Commission Implementing Regulation (EU) 2022/2001 of 21 October 2022 imposing a definitive anti-dumping duty on imports of aspartame originating in the People’s Republic of China, following an expiry review pursuant to Article 11(2) of 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) (‘the basic Regulation’), and in particular Article 11(2) thereof,

Whereas:

(1) By Regulation (EU) 2016/1247 (2), the European Commission imposed anti-dumping duties on imports of aspartame, originating in the People’s Republic of China (‘the PRC’, ‘China’ or ‘the country concerned’) (‘the original measures’ or ‘original investigation’). The investigation that led to the imposition of the original measures will hereinafter, be referred to as ‘the original investigation’.

(2) The anti-dumping duties currently in force are at rates ranging between 55,4 % and 59,4 % on imports from the sampled exporting producers, 58,8 % on the non-sampled cooperating companies and a duty rate of 59,4 % on all other companies from the PRC.

(3) Following the publication of a notice of impending expiry (3), the European Commission (‘the Commission’) received a request for a review pursuant to Article 11(2) of the basic Regulation.

(4) The request for review was submitted on 26 April 2021 by HSWT France S.A.S. (‘HSWT’ or ‘the applicant’), the sole manufacturer in the Union of aspartame and thus constituting the Union industry of aspartame in the sense of Article 5(4) of the basic Regulation.

(5) The request for review was based on the grounds that the expiry of the measures would be likely to result in continuation of dumping and recurrence of injury to the Union industry (4).

(6) 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 29 July 2021 the Commission initiated an expiry review with regard to imports into the Union of aspartame originating in the 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 (5) (‘the Notice of initiation’).

(7) The investigation of continuation or recurrence of dumping covered the period from 1 July 2020 to 30 June 2021 (‘review investigation period’ or ‘RIP’). The examination of trends relevant for the assessment of the likelihood of a continuation or recurrence of injury covered the period from 1 January 2018 to the end of the review investigation period (‘the period considered’).

(8) In the Notice of initiation, interested parties were invited to contact the Commission in order to participate in the investigation. In addition, the Commission specifically informed the applicant, the known producers of aspartame in the PRC and the authorities of the PRC, as well as known importers and users, about the initiation of the expiry review investigation and invited them to participate.

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

(10) Hearings took place with the sole exporting producer cooperating with the investigation ‘Changmao Biochemical Engineering Co., Ltd (‘Changmao’)’.

(11) The Commission received comments on initiation from Changmao. The applicant also provided comments in this regard.

(12) Changmao argued that it was likely that the complainant in the original investigation Ajinomoto Sweeteners Europe SAS was not an independent legal entity established in France, but only a branch of Ajinomoto Inc. Furthermore, it was claimed that the branch used audit reports that formed an integral part of Ajinomoto Inc. in Japan, which exaggerated the cost of the French factory by using internal valuation, transfer pricing and costing methods, which distorted the production cost of aspartame in Europe and resulted in the imposition of an anti-dumping duty.

(13) The Commission notes that these claims refer to the original investigation that was completed in July 2016 (6) and therefore they were rejected as they were irrelevant for the current investigation.

(14) Changmao also argued that the initiation of the investigation was illegal without the pre-examination of the identity of the Dutch investment Fund, Standard Investment, which acquired some of the aspartame production assets of Hyet Sweet and hired certain employees of Hyet Sweet in the course of the bankruptcy procedure of Hyet Sweet. It was pointed out that it was not clear whether this fund was a related entity of Ajinomoto Inc. and the fund may have served the purpose of concealing capital sources in Japan, thereby protecting the interests of Ajinomoto Inc. against the imports of aspartame from the PRC via misuse of EU anti-dumping procedures.

(15) The Commission notes that pursuant to Article 11(2) of the basic Regulation, the Commission must initiate a review of the anti-dumping measures in force when sufficient evidence of a likelihood of dumping and injury exists to justify the initiation of an expiry review. The request for review submitted by HSWT referred to in recital (4) included such information. The investigation covers imports of aspartame from the PRC. Whether the shareholder of the applicant is related to a Japanese producer of aspartame is not relevant for the initiation of this investigation. Therefore, the claim was rejected.

(16) Changmao also argued that the Commission should not have initiated this expiry review investigation as there was no reference in the Notice of initiation to the circumstances of the bankruptcy of Hyet Sweet or any preliminary justification as to the reasons HSWT’s request for review would appear compliant with the requirements of Article 11(9) of the basic Regulation. It was further argued that the Commission had disregarded the impact of Hyet Sweet’s bankruptcy on the standing of HSWT for the initiation of the expiry review.

(17) The Commission notes that Article 11(9) of the basic Regulation does not include any provisions about changes in the composition of the Union industry. Furthermore, Changmao did not explain why Hyet Sweet’s bankruptcy would affect HSWT’s standing for the initiation of the expiry review investigation and why the reasons for the bankruptcy of Hyet Sweet should be mentioned in the Notice of initiation. At the moment of the examination of the expiry review request, Hyet Sweet did not exist anymore and HSWT was the sole producer of aspartame in the Union. Therefore, these claims were rejected.

