title: Council Implementing Regulation (EU) No 579/2010 of 29 June 2010 amending Regulation (EC) No 367/2006 imposing a definitive countervailing duty on imports of polyethylene terephthalate (PET) film originating in India

text:
               2.7.2010

               EN

               Official Journal of the European Union

               L 168/1

         COUNCIL IMPLEMENTING REGULATION (EU) No 579/2010
   of 29 June 2010
   amending Regulation (EC) No 367/2006 imposing a definitive countervailing duty on imports of polyethylene terephthalate (PET) film originating in India
   THE COUNCIL OF THE EUROPEAN UNION,
   Having regard to the Treaty on the Functioning of the European Union,
   Having regard to Council Regulation (EC) No 597/2009 of 11 June 2009 on protection against subsidised imports from countries not members of the European Community (1) (‘the basic Regulation’), and in particular Article 19 thereof,
   Having regard to the proposal submitted by the European Commission after consulting the Advisory Committee,
   Whereas:
   A.   PROCEDURE

   I.   Previous investigation and existing countervailing measures

               (1)

               In December 1999, by Regulation (EC) No 2597/1999 (2), the Council imposed a definitive countervailing duty on imports of polyethylene terephthalate (PET) film (‘the product concerned’) currently falling within CN codes ex 3920 62 19 and ex 3920 62 90, originating in India. The investigation which led to the adoption of that Regulation is hereinafter referred to as the ‘original investigation’. The measures took the form of an ad valorem countervailing duty, ranging between 3,8 % and 19,1 % imposed on imports from individually named exporters, with a residual duty rate of 19,1 % imposed on imports of the product concerned from all other companies. The investigation period of the original investigation was 1 October 1997 to 30 September 1998.

               (2)

               In March 2006, by Regulation (EC) No 367/2006 (3), the Council, following an expiry review pursuant to Article 18 of the basic Regulation, maintained the definitive countervailing duty imposed by Regulation (EC) No 2597/1999 on imports of PET film originating in India. The review investigation period was 1 October 2003 to 30 September 2004.

               (3)

               In August 2006, by Regulation (EC) No 1288/2006 (4), the Council, following an interim review concerning the subsidisation of an Indian PET film producer, Garware Polyester Limited (‘Garware’), amended the definitive countervailing duty imposed on Garware by Regulation (EC) No 367/2006.

               (4)

               In September 2007, by Regulation (EC) No 1124/2007 (5), the Council, following a partial interim review concerning the subsidisation of another Indian PET film producer, Jindal Poly Films Limited (‘Jindal’), formerly known as Jindal Polyester Ltd, amended the definitive countervailing duty imposed on Jindal by Regulation (EC) No 367/2006.

               (5)

               In January 2009, by Regulation (EC) No 15/2009 (6), the Council, following a partial interim review initiated by the Commission on its own initiative concerning the subsidisation of five Indian PET film producers, amended the definitive countervailing duty imposed on these companies by Regulation (EC) No 367/2006.

         II.   Existing anti-dumping measures

               (6)

               It should be noted that Jindal Poly Films Limited is subject to an anti-dumping duty of 0 % (7).

         III.   Initiation of a partial interim review

               (7)

               The request for a partial interim review was lodged by Jindal Poly Films Limited, an exporting producer from India (‘the applicant’). The request is limited in scope to the examination of subsidisation as far as the applicant is concerned. The applicant has provided prima facie evidence that the circumstances with regard to subsidisation on the basis of which measures were established have changed significantly and that these changes are of a lasting nature.

               (8)

               Having determined, after consulting the Advisory Committee, that sufficient evidence existed to justify the initiation of a partial interim review, the Commission announced on 9 September 2009, by a notice of initiation published in the Official Journal of the European Union
                   (8) (‘Notice of Initiation’), the initiation of a partial interim review, in accordance with Article 19 of the basic Regulation, limited to the level of subsidisation to the applicant, with a view to determining whether the measures should be removed or amended for the applicant,

               (9)

               The partial interim review investigation would also assess the need, depending on the review findings, to amend the rate of duty currently applicable to imports of the product concerned from exporting producers in the country concerned not individually mentioned in Article 1(2) of Regulation (EC) No 367/2006, i.e. the duty rate as applying to ‘all other companies’ in India.

         IV.   Investigation period

               (10)

               The investigation of the level of subsidisation covered the period from 1 April 2008 to 31 March 2009 (‘review investigation period’ or ‘RIP’).

         V.   Parties concerned by the investigation

               (11)

               The Commission officially informed the applicant, the Government of India (GOI), Du Pont Tejin Films, Luxembourg, Mitsubishi Polyester Film, Germany, Toray Plastics Europe, France and Nurell, Italy, which represent a major proportion of Union PET film production (hereinafter ‘the Union industry’), of the initiation of the partial interim review investigation. Interested parties were given the opportunity to make their views known in writing and to request a hearing within the time limit set out in the Notice of Initiation.

               (12)

               All interested parties, who so requested and showed that there were particular reasons why they should be heard, were granted a hearing.

               (13)

               The written and oral comments submitted by the parties were considered and, where appropriate, taken into account.

               (14)

               In order to obtain the information necessary for its investigation, the Commission sent a questionnaire to the applicant. In addition, a questionnaire was sent to the GOI.

               (15)

               Replies from the questionnaire were received from the applicant and from the GOI.

               (16)

               The Commission sought and verified all information it deemed necessary for the determination of subsidisation. Verification visits were carried out at the premises of the applicant and at the premises of the GOI in Delhi.

         VI.   Disclosure and comments on procedure

               (17)

               The GOI and the other interested parties were informed of the essential facts and considerations upon which it was intended to propose to amend the duty rate applicable to the applicant. They were given a reasonable time to comment. All submissions and comments were taken duly into consideration as set out below.

         B.   PRODUCT CONCERNED

               (18)

               The product covered by this review is the same product as the one concerned by Regulation (EC) No 367/2006, namely polyethylene terephthalate (PET) film falling within CN codes ex 3920 62 19 and ex 3920 62 90 originating in India.

         C.   SUBSIDISATION

   1.   Introduction

               (19)

               On the basis of the information submitted by the GOI and the other interested parties and the replies to the Commission’s questionnaire, the following schemes, which allegedly involve the granting of subsidies, were investigated:

                           (a)

                           Advance Authorization Scheme (formerly known as Advance Licence Scheme);

                           (b)

                           Duty Entitlement Passbook Scheme;

                           (c)

                           Export Promotion Capital Goods Scheme;

                           (d)

                           Export Credit Scheme.

               (e)

               Package Scheme of Incentives (PSI)

               (20)

               The schemes (a) to (c) specified above are based on the Foreign Trade (Development and Regulation) Act 1992 (No 22 of 1992) which entered into force on 7 August 1992 (‘Foreign Trade Act’). The Foreign Trade Act authorises the GOI to issue notifications regarding the export and import policy. These are summarised in ‘Export and Import Policy’ documents, which are issued by the Ministry of Commerce every five years and updated regularly. One Export and Import Policy document is relevant to the RIP of this case, i.e. the five-year plan relating to the period 1 September 2004 to 31 March 2009 (‘EXIM-policy 04-09’). In addition, the GOI also sets out the procedures governing the EXIM-policy 04-09 in a ‘Handbook of Procedures – 1 September 2004 to 31 March 2009, Volume I’ (‘HOP I 04-09’). The Handbook of Procedure is also updated on a regular basis.

               (21)

               The Export Credit Scheme specified above under (d) is based on sections 21 and 35A of the Banking Regulation Act 1949, which allow the Reserve Bank of India (‘RBI’) to direct commercial banks in the field of export credits.

               (22)

               The scheme specified above under (e) is managed by State authorities in India.

         2.   Advance Authorisation Scheme (‘AAS’)

   (a)   Legal basis

               (23)

               The detailed description of the scheme is contained in paragraphs 4.1.1 to 4.1.14 of the EXIM-policy 04-09 and chapters 4.1 to 4.30 of the HOP I 04-09. This scheme was called Advance Licence Scheme during the previous review investigation that led to the imposition by Regulation (EC) No 367/2006 of the definitive countervailing duty currently in force.

         (b)   Eligibility

               (24)

               The AAS consists of six sub-schemes, as described in more detail in recital (25) below. Those sub-schemes differ , inter alia in the scope of eligibility. Manufacturer-exporters and merchant-exporters ‘tied to’ supporting manufacturers are eligible for the AAS physical exports and for the AAS for annual requirement. Manufacturer–exporters supplying the ultimate exporter are eligible for AAS for intermediate supplies. Main contractors which supply to the ‘deemed export’ categories mentioned in paragraph 8.2 of the EXIM-policy 04-09, such as suppliers of an export oriented unit (‘EOU’), are eligible for AAS deemed export. Eventually, intermediate suppliers to manufacturer-exporters are eligible for ‘deemed export’ benefits under the sub-schemes Advance Release Order (‘ARO’) and back to back inland letter of credit.

