Commission Implementing Regulation (EU) 2025/1189 of 13 June 2025 imposing provisional anti dumping duties on imports of screws without heads originating in the People’s Republic of China

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	2025/1189	16.6.2025

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 17 October 2024, the European Commission (‘the Commission’) initiated an anti-dumping investigation with regard to imports of screws without heads (‘screws’) originating in People’s Republic of China (‘China’) 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 2 September 2024 by the European Industrial Fasteners Institute (‘the complainant’). The complaint was made on behalf of the Union industry of screws without heads 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 the product concerned subject to registration by Commission Implementing Regulation (EU) 2025/141 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) Apart from the comments on the product scope explained in the Section 2.4 below, no other comments were made on initiation.

1.5.   Sampling

• (7) 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

• (8) In its Notice of Initiation, the Commission stated that it had provisionally selected a sample of Union producers. The Commission selected the sample on the basis of of largest production and sales volume of the various product types falling within the scope of the like product in the Union between 1 July 2023 and 30 June 2024, taking into account the geographical spread. This sample consisted of three Union producers. The sampled Union producers accounted for around 14 % of production and sales volume of the Union industry. The Commission invited interested parties to comment on the provisional sample. No comments were received. The sample is representative of the Union industry.

Sampling of unrelated importers

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

• (10) Eight 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. 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

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

• (12) One hundred twenty-seven exporting producers in China provided the requested information and agreed to be included in the sample. In accordance with Article 17(1) of the basic Regulation, the Commission selected a sample of three exporting producers on the basis of the largest representative volume of exports to the Union which could reasonably be investigated within the time available. In accordance with Article 17(2) of the basic Regulation, all known exporting producers concerned and the authorities of China were consulted on the selection of the sample.

• (13) Following a comment from a non-sampled exporting producer arguing that one of the companies selected to be in the sample was a trading company rather than an exporting producer, the Commission verified with the sampled company whether that information was correct. Having confirmed the company was indeed a trader, the Commission decided to revise the sample replacing this company with another exporting producer.

• (14) The newly selected exporting producer informed the Commission of its decision not to cooperate in the investigation and submit the questionnaire reply. Consequently, the Commission informed this exporting producer that it considered the failure to reply to the questionnaire as non-cooperation in accordance with Article 18 of the basic Regulation.

• (15) As a result, the Commission revised the sample a second time and selected a third exporting producer as part of the final sample to replace the non-cooperating producer mentioned in recital (14).

• (16) For both revisions of the sample, the Commission applied the same criterion used for the selection of the initial sample, i.e. the largest representative volume of exports to the Union during the investigation period which could reasonably be investigated within the time available.

1.6.   Individual examination

• (17) No exporting producers in China requested individual examination under Article 17(3) of the basic Regulation.

1.7.   Request for anonymity

• (18) Most of the Union producers that were either represented by the complainant, or supporters of the complaint requested to obtain anonymity treatment in order to prevent possible retaliatory actions by customers in the Union that also sourced headless screws from Chinese suppliers. These customers included some large companies with significant market power compared to the Union producers of headless screws that are mostly SMEs. Considering the asymmetry between the Union headless screws producers and users, it concluded that the risk of retaliation alleged by the Union producers represented by EIFI and supporters indeed existed. On this basis, the Commission granted confidential treatment to the name of these companies.

1.8.   Questionnaire replies and verification visits

• (19) The Commission sent a questionnaire concerning the existence of significant distortions in China within the meaning of Article 2(6a)(b) of the basic Regulation to the Government of the People’s Republic of China (‘GOC’).

• (20) The Commission sent questionnaires to the Union producers, importers and exporting producers. The same questionnaires were made available online ⁴ on the day of initiation.

• (21) 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:

• — Company 1, Italy,

• — Company 9, France,

• — Company 14, Spain.

Exporting producers in China:

• — Zhejiang Junyue Standard Part Co., Ltd., Yucheng Town Industrial Park, Haiyan County, China (‘Junyue’),

• — Chinafar Group, including:

• — Jiaxing Chinafar Standard Parts Co., Ltd., Jiaxing, Zhejiang, China (‘Chinafar’), and

• — Jiangsu Zhe Fasteners Co., Ltd., Yancheng, Jiangsu, China (‘Zhe Fasteners’).

• — Brother Group, including:

• — Jiaxing High-enter Fasteners Co.,Ltd., Jiaxing, Zhejiang, China (‘High-enter’),

• — Zhejiang Morgan Brother Technology Co., Ltd., Jiaxing, Zhejiang, China (‘Morgan Brother’), and

• — Jiaxing Brother Standard Part Co., Ltd., Jiaxing, Zhejiang, China (‘Brother Standard’).

1.9.   Investigation period and period considered

• (22) 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

• (23) The product under investigation is screws and bolts, whether or not with their nuts and washers, without heads, of iron or steel other than stainless steel, regardless of tensile strength, excluding coach screws and other wood screws, screw hooks and screw rings, self-tapping screws, and screws and bolts for fixing railway track construction material (‘the product under investigation’).

• (24) All screws without heads, namely threaded rods, anchor bolts and U-bolts are used to mechanically join two or more elements. They are used by a variety of consumer industries and in a wide range of final applications, including automotive, renewable energy, electrical appliances, agriculture, mechanical industry in general, and building.

2.2.   Product concerned

• (25) The product concerned is the product under investigation originating in the People’s Republic of China, currently falling under CN codes 7318 15 42 and 7318 15 48 .

2.3.   Like product

• (26) 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 and other third countries by the Union industry.

• (27) 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

2.4.1.   Anchor bolt cages

• (28) Manufacturers of Foundation Bolts and Anchor Bolt Cages from the European Wind Energy Sector requested that anchor bolt cages were included in the product scope of the investigation.