(18) Changmao argued that the Commission was not in a position to review the injury assessment originally conducted for Ajinomoto Inc.’s aspartame producing branch (since 2016 Hyet Sweet SAS) by reference to a different company, HSWT, in the course of the present expiry review. Furthermore, it was stated that several injury indicators during the three-year period preceding the initiation of the current investigation would relate to Hyet Sweet SAS that went bankrupt in the middle of this period and was not succeeded by HSWT as HSWT allegedly bought only certain assets from Hyet Sweet and took over only part of Hyet Sweet’s employees.

(19) In an anti-dumping investigation initiated pursuant to Article 5 or 11(2) of the basic Regulation, the Commission needs to assess the injury suffered by the whole Union industry and not by a particular producer. The Union industry can be constituted of one or several Union producers. Furthermore, whether the composition of the Union industry changed between the original investigation and the expiry review investigation has no bearing on the latter. This is because the purpose of an expiry review investigation is to assess whether the measures in force should be continued or terminated following an assessment of whether the expiry of the measures would likely lead to a continuation or recurrence of dumping, and material injury to the Union industry. Furthermore, the fact that the injury indicators before 2019 relate to Hyet Sweet SAS and as of 2019 relate to HSWT, both being Union producers of aspartame, is irrelevant since the Commission’s injury assessment is conducted on the Union industry and not on specific producers. Therefore, the claims were rejected.

(20) Changmao further claimed that in the review request, HSWT provided two different sets of data on Union consumption. The first set used the consumption estimated by Allied Market Research (‘AMR’), the Chinese imports were based on Chinese export statistics, while the Japanese imports were calculated as the difference between total consumption and the sum of Chinese exports and EU sales. The second set of data used the imports from China and Japan from the 14(6) database. Changmao indicated that there were large discrepancies between the two data sets and that the Commission failed to take these discrepancies into account when deciding to initiate the expiry review investigation, contrary to the requirements of Article 11(9) of the basic Regulation which require that the request for review should be predicated on reliable and coherent data. Furthermore, in March 2022, Changmao requested the Commission to verify the accuracy of Union consumption data set out in Table 4 of the request for review and to modify the Union consumption data set out in Table 2 of the request for review.

(21) First, the Commission established the Union consumption during the investigation as explained in recitals (178) to (181), revising the data provided in the request when necessary. Second, in relation to the inconsistencies of the statistics used, the Commission notes that the 14(6) database does not include imports under inward processing while the Chinese export statistics database includes all the Chinese exports. As explained in recital (190), a significant volume of imports from the PRC were made under the inward processing system. Furthermore, the 14(6) database includes imports made according to customs applicable rules in the Member States where the importation is made, while the Chinese database includes exports made according to the Chinese customs rules. Therefore, there could be differences between the total volume of imports from China in the 14(6) database or Eurostat for a certain product and the volume of exports from China to the Union in the Chinese database. Moreover, while Changmao seems to misquote Article 11(9) of the basic Regulation, the Commission did examine the accuracy and adequacy of the evidence provided in the request for review and considered that the overall figures and trends from the different sources constituted sufficient evidence to justify the initiation of an investigation. Therefore, the claim was rejected.

(22) Changmao argued that the anti-dumping measures on imports of aspartame from the PRC did not protect the Union industry but promoted the imports of aspartame from Japan. Changmao claimed that these imports increased after the imposition of the anti-dumping measures traditionally at high prices and high volumes at the cost of Union users and consumers. Changmao criticized the Commission for not requesting HSWT to clarify this matter. It further argued that the imports from Japan were related to the bankruptcy of Hyet Sweet and, although the Commission was aware of Hyet Sweet’s bankruptcy, it did not request HSWT to clarify the reasons for the bankruptcy. Furthermore, it was stated that if the measures in place could not prevent Hyet Sweet from going bankrupt, this meant that there was no causal link between Hyet Sweet’s bankruptcy and imports from the PRC.

(23) The purpose of the imposition of the anti-dumping measures is meant to restore the level playing field in the Union market. Aspartame is manufactured only in the Union, the PRC and Japan. Japan is therefore just another source of imports of aspartame. The fact that the imports from Japan increased after the imposition of anti-dumping measures on imports of aspartame from the PRC is irrelevant for the current expiry review investigation. Changmao also did not explain why the Commission should have asked the applicant to explain the increase of imports of aspartame from Japan. Furthermore, Changmao’s claim that the imports from Japan were related to the bankruptcy of Hyet Sweet was not substantiated by any evidence. Therefore, these claims were rejected.

(24) Changmao further claimed that according to a statement published on the internet by HSWT and the Chinese company Vitasweet in September 2019, the two companies stated that they had reached an agreement that Vitasweet would provide HSWT with aspartame at a competitive price (7). It was further claimed that if Hyet Sweet or HSWT imported aspartame from the PRC, these imports did not cause any injury to Hyet Sweet or HSWT but promoted its development. If there was injury, then it was self-inflicted. Furthermore, it was stated that HSWT did not clarify whether it was the largest importer of aspartame from Japan and the PRC in the request for review and the Commission had failed to properly assess HSWT’s standing under Article 11(9) of the basic Regulation. Moreover, Changmao argued that being the largest EU aspartame importer would be sufficient to exclude HSWT from the definition of the Union industry.

