HTML PUBLIC "-//W3C//DTD HTML 4.01 Transitional//EN"EN
23.5.2013 Official
Journal
of
the
European
Union L
137/1
II
(Non-legislative acts)
REGULATIONS
COUNCIL IMPLEMENTING REGULATION (EU) No 461/2013
of 21 May 2013
imposing a definitive countervailing duty on imports of certain polyethylene terephthalate (PET)
originating in India following an expiry review pursuant to Article 18 of Regulation (EC)
No 597/2009
THE COUNCIL OF THE EUROPEAN UNION,
later partial interim review was terminated without
amending the measures in force by Implementing
Regulation (EU) No
559/2012
( 7 ). By Decision
2000/745/EC (
Having regard to the Treaty on the Functioning of the European

8 ) the Commission accepted undertakings
setting a minimum import price offered by three
Union,
exporting producers in India.
Having regard to Council Regulation (EC) No 597/2009 of
11 June 2009 on protection against subsidised imports from
(2) The
countervailing
measures
consist
of
a
specific
duty.
countries not members of the European Community
( 1 )
The rate of the duty is between 0 and 106,5 EUR per
('the basic Regulation') and in particular Article 18 thereof,
tonne for individually named Indian producers with a
residual rate of 69,4 EUR per tonne imposed on
imports from all other producers.
Having regard to the proposal submitted by the European
Commission after consulting the Advisory Committee,
2. Existing anti-dumping measures
Whereas:
(3) By
Regulation
(EC)
No
2604/2000
( 9 ), the Council
imposed a definitive anti-dumping duty on imports of
PET originating, inter alia, in India. Following an expiry
A. PROCEDURE
review, the Council, by Regulation (EC)
No 192/2007 ( 10 ), imposed a definitive anti-dumping
1. Measures in force
duty for a further period of five years.
(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
India. By Regulation (EC) No 1645/2005 ( 3 ), the Council
3. Request for an expiry review
amended the level of countervailing measures in force
against imports of PET from India. The amendments
(4) Following the publication of a Notice of impending
were a result of an accelerated review initiated pursuant
expiry ( 11 ) of the definitive countervailing measures in
to Article 20 of the basic Regulation. Following an expiry
force, the Commission, on 25 November 2011,
review, the Council by Regulation (EC) No 193/2007 ( 4 )
received a request for the initiation of the review,
imposed a definitive countervailing duty for a further
pursuant to Article 18 of the basic Regulation ('the
period of five years. The countervailing measures
expiry review'). The request was lodged by the
were subsequently amended by Regulation (EC)
Committee of Polyethylene Terephthalate Manufacturers
No 1286/2008 ( 5 ) and Implementing Regulation (EU)
in Europe ('the applicant') on behalf of producers repre
No 906/2011 ( 6 ), following partial interim reviews. A
senting nearly 95 % of the Union production of certain
polyethylene terephthalate.
( 1 ) OJ L 188, 18.7.2009, p. 93.
( 2 ) OJ L 301, 30.11.2000, p. 1.
( 7 ) OJ L 168, 28.6.2012, p. 6.
( 3 ) OJ L 266, 11.10.2005, p. 1.
( 8 ) OJ L 301, 30.11.2000, p. 88.
( 4 ) OJ L 59, 27.2.2007, p. 34.
( 9 ) OJ L 301, 30.11.2000, p. 21.
( 5 ) OJ L 340, 19.12.2008, p. 1.
( 10 ) OJ L 59, 27.2.2007, p. 1.
( 6 ) OJ L 232, 9.9.2011, p. 19.
( 11 ) OJ C 116, 14.4.2011, p. 10.

---

L 137/2
EN
Official Journal of the European Union
23.5.2013
(5)
The request was based on the grounds that the expiry of
(11) Interested
parties
were
given
the
opportunity
to
make
the measures would be likely to result in a continuation
their views known in writing and to request a hearing
or recurrence of subsidisation and injury to the Union
within the time limit set in the Notice of initiation. All
industry.
interested parties, who so requested and showed that
there were particular reasons why they should be
heard, were granted a hearing.
(6) Prior
to
the
initiation
of
the
expiry
review,
and
in
accordance with Articles 22(1) and 10(7) of the basic
Regulation, the Commission notified the Government
(12) In view of the apparent large number of exporting
of India ('GOI') that it had received a properly docu
producers in India as well as Union producers and
mented review request and invited the GOI for consul
importers it was considered appropriate to examine
tations with the aim of clarifying the situation as regards
whether sampling should be used in accordance with
the contents of the review request and arriving at a
Article 27 of the basic Regulation. In order to enable
mutually agreed solution. However, the Commission
the Commission to decide whether sampling would be
did not receive any answer from the GOI regarding its
necessary and, if so, to select a sample, the exporting
offer for consultations.
producers and unrelated importers were requested to
make themselves known within 15 days of the initiation
of the review and to provide the Commission with the
information requested in the Notice of initiation.
4. Initiation of an expiry review
(7) Having
determined,
after
having
consulted
the
Advisory
Committee, that sufficient evidence existed for the
initiation of an expiry review, the Commission
(13) Seven
exporting
producers
responded
to
the
sampling
announced on 24 February 2012, by a notice
exercise and indicated a willingness to cooperate with
published in the Official Journal of the European Union ( 1 )
the review investigation. On this basis, a sample of
('the notice of initiation'), the initiation of an expiry
three exporting producers was selected based on the
review pursuant to Article 18 of the basic Regulation.
volume of exports to the Union. No objections were
made to this sample either by the sampled producers
themselves, non-sampled producers or the relevant auth
orities in India.
5. Parallel investigation
(8) On
24
February
2012,
the
Commission
also
opened
a
review pursuant to Article 11(2) of Regulation (EC)
No 1225/2009 on the anti-dumping measures in force
(14) The
three
sampled
exporting
producers
were
duly
sent
on imports of PET originating in India, Indonesia,
questionnaires to complete and replies were received
Malaysia, Taiwan and Thailand (
from them all. However the questionnaire reply of one

2 ).
Indian sampled producer revealed that it only exported
insignificant volumes of the product concerned during
the RIP and therefore it was not relevant to calculate
6. Investigation
subsidy rates for that company. Verification visits were
eventually completed in the two remaining exporting
6.1. Review investigation period and the period considered
producers which together represented 99 % of total
imports in volume from India to the Union during the
(9)
The investigation of the likelihood of a continuation or
RIP.
recurrence of subsidisation covered the period from
1 January 2011 to 31 December 2011 (the 'review inves
tigation period' or 'RIP'). The examination of the trends
relevant for the assessment of the likelihood of a
(15) Following the disclosure of the essential facts and
continuation or recurrence of injury covered the period
considerations ('disclosure'), one Indian cooperating
from 1 January 2008 to the end of the RIP (hereinafter
producer requested a calculation of a subsidy margin.
referred to as the 'period considered').
In this respect it was reconfirmed that the exports
from this company were insignificant and consequently
had no impact on the determination of the likelihood of
continuation or recurrence of subsidisation in the present
6.2. Parties concerned by the investigation
expiry review. Therefore, this request was rejected.
(10) The
Commission officially
advised
the applicant,
the
exporting producers in the country concerned, the
importers, the users known to be concerned, and the
representatives of the country concerned of the initiation
(16) The
Commission
announced
in
the
notice
of
initiation
of the expiry review.
that it had provisionally selected a sample of Union
producers. This sample consisted of four companies,
( 1 ) OJ C 55, 24.2.2012, p. 14.
out of the thirteen Union producers that were known
( 2 ) OJ C 55, 24.2.2012, p. 4.
prior to the initiation of the investigation, selected on

---

EN
23.5.2013 Official
Journal
of
the
European
Union L
137/3
the basis of the largest representative volume of
following the comments of the parties concerning
production and sales that can reasonably be investigated
specific company data. None of the comments
within the time available. The sample represented over
made were considered founded.
50 % of the total estimated Union production and sales
during the RIP. Interested parties were invited to consult
the file and to comment on the appropriateness of this
— As required by Article 27 of the basic Regulation the
choice within 15 days of the date of publication of the
sample was established to represent the largest repre
notice of initiation. All interested parties, who so
sentative volume of production and sales that can be
requested and showed that there were particular
reasonably investigated within the time available. The
reasons why they should be heard, were granted a
entities belonging to larger groups that were found to
hearing.
operate independently from other subsidiaries of the
same group were considered representative of the
Union industry and there was therefore no need to
(17) Certain
interested
parties
raised
objections
concerning
the
investigate the entire group on a consolidated basis.
sampling of Union producers. They claimed that: (i) the
At the same time, the companies were sampled as
Commission should not resort to sampling, in particular,
economic entities, ensuring that all relevant data
since no sampling was used in the previous investigation;
could be verified. Moreover, the divestments and
(ii) the method used for the selection of the sample was
existence of related sales were part of the character
contested on the grounds that it 'confuses three different
istics of the sector in the period considered and
steps', namely, standing exercise, definition of the Union
therefore none of these elements was considered to
industry and sampling exercise; (iii) the provisional
diminish the representativity of the sample.
sample was set up on the basis of incorrect and
incomplete information; (iv) selected provisional sample
is not representative because it includes entities rather
(19) Following the disclosure the parties reiterated the above-
than groups; it was also claimed that including
mentioned arguments which have already been
companies that in one case went through a recent
addressed.
divestment or in another case have related sales
diminishes the representativity of the sample.
(20) Sampling
for
unrelated
importers
was
foreseen
in
the
notice of initiation. None of the twenty four contacted
(18) The
arguments
raised
by
the
parties
were
addressed
as
unrelated importers cooperated in the present investi
follows:
gation.
(21) All
five
known
suppliers
of
raw
material
were
contacted
— The decision to use a sample of Union producers is
upon the initiation and received relevant questionnaire.
made for each investigation independently depending
Two suppliers came forward and replied to the question
on the particular circumstances of each case and
naire.
Article 22(6) of the basic Regulation does not
govern the use of such a sample for the deter
mination of injury in the context of an expiry
review. Unlike the previous investigations, where
(22) All
known
users
and
users'
associations
were
contacted
upon the initiation. Seventeen users submitted a ques
the investigation of all companies that came
tionnaire reply. Twenty associations of users from 16
forward and cooperated was feasible, the Commission
Member States made themselves known and made
considered in the current review that, in view of their
submissions.
large number, not all Union producers could be
reasonably investigated in the time available and
that the conditions of Article 27 were therefore met.
7. Verification of information received
(23) The
Commission
sought
and
verified
all
the
information
— The Commission did not 'confuse' the determination
it deemed necessary for a determination of the likelihood
of the standing, the determination of the Union
of a continuation or recurrence of subsidisation and
industry and the selection of the provisional sample
resulting injury and of the Union interest. Verification
as these steps remained independent from each other
visits were carried out at the premises of the GOI in
and were decided upon separately. It was not demon
Delhi and the following interested parties:
strated to what extent the use of the production and
sales data provided by the Union producers in the
context of the standing exercise had affected the
(a) Exporting producers
representativity of the sample.
— Dhunseri Petrochem and Tea Limited, Kolkata,
— The sample was set up on the basis of the
India;
information available at the time of selection in
accordance with Article 27 of the basic Regulation.
The representativity of the sample was reviewed
— Reliance Industries Limited, Navi Mumbai, India;