• (29) The Commission noted however that these products were not covered by the product definition, as set out in recital (23), neither in the complaint of this case and therefore no evidence of dumping and resulting injury justifying an investigation has been provided by the Union industry. The claim was therefore rejected.

• (30) One importer, GebuVolco, claimed that hanger bolts should be excluded from the product scope of the investigation. They argued that hanger bolts are:

• — specific products with torx recess in the metrical side and hexagon in the middle of the two different threads,

• — there was no manufacturer in the Union that could produce the required quantity and quality hanger bolts,

• — the use of hanger bolts are decreasing in the Union.

• (31) The Commission considered that hanger bolts have similar physical and technical characteristics as other screws. The complainant confirmed that the Union industry had capacity to produce hanger bolts. The Commission found at least one Union producer indicating the production of hanger bolts ⁵. Furthermore, the importer did not substantiate its claim on why the Union industry was incapable of producing hanger bolts of adequate quality. This claim was therefore rejected.

3. DUMPING

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

• (32) 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 China, 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.

• (33) 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 China to provide information regarding the inputs used for producing screws. Thirty-eight exporting producers submitted the relevant information.

• (34) 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 5.2 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)(a) 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.

• (35) No questionnaire reply was received from the GOC and no submission on the application of Article 2(6a) of the basic Regulation was received within the deadline. Subsequently, the Commission informed the GOC that it would use facts available within the meaning of Article 18 of the basic Regulation for the determination of the existence of the significant distortions in China.

• (36) In the Notice of Initiation, the Commission also specified that, in view of the evidence available, it may need to select 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.

• (37) On 5 March 2025, the Commission informed by a note (‘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 screws. In addition, based on the criteria guiding the choice of undistorted prices or benchmarks, the Commission identified possible representative countries, namely Malaysia, Thailand, and Türkiye.

• (38) The Commission received comments on the First Note from Chinafar Group, Junyue, Brother Group and the European Fasteners Distributor Association (‘EFDA’). The complainant provided comments on these interested parties’ submissions.

• (39) On 4 April 2025, the Commission addressed the comments received from interested parties on the First Note by a second note (‘the Second Note’) and informed interested parties on the relevant sources it intended to use for the determination of the normal value, with Thailand as the representative country. It also informed interested parties that it would establish selling, general and administrative costs (‘SG & A’) and profits based on readily available financial data of three Thai fasteners’ producers, sourced from the Orbis database.

• (40) The Commission received comments on the Second Note from Chinafar Group, Junyue, and EFDA. The complainant provided comments on these interested parties’ submissions. All comments are addressed in Section 3.2.2 and Section 3.2.3 below.

• (41) Having established the existence of significant distortions within the meaning of point (b) of Article 2(6a) of the basic Regulation, as explained in Section 3.2.1 below, and having analysed the comments and information received, the Commission concluded that Thailand was an appropriate representative country from which undistorted prices and costs would be sourced for the determination of the normal value. The underlying reasons for that choice are described in detail in Section 3.2.2 below.

3.2.   Normal value

• (42) 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’.

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

• (44) As further explained below, the Commission concluded in the present investigation that, based on the evidence available, the application of Article 2(6a) of the basic Regulation was appropriate.

3.2.1.   Existence of significant distortions

• (45) In recent investigations concerning the iron and steel sector in the PRC ⁶, the Commission found that significant distortions in the sense of Article 2(6a)(b) of the basic Regulation were present.

• (46) In those investigations, the Commission found that there is substantial government intervention in the PRC resulting in a distortion of the effective allocation of resources in line with market principles ⁷. In particular, the Commission concluded that in the steel sector, which is the main raw material to produce the product under investigation, not only does a substantial degree of ownership by the GOC persist in the sense of Article 2(6a)(b), first indent of the basic Regulation ⁸, but the GOC is also in a position to interfere with prices and costs through State presence in firms in the sense of Article 2(6a)(b), second indent of the basic Regulation ⁹. The Commission further found that the State’s presence and intervention in the financial markets, as well as in the provision of raw materials and inputs have an additional distorting effect on the market. Indeed, overall, the system of planning in the PRC results in resources being concentrated in sectors designated as strategic or otherwise politically important by the GOC, rather than being allocated in line with market forces ¹⁰. Moreover, the Commission concluded that the Chinese bankruptcy and property laws do not work properly in the sense of Article 2(6a)(b), fourth indent of the basic Regulation, thus generating distortions in particular when maintaining insolvent firms afloat and when allocating land use rights in the PRC ¹¹. In the same vein, the Commission found distortions of wage costs in the steel sector in the sense of Article 2(6a)(b), fifth indent of the basic Regulation ¹², as well as distortions in the financial markets in the sense of Article 2(6a)(b), sixth indent of the basic Regulation, in particular concerning access to capital for corporate actors in the PRC ¹³.

• (47) Like in previous investigations concerning the steel sector in the PRC, the Commission examined in the present investigation 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, including the evidence contained in the complaint, as well as in the Commission Staff Working Document on Significant Distortions in the Economy of the People’s Republic of China for the Purposes of Trade Defence Investigations ¹⁴ (‘Report’), which relies on publicly available sources. That 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 under investigation. 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 as also found by its previous investigations in this respect.

• (48) The complaint provided examples of elements pointing to the existence of distortions, as listed in the first to sixth indent of Article 2(6a)(b) of the basic Regulation, and alleged that market conditions, in particular costs and prices, in Chinese steel industry are not driven by market forces of supply and demand, but instead are distorted by State intervention in the economy.

• (49) The complaint referred to previous anti-dumping investigations concerning the steel industry, and in particular the investigation into the fasteners industry, where the Commission established that the Chinese industry is heavily distorted and therefore, the prices and costs in the PRC could not constitute a proper basis for establishing the normal value ¹⁵.

