EUROPEAN COMMISSION

Brussels, 19.9.2022

SWD(2022) 294 final

COMMISSION STAFF WORKING DOCUMENT

Accompanying the document

REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND THE COUNCIL

40th Annual Report from the Commission to the council and the European Parliament on the EU’s Anti-Dumping, Anti-Subsidy and Safeguard activities and the Use of trade defence instruments by Third Countries targeting the EU in 2021

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Table of Contents

1.    Overview of the legislation    

1.1.    Anti-dumping and anti-subsidy    

1.1.1.    The international framework    

1.1.2.    The EU legislation    

1.2.    Safeguards    

1.2.1.    The international framework    

1.2.2.    The EU legislation    

2.    General overview of anti-dumping and anti-subsidy investigations and measures    

2.1.    Measures in place    

2.2.    New investigations – recent evolution    

2.3.    Review investigations – recent evolution    

3.    Overview of activities in 2021    

3.1.    New investigations    

3.1.1.    Initiations    

3.1.2.    Provisional measures    

3.1.2.    Definitive measures    

3.1.5.    New investigations terminated without measures    

3.2.    Review investigations    

3.2.1.    Expiry reviews    

3.2.2.    Interim reviews    

3.2.3.    New exporter reviews    

3.2.4.    Anti-absorption investigations    

3.2.5.    Anti-circumvention investigations    

3.2.6.    “Other” reviews (reinvestigations, or re-openings)    

3.3.    Safeguard investigations    

4.    Enforcement of anti-dumping/countervailing measures    

4.1.    Follow-up of measures    

4.2.    Monitoring of undertakings    

5.    Refunds    

6.    Information and Communication activities / Bilateral contacts    

7.    Judicial review: decisions given by the Court of Justice and the General Court    

8.    Activities by third countries targeting the EU    

9.    Activities in the framework of the WTO    

9.1    Dispute settlement in the field of trade defence    

9.2    Meetings of the WTO Anti-dumping, ASCM and Safeguards Committees.    

10.    Audit of the European Court of Auditors    

11.    Export transparency and authorisation scheme for COVID-19 vaccines and their active substances    

1.Overview of the legislation

1.1.Anti-dumping and anti-subsidy

1.1.1.    The international framework

On an international level, unfair trading practices such as dumping and the granting of subsidies were identified as a threat to open markets as early as 1947, when the first GATT agreement was signed. The agreement contained specific provisions allowing GATT members to take action against these practices if they caused material injury to the domestic industry of a GATT member. Today's globalised trade environment is characterised by quicker and cheaper communication and transportation, as well as the coexistence of different models of economic governance. In such a world, trade defence instruments are more relevant than ever. Indeed, trade distortions that underlie the application of these instruments are widespread.

Since the beginning of the GATT in 1947, considerable efforts have been made to harmonise the rules relating to trade defence instruments. During the last GATT round (the « Uruguay Round »), which led to the creation of the World Trade Organisation (WTO) and the detailed Anti-Dumping and Anti-Subsidy Agreements, much of the attention was focused on the procedural and material conditions to be fulfilled before measures can be adopted. The EU played an active role in the negotiation of these agreements, which are reflected in its own legislation. The EU applies its anti-dumping (AD) and anti-subsidy (AS) legislation with rigour and consistency. Unfortunately, many WTO Members lack this type of restraint, thereby affecting negatively also EU operators. The role that the EU plays as a prudent but determined user has therefore also an exemplary function at WTO level. Against this backdrop, the EU also continues to play a leading active role in any efforts to update the WTO rulebook.

1.1.2.    The EU legislation

The EU’s anti-dumping and anti-subsidy legislation was first enacted in 1968 and has since been modified several times. The current basic texts, which form the legal basis of anti-dumping and anti-subsidy investigations in the EU, entered into force in March 1996 and October 1997 respectively. These are in line with the Anti-Dumping and Anti-Subsidy Agreements adopted during the GATT/WTO negotiations. These texts were codified in 2016 to reflect changes previously made. The basic texts are:

–Regulation (EU) 2016/1036 of the European Parliament and of the Council on protection against dumped imports from countries not members of the European Union – Codified Version 1 ,

–Regulation (EU) 2016/1037 of the European Parliament and of the Council on protection against subsidised imports from countries not members of the European Union – Codified Version 2 .

These regulations will overall be referred to as the "basic anti-dumping (AD) Regulation" and the “basic anti-subsidy (AS) Regulation”. Both regulations were last modified by Regulation (EU) 2017/2321 of 12 December 2017 3 and Regulation (EU) 2018/825 of 30 May 2018 4 . 

The EU's legislation contains a number of provisions aimed at ensuring a balanced application of the EU’s anti-dumping and anti-subsidy rules on all interested parties. These provisions include the “EU interest test” and the “lesser duty rule”, which go beyond the Union's WTO obligations.

The EU interest test is a public interest clause and provides that measures cannot be applied if it is established that they are contrary to the overall economic interest of the EU. This requires an analysis of all the economic interests involved, including those of the EU industry and its suppliers, downstream users, consumers and traders of the product concerned.

The lesser duty rule requires that the measures imposed by the EU be lower than the dumping or subsidy margin, if a lower duty rate is sufficient to remove the injury suffered by the EU industry. Such a “no-injury” rate is usually determined by comparing import prices with the cost of production of the EU industry and a reasonable profit margin. Since the 2018 amendments to the basic Regulations, the lesser duty rule does not apply, in principle, in anti-subsidy investigations, which means anti-subsidy measures will fully offset the subsidies that an exporter has received. Also since 2018, in anti-dumping investigations, the application of the lesser duty rule may be modulated under certain conditions relating to evidence of significant raw material distortions in the exporting country.

The Commission can only depart from applying the lesser duty rule after receiving a duly substantiated request and where doing so would be not be against the Union interest. This new practice reflects the increased attention of the EU to tackle unfair and injurious subsidisation and artificial distortions by third countries. The EU is one of the few investigating authorities on a worldwide level that applies the lesser duty rule in such a coherent and comprehensive way.

1.2.Safeguards

1.2.1.The international framework

The principle of liberalisation of imports was set under the GATT 1947 and strengthened under the 1994 WTO Agreements. As safeguard measures consist of the unilateral withdrawal or suspension of a tariff concession or of other trade liberalisation obligations formerly agreed, they have to be considered as an exception to this principle. Article XIX GATT 1994 and the WTO Agreement on Safeguards do not only impose strict conditions for the application of this "escape clause", but also put in place a multilateral control mechanism under the WTO Committee on Safeguards.

Under WTO rules, safeguard action has to be viewed as a temporary defence measure that applies to all imports of the product covered by a measure, irrespective of origin. As regards non-WTO members, safeguard measures may be selective and apply to products originating in a specific country. WTO Accession Protocols may also provide for such selective safeguard mechanisms, as was the case in the Protocol of Accession of the People’s Republic of China (PRC), although the provision has now expired.

Definitive WTO safeguards should only be adopted after a comprehensive investigation that provides evidence of the existence of a) unforeseen developments leading to b) increased imports, c) the existence of a serious injury or a threat of injury for EU producers and d) a causal link between the imports and the injury.

Moreover, FTAs concluded by the Union with third countries often include a ‘bilateral safeguard clause’, i.e. a provision that allows for the temporary suspension of tariff concessions made under the FTA.

1.2.2.The EU legislation

The above-mentioned WTO principles are reflected in the relevant EU regulations, except for the “unforeseen development requirement” (which is not found explicitly in the EU legislation nor in the WTO Agreement on Safeguards but has been confirmed as a self-standing condition by WTO jurisprudence, as per Article XIX of GATT 1994). Additionally, the adoption of measures in the EU requires an analysis of all interests concerned, i.e. the impact of the measures on producers, users and consumers. In other words, safeguard action can only be taken when it is in the EU’s interest to do so. The current EU safeguard instruments are covered by the following regulations:

- Regulation (EU) 2015/478 of the European Parliament and of the Council of 11 March 2015 on common rules for imports (codification), 5  

- Regulation (EU) 2015/755 of the European Parliament and of the Council of 29 April 2015 on common rules for imports from certain third countries (recast), 6

- Regulation (EU) 2019/287 of the European Parliament and of the Council of 13 February 2019 implementing bilateral safeguard clauses and other mechanisms allowing for the temporary withdrawal of preferences in certain trade agreements concluded between the European Union and third countries, 7

- Regulation (EU) 2015/936 of the European Parliament and of the Council of 9 June 2015 on common rules for imports of textile products from certain third countries not covered by bilateral agreements, protocols or other arrangements, or by other specific EU import rules (recast). 8

The first two regulations are referred to as the "basic safeguard Regulation(s)".

2.General overview of anti-dumping and anti-subsidy investigations and measures

The number of new investigations initiated in 2021 was similar to the previous year, with 14 initiations (compared to 15 in 2020). The number of measures imposed in 2021 significantly increased as compared to 2020. The Commission imposed 12 new definitive measures and 10 provisional measures giving 22, compared to 17 in 2020. 9 At the same time, 1 new investigation was terminated without the imposition of measures, which brought the total number of new investigations concluded in 2021 to 13. Moreover, during 2021, the Commission initiated 30 review investigations. These included 10 expiry reviews (one of which concerned anti-subsidy measures). The Commission concluded 15 expiry reviews in 2021 confirming the continuation of duties in all cases. Below are details on new investigations and review investigations. 

2.1.Measures in place

At the end of 2021, the EU had 109 definitive anti-dumping measures (which were extended  10 in 31 cases) and 19 countervailing measures in force (extended in one case) 11 .

The anti-dumping measures covered 75 products from 18 countries (see Annex O); The countervailing measures covered 16 products (1 more than in 2020) from 7 countries (see Annex P).

Of the 140 anti-dumping measures in force at the end of 2021, the countries and territories affected were the People’s Republic of China (PRC) (96 measures – an increase of 5 over 2020), Russia (10 measures), US (5), Korea, India and Indonesia (4 each), Taiwan (3), Belarus, Thailand and Ukraine (2 each) and Brazil, Egypt, Iran, Japan, Malaysia, Saudi Arabia, Trinidad and Tobago and Turkey (1 each).

Of the 20 anti-subsidy measures in place, the countries affected were PRC (9), India (4), Egypt and US (2 each) and Argentina, Indonesia and Turkey (1 each).

2.2.New investigations – recent evolution

In the 5-year period from 2017 to 2021, the Commission initiated 66 new investigations on imports from 191 countries.

The main sector concerned by the investigations was Iron and steel with 23 investigations. A breakdown of the other sectors concerned is in Annex B (A).

The countries concerned by the highest number of initiations in the period from 2017 to 2021 include the PRC – 25; Indonesia and Turkey - 6 each, Egypt and Russia – 5 each; India 3, Brazil, Korea and US – 2 each. A table showing all the investigations initiated over the last 5 years broken down by country of export is available at Annex B (B).

Table 1 below provides statistical information on the developments regarding new investigations for the years 2017 – 2021.

TABLE 1

Evolution of new anti-dumping, anti-subsidy and safeguard investigations

during the period 1 January 2017 - 31 December 2021 12

* In the 2019 and 2020 reports, this figure was incorrectly reported as 10. The correction here has had an impact on those figures in the table which were based on it (in italics).

2.3.Review investigations – recent evolution 

Anti-dumping measures, including price undertakings, may be subject, under the basic AD Regulation, to five different types of reviews: expiry reviews (Article 11(2)), interim reviews (Article 11(3)), newcomer investigations (Article 11(4)), absorption investigations (Article 12) and anti-circumvention investigations (Article 13). The Commission also carries out “other” reviews consisting in re-opening of investigations to implement court rulings.

Anti-subsidy measures may also be subject, under the basic AS Regulation, to five different types of reviews: expiry reviews (Article 18), interim reviews (Article 19), absorption investigations (Article 19(3)), accelerated reviews (Article 20) and anti-circumvention investigations (Article 23). In addition, here also, the Commission can re-open investigations to implement court rulings.

Reviews continue to represent a major part of the work of the Commission's TDI services. In the period from 2017 to 2021, the Commission initiated 141 review investigations. These reviews represented over 67% of all anti-dumping and anti-subsidy investigations initiated in that period.

In 2021, the Commission initiated 30 reviews. These comprised 10 expiry reviews (compared to 21 in 2020), 5 ‘new exporter’ reviews, 4 interim reviews (of which 2 anti-subsidy), 4 anti-circumvention investigations, 4 ‘other’ reviews, 2 safeguard reviews and 1 anti-absorption investigation. At the same time, the Commission concluded 22 reviews – 15 of which were expiry reviews (3 concerned anti-subsidy measures).

An overview of the review investigations in 2021 can be found in Annexes F to K. Table 2 below provides statistical information for the years 2017 – 2021.

TABLE 2

Reviews of anti-dumping and anti-subsidy investigations

during the period 1 January 2017 - 31 December 2021 16

3.Overview of activities in 2021

3.1.New investigations

3.1.1.Initiations

In 2021, the Commission initiated 11 new anti-dumping and 3 new anti-subsidy investigations. The categories of ‘Iron and steel’, as well as ‘Other’ stood out in terms of product coverage (other covers such products as ceramic products, bicycles, solar glass). The investigations concerned 7 different countries, with the highest number of initiations concerning the PRC (4 cases). Details of the investigations are given in Annexes A and B.

The list of cases initiated in 2021 can be found below, together with the names of the complainants. More information can be obtained from the Official Journals - publications reference is given in Annex A.

3.1.2.    Provisional measures

In 2021, provisional duties were imposed in 10 new anti-dumping investigations. There were no provisional anti-subsidy measures imposed. 19  

The list of cases where provisional measures were imposed during 2021 can be found below, together with the measures imposed. More information can be obtained from the Official Journal publications to which reference is given in Annex C.

3.1.2.Definitive measures

During 2021, definitive duties were imposed in 11 anti-dumping investigations and in 1 anti-subsidy investigation. The list of cases where definitive measures were imposed can be found below, together with the range of the duties imposed. More information can be obtained from the Official Journals referred to in Annex D.

3.1.4 Details of individual cases with application of new measures

Aluminium extrusions from China (Definitive AD)

On 14 February 2020, the Commission initiated an anti-dumping investigation on imports of aluminium extrusions originating in China. The initiation followed a complaint received from the association European Aluminium, which represented more than 25% of the total Union production of aluminium extrusions. The complaint contained prima facie evidence of dumping and related injury justifying the initiation of the investigation. Following a request from the complainant supported by the required evidence, the Commission made imports of the product concerned subject to registration under Article 14(5) of the basic Regulation in August 2020.

The product under investigation was bars, rods, profiles (whether or not hollow), tubes, pipes; unassembled; whether or not prepared for use in structures (e.g. cut-to-length, drilled, bent, chamfered, threaded); made from aluminium, whether or not alloyed, containing not more than 99,3 % of aluminium. The product is used in a wide range of applications including building and construction, transportation and engineered products.

The investigation of dumping and injury covered the period from 1 January 2019 to 31 December 2019 (IP) and the examination of trends for the assessment of injury covered the period from 1 January 2016 to the 31 December 2019 (IP). Provisional measures were imposed in October 2020.

Sampling

The Commission applied sampling in this investigation selecting the four largest Union producers in terms of production and sales and accounting for just under 10% of production and sales on the Union market. Two importers were selected for the sample on the basis of the largest representative volume of sales of products under investigation originating from China during the IP. The Commission selected three cooperating groups of exporting producers from China representing 28,1 % of total exports to the EU.

Dumping

The investigation found significant State-induced distortions as regards the product under investigation in China. The distortions related to the aluminium sector and particularly to the prices and costs of the product concerned, including the costs of raw materials, energy and labour. As a result, normal value was constructed on the basis of costs of production and sale in Turkey, the selected appropriate representative country in this case.

The cooperating exporting producers exported to the Union either directly to independent customers, through a related importer or through a related company acting as a trader. For direct sales or sales through a related trader to independent customers in the Union, the export price was the price actually paid or payable for the product concerned when sold for export to the Union. For the export sales through a related company acting as an importer, the export price was established based on the price at which the imported product was first resold to independent customers in the Union. For these sales, the Commission adjusted the price for all costs incurred between importation and resale, including SG&A expenses, and for profits accruing. A comparison between normal values and export prices, adjusted where necessary, resulted in a dumping margins for sampled exporting producers of 21,2% for Haomei Group, 25% for PMI Group and 22,1% and 32,1% for other cooperating companies and all others respectively.

Injury and causation

Several injury indicators showed a positive trend such as production, capacity, sales volume on the Union market and employment. However, this related to the increase in consumption and should have increased more strongly, if the Union industry would have been able to benefit fully from the growing market. Despite the increase in sales volume, the Union industry lost 5% market share and while the prices increased by 19 % these did not keep up with increases in costs of 20%. This was because of price suppression caused by the dumped imports. As a result, all financial performance indicators, namely profitability, return on investment and cash flow showed a declining trend, and profits made were below the target profit level during the period considered. Hence, while the market for the product under investigation was growing in the period considered, the Union industry still suffered falling profits, which did not encourage future investments. Given that the Union industry is serving a diverse customer base, which has continuously developing requirements, the Union industry needs to invest in R&D and customer focus solutions to remain competitive. The rapidly deteriorating development of return on investments of ‒ 71% was a serious threat to the continuing viability of the industry. As a result, the Commission concluded that the Union industry suffered material injury.

To examine if the dumped imports were causing the injury, the Commission examined the effect of other factors on the Union industry’s situation including the cost of raw materials, imports from other sources and the export performance of the Union industry. The deterioration in the situation of the Union industry coincided with the increase in imports from China, which were made at prices which undercut the Union industry’s prices and suppressed EU market price levels. The Commission concluded that the dumped imports from China caused material injury to the Union industry and that the other factors did not attenuate the causal link between the dumped imports and the material injury.

Injury margin and level of measures

The duty necessary to eliminate the injury suffered by the Union industry was set at a level that would allow the EU industry to sell at a target price which would cover its costs of production, (including future costs resulting from obligations under Multilateral Environmental Agreements and ILO Conventions), and a reasonable profit. The investigation established a basic target profit of 10%, based on the profitability of the Union industry before the impact of Chinese imports. The injury margin was determined by comparing the weighted average import price of the cooperating exporting producers with the weighted average target price of the Union industry during the IP, which resulted in margins ranging from 30.5% to 65.6%. Given these levels were higher than the dumping margins, the duties to be imposed would be at the level of dumping in line with the legislation.

Union interest and definitive measures

The Commission analysed whether it was in the Union interest to adopt anti-dumping measures. The Commission analysed the various interests involved, including those of the Union industry, importers and users.

Regarding the Union industry, the investigation established that the imposition of anti-dumping duties would restore a level playing field and a fair price level on the Union market, and improve the Union industry’s profitability. As for importers, the Commission recognised that measures were likely to have a certain negative impact by reducing the turnover and profitability of their aluminium extrusions business. However, the Commission concluded that importers would be in a position to pass on the duty to their customers given their significant profit margins of around 7% to 13% and also have the possibility of alternative sources of supply from other third countries and the Union industry. In fact, the investigation showed that both sampled importers had a balanced supply structure and were not reliant on Chinese imports. Several user industries, mainly building, transport, engineering and others including consumer products source the product. Although some users registered as interested parties, most user industries did not cooperate with the investigation and did not submit questionnaire responses. As a result, the Commission did not receive sufficiently detailed information to examine the impact of measures on users in the automotive, construction and other industries. As regards the rail transport industry, the Commission found that the imports of the product for that industry only accounted for a minor part of imports in the Union market and no evidence was provided to support the theory that the imposition of measures would have an adverse impact on that industry. The Commission concluded that the effects of an imposition of duties would not outweigh the positive effects of measures on the Union industry.

Three exporting producers submitted undertaking offers; Haomei Group, Shandong Nollvetec Lightweight Equipment Co., Ltd. and Jilin Qixing Aluminium Industries Co., Ltd. However, the Commission considered the undertakings would be unenforceable and impractical and therefore rejected the offers. The definitive anti-dumping measures were imposed in March 2021 (based on the dumping margin applying the lesser duty rule), and ranged from 21,2% to 32,1%. The Commission decided not to retroactively collect duties for the period during which imports were registered as the conditions to do so were not met.

Aluminium flat-rolled products from China (Definitive AD)

On 14 August 2020, the Commission initiated an anti-dumping investigation on imports of aluminium flat rolled products originating in China. The initiation followed a complaint received from the association European Aluminium, which represented more than 25% of the total Union production of aluminium extrusions. The complaint contained prima facie evidence of dumping and related injury justifying the initiation of the investigation. There was a request to register imports of the products, however the conditions were not met.

The product under investigation was aluminium products, flat rolled, whether or not alloyed, whether or not further worked than flat rolled, not backed, without internal layers of other material, in coils or in coiled strips, in cut-to-length sheets, or in the form of circles; of a thickness of 0,2 mm or more but not more than 6 mm, in plates, of a thickness of more than 6 mm, in coils or in coiled strips, of a thickness of not less than 0,03 mm but less than 0,2 mm, The product is used in a wide range of wide range of applications in sectors such as building and construction, foil, technical applications, transport and consumer durables.

The investigation of dumping and injury covered the period from 1 July 2019 to 30 June 2020 (‘IP’) and the examination of trends for the assessment of injury covered the period from 1 January 2017 to the 30 June 2020 (‘the investigation period’). The examination of trends for the assessment of injury covered the period from 1 January 2016 to the 31 December 2019. Provisional measures were imposed in April 2021.

Sampling

The Commission applied sampling in this investigation, selecting three Union producers accounting for 35% of the estimated total production and 35% of the estimated total Union sales volume of the like product. Three importers were selected on the basis of the largest representative volume of sales of products under investigation originating from China during the IP and the Commission selected three exporting companies/groups of companies representing 18,9% of the estimated total exports from China to the EU.

Dumping

The investigation found significant State-induced distortions as regards the product under investigation in China. The distortions related to the aluminium sector and particularly to the prices and costs of the product concerned, including the costs of raw materials, energy and labour. As a result, the Commission constructed the normal value on the basis of costs of production and sale in Turkey, the selected appropriate representative country in this case. At the same time, the Commission accepted the prices for Titanium Boron Aluminium Rod from one exporting producer which sourced that particular raw material entirely from the UK.

