CELEX: 51987PC0384
Language: en
Date: 1987-07-28
Title: Proposal for a COUNCIL REGULATION (EEC) amending Regulation (EEC) No 2786/83 imposing a definitive anti-dumping duty on imports of copper sulphate originating in Czechoslovakia and the USSR (presented by the Commission)

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Vol. 1987/0211
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In accordance with Council Regulation (EEC, Euratom) No 354/83 of 1 February 1983 concerning
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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
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Verschlusssachen als herabgestuft angesehen.
 ---pagebreak---    COMMISSION OF THE EUROPEAN COMMUNITIES
                                                            COM(87 ) 384 final
                                                            Brussels , 28 July 1987
                                             Proposal for a
                                   COUNCIL REGULATION ( EEC )
    amending Regulation ( EEC ) No 2786 / 83 imposing a definitive anti-dumping
        duty on imports of copper sulphate originating in Czechoslovakia
                                               and the USSR
                               ( presented by the Commission )
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                                                EXPLANATORY 1‘EMORANDUM               ÛûvY) $
       V'
        t 3 1. By Regulation ( EEC ) No 2786 /83 the Council imposed a definitive anti-dumping duty
    Jr i of imports on copper sulphate originating in Czechoslovakia and the USSR and by
           ! Decision No 83 /502 / EEC the Commission accepted an undertaking from one Czech exporter
    it ! of copper sulphate . This undertaking was subsequently amended and accepted by
          ! Decision No 84 /408 / EEC .
    ?
   ? t. “ Subsequently, the Commission , by Regulation (EEC ) No 2908 /84, accepted, an
    •n undertaking offered , inter alia , by the Hungarian exporter of copper sulphate and by
    ;t ; Decision No 104 /85 / EEC an undertaking offered by the Polish exporter of that product .
| 'l t 2- In 1986, the Commission received a request for review of the anti-dumping measures
| in concerning imports of copper sulphate originating in Czechoslovakia, Hungary, Poland
If      l    and the USSR .
        t 3. The investigation established that continued or renewed dunping had been practised
        n by all four countries concerned and that , despite the existence of anti-dunping
        i t measures, material injury had been sustained by the Community industry.
   ■\
   S,i ; 4. The Polish and USSR exporters concerned have offered undertakings ( in the case of
   / 1 J Poland an amended undertaking) which are considered acceptable by the Commission .
   I
      t ' 5. The Regulation imposing a definitive anti-dunping duty on imports of copper
      i « sulphate originating in Czechoslovakia and the USSR should accordingly be amended to
      i ■: exempt the USSR imports , to adjust the duty relative to Czech imports and to impose a
      t      definitive anti-dumping duty on Hungarian imports .
 ---pagebreak---                                                                                ORIGINAI.
                                        Proposal for a
                                   COUNCIL REGULATION ( EEC )
amending Regulation ( EEC ) No 2786 /83 imposing a definitive anti-dumping              duty on
 imports of copper sulphate oriainating in Czechoslovakia and the USSR .
THE COUNCIL OF THE EUROPEAN COMMUNITIES ,
Having regard to the Treaty establishing the European Economic Community ,
Having regard to Regulation ( EEC ) No 2176 / 84 of 23 July 1984 on protection against
dumped or sub si di zed imports f rom count ries not members of the European Economi c Communi ty (1 ) ,
as amended by Regulation ( EEC ) No 1761 / 87 ( 2 ), and inparticularArticle14 thereof ,
Having    regard to the proposal submitted by the Commission after consultation within
fhe Advisory Committee as provided for under the above Regulation ,
Whereas :
A.   PROCEDURE
1 . By Regulation ( EEC ) No 2786 /83     ( 3 ) the Council imposed a definitive anti-dumping
duty of imports of copper sulphate originating in Czechoslovakia and the USSR and by
Decision    No  83 /502 / EEC ( 4) the  Commission accepted an undertaking from one Czech
exporter of copper sulphate .       This undertaking was subsequently amended and accepted
by Decision No 84 /408 / EEC ( 5 ).