         (c)   Practical implementation

               (25)

               Advance authorisations can be issued for:
               (i)   Physical exports: This is the main sub-scheme. It allows for duty free import of input materials for the production of a specific resulting export product. ‘Physical’ in this context means that the export product has to leave Indian territory. An import allowance and export obligation including the type of export product are specified in the licence;
               (ii)   Annual requirement: Such an authorisation is not linked to a specific export product, but to a wider product group (e.g. chemical and allied products). The licence holder can – up to a certain value threshold set by its past export performance – import duty free any input to be used in manufacturing any of the items falling under such a product group. It can choose to export any resulting product falling under the product group using such duty-exempt material;
               (iii)   Intermediate supplies: This sub-scheme covers cases where two manufacturers intend to produce a single export product and divide the production process. The manufacturer-exporter who produces the intermediate product can import duty free input materials and can obtain for this purpose an AAS for intermediate supplies. The ultimate exporter finalises the production and is obliged to export the finished product;
               (iv)   Deemed exports: This sub-scheme allows a main contractor to import inputs free of duty which are required in manufacturing goods to be sold as ‘deemed exports’ to the categories of customers mentioned in paragraph 8.2(b) to (f), (g), (i) and (j) of the EXIM policy 04-09. According to the GOI, deemed exports refer to those transactions in which the goods supplied do not leave the country. A number of categories of supply is regarded as deemed exports provided the goods are manufactured in India, e.g. supply of goods to an EOU or to a company situated in a special economic zone (‘SEZ’);
               (v)   ARO: The AAS holder intending to source the inputs from indigenous sources, in lieu of direct import, has the option to source them against AROs. In such cases the Advance Authorisations are validated as AROs and are endorsed to the indigenous supplier upon delivery of the items specified therein. The endorsement of the ARO entitles the indigenous supplier to the benefits of deemed exports as set out in paragraph 8.3 of the EXIM-policy 04-09 (i.e. AAS for intermediate supplies/deemed export, deemed export drawback and refund of terminal excise duty). The ARO mechanism refunds taxes and duties to the supplier instead of refunding the same to the ultimate exporter in the form of drawback/refund of duties. The refund of taxes/duties is available both for indigenous inputs as well as imported inputs;
               (vi)   Back to back inland letter of credit: This sub-scheme again covers indigenous supplies to an Advance Authorisation holder. The holder of an Advance Authorisation can approach a bank for opening an inland letter of credit in favour of an indigenous supplier. The authorisation will be invalidated by the bank for direct import only in respect of the value and volume of items being sourced indigenously instead of importation. The indigenous supplier will be entitled to deemed export benefits as set out in paragraph 8.3 of the EXIM-policy 04-09 (i.e. AAS for intermediate supplies/deemed export, deemed export drawback and refund of terminal excise duty).

               (26)

               The applicant received concessions under the AAS linked to the product concerned during the RIP. The applicant made use of two of the sub-schemes, i.e. (i) AAS physical exports and (ii) AAS for deemed exports. It is therefore not necessary to establish the countervailability of the remaining unused sub-schemes.

               (27)

               For verification purposes by the Indian authorities, an Advance Authorisation holder is legally obliged to maintain ‘a true and proper account of consumption and utilisation of duty free imported/domestically procured goods’ in a specified format (chapters 4.26, 4.30 and Appendix 23 HOP I 04-09), i.e. an actual consumption register. This register has to be verified by an external chartered accountant/cost and works accountant who issues a certificate stating that the prescribed registers and relevant records have been examined and the information furnished under Appendix 23 is true and correct in all respects. Nevertheless, the aforesaid provisions apply only to Advance Authorisations issued on or after 13 May 2005. For all Advance Authorisations or Advance Licences issued before that date, holders are requested to follow the previously applicable verification provisions, i.e. to keep a true and proper account of licence-wise consumption and utilisation of imported goods in the specified format of Appendix 18 (chapter 4.30 and Appendix 18 HOP I 02-07).

               (28)

               With regard to the sub-schemes used during the RIP by the applicant, i.e. physical exports and deemed exports, both the import allowance and the export obligation are fixed in volume and value by the GOI and are documented on the Authorisation. In addition, at the time of import and of export, the corresponding transactions are to be documented by Government officials on the Authorisation. The volume of imports allowed under the AAS is determined by the GOI on the basis of standard input-output norms (‘SIONs’). SIONs exist for most products including the product concerned and are published in the HOP II 04-09. The most recent changes in the SIONs for PET film and PET chips, an intermediate product, were revised in September 2005.

               (29)

               Imported input materials are not transferable and have to be used to produce the resultant export product. The export obligation must be fulfilled within a prescribed time frame after issuance of the licence (24 months with two possible extensions of 6 months each).

               (30)

               The scheme as described above has not changed since the last partial interim review concerning subsidisation for the applicant which was concluded in January 2009. However, the benefit under this scheme has substantially decreased as shown in recital (39) below.

               (31)

               The current interim review investigation established that the verification requirements stipulated by the Indian authorities were not honoured and not yet tested in practice. The applicant did not maintain a system whereby it could be verified which inputs were consumed in the production of the exported product and in what amounts, as stipulated by the Foreign Trade Policy (FTP) 2004 to 2009 (Appendix 23) and in accordance with Annex II(II)(4) of the basic Regulation. The consumption register was never inspected by the GOI.

               (32)

               Changes in the administration of the FTP 2004 to 2009, which became effective in autumn of 2005 (mandatory sending of the consumption register to the India authorities in the context of the redemption procedure) has not yet been applied in the case of the applicant. Thus, the de facto implementation of this provision could not be verified at this stage.

         (d)   Conclusion

               (33)

               The exemption from import duties is a subsidy within the meaning of Article 3(1)(a)(ii) and Article 3(2) of the basic Regulation, i.e. a financial contribution of the GOI which conferred a benefit upon the investigated exporters.

               (34)

               In addition, AAS physical exports and AAS for deemed exports are clearly contingent in law upon export performance, and therefore deemed to be specific and countervailable under Article 4(4), first subparagraph, point (a) of the basic Regulation. Without an export commitment a company cannot obtain benefits under these schemes.

               (35)

               The two sub-schemes used in the present case cannot be considered permissible duty drawback systems or substitution drawback systems within the meaning of Article 3(1)(a)(ii) of the basic Regulation. They do not conform to the rules laid down in Annex I item (i), Annex II (definition and rules for drawback) and Annex III (definition and rules for substitution drawback) of the basic Regulation. The GOI did not effectively apply either its new or its old verification system or procedure to confirm whether and in what amounts inputs were consumed in the production of the exported product (Annex II(II)(4) of the basic Regulation and, in the case of substitution drawback schemes, Annex III(II)(2) of the basic Regulation). The SIONs for the product concerned were not sufficiently precise. The SION’s themselves cannot be considered a verification system of actual consumption because the design of those standard norms does not enable the GOI to verify with sufficient precision what amounts of inputs were consumed in the export production In addition, the GOI did not carry out a further examination based on actual inputs involved, although this would normally need to be carried out in the absence of an effectively applied verification system (Annex II(II)(5) and Annex III(II)(3) to the basic Regulation).

               (36)

               These two sub-schemes are therefore countervailable.

         (e)   Calculation of the subsidy amount

               (37)

               In the absence of permitted duty drawback systems or substitution drawback systems, the countervailable benefit is the remission of total import duties normally due upon importation of inputs. In this respect, it is noted that the basic Regulation does not only provide for the countervailing of an ‘excess’ remission of duties. According to Article 3(1)(a)(ii) and Annex I(i) of the basic Regulation only when the conditions of Annexes II and III of the basic Regulation are met that the excess remission of duties can be countervailed. However, these conditions were not fulfilled in the present case. Thus, if an adequate monitoring process is not demonstrated, the above exception for drawback schemes is not applicable and the normal rule of the countervailing of the amount of unpaid duties (revenue forgone), applies, rather than of any purported excess remission. As set out in Annexes II(II) and III(II) of the basic Regulation the burden is not upon the investigating authority to calculate such excess remission. To the contrary, according to Article 3(1)(a)(ii) of the basic Regulation, the investigating authority only has to establish sufficient evidence to refute the appropriateness of an alleged verification system.