When the sampled exporting producers of the Nanshan Group exported the product concerned to the Union either directly to independent customers or through related companies located in China or in third countries, the export price was that actually paid or payable for the product concerned when sold for export to the Union. Two companies within the Nanshan Group also sold the product concerned to the Union through a related importer. For these sales, the export price was constructed on the basis of the price at which the imported product was first resold to independent customers in the Union. The adjustments made related to all costs incurred between importation and resale, including SG&A expenses and profits, in order to establish a reliable export price at the Union frontier level. Another sampled company, Xiamen Xiashun, exported the products concerned directly to independent customers in the Union and the export price was the price actually paid for the product concerned when sold in the Union. A comparison between normal values and export prices was made with relevant adjustments for transport, insurance, handling and loading, packaging, discounts, credits costs, bank charges and other import charges. This resulted in the following dumping margins: Jiangsu Alcha Aluminum Group Co., Ltd 72,1%, Nanshan Group 55,5%, Xiamen Xiashun Aluminium Foil Co., Ltd 23,7%, Other cooperating companies 44,5%, All other companies 88%.

Injury and causation

Imports of the product from China increased significantly both in absolute (+ 70%) and relative terms (+ 3,9 percentage points in market share) while consumption in the EU decreased by 10%. The import prices were consistently low and significantly below Union industry prices undercutting Union prices by 7% on average. The impact on the Union industry was such that production, capacity utilisation, sales volume in the Union market, market share, employment and productivity deteriorated. Only capacity and captive sales/use showed a positive trend. Sales prices in the EU free market, cost of production, labour costs, profitability, cash flow and return on investments also all displayed negative trends. Only investments showed a positive trend after the sampled producers made investments in order to maintain competitiveness and follow the latest product developments. This deterioration in the situation of the Union industry coincided with the increase in imports from China, which were made at prices which undercut the Union industry’s prices and suppressed EU market price levels.

To examine if the dumped imports were causing the injury, the Commission examined the effect of other factors on the Union industry’s situation including the contraction in demand, imports from other sources, export performance of the Union industry and the Covid pandemic. The Commission concluded that with the exception of the COVID-19 pandemic, which aggravated the situation of the injured Union industry, none of the factors attenuated the causal link between the dumped imports from China and the material injury suffered by the Union industry.

Injury margin and level of measures

The duty necessary to eliminate the injury suffered by the Union industry was set at a level that would allow the EU industry to sell at a target price which would cover its costs of production, (including future costs resulting from obligations under Multilateral Environmental Agreements and ILO Conventions), and a reasonable profit. The investigation established a basic target profit of 6%. The injury margin was determined by comparing the weighted average import price of the cooperating exporting producers with the weighted average target price of the Union industry during the IP, which resulted in underselling margins ranging from 19,3% to 46,7%. Given these levels were lower than the dumping margins and the fact that there were no significant raw material distortions found, the lesser duty rule in line would be applied.

Union interest and definitive measures

The Commission analysed whether it was in the Union interest to adopt anti-dumping measures. The Commission analysed the various interests involved, including those of the Union industry, unrelated importers and users. Regarding the Union industry, which employs over 8 000 workers directly, the investigation established that the imposition of anti-dumping duties would allow it to recover lost market share and improve profitability towards sustainable levels. It was also concluded that the primary aluminium sector, which employ around 2 800 workers, relies on the health of its downstream customers. Without measures the viability of these upstream suppliers, would be put at risk if the Union industry contracts further.

Some importers argued that insufficient production capacity of the Union industry combined with the strong post-COVID recovery had led to material shortage, delayed deliveries and price increases since the end of the IP. They stated that anti-dumping measures would worsen the supply situation for users while the Union industry would benefit from duties, shortages, delay and an increase in prices and profit to the detriment of the entire industrial EU system. While the Commission acknowledged the existence of material shortage and price increases, it did not conclude that there was a structural lack of capacity in the EU. The Commission concluded that importers would be able to pass on the duty to their customers given their profit margins as well as having the possibility to find alternative sources of supply. Therefore, the Commission concluded that importers would not be affected disproportionally by the imposition of the measures due also, in part, to their other activities.

As regards user industries, including aluminium heat exchangers, building industry and foil stock users the Commission considered that the measures would have only have a limited impact on their financial situation. Overall, the Commission concluded that the effects of an imposition of duties would not outweigh the positive effects of measures on the Union industry.

The Commission therefore decided that definitive anti-dumping measures should be imposed on imports of aluminium flat products originating in China. The definitive anti-dumping measures were imposed in October 2021 (based on the underselling margin applying the lesser duty rule), and ranged from 14,3% to 24,6%.

Suspension of measures

Following final disclosure in the anti-dumping investigation, a number of companies (Airoldi Metalli S.p.a. (‘Airoldi’), Valeo Systèmes Thermiques SAS (‘Valeo’) and related companies, and TitanX Engine Cooling AB (‘TitanX’)) provided information on a change of market conditions which occurred after the IP arguing that the changes would justify the suspension of the measures, in accordance with Article 14(4) of the basic Regulation. In July 2021, the Commission requested interested parties in the Union to provide comments on the possibility to suspend definitive measures in due course.

Article 14(4) of the basic Regulation provides that, in the Union interest, anti-dumping measures may be suspended where market conditions have temporarily changed to an extent that injury would be unlikely to resume as a result of such suspension.

The analysis of the additional information requested by the Commission showed that, following the IP, the situation of the Union industry improved significantly. In the first quarter of 2021, Union producers’ sales increased by over 55% in comparison with the IP and by 34% in comparison with 2017, which was the best year in the period considered. Also, production volume and production capacity developed positively increasing respectively by 11% and 25% in comparison with 2017. Average sales prices to unrelated customers in the Union also increased by 2,4 % in the first semester of 2021 when compared to 2017 and by 6,5% when compared with the IP. Profitability reached 1,9% in the first semester of 2021 whereas the Union industry was loss making in the IP (– 1,8%). All indicators for which the Commission requested post-IP information showed a significant improvement when comparing the first semester of 2021 with the IP or with data from 2017 with the exception of capacity utilization and profitability. Several parties provided evidence that Union producers could not supply the requested products because they had reached capacity for orders in 2021 and for at least the first half of 2022. The Commission concluded that market conditions changed after the period considered in the definitive Regulation but the changed market conditions were temporary in nature and it was likely that supply and demand would align again after the temporary suspension of the measures.

Given the level of demand and the fact that many users switched to the Union industry post IP and the nature of the contracts (very few spot orders), the Commission considered it unlikely that the Union industry would lose significant business to Chinese exporters if measures were to be suspended for 9 months. In addition, the Commission considered that the 9-month suspension would give users, that requested the exclusion of certain products, an additional period to turn to Union producers and ensure a smooth transition from a Chinese to a Union source of supply, if necessary. Given the temporary nature of the change in market conditions concerning demand and supply, together with the Union industry’s prospects for the period, it was considered that the injury linked to the imports of the product concerned originating in China was unlikely to resume if measures were suspended.

Consequently, the Commission decided to suspend the measures for nine months on the same day the measures were imposed. The Commission established an operational monitoring system, in which interested parties may draw its attention to relevant developments in the market on a regular basis.

Birch plywood originating in Russia (Definitive AD)

On 14 October 2020, the European Commission initiated an anti-dumping investigation on imports of birch plywood originating in Russia following a complaint received from the Woodstock Consortium containing sufficient evidence of dumping and of resulting material injury. Birch plywood is a wood sheet material consisting of layers or strands of wood veneers pressed together with glue into large, flat sheets. It is used in a wide range of applications, for example in the construction, packaging and furniture sectors. The investigation period for dumping and injury was 1 July 2019 to 30 June 2020 and the examination of injury trends covered the period from 1 January 2017 to the end of the investigation period (“the period considered”).

On 11 June 2021, the Commission imposed provisional anti-dumping duties ranging between 15% and 15,9% on imports of birch plywood originating in Russia by Commission Implementing Regulation (EU) 2021/940.

Sampling

Sampling was applied in the investigation. Three Union producers, located in different Member States accounting for almost 40% of the estimated total production and 35% of estimated total Union sales volume of the like product in the Union were selected for the sample. A sample of three out of thirteen importers was selected. As regards exporting companies a sample of three groups of companies was selected accounting for approximately 47% of the total exports to the Union during the investigation period.

Dumping

The normal value was based on the price paid or payable in the domestic market where domestic sales were found to be representative and constructed where domestic sales were not representative.

The three sampled companies exported to the Union directly to independent customers or through a related importer in the Union. For the direct exports, the export price was the price actually paid or payable for the product concerned when sold for export to the Union. For the exports through a related importer, the export price was based on the price at which the product was first resold to independent customers in the Union, adjusted backwards to an ex-works price by deducting all costs incurred between importation and resale, including SG&A expenses, and for profits accruing. A comparison between normal values and export prices, duly adjusted where necessary, resulted in a dumping margin of 14,4% for Sveza group, 15,8% for Zheshartsky LРK LLC and 15,72%, for Syktyvkar Plywood Mill Ltd.

Injury and causation

During the period considered, Union consumption of birch plywood remained stable at around 1.75m cubic meters. Imports from Russia increased by 14% from around 710 163 cubic meters to around 812 521 cubic meters representing an increase in market share from 40% to 46% over the period considered. The average prices of the imports from Russia decreased by 10 % from 646 EUR/tonne in 2017 to 584 EUR/tonne during the investigation period. The weighted average undercutting found on the basis of the data provided by the sampled exporting producers was 12,6 %.

The Commission found that the economic situation of the Union industry worsened with all major macro indicators presenting a negative trend including production - 14%, EU sales - 17% with a significant reduction of its market share from 47% to 39% in the period considered. Because of the pressure from the low Russian prices, the Union industry tried to reduce costs including a reduction of 12% in employment. However, as a result of the pressure exerted by dumped Russian imports in terms of increased volumes and low prices, EU sales dropped and stocks increased rapidly (+ 22%) in the period considered. The cost of production of the Union industry went up over 10% during the period considered, mainly because of a strong increase in the raw material prices. Owing to the pressure from the dumped imports, the Union producers were unable to increase prices to cover these increased costs. As a result, profitability dropped from 9.7% in 2017 to an unsustainable loss of -2,8% in the IP. Therefore, the Commission concluded that the Union industry suffered material injury.

Regarding causation, the Commission found that there was a clear correlation between the rise of dumped imports from Russia and the deteriorating situation of the Union industry. As a result of the significant increase of dumped imports from Russia the Union industry was precluded from increasing prices, resulting in a strong decline in its economic situation. Some of the other factors examined included the impact of Covid-19, strikes of some producers in Finland as well as imports from other sources. However, the investigation found that no other factor attenuated the causal link between the Russian imports and the Union industry's injurious situation.

Injury margin and level of measures

The duty necessary to eliminate the injury suffered by the Union industry was set at a level that would allow the EU industry to sell at a target price which would cover its costs of production, (including future costs resulting from obligations under Multilateral Environmental Agreements and ILO Conventions), and a reasonable profit. The investigation established a basic target profit of 9,7%, based on the profitability of the Union industry in year 2017, that is, before the surge of Russian imports. The injury margin was determined by comparing the weighted average import price of the cooperating exporting producers with the weighted average target price of the Union industry during the IP, which resulted in margins ranging from 35,2% to 58,3%.

Union interest and definitive measures

The Commission analysed whether it was in the Union interest to adopt anti-dumping measures. The Commission analysed the various interests involved, including those of the Union industry, importers and users.

Regarding the Union industry, the investigation established that the imposition of anti-dumping duties would restore a level playing field and a fair price level on the Union market, and improve the Union industry’s profitability. The Commission found that while anti-dumping measures might negatively affect some importers, the impact would not be significant overall and would depend on the importers’ business model, the variety of their sources of supplies and the extent to which increased costs are passed on to their customers. Regarding the main sectors using birch plywood in the EU (construction, transport, furniture and packaging), the impact of the measures was assessed to be limited. Several parties claimed that the imposition of duties might cause carbon leakage due to a substitution of Russian birch plywood with Chinese poplar plywood or plywood from other countries farther away from Europe, raising transport emission and the risk that substitute products are less sustainable than Russian birch plywood. However, the Commission rejected this claim on the basis that measures would not exclude Russian imports and there was no evidence to support that these products were less sustainable than the Russian products. The Commission concluded that the effects of an imposition of duties would not outweigh the positive effects of measures on the Union industry.

The Commission concluded that definitive anti-dumping measures should be imposed on imports of birch plywood originating in Russia. The definitive anti-dumping measures imposed on 9 November 2021 (based on the dumping margin applying the lesser duty rule), range from 14,4% to 15,8%.

Mono ethylene glycol originating in the USA and the Kingdom of Saudi Arabia (Definitive AD)

On 14 October 2020, the European Commission initiated an anti-dumping investigation on imports of mono ethylene glycol (‘MEG’) originating in the USA and the Kingdom of Saudi Arabia (KSA) on the basis of a complaint lodged by the Defence Committee of European MEG Producers representing more than 25% of the total Union production of MEG. The complaint contained evidence of dumping and of resulting material injury.

The product concerned is mono ethylene glycol produced starting from various feedstocks (ethane, propane, NGL, butane) to make ethylene which is then mixed with oxygen to form ethylene oxide and then with water to produce mono ethylene glycol. It is available in two different grades: fibre grade and technical grade. Fibre grade MEG is used predominantly in the production of PET, polyester fibres, resins and films while technical grade MEG is mainly used in the automotive sector as anti-freeze. Other applications include heat transfer agent, de-icing fluids, surface coatings, unsaturated polyester resins, polyester polyols, and natural gas dehydrogenation.

The investigation period covered 1 July 2019 to 30 June 2020 while the examination of trends relevant for the assessment of injury covered the period from 1 January 2017 to the end of the investigation period.

On 11 June 2021, the Commission imposed provisional anti-dumping duties of 11.1% on imports of MEG originating in Saudi Arabia and duties ranging from 8,5% to 52% on the product originating in USA.

Sampling

Sampling was applied in the investigation for Union producers and US exporters. The sample consisted of three Union producers, out of which two were related accounting for 64,1 % of total Union production and 65% of total Union sales. Two groups of exporting producers in the US were selected for the sample representing approximately 55% of imports from the US to the EU during the IP. Sampling was not applied for exporting producers in the KSA.

Dumping

Saudi Arabia

Only one of the six production entities of the sole company group, SABIC produced MEG for the domestic market. Both domestic sales and exports to the Union were examined at the company group level. In this case, the normal value was based on the price paid or payable in the domestic market where domestic sales were found to be representative. Given that less than 80 % of all domestic sales were profitable and that the weighted average sales price was lower than the cost of production, the normal value was calculated as a weighted average of the profitable sales only.

The MEG exported to the EU was manufactured by six exporting producers, two of which are joint ventures with ExxonMobil and SPDC (a company related to Mitsubishi Corporation). The MEG is then exported through three different networks of related traders and importers in the Union: one for SABIC, one for ExxonMobil and one for SPDC. Therefore, the export price was established on the basis of the price at which the imported product was first resold to independent customers in the Union. Adjustments to the export price were made for all costs incurred between importation and resale, including SG&A expenses, and for profits. A comparison between normal values and export prices, duly adjusted where necessary, resulted in definitive dumping margin, expressed as a percentage of the CIF Union frontier price, duty unpaid, of 7,7%.

USA

For the US, the normal value was based on the price paid or payable in the domestic market where domestic sales were found to be representative. Given that for MEGlobal Americas Inc, less than 80% of all domestic sales were profitable and the weighted average sales price was higher than the cost of production, the normal value was calculated as a weighted average of the profitable sales only.

For the exporting producer that exported the product concerned directly to independent customers in the Union, the export price was the price actually paid or payable for the product concerned when sold for export to the Union, in accordance with the basic Regulation. For the exporting producer that exported the product through a related company acting as an importer in Switzerland, the export price was established on the basis of the price at which the imported product was first resold to independent customers in the Union, in accordance with the basic Regulation. Adjustments to the price were made for all costs incurred between importation and resale, including SG&A expenses, and profits. As to the latter, the same profit margin of 6,89% as for the KSA was applied. A comparison between normal values and export prices, duly adjusted where necessary, resulted in definitive dumping margins, expressed as a percentage of the CIF Union frontier price, duty unpaid, of 3% for one company and 46,7% for the second.

Injury and causation

The volume of imports from the countries concerned grew by 38 % over the period considered and as there was fairly stable Union consumption, increased their market share from 31,6 % in 2017 to 44,1 % in the IP. As a result, the Union industry lost 10.7 percentage points of their market share. It was through significant price pressure that the exports were able to increase market share with prices on average between 12% and 15% lower than Union industry costs. The Union industry had no choice but to decrease prices as well. Even though the cost of production decreased as well due to a drop in the price of ethylene, the price pressure from the imports was such that it forced the Union industry to decrease prices below the cost of production, resulting in significant losses by the end of the IP. Hence, all main macroeconomic injury indicators showed a negative trend during the period considered. Production volume, sales volume, employment and productivity decreased by 19%, 18%, 7% and 13% respectively. EU producers’ average unit sales prices to unrelated parties decreased by 40% over the period considered while their costs only decreased by 13%. This led to a significant deterioration in profitability, going from profits between 16,7% and 20,5 % in 2017 to losses between 10,8 % and 13,2 % during the IP. The Commission concluded that the Union industry suffered material injury.

Regarding causation, there was a clear coincidence in time between the substantial increase of imports at dumped prices and market share of the countries concerned and the significant decrease in sales and market share of the Union producers, coupled with the price depression, and the deteriorated financial situation of the Union industry. The Commission examined the effect of other factors on the Union industry’s injury including the Covid pandemic, Union producers export sales performance and higher production costs and lack of competitiveness. The investigation did not find that any other factors attenuated the causal link between the dumped imports and the injury suffered.

Injury margin and level of measures

The duty necessary to eliminate the injury suffered by the Union industry was set at a level that would allow the EU industry to sell at a target price which would cover its costs of production, (including future costs resulting from obligations under Multilateral Environmental Agreements and ILO Conventions), and a reasonable profit. The investigation established a basic target profit of between 17,5% and 19,5%, taking into account the level of profitability before the increase in imports from the countries concerned, the level of profitability needed to cover full costs and investments, research and development (R&D) and innovation, and the level of profitability to be expected under normal conditions of competition. The injury margins were determined by comparing the weighted average import prices of the cooperating exporting producers with the weighted average target price of the Union industry during the IP which resulted in underselling margins ranging from 39,6% to 109,4% for USA and 61,5% for KSA.

Union interest and definitive measures

The Commission analysed whether it was in the Union interest to adopt anti-dumping measures. The Commission analysed the various interests involved, including those of the Union industry, importers and users.

Regarding the Union industry, the non-imposition of measures would lead to a discontinuation of thereby reducing the available sources of supply on the Union market and making the EU dependent on imports primarily from the KSA and the US. The Commission found this to be undesirable for users not only in terms of competition, but also of security of supply of importers/traders and users. The Commission concluded that the impact of measures would not be disproportionate for importers/traders as they would be able to pass on part of the duties to users and, in any event, other sources of supply were available (Taiwan, Singapore and Korea) to them. The Commission examined the impact of measures on users particularly in the coolant, PET and industrial products segment (fibres, films, resins) industries. While the investigation showed a mixed impact on the various segments, it was not considered disproportionate to the benefits of imposing measures. The Commission concluded that definitive anti-dumping measures should be imposed on imports of MEG originating in USA and KSA. The definitive anti-dumping measures imposed in November 2021 (based on the dumping margin applying the lesser duty rule), ranged from 3% to 60,1% for imports from the US and 7,7% from KSA.

Steel wind towers originating in China (Definitive AD)

On 21 October 2020, the European Commission initiated an anti-dumping investigation with regard to imports of certain steel wind towers originating in the People’s Republic of China following a complaint lodged by the European Wind Tower Association containing sufficient evidence of dumping and of resulting material injury. 

The product under investigation is certain utility scale wind towers of steel (‘SWT’), whether or not tapered, and sections thereof whether assembled or not, whether or not including an embedded tower foundation section, whether or not joined with nacelles or rotor blades, and that are designed to support the nacelle and rotor blades. It is used in wind turbines that have electrical power generation capacities – either in onshore or offshore applications – equal to or in excess of 1,00 megawatt (‘MW’) and with a minimum height of 50 meters measured from the base of the tower to the bottom of the nacelle (i.e. where the top of the tower and nacelle are joined) when fully assembled.

The investigation period for dumping and injury was 1 July 2019 to 30 June 2020 and the examination of injury trends covered the period from 1 January 2017 to the end of the investigation period (‘the period considered’).

Sampling

Sampling was applied in the investigation.  On the Union industry side, the sample of consisted of three Union producers, located in two different Member States, which accounted for around 38% of the estimated Union sales and production volume of the like product at initiation stage.

As regards Chinese exporting producers, the Commission selected a sample of three exporting producers on the basis of the largest representative volume of exports to the Union which could reasonably be investigated within the time available.

Dumping

Given the finding of significant distortions as regards the product under investigation in China, the normal value was constructed on the basis of cost of costs of production and sale in an appropriate representative country (Mexico), in line with Article 2(6a) of the basic Regulation.

The three sampled exporting producers exported to the Union directly to independent customers. Therefore, the export price was the price actually paid or payable for the product concerned when sold for export to the Union. 

A comparison between normal values and export prices, duly adjusted where necessary, resulted in a dumping margins of sampled exporting producers equalling 126,8 % for Chengxi Shipyard, 49,7 % for Penglai Dajin,  and 60,7 % Suzhou Titan, respectively.

Injury and causation

The Commission concluded that the Union industry suffered material injury. The fact that a few indicators (production capacity, stocks) did not deteriorate does not undermine the finding of injury.

