Commission Implementing Regulation (EU) 2025/291 of 13 February 2025 imposing a provisional anti-dumping duty on imports of decor paper originating in the People’s Republic of China

• (138) As to the parties’ arguments on compatibility with WTO law, the Commission recalled that in anti-dumping proceedings concerning products from China, the parts of Section 15 of China’s Accession Protocol to the WTO that have not expired, continue to apply when determining normal value, both with respect to the market economy standard and with respect to the use of a methodology that is not based on a strict comparison with Chinese prices or costs.

• (139) As to the parties’ reference to DS473, the Commission recalled that the Report of Appellate Body in DS473 did not concern the implementation of Article 2(6a) of the basic Regulation, but of a particular stipulation within Article 2(5) of the basic Regulation. Nevertheless, WTO law, as interpreted by the Appellate Body in DS473, permits the use of data from a third country, duly adjusted when such adjustment is necessary and substantiated. Indeed, the existence of significant distortions renders costs and prices in the exporting country inappropriate for the construction of normal value. Therefore, the parties’ arguments could not be accepted.

• (140) Concerning the parties’ arguments on sufficiency of evidence to demonstrate the existence of significant distortions, the Commission recalled at the outset that according to Article 2(6a)(e) of the basic Regulation, if the Commission deems the evidence submitted by the complainants on the significant distortions sufficient, it can initiate the investigation on this basis. The Commission pointed out in this context that, as confirmed by the General Court in Viraj Profiles, the quantity and quality of the evidence necessary to meet the criteria of the sufficiency of the evidence for the purpose of initiating an investigation is different from that which is necessary for the purpose of a preliminary or final determination of the existence of dumping, injury or of a causal link ¹⁰⁶. Hence, the complaint met the standards set in Article 5(9) of the basic Regulation, in combination with Article 2(6a)(d). Indeed, as indicated in the Notice of Initiation ¹⁰⁷, the Commission considered at the initiation stage that there was sufficient evidence pursuant to Article 5(9) of the basic Regulation tending to show that, due to significant distortions affecting prices and costs, the use of domestic prices and costs in the PRC would be inappropriate, thus warranting the initiation of an investigation on the basis of Article 2(6a) of the basic Regulation.

• (141) The Commission therefore proceeded to prove such distortions. In order to do so, the Commission has, in line with Article 2(6a)(e) of the basic Regulation, collected the data necessary to determine the existence and impact of significant distortions and the consequent use of the methodology prescribed by Article 2(6a)(a) of the basic Regulation. The data collected by the Commission and the resulting conclusions, whether on presence of state-owned companies in the sector of the product concerned or the links to the CCP are presented in Section 6.3 of this Regulation. Therefore, the parties’ arguments on the evidence contained in the complaint could not be accepted.

3.2.1.10.   Conclusion

• (142) The analysis set out in this section, which includes an examination of all the available evidence relating to China’s intervention in its economy in general as well as in the sector of the product concerned showed that prices and costs of the product concerned, including the costs of raw materials and inputs, energy and labour, are not the result of free market forces because they are affected by substantial government intervention within the meaning of Article 2(6a)(b) of the basic Regulation as shown by the actual or potential impact of one or more of the relevant elements listed therein.

• (143) On that basis, the Commission concluded that it is not appropriate to use domestic prices and costs to establish normal value in this case.

• (144) Consequently, the Commission proceeded to construct the normal value exclusively on the basis of costs of production and sale reflecting undistorted prices or benchmarks, that is, in this case, on the basis of corresponding costs of production and sale in an appropriate representative country, in accordance with Article 2(6a)(a) of the basic Regulation, as discussed in the following section.

3.2.2.   Representative country

3.2.2.1.   General remarks

• (145) The choice of the representative country was based on the following criteria pursuant to Article 2(6a) of the basic Regulation:

• — A level of economic development similar to the PRC. For this purpose, the Commission used countries with a gross national income per capita similar to the PRC on the basis of the database of the World Bank ¹⁰⁸;

• — Production of the product under investigation in that country;

• — Existence of readily available data in the representative country.

• — Where there is more than one possible representative country, preference was given, where appropriate, to the country with an adequate level of social and environmental protection.

• (146) As explained in recitals (36) to (38), the Commission issued two notes for the file on the sources for the determination of the normal value: the First Note on factors of production dated 2 October 2024 (the ‘First Note’) and the Second Note on the factors of production dated 6 December 2024 (the ‘Second Note’).

• (147) These notes described the facts and evidence underlying the relevant criteria, and also addressed the comments received by the parties on these elements and on the relevant sources.

• (148) In the Second Note on factors of production, the Commission informed interested parties of its intention to consider Thailand as an appropriate representative country in the present case if the existence of significant distortions pursuant to Article 2(6a) of the basic Regulation would be confirmed.

A level of economic development similar to the PRC

• (149) In the First Note on factors of production, the Commission identified Thailand, Brazil, Indonesia and Türkiye as countries with a similar level of economic development as the PRC according to the World Bank, i.e. they are all classified by the World Bank as ‘upper-middle income’ countries on a gross national income basis where production of the product under investigation was known to take place.

• (150) No comments were received concerning the countries identified in that note.

Existence of relevant readily available data in the representative country

• (151) In the Second Note, the Commission indicated that for the countries identified as countries where product under investigation is being produced, i.e. Thailand, Brazil, Indonesia and Türkiye, the availability of readily available data needed to be further verified in particular with regard to the readily available financial data from producers of the product under investigation.

• (152) The Commission looked at the presence of producers of decor paper in each of the four potential representative countries and searched for readily available financial data of companies producing the product under investigation. The Commission could not identify such companies in the four potential representative countries.

• (153) The Commission then looked at producers of a product in the same general category of the product under investigation in each of the four potential representative countries, that also includes specialty paper (mainly flexible packaging and labels) and printing paper. No company was identified in this category with readily available financial data. The complainants identified in the complaint a Thai company (Thai Paper Mill) in this category and provided documents, allegedly for their financial data of 2022. However, the referenced period did not include any part of the IP, and the data was an unofficial excel extraction from a database ¹⁰⁹. Hence, the Commission was unable to confirm the financial data from any readily available source.

