HTML PUBLIC "-//W3C//DTD HTML 4.01 Transitional//EN"L 168/6
EN
Official Journal of the European Union
28.6.2012
COUNCIL IMPLEMENTING REGULATION (EU) No 559/2012
of 26 June 2012
terminating the partial interim review concerning the countervailing measures on imports of
certain polyethylene terephthalate (PET) originating in, inter alia, India
THE COUNCIL OF THE EUROPEAN UNION,
1.2. Existing anti-dumping measures
(3) By
Regulation
(EC)
No
2604/2000
( 7 ), the Council
imposed a definitive anti-dumping duty on imports of
Having regard to the Treaty on the Functioning of the European
PET originating, inter alia, in India. A review pursuant
Union,
to Article 11(4) of Council Regulation (EC)
No 1225/2009 ( 8 ) (‘the basic anti-dumping Regulation’)
concerning South Asian Petrochem Ltd was subsequently
conducted and its definitive findings and conclusions are
Having regard to Council Regulation (EC) No 597/2009 of
set out in Council Regulation (EC) No 1646/2005 ( 9 ).
11 June 2009 on protection against subsidised imports from
Following an expiry review, the Council, by Regulation
countries not members of the European Community ( 1 ) (‘the
(EC) No
192/2007
( 10 ), imposed a definitive anti-
basic Regulation’), and in particular Articles 19 and 24 thereof,
dumping duty for a further period of five years. The
anti-dumping measures were amended by Regulation
(EC) No 1286/2008 following a partial interim review
Having regard to the proposal submitted by the European
investigation. The measures were set at the level of the
Commission after consulting the Advisory Committee,
injury elimination and consisted of specific anti-dumping
duties. The rate of the duty is between EUR 87,5 and
EUR 200,9 per tonne for individually named Indian
producers with a residual duty rate of EUR 153,6 per
Whereas:
tonne imposed on imports from all other producers
(‘the current anti-dumping measures’).
1. PROCEDURE
(4) Following
a
name
change
of
one
Indian
company,
South
Asian Petrochem Ltd, by Notice 2010/C 335/06 ( 11 ), the
1.1. Previous investigation and existing counter
Commission concluded that the anti-dumping findings in
vailing measures
respect of South Asian Petrochem Ltd should apply to
Dhunseri Petrochem & Tea Limited.
(1) By
Regulation
(EC)
No
2603/2000
( 2 ), the Council
imposed a definitive countervailing duty on imports of
polyethylene terephthalate (PET) originating, inter alia, in
(5) By
Decision
2005/697/EC
( 12 ), the Commission accepted
India. The definitive findings and conclusions of an accel
undertakings offered by South Asian Petrochem Ltd
erated review pursuant to Article 20 of the basic Regu
setting a minimum import price (‘the undertaking’).
lation are set out in Council Regulation (EC)
Following a name change, the Commission concluded
No 1645/2005 ( 3 ). Following an expiry review, the
by Notice 2010/C 335/05 ( 13 ) that the undertaking
Council, by Regulation (EC) No 193/2007 ( 4 ), imposed
offered by South Asian Petrochem Ltd should apply to
a definitive countervailing duty for a further period of
Dhunseri Petrochem & Tea Limited.
five years. The countervailing measures were amended by
Council Regulation (EC) No 1286/2008 ( 5 ) following a
partial interim review (‘the last review investigation’).
1.3. Initiation of a partial interim review
The countervailing measures consist of a specific duty.
The rate of the duty is between EUR 0 and EUR 106,5
(6) A
request
for
a
partial
interim
review
pursuant
to
per tonne for individually named Indian producers with a
Article 19 of the basic Regulation was lodged by
residual duty rate of EUR 69,4 per tonne imposed on
Dhunseri Petrochem & Tea Limited, an Indian
imports from all other producers.
exporting producer of PET (‘the applicant’). The request
was limited in scope to subsidisation and to the
applicant. The applicant at the same time also
requested the review of the current anti-dumping
(2) Following
a
name
change
of
one
Indian
company,
South
measures. The residual anti-dumping and countervailing
Asian Petrochem Ltd, by Notice 2010/C 335/07 ( 6 ), the
duties are applicable to imports of products produced by
Commission concluded that the anti-subsidy findings in
the applicant and sales of the applicant to the Union are
respect of South Asian Petrochem Ltd should apply to
covered by the undertaking.
