Commission Implementing Regulation (EU) 2025/1919 of 25 September 2025 imposing a definitive anti-dumping duty and definitively collecting the provisional duty imposed on imports of certain hot-rolled flat products of iron, non-alloy or other alloy steel originating in Egypt, Japan and Vietnam, and terminating the investigation on imports thereof originating in India

COMMISSION IMPLEMENTING REGULATION (EU) 2025/1919 of 25 September 2025 imposing a definitive anti-dumping duty and definitively collecting the provisional duty imposed on imports of certain hot-rolled flat products of iron, non-alloy or other alloy steel originating in Egypt, Japan and Vietnam, and terminating the investigation on imports thereof originating in India

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 9(4) thereof,

Whereas:

(1) On 8 August 2024, the European Commission (‘the Commission’) initiated an anti-dumping investigation with regard to imports of certain hot-rolled flat products of iron, non-alloy or other alloy steel, originating in Egypt, India, Japan and Vietnam (‘the countries concerned’) on the basis of Article 5 of the basic Regulation. The Commission 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 24 June 2024 by the European Steel Association (‘EUROFER’ or ‘the complainant’). The complaint was made on behalf of the Union industry of certain hot-rolled flat products of iron, non-alloy or other alloy steel 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 certain hot-rolled flat products of iron, non-alloy or other alloy steel originating in Egypt, India, Japan and Vietnam subject to registration by Commission Implementing Regulation (EU) 2024/2719 (‘the registration Regulation’) (3).

(4) In accordance with Article 19a of the basic Regulation, on 14 March 2025, the Commission provided parties with a summary of the proposed duties and details of the calculation of the dumping margins and the margins adequate to remove the injury to the Union industry. Interested parties were invited to comment on the accuracy of the calculations within three working days. The Commission did not receive comments relating to the accuracy of the calculations.

(5) On 7 April 2025, the Commission imposed provisional anti-dumping duties on imports of certain hot-rolled flat products of iron, non-alloy or other alloy steel originating in Egypt, Japan and Vietnam by Commission Implementing Regulation (EU) 2025/670 (4) (‘the provisional Regulation’).

(6) Following the disclosure of the essential facts and considerations on the basis of which a provisional anti-dumping duty was imposed (‘provisional disclosure’), the complainants, the following exporting producers: Daido Steel Co., Ltd. (‘Daido’), Formosa Ha Tinh Steel Corporation (‘FHS’), Al Ezz Dekheila Steel Company S.A.E (‘Ezz Steel’), Nippon Steel Corporation (‘Nippon Steel’) and JFE Steel Corporation (‘JFE’), Hoa Phat Group, as well as the Government of Egypt (‘GOE’) and the Government of Japan (‘GOJ’) made written submissions making their views known on the provisional findings within the deadline provided by Article 2(1) of the provisional Regulation.

(7) The parties who so requested were granted an opportunity to be heard. Hearings took place with Ezz Steel, the GOE, Nippon Steel and the GOJ.

(8) The Commission continued to seek and verify all the information it deemed necessary for its final findings. When reaching its definitive findings, the Commission considered the comments submitted by interested parties and revised its provisional conclusions when appropriate.

(9) The Commission informed all interested parties of the essential facts and considerations on the basis of which it intended to impose a definitive anti-dumping duty on imports of certain hot-rolled flat products originating in Egypt, Japan and Vietnam (‘final disclosure’). All parties were granted a period within which they could make comments on the final disclosure.

(10) Parties who so requested were also granted an opportunity to be heard. Hearings took place with the GOE, Ezz Steel (EZDK and EFS), GOJ and Nippon Steel.

(11) Following the final disclosure, the Commission received comments from Daido, FHS, Hoa Phat Group, Nippon Steel, JFE, GOJ and EUROFER.

(12) Certain comments submitted by Nippon Steel were accepted, which affected the level of the injury margin for this exporting producer and for the Japanese non-sampled cooperating exporting producers. The new margins were re-disclosed in an additional final disclosure on 7 August 2025 to all parties, which were given the opportunity to provide comments. No comments were received.

(13) Following final disclosure, the Commission found that the non-captive sales to related parties by the Union industry had been double counted in consumption and sales figures reported in Tables 1, 3 and 4 of the general disclosure document. The market shares of imports from the countries concerned and other third countries calculated in Tables 2 and 6 were revised accordingly. This change does not affect the relevant trends and thereby the findings disclosed in the final disclosure. However, considering that some of the values were slightly different to the ones disclosed in the final disclosure, an additional final disclosure was made informing interested parties of these revisions on 18 August 2025. The interested parties were given an opportunity to comment within 2 days in line with the last sentence of Article 20(5) of the basic Regulation, given the timeframe of the investigation. No comments were received.

(15) As mentioned in recital (16) of the provisional Regulation, it was considered that the version open for inspection by interested parties of the complaint contained all the essential evidence and non-confidential summaries of data provided under confidential cover in order for interested parties to exercise their right of defence throughout the proceeding. The claim was therefore rejected.

(16) After final disclosure, FHS reiterated that its concrete examples such as ‘missing PCN tables; copyright-blanked market studies; illegible capacity worksheets)’ and the absence of a reasoned explanation of why those items could remain concealed violated Article 6 WTO ADA and Article 19(2) of the Basic Regulation but did not submit additional arguments. In the absence of new elements and as mentioned in recital (15), the claim was rejected.

(17) In the absence of comments concerning sampling, recitals (27) to (35) of the provisional Regulation were confirmed.

(18) In the absence of comments concerning this section, recital (36) of the provisional Regulation was confirmed.

(19) An additional verification visit was carried out at the premises of EUROFER, in Brussels, Belgium.

(20) FHS argued that by recognising in recital (45) of the provisional Regulation that the year 2021 had been ‘an exceptionally low point’ for capacity utilisation, and also acknowledging the existence of a post-COVID-19 price spike in the same period, the Commission should not have used this ‘abnormal year’ as the benchmark. By choosing 2021 as the index base year, the Commission created a bias affecting the trend line.

(21) The Commission addressed this claim in recital (42) of the provisional Regulation, where it stated that the period considered should not be extended to the year 2020 since the market and the performance of the Union industry were severely influenced by exceptional circumstances triggered by the COVID-19 crisis. Such extension would not have added value, in particular since in 2020, the industry faced significant losses, primarily attributable to the impact of COVID-19. The market situation started to go back to normal in terms of supply and demand, which explains the improvement of the economic situation of the Union Industry, however, at the same time the Union Industry found itself under renewed pressure from imports from the countries concerned, which eroded market share and profits which became even more acute in 2023 and in the IP. Moreover, the length of the period considered was consistent with standard investigation practices.

(22) After final disclosure, FHS claimed that the Commission ignored its proposal to start the investigation period in 2019 instead of 2021, which resulted in a breach of the Commission’s obligation of objective-examination standard under Article 3.1 of the ADA. Further comments received from exporting producers after final disclosure linked to both the start of the period considered and the injury analysis are addressed in the Section 4.

(23) In the absence of any other comments concerning the investigation period (‘IP’) and the period considered, recitals (40) to (45) of the provisional Regulation was confirmed.

(24) One exporting producer, Daido, requested the exclusion of all its types of hot-rolled flat steel products on the basis that they are known in the industry as tool steel and high-speed steel, even though they do not fit the description of tool steel included in the EU Combined Nomenclature (CN).

(25) The Commission confirmed in the provisional Regulation that tool steel and high-speed steel were not covered in the product scope of the investigation at hand. However, the Commission considered that the claim of Daido to exclude all its types of hot-rolled flat steel products was not specific enough, opening the risk that it could cover also many ordinary hot-rolled flat steel products for other uses than for tools. On these grounds, the Commission dismissed Daido’s claim to reject all its products but confirmed the exclusion of tool steel as provided in Section 2.1 of the provisional Regulation. The Commission also considered that the use of the appropriate CN codes was of the responsibility of the importers when declaring the goods to the customs authorities.

(26) Following the imposition of provisional measures, Daido claimed that even if its tool steel fell outside the definition of tool steels and therefore not falling within the dedicated CN codes to tool steel (5), their tool steel still competed with them. Therefore, the Commission should recognise ‘Daido’s tool steels’ as having different physical and chemical properties from those of the ‘hot-rolled flat steel products’ covered by this investigation, and exclude them from the product scope.

(27) Daido considered that it had in its submission established objective and specific criteria to support their exclusion request. Furthermore, Daido was confident that both the end use of tools steels and their physical characteristics were sufficiently specific for preventing the exclusion of non-tool steel products that should not be excluded from the investigation (i.e. to prevent circumvention).

(28) The Commission concluded that based on the information on the file and in the absence of information to the contrary from Daido, ‘Daido’s Tool Steel’ products are not, as such, different from HRF and could cover many ordinary hot rolled flat steel products for other uses than for tools. Consequently, the Commission did not consider that it was warranted to explicitly exclude ‘Daido’s Tool Steel’ products from the product scope.

