Commission Implementing Regulation (EU) 2025/1139 of 6 June 2025 imposing a provisional anti-dumping duty on imports of hardwood plywood from the People’s Republic of China

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	2025/1139	10.6.2025

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 7 thereof,

After consulting the Member States,

Whereas:

1. PROCEDURE

1.1.   Initiation

• (1) On 11 October 2024, the European Commission (‘the Commission’) initiated an anti-dumping investigation with regard to imports of hardwood plywood originating in the People’s Republic of China (‘the country concerned’ or ‘the PRC’) on the basis of Article 5 of 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 27 August 2024 by Greenwood Consortium (‘the complainant’). The complaint was made on behalf of the Union industry of hardwood plywood 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.

1.2.   Registration

• (3) The Commission made imports of hardwood plywood subject to registration by Commission Implementing Regulation (EU) 2024/3140 ³ (‘the registration Regulation’).

1.3.   Interested parties

• (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 Chinese authorities, known importers, suppliers and users, traders, as well as associations known to be concerned 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.

1.4.   Comments on initiation

• (6) After initiation, the complainant, individual importers and the Plywood Trade Interest Alliance ⁴ (‘PTIA’) made several submissions on the evidence in the complaint relating to dumping, injury, causality and the Union interest. The comments are addressed below. The complainant and PTIA made two additional submissions rebutting each other’s comments, pursuant to Section 8 of the Notice of Initiation. Section 8 provides that any comment on information submitted by interested parties before the deadline of imposition of provisional measures should be made at the latest on day 75 from the date of publication of the Notice of Initiation, unless otherwise specified. The complainant’s submission was timely filed on 20 December 2024, within the relevant deadline. PTIA’s rebuttal comments were submitted on 15 January 2025. As these comments were submitted outside the relevant time limits set by the Notice of Initiation, they could not be taken into account.

1.4.1.   Comments on the complaint and the procedure

• (7) PTIA claimed that the complainant indexed and unreasonably treated the already aggregated data for nine companies as confidential which made it impossible to meaningfully understand the substance of the information. In addition, PTIA alleged that the complainant withheld essential data for reason of copyright and that copyright restrictions may not serve as a legitimate ground for withholding non-confidential information from other interested parties.

• (8) Regarding the indexation of aggregated data, the Commission found that the different product portfolio of the members of the Greenwood Consortium, the complainant, justified the confidential treatment of the aggregated data. As far as the information withheld due to copyright is concerned, it was found that the general export price level of Chinese hardwood plywood in the period 2010–2024 ⁵ was of a demonstrative nature rather than essential information rendering the analysis of the complaint unduly difficult.

• (9) The Commission thus rejected the claims because it found that the version open for inspection by interested parties of the complaint contained sufficient essential evidence and non-confidential summaries of otherwise confidential information to allow interested parties to exercise their right of defence throughout the proceeding and complied with the requirements of Article 19(2) of the basic Regulation.

• (10) PTIA claimed that the complainant did not submit information as required by Article 5(2) of the basic Regulation, whereas information submitted on other aspects was incomplete.

• (11) The Commission rejected the claim because it found that the complaint included prima facie evidence of dumping, injury and a causal link between the allegedly dumped imports and the alleged injury based on information reasonably available. The Commission considered that the version open for inspection by interested parties of the complaint contained sufficient essential evidence and non-confidential summaries of otherwise confidential information to allow interested parties to exercise their right of defence throughout the proceeding and thus and complied with the requirements of Article 19(2) of the basic Regulation.

• (12) PTIA submitted that the complainants, while perhaps satisfying the requirements for representativity of the Union industry under Article 5(4) of the basic Regulation, did not by any means constitute the entire Union industry in the sense of Article 3.

• (13) The Commission found that the standing requirement was satisfied because the complaint was supported by EU producers accounting for more than 25 % of the production of the like product in the EU produced by the EU industry, and no EU producer opposed it. For the initiation of the proceedings, beyond proving its standing, the complainant was not required to represent the entire Union industry. The Commission therefore also rejected this claim.

1.4.2.   Comments on dumping calculations

• (14) PTIA submitted that the dumping rates calculated in the complaint were excessively high and unduly inflated due to the product mix considered and a different production process in the PRC, which was not duly reflected in the calculations. PTIA further considered that the glue consumption mentioned in the complaint was incorrect, and that certain material was double counted. It also pointed out inconsistencies between the body of the complaint and the annexes. PTIA further argued that the invoices to evidence the export price were non-representative since they only referred to poplar plywood and not to all types of plywood imported to the Union.

• (15) Additionally, PTIA submitted that Türkiye was not an appropriate representative country because of the high inflation of the Turkish lira during the investigation period, especially with regard to establishing the selling, general and administrative costs (‘SG & A’) and profit. It furthermore argued that the data of the proposed Turkish company used as a benchmark to determine the profit and SG & A were not representative. It also considered that when calculating the labour costs, the complainant should have used the exchange rate of the European Central Bank instead of the exchange rate provided by the Turkish Central Bank, and that to determine the energy prices, the complainant should have used Turkish statistics and not the website www.globalpetrolprices.com.

• (16) The complainant argued that the high inflation in Türkiye had no impact on the determination of the benchmarks since the raw material prices were not expressed in Turkish lira but in EUR or US dollars and that the inflation would not impact the SG & A and profit of Turkish companies since the increase in costs would decrease the profit margin which resulted in a more conservative approach. Also, since the SG & A and profit were expressed as a percentage of the costs of goods sold, they would not be impacted by inflation. The complainant furthermore submitted that the benchmarks were reasonable and representative for the sector. With regard to energy prices, the complainant also argued that the energy data taken from the website www.globalpetrolprices.com were based on the official Turkish statistics.

