arguing that Russia only produced HG zinc. These arguments disregard, however,
   that GOB and HG zinc compete with each other in the market segment of hot-dip
   galvanizing and brass manufacturing where they are used. Moreover, the
   conditions of competition between zinc originating in Poland and zinc originating
   in Russia are similar as neither HG zinc nor GOB zinc are traded at the LME and
   both grades, as well as slightly more expensive SHG zinc, can be used in this
   market segment.
                                                                                    »p. 11
 ---pagebreak--- 28.The provisional findings pertaining to, in particular, consumption on the
   Community market, production, sales and profitability of the Community industry
   and employment in the Community industry, as laid down in recitals 37, 38, 40
   through 45, and 50 through 60 of the provisional duty Regulation, are therefore
   confirmed.
                                  b) Price undercutting
29.Further to the comments made by the exporters and one of the importers referred to
   at recital 3 above, the provisional findings concerning the Community producers'
   prices have been reconsidered. As regards the premium of 3 % on the "LME price
   (recital 47 of the provisional duty Regulation), it was noted that the publications of
   the International Lead and Zinc Study Group confirm that during the investigation
   period zinc was being sold at a premium. The premium of 3 % or US$ 30 on an
   average LME price of US$ 1000/ton, paid during the investigation period, does not
   appear either excessive or unreasonable, taking into consideration, for instance,
   that loading costs at the LME warehouse (which are paid by the buyer but need not
   to be paid in case of direct sales outside the LME) amounted already to US$15/ton.
30.This premium of 3 % reflects the facts that the pripe charged by EC producers in
   case of direct sales to industrial users is not identical to the LME price, but
   somewhat higher to cover selling costs and the costs of both currency and zinc
   hedging, and that buyers accept to pay a slightly higher price e.g. if they are certain
   to obtain the specific brand of a given producer or if transport costs are lower than
   those from an LME-approved warehouse. The* premium includes all costs
   associated with the marketing and technical service offered to the customer, which
   are incurred by the producer. For the buyer, direct sales have the advantage that the
   cost of the warrant, the cost of moving the metal from an LME warehouse to the
   truck and the broker's fee, which would have to be paid in case of sales through the
   LME, need not be paid.
                                                                                     Ip. 12
 ---pagebreak--- 3 l.In this respect, it is worth noting that the cost of hedging included in this premium
    could not have been inflated, as this cost included administrative costs, the
    payment of broker's fees and finance charges only, while profits or losses arising
    out of hedging were separated out of the calculations in order to allow for a fair
    comparison.
32.The exporters and one of the importers.referred to at recital 3 above objected to the
    Commission's assumption that the prices of the three grades of zinc were identical,
    claiming that the prices of HG and GOB zinc were lower than the price of SHG
    zinc which had been used for the calculation (as the LME price is a price for SHG
    zinc). According to the exporters, account should be taken of the difference in price
   between the three grades of zinc. As the prices published by the International Lead
   and Zinc Study Group show that, during the investigation period there was indeed
   a very small differential between the prices of SHG, HG and GOB zinc it is
   appropriate to take account of this difference in price. While HG zinc was found to
   have been sold at a rebate of maximum 0.3 % on the price of SHG zinc, the
   differential between GOB and SHG was just below 1 % of the price of SHG zinc.
33.One of the exporters claimed that allowance should be made for the fact that its
   GOB zinc has a much higher cadmium content than Community produced GOB
   zinc and proposed that the market value of this difference, assessed on the basis of
   the cost of refining, should be added to its export prices in order to carry out the
   undercutting calculation on a fair basis.
34.While the exporter concerned showed that Community producers' zinc did meet
   the CEN 1179 standard and its (unrectified) GOB zinc did not, the documents
   submitted by this exporter did not enable the Commission services to make a
   precise assessment of the prices of non-Polish GOB zinc with the same cadmium
   content as the zinc exported by this exporter and sold in the Community market
   during the investigation period. The Community industry provided information on
   the costs of rectification (i.e. upgrading, by means of distillation, of GOB zinc not
   meeting the CEN 1179 standard into both SHG and GOB zinc with a standard
   cadmium content) that could be allocated to the elimination of excessive cadmium,
                                                                                     tp. 13
 ---pagebreak---     if this rectification took place immediately after the refining of zinc concentrates.
