Commission Implementing Regulation (EU) 2023/611 of 17 March 2023 amending Regulation (EC) No 88/97 on the authorisation of the exemption of imports of certain bicycle parts originating in the People’s Republic of China from the extension by Council Regulation (EC) No 71/97 of the anti-dumping duty imposed by Council Regulation (EEC) No 2474/93

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’),

Having regard to Council Regulation (EC) No 71/97 of 10 January 1997 extending the definitive anti-dumping duty imposed by Regulation (EEC) No 2474/93 on bicycles originating in the People’s Republic of China to imports of certain bicycle parts from the People’s Republic of China, and levying the extended duty on such imports registered under Regulation (EC) No 703/96 ², and in particular Article 3 thereof,

Whereas:

• (1) An anti-dumping duty (‘the extended duty’) currently applies on imports into the Union of essential bicycle parts originating in the People’s Republic of China (‘the PRC’) as a result of the extension by Regulation (EC) No 71/97.

• (2) Pursuant to Article 3 of Regulation (EC) No 71/97 an exemption scheme should be established in order to authorise the exemption of imports of essential bicycle parts which do not circumvent the anti-dumping duty (‘the Exemption Scheme’). That Exemption Scheme is governed by Article 13(4) of the basic Regulation. The Exemption Scheme exempts assemblers that are found not to be engaged in practices circumventing the anti-dumping measure on bicycles to import Chinese bicycle parts free of anti-dumping duty.

• (3) The legal framework for operating the Exemption Scheme was provided for in Commission Regulation (EC) No 88/97 ³ (‘the Exemption Regulation’) as amended by Regulation (EU) No 512/2013 ⁴, Implementing Regulation (EU) 2015/831 ⁵ and Implementing Regulation (EU) 2020/1296 ⁶.

• (4) As provided for in recital (44) of Regulation (EC) No 71/97, the Commission keeps the exemption system constantly under review so that it can be adapted where necessary to take account of the experience acquired through the operation of that system.

• (5) The purpose of this Commission Implementing Regulation amending the Exemption Regulation is to adapt and improve the latter based on the most recent experiences and developments that occurred subsequent to the latest amendment by Implementing Regulation (EU) 2020/1296.

• (6) In order to enhance legal certainty and transparency, the definition of ‘assembler’ should be added and other formal adjustments should be introduced to streamline the wording of the Exemption Regulation and update the references to other acts of the Union to their latest version, including the TARIC structure set out in Annex III.

• (7) Moreover, Annex I listing parties under examination pursuant to Article 6 of the exemption Regulation and Annex II listing parties exempted pursuant to Article 7 of the exemption Regulation should be updated. However, at the moment of the adoption of this Regulation the parties listed under TARIC additional code 8605, A576 and C009 are subject to re-assessment of the exemption authorisation granted to them respectively. The outcome of this re-assessment will be subject to a separate legal act.

• (8) Under the Exemption Scheme, as set out in Article 5(2) of the Exemption Regulation, the competent authorities of the Member States may make the suspension of payment of the extended duty subject to the provision of a guarantee of the extended duty. However, this provision is not compulsory and from the experience acquired through the implementation of the Exemption Scheme, the Commission notes that this creates potential problems of discrimination and gaps as regards enforcement of the provisions of the Exemption Regulation.

• (9) Against this background, the Commission considers it necessary to introduce a compulsory provision of a guarantee in case a suspension is granted ensuring equal treatment and proper enforcement.

• (10) Furthermore, when the applicant withdraws the request for exemption (‘the request’), or the request is subsequently held inadmissible or rejected, the extended duty subject to suspension may not be recovered. In particular, the effects of the withdrawal of the request are not specifically regulated in the Exemption Regulation as amended. The Commission considers that the compulsory provision of the guarantee should ensure the recovery of the extended duty also in cases of subsequent inadmissibility, rejection and withdrawal of the request.