• (17) The complainant also defended that there was no double counting in the calculation of the normal value in the complaint and that the calculations were based on the factors of production and the consumption rates applicable in the PRC and were duly adjusted to take into account the production process in the PRC. It also argued that the glue consumption in the complaint was accurately calculated and based on a reasonable, even conservative, approach. With regard to the claim of PTIA that the export price was not representative, it submitted that the invoices for the poplar plywood in the complaint were presented only as an additional element; the export price determination was based on Eurostat and the price index the Europäischer Wirtschaftsdienst GmbH ⁶ (EUWID), a trade new media publisher focussing on, amongst other, wood products.

• (18) Both the complainant and PTIA submitted comments on the analysis related to the significant distortions in the plywood sector in the PRC. These comments are addressed in Section 3.2.1.4 below.

• (19) The Commission duly considered the claims of PTIA on the evidence related to the dumping calculations in the complaint, as well as the additional elements provided by the complainant. It found that the requirements for the initiation of an investigation were met, i.e. that the accuracy and adequacy of the evidence presented by the complainant and determined it was sufficient to justify the initiation of an investigation.

• (20) Furthermore, the Commission considered that this had no impact on the conclusions on the existence of dumping – in this particular case, the prima facie evidence related to the normal value calculations of the different product types, factors of production and its respective consumption was deemed sufficient. The Commission further recalled that the dumping margin calculated in the complaint did not necessarily reflect the exact degree of dumping which will be calculated in the investigation on a transaction by transaction and type per type basis. Indeed, the nature of the analysis was different since it was not performed on a company per company basis, nor per transaction. However, the Commission was satisfied with the level of evidence provided by the complainant on the export price and normal value showing that the dumping margins were significant. Also, the figures on which the normal value was based were supported by sufficient evidence, and all the necessary adjustments to for instance consider a different production process in the PRC were taken into account in the Commission’s analysis of dumping. The Commission thus rejected the claims of PTIA on insufficient evidence of dumping in the complaint.

• (21) Furthermore, based on the information provided by the complainant and analysed by the Commission, the proposed choice of Türkiye as a representative country to determine the normal value met the requirement of sufficient evidences. In particular, domestic sales by Turkish producers of hardwood plywood appeared to be sufficiently large, and the production process and access to raw materials was similar to the Chinese producers, and the potential differences in the production process were taken into account in the normal value determination. The Commission also considered that the fact that there was high inflation in Türkiye did not impact the benchmarks which were indeed not expressed in Turkish liras, nor the determination of the SG & A and profit based on Turkish companies.

1.4.3.   Comments on injury

• (22) PTIA argued that the complaint does not meet the standard of positive evidence on injury under Article 3(2) of the basic Regulation, claiming that certain injury indicators, such as EU consumption; import prices; EU market share; production capacity and utilisation, domestic sales and turnover; employment; profitability, investments, stocks and production capacity did not support a finding of injury during the investigation period.

• (23) The Commission found that the complaint contained sufficient evidence for a prima facie finding of material injury necessary for the initiation of an investigation. Both macroeconomic and microeconomic indicators were analysed in Section 6 of the complaint. The Commission recalls that a prima facie finding of material injury necessary for the initiation of an investigation requires an examination, inter alia, of the relevant factors as described in the basic Regulation. It is not specifically required by Article 5 of the basic Regulation that all injury factors mentioned in Article 3(5) show deterioration in order for material injury to be sufficiently substantiated for the purpose of the initiation of an investigation. 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. The complaint contained this information, which pointed to the existence of injury. Accordingly, the Commission considered that the complaint contained sufficient evidence of injury and rejected the claim by PTIA.

• (24) PTIA submitted that the complainant based its undercutting and underselling calculation on poplar plywood only, noting that the Commission should base its preliminary and final calculations on all products covered by the scope of the investigation.

• (25) The Commission notes that, under the ‘sufficiency of evidence’ standard in Article 5(3) of the basic Regulation, there is no obligation to establish undercutting and underselling for all product types covered by the investigation. Furthermore, in line with the applicable legal rules, the Commission established the undercutting and underselling margins pursuant to the methodology presented below in Sections 4.3.2 and 6.1.

1.5.   Sampling

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

Sampling of Union producers

• (27) In the 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 the largest representative volume of production and sales which can reasonably be investigated within the time available. This sample consisted of three Union producers. The sample represented 28 % of the estimated total EU production and 33 % of the estimated total EU sales quantity of hardwood plywood and ensuring a good geographical spread. The Commission invited interested parties to comment on the provisional sample. No comments were received. The sample was representative of the Union industry.

Sampling of unrelated importers

• (28) To decide whether sampling is necessary and, if so, to select a sample, the Commission asked unrelated importers to provide the information specified in the Notice of Initiation.

• (29) Twenty unrelated importers 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 three unrelated importers on the basis of the largest volume of sales of the product concerned in the Union, and their geographic location in the Union. The sample represented 38 % of the estimated total EU sales quantity and ensured a good geographical spread. In accordance with Article 17(2) of the basic Regulation, all known importers concerned were consulted on the selection of the sample. No comments were received.

Sampling of exporting producers

• (30) To decide whether sampling is necessary and, if so, to select a sample, the Commission asked all exporting producers in the 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.

• (31) One hundred twenty 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 two exporting producers on the basis of the largest representative volume of exports to the Union taking into account the main wood species used in the production of hardwood plywood and exported to the Union (poplar, birch and eucalyptus plywood), which could reasonably be investigated within the time available. Based on the information available at the time, the sample represented 9,5 % of exports to the Union. 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.

• (32) By email of 29 November 2024, one of the sampled exporting producers, Xuzhou Shengfeng Wood Co., Ltd, informed the Commission that it withdrew its cooperation. On the same day, the Commission decided to add another exporting producer, Xuzhou Hongxin Wood Co., Ltd, to the sample of exporting producers and it informed interested parties of this change by a Note to the file of 29 November 2024. Based on the information available at that stage, the proposed sample accounted for 9,1 % (compared to originally 9,5 %) of the estimated total export quantity of hardwood plywood from the PRC to the Union in the investigation period.

