Commission Implementing Regulation (EU) 2021/1432 of 1 September 2021 imposing a definitive anti-dumping duty on imports of certain pre- and post-stressing wires and wire strands of non-alloy steel (PSC wires and strands) originating in the People’s Republic of China following an expiry review pursuant to Article 11(2) of the Regulation (EU) 2016/1036 of the European Parliament and of the Council

THE EUROPEAN COMMISSION,

Having regard to the Treaty on the Functioning of the European Union,

Having regard to Regulation (EU) 2016/1036 of the European Parliament and of the Council of 8 June 2016 on protection against dumped imports from countries not members of the European Union (1) (‘basic Regulation’), and in particular Article 11(2) thereof,

Whereas:

(1) Following an anti-dumping investigation (‘the original investigation’), the Council imposed by means of Council Regulation (EC) No 383/2009 (2) as amended by Implementing Regulation (EU) No 986/2012 (3), a definitive anti-dumping duty on imports of certain pre- and post-stressing wires and wire strands of non-alloy steel (‘PSC wires and strands’) originating in the People’s Republic of China (‘China’).

(2) The measures took the form of an ad valorem duty rate of 46,2 %, with the exception of Kiswire Qingdao, Ltd (0 %) as well as Ossen Innovation Materials Co. Joint Stock Company Ltd and Ossen Jiujiang Steel Wire Cable Co. Ltd (both 31,1 %).

(3) Following a first expiry review pursuant to Article 11(2) of the basic Regulation, the Commission, by Commission Implementing Regulation (EU) 2015/865 (4), as last amended by Commission Implementing Regulation (EU) 2019/1382 (5) maintained the measures in force.

(4) Following the publication of a notice of impending expiry (6) of the anti-dumping measures in force on the imports of pre- and post-stressing (‘PSC’) wires and strands originating in the People’s Republic of China (‘the PRC’ or ‘China’), the Commission received a request for review pursuant to Article 11(2) of the basic Regulation.

(5) The request was submitted on 28 February 2020 by the European Stress Information Service (‘ESIS’ or ‘the applicant’), representing more than 25 % of the total Union production of PSC.

(6) The request was based on the grounds that the expiry of the measures would be likely to result in continuation or recurrence of dumping and continuation or recurrence of injury to the Union industry.

(7) Having determined, after consulting the Committee established by Article 15(1) of the basic Regulation, that sufficient evidence existed for the initiation of an expiry review, on 4 June 2020 the Commission initiated an expiry review with regard to imports of PSC wires and strands originating in PRC on the basis of Article 11(2) of the basic Regulation. It published a Notice of Initiation in the Official Journal of the European Union (7) (‘the Notice of Initiation’).

(8) In the Notice of Initiation, the Commission invited interested parties to contact it in order to participate in the investigation. In addition, the Commission specifically informed the applicant, other known Union producers, exporting producers, importers and users in the Union known to be concerned, and the Chinese authorities of the initiation of the expiry review and invited them to participate.

(9) All interested parties had the opportunity to comment on the initiation of the review and to request a hearing with the Commission and/or the Hearing Officer in trade proceedings.

(10) In the Notice of Initiation, the Commission stated that it might sample interested parties, in accordance with Article 17 of the basic Regulation.

(11) In its Notice of Initiation, the Commission stated that it had provisionally selected a sample of Union producers. In accordance with Article 17(1) of the basic Regulation, the Commission selected the sample on the basis of the largest representative volume of sales and production in the Union which could reasonably be investigated within the time available, ensuring also geographical representativeness. This sample consisted of three Union producers. The sampled Union producers accounted for 46 % of the estimated total production in the Union in the review investigation period. The Commission invited interested parties to comment on the provisional sample, but did not receive any comments. The provisional sample was therefore confirmed and is considered representative of the Union industry.

(12) In order to enable the Commission to decide whether sampling would be necessary in respect of the exporting producers in China and of the unrelated importers in the Union, those parties were requested to make themselves known and to provide the Commission with the information requested in the Notice of Initiation. In addition, the Commission requested the Mission of China to the Union to identify and/or contact other exporting producers, if any, that could be interested in participating in the investigation. However, as none of these parties came forward, sampling was not necessary neither for the exporting producers nor the unrelated importers. Since there was no cooperation from the Chinese producers, the findings with regard to the imports from the PRC were made on the basis of the facts available pursuant to Article 18 of the basic Regulation.

(13) The Commission sent questionnaires to the sampled Union producers, as well as to the Government of China (‘GOC’). The same questionnaires as well as questionnaires for importers, users and exporting producers had also been made available online (8) on the day of the initiation.

(14) The Commission received questionnaire replies from the three sampled Union producers as well as from the Union producers’ association (ESIS).