               (38)

               The subsidy amount for the applicant, which used the AAS, was calculated on the basis of import duties forgone (basic customs duty and special additional customs duty) on the material imported under the two sub-schemes during the RIP (numerator). In accordance with Article 7(1)(a) of the basic Regulation, fees necessarily incurred to obtain the subsidy were deducted from the subsidy amount where justified claims were made. In accordance with Article 7(2) of the basic Regulation, this subsidy amount was allocated over the export turnover of the product concerned during the RIP as appropriate denominator, because the subsidy is contingent upon export performance and was not granted by reference to the quantities manufactured, produced, exported or transported.

               (39)

               The subsidy rate established in respect of this scheme for the applicant for the RIP amounts to 0,7 %.

         3.   Duty Entitlement Passbook Scheme (‘DEPBS’)

   (a)   Legal Basis

               (40)

               The detailed description of the DEPBS is contained in paragraph 4.3 of the EXIM-policy 04-09 and in chapter 4 of the HOP I 04-09.

         (b)   Eligibility

               (41)

               Any manufacturer-exporter or merchant-exporter is eligible for this scheme.

         (c)   Practical implementation of the DEPBS

               (42)

               An eligible exporter can apply for DEPBS credits which are calculated as a percentage of the value of products exported under this scheme. Such DEPBS rates have been established by the Indian authorities for most products, including the product concerned. They are determined on the basis of SIONs, taking into account a presumed import content of inputs in the export product and the customs duty incidence on such presumed imports, regardless of whether import duties have actually been paid or not.

               (43)

               To be eligible for benefits under this scheme, a company must export. At the time of the export transaction, a declaration must be made by the exporter to the authorities in India indicating that the export is taking place under the DEPBS. In order for the goods to be exported, the Indian customs authorities issue an export shipping bill, during the dispatch procedure. This document shows, inter alia, the amount of DEPBS credit which is to be granted for that export transaction. At this point in time, the exporter knows the benefit it will receive. Once the customs authorities issue an export shipping bill, the GOI has no discretion over the granting of a DEPBS credit. The relevant DEPBS rate to calculate the benefit is that which applied at the time the export declaration is made.

               (44)

               DEPBS credits are freely transferable and valid for a period of 12 months from the date of issue. They can be used for payment of customs duties on subsequent imports of any goods unrestrictedly importable, except capital goods. Goods imported against such credits can be sold on the domestic market (subject to sales tax) or used otherwise.

               (45)

               Application for DEPBS credits are electronically filed and can cover an unlimited amount of export transactions. De facto no strict deadlines apply to DEPBS credits. The electronic system used to manage DEPBS does not automatically exclude export transactions exceeding the deadline submission periods mentioned in chapter 4.47 of the HOP I 04-09. Furthermore, as clearly provided in chapter 9.3 of the HOP I 04-09, applications received after the expiry of submission deadlines can always be considered with the imposition of a minor penalty fee (i.e. 10 % of the entitlement).

               (46)

               It was found that the applicant used this scheme during the RIP.

         (d)   Conclusions on the DEPBS

               (47)

               The DEPBS provides subsidies within the meaning of Article 3(1)(a)(ii) and Article 3(2) of the basic Regulation. A DEPBS credit is a financial contribution by the GOI, since the credit will eventually be used to offset import duties, thus decreasing the GOI’s duty revenue which would otherwise be due. In addition, the DEPBS credit confers a benefit upon the exporter, because it improves its liquidity.

               (48)

               Furthermore, the DEPBS is contingent in law upon export performance, and therefore deemed to be specific and countervailable under Article 4(4), first subparagraph, point (a) of the basic Regulation.

               (49)

               This scheme cannot be considered a permissible duty drawback system or substitution drawback system within the meaning of Article 3(1)(a)(ii) of the basic Regulation. It does not conform to the strict rules laid down in Annex I item (i), Annex II (definition and rules for drawback) and Annex III (definition and rules for substitution drawback) of the basic Regulation. An exporter is under no obligation to actually consume the goods imported free of duty in the production process and the amount of credit is not calculated in relation to actual inputs used. Moreover, there is no system or procedure in place to confirm which inputs are consumed in the production process of the exported product or whether an excess payment of import duties occurred within the meaning of item (i) of Annex I, and Annexes II and III, of the basic Regulation. Lastly, an exporter is eligible for the DEPBS benefits regardless of whether it imports any inputs at all. In order to obtain the benefit, it is sufficient for an exporter to simply export goods without demonstrating that any input material was imported. Thus, even exporters which procure all of their inputs locally and do not import any goods which can be used as inputs are still entitled to benefit from the DEPBS.

         (e)   Calculation of the subsidy amount

               (50)

               In accordance with Articles 3(2) and 5 of the basic Regulation and the calculation methodology used for this scheme in Regulation (EC) No 367/2006, the amount of countervailable subsidies was calculated in terms of the benefit conferred on the recipient found to exist during the RIP. In this regard, it was considered that the benefit is conferred on the recipient at the point in time when an export transaction is made under this scheme. At this moment, the GOI is liable to forego the customs duties, which constitutes a financial contribution within the meaning of Article 3(1)(a)(ii) of the basic Regulation. Once the customs authorities issue an export shipping bill which shows, inter alia, the amount of DEPBS credit which is to be granted for that export transaction, the GOI has no discretion as to whether or not to grant the subsidy. Furthermore, the cooperating exporting producer booked the DEPBS credits on an accrual basis as income.

               (51)

               Where justified claims were made, fees necessarily incurred to obtain the subsidy were deducted from the credits so established to arrive at the subsidy amount as numerator, pursuant to Article 7(1)(a) of the basic Regulation. In accordance with Article 7(2) of the basic Regulation this subsidy amount has been allocated over the export turnover of the product concerned during the review investigation period as appropriate denominator, because the subsidy is contingent upon export performance and it was not granted by reference to the quantities manufactured, produced, exported or transported.

               (52)

               The subsidy rate established in respect of this scheme for the applicant for the RIP amounts to 5,1 %.

         4.   Export Promotion Capital Goods Scheme (‘EPCGS’)

   (a)   Legal basis

               (53)

               The detailed description of the EPCGS is contained in chapter 5 of the EXIM-policy 04-09 and in chapter 5 of the HOP I 04-09.

         (b)   Eligibility

               (54)

               Manufacturer-exporters, merchant-exporters ‘tied to’ supporting manufacturers and service providers are eligible for this scheme.

         (c)   Practical implementation

               (55)

               Under the condition of an export obligation, a company is allowed to import capital goods (new and -since April 2003- second-hand capital goods up to 10 years old) at a reduced rate of duty. To this end, the GOI issues, upon application and payment of a fee, an EPCGS licence. Since April 2000, the scheme provides for a reduced import duty rate of 5 % applicable to all capital goods imported under the scheme. Until 31 March 2000, an effective duty rate of 11 % (including a 10 % surcharge) and, in case of high value imports, a zero duty rate, was applicable. In order to meet the export obligation, the imported capital goods must be used to produce a certain amount of export goods during a certain period.

               (56)

               The EPCGS licence holder can also source the capital goods indigenously. In such case, the indigenous manufacturer of capital goods may avail himself of the benefit for duty free import of components required to manufacture such capital goods. Alternatively, the indigenous manufacturer can claim the benefit of deemed export in respect of supply of capital goods to an EPCGS licence holder.

               (57)

               It was found that the applicant used this scheme during the RIP.

         (d)   Conclusion on EPCG Scheme

               (58)

               The EPCGS provides subsidies within the meaning of Article 3(1)(a)(ii) and Article 3(2) of the basic Regulation. The duty reduction constitutes a financial contribution by the GOI, since this concession decreases the GOI’s duty revenue, which would otherwise be due. In addition, the duty reduction confers a benefit upon the exporter, because the duties saved upon importation improve its liquidity.

               (59)

               Furthermore, the EPCGS is contingent in law upon export performance, since such licences can not be obtained without a commitment to export. Therefore, it is deemed to be specific and countervailable under Article 4(4), first subparagraph, point (a) of the basic Regulation.

               (60)

               This scheme cannot be considered a permissible duty drawback system or substitution drawback system within the meaning of Article 3(1)(a)(ii) of the basic Regulation. Capital goods are not covered by the scope of such permissible systems, as set out in Annex I, item (i), of the basic Regulation, because they are not consumed in the production of the exported products.

         (e)   Calculation of the subsidy amount

               (61)

               The subsidy amount was calculated, in accordance with Article 7(3) of the basic Regulation, on the basis of the unpaid customs duty on imported capital goods spread across a period which reflects the normal depreciation period of such capital goods in the industry concerned. In accordance with the established practice, the amount so calculated, which is attributable to the RIP, has been adjusted by adding interest during this period in order to reflect the full value of the benefit over time. The commercial interest rate during the review investigation period in India was considered appropriate for this purpose. Where justified claims were made, fees necessarily incurred to obtain the subsidy were deducted in accordance with Article 7(1)(a) of the basic Regulation.