(29) After final disclosure, Daido provided additional technical documents (inspection certificate and chemical specification sheet) to support its exclusion request. Daido also stressed that rejecting ‘Daido’s tool steel’ exclusion request meant that although their tool steel products were defined under DIN standards as tool steels, the Commission was not treating them as tool steels simply because they did not fall under the definition set in the EU’s classification system. This, in Daido’s view, was not a sufficient argument not to consider ‘Daido’s tool steel’ as tool steel. Finally, Daido pointed to the fact that when ‘Daido’s tool steels’ are imported into the EU, it provides an inspection quality certificate to the customs authorities, in which Daido’s company name and Daido’s tool steels’ types are clearly mentioned. This should thus allow customs authorities to distinguish and verify that ‘Daido’s tool steels’ are not HRF.

(30) However, Daido still failed to provide objective technical characteristics according to the definition of tool steel in the dedicated CN codes, that would confirm that they fall in the definition set in the EU’s classification system of tool steel and thus allow customs authorities to distinguish ‘Daido’s tool steels’ from any other steel product covered by the measures. An alleged market perception is not sufficient to exclude a product. The reference to DIN standards allowing to define tool steel products was rejected on the ground that the description of tool steel, which is included in the EU Combined Nomenclature (CN) provided a very precise composition of the individual elements required in the Additional Note to Chapter 72 of the EU’s Combined Nomenclature Regulation. As noted in recital (24), and confirmed by Daido, ‘Daido’s Tool Steel’ was not an actual tool steel within the meaning of the EU Combined Nomenclature. Indeed, the Commission noted that the additional note 1 to Chapter 72 provides for a clear definition of tools steels. Should the product for which an exclusion is requested not fall in the defined scope for tools steels, they should not be considered as such and would therefore fall under the scope of this investigation.

(31) The Commission thus rejected the exclusion request of ‘Daido’s tool steels’. As to the impact on the requesting party, the Commission failed to see why the non- exclusion would be ‘catastrophic’, as claimed by the party, given the capacity of Daido to declare its products under the correct CN code to the customs authorities or to request a specific CN code.

(32) In the absence of any other comments with respect to the product scope, the Commission confirmed the conclusions set out in recitals (52) and (53) of the provisional Regulation.

(33) Following imposition of provisional measures, the Commission received written comments on the provisional dumping findings regarding Egypt from the Egyptian exporting producer Ezz Steel, the GOE and EUROFER. In addition, comments were received after final disclosure from Ezz Steel and the GOE. Those claims are addressed in the relevant sections below.

(34) The details of the calculation methodology of the normal value were set out in recitals (54) to (65) of the provisional Regulation.

(35) In the absence of claims related to the calculation of the normal value, those recitals are hereby confirmed.

(36) The details of the calculation of the export price were set out in recital (66) of the provisional Regulation.

(37) At the provisional disclosure stage, EZZ Steel identified five export sales transactions which were reported by the company in their questionnaire reply but were missing from the dumping calculation. The Commission corrected accordingly.

(38) Following the publication of the provisional Regulation, Ezz Steel and the GOE submitted that the Commission should have used the invoice date as the date for the exchange rate to convert export sales to the Union in USD into local currency, instead of using the initial sales contract date. Ezz Steel furthermore argued that, if the Commission were to deviate from using the invoice date, it should not use the initial sales contract date, but the date of issuance of the letter of credit for the corresponding export sale, when the contract becomes final. For this, an average time lag between the invoice date and sales contract date of 20 days was proposed by the company based on the few export transactions sampled by the Commission during the verification which would effectively lead to applying an average exchange rate no greater than 30 days following the date at which the sales legal terms become final.

(39) EZZ Steel argued that the Commission should also use the sales invoice date to the domestic sales as there was also a time lag of between one and two months between the date of the sales contract and the date of the invoice, and that prices varied between those dates.

(40) Regarding the export sales, the parties did not demonstrate, nor did the sampled sales transactions reveal that there was a structural difference in the agreed terms of sales (for instance in price, volume or quality) in between the initial sales contract date and the date of issuance of the letters of credit other than the existence of a time lag for the small number of 18 export transactions in question, not representative of the population. In addition, the average of 30 days mentioned in recital (38) is irrelevant because the standard deviation of the sample is high. Therefore, this claim was rejected.

(41) Concerning the claim at provisional disclosure stage regarding the existence of a similar situation for the domestic terms of sales and that for domestic sales the sales contract date should be used instead of the sales invoice date, the Commission concluded that besides that this claim was not substantiated by any evidence, there was also no reason to deviate from the domestic sales invoice date since these sales were not subject to the exchange rate difficulties as the domestic sales were all made in Egyptian pounds. This claim was thus rejected.

(42) Following the final disclosure, Ezz Steel and the GOE further elaborated on their claim at provisional stage that the Commission had used the incorrect date to convert export sales from USD to EGP, adding two reasons: the devaluation and the date when the material terms of sale are set.

(43) According to Ezz steel, the Commission did not explain in the provisional regulation how the exchange rate fluctuations and overall decrease of the EGP against the USD lead to the conclusion that the reference point needed to be the date of the sales contract and not the invoice date.

(44) The reasons for using the sales contract date instead of the invoice date were however clearly stated in recital (72) of the provisional Regulation. As explained therein, the fact that the company operated in a situation of high devaluation of the EGP against the USD and the Euro in combination with the fact that sales conditions, including the sales price, were set at the moment of the sales contract, a moment where only the exchange rate at that time was known, justified the use of the sales contract date as the correct reference date for the sale and not the invoice date.

(45) The company further argued that the ‘hybrid’ methodology used by the Commission by considering the exchange rate at the time of the contract date for export sales and the exchange rate at the time of the invoice date for the domestic sales did not allow for a fair comparison between the normal value and the export price. This was because the devaluation of the EGP was taken into account only on the domestic side while on the export side this was negated by using the sales contract date. In support of its argument, the company referred to a report prepared by a consultant which stated in its summary that this approach ‘(…) implies that domestic prices duly reflect the impact of 1-2 months of inflation (from order to invoice), whereas the corresponding appreciation of the EGP vs the USD during the same period is ignored’ (6).

(46) The devaluation of the EGP versus the USD was established, confirmed to exist and thus taken into account. The company failed however to provide substantial evidence for this claim demonstrating a need for a consistent adjustment of domestic prices over time in line with inflation. Also, during the investigation it was established that for domestic sales, the company was not able to link specific sales to specific payments. Clients can pick up the product at Ezz steel warehouses when they have green light from the department which controls the current accounts. However, Ezz steels’ internal control procedures do not provide sufficient and adequate information as regards at which date exactly a specific invoice was paid. Therefore, it was not possible to establish the precise payment date per domestic sales transaction and thus evaluate or quantify the alleged impact of the devaluation of the EGP on domestic prices. In addition, this claim regarding the impact of inflation on the domestic sales refers to inflation in general, not specifying which index was used. It is therefore unknown whether it refers to the general inflation index that includes many items outside the scope of the investigation which are, consequently, irrelevant. Only the evolution of the prices of the like product on the domestic market are important and as regards those, in the financial statements of both EZDK and EFS the statutory auditors did not address any key audit matters related to inflation. There is also no reference in the financial statements of the company to IAS 29 Financial Reporting in Hyperinflationary Economies. This request for an adjustment under Article 2(10) of the basic Regulation was therefore rejected as unsubstantiated.

(47) In addition, Ezz steel reiterated its claim that the terms of the export sales were set only when the contract between the parties was countersigned by the purchaser or the letter of credit had been issued. Using this approach, Ezz steel concluded that, for the selected sample of export sales verified on spot, the average number of days between the sales contract date and the issuance of the letter of credit was about 20 days for the group. As a result, according to the company, the Commission should have relied on the date of issuance of the letter of credit.

(48) Besides that the letter of credit is irrelevant in this context because, by definition, it must reflect the conditions and terms which are included in the sales agreement, i.e. the contract, the Commission rejected this claim for reasons set out in recital (40) above.

(49) At provisional and definitive stage, Ezz Steel submitted that the present case should be distinguished from facts and circumstances of the Bulb Flats (7) and Ceramic Tiles (8) which concerned exports from Türkiye and in which the Commission used the contract date, rather than the invoice date, as the circumstances of these cases do not apply to this case. Since the Commission performed an independent assessment of the facts and figures of this case and no parallels with the cases mentioned above were drawn, this claim was rejected.

(50) Ezz Steel furthermore submitted that the Commission had used the wrong exchange rates for the transactions during the IP related to sales contracts concluded in the three months preceding the IP, i.e. for the period from January to March 2023. They claimed that the Commission should have used the exchange rates in audited financial report of the company, provided to the Commission during the investigation.

(51) The Commission assessed and accepted the company’s claim as regards the exchange rate for March 2023. For January and February 2023, however, the Commission found that the use of the official exchange rate was correct since the problem of exchangeability of the Egyptian Pound as regards normal access to USD in the exchange currency market only became an issue for the company from March 2023, as confirmed in the several financial statements of the company itself (9). There are no monetary reasons not to use the official exchange rate when the monetary market works normally, which was the case until Feb 2023, included, according to Ezz 2023 financial statements. In addition, the 2023 financial statements do not disclose the specific exchange rates of January and February 2023.