---

L 137/4
EN
Official Journal of the European Union
23.5.2013
(b) Union producers
(e) Status Holder Incentive Scrip ('SHIS')
— Indorama Polymers Europe, UAB, Netherlands;
(f) Advance Authorisation Scheme ('AAS')
— Equipolymers, Italy, Germany;
(g) Export Promotion Capital Goods Scheme ('EPCGS')
— Neo Group, UAB, Lithuania;
(h) Special economic zones/export oriented units
('SEZ/EOU')
— Novapet SA, Spain;
(i) Export Credit Scheme ('ECS')
(c) Users in the Union
(j) Income Tax Exemption Scheme ('ITES')
— Coca-Cola Europe, Belgium;
Regional schemes
— Nestle Waters France, France.
(k) West Bengal Incentive Scheme ('WBIS')
B. PRODUCT CONCERNED AND LIKE PRODUCT
1. Product concerned
(l) Capital investment incentive scheme of the
Government of Gujarat
(24) The
product
concerned
by
this
review
is
the
same
as
the
one in the original investigation, namely PET with a
viscosity number of 78 ml/g or higher, according to
(m) Gujarat sales tax incentive scheme ('GSTIS')
ISO Standard 1628-5, originating in India. It is
currently falling within CN code 3907 60 20.
(n) Gujarat electricity duty exemption scheme ('GEDES')
2. Like product
(o) Package Scheme of Incentives ('PSI') of the
(25) As in the original and in the review investigations, it was
Government of Maharashtra
found that the product concerned, i.e. PET produced and
sold on the domestic market of the country concerned,
and PET produced and sold by Union producers had the
(27) The
schemes
specified
under
points
(a)
and
(c)
to
(h)
same basic physical and chemical characteristics and uses.
above are based on the Foreign Trade (Development
They were therefore considered to be like products
and Regulation) Act 1992 (No 22 of 1992), which
according to Article 2(c) of the basic Regulation.
entered into force on 7 August 1992 ('Foreign Trade
Act'). The Foreign Trade Act authorises the GOI to
issue notifications regarding the export and import
C. LIKELIHOOD OF A CONTINUATION OR
policy. These are summarised in 'Foreign Trade Policy'
RECURRENCE OF SUBSIDISATION
documents, which are issued by the Ministry of
Commerce every five years and updated regularly. The
1. Introduction
Foreign Trade Policy document relevant to the RIP of
this investigation is the 'Foreign Trade Policy 2009-
(26) On the basis of the information contained in the review
2014' ('FTP 09-14'). In addition, the GOI also sets out
request and the replies to the Commission's question
the procedures governing FTP 09-14 in a 'Handbook of
naire, the following schemes, which allegedly involve
Procedures, Volume I' ('HOP I 09-14'). The Handbook of
the granting of subsidies, were investigated.
Procedures is also updated on a regular basis.
Nationwide schemes
(28) The
scheme
specified
under
point
(b)
above
is
based
on
section 75 of the Customs Act of 1962, on section 37 of
(a) Duty Entitlement Passbook Scheme ('DEPBS')
the Central Excise Act of 1944, on sections 93A and 94
of the Financial Act of 1994 and on the Customs,
Central Excise Duties and Service Tax Drawback Rules
(b) Duty Drawback Scheme ('DDS')
of 1995. Drawback rates are published on a regular
basis; those applicable to the RIP were the All Industry
Rates (AIR) of Duty Drawback 2011-12, published in
(c) Focus Market Scheme ('FMS')
notification No.
68/2011- Customs (N.T.), dated
22 September 2011. The duty drawback scheme is also
referred to as a duty remission scheme in chapter 4 of
(d) Focus Product Scheme ('FPS')
FTP 2009-2014.

---

EN
23.5.2013 Official
Journal
of
the
European
Union L
137/5
(29) The
scheme
specified
under
point
(i)
above
is
based
on
Regional schemes
sections 21 and 35A of the Banking Regulation Act
1949, which allow the Reserve Bank of India ('RBI') to
direct commercial banks in the field of export credits.
(f) West Bengal Incentive Scheme ('WBIS').
(30) The
scheme
specified
under
point
(j)
above
is
based
on
2. Duty Entitlement Passbook Scheme ('DEPBS')
the Income Tax Act of 1961, which is amended by the
yearly Finance Act.
(a) Legal Basis
(37) The detailed description of the DEPBS is contained in
chapter 4.3 of FTP 09-14 as well as in chapter 4 of
(31) The
scheme
specified
under
point
(k)
above
is
admin
HOP I 09-14.
istered by the Government of West Bengal and set out
in Government of West Bengal Commerce & Industries
Department notification No 580-CI/H of 22 June 1999,
(b) Eligibility
replaced by notification No 134-CI/O/Incentive/17/03/I
of 24 March 2004.
(38) Any manufacturer-exporter or merchant-exporter is
eligible for this scheme.
(32) The
scheme
specified
under
point
(l)
above
is
admin
istered by the Government of Gujarat and is based on
(c) Practical implementation
Gujarat's industrial incentive policy.
(39) An
exporter
can
apply
for
DEPBS
credits
which
are
calculated as a percentage of the value of products
exported under this scheme. Such DEPBS rates have
(33) The
scheme
specified
under
point
(m)
above
is
admin
been established by the Indian authorities for most
istered by the Government of Gujarat and based on its
products, including the product concerned. They are
industrial incentive policy
determined on the basis of Standard Input Output
Norms ('SIONs') taking into account a presumed
import content in the export product and the customs
duty incidence on the presumed import content,
(34) The
scheme
specified
under
point
(n)
above
is
based
on
the Bombay Electricity Duty Act of 1958.
regardless of whether import duties have actually been

paid or not. The DEPBS rate for the product concerned
during the RIP of the current investigation was 8 % with
a value cap of 58 INR/kg.
(35) The
scheme
specified
under
point
(o)
above
is
managed
by the state of Maharashtra and is based on resolutions
of the Government of Maharashtra Industries, Energy and
(40) To
be
eligible
for
benefits
under
this
scheme,
a
company
Labour Department.
must export. At the time of the export transaction, a
declaration must be made by the exporter to the
Indian authorities indicating that the export is taking
(36) The investigation revealed that, during the RIP, the
place under the DEPBS. In order for the goods to be
following schemes conferred benefits upon the sampled
exported, the Indian customs authorities issue, during
exporting producers in respect of the product concerned:
the dispatch procedure, an export shipping bill. This
document shows, inter alia, the amount of DEPBS
credit which is to be granted for that export transaction.
At this point in time, the exporter knows the benefit it
Nationwide scheme
will receive. Once the customs authorities issue an export
shipping bill, the GOI has no discretion over the granting
of a DEPBS credit. The relevant DEPBS rate to calculate
(a) Duty Entitlement Passbook Scheme ('DEPBS')
the benefit is that which applied at the time the export
declaration was made.
(b) Duty Drawback Scheme ('DDS')
(41) It
was
found
that
in
accordance
with
Indian
accounting
standards, DEPBS credits can be booked on an accrual
basis as income in the commercial accounts, upon
(c) Focus Market Scheme ('FMS')
fulfilment of the export obligation. Such credits can be
used for payment of customs duties on subsequent
imports of any goods, except capital goods and goods
(d) Status Holder Incentive Scrip ('SHIS')
where there are import restrictions. Goods imported
against such credits can be sold on the domestic
market (subject to sales tax) or used otherwise. DEPBS
credits are freely transferable and valid for a period of 24
(e) Advance Authorisation Scheme ('AAS')
months from the date of issue.

