Commission Implementing Regulation (EU) 2025/1732 of 13 August 2025 imposing a provisional anti-dumping duty on imports of candles, tapers and the like originating in the People’s Republic of China

THE EUROPEAN COMMISSION,

Having regard to the Treaty on the Functioning of the European Union,

Having regard to Regulation (EU) 2016/1036 of the European Parliament and of the Council of 8 June 2016 on protection against dumped imports from countries not members of the European Union (1) (‘the basic Regulation’), and in particular Article 7 thereof,

After consulting the Member States,

Whereas:

(1) On 19 December 2024, the European Commission (‘the Commission’) initiated an anti-dumping investigation with regard to imports of candles, tapers and the like originating in the People’s Republic of China (‘the country concerned’, ‘the PRC’ or ‘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 4 November 2024 by Union producers representing more than 25 % of the total Union production in the period from 1 April 2023 to 31 March 2024 (‘the complainant’). The complaint was made on behalf of the Union industry of candles, tapers and the like in the sense of Article 5(4) of the basic Regulation. The complaint contained evidence of dumping and of resulting material injury that was sufficient to justify the initiation of the investigation.

(3) The Commission made imports of the product concerned subject to registration by Commission Implementing Regulation (EU) 2025/511 (3) (‘the registration Regulation’).

(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 Government of China (‘GOC’), 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.

(6) Following initiation, one exporting producer, Qingdao Kingking Applied Chemistry Co Ltd (‘Qingdao Kingking’) and one association of candle producers, China Household Chemicals Industry Association (‘CHCIA’) questioned the product scope of the investigation.

(7) CHCIA considered that the definition of the product under investigation was broad and vague, suggesting that the two representative examples provided in the complaint - white unscented tea lights in aluminium cups and fragrant glass candles - are incomplete and outdated compared to what exporting producers are currently exporting. CHCIA considered that a significant portion of the sales to the Union by Chinese exporting producers are more sophisticated and requires significant artistic knowledge and manual skills to produce, and which Union producers cannot manufacture due to labour costs.

(8) To conclude, CHCIA requested the exclusion of handmade decoration candles, candles in containers of glass or ceramic cups and scented candles.

(10) The complainant disagreed with the arguments of Qingdao Kingking and CHCIA and opposed to the product exclusion request submitted by them. It stressed that the two types of representative candles in the complaint referred to in recital 7 above are representative of imported candles, not representative of what Union candle producers manufacture. It also stressed the need to keep the definition of the product under investigation as it was provided for in the Notice of Initiation since Union producers’ candle output also include the products for which CHCIA and Qingdao Kingking requested an exclusion.

(11) The Commission considered that, all candles, tapers and the like should be treated as the product under investigation. The Commission recalled that the system of Product Control Number will ensure that candles with a certain container, with or without colour and with or without scent will only be compared with a similar type of candle.

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

(13) In its Notice of Initiation, the Commission stated that it had provisionally selected a sample (4)of Union producers. The Commission selected the sample on the basis of volume of production and sales of the like product in the Union in the investigation period. This sample consisted of three Union producers. Due to the inability of a sampled producer, HANSA CANDLE (Estonia), to provide a response to the questionnaire, the Commission decided to replace (5) this company with another producer, Løgumkloster Lys (Denmark). However, the newly sampled producer was also unable to provide a response to the questionnaire. Consequently, the final sample comprised of two Union producers. At the time the sampling was conducted, these two producers accounted for over 35 % of the production and more than 40 % of the sales volume of the companies participating in the standing. After verifying the macro-questionnaire, it was determined that these companies accounted for over 16 % of the estimated production and more than 17 % of the estimated sales volume of the Union industry in the Union. The Union’s industry comprises a large number of companies, more than 80 in total, including both large firms and a wide range of small and medium-sized enterprises. Given this structure, a 16 – 17 % share is considered representative of the broader industrial landscape. The sample is representative of the Union industry.

(14) 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. However, no unrelated importers came forward, nor provided the necessary information within the deadline. As a result, no sampling of unrelated importers was conducted.

(15) 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. Seventy-three 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 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 the country concerned were consulted on the selection of the sample (6). The Commission did not receive any objections to the proposed sample. After a clerical update by one of the provisionally non-sampled exporting producers, the Commission finally determined (7) the sample to consist of three exporting producers, collectively exporting more than 50 % by volume to the Union during the investigation period.

(16) One exporting producer in the PRC requested individual examination under Article 17(3) of the basic Regulation. The examination of this request during the provisional stage of the investigation would have been unduly burdensome due to the complexity of the case, the production processes and the corporate structure of the sampled exporting producers. The Commission will decide whether to grant individual examination at the definitive stage of the investigation.