(52) Following final disclosure, Ezz steel claimed that the above statement in recital (51) regarding the use of the official exchange rate for the months January and February 2023 by the Commission is wrong, supported by the following documents: Deloitte Report on EZDK pricing during April 2023 till March 2024, World Bank’s Egypt Economic Monitor for December 2022, Audit Committee Q4 2023 minutes and report issued on 20 July 2024 by Moore Egypt Public Accountants and Consultants. However, this last report includes the following disclaimer and scope limitation: ‘(…) The procedures do not constitute an audit or a limited review in accordance with Egyptian auditing Standards or Egyptian Accounting Standards, and accordingly, we do not express any assurance or opinion on the underlying financial information. (…) This Report (…) nor should it be relied upon by any other party other than those to whom it is specifically addressed’. The minutes of the Audit’s Committee of Q4 2023 has the same nature of limitations because it is a purely internal document. As regards the Deloitte and World Bank’s reports, they are not specific and detailed as regards Ezz steel transactions subject to exchange rates for the first two months of 2023. The provisional conclusion in recital (51) was therefore confirmed.

(53) Besides the corrections described above, no other changes in the methodology for comparison as described in recitals (67) to (72) were made. They are thus hereby confirmed.

(54) As described in recitals (36) and (37), following claims from interested parties, the Commission revised the dumping margins.

(56) Following provisional and final disclosure, the Commission received written comments by EUROFER which are addressed in Section 3.2.4.

(57) In the absence of any comments regarding the normal value, recitals (78) to (90) of the provisional Regulation were confirmed.

(58) In the absence of any comments regarding the export price, recitals (91) to (93) of the provisional Regulation were confirmed.

(59) In the absence of any comments regarding the export price, recitals (94) to (100) of the provisional Regulation were confirmed.

(60) EUROFER contested the Commission’s conclusion that there was no dumping of Indian hot-rolled flat steel imports, arguing that the finding was distorted and should be reassessed.

(61) EUROFER submitted that export volumes and prices from India to the Union in Q2 2023 were unusually high, which it believed distorted the dumping calculation. These high volumes were, according to EUROFER, largely the result of quota carryovers under the EU Steel Safeguard mechanism, with 334 000 tonnes carried over from Q4 2022 to Q1 2023 and 422 000 tonnes from Q1 to Q2 2023, resulting in total Q2 exports of 555 000 tonnes – an exceptional surge compared to other quarters. Additionally, Q2 2023 prices reached EUR 740 per tonne, which was unusually high given India’s usual practice of selling excess steel abroad at lower prices after satisfying domestic demand. EUROFER suggests this spike may have been influenced by the removal of a 15 % export duty and other incentive schemes. It argues that calculating dumping over the full period hides this temporary distortion and calls for the use of monthly or quarterly averages instead, a method previously applied by the Commission in other cases involving market volatility.

(62) EUROFER stated that seasonal factors contributed to the unusual high exports to the Union: while Union demand and prices are typically higher in Q2 before the summer slowdown, Indian domestic demand is usually lower due to the start of the monsoon season, incentivizing exporters to export more to the Union. Since the quota carryover system was discontinued in March 2025, EUROFER emphasized that Q2 2023 represented a one-off distortion that should not be averaged across the entire investigation period.

(63) EUROFER submitted the Commission wrongly treated iron ore costs when calculating the normal value. EUROFER contended that Indian producers sold iron ore from captive mines at a loss to comply with government directives. However, the Commission treated these transactions as legitimate procurement costs rather than adjusting them to market-based valuations. EUROFER insisted that cost adjustments should reflect prices that would occur in the ordinary course of trade, including a reasonable profit. Using distorted input prices like below-cost iron ore sales results in an underestimated normal value and, consequently, a misleading dumping margin.

(64) EUROFER therefore requested that, first, the dumping margin for Indian HRF should be recalculated either by removing the influence of Q2 2023 data or by averaging margins on a monthly or quarterly basis. Second, the methodology for determining normal value should be revised to account for fair market-based iron ore prices, including a reasonable profit margin, in line with international trade standards.

(65) The Commission carefully examined these claims. First, it concluded that that EUROFER did not properly explain why Q3 would be different from the other quarters. The Commission found that the removal of export duties in India occurred already in November of 2022 and those duties were not reimposed. It is unclear why they would have affected only Q3. Finally, the Commission noted that, following the removal of those duties, exporting producers in India had the option of charging lower export prices or increase prices. They decided to increase prices (and their profits). Thus, the Commission cannot consider that the sales data from Q2 2023 did not reflect actual commercial transactions that occurred within the investigation period. Also, the export sales volumes of the two exporting producers during Q2 2003 were not exceptionally high and there were representative sales in all quarters for both exporting producers. Consequently, these data are representative and valid for inclusion in the dumping margin calculation. The claim was thus rejected.

(66) The Commission also rejected EUROFER’s arguments concerning both seasonality and distorted iron ore input prices. Regarding seasonality, the Commission maintained that the Q2 2023 data – despite EUROFER’s claims of exceptional volume and pricing due to quota carryovers and seasonal market dynamics – reflected actual commercial transactions within the investigation period. As such, it found no legal basis under Article 2(11) of the basic Regulation to deviate from the standard methodology, which considers the full investigation period as representative.

(67) Regarding EUROFER’s claim on iron ore input prices, the Commission found that there was not sufficient evidence which would allow for the replacement of the reported costs with alternative market-based values. First, EUROFER has not indicated the legal basis for the adjustment it claimed. Second, the Commission notes that the ‘sales’ of iron ore referred to by EUROFER are in fact internal transfers, and not a sale between related companies at a loss. The statement in recital (84) of the provisional Regulation refers to sales of iron ore to unrelated customers in the free market, and not to the intracompany transactions. To reflect the actual cost of manufacturing of the product under investigation, the Commission has allocated the realised loss of iron ore sales as a procurement cost to the cost of manufacturing. Therefore, contrary to EUROFER’s claims, the dumping calculation correctly accounted for losses incurred on sales of iron ore. This claim was therefore rejected.

(68) In both instances, the Commission upheld its provisional findings and concluded that the methodology used complied with the legal requirements of the basic Regulation.

(69) In the absence of any accepted claim concerning the dumping margin calculation, recital (102) of the provisional Regulation is hereby confirmed and therefore no dumping of Indian hot-rolled flat steel imports was found.

(71) With regard to point (a), EUROFER claimed that Q2 2023 export prices and volumes were unusually high due to a convergence of policy and market-related factors, including safeguard quota carryovers, seasonal demand patterns, the removal of export duties in November 2022, and the extension of export incentive schemes such as RoDTEP. EUROFER submitted that these elements created a temporary distortion that should have been addressed either by excluding Q2 2023 from the dumping calculation or by adopting a quarterly or monthly comparison methodology under Article 2(11) of the basic Regulation.

(72) The Commission examined these claims and found that they did not warrant a revision of its provisional findings. While the export duty was removed in November 2022, this change applied throughout the investigation period and was not specific to Q2 2023. Regarding the safeguard quota carryover and alleged seasonal demand, the sampled exporting producers had the option of adjusting their commercial strategies accordingly. The Commission found no evidence that the transactions in Q2 2023 did not reflect genuine commercial behaviour.

(73) Moreover, for the two sampled exporting producers, the Commission confirmed that export volumes in Q2 2023 were not abnormally high and that representative export sales existed in all quarters of the investigation period. The Commission further recalled that the dumping margin calculation is based on verified data from sampled exporters, in line with standard Union practice, and that aggregated public import statistics cited by EUROFER cannot put into questions the findings based on detailed data of the sampled companies.

(74) Regarding the legal basis for an alternative methodology, the Commission noted that Article 2(11) of the basic Regulation provides that, subject to fair comparison, the existence of dumping should ‘normally’ be established on the basis of a weighted average comparison over the entire investigation period. This does not preclude deviations where justified, but the Commission found no compelling reasons that would justify the use of quarterly or monthly averages in the present case. Therefore, the claim was rejected.

(75) With regard to point (b), EUROFER reiterated its view that iron ore input costs used to determine the normal value were not market-based, as Indian producers sourced ore from captive mines at a loss under government direction. EUROFER claimed that these prices should have been replaced with values reflecting transactions in the ordinary course of trade, including a reasonable profit margin.

(76) The Commission assessed this claim and found that it was not substantiated. The iron ore inputs in question were not shown to be influenced by government mandates in a manner that would justify disregard of the reported costs. In the absence of verifiable evidence demonstrating distortion or non-commercial pricing, the Commission concluded that the reported costs accurately reflected the producers’ actual cost of production and did not require adjustment.

(77) Consequently, the Commission did not accept EUROFER’s additional comments. The methodology used by the Commission complies with the relevant provisions of basic Regulation, including the fair comparison requirement and Article 2(11). Accordingly, the findings set out in recital (102) of the provisional Regulation were confirmed.

(78) Following the imposition of provisional measures, the Commission received written comments on the provisional dumping findings regarding Japan from GOJ and one sampled exporting producer (Nippon Steel). Other comments received from these parties, or from other companies such as Daido and JFE concerning other aspects of the investigation were treated in the relevant sections (e.g. in Sections 2.1., 4.3.2 and 4.4).

