Commission Implementing Regulation (EU) 2025/698 of 10 April 2025 extending the definitive anti-dumping duty imposed by Implementing Regulation (EU) 2021/633 on imports of monosodium glutamate originating in the People’s Republic of China to imports of monosodium glutamate consigned from Malaysia, whether declared as originating in Malaysia or not

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 13 thereof,

Whereas:

(1) In December 2008, the Council of the European Union imposed a definitive anti-dumping duty on imports of monosodium glutamate (‘MSG’) originating in the People’s Republic of China (‘the PRC’ or ‘China’) by Council Regulation (EC) No 1187/2008 (2). The anti-dumping duties in force range between 36,5 % and 39,7 % for imports originating in the PRC. The investigation that led to these duties was initiated in September 2007 (‘the original investigation’) (3).

(2) In January 2015, following an expiry review in accordance with Article 11(2) of the basic Regulation, the European Commission (‘the Commission’) extended the existing measures by Commission Implementing Regulation (EU) 2015/83 (4).

(3) In October 2020, following an anti-circumvention investigation, the existing measures were extended to imports into the Union of monosodium glutamate in mixture or in solution, containing by dry weight 50 % or more of monosodium glutamate, originating in the PRC, by Commission Implementing Regulation (EU) 2020/1427 (5).

(4) In April 2021, following an expiry review, the Commission again extended the existing measures by Commission Implementing Regulation (EU) 2021/633 (6).

(5) On 6 June 2024, the Commission received a request pursuant to Articles 13(3) and 14(5) of the basic Regulation to investigate the possible circumvention of the anti-dumping measures imposed on imports of MSG originating in China by imports of MSG consigned from Malaysia, whether declared as originating in Malaysia or not, and to make such imports subject to registration (‘the request’).

(6) The request was lodged by Ajinomoto Foods Europe, the sole producer of MSG in the Union (‘the applicant’).

(7) The request contained sufficient evidence of a change in the pattern of trade involving exports from China and Malaysia to the Union that had taken place following the imposition of measures on MSG originating in China.

(8) Moreover, the request provided evidence showing that this change appeared to stem from a practice, process or work for which there was insufficient due cause or economic justification other than the extension of the duty, namely the transshipment of the product concerned via Malaysia to the Union. To the extent that there is any processing of input materials into MSG in Malaysia, the request alleged that such processing would amount to a mere assembly/completion operation that should be considered to circumvent the measures in force within the meaning of Article 13(2) of the basic Regulation.

(9) Furthermore, the request contained sufficient evidence showing that the practice, process or work was undermining the remedial effects of the existing anti-dumping measures in terms of quantities and prices. Significant volumes of imports of the product under investigation appeared to have entered the Union market. In addition, there was sufficient evidence that such imports of MSG were made at injurious prices.

(10) Finally, the request contained sufficient evidence that MSG consigned from Malaysia was exported at dumped prices in relation to the normal value previously established for MSG originating in China.

(11) The product concerned by the possible circumvention is monosodium glutamate, currently classified under CN code ex 2922 42 00 (TARIC code 2922 42 00 20) and originating in the PRC (‘the product concerned’). This is the product to which the measures that are currently in force apply.

(12) The product under investigation is the same as the product concerned, currently falling under CN code ex 2922 42 00 but consigned from Malaysia, whether declared as originating in Malaysia or not (TARIC code 2922 42 00 15) (‘the product under investigation’).

(13) The investigation showed that MSG exported from China to the Union and MSG consigned from Malaysia, whether originating in Malaysia or not, have the same basic physical and chemical characteristics and have the same uses, and are therefore considered as like products within the meaning of Article 1(4) of the basic Regulation.

(14) Having determined, after having informed the Member States, that sufficient evidence existed for the initiation of an investigation pursuant to Article 13(3) of the basic Regulation, the Commission initiated the investigation and made imports of MSG consigned from Malaysia, whether declared as originating in Malaysia or not, subject to registration, by Commission Implementing Regulation (EU) 2024/1976 (7) (‘the initiating Regulation’).

(15) The initiating Regulation stated that, should circumvention practices covered by Article 13 of the basic Regulation, other than the one mentioned in recital (12) thereof, be identified in the course of the investigation, the investigation may also cover these practices.

(16) The investigation period covered the period from 1 January 2020 to 30 June 2024 (‘the investigation period’ or ‘IP’). Data were collected for the investigation period to investigate, inter alia, the alleged change in the pattern of trade following the imposition of measures on the product concerned, and the existence of a practice, process or work for which there was insufficient due cause or economic justification other than the imposition of the duty. More detailed data were collected for the period from 1 July 2023 to 30 June 2024 (‘the reporting period’ or ‘RP’) in order to examine if imports were undermining the remedial effect of the measures in force in terms of prices and/or quantities and the existence of dumping.

(17) The Commission officially informed the authorities of China and Malaysia, the known exporting producer in Malaysia (Ajinoriki MSG (M) Sdn Bhd (‘Ajinoriki’)), the Union industry and the known importers in the Union of the initiation of the investigation.