---

L 137/6
EN
Official Journal of the European Union
23.5.2013
(42) Applications
for
DEPBS
credits
are
electronically
filed
and
published subsequently, the DEPBS has effectively been
can cover an unlimited amount of export transactions.
withdrawn from 30 September 2011 onwards. Therefore
The deadline to submit applications is 3 months after
it was necessary to verify whether measures could be
exportation, but as clearly provided in paragraph 9.3 of
imposed with regard to Article 15(1) of the basic Regu
the HOP I 09-14, applications received after the expiry of
lation.
submission deadlines can always be considered with the
imposition of a minor penalty fee (i.e. 10 % of the
entitlement).
(48) The
GOI
explained
to
the
Commission
that
upon
with
drawal of the DEPBS scheme, companies could opt for
other duty exemption/remission schemes defined under
(43) It was found that both sampled companies used this
chapter 4 of FTP 09-14, i.e. the Advance Authorisation
scheme during the first three quarters of the RIP.
Scheme (AAS) or the Duty Drawback Scheme (DDS).
(d) Conclusion on DEPBS
(49) The
investigation
revealed
that
both
sampled
companies
started availing themselves of DDS immediately after the
(44) The
DEPBS
provides
subsidies
within
the
meaning
of
DEPBS was withdrawn. It must be noted that DDS has
Article 3(1)(a)(ii) and Article 3(2) of the basic Regulation.
been introduced in 1995 and coexisted with DEPBS
A DEPBS credit is a financial contribution by the GOI,
during the three first quarters of the RIP and for a
since the credit will eventually be used to offset import
number of years before the RIP. Exporters could,
duties, thus decreasing the GOI's duty revenue which
however not avail themselves of DDS and DEPBS simul
would be otherwise due. In addition, the DEPBS credit
taneously for the same exports. During the first three
confers a benefit upon the exporter, because it improves
quarters of the RIP, the DDS rate amounted to 2,2 %
its liquidity.
with a cap of 1,5 INR/kg, making the DDS less
generous and hence less attractive than the DEPBS. It
must be noted that the GOI took steps to organise a
smooth transition from DEPBS to DDS, as demonstrated
(45) Furthermore, the DEPBS is contingent in law upon
in circular No. – 42/2011-Customs, dated 22 September
export performance, and is therefore deemed to be
2011. In this circular it is explained that "the [duty]
specific and countervailable under Article 4(4), first
drawback schedule this year incorporates items which
subparagraph, point (a) of the basic Regulation.
were hitherto under the DEPB[S] scheme". The same
circular states that for sectors operating under DEPBS,
it "has been decided to provide a smooth transition for
(46) This
scheme
cannot
be
considered
as
permissible
duty
items in these sectors while incorporating these in the
drawback system or substitution drawback system
drawback schedule. As a transitory arrangement, these
within the meaning of Article 3(1)(a)(ii) of the basic
items will suffer a modest reduction from their
Regulation. It does not conform to the strict rules laid
DEPB[S] rates, ranging from 1 % to 3 % for most
down in Annex I point (i), Annex II (definition and rules
items." In other words, this circular indicates that the
for drawback) and Annex III (definition and rules for
duty drawback rates in force w.e.f. 1 October 2011
substitution drawback) of the basic Regulation. An
were determined so that they would confer a similar
exporter is under no obligation to actually consume
benefit as the withdrawn DEPBS.
the goods imported free of duty in the production
process and the amount of credit is not calculated in
relation to actual inputs used. Moreover, there is no
(50) As
of
1
October
2011,
the
DDS
rate
applicable
to
the
system or procedure in place to confirm which inputs
product concerned was increased from 2,2 % to 5,5 % of
are consumed in the production process of the exported
FOB value and the associated cap was raised from 1,5
product or whether an excess payment of import duties
INR/kg to 5,5 INR/kg. This new rate was found to confer
occurred within the meaning of point (i) of Annex I and
similar levels of subsidiation as the DEPBS was until the
Annexes II and III of the basic Regulation. Lastly, an
30 September 2011 with its 8 % rate and 58 INR/kg cap.
exporter is eligible for the DEPBS benefits regardless of
In function of PET prices prevailing during the RIP, the
whether it imports any inputs at all. In order to obtain
DEPBS cap was generally applicable resulting in a theor
the benefit, it is sufficient for an exporter to simply
etical benefit of 4,64 INR/kg or 5,8 %. In the case of the
export goods without demonstrating that any input
DDS, the cap was not applicable so that the theoretical
material was imported. Thus, even exporters which
benefit amounted to 5,5 %.
procure all of their inputs locally and do not import
any goods which can be used as inputs are still entitled
to benefit from the DEPBS.
(51) The investigation confirmed the reasoning of the
previous recital. The average annualised subsidy
margins of the sampled companies were 5,5 % and 6 %
(e) Abolishment of the DEPBS and transition to DDS
for DEPB and DDS, respectively.
(47) By
means
of
Public
Notice
No
54
(RE-2010)/2009-2014
of 17 June 2011, the DEPBS received a final three
months extension which prolonged its applicability
(52) A
comparison
of
both
schemes
also
shows
that
they
until 30 September 2011. As no further extension was
share numerous implementation characteristics.

---

EN
23.5.2013 Official
Journal
of
the
European
Union L
137/7
(53) Recitals
(47)(48)
to
(51)
above
demonstrate
that,
even
3. Duty Drawback Scheme ('DDS')
though the DEPBS scheme was withdrawn, the
underlying benefits continued to be conferred without
(a) Legal Basis
discontinuation and at an almost identical level by
providing a seamless transition to the duty drawback
(58) The detailed description of the DDS is contained in the
scheme. For that reason, it is concluded that the
Custom & Central Excise Duties Drawback Rules, 1995
subsidies have not been withdrawn within the meaning
as amended by successive notifications.
of Article 15(1) and that DEPBS is countervailable.
(b) Eligibility
(59) Any manufacturer-exporter or merchant-exporter is
(54) Following the disclosure of the essential facts and
eligible for this scheme.
considerations, one exporting producer argued that the
DEPBS has been withdrawn and therefore should not be
countervailed. In reply to this, it is noted that, as also
explained above in recital (47) above, the DEPBS has
(c) Practical implementation
ceased on 30 September 2011. However, the
subsidisation continued and exporters have the possibility
(60) An
eligible
exporter
can
apply
for
drawback
amount
as an alternative to the DEPBS to apply for and receive
which is calculated as a percentage of the FOB value of
benefits under e.g. the DDS or the AAS. Consequently,
products exported under this scheme. The drawback rates
this argument was rejected.
have been established by the GOI for a number of
products, including the product concerned. They are
determined on the basis of the average quantity or
value of materials used as inputs in the manufacturing
of a product and the average amount of duties paid on
(f) Calculation of the subsidy amount
inputs. They are applicable regardless of whether import
duties have actually been paid or not. The DDS rate for
(55) In
accordance
with
Articles
3(2)
and
5
of
the
basic
Regu
the product concerned during the RIP was 5,5 % of FOB
lation, the amount of countervailable subsidies was
value, subject to a cap of 5,5 INR/kg.
calculated in terms of the benefit conferred on the
recipient, which is found to exist during the review inves
tigation period. In this regard, it was considered that the
benefit is conferred on the recipient at the time when an
(61) To
be
eligible
to
benefits
under
this
scheme,
a
company
export transaction is made under this scheme. At that
must export. At the moment when shipment details are
moment, the GOI is liable to forego the customs duties,
entered in the Customs server (ICEGATE), it is indicated
which constitutes a financial contribution within the
that the export is taking place under the DDS and the
meaning of Article 3(1)(a)(ii) of the basic Regulation.
DDS amount is fixed irrevocably. After the shipping
Once the customs authorities issue an export shipping
company has filed the Export General Manifest (EGM)
bill which shows, inter alia, the amount of DEPBS credit
and the Customs office has satisfactorily compared that
which is to be granted for that export transaction, the
document with the shipping bill data, all conditions are
GOI has no discretion as to whether or not to grant the
fulfilled to authorise the payment of the drawback
subsidy. In the light of the above, it is considered appro
amount by either direct payment on the exporter's
priate to assess the benefit under the DEPBS as being the
bank account or by draft.
sums of the credits earned on export transactions made
under this scheme during the RIP.
(62) The
exporter
also
has
to
produce
evidence
of
realisation
of export proceeds by means of a Bank Realisation
Certificate (BRC). This document can be provided after
(56) Where justified claims were made, fees necessarily
the drawback amount has been paid but the GOI will
incurred to obtain the subsidy were deducted from the
recover the paid amount if the exporter fails to submit
credits so established to arrive at the subsidy amounts as
the BRC within a given delay.
numerator, pursuant to Article 7(1)(a) of the basic Regu
lation. In accordance with Article 7(2) of the basic Regu
lation these subsidy amounts have been allocated over
the total export turnover of the product concerned
(63) The
drawback
amount
can
be
used
for
any
purpose.
during the RIP as appropriate denominator, because the
subsidy is contingent upon export performance and it
was not granted by reference to the quantities manufac
(64) It
was
found
that
in
accordance
with
Indian
accounting
tured, produced, exported or transported.
standards, the duty drawback amount can be booked on
an accrual basis as income in the commercial accounts,
upon fulfilment of the export obligation.
(57) Based
on
the
above,
the
subsidy
rates
established
in
respect of this scheme for the sampled companies
(65) The
sampled
companies
were
found
to
use
the
DDS
amounted to 3,78 % and 4,42 % respectively.
during the last quarter of the RIP.

---

L 137/8
EN
Official Journal of the European Union
23.5.2013
(d) Conclusion on DDS
moment, the GOI is liable to the payment of the
drawback amount, which constitutes a financial
(66) The
DDS provides subsidies within the meaning of
contribution within the meaning of Article 3(1)(a)(ii) of
Article 3(1)(a)(ii) and Article 3(2) of the basic Regulation.
the basic Regulation. Once the customs authorities issue
A duty drawback amount is a financial contribution by
an export shipping bill which shows, inter alia, the
the GOI. In addition, the duty drawback amount confers
amount of drawback which is to be granted for that
a benefit upon the exporter, because it improves its
export transaction, the GOI has no discretion as to
liquidity.
whether or not to grant the subsidy. In the light of the
above, it is considered appropriate to assess the benefit
under the DDS as being the sums of the drawback
(67) Furthermore,
the
DDS
is
contingent
in
law
upon
export
amounts earned on export transactions made under
performance, and is therefore deemed to be specific and
this scheme during the RIP.
countervailable under Article 4(4), first subparagraph,
point (a) of the basic Regulation.
(73) Where justified claims were made, fees necessarily
incurred to obtain the subsidy were deducted from the
(68) This
scheme
cannot
be
considered
as
permissible
duty
credits so established to arrive at the subsidy amounts as
drawback system or substitution drawback system
numerator, pursuant to Article 7(1)(a) of the basic Regu
within the meaning of Article 3(1)(a)(ii) of the basic
lation. In accordance with Article 7(2) of the basic Regu
Regulation. It does not conform to the strict rules laid
lation these subsidy amounts have been allocated over
down in Annex I point (i), Annex II (definition and rules
the total export turnover of the product concerned
for drawback) and Annex III (definition and rules for
during the review investigation period as appropriate
substitution drawback) of the basic Regulation.
denominator, because the subsidy is contingent upon
export performance and it was not granted by
reference to the quantities manufactured, produced,
(69) There
is
no
system
or
procedure
in
place
to
confirm
exported or transported.
which inputs are consumed in the production process
of the exported product or whether an excess payment
of import duties occurred within the meaning of point (i)
of Annex I and Annexes II and III of the basic Regu
(74) Based on the above, the subsidy rates established in
lation. Lastly, an exporter is eligible for the DDS benefits
respect of this scheme for the sampled companies
regardless of whether it imports any inputs at all. In
concerned amounted to 1,65 % and 1,32 %, respectively.
order to obtain the benefit, it is sufficient for an
exporter to simply export goods without demonstrating
that any input material was imported. Thus, even
4. Focus Market Scheme (FMS)
exporters which procure all of their inputs locally and
do not import any goods which can be used as inputs
(a) Legal basis
are still entitled to benefit from the DDS.
(75) The
detailed
description
of
FMS
is
contained
in
paragraph
3.14 of FTP 09-14 and in paragraph 3.8 of HOP I 09-14.
(70) This
is
confirmed
by
GOI's
circular
n o 24/2001 which
clearly states that "[duty drawback rates] have no relation
to the actual input consumption pattern and actual
(b) Eligibility
incidence suffered on inputs of a particular exporter or
individual consignments […]" and instructs regional
(76) Any manufacturer-exporter or merchant-exporter is
authorities that "no evidence of actual duties suffered
eligible for this scheme.
on imported or indigenous nature of inputs […]
should be insisted upon by the field formations along
with the [drawback claim] filed by exporters".
(c) Practical implementation
(77) Under this scheme exports of all products to countries
(71) In view of the above, it is concluded that DDS is counter
notified under tables 1 and 2 of Appendix 37(C) of HOP
vailable.
I 09-14 are entitled to duty credit equivalent to 3 % of
the FOB value. As of 1 April 2011, exports of all
products to countries notified under table 3 of
(e) Calculation of the subsidy amount
Appendix 37(C) ('Special Focus Markets') are entitled to
a duty credit equivalent to 4 % of the FOB value. Certain
(72) In
accordance
with
Articles
3(2)
and
5
of
the
basic
Regu
types of export activities are excluded from the scheme,
lation, the amount of countervailable subsidies was
e.g. exports of imported goods or transhipped goods,
calculated in terms of the benefit conferred on the
deemed exports, service exports and export turnover of
recipient, which is found to exist during the review inves
units operating under special economic zones/export
tigation period. In this regard, it was considered that the
operating units. Also excluded from the scheme are
benefit is conferred on the recipient at the time when an
certain types of products, e.g. diamonds, precious
export transaction is made under this scheme. At this
metals, ores, cereals, sugar and petroleum products.