• (154) The Commission then looked at other products in the same general category as the product under investigation (‘paper and packaging producers’) ¹¹⁰, as packaging is also mentioned in the description of the four concerned HS codes ¹¹¹, which excludes wood pulp, which is an upstream product/raw material completely different in nature from the product concerned. The Commission identified readily available financial data in Orbis for the Thai producers, namely: SIAM KRAFT INDUSTRY CO LTD; DOUBLE A (1991) PUBLIC COMPANY; THAI CONTAINERS GROUP CO LTD and SIG COMBIBLOC CO LTD. also mentioned below in Section 3, which showed profitability for 2023 Thailand was the only possible representative country, for which readily available financial data of paper and packaging producers was found. For the other potential representative countries, the Commission found in Orbis information concerning some companies which were either loss-making in the financial year 2023 or companies with no available financial data for the investigation period.

• (155) No comments were received within the deadline. One party, KINGDECOR, submitted comments after the deadline which will be treated at the definitive stage.

Level of social and environmental protection

• (156) Having established that Thailand may be considered as an appropriate representative country based on all the above elements,, there was no need to assess the level of social and environmental protection in accordance with the last sentence of Article 2(6a)(a) first indent of the basic Regulation.

3.2.2.2.   Conclusion

• (157) In view of the above analysis, Thailand met the criteria laid down in Article 2(6a)(a), first indent of the basic Regulation in order to be considered as an appropriate representative country.

3.2.3.   Sources used to establish undistorted costs

• (158) In the First Note, the Commission listed the factors of production such as materials, energy and labour used in the production of the product under investigation by the exporting producers and invited the interested parties to comment and propose publicly available information on undistorted values for each of the factors of production mentioned in that note.

• (159) Subsequently, in the Second Note, the Commission stated that, in order to construct the normal value in accordance with Article 2(6a)(a) of the basic Regulation, it would use Global Trade Atlas (‘GTA’) ¹¹² to establish the undistorted cost of most of the factors of production, notably the raw materials. In addition, the Commission stated that it would use the statistics published by National Statistical Office through the Bank of Thailand ¹¹³, OECD library ¹¹⁴ and the publication ‘Cost of Doing Business in Thailand 2023’ ¹¹⁵. for establishing undistorted costs of labour and the electricity price statistics published by the Metropolitan Electricity Authority Thailand ¹¹⁶ for electricity.

• (160) The Commission explained in the Second Note its intention to calculate the price of steam in Thailand using, as basis, the methodology suggested by the U.S. Department for Energy ¹¹⁷. This methodology provides a cost for steam based on the heat input required to produce it by natural gas. To this end, the Commission intended to use the natural gas as heat input and, thus, the price of natural gas in Thailand as published by the Thai Ministry of Energy ¹¹⁸. Since this methodology calculates only the fuel cost of steam, the Commission would adjust this cost for water, consumables, other costs, SG&A and profit.

• (161) In the Second Note, the Commission also informed the interested parties that gas, compressed air and water, all together account for less than 0,3 % of the total production cost, thus, would be merged into consumables. Further, the Commission informed that it would calculate the percentage of the consumables on the total cost of inputs and apply this percentage to the recalculated cost of raw materials when using the established undistorted benchmarks in the appropriate representative country

• (162) The total of the factors of production that were merged into consumables, accounted for around 3 % of the total production cost, and thus finally, about 4 % of the total production cost is accounted as consumables.

3.2.4.   Undistorted costs and benchmarks

3.2.4.1.   Factors of production

• (163) Considering all the information submitted by the interested parties and collected during the verification visits, the following factors of production and their sources have been identified in order to determine the normal value in accordance with Article 2(6a)(a) of the basic Regulation:

Table 1

Factors of production of decor paper

Factors of Production	Commodity Code	Source of data the Commission intends to use	Unit of measurement	Unit cost CNY/unit
Raw materials	Raw materials	Raw materials	Raw materials
Wood Pulp – non-coniferous	470329	Global Trade Atlas (GTA)	Kg	4,66
Wood Pulp – coniferous	470321	Global Trade Atlas (GTA)	Kg	6,11
Titanium dioxide	32061110 32061190	Global Trade Atlas (GTA)	Kg	24,94
Kaolin	250700000020	Global Trade Atlas (GTA)	Kg	2,83
Wet strength agent / Polyamide Epichlorohydrin Resin (PAE)/Retention aid	380992	Global Trade Atlas (GTA)	Kg	7,30
Silicate double salt/Sodium alumina silicate	284210	Global Trade Atlas (GTA)	Kg	25,39
Iron series pigments / Iron oxide pigments (yellow-black-red-brown)	282110000010	Global Trade Atlas (GTA)	Kg	10,74
Talcum powder	25262010 252620900010 252620900020	Consumables	Consumables	—
Organic ink / pigments / Color paste	32041710 32041790	Consumables	Consumables	—
Defoamer / Detergent	380992	Consumables	Consumables	—
Starch	1108	Consumables	Consumables	—
Latex	4002 11	Consumables	Consumables	—
Diatomite	251200	Consumables	Consumables	—
White carbon black	281122	Consumables	Consumables	—
Sodium hypochlorite	282890	Consumables	Consumables	—
Liquid caustic soda	281512	Consumables	Consumables	—
Aluminium sulphate	283322	Consumables	Consumables	—
Bactericide	380892	Consumables	Consumables	—
Bentonite	250810	Consumables	Consumables	—
Sodium hydroxide	281511	Consumables	Consumables	—
Sodium Carbonate	283620	Consumables	Consumables	—
Scrap/Recycled paper	—	Consumables	Consumables	—
By-products	By-products	By-products	By-products
Scrap/Recycled paper	—	Consumables	Consumables	—
Energy	Energy	Energy	Energy
Energy – Electricity	—	Metropolitan Electricity Authority Thailand	kWh	0,91
Energy – Gas	—	Consumables	Consumables	—
Energy – water	—	Consumables	Consumables	—
Energy – steam	—	Ministry of Energy Thailand	MT	228,35
Energy – Compressed air	—	Consumables	Consumables	—
Labour	Labour	Labour	Labour
Labour	—	National Statistical Office and Bank of Thailand	manhour	20,32

• (164) The Commission included a value for manufacturing overhead costs in order to cover costs not included in the factors of production referred to above. The methodology is duly explained under section Manufacturing overhead costs, SG&A, profits and depreciation below.

Raw materials and inputs

• (165) In order to establish the undistorted price of raw materials as delivered at the gate of a representative country producer, the Commission used as a basis the weighted average import price (CIF) to the representative country as reported in the GTA to which import duties and transport costs were added.

• (166) As regards wood pulp (eucalyptus), a type of wood not common in China or nearby countries, which is the second most important raw material for the production of decor paper, the two Chinese producers proved during the verification that they only buy from non-Chinese sources from unrelated suppliers. This means that their import prices were accepted and not replaced.