• (33) However, the Commission did not receive a response from Xuzhou Hongxin Wood Co., Ltd by the deadline of 3 January 2025. The remaining sampled company, Pizhou Jianghsan Wood Co., Ltd (‘Jiangshan Wood’), represented 5,8 % of exports to the Union. The Commission considered, that, at this advanced stage of the investigation there was insufficient time left to select a new sample of exporting producers and, in addition, given the low quantities of exports to the Union by the remaining exporting producers that provided a sampling reply, any change to the sample would not result in a more representative sample. Therefore, the Commission decided to abandon sampling and apply Article 18 of the basic Regulation for the determination of dumping. The Commission however accepted the request to calculate an individual dumping margin for Jiangshan Wood ⁷, in accordance with Article 17(3), as the only company that provided a proper and timely questionnaire response that could be verified in accordance with Article 16(1) of the basic Regulation. The Commission informed interested parties of this decision by a Note to the file of 21 January 2025.

• (34) PTIA submitted comments on the initial sample. It considered that it was unusual that the Commission selected only two exporting producers, and it argued that the sample of exporting producers usually would consist of (at least) three exporting producers. It further argued that since three companies were selected for the sample of unrelated importers and Union producers, the Commission should add one more company to the sampled exporting producers to capture a higher volume of exports into the Union. It also argued that the Commission should have chosen a larger company, with a larger variety of manufactured and exported products since, according to its knowledge, Xuzhou Shengfeng Wood Co. exported a significant portion of recycled film-faced plywood, which was a low-end product, and which had a specific application in construction.

• (35) After the change of the sample following the withdrawal of Xuzhou Shengfeng Wood Co., Ltd, PTIA reiterated that the sample should consist of at least three exporting producers. This would in its view improve the quality and objectiveness of the Commission’s assessment of the commercial behaviour of the Chinese industry as a whole, for the entire spectrum of products it produces and exports to the Union. It further argued that the Union producers represented 28 % of estimated total Union production and 33 % of estimated total Union sales quantity of the like product, and the sample of the unrelated importers accounted for 38 % of estimated total sales quantity of the product under investigation in the Union. It considered that the Commission had not provided any reasoning or other compelling reason on why it considered the small sample of exporting producers as reasonable to analyse the exporting producers’ behaviour, prices and products produced and exported, based on two out of 120 exporting producers only, accounting for less than 10 % of all exports of the product under investigation.

• (36) After the Commission abandoned sampling, PTIA reiterated its arguments. It referred to several other investigations where the Commission chose more than two exporting producers or groups. PTIA argued that since the Commission had a statutory deadline of 14 months to complete the investigation, it still had enough time to include another company in the sample, and that the initial decision to investigate less than 10 % of exports was unusual considering that 120 companies provided a sampling reply.

• (37) The Commission duly considered all the comments submitted by PTIA. It recalled that the final decision on the selection of which and how many parties and coverage of types of products remained at the discretion of the Commission, and that based on the circumstances of the case, it did not consider it necessary to change or enlarge the sample. The Commission first recalled that the Chinese hardwood plywood industry was highly fragmented and that it was mostly composed of SMEs. More specifically, out of the 120 companies responding to the sampling form, more than 80 companies each represented less than 1 % of the estimated total volume of exports to the Union. Therefore, the initial sample of almost 10 % of exports was considered representative of the Chinese exports of hardwood plywood to the Union. The Commission also recalled that apart from the volume of exports, it took into account the most representative product mix ensuring that the sample was composed of companies exporting the most represented types hardwood plywood to the Union, being poplar, eucalyptus and birch. Considering this additional criterion, adding a third company to the sample would increase the representativeness of the sample by 3 % at most. Given that the initial sample represented already almost 10 % of exports to the Union and that it covered the most representative types of hardwood plywood, the Commission did not consider it necessary to enlarge the sample, and it considered that the sample was representative of the exports of the Chinese exporting producers to the Union.

• (38) The Commission also pointed out that two of the three sampled exporting producers did not cooperate, and that the only remaining cooperating exporting producer Jianghsan Wood represented 5,8 % of the total exports to the Union. Therefore, it concluded that, in accordance with Article 17(4) of the basic Regulation, the degree of non-cooperation would likely materially affect the outcome of the investigation, and that, at the same time, there was insufficient time to select a new sample. On this basis, it considered the decision to abandon sampling as justified.

• (39) The Commission furthermore recalled that the decision on whether or not there was sufficient time to include another exporting producer in the sample has to be assessed in light of the specific circumstances of each investigation. In this particular case, the Commission acted swiftly by replacing Xuzhou Shengfeng Wood Co., Ltd by Xuzhou Hongxin Wood Co., Ltd when the former decided not to cooperate. However, it only became clear that Xuzhou Hongxin Wood Co., Ltd did not cooperate by the deadline of 3 January 2025, almost three months after the investigation was initiated. Given that any new company to the sample would have to be given another at least 30 days to provide the questionnaire reply, the reply would have come more than two months after the initially provided deadline ⁸. It was thus considered that in view of procedural deadlines, there was not sufficient time to select a new company. The Commission thus rejected the claims.

1.6.   Questionnaire replies and verification visits

• (40) 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’).

• (41) Furthermore, the complainant provided in the complaint sufficient prima facie evidence of raw material distortions in the 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 the PRC. For this reason, the Commission sent additional questionnaires in this regard to the GOC.

• (42) The Commission sent questionnaires to all sampled Union producers, the complainant, the sampled unrelated importers and known users, and the sampled exporting producers. The same questionnaires were made available online ⁹ on the day of initiation.

• (43) The Commission sought and verified all the information deemed necessary for a provisional determination of dumping, resulting injury and Union interest. Verification visits pursuant to Article 16 of the basic Regulation were carried out at the premises of the following companies:

Union producers:

• — Garnica Plywood Group S.A., Logroño, Spain (‘Garnica’),

• — Paged Morąg S.A., Pisz, Poland (‘Paged’),

• — Panguaneta Spa, Sabbioneta, Italy, (‘Panguaneta’).