    However, the specific costs which should be allocated to the elimination of
    excessive cadmium in case of a rectification undertaken in another plant after
    completion of the process of refining zinc concentrates into unrectified GOB zinc
    (likely to be disproportionately high) could not be established precisely, as the
    exporter and the Community industry supplied contradictory information also
    relating to the question as to what extent it is, in this situation, economically
   realistic to carry out such a rectification with a view to removing excessive
   cadmium from unrectified GOB zinc.
35.Nevertheless, since the high cadmium content (and the health hazards resulting
   therefrom) prevents certain users from using the zinc without rectification,
   although the investigation showed this is not the case for all users, the price
   differential between high cadmium GOB zinc and GOB zinc meeting the CEN
    1179 standard had to be assessed. To tm\end, on the one-hand, it should be noted
   that it is not possible to conclude that the average market value* of zinc having a
   lower, "standard" cadmium content would coincide with the price of the exporter's
   zinc increased by the refining costs (as it is unlikely that these refining costs could
   always be entirely reflected in the price and thus fully passed on to any customer).
   On the other hand, the information submitted by the exporter (which showed that
   there was a differential between the price of its GOB zinc and the LME price
   exceeding the differential of 1 % between the prices of GOB and SHG zinc
   published by the International Lead and Zinc Study Group) and the Community
   industry demonstrates that a reasonable average price differential between GOB
   zinc with a high cadmium content and GOB zinc with a cadmium content not
   exceeding the limit of the CEN standard could be established, which is the basis for
   an adjustment of the export price of the Polish exporter concerned.
36.1n addition, the exporters claimed that a difference in level of trade should be taken
   into account as Polish export sales would have been made to traders only. As stated
   in recital 46 of the provisional duty Regulation, the undercutting calculation was
   made using the price in the Community market of zinc manufactured by
                                                                                      >p. 14
 ---pagebreak---    Community producers, established taking into account that considerable direct
   sales exist from zinc refiners to both industrial users and traders, which are not
   taking place through the LME. This means that both sales to industrial users and
   sales to traders were taken into account and that the calculated price charged by
   Community producers in the Community market, which was found to be somewhat
   higher than the LME price, constitutes an average price for both categories. It is
   therefore considered appropriate that the price undercutting calculation should be
   corrected on this point by adding a reasonable margin for the trader to the export
   prices used.
37.The exporters also claimed that an adjustment should be made for transport costs
   within the Community and one of them submitted that the export prices of the
   exporters should have been compared to the LME price of the month prior to the
   month in which the transaction took place. For the purpose of the price
   undercutting calculation, a comparison was made between the ex-works prices of
   Community producers and tlje export price of Polish zinc (cleared through
   customs, at the Community frontier) during each of the months of the investigation
   period. Therefore, it does not appear appropriate to make any further adjustment.
                               c) Conclusion on Injury
38.Taking into account the small difference in price between the three grades of zinc,
   the difference in the level of trade, and, for one of the exporters, the higher
   cadmium content of GOB zinc originating in Poland, the price undercutting
   margins were recalculated as follows:
            Huta Cynku 'Miasteczko Slaskie', Miasteczko Slaskie             14.0 %.
            Kombinat Gorniczco-Hutniczy Boleslaw, Bukowno                    6.6 %
            Other Polish producers/exporters                                14.0 %
            Russia                                                           5.2 %
                                                                                    p. 15
 ---pagebreak--- 39. Apart from these modifications, the provisional findings laid down in recitals 37 to
    60 of the provisional duty Regulation are confirmed.
                                    F. CAUSATION
40. One of the importers referred to at recital 3 above made some comments on the
   Commission's findings essentially based on the assumption that HG and GOB zinc
   would not be competing with each other. As this assumption is incorrect, no
   sufficiently substantiated comments were made on the provisional findings
   concerning the causal link between dumping of zinc originating in Poland and
   Russia and injury to the Community producers, recitals 61 to 70 of the provisional
   duty Regulation are herewith confirmed.
                            G. COMMUNITY INTEREST
41.No representations concerning Community interest were submitted by industrial
   users or their representative associations. The exporters pointed out, however, that
   stocks in LME warehouses had decreased since the end of the investigation period
   and that prices might go up shortly, as supply would fall short of demand.
42.In this regard it should be noted that a direct linkage exists between the price of
   zinc concentrates (i.e. the raw material used by zinc refiners) and the price of
   refined zinc. Therefore, any price increase of refined zinc at LME level
   automatically corresponds to an increase in the cost of raw material for Community
   producers. Accordingly, no remedial effect can be expected from an increase of
   the price of refined zinc at that level and no such price evolution can be such as to
   render measures unwarranted in the present case.