• (167) Concerning the main raw material, titanium dioxide, KINGDECOR claimed and proved during the verification that it imported a limited amount of its titanium dioxide from unrelated suppliers, outside China. This concerned qualities unavailable in China. For this part of titanium dioxide, its imports prices were accepted and not replaced.

• (168) For all other raw materials, an import price in the representative country was determined as a weighted average of unit prices of imports from all third countries excluding the PRC and countries which are not members of the WTO, listed in Annex 1 to Regulation (EU) 2015/755 of the European Parliament and the Council ¹¹⁹.

• (169) The Commission decided to exclude imports from the PRC into the representative country as it concluded in Section 3.2 that it is not appropriate to use domestic prices and costs in the PRC due to the existence of significant distortions in accordance with Article 2(6a)(b) of the basic Regulation. Given that there is no evidence showing that the same distortions do not equally affect products intended for export, the Commission considered that the same distortions affected export prices. The remaining volumes were considered to be representative.

Labour

• (170) The Commission used the latest available statistics of National Statistical Office through the Bank of Thailand, OECD library and the publication ‘Cost of Doing Business in Thailand 2023’, indexed to the IP, using the average labour cost in the manufacturing sector of Thailand ¹²⁰.

Electricity

• (171) The price of electricity for companies (industrial users) in Thailand is published by the Metropolitan Electricity Authority Thailand ¹²¹. The Commission used the data on the industrial electricity prices in the corresponding consumption band in THB/kWh as published periodically for every month of the IP.

Steam

• (172) As described in section 3.2.3, the Commission calculated the price of steam in Thailand using, as basis, the methodology suggested by the U.S. Department for Energy ¹²². This methodology provides a cost for steam based on the heat input required to produce. To this end, the Commission used the natural gas as heat input and, thus, the price of natural gas in Thailand as published by the Thai Ministry of Energy ¹²³. Since this methodology calculates only the fuel cost of steam, the Commission adjusted this cost for water, consumables, other costs, SG&A and profit. The Commission considered that an overall rate covering these costs and profit would be reasonable. No comments on this point in the 2nd Note were received from interested parties.

Manufacturing overhead costs, SG&A costs, profits

• (173) According to Article 2(6a)(a) of the basic Regulation, ‘the constructed normal value shall include an undistorted and reasonable amount for administrative, selling and general costs and for profits’. In addition, a value for manufacturing overhead costs needs to be established to cover costs not included in the factors of production referred to above.

• (174) The manufacturing overheads incurred by the cooperating exporting producers were expressed as a share of the costs of manufacturing actually incurred by the exporting producers. This percentage was applied to the undistorted costs of manufacturing.

• (175) For establishing an undistorted and reasonable amount for manufacturing overheads, SG&A costs and profit, the Commission relied on the financial data of the four Thai companies, SIAM KRAFT INDUSTRY CO LTD, DOUBLE A (1991) PUBLIC COMPANY, THAI CONTAINERS GROUP CO LTD and SIG COMBIBLOC CO LTD. as extracted from Orbis.

• (176) SG&A costs expressed as a percentage of the Costs of Goods Sold (‘COGS’) and applied to the undistorted costs of production, amounted to 11,38 %. The profit expressed as a percentage of the COGS and applied to the undistorted costs of production, amounted to 9,29 %. The Commission considered that these rates, when applied to the undistorted costs of production, would result in an amount for profit that would be reasonable, within the meaning of Article 2(6a)(a) of the basic Regulation, for the ex-works level of trade.

Calculation

• (177) On the basis of the above, the Commission constructed the normal value per product type on an ex-works basis in accordance with Article 2(6a)(a) of the basic Regulation.

• (178) First, the Commission established the undistorted manufacturing costs. The Commission applied the undistorted unit costs to the actual consumption of the individual factors of production of the cooperating exporting producer. These consumption rates were verified by the Commission. The Commission multiplied the consumption rates by the undistorted costs per unit observed in the representative country, as described in Section 3.2.4.1.

• (179) Then the Commission added manufacturing overheads, as explained in recital (173) to the undistorted cost of manufacturing in order to arrive at the undistorted costs of production.

• (180) To the costs of production established as described in the previous recital, the Commission applied the SG&A costs and profit percentages calculated in recitals (174) to (175).

• (181) On that basis, the Commission constructed the normal value per product type on an ex-works basis in accordance with Article 2(6a)(a) of the basic Regulation.

3.3.   Export price

• (182) The sampled exporting producers exported to the Union either directly to independent customers or through related companies.

• (183) For the exporting producers that exported the product concerned directly to independent customers in the Union, the export price was the price actually paid or payable for the product concerned when sold for export to the Union, in accordance with Article 2(8) of the basic Regulation.

• (184) One exporting producer partially exported the product concerned to the Union through a related user, acting as an importer who further processed the product concerned. The exporting producer did not provide detailed information about the cost of further processing and the final selling price, the Commission therefore provisionally decided to use for these transactions the export price to the related user. The Commission requested data about the cost of processing and the final selling price, which then will be used at definitive stage to establish the export price on the basis of the price at which the imported product was first resold to independent customers in the Union, in accordance with Article 2(9) of the basic Regulation.

3.4.   Comparison

• (185) Article 2(10) of the basic Regulation requires the Commission to make a fair comparison between the normal value and the export price at the same level of trade and to make allowances for differences in factors which affect prices and price comparability. In the case at hand the Commission chose to compare the normal value and the export price of the sampled exporting producers at the ex-works level of trade. As further explained below, where appropriate, the normal value and the export price were adjusted in order to: (i) net them back to the ex-works level; and (ii) make allowances for differences in factors which were claimed, and demonstrated, to affect prices and price comparability.

3.4.1.   Adjustments made to the normal value

• (186) As explained in recital (177) the normal value was established at the ex-works level of trade by using costs of production together with amounts for SG&A and for profit, which were considered to be reasonable for that level of trade. Therefore, no adjustments were necessary to net the normal value back to the ex-works level.

• (187) Save for a VAT adjustment on the account of non-refundable VAT, the Commission found no reasons for making any allowances to the normal value, nor were such allowances claimed by any of the sampled exporting producers.

3.4.2.   Adjustments made to the export price

• (188) In order to net the export price back to the ex-works level of trade, adjustments were made on the account of: customs duty, other import charges, freight, insurance, yearly rebates, handling loading and ancillary expenses and packing expenses.

• (189) Allowances were made for the following factors affecting prices and price comparability: credit cost and bank charges

3.5.   Dumping margins

• (190) For the sampled exporting producers, the Commission compared the weighted average normal value of each type of the like product with the weighted average export price of the corresponding type of the product concerned, in accordance with Article 2(11) and (12) of the basic Regulation.