---

EN
23.5.2013 Official
Journal
of
the
European
Union L
137/9
(78) The duty credits under FMS are freely transferable and
capital goods are not covered by the scope of permissible
valid for a period of 24 months from the date of issue of
duty drawback systems, as set out in Annex I point (i) of
the relevant credit entitlement certificate. They can be
the basic Regulation, because they are not consumed in
used for payment of custom duties on subsequent
the production of the exported products.
imports of any inputs or goods including capital goods.
(e) Calculation of the subsidy amount
(79) The credit entitlement certificate is issued from the port
from which the exports have been made and after real
(84) The
amount
of
countervailable
subsidies
was
calculated
isation of exports or shipment of goods. As long as the
on the basis of the benefit conferred on the recipient,
applicant provides to the authorities copies of all relevant
which is found to exist during the RIP as booked by the
export documentation (e.g. export order, invoices,
cooperating exporting producer on an accrual basis as
shipping bills, bank realisation certificates), the GOI has
income at the stage of export transaction. In accordance
no discretion over the granting of the duty credits.
with Article 7(2) and 7(3) of the basic Regulation this
subsidy amount (nominator) has been allocated over the
export turnover during the RIP as appropriate denomi
nator, because the subsidy is contingent upon export
(80) It was found that the sampled companies used this
performance and it was not granted by reference to the
scheme during the RIP.
quantities manufactured, produced, exported or trans
ported.
(d) Conclusion on FMS
(85) The
subsidy
rate
established
with
regard
to
this
scheme
(81) The FMS
provides subsidies within the meaning of
during the RIP for the sampled companies concerned
Article 3(1)(a)(ii) and Article 3(2) of the basic Regulation.
amounted to 0,19 % and 0,87 %, respectively.
A FMS duty credit is a financial contribution by the GOI,
since the credit will eventually be used to offset import
duties, thus decreasing the GOI's duty revenue which
would be otherwise due. In addition, the FMS duty
5. Status Holder Incentive Scrip (SHIS)
credit confers a benefit upon the exporter, because it
improves its liquidity.
(a) Legal basis
(86) The
detailed
description
of
SHIS
is
contained
in
chapter
3.16 of FTP 09-14 and in paragraph 3.10 of HOP I 09-
(82) Furthermore,
FMS
is
contingent
in
law
upon
export
14. The detailed description of the Status categories is
performance, and therefore deemed to be specific and
contained in paragraphs 3.10.1 to 3.10.4 of FTP 09-14
countervailable under Article 4(4), first subparagraph,
and in paragraphs 3.1 to 3.5 of HOP I 09-14.
point (a) of the basic Regulation.
(b) Eligibility
(83) This
scheme
cannot
be
considered
a
permissible
duty
drawback system or substitution drawback system
(87) Manufacturer-exporters
or
merchant-exporters
which
are
within the meaning of Article 3(1)(a)(ii) of the basic
recognised as so-called Status holders are eligible for this
Regulation. It does not conform to the strict rules laid
scheme.
down in Annex I point (i), Annex II (definition and rules
for drawback) and Annex III (definition and rules for
substitution drawback) of the basic Regulation. An
(c) Practical implementation
exporter is under no obligation to actually consume

the goods imported free of duty in the production
(88) Merchant as well as manufacturer exporters are eligible
process and the amount of credit is not calculated in
for Status. Depending on their export performance
relation to actual inputs used. There is no system or
during current year plus a number of previous years,
procedure in place to confirm which inputs are
applicants are granted one of the following statuses:
consumed in the production process of the exported
Export House, Star Export House, Trading House, Star
product or whether an excess payment of import
Trading House, Premier Trading House.
duties occurred within the meaning of point (i) of
Annex I and Annexes II and III of the basic Regulation.
An exporter is eligible for FMS benefits regardless of
whether it imports any inputs at all. In order to obtain
(89) Under the SHIS, status holders are entitled to a duty
the benefit, it is sufficient for an exporter to simply
credit equivalent to 1 % of the FOB value of exports in
export goods without demonstrating that any input
sectors specified in paragraph 3.16.4 of FTP 09-14 i.e.
material was imported. Thus, even exporters which
leather (excluding finished leather), textile and jute sector,
procure all of their inputs locally and do not import
handicrafts, engineering sector (excluding some sub-
any goods which can be used as inputs are still entitled
sectors), plastics and basic chemicals (excluding phar
to benefit from FMS. Moreover, an exporter can use FMS
maceutical products). The product concerned, being a
duty credits in order to import capital goods although
type of plastic, is covered by the scheme.

---

L 137/10
EN
Official Journal of the European Union
23.5.2013
(90) The
SHIS
duty
credits
are
not
transferrable
and
must
be
(e) Calculation of the subsidy amount
used to pay duty on import of capital goods used to
manufacture products falling into one of the covered
(98) The
amount
of
countervailable
subsidies
was
calculated
sectors.
on the basis of the benefit conferred on the recipient,
which is found to exist during the RIP as booked by the
cooperating exporting producer on an accrual basis as
income at the stage of the export transaction. In
(91) In
case
an
applicant
has
availed
Zero
Duty
EPCG
during
accordance with Article 7(2) and 7(3) of the basic Regu
a year, it shall not be eligible for SHIS for export made
lation this subsidy amount (nominator) has been
that year.
allocated over the export turnover during the RIP as
appropriate denominator, because the subsidy is
contingent upon export performance and it was not
granted by reference to the quantities manufactured,
(92) The
scheme
was
introduced
in
2009
for
exports
made
produced, exported or transported.
during 2009-2010 and 2010-2011 and has been
extended on a yearly basis since then. The last
extension (cfr. notification No 07/2012 – Customs
dated 9 March 2012) prolonged the validity of the
(99) The
subsidy
rate
established
with
regard
to
this
scheme
scheme until 31 March 2013.
during the RIP for the sole sampled company using that
scheme amounted to 1 %.
(93) It
was
found
that
in
accordance
with
Indian
accounting
standards, the SHIS duty credit can be booked on an
accrual basis as income in the commercial accounts,
6. Export Promotion Capital Goods scheme
upon fulfilment of the export obligation.
('EPCGS')

(a) Legal basis
(100) The detailed description of EPCGS is contained in chapter
(94) The
investigation
revealed
that
one
sampled
company
5 of FTP 09-14 as well as in chapter 5 of HOP I 09-14.
used this scheme during the RIP while the other one
was not eligible as a result of the provision described
in recital (90).
(b) Eligibility
(d) Conclusion on SHIS
(101) Manufacturer-exporters, merchant-exporters "tied to"

supporting manufacturers and service providers are
(95) The
SHIS provides subsidies within the meaning of
eligible for this scheme.
Article 3(1)(a)(ii) and Article 3(2) of the basic Regulation.
A SHIS duty credit is a financial contribution by the GOI,
since the credit will eventually be used to offset import
duties, thus decreasing the GOI's duty revenue which
(c) Practical implementation
would be otherwise due. In addition, the SHIS duty
credit confers a benefit upon the exporter, because it
(102) Under the condition of an export obligation, a company
improves its liquidity.
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
payment of a fee, an EPCGS licence. The scheme provides
(96) Furthermore,
SHIS
is
contingent
in
law
upon
export
for a reduced import duty rate of 3 % applicable to all
performance, and therefore deemed to be specific and
capital goods imported under the scheme. In order to
countervailable under Article 4(4), first subparagraph,
meet the export obligation, the imported capital goods
point (a) of the basic Regulation.
must be used to produce a certain amount of export
goods during a certain period. Under FTP 09-14 the
capital goods can be imported with a 0 % duty rate
under the EPCGS but in such case the time period for
(97) This
scheme
cannot
be
considered
a
permissible
duty
fulfilment of the export obligation is shorter.
drawback system or substitution drawback system
within the meaning of Article 3(1)(a)(ii) of the basic
Regulation. It does not conform to the strict rules laid
down in Annex I point (i), Annex II (definition and rules
(103) The EPCGS licence holder can also source the capital
for drawback) and Annex III (definition and rules for
goods indigenously. In such case, the indigenous manu
substitution drawback) of the basic Regulation. The
facturer of capital goods may avail himself of the benefit
duty credit will eventually be used to pay duties on
for duty free import of components required to manu
imports of capital goods which are not covered by the
facture such capital goods. Alternatively, the indigenous
scope of permissible duty drawback as set out in Annex I
manufacturer can claim the benefit of deemed export in
point (i) of the basic Regulation, because they are not
respect of supply of capital goods to an EPCGS licence
consumed in the production of the exported products.
holder.