• (50) The complaint provided also references to the relevant parts of the Report, and pointed out in particular that:

• (51) State presence in firms allows the State to interfere with respect to prices and costs. The Chinese economic system is based on the concept of a socialist market economy, the core principle of which is the socialist public ownership of the means of production, namely, ownership by the whole people and collective ownership by the working people. The socialist market economy is developed under the leadership of the Chinese Communist Party (‘CCP’) and the structures of the State and those of the CCP are intertwined at every level. The Chinese State also engages in an interventionist economic policy in pursuance of goals that coincide with the political agenda set by the CCP rather than reflecting the prevailing economic conditions in a free market. Specifically in the steel sector, which is the source of the main raw material used to produce the product under investigation, a substantial degree of ownership by the GOC persists and, as a result, the GOC is also in a position to interfere with prices and costs through State presence.

• (52) The steel market, including the product under investigation, is served to a significant extent by enterprises which operate under the ownership, control or policy supervision or guidance of the GOC. The complaint indicated that specifically in the sector under investigation both public and privately owned enterprises are subject to policy supervision and guidance. Moreover, it mentioned the Commission investigation regarding fasteners, where it was found that ‘while the fasteners industry is very fragmented and consists mostly of SMEs, the investigation revealed connections between the party and the fastener industry associations, which group and represent the fastener producers’ ¹⁶.

• (53) Public policies or measures discriminate in favour of domestic suppliers or otherwise influence free market forces. Overall, in the PRC the system of planning results in resources being driven to sectors designated as strategic or politically important to the GOC, rather than being allocated by market forces. As such, the production of the product under investigation is considered as a strategic industry for the Chinese economy and is subject to significant incentives and subsidies. The complaint also reiterated that the steel industry benefits from the GOC’s consistent intervention, starting at the sector’s roots (i.e. the steelmaking raw materials market), resulting in a sector permeated by unfair and artificial advantages originating from the distorted mechanisms of price formation.

• (54) There is a lack and discriminatory application or inadequate enforcement of bankruptcy, corporate or property laws, thereby generating distortions when keeping insolvent firms afloat and when allocating land use rights in the PRC. The complaint referred in this regard to the Commission’s conclusions in previous investigations and argued that these conclusions would equally apply to the Chinese producers of screws without heads.

• (55) Wage costs are distorted. The complaint referred to the Commission’s conclusions in previous investigations and argued that these conclusions would equally apply to the Chinese producers of screws without heads.

• (56) Access to finance for corporate actors is affected by significant distortions resulting from the continuing pervasive role of the State in the capital markets. The complaint argued that in the Commission’s previous investigation in the fasteners sector, the Chinese producers were found to have benefitted from state financial incentive programmes and subsidies. In relation to the steel sector, the complaint referred to the Report highlighting specifically the impact of the financial system in China on the steel sector and the state support measures for the steel sector.

• (57) In conclusion, the complainant considered that, due to these distortions from substantial government intervention, the costs and prices in China are not reliable for the purpose of determining the normal value. As such, the normal value should be established by using non-distorted production costs in an appropriate representative country.

• (58) The Commission’s investigation confirmed that in the sector of the product under investigation, which is part of the downstream steel sector, a substantial degree of ownership by the GOC persists in the sense of Article 2(6a)(b), first indent of the basic Regulation. For instance, Zhejiang Metals & Minerals Holdings Co., a producer and exporter of the product under investigation, is controlled by Zhejiang International Trade Group, an SOE ¹⁷. Moreover, this sector is a sub-sector of fasteners and the findings concerning State ownership in the fasteners investigation having led to the adoption of Implementing Regulation (EU) 2022/191 (the ‘fasteners investigation’) are therefore relevant for screws without heads ¹⁸. The fasteners case referred specifically to the steel sector, which is the main raw material to produce fasteners, and therefore screws without heads. In the Chinese steel sector, a substantial degree of ownership by the GOC persists. Many of the largest steel producers are owned by the State. Examples of SOEs active in the steel sector include: the Ansteel Group ¹⁹ and the Baowu Steel Group ²⁰, which are both SOEs under the central State-owned Assets Supervision and Administration Commission of the State Council (‘SASAC’); the Baotou Steel Group, an SOE owned by the Inner Mongolian Government ²¹; as well as the Shougang Group ²², an SOE wholly owned by the Beijing State-Owned Asset Management Ltd ²³.

• (59) Furthermore, the latest Chinese policy documents concerning the steel sector confirm the continued importance which the GOC attributes to the sector, including the intention to intervene in the sector to shape it in line with government policies. This is exemplified by the Ministry of Industry and Information Technology (‘MIIT’) Guiding Opinion on Fostering a High-Quality Development of the Steel Industry, which calls for further consolidation of the industrial foundation and significant improvement in the modernization level of the industrial chain ²⁴, including the supply of special steel, an input used to produce the product under investigation. Specifically, this Guiding Opinion requires to ‘[p]romote mergers and reorganizations of enterprises. Encourage leading enterprises in the industry to implement mergers and reorganizations and create a number of world-class super-large steel enterprise groups. Relying on the industry’s dominant enterprises, cultivate 1 to 2 specialized leading enterprises in the fields of stainless steel, special steel, […].’ Further, it explicitly requires to ‘[S]upport steel companies to target the upgrading of downstream industries and the development direction of strategic emerging industries, focus on the development of small batches and multiple varieties of key steels such as high-quality special steels, special alloy steels for high-end equipment, and steel for core basic parts’ ²⁵.

• (60) Another example of the GOC’s intention to intervene in the steel sector can be found in the 14th Five-Year Plan on Developing the Raw Material Industry (‘14th FYP’) according to which the sector will ‘adhere to the combination of market leadership and government promotion’ and will ‘cultivate a group of leading companies with ecological leadership and core competitiveness’ ²⁶.