(79) GOJ and Nippon Steel both claimed that some of the companies, which the Commission at provisional stage considered as related companies, should not be treated as related given the little influence of one of the shareholders and the size of the entity controlled as explained in detail below. This concerned the Japanese companies Marubeni-Itochu Steel Inc. (‘MISI’) and Sumitomo Corporation Global Metals Co., Ltd. (‘SCGM’). In the provisional Regulation both companies were considered as related to Nippon Steel since they each held a shareholding interest in a common third entity. In this regard, the Commission noted the following.

(80) First, Nippon Steel itself had reported both MISI and SCGM as related entities from the outset of the investigation. Already as early as 16 September 2024, i.e. five weeks after initiation of the investigation and before the deadline for questionnaire replies, Nippon Steel informed the Commission by email of the relationship between the different companies and indicated that these related entities would provide questionnaire replies. Subsequently, questionnaire replies and deficiency replies were submitted and verification visits were undertaken, all based on the premise that these companies were related to each other.

(81) After final disclosure, Nippon Steel stated that the reason for reporting those companies as related entities was to prevent the Commission from applying Article 18 of the basic Regulation (non-cooperation).

(82) However, if this were the sole reason for reporting these entities, Nippon Steel had ample opportunity throughout the investigation to claim and prove it was not related to those entities, e.g. at questionnaire, deficiency stage and during the verification visit. Nevertheless, Nippon Steel treated the companies as related companies in all these steps and raised the claim only after the imposition of provisional measures. The claim was therefore rejected.

(83) Second, the basic Regulation states in Article 2(1) that ‘In order to determine whether two parties are associated, account may be taken of the definition of related parties set out in Article 127 of Commission Implementing Regulation (EU) 2015/2447’ (10). Letter (g) of that Article 127 provides that persons shall be deemed to be related if ‘together they control a third person directly or indirectly’.

(84) Concerning MISI, Nippon Steel and MISI together held almost 100 % of the shares of a third entity (11), where the two companies together appointed almost all directors, including the president. Concerning SCGM, Nippon Steel and SCGM together held (close to) 100 % of two separate entities (12), either directly or via Nippon Steel’s (undisputed) related entity Nippon Steel Trading Corporation (‘NST’). Nippon Steel and SCGM together appointed (almost) all directors, including the president.

(85) Nippon Steel claimed that in each case one of the two shareholders had less influence on or control over the third entity than the other shareholder. A mere shared ownership of the third entity by itself, therefore, was, according to the company, not enough to conclude that a relationship existed. However, whether one shareholder had less influence on the day-to-day operations of the third entity than the other shareholder does not diminish the objective reality that Nippon Steel and MISI, respectively SCGM, together, fully controlled that third entity.

(86) After final disclosure, Nippon Steel referred to a preliminary ruling (13), where the Court of Justice had explained that ‘one person is to be deemed to control another when the former is legally or operationally in a position to exercise restraint or direction over the latter’. This wording was also reflected in the article referenced in recital (83) as ‘one person is deemed to control another when the former is legally or operationally in a position to exercise direction over the latter’. According to Nippon Steel, the third entities were solely controlled by MISI or SCGM (and for NST Coil Centre, by NST and NSC).

(87) However, the referenced Article 127(g) of Implementing Regulation (EU) 2015/2447 does not concern ‘one person’ controlling another, but related entities (in this case two) together controlling another entity. Although the level of control or influence of one of the shareholders (whether MISI, SCGM, Nippon Steel or NST) was allegedly small compared to the other shareholder(s), this does not negate the conclusion of the previous recital that the entities, together, fully controlled that entity.

(88) In addition, Nippon Steel provided conflicting information as to which of the companies was the main shareholder – Nippon Steel or MISI, respectively SCGM. The shareholding percentages reported in its email of 16 September 2024 were different from those in the company’s submission after provisional disclosure. Moreover, the third entity mentioned in the email of 16 September 2024, owned by Nippon Steel and SCGM together, was no longer mentioned in Nippon Steel’s submission after provisional measures. According to public information, this third entity was fully owned by SCGM and Nippon Steel and/or NST during the investigation period (14).

(89) After final disclosure, NSC provided more information on this third entity (NST Coil Centre, as mentioned in footnote 10). NSC claimed a lack of relationship with this entity in the same vein as set out in recitals (84), (85) and (96), with arguments concerning minority shareholding interests in the third entity, the lack of control or decisive influence through its directors and the size of the third entity in relation to NSC’s business.

(90) Apart from the foregoing, letter (b) of the Article 127 referenced in recital (83) above also states that persons shall be deemed to be related if ‘they are legally recognised partners in business’. The shared ownership of the third entities by Nippon Steel and MISI or SCGM respectively, in and of itself established the existence of a legally recognised business partnership.

(91) After final disclosure, Nippon Steel also argued that Nippon Steel was not a legally recognised partner in business under Japanese law, as would be the case if, for example, the different entities had entered into an agreement to form a so-called ‘kumiai’ (15).

(92) However, the Commission noted that Nippon Steel and MISI or SCGM, respectively, together jointly (directly or indirectly) owned 100 % of the shares of a third entity. Regardless of the legal definition of related companies in Japan under Japanese law, under the referred Article 127 of Implementing Regulation (EU) 2015/2447, the provision normally applied for establishing relationship in trade defence investigations in the European Union, those parties are considered partners in business as joint owners of a third business and therefore related parties.

(93) In addition, Nippon Steel noted that in another investigation concerning electric vehicles from China (16), the Commission had not considered certain Chinese entities as related despite all having joint ventures with a third entity.

(94) Any determination of a relationship between parties should be based on the facts and circumstances of each case. The Commission is not bound by past practice. The electric vehicles case concerned a subsidy investigation, with specific facts that were taken into account in the context of all relevant facts and circumstances of that case, including the specific entities mentioned by Nippon Steel and their contractual arrangements. The current investigation, on the other hand, is an anti-dumping investigation concerning a different country (Japan) and economic reality, a different product/sector, and other facts; i.e. different circumstances than those in the electric vehicles case.

(95) It should be noted that some of the legal representatives for Nippon Steel in this case were the same as those representing the SAIC group in the anti-subsidy investigation concerning imports of electric vehicles from the People’s Republic of China, referenced in Nippon Steel’s submission. This may explain why detailed information was provided on the SAIC group’s ownership structure in the case at hand, although that information cannot be found in the Implementing Regulations concerning that case as it was submitted as confidential business information in the electric vehicles case. It might also explain why Nippon Steel disregarded the fact that in the same investigation concerning electric vehicles, the Commission did consider certain entities of another group as related due to their involvement in a joint venture (17). However, such facts cannot be discussed in detail outside the realm of that investigation, as it concerns confidential and proprietary information to which only the relevant parties involved in that investigation and their legal representatives should have access. No permission of the relevant data owners to use that information in the context of the present investigation was provided to the Commission. In any event, what the Commission did or did not do in other cases has no bearing on the current investigation.

(96) Third, Nippon Steel also claimed that the size of the third entities (in terms of turnover or number of employees) was very small compared to Nippon Steel and that this underlined the limited involvement of Nippon Steel in those entities. However, size could not be accepted as a determining argument showing a relationship or lack thereof.

(97) Fourth, during the investigation period Nippon Steel had a similar relationship with another entity, Metal One. The two companies together owned 100 % of a third entity, as reported by Nippon Steel in their email of 16 September 2024 (18). However, although the situation seemed to be identical to that of MISI and SCGM, Nippon Steel did not claim a lack of relationship with Metal One at any time during the investigation.

(98) Fifth, although the legal representatives of Nippon Steel did mention during the on-spot verification that they did not agree that MISI should be considered a related entity, this was at the time a mere comment. No formal claim was made with respect to this issue, and no argumentation or supporting evidence was provided until after the imposition of provisional measures. It should be noted that it was not the Commission, but Nippon Steel itself who declared MISI and SCGM as related entities from the very beginning of this investigation and who ensured that these entities provided the requested information as related entities. Only after seeing the outcome of the dumping calculations, and, presumably, the impact of the companies’ relationships on those calculations, did Nippon Steel decide to make a claim regarding relationships.

(99) In view of the above, the Commission concluded that there was a relationship between Nippon Steel on the one hand and MISI, respectively SCGM on the other hand, based on a joint ownership of a third entity which the companies controlled together and which established their legally recognised business partnership. Consequently, the Commission rejected the claim that these companies should not be considered as related entities.

(100) Nippon Steel claimed that its export sales to its related companies were conducted on arm’s length terms. To support this claim, Nippon Steel argued that Nippon Steel’s sales to NST, MISI and SCGM had similar framework agreements, that the related entities were free to buy from other suppliers and that sales to these entities were made at similar prices. Furthermore, MISI’s sales to its related company in the Union, Marubeni-Itochu Steel Europe GmbH. (‘MISEA’), were at arm’s length since MISI’s sales to MISEA were allegedly in line with those to unrelated customers in the EU, while MISEA also purchased the product concerned from unrelated entities. In addition, MISEA’s sales to its related Union entity Company A (19) should be considered as done at arm’s length, since Company A also purchased the product concerned from unrelated entities. To support these claims, Nippon Steel provided evidence that the companies were free to buy from other entities as well as ex-works sales price comparisons on a PCN basis.