• (11) Moreover, the Commission considers it appropriate to regulate expressly the effects of the withdrawal of the request. Therefore, in case of withdrawal, the request should be considered not to have been lodged and the suspension of the payment of the extended duty should be lifted. This approach would be similar to Article 5(8) of the basic Regulation.

• (12) In conjunction therewith, the Commission further considers it appropriate to underline the provisional effects of the suspension, compared to the longer-term effects of the exemption. To this end, references to exemption should be coupled or replaced by references to suspension, where needed.

• (13) Having reviewed the experience acquired in operating the Exemption Scheme, the Commission considers it necessary to introduce certain amendments to ensure its proper functioning and enforcement.

• (14) Firstly, the Commission notes that the Exemption Regulation provides for the possibility to apply again for the Exemption Scheme after 12 months from the rejection of a request or from the revocation of the exemption. This timeframe is not long enough to align the assembly operation with the conditions to benefit from the Exemption Scheme, notably those listed in Articles 4, 5 and 8.

• (15) Therefore, the Exemption Regulation should provide for a longer timeframe of at least 36 months before an applicant can re-submit a request for exemption. Moreover, the 36-month foreclosure period should apply also in respect to requests rejected at the admissibility stage.

• (16) Furthermore, the Commission notes that it is essential to have the possibility to verify that exempted parties comply with anti-circumvention rules with respect to imports of essential bicycle parts.

• (17) Therefore, the Exemption Regulation should oblige exempted parties or parties under examination to keep record of the essential bicycle parts delivered to them, and of the use made of those parts, for a period longer than the 3 years currently provided, corresponding to at least 5 years. This timeframe would encompass the duration of anti-circumvention investigations and other proceedings in different policy areas, such as customs or anti-fraud proceedings.

• (18) With respect to enforcement, the Commission notes that, when a review of the exempted party is initiated, the exemption remains in place during the review proceedings. In case the exemption is revoked, the extended duty which has not been paid during the review cannot be recovered.

• (19) Therefore, in such a case, the Exemption Regulation should specify that the imports of essential bicycle parts of the parties under review should be subject to registration during the period the review investigation is carried out, pending the results of that review, to ensure that, should the review result in a revocation of the exemption, measures may subsequently be applied against those imports from the date of such registration.

• (20) The Commission further notes that, when an exempted party is found to be misdeclaring the Chinese origin of products, this has a direct impact on the compliance with the obligations of exempted parties, notably the obligations under Article 8 of the Exemption Regulation.

• (21) Therefore, in such instances, the Exemption Scheme should provide for the initiation of a review of the exemption granted to a party found to have misdeclared the Chinese origin of imported bicycle parts.

• (22) In addition, repeated customs misdeclarations of any bicycle parts by an exempted party should result in the revocation of the exemption.

• (23) An exemption should also be revoked when an exempted party is found to engage in practices circumventing the extended duty, inter alia, by undermining the remedial effects of the duty by importing significant quantities. Article 14(c) of the Exemption Regulation implies that the remedial effects of the duty will be undermined when 300 or more units per type of essential bicycle parts are either declared for free circulation by a party or are delivered to it.

• (24) To ensure legal certainty and transparency, this threshold should be made explicit in the Exemption Regulation.

• (25) The Commission further considers it appropriate to clarify the interpretation of the threshold established in Article 14(c). In this respect, the threshold of less than 300 units per type of essential bicycle parts on a monthly basis should refer to the monthly average of units per type of essential bicycle parts during periods of 12 months starting from the date of entry into force of the relevant end-use authorisation. In any case, the total of one or more periods cannot be longer than the validity period of the relevant end-use authorisation.

• (26) In relation to end-use authorisations granted by the relevant authorities of the Member States, the Commission notes that an exempted party which does not reach the threshold for the application of the Exemption Scheme mentioned above would still benefit from the exemption granted, despite not meeting one of the requirements for the admissibility of the request.

• (27) Therefore, the Exemption Regulation should allow for the revocation of exemptions for parties whose imports are below the threshold indicated in Article 14(c) of the Exemption Regulation.

