Commission Implementing Regulation (EU) 2022/2247 of 15 November 2022 imposing a definitive anti-dumping duty and definitively collecting the provisional duty imposed on imports of electrolytic chromium coated steel products originating in the People’s Republic of China and Brazil

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 9(4) thereof,

Whereas:

(1) On 24 September 2021, the European Commission (‘the Commission’) initiated an anti-dumping investigation with regard to imports of electrolytic chromium coated steel (‘ECCS’) originating in the People’s Republic of China (‘the PRC’ or ‘China’) and Brazil (together ‘the countries concerned’) on the basis of Article 5 of the basic Regulation. It published a Notice of Initiation in the Official Journal of the European Union (2) (‘the Notice of Initiation’).

(2) The Commission initiated the investigation following a complaint lodged on 13 August 2021 by the European Steel Association (‘EUROFER’) (‘the complainant’). The complaint contained evidence of dumping and of resulting material injury that was sufficient to justify the initiation of the investigation.

(3) The complaint was made on behalf of the following Union producers: ArcelorMittal Atlantique et Lorraine (France), ArcelorMittal Etxebarri S.A. (Spain) and ThyssenKrupp Rasselstein GmbH (Germany), allegedly representing 100 % of the Union industry. In the course of the investigation, it came to the Commission’s attention the existence of an additional Union producer of ECCS, namely Acciaierie d’Italia. Since the complainants nonetheless represented [85-95] % of the production and sales of the Union industry, the complaint was considered to have been made by the Union industry in accordance with Article 5(4) of the basic Regulation.

(4) 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 complainant, known Union producers, the known exporting producers and the authorities of the PRC and Brazil, known importers, suppliers and users, traders, as well as associations known to be concerned about the initiation of the investigation, and invited them to participate.

(5) In accordance with Article 19a of the basic Regulation, on 25 April 2022, the Commission provided parties with a summary of the proposed duties and details about the calculation of the dumping margins and the margins adequate to remove the injury to the Union industry four weeks before the imposition of provisional duties (‘the pre-disclosure period’). Interested parties were invited to comment on the accuracy of the calculations within three working days. As explained in recitals (29) to (34) of the provisional Regulation, the Commission concluded that the requirements for registration under Article 14(5a) of the basic Regulation were not met. Therefore, imports from the countries concerned have not been subject to registration during the pre-disclosure period.

(6) The Commission received comments from Baoshan Iron & Steel Co., Ltd (‘Baosteel’), Handan Jintai Packing Materials Co., Ltd (‘Jintai’), and CANPACK. The submission of Baosteel led to the correction of a clerical error in the calculations. The comments of Jintai were related to Article 7(2a) of the Basic Regulation and therefore not related to the accuracy of calculations. Therefore they were considered after the disclosure of provisional measures and are addressed in Section 3.1 below. As the comments of CANPACK related to Union interest, they have been addressed in Section 7 below.

(7) On 23 May 2022, the Commission published in the Official Journal of the European Union Implementing Regulation (EU) 2022/802 imposing a provisional anti-dumping duties on imports of electrolytic chromium coated steel products originating in the People’s Republic of China and Brazil (3) (‘the provisional Regulation’).

(8) Following the disclosure of the essential facts and considerations on the basis of which provisional anti-dumping duties were imposed (‘provisional disclosure’), Eurofer (complainant), Eviosys (Union user), CANPACK, representing CANPACK Slovakia s.r.o., Can-Pack Food and Industrial Packaging Sp. z o.o. and Tapon France S.A.S. (Union users), Astir Vitogiannis Bros Single Member S.A. (‘Astir Vitogiannis’) (Union user), Baosteel (exporting producer from China), Jintai (exporting producer from China), Companhia Siderurgica Nacional (‘CSN’) (exporting producer from Brazil), the China Iron and Steel Association (‘CISA’), the Government of the PRC (‘GOC’) and the Government of Brazil (‘GOB’) filed written submissions making their views known on the provisional findings within the deadline provided by Article 2(1) of the provisional Regulation.

(9) The parties who so requested were granted an opportunity to be heard. Hearings took place with Baosteel, CISA and Astir Vitogiannis.

(10) The Commission continued to seek and verify all the information it deemed necessary for its final findings. When reaching its definitive findings, the Commission considered the comments submitted by interested parties and revised its provisional conclusions when appropriate.

(11) On 31 August 2022, the Commission informed all interested parties of the essential facts and considerations on the basis of which it intended to impose a definitive anti-dumping duty on imports of electrolytic chromium coated steel products originating in the People’s Republic of China and Brazil (‘final disclosure’). All parties were granted a period within which they could make comments on the final disclosure.

(12) Following comments from interested parties, the Commission informed, on 16 September 2022, interested parties about some clarifications and minor corrections in the final disclosure that did, however, not have an impact on the definitive duties. Parties were granted a period within which they could make comments. Only CISA made comments.