43.One of the importers referred to at recital 3 above argued that the interests of final
   consumers had not been properly assessed. In this regard, it should be noted that
   the Commission has found that the effect of measures on user industries should be
   minimal. It may therefore be assumed that no major price increases for final
   consumers will occur.
                                                                                     p. 16
 ---pagebreak--- 44.The same importer, which claimed that Russian smelters would produce zinc for it
   in accordance with a tolling agreement, also alleged that measures would be
   against the Community interest because some major Community producers had
   bought zinc originating in Russia. This allegation was however not sufficiently
   substantiated. In addition, it should be recalled in this respect, that Article 4 (1) (a)
   does not provide for the automatic exclusion of producers which themselves import
   the dumped product.
45.The provisionalfindingsregarding the Community interest assessment (recitals 71
   to 75 of the provisional duty regulation) are confirmed.
                               H. DEFINITIVE MEASURES
                                        a) Undertakings
46.Subsequent to the imposition of provisional anti-dumping duties and the
   submission of their comments on the Commission's provisional findings, the two
   co-operating Polish exporters offered an undertaking under Article 8 of the Basic
   Regulation. By offering these undertakings, each of the exporters commits itself,
   inter alia, to respect minimum prices for the different grades of exported zinc,
   which prices are directly linked to the LME prices for SHG zinc, during a specified
   period of reference.
47.These undertakings should eliminate the injurious effects of dumping as envisaged
   by Article 8 (1) of the basic anti-dumping Regulation and can be monitored
   effectively. The Commission consulted the Advisory Committee on the acceptance
   of these undertakings and no objections were raised. The undertakings offered were
   subsequently accepted by Commission Decision 97/            /EC (5). The investigation
   should therefore be terminated in respect of these exporters.
        See p.    of this Official Journal.
                                                                                       p. 17
 ---pagebreak---                                    b) Definitive Duty
48.A residual duty on imports of zinc originating in Poland should be imposed. This
   residual duty is deemed necessary in order to prevent that non-co-operating parties
   will benefit from their non-co-operation. Moreover, although in the present case
   the exporters have contested the figures concerning exports of zinc from Poland to
   the EC that were used by the Commission, they were not able to explain whether
   the discrepancy between these figures and their own exports represented indirect
   exports to the EC of their own products or exports of other zinc. The rate of duty
   should correspond to the injury margin, since that margin was found to be lower
   than the dumping margin.
49.Russian producers/exporters did not co-operate in the investigation. It was
   therefore argued that the rate of duty for Russia should be at least as high as the
   rate of duty found for the non-co-operating Polish companies. This claim could not
   be accepted as the rates of duty are normally calculated on the basis of data
   established for each of the respective countries. Consequently and since the
   findings for Russia were only revised in respect of the normal value established for
   the market economy reference country, it is necessary to impose a definitive anti-
   dumping duty on imports of zinc originating in Russia at the injury elimination
   level as the injury margin is lower than the revised dumping margin.
           I. DEFINITIVE COLLECTION OF PROVISIONAL DUTY
50.One of the importers referred to at recital 3 above, a company established after the
   publication of the notice of initiation, requested that its uncleared stocks held in
   bonded warehouse on 5 April 1997 be exempt from the definitive collection of the
   provisional anti-dumping duty, arguing that, in the light of its specific
   circumstances, it would have been its legitimate expectation that no duties would
   be imposed. However, since the imposition of provisional anti-dumping duties took
   place further to a duly announced investigation, importers are, in principle, not
                                                                                   p. 18
 ---pagebreak---    entitled to an exemption on this point. The specific circumstances invoked by the
   importer are not such that an exception to this rule would be justified.
51.As the co-operating Polish producers/exporters undertook to respect the
   undertakings asfrom20 June 1997, subject to their acceptance by the Commission,
   it is appropriate not to collect the provisional anti-dumping duties on zinc
   manufactured by these exporters which offered these undertakings, and released
   into free circulation on or after that date. As regards imports of zinc manufactured
   by these exporters, which took place before 20 June 1997, the provisional anti-
   dumping duties should, however, be collected at the rates that would have applied
   had the undertakings not been accepted (i.e. 5.2 % for Kombinat Gorniczco-
   Hutniczy Boleslaw, Bukowno, and 14.0 % for Huta Cynku 'Miasteczko Slaskie',
   Miasteczko Slaskie).