Exporting producer in the People’s Republic of China:

• — Jiangshan Wood.

1.7.   Investigation period and period considered

• (44) The investigation of dumping and injury covered the period from 1 July 2023 to 30 June 2024 (‘the investigation period’). The examination of trends relevant for the assessment of injury covered the period from 1 January 2021 to the end of the investigation period (‘the period considered’).

2. PRODUCT UNDER INVESTIGATION, PRODUCT CONCERNED AND LIKE PRODUCT

2.1.   Product under investigation

• (45) The product under investigation is hardwood plywood consisting solely of sheets of wood other than bamboo and okoumé, each ply not exceeding 6 mm thickness, with at least one outer ply of tropical wood or non-coniferous wood, of species specified under subheadings 4412 31 , 4412 33 and 4412 34 , whether or not coated or surface-covered (‘the product under investigation’).

• (46) Hardwood plywood is a multifunctional end product suitable for many different applications. It is commonly used in the following industries depending on the grade and other quality characteristics: construction, furniture manufacturing, transport, packaging and other, such us advertisement stands, coffins, traffic signs and indicators or toys.

2.2.   Product concerned

• (47) The product concerned is hardwood plywood originating in the People’s Republic of China.

2.3.   Like product

• (48) The investigation showed that the following products have the same basic physical chemical and technical characteristics as well as the same basic uses:

• — the product concerned when exported to the Union,

• — the product under investigation produced and sold on the domestic market of country concerned, and

• — the product under investigation produced and sold in the Union by the Union industry.

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

2.4.   Claims regarding product scope

• (50) PTIA submitted that the definition of the product scope was overly broad to include birch plywood because it is not produced by the complainants.

• (51) The Commission rejected the argument as several complainants, for example Welde A.G. and Garnica, produced birch plywood.

• (52) PTIA and China National Forest Products Industry Association (‘CNFPIA’) argued that coated and uncoated plywood are two separate products and cannot be covered by the same investigation, without however submitting detailed and verifiable information in support of their claims.

• (53) Accordingly, the Commission rejected the claim because the basic physical, chemical and technical characteristics of plywood manufactured of hardwood species remain the same or very similar irrespective of coating or the lack of it.

• (54) PTIA submitted that the definition of the product scope was inconsistent with the definition of the product scope in the anti-dumping investigation concerning imports of birch plywood from Russia ¹⁰. In that case, the Commission rejected the claim of a Russian exporting producer to include pine, poplar, okoumé and beech plywood in the product scope, because it determined that pine, poplar, okoumé and beech plywood do not share the same basic physical, technical and chemical characteristics with birch plywood.

• (55) The Commission found that the defining factor of the product under investigation in the present investigation was that the face veneer is made of hardwood, as opposed to softwood, other wood products or plastic. Hardwood plywood, as a general category, may be divided into different subcategories (product types) depending on the type of hardwood species, as shown in the investigation concerning imports of birch plywood from Russia ¹¹, but that does not mean that all panels with a hardwood plywood face veneer do not form a distinct and broader product category on its own. Additionally, in the anti-dumping investigation concerning imports of birch plywood from Russia, the Commission had found that there was a certain level of substitution between birch plywood and plywood made from other types of wood, such as poplar, pine and okoumé ¹². Hardwood plywood is, therefore, a broader category of product that can be distinguished from other products (for example, from softwood plywood) by its basic physical, technical and chemical characteristics, which also includes several subcategories (product types). In this regard, the Commission also noted that in the present investigation the product control number (‘PCN’) takes into consideration the different subcategories of hardwood plywood based on type of hardwood used as the face veneer.

• (56) The fact that, in 2019, the EU birch plywood producers, representing a part of the hardwood plywood industry, submitted a complaint regarding dumped imports from Russia injuring them, does not mean that in 2024, the entirety of the EU hardwood plywood industry cannot claim that they are being injured by dumped imports of all types of hardwood, including products made of birch plywood, from China. In light of the above, the Commission, therefore, rejected the claim.

• (57) PTIA, Altripan B.V. (‘Altripan’) and Polywood submitted that the Chinese hardwood plywood industry, on the one hand, and the Union hardwood plywood industry, on the other hand, occupy different market segments and are not in competition.

• (58) The Commission found that both industries can and do produce the full range of hardwood plywood products present in the Union market. The purported differences between Chinese and Union industry hardwood plywood are in quality only; their basic physical, technical and chemical characteristics remain the same. The existence of different market segments in which imported products and Union industry produced plywood were present was not demonstrated by interested parties in accordance with the relevant legal standard ¹³. The Commission, therefore, rejected the claim.

2.5.   Claims regarding product exclusion

• (59) PTIA, CNFPIA, German Timber Federation (GD Holz), the Belgian Federation of Textile, Wood and Furniture Industry (Fedustria), the European Timber Trade Federation (ETTF), Peri SE, Weltholz ZN, Enno Roggemann, J. u. A. Frischeis Gesellschaft and Questwood sp. z o.o (‘Questwood’) argued that film-faced plywood should be excluded from the product scope because the Union industry does not produce it and does not have sufficient capacity to produce it. The Union industry produces high-end film-faced plywood only which is not interchangeable with film-faced plywood imported from China.

• (60) The Commission found that both the Union industry and Chinese exporting producers offer film-faced plywood of different qualities. The differences in the use of film-faced plywood panels are due to their durability, i.e. the number of times they can be used for construction formwork, rather than any inherent variance in their basic physical, technical and chemical characteristics. Another strongly linked factor to quality is price difference. The lowest quality imported Chinese film-faced plywood is sold at a very low, dumped price. The Commission, however, did not find that the price difference annuls the interchangeability of imported and Union produced hardwood plywood panels. The claim, therefore, was rejected.

