CELEX: 51992PC0208
Language: en
Date: 1992-05-26
Title: Proposal for a COUNCIL REGULATION (EEC) amending Regulation (EEC) No 1768/89 in respect of the definitive anti-dumping duty on certain imports of video cassettes originating in Hong Kong

iCGMt/IISSION OF THE EUROPEAN COMMUNITIES
                                                                 COM(92) 208 final
                                                                 Brussels, 26 May 1992
                                               Proposal for a
                                          COUNCIL PF^ULATION (EEC)
                     amending Regulation (EEC) No 1768/89 in respect of the definitive
                          anti-dumping duty on certain Imports of video cassettes
                                          originating in Hong Kong
»  * * ! # & * •
                                        (presented by the Commission)
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                       EXPLANATORY  MEMORANDUM
1. By Regulation (EEC) No 1768/89, the Council    imposed a definitive
   anti-dumping duty of 21.9% on imports of VHS video tape in cassettes
   originating in Hong Kong.
2. By a notice published on 12 October 1991 the Commission initiated a
   review of the anti-dumping duty concerned as regards a Hong Kong
   company, Bico Magnetics Ltd.
3. The investigation showed that Bico Magnetics Ltd had never exported
   own-produced video cassettes to the European Community and was about
   to begin such exports.
4. Normal value was determined on the basis of constructed value of the
   models concerned.
   Since Bico Magnetics Ltd had not exported video cassettes to the
   Community, no export price could be established.
5. In these  circumstances, the anti-dumping duty to be imposed should
   be a variable duty equal to the difference between the normal value
   and the net price free-at-Community-frontier.
6. In conclusion, it is proposed that the Council amend its Regulation
   (EEC) No 1768/89, exempt Bico Magnetics Ltd from the definitive
   anti-dumping   duty  imposed  on   VHS  video  tapes   in  cassettes
   originating in Hong Kong and impose instead the above variable duty
   for the models meant to be exported to the Community.
 ---pagebreak---                                     - 3 -
                               Proposal for a
                          COUNCIL REGULATION (EEC)
    amending Regulation (EEC) No 1768/89 in respect of the definitive
         anti-dumping duty on certain imports of video cassettes
                          originating in Hong Kong
THE COUNCIL OF THE EUROPEAN COMMUNITIES,
Having regard to the Treaty establishing the European Economic Community,
Having regard to Council Regulation (EEC) No 2423/88 of 11 July 1988 on
protection  against   dumped  or  subsidized    imports from countries not
                                              1
members of the European Economic Community , and in particular Article
14 thereof,
Having regard to the proposal submitted by the Commission after
consultation within the Advisory Committee as provided for under the
above Regulat ion,
Whereas:
                           I - PREVIOUS PROCEDURE
1.   By Regulation (EEC) No 1768/89 2 , as amended by Regulation (EEC)
     No 3522/90 3 , the Council imposed a definitive anti-dumping duty of
     21.9% on imports of VHS video tape in cassettes (hereafter "video
     cassettes") falling within code ex 8523 13 00 and originating in
     Hong Kong, with the exception of imports from several exporters
     especially mentioned which were subject to a lesser rate of duty or
     exempt from duty.
1    OJ No L 209, 2.8.1988, p. 1.
2    0J No L 174, 22.6.1989, p. 1
3    OJ No L 343, 7.12.1990, p. 1
 ---pagebreak---                                       - 4-
2. In recital 43 of Regulation (EEC) No 1768/89, concerning                 companies
   which started or will start exporting own-produced video cassettes
   to the Community      after  the    investigation period        (newcomers),    the
   Council noted that the Commission is ready to initiate without delay
   a   review    proceeding    if    the   exporting       company    can   show   the
   Commission, and supply sufficient evidence, that               it did not export
   the   products    concerned    to   the   Community      during   the   period   of
   investigation.     The company also has to demonstrate that             it started
   or will start those exports after the said period and that it is not
   related to or associated with any of the companies subject                   to the
    invest igat ion.
                                  II - REVIEW
3. By a notice published on 12 October             1991 4 , the Commission,      after
   consultation within the Advisory Committee               and  in accordance with
   Article    14 of Regulation      (EEC) No 2423/88         initiated   a review of
   Regulation    (EEC) No 1768/89 as       it concerned       a Hong Kong     company,
   Bico Magnetics Ltd. This         company    had   submitted     that   it did   not
   export    the products   subject     to the anti-dumping         duty  during   the
   previous period of      investigation      (1 January - 30 November          1987).
   In addition, it submitted that         it was    not related with any of the
   companies subject     to the previous       investigation for which         dumping
   was   found.    In addition, no evidence was found             that   it had   ever
   exported     video   cassettes     to    the   Community.      Accordingly,     the
   Commission commenced an investigation in order to verify that Bico
   Magnetics Ltd could be considered as a newcomer and to establish a
   dumping margin, if any, for this company.