During the period considered, injury indicators developed as follows: overall, Union consumption increased from 2 707 towers in 2017 to 3 087 in the investigation period while imports from China overall increased by 54%. Their market share grew from 25% in 2017 to 34% in the investigation period, which entails a 35% increase over the period considered. The average prices of imports from China fluctuated. Overall, they increased by 2%, although they dropped significantly between 2018 and 2019 and then recovered. The dumped imports of the sampled exporting producers showed weighted average undercutting margins between 2,7% and 5,1% which was considered significant, given that the product under investigation is very price-sensitive.  Union production dropped by 10% whereas production capacity increased by a mere 2% and capacity utilisation fell from 56% in 2017 to 49 % in the investigation period. The Union industry’s sales volume dropped by 7% over the period considered. The Union industry’s market share fell from 69% in 2017 to 56% in the investigation period, which entails a decrease by 18% overall. The level of Union industry employment related to the production of SWT dropped by 5% over the period considered. Productivity fell from 0,71 towers in 2017 to 0,68 towers per employee in the investigation period. The average unit sales prices of full scope orders for Union-origin SWT increased by 12%, while the unit cost of production increased to a larger extent, i.e. by 21%. During the period considered, the average labour costs per employee increased by 7% following the general inflation and labour cost trends. The profitability of the Union industry shrank from +3,6% in 2017 to –1,4 % in the investigation period. The net cash flow was negatively affected by falling profits and was negative between 2018 and the investigation period. The ability to raise capital was hindered by the drop in profits. The level of yearly investments followed a steady downwards trend and dropped by 90% in the period considered.

Regarding causation, the Commission concluded that the imports from China caused material injury to the Union industry. Such injury had both volume and price effects. In terms of prices, Chinese import prices were significantly below the Union industry sales prices and below the Union industry cost of production throughout the period considered, leading to price suppression. The price pressure exerted by the high and increasing import volumes from China at such prices over the period considered is a clear explanation for the Union industry’s inability to reflect the cost increases in its sales prices and the resulting losses. In terms of volumes, over the period considered, the Union industry lost sales to Chinese imports. The import volumes from China increased strongly (by 54%) and their market share increased by nine percentage points, from 25% in 2017 to 34% in the investigation period. In the same period, and despite the 14% increase in consumption, the Union industry’s sales volume dropped by 7% over and its market share fell from 69% in 2017 to 56% in the investigation period.

The Commission analysed the impact of other factors, such as imports from third countries, the export performance of the Union industry, raw material prices, offshore demand, competition of wind power with other energy sources, non-steel towers and production facilities issues. The Commission concluded that these other factors, considered individually or collectively, did not attenuate the causal link between the dumped imports and the material injury.

Injury margin and level of measures

The duty necessary to eliminate the injury suffered by the Union industry should be at a level that would allow the EU industry to sell at a target price which would cover its costs of production, (including future costs resulting from obligations under Multilateral Environmental Agreements and ILO Conventions), and a reasonable profit. The investigation established a basic target profit of 9,1%, which is the average profit achieved by the Union industry in two years prior to the period considered (2015 and 2016), before the increase of Chinese imports. The injury margin was determined by comparing the weighted average import price of the cooperating exporting producers with the weighted average target price of the Union industry during the investigation period, which resulted in margins ranging from 7,2% to 14,4%.

Union interest and definitive measures

The Commission analysed whether it was in the Union interest to adopt anti-dumping measures. The Commission analysed the various interests involved, including those of the Union industry, importers, users, suppliers and environmental issues. Regarding the interest of the Union industry, the investigation established that the imposition of anti-dumping measures would strengthen the renewable value chain in the Union and a sustainable business model based on security of supply and fair competition. In relation to interest of importers, the Commission first noted that unrelated importers did not cooperate in the investigation. The Commission further found that users import the product under investigation directly. In light of the above, the Commission concluded that there is no evidence that the imposition of anti-dumping duties would affect importers. In relation to users, the Commission found that product under investigation is sold directly by SWT producers to wind turbine producers, which are users in this proceeding to the extent they assemble the SWT with a full wind turbine. The Commission concluded that measures on imports of Chinese SWT are not expected to have a major impact on the profits of co-operating users, their R&D activities or the manufacturing operations of certain parts of wind turbines by users.

At the same time, the Commission considered that measures would support jobs in the wind sector in the Union overall as jobs in this area are forecasted to grow. Regarding alleged supply problems claimed by some users, the Commission found that the Union industry has the production capacity for all required sizes of SWT. Production capacity of Union SWT producers is higher than Union consumption and significant SWT capacities are available in the Union serving all required locations and both onshore and offshore markets. The Commission therefore concluded that the measures on imports of Chinese SWT are not expected to have a major impact on users while they would benefit upstream industries in the Union, namely suppliers of raw materials (e.g. Union steel mills) and relevant machinery producers in the Union. Similarly, the investigation concluded that measures are expected to support SWT producers in the Union and bring them growth, job stability, revenues and investments. Finally, users should benefit from a broad base of competitive, reliable and financially sound SWT producers in the Union and from convenient lead-times that Union producers are able to offer thanks to their proximity. Consequently, the Commission concluded that that there were no compelling reasons that it was not in the Union interest to impose definitive anti-dumping measures on imports of steel wind towers and their sections originating in China.

The Commission imposed the definitive anti-dumping measures on 16 December 2021 (based on the injury margin applying the lesser duty rule), ranging from 7,2 % to 19,2%.

Optical fibre cables originating in the People’s Republic of China (Definitive AD)

On 24 September 2020, the European Commission initiated an anti-dumping investigation with regard to imports of optical fibre cables originating in the People’s Republic of China following a complaint lodged by Europacable containing sufficient evidence of dumping and of resulting material injury.

The product under investigation is single mode optical fibre cables, made up of one or more individually sheathed fibres, with protective casing, whether or not containing electric conductors. Optical fibre cables (OFC) are used as an optical transmission medium in telecommunication networks in long haul, metro and access networks.

The investigation period for dumping and injury was 1 July 2019 to 30 June 2020 and the examination of injury trends covered the period from 1 January 2017 to the end of the investigation period.

Sampling

Sampling was applied in the investigation. Three Union producers were selected for the sample on the basis of the highest volume of production and sales of the like product in the Union. They accounted for 52% of the estimated total production of the like product in the Union during the investigation period. As regards Chinese exporting companies, a sample of two groups of companies was selected accounting for more than 40% of the total exports to the Union during the investigation period.

Dumping

The two sampled groups of companies, the FTT group and the ZTT group, all exported to the EU in the IP. Given the finding of significant distortions as regards the product under investigation in China, the normal value was constructed on the basis of cost of costs of production and sale in an appropriate representative country (Argentina), in line with Article 2(6a) of the basic Regulation.

The two groups exported to the Union either directly to independent customers or through related companies acting as either an agent, trader or an importer. For the direct exports, the export price was the price actually paid or payable for the product concerned when sold for export to the Union. For the exports through a related importer, the export price was based on the price at which the product was first resold to independent customers in the Union, adjusted backwards to an ex-works price by deducting all costs incurred between importation and resale, including SG&A expenses, and for profits accruing. A comparison between normal values and export prices, duly adjusted where necessary, resulted in a dumping margins of 44% and 19.7% for the FTT group and the ZTT group, respectively.

Injury and causation

During the period considered, several indicators showed a positive trend such as production, capacity, sales volume on the Union market and employment. However, the development of these indicators did not match the increase in consumption. In fact, the Commission concluded that in normal competition conditions, those indicators should have had an even stronger positive trend, considering the Union industry would have been able to benefit fully from the growing market. Despite the increase in sales volume, the Union industry lost 10,8 percentage points of market share (from 64,3% to 53,5%), which was found to be linked to the price pressure generated by Chinese exports, with significant undercutting and, in any event, price depression throughout the period considered. The foregoing led to financial injury in the form of lower profits and a drop in investments and on the return thereon. In addition to that, the analysis of sales through tenders indicated that the market share and price erosion was accelerating and would continue to do because of the extremely aggressive behaviour from Chinese exporting producers therein. Therefore, the Commission concluded that the Union industry suffered material injury.

Regarding causation, the Commission found that there was a clear correlation between the rise of dumped imports from China and the material injury observed for the Union industry. The dumped imports have increased in both absolute and relative terms. Consumption in the Union market increased 38% over the period considered, and it was evident that it had been mainly imports from China that took advantage of this growth. The deterioration in the Union industry market share throughout the period considered was simultaneous and directly connected with significant penetration of the Union market by substantial volumes of imports from China, which significantly undercut the Union industry’s prices and, in any event, exercised significant price depression on Union sales. In particular, the adverse impact on profitability caused by the dumped imports and continuous price pressure did not allow the Union industry to undertake the necessary investments for the longterm survival of the industry. The Commission analysed the impact of other factors (imports from third countries, the export performance of the Union industry, captive sales, and raw material prices) in the situation of the Union industry, but found that none of the other factors explained the Union industry’s negative developments in terms of loss of market share, price depression and low profitability, decreasing investments and return on investments. Thus, the Commission concluded that the injury to the Union industry was caused by the dumped imports from China.

Injury margin and level of measures

The duty necessary to eliminate the injury suffered by the Union industry should be at a level that would allow the EU industry to sell at a target price which would cover its costs of production, (including future costs resulting from obligations under Multilateral Environmental Agreements and ILO Conventions), and a reasonable profit. The investigation established a basic target profit of 12,4%, based on the profitability of the Union industry in year 2016, that is, before the sharp increase of Chinese imports in 2017. The injury margin was determined by comparing the weighted average import price of the cooperating exporting producers with the weighted average target price of the Union industry during the investigation period which resulted in margins ranging from 42% to 61,3%.

Union interest and definitive measures

The Commission analysed whether it was in the Union interest to adopt anti-dumping measures. The Commission analysed the various interests involved, including those of the Union industry, importers and users. Regarding the Union industry, the investigation established that the imposition of anti-dumping measures would allow the Union industry to maintain a competitive position on the market and recover lost market share, while improving their profitability towards sustainable levels. In relation to importers, the Commission found that while the anti-dumping measures were likely to have a certain negative impact thereon and might reduce their profitability, importers would be able to absorb and/or pass on some of the cost increase considering their significant profit margins (over 20 %). They also had the possibility of finding alternative sources of supply, including from other third countries and the Union industry. Therefore, it concluded that unrelated importers were not disproportionally affected by the imposition of the measures. Finally, for users, the investigation established that OFC represents only a minor share of the total rollout cost of digital networks projects - in the case of 5G being much less than 5%. The purchases of the product under investigation by the cooperating telecom operators represented a marginal percentage of company turnover, and the firm purchase a significant part of its OFC from other sources. Therefore, the Commission concluded that users and distributors would also not be disproportionally affected by the imposition of the measures.

Overall, the investigation found that there was sufficient capacity in the Union and in other third countries to replace imports originating in China. Furthermore, the imposition of anti-dumping measures would enable the Union industry to invest in their Union production sites and new technologies to the benefit the user industry. At the same time, measures would not prevent imports from third countries (including China) from competing fairly in the Union market. Even if the demand for OFC increased in the following years as expected by market players, OFC importers and users would not run any noticeable risks of shortage of supply and the rollout of the optical fibre broadband network to homes and businesses would thus not be delayed.

Thus, the Commission concluded that definitive anti-dumping measures should be imposed on imports of Optical fibre cables originating in the People’s Republic of China. The definitive anti-dumping measures imposed on 18 November 2021 (based on the dumping margin applying the lesser duty rule), range from 19,7% to 44%.

Aluminium converter foil originating in the People’s Republic of China (Definitive CVD)

On 4 December 2020, the European Commission initiated an anti-subsidy investigation on imports of aluminium converter foil originating in the People’s Republic of China following a complaint lodged by six Union producers containing sufficient evidence of subsidisation and of material injury.

The product under investigation is aluminium converter foil (‘ACF’) of a thickness of less than 0,021 mm, not backed, not further worked than rolled, in rolls of a weight exceeding 10 kg.

The investigation of subsidisation and injury covered the period from 1 July 2019 to 30 June 2020 and the examination of injury trends covered the period from 1 January 2017 to the end of the investigation period.

Sampling

Sampling was applied in the investigation. Three Union producers, located in different Member States accounting for more than 50% of the estimated total production and 40% of estimated total Union sales volume of the like product in the Union were selected for the sample. As regards exporting companies, a sample of three groups of companies was selected accounting for over 90% of the estimated total Union imports of the product under investigation. Only two unrelated importers provided the information necessary and agreed to be included in the sample. Given the small number of replies, sampling of unrelated importers was not necessary.

Subsidy

The product under investigation is regarded by Government of China (GOC) as a key product and as such it is covered by a variety of specific policies and support measures designed to increase its production. The ACF industry is thus regarded as a strategic industry whose development is actively pursued by the GOC as a policy objective. The companies sampled in the investigation were found to benefit from several subsidy schemes, in particular:

-Preferential financing - loans: all sampled groups of exporting producers benefited from preferential financing through loans from state-owned financial institutions such as Bank of Yantai, Huishang Bank, Nanyang Commercial Bank during the investigation period. In view of the existence of a financial contribution, a benefit to the exporting producers and specificity, the Commission considered preferential financing through loans a countervailable subsidy.

-Preferential financing - other types of financing: Chinese financial institutions (up to 48 banks, 47 of which were State-owned) provided credit lines to each sampled group in connection with the provision of financing. These consisted of framework agreements, under which the bank allows the sampled companies to use various debt instruments, such as working capital loans, bank acceptance drafts and other forms of trade financing within a certain maximum amount. Under normal market circumstances, credit lines would be subject to a so-called ‘arrangement’ or ‘commitment’ fee to compensate for the bank’s costs and risks at the opening of a credit line, as well as to a ‘renewal fee’ charged on a yearly basis for renewing the validity of the credit lines. However, each sampled group of companies benefited from credit lines provided free of charge. The exporting producers also benefitted from preferential financing in the form of convertible and non-convertible corporate bonds and export credit insurance.

-Grant programmes: Central and local governments in China provided grants under The Industry Revitalization and Technology Renovation Work Plan which set up special funds for promoting technological progress and technological transformation projects. The sampled groups of companies benefitted from a variety of grants programmes such as grants related to technology, innovation and development, asset-related grants, interest discounts on loans and grants supporting exports. Grants related to technology, innovation and development constituted a significant part of the grants reported by the sampled groups of companies.

-Government provision of goods for less than adequate remuneration – land, electricity: the exporting companies benefitted from the provision of land use rights through allocation by local authorities and not through a bidding procedure - to calculate the benefit, land prices from Chinese Taipei were used as an external benchmark; certain companies purchased electricity directly from power generators by signing direct purchasing agreements with the approval of local authorities to participate in the direct electricity pilot scheme. The prices were lower than the official prices set at provincial level for large industrial users. The benchmark used was the standard electricity price.

-Revenue foregone: companies within the sampled exporting producer groups qualified as high-tech companies during the investigation period and thus enjoyed a reduced enterprise income tax rate of 15%.

Injury and causation

All macroeconomic indicators, such as production, capacity, capacity utilization, sales volume in the EU market, market share, employment and productivity, showed a negative trend over the period considered. The weighted average undercutting found on the basis of the data provided by the sampled exporting producers was 10.8 %. Similarly, virtually all microeconomic indicators, such as sales prices in the EU free market, cost of production, labour costs, profitability, closing stocks, cash flow, investment and return on investments, showed a negative trend over the period considered. The same injury indicators also developed negatively when looking at the period 2017-2019, that is, before the start of the COVID-19 pandemic. For many indicators the situation in the IP was better than in 2019. This was mainly due to the lower level of imports from the PRC caused by the pandemic outbreak at the end of 2019 and beginning of 2020. This further emphasises the impact these imports have on the overall situation of the Union industry. On this basis, the Commission concluded that the Union industry suffered material injury.

Regarding causation, the Commission found a clear nexus between the deterioration of the situation of the Union industry and the increase of imports from the PRC. The Commission distinguished and separated the effects of all known factors on the situation of the Union industry (consumption, COVID-19 pandemic, lack of investment, restructuring, vertical integration, energy costs, salary levels, imports from third countries and export performance of the Union industry) from the injurious effects of the subsidised imports. None of the factors contributed, alone or in combination, to the negative developments of the injury indicators observed in the period considered.

On this basis, the Commission concluded at this stage that the subsidised imports from the country concerned caused material injury to the Union industry and that the other factors, considered individually or collectively, did not attenuate the causal link between the subsidised imports and the material injury.

Union interest and definitive measures

The Commission analysed whether it was in the Union interest to adopt anti-dumping measures. The Commission analysed the various interests involved, including those of the Union industry, importers and users.

Regarding the Union industry, the Commission concluded that the absence of measures would have a significant negative effect on the Union industry in terms of further price suppression, lower sales and further deterioration of the profitability. The measures would allow the Union industry to reach its potential on the Union market, recover lost market share, and improve profitability to levels to be expected under normal conditions of competition.

Regarding users and importers, the investigation did not establish a significant level of dependency on the imports of aluminium converter foil from China. Some parties argued that the EU industry would not be able to supply the users with a product of the same quality of the Chinese imports and that the measures would jeopardise the competitiveness of the users on the Union market as costs increases could not be passed on to the customers. The investigation revealed that the Union producers have made investments to increase quality and that they already competed successfully in third markets with products of Chinese quality. Moreover, the users did not substantiate their other claims including those concerning their inability to pass on costs to customers. The Commission concluded that the effects of the imposition of duties would not outweigh the positive effects of measures on the Union industry.

3.1.5.    New investigations terminated without measures

In accordance with the provisions of the respective basic Regulations, investigations may be terminated without the imposition of measures if a complaint is withdrawn or if measures are unnecessary (i.e. no dumping/no subsidies, no injury resulting from dumped or subsidised imports, measures not in the interest of the Union). In 2021, 1 new anti-dumping investigation was terminated without measures, compared to 5 in 2020 – see table below.

More information can be obtained from the Official Journal publications to which reference is given in Annex E.

3.2.Review investigations

3.2.1.    Expiry reviews

Article 11(2) and Article 18 respectively of the basic Regulations provide for the expiry of measures after 5 years, unless an expiry review demonstrates that in a review that the expiry would be likely to lead to a continuation or recurrence of dumping or subsidisation and related injury. In 2021, 1 anti-dumping measure expired automatically. The reference for the measure is available in Annex N.

Since the expiry provision of the basic Regulations came into force in 1985, a total of 516 measures have expired automatically.

3.2.1.1.    Initiations

In 2021, the Commission initiated 9 expiry reviews of anti-dumping measures and 1 expiry review of anti-subsidy measures. The list of the expiry reviews initiated in 2021 are in the following table, together with the name of the complainant. Some expiry reviews may be carried out in parallel with interim reviews. Where there are interim reviews and expiry reviews ongoing at the same time, these are indicated by an asterisk in the table below. More information can be obtained from the Official Journal to which reference is available in Annex F.

3.2.1.2.    Expiry reviews concluded with confirmation of duties

In 2021, the Commission concluded 15 expiry reviews with a confirmation of the duties for a further period of 5 years.

The list of the measures, which were renewed during 2021, together with the results of the investigations, can be found below. More information can be obtained from the Official Journal publications to which reference is given in Annex F.

3.2.1.3 Details of some individual cases concluded by confirmation of duty

Certain welded pipes and tubes (WPT) of iron or non-alloyed steel originating in Belarus, the People’s Republic of China and Russia

On 24 January 2020, the Commission initiated an expiry review of the anti-dumping measures imposed on imports of certain welded pipes and tubes of iron or non-alloyed steel originating in Belarus, the People’s Republic of China and Russia, following a request lodged by the Defence Committee of the welded steel tubes industry of the European Union acting on behalf of producers representing more than 25 % of the total Union production of the product concerned. The product under review is welded tubes and pipes (WPT), of iron or non-alloy steel, of circular cross-section and of an external diameter not exceeding 168,3 mm. It is mainly used for the transportation of gases and liquids in plumbing, heating, ventilation systems, etc.

The review investigation period (RIP) ran from 1 January 2019 to 31 December 2019. The examination of trends relevant for the assessment of the likelihood of a continuation or recurrence of injury covered the period from 1 January 2017 to the end of the RIP (‘the period considered’).

Sampling

Sampling applied to Union producers. The sample consisted of three Union producers accounting for 40% of the estimated total Union production and 38% of the estimated total Union sales volume of the product under review. Sampling of exporting producers was not necessary as only a small number of Russian and Belarus companies came forward while no Chinese companies cooperated.

Likelihood of continuation or recurrence of subsidisation

Belarus

While three producers in Belarus cooperated with the investigation, none reported a significant amount of export sales to the EU. During the RIP imports from Belarus virtually disappeared as compared to the investigation period of the original investigation dropping from more than 29,000 tonnes during the original investigation to 4 tonnes in the RIP. As a result, the Commission investigated the likelihood of recurrence of dumping.

As Belarus is not a member of the WTO normal value was to be determined on the basis of the price or constructed value in an appropriate representative country. However, in the absence of cooperation from any producer in a potential representative country, the normal value was instead based on the prices actually paid in the Union for the like product. For export prices, the Commission used Belarus’ sales prices to Russia, which absorbs 92% of the Belarusian exports of the product under review. The quantities exported to other third countries than Russia were negligible and therefore considered not to be representative. The import value in Russia was reported at CIF level so therefore, the Commission adjusted the reported prices to calculate the export price at ex-works level by deducting the domestic transport cost in Belarus. The comparison between normal value and the export price showed a likely countrywide dumping margin for the Belarusian exports to Russia expressed as a percentage of the CIF value of 8,0 %.

The investigation showed that the Belarusian exports to Russian were made on average at prices at least 5 % lower when compared to the average sales prices of the Union producers on the Union market. In addition, the Commission concluded that significant spare capacity existed in Belarus, estimated at around 50 000 tonnes for the cooperating producers (more than 9% of Union consumption) and could be as much as 125 000 tonnes for all producers. As a result, the Commission concluded that, given the attractiveness of the Union market in terms of size, prices and geographical proximity, and the significant spare capacity still available in Belarus, it was likely that Belarusian exports would be (re)directed towards the Union, if the measures be lapsed. Consequently, the Commission concluded that there was a likelihood of recurrence of dumping, if measures were not to be extended.