Dhunseri Petrochem & Tea Limited.
( 7 ) OJ L 301, 30.11.2000, p. 21.
( 1 ) OJ L 188, 18.7.2009, p. 93.
( 8 ) OJ L 343, 22.12.2009, p. 51.
( 2 ) OJ L 301, 30.11.2000, p. 1.
( 9 ) OJ L 266, 11.10.2005, p. 10.
( 3 ) OJ L 266, 11.10.2005, p. 1.
( 10 ) OJ L 59, 27.2.2007, p. 1.
( 4 ) OJ L 59, 27.2.2007, p. 34.
( 11 ) OJ C 335, 11.12.2010, p. 6.
( 5 ) OJ L 340, 19.12.2008, p. 1.
( 12 ) OJ L 266, 11.10.2005, p. 62.
( 6 ) OJ C 335, 11.12.2010, p. 7.
( 13 ) OJ C 335, 11.12.2010, p. 5.

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EN
28.6.2012 Official
Journal
of
the
European
Union L
168/7
(7) The
applicant
provided
prima
facie
evidence
that
the
interim review of the current anti-dumping measures
continued application of the measure at its current
pursuant to Article 11(3) of the basic anti-dumping
level was no longer necessary to offset the counter
Regulation, limited in scope to the examination of
vailable subsidisation. In particular, the applicant
dumping in respect of the applicant.
provided prima facie evidence showing that its subsidy
amount has decreased well below the duty rate currently
applicable to it. This reduction in the overall subsidy level
(15) In
the
parallel
anti-dumping
investigation
it
was
found
would mainly be due to the termination of its export
that the changes are not of a lasting nature. As a
oriented unit (EOU) status. With a magnitude of
consequence, the review investigation was terminated
13,5
%, the EOU scheme accounted for the vast
without amending the measures in force.
majority of the 13,9 % subsidies established during the
accelerated review.
2. PRODUCT CONCERNED AND LIKE PRODUCT
(8) Having
determined,
after
consulting
the
Advisory
Committee, that the request contained sufficient prima
2.1. Product concerned
facie evidence, the Commission announced on 2 April
2011 the initiation of a partial interim review (‘the
(16) The
product
under
review
is
PET
having
a
viscosity
of
present review’) pursuant to Article 19 of the basic Regu
78 ml/g or higher, according to the ISO Standard
lation by Notice 2011/C 102/08 (
1628-5, currently falling within CN code 3907 60 20

1 ). The review was
limited in scope to the examination of subsidisation in
and originating in India (‘the product concerned’).
respect of the applicant.
2.2. Like product
1.4. Parties concerned by the investigation
(17) The
investigation
revealed
that
the
product
concerned
(9) The
Commission
officially
informed
the
applicant,
the
produced in India and sold to the Union is identical in
representatives of the exporting country and the
terms of physical and chemical characteristics and uses to
association of Union producers about the initiation of
the product produced and sold on the domestic market
the review. Interested parties were given the opportunity
in India. It is therefore concluded that products sold on
to make their views known in writing and to request a
the domestic and export markets are like products within
hearing within the time limit set in the notice of initi
the meaning of Article 2(c) of the basic Regulation.
ation.
(10) One interested party requested and was granted a
3. RESULTS OF THE INVESTIGATION
hearing.
3.1. Subsidisation
(11) In
order
to
obtain
the
information
deemed
necessary
for
(18) On the basis of the information submitted by the GOI
its investigation, the Commission sent a questionnaire to
and the applicant and the replies to the Commission’s
the applicant and the Government of India (GOI) and
questionnaire, the following schemes, which allegedly
received replies within the deadline set for that purpose.
involve the granting of subsidies, were investigated:
(12) The
Commission
sought
and
verified
all
information
deemed necessary for the determination of subsidisation.