   OJ No C 266, 12.10.1991, p. 7
 ---pagebreak---                                      - 5 -
                                   Newcomer
4. The investigation showed that Bico Magnetics Ltd had not previously
   exported or produced video cassettes which were exported              to the
   Community and was now about to begin such exports.          In addition, it
   was found     that this company      had no   link of any sort with the
   exporters involved in the previous procedure and for which dumping
   was   found.   The Council     confirms  that   it should    accordingly   be
   considered as a newcomer and that a partial review of Regulation
   (EEC) No 1768/89, inasmuch as it concerned Bico Magnetics Ltd, was
   warranted.
                    Ill -   RESULTS OF THE INVESTIGATION
                               1. Normal value
5. Since Bico Magnetics Ltd did not sell any video cassettes on the
   domestic market      during the    investigation period    for   this review
   (from 1 January to 30 June 1991), normal value was determined on the
   basis   of    the   constructed   value   of   the  product    concerned   in
   accordance with Article 2(3)(b) of Regulation           (EEC) No 2423/88.
   This constructed value was computed on the basis of all costs, both
   fixed   and variable,     in the country of origin of materials and
   manufacture for the models destined for export to the Community plus
   a   reasonable    amount   for  selling, administrative, other       general
   expenses and profit.
6. As   far   as   selling,    administrative   and   general    expenses   were
   concerned, they were calculated by reference to such expenses as
   they were stated       in the audited accounts of Bico.         These costs
   corresponded to such costs incurred by other Hong Kong manufacturers
   for   their   sales of video cassettes on        the domestic market, as
   established      during    previous    investigations    concerning     video
   cassettes from Hong Kong.
 ---pagebreak---                                      - 6 -
    As far as profit was concerned, it was found appropriate to apply a
    profit  rate of 8% on turnover; this rate was used             in Regulation
    (EEC) No 1768/89 for the Hong Kong video cassette manufacturers and,
    according to the information available to the Commission, can still
    be regarded as the profit which Hong Kong companies can normally
    achieve   on  their   domestic    market.   The   Council    confirms   these
    f indings.
7.  On this basis, normal value was established for the models produced
    and destined for export      to the Community      by Bico Magnetics Ltd,
    namely normal grade.
                                 2. Measures
8.  Since it was found that Bico Magnetics Ltd had not exported video
    cassettes to the Community, no export price could be established for
    the product   under consideration, and no dumping margin could be
    calculated.
9.  However, it is clear that if the export prices of the various models
    of  video   cassettes   sold   for   export   to   the  Community    by  Bico
    Magnetics Ltd at least equal the normal value for the corresponding
    models, these products would not be dumped.
10. In addition,    this  normal    value   is  less   than   the   target  price
    determined   for  the   Community     industry   in   Regulation    (EEC)  No
    1768/89.
 ---pagebreak---                                     - 7-
11. In these circumstances, it is considered that the measures to be
    imposed   in  respect  of   the   imports   to   the  Community  of   video
    cassettes produced by Bico Magnetics Ltd, should guarantee that the
    products are not sold to the Community at less than their normal
    value.
                 IV - AMENDMENT OF THE REVIEWED MEASURES
12. Accordingly, it is considered appropriate that Regulation (EEC) No
    1768/89 should be amended and that Bico Magnetics Ltd be exempted
    from the definitive anti-dumping duty imposed on VHS video tapes in
    cassettes originating in Hong Kong       in respect of the models E60,
    E90, E120, E180, E195 and E240, in so far as these models will be
    subject to a duty equal to the difference between minimun price set
    out for each of these models and their net price free-at-Community-
    frontier before customs clearance.     The minimum price corresponds to
    the normal value duly adjusted to bring it to CIF level.
13. Bico  Magnetics    Ltd  was   informed   of    the   essential  facts   and
    considerations on the basis of which the imposition of the anti-
    dumping  duties were    proposed, and was given         an opportunity   to
    comment on such proposal.     No comments were made by the exporting
    producer concerned.
14. The complainants were informed of the considerations and main facts
    on the basis of which the Council intented to amend Regulation (EEC)
    No 1768/89 and had no comment to make.
15. Since this review is only limited to one Hong Kong producer, it does
    not prolong the validity of Regulation (EEC) No 1768/89 in regard to
    Article 15(1) of Regulation (EEC) No 2423/88,
 ---pagebreak---                                    - 8
HAS ADOPTED THIS REGULATION:
                                 Article 1
The following subparagraph is hereby added to Article 1(3) of Regulation
(EEC) No 1768/89:
"The duty specified in paragraph 2(b) shall not apply to models of video
tapes in cassettes E60-E90-E120, E180-E195-E240 in normal grade produced
and sold for export to the Community by Bico Magnetics Ltd, Hong Kong
(Taric additional Code 8292); these models shall be subject to an anti-
dumping  duty  equal   to  the  difference  between   the price  mentioned
hereunder for each of the models concerned and their net price, free-at-
Community-frontier, not cleared through customs:
          E60        E90       E120      E180       E195     E240
        ECU 0.70  ECU 0.83   ECU 0.96  ECU 1.22  ECU 1.29  ECU 1.48
 ---pagebreak---                                   - 9 -
                                Article 2
This Regulation shall enter  into force on the day following that of 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
                                                     The President
 ---pagebreak---  ---pagebreak---                                                                      ISSN 0254-1475
                                                              COM(92) 208 final
                                                      DOCUMENTS
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                                                             ISBN 92-77-44294-8
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