Commission Implementing Regulation (EU) 2025/78 of 15 January 2025 imposing a provisional anti-dumping duty on imports of multilayered wood flooring 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), and in particular Article 7 thereof,

After consulting the Member States,

Whereas:

(1) On 16 May 2024, the European Commission (‘the Commission’) initiated an anti-dumping investigation with regard to imports of multilayered wood flooring (‘MWF’) originating in the People’s Republic of China (‘the country concerned’, ‘the PRC’, or ‘China’) on the basis of Article 5 of Regulation (EU) 2016/1036 of the European Parliament and of the Council (‘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 4 April 2024 by the European Parquet Federation (‘the complainant’). The complaint was made on behalf of the Union industry of MWF in the sense of Article 5(4) of the basic Regulation. The complaint contained evidence of dumping and of resulting material injury that was sufficient to justify the initiation of the investigation.

(3) The Commission made imports of the product concerned subject to registration by Commission Implementing Regulation (EU) 2024/2733 of 24 October 2024 (‘the registration Regulation’) (3).

(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, other known Union producers, the known exporting producers and the authorities in the country concerned, known importers, users and traders about the initiation of the investigation and invited them to participate.

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

(6) In the Notice of Initiation, the Commission stated that it might sample the interested parties in accordance with Article 17 of the basic Regulation.

(7) In its Notice of Initiation, the Commission stated that it had provisionally selected a sample of Union producers. The Commission selected the sample on the basis of production and sales quantities in the context of the pre-initiation standing analysis. This sample consisted of three Union producers. The sampled Union producers accounted for more than 20% of the estimated total Union production and more than 20% of the estimated total Union sales of the like product. The sample was considered representative of the Union industry. The Commission invited interested parties to comment on the provisional sample. No comments were received and therefore, the sample was confirmed.

(8) 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.

(9) Two unrelated importers (Lamett Europe N.V. and Svartes s.r.o) provided the requested information and agreed to be included in the sample. In view of the low number of replies, the Commission decided that sampling was not necessary. The Commission invited the two companies indicated above to complete the questionnaire for importers. Ultimately, only Lamett Europe N.V. provided a questionnaire reply as explained in recital (17).

(10) To decide whether sampling is necessary and, if so, to select a sample, the Commission asked all exporting producers in 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 exporting producers, if any, that could be interested in participating in the investigation.

(11) 78 exporting producers in the country concerned 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 five producers from two groups on the basis of the largest representative volume of exports to the Union which could reasonably be investigated within the time available. 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. Following the consultation comments were received on the selection of that sample from one group of exporting producers. The group argued that the proposed sample was not sufficiently representative, within the meanings of Article 17(1) of the basic Regulation as it accounted only for a limited proportion of the volume exported by all cooperating exporting producers. The Commission assessed the claim and decided to extend the number of companies selected for the sample by adding third largest exporting producer’s group with five producers. The revised sample accounted for 40% of the volume and 27% of the estimated total export quantity reported by all cooperating exporting producers exported to the European Union of the product concerned during the investigation period. No further comments on the proposed sample were received.

(12) Furthermore, in the course of investigation, based on the publicly available sources the Commission verified information provided by the cooperating exporters to confirm the status of the companies as a producer of the product concerned. If necessary, the Commission requested additional documents, such as business licence and articles of association. One party failed to demonstrate link with the investigation and therefore was considered as non-cooperating.

(13) 19 exporting producers in PRC requested individual examination under Article 17(3) of the basic Regulation. However, none of them provided the questionnaire reply within the deadline set by the Commission. Accordingly, the Commission provisionally concludes that no individual examination will be granted in the present case.

(14) 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’).

(15) Furthermore, the complainant provided in the complaint sufficient prima facie evidence of raw material distortions in PRC regarding the product concerned. Therefore, as announced in the Notice of Initiation, the investigation covered those raw material distortions to determine whether to apply the provisions of Article 7(2a) and 7(2b) of the basic Regulation with regard to PRC. For this reason, the Commission sent additional questionnaires in this regard to the GOC.

(16) No questionnaire replies were received from the GOC. Consequently, the Commission informed the GOC that it intends to apply Article 18 of the basic Regulation and use the facts available as regards the existence of significant distortions in the PRC within the meaning of Article 2(6a)(b) of the basic Regulation. No further comments were received from the GOC.

(17) The questionnaires for Union producers, unrelated importers, users and exporting producers were made available online (4) on the day of initiation. The Commission received questionnaire replies from the three sampled Union producers, one unrelated importer (Lamett Europe N.V.) and three exporting producers’ groups (Jinfa Group, Forest Group and Fusong Group).