(16) On 5 July 2021, the Commission disclosed the essential facts and considerations on the basis of which it intended to maintain the anti-dumping duties in force. All parties were granted a period within which they could make comments on the disclosure.

(17) Comments were submitted by the applicant. The comments were duly considered and taken into account by the Commission.

(18) The investigation of a continuation or recurrence of dumping covered the period from 1 January 2019 to 31 December 2019 (‘the review investigation period’). The examination of trends relevant for the assessment of the likelihood of a continuation or recurrence of injury covered the period from 1 January 2016 to the end of the review investigation period (‘the period considered’).

(19) This case was initiated on 4 June 2020, i.e. during the transition period agreed between the United Kingdom (‘UK’) and the EU in which the UK remained subject to the Union law. This period ended on 31 December 2020. Consequently, as of 1 January 2021, companies and associations from the UK no longer qualified as interested parties in this proceeding.

(20) By a note to the case file on 18 January 2021, the Commission invited UK operators that considered that they still qualified as interested party to contact it. No company came forward.

(21) In order to align the data set collected from interested parties with the fact that the transition period had ended and that the UK was no longer subject to Union law, interested parties concerned were invited to provide a revised questionnaire reply on EU-27 basis.

(22) The product subject to this review is not plated or not coated wire of non-alloy steel, wire of non-alloy steel plated or coated with zinc and stranded wire of non-alloy steel whether or not plated or coated with not more than 18 wires, containing by weight 0,6 % or more of carbon, with a maximum cross-sectional dimension exceeding 3 mm, currently falling under CN codes ex 7217 10 90, ex 7217 20 90, ex 7312 10 61, ex 7312 10 65 and ex 7312 10 69 (TARIC codes 7217109010, 7217209010, 7312106191, 7312106591 and 7312106991) (‘the product under review’). Galvanised (but not with any further coating material) seven wire strands in which the diameter of the central wire is identical to or less than 3 % greater than the diameter of any of the 6 other wires are not covered by the measures in force and are not subject to this review (10).

(23) The product under review is mostly used as a concrete reinforcement by the construction industry but can also be found in suspension elements and in stay cable bridges. It is produced from high carbon steel wire rods which are cleaned, drawn, heated and – in case of strands – wound together helicoidally to achieve specific characteristics of diameter, resistance and stability.

(25) The Commission concluded that these products are like products within the meaning of Article 1(4) of the basic Regulation.

(26) During the review investigation period, imports of the product under review from the PRC continued, albeit at much lower levels than in the investigation period of the original investigation (i.e. from January 2007 to December 2007). According to Comext (Eurostat) statistics, imports of PSC from the PRC accounted for less than 0,1 % of the Union market in the review investigation period, compared to a market share of 8,2 % during the original investigation. A similarly low level of market share (less than 0,1 %) was noted during the previous expiry review. In absolute terms, imports from the PRC dropped drastically from almost 86 918 tonnes during the original investigation to 99 tonnes in the previous expiry review and 86 tonnes in the current expiry review.

(27) As mentioned in recital (12), none of the exporters/producers from the PRC cooperated in the investigation. Thus, the exporting producers failed to submit questionnaire replies, including any data on export prices and costs, domestic prices and costs, consumption of inputs in the production process, manufacturing overheads, capacity, production, investments, etc. Likewise, the GOC and the exporting producers failed to address the evidence on the case file, including the ‘Commission Staff Working Document on Significant Distortions in the Economy of the People’s Republic of China for the Purposes of Trade Defense Investigations’ (11) (‘the Report’).

(28) Therefore, the Commission informed the authorities of the PRC that due to the absence of cooperation, the Commission might apply Article 18 of the basic Regulation concerning the findings with regard to the PRC. The Commission did not receive any comments.

(29) Consequently, in accordance with Article 18(1) of the basic Regulation, the findings in relation to the likelihood of continuation or recurrence of dumping with regard to the PRC were based on facts available, in particular the information contained in the request for the expiry review and in the submissions by the interested parties, combined with other sources of information, such as trade statistics on imports and exports (Eurostat and GTA), and OECD (12), and independent providers of pricing intelligence, news, data, analysis and conferences for the iron and steel industry such as Global Financials published by Dun & Bradstreet (13) and Global Trade Alert (14).

(30) Given the sufficient evidence available at the initiation of the investigation tending to show, with regard to the PRC, the existence of significant distortions within the meaning of point (b) of Article 2(6a) of the basic Regulation, the Commission initiated the investigation with regard to this country on the basis of Article 2(6a) of the basic Regulation.

(31) In order to obtain information it deemed necessary for its investigation with regard to the alleged significant distortions, the Commission sent a questionnaire to the ‘GOC’. In addition, in point 5.3.2 of the Notice of Initiation, the Commission invited all interested parties to make their views known, submit information and provide supporting evidence regarding the application of Article 2(6a) of the basic Regulation, within 37 days of the date of publication of the Notice of Initiation in the Official Journal of the European Union. No questionnaire reply was received from the GOC and no submission on the application of Article 2(6a) of the basic Regulation was received within the deadline.