• (191) On this basis, the provisional weighted average dumping margins expressed as a percentage of the CIF Union frontier price, duty unpaid, are as follows:

Company	Provisional dumping margin
Hangzhou HUAWANG New Material Technology Co., Ltd	34,9  %
KINGDECOR (Zhejiang) Co., Ltd.	31,0  %

• (192) For the cooperating exporting producers outside the sample, the Commission calculated the weighted average dumping margin, in accordance with Article 9(6) of the basic Regulation. Therefore, that margin was established on the basis of the margins of the sampled exporting producers, disregarding the margins of the exporting producers with zero and de minimis dumping margins, as well as margins established in the circumstances referred to in Article 18 of the basic Regulation.

• (193) On this basis, the provisional dumping margin of the cooperating exporting producers outside the sample is 33,6 %.

• (194) For all other exporting producers in the PRC, the Commission established the dumping margin on the basis of the facts available, in accordance with Article 18 of the basic Regulation. To this end, the Commission determined the level of cooperation of the exporting producers. The level of cooperation is the volume of exports of the cooperating exporting producers to the Union expressed as proportion of the total imports from the country concerned to the Union in the IP, that were established on the basis of Eurostat.

• (195) The level of cooperation in this case was high because the exports of the cooperating exporting producers constituted around 90 % of the total imports during the IP. On this basis, the Commission decided to establish the dumping margin for non-cooperating exporting producers at the level of the sampled company with the highest dumping margin.

• (196) The provisional dumping margins, expressed as a percentage of the CIF Union frontier price, duty unpaid, are as follows:

Company	Provisional dumping margin
Hangzhou HUAWANG New Material Technology Co., Ltd	34,9  %
KINGDECOR (Zhejiang) Co., Ltd.	31,0  %
Other cooperating companies	33,6  %
All other imports	34,9  %

4. INJURY

4.1.   Definition of the Union industry and Union production

• (197) The like product was manufactured by seven producers in the Union during the investigation period ¹²⁴. They constitute the ‘Union industry’ within the meaning of Article 4(1) of the basic Regulation.

• (198) The total Union production during the investigation period was established at around 473 000 tonnes. The Commission established the figure on the basis of all the available information concerning the Union industry, such as the macro questionnaire reply submitted by the complainant and verified by the Commission. As indicated in recital (15) the three sampled Union producers represented 60 % of the estimated total EU production and 61 % of the estimated total EU sales quantity of the like product.

4.2.   Determination of the relevant Union market

• (199) To establish whether the Union industry suffered injury and to determine consumption and the various economic indicators related to the situation of the Union industry, the Commission examined whether and to what extent the subsequent use of the Union industry’s production of the like product had to be taken into account in the analysis.

• (200) As explained in recital (27), decor paper is used as a surface material for decorative applications. Decor paper is used as intermediate product which is then laminated onto wood-based panels such as medium density fibreboards or particleboard through the use of high temperatures and pressure, or, alternatively, by means of adhesives. Decor paper’s end use is mainly in the furniture, interior design or construction sector.

• (201) There were no captive sales of the product under investigation on the Union market during the period considered. One of the sampled Union producers was part of a large group of companies purchasing decor paper from their related party and using it for the production of other downstream products. The Commission analysed the related sales transactions and associated documents, and considered those sales made to related companies as free market sales, as these sales to separate legal entities were made approximately at the same price as those charged to independent parties and those entities had a free choice of supplier.

• (202) A non-complainant Union producer was also part of a larger group of companies involved in further processing of the product under investigation. However, given its lack of cooperation, the Commission was not able to ascertain the terms of sales to related parties for this producer. In the absence of detailed information, the Commission considered the estimated sales volume in the Union provided by the complainant as free market sales in the analysis of Union consumption and Union sales volume in the Union market.

• (203) The distinction between captive and free market is relevant for the injury analysis because products destined for captive use are not exposed to direct competition from imports. By contrast, production destined for free market sale is in direct competition with imports of the product concerned.

4.3.   Union consumption

• (204) The relevant CN codes also encompassed other types of specialty paper outside the definition of the product under investigation. In order to calculate the Union consumption, the Commission compared the import data statistics post-IP at both 8-digit CN and 10-digit TARIC code level from the Surveillance database. The TARIC codes were only available after the initiation of the investigation and related exclusively to the product under investigation. The comparison showed that for the period from July 2024 to November 2024, the volumes of decor paper imported into the Union at TARIC level constituted around 30 % of the overall volumes imported from China under the corresponding CN codes. Excluding China, imports of decor paper from the rest of the world at TARIC level accounted for around 15 % of total import volumes at CN level.

• (205) Given the above, the Commission established the Union consumption on the basis of:

• — the Union industry’s sales volume to the Union market, based on the verified questionnaire replies of the sampled Union producers and the macro-questionnaire submitted by the complainants;

• — the imports into the Union of the product concerned from the PRC, based on the verified sales quantities of the cooperating exporting producers, and adjusted to reflect the estimated total volume of imports from the PRC for the period considered ¹²⁵; and

• — the imports into the Union of the product concerned from third countries based on a ratio applied to Eurostat statistics ¹²⁶.

• (206) Union consumption developed as follows:

Table 2

Union consumption (tonnes)

	2020	2021	2022	2023	Investigation period
Total Union consumption	430 260	501 495	416 247	369 929	371 822
Index	100	117	97	86	86
Source: verified questionnaire replies of the sampled Chinese exporting producers, macro-questionnaire, Eurostat().	Source: verified questionnaire replies of the sampled Chinese exporting producers, macro-questionnaire, Eurostat().	Source: verified questionnaire replies of the sampled Chinese exporting producers, macro-questionnaire, Eurostat().	Source: verified questionnaire replies of the sampled Chinese exporting producers, macro-questionnaire, Eurostat().	Source: verified questionnaire replies of the sampled Chinese exporting producers, macro-questionnaire, Eurostat().	Source: verified questionnaire replies of the sampled Chinese exporting producers, macro-questionnaire, Eurostat().

• (207) Union consumption sharply increased by 17 % between 2020 and 2021. This was mainly due to the increase in market demand for construction materials that was prompted by the COVID-19 pandemic. The pandemic led to lockdowns and boosted the home renovations market, which resulted in higher demand for decor paper, as it is mainly used in the production of furniture and laminate flooring.

