Commission Implementing Regulation (EU) 2023/1617 of 8 August 2023 amending Commission Implementing Regulation (EU) 2021/2011 imposing a definitive anti-dumping duty on imports of optical fibre cables originating in the People’s Republic of China

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 12 thereof,

Whereas:

(1) On 17 November 2021, the Commission adopted Implementing Regulation (EU) 2021/2011 (2) (‘the original Regulation’) imposing a definitive anti-dumping duty on imports of optical fibre cables (‘OFC’, ‘the product under investigation’) originating in the People’s Republic of China (‘China’ or ‘the country concerned’). The definitive anti-dumping duty imposed initially was ranging from 19,7 % to 44 % (‘the duty imposed initially’).

(2) The product under investigation is also subject to a definitive countervailing duty ranging from 5,1 % to 10,3 %, imposed by the Commission Implementing Regulation (EU) 2022/72 (3), as corrected by the Commission Implementing Regulation (EU) 2022/469 (4). However, the countervailing duty is not subject to this reinvestigation. Following the imposition of the definitive countervailing duty on the product under investigation, in order to avoid offsetting the effects of subsidisation twice, the definitive anti-dumping duty was reduced to a range of 14,6 % to 33,7 %.

(3) The Commission received a request for an absorption reinvestigation of the anti-dumping measures in force with respect to imports of the product under investigation, pursuant to Article 12 of the basic Regulation.

(4) The request was lodged on 28 October 2022 by Europacable (‘the applicant’) on behalf of the Union producers. The applicant represents more than 25 % of the total Union production of OFC.

(5) The applicant has submitted sufficient evidence showing that after the original investigation period, Chinese export prices have decreased and that the decrease in Chinese export prices impeded the intended remedial effects of the measures in force. The evidence contained in the request indicated that the decrease in export prices cannot be explained by a decrease of the price of the major raw material or other costs or by a change in the product mix.

(6) On 8 December 2022, the Commission reopened the anti-dumping investigation by a notice published in the Official Journal of the European Union (‘the Notice of Reopening’) (5).

(7) The reinvestigation concerned the current anti-dumping duties imposed, as set out in Article 1(2) of the original Regulation, as amended and corrected.

(8) In the Notice of Reopening, the Commission invited interested parties to contact it to participate in the reinvestigation. In addition, the Commission specifically informed the applicant, exporting producers and importers known to be concerned and the authorities of the country concerned about the reinvestigation and invited them to participate.

(9) Interested parties were given the opportunity to make their views known in writing and to request a hearing with the Commission and/or the Hearing Officer in trade proceedings.

(10) To decide whether sampling was necessary and, if so, to select a sample, the Commission asked all exporting producers in China to provide the Commission with the information requested in the Notice of Reopening. In addition, the Commission requested 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 reinvestigation.

(11) Eleven exporting producers in China provided the requested information and agreed to be included in the sample. In accordance with Article 17(1) of the basic Regulation, the Commission selected a sample of two groups of exporting producers based on the largest representative volume of exports to the Union which could reasonably be investigated within the time available. The sampled groups of exporting producers were FiberHome Telecommunication Technologies Co., Ltd. and related companies (‘the FTT Group’) and Jiangsu Zhongtian Technology Co., Ltd. and related companies (‘the ZTT Group’). The sampled exporting producers represented 58 % of the total estimated export volume of OFC from China to the Union during the absorption investigation period (from 1 October 2021 to 30 September 2022). The sample selected was identical to the sample in the investigation that led to the imposition of the duty imposed initially (‘the original investigation’).

(12) In accordance with Article 17(2) of the basic Regulation, all known exporting producers concerned, and the authorities of the country concerned were consulted on the selection of the sample. No comments were received and thus the sample was confirmed.

(13) 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 Reopening.

(14) Two companies (Cable 77 Danmark Aps and Connect Com GmbH) provided the requested information and agreed to be included in the sample. After analysing the sampling information supplied by them, the Commission decided that sampling was not necessary and asked both cooperating companies to submit their replies to the questionnaire for unrelated importers.

(15) The Commission sent questionnaires to the sampled groups of exporting producers and to the companies which provided information requested from unrelated importers. The questionnaires were also made available online on the day of the initiation (6).

(16) One of these companies, Cable 77 Danmark Aps (Denmark), an unrelated importer, submitted an incomplete questionnaire reply. The Commission sent a deficiency letter requesting additional information. However, the company did not reply. The second company, Connect Com GmbH (Germany), informed the Commission that during the absorption investigation period, it did not import the product under investigation from China but purchased it from companies located in the Union. Therefore, the Commission did not consider this company as an unrelated importer in the sense of the basic Regulation in the context of the current reinvestigation. Therefore, the Commission did not verify the information provided by these two companies and did not use this information in the present reinvestigation.