               (62)

               The applicant claimed that capital goods imported duty-free under the EPCG scheme used in the unit located in Khanvel were no longer in use and that the benefit relating to such goods should not be included in the numerator. In reply to this, it is noted that the applicant has already received the benefit relating to these capital goods. In addition, as there is no evidence that the applicant no longer possesses such goods or that it will not use them again, the claim has to be rejected.

               (63)

               In accordance with Article 7(2) and 7(3) of the basic Regulation, this subsidy amount has been allocated over the export turnover of the product concerned during the RIP as the appropriate denominator, because the subsidy is contingent upon export performance and it was not granted by reference to the quantities manufactured, produced, exported or transported.

               (64)

               The subsidy rate established in respect of this scheme for the applicant for the RIP amounts to 2,3 %.

         5.   Export Credit Scheme (‘ECS’)

   (a)   Legal basis

               (65)

               The details of the scheme are set out in the Master Circular DBOD No DIR.(Exp).BC 01/04.02.02/2007-08 (Rupee/Foreign Currency Export Credit) and Master Circular DBOD No DIR.(Exp).BC 09/04.02.02/2008-09 (Rupee/Foreign Currency Export Credit) of the Reserve Bank of India (‘RBI’), which is addressed to all commercial banks in India.

         (b)   Eligibility

               (66)

               Manufacturing exporters and merchant exporters are eligible for this scheme.

         (c)   Practical implementation

               (67)

               Under this scheme, the RBI mandatorily sets maximum ceiling interest rates applicable to export credits, both in Indian rupees and in foreign currency, which commercial banks can charge an exporter. The ECS consists of two sub-schemes, the Pre-Shipment Export Credit Scheme (‘packing credit’), which covers credits provided to an exporter for financing the purchase, processing, manufacturing, packing and/or shipping of goods prior to export, and the Post-Shipment Export Credit Scheme, which provides for working capital loans with the purpose of financing export receivables. The RBI also directs the banks to provide a certain amount of their net bank credit towards export finance.

               (68)

               As a result of the RBI Master Circulars exporters can obtain export credits at preferential interest rates as compared with the interest rates for ordinary commercial credits (‘cash credits’), which are solely set under market conditions. The difference in rates might decrease for companies with good credit ratings. In fact, high rating companies might be in a position to obtain export credits and cash credits at the same conditions.

               (69)

               It was found that the applicant used this scheme during the RIP.

         (d)   Conclusion on the ECS

               (70)

               The preferential interest rates of an ECS credit set by the RBI Master Circulars mentioned in recital (65) can decrease the interest costs of an exporter as compared with credit costs purely set by market conditions and confer in this case a benefit in the meaning of Article 3(2) of the basic Regulation on such an exporter. Export financing is not per se more secure than domestic financing. In fact, it is usually perceived as being more risky and the extent of security required for a certain credit, regardless of the finance object, is a purely commercial decision of a given commercial bank. Rate differences with regard to different banks are the result of the methodology of the RBI to set maximum lending rates for each commercial bank individually.

               (71)

               Despite the fact that the preferential credits under the ECS are granted by commercial banks, this benefit is a financial contribution by a government within the meaning of Article 3(1)(a)(iv) of the Regulation. In this context, it should be noted that neither Article 3(1)(a)(iv) of the basic Regulation nor the Agreement on Subsidies and Countervailing Measures require a charge on the public accounts, e.g. reimbursement of the commercial banks by the GOI, to establish a subsidy, but only government direction to carry out functions illustrated in points (i), (ii) or (iii) of Article 3(1)(a) of the basic Regulation. The RBI is a public body and falls therefore under the definition of ‘government’ as set out in Article 2(b) of the basic Regulation. It is 100 % government-owned, pursues public policy objectives, e.g. monetary policy, and its management is appointed by the GOI. The RBI directs private bodies, within the meaning of the second indent of Article 3(1)(a)(iv) of the basic Regulation, since the commercial banks are bound by the conditions it imposes, inter alia, with regard to the maximum ceilings for interest rates on export credits mandated in the RBI Master Circulars and the RBI provisions that commercial banks have to provide a certain amount of their net bank credit towards export finance. This direction obliges commercial banks to carry out functions mentioned in Article 3(1)(a)(i) of the basic Regulation, in this case provide loans in the form of preferential export financing. Such direct transfer of funds in the form of loans under certain conditions would normally be vested in the government, and the practice differs, in no real sense, from practices normally followed by governments, within the meaning of Article 3(1)(a)(iv) of the basic Regulation. This subsidy is deemed to be specific and countervailable since the preferential interest rates are only available in relation to the financing of export transactions and are therefore contingent upon export performance, pursuant to Article 4(4), first subparagraph, point (a) of the basic Regulation.

         (e)   Calculation of the subsidy amount

               (72)

               The subsidy amount has been calculated on the basis of the difference between the interest paid for export credits used during the RIP and the amount that would have been payable for ordinary commercial credits used by the applicant. This subsidy amount (numerator) has been allocated over the total export turnover during the RIP as the appropriate denominator in accordance with Article 7(2) of the basic Regulation, because the subsidy is contingent upon export performance and it was not granted by reference to the quantities manufactured, produced, exported or transported.

               (73)

               The subsidy rate established in respect of this scheme for the applicant for the RIP amounts to 0,2 %.

         6.   Package Scheme of Incentives (PSI)

   (a)   Legal basis

               (74)

               In previous investigations regarding PET film, including the review investigation that led to the imposition by Regulation (EC) No 367/2006 of the definitive countervailing duty currently in force, several Indian State schemes involving incentives granted to local companies were investigated. The State schemes fall under the heading ‘Package Scheme of Incentives’ (PSI), as there can be different kinds of incentives involved. The investigation established that a company’s entitlement to benefits under the scheme is stipulated in the ‘Eligibility Certificate’.

               (75)

               The Package Scheme of Incentives (PSI) of the Government of Maharashtra (GOM) has been amended several times since its introduction. The applicant continues to avail itself of benefits under the PSI ‘1993 Scheme’ and not under successor schemes. Consequently, only the PSI 1993 was assessed in the context of the case at hand.

               (76)

               The Sales Tax Remission Scheme of the Government of West Bengal provides for the remission of Central Sales Tax. The investigation revealed that the applicant enjoyed trade tax (Central Sales Tax) exemption under the PSI of the Government of West Bengal in respect of its purchases. This tax provision excuses home-market sales by a company from payment of sales tax (both local sales tax and central sales tax).

         (b)   Eligibility

               (77)

               In order to be eligible, companies must as a general rule invest in less developed areas of a state either by setting up a new industrial establishment or by making a large scale capital investment in expansion or diversification of an existing industrial establishment. The main criterion to establish the amount of incentives is the classification of the area in which the enterprise is or will be located and the size of the investment.

         (c)   Practical implementation

               (78)

               Under the sales tax exemption schemes, designated units were not required to collect any sales tax on their sales transactions. Similarly, designated units were exempted from the payment of sales tax on their purchases of goods from suppliers eligible for the schemes. Whereas the exemption in relation to sales transaction is not considered to confer any benefit on the designated sales units, the exemption in relation to purchase transactions, however, does confer a benefit on the designated purchasing units.

               (79)

               Exemption of sales tax on purchases within the State of Maharashtra (which was earlier exempted under the Maharashtra Sales Tax Exemption Scheme of Incentives) is no longer available. In April 2005 the sales tax legislation for intra-State sales in Maharashtra was replaced by a value added tax (VAT) system. With effect from April 2005, the applicant, as a non-exempt unit, has to purchase materials by paying VAT.

         (d)   Conclusion

               (80)

               As regards the PSI 1993 of the GOM, the applicant only accrued remission rights of sales tax on sales of finished goods during the RIP, which in the past has been found not to confer a benefit on the recipient (recital 114 of Regulation (EC) No 367/2006). Therefore, no countervailable benefit was found under the PSI 1993 of the GOM.

               (81)

               However, as regards the applicant’s purchases from companies not located in the State of Maharashtra of raw materials without the payment of Central Sales Tax, the PSI provides subsidies within the meaning of Article 3(1)(a)(ii) and Article 3(2) of the basic Regulation. The exemption from payment of sales taxes on purchases constitutes a financial contribution, since this concession decreases the Government’s revenue which would otherwise be due. In addition, this exemption confers a benefit upon the companies as it improves their liquidity.

               (82)

               The PSI is only available to companies having invested within certain designated geographical areas within the jurisdiction of a State in India. It is not available for companies located outside these areas. The level of benefit is different according to the area concerned. The scheme is therefore specific in accordance with Article 4(2), first subparagraph, point (a) and Article 4(3) of the basic Regulation and therefore countervailable.