Nationwide schemes:
The Commission carried out verification visits at the
premises of the applicant in Kolkata, India and at the
premises of the GOI in New Delhi (Directorate-General
(a) Duty Entitlement Passbook Scheme (DEPBS);
of Foreign Trade and Ministry of Commerce) and Kolkata
(Commerce & Industries Department, Government of
West Bengal).
(b) Export oriented units (EOU)/export processing zones
(EPZ)/special economic zones (SEZ);
1.5. Review investigation period
(13) The
investigation
of
subsidisation
covered
the
period
(c) Export Promotion Capital Goods Scheme (EPCGS);
from 1 April 2010 to 31 March 2011 (‘the review inves
tigation period’ or ‘RIP’).
(d) Focus Market Scheme (FMS);
1.6. Parallel anti-dumping investigation
(14) On
2
April
2011
by
Notice
2011/C
102/09
( 2 ) the
Commission announced the initiation of a partial
(e) Export Credit Scheme (ECS);
( 1 ) OJ C 102, 2.4.2011, p. 15.
( 2 ) OJ C 102, 2.4.2011, p. 18.
(f) Income Tax Exemption Scheme (ITES).

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L 168/8
EN
Official Journal of the European Union
28.6.2012
Regional schemes:
during the RIP of the current investigation was 8 % of
fob value, subject to a value cap of INR 58/kg. As a
result, the maximum benefit is INR 4,64/kg.
(g) West Bengal Incentive Scheme (WBIS).
(26) To
be
eligible
for
benefits
under
this
scheme,
a
company
(19) The
schemes
(a)
to
(d)
specified
in
recital
18
are
based
on
must export. At the time of the export transaction, a
the Foreign Trade (Development and Regulation) Act
declaration must be made by the exporter to the auth
1992 (No 22 of 1992) which entered into force on
orities in India indicating that the export is taking place
7 August 1992 (‘Foreign Trade Act’). The Foreign Trade
under the DEPBS. In order for the goods to be exported,
Act authorises the GOI to issue notifications regarding
the Indian customs authorities issue, during the dispatch
the export and import policy. These are summarised in
procedure, an export shipping bill. This document shows,
Foreign Trade Policy (FTP) documents, which are issued
inter alia, the amount of DEPBS credit which is to be
by the Ministry of Commerce every five years and
granted for that export transaction. At the time of issuing
updated regularly. Two FTP documents are relevant to
the export shipping bill, the exporter knows the benefit it
the RIP of this case, i.e. FTP 04-09 and FTP 09-14.
will receive. Once the customs authorities issue an export
The latter entered into force in August 2009. In
shipping bill, the GOI has no discretion over the granting
addition, the GOI also sets out the procedures
of a DEPBS credit. The relevant DEPBS rate to calculate
governing FTP 04-09 and FTP 09-14 in a ‘Handbook
the benefit is that which applied at the time the export
of Procedures, Volume I’ (‘HOP I 04-09’ and ‘HOP I
declaration was made. Therefore, there is no possibility
09-14’ respectively). The Handbook of Procedures is
for a retroactive amendment to the level of the benefit.
also updated on a regular basis.
(20) Scheme
(e)
is
based
on
sections
21
and
35A
of
the
(27) It
was
found
that,
in
accordance
with
Indian
accounting
Banking Regulation Act 1949, which allows the
standards, DEPBS credits can be booked on an accrual
Reserve Bank of India (RBI) to direct commercial banks
basis as income in the commercial accounts, upon
in the field of export credits.
fulfilment of the export obligation. Such credits can be
used for payment of customs duties on subsequent
imports of any goods unrestrictedly importable, except
capital goods. Goods imported against such credits can
(21) Scheme (f) is based on the Income Tax Act of 1961,
be sold on the domestic market (subject to sales tax) or
which is amended by the yearly Finance Act.
used otherwise. DEPBS credits are freely transferable and
valid for a period of 24 months from the date of issue.
(22) Scheme (g) is administered by the Government of West
Bengal and set out in Government of West Bengal
Commerce & Industries Department notification
(28) Applications
for
DEPBS
credits
are
electronically
filed
and
No 580-CI/H of 22 June 1999, replaced by notification
can cover an unlimited amount of export transactions.
No 134-CI/O/Incentive/17/03/I of 24 March 2004.