(18) In addition, the Commission asked the Mission of Malaysia to the European Union to provide it with the names and addresses of exporting producers and/or representative associations that could be interested in cooperating in the investigation in addition to the Malaysian exporting producers which had been identified in the request by the applicant. The Malaysian mission confirmed to the Commission that Ajinoriki is the only company in Malaysia known to be involved in the production of MSG.

(19) Exemption claim forms and questionnaires for producers/exporters in Malaysia, and for importers in the Union were made available on DG TRADE’s website.

(20) Only Ajinoriki submitted an exemption claim form and a questionnaire reply.

(21) Moreover, questionnaire replies were submitted by four Union importers. One of those companies did not import MSG from Malaysia so its reply was not analysed further. The Commission used the questionnaire replies of the other importers to cross check the trade flows and names of suppliers from Malaysia.

(22) In the process of verification of information and statistics provided by the applicant and the cooperating Malaysian companies, the Commission held on spot consultations with Malaysian Authorities, namely with Ministry of Investment, Trade and Industry, Malaysian Investment Development Agency, Suruhanjaya Syarikat Malaysia (public company register), Inland Revenue Board, Royal Malaysian Customs Department and Port Klang Port Authority.

(23) Furthermore, pursuant to Article 16 of the basic Regulation, the Commission carried out verification visits at the premises of Ajinoriki.

(24) Interested parties were given the opportunity to make their views known in writing and to request a hearing within the time limit set in the initiating Regulation. All parties were informed that the non-submission of all relevant information or the submission of incomplete, false or misleading information might lead to the application of Article 18 of the basic Regulation and to findings being based on the facts available.

(25) The request alleged transhipment of the product concerned originating in the PRC via Malaysia and that, if there was any processing in Malaysia, this would amount to an assembly/completion operation that would circumvent the measures within the meaning of Article 13(2) of the basic Regulation (see recital (7)).

(28) As stated in recital (25), Ajinoriki, the sole known exporting producer of MSG in Malaysia, requested to be exempted from the measures, if extended to Malaysia. It cooperated during the entire proceeding by submitting an exemption claim form and a questionnaire reply, and by agreeing to an on-spot verification. As the aggregated sales volumes of MSG to the Union Ajinoriki reported in its exemption claim form represented almost the totality of the Malaysian import volumes recorded in the Eurostat import statistics during the reporting period, the level of cooperation was considered to be high (8).

(32) The increase of exports of MSG from China to Malysia and from Malaysia to the Union, as well as the increase of exports of GA from China to Malaysia, constitute a change in the pattern of trade between China, Malaysia and the Union within the meaning of Article 13(1) of the basic Regulation.

(33) Ajinoriki requested an exemption on the grounds that it produces MSG in its own plant and therefore, in its view, does not circumvent the Chinese measures. In accordance with Article 13(2) of the basic anti-dumping Regulation, the processing operation carried out must in any case be examined to exclude an assembly operation in a third country which is circumventing the measures in force. In order to consider such an assembly operation, the criteria mentioned in recital (27) have to be met cumulatively.

(34) Ajinoriki was incorporated in 2016. Initial investment concerned the purchase of land, erection of the factory and the acquisition of mainly Chinese production equipment. The factory became operational during 2019, with first exports of produced MSG during the fourth quarter 2019, i.e. long after the initiation of the original investigation leading to the current measures.

(37) Therefore, the Commission concluded that the operation started since the initiation of the original anti-dumping investigation, and the parts concerned are from the country subject to measures.

(38) The producer produces MSG by reacting GA with soda ash in an aqueous solution applying heat (via gas generated water steam). The MSG resulting from the chemical reaction between GA and soda ash is freed from impurities using powdered activated carbon (‘PWAC’). Ajinoriki imports PWAC only from China, while the soda ash it uses originates in the USA.

(39) Based on the verified questionnaire’s response figures, the combined value of GA and PWAC represented [85-99] % of the total value of all parts of the assembled product in the RP. Therefore the 60 % criterion set out in Article 13(2)(b) of the basic Regulation was met. In addition, based on the verified information provided in the questionnaire reply in the RP, the value added to the imported parts was [11-17] % of the total manufacturing cost (packaging costs were deducted), hence below the 25 % threshold set out in Article 13(2)(b) of the basic Regulation.

(40) In addition, the verification of the information provided in Ajinoriki’s questionnaire reply revealed serious inconsistencies regarding the stocks of own-produced MSG. Taking into account Ajinoriki’s cost of production of MSG in its stocks as reported in its questionnaire response and its cost of production in the RP, the value of the stock at the beginning of RP was either undervalued or the volume of the stock was overstated. Consequently, as the Commission could neither establish the volume of stock at the beginning of the RP nor reconcile the total quantity sold with the total quantity produced in the RP, it could not establish that all the quantities of MSG sold were actually produced by the company, as declared in the questionnaire reply. The company could not explain the inconsistencies. Therefore, the Commission informed Ajinoriki that, in accordance with Article 18(1) of the basic Regulation, it intended to rely on facts available in respect of the quantities that they could not explain (‘Article 18 letter’).