• (61) Additionally, the MIIT 2023 Work Plan on the Stable Growth of the Steel Industry ²⁷ sets the following objectives: ‘In 2023, […] the investment in fixed assets in the entire industry shall maintain a steady growth, and the economic benefits shall be significantly improved; the industry’s R&D investment shall eventually reach 1,5 %; the industry’s added value growth shall reach about 3,5 %; in 2024, the industry development environment and industry structure shall be further optimized, the move towards high-end, intelligent, and green products shall continue, and the industry added value growth shall exceed 4 %’. This Plan also foresees government mandated corporate consolidation of the steel sector: „[e]ncourage industry-leading enterprises to implement mergers and acquisitions, build world-class super-large iron and steel enterprise groups, and foster the optimal layout of national iron and steel production capacity. Support specialized enterprises with leading power in particular steel market segments to further integrate resources and create a steel industry ecosystem. Encourage iron and steel enterprises to carry out cross-regional […] mergers and reorganizations […]. Consider giving greater policy support for capacity replacement to iron and steel enterprises that have completed substantive mergers and reorganizations’.

• (62) Similar examples of the GOC’s intention to supervise and guide the developments of the steel sector can be seen at the provincial level, such as in Hebei where the provincial government released the Three-Year Action Plan on Cluster Development in the Steel Industry Chain in 2020. This plan requires to ‘steadily implement the group development of organizations, accelerate the reform of mixed ownership of state-owned enterprises, focus on promoting the cross-regional merger and reorganization of private iron and steel enterprises, and strive to establish 1-2 world-class large groups, 3-5 large groups with domestic influence’ ²⁸. Moreover, Hebei’s plan in the steel sector states the following objectives: ‘Adhere to structural adjustment and highlight product diversification. Unswervingly promote the structural adjustment and layout optimization of the iron and steel industry, promote the consolidation, reorganization, transformation and upgrading of enterprises, and comprehensively promote the development of the iron and steel industry in the direction of large-scale enterprises, modernization of technical equipment, diversification of production processes, and diversification of downstream products’ ²⁹ .

• (63) More specifically as regards the inputs used to produce the product under investigation, Hebei’s Plan requires to ‘[a]ccelerate the development and application of high-end and key new steel materials, increase the proportion of high-quality and special steel varieties, strengthen the quality stability of large-scale and wide-ranging advantageous products, and create a “pyramid” product structure. By the end of 2020, the proportion of ordinary low-alloy steel and alloy steel will be increased to 20 %, and by the end of 2022, it will reach about 25 %, providing support and guarantee for the upgrading of downstream industries’ ³⁰.

• (64) Likewise, the Henan Implementation Plan for the Transformation and Upgrade of the Steel Industry during the 14th FYP requires to ‘focus on national strategic needs, guide enterprises to promote the optimization and upgrading of product structure, develop high-quality special steel, high-performance marine engineering steel, special alloy steel for high-end equipment, core basic parts steel and other “special, fine, high” key varieties, and enhance the added value and competitiveness of steel products’ ³¹.

• (65) Similar industrial policy objectives can also be found in the planning documents of other provinces, such as Jiangsu ³², Shandong ³³, Shanxi ³⁴ or Zhejiang ³⁵.

• (66) In this regard, another example of effective steering by the GOC through the plans is the Notice of the Ansteel Group Co., Ltd.’s Party Committee on conscientiously studying, publicising and implementing the spirit of the Party’s 20th National Congress ³⁶. The notice claims that the Ansteel Group will conscientiously implement the guiding plans and better introduce them to Party members, cadres and employees of the entire group.

• (67) As to the GOC being in a position to interfere with prices and costs through State presence in firms in the sense of Article 2(6a)(b), second indent of the basic Regulation, the investigation confirmed that overlaps between managerial positions and CCP membership/Party functions exist also in the sector under investigation. For instance, the Chairman of the Zhejiang International Trade Group, controlling the Zhejiang Metals & Minerals Holdings Co., which is a producer and exporter of screws without heads, also serves as the Secretary of the Party Committee ³⁷. Still, as established in the fasteners investigation, the sector is very fragmented and mostly consists of SMEs hence it was not possible for the Commission to find extensive information on each producer. However the existence of personal connections between producers of the product under investigation and the CCP was established at the level of industry associations. The fastener industry associations underline their personal connection to the CCP, for example the Articles of Association of the Ningbo Fasteners Industry Association require that: ‘The president, vice president and secretary-general of this association must meet the following conditions: (1) Adhere to the party’s line, principles, policies, and be of a good political quality’ ³⁸.

• (68) Additionally, given that the product under investigation represents a sub-sector of the steel sector, the information available with respect to steel producers is relevant also to the product under investigation.

• (69) For instance, the Chairman of the Board of Directors and the General Manager of Baoshan Iron and Steel Ltd., a steel producer whose controlling shareholder is the Baowu Steel Group, also serve as the company’s Party Committee Secretary and Deputy Secretary respectively ³⁹. Likewise, the Chairman of the Board of Directors of Wuhan Iron and Steel Group, also controlled by the Baowu Steel Group, serves as the Party Committee Secretary ⁴⁰. Moreover, ‘Wuhan Iron and Steel Group held the tenth centralized study and discussion of the Party Committee Theory Study Group in 2022 to convey and study the spirit of the Central Economic Work Conference and promote the implementation of the decisions and arrangements of the 20th National Congress of the Party and the spirit of the Central Economic Work Conference in Wuhan Iron and Steel Group. [The] General Representative of China Baowu Wuhan Headquarters, Secretary of the Party Committee and Chairman of Wuhan Iron and Steel Group, presided over the meeting and put forward requirements for implementing the requirements of the Party Central Committee, the Hubei Provincial Party Committee and the China Baowu Party Committee, and further implementing the spirit of the Central Economic Work Conference’ ⁴¹.