• (61) PTIA, CNFPIA and Questwood argued that eucalyptus plywood should be excluded from the product scope because the Union industry has a very limited possibility to produce it.

• (62) The Commission found that there is production of eucalyptus plywood in the EU in commercial volumes. Hence, the claim was rejected.

• (63) PTIA, GD Holz, ETTF, CNFPIA and Questwood argued that plywood with outer layers of 0,3 mm or less should be excluded from the product scope because Union producers use thicker outer layers.

• (64) The Commission found that the thickness of the face veneer is a quality difference impacting the durability and price of plywood panels. Plywood with thin veneers does not constitute a separate product type with differing basic physical, technical and chemical characteristics, nor does it compete in a different market segment than hardwood plywood panels made with thicker face veneers. The Commission, therefore, rejected the claim.

• (65) PTIA, GD Holz, ETTF, CNFPIA and Questwood argued that plywood with outer layers of engineered veneers should be excluded from the product scope because it is a special product that none of the complainants produce in meaningful commercial quantities.

• (66) The Commission found that the Union industry produced hardwood plywood with engineered face veneers, composed of cut-up and recomposed hardwood plies to form specific patterns, shares basic physical, technical and chemical characteristics and directly competes with similar hardwood plywood panels imported from China. The claim was, therefore, rejected.

• (67) CNFPIA and PTIA submitted that air-dried hardwood plywood with moisture content above 12 % should be excluded from the product scope because this high moisture content is the result of air drying that is widespread in China but no one in the Union produces air-dried veneers.

• (68) The Commission found that the quantity of moisture is a grading factor during the selection of veneers. High quality veneers contain lower levels of moisture. Low quality veneers have higher levels of moisture. While air drying may lead to higher moisture retention, some veneers that pass through industrial dryers may also retain a significant amount. Moisture content depends on several factors, and it cannot be attributed only to the method of drying. Accordingly, the Commission considered that hardwood plywood produced by the Union industry using industrial veneer dryers and hardwood plywood produced from air-dried veneers in China share basic physical, technical and chemical characteristics, and rejected the claim.

• (69) Houtwerf B.V. argued that hardwood plywood made with 100 % biobased glue should be excluded from the product scope because it is a special, environmentally friendly product that is not and cannot be produced in the Union.

• (70) The Commission found that several Union producers, such as Garnica or Paged, manufacture hardwood plywood products using bio-based glue. Hence, the claim was rejected.

• (71) PTIA, Linyi Donglin Wood Factory Limited and Vöhringer GmbH & Co argued that hardwood plywood of a thickness below 6 mm should be excluded from the product scope because this type of plywood is not produced in Europe and European plywood manufacturers are not interested in producing it.

• (72) The Commission found that thin plywood is produced by the Union industry. Namely, Panguaneta, among the sampled Union producers, produces thin poplar plywood. The Commission, therefore, rejected the claim.

• (73) Questwood argued that poplar plywood should be excluded from the product scope because poplar plywood produced in China is of a lower quality than European or Turkish products.

• (74) The Commission found that the alleged quality difference does not annul the fact that imported and Union produced poplar plywood share basic physical, technical and chemical characteristics. Therefore, the claim was rejected.

• (75) PTIA argued that hardwood plywood made of tropical species should be excluded from the product scope as the tropical species do not share the same essential characteristics with other plywood wood species.

• (76) The Commission found that tropical wood is mostly classified as hardwood, sharing the same basic physical, technical and chemical characteristics as other species in this wood classification category. The Commission, therefore, rejected the claim.

3. DUMPING

3.1.   Procedure for the determination of the normal value under Article 2(6a) of the basic Regulation

• (77) 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.

• (78) 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 hardwood plywood. Sixteen exporting producers submitted the relevant information.

• (79) 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. 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.

• (80) 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.

• (81) On 19 December 2024, the Commission informed, by a note to the file (‘the First Note’), interested parties 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 the hardwood plywood. In addition, based on the criteria guiding the choice of undistorted prices or benchmarks, the Commission identified possible representative countries, namely Brazil, Malaysia, Thailand and Türkiye.

• (82) On 11 March 2025, the Commission informed by a second note (‘the Second Note’) interested parties on the relevant sources it intended to use for the determination of the normal value, with Türkiye as the representative country. The comments on the First Note were addressed in the Second Note. The Commission also informed parties of its intention to select as the representative country Türkiye, and that it would establish SG & A and profits based on readily available information of five producers of plywood in Türkiye. The comments on the Second Note and the finally proposed sources of information to determine the normal value are detailed below in Section 3.2.2.

3.2.   Normal value

• (83) 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’.

• (84) 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’.

• (85) 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 decision to abandon the sampling, the application of Article 2(6a) of the basic Regulation was appropriate.

3.2.1.   Existence of significant distortions

3.2.1.1.   Introduction

• (86) Article 2(6a)(b) of the basic Regulation states that ‘significant distortions are those distortions which occur when reported prices or costs, including the costs of raw materials and energy, are not the result of free market forces as they are affected by substantial government intervention. In assessing the existence of significant distortions regard shall be had, inter alia, to the potential impact of one or more of the following elements:

• — the market in question being served to a significant extent by enterprises which operate under the ownership, control or policy supervision or guidance of the authorities of the exporting country;

• — state presence in firms allowing the state to interfere with respect to prices or costs;

• — public policies or measures discriminating in favour of domestic suppliers or otherwise influencing free market forces;

• — the lack, discriminatory application or inadequate enforcement of bankruptcy, corporate or property laws;

• — wage costs being distorted;

• — access to finance granted by institutions which implement public policy objectives or otherwise not acting independently of the state’.

• (87) 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.

• (88) However, any conclusion on significant distortions within the meaning of Article 2(6a)(a) of the basic Regulation must be made on the basis of all the evidence at hand. The overall assessment on the existence of distortions may also take into account the general context and situation in the exporting country, in particular where the fundamental elements of the exporting country’s economic and administrative set-up provide the government with substantial powers to intervene in the economy in such a way that prices and costs are not the result of the free development of market forces.

