Council Regulation (EC) No 1279/2007 of 30 October 2007 imposing a definitive anti-dumping duty on certain iron or steel ropes and cables originating in the Russian Federation, and repealing the anti-dumping measures on imports of certain iron or steel ropes and cables originating in Thailand and Turkey

• (168) One of the producers included in the definition of the Community industry was found to purchase raw materials, including wire rods, from related parties (vertically integrated steel groups). It was therefore examined whether the prices from the related suppliers to the Community producers were in line with those charged by the related supplier to independent customers. It was found that the prices charged to the Community producers were in line with prices to independent customers and that this increase also reflected the general increase of prices of steel during the period considered. It was therefore concluded that the average costs of raw materials purchased by Community producers which were vertically integrated should also be included in the calculations.

Employment and Wages — information collected from the sample

Table 10

• (169) Given the increased production and sales volume noted above, the Community industry increased the number of employees by 6 % during the period considered.

• (170) Wages per employee have also increased during the period considered, in line with the general increase in salaries during this period. However, it was found that the average cost of wages per tonne produced could be decreased slightly during the period considered.

Productivity — information collected from the sample

Table 11

• (171) The level of productivity observed for the Community industry has increased considerably during the period considered. This shows that the industry is able to adapt itself to the situation in the Community market.

Magnitude of the actual margin of dumping and recovery from the effects of past dumping

• (172) As concerns the impact on the Community industry of the magnitude of the actual margin of dumping, given the volume and the prices of the imports from the countries concerned, this impact cannot be considered to be negligible.

Profitability, return on investment and cash flow — information collected from the sample

Table 12

• (173) Given the positive development of profitability during the period considered the cash flow and return on assets also showed positive trends during that period. From a slight loss in 2003, the Community industry has been able to slowly but steadily increase its profits, both in relation to sales and in relation to its assets. This performance is likely due to the strong improvement in productivity.

• (174) Nonetheless, it is recalled that this situation may rapidly change because of the high price levels of steel prevailing on the market, but especially if the anti-dumping measures were allowed to lapse and large volumes of dumped imports would be allowed to enter the market.

Table 13

Investments and ability to raise capital — information collected from the sample

• (175) The level of investments observed at the level of the sampled companies has increased by 21 % during the period considered and should be seen in light of increased production capacity.

• (176) None of the Community producers have reported any specific problems in relation to their ability to raise capital.

Conclusion on the economic situation of the Community Industry

• (177) The investigation showed that since the imposition of anti-dumping measures on SWR the Community industry managed to improve its economic situation. Most injury factors such as sales volume, production and production capacity, productivity could be increased. This performance was reached in a booming market as consumption increased by 26 % during the period considered.

• (178) However, the fact that the Community industry lost market share indicates that it could not take full benefit of this positive situation on the Community market.

• (179) The investigation also showed that the Community industry has been able to improve its overall financial situation. The 13 % increase in sales prices during the ERIP allowed the industry to become profitable despite significant increase in raw material prices. As a consequence, return on assets and cash flow also improved during the period considered. It is therefore concluded that, although the situation of the Community industry has improved as compared to the period preceding the imposition of measures, it is still fragile.

Export activities of the Community industry — information collected from the sample

Table 14

• (180) The export performance by the sampled Community industry has improved considerably during the period considered. The export sales have increased by 57 % during the period considered. Also in proportion to its overall sales, the export sales have increase from 15 % to 22 %.

• (181) The average price per tonne for export sales is also considerably higher than the average price for sales on the Community market (see recital 167). The higher prices for exported SWR are due to them being more sophisticated products, triggering higher costs for raw materials and higher manufacturing costs. Notwithstanding the higher cost of production, the Community industry's export performance contributed significantly to the overall profitability for the Community industry.

Conclusion on the likelihood of continuation or recurrence of injury

• (182) The investigation showed that Russian available spare capacities are significant and that there are no apparent reasons that would hamper the activation of such capacities if measures expire. In addition, Russian producers are likely to redirect a substantial amount of their current sales away from third markets and into the Community, given the higher prevailing prices there. Together, these quantities would be substantial — a process facilitated by the existence of well established distribution channels in the Community for Russian exports.