• (70) Furthermore, the Chairman of the Board of Directors of the Baotou Steel Union, belonging to the Baotou Steel Group, serves also as the company’s Party Secretary. Similarly, the Executive Manager of Baotou Steel Union as well as the Chairman of the company’s trade union are both Deputy Party Secretaries ⁴². Finally, within the Shougang Group, the Chairman of the Board of Directors serves as the Party Committee Secretary, while the Executive Manager is the Deputy Secretary of the company’s Party Committee ⁴³.

• (71) The Industry Association covering the product concerned is the Fasteners Branch ⁴⁴ of the China Machinery General Parts Industry Association ⁴⁵ (‘CMGPIA’). CMGPIA states in Article 3 of its Articles of Association that the organisation,‘in accordance with the provisions of the Constitution of the Communist Party of China, establishes organizations of the Communist Party of China to carry out party activities and provide necessary conditions for the activities of party organizations. The entity in charge of registration and management of this association is the Ministry of Civil Affairs of the People’s Republic of China, and the entity in charge of Party building is the Party Committee of SASAC’ and that it ‘accepts business guidance and supervision from entities in charge of registration and management, entities in charge of Party building, and industry management departments’ ⁴⁶.

• (72) Further, policies discriminating in favour of domestic producers or otherwise influencing the market in the sense of Article 2(6a)(b), third indent of the basic Regulation are in place in the Chinese steel sector, and these are generally applicable to the product under investigation given that the screws without heads industry is a sub-sector of the steel sector. Furthermore, as established in the fasteners investigation, the fasteners industry is listed in the Announcement of the Ministry of Industry and Information Technology on the issuance of the Guiding Catalogue for the Promotion and Application of the First (Set) Major Technical Equipment (2019 Edition) ⁴⁷ and also in the Industrial Structure Adjustment Guidance Catalogue (2019 NDRC) ⁴⁸ as an encouraged industry.

• (73) Next to the above-mentioned documents on the central level, there are a number of guidance documents on the local, provincial or municipal level, which guide and support the development of the fasteners industry. For example, the 2019 Incentive policies for fastener industry in Hayan district, envisages that: ‘Haiyan is the “Hometown of Fasteners”, and the fastener industry is also one of the important traditional industries in Haiyan. […] In order to […] boost the innovation and development of the fastener industry in our county, our county recently issued the “Three-year Special Action Policy for the Digitalization and Smart Transformation of the Fastener Industry in Haiyan County”. The scope of the related special funds covers companies implementing digital and smart transformation in the fastener industry’ ⁴⁹.

• (74) The steel industry is consistently considered as a key industry by the GOC ⁵⁰. This is confirmed in the numerous plans, directives and other documents focused on the sector, which are issued at national, regional and municipal level. Under the 14th FYP, the GOC earmarked the steel industry for transformation and upgrade, as well as optimization and structural adjustment ⁵¹. Similarly, the 14th FYP on Developing the Raw Materials Industry, applicable also to the steel industry, lists the sector as the ‘bedrock of the real economy’ and ‘a key field that shapes China’s international competitive edge’ and sets a number of objectives and working methods which would drive the development of the sector in the time period 2021-2025, such as technological upgrade, improving the structure of the sector (not least by means of further corporate concentrations) or digital transformation ⁵².

• (75) Moreover, the abovementioned Work Plan on the Stable Growth of the Steel Industry (see recital (61)) demonstrates how the focus of the Chinese authorities on the sector is put into the wider context of the GOC steering the Chinese economy: ‘[s]upport steel companies to closely follow the needs of new infrastructure, new urbanization, rural revitalization, and emerging industries, dock with major engineering projects related to the “14th Five-Year Plan” in various regions, and make every effort to ensure steel supply. Establish and deepen upstream and downstream cooperation mechanisms between steel and key steel-using sectors such as shipbuilding, transportation, construction, energy, automobiles, home appliances, agricultural machinery, and heavy equipment, carry out production-demand docking activities, and actively expand steel application fields’ ⁵³.

• (76) At local level, such as in the Shandong province, where Shandong Juning Machinery Co. Ltd is located, the Shandong 14th FYP for iron and steel industry development ⁵⁴ requires the following: ‘Steel for construction machinery: Support our province to move from a major construction machinery province to a strong construction machinery province, focus on developing green and environmentally friendly, high purity, excellent low-temperature impact performance, stable hardenability and easy-to-cut construction machinery steel, accelerate the research and development of high-strength construction machinery steel […], meet the development needs of modern construction machinery with high power and low dead weight, and realize the iterative upgrade of the downstream customer industry chain and the complete and healthy development of the construction machinery manufacturing industry ecosystem’.

• (77) In addition to the above, in the fasteners investigation, it was established that fasteners producers are also beneficiaries of state subsidies, which clearly indicates the interest of the State in the sector. During the fasteners investigation, the Commission established that a number of financial incentive programmes were made available to the fasteners producers, including the 2019 Incentive policies for fastener industry in 2019 in the Haiyan district: ‘Vigorously promote the digital and smart transformation of fastener enterprises: For the application of digital management systems and integrated control device software, special financial incentives will be granted depending on the implementation year, […], Enterprises implementing digital and smart transformation (or new purchases) and upgrade of their equipment in 2019 will be granted a one-time subsidy of up to 20 % of the actual investment in core equipment and a maximum of RMB 2 million; as for implementation in 2020, they will be granted a one-time subsidy of up to 15 % of the actual investment in core equipment and a maximum of RMB 1,5 million; as for implementation in 2021, they will be granted a one-time subsidy of up to 12 % of the actual investment in core equipment and a maximum of RMB 1 million yuan’ ⁵⁵.