---

EN
23.5.2013 Official
Journal
of
the
European
Union L
137/11
(d) Conclusion on EPCGS
established that the benefit obtained by the company was
insignificant and, thus AAS was not analysed further.
(104) The EPCGS provides subsidies within the meaning of
Article 3(1)(a)(ii) and Article 3(2) of the basic Regulation.
The duty reduction constitutes a financial contribution by
the GOI, since this concession decreases the GOI's duty
8. West Bengal Incentive Scheme 1999 ('WBIS
revenue which would be otherwise due. In addition, the
1999')
duty reduction confers a benefit upon the exporter,
because the duties saved upon importation improve the
(a) Legal basis
company's liquidity.
(111) The detailed description of this scheme as applied by the
Government of West Bengal ('GOWB') is set out in
Notification No 580-CI/H of 22 June 1999 of the
(105) Furthermore, EPCGS is contingent in law upon export
GOWB Commerce & Industries Department.
performance, since such licences cannot be obtained
without a commitment to export. Therefore it is
deemed to be specific and countervailable under
Article 4(4), first subparagraph, point (a) of the basic
(b) Eligibility
Regulation.
(112) Companies setting up a new industrial establishment or
making a large-scale expansion of an existing industrial
establishment in backward areas are eligible to avail
(106) EPCGS cannot be considered a permissible duty
benefits under this scheme. Nevertheless, an exhaustive
drawback system or substitution drawback system
list of ineligible industries (negative list of industries)
within the meaning of Article 3(1)(a)(ii) of the basic
exists preventing companies in certain fields of oper
Regulation. Capital goods are not covered by the scope
ations from benefiting from the incentives.
of such permissible systems, as set out in Annex I point
(i), of the basic Regulation, because they are not
consumed in the production of the exported products.
(c) Practical implementation
(e) Calculation of the subsidy amount
(113) The State of West Bengal grants to eligible industrial
enterprises incentives in the form of a number of
(107) The subsidy amount was calculated, in accordance with
benefits, including an exemption of central sales tax
Article 7(3) of the basic Regulation, on the basis of the
('CST') and a remission of central value added tax
unpaid customs duty on imported capital goods spread
('CENVAT') on sales of finished goods, in order to
across a period which reflects the normal depreciation
encourage the industrial development of economically
period of such capital goods in the industry concerned.
backward areas within this State.
The amount so calculated, which is attributable to the
RIP, has been adjusted by adding interest during this
period in order to reflect the full value of the benefit
over time. The commercial interest rate during the inves
(114) Under this scheme, companies must invest in backward
tigation period in India was considered appropriate for
areas. These areas, which represent certain territorial units
this purpose. Where justified claims were made, fees
in West Bengal are classified according to their economic
necessarily incurred to obtain the subsidy were
development into different categories while at the same
deducted in accordance with Article 7(1)(a) of the basic
time there are developed areas excluded from the appli
Regulation.
cation of the incentive schemes. The main criteria to

establish the amount of the incentives are the size of
the investment and the area in which the enterprise is
or will be located.
(108) In accordance with Article 7(2) and 7(3) of the basic
Regulation, this subsidy amount has been allocated
over the appropriate export turnover during the RIP as
the appropriate denominator because the subsidy is
(115) It was found that one sampled company availed of this
contingent upon export performance and was not
scheme during the RIP.
granted by reference to the quantities manufactured,
produced, exported or transported.
(d) Conclusion
(109) The subsidy rate established with regard to this scheme
(116) This scheme provides subsidies within the meaning of
during the RIP for the sampled companies concerned
Articles 3(1)(a)(ii) and 3(2) of the basic Regulation. It
amounted to 0,55 % and 0,56 %, Respectively.
constitutes a financial contribution by the GOWB, since
the incentives granted, in the present CST exemption and
CENVAT remission on sales of finished goods, decrease
7. Advance Authorisation Scheme ('AAS')
tax revenue which would be otherwise due. In addition,
these incentives confer a benefit upon a company,
(110) It was found that only one sampled company availed of
because they improve its financial situation since taxes
this scheme during the RIP. However, the investigation
otherwise due are not paid.

---

L 137/12
EN
Official Journal of the European Union
23.5.2013
(117) Furthermore, this scheme is regionally specific in the
(123) The subsidy schemes give recurring benefits and there is
meaning of Articles 4(2)(a) and 4(3) of the basic Regu
no indication that these benefits will be phased out in the
lation since it is only available to certain companies
foreseeable future. Moreover, each exporter is eligible to
having invested within certain designated geographical
several of the subsidy schemes.
areas within the jurisdiction of the State concerned. It
is not available to companies located outside these
areas and, in addition, the level of benefit is differentiated
according to the area concerned.
(124) It was also examined whether exports to the Union
would be made in significant volumes should the
measures be lifted.
(118) The WBIS 1999 is therefore countervailable.
(125) India is a large producer of the product concerned. On
the basis of data collected during the investigation, India
(e) Calculation of the subsidy amount
had a production capacity of about 700 000-900 000
tonnes during the RIP and expansion plans bringing
(119) The subsidy amount was calculated on the basis of the
the total country capacity to 1 600 000 – 1 800 000
amount of the sales tax and CENVAT on sales of finished
tonnes by 2014. As a result, the excess of capacity
goods normally due during the review investigation
over domestic demand is estimated to reach about
period but which remained unpaid under this scheme.
600 000-700 000 tonnes in 2014, which would
In accordance with Article 7(2) of the basic Regulation,
represent 21-25 % of the total Union consumption
the amount of subsidy (numerator) have then been
during the RIP.
allocated over total sales during the review investigation
period as appropriate denominator, because the subsidy
is not export contingent and it was not granted by
reference to the quantities manufactured, produced,
(126) Under these circumstances, Indian producers of the
exported or transported. The subsidy rate obtained
product concerned are heavily dependent on export
amounted to 1,36 %.
sales and there is a likelihood that exports volumes to
the Union, which were already significant during the RIP,
would increase should the measures be repealed.
9. Amount of countervailable subsidies
(120) The amount of countervailable subsidies in accordance
(127) An exporting producer submitted that the excess capacity
with the provisions of the basic Regulation, expressed
would decrease after 2014 and therefore the excess
ad valorem, for the sampled exporting producers was
capacity situation would only be temporary. It is noted
7,53 % and 8,17 %, respectively.
that the alleged decrease of excess capacity after 2014
was found in line with the projections of the market
intelligence report. Therefore it was concluded that this
submission was not of a nature to modify the analysis
SCHEME DEPB DDS FMS SHIS EPCGS WBIS Total
with regard to the development of excess capacities.
COMPANY
%
%
%
%
%
%
%
Dhunseri
3,78 1,65 0,19 nil 0,55 1,36 7,53
(128) After the disclosure, an exporting producer claimed that
Petrochem &
important temporary excess capacities were inevitable
Tea Limited
due to the fact that generally production capacity
increases can be done only in large increments due to
Reliance
4,42 1,32 0,87 1,0 0,56 nil 8,17
the minimum size of modern PET plants. In reply to this
Industries
it should be noted that during RIP and the following
Limited
year, production capacity extensions in the range of at
least 150 000 to 200 000 tonnes were made. It follows
that the invoked reasoning cannot justify alone the excess
capacity available for exports quoted in recital (125). In
10. Conclusions on the likelihood of a continuation
any event, in this context the cause of the excess capacity
or recurrence of subsidisation
available for exports is irrelevant. Therefore the claim was
rejected.
(121) In accordance with Article 18(2) of the basic Regulation,
it was examined whether the expiry of the measures in
force would be likely to lead to a continuation or
recurrence of subsidisation.
(129) Some parties claimed that the excess capacity available
for exports developing in India could be absorbed also by
other third countries and that therefore the excess
capacity available for exports as calculated by the
(122) As set out under recitals (26) to (118) above, it was
Commission was not properly assessed. It was not
established that during the RIP Indian exporters of the
assume in any way that the entirety of any excess
product concerned continued to benefit from counter
capacity available for exports would be directed to the
vailable subsidisation by the Indian authorities.
Union. Therefore the claim was rejected.

---

EN
23.5.2013 Official
Journal
of
the
European
Union L
137/13
(130) In view of the above, it can be concluded that there is a
Eurostat and, concerning the non-cooperating Union
likelihood of a continuation of subsidisation.
producer, from estimations based on the review request.
D.
(138) After an initial increase in 2009 and 2010, the
DEFINITION OF THE UNION INDUSTRY
consumption showed a slight decrease of 2 % in the
Union production and Union industry
RIP as compared to 2008, totalling to 2,802 million
tonnes in the RIP.
(131) The like product is manufactured by 13 known
producers in the Union. They represent the Union
industry within the meaning of Articles 9(1) of the
Table 1
basic Regulation and will thereafter be referred as 'the
Union industry'.
Consumption
2008 2009 2010 RIP
(132) Twelve known Union producers, represented by the
Volume
complainant in the present case, cooperated and
(tonnes)
supported the investigation. One more known Union
producer did not cooperate in the present review.
Consum
2 868 775 2
934
283 2
919
404 2
802
066
ption
Index
100 102 102 98
(133) All available information concerning Union industry,
(2008 =
such as questionnaire replies, Eurostat and request for
100)
review, was used in order to establish the total Union
production for the RIP.
Source: Questionnaire replies, Eurostat and review request
(134) The Union market for PET is characterised by a relatively
2. Volume, market share and prices of imports from
high number of producers, belonging usually to bigger
India
groups with headquarters outside the Union. Between
(139) Despite the measures in place, the imports from India
2000 and 2012 the Union PET industry has undergone
more than doubled over the period considered departing
through several transitions. The market is in a process of
from 46 313 tonnes in 2008 and reaching 96 678
consolidation with a number of recent takeovers and
tonnes in the RIP.
closures. New products, such as recycled PET and bio
PET, continue to be developed together with a relatively
recent spinoff of a recycling industry.
(140) The market share of India rose accordingly from 1,6 % in
2008 to 3,5 % in the RIP, reaching a level significantly
above the market share established in the last expiry
(135) Following the disclosure some parties argued that the
review (0,3 %).
description of the situation of the Union industry was
inaccurate as five producers were in fact belonging to
one large transnational group and another three
(141) The average price stood at 1 285 EUR/tonne in the RIP.
producers were related to PET packaging companies.
This reflects a 22 % price increase over the period
None of these facts contradict the description provided
considered, which was acquired in the RIP after an
in recital (134) explicitly stating that the Union producers
initial decline of 21 % in 2009.
are usually belonging to bigger groups as disclosed. The
impact of this concentration is addressed in recital (207)
below. The assessment of the impact of captive market is
Table 2
analysed in recitals (202) to (204) below.
Imports from India
2008 2009 2010 RIP
(136) As indicated above, given the relatively high number of
cooperating Union producers a sample of four Union
Volume of imports 46 313 44
482 83
691 96
678
producers was selected, representing over 50 % of the
(tonnes)
production and sales of the total Union production of
the like product in the RIP.
Index (2008 = 100) 100 96 181 209
Average price 1
054 834 1
031 1
285
E. SITUATION ON THE UNION MARKET
Index (2008 = 100) 100 79 98 122
1. Union Consumption
Market share of 1,6 1,5 2,9 3,5
(137) Union consumption was established on the basis of the
imports (%)
sales volumes of the Union industry on the Union
Source: Eurostat
market, the import volumes data obtained from

