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24.5.2012 Official
Journal
of
the
European
Union L
134/31
COMMISSION DECISION
of 23 May 2012
terminating the anti-subsidy proceeding concerning imports of certain stainless steel fasteners and
parts thereof originating in India
(2012/278/EU)
THE EUROPEAN COMMISSION,
(5) The
Commission
continued
to
seek
and
verify
all
information it deemed necessary for its definitive
findings. The oral and written comments submitted by
Having regard to the Treaty on the Functioning of the European
the interested parties were considered and, where appro
Union,
priate, the provisional findings were modified accord
ingly.
Having regard to Council Regulation (EC) No 597/2009 of
11 June 2009 on protection against subsidised imports from
countries not members of the European Community ( 1 ) (‘the
(6) Subsequently,
all
parties
were
informed
of
the
essential
basic Regulation’), and in particular Article 14 thereof,
facts and considerations on the basis of which it was
intended to terminate the anti-subsidy proceeding
concerning imports of certain stainless steel fasteners
After consulting the Advisory Committee,
and parts thereof originating in India and to release the
amounts secured by way of the provisional duty (‘final
disclosure’). All parties were granted a period within
Whereas:
which they could make comments on this final
disclosure.
1. PROCEDURE
1.1. Provisional measures
2. PRODUCT CONCERNED AND LIKE PRODUCT
(1) The
European
Commission
(‘the
Commission’),
by
Regu
(7) After
final
disclosure,
one
party
reiterated
its
comments
lation (EU) No 115/2012 ( 2 ) (‘the provisional Regu
regarding the definition of the product concerned and
lation’), imposed a provisional countervailing duty on
the like product provided in recitals 22 and 23 of the
imports of certain stainless steel fasteners and parts
provisional Regulation claiming that certain product
thereof originating in India (‘India’ or ‘the country
types should be excluded from the product scope of
concerned’).
this investigation.
(2) The
proceeding
was
initiated
on
13
May
2011
( 3 ),
following a complaint lodged on 31 March 2011 by
(8) However, the investigation has confirmed that the
the European Industrial Fasteners Institute (EIFI) (‘the
different product types are covered by the description
complainant’), on behalf of producers representing
of the product concerned and like product and share
more than 25 % of total Union production of certain
the same basic physical, chemical and technical character
stainless steel fasteners and parts thereof.
istics and end uses and therefore belong to the same
product category. Therefore, this claim was rejected.
(3) As
set
out
in
recital
21
of
the
provisional
Regulation,
the
investigation of subsidy and injury covered the period
(9) In the absence of other comments concerning the
from 1 April 2010 to 31 March 2011 (‘the investigation
product concerned and the like product, recitals 22 and
period’ or ‘IP’). The examination of trends relevant for the
23 of the provisional Regulation are hereby confirmed.
assessment of injury covered the period from 1 January
2008 to the end of the IP (‘the period considered’).
3. SUBSIDISATION
1.2. Subsequent procedure
3.1. Introduction
(4)
Subsequent to the disclosure of the essential facts and
considerations on the basis of which it was decided to
(10) In
recital
24
of
the
provisional
Regulation,
reference
was
impose provisional countervailing measures (‘provisional
made to the following schemes, which allegedly involve
disclosure’), several interested parties made written
the granting of subsidies:
submissions making known their views on the
provisional findings. The parties who so requested were
granted an opportunity to be heard.
(a) Duty Entitlement Passbook Scheme (DEPBS);
( 1 ) OJ L 188, 18.7.2009, p. 93.
( 2 ) OJ L 38, 11.2.2012, p. 6.
( 3 ) OJ C 142, 13.5.2011, p. 36.
(b) Advance Authorisation Scheme (AAS);

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L 134/32
EN
Official Journal of the European Union
24.5.2012
(c) Export Promotion Capital Goods Scheme (EPCGS);
entire production of goods or services may be set up
under the EOUS. In return, companies enjoying this
EOU status are entitled to a number of concessions
listed under recital 71 of the provisional Regulation.
(d) Export Oriented Units Scheme (EOUS);
These concessions are financial contributions of the
Government of India (GOI) within the meaning of
Article 3(1)(a)(ii) of the basic Regulation and they
(e) Focus Product Scheme (FPS);
confer a benefit upon the EOUs. They are contingent
in law upon export performance, and therefore deemed
to be specific and countervailable under Article 4(4), first
paragraph, point (a) of the basic Regulation.
(f) Export Credit Scheme (ECS);
(g) Electricity Duty Exemption.
