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

• (144) The Commission established the profitability of the Union industry by expressing the pre-tax net profit of the sales of the like product to unrelated customers in the Union as a percentage of the turnover of those sales. Overall, profitability was low, fluctuating around break-even point during the period considered, except for 2018. More specifically, the profitability of the sampled Union producers improved during the period considered up to 2018 from 2 % to reach 6 %, when high demand resulting from the market growth in the Union construction sector was coupled with the ability of the Union PSC producers to pass on the wire rod cost increases. Profitability then dropped slightly below a break-even point in the RIP. The negative profitability and decline in sales prices in 2019 resulted from weaker than expected demand and high prices of wire rod in the said year.

• (145) The net cash flow is the Union industry’s ability to finance its activities. The net cash flow remained positive over the entire period considered and in the second half of the period showed the same trend as profitability, i.e. a marked improvement in the 2018, followed by a drop of 16 % in the review investigation period compared to the beginning of the period considered.

• (146) The fourfold increase in investments over the period considered is indicative of the Union industry’s continued efforts to increase efficiency, penetrate new markets and remain competitive on the Union market as well as globally. The investments mainly concerned upgrade and replacement of the production facilities and equipment.

• (147) The return on investment from the production and sale of the like product showed the same trend as profitability, being positive for the first three years of the period considered, sharply increasing in 2018 to then turning negative (- 9 %) in the review investigation period.

4.5.4.   Conclusion on the situation of the Union industry

• (148) The investigation showed that the situation of the industry on a macro level was stable, in line with the overall modestly increasing trend in consumption (+ 1 % over the period considered), which influenced the modest increase in the Union industry’s production and sales volume.

• (149) The investigation has also shown that the situation of the industry on a micro level was rather positive, although still vulnerable. Profitability and cash flow have been positive over the period considered, with the profitability only turning negative (yet, very close to break-even) in the review investigation period due to lower than projected demand in the construction sector. However, with a recovery in the Union construction market, the situation of the Union industry is expected to improve.

• (150) The economic situation of the Union industry was thus non-injurious and the existence of anti-dumping measures on the imports of the product under review from China was the main reason for the relatively positive situation.

• (151) On the basis of the above, the Commission concluded that the Union industry did not suffer material injury during the review investigation period within the meaning of Article 3(5) of the basic Regulation.

5. LIKELIHOOD OF A RECURRENCE OF INJURY

• (152) The Commission concluded in recital (151) that the Union industry did not suffer material injury during the review investigation period. Thus, the Commission further examined the likelihood of recurrence of injury originally caused by dumped imports from China if measures were allowed to lapse.

• (153) To establish the likelihood of recurrence of injury should the measures lapse, the following elements were analysed: (a) production capacity and spare capacity in China; (b) likely price levels of imports from China in the absence of anti-dumping measures; and (c) attractiveness of the Union market.

5.1.   Production capacity and spare capacity in China

• (154) Despite the significant Chinese consumption, the pace of production (in excess of 233 000 tonnes) exceeded the domestic consumption, hence increasing pressure on exports to third countries.

• (155) Moreover, China’s over-capacity is also apparent – according to the information provided by the applicant, China had an annual output of around 3,6 million tonnes for PSC wires and strands in 2019 and an estimated capacity of between 4,5 and 5,6 million tonnes ⁴⁷. Unused spare production capacity in China (that is around 2 million tonnes) is at least three times the size of the Union market.

5.2.   Likely price levels of imports from China in the absence of anti-dumping measures and impact on the Union industry

• (156) In recital (96) it was concluded that it is likely that the Chinese exporting producers would export large quantities of PSC wires and strands to the Union should measures be allowed to lapse and that these exports would likely be made at dumped prices.

• (157) Imposition of measures in 2009 appears to have dissuaded Chinese exporters from continuing dumping their product on the Union market in large volumes and at low prices. As a result, there are only insignificant volumes of imports from China into the Union.

• (158) As regards, Chinese export prices to their main export destinations (South Korea and Philippines, accounting for approximately 40 % of the Union consumption) undercut the Union industry’s sales price by 20,3 %. This shows that Chinese exporters have been redirecting major proportion of their exports to other markets at price levels much lower than Union industry’s sales price on the Union market.

5.3.   Attractiveness of the Union market

• (159) As mentioned in recitals (97) and (98), the Union market is attractive in terms of size and price level.

• (160) The large size of the Union market, current relative strength of its currency and higher Union prices compared to other major third country markets for Chinese producers, make the Union a highly attractive market. Indeed, the high likely undercutting margin based on a comparison of Chinese export prices to third countries and Union industry prices, makes the Union market more attractive than other major export markets to Chinese producers. If measures are allowed to lapse, the Chinese exporting producers could export to the Union at prices above those to third countries whilst still undercutting the Union industry’s prices.