52.Regarding imports of zinc originating in Poland and manufactured by other
   producers than the two co-operating ones, and all imports of zinc originating in
   Russia, the provisional anti-dumping duties should be definitively collected only
   up to the rate of the definitive anti-dumping duties, i.e. 14.0 % and 5.2 %,
   respectively.
                               J. FINAL PROVISIONS
53.The Community industry concerned has been informed of the main facts and
   considerations on the basis of which it was intended to recommend the imposition
   of definitive measures including the acceptance of undertakings and did not object.
54.The exporters have been informed of the main facts and considerations underlying
   the intended Commission proposal for definitive measures. They have not made
   any further comments.
                                                                                   fP-19
 ---pagebreak--- 55.In accordance with the Europe Agreement with Poland (6), the Association Council
   and the Polish government have been supplied with all relevant information and
   have been informed in advance of the outcome of the investigation laid down in
   this Regulation and the Commission Decision accepting the undertakings offered
   by the exporters. The Polish government explicitly expressed its satisfaction with
   the solution found for the two co-operating Polish exporters.
56.1n accordance with the Interim Agreeement with the Russian Federation (7), the
   Russian government has been supplied with all relevant information and has been
   informed in advance of the outcome of the investigation laid down in this
   Regulation,
 HAS ADOPTED THIS REGULATION:
                                        Article 1
1.      A definitive anti-dumping duty is hereby imposed on imports of unalloyed,
        unwrought zinc falling within CN codes 7901 11 00, 7901 12 10 and 7901 12
        30 originating in Russia and Poland.
2.      For the product referred to in paragraph 1 originating in the Russian
        Federation, the rate of the anti-dumping duty applicable to the net, free-at-
        Community-frontier price, before duty, shall be 5.2 %.
3. ••   For the product referred to in paragraph 1 originating in Poland, the rate of the
        anti-dumping duty applicable to the net, free-at-Community-frontier price,
        before duty, shall be 14.0 % (Taric additional code 8900) except for imports
        manufactured and sold for export to the EC by
        - Kombinat Gorniczco-Hutniczy Boleslaw, Bukowno
        OJNoL348,31. 12. 1993, p. 2
        OJNoL247, 13. 10. 1995, p. 1
                                                                                    p. 20
 ---pagebreak---             (Tarie additional code 8965) or
    - Huta Cynku "Miasteczko Slaskie", Miasteczko Slaskie
            (Tarie additional code 8093),
    which shall be exemptfromthe duty,
   provided these imports are accompanied by a certificate EUR. 1 issued after
    19 June 1997, in which the name and address of either company are filled in
   under the heading "exporter" and the EC or one of its Member States is filled
   in as country of destination, and which is certified by the Polish authorities
   and issued in accordance with the provisions of the Europe Agreement
   establishing an Association between the European Communities and their
   Member States, on the one part, and the Republic of Poland, on the other part.
4. Unless otherwise specified, the provisions in force concerning customs duties
   shall apply.
                                    Article 2
1. The amounts secured by way of the provisional anti-dumping duty, imposed
   pursuant to Regulation (EC) No 593/97 shall be definitively collected at the
   rate of the duties definitively imposed on imports of unwrought, unalloyed
   zinc originating in Poland and Russia, respectively. However, without
   prejudice to paragraph 2, the provisional anti-dumping duty imposed on
   imports originating in Poland manufactured and exported by Kombinat
   Gorniczo-Hutniczy Boleslaw, Bukowno, shall be definitively collected at the
   rate of 5.2%.
   The amounts secured in excess of the definitive rate of anti-dumping duty
   shall be released.
2. Provided that it is demonstrated that zinc of Polish origin was manufactured
   by either Huta Cynku "Miasteczko Slaskie", Miasteczko Slaskie, or by
                                                                           I P. 21
 ---pagebreak---         Kombinat Gorniczo-Hutniczy Boleslaw, Bukowno, and released into free
        circulation on or after 20 June 1997, the provisional duty shall not be
                                                                        v
        definitively collected.
                                       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, ________ 1997.
For the Council
 The President
                                                                                   IP-22
 ---pagebreak---                                                                   ISSN 0254-1475
                                                           COM(97) 440 final
                                              DOCUMENTS
EN                                                                02 08 11
                                    Catalogue number : CB-CO-97-450-EN-C
                                                             ISBN 92-78-24335-3
Office for Official Publications of the European Communities
L-2985 Luxembourg
                                                                            *3