(16) In the provisional Regulation it was stated that the EOUS
could not be considered as a permissible duty drawback
system or substitution drawback system within the
meaning of Article 3(1)(a)(ii) of the basic Regulation as
(11) The
Union
industry
questioned
whether
the
Commission
it did conform to the strict rules laid down in Annex I
failed to take into account a number of subsidy schemes,
(items (h) and (i)), Annex II (definition and rules for
and as a result believed that the subsidies found to be
drawback) and Annex III (definition and rules for substi
received by Indian producers were underestimated.
tution drawback) to the basic Regulation. Indeed, it could
not be established that the GOI has a verification system
or procedure in place to confirm whether and in what
(12) In
reply
to
this,
it
should
be
noted
that
the
complaint
amounts duty and/or sales tax-free procured inputs were
contained a great number of national and local subsidy
consumed in the production of the exported product (see
schemes, which were included in the questionnaire to
Annex II(II)(4) to the basic Regulation and, in the case of
exporting producers in India and investigated by the
substitution drawback schemes, Annex III(II)(2) to the
Commission. However, only for the schemes listed in
basic Regulation). The verification system in place aims
recital 10 above, it was found that the investigated
at monitoring the NFE earning obligation and not the
exporting producers in the sample had received subsidies.
consumption of imports in relation to the production of
exported goods.
(13) In
the
absence
of
any
other
comments,
recitals
24
to
27
of the provisional Regulation are hereby confirmed.
(17) Subsequent
to
the
provisional
disclosure,
no
substantive
arguments were raised against the nature of the EOUS, as
described above, in particular the absence of an effective
verification system and its countervailability. Therefore,
(14) No
comments
were
received
on
the
findings
regarding
FPS and on the Electricity Duty Exemption. As regards
the conclusions on the EOUS, as summarised in recitals
DEPBS, AAS, EPCGS and ECS, the cooperating exporting
78-81 of the provisional Regulation, are herewith
producers provided detailed comments. Most of these
confirmed.
comments related to the calculation of the subsidy
amounts and certain comments resulted in slight
adjustments to those calculations. However, the overall
3.2.2. Submission of Viraj Profiles Limited
conclusions on these schemes were not affected by such
comments and are herewith confirmed. Comments were
(18) The
sole
sampled
party
with
an
EOU
status
was
Viraj
also received on the EOUS. Taking account of the impact
Profiles Limited (‘Viraj’). The EOU subsidy rate established
of such comments on the EOUS, as summarised below in
for this producer at the provisional stage was 2,73 % out
recitals 13 to 19, there is no need to reproduce in detail
of a total subsidy rate of 3,2 %. Viraj represented, in
the other comments received on the abovementioned
volume, 87 % of Indian exports to the Union.
four schemes.
3.2. Export oriented units scheme (EOUS)
(19) As
already
mentioned
in
recital
77
of
the
provisional
Regulation, Viraj submitted detailed comments on the
3.2.1. General
scheme. The exporting producer concerned claimed that
the subsidy calculated under the scheme would not be
(15) It should be recalled that, as also mentioned under
compliant with Article 15(1) of the basic Regulation,
Section 3.5 of the provisional Regulation, a crucial
according to which the amount of the countervailable
obligation of an Export Oriented Unit (EOU) as set out
duty shall not exceed the amount of countervailable
in the Foreign Trade (FT)-policy 2009-2014 is to achieve
subsidies actually received by the company. It claimed
net foreign exchange (NFE) earnings, which means that in
that, therefore, the overall subsidy rate for the
a reference period (five years) the total value of exports
company would be below 2 %, i.e. de minimis. The
has to be higher than the total value of imported goods.
company submitted detailed accounting data to support
In principle, all enterprises that undertake to export their
its claim.

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EN
24.5.2012 Official
Journal
of
the
European
Union L
134/33
(20) The claim was duly analysed. The detailed accounting
been submitted in December 2011 and was already
data provided by Viraj in its submissions could be
referred to in recital 77 of the provisional Regulation.
linked to the accounting data verified during the verifi
All aforementioned documents had been included in
cation visit and these data suggested that indeed the
the file for inspection by interested parties without
countervailable benefit received by the company during
delay. Viraj’s comments to the provisional disclosure
the investigation period had been overestimated.
merely summarised the position already taken in its
Therefore, the countervailing duty for Viraj has been
previous submissions. While the open version of Viraj’s
recalculated accordingly.
comments to the provisional disclosure was indeed filed
by Viraj at a late stage, it was promptly made available
by the Commission to the Union industry, which was
(21) Consequently,
the
EOUS
subsidy
rate
of
Viraj
was
recal
granted an additional time period to submit comments
culated and is definitely set at 0,44 %. Including the
thereon.
subsidy rates established for EPCGS (recalculated at
0,05 %), ECS (recalculated at 0,12 %) and Electricity
duty exemption (0,09 %), Viraj’s total subsidy rate was
(25) In
view
of
the
above
considerations,
the
claims
of
the
definitively established at 0,7 %, i.e. below the de minimis
Union industry had to be rejected.
threshold.