De facto, no strict deadlines to apply for DEPBS credits
exist. The electronic system used to manage DEPBS does
not automatically exclude export transactions exceeding
3.2. Duty Entitlement Passbook Scheme (DEPBS)
the deadline submission periods mentioned in paragraph
4.47 of HOP I 04-09 and of HOP I 09-14. Furthermore,
(a) Legal Basis
as clearly provided in paragraph 9.3 of the HOP I 04-09
and of HOP I 09-14, applications received after the
(23) The detailed description of the DEPBS is contained in
expiry of submission deadlines can always be considered
paragraphs 4.3 of FTP 04-09 and FTP 09-14 as well as
with the imposition of a minor penalty fee (i.e. 10 % of
in chapter 4 of HOP I 04-09 and HOP I 09-14.
the entitlement).
(b) Eligibility
(29) It
was
found
that
the
applicant
used
this
scheme
during
the RIP.
(24) Any manufacturer-exporter or merchant-exporter is
eligible for this scheme.
(d) Conclusions on DEPBS
(c) Practical implementation of the DEPBS
(30) The
DEPBS
provides
subsidies
within
the
meaning
of
(25) An
eligible
exporter
can
apply
for
DEPBS
credits
which
point (1)(a)(ii) of Article 3 and point (2) of Article 3 of
are calculated as a percentage of the value of products
the basic Regulation. A DEPBS credit is a financial
exported under this scheme. Such DEPBS rates have been
contribution by the GOI, since the credit will eventually
established by the Indian authorities for most products,
be used to offset import duties, thus decreasing the GOI’s
including the product concerned. They are determined
duty revenue which would otherwise be due. In addition,
regardless of whether import duties have actually been
the DEPBS credit confers a benefit upon the exporter,
paid or not. The DEPBS rate for the product concerned
because it improves its liquidity.

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EN
28.6.2012 Official
Journal
of
the
European
Union L
168/9
(31) Furthermore, the DEPBS is contingent in law upon
(f) Calculation of the subsidy amount
export performance, and is therefore deemed to be
specific and countervailable under point (a) of the first
(36) In
accordance
with
point
(2)
of
Article
3
and
Article
5
of
subparagraph of Article 4(4) of the basic Regulation.
the basic Regulation, the amount of countervailable
subsidies was calculated in terms of the benefit
conferred on the recipient, which is found to exist
during the review investigation period. In this regard, it
(32) This
scheme
cannot
be
considered
as
permissible
duty
was considered that the benefit is conferred on the
drawback system or substitution drawback system
recipient at the point in time when an export transaction
within the meaning of point (1)(a)(ii) of Article 3 of
is made under this scheme. At this moment, the GOI is
the basic Regulation as claimed by the applicant. It
liable to forego the customs duties, which constitutes
does not conform to the strict rules laid down in
a financial contribution within the meaning of
point (i) of Annex I, in Annex II (definition and rules
point (1)(a)(ii) of Article 3 of the basic Regulation.
for drawback) and in Annex III (definition and rules for
substitution drawback) to the basic Regulation. An
exporter is under no obligation to actually consume
(37) In light of the above, it is considered appropriate to
the goods imported free of duty in the production
assess the benefit under the DEPBS as being the sum
process and the amount of credit is not calculated in
of the credits earned on all export transactions made
relation to actual inputs used. Moreover, there is no
under this scheme during the RIP.
system or procedure in place to confirm which inputs
are consumed in the production process of the exported
product or whether an excess payment of import duties
(38) Where justified claims were made, fees necessarily
occurred within the meaning of point (i) of Annex I and
incurred to obtain the subsidy were deducted from the
Annexes II and III to the basic Regulation. Lastly, an
credits so established to arrive at the subsidy amounts as
exporter is eligible for the DEPBS benefits regardless of
numerator, pursuant to point (a) of the second
whether it imports any inputs at all. In order to obtain
subparagraph of Article 7(1) of the basic Regulation.
the benefit, it is sufficient for an exporter to simply
export goods without demonstrating that any input
material was imported. Thus, even exporters which
procure all of their inputs locally and do not import
(39) In
accordance
with
Article
7(2)
of
the
basic
Regulation
any goods which can be used as inputs are still entitled
these subsidy amounts have been allocated over the total
to benefit from the DEPBS.
export turnover during the review investigation period as
appropriate denominator, because the subsidy is
contingent upon export performance and it was not
granted by reference to the quantities manufactured,
(e) Abolishment of the DEPBS
produced, exported or transported.