• (89) Article 2(6a)(c) of the basic Regulation provides that ‘[w]here the Commission has well-founded indications of the possible existence of significant distortions as referred to in point (b) in a certain country or a certain sector in that country, and where appropriate for the effective application of this Regulation, the Commission shall produce, make public and regularly update a report describing the market circumstances referred to in point (b) in that country or sector’.

• (90) Pursuant to this provision, the Commission issued a country report concerning the PRC ¹⁴ (‘Report’), which contains evidence of the existence of substantial government intervention at many levels of the economy, including specific distortions in many key factors of production (such as land, energy, capital, raw materials and labour), as well as selected sectors (such as the wood-based products sector). Interested parties were invited to rebut, comment or supplement the evidence contained in the investigation file at the time of initiation. The Report was placed on the investigation file at initiation.

3.2.1.2.   The complainant’s position on existence of significant distortions

• (91) The complainant argued that prices or costs of the product concerned, including the costs of raw materials, 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 and that, as a result, it is not appropriate to use domestic prices and costs to establish normal value.

• (92) To support this position, the complainant referred to the evidence contained in the Report, their own research, as well to findings in past Commission and the US authorities’ investigations.

• (93) In particular, the complainant pointed out the Commission’s previous findings on the Chinese economic system being based on the socialist market economy doctrine, on the leading role of the Communist Party’s of China (‘CCP’ or ‘Party’) and on the interventionist economic policy of the state.

• (94) Moreover, pointing out that the hardwood plywood industry is part of the Chinese forestry and wood products sectors, the complainant recalled the following elements pointing to the existence of significant distortions.

• (95) First, the hardwood plywood sector is being served to a significant extent by enterprises that operate under the ownership, control or policy supervision or guidance of state authorities:

• — As established in the okoumé plywood investigation ¹⁵, the GOC has a stake exceeding 40 % in Jiangsu High Hope Arser Co., Ltd. (‘Arser’), the largest exporter of hardwood plywood to the EU from the PRC ¹⁶. In that investigation, the Commission also found that State authorities in the PRC exert control and supervision over companies through informal channels, as evidenced by the ‘cultivation’ of privately owned Luli Group Co., Ltd., by the Shandong government ¹⁷. Moreover, the CCP has been intervening into the operations and decision-making processes of Chinese companies, including the private ones ¹⁸.

• — This is apparent also at the level of CNFPIA. According to Article 4 of CNFPIA’s Articles of Association, the organisation ‘accepts the professional guidance, supervision and management of […] the State Forestry and Grassland Administration and the Ministry of Civil Affairs’ ¹⁹.

• (96) Second, the state presence in hardwood plywood companies also allows the authorities to interfere with prices and/or costs:

• — Under the PRC's company law, every company must establish a CCP organization if it has at least three CCP members, as outlined in the CCP Constitution and the company shall provide the necessary conditions for the activities of the party organisation ²⁰. More recently, the CCP issued the Central Committee’s Guidelines on stepping up the United Front ²¹ (‘United Front Guidelines’) work in the private sector for the new era. The document aims to increase the CCP's role in private companies, encouraging to ‘further step up Party building in private enterprises and enable the Party cells to play their role effectively’ ²². These rules are also applicable to the Chinese hardwood plywood sector. In particular, the investigation in the okoumé plywood case found that top executives of Arser, hold dual roles, with the general manager being the Party branch secretary and the chairman being the Party committee secretary ²³.

• — Investigation by the complainant has confirmed the extent and significance of CCP presence in Chinese hardwood plywood firms, including two major producers, Luli Group Co., Ltd., and Zhejiang Yuhua Wood Industry, which were founded by and have CCP members as key shareholders ²⁴.

• — The pervasiveness of state presence in the hardwood plywood value chain is further evidence of the GOC’s ability to interfere in that industry with respect to prices and costs, not least given its presence and intervention in the Chinese financial markets and in the provision of raw materials.

• (97) Third, the GOC pursues public policies or measures discriminating in favour of domestic suppliers or otherwise influencing free market forces:

• — In addition to a complex system of industrial planning affecting all economic activities, other relevant public policies including procurement rules are being regularly used in pursuit of policy goals other than economic efficiency.

• — Chinese authorities have enacted policies to guide the plywood sector ²⁵, including listing wooden panel-related technologies as encouraged industries in the Guiding Catalogue for industry structural adjustment of 2019 ²⁶.

• — Products and sectors relating to hardwood plywood, such as wood-based panels, wood flooring, and wood furniture, are featured prominently in the PRC’s 14th Five-Year-Plan on the Development of the Forest and Grassland Industry (2021-2025) ²⁷ (‘14th Forest FYP’). Furthermore, as noted in the okoumé plywood case and based on the original Chinese version of the document, the 14th Forest FYP sets specific output targets for these markets: ‘[b]y 2025 […] the output of man-made panels will be stabilized at about 300 million cubic meters, the output of flooring will be stabilized at about 800 million square meters, and the output value of wooden furniture will exceed RMB 800 billion’ ²⁸.

• — The Chinese forestry and grass industry is also subject of a 2019 Guiding Opinion by the National Administration for Forestry and Grassland (‘NAFG’), which laid down parameters for the sector’s planned development: ‘[b]y 2025, […] the supporting capacity of forest and grass resources will be significantly enhanced, […] and the import and export trade volume of forest products shall reach 240 USD billion’ ²⁹.

• — A 2016 study from the Chinese Academy of Forestry refers to a longstanding ‘going overseas’ policy, aimed at procuring forest resources from Latin America, Southeast Asia, and Africa to promote the international penetration of the Chinese plywood industry ³⁰.

• (98) Fourth, much like in other sectors of the Chinese economy, the hardwood plywood sector is subject to the distortions resulting from the discriminatory application or inadequate enforcement of bankruptcy, corporate and property laws:

• — The Commission established in the glass fibre fabrics case existence of distortions resulting from discriminatory application of relevant legislation, in particular when it comes to insolvency and land use rights allocation ³¹.