3.2.4. Other subsidy issues
3.2.3. Comments of the Union industry on the final disclosure
(26) Comments
were
also
received
on
the
calculation
of
the
(22) After final disclosure, Union industry submitted
subsidy margin for the cooperating non-sampled
comments arguing that the recalculations made in
exporting producers and the residual subsidy margin
relation to EUOS benefits received by Viraj were unjus
calculation. Moreover, the sole exporting producer
tified and incorrect. It argued that the Commission’s
which had claimed individual examination insisted that
analysis was incomplete, inconsistent with the way the
its request should be addressed. However, in view of the
Institutions usually countervail this scheme and that it
conclusions under causation below, it is not necessary to
failed to take into account other possible scenarios
take a final position on these matters.
where Viraj could have unduly disposed of the duty-
exempted imports. Furthermore, the Union industry
alleged that Viraj’s late submission of the non-
confidential comments on the provisional disclosure
4. UNION INDUSTRY
seriously prejudiced the Union industry’s right of defence.
(27) In the absence of comments concerning the Union
production and the Union industry recitals 120 to 123
of the provisional Regulation are hereby confirmed.
(23) With respect
to the recalculation of Viraj’s subsidy
margin, it should be clarified that this exporting
producer had demonstrated that the established
provisional countervailable duty was exceeding the
5. INJURY
amount of countervailable subsidies actually received.
Indeed, the company demonstrated that the potential
5.1. Preliminary remarks and Union consumption
duty foregone had provisionally been overestimated
and, therefore, this had to be corrected in the final calcu
(28) In the absence of comments concerning the preliminary
remarks and Union consumption, recitals 124 to 130 of
lation. It would have been against the provisions of
the provisional Regulation are hereby confirmed.
Article 3 of the basic Regulation to countervail certain
financial contributions which, clearly and beyond doubt,
cannot be considered to confer any benefit to Viraj.
However, it is still considered that, with regard to
5.2. Imports from the country concerned
certain transactions, the scheme has conferred specific
subsidies to the company concerned which should be
(29) One
party
claimed
that
the
provisional
analysis
of
the
countervailed. This approach, therefore, is fully consistent
development of import prices from India and price
with the way the Institutions have countervailed the
undercutting, based on average prices, was misleading,
scheme in the past. Accordingly, the revision of the
since allegedly it does not take into account the
EOUS subsidy margin is in full compliance with
variation of the product mix from one year to the
Article 15(1) of the basic Regulation.
other during the period considered.
(24) As to the alleged violation of the Union industry’s right
(30) In
this
respect,
it
is
worth
noting
that
data
on
prices
per
of defence, it should be noted that Viraj’s comments on
product type are only available for the IP, for which
the EOUS subsidy calculation were also included in two
exporting producers and Union producers are asked to
open submissions filed prior to the imposition of
provide a detailed transaction listing as part of their
provisional measures, as well as in two later open
questionnaire replies. Therefore, in the absence of data
submissions. The first and key submission in this
per product type for the other years within the period
regard, which led the Commission to analyse the issue
considered, a meaningful analysis of the development of
in-depth and, eventually to reconsider its position, had
import prices can only be made based on average prices.

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L 134/34
EN
Official Journal of the European Union
24.5.2012
It should also be noted that the party in question did not
5.3.4. Employment
provide any evidence to demonstrate why the analysis
regarding the development of import prices would be
(39) In the absence of comments concerning employment,
misleading. Therefore, this claim was rejected.
recitals 141 and 142 of the provisional Regulation are
hereby confirmed.
(31) As
regards
undercutting,
it
is
recalled
that
as
mentioned
in recital 134 of the provisional Regulation, in order to
5.3.5. Average unit prices in the Union
determine price undercutting during the IP, the weighted
average sales prices per product type of the sampled
(40) In the absence of comments concerning average unit
Union producers charged to unrelated customers on
prices in the Union, recitals 143 and 144 of the
the Union market, adjusted to an ex-works level, were
provisional Regulation are hereby confirmed.
compared to the corresponding weighted average prices
of the imports from India to the first independent
customer on the Union market, established on a CIF
5.3.6. Profitability, cash flow, investments, return on
basis, with appropriate adjustments for the existing
investments and ability to raise capital
customs duties and post-importation costs.