         (e)   Calculation of the subsidy amount

               (83)

               Concerning the sales tax exemption, the subsidy amount was calculated on the basis of the amount of the sales tax normally due during the RIP but which remained unpaid.

               (84)

               Pursuant to Article 7(2) of the basic Regulation, the amount of subsidy (numerator) has then been allocated over the total turnover of export and domestic sales during the review investigation period as the appropriate denominator, because the subsidy is not export-contingent and it was not granted by reference to the quantities manufactured, produced, exported or transported.

               (85)

               The subsidy rate established in respect of this scheme for the applicant for the RIP amounts to 0,1 %.

         7.   Amount of countervailable subsidies

               (86)

               It is recalled that Regulation (EC) No 1124/2007, amending Council Regulation (EC) No 367/2006, established the amount of countervailable subsidies for the applicant, expressed ad valorem, at 17,1 %.

               (87)

               During the present partial interim review, the amount of countervailable subsidies for the applicant, expressed ad valorem, was found to be 8,4 %, as listed hereunder:

                           SCHEME→

                           AAS (9)

                           DEPBS (9)

                           EPCGS (9)

                           ECS (9)

                           PSI

                           Total

                           COMPANY ↓

                           %

                           %

                           %

                           %

                           %

                           %

                           Jindal Poly Films Limited

                           0,7

                           5,1

                           2,3

                           0,2

                           0,1

                           8,4

               (88)

               Account taken of the above it is concluded that the level of subsidisation with regard to the exporting producer concerned has decreased.

         8.   Countervailing measures

               (89)

               It was also examined whether the changed circumstances with regard to the examined schemes could be considered to be of a lasting nature. In this respect, several elements would suggest that this is the case.

               (90)

               Firstly, it should be noted that the findings in this partial interim review are in line with the subsidy amounts established for five Indian PET film producers in the partial interim review published in January 2009, where the amount of countervailable subsidies, expressed ad valorem, were found to be ranging from 5,4 % to 8,6 %. This is an indication of certain constancy in the level of subsidisation existing in India for this product.

               (91)

               Secondly, while in the previous investigation the main benefit was conferred under the AAS, the benefit under this scheme has dropped significantly during the RIP and evidence has been obtained that this continued to be the case also after the RIP

               (92)

               On the basis of the above there seems to be indications that the applicant will continue to receive subsidies in the future of an amount which is less than the one determined in the previous partial interim review investigation.

               (93)

               Since it has been demonstrated that the applicant is in receipt of much lesser subsidisation than before and that it is likely to continue to receive subsidies of an amount which is less than determined in the previous partial interim review investigation, the level of the measure should therefore be amended to reflect the new findings.

               (94)

               In view of the above, the amended countervailing duty rate should be established at the new rate of subsidisation found during the present partial interim review, as the injury margin calculated in the original anti-subsidy investigation remains higher.

               (95)

               Pursuant to Article 24(1), second subparagraph of the basic Regulation and Article 14(1) of Council Regulation (EC) No 1225/2009 of 30 November 2009 on protection against dumped imports from countries not members of the European Community (10), no product shall be subject to both anti-dumping and countervailing duties for the purpose of dealing with one and the same situation arising from dumping or from export subsidisation. However, as mentioned in recital (6) above, since the applicant is subject to an anti-dumping duty of 0 % with regard to the product concerned, these provisions do not apply in the present case.

               (96)

               With regard to the rate of duty currently applicable to imports of the product concerned from exporting producers not individually mentioned in Article 1(2) of Regulation (EC) No 367/2006, i.e. the duty specified as applying to ‘all other companies’ in India, it is noted that the actual modalities of the investigated schemes and their countervailability have not changed with respect to the previous investigation. Thus there is no reason to re-calculate the subsidy and duty rates of these companies. Consequently, the rates of the duty applicable to all companies other than the applicant remain unchanged,

         HAS ADOPTED THIS REGULATION:
   Article 1
   Article 1(2) of Council Regulation (EC) No 367/2006 shall be replaced by the following:

      ‘2.   The rate of the definitive countervailing duty applicable to the net free-at-Union-frontier price, before duty, of the products manufactured by the companies listed below, shall be as follows:

                  Company

                  Definitive duty (%)

                  TARIC additional code

                  Ester Industries Limited, 75-76, Amrit Nagar, Behind South Extension Part-1, New Delhi 110003, India

                  7,2

                  A026

                  Garware Polyester Limited, Garware House, 50-A, Swami Nityanand Marg, Vile Parle (East), Mumbai 400057, India

                  5,4

                  A028

                  Jindal Poly Films Limited, 56 Hanuman Road, New Delhi 110001, India

                  8,4

                  A030

                  MTZ Polyfilms Limited, New India Centre, 5th Floor, 17 Co-operage Road, Mumbai 400039, India

                  8,7

                  A031

                  Polyplex Corporation Limited, B-37, Sector-1, Noida 201301, Dist. Gautam Budh Nagar, Uttar Pradesh, India

                  8,6

                  A032

                  SRF Limited, Block C, Sector 45, Greenwood City, Gurgaon 122003, Haryana, India

                  5,4

                  A753

                  Uflex Limited, A-1, Sector 60, Noida 201301 (U.P.), India

                  6,4

                  A027

                  All other companies

                  19,1

                  A999’

   Article 2
   This Regulation shall enter into force on the day following its publication in the Official Journal of the European Union.

      This Regulation shall be binding in its entirety and directly applicable in all Member States.
      Done at Luxembourg, 29 June 2010.

            For the Council

            The President

         E. ESPINOSA

      (1)  OJ L 188, 18.7.2009, p. 93.

      (2)  OJ L 316, 10.12.1999, p. 1.

      (3)  OJ L 68, 8.3.2006, p. 15.

      (4)  OJ L 236, 31.8.2006, p. 1.

      (5)  OJ L 255, 29.9.2007, p. 1.

      (6)  OJ L 6, 10.1.2009, p. 1.

      (7)  OJ L 288, 6.11.2007, p. 1.

      (8)  OJ C 215, 9.9.2009, p. 17.

      (9)  Subsidies marked with an asterisk are export subsidies.

      (10)  OJ L 343, 22.12.2009, p. 51.


title: Commission Implementing Regulation (EU) No 711/2012 of 3 August 2012 amending Regulation (EU) No 185/2010 laying down detailed measures for the implementation of the common basic standards on aviation security as regards the methods used for screening persons other than passengers and items carried  Text with EEA relevance

text:
               4.8.2012

               EN

               Official Journal of the European Union

               L 209/1

         COMMISSION IMPLEMENTING REGULATION (EU) No 711/2012
   of 3 August 2012
   amending Regulation (EU) No 185/2010 laying down detailed measures for the implementation of the common basic standards on aviation security as regards the methods used for screening persons other than passengers and items carried
   (Text with EEA relevance)
   THE EUROPEAN COMMISSION,
   Having regard to the Treaty on the Functioning of the European Union,
   Having regard to Regulation (EC) No 300/2008 of the European Parliament and of the Council of 11 March 2008 on common rules in the field of civil aviation security and repealing Regulation (EC) No 2320/2002 (1), and in particular Article 4(3) thereof,
   Whereas:

               (1)

               Commission Regulation (EC) No 272/2009 of 2 April 2009 supplementing the common basic standards on civil aviation security laid down in the Annex to Regulation (EC) No 300/2008 of the European Parliament and of the Council (2) provides that the implementing rules to be adopted pursuant to Article 4(3) of Regulation (EC) No 300/2008 may allow the use of explosive trace detection (ETD) equipment and explosive detection dogs for screening persons other than passengers and items carried.

               (2)

               It is necessary to adopt detailed provisions on the deployment of explosive trace detection (ETD) equipment and explosive detection dogs for screening persons other than passengers and items carried.

               (3)

               The use of explosive trace detection (ETD) equipment and explosive detection dogs for screening persons other than passengers and items carried should take into account the specific context of staff screening and can facilitate and improve the effectiveness of the screening process.

               (4)

               The provisions relating to walk-through metal detection (WTMD) are laid down in Commission Regulation (EU) No 185/2010 of 4 March 2010 laying down detailed measures for the implementation of the common basic standards on aviation security (3) should be revised in line with the evolution of the threat to civil aviation and the risk posed by different categories of persons.

               (5)

               Regulation (EU) No 185/2010 should therefore be amended accordingly.

               (6)

               The measures provided for in this Regulation are in accordance with the opinion of the Committee on Civil Aviation Security,

         HAS ADOPTED THIS REGULATION:
   Article 1
   The Annex to Regulation (EU) No 185/2010 is amended in accordance with the Annex to this Regulation.
   Article 2
   This Regulation shall enter into force on the twentieth day following that of its publication in the Official Journal of the European Union.