(101) First, the Commission noted this claim concerning the transactions in question being at arm’s length was made by Nippon Steel after the imposition of provisional measures. Certain entities were reported as related companies, and transactions with those companies were accordingly treated as related transactions by the Commission at provisional stage.

(102) Second, the Commission did not dispute that the different related entities were indeed free to sell and buy from other unrelated companies. It was also true that the framework agreements with related entities that were provided to the Commission were similar in terms of content and conditions. However, the provided framework agreements did not specify how the final prices were set, how commissions (if any) were paid or other details relevant for the determination of arm’s length transactions.

(103) Moreover, by the company’s own assertions in its submission after provisional measures, the price negotiations involving related traders in practice took place either through the trader or directly with the customer, meaning the trader’s influence in these negotiations was limited to acting as an intermediary or ‘go-between’. The final price was therefore mainly determined by the interaction between Nippon Steel and the final customer. In view of the limited (if any) influence of the related trader on the price setting, the price between related entities was considered unreliable.

(104) Third, Nippon Steel claimed that the prices paid by Nippon Steel to or via its related entities were in line with prices paid to unrelated customers. To support this claim, Nippon Steel provided tables showing the ‘ex works’ prices to related and unrelated entities for sales by Nippon Steel itself and by its related entities MISI and MISEA. However, it is unclear which prices were used as ‘ex works’ prices by Nippon Steel. When comparing sales prices, a comparison should be made between the invoice prices, minus relevant transport costs (to account for differences in delivery terms) and minus import duties where applicable. Such comparison showed notable price differences between related and unrelated sales transactions, where in most cases (20) the sales price to related traders were lower than to unrelated traders (up to more than 50 % lower prices on a product type basis). It can therefore not be concluded that the transfer prices to related entities were in line with prices to unrelated entities. In any event, Nippon Steel had not provided any argument or evidence showing that the prices between the related entities reflected market prices.

(105) According to the GOJ in its submission after final disclosure, the application of Article 2.3 of the WTO Anti-dumping Agreement was not justified by the lower sales prices of the relevant transactions, since that Article addresses the difficulty to calculate dumping margins due to the ‘unreliable’ (unreasonably high)’ export prices.

(106) However, Article 2.3 does not specify whether prices between related entities should be higher or lower to trigger its application, it merely requires the existence of an association which renders the export price unreliable. In any event, in this particular case, there were significant price differences for sales between Nippon Steel and its related entities and those between Nippon Steel and its unrelated entities and therefore the GOJ’s claim is also factually incorrect.

(107) In view of the above, the Commission rejected Nippon Steel’s claim and concluded that there was no evidence that prices between related entities were at arm’s length or that they reflected market prices.

(108) The details of the calculation methodology of the normal value were set out in recitals (104) to (116) of the provisional Regulation. In the absence of any specific claims related to the calculation of the normal value, these recitals are hereby confirmed.

(109) The details of the calculation of the export price were set out in recitals (117) to (119) of the provisional Regulation.

(110) Following provisional disclosure, Nippon Steel made two claims related to the calculation of the export price. These concerned the deduction of profit for sales via related entities and the exclusion of dividends and other income in the SG&A costs.

(111) First, the company claimed that the amount for profit of sales through related entities (whether importers in the Union or traders outside the Union) should be deducted only once, in line with previous investigations such as Plain Paper Photocopiers (21) and Polyester Staple Fibre (22). In Plain Paper Photocopiers for instance, the definitive Regulation mentioned in recital (70) that a single profit margin of 5 % was applied, irrespective of the number of subsidiaries involved in the sales chain.

(112) The Commission notes that Nippon Steel’s claim mixed up the adjustment made to the export price under Article 2(9) of the basic Regulation when sales were made through related importers and adjustments made for fair comparison under Article 2(10) for sales made through related traders acting as agents in Japan. Those adjustment, however, have different factual and legal basis and therefore cannot be treated together.

(113) The Commission notes that the approach taken (which refers only to Article 2(9)) reflected the specific circumstances of those cases at that time, in particular the type of product and sales flows. Nippon Steel has not explained why the approach in the referenced cases would be relevant for the case at hand, in particular when its claim covers also an adjustment under Article 2(10)(i). The findings in those cases, therefore, cannot be applied as such in the current investigation.

(114) For the case at hand, the Commission made an adjustment of 2 % for profit incurred by each Union related entity involved until resale to the first independent Union customer in accordance with Article 2(9). Nippon Steel has not challenged that the adjustment under Article 2(9) was unwarranted but merely that, combined with the adjustment under Article 2(10)(i), it was too high.

(115) In view of the above, the Commission rejected Nippon Steel’s first claim.

(116) Following final disclosure, Nippon Steel clarified that it took issue with the fact that the Commission made a double adjustment under Article 2(9) for sales made via MISEA and Company A. According to the company, this would be the exact same situation as mentioned for the two cases referenced in recital (111).

(117) The Commission disagreed. In those two referenced cases the Commission decided to use one single profit margin regardless of the number of entities involved. In those cases, a profit margin of 5 % was used to reflect the profit made by related importers in case of a complex flow involving multiple entities.

(118) The situation in the case at hand involved a relatively simple flow of two related importers, for each of which the Commission decided to adjust the export price in view of the role played and functions taken by the two related parties. In this regard, depending on the transaction they were both involved in the importation process and further resale on the Union market.. It should be noted that this approach was in fact to the company’s benefit. If the Commission had chosen to follow the example of the older cases referenced by Nippon Steel and had applied a profit of 5 % regardless of the number of subsidiaries, this would have decreased the export price and thereby increased the dumping margin. The fact that the product was sold to the final unrelated customer only once, as argued by Nippon Steel, does not detract from the fact that the goods were, in some cases, sold twice: once by MISEA to Company A and once by Company A to the independent customer. Both MISEA and Company A would expect to make a profit on these sales, and such profit would therefore have to be deducted twice. This is in line with Article 2(9) of the basic Regulation which allows adjustments for, amongst other, ‘profits accruing’.

(119) Second, Nippon Steel claimed that certain dividends related to the product concerned should be included in the SG&A costs. To support this claim, Nippon Steel explained that the relevant amounts for MISEA, MISI, NST and NSC all related to dividends from related companies involved in steel trading. However, the Commission considered these amounts as the redistribution of profit between related entities and as such, not part of SG&A costs. Following final disclosure, Nippon Steel claimed that since those dividends were a return on investments linked to resales of the product concerned by related parties, they should have been taken into account as part of SG&A costs. However, regardless of whether or not these amounts concerned the product concerned, they were paid out between related entities due to investments in such related entities. These amounts could therefore not be considered as part of SG&A, but only as a redistribution of profit between those related entities. Furthermore, and in any event, Nippon Steel did not demonstrate that the dividends were directly linked to the production and sale of the product concerned. The Commission therefore rejected Nippon Steel’s claim.

(120) Following the imposition of provisional measures, Nippon Steel made three claims with regard to the comparison between the export price and the normal value.

(121) First, as stated in recital (111), Nippon Steel claimed that the amount for profit of sales through related entities (whether importers in the Union or traders outside the Union) should be deducted only once. However, as noted in recital (112), the company mixed up adjustments made under different factual and legal basis and therefore the claim was rejected, as explained in recitals (113) to (115).

(122) Nippon Steel claimed that for sales to the Union via unrelated traders, the Commission should add an amount for SG&A costs and profit of those unrelated traders to the CIF prices they themselves had provided to the Commission during the investigation. According to Nippon Steel, the Court of Justice’s judgment in the Hansol case (23) implied that competition at the EU border takes place at the point of resale to the first independent customer in the Union, not in Japan or elsewhere.

(123) The Commission noted that this claim was made for the first time only after provisional disclosure while at provisional stage, the company itself had supplied questionnaire replies including an estimated CIF price for Union sales made via unrelated traders. At no point in time did the company propose or request to include in that CIF price the SG&A and profit of the unrelated traders, while the company had ample time to do so. Only after the imposition of provisional measures did Nippon Steel claim adjustments.

(124) Nevertheless, in view of the specific circumstances of this case and in particular the fact that Nippon Steel also exported to the Union via related traders for which the relevant CIF prices were verified to include SG&A costs and profit, the Commission exceptionally agreed that it would be reasonable to reflect an amount for SG&A costs and profit for the unrelated traders in the CIF prices pertaining to the export transactions made via the unrelated traders concerned. With their submission, Nippon Steel had supplied the non-consolidated financial statements of four of the five unrelated traders involved in Union sales during the investigation period. However, those costs and profits did not cover all traders, while they did include the operations of those traders related to other business and other products than the product concerned. Moreover, the type of costs included in the SG&A for those unrelated traders was not specific enough to avoid double-counting of e.g. transport or other costs. The Commission therefore did not consider these costs and profits as reasonable.

(125) As an alternative, Nippon Steel had suggested using as a proxy the verified SG&A and profit as reported by the related traders MISI or NST. The Commission considered that the weighted average of the relevant and verified SG&A costs of the related traders MISI and NST would indeed be a reasonable proxy for the unrelated traders’ SG&A. With regard to profit, however, the profit of the related traders was considered unreliable since that profit was affected by the relationship with Nippon Steel.