(32) In point 5.3.2 of the Notice of Initiation, the Commission also specified that, according to the information available to the Commission, a possible representative third country for the PRC in this case is India. Pursuant to Article 2(6a)(a) of the basic Regulation the representative country is selected for the purpose of determining the normal value based on undistorted prices or benchmarks. The Commission further stated that it would examine other possibly appropriate representative countries in accordance with the criteria set out in 2(6a)(a) first indent of the basic Regulation.

(33) On 18 September 2020, the Commission informed interested parties by a note (‘the First Note’) of the relevant sources it intended to use for the determination of the normal value. In that note, the Commission provided a list of all factors of production such as raw materials, labour and energy that might be used in the production of the product under review. In addition, based on the criteria guiding the choice of undistorted prices or benchmarks, the Commission identified possible representative countries (namely Brazil, Malaysia and Turkey). The Commission received comments on the First Note by the applicant, arguing that Brazil would be significantly less developed than the PRC and therefore be less similar in this criterion than Turkey and Malaysia. Also, relevant and undistorted government data for Brazil for electricity, natural gas and water appears not to be readily available. Further the applicant noted that data extracted for wire rod from GTA referred to code 7213 10, whereas code 7213 91 was more appropriate. The Commission confirmed HS code 7213 91 to correspond to the factor of production wire rod and extracted the data for HS code 7213 91 from GTA. According to this new extract of import data, the Commission’s initial selection of potential representative country was still valid. The applicant maintained its position from the request of India being a suitable representative country, however, did not put forward new arguments. No other countries were suggested as suitable candidates.

(34) On 21 December 2020, the Commission informed the interested parties by a second note (‘the Second Note’) of the relevant sources it intended to use for the determination of the normal value, with Turkey as the representative country. It also informed interested parties that it would establish selling, general and administrative costs (‘SG&A’) and profit based on available information from one producer in the representative country – Celik Halat Vetel Sanayii A.S. No comments on the Second Note were received.

(35) In recent investigations concerning the steel sector in the PRC (15), the Commission found that significant distortions in the sense of Article 2(6a)(b) of the basic Regulation were present. The Commission concluded in this investigation that, based on the evidence available, the application of Article 2(6a) of the basic Regulation was also appropriate.

(36) In those investigations, the Commission found that there is substantial government intervention in the PRC resulting in a distortion of the effective allocation of resources in line with market principles (16). In particular, the Commission concluded that in the steel sector, which is the main raw material to produce the product under review, not only does a substantial degree of ownership by the GOC persist in the sense of Article 2(6a)(b), first indent of the basic Regulation (17), but the GOC is also in a position to interfere with prices and costs through State presence in firms in the sense of Article 2(6a)(b), second indent of the basic Regulation (18). The Commission further found that the State’s presence and intervention in the financial markets, as well as in the provision of raw materials and inputs have an additional distorting effect on the market. Indeed, overall, the system of planning in the PRC results in resources being concentrated in sectors designated as strategic or otherwise politically important by the GOC, rather than being allocated in line with market forces (19). Moreover, the Commission concluded that the Chinese bankruptcy and property laws do not work properly in the sense of Article 2(6a)(b), fourth indent of the basic Regulation, thus generating distortions in particular when maintaining insolvent firms afloat and when allocating land use rights in the PRC (20). In the same vein, the Commission found distortions of wage costs in the steel sector in the sense of Article 2(6a)(b), fifth indent of the basic Regulation (21), as well as distortions in the financial markets in the sense of Article 2(6a)(b), sixth indent of the basic Regulation, in particular concerning access to capital for corporate actors in the PRC (22).

(38) As indicated in recital (28), the GOC did not comment or provide evidence supporting or rebutting the existing evidence on the case file, including the Report and the additional evidence provided by the complainant, on the existence of significant distortions and/or on the appropriateness of the application of Article 2(6a) of the basic Regulation in the case at hand.

(39) Like in previous investigations concerning the steel sector in the PRC, the Commission examined whether it was appropriate or not to use domestic prices and costs in the PRC, due to the existence of significant distortions within the meaning of point (b) of Article 2(6a) of the basic Regulation. The Commission did so on the basis of the evidence available on the file, including the evidence contained in the Report, which relies on publicly available sources. That analysis covered the examination of the substantial government interventions in the PRC’s economy in general, but also the specific market situation in the relevant sector including the product under review. The Commission further supplemented these evidentiary elements with its own research on the various criteria relevant to confirm the existence of significant distortions in the PRC as also found by its previous investigations in this respect.