      This Regulation shall be binding in its entirety and directly applicable in all Member States.
      Done at Brussels, 3 August 2012.

            For the Commission

            The President

         José Manuel BARROSO

      (1)  OJ L 97, 9.4.2008, p. 72.

      (2)  OJ L 91, 3.4.2009, p. 7.

      (3)  OJ L 55, 5.3.2010, p. 1.

      ANNEX
      The Annex to Regulation (EU) No 185/2010 is amended as follows:

                  1.

                  Point 1.3.1 is replaced by the following:
                  ‘1.3.1   Screening of persons other than passengers and items carried

                              1.3.1.1

                              Persons other than passengers shall be screened by one of the following means:

                                          (a)

                                          hand search;

                                          (b)

                                          walk-through metal detection equipment (WTMD);

                                          (c)

                                          explosive detection dogs;

                                          (d)

                                          explosive trace detection (ETD) equipment;

                                          (e)

                                          security scanners which do not use ionising radiation.

                              1.3.1.2

                              Points 4.1.1.3 — 4.1.1.6 and 4.1.1.10 shall apply to the screening of persons other than passengers.

                              1.3.1.3

                              Explosive detection dogs and ETD equipment may only be used as a supplementary means of screening or in unpredictable alternation with hand searches, WTMD or security scanners.

                              1.3.1.4

                              Items carried by persons other than passengers shall be screened by one of the following means:

                                          (a)

                                          hand search;

                                          (b)

                                          x-ray equipment;

                                          (c)

                                          explosive detection systems (EDS) equipment;

                                          (d)

                                          explosive detection dogs;

                                          (e)

                                          explosive trace detection (ETD) equipment.

                              1.3.1.5

                              Points 4.1.2.4 — 4.1.2.7 shall apply to the screening of items carried by persons other than passengers.

                              1.3.1.6

                              Explosive detection dogs and ETD equipment may only be used as a supplementary means of screening or in unpredictable alternation with hand searches, x-ray equipment or EDS equipment.

                              1.3.1.7

                              Articles listed in Attachment 4-C may be carried only if the person is authorised to do so in order to undertake tasks that are essential for the operation of airport facilities or of aircraft, or for performing in-flight duties.

                              1.3.1.8

                              Where persons other than passengers and items carried have to be screened on a continuous random basis, the frequency shall be established by the appropriate authority on the basis of a risk assessment.

                              1.3.1.9

                              The screening of persons other than passengers and items carried shall also be subject to the additional provisions laid down in a separate Commission Decision.’

                  2.

                  Point 12.1.2 is replaced by the following:
                  ‘12.1.2   Standards for WTMD

                              12.1.2.1

                              There shall be two standards for WTMD. Detailed requirements on these standards are laid down in a separate Commission Decision.

                              12.1.2.2

                              All WTMD exclusively used for screening persons other than passengers shall meet standard 1.

                              12.1.2.3

                              All WTMD used for screening of passengers shall meet standard 2.’


title: Council Implementing Regulation (EU) No 792/2011 of 5 August 2011 imposing a definitive anti-dumping duty and collecting definitively the provisional duty imposed on imports of certain ring binder mechanisms originating in Thailand

text:
               9.8.2011

               EN

               Official Journal of the European Union

               L 204/11

         COUNCIL IMPLEMENTING REGULATION (EU) No 792/2011
   of 5 August 2011
   imposing a definitive anti-dumping duty and collecting definitively the provisional duty imposed on imports of certain ring binder mechanisms originating in Thailand
   THE COUNCIL OF THE EUROPEAN UNION,
   Having regard to the Treaty on the Functioning of the European Union,
   Having regard to Council Regulation (EC) No 1225/2009 of 30 November 2009 on protection against dumped imports from countries not members of the European Community (1), (the basic Regulation) and in particular Article 9(4) thereof,
   Having regard to the proposal submitted by the European Commission (the Commission) after having consulted the Advisory Committee,
   Whereas:
   1.   PROVISIONAL MEASURES

               (1)

               The Commission, by Regulation (EU) No 118/2011 of 10 February 2011 (2) (the provisional Regulation) imposed a provisional anti-dumping duty on imports of certain ring binder mechanisms originating in Thailand.

               (2)

               The proceeding was initiated as a result of a complaint lodged on 6 April 2010 by Ring Alliance Ringbuchtechnik GmbH (the complainant) on behalf of producers representing a major proportion, in this case more than 50 % of the total Union production of certain ring binder mechanisms (RBM). The complaint contained prima facie evidence of dumping of the said product and of material injury resulting there from, which was considered sufficient to justify the initiation of a proceeding.

               (3)

               It is recalled that, as set out in recital 7 of the provisional Regulation, the investigation of dumping and injury covered the period from 1 April 2009 to 31 March 2010 (‘the investigation period’ or ‘IP’). The examination of trends relevant for the assessment of injury covered the period from 1 January 2006 to the end of the investigation period (injury investigation period).

         2.   SUBSEQUENT PROCEDURE

               (4)

               Subsequent to the disclosure of the essential facts and considerations on the basis of which it was decided to impose provisional anti-dumping measures (provisional disclosure), several interested parties made written submissions making known their views on the provisional findings. The parties who so requested, in particular two importers and the Thai producer, were granted the opportunity to be heard.

               (5)

               The Commission continued to seek and verify all information it deemed necessary for its definitive findings with respect to dumping, injury, causality and Union interest. In addition to the verifications mentioned in recital 6 of the provisional Regulation, a further verification was carried out at the premises of Rima Benelux Holding BV, the only user that had cooperated in the investigation by replying to a user’s questionnaire.

               (6)

               All parties were informed of the essential facts and considerations on the basis of which it was intended to recommend the imposition of a definitive anti-dumping duty on imports of certain ring binder mechanisms originating in Thailand and the definitive collection of the amounts secured by way of the provisional duty. They were also granted a period of time within which they could make representations subsequent to this disclosure.

               (7)

               The oral and written comments submitted by the interested parties were considered and taken into account where appropriate.

         3.   PRODUCT CONCERNED AND LIKE PRODUCT

               (8)

               In the absence of any comments concerning the product concerned and the like product, recitals 8 to 11 of the provisional Regulation are hereby confirmed.

         4.   DUMPING

   4.1.   Normal Value

               (9)

               It is recalled that, as explained in recital 14 of the provisional Regulation, only one Thai exporting producer cooperated in the investigation and that its exports to the Union during the IP accounted for all Thai exports to the Union. The exporting producer and one cooperating unrelated importer claimed that the independent external expert who assisted the Commission during the on-spot visit to the exporting producer made some calculation errors in his report. One of the tasks of the expert was to examine the nickel coating process and the amount of raw materials consumed by the exporting producer in the different production phases. As mentioned in recital 15 of the provisional Regulation, the investigation revealed that the exporting producer provided incomplete and incorrect information with regard to significant elements of its cost of production and other raw materials. The allegations made by the exporting producer and an importer regarding calculation errors in the expert’s report were examined by the Commission and it was concluded that they were not founded. Therefore, the findings as set out in recital 15 of the provisional Regulation are confirmed.

               (10)

               The exporting producer and an importer also contested the provisional findings as set out in recitals 19 to 20 of the provisional Regulation. In particular, they claimed that the methodology used for the provisional determination of the normal value for types other than those for which a specific normal value was established was over-stated, because it had been incorrectly based on an arithmetic average of the normal values. The Commission accepted the claim, adjusted the methodology and revised the calculation of the normal values for these other types taking account of the product mix of the Thai producer, which more accurately reflects his situation.

               (11)

               The exporting producer further argued that the rates used for selling, general and administrative expenses (SGA) and profit margins of respectively 16 % and 8 % were too high. The exporting producer argued that the SGA rate should not exceed 12,59 %, reflecting its own SGA excluding inland freight costs.

               (12)

               It is recalled that as outlined in recitals 15 to 17 of the provisional Regulation the exporting producer did not cooperate with the investigation and consequently did not provide data about its full SGA costs. Under these circumstances and given the fact that no further information was provided on the company’s full SGA costs, it was decided to continue to rely on the information available in the complaint. Furthermore, in the light of the information available and insofar as it could be verified, a SGA rate of 16 % was considered to be reasonable. Therefore, the claim was rejected.

               (13)

               The exporting producer claimed that the profit level of 8 % used in the provisional calculation was too high and instead, a profit level of 5 % should have been used. The arguments put forward were, firstly, a profit level of 5 % has been used for the target profit in the injury analysis and, secondly, a profit level of 5 % would be in line with previous investigations on the same product. On the first argument, the Commission noted that the determination of a target profit for the Union industry and the profit level used for the determination of a normal value do not follow the same logic and therefore, do not have to be the same. On the second argument, the Commission agreed that there were some grounds for using the same profit level as in previous investigations on the same product and decided to accept this claim and to change the profit level used in the calculation of the normal values accordingly.

