Zhejiang Aokang Shoes Co., Ltd v Council of the European Union.
Date: 2012-11-15
24. In that connection, it should be stressed 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. By contrast, 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 (see Brosmann Footwear (HK) and Others  v Council , paragraph 32).
29. In the judgment in Brosmann Footwear (HK) and Others  v Council , which annulled the contested regulation in so far as it concerned four other companies, it being held that there was an infringement of Article 2(7) of the basic regulation, the Court found, in paragraph 38 of that judgment, that 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 that regulation.
30. That provision lays down the obligation to determine the normal value in accordance with Article 2(1) to (6) of the basic regulation 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 (see Brosmann Footwear (HK) and Others  v Council , paragraph 38).
31. Under the second subparagraph of Article 2(7)(c) of the basic regulation, such an obligation must be fulfilled within three months of the initiation of the investigation.
32. It follows that the General Court was wrong to reject, in paragraph 91 of the judgment under appeal, the appellant’s argument that Article 2(7)(b) and (c) of the basic regulation obliged the Commission to examine MET/IT claims from non-sampled traders.
33. In that connection, it must be noted 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 – concerning sampling – is one of the provisions relating to, inter alia, the methods available for determining the dumping margin. Thus, the provisions differ in content and purpose (see Brosmann Footwear (HK) and Others  v Council , paragraph 37).
34. Consequently, the first ground of appeal relied on by the appellant in support of its appeal must be upheld, inasmuch as it is based upon an infringement of Article 2(7) of the basic regulation. The judgment under appeal must for that reason be set aside, without there being any need to examine the second ground of appeal.
The action at first instance
36. It follows, first, from paragraphs 29 to 34 of the present judgment that the Commission ought to have examined the substantiated claim submitted to it by the appellant 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 which was the subject of the contested regulation. It must be held, second, that it cannot be ruled out that such an examination might have led to the imposition on the appellant of a definitive anti-dumping duty different from the 16.5% duty applicable to it pursuant to Article 1(3) of the contested regulation. Indeed, 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 42 of the judgment in Brosmann Footwear (HK) and Others  v Council , however, had the Commission found that market economy conditions prevailed also for the appellant, the latter ought, when the calculation of an individual dumping margin was not possible, also to have benefited from that same rate.
37. In those circumstances, the contested regulation must be annulled in so far as it concerns the appellant.
The temporal effects of the present judgment
39. In that connection, it must be held that, since the contested regulation is annulled only in relation to the appellant, the financial implications to which the Commission refers stem not from the operative part of the present judgment, but from the interpretation of the basic regulation according to which the Commission and the Council are required – when certain exporting producers established in a non-market economy country have been sampled, pursuant to Article 17 of that regulation, and the calculation of an individual dumping margin for non-sampled exporting producers is not possible – to apply, pursuant to Article 9(6) of that regulation, to any non-sampled trader which ought to be granted MET in terms of Article 2(7)(b) of that regulation the weighted average duty of the sampled traders benefiting from MET.
40. The Court had already given such an interpretation of the basic regulation in its judgment in Brosmann Footwear (HK) and Others v Council  without limiting the temporal effects of that interpretation.
41. In those circumstances, the request that the temporal effects of the present judgment be limited must be rejected.
Costs