• (208) Following 2021, Union consumption sharply dropped by 17 %, and in 2023 and in the investigation period by a further 11 %.

4.4.   Imports from the country concerned

4.4.1.   Volume and market share of the imports from the country concerned

• (209) The Commission established the volume of imports on the basis of the data provided by the cooperating exporting producers that were considered to represent almost 90 % of the volume of imports to the Union.

• (210) The market share of the Chinese imports was established by comparing import volumes with the Union market consumption as per Table 2 above.

• (211) Imports into the Union from the country concerned developed as follows:

Table 3

Import volume (tonnes) and market share

	2020	2021	2022	2023	Investigation period
Volume of imports from the PRC (tonnes)	4 618	11 885	14 673	24 436	24 800
Index	100	257	318	529	537
Market share (%)	1	2	4	7	7
Index	100	221	328	615	621
Source: Data provided by the sampled cooperating exporting producers().	Source: Data provided by the sampled cooperating exporting producers().	Source: Data provided by the sampled cooperating exporting producers().	Source: Data provided by the sampled cooperating exporting producers().	Source: Data provided by the sampled cooperating exporting producers().	Source: Data provided by the sampled cooperating exporting producers().

• (212) Chinese imports in 2020 were limited at around 4 600 tonnes at the beginning of the period considered and with a market share of 1 %. However, in 2021, imports increased exponentially by 157 %; this sharp upward trend continued throughout the rest of the period considered. Throughout the entire the period considered, imports increased by 437 % to more than 24 000 tonnes. During the period considered, Chinese imports increased by 6 percentage points.

• (213) The market share followed the same steep increase as the volume of imports from the People’s Republic of China, increasing by 521 % during the period considered. Moreover, the Chinese market share grew by three percentage points, from 4 % to 7 % in the span of one year, between 2022 and 2023.

4.5.   Prices of the imports from the country concerned and price undercutting

• (214) The Commission established the prices of imports based on data provided by the cooperating exporting producers that were considered close to 90 % of imports to the Union.

• (215) The weighted average price of imports into the Union from the country concerned developed as follows:

Table 4

Import prices (EUR/tonne)

	2020	2021	2022	2023	Investigation period
People’s Republic of China	1 496	1 694	1 853	1 793	1 711
Index	100	113	124	120	114
Source: Data provided by the cooperating exporting producers.	Source: Data provided by the cooperating exporting producers.	Source: Data provided by the cooperating exporting producers.	Source: Data provided by the cooperating exporting producers.	Source: Data provided by the cooperating exporting producers.	Source: Data provided by the cooperating exporting producers.

• (216) Import prices from China increased in 2021 and 2022, following a similar trend as the Union industry average sales prices shown in Table 8. However, during the whole period considered, Chinese import prices remained far below the average Union sales prices, which increased to a level of 2 220 EUR/tonne in the investigation period.

• (217) The Commission determined the price undercutting during the investigation period by comparing:

• (1) the weighted average sales prices per product type of the sampled Union producers charged to unrelated customers on the Union market, adjusted to an ex-works level; and

• (2) the corresponding weighted average prices per product type of the imports from the sampled cooperating Chinese producers to the first independent customer on the Union market, established on a Cost, insurance, freight (CIF) basis, with appropriate adjustments for customs duties and post-importation costs.

• (218) The price comparison was made on a type-by-type basis for transactions at the same level of trade, duly adjusted where necessary, and after deduction of rebates and discounts. The result of the comparison was expressed as a percentage of the sampled Union producers’ theoretical turnover during the investigation period. It showed a weighted average undercutting margin of between 9,3 % and 10,9 % by the imports from the country concerned on the Union market.

• (219) The Commission, in addition, established the existence of price suppression starting from 2022, when the Union industry was faced with increased cost of production due to higher costs of raw materials and energy. However, the Union industry was not able to increase their prices sufficiently to offset the increases in cost of production due to price suppression from Chinese imports, which started in 2022 and continued throughout the period considered.

4.6.   Economic situation of the Union industry

4.6.1.   General remarks

• (220) In accordance with Article 3(5) of the basic Regulation, the examination of the impact of the dumped imports on the Union industry included an evaluation of all economic indicators having a bearing on the state of the Union industry during the period considered.

• (221) As mentioned in recital (15), sampling was used for the determination of possible injury suffered by the Union industry.

• (222) For the injury determination, the Commission distinguished between macroeconomic and microeconomic injury indicators. The Commission evaluated the macroeconomic indicators, related to all Union producers, on the basis of data contained in the reply to the macro-questionnaire provided by the complainant, the adjusted data from the cooperating Chinese exporting producers, and the adjusted Eurostat data on imports from third countries of the product under investigation, as explained in recital (204) and footnotes 126 and 127. The Commission evaluated the microeconomic indicators, related to the sampled Union producers, on the basis of data contained in the questionnaire replies from the sampled Union producers. Both sets of data were found to be representative of the economic situation of the Union industry.

• (223) The macroeconomic indicators are: production, production capacity, capacity utilisation, sales volume, market share, growth, employment, productivity, magnitude of the dumping margin.

• (224) The microeconomic indicators are: average unit prices, unit cost, labour costs, inventories, profitability, cash flow, investments, return on investments, and ability to raise capital.

4.6.2.   Macroeconomic indicators

4.6.2.1.   Production, production capacity and capacity utilisation

• (225) The total Union production, production capacity and capacity utilisation developed over the period considered as follows:

Table 5

Production, production capacity and capacity utilisation

	2020	2021	2022	2023	Investigation period
Production volume (tonnes)	547 775	635 842	511 674	464 523	473 850
Index	100	116	93	85	87
Production capacity (tonnes)	686 031	688 531	683 948	659 396	642 729
Index	100	100	100	96	94
Capacity utilisation (%)	80	92	75	70	74
Index	100	116	94	88	92
Source: Macro-questionnaire provided by the complainant.	Source: Macro-questionnaire provided by the complainant.	Source: Macro-questionnaire provided by the complainant.	Source: Macro-questionnaire provided by the complainant.	Source: Macro-questionnaire provided by the complainant.	Source: Macro-questionnaire provided by the complainant.

• (226) The production volume of the Union industry decreased by 13 % between 2020 and the investigation period, in line with the trends in sales volume as shown in Table 8 below. The temporary increase in production volumes in 2021 could be attributed to the uptick in demand caused, as explained in recital (207), by the ‘stay-at-home’ economy during the lockdowns following the COVID-19 pandemic. However, starting from 2022 production volumes started to decrease. The decrease was due to lower market demand for decor paper in the Union, which was further exacerbated by the high inventory levels that were built up through the supply chain, as explained in recitals (245) and (246). In addition, following the increase in dumped imports from the PRC that mostly concerned commercial grade decor paper (such as whites, light colours and browns), to keep market share several Union producers had to focus production on more intensive colours which led to longer and more frequent preparation and maintenance of the paper machines, leading to longer production downtimes.

