52003PC0106

Proposal for a COUNCIL REGULATION terminating the anti-dumping proceeding concerning imports of unwrought unalloyed magnesium originating in the People's Republic of China

(presented by the Commission)

EXPLANATORY MEMORANDUM

In November 1998, a definitive anti-dumping duty was imposed on imports of unwrought unalloyed magnesium originating in the People's Republic of China.

In June 2002, a partial interim review pursuant to Article 11(3) of Council Regulation (EC) No 384/96 was initiated, which was limited in scope to the appropriateness of the definitive anti-dumping duties imposed.

On 18 June 2002, the complainant informed the Commission that the sole Community producer of the product concerned ceased its production and formally withdrew its complaint. The Commission, therefore, published a notice in view of the repeal of the anti-dumping measures. None of the interested parties objected.

Therefore, it is proposed to approve the termination of the present anti-dumping proceeding and the repealing of the existing anti-dumping measures and to publish the attached Council Regulation in the Official Journal of the European Union.

Proposal for a COUNCIL REGULATION terminating the anti-dumping proceeding concerning imports of unwrought unalloyed magnesium originating in the People's Republic of China

THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty establishing the European Community,

Having regard to Council Regulation (EC) No 384/96 of 22 December 1995 on protection against dumped imports from countries not members of the European Community [1], and in particular Article 9 and 11 thereof,

[1] OJ L 56, 6.3.1996, p.1 as last amended by Regulation (EC) 1972/2002 (OJ L 305, 7.11.2002, p.1)

Having regard to the proposal submitted by the Commission [2] after consulting the Advisory Committee,

[2] OJ C [...] du [...]

Whereas:

A. PROCEDURE

(1) In November 1998, the Council by Regulation (EC) No 2402/98 [3] imposed definitive antidumping duties on unwrought unalloyed magnesium originating in the People's Republic of China.

[3] OJ L 298, 7.11.98, p. 1, as last amended by Regulation (EC) No 2788/2000 (OJ L 324, 21.12.2000, p. 4).

(2) These duties were imposed subsequent to an investigation further to a complaint lodged by the Comité de Liaison des Industries de Ferro-Alliages ("Euro Alliages" or the "complainant") on behalf of the sole Community producer of unwrought unalloyed magnesium ("the product concerned").

(3) In June 2002 a partial interim review [4] pursuant to Article 11(3) of Council Regulation (EC) No 384/96 of 22 December 1995 on protection against dumped imports from countries not members of the European Community (the "Basic Regulation") was initiated. The review was limited in scope to the appropriateness of the definitive anti-dumping duties imposed.

[4] OJ C 140, 13.6.2002, p.14

B. WITHDRAWAL OF THE COMPLAINT

(4) By a letter of 18 June 2002, the complainant formally withdrew its complaint. The complainant informed the Commission that the sole known Community producer of the product concerned had ceased its production, and declared that the measures appear no longer necessary.

(5) In accordance with Article 9(1) of the Basic Regulation, a proceeding may be terminated where the complaint is withdrawn, unless such termination would not be in the Community interest.

(6) In a notice published on 27 September 2002 [5] the Commission announced its intention to investigate whether the repeal of the measures is warranted. Interested parties were invited to make themselves known and provide the Commission with information together with supporting evidence. The Commission received 7 replies from the user industry supporting the repeal of the measures. Furthermore, the sole Community producer confirmed that the measures were no longer appropriate. In view of the above, the Commission informed the interested parties of its intention to propose to the Council to repeal the anti-dumping duty in force and to terminate the proceeding following the withdrawal of support. No further arguments were raised concerning the Community interest aspects. It is therefore considered that the termination of the proceeding would not be against the Community interest.

[5] OJ C 230, 27.9.2002, p. 2

(7) Certain parties requested the retroactive repeal of the measures arguing that there has been no basis for the imposition of the anti-dumping duties since the complainant formally withdrew its complaint.

(8) In this respect, it should be noted that the results of a review under Article 11 normally apply from the date of conclusion of such review. Indeed, it is established Community practice that anti-dumping duties remain in force as long as it is found that their termination (or modification) is warranted. Consequently, parties had no reason to legitimately expect that in the present case the existing measures would be repealed with a retroactive effect. It was considered that a consistent legal approach should be adopted in order to avoid an unstable and unforeseeable environment for economic operators in future. Additionally, the termination of the anti-dumping measure with retroactive effect would affect the unalloyed magnesium market in a discriminatory way. Those economic operators who purchased the merchandise from countries not subject to the anti-dumping duties would in case of retroactivity find that their prudence was not warranted. It was considered that operators who purchased in China would make a windfall profit, as anti-dumping duties would not be levied on imports made between the ceasing of production of the product concerned by the Community industry and the publication of this Regulation. For all the above reasons, the request for a retroactive termination had to be rejected.

(9) Given the above, it is concluded that the anti-dumping proceeding concerning unwrought unalloyed magnesium originating in the People's Republic of China should be terminated.

C. INTERIM REVIEW

(10) Given the above, the ongoing interim review investigation concerning the same anti-dumping measures should also be terminated.

HAS ADOPTED THIS REGULATION:

Article 1

The anti-dumping proceeding, including the review investigation of anti-dumping measures, concerning imports of unwrought unalloyed magnesium currently classifiable within CN codes 8104 11 00 and ex 8104 19 00 and originating in the People's Republic of China is hereby terminated.

Article 2

This Regulation shall enter into force on the day of its publication in the Official Journal of the European Union.

This Regulation shall be binding in its entirety and directly applicable in all Member States.

Done at Brussels,

For the Council

The President