2 . In 1986 , the Commission received a request for review of the anti-dumping measures
concerning imports of copper sulphate originating in Czechoslovakia , Hungary , Poland
and the USSR lodged by the European Federation of Chemical Manufacturers Associations
representing a major proportion of Community output of copper sulphate . This review
request contained evidence of changed circumstances sufficient to justify the need
for review and accordingly the Commission announced , by a Notice published ( 6 ) in the
Official Journal of the European Communities , the opening of a review investigation
( 1 ) OJ No L 201 , 30.7.1984 , p. 1 .
( 2 ) OJ No L 167 , 26.6.1987 , p. 9 .
( 3 ) OJ No L 274, 7.10.1983 , p. 1 .
( 4 ) OJ No L 281 , 13.10.1983 , p. 22 .
( 5 ) OJ No L 225, 22.8.1984 , D. 22 .
( 6 ) OJ N° C 200     9.8.1986 , p. 4 .
 ---pagebreak---                                                          - 2 -
    i i concerning imports of copper sulphate originating in Czechoslovakia , Hungary , Poland
 ■!« and the USSR , falling within subheading ex 28.38 All of the Common Customs Tariff ,
        and corresponding to NIMEXE code           28.38-27.
   i J 3.     The Commission officially      so   advised the   exporters and   importers   known   to be
   e ;  concerned and the Community producers and gave the parties directly concerned the
   r >  opportunity to make known their views in writing and to request a hearing .
  r i   Host exporters concerned , some importers and all complainant Community producers made
!i *    their views known in writing and requested and were granted hearings .
        Ho submissions were made by or on behalf of Community purchasers or processors of the
      t product .
             The Commission sought and verified all information it deemed to be necessary and
   it carried out investigations at the premises of the following :
    «* – EEC producers :
    il    – La Cornubia SA, Bordeaux , France ,
   i i        NV Metallo-chimique , Beerse , Belgium
   il     – Manica Spa , Rovereto , Italy
  i     Hie     Commission   requested    and   received    detailed  written    submissions    from    all
i ■ complainant Community producers , most exporters and some importers and verified the
  i i    information therein to the extent considered necessary .
 i i    The investigation of dumping covered the period January to July 1986 inclusive .
  f \   B.   NORMAL VALUE
  r •   5.    In order to establish whether there         was renewed dumping of      imports of copper
  i *   sulphate from Czechoslovakia , Hungary , Poland and the USSR the Commission had to take
  r »   account    of the   fact  that   these    countries  do   not have  market   economies    and   the
  i >   Commission    therefore   had   to   base   its   determinations   on the   normal   value    in  a
 i      market- economy country . In this connection , the Community industry had suggested the
 u      United States as an appropriate analogue market . All US producers of copper sulphate
 ?      known to the Commission were , however , unwilling to cooperate in the investigation ,
i       Some of the exporters concerned had objected to the use of the US market and one had
*:      suggested Thailand as being a more appropriate choice .           Other exporters objected to
t;      the    choice of Thailand     arguing    that the relatively small quantities produced in
 ---pagebreak---                                            - 3 -
Thailand would result in high unit costs and commensurately higher prices . One
exporter suggested the price actually paid in the Community as alternative basis for
determining normal value .
6 . Following enquiries by the Commission , however , the result of which were
substantiated by investigation at the premises of two Thai producers of copper
sulphate , it was established that there were no extraordinary differences between
Thai production processes and those of the exporting countries concerned . In
addition , price levels in Thailand , were somewhat lower both than those in those
Community and those alleged to exist in the United States , and , despite the
relatively low quantities produced , were in reasonable proportion to production
costs .
The Commission therefore concluded that it would be appropriate and not unreasonable
to determine normal value on the basis of domestic prices in Thailand . Indeed if
Thailand cannot be ruled out as an analogue country then it is not legally
appropriate to use Community prices as the basis for normal value .