• (28) Moreover, a party under examination can under the current rules apply for an end-use authorisation and benefit from both statuses, despite the fact that the two tools are mutually exclusive.

• (29) Therefore, the category of parties eligible for an end-use authorisation should exclude both an exempted party and a party under examination under the Exemption Scheme.

• (30) The Commission further considers it useful to recall that Regulation (EU) No 512/2013 as referred to in recital (3) clarified that bicycle parts used for the assembly of bicycles fitted with an auxiliary motor are subject neither to the anti-dumping duty nor to the extended anti-dumping duty and therefore, the assembly operations of such bicycles remain outside the scope of Regulation (EC) No 71/97 and consequently of the Exemption Regulation.

• (31) For reasons of legal certainty and in accordance with the procedures regulating implementing acts, including in trade defence proceedings, the Exemption Regulation should state that the decision concluding the review investigation should be a Commission regulation adopted in accordance with the examination procedure referred to in Article 5 of Regulation (EU) No 182/2011 of the European Parliament and of the Council ⁷.

• (32) In accordance with the principle of sound administration, the amendments to the Exemption Regulation provided for in this Regulation are to apply as soon as possible to all new and to all pending investigations.

• (33) Regulation (EC) No 88/97 should therefore be amended accordingly.

• (34) 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

Regulation (EC) No 88/97 is amended as follows:

• (1) in Article 1, the definitions of ‘extended duty’, ‘assembly operation’ and ‘exempted party’ are replaced by the following respectively:

• ‘— “extended duty” means the anti-dumping duty imposed by Regulation (EEC) No 2474/93, as extended by Article 2 of Regulation (EC) No 71/97 (hereinafter “the Reference Regulation”), and as maintained by subsequent Regulations,’

• ‘— “assembly operation” means an operation in which essential bicycle parts are brought in for the assembly or completion of bicycles or of bicycle parts,’

• ‘— “exempted party” means any party whose assembly operations have been found to fall outside the scope of Article 13(2) of Regulation (EU) 2016/1036[^ntr*1-L_2023080EN.01006701-E0008] and which has been exempted pursuant to Article 7 or 12 of this Regulation,

[^ntr*1-L_2023080EN.01006701-E0008]: 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 (OJ L 176, 30.6.2016, p. 21).’ "

• (2) the definition of ‘assembler’ is added to Article 1 as follows:

• ‘— “assembler” means any party that performs an assembly operation,’;

• (3) the definition of ‘the remedial effect of measures’ is added to Article 1 as follows:

• ‘— “the remedial effects of the duty are being undermined”, as referred to in Article 13(2)(c) of Regulation (EU) 2016/1036, in terms of quantities, means that, on a monthly basis, sales of the products resulting from the assembly operations exceed 299 bicycles or 299 units of a single type of essential bicycle parts.’;

• (4) the title of Article 2 is replaced by the following:

‘Article 2

Exemption and suspension of imports from the extended duty’;

• (5) Article 2(2) is replaced by the following:

‘2.   The payment of the extended duty on imports of essential bicycle parts shall be suspended where they are declared for free circulation by, or on behalf of, a party under examination.’;

• (6) the address indicated in Article 3(1) is replaced by the following:

• (7) Article 3(2) is replaced by the following:

‘2.   Upon receipt of a request, the Commission shall acknowledge receipt forthwith.’;

• (8) Article 4(1)(b) is replaced by the following:

• ‘(b) it provides prima facie evidence that the applicant’s assembly operations fall outside the scope of Article 13(2) of Regulation (EU) 2016/1036; and’;

• (9) Article 4(1)(c) is replaced by the following:

• ‘(c) the applicant has not, within the 36 months preceding the request, been refused authorisation of exemption pursuant to this Article or Article 7(3) or (4), or had an exemption revoked pursuant to Article 10.’;

• (10) Article 4(4) is replaced by the following:

‘4.   Where a request is held inadmissible, it shall be rejected by a Decision in accordance with the procedure referred to in Article 13(4) of Regulation (EU) 2016/1036.’;

• (11) Article 5 is replaced by the following:

‘Article 5

Suspension of payment of the duties

1. As from the date of receipt of a request that has been declared admissible pursuant to Article 4, and pending a decision on its merits pursuant to Articles 6 and 7, payment of the customs debt in respect of the extended duty pursuant to Article 2(1) of the Reference Regulation shall be suspended in respect of any imports of essential bicycle parts declared for free circulation by the party under examination. A period of not less than 6 months prior to the receipt of the request is taken into consideration in order to establish prima facie compliance with the conditions set out in Article 4(1) and (2).

1. The competent authorities of the Member States shall make the suspension of payment of the extended duty subject to the provision of a guarantee of the extended duty in accordance with Title III, chapter 2 of the Union Customs Code[^ntr*2-L_2023080EN.01006701-E0009], in the event that the request is subsequently held inadmissible pursuant to Article 4(4), withdrawn pursuant to Article 7(5), or rejected pursuant to Article 7(3) or (4).

[^ntr*2-L_2023080EN.01006701-E0009]: Regulation (EU) No 952/2013 of the European Parliament and of the Council of 9 October 2013 laying down the Union Customs Code (OJ L 269, 10.10.2013, p. 1).’;"

• (12) Article 6(2) is replaced by the following:

‘2.   Any party under examination shall ensure that, at any time, essential bicycle parts which it declares for free circulation are either used in its assembly operations, or assembly of other products, destroyed, or re-exported. It shall keep records of the essential bicycle parts delivered to it – and of the use made of them. These records shall be retained for 5 years from the date of suspension. The records and any necessary additional evidence and information shall be communicated to the Commission upon request.’;

• (13) Article 7 is replaced by the following:

‘Article 7

Decision

1. Where the facts as finally ascertained show that the applicant’s assembly operations do not fall within the scope of Article 13(2) of Regulation (EU) 2016/1036, the applicant’s exemption from the extended duty shall be authorised in accordance with the procedure referred to in Article 13(4) of Regulation (EU) 2016/1036.

1. The decision shall have retroactive effect as from the date of receipt of the duly substantiated request referred to in Article 4(1). The applicant’s customs debt pursuant to Article 2(1) of the Reference Regulation shall be considered void from that date.

1. Where the criteria for exemption are not fulfilled, the request shall be rejected in accordance with the procedure referred to in Article 13(4) of Regulation (EU) 2016/1036 and the suspension of the payment of the extended duty referred to in Article 5 shall be lifted.

1. Any breach of obligations under Article 6(2) or any false declaration relating to a decision may constitute a reason for rejecting the request.

1. Where a request for exemption is withdrawn, it shall be considered not to have been lodged and the suspension of the payment of the extended duty referred to in Article 5 shall be lifted.’;

• (14) Article 8(1)(a) is replaced by the following:

• ‘(a) its assembly operations remain outside the scope of Article 13(2) of Regulation (EU) 2016/1036;’;

• (15) Article 8(2) is replaced by the following:

‘2.   An exempted party shall keep records of the essential bicycle parts of which it receives deliveries and of the use made of them. It shall retain those records and appropriate supporting evidence for 5 years. Those records shall be made available to the Commission on request.’;

• (16) Article 9 is replaced by the following:

‘Article 9

Review

1. The Commission may on its own initiative review the situation of an exempted party to verify that it respects its obligations under Article 8, including any matters related thereto.

1. A review shall consist of an examination covering a period which may be shorter than 6 months.

1. A review shall be initiated by Commission regulation after informing Member States. As of the date of the initiation of the review, imports from the party under review shall be registered pursuant to Article 14(5) of the basic Regulation, to ensure that, should the review result in a revocation of the exemption, measures may subsequently be applied against those imports from the date of such registration.