(33) By
means
of
Public
Notice
No
54
(RE-2010)/2009-2014
of 17 June 2011, the DEPBS received a final extension of
(40) Based on the above, the subsidy rate established in
three months until 30 September 2011. As no further
respect of this scheme for the applicant during the RIP
extension was published subsequently, the DEPBS has
amounts to 6,7 %.
effectively been withdrawn from 30 September 2011
onwards. Consequently, this scheme will not confer any
benefits on the applicant after 30 September 2011. It has
3.3. Export oriented units (EOU)/export processing
therefore to be verified whether, in accordance with
zones (EPZ)/special economic zones (SEZ)
Article 15(1) of the basic Regulation, measures should
be imposed on this scheme.
(41) In the course of the investigation it was found that the
applicant did not obtain any benefits under EOU/
EPZ/SEZ during the RIP. It was therefore not necessary
to further analyse these schemes in this investigation.
(34) In
this
respect,
it
was
established
that
the
applicant
received similar benefits pursuant to the parallel ‘duty
drawback’ scheme. The duty drawback rate for PET was
3.4. Export Promotion Capital Goods Scheme
5,5 % of fob value, subject to a maximum amount of
(EPCGS)
INR 5,50/kg. However, since the ‘duty drawback’ scheme
was not used during the RIP, it is not possible to
(a) Legal basis
calculate a subsidy amount for this scheme.
(42) The
detailed
description
of
EPCGS
is
contained
in
chapter
5 of FTP 04-09 and of FTP 09-14 as well as in chapter 5
of HOP I 04-09 and of HOP I 09-14.
(35) The
applicant
claimed
that
the
Duty
Drawback
Scheme
conforms with the ‘guidelines on consumption of inputs
in the production process’ in Annex II to the basic Regu
(b) Eligibility
lation, specifically paragraph I of the said Annex.
However, similar to the DEPBS, it was established that
(43) Manufacturer-exporters, merchant-exporters ‘tied to’
the duty drawback rate is determined regardless of
supporting manufacturers and service providers are
whether import duties have actually been paid or not.
eligible for this scheme.

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L 168/10
EN
Official Journal of the European Union
28.6.2012
(c) Practical implementation
point (i) of Annex I to the basic Regulation, because
they are not consumed in the production of the
(44) Under
the
condition
of
an
export
obligation,
a
company
exported products.
is allowed to import capital goods (new and second-hand
capital goods up to 10 years old) at a reduced rate of
duty. To this end, the GOI issues, upon application and
(e) Calculation of the subsidy amount
payment of a fee, an EPCGS licence. The scheme provides
for a reduced import duty rate of 5 % applicable to all
(50) The
subsidy
amount
was
calculated,
in
accordance
with
capital goods imported under the scheme. In order to
Article 7(3) of the basic Regulation, on the basis of the
meet the export obligation, the imported capital goods
unpaid customs duty on imported capital goods spread
must be used to produce a certain amount of export
across a period which reflects the normal depreciation
goods during a certain period. Under FTP 09-14 the
period of such capital goods in the industry concerned,
capital goods can be imported with a 0 % duty rate
i.e. 18,93 years. Interests were added to this amount in
under the EPCGS, but in such case the time period for
order to reflect the full value of the benefit over time.
fulfilment of the export obligation is shorter.
The commercial interest rate for local currency loans
during the review investigation period in India was
considered appropriate for this purpose.
(45) The
EPCGS
licence
holder
can
also
source
the
capital
goods indigenously. In such case, the indigenous manu
facturer of capital goods may avail himself of the benefit
(51) In accordance with Articles 7(2) and 7(3) of the basic
for duty-free import of components required to manu
Regulation this subsidy amount has been allocated over
facture such capital goods. Alternatively, the indigenous
the export turnover during the RIP as appropriate
manufacturer can claim the benefit of deemed export in
denominator, because the subsidy is contingent upon
respect of supply of capital goods to an EPCGS licence
export performance.
holder.