China

During the RIP, imports from China continued but at a much lower level than in the original investigation dropping from 184 887 tonnes to 559 tonnes in the RIP. Owing to a lack of cooperation by the China producers, the findings were based on facts available.

The Commission conducted the investigation in accordance with the provisions of Article 2(6a) of the basic Regulation as the request contained sufficient evidence of the existence of significant distortions in China. The evidence available showed that prices or costs in the WPT sector including the costs of capital, land, labour, energy and raw materials (particularly hot rolled steel coils, which are one of the main inputs) were not the result of free market forces because they are affected by substantial government intervention. The Commission also found evidence of preferential financing as well as many state-owned enterprises in the sector. As a result, the Commission concluded that it was not possible to use domestic prices and costs to establish normal value in this case. Therefore, normal value was calculated on the basis of undistorted prices or benchmarks from the representative country selected in the case, i.e. Thailand. To construct normal value, the Commission used the information provided by the Union industry on the consumption of each factor of production (raw materials, labour and energy) multiplied by the undistorted costs per unit established in Thailand. The calculation was done separately for two basic types of WPT, i.e. for black pipes/tubes and galvanized pipes/tubes. To this, the Commission added an appropriate percentage amount for manufacturing overheads and finally applied the SG&A and profit in Thailand which amounted to 4.3% and 3% respectively.

This normal value was compared to the export price which was calculated from Eurostat data corrected to ex-works level by adjusting for sea freight and insurance costs and domestic transport cost in China. On that basis, the weighted average dumping margin, expressed as a percentage of the CIF Union frontier price, duty unpaid, was found to be negative. However, given the volume of imports in question was limited and the prices were considered unrepresentative, the Commission decided to also investigate the likelihood of recurrence of dumping.

The investigation found that there were several trade defence measures in force against exports of WPT to other third countries including AD and CVD measures by Australia and Canada and AD measures by Colombia, Thailand and Mexico. These exports were made at prices between 8% to 21% lower when compared to the average sales prices of the Union producers on the Union market. In addition the investigation found that China’s spare capacity was more than ten times the total Union consumption during the RIP, with further increases in capacity expected. Given the attractiveness of the Union market in terms of size and prices, the fact that other markets remain closed due to protective measures and China’s spare capacities, the Commission concluded that it is likely that dumping of Chinese WPT was likely if measures were allowed to lapse.

Russia

During the RIP, imports from Russia continued but at a much lower level than in the original investigation, dropping from 36 000 tonnes to 2 000 tonnes in the RIP. Owing to a lack of full cooperation by Russian producers, the findings were based on facts available. The normal value was constructed using the information provided by PAO Severstal (a Russian company that had initially partially cooperated). Export price was based on CIF Eurostat data adjusted for freight, insurance and domestic transport costs in Russia to ex-works level. The comparison resulted in a dumping margin of 12,4 % so therefore the Commission concluded that dumping continued during the RIP. However, given the volume of imports from Russia was limited and the prices were considered unrepresentative, the Commission decided to also investigate the likelihood of recurrence of dumping.

The investigation showed that Russian exports, not only to the EU, but to other export markets were made at dumped prices and at prices around 29% lower as compared to the average sales prices of the Union producers on the Union market. The Commission also found that the spare capacity in Russia was very significant, exceeding the total Union consumption during the RUP. In addition, the Russian capacity of WPT production increased by almost 1 million tonnes between 2018 and 2019. The Commission concluded that, given the attractiveness of the Union market in terms of size and prices and the spare capacities in Russia, there was a likelihood of recurrence of dumping, if the measures were not extended.

Likelihood of continuation or recurrence of injury

The investigation showed that the financial situation for the Union industry deteriorated. Production and sales volumes decreased, which had a negative effect on employment and productivity as well as on profitability. The increased competition and price pressure from third country led to a negative profit margin of –11% for the Union industry during the RIP. The cash flow, investments and return on investments also deteriorated, which made it difficult for the Union industry to raise capital and invest. The Commission therefore concluded that the Union industry suffered material injury.

As regards the causal link, the volume of imports from the countries concerned was very low during the period considered, with a combined market share of imports of only 0,43% during the RIP. At the same time, a surge of low-priced imports from other third countries such as Turkey, India and the Republic of North Macedonia, put strong price and volume pressure on the Union industry sales increasing their market share from 42% to 50% between 2016 and 2019. As a result, the Commission concluded that the injury suffered by the Union industry could not have been caused by the imports from the countries concerned due to their very limited volume and therefore examined the likelihood of recurrence of injury originally caused by dumped imports from the countries concerned if the measures were repealed. This Commission considered that dumped imports of the product from the countries concerned would be made at prices which would undercut the Union producer prices and most likely gain market share at the expense of the Union industry as well as taking some market share of the exports from other third countries. This would cause an even greater deterioration of the profitability of the Union industry. The Commission concluded that in all likelihood injury would therefore recur if the measures were allowed to lapse. There was no information provided by importers, users or consumers to suggest that the maintenance of the anti-dumping measures would not be in the interest of the Union industry.

On 19 April 2021, the Commission extended the measures in place on imports of welded pipes and tubes from China, Russia and Belarus for another five-year period.

Rainbow trout originating in Turkey

On 27 February 2020, the Commission initiated an expiry review of the anti-subsidy measures imposed on imports of Rainbow trout originating in Turkey, following a request lodged by The Danish Aquaculture Organisation (TDAO) on behalf of producers representing more than 40% of the total Union production of rainbow trout. The initiation followed consultations on 20 February 2020 with the Government of Turkey (‘GOT’), held in accordance with the legislation. The GOT indicated that there had been a substantial change in Turkey’s support systems since 2013 and they considered that no expiry review was needed. However, the Commission was satisfied that there was sufficient evidence at initiation stage that the alleged subsidies were countervailable.

The product under review was the same as in the original investigation, namely rainbow trout (Oncorhynchus mykiss) (‘trout’): live weighing 1,2 kg or less each, or fresh, chilled, frozen and/or smoked: in the form of whole fish (with heads on), whether or not gilled, whether or not gutted, weighing 1,2 kg or less each, or — with heads off, whether or not gilled, whether or not gutted, weighing 1 kg or less each, or — in the form of fillets weighing 400 g or less each.

The review investigation period (RIP) ran from 1 January 2019 to 31 December 2019. The examination of trends relevant for the assessment of the likelihood of a continuation or recurrence of injury covered the period from 1 January 2016 to the end of the RIP (‘the period considered’).

Sampling

This sample consisted of nine Union producers (including one of frozen trout) all of which were Small to Medium sized Enterprises (‘SMEs’). The sample represented 13% of the Union production and was representative for the Union industry, given the large number of Union producers.

The Commission selected a sample of three exporting producers/groups of exporting producers who accounted for more than 70% of the declared exports to the Union during the review investigation period. No importers cooperated in the investigation.

Due to the outbreak of the COVID-19 pandemic the Commission was unable to carry out on-spot verification visits but instead performed remote cross-checks (‘RCCs’) of the information provided by the sampled companies.

Likelihood of continuation or recurrence of subsidisation

The Commission analysed the likelihood of continuation or recurrence of subsidisation if the measures expired. The Commission investigated the following subsidy programmes. Grants: Support of trout production weighing less than 1 kg; Support of trout production weighing more than 1 kg but not more than 1,2 kg; Support for breeding trout in hatcheries protected from disease; Closed system production; Fish farming in soil ponds; Support payments for agricultural publishing and consulting services; and Support for discarding of fishing vessels. Revenue foregone: Consumption tax rebate on fishing vessel fuel; and Support to investments made in the aquaculture sector. Direct transfer of funds: Supported insurance for the aquaculture sector; and Preferential loans. The Commission found that some schemes no longer applied such as Support for discarding of fishing vessels. For a number of other schemes, the companies in the sample were found to not to have benefitted from or did not qualify as recipients such as Support for breeding trout in hatcheries protected from disease; Closed system production; Fish farming in soil ponds. However, for a number of schemes it was found that during the review investigation period, Turkish exporting producers of the product concerned continued to benefit from countervailable subsidisation by the Turkish authorities. For those schemes, the total amount of subsidies found for the companies in the sample was 3,2% and 4,2%.

The investigation also examined whether exports to the Union would be made in significant volumes if the measures were lifted. The investigation showed that Turkey produced 95 000 tonnes of trout during the review investigation period and import volumes of trout from Turkey were around 20 500 tonnes whole fish equivalents in the same period, representing around 14 % of the Union market. There were no indications that these volumes would decrease if the measures were lifted and therefore the Commission concluded that there was a likelihood that subsidisation would continue if the measures were lifted.

Likelihood of continuation or recurrence of injury

Union consumption of rainbow trout slightly fluctuated during the period. However, overall, the consumption decreased by 2% going from 150 175 whole fish equivalent (WFE) tonnes in 2016 to 147 603 WFE tonnes in the RIP.

The import volume from Turkey decreased steadily between 2016 and 2018 and increased again in the RIP although overall the import volume fell by 6% during the period considered. Nevertheless, volumes of trout from Turkey were still substantial at 20 446 WFE tonnes in the RIP. Turkish imports’ market share decreased between 2016 and 2018 from 14,4 % to 11,4 % and then increased again in the RIP to 13,9 %. Import volumes from other third countries were low throughout the period and slightly decreased overall from 2 432 tonnes in 2016 to 2 118 tonnes in the RIP.

The import price from Turkey decreased between 2016 and 2018 by 5% and then increased by 3,5 % in the RIP. Overall, the import prices from Turkey were well below Union prices during the entire period concerned with a weighted average undercutting margin of 14,5%. The prices of other third countries’ imports increased by 2% during the period considered and were on average considerably higher (15%) than the prices of imports from Turkey.

The Commission evaluated the economic situation of the Union industry by examining relevant macroeconomic and microeconomic injury indicators. Production and sales volume, employment and productivity showed stable or slightly decreasing trends. Market share of the Union industry increased slightly during the period considered, while it decreased in the RIP reaching a similar level than in 2016. The increase of market share in 2017 and 2018 despite the relatively stable sales volume was due to the decreasing consumption during the same period. While the Union industry mostly maintained its sales volume and market share, this was at the expense of its profitability and other financial indicators - cash flow, return on investment showed negative or low values during the entire period considered. Despite the average unit sales price of the Union producers increasing slightly increase during the period considered, the industry did not manage to achieve sustainable profit margins. The Turkish imports exercised significant price suppression on the Union producers’ sales during the RIP and so the Union industry was unable to recover and made losses almost during the entire period considered. On that basis, the Commission concluded that the Union industry suffered material injury.

Causation

Turkish imports of trout remained substantial with market shares above 10% during the entire period at low price levels during the RIP, despite the anti-subsidy measures in force. As a result, the Union industry could not increase their prices in line with increasing costs which led to losses during almost the entire period considered. The investigation did not find any other factors that could have caused the material injury suffered by the Union industry.

Likelihood of continuation of injury

The total production of trout in Turkey during the RIP was 95 000 tonnes a major portion of which was exported. This production volume represented average capacity utilisation of only around 48% meaning overall capacity could be between 197 000 to 202 000 tonnes with the average spare capacity being around 101 000 to 102 000 tonnes. This amount would satisfy 70% of the total Union consumption. The Union market is Turkey’s largest export market, is geographically close and has already well-established distribution channels. It is therefore a very important market for Turkey. In view of these findings, namely the massive spare capacity in Turkey, the attractiveness of the Union market, the price levels of imports from Turkey and their likely impact on the Union industry, the Commission concluded that there was a likelihood of a continuation of injury should measures be allowed to lapse.

Union interest

The investigation showed that the Union industry was injured and if the measures were removed, it would lead to further damage from subsidised imports from Turkey. Therefore, the Commission concluded that it was in the interest of the Union industry to maintain measures. As no importers or users came forward, there was nothing to suggest that they would be negatively affected by a continuation of the measures. Therefore, the Commission concluded that there were no Union interest reasons against maintaining the measures on imports of trout originating in Turkey.

On 25 May 2021, the Commission extended the measures in place ranging from 1,5% to 9,5% on imports of rainbow trout from Turkey for a further five-year period.

Biodiesel originating in the USA – AD & AS

On 14 September 2020, the Commission initiated expiry reviews of both the anti-dumping and anti-subsidy measures imposed on imports of biodiesel originating in USA, following a request lodged by European Biodiesel Board (EBB) on behalf of producers representing more than 25% of the total Union production of biodiesel.

The product under review was the same as in in the original investigation and the previous expiry review, namely fatty acid mono-alkyl esters and/or paraffinic gasoil obtained from synthesis and/or hydro-treatment, of non-fossil origin, commonly known as ‘biodiesel’, in pure form or in a blend containing by weight more than 20 % of fatty acid mono-alkyl esters and/or paraffinic gasoil obtained from synthesis and/or hydro-treatment, of non-fossil origin,

The review investigation periods in the AD and AS investigations (RIP) ran from 1 July 2019 to 30 June 2020. The examination of trends relevant for the assessment of the likelihood of a continuation or recurrence of injury covered the period from 1 January 2017 to the end of the RIP (‘the period considered’).

The cases were initiated during the transition period agreed between the United Kingdom (‘UK’) and the EU in which the UK remained subject to the Union law. As of 1 January 2021, companies and associations from the UK no longer qualified as interested parties in the proceeding. BP OIL International Limited and Argent Energy requested to continue to be considered as interested parties and were granted this right based on the evidence proving the existence of related entities active on the Union market.

Sampling

Sampling applied to Union producers. The sample consisted of three Union producers accounting for 17 % of the estimated total production volumes of the product in the Union while ensuring a good geographical spread. One unrelated importer cooperated. Sampling of exporting producers was not necessary as only three companies came forward initially. However, they subsequently did not cooperate in the expiry review investigation. Therefore, the Commission relied on the provisions of Article 18 of the basic Regulation (i.e. best facts available).

Likelihood of continuation or recurrence of dumping

Given the absence of cooperation, the Commission used information from the following sources: the request for an expiry review and subsequent submissions from the applicant, Eurostat, the Global Trade Atlas (‘GTA’) and the websites of the US Energy Information Administration (‘EIA’) and the US Department of Agriculture (‘USDA’).

Following the imposition of measures in 2009, imports of biodiesel from the USA to the Union dropped significantly to about 156 tonnes during the RIP representing only 0,04 % of total US exports and even less of the Union consumption. The Commission decided that such low volumes did not provide a sufficient basis for a continuation of a dumping analysis and therefore focused the investigation on the likelihood of recurrence of dumping if the measures were to lapse.

The Commission found that the Union market, the biggest in the world, is very attractive and there are significant Union and national incentives for biodiesel consumption. The investigation revealed that average US export price to third countries was around EUR 617 and would be far below the Union industry ex-works price of EUR 771 per tonne. As a result, it was concluded that it would be a good market for the US producers to export their spare capacity of 32 %, or around 2 694 000 tonnes, and also to divert some of their export sales from other less profitable third countries into the Union market. In addition, the fact that the measures imposed in 2009 were found to be circumvented by means of transhipments via Canada and a change in the composition of the blend, showed the continued interest of some US producers in the Union market. Given these facts the Commission concluded that dumped imports from the USA were likely to recur if the measures in force lapsed.

Likelihood of continuation or recurrence of subsidisation

The Commission analysed the likelihood of continuation or recurrence of subsidisation if the measures expired. The Commission investigated the following Federal and State subsidy programmes which were listed in the review request - Federal Schemes: (a) The Biodiesel Mixture Credit and the Biodiesel Credit (b) The Small Agri-biodiesel Producer Income Tax Credit (c) The USDA bioenergy programme for advanced biofuels (d) Credit for Production of Cellulosic Biofuel (e) USDA Biorefinery, Renewable Chemical, and Biobased Product Manufacturing Assistance Programme. State Schemes: (a) The Iowa Biodiesel Producer Tax Refund (b) The Kentucky Biodiesel Production Tax Credit (c) The Texas Fuel Ethanol and Biodiesel Production Incentive Programme.

The Commission found that all of the schemes investigated were still in place and, given the lack of cooperation from the US authorities and the US exporting producers, the Commission concluded that the US biodiesel producers continue to benefit from them and that the subsidy amounts were above de minimis.

The investigation then examined whether exports to the Union would be made in significant volumes if the measures were lifted. The investigation showed that imports from USA had dropped to almost zero after measures were imposed dropping to almost zero from 2013 onwards. Data from the US Energy Information Administration indicated that US biodiesel producers’ capacity during the review investigation period was 8,412,000 tonnes. Actual production of biodiesel during the RIP was 5,718,000 tonnes (EIA data), capacity utilisation of 68 %. Thus, there was spare capacity of 32 %, or around 2,694,000 tonnes. The Commission concluded that if export market opportunities presented themselves then the US producers would be likely to use their spare capacity for export sales. The investigation also showed that the exporting producers from the USA would be able to sell at a price below €771 per tonne to penetrate the Union market. This would be an incentive for them to redirect some of their current exports to third countries towards the Union market, as it is more attractively priced than some other third countries’ markets. The fact that the anti-subsidy measures imposed in 2009 were circumvented by transhipments via Canada and a change in the composition of the blend also indicated the interest and attractiveness of the Union market to some US producers. In view of these findings, the Commission concluded that it would be likely that US biodiesel producers would resume exporting biodiesel at subsidised prices to the Union market at large volumes, if measures were allowed to lapse.

Likelihood of continuation or recurrence of injury

Union consumption increased by 22 % from 13,8 million tonnes in 2017 to 16,9 million tonnes during the RIP.

There were virtually no imports of biodiesel from the US to the Union during the review investigation period. As a result, the average prices could not be considered representative and could not be used as a reliable basis for calculating undercutting. Instead, the Commission calculated price undercutting during the review investigation period by comparing the weighted average sales prices of the sampled Union producers to unrelated customers on the Union market with the average export price of US producers to third countries resulting in price undercutting of 6,4%.

The Commission evaluated the economic situation of the Union industry by examining relevant macroeconomic and microeconomic injury indicators. During the period considered while there were almost no imports from the USA, imports from third countries except the US increased by 145 % during the period considered. The price level of these imports increased as well (by 11%) while, at the same time, the prices of the Union industry decreased (by 8%), in line with a decrease in the production costs (by 9%). This price gap between third countries exporters and the sampled Union producers reduced, thereby increasing the competitiveness of the Union industry. Overall, the injury indicators showed a positive trend during the period considered, with increases in production (+11%), production capacity (+9%) and sales (+7%) indicating that the Union biodiesel industry was recovering from past injury. While some indicators, in particular a low profitability (≤ 3%) indicated that the industry remained in a fragile economic situation, the Commission concluded that the Union industry was not suffering material injury.

The Commission then examined the likelihood of a recurrence of injury if measures were to lapse. The investigation found that the US spare capacities represented 18 % of the Union consumption during the RIP. The Commission also found that the US producers exported to their main third markets at prices lower than the domestic prices in the US and that those prices would, on average, undercut the Union industry prices by 6,4 %. Therefore, the Commission concluded that, if measures were to lapse, significant volumes of subsidised biodiesel from the USA would exert a very strong downward pressure on Union prices and have a significant impact on the Union industry’s economic situation. As a result, the Commission concluded that the absence of measures would in all likelihood result in a recurrence of injury.

Union interest

The investigation showed that the Union industry would, in all likelihood, be injured if the measures were removed so it was in the interest of the Union industry to maintain measures. No importers objected to a continuation of the measures. Two users claimed that the prolongation of the measures would be a direct hindrance for the green development of the transport sector in Europe and Hydrotreated Vegetable Oil (HVO) should be excluded from the current product scope as they expected a shortage of HVO in the coming years. However, there was no evidence to support their claims. The Commission therefore concluded that the continuation of the measures would not be detrimental to the interest of the users.

On 2 August 2021, the Commission extended the anti-dumping and anti-subsidy measures in place on imports of biodiesel from USA for a further five-year period. The duties were also extended for five years to imports of biodiesel consigned from Canada, which had been found to be circumventing the measures in place on US imports in 2011.

PSC wires and strands originating in the China

On 4 June 2020, the Commission initiated an expiry review of the anti-dumping measures imposed on imports of PSC wires and strands originating in China, following a request lodged by European Stress Information Service on behalf of producers representing more than 25% of the total Union production of PSC wires and strands.

The product subject to this review is not plated or not coated wire of non-alloy steel, wire of non-alloy steel plated or coated with zinc and stranded wire of non-alloy steel whether or not plated or coated with not more than 18 wires, containing by weight 0,6 % or more of carbon, with a maximum cross-sectional dimension exceeding 3 mm. The product is mostly used as a concrete reinforcement by the construction industry but can also be found in suspension elements and in stay cable bridges.

The review investigation period (RIP) ran from 1 January 2019 to 31 December 2019. The examination of trends relevant for the assessment of the likelihood of a continuation or recurrence of injury covered the period from 1 January 2016 to the end of the RIP (‘the period considered’).

Sampling

Sampling applied to Union producers. The sample consisted of three Union producers accounting for 46% of the estimated total production volumes of the product in the Union while ensuring a good geographical spread.

There was no cooperation from Chinese producers or importers. As a result, findings with regard to the imports from China were based on the facts available in line with Article 18 of the basic Regulation.

Likelihood of continuation or recurrence of dumping

Due to the absence of cooperation by any Chinese exporters, the Commission based the findings in relation to the likelihood of continuation or recurrence of dumping on facts available. This included information in the request, submissions by the interested parties, as well as data such as trade statistics on imports and exports (Eurostat and GTA), and OECD and other sources of market information such as Global Financials published by Dun & Bradstreet and Global Trade Alert.

The Commission conducted the investigation in accordance with the provisions of Article 2(6a) of the basic Regulation as the request contained sufficient evidence of the existence of significant distortions in China. The evidence available showed that prices or costs of the product under review, including the costs of raw materials, energy and labour, were not the result of free market forces owing to substantial government intervention. As a result, the Commission concluded that it was not possible to use domestic prices and costs to establish normal value in this case. Therefore, normal value was calculated on the basis of undistorted prices or benchmarks from the representative country selected in the case, i.e. Turkey. To construct normal value, the Commission used the information provided by the Union industry on the consumption of each factor of production (raw materials, labour and energy) multiplied by the undistorted costs per unit established in Turkey. To this, the Commission added an appropriate percentage amount for manufacturing overheads and finally applied the SG&A and profit in Turkey which amounted to 11,62 % and 9,39 % respectively.