(17) The Commission sought and verified or cross-checked all the information deemed necessary for the purpose of this reinvestigation provided by the sampled exporting producers. In view of the outbreak of COVID-19, the Commission could not carry out verification visits pursuant to Article 16 of the basic Regulation at the premises of FiberHome Telecommunication Technologies Co., Ltd and Nanjing Wasin Fujikura Optical Communication Ltd. (both belonging to the FTT Group) as well as at the premises of Jiangsu Zhongtian Technology Co., Ltd., Zhongtian Power Optical Cable Co., Ltd., ZTT International Limited and ZTT Europe GmbH (all belonging to the ZTT Group). Instead, the Commission cross-checked remotely via videoconference the information provided by these companies, in line with its Notice on the consequences of the COVID-19 outbreak on anti-dumping and anti-subsidy investigations (7).

(19) The absorption investigation period (‘AIP’) was from 1 October 2021 to 30 September 2022. The original investigation period (‘OIP’) was from 1 July 2019 to 30 June 2020.

(20) The Commission received comments on the request and the initiation from Connect Com GmbH (‘Connect Com’), an unrelated importer that cooperated in the original investigation.

(21) Connect Com claimed that the use of average price per cable-km was not a meaningful indicator to check whether the anti-dumping duties have been absorbed because cables with high number of fibres were more expensive per cable-km than cables with low number of fibres. Connect Com argued that the fall of average price per cable-km was caused by the change of product mix sold before and after the imposition of anti-dumping duties.

(22) The Commission recalled that the applicant relied on import prices from the TARIC database of Eurostat for the product under investigation, which is the usual practice because the statistical data is gathered based on the product description as a whole, rather than individual product types. The Commission considered it sufficient to reopen the reinvestigation on this basis. Furthermore, it was noted that Connect Com did not submit any evidence showing that the decrease in import price was due to a change in product mix. During the reinvestigation, the Commission collected more detailed data at product type level based on product control numbers (‘PCNs’) and was able to compare prices of the same product types as explained in recital (40). The claim was therefore rejected.

(23) Connect Com also stated that the unit of measurement ‘kg’ or ‘tonnes’ was not common in the cable business. The usual units of measurement for cables were meters or kilometres.

(24) The Commission observed that, like for all other products in the TARIC database of Eurostat, import volumes of the product under investigation are also available in tonnes/kg, in addition to cable-km. The applicant’s request indicated the (relevant) import volumes in both units with the relevant price per each unit. The claim was therefore rejected.

(25) Connect Com claimed that the consideration of prices only until the end of the first half of 2022, as indicated in the request, led to a distorted result because the prices rose again in June 2022 and were expected to continue to rise in the second half of 2022.

(26) The Commission recalled that, given the lodging date of the request, the period used in the request to show trends ending on 30 June 2022 was the most recent period with a full set of data available to the applicants at the time of the request. In addition, during the reinvestigation the Commission assessed prices until the end of the AIP, i.e., 30 September 2022. It follows that the period during which, according to Connect Com, the prices rose was partially included in the AIP. Therefore, the claim was rejected.

(27) Connect Com also disputed the causality between the allegedly fallen prices and the imposition of the duties. It claimed that an extreme price decrease already occurred from August 2021 to September 2021, before the duties were imposed and that the subsequent price drop from EUR 10 in December 2021 to EUR 7 in June 2022 was not significant anymore and not linked to the imposition of the measures.

(28) According to Article 12 of the basic Regulation, when there is sufficient evidence of duties being absorbed, the original investigation might be re-opened at the request of any interested party. The Commission assessed the evidence submitted by the applicant showing that after the original investigation period, Chinese export prices had decreased. In view of this information, the Commission decided to open the absorption reinvestigation. Furthermore, Article 12(2) of the basic Regulation does allow the Commission to consider evidence of price decreases occurring after the OIP and before the imposition of duties, such as the ones discussed by Connect Com. The claim put forward by Connect Com was therefore rejected.

(29) On 1 June 2023, the Commission disclosed the essential facts and considerations on the basis of which it intended to amend the definitive anti-dumping duty on imports of OFC originating in China. All parties were granted a period within which they could make comments on the disclosure. The Commission received comments from FTT Group, ZTT Group and Twentsche (Nanjing) Fibre Optics Ltd (‘TFO’).

(30) TFO, a non-sampled cooperating exporting producer, claimed that its request for individual examination was ignored. Furthermore, TFO claimed that it was 100 % owned by the Dutch company TKH Group NV and that it sells OFC under normal condition of competition to its subsidiary in the Union. They also claimed that the pricing did not change between the OIP and the AIP. They finally disagreed with the Commission assessment regarding the dumping duty applicable to them as a result of the anti-absorption investigation.