(126) The Commission instead considered using a notional profit margin of 2 %, which would be consistent with the profit margin used under Article 2(9) for Union sales via related companies, as explained in the provisional Regulation in recital (119) and Nippon Steel’s specific disclosure at the time of provisional measures. The Commission considered this a reasonable proxy. On this basis, the Commission recalculated the dumping and injury margins.

(127) After final disclosure, Nippon Steel claimed that the VAT taxes on invoices for export sales through Japanese unrelated traders should not be deducted. According to Nippon Steel, the VAT paid by the unrelated traders to Nippon Steel following a domestic sale to these unrelated traders can be included in the deduction value in the traders’ tax declaration. However, the facts of this case showed that for these sales, Nippon Steel did not export directly to the unrelated EU customer, but via an unrelated domestic trader. Under these circumstances, the approach taken by the Commission was confirmed as any such rebate would be provided to the unrelated trader and not Nippon Steel. No evidence was provided by Nippon Steel showing that this VAT element affected the price with the unrelated trader and no evidence was provided showing that the relevant VAT payments were indeed refunded, deducted or otherwise offset for the export transactions made by the unrelated traders. The Commission therefore did not accept this claim.

(128) Third, Nippon Steel claimed that the Commission should not deduct credit costs from the export price for the related selling entities in the Union. The Commission accepted this claim.

(129) As described in recitals (120) to (128), following claims from interested parties, the Commission revised the dumping margins.

(131) Following provisional and final disclosure, the Commission received written comments by EUROFER and Hoa Phat Group.

(132) EUROFER resubmitted comments on existence of ‘a particular market situation’ in Vietnam, within the meaning of Article 2(3) of the basic Regulation. It argued that the Government of Vietnam provided domestic steel producers with inputs at distorted, artificially low prices, and that therefore, together with the export restrictions on raw material, these distortions justify adjustment of costs in accordance with Article 2(3) of the basic Regulation. To support these arguments, EUROFER first referred to statements in working documents or legislation in Vietnam mentioning a need for development of steel industry and support to domestic steel producers. Secondly, it referred to the existence of export taxes or restrictions on coal, scrap, and iron ore.

(133) Hoa Phat Group rebutted the arguments by EUROFER arguing that no particular market situation nor raw material distortions existed in Vietnam and that EUROFER brought no additional evidence compared to the information submitted at a complaint stage and before the provisional regulation.

(134) As concluded in recitals (286) to (287) of the provisional Regulation, the Commission recalled that existence of distortions of the price of the raw material could not be established. Since in Vietnam, the raw material of the quality needed for the production of the product concerned was inexistant or only existed in minor quantities, the exporting producers imported the raw material from several different suppliers and countries. Therefore, it could not be established that raw material prices would be artificially low since the prices of these raw material were not affected by domestic prices and could not be subject to distortions. The claim was thus rejected.

(135) After the final disclosure, EUROFER reiterated that despite that the production inputs were partially imported into Vietnam, their prices might still be indirectly distorted due to the broader market structure and state interference, export restrictions and duties. The prices might have been as well distorted because of the low priced HRF imported from China, and by the explicit government strategies aiming at promoting and supporting the domestic steel industry. It argued that all these elements indicated that a particular market situation existed in Vietnam. EUROFER as well considered that even if the existence of the ‘particular market situation’ was not confirmed, based on the information available and provided to the Commission by EUROFER, Vietnamese domestic sales prices could not be relied upon for purposes of calculation of the normal value. It therefore requested the Commission to revisit the assessment.

(136) After the final disclosure, Hoa Phat Group submitted that the Commission rightfully concluded that the complainant’s claims on the existence of a particular market situation in Vietnam within the meaning of Article 2(3) of the basic Regulation were without merit, and that the evidence contained in the complaint with regard to the alleged particular market situation in Vietnam was not adequate nor accurate. It considered that the raw materials in Vietnam could not be subject to distortions, given that such raw materials were not affected at all by domestic prices.

(137) The Commission considered that the claim of EUROFER was not based on any new evidence on the existence of the particular situation in Vietnam, nor it could be established the prices of the inputs were distorted – to the contrary, the prices were found in line with international prices. Therefore, it was not appropriate to replace these costs. The Commission thus rejected the claim.

(138) In the absence of any comments regarding the export price, recitals (150) to (151) of the provisional Regulation were confirmed.

(139) In the absence of any comments regarding the comparison, recitals (152) to (156) of the provisional Regulation were confirmed.

(140) In the absence of any accepted claim concerning the dumping margin calculation, recital (161) of the provisional Regulation is hereby confirmed.

(142) In the absence of any comments regarding the definition of the Union industry, recitals (162) to (167) of the provisional Regulation were confirmed.

(143) The term ‘captive consumption’ included both ‘captive sales’, (i.e. transfer within the Group at non-market prices (i.e. not at an arm’s length)) and ‘captive use’, (i.e. internal transfer of HRF for the production of downstream steel products such as tubes for examples). In the absence of any comments regarding the Union captive consumption, recitals (172) to (178) of the provisional Regulation were confirmed.

(144) The verification visit held at the premises of EUROFER and referred to in recital (19) revealed that certain sales between related parties, which were made at arm’s length and thus could not be considered as captive, during the IP for one of the 22 Union producers, had erroneously not been taken into account as free market sales. Therefore Tables 4, 5, 6 and 10 of the provisional Regulation were revised and disclosed to parties in the General Disclosure Document (GDD) to include those non-captive sales volumes.

(145) In a further analysis, the Commission revised its assessment whereby the methodology used for calculating the consumption in the Union free market as presented in the provisional Regulation was actually correct as non-captive sales, at arm’s length, to related parties such as traders and Steel Service Centres had correctly been included in the assessment of the Union free market consumption in Table 5 of the provisional Regulation for all Union producers and confirmed in Table 3 below.

(146) In any case, it has been investigated and confirmed that these non-captive sales are indeed sales at market prices and that the related buyer had a free choice of supplier, irrespective of whether this supplier was related or not.

(147) In this regard, the Commission has included all non-captive sales in the Union free market data on top of the sales by the Union producers to unrelated customers and the imports from third countries. This limited change had no material impact on the conclusions outlined in the provisional Regulation as explained below.

(148) Nippon Steel and JFE submitted that Union producers have been importing the product under investigation into the EU in considerable volumes throughout the investigation. This point is addressed in detail, in Section 4.3.2, recitals (173) to (180). The Commission noted that while cross-checking the information on imports of HRF, the Commission found a clerical error in recital (191) of the provisional regulation with regard to the evolution of the total market share of the imports from the countries concerned into the Union. While the market share indeed went up by almost 4.1 percentage points, the increase in market share amounted to 87 % and not 56 % in the period considered as erroneously indicated (see Table 2).

(150) The overall Union consumption in 2022 dropped by 13 % as compared to 2021. Captive consumption represented 49,9 % of overall Union consumption in the investigation period and dropped by 16 %.

(151) Following the imposition of provisional measures, FHS stated that the Commission should use the same CN codes to extract Eurostat import data as the ones used to establish EUROFER’s production figures. FHS argued that in taking such asymmetric approach, the Commission artificially enlarged the consumption denominator and automatically diluted the calculated market shares of both the Union industry and the countries concerned.

(152) The Commission established the import statistics for HRF on the basis of Eurostat data by applying the CN codes under which the like product would be falling. The Commission also ensured that the same specific CN code was used by the sampled Union producers and EUROFER to report micro and macro-indicators and in particular production volume.

(153) FHS argued that the share of captive consumption (i.e. internal transfers for further processing of the product under investigation without invoicing and entering into free market, and ‘captive sales at non-arm’s length transactions with related companies for further processing’) should be considered in the overall production of hot-rolled flat steel products. In the view of this exporting producer, almost three-quarters of the overall contraction in apparent consumption originated inside vertically integrated groups. According to FHS, captive demand fell by more than 6 million tonnes, whereas free-market demand shrank by fewer than 2 million tonnes.

(154) Therefore, in the view of this exporting producer, before attributing any injury to imports from the countries concerned, the Commission should have first demonstrated that those imports gained a disproportionate share in a context of overall declining market demand. In the view of this exporting producer this would have strong impact on the final injury determination.

(155) The Commission has closely examined the question of ‘captive consumption’ (see recital (143)) and ‘captive sales’ which is highly relevant in the investigation at hand. In the provisional Regulation, it has considered sales in the open market (without including non-captive sales as explained in recital (146)) separately from the captive consumption in its injury assessment, as the latter was not considered to be subject to free market conditions.

(156) The Commission noted that while some of the Union producers have related companies either trading or processing the like product, also their sales to these related entities are done at arm’s length and that these related entities are allowed to purchase from all suppliers, including those from the countries concerned and not just from a related primary steel makers and all these purchases are done at market price. Thus, all non-captive sales to related parties were included in the volume or value thereof.

(157) The claims that almost three-quarters of the overall contraction in EU consumption originated inside vertically integrated groups was found to be correct, however, they did not affect the conclusions that the EU sales volumes, including non-captive sales to related parties declined by 15 % as shown in the revised Table 2 (Table 4 in this Regulation).