(52) The
subsidy
rate
established
in
respect
of
this
scheme
for
the applicant during the RIP amounts to 0,6 %.
(46) It was found that the applicant used this scheme during
the RIP.
3.5. Focus Market Scheme (FMS)
(d) Conclusion on EPCGS
(a) Legal basis
(47) The
EPCGS
provides
subsidies
within
the
meaning
of
(53) The
detailed
description
of
FMS
is
contained
in
para
point (1)(a)(ii) of Article 3 and point (2) of Article 3 of
graphs 3.9.1 to 3.9.2.2 of FTP 04-09 and paragraphs
the basic Regulation. The duty reduction constitutes a
3.14.1 to 3.14.3 of FTP 09-14 and in paragraphs 3.20
financial contribution by the GOI, since this concession
to 3.20.3 of HOP I 04-09 and paragraphs 3.8 to 3.8.2 of
decreases the GOI’s duty revenue which would be
HOP I 09-14.
otherwise due. In addition, the duty reduction confers a
benefit upon the exporter, because the duties saved upon
importation improve the company’s liquidity.
(b) Eligibility
(54) Any manufacturer-exporter or merchant-exporter is
eligible for this scheme.
(48) Furthermore,
EPCGS
is
contingent
in
law
upon
export
performance, since such licences cannot be obtained
without a commitment to export. Therefore it is
(c) Practical implementation
deemed to be specific and countervailable under

point (a) of the first subparagraph of Article 4(4) of
(55) Under this scheme exports of all products to countries
the basic Regulation. It has been claimed by the
notified under Appendix 37(C) of HOP I 04-09 and HOP
applicant that EPCGS subsidies with regard to the
I 09-14 are entitled to duty credit equivalent to 2,5 % of
purchase of capital goods where the export obligation
the fob value of products exported under this scheme.
was already fulfilled before the RIP should not anymore
Certain type of export activities are excluded from the
be treated as contingent upon export performance.
scheme, e.g. exports of imported goods or transhipped
Therefore they should not be treated as specific
goods, deemed exports, service exports and export
subsidies and should not be countervailed. However,
turnover of units operating under special economic
this claim has to be rejected. It has to be underlined
zones/export operating units. Also excluded from the
that the subsidy itself was contingent upon export
scheme are certain types of products, e.g. diamonds,
performance i.e. it would not have been granted had
precious metals, ores, cereals, sugar and petroleum
the company not accepted a certain export obligation.
products.
(49) EPCGS cannot be considered a permissible duty
(56) The duty credits under FMS are freely transferable and
drawback system or substitution drawback system
valid for a period of 24 months from the date of issue of
within the meaning of point (1)(a)(ii) of Article 3 of
the relevant credit entitlement certificate. They can be
the basic Regulation. Capital goods are not covered by
used for payment of custom duties on subsequent
the scope of such permissible systems, as set out in
imports of any inputs or goods including capital goods.

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EN
28.6.2012 Official
Journal
of
the
European
Union L
168/11
(57) The credit entitlement certificate is issued from the port
which is found to exist during the RIP as booked by the
from which the exports have been made and after real
applicant on an accrual basis as income at the stage of
isation of exports or shipment of goods. As long as the
export transaction. In accordance with Article 7(2) and
applicant provides to the authorities copies of all relevant
7(3) of the basic Regulation, this subsidy amount (nomi
export documentation (e.g. export order, invoices,
nator) has been allocated over the export turnover during
shipping bills, bank realisation certificates), the GOI has
the RIP as appropriate denominator, because the subsidy
no discretion over the granting of the duty credits.
is contingent upon export performance and it was not
granted by reference to the quantities manufactured,
produced, exported or transported.
(58) It was found that the applicant used this scheme during
the RIP.
(63) The
subsidy
rate
established
with
regard
to
this
scheme
during the RIP for the applicant amounts to less
(d) Conclusion on FMS
than 0,1 %.