(41) In its reply to the Article 18 letter, Ajinoriki stated that the information reported in the questionnaire reply was correct. Ajinoriki provided the auditor’s stock count records which formed the basis for the stock valuation in the financial statements and which confirmed the quantities reported in the questionnaire. In order to resolve the discrepancy between the value reported in the financial statements and the quantity in stock, Ajinoriki explained that instead of the production cost of MYR [5 – 6] per kilo as stated in an earlier version of the questionnaire response, only MYR [1-2] had been assumed for the purposes of the financial statements for the fiscal year from 1 September 2022 to 31 August 2023. This revision to the cost of production was essentially based on an MSG yield in the range of three to four times the volume input of GA. The average production costs of MYR [1-2] per kilogram thus obtained were included in a revised version of the questionnaire reply and would allow a reconciliation between the value reported in the financial statements and the corresponding quantity of MSG in stock.

(42) The Commission analysed the information received from Ajinoriki and found it inconclusive. In particular, the information on the quantities of raw materials used to produce MSG was inconsistent with both the verified company data and generally available information. For example, the ratio of GA to MSG according to Ajinoriki’s own production records in the RP did not match the one set out in its reply to the Article 18 letter. Given a chemical reaction which is the same for all producers, the ratio obtained from the production records of Ajinoriki is in line with the generally available information for this industry (12). Therefore, the Commission concluded that the explanations by Ajinoriki could not resolve the inconsistencies. By providing inconsistent information Ajinoriki did not provide necessary information within the meaning of Article 18(1) of the basic Regulation.

(43) Using the average cost of production of MYR [5-6] per kilogram (according to Ajinoriki’s previous version of the questionnaire response, which is consistent with the volume of necessary input materials as per its own production records) to convert the value of semi-finished MSG (i.e. unpackaged MSG) and finished MSG (i.e. already packaged) as reported in the audited financial statements as of 31 August 2023 into volume, and taking into account the subsequent production and sales volumes up to the end of the RP, leaves a volume of between 3 000 and 4 000 tonnes MSG sold to the EU and other third countries that cannot come from own production.

(44) On that basis, the Commission concluded that the producer, during a production downtime due to the expansion of the storage and packaging facilities, also exported to the EU MSG that had previously been imported from China by its related trading company.

(45) Article 13(1) of the basic Regulation requires that the change in the pattern of trade stems from a practice, process or work for which there is insufficient due cause or economic justification other than the imposition of the duty. The practice, process or work includes the consignment of the product subject to the existing measures via third countries and the assembly of parts/completion operations in a third country in accordance with Article 13(2) of the basic Regulation.

(46) The investigation found that Ajinoriki, the sole producer in Malaysia, accounting for virtually all imports of MSG from Malaysia, was established after the imposition of the original measures; its assembly operations, that constitute circumvention according to Article 13(2), began in 2019 (see recital (35)).

(47) In light of all these elements, the Commission concluded that there was insufficient due cause or economic justification other than the imposition of the duty for the initiation of processing operations of Ajinoriki in Malaysia and consequent increase of exports of MSG to the Union. The change in the pattern of trade was a result of the fact that the operation started after the original measures were imposed.

(48) In accordance with Article 13(1) of the basic Regulation, the Commission examined whether the imports of the product under investigation, both in terms of quantities and prices, undermined the remedial effects of the measures currently in force.

(49) The quantities of MSG imported into the Union increased significantly in absolute volumes during the investigation period and represented around 10 % of the Union consumption during the RP. Consumption in the Union was estimated on the basis of the request (13).

(50) The import prices of MSG from Malaysia in the RP undercut the Union prices provided by the applicant in the request (14).

(51) The Commission therefore concluded that the existing measures were undermined in terms of quantities and prices by the imports from Malaysia.

(52) In accordance with Article 13(1) of the basic Regulation, the Commission also examined whether there was evidence of dumping in relation to the normal values previously established for the like product.

(53) The Commission compared the average export prices of MSG from Malaysia in the RP, based on the verified data of Ajinoriki, to the normal values established for China in the last expiry review investigation, adjusted for inflation (15).

(54) The comparison of normal values and export prices showed that the MSG exported by Ajinoriki was exported at dumped prices during the reporting period.

(55) The four conditions of Article 13(1) of the basic Regulation are met. First, the Commission found a change in the pattern of trade between the Union, the PRC and Malaysia. Second, considering that Ajinoriki accounted for virtually all the exports to the Union in the RP, it was established that the change stemmed from a practice, process or work for which there was insufficient due cause or economic justification other than the imposition of the duty. Third, the Commission found that the remedial effects of the anti-dumping duty were being undermined. Fourth, the Commission found evidence of dumping.

(56) Based on the above findings, the Commission concluded that the anti-dumping duties imposed on imports of MSG originating in the PRC were being circumvented by imports of MSG consigned from Malaysia.

(57) Therefore, in accordance with Article 13(1) of the basic Regulation, the anti-dumping measures in force on imports of MSG originating in China should be extended to imports of the product under investigation.