(158) FHS argued that the 13 % drop in the Union overall consumption between 2021 and the IP as reported in Table 5 of the provisional Regulation coincided with a ‘well-documented’ slowdown in the EU construction, automotive and pipeline sectors following the 2022-2023 energy-price shock.

(159) However, no underlying evidence was given with regard to the fact that HRF is solely used in those sectors and in which quantities. According to FHS, that macro-shock affected every supplier equally. Before attributing any injury to imports from targeted countries, the Commission should have first demonstrated that those imports gained a disproportionate share within the shrinking pie —something, which in FHS view was not established on the basis of the data in Table 6 of the provisional Regulation.

(160) The Commission disagreed with this statement. First, the statistics reported in Table 6 of the provisional Regulation showed that the trend of imports from the countries concerned did not follow the same trend as the overall Union industry's production volume, which, as shown in Table 9 of the provisional Regulation, decreased by 16 % as a consequence of the combined decrease in sales in the free markets. Secondly, FHS did not provide any evidence regarding these alleged ‘well-documented’ slowdown in the EU construction, automotive and pipeline sectors following the 2022-2023 energy-price shock or that HRF was only used in these sectors. These claims were therefore rejected.

(161) After final disclosure, FHS pointed to the fact that the Commission had offered ‘at least three different estimates of the Union industry’s market share loss’ and argued that the Commission should disclose ‘the revised spreadsheet that underpins Tables 2 – 4 of the GDD and clearly identify which market share figure it considers to be authoritative’.

(162) First, the alleged lack of clarity regarding the methodology used for calculation of the respective market shares of the Union industry and third countries was explained in detail in recital (189) of the provisional Regulation and Section 4.2 of the final General Disclosure Document. Second, some information could not be disclosed and had to be presented using ranges in order to ensure the confidentiality of the data pertaining to other parties, including from other exporting producers originating in Vietnam. In any case, all reported figures show a similar downward trend when it comes to the market share of the Union industry. The arguments of FHS were therefore rejected.

(163) The changes mentioned above in recital (144) with respect to Union consumption, did not affect the conclusions set out in recitals (168) to (182) of the provisional Regulation.

(164) Following the imposition of provisional measures and after the final disclosure, Ezz Steel argued that the imports from Egypt to the European Union should be considered negligible both in terms of volumes and market shares, with in addition a low-level increase in percentage of 4 % from 2021 to the IP. Furthermore, there were different conditions of competition between imports from Egypt and the hot-rolled flat products produced by the Union industry as according to this exporting producer, Egypt should be considered as a price follower as it had the highest average import prices compared to Japan and Vietnam from 2022 to the IP, and Egyptian imports did not undercut EU sales prices in the IP. Ezz Steel also argued that the market shares should be calculated on the basis of the Union’s overall consumption set out in Table 5 of the provisional Regulation which includes sales on the free and captive consumption markets.

(165) The Commission noted that some of these allegations with regard to the conditions set out in Article 3(4) of the basic Regulation and to the cumulative assessment of the effects of imports from the countries concerned had already been submitted by Ezz Steel and addressed by the Commission at provisional stage, in particular recitals (183) to (188).

(166) First the Commission noted that, in this particular case, imports of the product under investigation originating in the countries concerned accounted individually for at least [2,2 – 2,9] % of market share in the investigation period and for [7,6 – 10,1] % when considered together during the investigation period, as reported in Table 2 below. Furthermore, the Commission disagreed with the claim of Ezz Steel that its market shares should be calculated on the basis of the Union’s overall consumption and not on the total Union free market consumption. The Commission considered that the imports from Egypt should be compared with the total free market, excluding captive consumption which are not subject to the same conditions of competition as in the free market.

(167) As per its standard practice in anti-dumping investigations, the Commission established the Union free market consumption on the basis of (a) the sales on the Union free market of all known producers in the Union; and (b) the imports into the Union from all third countries as reported by Eurostat, thereby also considering the data submitted by the cooperating exporting producers in the countries concerned. In the absence of new claims in the comments submitted on the GDD, the conclusions were maintained.

(168) After final disclosure Ezz Steel highlighted a discrepancy in the Commission’s approach regarding the calculation of the market share of the volume of imports of the product concerned from Egypt during the investigation period. According to this exporting producer, the Commission’s approach to consider the total Union free market consumption instead of the overall consumption as a basis to calculate the market share of imports from Egypt contradicted the methodology adopted in the safeguard regulation (24), where it included captive sales in its determination of consumption for all product categories including HRF.

(169) In the present investigation, the Commission conducted a detailed analysis of the Union market, assessing both the free and captive markets of HRF. Therefore, it is incorrect to imply that the Commission disregarded the situation in the combined market in the present case. The same approach was followed in previous anti-subsidy and anti-dumping investigation concerning Brazil, China, Russia, Iran, Türkiye or Ukraine. Therefore, the claim was rejected.

(170) Ezz Steel referred to its previous submission made at initiation stage which included figures set out in a ‘CRU Report’ (25) on EU HRC Market Consumption, arguing that by not addressing this point raised by Ezz Steel, the Commission breached its obligation to state reason. However, as explained in recitals (162) to (164) and (171) of the provisional Regulation, as well as in recital (152) above, the Commission used the verified sales data of no less than 22 companies producing the like product which was coupled to Eurostat data regarding imports from third countries to allow it to obtain data for the entire consumption of the like product in the Union. Hence, there was no need to revert to other commercial unverified sources as reputable they may be.

(171) Ezz Steel furthermore argued that by using the overall consumption, the market share of Ezz Steel would be no more than 1,25 %. It furthermore alleged that the Commission’s approach led to inaccurate results that do not reflect normal market conditions insofar as those shares would be largely dependent on the unilateral conduct of the EU HRF primary steel producers, either by taking over downstream processing companies or by deciding to divest its related downstream processing companies. Therefore, the Commission artificially overinflated the EU market share of Egyptian imports of HRF when in fact it could be considered as warranting a termination of the investigation as was the case for Serbia in a previous anti-dumping investigation (26).

(172) First, in accordance with its standard practice, the Commission assessed the imports from the countries concerned in the free market, on which they are in competition with the Union industry. Against the background of Article 3(4) of the basic Regulation which refers to the effects of the imports from the countries concerned, the Commission failed to see how the share of imports from the countries concerned should not be compared with the free market sales of the Union industry, with which they compete, to assess the cumulation of imports from the countries concerned and their effects on the performance of the Union industry. The Commission found that Egypt was not in the situation as Serbia in that case. The Commission found in the case concerning Serbia (27) that 1,04 % was still negligible under Article 3(4) of the basic Regulation, because 0,04 percentage points (pp) should be regarded as immaterial, in particular when, in relative terms, Serbian import volumes were considerably lower than the volumes from each of the four other countries investigated. Conversely, in the present case, using the same methodology to calculate consumption as that followed in the Serbian case, the Commission established that Egypt had [2,2 – 2,9] % market share during the investigation period, which is more than double the threshold established in Article 5(7); it cannot therefore be considered as ‘negligible’. Furthermore, the dumped imports from the other two countries concerned in this case had similar market share, in particular Vietnam ([2,3 – 3,3] %). Thus, unlike claimed by Ezz Steel, the situation in the two cases is clearly different, and does not justify treating Egypt the same way as Serbia. The claim was therefore rejected.

(173) As mentioned in Recital (19), Table 6 of the provisional Regulation had to be updated to take into account the non-captive sales volumes to related parties in the IP of one of the Union producers.

(175) Nippon Steel and JFE argued that the decline of market shares of only 2 percentage points during the period considered should not be considered as an ‘indicator of the deterioration of the competitive position of the Union steel producers’ as stated in recital (212) of the provisional Regulation. Both parties raised in particular the fact that the Union industry maintained a dominant position on the EU market, with a market share of 70,2 % by the end of the IP, declining by only 0,6 percentage points from 2023.

(176) As explained in recital (212) of the provisional Regulation, the decrease in sales volume in the Union free market and the loss of Union industry's market share significantly exceeded the decrease of consumption in the Union free market, which is an indicator of the deterioration of the competitive position of the Union steel producers. Furthermore, as clarified in recital (190) of the present Regulation, the drop in market share of the Union industry on the free market amounted to 3,4 percentage points as mentioned in the revised Table 5 below and not 2 percentage points as mentioned in the provisional Regulation.

(177) Nippon Steel and JFE noted that Union producers have in fact continued to import hot-rolled coils (‘HRC’) and slabs into the EU since the initiation of the investigation, despite the allegation made in the complaint that imports from Japan, Egypt and Vietnam were preventing them from increasing their production. According to these two parties, Union steel primary and secondary producers imported over 220 000 tonnes of HRC and in total, the Union industry imported almost 4 million tonnes in 2023 from the countries concerned out of a total of 8 million tonnes from the rest of the world. No evidence was provided by these parties regarding the imports of slabs by Union primary steel producers and the investigation did not reveal any information in this regard.