• (227) The total Union capacity fluctuated throughout the period considered. During 2021 the declared production capacity increased due to longer in-between periods scheduled for planned maintenance of the decor paper machines. Starting from 2022 onwards, capacity started to decrease. This was mostly due to the cessation of decor paper production at the end of 2022 of one Union producer, and the insolvency of another Union producer starting end of 2023.

• (228) The capacity utilisation increase observed in 2021 was prompted by the increase in net production volumes due to increased market demand for decor paper during the COVID-19 pandemic. Production volumes and capacity utilisation in 2022, 2023 and in the investigation period were far below the pre-2022 levels, which was a consequence of the overall decrease in market demand for decor paper and intensified competition from Chinese dumped imports.

4.6.2.2.   Sales volume and market share

• (229) The Union industry’s sales volume and market share developed over the period considered as follows:

Table 6

Sales volume and market share

	2020	2021	2022	2023	Investigation period
Total sales volume on the Union market (tonnes)	399 241	449 781	365 243	334 737	335 333
Index	100	113	91	84	84
Market share (%)	93	90	88	90	90
Index	100	97	95	98	97
Source: Macro questionnaire provided by the complainant, adjusted data from the cooperating Chinese producers, and the adjusted Eurostat data, as explained in recital (204) and footnotes 126 and 127.	Source: Macro questionnaire provided by the complainant, adjusted data from the cooperating Chinese producers, and the adjusted Eurostat data, as explained in recital (204) and footnotes 126 and 127.	Source: Macro questionnaire provided by the complainant, adjusted data from the cooperating Chinese producers, and the adjusted Eurostat data, as explained in recital (204) and footnotes 126 and 127.	Source: Macro questionnaire provided by the complainant, adjusted data from the cooperating Chinese producers, and the adjusted Eurostat data, as explained in recital (204) and footnotes 126 and 127.	Source: Macro questionnaire provided by the complainant, adjusted data from the cooperating Chinese producers, and the adjusted Eurostat data, as explained in recital (204) and footnotes 126 and 127.	Source: Macro questionnaire provided by the complainant, adjusted data from the cooperating Chinese producers, and the adjusted Eurostat data, as explained in recital (204) and footnotes 126 and 127.

• (230) Union industry sales volume increased in 2021 by 13 percentage points compared to 2020, mainly due to the aforementioned increase in demand prompted by COVID-19 lockdowns (see recital (207)). As explained above, the demand for decor paper started decreasing in 2022 after the high demand in 2021. As Chinese imports started increasing both in absolute terms and in market shares as from the second half of 2021, this resulted in a significant drop in Union sales volumes.

• (231) Market share dropped from 93 % to 90 % during the period considered. The further reduction in 2022 to 88 % can be attributed to an increase in market share from third countries which abated in 2023 and the investigation period.

4.6.2.3.   Growth

• (232) As explained above, due to the boom in home renovation caused by lockdowns during the COVID-19 pandemic, the union industry was able to profit from high demand and sales price above cost of production, which led to 2021 as being the only profitable year of the period considered. However, this situation was reversed starting from 2022, when the Union industry was faced with dwindling demand, coupled with competition from Chinese dumped imports, which led to prices to be set at below cost of production, as shown in Table 8 below.

4.6.2.4.   Employment and productivity

• (233) Employment and productivity developed over the period considered as follows:

Table 7

Employment and productivity

	2020	2021	2022	2023	Investigation period
Number of employees	2 288	2 323	2 300	2 234	2 218
Index	100	102	101	98	97
Productivity (unit per FTE)	240	274	223	208	214
Index	100	114	93	87	89
Source: Macro-questionnaire provided by the complainant.	Source: Macro-questionnaire provided by the complainant.	Source: Macro-questionnaire provided by the complainant.	Source: Macro-questionnaire provided by the complainant.	Source: Macro-questionnaire provided by the complainant.	Source: Macro-questionnaire provided by the complainant.

• (234) After a slight increase by 2 % in the number of employees in 2021, the Union industry decreased its workforce from 2021 until the investigation period, as its production and sales volumes decreased. Moreover, some sampled Union producers had to resort to short-time work during the COVID-19 pandemic in 2020 and for the period starting from end of 2022 up to the investigation period due to lack of orders and consequent frequent stops of machines. This situation was however not reflected in the total number of employees, as the affected employees were still employed by the companies and kept on their payrolls.

• (235) Productivity developed in line with the changes in production volumes. It decreased by 11 % over the period considered, with a temporary increase in 2021, thanks to the increase in Union industry’s production and sales due to above mentioned exceptionally favourable conditions in that year. The change in the product mix and subsequent increased machine maintenance and startup times, explained in recital (225), further reduced the productivity per FTE as from 2022.

4.6.2.5.   Magnitude of the dumping margin and recovery from past dumping

• (236) All dumping margins were significantly above the de minimis level. The impact of the magnitude of the actual margins of dumping on the Union industry was substantial, given the volume and prices of imports from the country concerned.

• (237) This is the first anti-dumping investigation regarding the product concerned. Therefore, no data were available to assess the effects of possible past dumping.

4.6.3.   Microeconomic indicators

4.6.3.1.   Prices and factors affecting prices

• (238) The weighted average unit sales prices of the sampled Union producers to unrelated customers in the Union developed over the period considered as follows:

Table 8

Sales prices in the Union

	2020	2021	2022	2023	Investigation period
Average unit sales price in the Union on the total market (EUR/tonne)	1 714	1 892	2 398	2 353	2 220
Index	100	110	140	137	130
Unit cost of production (EUR/tonne)	1 809	1 853	2 521	2 406	2 272
Index	100	102	139	133	126
Source: Verified questionnaire replies of the sampled Union producers.	Source: Verified questionnaire replies of the sampled Union producers.	Source: Verified questionnaire replies of the sampled Union producers.	Source: Verified questionnaire replies of the sampled Union producers.	Source: Verified questionnaire replies of the sampled Union producers.	Source: Verified questionnaire replies of the sampled Union producers.

