CELEX: 51981PC0027
Language: en
Date: 1981-01-21
Title: Proposal for a COUNCIL REGULATION (EEC) imposing a definitive anti-dumping duty on certain chemical fertilizer originating in the United States of America (submitted to the Council by the Commission)

ARCHIVES HISTORIQUES
DE LA COMMISSION
COLLECTION RELIEE DES
DOCUMENTS "COM"
COM (81) 27
Vol. 1981/0006
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 ---pagebreak--- COMMISSION OF THE EUROPEAN COMMUNITIES
                                                    COM(31)27     final
                                      fa;:/         Brussels
                                                    Brusse Ls >* 21 January 1931
                                      V-.*•
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                                                - ,     ;?s
                                    Proposal for a
                               COUNCIL REGULATION (EEC)
            imposing a definitive anti-dumping duty on certain chemical
              fertilizer originating in the United States of America
                    ( submitted to the Council by the Commission )
COM ( 31 ) 27 final
 ---pagebreak---                           EXPi.AfvH   ; '->Y MEMORANDUM   -
   On 15 August 1980 . by Regulation 2182 / 80         the Commission imposed a provisional
   anti-dumping duty on exports of urea ammonium nitrate solution fertilizer
   originating in the Uni ted' States of America *             This duty was based on the
   findings at Allied Chemicals Corporation which was at the time - the only
   US producer which co-operated with the Commission 's investigation *
   Subsequently a number of other producers and exporters claimed that their
               I       ·
   sales for export to the EEC were not dumped and the Commission proceeded
   to make on^-spot investigations on the premises of these companies ; the
*              f •                     ■                           *
   Commission also received further information from a number of US brokers
   and importers *
                                                             »
   The facts as finally established for the investigation-period of the first
                                                                           ν
   nine months of 1980 show that the product sold for export by Agrico Chemical
   Company has not been dumped , whereas export sales by other producers and / or
   exporters have been dumped at dumping margins varying between 5 and 10% ,
   the weighted average of those companies deemed to have been dumping being
■ 6.5%* - ' • ! '                   *                       ' :                       "; :     . .
   In respect of injury caused by these dumped export-, to the EEC industry and
   especially the French production latest figures show that for the first four
   months of the agricultural year ( June - September ) there has been a 50%
            dumped                                                                          v
   increase in/ imports from the US compared to the same period of last year *
   Resale prices in the EF.C of the dumped imports are still considerably lower
   than price levels needed by EEC production to cove r total costs .
   The following companies have offered undertakings to incr-r - ~e their prices to
   a level which elimins- tes            <x ":s not exceed the c' mp-'r ? ■norg-'n end which the
 v Commission finds acceptable1 : Allied Chemicals /Cor; - jr?tion> Kaiser Aluminum
   Domestic and International Sale1; Corporation , Col. bia Nitrogen Torporation ,
   Transcontinental Fertilizer C i por .^ *: ion . Interne tiora I C-'e and Fertilizer
   Corporation , and BCM Incorporated *
    0J N° L 212 , 15 * 8„ï?30 , p * 43
 ---pagebreak---                              - 2 -
               I
On the basis of these facts the Commission therefore submits to the
Council its proposal for a Council regulation imposing a 6.5% definitive
anti-dumping duty on certain chemical fertilizer originating in the
United States of America , excluding the above-mentioned companies and
             !                                                   '
Agrico Chemical Company from the application of the dut ^. and definitively
            i                                                             x
collecting the amounts secured as provisional duty up to the dumping
margins found ,,
 ---pagebreak---                           Proposal for a
                   COUNCIL REGULATION ( EEC )
 imposing a definitive anti - dumpir.g duty on certain chemical fertilizer
originating in the United States of- America
THE COUNCIL OF THE EUROPEAN COMMUNITIES ,
                                                                     I
Having regard to the Treaty establishing the European Economic Community ,
Having regard to Council Regulation ( EEC) No 3017 / 79 of 20 December 1979
on protection against dumped or subsidized imports from countries not
                                              1
members of the European Economic Community , and in particular Article 12  1
thereof .                                                 '
Having regard to the proposal submitted by the Commission after consultation
with the Advisory Committee set up under Article 6 of Regulation ( EEC )
No 3017 / 79 ,
Whereas in December 1979 the Commission received a complaint lodged by
the Comit6 Marche Commun de I'lndustrie des Engrais Azotes et Phosphates
on behalf of manufacturers accounting for a major part of the Community 1
production of urea ammonium nitrate solution fertilizer ; whereas the
complaint contained evidence of the existence of dumping in respect of
the like product originating in the United States of America , and of
material injury resulting therefrom , especially in France and the Federal
Republic of Germany ;                                   .          '
Whereas the said information supplied provided sufficient evidence to
justify initiating a proceeding ; whereas the Commission accordingly