               (14)

               Further to final disclosure, the Union industry and the exporting producer submitted some comments. The Union industry disagreed with the correction made regarding the profit margin arguing that a profit rate of 5 % would not be sufficient to cover the profitability requirements of the three related companies involved in the production and sales of the product concerned, but without providing any other substantial arguments. Therefore, the claim was rejected.

               (15)

               The exporting producer claimed that the cost for depreciation, building and insurance used in the calculation of the normal value of one type was not the same as the one used for the other types and the same figure should apply to all types. The Commission verified the claim and indeed found an error in the calculation. However, contrary to the exporting producer’s claim the error was found to be made in the calculation of the normal value of the other types. A correction to the normal value for the other types was made accordingly.

               (16)

               The exporting producer also claimed that the normal values for types other than those for which a specific normal value was established did not take fully into account the actual product mix of the exporting producer. In this respect, the exporting producer reiterated his claim that a weighted average of the normal values found should be used for the other types, thus reflecting the actual product mix of the exporting producer. As mentioned in recital 10 above, the Commission agreed to revise the calculation of the normal values for these other types in order to take into account of the actual product mix of the Thai producer and, irrespective of the actual sales volumes for each type, a normal value for small, medium and large RBM was calculated. However, the Commission rejected the argument that in addition a weighting factor based on the exporter’s sales to the Union should be taken into consideration in the absence of substantiated reasons.

               (17)

               In addition, the exporting producer claimed that the Commission’s method of calculating NV on the basis of the length of the ring binder mechanisms was imprecise and incomplete and proposed a new method for the calculation of the averages which would take into account their various lengths more accurately. As explained in recital 16 above the Commission calculated a normal value for types other than those for which a specific normal value was established and calculated normal values reflecting small, medium and large RBM. The exporter’s calculation was found to be flawed and result-oriented. Therefore, the claim was rejected.

               (18)

               Apart from the changes mentioned above and in the absence of any other comments, the content of recitals 15 to 20 of the provisional Regulation concerning the establishing of the normal value is hereby definitively confirmed.

         4.2.   Export price and comparison

               (19)

               The exporting producer claimed that the currency used for the computation of transport costs in the dumping calculation was not the correct one. The Commission accepted this claim.

               (20)

               In the absence of any other comments, the content of recitals 21 to 24 of the provisional Regulation concerning the establishing of export prices and comparing the export prices with the respective normal value is hereby definitively confirmed.

         4.3.   Dumping margin

               (21)

               The exporting producer claimed that the calculation of the dumping margin did not take into account the specific normal value for two types. The claim was accepted and corrected accordingly.

               (22)

               In the light of the above-mentioned changes in the calculation of the normal value and the comparison, and after correction of the calculation error regarding export price mentioned above, the amount of dumping finally determined, expressed as a percentage of the CIF Union frontier price, duty unpaid, is as follows:

                           Exporting producer

                           Dumping margin

                           Thai Stationery Industry Co. Ltd, Bangkok, Thailand

                           16,3 %

               (23)

               Since the cooperating exporting producer accounted for all Thai exports to the Union of the product concerned, it was considered that the residual dumping margin should be set at the level of dumping margin found for this cooperating exporting producer, i.e. 16,3 %.

         5.   DEFINITION OF THE UNION INDUSTRY

               (24)

               In the absence of any comments concerning the definition of the Union industry, the findings set out in recitals 28 to 32 of the provisional Regulation are hereby confirmed.

         6.   INJURY

   6.1.   Union consumption and imports from Thailand

               (25)

               The Thai producer and several importers questioned the trends in Union consumption established in the provisional Regulation. In particular, they argued that the consumption decreased to a higher extent than what was provisionally established (by around 30 %). They also asked for clarifications concerning the methodology followed by the Commission to establish consumption, because the RBM is included in a customs tariff heading including other products.

               (26)

               It should be mentioned that although these interested parties contested the findings related to the consumption, no supporting evidence or figures have been provided to substantiate their arguments. They also did not point to any methodological flaw.

               (27)

               As to the methodology, it should be recalled that, as mentioned in recital 33 of the provisional Regulation, the consumption was established on the basis of the verified sales figures provided in the questionnaire’s reply of the cooperating parties (the two Union producers and the Thai exporter for the periods 2008-IP) and on the basis of Eurostat figures for the rest of the imports. Given that RBM from other sources are subject to anti-dumping measures, imports (from all sources) are registered under sub-headings codes in the customs tariff database (TARIC) which are very largely specific to the product under investigation. These sub-headings were used in order to ensure that only imports of the product concerned were considered, despite a minor update of the product definition in this investigation.

               (28)

               Furthermore, given that Eurostat figures are expressed in kilograms, while the consumption has been calculated in pieces, one importer requested clarifications as to the methodology used to covert kilograms into pieces. It should thus be clarified that a conversion factor of 50 gram/piece has been used, which is in line with previous investigations and was found to be reasonable, when compared to the information provided by the Thai exporting producer. It should be also added that, if the Commission had used exactly the average weight per piece resulting from the information provided by the Thai exporting producer, the imports from Thailand would have shown during the overall injury investigation period a steeper increase in terms of both absolute volume (by 25 %, as compared to 19 % established in the provisional Regulation) and market shares (from 11,8 % to 15,5 %, as compared to 12,0 % to 15,0 % established in the provisional Regulation).

               (29)

               One importer also claimed that the Thai imports actually decreased by 40 % during the injury investigation period, but this was based on the import value — and not on the volume — for the totality of the customs code, thus including products other than those under investigation. This claim had to be rejected.

               (30)

               In view of the above, the findings in recitals 33 to 40 of the provisional Regulation concerning the Union consumption (which decreased by more than 15 % between 2008 and the IP) and the imports from Thailand, are hereby confirmed.

         6.2.   Economic situation of the Union industry

               (31)

               One importer submitted that the injury analysis was biased because the poor financial situation of the Union industry should be seen in conjunction with the situation of one of its related companies, which is allegedly making profits in the RBM’s business. In this respect it is noted that the injury analysis should only focus on the Union industry’ sales on the Union market of the product concerned produced in the Union. Since, as mentioned in recital 69 of the provisional Regulation, the related company in question is not a producer in the Union and is mostly trading products not originating in the Union, it should not be taken into consideration for the purpose of the injury analysis.

               (32)

               Without prejudice to the above, it is nevertheless underlined that the importer has provided no information showing that the above-mentioned related company would be in a good financial situation. To the contrary, the figures obtained during the investigation show that also this company decreased significantly its sales volume of RBM during the investigation period.

               (33)

               Account taken of the above and in the absence of other comments in respect to the injury analysis, the recitals 41 to 57 of the provisional Regulation are hereby confirmed, and it is concluded that the Union industry has suffered material injury within the meaning of Article 3(5) of the basic Regulation.

         7.   CAUSATION

   7.1.   Effects of the dumped imports

               (34)

               Even though some interested parties contested the provisional findings regarding the effect of other factors (see below), none of them contested the provisional conclusion that dumped imports from Thailand caused injury to the Union industry. The recitals 58 to 64 of the provisional Regulation are thus hereby confirmed.

         7.2.   Effects of other factors

               (35)

               Some interested parties contested the provisional findings concerning the effect of other factors, and submitted that alternately contraction in demand, competition between Union producers, imports from India and self-inflicted injury would be the main cause of injury.

               (36)

               Concerning the contraction in demand, reference is made to recitals 25 to 30 above which confirm the trend of the consumption established in the provisional Regulation. The allegations that the effects of the contraction in demand have been underestimated should therefore be rejected. Nevertheless, it should be recalled that the recital 67 of the provisional Regulation concluded that the decrease in consumption indeed might have contributed to the material injury suffered by the Union industry, although this effect was considerably reinforced by the effect caused by the dumped imports. However, the effect of the decrease in consumption was not such as to break the causal link between the dumped imports and the injury found.

               (37)

               It was also argued by the Thai exporter that the injury suffered by the Union industry was also caused by the competition between the Union producers. This is mainly because the loss of the Union industry’s market share coincided with the market share increase of the other Union producer.

               (38)

               In this respect, even if the calculations presented by the Thai exporter are not entirely correct, it is true that overall the market share of the second producer also increased during the injury investigation period. It should however be recalled that, as mentioned in the recital 30 of the provisional Regulation, this producer is importing a significant quantity of RBM from Thailand. Interestingly, the year when this producer managed to increase its sales of Union made products and market shares it also significantly increased its sales of RBM from Thailand. Actually, it even became a significant importer of Thai RBM, by purchasing a major part of the Thai exports during that year. Therefore, even if indeed the second Union producer managed to take over some market shares from the Union industry, it is difficult not to conclude that this company managed to do this because it also benefited from the dumped imports of RBM from Thailand. It is recalled that this producer was excluded from the definition of the Union industry because of his important import activities as compared to his own production.