The normal value thus established for the reference period , was higher than that
established during the previous investigations relating to the exporting countries
concerned , the most significant factor having been the effect on prices of an
increase in the cost of copper , which comprises the major element in the production
costs of copper sulphate . This increase , together with increases in the Community
producers' fixed costs , considerably outweighed the beneficial effects on these
producers' costs of a reduction in the cost of energy .
C. EXPORT PRICE
7 . Export prices were determined on the basis of the prices actually paid or payable
for the products sold for export to the Community .
D. COf'PARISON
8. In comparing normal value with export prices , the Commission took account , where
appropriate , of differences affecting price comparability . In particular , account was
taken of differences in purity and copper content , sufficient evidence of which was
supplied by the Polish and USSR exporters .
In all comparisons , account was taken of differences in conditions and terms of
payment and adjustment was made , where appropriate , to allow export prices and normal
values to be on a comparable basis in this respect .
 ---pagebreak---                                            - 4 -
E. MARGINS
9 . The above preliminary examination of the facts showed the existence of dumping in
respect of imports of copper sulphate originating in Czechoslovakia , Hungary, Poland
and the USSR the margin of dumping being equal to the amount by which the normal
value as established exceeded the prices for export to the Community .
These margins varied according to the exporter concerned , and expressed as a
percentage of total cif values for each of the exporters investigated were as
follows :
Czechoslovakia                   25.6%
Hungary                          45.5%
Poland                           44,1%
USSR                             47,9%
F. INJURY
10 . With regard to the injury caused by the dumped imports , the evidence available to
the Commission shows that imports into the Community from Czechoslovakia , Hungary,
Poland and the USSR of copper sulphate have , on a cumulative basis , remained
relatively stable between 1982 and 1986 and have accordingly retained a share of
around 16% of a market in which consumption in the Community has also been fairly
stable .
11 . This situation should be considered in the light of the effect of the
anti-dumping measures imposed between 1983 and 1985 on imports of copper sulphate
originating in , inter alia , the four countries concerned in this proceeding . The
evidence available to the Commission indicated that , while the imposition of
anti-dumping measures may have had an initial downward effect on the sales volumes in
the Community of the individual country or countries concerned these volumes had , at
least to some degree , recovered by the reference period .
12 . In addition , since the imposition of the existing anti-dumping measures relating
to imports from the countries concerned , costs in the Community, particularly for
copper , have increased significantly ( see recital 6 ). Thus , despite the imposition of
these measures , the exporters concerned have been able to significantly undercut the
the prices of the Community producers . During the reference period this undercutting
reached levels of around 25% after anti-dunping duty and involved prices which were
lower than those required to cover the costs of Community producers and provide a
reasonable profit .
13. The consequent impact on the Community industry has been that its sales in the
Community have remained at approximately the same level from 1982 to 1986. This has
 ---pagebreak---                                             - 5 -
meant a continuation of Low capacity utilisation Levels which remained , during this
period , on average , at 40% . The resultant high unit costs , combined with the
depressive effect of the prices of the dumped imports , have led , for the complainant
producers , to continued losses or the inability to obtain a reasonable return on
sales in the Community market , which accounts for almost 90% of their total sales of
copper sulphate .
Furthermore , two Community producers have ceased production of copper sulphate since
1983, at least partially as a result of the impact of the dumped imports . These
closures have led to a reduction in employment in the manufacture of copper sulphate
in the Community .
14 . The Commission has considered whether injury has been caused by other factors
such as reduction in the complainants' sales to third countries , a fall in demand in
the Community or an increase in imports originating in countries other than those
concerned in the present proceeding .
The complainants' sales to third countries remained stable between 1982 and 1986 at
around 10% of total sales . Community consumption has also remained relatively stable
during this period . As regards imports from countries other than the four concerned ,
anti-dumping measures were taken in 1984 ( 7 ) concerning Bulgarian copper sulphate
and , concerning the Yugoslav product , most recently in 1985 18). Since these measures
were taken , the volumes imported from these countries have fallen and imports from
other countries have remained , as a whole , at approximately the same levels .