(13) Parties who so requested were also granted an opportunity to be heard. Hearings took place with CISA, Baosteel, Eviosys and Eurofer.

(14) As explained in recitals (6) and (7) of the provisional Regulation, the China Iron and Steel Association (‘CISA’) submitted comments following initiation claiming that the complaint relied too much on confidential information and that the non-confidential version was therefore insufficient to allow a proper understanding of the evidence underlying the complaint. CISA reiterated this claim following the imposition of provisional measures.

(15) The Commission confirmed its conclusion in recital (8) of the provisional Regulation that the non-confidential version of the complaint available in the file for inspection by interested parties contained all the essential evidence and non-confidential summaries of the confidential data allowing interested parties to properly exercise their rights of defence, and thus rejected the claim.

(16) In the absence of comments regarding the sampling of Union producers, importers and exporting producers, recitals (9) to (17) of the provisional Regulation are confirmed.

(17) As explained in recital (18) of the provisional Regulation, an exporting producer in China, GDH Zhongyue (Zhongshan) Tinplate Industry Co., Ltd. requested individual examination under Article 17(3) of the basic Regulation and provided a questionnaire reply within the deadline. This request was reiterated after the final disclosure. The Commission had provisionally found that an examination of this request would have been unduly burdensome and would not have allowed the completion of the investigation within the time period established in the basic Regulation. The Commission recalled that it had limited its sample to two companies representing the largest volume of imports from China that could reasonably be investigated within the time available. Both companies fully cooperated, which included examination and verification (by means of remote cross-checks or ‘RCCs’) of information provided by several related entities both in China and in the Union which precluded the Commission from individually examining GDH Zhongyue (Zhongshan) Tinplate Industry Co., Ltd. in addition to the sampled companies. This conclusion remained valid also during the definitive stage. The Commission therefore confirmed its decision not to grant individual examination to this company.

(18) As set out in recitals (19) and (21) of the provisional Regulation, the Commission sent questionnaires to three Union producers, the complainant, one unrelated importer and known users, and three exporting producers in the countries concerned. It also sent questionnaires to the Government of the People’s Republic of China (‘GOC’) concerning the existence of significant distortions in the PRC within the meaning of Article 2(6a)(b) of the basic Regulation as well as concerning raw material distortions in China regarding the product under investigation.

(20) As stated in recital (24) of the provisional Regulation, the investigation of dumping and injury covered the period from 1 July 2020 to 30 June 2021 (‘the investigation period’ or ‘IP’). The examination of trends relevant for the assessment of injury covered the period from 1 January 2018 to the end of the investigation period (‘the period considered’).

(21) The Commission recalled that, as set out in recital (25) of the provisional Regulation, the product concerned is flat-rolled products of iron or non-alloy steel, plated or coated with chromium oxides or with chromium and chromium oxides originating in the PRC and Brazil, currently falling under CN codes 7210 50 00 and 7212 50 20 (‘the product concerned’).

(22) ECCS is used in a wide range of applications, typically for consumer and industrial packaging. It is most frequently used for food packaging, for example in can tops and bottoms, screw and lug caps, tabs, etcetera. Other types of uses include external parts for home appliances, photographic film cases, protective material for optical fibre protection or other electrical and electronic parts.

(23) In the absence of any related claim or comment, the conclusions in recital (27) and (28) of the provisional Regulation are hereby confirmed.

(24) Following provisional disclosure, the Commission received written comments from the two sampled exporting producers, CISA and the Government of the People’s Republic of China (‘GOC’) on the provisional dumping findings.

(25) The details of the calculation of the normal value were set out in recitals (42) to (109) of the provisional Regulation.

(26) Following provisional disclosure, CISA and the GOC commented on the application of Article 2(6a) of the basic Regulation in the current investigation. In addition, Baosteel endorsed CISA’s comments.

Arguments concerning the Report (4)

(27) The GOC submitted that the Report is factually and legally flawed and decisions based on it lack legitimacy. On the factual side, the Report is, according to the GOC, misrepresentative, one-sided and out of touch with reality. Moreover, the fact that the Commission has issued country reports for a few selected countries raises concerns about most favoured nation (‘MFN’) treatment. Further, relying by the Commission on the evidence in the Report is, in the GOC’s view, not in line with the spirit of fair and just law, as it provides unfair advantages to the Union industry and as it effectively amounts to judging the case before trial.