---

L 137/14
EN
Official Journal of the European Union
23.5.2013
3. Imports from other third countries
(148) The average price amounted to 1 258 EUR/tonne in the
RIP, 5,5 % below the average unit price of the Union
(a) Imports from Thailand, Taiwan, Malaysia, Indonesia
industry. This reflects a 24 % increase over the period
considered which was acquired in the RIP after an
(142) As mentioned above, an anti-dumping expiry review
initial decline of 22 % in 2009.
concerning imports from India, Indonesia, Malaysia,
Taiwan and Thailand was conducted in parallel to the
present investigation.
Table 4
(143) Imports from Indonesia, Malaysia, Taiwan and Thailand
Imports from China, the UAE, Iran and Pakistan
increased by 56 % over the period considered despite a
decline of 59 % until 2010. Nevertheless, the total import
2008 2009 2010 RIP
volumes remained below de minimis level.
Volume of imports 235 913 351
798 188
776 72
054
from China, the
UAE, Iran and
(144) The respective market share increased accordingly from
Pakistan (tonnes)
0,7 % in 2008 to 1,1 % in the RIP.
Index
100 149 80 31
(2008 = 100)
(145) The average price amounted to 1 310/EUR/tonne in the
RIP, 1,5 % below the average unit price of the Union
industry. This reflects a 27 % price increase over the
Market share of
8,2 12,0 6,5 2,6
imports from
period considered, which was acquired in the RIP after
China, the UAE,
an initial decline of 18 % in 2009.
Iran and Pakistan
(%)
Table 3
Index
100 146 79 31
(2008 = 100)
Imports from Indonesia, Malaysia, Taiwan and Thailand
Price of imports
1 016 789 949 1
258
2008 2009 2010 RIP
(EUR/tonne)
Volume of imports from 19 078 12
127 7
762 29
836
Indonesia, Malaysia,
Index
100 78 93 124
Taiwan and Thailand
(2008 = 100)
(tonnes)
Source: Eurostat
Index (2008 = 100) 100 64 41 156
(c) Imports from other third countries without any measures
Market share of imports
0,7 0,4 0,3 1,1
(149) Volumes of imports from other third countries without
from Indonesia, Malaysia,
Taiwan and Thailand (%)
any measures including Oman, South Korea, Russia,
Mexico and Saudi Arabia increased by 59 % over the
period considered, after a growth of 71 % in 2009.
Index (2008 = 100) 100 62 40 160
Between 2009 and the RIP, Oman became the largest
exporting country in the Union.
Price of imports
1 030 843 1
055 1
310
(EUR/tonne)
Index (2008 = 100) 100 82 102 127
(150) The market share of the countries in question rose from
9,7 % in 2008 to 15,8 % in the RIP, mainly due to the
Source: Eurostat
gain of 4,3 % of imports from Oman. The market share
of South Korea stood at 4 % in the RIP, 5 % below its
highest level reached in 2009.
(b) Imports from China, United Arab Emirates (UAE), Iran
and Pakistan
(151) The average price amounted to 1 273 EUR/tonne, 4,3 %
(146) Imports from other third countries with anti-dumping
below the average unit price of the Union industry. This
measures in place decreased by 69 % over the period
reflects a 10 % increase over the period considered which
considered after an increase of 49 % in 2009. Only
was acquired in 2010 and in the RIP after an initial
imports from China remained stable.
decline of 24 % in 2009. The average price of imports
from Oman stood at 1 310 EUR/tonne in the RIP, 1,5 %
below the average unit price of the Union industry. The
(147) The market share of the countries in question decreased
average price of imports from South Korea stood at
from 8,2 % in 2008 to 2,6 % in the RIP, including
1 294 EUR/tonne, 2,7 % below the average unit price
mainly the UAE (1,7 % in RIP) and China (0,6 % in RIP).
of the Union industry.

---

EN
23.5.2013 Official
Journal
of
the
European
Union L
137/15
Table 5
at the level of the whole Union production for all
Union producers, on the basis of the information
Imports from other third countries
collected from the Union industry, the review
request as well as publicly-available statistics;
2008 2009 2010 RIP
Volume of
279 188 478
570 469
753 442
692
— micro-economic indicators (stocks, average unit
imports from
prices, wages, profitability, return on investments,
other third
cash flow, ability to raise capital and investments)
countries
was carried out for the sampled Union producers
(tonnes)
on the basis of the information they submitted.
Index
100 171 168 159
(2008 = 100)
(154) One sampled Union producer divested one of its
production facilities in June 2010. The latter was
Market share of
9,7 16,3 16,1 15,8
acquired by another Union producer. Since the analysis
imports from
of macro-economic indicators is based on data collected
other third
from all Union producers the divestment had no impact
countries (%)
on the scope or individual indicators of the injury
analysis.
Index
100 168 165 162
(2008 = 100)
(155) As a preliminary point to the analysis it should be
Price of imports
1 156 879 997 1
273
explained that certain global economic events in late
(EUR/tonne)
2010 and early 2011 had an impact on the situation
on the Union market, in particular on the prices and
Index
100 76 86 110
sales volumes of the like product. In this period the
(2008 = 100)
cotton supply fell resulting in an increased demand for
polyester fibre on the Asian market. PET and polyester
Main exporters (tonnes)
fibre are largely dependent upstream on the same raw
material, i.e. purified terephthalic acid (PTA). The
increased demand for polyester fibre resulted in insuf
Oman
0 52
632 95
646 120
286
ficient supply of PTA, pushing the prices of PET up.
Since the producers of PET in the Middle East also
South Korea 177
341 254
451 183
801 114
346
depend on PTA from Asia, this caused sudden fall in
imports of PET in the Union. At the same time, the
Russia 546 546
3 50
427
main PTA suppliers in the Union declared a 'force
majeure' resulting in additional restrictions of the
Mexico 2
650 1
879 29
039 29
409
domestic PET production.
Saudi Arabia 230 20
454 50
108 24
756
4.1. Comments of the parties
Others 98
422 148
609 111
156 103
468
(156) Some parties challenged the validity of the injury analysis
on the grounds that it was based on deficient
Source: Eurostat
information, which in turn also affected the rights of
defence of interested parties. In particular, the below-
mentioned arguments were raised.
4. Economic situation of the Union industry
(152) Pursuant to Article 8(4) of the basic Regulation all
(157) Some parties claimed that the information collected from
economic factors and indices having a bearing on the
Union producers did not comply with the instructions
state of the Union industry during the period considered
for completion of the questionnaire, which requested
have been examined.
data from different companies not to be aggregated. It

was therefore claimed that the collected information was
inaccurate and incomplete given that the reported figures
were aggregated per sampled entity. It is to be noted that
the information was duly collected and verified on-spot.
(153) For the purpose of the injury analysis, the injury indi
The information collected was found to provide suffi
cators have been established at the following two levels
ciently accurate picture of the Union industry and
therefore the above-mentioned claim had to be rejected.
Following disclosure the parties reiterated their claim. No
new arguments or evidence were presented. Same parties
— the macro-economic indicators (production,
reiterated their claim that the data provided by one
production capacity, capacity utilisation, sales
sampled company were incomplete as they did not
volume, market share, growth, employment, produc
relate to the entire group but selected entity within the
tivity, magnitude of subsidy margins and recovery
group. This comment was addressed at the sampling
from the effects of past subsidisation) were assessed
stage as explained in recital (18) above.

---

L 137/16
EN
Official Journal of the European Union
23.5.2013
(158) The same parties argued that the Commission attempted
seen in the context of the restructuring efforts of the
to fix the claimed insufficiencies of the collected
Union industry explained in recital (134) above.
information by sending additional questionnaires. In
this respect it should be clarified that the Commission
indeed sent additional questionnaires, but addressed them
Table 7
only to the non-sampled Union producers in order to
Production capacity and capacity utilisation
collect information on macro-economic indicators
relevant to the injury assessment therefore this was
done to supplement the information provided by the
2008 2009 2010 RIP
sampled Union producers. Following disclosure some
Production 3 118 060 2
720
326 2
625
244 2
393
516
parties reiterated the claim without bringing any new
capacity
arguments or presenting new evidence. The claim of
(tonnes)
the parties had to be therefore dismissed.
Index 100 87 84 77
(159) In addition, the same parties also claimed that the
Capacity
75 77 85 86
information provided by the sampled producers was
utilisation
contrary to the obligations in Article 29 of the basic
(%)
Regulation because information which was not
confidential in nature had been provided as confidential
Index
100 104 114 116
information and thus excluded from the open file. In this
(2008 =
respect it is to be noted that the information was clas
100)
sified as limited in line with the request of the submitting
Source: Questionnaire replies, review request
party. Upon the request of the parties the confidentiality
status of the submitted information was reconsidered
and, where appropriate, the information was reclassified
(c) Sales volume
as open for inspection by interested parties after approval
by the companies concerned. Also this claim was
(163) The sales volume of the Union industry on the Union
therefore dismissed.
market followed the same development as production,
with a contraction of 6 % over the period considered.
4.2. Macro-economic indicators
Table 8
(a) Production
Total sales of the Union industry in the Union
(160) In line with the loss of market share by the Union
industry (discussed in recital (164) below) the Union
2008 2009 2010 RIP
production decreased by 11 % between 2008 and the
RIP. The decline of the Union production was only inter
Sales
2 288 283 2
047
305 2
169
423 2
160
807
rupted in 2010 when it raised in comparison to 2009
(tonnes)
but remained nevertheless 4 % below its level of 2008. It
further decreased in the RIP.
Index
100 89 95 94
(2008 =
100)
Table 6
Source: Questionnaire replies, review request
Total Union production
(d) Market share
2008 2009 2010 RIP
(164) After an initial drop of 13 % in 2009, the Union industry
Production 2 327 169 2
107
792 2
239
313 2
068
717
(tonnes)
regained part of the market share lost by UAE, South
Korea, Iran and Pakistan despite increasing volumes of
imports from India, Oman and other third countries
Index
100 91 96 89
(Russia, Mexico and Saudi Arabia) over the same
(2008 =
100)
period. Overall, the market share of the Union industry
declined by 3 % during the period considered.
Source: Questionnaire replies, review request
Table 9
Union industry market share
(b) Production capacity and capacity utilisation
(161) The production capacity of the Union industry decreased
2008 2009 2010 RIP
by 23 % between 2008 and the RIP. This trend relates to
Union industry market
80 70 74 77
the closure of several manufacturing facilities which was
share (%)
partly offset by the launch of new factories.
Index (2008 = 100) 100 87 93 97
(162) Capacity utilisation increased from 75 % in 2008 to
Source: Questionnaire replies, review request and Eurostat
86 % in the RIP. Increased capacity utilisation is to be