(178) FHS argued that the alleged methodological errors mentioned in recitals (20) and (151) exaggerated both the scale and the competitive impact of imports from Vietnam. FHS reiterated that the choice of 2021 as the index base year distorted the picture as import volumes recorded that year were abnormally depressed because Russian and Turkish supplies were still flowing freely, while Asian mills were struggling with pandemic-related freight bottlenecks. The 56 % increase of imports during the period considered therefore reflected only the replacement of trade flows from these two countries which were subject to either sanctions for the previous or anti-dumping measures for the latter.

(179) The Commission contended that the replacement of imports by the countries concerned, might indeed be the result of measures taken against Russian and Türkiye. However, it remains that those imports from the countries concerned were found to increase in significant quantities to the detriment of the Union industry, be dumped and injurious to the Union industry.

(180) In the absence of any other comments regarding the imports from the countries concerned, recitals (189) to (191) of the provisional Regulation were confirmed.

(181) In recitals (192) to (197) of the provisional Regulation, the Commission detailed the methodology to determine the price undercutting, and it concluded that the imports from the countries concerned undercut and suppressed the Union industry prices.

(182) The dumped imports from the majority of the sampled exporting producers concerned were found to undercut the Union industry prices in a range between – 3,3 % and 10,1 % as can be seen in Table 8 of the provisional Regulation.

(183) Following the imposition of provisional measures, Ezz Steel considered that the average prices of imports from Egypt were relatively high and did not undercut EU sales prices. Therefore, these imports could have not caused injury to Union producers. Given the nature of these comments, they are addressed in Section 5.1 below.

(184) FHS argued that the 3,3 % undercutting established for its imports corresponded to the freight differential and currency fluctuations that routinely separated FOB offers in Asia from EU steel mills quotes and therefore, could not be considered as injurious for the Union industry. After final disclosure, FHS further argued that the Commission failed to provide a thorough analysis as to why such undercutting margin of 3,3 % for FHS was economically significant in the context of the EU HRF market.

(185) As mentioned in recital (242), the investigation also revealed that the Union industry’s prices were suppressed by the low-priced imports originating inter alia in Egypt. In the context of price suppression, it is not surprising that the undercutting is not significant as the Union industry is prevented from increasing its price due to the price pressure incurred.

(186) The Commission recalled that as explained in recital (194) of the provisional Regulation, the price undercutting during the investigation period was assessed by comparing: the weighted average sales prices per product type of the three Union producers charged to unrelated customers on the free Union market, adjusted to an ex-works level; and the corresponding weighted average prices at CIF Union frontier level per product type of the imports from the cooperating producers of the countries concerned to the first independent customer on the Union market, established on a Cost, Insurance, Freight (CIF) basis, with appropriate adjustments for post-importation costs. While the price undercutting may have various causes, the undercutting calculation was made based on the verified data provided by FHS.

(187) On this basis, the Commission confirmed the undercutting margin established in recital (196) of the provisional Regulation. The claim was therefore rejected.

(188) In the absence of any other comments regarding the imports from the countries concerned, recitals (192) to (197) of the provisional Regulation were confirmed.

(189) In the provisional Regulation (Section 4.4), the Commission detailed the macroeconomic and microeconomic indicators of the Union industry in the period considered. It concluded, in recital (238) of the provisional Regulation, that the Union industry suffered material injury within the meaning of Article 3(5) of the basic Regulation.

(190) As mentioned in recital (19) and (131) to (142), the verification visit held at the premises of EUROFER, revealed that the non-captive sales data to related parties by one of the complainants had not been included in the overall non-captive sales data pertaining to the IP. The Commission also made some adjustments to the relevant tables in order to include non-captive sales in the free market consumption. This had consequences for Tables 5 and 6 of the provisional Regulation as mentioned above, but also for Tables 4 and 10 of the provisional Regulation. The captive consumption table of the provisional Regulation remained unchanged.

(191) After final disclosure, quoting Article 3.2 of the WTO ADA, FHS claimed that the Commission should have either included captive volumes in all injury indicators or re-calculated them on a consistent free-market-only basis. Furthermore, according to FHS, the Commission did not meet the transparency and disclosure obligations under Article 6.5.1 of the WTO ADA and Article 3(2) of the Basic Regulation by not disclosing the exact amount and percentages which were changed.

(192) The Commission first noted that it followed the same consistent approach as in previous investigation concerning HRF whereby captive volumes were only taken into account where warranted, i.e. where no distinction could be made regarding the destination of the products given the nature of the indicator. Hence, as investments or production relate to both captive and free market operations, they could only be assessed jointly regardless of the destination of the products. On the contrary, profitability was assessed based on the free market sales to reflect free market mechanisms and to take account of the competition faced by Union producers due to the imports from third countries entering the Union market. Second, the Commission was not able for confidentiality reasons to provide exact figures, but provided ranges and indexes for all the necessary data. In addition, in response to NSC and JFE’s comments, the Commission provided further clarification as explained in recital (194) below.

(194) After final disclosure, NSC and JFE contested the Commission’s finding with regard to some injury factors in relation to the economic situation that prevailed during the period 2020 and 2021. This led the Commission to revisit once more the situation regarding the market consumption in the Union and the sales volume and market share of the Union industry on the Union free market. The Commission acknowledged that the error mentioned in recital (19) had no effects on Tables 2, 3 and 4 and in fact, made a double counting of the non-captive sales es as noted in recital (146). In fact, the figures reported in these tables in the provisional regulation already included the non-captive sales. Following the final disclosure, the relevant tables and content were therefore revised, back to the previous volumes, with the exception of the data of one of the 22 Union producers, which remained similar to that used for the GDD.

(195) With regard to NSC and JFE comments regarding the situation that prevailed during the period 2020 and 2021, they argued that the year 2021 was exceptional and highly specific following the COVID-19 crisis which affected the market demand and prices in the previous year. Therefore, whilst the Union industry benefitted from the recovery of the economy after the COVID-19 crisis, using this year as a basis to determine the evolution of the economic situation of the Union industry would automatically and artificially lead to an injurious situation.

(196) NSC and JFE referred in particular to a previous expiry review case concerning China (28). In their submission, they noted that in accordance with the sales volumes reported in the GDD: ‘the sales volume of 30 578 495 tonnes identified by the Commission for 2021 in the present Investigation constitutes a remarkable performance — representing an increase of 21 % on the 2019 figure’ (29). However, following the correction made after the final disclosure as explained in recital (194), the Commission confirmed that unlike what could be indeed deducted from the figures disclosed in the GDD, the correct sales volume of 27 729 413 tonnes reported in Table 4 for 2021 only represented an increase of 9,2 % on the 2019 figure and not 21 % as alleged by the NSC and JFE. This showed that the year 2021 was actually in line with normal market conditions since after dropping to 20 020 000 tonnes in 2020 as found in the expiry review case regarding China, the sales volumes could not be qualified as a ‘remarkable performance’ as claimed by NSC and JFE. Furthermore, the free market consumption in the IP was 33,268 million tonnes, which is also in the range of the consumption observed in 2019. The claim was therefore rejected.

(197) The Union industry sales volume in the Union free market (i.e. excluding captive sales) decreased by 15 % during the period considered from 27,729 million tonnes to 23,570 million tonnes.

(198) During the period considered, the Union industry’s market share in terms of Union consumption went down by 3,44 percentage points, from 74,29 % to 70,85 %. The decrease in sales volume in the Union free market and the loss of Union industry’s market share significantly exceeded the decrease of consumption in the Union free market, which is an indicator of the deterioration of the competitive position of the Union steel producers.

(199) FHS argued that since the production capacity of the Union industry remained unchanged during the period considered, the Commission wrongly attributed the decrease of capacity utilisation resulting from the lower production level to the imports from the countries concerned instead of recognising that the drop of the production was linked to the overall decrease of demand of the product under investigation. Moreover, the decline was concentrated in the captive segment, which went down by 16 % (from 39,2 to 33,1 million tonnes), whereas free-market consumption fell only by 6 %. By the same token, FHS considered that the data indicated that sales volumes fell because the EU market shrank, especially on the captive side, not because suppliers in the countries concerned displaced business from Union producers. Furthermore, considering that the Union Industry controlled about 70 % of the free market and more than 85 % of total consumption, a two percent decrease in market share should be considered as an ordinary competitive variation and could not reasonably be viewed as import-driven injury.

(200) As showed in Table 4 above, and contrary to what FHS erroneously claimed, during the period considered, the Union industry sales volume in the Union free market (as revised after the imposition of provisional measures) and the Union industry captive transfers in the Union market both followed a downward trend dropping respectively by 15 % and 16 % over the period considered in line with the drop in total production of the Union industry as reported in Table 9 of the provisional regulation. However, the percentage of captive consumption compared to the total production remaining stable throughout the period considered ranging from 55,7 % to 56,1 %, this confirmed the existence of sales displacement of the sales of the Union producers in the free market by the exporting producers from the countries concerned which saw their market share increasing at a time when the overall demand was shrinking. This is also confirmed by the sharper decrease in sales on the free than on the captive market which resulted in a loss of 3,4 % percentage points of market share. Furthermore, the loss of Union industry’s sales in the free market significantly exceeded the decrease of consumption in the Union free market, which, as mentioned in recital (212) was an indicator of the deterioration of the competitive position of the Union steel producers.