(19) The investigation of dumping and injury covered the period from 1 January 2023 to 31 December 2023 (‘the investigation period’). The examination of trends relevant for the assessment of injury covered the period from 1 January 2020 to the end of the investigation period (‘the period considered’).

(21) AUMI and CNFPIA argued that the complaint relied on import quantities in square meters from Eurostat which had been adjusted by the complainant. AUMI and CNFPIA further argued that the complainant had neither explained the need for the adjustment, nor it disclosed the adjustment method. AUMI and CNFPIA noted that using the adjusted import quantities proposed by the complainant resulted in an increase of more than 20% of the import quantities from China during the period concerned. AUMI and CNFPIA added that using the import quantities as reported by Eurostat, that is, without any adjustment, would result in a decrease of 3% of the import quantities from China during the period concerned. Furthermore, AUMI and CNFPIA indicated that the adjusted import quantities skewed other economic indicators such as Chinese import prices, consumption and market shares.

(22) In this regard FEP indicated that while the surface density range of MWF was between 7 and 9,5 kilograms (‘kg’) per square meter (‘m2’), several Eurostat entries were outside this surface density range. FEP explained that economic operators must report the net mass (tonnes or kilograms) to customs’ authorities, but not necessarily the supplementary unit (m2). Therefore, FEP adjusted the entries outside the range by dividing their declared net mass by the average density of the above-mentioned range. FEP also updated the respective part of the non-confidential version of the complaint to illustrate the adjustment method.

(23) The Commission also analysed the issue during the investigation and addressed it under section 4.4.

(24) AUMI argued that the complaint did not include figures for five out of the 15 injury indicators, in particular the return on investment, factors affecting Union prices, actual and potential negative effects on cash flow, wages and growth.

(25) The Commission noted that it was not compulsory to include the above-mentioned indicators at the stage of the complaint. The Commission examined these indicators during the investigation in section 4. Therefore, the claim was rejected.

(26) AUMI and CNFPIA argued that the complaint did not include reliable information to support the claim that the Union industry was suffering material injury. On macro-indicators, AUMI and CNFPIA claimed that the production volumes, capacity utilization, sales, and employment within the Union were stable from 2020 to 2022 and only declined in the investigation period as a result of the decrease in demand in the Union. Furthermore, AUMI and CNFPIA indicated that Union producers increased their market share and prices during the investigation period in the complaint showing that Union producers had a robust economic health. On micro-indicators, AUMI and CNFPIA stated that production, sales, and employment data for the Complainants only worsened during the investigation period. Furthermore, AUMI and CNFPIA submitted that Union producers had increased their investments by 56% over the period covered by the complaint, which was evidence of their financial robustness. AUMI and CNFPIA indicated that during the investigation period, Chinese exporting producers seem to have adapted better to declining Union demand: while Chinese imports had decreased, stocks levels of Union producers increased. On financial performance, AUMI and CNFPIA noted that Union producers appear to have improved both sales and profitability between 2020 and 2022 despite the increase in Chinese imports during that period. Finally, AUMI also argued that Chinese imports increased by 21% during the period covered by the complaint, while at least one Union producer undercut the price of unrelated importers and still made profits.

(27) As a preliminary comment, the Commission recalled that a prima facie finding of material injury requires an examination, inter alia, of the relevant factors as described in Article 5(2) (d) of the basic Regulation. Indeed, the wording of Article 5(2) of the basic Regulation states that the complaint shall contain the information on changes in the volume of the allegedly dumped imports, the effect of those imports on prices of the like product on the Union market and the consequent impact of the imports on the Union industry, as demonstrated by relevant (not necessarily all) factors and indices having a bearing on the state of the Union industry, such as those listed in Articles 3(3) and 3(5) of the basic Regulation. Furthermore, Article 3(5) of the basic Regulation states that the list is not exhaustive, nor can any one or more of these factors necessarily give decisive guidance. Therefore, not all factors must show deterioration in order for a prima facie finding of material injury to be established. Furthermore, the existence of other factors which may have an impact on the situation of the Union industry does not necessarily imply that the effect of dumped imports on this industry is not material.

(28) The specific injury analysis of the complaint performed by the Commission showed that there was sufficient evidence pointing to increased penetration of the Union market (both in absolute and relative terms) by imports from China at prices which undercut and undersell the Union industry’s own prices. This appears to have had a materially injurious impact on the state of the Union industry, shown for example by the decrease in production, sales and market share, by a deterioration of financial results or by the level of prices charged by the Union industry. As regards the claims on specific macro-indicators, micro-indicators and price undercutting, in section 4 the Commission provided the detailed assessment on material injury during the period considered. Therefore, the claim was rejected.