(17) 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 GOC.

(18) 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.

(19) The Commission sent questionnaires to the Union producers, the sampled exporting producers in the PRC, the known importers and users The same questionnaires were made available online (8) on the day of initiation.

(21) The investigation of dumping and injury covered the period from 1 October 2023 to 30 September 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’).

(22) The product under investigation is candles, tapers and the like, currently classified under CN code 3406 00 00 (‘the product under investigation’).

(23) The production process to manufacture candles consists in heating raw materials (mainly paraffin wax) and shaping the candle in moulds or containers in a cooling process. The most common raw material used for producing candles, tapers and the like is paraffin wax. Paraffin wax is derived from mineral raw materials, in particular mineral oil, coal or oil shale, and to a lesser extent, natural gas. The product concerned may also be produced with other fuel waxes, such as animal or vegetable stearin.

(24) Candles produce heat and light, but are largely used for interior decoration purposes, for example in various candle holders, pillars and other decoration items, or for outdoor purposes.

(25) The product under investigation comes in a great variety of sizes, shapes and weight. It can be plain white or coloured (either entirely or only at the outside), scented or unscented, and decorated or undecorated. The surface can be smooth or rough. The product concerned can be contained in a glass/jar or containers of various materials (e.g. ceramic, aluminium, plastic). There are also variances in terms of the wick used in the candle. They may be flat, square, cored (with materials like cotton or tin), wooden, or speciality (i.e., designed to meet the burn characteristics of specific candle applications).

(26) The product concerned is candles, tapers and the like originating in the PRC, currently falling under CN code 3406 00 00 (‘the product concerned’).

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

(29) The Commission received a claim on product scope from Qingdao Kingking and CHCIA. Their claim on the product scope has been addressed under section 1.4 above.

(30) 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.

(31) Consequently, 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 candles, tapers and the like. Ten exporting producers submitted the relevant information.

(32) 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.

(33) In respect of the use of the application of Article 2(6a) of the basic Regulation, all exporting producers questioned the use thereof. The objections have been addressed in the following sections.

(34) 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.

(35) In point 5.3.2 of the Notice of Initiation, the Commission also specified that, in view of the evidence available pursuant to Article 2(6a)(a) of the basic Regulation, for the purpose of determining the normal value based on undistorted prices or benchmarks, one possible appropriate representative third country is Thailand. 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.

(36) The Commission issued two notes for the file to inform interested parties on the relevant sources it intended to use for the determination of the normal value: the first note on the production factors of 25 April 2025 (hereinafter the ‘First Note’) and the second note on the production factors of 20 May 2025 (hereinafter the ‘Second Note’), which was followed by supplementary note of 22 May 2025, correcting a clerical mistake in an exchange rate and providing detailed import data including the applicable duties and labour data.

(37) In these notes, the Commission provided a list of all factors of production such as raw materials, labour and energy used in the production of the product concerned. In addition, based on the criteria guiding the choice of undistorted prices or benchmarks, the Commission identified possible representative countries. It also informed interested parties that it would establish selling, general and administrative costs (‘SG&A’) and profits based on Nopparat Candlelight Company Limited and T.T.T. Candle Co Ltd., two producers of the product concerned in the representative country. These notes also addressed the comments received by the interested parties on these elements and on the relevant sources. The comments provided by the parties are addressed in the following sections.

(38) 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’.

(39) 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’).

(40) 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, the application of Article 2(6a) of the basic Regulation was appropriate.

(42) 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.

(43) 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.

(44) 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’.

(45) Pursuant to this provision, the Commission issued a country report concerning China (‘the Report’ (10)) containing 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 in specific sectors (such as steel and chemicals). 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 in the investigation file at the initiation stage.

(46) The complaint referred to the Report and also contained additional relevant evidence complementing the Report.

(47) More specifically, the complaint indicated that domestic prices and costs of candles, tapers and the like in China cannot be accepted since they are at odds with the notion of free play of market forces but rather result from the complex and all-encompassing state intervention.

(48) In support of this claim, the complaint emphasised the role of the Chinese Communist Party (‘CCP’) in shaping the Chinese economy in line with the socialist market economy doctrine. With regard to this, the complainant pointed out that the Chinese Constitution, as well as various other legal acts, grant the state and the CCP a decisive role in the economy. The complainant noted further that in response to the global trade tensions, the concept of ‘dual circulation’ has been focal in the CCP’s industrial policy agenda. This focuses mainly on domestic circulation, reducing the reliance on imports, and the reinforcement of the international economic cycle with increased penetration of Chinese industrial operators into the global market.