Case T-88/98

Kundan Industries Ltd and Tata International Ltd

v

Council of the European Union

‛Dumping — Stainless steel fasteners — Calculation of export price — Unreliability of the price — Calculation of normal value — Rights of the defence’

Judgment of the Court of First Instance (Fourth Chamber, Extended Composition), 21 November 2002   II-4901

Summary of the Judgment

1. Common commercial policy — Protection against dumping — Dumping margin — Détermination of the export price — Recourse to a constructed export price — Conditions — Discretion of the institutions — Review by the Court — Limits

   (Council Regulation No 384/96, Art. 2(9))

2. Common commercial policy — Protection against dumping — Dumping margin — Determination of the export price — Recourse to a constructed export price — Whether permissible where there appears to be a compensatory arrangement between the producer and the exporter

   (Council Regulation No 384/96, Art. 2(9))

3. Common commercial policy — Protection against dumping — Dumping margin — Comparison between the normal value and the export price — Adjustments — Burden of proof

   (Council Regulation No 384/96, Art. 2(10))

4. Common commercial policy — Protection against dumping — Conduct of the investigation — Information provided by a concerned undertaking — Challenge by the undertaking itself — Not permissible

   (Council Regulation No 384/96, Art. 18(3))

5. Community law — Principles — Rights of the defence — Observance of those rights in administrative procedures — Antidumping — Duty of the institutions to keep the undertakings concerned informed — Scope

   (Council Regulation No 384/96, Art. 20)

1.  It is apparent from Article 2(9) of the basic antidumping Regulation No 384/96 that the institutions may treat the export price as unreliable in two cases, namely where there is an association between the exporter and the importer or a third party or a compensatory arrangement between the exporter and the importer or a third party. In any other case, where an export price exists, the institutions are required to base their determination of dumping on that price.

   However, the question whether or not the export prices reported by the applicant were reliable necessarily entails complex economic assessments in respect of which the institutions enjoy a wide discretion, so that the Court's power of review is restricted.

   (see paras 49-50)

2.  The method of inferring that there is an association or a compensatory arrangement between the producer and the exporter from the finding that the resale prices charged by the exporter on the Community market are below the purchase price charged to it by the producer is not contrary to either the letter or the spirit of Article 2(9) of the basic antidumping Regulation No 384/96. It is apparent from that provision, and in particular from the use of the term ‘where it appears’, that the institutions have a certain latitude in deciding whether it is appropriate to apply that article and that recourse may be had to the constructed export price not only where the institutions obtain evidence of the existence of a compensatory arrangement but also where such an arrangement appears to exist.

   (see paras 60-61)

3.  It is apparent from both the wording and the scheme of Article 2(10) of the basic antidumping Regulation No 384/96 that an adjustment to the export price or the normal value may only be made to take account of differences in factors which affect the prices and therefore their comparability. That is not the case for a commission which has not actually been paid.

   To be able to make such an adjustment, the institutions must base their decision on factors capable of showing, or of giving rise to the inference, that a commission was in fact paid and was such as to have a definite effect on the comparison between the export price and the normal value.

   Just as a party who is claiming adjustments under Article 2(10) of the basic regulation in order to make the normal value and the export price comparable for the purpose of determining the dumping margin must prove that his claim is justified, it is incumbent upon the institutions, where they consider that they must make an adjustment of that kind, to base their decision on direct evidence or at least on circumstantial evidence pointing to the existence of the factors for which the adjustment was made, and to determine its effect on price comparability.

   (see paras 94-96)

4.  Although Article 18(3) of the basic antidumping Regulation No 384/96 allows an interested party to claim that the institutions wrongly rejected information submitted by that party, it does not give that party the right to have information rejected which it submitted itself.

   (see para. 110)

5.  Pursuant to the principle of the respect of the rights of the defence, the requirements of which are laid down in Article 20 of the basic antidumping Regulation No 384/96, the undertakings affected by an investigation preceding the adoption of an antidumping regulation must be placed in a position during the administrative procedure in which they can effectively make known their views on the correctness and relevance of the facts and circumstances alleged and on the evidence presented by the Commission in support of its allegation concerning the existence of dumping and the resultant injury.

   (see para. 132)