1. If an exempted party engages in customs misdeclaration of essential bicycle parts of Chinese origin, the Commission may initiate a review within the meaning of the first paragraph.

1. Investigations shall be carried out by the Commission. The Commission may be assisted by customs authorities and the investigation shall be concluded by Commission regulation acting in accordance with the examination procedure referred to in Article 15(3) of Regulation (EU) 2016/1036.’;

• (17) Article 10 is replaced by the following:

‘Article 10

Revocation of an exemption

An exemption shall be revoked in accordance with the procedure referred to in Article 13(4) of Regulation (EU) 2016/1036, after the exempted party has been given an opportunity to comment:

— where a review has shown that the exempted party’s assembly operations fall within the scope of Article 13(2) of Regulation (EU) 2016/1036, or

— where the exempted party is not using essential bicycle parts for the assembly operations in quantities above the threshold set out in Article 14(c), including where the party has been wound up or has otherwise ceased its assembly operations, or

— at any rate, in the event of a repeated customs misdeclaration of any bicycle part, or

— in the event of a breach of the party’s obligations pursuant to Article 8, or

— in the event of a lack of cooperation after the adoption of the exemption decision.’;

• (18) Article 13 is replaced by the following:

‘Article 13

Procedural provisions

The relevant provisions of Regulation (EU) 2016/1036 concerning:

— the conduct of investigations (Article 6(2), (3), (4) and (5)),

— verification visits (Article 16),

— non-cooperation (Article 18), and

— confidentiality (Article 19),

shall apply to examinations pursuant to this Regulation.’

;

• (19) the first paragraph of Article 14 is replaced by the following:

‘Where imports of essential bicycle parts are declared for free circulation by a person other than an exempted party or a party under examination pursuant to Article 5, as from the date of entry into force of the Reference Regulation, they shall be exempted from the application of the extended duty if declared in accordance with the TARIC structure in Annex III and subject to the conditions laid down in Article 254 of the Union Customs Code, which shall be applicable mutatis mutandis, where:’;

• (20) Article 14(b) is replaced by the following:

• ‘(b) the essential bicycle parts are delivered to another holder of an authorisation for the end-use procedure within the meaning of Article 254 of the Union Customs Code; or’;

• (21) the first sentence of Article 14(c) is replaced by the following:

‘on a monthly basis, less than 300 units per type of essential bicycle parts are, on average, either declared for free circulation by a party or are delivered to it. The time limit to calculate that average will not exceed 12 months, whereby the first period starts from the date of entry into force of the concerned end-use authorisation, and will in no case exceed its period of validity.’;

• (22) Article 15(2) is replaced by the following:

‘2.   Where the parties referred to in paragraph 1 are found to have declared for free circulation or received deliveries of quantities of essential bicycle parts above the threshold set out in Article 14(c), or where they fail to cooperate with the examination, they shall no longer be presumed to fall outside the scope of Article 13(2) of Regulation (EU) 2016/1036, and any exemption authorisation granted to such parties shall be revoked retrospectively. After the party concerned has been given an opportunity to comment, those findings shall be notified to the competent authorities of the Member States.’;

• (23) in Article 15(3) the word ‘may’ is replaced by ‘shall’;

• (24) in Article 18 the word ‘Communities’ is replaced by ‘Union’;

• (25) Annexes I, II and III are replaced by Annexes I, II and III to this Regulation;

• (26) Annex IV is repealed.

Article 2

This Regulation shall enter into force on the day following that of its publication in the Official Journal of the European Union.

It shall apply to all exempted parties as of its entry into force. For the avoidance of doubt, the obligations introduced pursuant to Article 1(15) only apply to records held by previously exempted parties 24 months after the entry into force of this Regulation.

This Regulation shall be binding in its entirety and directly applicable in all Member States.

Done at Brussels, 17 March 2023.

For the Commission

The President

Ursula VON DER LESYEN

ANNEX I

Parties under examination

ANNEX II

Updated list of exempted parties

ANNEX III

TARIC structure