---

EN
23.5.2013 Official
Journal
of
the
European
Union L
137/17
(e) Growth
(h) Recovery from the effects of past subsidisation
(165) The market stagnated over the period considered. There
(169) While the indicators examined above show an
was no growth for the Union industry to benefit from,
improvement in some economic indicators of the
on the contrary, despite the restructuring efforts, the
Union industry, further to the imposition of definitive
Union industry lost further market share to the
countervailing measures in 2001, they also provide
growing imports, in particular, from the countries
evidence that the Union industry is still vulnerable.
without any measures. The slight decline of the
consumption the RIP is to be seen against the back
ground of temporary shortage of the raw material
4.3. Micro-economic indicators
(PTA) in the Union as well as in the global market.
(a) Stocks
(170) The level of stocks was 24 % higher in the RIP in relation
(f) Employment and productivity
with their levels in 2008. However, the stocks have
remained at previously established levels in relation to
(166) The employment level of the Union industry showed a
the output, i.e. between 5 % and 6 %.
decrease of 41 % between 2008 and the RIP. The decline
was constant over the period concerned, including in
2010 when the production increased (see recital (160)
Table 11
above). In the light of the growing productivity, this drop
is a reflection of the restructuring efforts by a number of
Stocks
Union producers.
2008 2009 2010 RIP
Closing stocks 51
495 54
808 54
314 64
069
(167) Productivity of the Union industry's workforce, measured
as output (tonnes) per person employed per year,
Index (2008 = 100) 100 106 105 124
increased by 50 % in the period considered. This
reflects the fact that production decreased at a slower
Source: Questionnaire replies
pace than the employment level and is an indication of
increased efficiency of the Union industry. This is
particularly evident in 2010 when production increased
(b) Price development
while the employment level decreased and the produc
tivity was 37 % higher than in 2008.
(171) As regards the price development, after an initial drop in
2009 (– 16 %), mainly caused by the economic crisis, the
prices came close to 2008 level in 2010. This was
followed by a sharp rise of the average unit price in
Table 10
the RIP, bringing the increase over the period considered
to 25 %.
Employment and productivity
2008 2009 2010 RIP
(172) The sudden price increase in the RIP should be read in
the context of the unexpected market developments at
Number of employees 2
060 1
629 1
449 1
218
the end of 2010 and in the first quarter of 2011 on the
cotton market. As mentioned above (recital (155) above),
Index 100 79 70 59
the record cotton prices caused a switch to polyester
fibre that competes for the same raw material as PET.
Productivity (tonne/
1 130 1
294 1
545 1
698
The increased demand for the raw material, in particular,
employee)
PTA, pushed up the prices of PET in Asia and Middle
East with a spill over effect on the prices of PET in the
Index (2008 = 100) 100 115 137 150
Union. The price increase in the Union at that time was
further amplified by the short term scarcity of PTA in the
Source: Questionnaire replies, review request
Union due to the declared force majeure of one of the PTA
producers in the Union.
(g) Magnitude of the actual margin of subsidy
Table 12
(168) As concerns the impact on the Union industry of the
Unit Sales Price in the Union
magnitude of the actual margin of subsidy of Indian
imports, given the price sensitivity of the market for
2008 2009 2010 RIP
this product, this impact cannot be considered to be
negligible. It should be noted that this indicator is
Unit Sales Price in the 1 066 891 1
045 1
330
more relevant in the context of the likelihood of
Union (EUR/tonne)
recurrence of injury analysis. Should measures lapse, it
is likely that subsidised imports would come back at such
Index (2008 = 100) 100 84 98 125
volumes and prices that the impact of the magnitude of
Source: Questionnaire replies
the subsidy margin would be significant.

---

L 137/18
EN
Official Journal of the European Union
23.5.2013
(c) Factors affecting sales prices
ability appears closely correlated to the improvements in
capacity utilisation and to the productivity gains observed
(173) The sales prices of PET normally follow the price trends
above.
of its main raw materials (mainly PTA and monoethylene
glycol — MEG) as they constitute up to 90 % of the total
cost of PET. PTA is an oil derivative, the price of which
(177) Thanks to the global market developments at the break
fluctuates on the basis of the price of crude oil. This
of 2010/2011, coupled with the restructuring efforts and
causes high volatility of the prices of PET.
efficiency gains described above, the Union industry was
able to improve its profitability in 2010 and to reach the
level of 5,3 % in the RIP.
(174) In addition, PET competes for the same raw material with
polyester fibre, the production of which relies to the
same extent as PET on the availability of PTA. Since
(178) One interested party argued that this development was
polyester fibre is an alternative to cotton for the textile
unexpected and extraordinary, not to be considered
industry, the price of PET is therefore also sensitive to the
representative of the overall situation of the Union
developments on the cotton market.
industry.
(179) In this respect it is to be noted that the Union industry
(d) Wages
was able to benefit from the PET price increase at the
(175) The average wages declined by 7 % over the period
end of 2011 and beginning of 2012 as it had fixed the
considered. This reduction occurred in the RIP and
PTA price before the described market events occurred.
amplified the productivity gains observed above (see
Based on the statistical sources concerning the post-RIP
recital (167) above).
development, submitted by the parties, the profit margins
of PET producers went substantially down in 2012. This
confirms that the profitability in 2011 (RIP) was indeed
Table 13
largely influenced by unexpected and temporary global
economic events (recital (155)) that are unlikely to recur
Wages
and cannot be considered permanent and representative
of the situation of the Union industry.
2008 2009 2010 RIP
Wages (average per
54 512 56
014 54
876 50
784
Table 14
person)
Profitability and Return on Investments
Index (2008 = 100) 100 103 101 93
2008 2009 2010 RIP
Source: Questionnaire replies
Profitability Union sales (%) –
7,9 1,6 4,8 5,3
(e) Profitability and return on investment
Index 100 221 261 267
(176) The profitability and returns on investment improved
Return on investment (%) –
9,6 2,3 8,9 10,6
significantly between 2008 and the RIP. The profit on
sales in the Union market increased from – 7,9 % in
Index (2008 = 100) 100 224 292 310
2008 to 5,3 % in the RIP, while return on investment
improved from – 9,6 % to 10,6 %. The year 2008 was
Source: Questionnaire replies
affected by the particularly poor performance of one
Union producer. Nevertheless, the improvement of the
(f) Cash flow and ability to raise capital
financial situation of the Union industry in 2009 and
2010, when prices were below their 2008 levels,
(180) The cash flows improved significantly over the period
evidences the loose relationship between prices and
considered reflecting the recent improvement of the
profitability. On the contrary, the improvement of profit
profitability of the Union Industry.
Table 15
Cash flow
2008 2009 2010 RIP
Cash flow (EUR) –
59
419
394 40
940
883 96
614
649
103 761 169
Index (2008 = 100) 100 269 363 375
In % of turnover –
5,9 4,5 8,3 7,5
Index (2008 = 100) 100 176 242 229
Source: Questionnaire replies

---

EN
23.5.2013 Official
Journal
of
the
European
Union L
137/19
(181) There were no particular indications that the Union
(187) Following the disclosure some parties contested the
industry would have encountered difficulties in raising
conclusion that the Union industry was still fragile
capital, mainly as the Union producers are incorporated
claiming that the Union industry was in a healthy state
in larger groups.
and has substantially transformed since 1999. It is noted
that as explained above (recital (184)), despite the overall
improvement and consolidation, not all economic indi
(g) Investments
cators developed positively over the period considered.
For example, production and sales volumes as well as
(182) The level of investments was overall reduced by 35 %
market share decreased. Moreover, the improvements
over the period considered. The initial investments
were relatively recent and with a fall of profitability in
made in 2008 were cut sharply in 2009 and have not
2012 appeared short-lived. On this basis it was
fully recovered since.
considered that while no material injury proved to exist
in RIP, the Union industry was still in a fragile state. The
argument was therefore rejected.
Table 16
Investments
2008 2009 2010 RIP
(188) Following the disclosure some parties contested the use
of data referring to period beyond RIP for the analysis of
Investments 72 341 598 5 404 705 15 994 659 47 217 003
the economic situation of the Union industry. In
(EUR '000)
response to this claim it is confirmed that the situation
of the Union industry was assessed for the period
Index (2008
100
7 22 65
considered and on this basis no material injury was
= 100)
established. However, the development of profitability
of the Union industry beyond RIP is in this case
Source: Questionnaire replies
relevant mainly in the context of the extraordinary
nature of the global market developments at the break
of 2010/2011. It also illustrates the volatility typical for
this sector. The argument is therefore rejected.
5. Conclusion on the situation of the Union industry
(183) The analysis of the macro-economic data showed that
the Union industry decreased its production and sales
volumes during the period considered. The Union
F. LIKELIHOOD OF RECURRENCE OF INJURY
industry's market share has not fully recovered since
the initial drop in 2009 and it showed an overall
1. Impact of the projected volume of imports and
decrease of 3 percentage points over the period
price effects in case of repeal of measures
considered (to 77 % in RIP). The decline in employment
and capacity is a result of the on-going restructuring and
(189) The investigation has shown that the imports from India
is to be seen in the context of increasing capacity utili
continued to be subsidised and that there are no indi
sation and productivity.
cations that the subsidisation would be reduced or
discontinued in the future.
(184) At the same time most of the relevant micro-economic
indicators showed signs of improvements. The profit
ability, return on investment and cash flow rose signifi
(190) A prospective analysis of the likely import volumes in
cantly, in particular in 2010 and in the RIP. The invest
the Union from India revealed that, given the excess
ments, on the other hand, plummeted in 2009 and have
capacity available for exports (see recital (125) above),
not recovered since.
the price levels in the Union and the attractiveness of
the Union market, the imports from India are likely to
increase to levels above those reached in the RIP, if the
(185) Overall, the economic situation of the industry has
measures were repealed. With the planned capacity
improved. However, these improvements are relatively
expansions, the excess capacity available for exports is
recent and to some extent based on unforeseen and
estimated to reach about 600 000-700 000 tonnes in
temporary market developments at the break of
the near future, which would represent around 21-25 %
2010/2011 (see recital (155) above). This appears to be
of the total Union consumption in RIP.
supported by the information available on the devel
opments of the margin of the Union industry in 2012
(see recital (179) above) that show a decline as compared
to RIP.
(191) Given the continuation of subsidisation, the prices of
imports from India are expected to further decrease,
(186) In view of the above analysis, the situation of the Union
should the measures against India be lifted. Also, as the
industry has improved and no material injury appears to
exporters will have to compete against low priced
be taking place. Nevertheless, despite apparent positive
imports from other countries, they are likely to lower
trends and the significant restructuring efforts, the
their prices further in order to increase market share
situation of the Union industry is still fragile.
on the Union market.