As far as the export price was concerned, the volume of imports was very limited, only 86 tonnes in the RIP (0,34 % of the Union imports in total and 0,02 % of the share in the Union market), and were therefore considered unrepresentative. Hence the Commission was unable to determine whether dumping continued during the RIP.

The Commission investigated the likelihood of recurrence of dumping if the measures were allowed to lapse. The Commission examined the price behaviour of Chinese exporters to their two largest export markets the Philippines and Korea. The Commission compared the constructed normal value for China with Chinese export prices of PSC to these markets which showed that PSC was exported at prices on average 35% lower than the normal value. As far as the production capacity in China is concerned the applicant showed that this substantially exceeded the domestic demand on the Chinese market with spare production capacity of around 2 million tonnes. On this basis the Commission concluded that the Chinese exporting producers have significant spare capacities, which they could use to produce and export to the Union if the measures were allowed to lapse. The investigation also showed that there are anti-dumping measures applied in Brazil, Canada, Chinese Taipei, Colombia, Mexico, South Africa, Turkey, Ukraine, UK and USA and anti-subsidy measures in Chinese Taipei and USA as well as safeguard measures in Chile and UK, these markets as well confirming the unfair trade practices of the Chinese PSC producers. The Commission also established that the EU market was attractive for the Chinese producers owing to price levels and its size. Because of the foregoing, the Commission concluded that that there would be recurrence of dumping from Chinese imports towards the Union if the measures were to lapse.

Likelihood of continuation or recurrence of injury

For the injury determination, the Commission examined both macroeconomic and microeconomic injury indicators including production, production capacity, capacity utilisation, sales volume, market share, growth, employment, productivity, magnitude of the dumping margin, and recovery from past dumping as well as average unit prices, unit cost, labour costs, inventories, profitability, cash flow, investments, return on investments and ability to raise capital.

The Union production increased by 3% over the period following largely the evolution of the consumption (i.e. increase of 5-7% in 2017-2018, followed by a drop in RIP). The production capacity increased overall by 13% during the period considered as a result of investments by several Union producers in response to demand when the construction sector was growing. This led to a drop in capacity utilisation levels from 76% to 70% in the period considered. Market share of the Union industry remained stable during the period considered. Employment of the Union industry increased by 10% during the period considered. Due to the slower increase in production over that period, the productivity decreased by 6% over the same period. The Union industry’s average unit selling price to unrelated customers increased by 18% over the period considered, essentially reflecting increases costs of production (mainly cost of wire rod). Relieved from the pressure of dumped imports from China, the Union industry managed to overcome the challenges posed by demand fluctuations and rising production costs. As a result, the Commission concluded that the Union industry did not suffer material injury during the review investigation period. However, the industry remained vulnerable, indicated by break-even profit levels and high volatility of demand.

As regards the likelihood of a recurrence of injury, given the estimated Chinese spare capacity and the expected price levels of Chinese exports to the EU, the Commission concluded that the non-extension of the measures would, in all likelihood, lead to a recurrence of injury and further damage the vulnerable situation of the Union industry.

Union interest

No importers or users came forward to give a position in relation to the continuation of measures. While it was rules out that the imposition of the measures could have a negative impact on their activity, there were other sources of supply available to them. There were no valid arguments that maintaining the measures would have a negative impact that would outweigh the positive impact of the measures on the Union industry. Therefore, the Commission concluded that there were Union interest reasons against the extension of the measures on imports from China. Because of the foregoing, the Commission decided to extend the measures on PSC wires and strands for a further five-year period from September 2021.

Stainless steel cold-rolled flat products originating in the China and Taiwan

On 25 August 2020, the Commission initiated an expiry review with regard to imports of stainless steel cold-rolled flat products originating in China and Taiwan, following a request lodged by European Steel Association representing more than 25% of the total Union production of stainless steel cold-rolled flat products.

The product under review was the same as in the original investigation, namely flat-rolled products of stainless steel, not further worked than cold-rolled (cold-reduced). The product is used in a wide range of downstream industries, for example construction and energy equipment, infrastructure, consumer goods, and vehicles.

The review investigation period (RIP) ran from 1 July 2019 to 30 June 2020 and the examination of trends relevant for the assessment of the likelihood of a continuation or recurrence of injury covered the period from 1 January 2017 to the end of the review investigation period (RIP).

Sampling

The Commission selected a sample of three Union producers accounting for more than 60% of the estimated total Union production and around 70% of the estimated total Union sales volume of the product under review. Sampling was not necessary for unrelated importers as only three made themselves known as interested parties Only one exporting producer from Taiwan came forward but later failed to cooperate and no producers from China came forward. As a result, the Commission applied Article 18 of the basic Regulation basing its findings for on facts available.

Due to the outbreak of the COVID-19 pandemic the Commission was unable to carry out on-spot verification visits but instead performed remote cross-checks (‘RCCs’) of the information provided by the sampled companies.

Likelihood of continuation or recurrence of dumping

China

Imports of SSCR from China continued at much lower levels than in the original investigation dropping from 143 420 tonnes to 14 111 tonnes in the review investigation period and accounting for about 0,4 % of the Union market.

As regards China, the Commission finding on the likelihood of continuation or recurrence of dumping was based on information contained in the expiry review request, submissions by interested parties as well as sources such as trade statistics on imports and exports (Eurostat and GTA), statistical data from the Chinese tax and custom administration websites, World Bank and OECD reports, and independent providers of pricing intelligence, news, data, analysis and conferences for the iron and steel industry.

The Commission conducted the investigation in accordance with the provisions of Article 2(6a) of the basic Regulation as the request contained sufficient evidence of the existence of significant distortions in China. The evidence available showed distortions arising from factors such as, a substantial degree of ownership by the GOC in the steel sector, the State’s presence and intervention in the financial markets, as well as in the provision of raw materials and inputs including land use rights, the distortive effects of the 13th Five Year Steel Plans for the steel industry, Mineral Resources and the Non-Ferrous Metal Industry. As a result, the Commission concluded that it was not possible to use domestic prices and costs to establish normal value in this case. Therefore, normal value was calculated on the basis of undistorted prices/benchmarks from the representative country selected in the case, i.e. Brazil.

To construct normal value, the Commission used the information provided by the Union industry on the consumption of each factor of production multiplied by the undistorted costs per unit established in Brazil. The calculation was done for one basic type of SSCR (i.e. for grade 304) which was the steel grade mostly sold in and exported to the Union. To this, the Commission added an appropriate percentage amount for manufacturing overheads. Then the Commission added an appropriate percentage amount for SG&A and profit in Brazil, which amounted to 11,62% and 9,39% respectively. The Commission compared the constructed normal value with the export price based on CIF Eurostat data which was reduced by the sea freight, insurance costs and domestic transport cost in China. The weighted average dumping margin established for China was 17,9%.

To determine the likelihood of a recurrence of dumping, the Commission also analysed production and spare capacity in China, the attractiveness of the Union market and the relation between export prices to third countries and the price level in the Union. Spare capacity in China was found to be around 2 million tonnes representing 62,5 % of the Union consumption of SSCR in the RIP (3,2 million tonnes). The Commission also found that globally, there were many trade defence measures and other import restrictions in force against exports of SSCR including anti-dumping measures in Brazil, Canada, Malaysia, Mexico, Taiwan, Thailand, United Kingdom, USA, and Vietnam, and countervailing duties in the USA. This showed that unfair trade practices were taking place as well as limiting the access of Chinese producers to those markets. The Commission also found that Chinese export prices to these six countries were between 19% and 37% lower than average Chinese sales prices to the EU. Given these factors, the Commission concluded that the Union market is an attractive market for Chinese producers of SSCR and that it was likely they would direct exports towards the Union if the measures lapsed.

Taiwan

According to Eurostat, imports of SSCR from Taiwan dropped from 169,097 tonnes in the investigation period of the original investigation to 165 540 tonnes in the RIP representing a market share of 5,3% of the Union market.

To establish the normal value, the Commission used adjusted average Taiwanese domestic selling prices of different grades and dimensions of SSCR in 2019 as provided by the applicant based on market intelligence. These prices needed to be adjusted to a profitable level as domestic sales prices in Taiwan were deemed loss-making given the price pressure from significant imports penetrating the Taiwanese market. The Commission therefore constructed normal value by adding a reasonable profit as used by the applicant, i.e. 6%.

Export prices were based on prices of Taiwanese exports from Eurostat. These were adjusted to ex-works level by deducting freight, insurance and domestic transport costs in Taiwan. The Commission compared the normal value and the export price yielding a dumping margin for Taiwan of 12%, showing that dumping had continued. The Commission found that Taiwan’s spare capacity amounted to 18,5% of the total Union consumption during the RIP. Clearly, the Union market was attractive given the Taiwanese continued to export significant quantities in spite of the measures in place. Furthermore, the Commission found that Taiwanese export prices to other third country markets were well below their sales prices to the Union. As a result, the Commission concluded that there was a strong likelihood that dumping from Taiwan would continue if the measures lapsed.

Likelihood of continuation or recurrence of injury

The investigation showed that the financial situation for the Union industry deteriorated during the period considered. The Union industry was forced to lower its sales prices (by around 3%) due to pressure from dumped Taiwanese imports. At the same time their cost of production increased by 3% severely affecting the Union industry’s profitability, which fell by 94% over the period considered (going from 7,6% in 2017 to 0,4 % in the RIP). The Union consumption decreased significantly during the period considered and both sales volumes and production volumes on the Union industry followed this trend. Union producers experienced a sharp decrease in productivity and capacity utilisation in the period considered. Other financial indicators also showed a negative picture: investments (– 13%), return on investments (– 80%) and cash flow (– 52%). On this basis, the Commission concluded that the Union industry suffered material injury.

The Commission concluded that given the spare capacity in PRC, the attractiveness of the Union market and the expected prices of imports from the PRC, in the absence of antidumping measures, the removal of the measures would, in all likelihood, result in a significant increase of dumped imports from the PRC and material injury would be likely to recur. Given the spare capacity in Taiwan (representing 18,5 % of the total Union consumption in the RIP), their continued presence at low prices on the EU market despite measures, the Commission also concluded that a lapse of measures would, in all likelihood, result in a significant increase of dumped imports from Taiwan at injurious prices and material injury would be likely to continue.

Causation

The volume of imports from China remained below de minimis level during the entire period considered and the process did not undercut the prices of the Union industry. Therefore, the Commission concluded that the material injury suffered by the Union industry could not have been caused by the imports from China. However, as regards Taiwan, the Commission concluded that continued price suppression from dumped imports adversely affected the Union industry. Given the volume, markets share, and low prices of the dumped imports from Taiwan, they affected the prices of the European industry. The Commission concluded that the material injury suffered by the Union industry was caused by the imports from Taiwan.

Union interest and measures

Despite contacting all known unrelated importers, traders and users, none of them replied to the questionnaire or cooperated in the expiry review. While there were claims of shortages of supply, the Commission concluded that disruptions in the supply chain caused by the COVID-19 pandemic are of exceptional nature and are not specific to the SSCR supply chain. The investigation also identified other sources of supply from other third countries. On this basis, the Commission concluded that the effects of extending the anti-dumping measures on importers and users would not outweigh the positive impact of the measures on the Union industry. As a result, the Commission decided to continue the measures in place on SSCR from China and Taiwan for a further period of five years in September 2021.

3.2.1.4.    Expiry reviews concluded by termination

In 2021, the Commission did not conclude any expiry review by terminating the measures in force.

3.2.2.    Interim reviews

Article 11(3) and Article 19 of the basic Regulations provide for the review of measures during their period of validity on the initiative of the Commission, at the request of a Member State or, provided that at least one year has lapsed since the imposition of the definitive measure, following a request containing sufficient evidence by an exporter, an importer or by the EU producers. In carrying out the investigations, it will be examined, inter alia, whether the circumstances with regard to dumping/subsidisation and injury have changed significantly and whether these changes are of a lasting nature. Reviews can be limited to dumping/subsidisation or injury aspects.

During 2021, the Commission initiated 4 interim reviews (2 on anti-dumping measures and 2 on countervailing measures). No interim reviews were concluded in the year. More information can be obtained from the Official Journal publications to which reference is given in Annex G.

3.2.3.    New exporter reviews

As far as anti-dumping measures are concerned, Article 11(4) of the basic AD Regulation allows for a review ("newcomer" review) to be carried out in order to determine individual margins of dumping for new exporters located in the exporting country in question, which did not export the product during the IP.

Parties have to show that they are genuine new exporters, i.e. that they are not related to any of the exporters or producers in the exporting country, which are subject to the anti-dumping measures, and that they have actually started to export to the EU following the IP, or that they have entered into an irrevocable contractual obligation to export a significant quantity to the EU.

When a review for a new exporter is initiated, the duties are repealed with regard to that exporter. However, its imports become subject to registration under Article 14(5) of the basic AD Regulation in order to ensure that, should the review result in a determination of dumping for that exporter, anti-dumping duties may be levied retroactively to the date of the initiation of the review.

As far as anti-subsidy measures are concerned, Article 20 of the basic AS Regulation allows for a review (accelerated review) to be carried out in order to promptly establish an individual countervailing duty. Any exporter whose exports are subject to a definitive countervailing duty but who was not individually investigated during the original investigation for reasons other than a refusal to co-operate with the Commission can request such review.

In 2021, the Commission initiated 5 ‘new exporter’ reviews (Annex I). Since the Commission carried out the first review of this type in 1990, a total of 85 such reviews have been initiated so far. In 2021, one such review was completed.

3.2.4.    Anti-absorption investigations

Where there is sufficient information showing that, after the original IP and prior to or following the imposition of measures, export prices have decreased or that there has been no or insufficient movement in the resale prices or subsequent selling prices of the imported product in the EU, an absorption review may be opened. This examines whether the measure has had effects on the export prices. The duty may be increased to take account of such lower export prices. The possibility of absorption reviews is included in Articles 12 and 19(3) of the basic Regulations.

In 2021, 1 anti-absorption investigation was initiated on AD measures (Annex J).

3.2.5.    Anti-circumvention investigations

The possibility of investigations being opened in circumstances where evidence is brought to show that measures are being circumvented is covered in Articles 13 and 23 of the basic AD and AS Regulations respectively.

Circumvention is defined as a change in the pattern of trade between third countries and the EU that stems from a practice, process or work for which there is insufficient cause or economic justification other than the imposition of the duty. The duties may be extended to imports from third countries of like products, or parts thereof, if circumvention is taking place. Duties may also be extended to imports of a slightly modified like product from the country subject to current measures.

In 2021, the Commission initiated 4 anti-circumvention investigations (2 on anti-dumping measures and 2 on countervailing measures). Two such reviews were concluded with an extension of duty to other exporting countries. No anti-circumvention investigation was concluded without extending the measures. In 2021, there was further an increase in cases where OLAF pointed to improprieties by Union based companies benefitting from exemptions from the duties applicable to certain bicycle parts. This led the Commission trade defence services to re-examine the situation of three companies.

More information can be obtained from the Official Journal publications to which reference is given in Annex K.

3.2.5.1 Details of some individual cases concluded by extension of duty

Certain aluminium foil (jumbo rolls) originating in China (measures extended to Thailand)

In October 2009, the Council imposed a definitive anti-dumping duty on imports of certain aluminium foil originating in China. The measures ranged between 6,4 % and 30,0%. In December 2015, the European Commission maintained the measures following an expiry review and in February 2017, following an anti-circumvention investigation extended the measures to imports of slightly modified certain aluminium foil from China.

In November 2020, the Commission received a request to investigate possible circumvention of the anti-dumping measures imposed on China by imports coming from Thailand. The applicant requested anonymity both at application stage and for the duration of the investigation and duly substantiated its request, which was accepted by the Commission as it considered there were sufficient grounds to grant the confidentiality of its identity. The evidence in the request indicated there was a change in the pattern of trade appearing to stem from the consignment of jumbo rolls via Thailand to the EU after having undergone assembly operations in Thailand. It also showed that these assembly operations constituted circumvention as Chinese parts accounted for more than 60% of the total value of the assembled product, while the value added during the assembly operation was lower than 25% of the manufacturing cost. Furthermore, the request showed that these actions were undermining the effects of the measures in terms of quantities and prices and imports consigned from Thailand were being dumped.

The product subject to investigation is aluminium foil of a thickness of not less than 0,008 mm and not more than 0,018 mm, not backed, not further worked than rolled, in rolls of a width not exceeding 650 mm and of a weight exceeding 10 kg, aluminium foil of a thickness of not less than 0,007 mm and less than 0,008 mm, regardless of the width of the rolls, whether or not annealed, aluminium foil of a thickness of not less than 0,008 mm and not more than 0,018 mm and in rolls of a width exceeding 650 mm, whether or not annealed, aluminium foil of a thickness of more than 0,018 mm and less than 0,021 mm, regardless of the width of the rolls, whether or not annealed, and/or aluminium foil of a thickness of not less than 0,021 mm and not more than 0,045 mm, when presented with at least two layers, regardless of the width of the rolls, whether or not annealed.

On the basis of the request, the Commission opened an anti-circumvention investigation in December 2020 and made imports of jumbo rolls of aluminium from Thailand, subject to registration. The investigation period ran from 1 January 2016 to 30 June 2020 (the ‘IP’).

Change in the pattern of trade

The investigation showed that between 2016 and the end of the IP there was a huge increase in imports of the product from Thailand going from 18 tonnes to 5 801 tonnes representing an increase in share of total imports from 0,03 % to 8,53%. Initially it appeared that imports from China also increased in the period, though at a much smaller pace, from 8 948 to 26 466 tonnes representing an increase in the share of total imports from 16% to 39%. However, closer examination of the statistics showed that, in fact, the bulk of these imports were made by Chinese exporting producers that did not export aluminium household foil, but rather converter foil, which was not the product under investigation. When this was taken into account, it showed that there was a significant decrease in the import volumes from China to only 307 tonnes in the reporting period. This was confirmed by a cooperating unrelated importer in the EU, who provided information showing that, while previously they purchased their jumbo rolls from China from 2019 onwards they were sourced from Thailand.

The investigation also revealed that since 2016, there was a continuous increase in the exports of foil stock (the main raw material for the production of aluminium household foil) from China to Thailand. The exports increased from 50,111 tonnes in 2016 to 71 668 tonnes at the end of the IP. While only a portion of these foil stock imports was actually used in the jumbo rolls production process the increase was, in part, explained by the increase in the production and exports of jumbo rolls from Thailand.

The increase of jumbo rolls exported from Thailand to the EU along with the parallel decrease of jumbo rolls exported from China to the EU constituted a significant change in the pattern of trade. This was further confirmed by the increase in exports of the main raw material from China to Thailand in the same period.

Practice to avoid the duties

As the evidence in the request pointed to assembly operations in Thailand, the Commission analysed whether the criteria set out in the basic Regulation were met. In particular, the Commission examined whether the assembly operation started or substantially increased since, or just prior to, the initiation of the anti-dumping investigation and whether the parts concerned were from the country subject to measures. It also examined if the parts constituted 60% or more of the total value of the parts of the assembled product and whether the added value of the parts brought in, during the assembly or completion operation, was greater than 25% of the manufacturing costs.

The cooperating group of companies in Thailand, the Dingsheng Group, accounted for more than 95% of all exports to the EU during the reporting period. Dingheng is a subsidiary of the Chinese-owned Dingsheng Group. In previous investigations concerning jumbo rolls companies within the Dingsheng Group found to be dumping jumbo rolls and then circumventing the duties by slightly modifying the product. Dingheng explained that it started jumbo rolls production in Thailand in order to establish a presence abroad of the Dingsheng Group, in line with ‘its mission of globalization and transnational blueprint’. However, the investigation found that no imports from the relevant Chinese exporting producer in the Dingsheng Group were made since the previous anti-circumvention investigation, which coincides in time with when Dingheng started exporting to the Union from Thailand. Furthermore, the investigation showed that the situation during the reporting period did not reflect the company’s intentions as laid out in its investment plan. The company could not provide any evidence of economic justification for exporting jumbo rolls from Thailand to the Union. Contrary to what the company indicated in its investment plans (dated after the establishment of the production site in Thailand), Dingheng sourced all its raw materials from China and produced all jumbo rolls from imported aluminium foil stock. In addition, it complemented its own production of jumbo rolls by purchasing jumbo rolls from its related companies in China to meet customer demand during the reporting period. The Commission also found, in an internet search, that the avoidance of paying anti-dumping duties was used by Dingheng to attract customers, indicating that, the avoidance of anti-dumping duties played a role in the economic and marketing decisions of the company. The Commission concluded that the assembly operation started after the initiation of the anti-dumping investigation, while the parts were from the country subject to measures.

Dingheng produces jumbo rolls from foil stock. The production process, according to the company’s exemption request, consists of operations such as further rolling, slitting, annealing and packaging. However, the Commission considered these operations as relatively minor when compared to the production process that takes place before the input material arrives at the Dingheng production site. The steps to turn the foil stock into jumbo rolls are relatively minor in scope and, of a relatively limited added value. Furthermore, the change in commodity heading could not be considered as proof of significant transformation of the input material.

In order to examine the value added aspect, this was determined as the sum of labour costs and factory overheads incurred by the assembler with respect to those parts. Selling, general and administrative expenses as well as profit were not taken into account. In this case, the value added, when expressed as a percentage of the manufacturing cost, was found to be significantly below the 25% threshold set in the basic Regulation.

Undermining the remedial effect of the measures and dumping

The Commission examined if the imports from Thailand (quantities and prices), undermined the effects of the measures in force. The increase of imports of jumbo rolls from Thailand was significant, increased from less than 1% of the total volume of imports of jumbo rolls in 2016 to almost 9% during the reporting period. At the same time, the imports from Chinese companies decreased from 13% in 2016, to less than 1% during the reporting period. The investigation also showed that the cooperating companies imported jumbo rolls at dumped prices during the reporting period. The Commission also compared the average non-injurious price from the last expiry review with the weighted average export CIF prices from Thailand and this revealed underselling of 49% and undercutting of 40%. Hence, the Commission concluded that the existing measures were being undermined by the volume and prices of the imports from Thailand.