• (239) During the period considered, sales prices followed a bell-shaped curve, peaking in 2022 and decreasing in 2023 and during the investigation period. The unit sales price followed the same trend as the cost of production. In 2020, the Union industry started in an unfavourable economic position due to temporary reductions in production and number of machines in operation, and it could not keep the average unit sales price above cost of production. After the second half of the year, demand rebounded, as the pandemic-led ‘stay-at-home’ economy pushed people to invest disposable income in home renovations. 2021 constituted the only year in which the Union industry was able to increase its prices above cost of production. This trend was quickly reversed in the following years when the Union industry was not able to keep sales prices above cost of production.

• (240) The cost of production was driven mainly by raw material and energy costs. In particular, the trend in cost of production followed closely the trend in prices for the two main raw materials, titanium dioxide (‘TiO2’) and wood pulp. Moreover, in 2022, Russia’s unprovoked and unjustified military aggression against Ukraine caused a large increase in energy costs, which continued throughout 2023 and the investigation period.

• (241) Moreover, as shown in Table 4, Chinese prices during the period considered were consistently lower as compared to the Union industry cost of production, with a difference in price ranging between 9 % during the peak of 2021 and around 25 % for the rest of the period considered, including the investigation period. Hence, during most of the period considered the Union industry was not able to increase its prices sufficiently to cover its costs of production, which indicated that the dumped imports from China suppressed the prices of the Union industry.

4.6.3.2.   Labour costs

• (242) The average labour costs of the sampled Union producers developed over the period considered as follows:

Table 9

Average labour costs per employee

	2020	2021	2022	2023	Investigation period
Average labour costs per employee (EUR/FTE)	53 553	57 911	57 759	56 913	57 544
Index	100	108	108	106	107
Source: Verified questionnaire replies of the sampled Union producers.	Source: Verified questionnaire replies of the sampled Union producers.	Source: Verified questionnaire replies of the sampled Union producers.	Source: Verified questionnaire replies of the sampled Union producers.	Source: Verified questionnaire replies of the sampled Union producers.	Source: Verified questionnaire replies of the sampled Union producers.

• (243) Average labour cost per employee increased by 7 % over the period considered.

4.6.3.3.   Inventories

• (244) Stock levels of the sampled Union producers developed over the period considered as follows:

Table 10

Inventories

	2020	2021	2022	2023	Investigation period
Closing stocks (tonnes)	25 570	33 788	33 767	39 015	39 140
Index	100	132	132	153	153
Closing stocks as a percentage of production (%)	8,43	9,22	11,83	15,00	14,31
Index	100	109	140	178	170
Source: Verified questionnaire replies of the sampled Union producers.	Source: Verified questionnaire replies of the sampled Union producers.	Source: Verified questionnaire replies of the sampled Union producers.	Source: Verified questionnaire replies of the sampled Union producers.	Source: Verified questionnaire replies of the sampled Union producers.	Source: Verified questionnaire replies of the sampled Union producers.

• (245) The level of inventories in absolute terms and as a percentage of production increased by 53 % and 70 %, respectively. In 2021, peak consumer demand and production, coupled with compounding demand requests throughout the supply chain triggered a bullwhip effect. This created stockpiling in the warehouses of the Union producers and their customers, with some reporting delayed call-offs of produced quantities, lasting throughout the subsequent period.

• (246) The decor paper business works mostly based on orders and call-off stock arrangements. Moreover, one of the sampled Union producers implemented a system characterised by a mix of made-to-order stock and express stock, made available for last minute orders of the most commonly sold types of decor paper. Compounding stock, coupled with decreasing demand and production quantity led to the increase in closing stock during the period considered, subsequently resulting also in an increase in closing stocks as a percentage of production.

• (247) However, given that most product types of the like product were produced by the Union industry based on specific orders of users, the level of stocks was not considered to be a meaningful injury indicator for this industry.

4.6.3.4.   Profitability, cash flow, investments, return on investments and ability to raise capital

• (248) Profitability, cash flow, investments and return on investments of the sampled Union producers developed over the period considered as follows:

Table 11

Profitability, cash flow, investments and return on investments

	2020	2021	2022	2023	Investigation period
Profitability of sales in the Union to unrelated customers (% of sales turnover)	–1,8	6,1	0,3	–1,5	–1,6
Index	100	334	15	85	90
Cash flow (EUR)	25 782 599	68 211 077	25 816 186	8 194 398	16 361 914
Index	100	265	100	32	63
Investments (EUR)	14 675 504	13 502 987	19 605 557	11 004 427	7 873 781
Index	100	92	134	75	54
Return on investments (%)	–6,9	31,2	4,2	4,6	6,5
Index	100	552	160	167	194
Source: Verified questionnaire replies of the sampled Union producers.	Source: Verified questionnaire replies of the sampled Union producers.	Source: Verified questionnaire replies of the sampled Union producers.	Source: Verified questionnaire replies of the sampled Union producers.	Source: Verified questionnaire replies of the sampled Union producers.	Source: Verified questionnaire replies of the sampled Union producers.

• (249) The Commission established the profitability of the three sampled Union producers by expressing the pre-tax net profit of the sales of the like product to unrelated customers in the Union as a percentage of the turnover of those sales.

• (250) In the years prior to the period considered, from 2014 to 2019, the Union industry was profitable, see recital (281). At the start of the period considered however, the Union industry’s results were negative due to the economic downturn in 2020 caused by the COVID-19 pandemic and the consequent loss in demand during the first half of that year. This market contraction resulted in a decline in sales and increase in costs mainly due to frequent machine stoppages and the resort to short-time work by some Union producers, as explained in recital (234). In 2021, profitability experienced a peak due to the boom in house renovations following the COVID-19 pandemic, and started to deteriorate in 2022, reaching negative profitability levels in 2023 and the investigation period. As already shown in Table 11 above, the Union industry was able to keep its prices above cost of production only in 2021.

• (251) The imbalance between cost of production and depressed prices translated into the erosion in profitability starting from 2022 onwards.

• (252) The net cash flow is the ability of the Union producers to self-finance their activities. The trend in net cash flow fluctuated during the period considered, experiencing a sharp increase in 2021 due to the favourable circumstances for the decor paper industry created by the effects of the lockdowns. Cash flow in 2022 returned to the same levels as 2020, before experiencing a sharp drop in 2023. Due to the period differences existing between the years prior the investigation period and the investigation, whereby the calculation for changes in inventories could not be considered as providing a reliable picture of the true cash flow positions of one of the EU sampled companies. Hence, the rebound shown during the investigation period can be considered as artificially inflated. In any event, even when taking the cash flow for the investigation period in full, the Union industry still experienced a decrease of 37 % during the period considered.