(25) The Commission notes that the claims above include several pieces of factually incorrect information. The statement published on the internet referred to above was not made by HSWT but by the Chinese company Vitasweet on its website and it refers to an agreement with Hyet Sweet and not HSWT. HSWT and Hyet Sweet are two different entities and are not related, as explained in recital (39). Moreover, HSWT did not import and/or sell aspartame from the PRC during the review investigation period. Furthermore, as this investigation covers imports of aspartame from the PRC, the question of whether HSWT has imported aspartame from Japan during the review investigation period is irrelevant for the standing exercise. Therefore, the claims were rejected.

(26) The Commission’s analysis confirmed that none of the elements mentioned by Changmao, whether factually correct or not, were sufficient to call into question the conclusion that the request for review contained sufficient evidence tending to show that the expiry of the measures would likely result in a continuation of dumping and recurrence of injury. These aspects had been established on the basis of the best evidence available to the applicant at the time, and were sufficiently representative and reliable. Furthermore, the claims put forward by Changmao and the rebuttals by the applicant were examined in detail in the course of the investigation and are further addressed below. On the basis of the above, the Commission confirmed that the request provided sufficient evidence that the expiry of the measures would likely result in a continuation of dumping and recurrence of injury, thereby satisfying the requirements set out in Article 11(2) of the basic Regulation.

(27) In their comments following final disclosure, Changmao disputed the Commission’s assessment that whether the final shareholder of the applicant was related to a Japanese producer was not relevant for the initiation of the investigation. Changmao claimed that only a complete disclosure of HSWT’s ownership structure could provide a thorough and comprehensive understanding about HSWT and thus a better understanding on the injury or no injury on the Union producer and the causes thereof. Furthermore, Changmao claimed that the name of the ultimate beneficiary and controlling shareholders referred to by HSWT and the Commission as ‘Standard investment’ was incorrect and should be corrected.

(28) As indicated in recital (15), whether the beneficiary shareholder of the applicant was related to a Japanese producer was not relevant for the initiation of the investigation as the investigation concerns imports of aspartame from the PRC and not Japan. Furthermore, the ultimate shareholder of the Union producer has no bearing on the injury assessment made by the Commission in the framework of the current investigation. Moreover, as indicated in recital (45), in the course of the investigation, HSWT disclosed a chart with Hyet Sweet SAS’s group structure until December 2018, a chart with HSWT/Standard Investment’s group structure in February 2022 and a comparison chart between the current structures of Hyet Sweet SAS and HSWT/Standard Investment. HSWT also provided sensitive information to the Commission with regard to its ultimate beneficial owner. This sensitive information does not indicate any relationship with Ajinomoto Japan. Furthermore, ‘Standard Investment’ is the overall non-formal name for the various entities of the group that HSWT belongs to. SIF III Holding Cooperatief U.A. is one of these entities. (‘SIF III’ stands for ‘Standard Investment Fund 3’). Therefore these claims were rejected.

(29) In view of the apparent large number of producers in the country concerned and unrelated importers in the Union, the Commission stated in the Notice of initiation that it might sample the exporting producers and unrelated importers in accordance with Article 17 of the basic Regulation.

(30) To decide whether sampling was necessary and, if so, to select a sample, the Commission asked unrelated importers to provide the information specified in the Notice of initiation.

(31) Two companies provided the requested information and agreed to be included in the sample. In view of the low number, the Commission decided that sampling was not necessary. One of these companies was requested to complete the questionnaire for unrelated importers. The other appeared to be a user and was therefore, requested to complete the users’ questionnaire.

(32) To decide whether sampling was necessary and, if so, to select a sample, the Commission asked all producers in the PRC to provide the information specified in the Notice of initiation. In addition, the Commission asked the Mission of the People’s Republic of China to the European Union to identify and/or contact other producers, if any, that could be interested in participating in the investigation.

(33) Two exporting producers in the country concerned, Vitasweet Jiangsu Co., Ltd (‘Vitasweet’) and Changmao, provided the requested information and agreed to be included in the sample. In view of the low number, the Commission decided that sampling was not necessary.

(34) The Commission sent a questionnaire concerning the existence of significant distortions in the PRC within the meaning of Article 2(6a)(b) of the basic Regulation to the Government of the People’s Republic of China (‘GOC’).

(35) The Commission sent letters with links to questionnaires to exporting producers (Vitasweet and Changmao), HSWT and known unrelated importers and users on the day of initiation. The same questionnaires were also made available in the file for inspection by interested parties and on DG Trade’s website online (8) on the day of initiation.

(36) Questionnaire replies were received from only one exporting producer (Changmao), HSWT and one user, Mars Polska sp. z o.o. No unrelated importer submitted a questionnaire response.