• (78) In sum, the GOC has measures in place to induce operators to comply with the public policy objectives of supporting encouraged industries, including the production of the main raw materials used to manufacture the product under investigation. Such measures impede market forces from operating freely.

• (79) The present investigation has not revealed any evidence that the discriminatory application or inadequate enforcement of bankruptcy and property laws in the steel sector, according to Article 2(6a)(b), fourth indent of the basic Regulation would not affect the manufacturers of the product under investigation.

• (80) The product under investigation is also affected by the distortions of wage costs in the sense of Article 2(6a)(b), fifth indent of the basic Regulation, as also referred to above in recital (46). Those distortions affect the sector both directly (when producing the product under investigation or the main inputs), as well as indirectly (when having access to inputs from companies subject to the same labour system in the PRC) ⁵⁶.

• (81) Moreover, no evidence was submitted in the present investigation demonstrating that the sector of the product under investigation is not affected by the government intervention in the financial system in the sense of Article 2(6a)(b), sixth indent of the basic Regulation, as also referred to above in recital (46). The abovementioned Work Plan on the Stable Growth (see recital (61)) exemplifies also this type of government intervention very well: ‘Encourage financial institutions to actively provide financial services to steel companies that implement mergers and reorganizations, layout adjustments, transformation and upgrading, in accordance with the principles of risk control and business sustainability’. Therefore, the substantial government intervention in the financial system leads to the market conditions being severely affected at all levels.

• (82) Finally, the Commission recalled that in order to produce the product under investigation, a number of inputs is needed. When the producers of the product under investigation purchase/contract these inputs, the prices they pay (and which are recorded as their costs) are clearly exposed to the same systemic distortions mentioned before. For instance, suppliers of inputs employ labour that is subject to the distortions. They may borrow money that is subject to the distortions on the financial sector/capital allocation. In addition, they are subject to the planning system that applies across all levels of government and sectors.

• (83) As a consequence, not only the domestic sales prices of the product under investigation are not appropriate for use within the meaning of Article 2(6a)(a) of the basic Regulation, but all the input costs (including raw materials, energy, land, financing, labour, etc.) are also affected because their price formation is affected by substantial government intervention, as described in Parts I and II of the Report. Indeed, the government interventions described in relation to the allocation of capital, land, labour, energy and raw materials are present throughout the PRC. This means, for instance, that an input that in itself was produced in the PRC by combining a range of factors of production is exposed to significant distortions. The same applies for the input to the input and so forth.

• (84) In sum, the evidence available showed that prices or costs of the product under investigation, 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, as shown by the actual or potential impact of one or more of the relevant elements listed therein. On that basis, the Commission concluded that it is not appropriate to use domestic prices and costs to establish normal value in this case. ,

• (85) The GOC did not comment or provide evidence supporting or rebutting the existing evidence on the case file, including the Report and the additional evidence provided by the complainant, on the existence of significant distortions and/or appropriateness of the application of Article 2(6a) of the basic Regulation in the case at hand.

• (86) The Commission received comments from Chinafar Group in relation to the existence of significant distortions in China. The sampled exporting producer argued that the allegation on significant distortion should not become a pre-determined conclusion and, with regard to WTO jurisprudence, investigating authorities should use the cost actually incurred by exporting producers for the calculation of the constructed normal value. Moreover, even if distortions were identified, the Commission should assess each Chinese exporter individually, especially when sampling was applied.

• (87) The Commission considered that the provisions of Article 2(6a) of the basic Regulation are fully consistent with the European Union’s WTO obligations. As explicitly clarified by the WTO Appellate Body in DS473 ⁵⁷, WTO law permits the use of data from a third country, duly adjusted when such adjustment is necessary and substantiated. Under Article 2(6a) of the basic Regulation, it is only when significant distortions are found to be present and to affect costs and prices that normal value is constructed by reference to undistorted costs and prices sourced in a representative country or by reference to an international benchmark. In any event, Article 2(6a) second subparagraph, third indent of the basic Regulation provides for the possibility to use domestic costs only to the extent they are established not to be distorted.

• (88) The Commission noted that once it is determined that due to the existence of significant distortions in the exporting country in accordance with Article 2(6a)(b) of the basic Regulation it is not appropriate to use domestic prices and costs in the exporting country, the normal value is constructed by reference to undistorted prices or benchmarks in an appropriate representative country for each exporting producer according to Article 2(6a)(a) of the basic Regulation. The same provision of the basic Regulation also allows the use of domestic costs if they are positively established not to be distorted. In that context, the exporting producers had the possibility to provide evidence that their individual SG & A costs and/or other input costs were actually undistorted. However, as evidenced in recitals (46) to (84), the Commission has established the existence of distortions in the steel industry and there was no positive evidence as to the factors of production of individual exporting producers being undistorted. Therefore, these claims were rejected.

• (89) In view of the above, 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 described in the following section.

3.2.2.   Representative country

3.2.2.1.   General remarks

• (90) 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 China. For this purpose, the Commission used countries with a gross national income per capita similar to China on the basis of the database of the World Bank ⁵⁸,

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

• — Existence of relevant 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.

• (91) As explained in recitals (37) to (39), the Commission issued two notes for the file on the sources for the determination of the normal value.

• (92) 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.

• (93) In the Second Note, 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.

3.2.3.   A level of economic development similar to China

• (94) In the First Note, the Commission identified Malaysia, Thailand and Türkiye as countries with a similar level of economic development as China 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.

• (95) Following the First and Second Note, Chinafar Group claimed that Thailand should be discarded as a potentially representative country since its gross national income (GNI) per capita is nearly half that of China and therefore Thailand cannot be considered a country with level of economic development similar to China. It further noted that the Commission itself stated in the First Note that it ‘intends to use countries with a gross national income similar to China’, without making reference to the category of upper-middle countries.