• (183) Furthermore, the significant levels of dumping and undercutting observed, the fact that undertakings appear to act as a price floor, as well as the low level of prices practised in Russian exports to other third countries, indicate that the substantially higher export volumes to the Community mentioned supra would be made at dumped prices which would lie significantly below the prices and costs of the Community industry.

• (184) The combined effect of such volumes and prices would be likely to lead to a significant deterioration of the Community industry's situation, whose situation is still fragile. Whether the Community industry's response thereto was a drop in sales (and hence in production), a reduction in prices, or both, the financial deterioration would be substantial, returning to the difficulties observed prior to the imposition of the original measures.

• (185) On this basis, it is concluded that there is a clear likelihood of recurrence of injurious dumping should anti-dumping measures on imports of SWR originating in Russia be allowed to lapse.

COMMUNITY INTERESTPreliminary remarks

• (186) In accordance with Article 21 of the basic Regulation, it was examined whether the maintenance of the existing anti-dumping measures would be against the interest of the Community as a whole. The determination of the Community interest was based on an appreciation of all the various interests involved. The present investigation analyses a situation in which anti-dumping measures have already been in place and allows for assessment of any undue negative impact on the parties concerned due to the current anti-dumping measures.

• (187) On this basis, it was examined whether, despite the conclusions on the likelihood of a continuation or recurrence of injurious dumping, compelling reasons existed which would lead to the conclusion that it is not in the Community interest to maintain measures in this particular case.

Interest of the Community industry

• (188) As outlined above, there is a clear likelihood of recurrence of injurious dumping if measures applicable to Russian exporters were to be repealed.

• (189) It is recalled that no less than 22 producers in the Community, representing approximately 87 % of the overall production of SWR in the Community, cooperated with the Commission in the investigation and expressed their support for the ongoing measures.

• (190) The continuation of anti-dumping measures on imports from countries concerned would enhance the possibility for the Community industry to maintain and even strengthen its current situation. There is a clear likelihood of recurrence of injurious dumping in substantial volumes which the Community industry is not likely to sustain. The Community industry would therefore continue to benefit from the maintenance of the current anti-dumping measures, in particular as there are also measures against imports of steel ropes and cables originating in the PRC, India, South Africa and Ukraine.

Interest of importers

• (191) In the provisional Regulation (recital 202), it was explained that the distribution of SWR in the Community was characterised by the existence of a significant number of importers/traders. However, although the application for the present expiry review contained a list of 32 importers/traders, all of whom were contacted, only three importers cooperated in the investigation, of whom one importer was found to import the product concerned.

• (192) The core activity of this importer was indeed focused on SWR (between 55 % and 85 %), and it was found that its financial performance had not been seriously affected by the measures in force.

Interest of suppliers

• (193) As explained in more detail in recitals 197 and 198 in the provisional Regulation, the principal raw material used in the production of SWR is industrial steel wire which is manufactured from steel wire rod.

• (194) Some of the Community producers of SWR were found to be vertically integrated, i.e. they had related suppliers of industrial steel wire. Whereas two related suppliers responded to questions concerning prices of raw materials (see recital 168) above, no unrelated suppliers of raw materials made themselves known.

• (195) Whether being a related or unrelated supplier of raw materials to the Community industry, it is clear that those Community suppliers would suffer significantly if measures were allowed to lapse and, as a consequence, the Community industry's sales volumes would decrease. It could therefore clearly be concluded that the maintenance of anti-dumping measures would be in the interest of Community suppliers of raw materials.

Interest of users

• (196) The Commission directly contacted 21 users of SWR in the Community but not a single user made itself known or cooperated in the investigation.

• (197) On that basis it was considered that the users had no compelling reasons against the maintenance of anti-dumping measures.

Conclusion on Community Interest

• (198) Taking into account all of the above factors, it is concluded that there are no compelling reasons against the maintenance of the current anti-dumping measures.

UNDERTAKINGS

• (199) As stated in recital 2 above the Commission accepted SSM's undertaking offer by Decision 2001/602/EC on 26 July 2001. The interim review revealed that since the acceptance of the undertaking in 2001 the product range of SSM had changed significantly.