Extension of the measures

Based on the above findings, the Commission concluded that the anti-dumping duty imposed on imports of jumbo rolls originating China were being circumvented by imports from Thailand. Given that exports of the cooperating company constituted more than 95% of the total imports of the product under investigation and no other exporting producer cooperated, this conclusion applied to the whole country. On this basis, on 14 September 2021, the Commission extended the anti-dumping measures in force on China to imports of the product under investigation consigned from Thailand.

Certain aluminium foil in rolls (small rolls) originating in China (measures extended to Thailand)

In March 2013, the Council imposed a definitive anti-dumping duties ranging between 14,2 % and 35,6 % on imports of certain aluminium foils in rolls (‘small rolls’) originating in China. In June 2019, following an expiry review, the Commission maintained the measures in force.

In November 2020, the Commission received a request to investigate possible circumvention of the anti-dumping measures imposed on China by imports coming from Thailand. The applicant requested anonymity both at application stage and for the duration of the investigation and duly substantiated its request, which was accepted by the Commission as it considered there were sufficient grounds to grant the confidentiality of its identity. The request contained evidence of a change in the pattern of trade involving exports from China and Thailand to the Union that had taken place following the imposition of measures on small rolls. This appeared to stem from the consignment of small rolls via Thailand to the Union after having undergone assembly operations in Thailand. The request also contained evidence that assembly operations constituted circumvention as Chinese parts accounted for more than 60 % of the total value of the parts of the assembled product, while the value added during the assembly operations was less than 25 % of the manufacturing cost. Furthermore, the request showed that these actions were undermining the effects of the measures in terms of quantities and prices and that imports consigned from Thailand were being dumped.

The product concerned is aluminium foil of a thickness of 0,007 mm or more but less than 0,021 mm, not backed, not further worked than rolled, whether or not embossed, in low weight rolls of a weight not exceeding 10 kg.

On the basis of the request, the Commission opened an anti-circumvention investigation in December 2020 and made imports of small rolls of aluminium from Thailand subject to registration. The investigation period ran from 1 January 2016 to 30 June 2020 (the ‘IP’).

No Thai producer of the product cooperated in the investigation so findings were based on facts available, particularly from the request, along with information from other sources, such as Eurostat and Global Trade Atlas (‘GTA’).

Change in the pattern of trade

Between 2016 and the end of the reporting period there was a large increase in imports from Thailand, which went from 70 tonnes to 1 069 tonnes representing an increase in its share of total imports from 2% to 14%. Imports from China also increased but at a much smaller pace, from 299 to 414 tonnes with the Chinese share of total imports decreasing from 8% to 5%.

The information available to the Commission from the request showed that the production of the small rolls, which are exported from Thailand to the EU, is mainly done from the intermediate raw materials foil stock or jumbo rolls. The investigation found that since 2016, there was a continuous increase in the exports of the raw materials from China to Thailand. While only a portion of the foil stock imports is used in the small rolls production process (the percentage used for small rolls was not available), it was assumed that the ratio of converter foil production versus household foil production in Thailand remained stable throughout the IP. In fact, indications were that production of household foil had increased.

The increase of small rolls exported from Thailand to the EU along with the parallel decrease of those rolls exported from China to the EU constituted a significant change in the pattern of trade. This was confirmed by the increase in exports of the main raw material from China to Thailand in the same period.

Practice to avoid the duties

As the evidence in the request pointed to assembly operations in Thailand, the Commission analysed whether the criteria set out in the basic Regulation were met. These are; whether the assembly operation started or substantially increased since, or just prior to, the initiation of the anti-dumping investigation and whether the parts concerned were from the country subject to measures, and whether the parts constitute 60 % or more of the total value of the parts of the assembled product and whether the added value of the parts brought in, during the assembly or completion operation, was greater than 25 % of the manufacturing costs.

The request provided evidence that small rolls in Thailand were produced by rewinding jumbo rolls sourced directly from China or indirectly from Thai producers who source the raw materials to produce jumbo rolls from China. It also showed that Thai producers do not possess the machinery necessary to produce small rolls from primary aluminium, but only to rewind, cut, slit, anneal and perform other relatively minor operations on jumbo rolls. Based on information provided by the applicant, the value added, when expressed as a percentage of the manufacturing cost, was found to be significantly below the 25% threshold set in the basic Regulation.

The applicant also gave information showing that Thai exporting producers of small rolls are subsidiaries of Chinese companies, which also produce small rolls in China. The investigation found no evidence of economic justification for importing the small rolls from Thailand to the Union, other than avoiding the payment of the anti-dumping duties in force against China.

As regards the start date of the assembly operations, the information from the applicant as well as publicly available information, showed that the construction of small rolls production facilities in Thailand started in 2016 and 2017, and for 1 company in 2018, indicating the assembly operations started after the initiation of the anti-dumping investigation.

Undermining the remedial effect of the measures and dumping

To examine if the effects of the existing measures were undermined in terms of the prices and/or quantities, the Commission used the export prices and volumes reported by Eurostat. The investigation showed that average export prices were below the normal value from the last expiry review, demonstrating the existence of dumping. Furthermore, after comparing the non-injurious price from the 2019 expiry review investigation with the weighted average export CIF prices, (adjusted to include conventional customs duties and post clearance costs) the Commission found underselling of 29%. The Commission also found that the quantities exported were significant, representing almost 14% of the total volume of imports of small rolls during the reporting period. As a result, the Commission concluded that the existing measures were being undermined by the imports of small rolls from Thailand.

Extension of the measures

Based on the findings, the Commission concluded that the anti-dumping duty imposed on imports of small rolls originating China were being circumvented by imports from Thailand. Therefore, on 15 September 2021, the Commission extended the ‘all others’ rate of 35,6% applicable to imports from China to imports of the product under investigation consigned from Thailand.

3.2.6.    “Other” reviews (reinvestigations, or re-openings)

These investigations fall outside Article 11(3) or Article 19 of the basic Regulations and focus on the implementation of court rulings. In 2020, the Commission concluded 4 such investigations by amending the measures as appropriate. A list of the cases concerned is given in Annex H. More information can be obtained from the Official Journal publications to which reference is given in that Annex.

3.3.    Safeguard investigations

Safeguard measures have always been and remain an instrument that the Commission would only apply in truly exceptional circumstances. Indeed, they are only used where it is clear that, applying the highest standards, such measures are necessary and justified because, due to unforeseen circumstances, there has been a surge in imports and this has caused or threatens to cause serious damage to the EU industry. The Commission expects the EU’s commercial partners to follow a similarly strict approach.

Not all safeguard measures adopted by the EU constitute safeguards within the meaning of the WTO Agreement on Safeguards. Some of these measures are called ‘safeguards’ under particular regimes, such as bilateral safeguards or the safeguard investigations under the Generalised Scheme of Preferences (GSP).

On 14 March 2019, an EU Horizontal Bilateral Safeguard Regulation entered in force, 23 with the aim to streamline the implementation of the EU’s bilateral safeguard measures. The objective of these safeguard clauses is to temporarily suspend tariff preferences where preferential imports increase to such an extent that they cause or threaten to cause serious injury to a particular EU industry. This horizontal regulation provides standard rules for the implementation of bilateral safeguard clauses, including the conditions and decision-making process. In the past, the EU adopted separate regulations for each individual FTA, which will no longer be necessary.

In terms of casework, in 2021, the EU concluded two review investigations of its safeguard measure on certain steel products (Annex L).

3.3.1.     Details on individual safeguard cases

Safeguard measures on certain steel products – Prolongation review 

On 15 January 2021, the Commission received a substantiated request by twelve EU Member States to examine, pursuant to Article 19 of Regulation (EU) 2015/478 of the European Parliament and of the Council and Article 16 of Regulation (EU) 2015/755, whether the existing safeguard measure should be prolonged.

The Commission considered that the request contained sufficient evidence to initiate an expiry/prolongation review investigation. Accordingly, it published a Notice of Initiation (‘the Notice of Initiation’) in the Official Journal of the European Union on 26 February 2021.

In order to carry out a proper assessment as to whether the safeguard measure continues to be necessary to prevent or remedy serious injury, whether the Union steel industry was adjusting, and whether such prolongation was in line with the wider Union interest, the Commission collected specific data from the Union industry by means of questionnaires. These data included, inter alia, the evolution of key economic and financial indicators for the product concerned during the period 2018-2020 (‘the period considered’), as well as evidence that the industry is adjusting. The Commission also sought the position of other interested parties on a potential prolongation. To this end, the Notice of Initiation invited interested parties to participate in the investigation by submitting their observations and supporting evidence.

Legal requirements

Necessity

The investigation confirmed that during the period of application of the safeguard measure the economic situation of the Union industry continued worsening because of import pressure during a period where the important adjustments made by the Union industry had not yet produced positive effects. The Commission found that the Union steel industry, after the first three years of the safeguard measure, still finds itself in a fragile economic situation. The Commission also found that imports from the main steel exporting countries have exerted and still continue exerting very high import pressure on the Union’s steel market, with a an aggressive and opportunistic pattern of commercial behaviour, that is to say, using any margin to increase market presence. Furthermore, given the prevailing downward trends in worldwide exports and domestic consumption by the main steel exporting countries over the period considered, which were already underway prior to the COVID-19 pandemic, and in an overall context of significant overcapacity, the Commission then noted that exporters were in need to increase their sales on any possible market to continue operating.

The investigation also confirmed that other significant steel markets, including the second largest importing country, the US, continued having trade restrictions in place affecting the ability of exporting countries to sell thereto, in a general context of continuous decline in steel consumption. The investigation further confirmed that the Union market was comparatively more attractive for imports in terms of size and price levels, thereby becoming a market where large volumes of steel could be directed. The counterfactual analysis undertaken to determine what would happen if the safeguard was removed clearly showed a high likelihood that very substantial volumes of steel unsold in other parts of the world could end up being directed towards in the Union market. These additional imports, together with the currently existing ones, would overall lead to a very serious further deterioration of the economic situation of the Union industry, and could seriously endanger its viability. It was therefore established that the lapsing of the safeguard measure would result in serious injury to the Union industry caused by increased imports. This conclusion was not affected by the effects of the COVID-19 pandemic on the Union industry. Whilst the economic situation of the Union industry was further, aggravated in 2020 because of the COVID-19 pandemic, the Commission established that the likely increase in imports should the safeguard measure lapse would result in serious injury to the Union industry.

The Commission concluded that such increased volumes could undermine significantly any meaningful economic recovery and the efforts being made by the Union steel industry in its process of adjustment to a higher level of imports, which are described in the following section. Therefore, the Commission considered that the safeguard measure continued to be necessary to prevent serious injury. This necessity existed also because the Union did not have the possibility under WTO rules to increase import duties on the product concerned without taking a safeguard measure. Indeed, in the WTO the Union has bound its import tariffs at the level of zero for the tariff lines included in the product concerned. For this reason, just as in 2018 the increase in imports evidently was the result of the effect of these obligations (namely zero-duty tariff concessions) incurred by the Union under the GATT, so would these obligations also now permit imports to increase again, resulting in serious injury to the Union industry, should the safeguard lapse.

Adjustments by the Union industry

The Commission concluded that the EU steel industry was and would continue adjusting to a situation of higher imports during the application of the safeguard. In this regard, the Commission identified in the implementing regulation a large number of adjustments undertaken, or being undertaken by the Union industry.

Union interest

The Commission established that the legal requirements of necessity and adjustment required to prolong a safeguard measure were met. Furthermore, the Commission had also found that a removal of the safeguard measure was liable to cause a sudden import wave that will severely worsen the current still fragile financial situation of the Union steel industry. Such removal would jeopardise the Union industry’s recovery, just when the Union and world economy and trade are rebounding after the COVID-19 pandemic recession, and had not yet returned to pre-pandemic conditions. This import shock, in turn, risked negating the adjustment efforts the Union steel industry is making to adapt to stronger import pressure coming from market dynamics seriously distorted by increasing global overcapacity, and State intervention. Moreover, the Commission had also found that the steel prices increases recently observed on the Union steel market could not be imputable to, or be the result of, the Union steel safeguard because similar such high prices also prevail on worldwide markets and large volumes of free-of-duty TRQs remained nevertheless unused available under the safeguard. In this regard, the Commission also noted that, less than a month and a half to reach the end of the third year of the measure, around 11 million tonnes of free-of-duty TRQ remained unused, this is, 36 % of the total TRQ available. Thus showing that users, across product categories, had had the possibility to source sufficient free-of-duty steel from multiple sources, and that the safeguard measure had not unduly limited effective supply, neither in terms of volume, nor in terms of origins. In sum, the Commission found that the downsides of letting the safeguard lapse on 30 June 2021 would clearly outweigh any potential benefits its termination could bring about.

Therefore, the investigation concluded that the prolongation of the measure was necessary to prevent or remedy serious injury, that the EU steel industry was adjusting and that the prolongation was not against the overall Union interest.

Length of prolongation and level of liberalisation

In order to prevent that the Union industry suffered an undue serious injury if the safeguard measure lapsed at this stage, the Commission considered it necessary to prolong the measure for three additional years until 30 June 2024. However, in order to guarantee that the prolongation remained limited to the strict minimum necessary, the prolongation will be subject to a review regime, which, among others, foresees a review to determine whether the safeguard should not be terminated by 30 June 2023 after two years of prolongation.

Lastly, regarding liberalisation, the Commission established that as the forecasts foresaw, pre-pandemic economic and trade conditions were not expected to be soundly re-established within the Union until the end of the first half of 2022, and in line with the growth rate predicted over the current trade flows trend, the Commission did not see any reasons to alter at this stage the liberalisation rate of 3% for the first year of prolongation.

3.4.    Verification activities

Based on Articles 16 and 26 of the respective basic AD and AS Regulations, in the course of investigations, the Commission normally carries out visits to examine the records of companies or associations with the aim of verifying the information provided during the proceedings. However, because of the continued COVID-19 outbreak, in 2021 the European Commission replaced nearly all verification visits by a Remote Cross-Checking (RCC) process by videoconference, as had been done in 2020. The Commission had published a  Notice 24 on the consequences of the COVID-19 outbreak on anti-dumping and anti-subsidy investigations in 2020. 

During 2021, the Commission trade defence services carried out 197 verifications by remote cross checking. This covered the data from 111 European companies and 86 companies from 8 countries outside the EU (Turkey, China, Korea, India, Russia, Indonesia, USA and Argentina). In addition, there were 12 on-spot verifications to European companies in October and November 2021 as travel restrictions started to ease. The total number of verifications in 2021 was 209 covering European producers, users of the subject product, foreign exporters and importers alike.

4.    Enforcement of anti-dumping/countervailing measures 

Globalisation of trade led to greater possibilities for circumventing or otherwise reducing the effectiveness of anti-dumping and countervailing measures. To address this problem, throughout 2021, the TDI services continued their follow-up activities aimed at ensuring that measures were effectively enforced. In the framework of an integrated approach measures were considered in all their forms – duties and undertakings – and synergy was sought between the TDI services and enforcement-oriented services (OLAF, DG TAXUD and customs authorities in Member States).

More information on the Commission’s enforcement focus can be found in the main body of the Report (hereafter the Annual Report) to which this Staff Working Document (SWD) is attached.

4.1.    Follow-up of measures

The follow-up activities concerning measures in force are centred on four main areas: (1) to pre-empt fraud, by defining risk-related areas, alerting customs authorities and assessing the feedback from customs and economic operators; (2) to monitor trade flows and market developments; (3) to improve the effectiveness with the appropriate instruments (new investigation, interim review, newcomer review, contact with national administrations) and (4) to react to irregular practices by enhancing the co-operation with enforcement-related services (OLAF and national customs) and by initiating anti-absorption or anti-circumvention investigations.

4.2.    Monitoring of undertakings 

Monitoring of undertakings forms part of the enforcement activities, given that undertakings are a form of AD or AS measures. The Commission accepts such undertakings if it is satisfied that they can effectively eliminate the injurious effects of dumping or subsidisation.

During 2021, over 10 price undertakings in force were scrutinised which showed that the exporting producers were complying in full. No price undertakings offered for the TDI cases concluded in 2021 were accepted as the applicants did not demonstrate, in particular, that the offer would eliminate injurious dumping. No offer was rejected on the grounds of inadequate social and environmental standards in the exporting country. More information is available in Annexes M and Q.

4.3.    OLAF activity

The Commission has developed a range of activities addressing prevention and detection of fraud, and this includes a close cooperation with the European Anti-Fraud Office (OLAF), through annual meetings, day-to-day contacts, or exchange of case information, via a special OLAF liaison officer within the Directorate–General for Trade.

By mutual agreement between the Commission and OLAF, the Commission provides OLAF with any information and evidence relating to possible cases of fraud, or any other illegal activity related to TDI. Circumvention of TDI measures can occur in the form of: false declaration of product origin; misclassification under product codes outside measures; assembly operations; channelling via companies with no or low duty rates or undervaluation of imported products.

The Commission and OLAF have been reacting whenever they had indications pointing to the possibility of the above situations, such as: 1/ when subsequent to the imposition of measures, a significant decrease in imports from the country concerned into the EU could be noted, which was entirely or partially offset by an increase in imports of: products from another third country, or products classified under a product code outside measures, or parts of the product which are not subject to measures; 2/ when subsequent to the imposition of measures, imports from the country concerned into the EU were coming from a company with a low or a zero duty at the expense of imports from a company with a higher duty; or 3/ when a low amount of duties was collected by Member States’ customs authorities.

Moreover, when the Commission received complaints from Union industry regarding the circumvention of measures, it has each time informed OLAF thereof. The Commission stayed also in regular contact on these matters with Member States’ customs authorities. In 2021, there was further an increase in cases where OLAF pointed to improprieties by Union based companies benefitting from exemptions from the duties applicable to certain bicycle parts. This led the Commission trade defence services to re-examine the situation of three companies.

Investigations by OLAF into the practices above are confidential. For that reason, it is not possible to give further information or statistics on the latter. Every year OLAF publishes a report presenting its activities of the previous year, as well as statistics of its investigative performance and examples of cases.

5.    Refunds  

Articles 11(8) and 21(1) of the basic Regulations allow importers to request the reimbursement of the relevant collected duties where it is shown that the dumping/subsidy margin, on the basis of which duties were paid, has been eliminated or reduced to a level below that of the duty in force.

38 new refund requests were submitted during 2021. At the end of that year, 5 refund investigations were still on-going, covering 77 requests. The Commission adopted one Implementing Decision rejecting refund requests.

More details on these decisions and on the status of refund investigations can be found at:

http://trade.ec.europa.eu/tdi/refunds.cfm?sta=1&en=20&page=1&c_order=number&c_order_dir=Down  

6.    Information and Communication activities / Bilateral contacts

Explaining the legislation and practice of the EU's trade defence activity and exchanging views on third country practices continues to be an important part of the work of the TDI services.

In 2021, Korea resumed the traditional forum on trade defence to exchange best practices in the area. This year’s event took place on-line on 25 November. The focus of the event titled  ‘World Trade Environment and the Roles of Trade Remedy Authorities’ was to continue a dialogue on how, in today’s difficult and changing trade environment, trade remedy authorities can contribute to safeguard the shared values of free and fair trade. Under this chapeau, the participants touched upon varied subjects such as: flexibilities put in place for virtual and hybrid procedures even beyond COVID (Canada), possible conflicts of TDI with anti-trust law (Japan), or, how to deal with circumvention (US and India). The EU outlined the challenges it faces (COVID with unstable trade environment and proliferation of subsidies to address COVID-related hardship, disruption of the global supply chains, subsidies to address climate change and requests for reshoring linked to supply chain difficulties). As a solution the EU emphasised that all trade remedy authorities should apply the existing rules as a priority, stressing the principles of separating and distinguishing causes of injury, and respecting the principles of benefits and specificity to ensure government neutrality.

7.    Judicial review: decisions given by the Court of Justice and the General Court

7.1.        Overview of the judicial reviews in 2021

In 2021, the General Court (GC) and the Court of Justice (CJ) rendered 21 judgments and orders in the areas of application of anti-dumping or anti-subsidy measures: 14 rulings were handed down by the GC, whereas the CJ issued three judgments in appeals of a GC rulings and four preliminary rulings.

7.2. Cases pending

At the end of 2021, 61 cases were pending before the GC and 14 before the CJ. A list of the cases is given in Annex S.

7.3. New cases

In 2021, 18 new court cases were lodged in the field of trade defence. 12 of these were lodged before the GC (all actions for annulment) and six appeals before the CJ.

7.4 Judgements rendered by the General Court (a selection)

T‑45/19 Acron PAO

On 5 May 2021, the General Court (“GC”) dismissed the action introduced by Acron PAO 25 and its related trader (‘Acron’ or ‘the applicants’) for the annulment of Commission Implementing Decision 2018/1703 terminating the partial interim review concerning imports of ammonium nitrate originating in Russia. In the contested decision, the Commission considered that the conditions, which are necessary for the level of measures to be modified, in particular that there were lasting changes, were not met and therefore terminated the review without modifying the level of measures.

Acron claimed that the Commission erred in concluding that the change of circumstances on which it relied was not of a lasting nature. Acron noted that the Commission limited the interim review to only two out of six circumstances of a lasting nature put forward by the applicants in their request. The GC confirmed that the Commission has a broad margin of discretion in determining whether there is sufficient evidence in a request for an interim review to establish the need for such a review. The burden of proof is on the applicants who did not contest the Notice of initiation nor did they propose to enlarge its scope. The Commission was therefore right to initiate the interim review at issue solely on account of two alleged changes in circumstances relating, first, to the withdrawal of the undertaking, which would have led to a change in the group’s sales structure, and, second, to the alleged substantial increase in gas prices in Russia.