• (161) Moreover, as mentioned in recital (95), also other big markets, such as US, Brazil, Canada and Turkey have measures against imports of PSC from China. Therefore, should the Union measures lapse, the Union would naturally be a very attractive market for Chinese exports.

5.4.   Conclusion

• (162) In view of the findings of the investigation, namely the estimated Chinese spare capacity and the expected price levels of Chinese exports to the EU, it is considered that the non-extension of the measures would in all likelihood lead to a recurrence of injury and would deteriorate the still vulnerable situation of the Union industry due to the likely increase of Chinese imports at dumped prices undercutting the Union industry’s sales prices.

6. UNION INTEREST

• (163) In accordance with Article 21 of the basic Regulation, the Commission examined whether maintaining the existing anti-dumping measures against China would be against the interest of the Union as a whole. The determination of the Union interest was based on an appreciation of all the various interests involved, including those of the Union industry, importers and users.

• (164) All interested parties were given the opportunity to make their views known pursuant to Article 21(2) of the basic Regulation.

• (165) On this basis, the Commission examined whether, despite the conclusions on the likelihood of a recurrence of dumping and recurrence of injury, compelling reasons existed which would lead to the conclusion that it was not in the Union interest to maintain the existing measures. It is recalled that, in the original investigation, the adoption of measures was considered not to be against the interest of the Union.

6.1.   Interest of the Union industry

• (166) As explained in recital (150), the measures enabled the Union industry to create and uphold its relatively positive microeconomic situation. Union industry is recovering and has taken measures to improve efficiency and invested to remain competitive. However, the industry is still vulnerable, as evidenced by the profit levels around break-even resulting from a limited ability to pass on the raw material price increases and a decline in activity in the construction sector (which has high volatility of demand). Termination of the measures would therefore likely result in recurrence of material injury by the low-priced dumped imports that would enter the Union market, leading to a further deterioration of the vulnerable state of the Union industry.

• (167) Should the measures be maintained, it is expected that the Union industry will be able to realise its operating investments, eventually improve its profitability and preserve the sizeable workforce.

• (168) Therefore, the continuation of the measures against China would benefit the Union industry.

6.2.   Interest of importers/traders

• (169) As mentioned in recital (12), no importers came forward following the publication of the notice of initiation and during the investigation (situation similar to the previous expiry review). Although it cannot be ruled out that the imposition of the measures had a negative impact on their activity, importers are not dependent on China and can source the product under review from other supplying countries such as Thailand and Russia. Therefore, it is concluded (similar to the conclusion reached in the previous expiry review investigation) that from the importers’ perspective, there are no compelling reasons not to extend the existing measures.

6.3.   Interest of users

• (170) No user came forward following the publication of the notice of initiation and during the investigation. Therefore, there were no indications that the conclusions reached in the last expiry review investigation ⁴⁸ are no longer valid and that the maintenance of the measures would have a negative impact on the users outweighing the positive impact of the measures.

6.4.   Conclusion on Union interest

• (171) In view of the above, the Commission concluded that there were no compelling reasons of Union interest against the extension of the current anti-dumping measures on imports from China.

7. ANTI-DUMPING MEASURES

• (172) It follows from the above considerations that, under Article 11(2) of the basic Regulation, the anti-dumping measures applicable to 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, applicable under Regulation (EU) 2015/865, as amended by Regulation (EU) 2019/1382 should be maintained.

• (173) The individual company anti-dumping duty rates specified in this Regulation are exclusively applicable to imports of the product under review produced by the named legal entities. Imports of the product under review produced by any other company not specifically mentioned in the operative part of this Regulation, including entities related to those specifically mentioned, cannot benefit from these rates and should be subject to the duty rate applicable to ‘all other companies’. They should not be subject to any of the individual anti-dumping duty rates.

• (174) A company may request the application of these individual anti-dumping duty rates if it changes subsequently the name of its entity. The request must be addressed to the Commission ⁴⁹. The request must contain all the relevant information enabling to demonstrate that the change does not affect the right of the company to benefit from the duty rate which applies to it. If the change of name of the company does not affect its right to benefit from the duty rate which applies to it, a regulation about the change of name will be published in the Official Journal of the European Union.

• (175) All interested parties were informed of the essential facts and considerations on the basis of which it was intended to recommend that the existing measures be maintained. They were also granted a period to make representations subsequent to this disclosure. Comments were received from the applicant on the scope of the safeguard measures described in recitals (177)-(178) below.

• (176) In view of Article 109 of Regulation (EU, Euratom) 2018/1046 ⁵⁰, when an amount is to be reimbursed following a judgment of the Court of Justice of the European Union, the interest to be paid should be the rate applied by the European Central Bank to its principal refinancing operations, as published in the C series of the Official Journal of the European Union on the first calendar day of each month.