(41) In
the
absence
of
comments
concerning
profitability,
cash flow, investments, return on investments and
(32) Furthermore, as mentioned in recital 135 of the
ability to raise capital, recitals 145 to 148 of the
provisional Regulation, the price comparison was made
provisional Regulation are hereby confirmed.
on a type-by-type basis for transactions at the same level
of trade. Therefore, the claim of this party as regards
undercutting was rejected.
5.3.7. Stocks

(42) One
party
requested
the
Commission
to
provide
actual
(33) In the absence of any other comments concerning
figures with regard to the development of stock levels
imports from the country concerned, recitals 131 to
over the period considered instead of indexed figures,
135 of the provisional Regulation are hereby confirmed.
claiming that indexation did not allow it to make
effective comments or to assess the level of stocks as a
percentage of sales of the Union industry.
5.3. Economic situation of the Union industry
5.3.1. Production, production capacity and capacity utilisation
(43) For
reasons
of
confidentiality,
as
explained
in
recital
127
of the provisional Regulation, certain micro indicators,
(34) One party claimed that the analysis made in the
including stocks, had to be indexed. In any event, the
provisional Regulation concerning the decrease in the
indexation of closing stocks of the Union industry in
production of the Union industry was misleading and
table 10 of the provisional Regulation provides a
claimed that the decrease in production volumes should
reasonable understanding of the development of stocks
be seen in the light of unutilised capacity of the Union
during the period considered. Therefore this claim was
industry, which also showed a decreasing trend during
rejected.
the period considered.
(44) In
the
absence
of
other
comments
concerning
stocks,
(35) The
investigation
showed
that
the
decline
in
production
recital 149 of the provisional Regulation is hereby
coincided with the decrease in sales and the increase of
confirmed.
stocks. This situation led some Union producers to close
some of their production lines, which explains the
decrease in capacity utilisation. The claim of the party
5.3.8. Magnitude of the subsidy margin
was therefore rejected.
(45) It is recalled that the largest Indian exporting producer
representing 87 % of the Indian exports to the Union in
(36) In the absence of any other comments concerning
the IP was found not to be subsidised. Consequently
production, production capacity and capacity utilisation,
subsidised imports accounted for 13 % of the total
recitals 137 and 138 of the provisional Regulation are
volume of the product concerned exported from India
hereby confirmed.
to the Union. Given the volume, market share and prices
of the subsidised imports from India, the impact on the
5.3.2. Sales volume and market share
Union industry of the actual subsidy margins may be
considered to be negligible.
(37) In the absence of comments concerning the development
of sales volume and market share of the Union industry,
recital 139 of the provisional Regulation is hereby
5.3.9. Conclusion on injury
confirmed.
(46) The
investigation
confirmed
that
most
of
the
injury
indi
cators showed a declining trend during the period
5.3.3. Growth
considered. Therefore the conclusion reached in recitals
151 to 153 of the provisional Regulation that the Union
(38) In the absence of comments concerning growth, recital
industry suffered material injury within the meaning of
140 of the provisional Regulation is hereby confirmed.
Article 8(5) of the basic Regulation is confirmed.

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EN
24.5.2012 Official
Journal
of
the
European
Union L
134/35
6. CAUSATION
the IP, corresponding to a market share of 15 % in the
IP, as opposed to the market share of 2 % of the
6.1. Introduction
subsidised imports from India in the same period.
(47) In accordance with Articles 8(5) and Article 8(6) of the
basic Regulation, it was examined whether the subsidised
imports originating in India have caused injury to the
Union industry to a degree that enables it to be classified
(53) Prices
of
imports
from
India
decreased
overall
by
9
%
in
as material. Known factors other than the subsidised
the period considered, remaining always lower than
imports, which could at the same time be injuring the
import prices from the rest of the world and sales
Union industry, were also examined to ensure that
prices of the Union industry. However, it is noteworthy
possible injury caused by these other factors was not
that, as explained in recital (50), the average prices of the
attributed to the subsidised imports.
non-subsidised imports were found to undercut the
prices of the Union industry much more than those of
the subsidised imports.