(59) The FMS
provides subsidies within the meaning of
point (1)(a)(ii) of Article 3 and point (2) of Article 3 of
the basic Regulation. A FMS duty credit is a financial
3.6. Export Credit Scheme (ECS)
contribution by the GOI, since the credit will eventually
be used to offset import duties, thus decreasing the GOI’s
(64) It was established that the applicant received the benefit
duty revenue which would be otherwise due. In addition,
of preferential interest rates for its export financing
the FMS duty credit confers a benefit upon the exporter,
during the RIP until 30 June 2011. The legal basis for
because it improves its liquidity.
this preferential interest rate is set out in Master Circular
on Rupee/Foreign Currency Export Credit & Customer
Services to Exporters DBOD No DIR. (Exp). BC
(60) Furthermore,
FMS
is
contingent
in
law
upon
export
07/04.02.02/2009-10 of the RBI, which is addressed to
performance, and therefore deemed to be specific and
all commercial banks in India.
countervailable under point (a) of the first subparagraph
of Article 4(4) of the basic Regulation.
(65) On
1 July 2011, the terms and conditions of the
ECS were revised by Master Circular on Rupee/Foreign
(61) This
scheme
cannot
be
considered
a
permissible
duty
Currency Export Credit & Customer Services to Exporters
drawback system or substitution drawback system
DBOD No DIR. (Exp). BC 04/04.02.002/2011-12 of the
within the meaning of point (1)(a)(ii) of Article 3 of
RBI. The revised conditions did not confer any benefits
the basic Regulation. It does not conform to the strict
on the applicant. In accordance with Article 15(1) of the
rules laid down in point (i) of Annex I, Annex II (defi
basic Regulation, this scheme should therefore not be
nition and rules for drawback) and Annex III (definition
countervailed.
and rules for substitution drawback) to the basic Regu
lation. An exporter is under no obligation to actually
consume the goods imported free of duty in the
production process and the amount of credit is not
3.7. Income Tax Exemption Scheme (ITES)
calculated in relation to actual inputs used. There is no
system or procedure in place to confirm which inputs are
(66) In the course of the investigation it was found that the
consumed in the production process of the exported
applicant did not obtain any benefits under ITES during
product or whether an excess payment of import
the RIP. It was therefore not necessary to further analyse
duties occurred within the meaning of point (i) of
this scheme in this investigation.
Annex I and Annexes II and III to the basic Regulation.
An exporter is eligible for FMS benefits regardless of
whether it imports any inputs at all. In order to obtain
the benefit, it is sufficient for an exporter to simply
3.8. West Bengal Incentive Scheme 1999 (WBIS
export goods without demonstrating that any input
1999)
material was imported. Thus, even exporters which
procure all of their inputs locally and do not import
(67) The
State
of
West
Bengal
grants
to
eligible
industrial
enterprises incentives in the form of a number of
any goods which can be used as inputs are still entitled
benefits, including a remission of sales tax and central
to benefit from FMS. Moreover, an exporter can use FMS
sales tax on sales of finished goods, in order to
duty credits in order to import capital goods although
encourage the industrial development of economically
capital goods are not covered by the scope of permissible
backward areas within this State.
duty drawback systems, as set out in point (i) of Annex I
to the basic Regulation, because they are not consumed
in the production of the exported products.
(a) Legal basis
(e) Calculation of the subsidy amount
(68) The detailed description of this scheme as applied by the
Government of West Bengal (GOWB) is set out in Notifi
(62) The
amount
of
countervailable
subsidies
was
calculated
cation No 580-CI/H of 22 June 1999 of the GOWB
on the basis of the benefit conferred on the recipient,
Commerce & Industries Department.

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L 168/12
EN
Official Journal of the European Union
28.6.2012
(b) Eligibility
3.9. Amount of countervailable subsidies
(69) Companies
setting
up
a
new
industrial
establishment
or
(75) The
amount
of
countervailable
subsidies
determined
in
making a large-scale expansion of an existing industrial
accordance with the provisions of the basic Regulation,
establishment in backward areas are eligible to avail
expressed ad valorem, for the applicant amounts to 8,7 %.
benefits under this scheme. Nevertheless, an exhaustive
This amount of subsidisation exceeds the de minimis
list of ineligible industries (negative list of industries)
threshold mentioned under Article 14(5) of the basic
exists preventing companies in certain fields of oper
Regulation.
ations from benefiting from the incentives.