(31) The Commission notes that TFO applied for individual examination in the original investigation. During the original investigation, its request for individual examination was rejected as explained in recital (40) of the original Regulation. Therefore, the duty applicable to TFO was the duty of the cooperating non-sampled companies as explained in recitals (397) and (565) of the original Regulation. In the current investigation, the Commission calculated the dumping margin of the cooperating non-sampled companies during the AIP as explained in recital (85) of this Regulation. The duty applicable to the cooperating non-sampled companies of the original investigation was increased as explained in recital (99) of this Regulation.

(32) Regarding the shareholding of TFO, the Commission noted that TFO is an exporting producer based in China which exports to the Union and is subject to the anti-dumping duty for cooperating non-sampled companies. The fact that TFO is owned by another company established in the Union has no bearing on this finding or the applicability of the relevant duty rate. Therefore, these claims were rejected.

(33) Following final disclosure, interested parties were granted an opportunity to be heard. No hearings were requested.

(34) On 26 June 2023, the Commission provided interested parties with an additional final disclosure on the basis of which it intended to amend the definitive anti-dumping duty on imports of OFC originating in China. All parties were granted a period within which they could make comments on the additional disclosure. The Commission received comments from the FTT Group and the ZTT Group.

(35) The product under investigation is single mode optical fibre cables, made up of one or more individually sheathed fibres, with protective casing, whether containing electric conductors, originating in China, currently falling under CN code ex 8544 70 00 (TARIC code 8544700010).

(37) The optical fibre cables are used as an optical transmission medium in telecommunication networks in long haul, metro, and access networks.

(38) The absorption reinvestigation pursuant to Article 12 of the basic Regulation aims at establishing whether export prices have decreased or whether there has been no movement, or insufficient movement, in resale prices or subsequent selling prices in the Union of the product under investigation after the OIP. As a second step, if it is concluded that the measure should have led to movements in such prices, then, to remove the injury previously established in accordance with Article 3 of the basic Regulation, export prices shall be reassessed in accordance with Article 2 of the basic Regulation and dumping margins shall be recalculated to take account of the reassessed export prices.

(39) To determine whether export prices have decreased, the Commission first established for each sampled exporting producer its cost, insurance, and freight (‘CIF’) export prices at the Union customs border during the AIP and compared these prices to the corresponding CIF export prices determined during the original investigation for the OIP.

(40) The Commission then compared for each sampled exporting producer the prices of the product types sold in the AIP with the prices of the same product types sold in the OIP and calculated for them the weighted average price difference. Not all product types sold in the AIP were also sold in the OIP. To ensure sufficient comparability level, the Commission compared the prices of the most sold ‘unmatched’ product types in the AIP with the prices of the most closely resembling product types sold in the OIP, where available.

(41) The above comparison made for the two sampled groups of exporting producers resulted in the weighted average export price decrease of 50,5 % for the FTT Group and the weighted average export price decrease of 13,2 % for the ZTT Group.

(42) Regarding the claim made by Connect Com as stated in recital (21), the investigation revealed that one sampled group of exporting producers exported the same PCNs in the AIP as in the OIP, while the other sampled exporting producer sold also other PCNs in the AIP as compared to OIP. The investigation revealed that the prices decreased for the matching PCNs. Therefore, the claim was rejected.

(43) Since there was a fall in export prices, as required under Article 12(2) of the basic Regulation, the Commission recalculated dumping margins of the sampled exporting producers, in accordance with Article 2 of the basic Regulation.

(44) The ZTT Group submitted that ZTT Europe GmbH (‘ZTT Europe’), its related importer in the Union, purchased all product under investigation resold during the AIP before the imposition of the anti-dumping duty (that is all ZTT Europe’s resales of the product under investigation during the AIP were free from anti-dumping duty) and therefore the Commission should disregard ZTT Europe’s sales from its assessment in this reinvestigation.

(45) The Commission observed that according to Article 12(2) of the basic Regulation it should assess the change of prices which had occurred after the OIP and prior to or following the imposition of measures. Therefore, the claim was rejected, except for sales made by ZTT Europe of the product under investigation purchased before or during the OIP, which the Commission indeed disregarded in its assessment.

(46) Connect Com stated that no comprehensible justification was given as to why individual importers should have reported their imports in fibre-km instead of cable-km.

(47) In the questionnaires the Commission requested both the exporting producers and the importers to report the data in cable-km and fibre-km as it was requested in the original investigation. However, all the calculations have been carried out in cable-km.

(48) In their comments on the final disclosure, ZTT Group claimed that when determining whether the export prices have decreased, the Commission should only take into consideration those product types that were also sold in the OIP. ZTT Group argued that the Commission’s methodology to compare the price level of most closely resembling product types would be distortive as a minor change in the technical specifications of the PCN structure could lead to considerable cost and price variances.

(49) The Commission considered it more appropriate to establish export price comparisons for the majority of the product types sold during the AIP, to give a more accurate picture of price developments between the OIP and the AIP. The Commission noted, however, that even if the comparison would have been based only on the matching PCNs, there would still be a price decrease of 20,6 %. This claim was therefore rejected.