Brosmann Footwear (HK) Ltd and Others v Council of the European Union.
Date: 2012-02-02
32. It is necessary to point out that the burden of proof lies with the producer wishing to claim MET under Article 2(7)(b) of the basic regulation. To that end, the first subparagraph of Article 2(7)(c) provides that the claim submitted by such a producer must contain sufficient evidence, as laid down in that provision, that the producer operates under market economy conditions. Accordingly, there is no obligation on the EU institutions to prove that the producer does not satisfy the conditions laid down for the recognition of such status. On the contrary, it is for the EU institutions to assess whether the evidence supplied by the producer concerned is sufficient to show that the criteria laid down in the first subparagraph of Article 2(7)(c) of the basic regulation are fulfilled in order to grant it MET and it is for the EU judicature to examine whether that assessment is vitiated by a manifest error.
36. However, the General Court erred in law in so far as it held that the Commission was not required to examine MET claims under Article 2(7)(b) and (c) of the basic regulation from non-sampled traders.
37. To that effect, it must be noted, first, that Article 2(7) of the basic regulation is one of the provisions of that regulation concerned solely with the determination of normal value, whereas Article 17 of that regulation — on sampling — is one of the provisions relating, inter alia, to the methods available for determining the dumping margin. Thus, the provisions differ in content and purpose.
38. Second, the obligation on the Commission to adjudicate upon a claim from a trader wishing to claim MET is clear from the very wording of Article 2(7)(b) of the basic regulation. That provision lays down the obligation to determine the normal value in accordance with Article 2(1) to (6), if it is shown, on the basis of properly substantiated claims by one or more producers, that market economy conditions prevail for those producers. Such an obligation concerning the recognition of the economic conditions under which each producer operates, in respect of the manufacture and sale of the like product concerned, is not affected by the manner in which the dumping margin is to be calculated.
39. Third, under the second subparagraph of Article 2(7)(c) of the basic regulation, a determination whether the producer meets the criteria referred to in the first subparagraph of that provision in order to claim MET is to be made within three months of the initiation of the investigation.
40. Consequently, the first three grounds of appeal relied on by the appellants in support of their appeal must be upheld, inasmuch as they are based upon an infringement of Article 2(7) of the basic regulation. Therefore, the judgment under appeal must be set aside without the need to examine the other grounds of appeal.
The action at first instance
42. It follows, first of all, from paragraphs 36 to 40 above that the Commission ought to have examined the substantiated claims submitted to it by the appellants pursuant to Article 2(7)(b) and (c) of the basic regulation for the purpose of claiming MET in the context of the anti‑dumping proceeding the subject of the contested regulation. It must next be found that it cannot be ruled out that such an examination would have led to a definitive anti-dumping duty being imposed on the appellants other than the 16.5% duty applicable to them pursuant to Article 1(3) of the contested regulation. It is apparent from that provision that a definitive anti‑dumping duty of 9.7% was imposed on the only Chinese trader in the sample which obtained MET. As is apparent from paragraph 38 above, had the Commission found that the market economy conditions prevailed also for the appellants, they ought, when the calculation of an individual dumping margin was not possible, also to have benefited from the same rate.
43. In those circumstances, the contested regulation must be annulled in so far as it relates to the appellants.
Costs