• (96) When constructing the normal value in line with Article 2(6a)(a) of the basic Regulation, the Commission may use a representative country with a similar level of economic development as the exporting country. The basic Regulation does not contain any further requirement to choose the country with the level of economic development closest to the exporting country. In these circumstances, the Commission does so by exercising its discretion and using countries classified in the same income category by the World Bank. The relevant World Bank category is that of the upper-middle income countries, in which China is classified. The Commission clearly specified in the First Note that it would use the World Bank database for this purpose, which is also in line with its practice. The fact that a country may have a closer GNI or GDP per capita to China than another one is not a decisive factor in the selection of the appropriate representative country. Therefore this claim was rejected.

3.2.4.   Existence of relevant readily available data in the representative country

• (97) In the First Note, the Commission provided information on readily available financial data for companies producing the broader category of fasteners, including the product under investigation, in Malaysia, Thailand, and Türkiye, and on imports into these countries of the raw materials to produce the product under investigation.

• (98) In their comments to the First Note, the three sampled exporting producers and EFDA proposed Malaysia as the most appropriate representative country, while the complainant proposed Türkiye. No alternative representative country for this investigation was suggested.

• (99) Junyue and Chinafar Group contended that Türkiye could not be considered a representative country since its economy had been characterised by high inflation, significant currency devaluation, and political interference, in particular regarding the determination of labour cost levels.

• (100) The Commission noted that inflation and currency deflation were not criteria used for assessing the representativity of a country pursuant to Article 2(6a)(a) of the basic Regulation and in the case that the Commission would choose Türkiye as a representative country, it would adjust the values for inflation and/or currency deflation where appropriate to reflect the costs for the investigation period. Also, the companies did not provide substantiated evidence on the existence of political interference in labour costs. Therefore, the Commission rejected this claim.

• (101) Junyue and Chinafar Group claimed that both Thailand and Türkiye were not appropriate representative countries based on the volume of imports from the Russian Federation (‘Russia’).

• (102) The Commission had already provided in the First Note an analysis of the import trends from Russia from 2019 up to the investigation period, which showed no significant change, both in volumes and in average price, in the imports from Russia to both countries. Therefore, there was no indication that Russian export patterns had changed due to the sanctions in force following the full-scale invasion of Ukraine in 2022, which could have caused distorting import prices in those two countries. The claim was therefore rejected.

• (103) Following the First Note, Junyue also submitted that Thailand's fastener industry, including screws, was heavily specialised in automotive-grade fasteners, which were not representative of the product under investigation as fasteners used in the automotive sector tended to be higher priced, since they had to comply with more stringent product standards. Due to this specialisation, Junyue claimed that for certain factors of production Thai producers resorted to special grade imports of Japanese origin, which rendered the benchmark unrepresentative.

• (104) Based on GTA, the Commission evaluated Japanese export prices for the main raw materials (i.e. HS codes 7213 91 , 7213 99 , 7228 30 , 7227 90 , and 7214 99 ). During the investigation period, Thailand was Japan’s main export market, accounting for 21 % of the total exports of these raw materials. The other top five export destinations, excluding China, together represented about 53 % of the total exports of these raw materials. The average export price to Thailand was 10 % higher compared to these other top markets (1,09 EUR/kg price for Thailand and 0,90 EUR/kg to the other top five export countries).

• (105) The Commission concluded in the Second Note that, while it was possible that Thai producers of fasteners imported special grade materials from Japan, this did not disqualify Thailand as a representative country. In fact, non-standard screws were also covered by the present investigation and special grade raw materials might be used for these products. Therefore, it could not be concluded that Japanese export prices to Thailand were unreasonably high and unrepresentative. The Commission rejected the claim in recital (103) that Thailand should be excluded as an appropriate representative country.

• (106) In the Second Note, the Commission further analysed the imports of the three main factors of production, accounting for about 65 % of the cost of manufacturing (classified under HS codes 7213 91 , 7213 99 and 7228 30 ) into the three potential representative countries. For all these factors of production, imports into Thailand (excluding imports from China and countries listed in Annex 1 to Regulation (EU) 2015/755 of the European Parliament and of the Council ⁵⁹) were the largest in terms of quantities.

• (107) For the factor of production under HS code 7213 91 , total imports from undistorted sources were significant in all three countries, with Thailand having the highest quantities of imports from countries other than China and countries listed in Annex 1 to Regulation (EU) 2015/755.

• (108) Regarding the factor of production under HS code 7213 99 , Thai imports represented by far the highest import volume, amounting to around 76 000 tonnes, i.e. five times higher than import volumes into Malaysia and Türkiye. Imports from China and countries listed in Annex 1 to Regulation (EU) 2015/755 into Malaysia represented 33 % of the total imports into the country and the average import price from other sources into Malaysia was similar to the import price from China and countries listed in Annex 1 to Regulation (EU) 2015/755. At the same time, Thailand and Türkiye had virtually no imports from China and countries listed in Annex 1 to Regulation (EU) 2015/755. Therefore, the Commission considered the import price into Malaysia to be less reliable than the import price into Thailand or Türkiye.

• (109) For HS code 7228 30 , the import volume into Thailand was by far the largest among the three countries. Imports from China and countries listed in Annex 1 to Regulation (EU) 2015/755 represented a high share of total imports of this factor of production into all three countries. However, the average import price from other sources into Türkiye was comparable to that from China and countries listed in Annex 1 to Regulation (EU) 2015/755 and thus might have been influenced by the Chinese import price, while the average import price from other sources into Thailand or Malaysia was significantly higher than that from China. Therefore, the Commission considered the import price into Türkiye to be less reliable than the import price into Thailand or Malaysia.