(48) As
explained
in
recitals
18
to
21
above,
the
subsidy
margin of the largest Indian exporting producer,
6.3.2. Imports from other third countries
accounting for 87 % of all Indian exports to the Union
in the IP, was found to be de minimis for this individual
(54) In the absence of any comments concerning imports
exporting producer in the meaning of Article 14(5) of
from other third countries recitals 161 to 165 of the
the Basic Regulation, consequently considered as non-
provisional Regulation are hereby confirmed.
subsidised for the purpose of this investigation.
Therefore, only a mere 13 % of the Indian exports of
the product concerned to the Union during the IP were
subsidised. These subsidised imports had a market share
6.3.3. Economic crisis
of 2 % in the IP.
(55) In
the
absence
of
any
comments
concerning
the
impact
of the economic crisis on the injury suffered by the
Union industry, recitals 166 to 169 of the provisional
6.2. Effect of the subsidised imports
Regulation are hereby confirmed.
(49) The
investigation
showed
that
the
Union
consumption
increased by 9 % over the period considered, while
sales volume of the Union industry decreased by 14 %
6.3.4. Export performance of the sampled Union industry
and market share dropped by 21 %.
(56) In the absence of any comments concerning the export
performance of the sampled Union industry, recital 170
of the provisional Regulation is hereby confirmed.
(50) With regard to prices, the average import prices of the
subsidised imports were found to undercut the average
sales prices of the Union industry on the Union market.
However, they were around 12 % higher than the prices
6.4. Conclusion on causation
of the Indian company not found to be subsidised.
(57) The
above
analysis
demonstrated
that
over
the
period
considered there was a substantial increase in the
volume and market share of the low-priced imports orig
inating in India. It was also found that these imports
(51) Based on the above, it is considered that the limited
were constantly undercutting the prices charged by the
import volume of the subsidised imports from India,
Union industry on the Union market.
which had higher prices than the non-subsidised
imports, may only have played a very limited role, if
any, in the deterioration of the injurious situation of
the Union industry.
(58) However,
in
view
of
the
finding
that
exports
by
the
largest Indian exporting producer, which represented
87 % of the Indian exports to the Union in the IP,
were not subsidised, it is considered that a causal link
6.3. Effect of other factors
between the subsidised imports, accounting for a mere
13 % of the total quantity exported from India, and the
6.3.1. Non-subsidised imports from India
injury suffered by the Union industry cannot be suffi
ciently established. Indeed, it cannot be argued that the
(52) The total volume of imports from India increased
subsidised Indian exports, in view of their limited volume
dramatically by 65 % over the period considered,
and very limited market share (2 %) and the fact that
increasing their market share from 12,1 % to 18,3 %.
their prices were on average 12 % higher than those of
However, as explained above, non-subsidised imports
the non-subsidised imports, would be causing the injury
represented 87 % of the total Indian export volume in
suffered by the Union industry.

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L 134/36
EN
Official Journal of the European Union
24.5.2012
(59) The
analysis
of
the
other
known
factors,
which
could
HAS ADOPTED THIS DECISION:
have caused injury to the Union industry, including the
non-subsidised imports, imports from other third coun
Article 1
tries, the economic crisis and the export performance of
The anti-subsidy proceeding concerning imports of certain
the sampled Union industry showed that the injury
stainless steel fasteners and parts thereof, currently falling
suffered by the Union industry is due to the impact of
within CN codes 7318 12 10, 7318 14 10, 7318 15 30,
the non-subsidised imports from India which represented
7318 15 51, 7318 15 61 and 7318 15 70, originating in
87 % of all Indian exports to the Union in the IP and
India, is hereby terminated.
which were made at significantly lower prices than the
subsidised imports.
Article 2
Amounts secured by way of provisional countervailing duties
pursuant to Regulation (EU) No 115/2012 on imports of
7. TERMINATION OF THE ANTI-SUBSIDY PROCEEDING
certain stainless steel fasteners and parts thereof originating in
India shall be released.
(60) In
the
absence
of
a
material
causal
link
between
the
subsidised imports and the injury suffered by the
Article 3
Union industry, it is considered that countervailing
measures are unnecessary and therefore the present
This Decision shall enter into force on the day following its
anti-subsidy proceeding should be terminated in
publication in the Official Journal of the European Union.
accordance with Article 14(2) of the basic Regulation.
Done at Brussels, 23 May 2012.
(61) The
complainant
and
all
other
interested
parties
were
informed accordingly and were given the opportunity
For the Commission
to comment. The comments received did not alter the
conclusion that the present anti-subsidy proceeding
The President
should be terminated,
José Manuel BARROSO

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