Thus , the volume of dumped imports from the four countries concerned and the prices
at which they were sold in the Community during the reference period has led the
Commission to determine that the effects of the dumped imports of copper sulphate
originating in Czechoslovakia , Hungary , Poland and the USSR , taken in isolation , have
to be considered as causing material injury to the Community industry concerned .
G. COMMUNITY INTEREST
15 . In view of the serious difficulties facing the Community industry , and in
particular the fact that two Community producers have ceased production since 1983,
the Commission has come to the conclusion that it is in the Community 's interest that
action be taken .
( 7 ) 0J No L 275, 18.10.1984, p. 12
(8 ) 0J No L 296, 8.11.1985, p. 26.
 ---pagebreak---                                             - 6 -
H. UNDERTAKINGS
16 . The Polish and USSR exporters concerned , having been informed of the main
findings of the review investigation , offered undertakings, amended in the case of
the Polish exporter , concerning their exports of copper sulphate to the Community and
the Commission , in a Decision published in the Official Journal of the European
Communities of even date with the publication hereof , has accepted these undertakings
and terminated the investigation as it concerned imports of copper sulphate
originating in Poland and the USSR . Regulation ( EEC ) No 2786 /83 should accordingly be
amended to the extent that it imposes a definitive anti-dumping duty on imports of
copper sulphate originating in the USSR .
I. DUTY
17 . The Czech and Hungarian exporters concerned , having been informed of the main
findings of the review investigation , did not offer to amend their undertakings in a
manner which would eliminate the injury caused by the dumped imports . Accordingly ,
the Commission has withdrawn acceptance of the undertakings previously offered by
these two exporters and has proposed that definitive duties be imposed .
18. Having regard to the extent of the injury caused , the rate of such duty should be
less than the dumping margins provisionally established but adequate to remove the
injury caused . Having taken into account , on the one hand , the selling price
necessary to cover the production costs of the Community industry and to provide an
adequate return and , on the other hand, the prices at which the dumped imports are
offered for sale in the Community , the Commission determined the amount of duty
necessary to eliminate the injury to be 5% and 19% in the case of Czech and Hungarian
imports respectively or , in both cases , to avoid possible circumvention , the
difference of the price per tonne net free at Community frontier and 522 ECU for
pentahydrate copper sulphate and 630 ECU for monohydrate copper sulphate , whichever
is the higher between the variable and ad valorem , types of duty . Regulation (EEC ) No
2786 /83 should accordingly be amended to the extent that it concerns imports of
copper sulphate originating in Czechoslovakia .
HAD ADOPTED THIS REGULATION :
                                         Article 1
Article 1 of Regulation ( EEC ) No 2786 /83 is hereby replaced by the following :
 ---pagebreak---                                        " Artide 1
1.  A definitive anti-dumping duty is hereby imposed on imports of copper sulphate ,
falling within subheading ex 28.38 A II of the Common Customs Tariff , correspond i no
to NIMEXE code 28.38-27 and originating in Czechoslovakia and Hungary .
2 . The amount of the duty shall be equal to :
either   the   amount by which the    price , per   tonne net , free- at- Community - frontier,
before duty , is less than :
- 522 ECU for pentahydrate copper sulphate originating in Czechoslovakia and Hungary ,
- 630 ECU for monohydrate copper sulphate originating in Hungary ,
or the following percentages of that price :
- 5% for copper sulphate originating in Czechoslovakia , and
- 19% for both pentahydrate and monohydrate copper sulphate originating in Hungary ,
whichever is the higher .
3.  Tt>e  provisions  in  force with  regard    to customs duties shall apply ."
                                        Article 2
This Regulation shall enter      into force on the day following its publication in the
Official Journal of the European Communities .
This   Regulation   shall  be binding  in   its   entirety and  directly applicable      in all
Member   States .
Done at Brussels ,                                For the Council