• — In the okoumé plywood case, the Commission noted that the shortcomings of the PRC’s system of property rights are particularly apparent in the context of both the country’s land-ownership and land-use rights ³².

• — Moreover, since China’s forest management is under the jurisdiction of the NAFG, the authority is responsible for developing policies for the allocation of forestry and grassland resources and the utilization of timber and it oversees the approval of all timber processing activities in the country ³³.

• — Finally, a 2016 study from the Chinese Academy of Forestry found that state-owned forests constituted the main origin for the raw materials used by plywood companies ³⁴.

• (99) Fifth, wage costs are distorted in the hardwood plywood sector as well:

• — The Commission found previously that a system of market-based wages cannot fully develop in the PRC as workers and employers are impeded in their rights to collective organisation. Only a single union organisation is active in the PRC, but it lacks independence from the state ³⁵.

• — In addition, the mobility of the Chinese workforce is restricted by the household registration system. This typically results in workers who are not in possession of the local residence registration finding themselves in a vulnerable employment position and receiving lower wages than those who are holders of the residence registration ³⁶.

• (100) Sixth, producers in the hardwood plywood sector have access to finance granted by institutions which implement public policy objectives or otherwise are not acting independently from the state:

• — Banks remain connected to the state not only through ownership but also by personal relations. Notably, the top executives of large state-owned financial institutions are ultimately appointed by the CCP ³⁷.

• — The financial institutions in the PRC operate under rules that direct finances into sectors designated by the government as encouraged or otherwise important ³⁸. This situation results in a bias in favour of lending to SOEs, large, well-connected private firms and firms in key industrial sectors, which means that the availability and cost of capital is not equal for all players in the market ³⁹.

• — Moreover, the US authorities concluded that the GOC uses ‘loans to encourage and support the growth of favoured industries, including those using timber, which would include the hardwood plywood industry’ ⁴⁰.

• (101) In conclusion, the complainant argued that there is prima facie evidence of significant distortions pursuant to Article 2(6a) of the basic Regulation are present in the hardwood plywood sector.

3.2.1.3.   The Commission’s findings

• (102) The Commission examined whether it was appropriate or not to use domestic prices and costs in the PRC, due to the existence of significant distortions within the meaning of point (b) of Article 2(6a) of the basic Regulation. The Commission did so on the basis of the evidence available on the file.

• (103) The Commission’s analysis covered the examination of the substantial government interventions in the PRC’s economy in general, but also the specific market situation in the relevant sector including the product concerned. The Commission further supplemented these evidentiary elements with its own research on the various criteria relevant to confirm the existence of significant distortions in the PRC.

• (104) The Chinese economic system is based on the concept of a ‘socialist market economy’. That concept is enshrined in the Chinese Constitution and determines the economic governance of the PRC. The core principle is the ‘socialist public ownership of the means of production, namely, ownership by the whole people and collective ownership by the working people’ ⁴¹.

• (105) The state-owned economy is the ‘leading force in the national economy’ and the state has the mandate to ensure its ‘consolidation and growth’ ⁴². Consequently, the overall setup of the Chinese economy not only allows for substantial government interventions into the economy, but such interventions are expressly mandated. The notion of supremacy of public ownership over the private one permeates the entire legal system and is emphasized as a general principle in all central pieces of legislation.

• (106) The Chinese property law is a prime example: it refers to the primary stage of socialism and entrusts the state with upholding the basic economic system under which the public ownership plays a dominant role. Other forms of ownership are tolerated, with the law permitting them to develop side by side with the state ownership ⁴³.

• (107) In addition, under Chinese law, the socialist market economy is developed under the leadership of the CCP. The structures of the Chinese state and of the CCP are intertwined at every level (legal, institutional, personal), forming a superstructure in which the roles of CCP and the state are indistinguishable.

• (108) Following an amendment of the Chinese Constitution in March 2018, the leading role of the CCP was given an even greater prominence by being reaffirmed in the text of Article 1 of the Constitution.

• (109) Following the already existing first sentence of the provision: ‘[t]he socialist system is the basic system of the People’s Republic of China’ a new second sentence was inserted which reads: ‘[t]he defining feature of socialism with Chinese characteristics is the leadership of the Communist Party of China’ ⁴⁴. This illustrates the unquestioned and ever-growing control of the CCP over the economic system of the PRC.

• (110) This leadership and control is inherent to the Chinese system and goes well beyond the situation customary in other countries where the governments exercise general macroeconomic control within the boundaries of which free market forces are at play.

• (111) The Chinese state engages in an interventionist economic policy in pursuance of goals, which coincide with the political agenda set by the CCP rather than reflecting the prevailing economic conditions in a free market ⁴⁵. The interventionist economic tools deployed by the Chinese authorities are manifold, including the system of industrial planning, the financial system, as well as the level of the regulatory environment.

• (112) First, on the level of overall administrative control, the direction of the Chinese economy is governed by a complex system of industrial planning which affects all economic activities within the country. The totality of these plans covers a comprehensive and complex matrix of sectors and crosscutting policies and is present on all levels of government.

• (113) Plans at provincial level are detailed while national plans set broader targets. Plans also specify the means in order to support the relevant industries/sectors as well as the timeframes in which the objectives need to be achieved. Some plans still contain explicit output targets.

• (114) Under the plans, individual industrial sectors and/or projects are being singled out as (positive or negative) priorities in line with the government priorities and specific development goals are attributed to them (industrial upgrade, international expansion, etc.).

• (115) The economic operators, private and state-owned alike, must effectively adjust their business activities according to the realities imposed by the planning system. This is not only because of the binding nature of the plans, but also because the relevant Chinese authorities at all levels of government adhere to the system of plans and use their vested powers accordingly, thereby inducing the economic operators to comply with the priorities set out in the plans ⁴⁶.