With regard to the alleged increase in the prices of natural gas as one of the possible changes of lasting nature, Acron claimed that the prices of natural gas in Russia experienced significant growth since the last calculation of its dumping margin in 2008. The GC focused on the question whether the prices of natural gas in Russia reasonably reflect a price normally charged on undistorted markets. The GC then confirmed that the applicants have not been able to adduce relevant and duly documented evidence to demonstrate that prices in Russia reflect prices normally charged on undistorted markets and that that difference between domestic and export prices of gas had been reduced in such a way that it could constitute a lasting change of circumstances. Consequently, the GC rejected the applicants’ claim that the Commission committed a manifest error when assessing alleged increase in gas prices in Russia.

With regard to changes in the sales structure following the withdrawal of undertaking, the applicants claimed that all its sales to the Union were now made through its sales subsidiary in Switzerland. According to the applicants, this change in the sales structure resulted in a change of SG&A costs and in a change in the export price which plays an important role in the calculation of the dumping margin. Hence that fact alone, according to the applicants, justifies recalculating their dumping margin. The GC first clarified that the purpose of undertaking is to give entities an alternative to the imposition of anti-dumping duties in the same circumstances which justify the imposition of such duties. Therefore, the withdrawal of undertaking cannot, in itself, have any bearing on the circumstances which justified the imposition of an anti-dumping duty, except as regards the aspects which led to the withdrawal of the undertaking. The GC further held that the creation of Swiss subsidiary cannot in this case constitute a circumstance which could in itself influence dumping margin. In particular, the applicants have not shown how their reinforced undertaking on the European market influenced the factors which gave rise to the application of the anti-dumping duty, that is to say the comparison between the normal value and the export prices. A change in the sales structure may, in principle, be included in all the relevant and duly documented elements, enabling the Commission to assess the need to maintain or amend an anti-dumping measure. However, it is not sufficient to modify the sales structure in order to request a recalculation of an anti-dumping duty. The applicants were not in a position to provide other economic justifications for the change in the sales structure. In view of the above, the GC concluded that the Commission did not err in concluding that no significant and lasting change of circumstances within the meaning of Article 11(3) of the basic regulation has taken place.

Acron further claimed that the Commission failed to take account of Russia’s accession to the WTO as a factor of change and, in so doing, infringed its international WTO obligations, which constitutes ‘an infringement of the Treaty’. The GC found that the Commission did not breach the EU's WTO obligations as the question of compliance by Russia with the WTO did not, contrary to what is claimed by the Acron, form the subject of an assessment by the Commission. Indeed, the Commission did not conclude anywhere in the contested decision that 'Russia had not abided by its commitment with respect to its natural gas industry', nor did it state that 'Russia did not comply with the Protocol.

Lastly, Acron complained that the Commission failed to communicate to Acron the final calculation of the dumping margin and thereby breached its rights of defence and principle of legal certainty. The GC noted that given that the Commission concluded that there was no lasting change of circumstances regarding dumping, it was not necessary to establish a new dumping margin. If the institutions conclude that the change of circumstances on which the author of the review request relies is not lasting or that the circumstances concerning dumping have not changes significantly, they may refrain, in the review procedure, from precisely calculating dumping margin.

Case T-716/19 - Interpipe vs Commission

On 14 July 2021, the GC dismissed the action brought by Interpipe Niko Tube and Interpipe Nizhnedneprovsky Tube Rolling Plant (the ‘Applicants’) against Commission Implementing Regulation (EU) 2019/1295 amending Implementing Regulation (EU) 2018/1469 imposing a definitive antidumping duty on imports of certain seamless pipes and tubes, of iron or steel, originating in Russia and Ukraine, following a partial interim review (the ‘contested regulation’).

The Applicants challenged the determination of their normal value and specific adjustments made to their export prices to the EU. The two issues arose in the context of the complex sales channels of the Interpipe group for both domestic sales and export sales, which involve related companies selling to the first independent customers.

First, the Applicants claimed that, when calculating the normal value, the Commission wrongly took into account the SG&A costs incurred on sales of the product concerned between the Applicants and its related company IPU, inflating the normal value both when applying the ordinary course of trade test, for the product types sold in Ukraine, and in constructing the normal value within the meaning of Article 2(3) of the basic regulation, for product types not sold in Ukraine. According to the Applicants the Commission thus breached Article 2(3), (4) and (6) of the basic Regulation, Article 2.2.2 of the WTO Anti-Dumping Agreement (the ‘WTO ADA’), and its own practice. Moreover, the Applicants argued that they did not actually incur the SG&A costs at issue, but rather that those costs were merely theoretical and provided only to comply with the reporting requirements from the Commission’s questionnaire.

The GC recalled that under Article 2(6) of the basic Regulation, SG&A costs must be based on data relating to the sales made in the ordinary course of trade (‘OCOT’). For the purpose of the OCOT test, the indirect sale must be taken into account as a whole. In order to establish whether such indirect sale is profitable, the Commission must verify whether the price charged by IPU enables it to recover the price that it paid to the Applicants and its SG&A costs. The GC therefore concluded that, if the Commission had not included the SG&A costs at issue in its calculation, it would have applied method of calculating the normal value which did not reflect the economic reality. With regard to the other arguments, the GC first pointed out that, since the WTO Appellate Body never ruled specifically on a situation such as that arising from indirect sales, it cannot be held that the Commission infringed Article 2(6) of the basic Regulation read in the light of Article 2.2.2 of the WTO ADA. Second, the GC reaffirmed that the lawfulness of a regulation imposing anti-dumping duties can only be assessed in light of the legal provisions, and not in light of alleged previous practice of the Commission or the Council. Finally, the GC confirmed that the information provided in response to the questionnaires (even as theoretical SG&A costs concerning the indirect sales) are essential to the operation of the AD procedure and the Commission must rely on information provided therein to establish its findings.

Second, the Applicants took issue with the fact that the Commission decided to stop treating IPE as an internal export sales department of the applicants, instead labelling it as an affiliated trader that sells the product concerned on a commission basis. This entailed making a downward adjustment to the export price charged by the IPE, pursuant to Article 2(10)(i) of the basic Regulation. Article 2(10)(i) of the basic regulation provides that ‘commissions’ are one of ‘the factors for which adjustment can be made’ to ensure a fair comparison between the export price and the normal value.

The GC recalled in that regard that when considering performing an adjustment for commissions pursuant to Article 2(10)(i) it is crucial to consider the economic reality of the relationship between the producer and the related trader. This includes taking account of all factors relevant to the determination as to whether or not that distributor carries out the functions of an integrated sales department within that producer. Taking into account the fact that IPCT did not exist as a distribution channel at the time of the previous interim review, as well as other confidential material communicated to the Applicants, the Commission considered that the adjustment should be applied. The GC found that given that several related entities were performing at least partially identical sales functions, the Commission was justified in maintaining that those entities could not be considered as an internal sales department.

The Applicants further submitted that the Commission infringed the obligation from Article 11(9) of the basic regulation to apply the same methodology in the review proceedings since in the previous reviews it did not take into account the SG&A costs at issue nor did it make the adjustment under Article 2(10)(i).

The GC noted that the Commission applied the adjustment under Article 2(10)(i) on the basis of facts which it had not previously examined or from which it had not drawn any legal conclusions. In any event, changes in the structure of a group and in the organization of its export sales to the EU represent a change in circumstances in the sense of Article 11(9), allowing for a change in methodology.

Finally, the Applicants claimed a breach of their rights of defence, since the Commission only communicated to them the new arguments on inclusion of SG&A costs at issue and the adjustment under Article 2(10)(i) in the letter of 2 August 2019, the same day as the publication of the contested regulation in the Official Journal.

The GC noted that the letter did not contain any factual or legal material previously unknown to the Applicants or on which they were unable to express their views. Moreover, the GC rejected all the additional arguments the Applicants have raised. Thus, it was not shown that the Applicants’ arguments could have affected the outcome of the investigation, have they been raised earlier.

7.5 Judgements rendered by the Court of Justice (a selection)

C‑56/19 P RFA International LP V Commission

On 10 February 2021, the Court of Justice dismissed the appeal against the judgement in case T-113/15 concerning a rejection of applications for a refund of anti-dumping duties. The appeal was lodged by RFA International (‘RFA’), a Canadian trader related to two ferro-silicon producers from Russia.

In the underlying investigation, the Commission rejected the refund applications because it established that the anti-dumping duty was not duly reflected in resale prices of RFA to the Union. In particular, the Commission found that the resale prices did not cover all the costs, including the anti-dumping duty. RFA challenged this finding arguing in essence that the Commission infringed Article 11(9) and (10) of the basic regulation by using a different methodology than the one used in the previous refund for assessing whether the anti-dumping duty is duly reflected in resale prices without that being justified by a change in circumstances. Article 11(9) of the basic regulation requires the Commission to use the same methodology in all review or refund investigations as in the as in the investigation which led to the duty, provided that circumstances have not changed. Article 11(10) of the basic regulation provides for the possibility of not deducting anti-dumping duties from the constructed export price if ‘conclusive evidence’ is presented by the applicant for a refund, demonstrating that those duties are duly reflected in the resale prices and subsequent selling prices in the European Union.

The GC dismissed the action and concluded that when assessing whether the anti-dumping duty is duly reflected in the resales prices the Commission was justified to take into account also the production costs as opposed to only comparing resale prices between the original and refund investigation period. According to the GC, given that the production costs have increased significantly since the original investigation period, a change in methodology was justified. In the appeal, RFA claimed that the GC failed its obligation to state reason by failing to address the argument relating to the absence of a change in circumstances. The Court of Justice rejected the claim stating that the fact that RFA disagrees with the analysis carried out by the GC cannot establish a failure to state reason.

RFA further argued that GC erred in law in the interpretation of Article 11(9) of the basic regulation claiming in essence that there was no change in circumstances capable of justifying the abandonment of the methodology previously used in the present case. RFA argued in particular that the change found by the GC, associated with the increase in ferro-silicon production costs in Russia by more than 100% since the original investigation period, existed and was already known to the Commission at the time of the previous refund investigation carried out between 2008 and 2010.

The Court of Justice found that GC erred in law in finding that there had been a change of circumstances in relation to what has been done in the context of an earlier investigation. However, the Court of Justice found that the operative part of the judgement under appeal can be seen to be well founded on other grounds. Therefore, the infringement by the GC is not capable of leading to the annulment of the judgement.

According to the Court of Justice, a 'mere updating of the parameter relating to the production costs' cannot be regarded as a change of methodology within the meaning of Article 11(9) of the basic regulation. The Court of Justice thus endorsed the Commission’s practice with regard to duty as cost, which consists of a two-step approach: the first step is limited to a comparison of resale prices from the refund investigation with the resale prices during the original investigation period. The second step might be required if, like in the present case, the resale prices have changed due to external factors such as a change in export costs, an increase or decrease in raw materials cost or price fluctuations due to seasonality. This second step consists in ensuring that all the production costs and the anti-dumping duties are included in the resales prices. If other factors have influenced the resale price, those other factors need to be distinguished from the potential impact of the anti-dumping duty in order to determine if such duty is indeed reflected in the resale price.

By the second part of that ground of appeal, RFA took issue with the burden of proof imposed on it and criticised among others the General Court for finding that, proof of the incorporation of the anti-dumping duties in the export prices could be adduced only by means of data relating to the ‘delivered duty paid’ prices. The Court of Justice held that RFA’s argument is based on a misinterpretation of the judgment under appeal. The Court of Justice further clarified that, contrary to what is claimed by the appellant, Article 11(10) of the basic regulation places the burden of proof on the party applying for the refund. The Commission is required to carry out only an examination of the content of the evidence provided by that party, and of the verifications underlying that examination, in order to determine whether that party has proved satisfactorily and conclusively that the anti-dumping duty was duly reflected in the resale prices in the European Union. Furthermore, it must be held that, by referring to the adjective ‘conclusive’ in Article 11(10) of the basic regulation, the EU legislature intended to impose, under that provision, an even higher standard of burden of proof than that generally laid down under the basic regulation.

Joined Cases C-884/19 P and C-888/19 P Commission v Xinyi PV Products (Anhui) and GMB Glasmanufaktur Brandenburg

On 2 December 2021 the Court of Justice set aside the judgment of the General Court (‘GC’) of 24 September 2019 Xinyi PV Products (Anhui) Holdings v commission (T-586/14) and referred the case back to the GC for a new ruling on the cases.

The cases concerned the application and interpretation of Article 2(7)(c) of Council Regulation (EC) No 1225/2009 of 30 November 2009 (‘the former basic regulation’) which set out the conditions for producers based in non-market economy countries to claim that market economy conditions prevail for them (‘MET claim’) and therefore their normal value should be established according to the standard methodology and not according to the “analogue country method” 26 .

In this case, Xinyi PV (a Chinese producer) saw its request for MET rejected by the Commission on the ground that the company had not provided sufficient evidence that its productions costs and financial situation are not subject to significant distortions carried over from the former non-market economy system in particular in relation to depreciation of assets, other write-offs, barter trade and payment via compensation of debts.

Following the action for annulment of Xinyi PV, the GC held that the Commission had made a manifest error in its assessment of the existence of significant distortion in production costs and in the financial situation of the firm.

In essence, the GC took into account the factors listed for the purposes of calculating the normal value in Article 2(1) to (6) of the former basic regulation and established a link between the significant distortion of the financial situation of the undertaking and the factors linked to the manufacture and sale of the like product concerned. It therefore interpreted the third indent of Article 2(7)(c) of the former basic regulation as meaning that the existence of a significant distortion of the overall financial situation of the producer concerned may lead to a rejection of a request for MET only if that distortion affects the production or sale of the like product concerned, which it is for the Commission to assess.

The Commission and GMB challenged this interpretation and argued that by making the possibility of rejecting a request for MET because of a significant distortion of the financial situation of the producer concerned subject to the finding that that distortion affects the manufacture and sale of the like product concerned, the GC conflated those cumulative and distinct subconditions. The GC’s interpretation rendered the reference to the significant distortion of the financial situation of the producer concerned irrelevant.

The Court of Justice considered that the GC interpretation was incorrect. First, as regards the literal interpretation the use of the conjunction ‘and’ implies that it is for the producer to establish that there is no significant distortion of its production cost and also that there is no significant distortion of its financial situation. Consequently, MET cannot be granted if either of the subconditions is not met.

Second, the GC erred in establishing a close link between Article 2(7)(c) and Article 2(1) to (6) of the former basic regulation. The Court of Justice held that by making the application of Article 2(7)(c) of the former basic regulation subject to an analysis of the producer aimed at ascertaining whether that producer operates in accordance with principles enabling normal value to be calculated according to the standard methodology, the GC misconstrued the general scheme of those provisions.

The Court of Justice also criticised the GC for reversing the burden of proof and imposing on the Commission the burden of establishing that a significant distortion of the financial situation of the producer concerned affects the production or sale of the like product concerned.

In addition, the Court of Justice also rejected the plea of Xinyi PV that criticised the Commission for having found that the tax incentives from which it benefited constituted distortions carried over from the former non-market economy system. The Court held that the connection of a measure consisting in granting tax incentives to foreign investments in sectors considered strategic, such as the high-technology sector, with various five-year plans implemented in China is sufficient for it to be presumed that that measure constitutes a distortion ‘carried over from the former non-market economy system’ within the meaning of that provision.

8.    Activities by third countries targeting the EU

This section describes the main developments and trends in the area of third country actions in 2021 (see also the Annual Report, as well as annex U (A - F) below for detailed figures).

This section describes the main developments and trends in the area of third country actions in 2021(see also the Annual Report, as well as annex U (A - F) below for detailed figures).

In 2021, the main users of the trade defence instruments against EU exports were the US with 38 measures in force, China with 19, Turkey with 17, and Brazil, Canada and India with 12 cases each, followed by Indonesia with 11.

Besides these main users, other important cases in countries that use the instruments less frequently are also described below in this section.

United States

Overall trends

In 2021, the US launched no new trade defence investigations affecting EU exports. This is in stark contrast to 2020 when the US were the country that launched the highest number of investigations affecting the EU (8).

At the end of 2021, the US had 38 measures in force affecting EU imports. In the course of 2021, one measure was terminated (pressure sensitive plastic tape) and seven new measures were imposed of which 6 AD and 1 AS (common alloy aluminium sheet, forged steel fluid end blocks (AD and AS), methionine, pre-stressed concrete steel wire strand, thermal paper, wind towers).

Main cases

Fluid end blocks AD and AS

On 28 January 2021, the US Department of Commerce (DOC) imposed definitive AD and AS measures on imports of fluid end blocks from Germany and Italy. The US found that the EU Emission Trading System (ETS) and the EU Research Fund for Coal and Steel are countervailable subsidy schemes. The EU export value concerned was EUR 67 million. AD measures range from 0% to 71% and AS measures from 3% to 45%. The Commission coordinated its efforts with the German and Italian authorities and intervened as appropriate during the investigation as well as at high political level, in order to avoid the measures. It will continue to intervene in order to convince the US to abandon the measures targeting the ETS, in line with the ongoing efforts to cooperate with the US in the fight against climate change.

Common alloy aluminium sheet AD

On 27 April 2021, the US DOC imposed AD measures on imports of common alloy aluminium sheets (CAAS) from six EU Member States: Germany, Spain, Italy, Slovenia, Romania and Croatia. The EU economic interest was EUR 520 million. AD measures range from 0% to 242.80%. Throughout the investigation the Commission has intervened in close cooperation with the EU industry, conveying in particular two concerns: (1) that such measures should be applied in a targeted way, whereas the US investigation covered a total of 18 countries representing almost all US imports, and (2) the excessively high level of AD duties as a result of ‘adverse facts available’ despite full cooperation of the exporters concerned.

Ripe olives AD and AS

On 8 December 2021, the US DOC launched the third administrative review of the countervailing duties against ripe olives from Spain. The US initially imposed these AS duties of up to 27 % and AD duties of up to 25.5% on 1 August 2018 and they have been in force since then. Preliminary results of this review are expected in September 2022 at the earliest. The EU economic interest in this case is EUR 67 million (before imposition of measures). The AS measures target support measures under the EU Common Agricultural Policy (CAP), which the EU considers as “green box”, i.e. they comply with the WTO Agreement on Agriculture. The Commission challenged these duties before the WTO and on 20 December 2021 the WTO Dispute Settlement Body adopted the final panel report declaring these duties inconsistent with WTO rules. The US expressed its intention to comply with the ruling and the Commission is engaging with the US to ensure the timely implementation of the panel ruling. Despite the favourable panel report, measures remain in place for the time being and companies and governments need to cooperate in the yearly reviews.

China

Overall trends

In 2021, China's Trade defence activity towards the EU continued to be rather limited. The total number of measures in force against the EU at the end of 2021 was 19, equal to 2020.

China did not initiate any new investigations in 2021 but imposed one new measure on meta-cresol from Belgium, Denmark, Germany, Spain, France, Ireland and Netherlands.

Turkey

Overall trends

At the end of 2021, Turkey had 17 measures in force that affected the EU, 12 AD and 5 SFG. 4 new investigations were initiated (3 AD: digital print foils, hot rolled steel and polyurethane artificial leather, the latter being an anti-circumvention investigation, and 1 SFG: grinding balls), which remains constant with 4 initiations in 2020.

There was 1 review of the SFG measure on wallpaper extended in July 2021 for additional 3 years, 1 new SFG measure, staple fibres, imposed in September 2021 for 3 years, and 1 new anti-circumvention measure, woven fabrics, imposed in August 2021 until January 2026.

Main cases

Wallpaper SFG

Review of the original SFG measure from 2015. This measure was already extended for 3 years in August 2018, including a TRQ that the EU successfully negotiated during consultations. The second review was initiated on 16 January 2021 and concluded on 15 July 2021 by extending the validity of the measure until 5 August 2024. Economic interest around EUR 13 million.

Staple Fibres SFG

The SFG investigation was initiated on 30 May 2020 and concluded on 24 September 2021 by imposing a specific duty of 0,06 USD/kg for 3 years (2nd period 0,058 and 3rd period 0,056). Economic interest: EUR 13 million.

Hot Rolled Steel AD

This investigation was initiated in January 2021, very soon after the imposition of measures by the EU on the same product, and it is still ongoing. The Commission intervened on several occasions in close cooperation with the EU industry. The investigation was extended and should be finalized by the end of June. Economic interest around EUR 820 million.

India

Overall trends

The total number of trade defence measures in force in 2021 has decreased as compared to 2020 (12 in 2021 against 15 in 2020), even though India remains one of the most frequent users of the instruments against the EU, after the US and China.

India has not initiated any SFG investigation last year, but has launched 2 new AD investigations in 2021 (4 in 2020) against the EU. The 2 new cases concern imports of melamine and rubber chemicals.

With regard to actions taken, India did not impose any duties in 2021 and has extended a temporary suspension of definitive AD duties imposed in 2019 (high-speed steel from Germany) for 12 months.

Main cases

Rubber Chemicals AD

The AD investigation was initiated in March 2021, targeting imports originating in or exported from 3 countries, among which the EU (EU economic interest of around EUR 17 million). The product concerned is certain rubber chemicals (TDQ, CBS, PVI). The Commission intervened during the oral hearing and has filed written submissions. At the time of writing this report, final findings have not been issued and definitive measures have not yet been introduced.

Indonesia

Overall trends

Indonesia is one of the most frequent users of SFG investigations in the world, regularly resorting to using SFG, rather than AD or AS.

In 2021, Indonesia had increased the number of SFG measures in force to 11 (as compared to 9 in 2020).

Up until recently in most of these investigations, the EU economic interest was negligible or limited. However, the situation has changed with the SFG investigation particularly on articles of apparel and clothing accessories and cigarette paper, (EU exports amounted to around EUR 82 million for the 2 products). In 2021, Indonesia initiated 2 SFG reviews (ceramic tiles and other alloy steel). The Commission actively intervened in all these cases, including at political level.

Main cases

Articles of apparel and clothing accessories SFG

The SFG investigation was initiated in October 2020 (EU exports EUR 76 million). The Commission filed several written submissions and has requested consultations in order to avoid or reduce the very high duties proposed by Indonesia. In November 2021, the SFG measures were nonetheless imposed, though at a level around 45% lower than initially recommended by the Indonesian authorities.