announced , by a notice published in the Official Journal of the European
           .   2
 Communities , the initiation of a proceeding concerning imports of certain
chemical fertilizer originating in the United States of America , and
commenced an investigation of the matter at Community level ;
  0J N° L 339 , 31 . 12,1979 , p. 1
2 0J N° C 47, 26 * 2.1980, p. 2
 ---pagebreak---                                                                                        *
              Whereas during its preliminary investigation' which was based on an
               investigation, period covering the calendar year 1979' the Commission took
              account of the fact that all US companies known to be concerned' wh ich are
              selling the product in question on the domestic market, with the exception
              of Allied Chemi cafp? rSTi0n6t furnish the information deemed necessary to
                                                                          spot
               establish normal value and did not agree to on-the- investigations at their
              premises ; whereas, therefore,, the Commission had to base its determination of
              normal value on the evidence provided by Allied Chemical            Corporation;
              whereas , in respect of export pri ces , information was available from Allied
,icaL Corporation and a jnumber of brokers ; , whereas having established , on this basis ,
                           I           that the exports of the product in question were
              dumped at a weighted average margin of 12«2% and since there was
              sufficient evidence of injury resulting from their entry for consumption
              into the Community and since the interests of the Community called for
              immediate intervention in order to prevent further injury being caused           .
                                                                                             1
              during the proceeding , the Commission , by Regulation ( EEC ) No . 2182 / 80 ,
              imposed a provisional anti-dumping duty on certain chemical fertilizer
              originating in the United States of America ;       whereas Allied Chemical
                                         βη
              Corporation had offered / acceptable    undertaking to increase its export
              prices                                        / '       ar) d was therefore
              exempted from the provisional duty; whereas subsequent to the re-examination
              of the ,   normal value /'Allied Chemical    Corporation has renounced this
              undertaking ;
                        the period of validity of
              Whereas /this provisional duty was extended for a period not exceeding
                         :   .     ...                              2
              two months by Council Regulation ( EEC) No 314V80 ;
              0J N° L 212 , 15 . 3*1980 , p. £3
            2 0J N° L 330, 6 - 12- 1980, p. A
 ---pagebreak---                                               - 3 -
             Whereas in the course of the subsequent examination of the matter ,
             completed after the imposition of the provisional anti-dumping duty , the
              interested parties had the opportunity to make known their views in
             writing , i to be heard by the Commission and to develop their views orally,
23 / 20
             to inspect non-confidential information relevant to the defence of their
              interests and to be informed of the essential facts . and considerations .
             on the basis of which it was intended to make a final determination ;
             whereas the      complainants .        and most of the exporters and importers
             concerned availed themselves of these possibilities by making known
                 *•                                                                       ' • .
             their views in writing and orally ;
             Whereas a number of producers and exporters from whom the Commission had
             sought information during the preliminary investigation now came forward
             and offered to provide the information on normal value and export prices ;
             whereas therefore the Commission decided to carry out inspections at the
             premises of Agrico Chemical Company ( Tulsa ), Kaiser Aluminum Domestic and
          .  , Corporation
 International Sa les /( Savannah ) , Columbia Nitrogen Corporation ( Augusta ) and BCM Incorporated
             ( Memphis ) and to carry- out a further inspection at the premises of
             Allied Chemical      Corporation ( Morristown ) in order to update the information
                                       whereas                                            '
             originally received; /the Commission obtained further information from
             International Ore and Fertilizer Corporation ( New York ), Transcontinental
             Fertilizer Corporation ( Phi ladelphia ) and from Unifert Europe SA , Comagri SA ,
             Essochem Belgium , Unie van Kunstmestfabr ieken and Helm Düngemittel GmbH
             within the EEC ; '     _
             Whereas, in seeking to determine the existence of dumping the Commission
             compared the export prices to the Community with the normal value ;
             whereas , for those companies sel ling ■ ni trogen solution fertilizer on the
                                                                                   thei r
             US domestic market/ normal value was established on the basis of / prices -
                                                                  * from
                            on the American market in the period / 1 January to 30 September 1980
             excluding sales through company-owned retail outlets because these sales
                    not   .