• (116) Second, on the level of allocation of financial resources, the financial system of the PRC is dominated by the state-owned commercial and policy banks. Those banks, when setting up and implementing their lending policy need to align themselves with the government’s industrial policy objectives rather than primarily assessing the economic merits of a given project ⁴⁷.

• (117) The same applies to the other components of the Chinese financial system, such as the stock markets, bond markets, private equity markets etc. Also, these parts of the financial sector are institutionally and operationally set up in a manner not geared towards maximizing the efficient functioning of the financial markets but towards ensuring control and allowing intervention by the state and the CCP ⁴⁸.

• (118) Third, on the level of regulatory environment, the interventions by the state into the economy take a number of forms. For instance, the public procurement rules are regularly used in pursuit of policy goals other than economic efficiency, thereby undermining market-based principles in the area. The applicable legislation specifically provides that public procurement shall be conducted in order to facilitate the achievement of goals designed by state policies. However, the nature of these goals remains undefined, thereby leaving broad margin of appreciation to the decision-making bodies ⁴⁹.

• (119) Similarly, in the area of investment, the GOC maintains significant control and influence over destination and magnitude of both state and private investment. Investment screening as well as various incentives, restrictions, and prohibitions related to investment are used by authorities as an important tool for supporting industrial policy goals, such as maintaining state control over key sectors or bolstering domestic industry ⁵⁰.

• (120) In sum, the Chinese economic model is based on certain basic axioms, which provide for and encourage manifold government interventions. Such substantial government interventions are at odds with the free play of market forces, resulting in distorting the effective allocation of resources in line with market principles ⁵¹.

Significant distortions according to Article 2(6a)(b), first indent of the basic Regulation: the market in question being served to a significant extent by enterprises which operate under the ownership, control or policy supervision or guidance of the authorities of the exporting country

• (121) In the PRC, enterprises operating under the ownership, control and/or policy supervision or guidance by the state represent an essential part of the economy.

• (122) While in the hardwood plywood sector, the degree of state ownership does not appear to be significant, the GOC maintains shareholding in a number of economic operators within the sector, such as in Guangxi Forestry Group Co., Ltd., ‘a large-scale state-owned enterprise directly under the People's Government of the [Guangxi] Autonomous Region’ ⁵²; in the trading company SUMEC Group Corporation (‘SUMEC’) a subsidiary of SINOMACH, ‘a state-owned backbone enterprise under the direct control of the central government’ ⁵³; or in Arser ⁵⁴ which was founded as a trading company but which ‘[i]n recent years, under the guidance of Jiangsu Provincial State-owned Assets Supervision and Administration Commission […] established its business development strategy of upstream and downstream extension of the industrial chain and integrated operation of the supply chain, and strived to build itself into an integrated operation service provider for the entire industrial chain of the timber industry’ ⁵⁵. Beyond formal ownership, state authorities can control and supervise companies through informal channels, as illustrated by the privately owned Luli Group Co., Ltd. which, according to public sources, has been ‘cultivated’ by the Shandong province government ⁵⁶. Similarly, even a smaller scale producer Feiya Wood Industry, referred to also by the complainant, complies with the CCP’s expectations to the extent that its general manager was awarded the honorary title of ‘outstanding private entrepreneur’ by the CCP Xuzhou Municipal Committee and the Xuzhou Municipal People's Government ⁵⁷.

• (123) In addition, given that CCP interventions into operational decision making have become the norm also in private companies ⁵⁸, with CCP claiming leadership over virtually every aspect of the country’s economy, the influence of the state by means of CCP structures within companies effectively results in economic operators being under control and policy supervision of the government.

• (124) Moreover, the hardwood plywood sector is subject to several government policies, as the wood processing sector has been listed as an encouraged industry both in the 2019 Guiding Catalogue for Industry Structural Adjustment ⁵⁹, as well as in its 2024 updated version ⁶⁰. Additionally, both versions of the catalogue list the ‘plywood and blockboard production lines with a capacity of less than 10 000 cubic meters per year’ as a restricted industry which effectively amounts to governmental guidance in favour of large-scale producers ⁶¹.

• (125) Similarly, the 14th Forest FYP sets the following objectives: ‘Encourage the development, application and promotion of new environmentally friendly adhesives, and gradually increase the proportion of low-formaldehyde and formaldehyde-free wood processing products. […] Accelerate the development of emerging industries such as customized home furnishings, wood structures and wood building materials, […] By 2025, the output of wood-based panels will stabilize at around 300 million cubic meters.’

• (126) Government control and policy supervision can be also observed at the level of the relevant industry associations ⁶². For instance, CNFPIA states in Article 3 of its Articles of Association that the organisation ‘accepts the business guidance, supervision and management by the entities in charge of registration and management, by the entities in charge of Party building, as well as by the relevant administrative departments in charge of industry management’ ⁶³.

• (127) Arser is a member of the CNFPIA and was selected as a demonstration company member for some of CFPIA’s activities ⁶⁴.

• (128) Luli Group Co., Ltd. is a member of the CFPIA and was selected as a benchmark company member for some CFPIA’s activities ⁶⁵.

• (129) Similarly, the China Timber and Wood Products Distribution Association (‘CTWPDA’) also states in Article 3 of its Articles of Association that the organisation ‘accepts the business guidance, supervision and management by the entities in charge of registration and management, by the entities in charge of Party building, as well as by the relevant administrative departments in charge of industry management’ ⁶⁶ and presents itself as an ‘association subject to the administration of the Ministry of Civil Affairs and the supervision and guidance of the State-Owned Asset Supervision and Administration Commission of the State Council […]’ ⁶⁷.

• (130) Luli Group Co., Ltd. is a member of CTWPDA ⁶⁸. Consequently, even privately owned producers in the sector of the product concerned are prevented from operating under market conditions. Indeed, both public and privately owned enterprises in the sector are subject to policy supervision and guidance.