(76) The
levels
of
subsidisation
established
in
the
current
procedure for the applicant is as follows:
(c) Practical implementation
(70) Under
this
scheme,
companies
must
invest
in
backward
Schemes DEPBS EPCGS FMS WBIS Total
areas. These areas, which represent certain territorial units
in West Bengal are classified according to their economic
Dhunseri Petrochem 6,7 % 0,6
% <
0,1
% 1,4
% 8,7
%
development into different categories while at the same
& Tea Ltd
time there are developed areas excluded from the appli
cation of the incentive schemes. The main criteria to
establish the amount of the incentives are the size of
(77) It
is
therefore
considered
that,
pursuant
to
Article
19
of
the investment and the area in which the enterprise is
the basic Regulation, subsidisation continued during
or will be located.
the RIP.
3.10. Lasting nature of changed circumstances with
(d) Conclusion
regard to subsidisation
(71) This
scheme
provides
subsidies
within
the
meaning
of
(78) In
accordance
with
Article
19(4)
of
the
basic
Regulation,
point (1)(a)(ii) of Article 3 and point (2) of Article 3 of
it was also examined whether the changed circumstances
the basic Regulation. It constitutes a financial
could reasonably be considered to be of a lasting nature.
contribution by the GOWB, since the incentives
granted, in the present case sales tax and central sales
(79) It was established that, during the RIP, the applicant
tax remissions on sales of finished goods, decrease tax
continued to benefit from countervailable subsidisation
revenue which would be otherwise due. In addition, these
by the GOI. Further, the subsidy rate found during the
incentives confer a benefit upon a company, because they
present review is lower than that established during the
improve its financial situation since taxes otherwise due
last review investigation. It was equally established that
are not paid.
the changes claimed by the applicant in recital 7 did
indeed take place. Indeed, the applicant did no longer
benefit from the EOU scheme during the RIP as
(72) Furthermore,
this
scheme
is
regionally
specific
in
the
indicated in recital 41.
meaning of point (a) of the first subparagraph of
Article 4(2) and Article 4(3) of the basic Regulation
(80) However,
it
was
also
established
that
the
most
important
since it is only available to certain companies having
scheme used by the applicant during the RIP (i.e. DEBPS)
invested within certain designated geographical areas
was discontinued on 30 September 2011, and another
within the jurisdiction of the State concerned. It is not
scheme not used during the RIP (i.e. duty drawback) is
available to companies located outside these areas and, in
currently used by the applicant. It is therefore evident
addition, the level of benefit is differentiated according to
that the situation prevailing during the RIP is not of a
the area concerned.
lasting nature, as it has already significantly changed in
the meantime.
(73) The
WBIS
1999
is
therefore
countervailable.
(81) It is therefore concluded that the partial interim review
investigation should be terminated without amending the
countervailing measures in force. The applicant, as well
(e) Calculation of the subsidy amount
as the other parties concerned, were informed of the facts
and considerations on the basis of which it was intended
(74) The
subsidy
amount
was
calculated
on
the
basis
of
the
to propose the termination of the investigation,
amount of the sales tax and central sales tax on sales of

finished goods normally due during the review investi
gation period but which remained unpaid under this
HAS ADOPTED THIS REGULATION:
scheme. In accordance with Article 7(2) of the basic
Regulation, the amount of subsidy (numerator) has
Article 1
then been allocated over total sales during the review
investigation period as appropriate denominator,
The partial interim review of the countervailing measures
because the subsidy is not export contingent and it
applicable to imports of polyethylene terephthalate currently
was not granted by reference to the quantities manufac
falling within CN code 3907 60 20 and originating, inter alia,
tured, produced, exported or transported. The subsidy
in India is hereby terminated without amending the measures in
rate obtained amounted to 1,4 %.
force.

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EN
28.6.2012 Official
Journal
of
the
European
Union L
168/13
Article 2
This Regulation shall enter into force on the day following that 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 Luxembourg, 26 June 2012.
For the Council
The President
N. WAMMEN

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Document Outline

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