(28) Similarly, CISA submitted that the Commission relied excessively on the Report, which in CISA’s opinion is one-sided, non-objective, outdated, and deliberately omits factual elements to facilitate lodging of the complaints based on the application of Article 2(6a) of the basic Regulation. CISA furthermore disagreed with the Commission’s reply in Section 3.1.3 of the provisional Regulation, where the Commission argued that both the GOC as well as other parties had the opportunity to submit information rebutting the sources included in the Report by specifying that the burden of proof lies in this case with the investigating authority and not the third country exporters. In addition, CISA underlined that the Report did not concern the ECCS industry but it is simply a one-size-fits-all document which the Commission uses for various investigations indiscriminately. Furthermore, CISA submitted that the Five-Year Plans (‘FYP’) to which the Commission refers in its investigation to prove the existence of significant distortions are merely guiding documents expressing policy views for the future, similar to such documents published also in the European Union, and hence not distortive. Finally, CISA submitted that the 13th FYP referred to in the Report only covers the period until 2020, meaning it was not relevant for the second part of the investigation period.

(29) The Commission disagreed. These arguments were already largely addressed in the provisional Regulation and the Commission therefore confirmed the conclusions from recitals (68) to (70) of the provisional Regulation. The Commission failed to see how, for example, referring to Chinese legislation in force can be out of touch with reality. Similarly, CISA claimed that the Commission omits factual circumstances, elements and conclusions which would contradict the purpose of the Report, without pointing out which specific factual circumstances or elements would put in question the existence of significant distortions in the sense of Article 2(6a) of the basic Regulation. Concerning the burden of proof, the Report as well as the other evidence put forward meant that the Commission had satisfied its burden of proof, and that neither CISA nor other interested parties had been able to rebut the evidence put forward. The Commission further underlined that the FYPs published by the GOC are not merely general guidance documents, but are of a legally binding nature. In this respect, the Commission referred to the detailed analysis of the plans in Chapter 4 of the Report, with a section specifically dedicated to the binding nature of plans in Section 4.3.1.

(30) With regard to the claim that 13th FYP was irrelevant for the second part of the investigation period (1 January – 30 June 2021), the Commission reiterated, as already stated in recital (69) of the provisional Regulation, that the 14th FYPs only started being published throughout 2021. As an example, the General 14th FYP was published on 12 March, the 14th FYP on Scrap Steel on 15 September and the 14th FYP on Developing Raw Materials on 21 December 2021. The Commission noted that during the period between the date of application of the 13th FYP and the publication of the 14th FYP, the provisions of the 13th FYP were still applicable. In any event, irrespective of when exactly individual 14th FYPs were published, the fact that the 13th FYP was applicable during the first half of the investigation period is already indicative of the existence of significant distortions within the meaning of Article 2(6a) of the basic Regulation. This claim was therefore dismissed.

(31) Upon final disclosure, the GOC re-submitted its claims concerning the Report, without adding any further elements to its argumentation. The Commission therefore noted that these claims were already addressed in recitals (68) to (70) of the provisional Regulation, as well as in recital (29) above.

(32) Similarly, CISA repeated its criticism of the Report following the final disclosure, restating its view that the Report fails to meet the standards of impartial and objective evidence. In addition, CISA raised again the issue of the 13th FYP, pointing out that, on the one hand, the plan should not be considered to be binding law but rather a general policy document, which exists also in the EU, and that, on the other hand, half of the IP falls outside of the period covered by the 13th FYP. In that connection, CISA invited the Commission to explain how the content of the 13th FYP can be considered as evidence of significant distortions after its application expired.

(33) The Commission disagreed. First of all, as already pointed out in recital (29) above, China operates a periodic five year planning cycle. In that cycle, individual planning documents for the following cycle are being prepared already in the course of the previous one while, at the same time, individual planning documents of the following cycle may be formally issued with some delay after the expiry of the corresponding planning documents of the previous cycle. The fact that the formal end date of the 13th FYP may fall into the middle of the IP or that the relevant 14th FYPs were published with a certain time gap following the end of the previous planning period cannot alter the nature of Chinese planning system in which the authorities and business operators always find themselves being part of a planning cycle. The Commission also disagreed with CISA’s argument that the 13th FYP was a mere general policy document on public investment priorities. To start with, CISA did not bring any argument calling into question the Commission’s analysis in Section 4.3.1. of the Report, as referred to in recital (29) above. Moreover, CISA’s comparison of the Commission’s ‘New Industrial Strategy’ with the 13th FYP is misplaced on a number of levels, such as the typology of the documents (a Commission communication to the European Parliament and other EU institutions compared to a document actually adopted by the Chinese highest legislative body) as well as their nature and substance (an explanatory document outlining policy priorities compare to a prescriptive guidance replete with industrial output targets and explicit implementation obligations for all subjects concerned).

(34) Consequently, the arguments brought by the GOC and CISA were rejected and the Commission’s confirmed its conclusions in recitals (68) to (70) of the provisional Regulation.

Arguments concerning WTO compatibility of Article 2(6a) of the basic Regulation

(35) First, the GOC, as well as CISA, argued that constructing the normal value in accordance with Article 2(6a) of the basic Regulation is inconsistent with the WTO Anti-Dumping Agreement (‘ADA’), in particular with Article 2.2. of the ADA which provides an exhaustive list of situations where the normal value can be constructed, the ‘significant distortions’ not being listed among such situations.