• (253) Investments decreased by – 8 % in 2021, increased by + 42 % in 2022 before sharply dropping by – 59 % and – 21 % in 2023 and the investigation period, respectively. The increase in 2022 can be attributed to several investments undertaken following the high market demand and profit margins of 2021.

• (254) The return on investments is the profit in percentage of the net book value of investments. Despite a negative return on investment experienced in 2020, it more than quadrupled in 2021 before decreasing again in 2022 and 2023. During the investigation period, return on investment reached 6,5 %, marking an increase of 94 % as compared to 2020. It must also be recalled that the return on investment is calculated on the overall profitability of the product under investigation, thus also including sales on the export markets. As explained in recital (239), while prices on the Union market were generally set below cost of production (with the exception of 2021), prices on export market were generally higher and above cost of production, as it will be shown in Table 13. While return on investment almost doubled between 2020 and the investigation period, other indicators such as investments and cash flow still showed a negative trend for the period considered.

• (255) The sampled Union producers’ ability of the Union industry to raise capital was thus considered to be affected by the erosion of the profitability as well as of the cash flow incurred over the period considered.

4.7.   Conclusion on injury

• (256) The majority of the injury indicators showed a negative trend during the period considered. Although the situation of the Union industry temporarily improved in 2021, the injury indicators such as production volume, sales volume on the Union market, and profitability decreased in 2022 and then further declined in the investigation period.

• (257) The sales volume of the Union industry decreased by 16 % between 2020 and the investigation period. This decrease was more significant than the Union consumption, which decreased by 14 % during the period considered. In particular, the Union industry sales quantity on the Union market experienced a sharper drop in 2022 (9 %) and in the period covering 2023 and the investigation period (16 %) as compared to the decline in the consumption (3 % in 2022 and 14 % in 2023 and the investigation period).

• (258) While the Union industry started in 2020 from an unfavourable economic position due to frequent machines stoppages and the resort to short time work for several Union industry producers caused by plummeting demand at the outset of the COVID-19 pandemic (recital (250)), in 2021 the Union industry was able to improve their economic situation due to the increased market demand for decor paper at the start of the COVID-19 pandemic. However, this positive trend was reversed by 2022 and the subsequent period, when Union producers experienced not only dwindling demand, but also increased competition from fast-growing Chinese dumped volumes.

• (259) In addition, as already highlighted in recital (219), starting from 2022, the Union industry was faced with increases in the cost of production driven mainly by higher costs of raw materials and energy. The Union industry, however, could not increase their sales prices sufficiently to offset these significant cost increases due to price suppression from Chinese imports. The gap between cost of production and sales prices in the Union was around 4 % during 2023 and the investigation period, leading to a sharp decrease in profitability as compared to 2021.

• (260) On the basis of the above, the Commission concluded at this stage that the Union industry suffered material injury within the meaning of Article 3(5) of the basic Regulation.

5. CAUSATION

• (261) In accordance with Article 3(6) of the basic Regulation, the Commission examined whether the dumped imports from the country concerned caused material injury to the Union industry. In accordance with Article 3(7) of the basic Regulation, the Commission also examined whether other known factors could at the same time have injured the Union industry. The Commission ensured that any possible injury caused by factors other than the dumped imports from the country concerned was not attributed to the dumped imports. These factors are:, effects of the dumped imports, imports from third countries, effects of the decrease in consumption on the Union market, as well as the export performance of the Union industry.

5.1.   Effects of the dumped imports

• (262) As shown in Table 3, Chinese imports steadily increased during the period considered, from a market share of 1 % in 2020 to 7 % in the investigation period. Moreover, Chinese import volumes almost doubled in the span of one year, between 2022 and 2023. Chinese landed prices remained below Union industry’s prices throughout the period considered, even in 2021 when market demand for decor paper in the Union increased significantly. Moreover, the Chinese market share followed a steep upward trend, increasing by 521 % during the period considered (recital (213)), from 1 % to 7 %.

• (263) The Commission also found that Chinese import prices were consistently lower than the Union industry’s cost of production, exerting price suppression during the period considered. As demand in 2022 dwindled, and the Union industry started to face increased and fast-growing competition from Chinese dumped imports, the Union industry was unable to set their prices above cost of production.

• (264) Chinese dumped on the Union market exerted price suppression on Union industry sales prices.

• (265) In addition, as already mentioned in recital (218), the Commission established a weighted average undercutting margin of between 9,3 % and 10,9 % by the imports from the sampled exporting producers on the Union market in the investigation period, coinciding in time with the increasingly deteriorating situation of the Union industry.

• (266) The analysis of the injury indicators shows that the economic situation of the Union industry worsened especially towards the second half of the period considered and this coincided with a significant increase of dumped imports from the country concerned, which were found to undercut the Union industry prices during the investigation period. Those imports, in any event, caused significant price suppression throughout the period considered, as the Union industry was not able to increase its prices in line with the increase of cost of production, and even had to decrease the prices below the cost of production in the investigation period.

• (267) In view of the above considerations, the Commission provisionally established that there is a causal link between the material injury suffered by the Union industry and the dumped imports from China within the meaning of Article 3(6) of the basic Regulation. Such injury had both volume and price effects.

5.2.   Effects of other factors

• (268) The Commission also examined whether other known factors, individually or collectively, were capable of attenuating the causal link established between the dumped imports to the effect that such link would no longer be genuine and substantial.

5.2.1.   Consumption decrease

• (269) During the period considered, Union consumption spiked in 2021 thanks to favourable market conditions in the construction and renovation sectors created by the COVID-19 pandemic. Following the relaxation of the COVID-19 measures in 2022, demand for decor paper-based applications consequently decreased. This downward trend started in 2022 and lasted throughout 2023 and the investigation period.

• (270) However, slumping demand cannot break the causal link between the influx of dumped imports from the PRC and the injury suffered by the Union industry, as the EU industry sales quantity on the EU market experienced a sharper drop in 2022 (9 %) and the period comprising 2023 and the investigation period (16 %) as compared to the decline in the consumption (3 % in 2022 and 14 % in 2023 and the investigation period). In addition, as already highlighted in Table 3, Chinese exporters were able to sharply increase their exports to the EU during the period considered, and to almost double their market share in only one year (from 2022 to 2023); the trends in consumption must thus be seen not only in the context of an established decrease in demand in the Union market, but also taking into account the trend of Chinese imports, whereby a sharp rise in dumped imports negatively affected the sales volume of the Union industry.

5.2.2.   Imports from third countries

• (271) The volume of imports from other third countries developed over the period considered as follows:

Table 12

Imports from third countries