• (177) By Commission Implementing Regulation (EU) 2019/159 ⁵¹, the Commission imposed a safeguard measure with respect to certain steel products for a period of three years. By Commission Implementing Regulation (EU) 2021/1029 ⁵², the safeguard measure was prolonged until 30 June 2024. The product under review (more specifically the product currently falling under CN codes ex 7217 10 90, ex 7217 20 90) is one of the product categories covered by the safeguard measure. Consequently, once the tariff quotas established under the safeguard measure are exceeded, both the above-quota tariff duty and the anti-dumping duty would become payable on the same imports. As such cumulation of anti-dumping measures with safeguard measures may lead to an effect on trade greater than desirable, the Commission decided to prevent the concurrent application of the anti-dumping duty with the above-quota tariff duty for the product under review for the duration of the imposition of the safeguard duty.

• (178) This means that where the above-quota tariff duty referred to in Article 1(6) of Implementing Regulation (EU) 2019/159 becomes applicable to the product under review and exceeds the level of the anti-dumping duties pursuant to this Regulation, only the above-quota tariff duty referred to in Article 1(6) of Implementing Regulation (EU) 2019/159 shall be collected. During the period of concurrent application of the safeguard and anti-dumping duties, the collection of the duties imposed pursuant to this Regulation shall be suspended. Where the above-quota tariff duty referred to in Article 1(6) of Implementing Regulation (EU) 2019/159 becomes applicable to the product under review and is set at a level lower than the level of the anti-dumping duties in this Regulation, the above-quota tariff duty referred to in Article 1(6) of Implementing Regulation (EU) 2019/159 shall be collected in addition to the difference between that duty and the level of the anti-dumping duties imposed pursuant to this Regulation. The part of the amount of anti-dumping duties not collected shall be suspended.

• (179) The measures provided for in this Regulation are in accordance with the opinion of the Committee established by Article 15(1) of the basic Regulation,

HAS ADOPTED THIS REGULATION:

Article 1

(1) A definitive anti-dumping duty is hereby imposed on imports of 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) and originating in the People’s Republic of China. 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 shall not be covered by the definitive anti-dumping duty.

(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 and produced by the companies listed below, shall be as follows:

(3) The application of the individual duty rate specified for the companies mentioned in paragraph 2 shall be conditional upon presentation to the customs authorities of the Member States of a valid commercial invoice, which shall conform to the requirements set out in the Annex. If no such invoice is presented, the duty rate applicable to all other companies shall apply.

(4) To prevent the concurrent application of the anti-dumping duty with the safeguard measure imposed by Implementing Regulation (EU) 2019/159, where the quota tariff duty referred to in Article 1(6) of Implementing Regulation (EU) 2019/159 becomes applicable to the product under review and exceeds the level of the anti-dumping duties pursuant to this Regulation, only the quota tariff duty referred to in Article 1(6) of Implementing Regulation (EU) 2019/159 shall be collected. During the period of concurrent application of the safeguard and anti-dumping duties, the collection of the duties imposed pursuant to this Regulation shall be suspended. Where the above-quota tariff duty referred to in Article 1(6) of Implementing Regulation (EU) 2019/159 becomes applicable to the product under review and is set at a level lower than the level of the anti-dumping duties in this Regulation, the above-quota tariff duty referred to in Article 1(6) of Implementing Regulation (EU) 2019/159 shall be collected in addition to the difference between that duty and the level of the anti-dumping duties imposed pursuant to this Regulation. The part of the amount of anti-dumping duties not collected shall be suspended.

(5) Unless otherwise specified, the provisions in force concerning customs duties shall apply.

Article 2

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.

Done at Brussels, 1 September 2021.

For the Commission

The President

Ursula VON DER LEYEN

www.gov.cn/zhengce/content/2016-02/04/content_5039353.htm (last viewed 6 May 2021); https://policycn.com/policy_ticker/higher-expectations-for-large-scale-steel-enterprise/?iframe=1&secret=c8uthafuthefra4e (last viewed 6 May 2021), and

www.xinhuanet.com/english/2019-04/23/c_138001574.htm (last viewed 6 May 2021).

https://en.ndrc.gov.cn/newsrelease_8232/201612/P020191101481868235378.pdf (last viewed 6 May 2021).

Actual weekly working hours and monthly average labour costs by economic activity, 2012, 201 6’ published on https://data.tuik.gov.tr/Search/Search?text=labour

ANNEX

A declaration dated and signed by an official of the company, in the following format must appear on the valid commercial invoice referred to in Article 1(3):

• 1. The name and function of the official of the company which has issued the commercial invoice.

• 1. The following declaration:

‘I, the undersigned, certify that the [volume] of PSC wires and strands sold for export to the European Union covered by this invoice was manufactured by (company name and registered seat) (TARIC additional code) in (country concerned). I declare that the information provided in this invoice is complete and correct.’

Date and signature