             were / considered to be .       at the. same level cf trade as export sales to
              EEC distributors ;                                                      '
 ---pagebreak---                                     - L -
Wher^a ; for - Cotui .IBI * Nitrogen Corporat IOT   however , whose domestic saleS of
the p rod JC t in question were found to !'         been made at a loss during the
abovementioned      investigation period .        normal value was established on
the basis of costs of production inc            ing a reasonable margin for overheads
nnd profit for the third quarter o -       1980/- this being "the period during
which the company 's only 1980 expo ; t sale        was made and when its new
production plant was operating for the first time under normal conditions ;
whereas^ given the particular debt equity ratio of this company a profit
margin of only one percent was considered reasonable ;
Whereas/ in the case of export sales made by brokers who neither sell the
product on the US domestic market nor sell it in any significant quantity to
third count l-ies/ normal value was established on the basis of the price at
which they purchased . he quantities destined for export from their suppliers ;
Whereas/ export prices were determined on the basis of prices actually paid
or payable for the product concerned sold for export to the Community ;
Whereas / in the case of imports made by Esscchem Belgium and UKF the export
price had to be constructed on the basis of the price at which the imported
product was first resold to independent buyers because both importers had
associations with their respective exporters ; whereas, for the purposes of
this construction / allowance was made for a reasonable margin for overheads
and profit , a 3 % margin being considered reasonable ;
Whereas the cbmparisons were made transaction by transaction on an ex-factory
                                                    whereas
basis for all of the producers visitec^ and / for BCM Inc , a trader selling
both for export and on the domestic market , the comparison was made at an
ex-shipping point level, this being either ex-factory producer or ex-terminal ;
                                                                             I
Whereas most of the companies <nsited claimed that/ for the purpose of a
fair compari sore account should be taken of differences in distribution and
selling costs on domestic and export markets and differences in payment
terms ;     ,
 ---pagebreak---  Whereas the Commission took account of the differences affecting price ,
 comparability with respect to variable distribution and selling costs ,
                         and                                         ■   , ... - '•
 salesmen 's salaries / payment conditions and of cash discounts where
 claims in these areas could be satisfactorily demonstrated;
 Whereas this examination showed that exports made by Agrico Chemical Company
during the investigation period were not dumped; whereas for the other
 companies visited the dumping margins found were for Allied Chemical
 Corporation 6.5% , for Kaiser' Aluminum Domestic and International Sales
 Corporation 5„0% , for Columbia Nitrogen Corporation 10„0% and for BCM
                                 <       r
 Incorporated 7.6% ;
Whereas for brokers who may buy the product from various us producers for
export to the EEC, and foe all other exporters not known to the Commission,
the dumping margin was .determined as being the weighted average dumping
margin of those compar ies invest igated which were found to have been
dumping ; whereas the dumping margin thus established was 6»5Z ;            ,•
Whereas / as regards , the injury caused by the dumped imports - to the Community
and in particular to cne French industry , the considerations which led to ,
 the imposition of the provisional duty remain valid; whereas further
 information received
  by the Commission after the imposition of- the provisional duty showed that
  dumped imports into Franceof the product in question originating in the
  United States of America tor the four~month period from June to September
       amounted to
  1980        206 835 tonnes ," excluding 21 600 tonnes of the product exported
  by Agrico Chemical Company and deeded not to have been dumped , compared
  to 137 950 tonnes for the same period in 1979, representing an increase
  of at least 50%;
• Whereas/ a Ithough there was a considerable increase in the price of US
    J                                '                          ' -'   '
   exports during 198CU the resale price of imported nitroqen solution .
   fertilizer in Fra ne e stili e.es not perent Frenc'i producers to se II their
                           owing
  product at above cost/      _ to a further increase in feedstock prices in
   August 1980 ;
 ---pagebreak---                                - 6 -
Whereas the Commission also followed up the contention of various exporters
and importers that the French industry WKS working at full capacity but
was concentrating primarily on solid nitrogen fertilizer and was , therefore ,
unable to produce more nitrogen solution ; whereas the facts as established
by the Commission show that                    the French industry could
significantly increase its production of solution even if present output
      nitrogen
of solid / fertilizer was maintained;
Whereas the Commission has considered whether there is injury caused
by other factors which , individually or in combination are
also affecting the Community industry ;
whereas it has established in this context that the level of consumption
                                                                    /
of nitrogen solution fertilizer in Germany and especially in France , the
main outlets for US exports in the Community , has considerably increased
in recent years ; whereas , moreover , the volume of non-dumped imports from
Agrico Chemical Company 'was relatively small compared to total imports , and
represented less than 17% thereof in 1980 ; whereas the influence of these
non-dumped imports on the nitrogen solution fertilizer market has been
isolated from the dumped imports ; whereas the substantial and sudden
           imports of .         .  .