(29) The product under investigation is assembled flooring panels, multilayer, of wood, currently falling under CN code 4418 75 00 (‘the product under investigation). Panels of bamboo or with at least the top layer (wear layer) of bamboo, and panels for mosaic floors are excluded.

(30) MWF is a wood-based manufactured product comprised of several layers of wood veneers which are glued or bonded together. MWF is mainly used for indoor flooring.

(31) The product concerned is the product under investigation originating in the PRC (‘the product concerned’)

(33) The Commission decided at this stage that those products are therefore like products within the meaning of Article 1(4) of the basic Regulation.

(34) In view of the sufficient evidence available at the initiation of the investigation pointing to the existence of significant distortions within the meaning of point (b) of Article 2(6a) of the basic Regulation with regard to the PRC, the Commission considered it appropriate to initiate the investigation with regard to the exporting producers from this country having regard to Article 2(6a) of the basic Regulation.

(35) Consequently, in order to collect the necessary data for the eventual application of Article 2(6a) of the basic Regulation, in the Notice of Initiation the Commission invited all exporting producers in the PRC to provide information regarding the inputs used for producing MWF. 73 exporting producers submitted the relevant information.

(36) In order to obtain information it deemed necessary for its investigation with regard to the alleged significant distortions, the Commission sent a questionnaire to the GOC. In addition, in point 5.3.2 of the Notice of Initiation, the Commission invited all interested parties to make their views known, submit information and provide supporting evidence regarding the application of Article 2(6a) of the basic Regulation within 37 days of the date of publication of the Notice of Initiation in the Official Journal of the European Union. No questionnaire reply was received from the GOC and no submission on the application of Article 2(6a) of the basic Regulation was received within the deadline. Subsequently, the Commission informed the GOC that it would use facts available within the meaning of Article 18 of the basic Regulation for the determination of the existence of the significant distortions in the PRC.

(37) In point 5.3.2 of the Notice of Initiation the Commission also specified that, in view of the evidence available, it had provisionally selected Türkiye as an appropriate representative country pursuant to Article 2(6a)(a) of the basic Regulation for the purpose of determining the normal value based on undistorted prices or benchmarks. The Commission further stated that it would examine other possibly appropriate representative countries in accordance with the criteria set out in 2(6a)(a) first indent of the basic Regulation.

(38) On 23 August 2024, the Commission informed interested parties by a note (‘the Note’) on the relevant sources it intended to use for the determination of the normal value. In that Note, the Commission provided a list of all factors of production such as raw materials, labour and energy used in the production of MWF. In addition, based on the criteria guiding the choice of an appropriate representative country pursuant to Article 2(6a)(a) of the basic Regulation and the availability of relevant financial information, the Commission identified three possible representative countries, namely Türkiye, Indonesia and Malaysia. Based on the information that was available to the Commission at the time, it considered that that Türkiye could be an appropriate representative country. The Commission received two submissions with comments on the Note jointly from two groups of exporting producers, namely the JINFA group and the Fusong Jinlong Group. The European Parquet Federation (complainant) also submitted comments. The comments are addressed in detail in section 3.2.

(39) After having analysed the comments and information received, the Commission concluded that Türkiye was an appropriate representative country from which undistorted prices and costs would be sourced for the determination of the normal value.

(40) According to Article 2(1) of the basic Regulation, ‘the normal value shall normally be based on the prices paid or payable, in the ordinary course of trade, by independent customers in the exporting country’.

(41) However, according to Article 2(6a)(a) of the basic Regulation, ‘in case it is determined […] that it is not appropriate to use domestic prices and costs in the exporting country due to the existence in that country of significant distortions within the meaning of point (b), the normal value shall be constructed exclusively on the basis of costs of production and sale reflecting undistorted prices or benchmarks’, and ‘shall include an undistorted and reasonable amount of administrative, selling and general costs and for profits’ (‘administrative, selling and general costs’ is refereed hereinafter as ‘SG&A’).

(42) As further explained below, the Commission concluded in the present investigation that, based on the evidence available, and in view of the lack of cooperation of the GOC and the exporting producers, the application of Article 2(6a) of the basic Regulation was appropriate.

(44) As the list in Article 2(6a)(b) of the basic Regulation is non-cumulative, not all the elements need to be given for a finding of significant distortions. Moreover, the same factual circumstances may be used to demonstrate the existence of one or more of the elements of the list.