• (110) Junyue provided the audited financial statements covering the investigation period for the subsidiary of the Malaysian producer selected by the Commission in the First Note, producing only fasteners (Chin Well Fasteners Co. Sdn. Bhd. (‘Chin Well Fasteners’)). It also identified an additional producer in Malaysia producing standard fasteners (Asia Bolts & Nuts Sdn. Bhd.) with readily financial information for 2023. The latter was discarded as it showed a profit of 0,7 %, which was not considered reasonable.

• (111) Junyue and Chinafar claimed that the financial information of the Thai and Turkish companies identified by the Commission in the First Note were not representative of the product under investigation and showed abnormally high SG & A and profit ratios.

• (112) They claimed that this was explained by the fact that products manufactured by these companies were not comparable to the product under investigation, since they were mainly high-strength, high-quality fasteners for very niche and very profitable markets such as the aerospace, automotive and energy/petrochemical sectors and therefore of a higher quality compared to the product under investigation manufactured in China.

• (113) They argued that this also applied to the Thai company Thai Meira, Co. Ltd., which specialised in non-standard fasteners for the automotive industry. Moreover, also the Thai company S.J. Screws Co. Ltd. could not be considered representative, since it mostly manufactured products not falling under the product under investigation which involved a higher cost of production, such as rigging hardware, steel plates and fishing industrial products, or non-standard fasteners for the automotive industry.

• (114) The Commission noted that some of the sampled Chinese producers produced high-strength fasteners and served specific sectors, such as offshore oil fields and oil pipelines. The fact that the companies found in the possible representative countries are specialised in certain segments, such as non-standard screws for the automotive industry, which are part of the product under investigation, and/or they produce only part of the product under investigation, is not a reason to exclude these companies. Therefore this claim was dismissed.

• (115) EFDA commented that the Commission did not include in the list of selected companies an important Turkish producer, Norm Civata Sanaya Ve Ticaret Anonim Sirketi (‘Norm Civata’).

• (116) From the information provided in the Orbis database, it appeared that Norm Civata is a wholesale company regrouping several branch companies and its financial information is at consolidated level. The financial information of the branch active in the ‘Metals & Metal Products’ was not available. Therefore, the Commission considered it inappropriate to use the annual report of Norm Civata for the purpose of this investigation.

• (117) EFDA also questioned the methodology for the calculation of SG & A and claimed that the financial profit and loss should be subtracted from the operating expenses. The Commission rejected this claim as it is its established practice to include financial expenses in the SG & A expenses to reflect the full cost of production of the product under investigation.

• (118) In light of the above considerations, the Commission informed the interested parties with the Second Note that it intended to use Thailand as an appropriate representative country and the financial data of three companies ⁶⁰, in accordance with Article 2(6a)(a), first indent of the basic Regulation in order to source undistorted prices or benchmarks for the calculation of normal value.

• (119) Interested parties were invited to comment on the appropriateness of Thailand as a representative country and of the three companies as producers in the representative country.

3.2.5.   Comments of the interested parties

• (120) Following the Second Note, Junyue, Chinafar Group and EFDA reiterated their claim that Malaysia was the most appropriate representative country within the meaning of Article 2(6a)(a) of the basic Regulation rather than Thailand for a number of reasons.

• (121) First, they claimed that companies in Malaysia mainly produced standard fasteners and, therefore, their product mix was similar to that of Chinese producers.

• (122) Second, Junyue and EFDA considered unjustified that the Commission only focused on imports volumes of one single factor of production (HS 7213 99 ) to disregard Malaysia as representative country. For this factor of production, Chinese imports from China represented 33 % of the total imports, a similar percentage of imports into Thailand of the other two factors of productions (HS 7213 91 and HS 7228 30 ).

• (123) Third, Junyue argued that the similarity between the average price of Chinese imports and the average import price from other countries merely indicated that prices of imported materials were essentially set at market terms.

• (124) Junyue further contended that Thailand’s import data was even more concerning due to a higher overall proportion of Chinese imports into Thailand (43 %) compared to Malaysia (29 %) and Türkiye (15 %).

• (125) Contrary to Junyue’s claim, the Commission did not focus on imports of one single factor of production to disregard Malaysia as a representative country. In fact, the Commission analysed the imports of the three main factors of production accounting for about 65 % of the cost of manufacturing (HS 7213 91 , HS 7213 99 and HS 7228 30 ) into the three potential representative countries.

• (126) For all these factors of production, imports into Thailand (excluding imports from China and countries listed in Annex 1 to Regulation (EU) 2015/755) were the largest in terms of quantities. For HS code 7213 91 , total imports from undistorted sources were significant in all three countries, with Thailand having the highest quantities of imports from countries other than China and countries listed in Annex 1 to Regulation (EU) 2015/755.

• (127) For HS code 7213 99 , Thai imports represented by far the highest import volume, amounting to around 76 000 tonnes, i.e. five times higher than import volumes into Malaysia and Türkiye. As stated in recital (108), Chinese imports into Malaysia represented 33 % of the total imports into the country and the average import prices from countries other than China were comparable to Chinese prices, suggesting that they might be less reliable.

• (128) For HS code 7228 30 , accounting for 11 % of the total cost of manufacturing, in view of the volume of imports, the Commission considered Thailand the most representative country, as set out in recital (109) above.

• (129) On this basis, the Commission considered that Thailand had a higher quality set of readily available data for undistorted import values and therefore concluded to consider Thailand the appropriate representative country and dismissed Junyue’s claim.

• (130) Junyue and Chinafar Group reiterated the claim that Thai import prices were high due to the significant presence of special grade imports of Japanese origin, used by Thai producers for special applications, notably the automotive sector. Junyue also maintained that this trend was related to the fact that several producers were linked to Japanese companies and sourced high-grade raw materials from their parent companies.

• (131) Junyue further contended that, should the Commission decide to maintain Thailand as representative country, import data should be adjusted by deducting Japanese imports from the total imports, since they are unreasonably high priced.