• (200) The undertaking classified the SWR produced by them in a considerable number of product types with significant price variations within each type. The review investigation confirmed that the company had serious problems in classifying the different product types properly and in accordance with the terms of the undertaking. This was partly due to accounting system limitations which did not allow them to properly distinguish between different SWR product types. Similar problems were already identified during the monitoring of the undertaking and led to a warning letter.

• (201) It has therefore been concluded that the undertaking in its current form is no longer workable and has to be withdrawn by Commission Decision.

• (202) Both Russian exporters offered an undertaking within the deadline following definitive disclosure, but neither offered an acceptable undertaking within the time limit set out in Article 8(2) of the basic Regulation i.e. an undertaking that would reflect the findings of the reviews and that would group different products in categories which would be workable and have limited price variances.

• (203) Given that the issues relating to the withdrawal of the undertaking have been disclosed at a late stage of the proceeding, both Russian exporters should exceptionally be allowed to complete their undertaking offer beyond the normal deadlines, but within 10 calendar days from entry into force of this Regulation. If necessary, the Commission is allowed to propose an amendment to this Regulation accordingly.

FINAL PROVISIONS

• (204) All parties were informed of the essential facts and considerations on the basis of which it was intended to recommend that the existing measures on imports from Russia be maintained and that the level of the measures would be amended where warranted. They were also granted a period to submit comments and claims subsequent to disclosure. No comments were received which were of a nature to change the above conclusions.

• (205) It follows from the above that, as provided for by Article 11(2) of the basic Regulation, the anti-dumping measures applicable to imports of SWR originating in the countries concerned should be maintained for Russia and repealed for Turkey and Thailand.

DUTIES

• (206) In view of the conclusions reached with regard to continuation of dumping, likelihood of recurrence of injury and Community interest, the anti-dumping measures on imports of SWR originating in Russia should be confirmed in order to prevent a recurrence of injury being caused to the Community industry by the dumped imports.

• (207) With regards to the findings of the interim reviews concerning the two Russian companies, it is considered appropriate to amend the anti-dumping duty applicable to BMK to 36,2 % and to SSM to 9,7 %.

• (208) However, in light of the findings as regards Turkey, and the absence of any indications of risk for recurrence of dumping in the future, anti-dumping measures against imports of SWR originating in this country should be repealed.

• (209) Furthermore, in light of the findings as regards Thailand, i.e. the absence of dumping during the Thailand-interim review period and the absence of any indications of risk for recurrence of dumping in the future, anti-dumping measures against imports of SWR originating in this country should equally be repealed,

HAS ADOPTED THIS REGULATION:

Article 1

Article 2

The anti-dumping proceedings concerning imports of iron or steel ropes and cables including locked coil ropes, excluding ropes and cables of stainless steel, with a maximum cross-sectional dimension exceeding 3 mm, with fittings attached or not, falling within CN codes ex731210 81, ex731210 83, ex731210 85, ex731210 89 and ex731210 98 originating in Thailand and Turkey are hereby terminated and anti-dumping measures imposed on those countries by Regulation (EC) No 1601/2001 are repealed.

Article 3

This Regulation shall enter into force on the 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.

[^E0001]: OJ L 56, 6.3.1996, p. 1. Regulation as last amended by Regulation (EC) No 2117/2005 (OJ L 340, 23.12.2005, p. 17).

[^E0002]: OJ L 34, 3.2.2001, p. 4. Regulation as last amended by Regulation (EC) No 1274/2003 (OJ L 180, 18.7.2003, p. 34).

[^E0003]: OJ L 211, 4.8.2001, p. 1. Regulation as last amended by Regulation (EC) No 564/2005 (OJ L 97, 15.4.2005, p. 1).

[^E0004]: OJ L 211, 4.8.2001, p. 47.

[^E0005]: OJ L 299, 16.11.2005, p. 1. Regulation as amended by Regulation (EC) No 121/2006 (OJ L 22, 26.1.2006, p. 1).

[^E0006]: OJ C 51, 1.3.2006, p. 2.

[^E0007]: OJ C 202, 10.8.2004, p. 12.

[^E0008]: OJ C 270, 29.10.2005, p. 38.

[^E0009]: OJ C 181, 3.8.2006, p. 15.

[^E0010]: OJ C 66, 22.3.2007, p. 14.