               (39)

               Furthermore, the claim already addressed in recital 69 of the provisional Regulation that Indian imports also caused injury to the Union industry was reiterated by interested parties. This was based on the fact that India holds around 50 % share of the Union market, i.e. three times more than Thailand, and that the corresponding average prices decreased by 3 % between 2009 and IP, while undercutting Union prices by 24 %. It was also underlined that a significant portion of the Indian imports was purchased by a company related to the Union industry.

               (40)

               No new arguments were however given in this respect and these claims were already addressed in the provisional Regulation. Even if the absolute level of Indian imports was indeed overall higher than that of Thailand, it was shown in the provisional Regulation that these imports developed differently: while Thai imports increased overall during the injury investigation period, both in absolute and relative terms, Indian imports decreased (by almost 10 %) and market shares also slightly diminished. In addition, the Indian average price level was also higher than the Thai import price. Furthermore, even if a company related to the Union industry is importing RBM from India, the investigation established that the level of these imports has significantly decreased over the years as mentioned above in recital 32.

               (41)

               Finally, several interested parties also claimed that the complainant lost its customers because it became active on the downstream market via its mother company, Ring International Holding (RIH), and that sales of RBM to related companies should be considered carefully because they would not be made at arm’s length. These claims have however been rejected because they were not substantiated and the investigation showed that sales to related companies were negligible as compared to total sales.

         7.3.   Conclusion on causation

               (42)

               Based on the above, the provisional conclusions laid down in recitals 65 to 76 of the provisional Regulation are hereby confirmed. Even if factors other than imports also had some impact on the situation of the Union industry, it is concluded that dumped imports from Thailand have caused material injury to the Union industry, within the meaning of Article 3(6) of the basic Regulation, based on an analysis which has properly distinguished and separated the effects of all known factors from the injurious effects of the dumped imports.

         8.   UNION INTEREST

               (43)

               Two of the five importers that cooperated during the investigation reacted to the disclosure of the provisional findings and submitted comments in writing. One of these importers requested to be heard as well as another importer. The Commission also decided to carry out a visit at the premises of the sole user that participated to the investigation.

               (44)

               No comments were made with respect to the recitals 79 to 90 of the provisional Regulation concerning the description of the market and the section related to the interest of the Union industry.

         8.1.   Importers and traders

               (45)

               It is firstly recalled that in the provisional Regulation it was concluded that the imposition of measures could only have a significant negative impact on the situation of one importer, which also produces RBM in the Union. This importer did not react to the imposition of the provisional measures.

               (46)

               One other importer, which also requested a hearing chaired by the Hearing Officer, mainly questioned the calculation of the dumping margin, the injury analysis and the calculation of the Union consumption. It did however not raise any new comment regarding the Union interest analysis.

               (47)

               A third importer, representing 20 % of the overall Thai imports, requested a hearing during which it was explained that, contrary to the information submitted previously during the investigation, it did not cease all its activities related to RBM — as mentioned in recital 92 of the provisional Regulation — but has transferred them to another office. During the hearing, this importer explained that its RBM-business is only complementary to its core one covering other products and did not exclude importing RBM from Thailand even if measures are imposed. However, because of the overhead costs of its large distribution network, this will depend on the level of the anti-dumping duties and on the possibility to increase the price to customers. Alternatively, this importer would not suffer significant negative consequences from stopping the RBM-business given the minor importance of this activity as compared to its overall business.

         8.2.   Users

               (48)

               As mentioned in recital 5 above, the questionnaire reply of the only cooperating user was verified during the visit at its premises after the imposition of the provisional measures. This user is purchasing from a variety of sources, including the Union, India and Thailand. It also used to import from China but changed its source of supply since the imposition of anti-dumping duties.

               (49)

               Thai imports represent around 10 % of its total purchases of RBM, and the company decided not to import Thai products since the imposition of the provisional measures. Even if so far the measures did not seem to have significantly affected its economic situation, this company nevertheless deplored the limitation of its sources of supply, and especially the fact that now it cannot rely always on short-term delivery of RBM.

               (50)

               Interested parties reiterated their claim, already addressed in the provisional Regulation, that the imposition of measures would lead to limited sources of supply on the Union market. It is thus worth restating that indeed the investigation showed that the Union market is characterised by a limited number of players: there is one producer in India, one in Thailand, two in the Union and some in China. The purpose of anti-dumping measures is to restore fair competition on the Union market and not to prevent imports. This may indeed result in a reduction of the level of imports, while measures offset the trade distorting nature of these imports. This is however, as such, not a sufficient reason to question the imposition of measures against dumped imports. It could even be argued that fair competition should be guaranteed on the Union market to ensure the continued existence of all sources of supply in the long term.

               (51)

               It is expected that with a level of the definitive duty, which is lower than the provisional one, Thai imports could still enter the Union market, while the investigation has shown that there are also other sources of supply, even if in limited number.

         8.3.   Conclusion on the Union interest

               (52)

               In the light of the above, and in the absence of any other comments, recitals 77 to 110 of the provisional Regulation are hereby confirmed and it is concluded that overall, based on the information available concerning the Union interest, there are no compelling reasons against the imposition of definitive measures against imports of RBM originating in Thailand.

         9.   DEFINITIVE ANTI-DUMPING MEASURES

   9.1.   Injury elimination level

               (53)

               In the absence of any comments as to the injury elimination level, recitals 111 to 114 of the provisional Regulation are hereby confirmed.

         9.2.   Definitive measures

               (54)

               With respect to the amount of duty necessary to remove the effects of the injurious dumping, it has been commented that the anti-dumping duty should be reduced to 6 %, since allegedly Indian imports are not dumped and are 6 % higher than Thai imports. In this respect, it is noted that the purpose of anti-dumping duties is not to align prices to those of other sources but to eliminate the distorting effects of injurious dumping.

               (55)

               In view of the conclusions reached with regard to dumping, injury, causation and Union interest, and in accordance with Article 9(4) of the basic Regulation, a definitive anti-dumping duty should be imposed at the level of the lowest of the dumping and injury margins found, in accordance with the lesser duty rule. In this case, the duty rate should accordingly be set at the level of the dumping found. This was calculated at 16,3 % having fallen significantly since the provisional stage.

               (56)

               On the basis of the above, the rate of the definitive anti-dumping duty for the cooperating exporter is 16,3 %.

         10.   DEFINITIVE COLLECTION OF THE PROVISIONAL DUTY

               (57)

               In view of the magnitude of the dumping margin found and given the level of the injury caused to the Union industry, it is considered necessary that the amounts secured by way of provisional anti-dumping duty imposed by the provisional Regulation should be definitively collected to the extent of the amount of the duty definitively imposed by this Regulation. Since the definitive duty is lower than the provisional duty, the amounts secured in excess of the definitive duty rate should be released,

         HAS ADOPTED THIS REGULATION:
   Article 1
   1.   A definitive anti-dumping duty is hereby imposed on certain ring binder mechanisms, currently falling within CN code ex 8305 10 00 (TARIC codes 8305100011, 8305100013, 8305100019, 8305100021, 8305100023, 8305100029, 8305100034, 8305100035 and 8305100036) originating in Thailand. For the purpose of this Regulation, ring binder mechanisms shall consist of at least two steel sheets or wires with at least four half-rings made of steel wire fixed on them and which are kept together by a steel cover. They can be opened either by pulling the half rings or with a small steel trigger mechanism fixed to the ring binder mechanism.
   2.   The rate of the definitive anti-dumping duty applicable to the net, free-at-Union-frontier price, before duty, of the products described in paragraph 1 shall be 16,3 %.
   3.   Unless otherwise specified, the provisions in force concerning customs duties shall apply.
   Article 2
   Amounts secured by way of the provisional anti-dumping duty pursuant to Regulation (EU) No 118/2011 shall be definitively collected at the rate of the definitive duty imposed pursuant to Article 1 of this Regulation. The amounts secured in excess of the rate of the definitive anti-dumping duty shall be released.
   Article 3
   This Regulation shall enter into force on the day following its publication in the Official Journal of the European Union.

      This Regulation shall be binding in its entirety and directly applicable in all Member States.
      Done at Brussels, 5 August 2011.

            For the Council

            The President

         M. DOWGIELEWICZ

      (1)  OJ L 343, 22.12.2009, p. 51.

      (2)  OJ L 37, 11.2.2011, p. 2.