Cigarette paper SFG

In October 2020, the Indonesian authorities initiated an investigation on imports of cigarette paper (EU economic interest around EUR 6 million). The Commission provided written comments and has requested consultations to avoid or decrease the duties originally proposed. The measures finally imposed in December 2021 were more than 50% lower and for a shorter duration (2 years, instead of 3) than initially recommended.

Gulf Cooperation Council – GCC countries

Overall trends

At the end of 2021 there were 1 AD measure (uncoated paper or paperboard in rolls or sheets) and 1 SFG measure chemical plasticisers) in force.

Traditionally not a frequent user, in 2021, the GCC was very active and initiated 3 new AD investigations. The Commission actively intervened in all these cases, including at political level, and in various bilateral fora.

Main cases

Certain steel products SFG

On 2 September 2021, the GCC decided not to impose definitive SFG measures on imports of certain steel products. This investigation was initiated in October 2019. There were several rounds of written submissions made by the Commission and several hearings took place (EU economic interest more than EUR 100 million).

Electric accumulators AD

In April 2021 an AD investigation against imports of electric accumulators (vehicle batteries), inter alia, from Spain, was initiated (export value around EUR 36 million). We intervened in close cooperation with the EU industry. At the time of writing this report, the authorities have recommended to exclude Spanish imports from the scope of the investigation, as its dumping margin was less than 2%, de minimis.

Semi-chemical fluting paper AD

In August 2021, an AD investigation on imports of semi-chemical fluting paper from Germany and France was initiated (export value around EUR 29 million). We intervened in cooperation with the industry and continue to closely monitor.

Ukraine

Overall trends

In 2021, 1 new SFG measure (fresh cut roses) was imposed, which brings the total number of measures in force at the end of 2021 to 5 (1 AD, rubber plugs and 4 SFG, sulphuric acid and oleum, polymeric materials, polyurethane foam, and fresh cut roses).

3 investigations were terminated (1 AD, aluminium ladders and 2 SFG, ceramic tiles and cables and wires).

The number of ongoing investigations by Ukraine remains considerably high. There were 4 new SFG investigations initiated in 2021 (sodium hypochlorite, PVC profiles, tricone drilling bits and certain types of cheese), which represents 100% increase in comparison to 2020. Furthermore, 1 new SFG investigation on ceramic tiles was terminated without measures. The Commission intervened in all these investigations. Moreover, the Commission intervened on several occasions at political level with the Ukrainian authorities in order to make them reconsider their extensive use of the SFG instrument.

Main cases

Fresh cut roses SFG    
Initiated in July 2020, 95% of EU exports come from the Netherlands. The Commission made a written submission and held several rounds of consultations in order to avoid the very high duty of 139,7% or at least to reduce it. Following intense involvement of the Commission and the EU industry, the final measure of 56% was imposed on 21 April 2021 for 3 years (2nd period 44,8%% and 3rd period 35,48%), thus considerably reducing the originally proposed level of duty (EU Economic interest: EUR 3 million).

Aluminium ladders AD

This AD investigation was initiated on 1 September 2021 and concerns imports from Slovakia and Poland. Following the EU submission, this case was terminated on 8 December 2021. (EU economic interest: EUR 20 million).

Ceramic tiles SFG

The investigation was initiated on 1 June 2021. The EU industry and several Member States were very active in this case. The Commission also filed a submission. The case was terminated on 23 July 2021 (EU economic interest: EUR 76 million).

Cables and wires SFG

This case was initiated on 28 July 2020. The Commission participated in a hearing and a round of consultations in April 2021. Despite the original announcement to terminate this investigation in spring 2021, the intention to impose measures was communicated in September 2021. The Commission contested the late notification (more than 4 months after the foreseen end of the investigation according to UA law) by an additional submission in September 2021, following which the investigation was terminated (EU Economic interest: EUR 20 million).

Eurasian Economic Union (EAEU)

Overall trends

The EAEU did not initiate any new investigation against the EU, nor did it impose any new measure. There is currently 1 AD measure in force (herbicides).

Canada

Overall trends

In 2021, Canada has increased the number of measures imposed against the EU. At the end of 2021, Canada had 12 measures in force against the EU, 2 more than 2020. In terms of new investigations, Canada initiated 2 AD investigations (certain oil country tubular goods and small power transformers, both originating in Austria). In 3 cases, Canada imposed provisional measures. Canada also initiated a combined AD/AS interim review investigation on imports of refined sugar from the EU.

Main cases

Interim review investigation on refined sugar AD and AS

On 6 August 2021, Canada initiated a combined AD (DE, NL, UK, BE) and AS (EU) re-investigation to recalculate subsidy amounts and dumping duties. Measures are in place since 1995. EU exports since the imposition of measures were very low and in 2019 amounted to EUR 3 million.

The Commission has cooperated in the investigations. Regarding the AS investigation, the Commission has submitted evidence showing that there have been significant changes in the EU sugar market since the previous review, in particular, the sugar regime ended in 2017.

Wheat gluten AD

The investigation was initiated in August 2020, with an export value of around EUR 11 million. Member States concerned FR, BE, DE, LT, AT. The Canadian industry linked the increase of imports to the provisional entry into force of the CETA agreement on 21 September 2017, which is an element not linked to dumping. Canada also assessed whether there was a particular market situation in the EU market of wheat gluten. The Commission made three different submissions and replied to the questionnaire. It also participated in a hearing. In the end, Canada found that there was no particular market situation in the EU market of wheat gluten but decided to impose AD duties in April 2021.

Egypt

Overall trends

At the end of 2021, there were 2 SFG measures in force (raw aluminium and iron/steel bars and rods/ semi-finished products of iron/non-alloy steel).

Main cases

Edam and Gouda cheese SFG

The investigation was initiated on 29 December 2020 against imports of Edam and Gouda cheese from the Netherlands. Economic interest around EUR 30 million. Definitive measures were imposed on 10 January 2022, for a period of five years. The Commission made several written submissions, in close contact with the Dutch authorities, to coordinate our interventions.

Morocco

Overall trends

Morocco continues to be a moderate user of the instruments. At the end of 2021 a total of 6 measures are in force against EU exports (1 AD and 5 SFG).

During 2021, Morocco initiated 1 new SFG investigation (lighting columns) and reviewed 2 SFG measures in force (cold-rolled steel sheets, bars and wire rods).

Main cases

Lighting columns SFG

The investigation was initiated on 23 April 2021. EU export value: EUR 49 million. The Commission made a submission at initiation. The European industry has cooperated and some Member States intervened very actively since the very beginning. On 16 September 2021, the Moroccan authorities announced the application of a provisional SFG measure consisting of an ad valorem duty of 25% for a period of 200 days. It is still not clear when the measure will enter into force.

Wire rod and rebar SFG expiry review

In August 2021, Morocco initiated a third expiry review of the SFG measure on imports of wire rod and rebar. The Commission made a submission in cooperation with the EU industry. The investigation was finalised in December 2021 with the prolongation of measures as of 1 January 2022 until 15 October 2023.

Cold rolled steel sheets and plated or coated sheets SFG expiry review

In August 2021, Morocco initiated a second expiry review of the SFG measure on imports of cold-rolled steel sheets and plated or coated sheets. The Commission made a submission (no cooperation from the industry). On 21 December 2021, Morocco notified the extension of the SFG measure as of 1 January 2022 for 3 years, i.e. until 31 December 2024. The SFG measure consists of an additional ad valorem duty of 13,75% applicable to imports of cold-rolled steel sheets and plated or coated sheets exceeding a fixed quota of 36 000 tonnes.

South Africa

Overall trends

At the of 2021 there are 6 measures in force - 3 AD (2 measures on frozen chicken and 1 measure on ropes and cables) and 4 SFG (bolts, frozen chicken (bilateral SFG), screws and threaded fasteners).

2 new AD investigations were initiated in 2021 (frozen chicken and frozen potato chips) thus remaining constant with 2 investigations initiated in 2020. Moreover, South Africa imposed 1 new SFG measure (on the aforementioned bolts) like in 2020. 1 SFG investigation (structural steel) was terminated. South Africa also imposed 1 provisional AD measure on frozen chicken

Main cases

Structural steel SFG

The investigation was initiated in June 2020. The investigating authority recommended terminating this investigation in January 2021. Following the comments by the interested parties on this recommendation, this case was indeed terminated on 17 September 2021. Economic interest EUR 9 million.

Bolts SFG

The SFG investigation was initiated on 15 May 2020. Despite several interventions through written submissions upon initiation and essential facts, provisional measures were imposed on 13 November 2020. The definitive duty of 31,08% came into effect as of 10 December 2021 for a duration of 3 years (2nd period 30,8% and 3rd period 29,8%). Economic interest around EUR 16 million.

Frozen Chicken AD and bilateral SFG

An expiry review of the AD measure was initiated in March 2020 and concluded in August 2021, upholding the original duty levels imposed on imports from the Netherlands and Germany. The Commission has been heavily contesting the circumstances of the review, but also of the original investigation through numerous interventions on technical and political level, including comments on initiation, essential facts and final report.

In parallel, the bilateral dispute settlement proceeding on frozen chicken is still ongoing. Bilateral SFG measures were originally imposed in 2018 for a duration of 3,5 years, with a decreasing ad valorem duty (from 35% to 15%). Following several attempts to find an amicable solution, dispute settlement was requested by the EU, which has been advancing very slowly due to the unresponsiveness of South Africa. A panel was finally established in late 2021. It will issue the final report most likely after the lapse of the duties, foreseen on 11 March 2022.

In addition, a ‘new’ frozen poultry AD investigation was initiated on 24 February 2021. The Commission has intervened in all appropriate fora in support of the already heavily hampered frozen poultry sector. Despite a number of interventions, preliminary measures were imposed in December 2021. Final measures, if any, are expected in spring 2022. The EU economic interest is valued at around EUR 100 million.

Pasta AD

This case was initiated on 18 September 2020 and concerned Latvia and Lithuania. Despite several interventions on technical and political level, measures between 3 and 73% were imposed on 23 August 2021. Other countries concerned: Egypt and Turkey. EU economic interest: EUR 8 million.

Other important cases

AD cases on EU exports of frozen fries

In 2021, there were four on-going AD investigations against exports of frozen fries from different EU countries. The combined value of EU exports covered by these investigations was close to EUR 150 million. The investigating countries were Colombia, New Zealand, South Africa and Brazil. In 2021, Colombia continued with the expiry review initiated in 2020, with very few developments. In August 2021, South Africa terminated the expiry review of measures imposed in 2016 without duties, but initiated a new investigation in November. New Zealand also terminated an AD investigation without measures. Brazil concluded a review of the product scope of the measures imposed in 2017 without the extension of measures to other types of frozen fries. The Commission intervened strongly in all the above cases in close cooperation with the EU industry and Member States affected. As a result, exporters can continue to export to South Africa without duties for the time being and Brazilian measures were not extended to other product types. Finally, the WTO dispute settlement proceeding against Colombia frozen fries is still ongoing. The Panel report is expected by summer 2022.

Commission’s successful interventions

Examples of successful Commission interventions are listed below.

In October 2019, the Gulf Cooperation Council (GCC) initiated a SFG investigation regarding imports of certain steel products. The Commission, in close cooperation with the European industry and Member States concerned were very active throughout the whole investigation. There were several rounds of written submissions made by the Commission and several hearings took place. In February 2021, the Essential Facts Report was circulated, which determined that the criteria for imposition of measures were met. The Commission presented again a series of comments in particular in relation to the proposed enlargement of the product scope.

Finally, on 2 September 2021, the GCC Ministerial Committee did not approve the Permanent Committee’s proposal for the imposition of definitive SFG measures and the investigation was terminated.

The Commission persuasively intervened in one AD and two SFG investigations conducted by Ukraine on imports of aluminium ladders, ceramic tiles, cables and wires. The Commission has repeatedly insisted that measures would not be compatible with WTO rules. These actions led to the termination of all these investigations by the Ukrainian authorities without imposition of any measures allowing for a market, of a combined export value of EUR 116 million, not to be closed.

The Commission, together with the EU industry and Member States, also successfully intervened to obtain a lower level of SFG duty on exports of fresh cut roses to Ukraine (from initially 139,7% to 56%) after consultations held with the Ukrainian authorities. Economic interest is EUR 3 million.

9.    Activities in the framework of the WTO

9.1Dispute settlement in the field of trade defence 

The WTO procedure for the settlement of disputes between WTO Members concerning the application of the WTO agreements is divided into two main stages.

The first stage consists of bilateral consultations between the WTO Members concerned. If those consultations fail to settle the dispute, the second stage can be opened by requesting the WTO Dispute Settlement Body to establish a panel.

WTO Members, other than the complaining and defending parties, with an interest in a given dispute, can intervene as 'third parties' before the panel.

The panel issues a report, which must be adopted by the WTO Dispute Settlement Body (DSB) in order to become binding between the parties to the dispute. In a fully functioning WTO dispute settlement system (see further below), panel reports first can be appealed before the WTO Appellate Body (AB) (each appeal being heard by three members of a permanent seven-member body set up by the Dispute Settlement Understanding (DSU)).

Both the panel report and the report by the AB are adopted by the Dispute Settlement Body (DSB) unless the DSB rejects the report by unanimity. The findings of a panel report or an AB report have to be implemented by the WTO Member whose measures have been found to be inconsistent with the relevant WTO Agreements.

If the complaining WTO Member is not satisfied with the way the reports are implemented, it can ask for the establishment of a so-called 'implementation panel'. Here too, an appeal against the findings of the panel is possible.

Anti-dumping, anti-subsidy and safeguards measures are among the most common subject matters in WTO dispute settlement. The EU is an active participant actively in WTO dispute settlement proceedings as a third party in relation to TDI.

Regarding the procedures described above, it should be noted that, since 11 December 2019, due to the blockage of new appointments to the AB, the WTO dispute settlement system is not able to function fully, because there are no members on the Appellate Body. This affects the capacity of the WTO dispute settlement system to deliver binding resolutions of trade disputes and undermines rules-based international trade.

The EU has been tireless in its efforts to find, together with the WTO Membership, a lasting solution to this situation. Pending such a solution, the EU, together with certain other WTO Members, built a workaround arrangement to apply as long as the appointments to the AB remain blocked. Known as the ‘MPIA’, the Multi-party interim appeal arbitration arrangement allows its participating WTO Members to bring appeals and solve disputes within the framework of the DSU despite the current paralysis of the AB. It achieves this through the conclusion of agreements between participating WTO Members to have appeals in disputes between them dealt with by way of arbitration within the framework of the DSU. In this way, the MPIA provides a functioning, binding, two-tier and independent dispute settlement system in the disputes that it covers. It mirrors the usual WTO appeal rules and, for as long as the AB remains unable to function fully, can be used between any Members of the WTO that join the MPIA. 

The MPIA shows that participating WTO Members value and are willing to take concrete action to preserve an independent dispute settlement system with an appeal function. The MPIA will apply until a lasting solution to the AB situation is found. Finding that solution remains the EU’s priority. The world needs a properly functioning, multilateral, rules-based global trading system, with a functioning dispute settlement system at its core.

DS494: European Union – Cost Adjustment Methodologies and Certain Anti-Dumping Measures on Imports from Russia

On 24 July 2020, the panel circulated to all WTO Members its final report in DS494 European Union – Cost Adjustment Methodologies and Certain Anti-Dumping Measures on Imports from Russia. Both parties appealed the report.

However, with the ongoing difficulties in the WTO Dispute Settlement, there was no progress in 2021.

DS521: European Union — Anti-Dumping Measures on Certain Cold-Rolled Flat Steel Products from Russia

The case dates back to January 2017, when the Russian Federation requested consultations with the European Union concerning anti-dumping measures imposed by the European Union on imports of certain cold-rolled flat steel products from the Russian Federation. Consultations with Russia took place on 8 June 2017. Almost two years later, on 13 March 2019, the Russian Federation requested the establishment of a panel. The panel was established on 16 March 2020. Written procedure took place during the summer 2020 whereas the first substantive meeting planned for the autumn was postponed due to COVID-19 related travel restrictions.   

There was no progress on this case during 2021 as Russia continued to postpone during the year.

9.2    Meetings of the WTO Anti-dumping, ASCM and Safeguards Committees. 

The twice-yearly meetings of the Subsidies and Countervailing, Anti-dumping and Safeguards Committees were held in April and October 2021, again in virtual format. The Anti-dumping Working Group on Implementation also met virtually in October 2021.

The Commission submitted the EU’s Subsidy notification to the WTO in July 2021. This exercise in transparency, which is due every second year, is crucial in understanding the level and impact of subsidies granted by WTO countries. Unfortunately, the track record on members making timely and complete notifications has been poor. The Commission continued in 2021 to urge members to meet their notification obligations.

In the AD Committee, the EU raised a number of third countries’ investigations of concern for EU Exporters. These included: a review investigation on imports of frozen chips / fries from Belgium and the Netherlands by the South African Customs Union (SACU); a review of measures on refined sugar from Denmark, the Netherlands, UK and Belgium by Canada and the preliminary AD duties on imports on common alloy aluminium sheet originating in seven EU Member States by the US.

In the ASCM Committee, under the now regular agenda item on the role of subsidies as a contributor to excess capacity, discussion took place on the role of below market financing in contributing to overcapacities. There was also an exchange on the harmful impact of overcapacities on the environment as well as loss to investment in R & D by competing industries.

During the WTO Safeguard Committee meetings in April and October 2021, the EU raised a number of concerns regarding the following investigations: Indonesia: Articles of apparel and clothing accessories, Morocco: hot rolled steel, wire rods and reinforcing bars, cold rolled sheets, lighting columns, South Africa: steel screws with hexagon heads, Turkey: polyester staple fibres,  and Ukraine: sodium hypochlorite, PVC profiles. The EU also defended its position concerning the safeguard measures on certain steel products, which were subject to criticism from India, China, Russia, Japan, Switzerland and Korea.

10.    Audit of the European Court of Auditors

During 2021, the Commission continued implementing the recommendations of the European Court of Auditors contained in the report of the audit on the EU’s Trade defence policy, published in July 2020 . The report, which concluded that the Commission successfully enforces the EU’s trade defence policy, proposed six recommendations for trade defence investigations, as follows;

(I)better document how review of confidentiality issues was carried-out;

(II) to seek additional communication channels with stakeholders to raise awareness of trade defence instruments;

(III)to provide further guidance to in questionnaires to interested parties, as well as to investigators on how to analyse relevant competition issues raised by parties;

(IV) to stipulate criteria for identifying trade defence measures with the highest risk of circumvention, as well as to carry regular evaluations to estimate the overall effectiveness of trade defence measures;

(V)to use its powers of initiating ex-officio investigations more fully, including by specifying the criteria to initiate an investigation for new products ex-officio and by acting swiftly where conditions are met for an ex-officio initiation and

(VI)to prioritise its response to third-country measures more effectively, in particularly by defining specific criteria for its response.

The Commission had accepted all the recommendations, except for recommendation (v) relating to ex-officio investigations which the Commission accepted partially. This is because the Commission considered its practice with respect to ex-officio investigations to be fully in line with the applicable legislation.

As far as the implementation of the recommendations in 2021 is concerned;

(I)The Commission developed an IT based solution to document the confidentiality assessments of the documents that will become operational in 2022.

(II)Covid related restrictions delayed full implementation of the second recommendation. A seven module information package explaining the purpose, application and relevance of the trade defence instruments for SMEs was developed. This was placed on-line in early 2022 and will be disseminated through Member States and relevant stakeholders.

(III)As regards competition aspects in trade defence, the Commission developed guidance for stakeholders/interested parties as well as for case-handlers on how to address competition issues in investigations. This will be implemented in cases from early 2022.

(IV)The Commission, already committed to enforcement, developed a new policy on monitoring based on a detailed mapping of systemic risk factors associated with trade defence measures. The risk factors, together with a standardised scoring system, forms the basis for objective prioritisation of monitoring activities as from the end of 2021. Channels for exchanging risk information with associated Commission services (such as OLAF, DG TAXUD and DG BUDG) as well as Member States' customs administrations and the Union industry, were further developed.

(V)As regards ex-officio investigations, while not accepting the recommendation fully as explained above, the Commission nevertheless set out on its website, more information regarding such investigations in order to address certain misconceptions and provide additional guidance for the European industry.

(VI)In 2021, the Commission established criteria to identify third country trade defence cases that present the most important economic, systemic and political interest, as well as the level of cooperation by European exporters.

The recommendations also included an evaluation of the effectiveness of trade defence instruments which is to be done in 2023.

11.    Export transparency and authorisation scheme for COVID-19 vaccines and their active substances 

On 29 January 2021, the Commission decided on a temporary export authorisation regime, pursuant to Article 5 of Regulation (EU) 2015/479, for COVID-19 vaccines covered by Advanced Purchase Agreements (APA) with the Union to ensure adequate supplies in the Union to meet the vital demand 27 . Under this scheme, export authorisations had to be requested for exports of COVID-19 vaccines and their active substances during a period of six weeks. With Regulation (EU) 2021/442 this scheme was prolonged until 30 June 2021.

In March 2021, the principles of reciprocity and proportionality were introduced as new criteria to be considered for authorising exports in Regulation (EU) 2021/521. This Regulation also suspended the exempted export destinations, except the EU’s overseas countries and territories, and some small states in Europe with a particular dependency on the metropolitan supply chains of the Member States to which they are attached to. Initially, this Regulation was valid for 6 weeks. This period was extended by Regulation (EU) 2021/734 and the list of exempted export destinations was further broadened to include the EFTA countries. Due to the continuing need for transparency and security of supply, the export authorisation scheme, together with the principles of reciprocity and proportionality was prolonged twice until 31 December 2021. On 26 November 2021, the Commission announced that it would replace the transparency and authorisation scheme with an export monitoring system on the same products from 1 January 2022 onwards 28 .. 

LIST OF ANNEXES

ANNEX A

ANNEX B

ANNEX C

ANNEX D

ANNEX E

ANNEX F

ANNEX G

ANNEX H

ANNEX I

ANNEX J

ANNEX K

ANNEX L

ANNEX M

ANNEX N

ANNEX O