increase of/ dumped nitrogen solution fertilizer since 1978 and the prices
at which they were offered for sale in the Community led the Commission to
determine that the US exports of dumped nitrogen solution fertilizer have
caused material injury to the Community industry concerned ;
Whereas* in these circumstances protection of the Community 's interests
calls for the imposition of a definitive anti-dumping duty on nitrogen
solution fertilizer originating in the United States of America which ,
having regard to the extent of injury caused , should be equal to the dumping
                                                4                        \
margins found , and for the definitive collection of the amounts secured by
way of provisional duty in respect of the product concerned up to the rate of
the dumping margins found on transactions made by           those companies from
which undertakings have been accepted by the Commission and at the rate of
the definitive duty on all other imports ;
 ---pagebreak---                                                       - 7 -
                 Whereas it is approprid .^ to exclude imports of the produce exported by
                 Agrico Chemical Company from the application of the duty and the definitive
                 collection of the amounts secured by way of provisional duty because ,
                 these exports were not found to have been dumpe :! ,                         -         .
                 Whereas Allied Chemical            Corporation , Kaiser Aluminum         Domestic, and International
? Corporation. Columbia Nitrogen Co rp*. ration , BCM Incorporated ,. International Ore and
                                   Int?rore C < -poration Inç . ,       .         ...                     ,
                 fertilizer Corporat ion > a.ia Transcont inéntal Fertilizer Corporation have
                 voluntarily undert?-\«n fcq -increase' their prices to a level eliminating
                 but not exceeding the dumping margins found ; whereas the Commission has
                 accepted these undertakings;                                            _
                 Whereas it is consenuently appropriate to exclude the imports of the
              - product concerned exported by these companies from the application of the
                 duty, ^ :                      ' ,                                   '
             . HAS ADOPTED THIS REGULATION : ' ~
                                                     Article 1                  " ■ '
                  1*      A definitive anti-dumping duty is hereby imposed on u ,- ea ammonium -
                  nitrate solution •fertilizer , falling within Comic^n CM'toma Tariff
           -      subheading ex 31 * 02 C ard corresponding to NIME'E code ex 31 * 02-90 ,
    ,            originating in the » Jnit?d States of America *
                • ~                                       , "A                ,         , ,        .'       determined
                 2*      The rate of the dcK >* shall be 6*5 A on the               is of thr customs value
                  in accor*dance with        Cc-nm           u'.ation ( ECC ) No 1        80 ot <-° May       1980
                 on the valuation of gov'"s fur cu^tci:s purposes ■ '' )
                 3*      The provisions in -fopce • .'or the appl.i        n-'n •/ oust       c' ; ier' •!•>? '. I      , j
                  apply to this duty *                                                                                    j
                     ( 1 ) 0J N. L 134 , 31 .5 . 1980r P - 1 -                                                         , i
 ---pagebreak---                                   Article 2
       The definitive anti-dumping duty imposed by Article 1 shall not apply to
    - urea ammonium nitrate fertilizer exported by the following US companies :
       Agrico Chemical Company , BCM Incorporated, Kaiser Aluminum Domestic and
        International Sales Corporation , Columbia Nitrogen Corporation, Allied
                                                                                   Corporation
        Chemical   Corporation , International Ore and Fertilizer Corporation , Interore / i n c£
and    Transcontinental Fertilizer Corporation ,.                                                 f
                                                                                                  I
                                  Artic le 3                                             ■         r
                                                                                                   !
       The amounts secured
                     secured by
                              by way
                                 way of
                                      of provisional
                                         provisional duty
                                                       duty pursuant
                                                            pursuant toto Regulation
                                                                          Regulation (( EEC)
                                                                                        EEC)       ji
       No 2182 / 80 shall be definitively collected at a rate of
                     1 « II    !<•••.«   I    II  .  I   .        _  »
                                                                                                    j
                                                                                                    i
                                                                                                   !
       - 10% for imports made by Unie van Kunstmestfabrieken , Netherlands from                    S
          Columbia Nitrogen Corporation ;
       - 7„6% for imports made by Essochem Belgium from Exxon Chemical International
          Supply Company ;                                                      • ■' -           J
       - 5% for imports of Kaiser product made by Comagri SA , France from                        f
                            /
                                                                                                  I
          Transcontinental Fertilizer Corporation ;
       - 6„5% for all other imports with the exception of imports of Agrico product
          made by Helm Dungemittel GmbH, Germany from Intsel Corporation , New York               ,
          and all importss of urea ammonium nitrate solution fertilizer exported by               i
          Agrico Chemical Company on which the amounts secured shall not be
          definitively collected *                                                                i
                                                                                                  !
                                  Article 4
        This Regulation shall enter into force on the day 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                                           The Council