---

L 137/20
EN
Official Journal of the European Union
23.5.2013
(192) On this basis, the Union industry is likely to be exposed
4. Attractiveness of the Union market
to substantial volumes of imports from India at
subsidised prices below the average prices of the Union
(198) The Union PET market is attractive in terms of its size
industry, undermining the recently improved economic
and prices, being the third largest market in the world,
situation of the latter. As a result, the material injury is
with a structural need for imports and higher prices as
likely to recur should the measures against India be lifted.
compared to other markets. In the case of India, the
import prices to the Union tend to be higher than the
prices to other third countries, which points to the
attractiveness of the Union market for the Indian
2. Production capacity and excess capacity available
exports. This is well illustrated by the fact that the
for exports
imports from India have doubled over the period
(193) As indicated above (see recital (125) above), the
considered despite the measures in force.
exporting producers in India have the potential to
increase their export volumes to the Union market.
India had a significant growth in its production
capacity over the period considered (see recital (125)
(199) The attractiveness of the Union market for exporters is
above). According to the information available it is
also confirmed by the fact that the Union industry
expected to increase its capacity further, creating a gap
continued to lose market share to the rising imports
between domestic consumption and production capacity
from the countries without measures. This is in particular
available for exports of 600 000-700 000 tonnes in the
true in the case of South Korea that significantly
near future. Such excess capacity available for exports has
increased its exports to the Union market in 2012
to be considered as significant as it represents around 21-
after the measures against the country have expired.
25 % of the current Union consumption in RIP.
5. Other factors
(194) Therefore, although the imports to the Union were
relatively low, they more than doubled over the period
(200) The impact of the imports from other third countries
considered and there is a risk that significant exports
with measures on the situation of the Union industry
from India could be diverted to the Union.
was not considered significant, due to the relevant low
import volumes and substantial decrease of their market
share in the RIP.
3. Loss of export markets
(195) Trade defence measures are currently in place against
Indian imports in Turkey and South Africa. The
(201) The volume of imports from other third countries
consequent possible loss of these export markets for
without any measures increased during the period
India is another indicator that the Union market is
considered, however, the respective average import
likely to be targeted if the measures were allowed to
price remained close to the Union industry average
lapse.
price. Therefore, the impact of the imports from these
countries on the situation of the Union industry is
considered limited.
(196) Following the disclosure some parties contested the
conclusions regarding the loss of export markets for
India. It was claimed that both markets were marginal
export market, therefore no significant export volumes
6. Captive market
from these markets could be redirected to the Union if
(202) Following the disclosure some parties claimed that due to
the measures were lifted. It is noted that only the
the vertical integration between PET producers and
existence of the trade defence on some markets
converters, a considerable part of PET was sold for
excludes any meaningful comparison of the relative
captive use that did not compete with imports. It was
importance of the markets with and without measures
also claimed that share of captive market was significant,
for a given country. In addition, contrary to the claim, it
affecting the results of the analysis.
was not considered that the export volumes from India
placed on these markets would be redirected to the
Union market. Instead, it was considered that the
existence of the trade defence measures on other third
(203) Based on the information collected at the level of
markets restricts the absorption capacity of third markets
sampled Union producers the proportion of captive
as regards the foreseen increase in excess capacities
sales was found not to be significant (below 10 %). It
available for exports in India. This argument was
has to be underlined that the parties in question
therefore rejected.
expressed the presence of PET producers in the
packaging business in terms of the installed production
capacity of PET and not in terms of their market share in
(197) The existence of trade defence measures in third
packaging. Therefore, the claim on significant proportion
countries is also an indication that the pricing
of captive use was found unsubstantiated. As regards the
behaviour of Indian exports is likely to replicate on the
price levels, the prices of related and unrelated sales were
Union market.
found to be within the same range.

---

EN
23.5.2013 Official
Journal
of
the
European
Union L
137/21
(204) On these grounds it was concluded that the distinctive
producers, it is noted that the Union market is an open
analysis of the impact of captive sales was not necessary
market with other eight producers operating outside this
and the claims of the parties were rejected.
group and growing competition of imports from third
countries – with and without any measures in place.
Secondly, concentration is typical for this type of
7. Comments of the parties
business based on commodity product that relies on
economies of scale for its competitiveness. Thirdly, no
(205) Some parties argued that the injury due to imports from
price leader was found to exist on the Union market.
India did not exist during the RIP as evidenced by the
Finally, parties reiterated that the impact of the imports
relative economic health and profits of the Union
from the three countries concerned in the light of the
industry. It has to be note that, indeed, no continuation
vertical integration of some Union producers with the
of injury has been established in the present case, and
packaging industry or with producers of PTA was not
therefore the claim of the parties corresponds to the
analysed. As established in recital (205) above these
investigation findings.
aspects were indeed analysed and found unsubstantiated.
Moreover, the verification of companies concerned by
vertical integration with producers of raw materials
confirmed there was no comparative advantage as the
(206) Some parties claimed that other factors, such as
transfers were made at market price. Based on the
structural inefficiencies of the Union industry and lack
above, the claim that the Union industry would be
of investment as well as seasonal and conjunctural
shielded from the competition was rejected.
factors (e.g. bad weather, economic crises) could have
an impact on the situation of the Union industry.
Concerning the first point raised, it is to be noted that
the restructuring of the Union industry is already taking
(209) Last, some parties argued that no elements support a
place and the efficiency gains obtained suggest that the
conclusion that the Indian export capacity may target
claim of the parties are unfounded. As to the
the Union market at 'cheap prices' given that (i) the
conjunctural factors, although the economic crises did
domestic demand in India is growing and is expected
have an impact on the situation of the Union industry
to continue to grow; (ii) PET in excess of domestic
in 2009, as mentioned above (recital (171) above), the
consumption exists, yet competition in export markets
relevant effects do not appear to be currently present
has not resulted in exports at abnormally low prices; (iii)
anymore. Concerning the effect of bad weather, this
increases in production capacity in Asia responds to the
could partly explain the shrinking consumption in the
increase in demand expected worldwide. It is to be noted
RIP, however, on the one hand, its alleged impact on
that the findings in the present investigation demonstrate
the situation of the Union industry has not been
that the projected growth of capacity shows a growing
substantiated and, on the other hand, the slight drop in
excess of the production capacity over domestic demand.
2011 appears to be rather linked to temporary scarcity
In addition, the Indian prices on third markets were
of raw materials due to the global market developments
lower as compared to the Indian imports prices to the
in 2011. Therefore, none of these claims is justified in
Union. Based on the findings described above in recitals
view of the findings of the investigation.
(189) to (199) it is likely that the subsidised Indian
imports will target the Union market at substantial
volumes and below the average price of the Union
(207) Furthermore, some parties argued that the recurrence of
industry should the countervailing measures be allowed
injury in this case is unlikely if the measures were to
to lapse. On these grounds the arguments of the parties
expire, given that thanks to its structure (concentration
are dismissed.
and vertical integration) the Union industry is shielded
from the effects of the imports. Moreover, it has been
argued that a shift to imported PET is neither desired nor
possible in the near future, in particular as purchasing
8. Conclusion on the recurrence of injury
contracts and policies as well as homologation process of
large brand owners (downstream users) makes changes of
(210) On the basis of the foregoing it is concluded that it is
PET suppliers cumbersome. It is to be noted that based
likely that substantial volumes of subsidised import from
on the findings of the investigation the Union industry
India would be redirected to the Union should the
continued to lose market share to the benefit of imports
countervailing measures be repealed. Thanks to the
during the period considered; this shows, on the one
continued subsidisation, the prices of the imports
hand, that the Union industry is not shielded from the
would most likely undercut the Union industry prices.
effects of the imports and, on the other hand, that the
Also, the prices of these imports are likely to decrease
switch to imports is not hypothetical but is actually
even further should the Indian exporting producers try to
already taking place. The arguments had to be therefore
increase their market shares. This would in all likelihood
dismissed.
have the effect of reinforcing the price pressure on the

Union industry, with an expected negative impact on its
situation.
(208) Following the disclosure some parties reiterated the claim
that the Union industry was shielded from the potential
competition of imports due to its structure. Firstly, as
(211) During the period considered the situation of the Union
regards the claim on dominant position of one of the
industry improved, in particular in terms of productivity
producing groups in the Union market controlling five
and capacity utilisation as well as profit margins that

---

L 137/22
EN
Official Journal of the European Union
23.5.2013
has reached in the RIP a level close to the target profit
2. Interest of unrelated importers in the Union
established in the original investigation. It can therefore
be concluded that the Union industry, albeit still in a
(217) None of the unrelated importers cooperated in the
fragile situation, did not suffer material injury during
present review. Despite the measures in force the
the RIP. However, given the likely substantial increase
imports from India continued and nearly doubled over
of subsidised imports from India, which are likely to
the period considered.
undercut the Union industry's sales prices, it is
concluded that the situation would very likely deteriorate
and the material injury would recur, should measures be
allowed to lapse.
(218) The imports from other third countries without any
measures were also available and reached significant
market share during the RIP (see recital (149) above).
Therefore, even with the measures in place, importers
G. UNION INTEREST
had access to alternative sources of supply.
(212) In accordance with Article 31 of the basic Regulation, it
was examined whether the maintenance of the existing
countervailing measures would be against the interest of
the Union as a whole. The determination of the Union
(219) Bearing in mind that there is no evidence suggesting that
interest was based on an appreciation of all the various
the measures in force considerably affected importers, it
interests involved. All interested parties were given the
is concluded that the continuation of measures will not
opportunity to make their views known pursuant to
be against the interest of the Union importers.
Article 31(2) of the basic Regulation.
3. Interest of the suppliers of the raw materials in
(213) It should be recalled that the adoption of measures was
the Union
considered not to be against the interest of the Union
neither in the original investigation nor in the last expiry
(220) The raw material for the manufacturing of the product
review. Furthermore, the analysis in the last expiry review
concerned is PTA/MEG. Two out of five known suppliers
was carried out in the situation where the measures had
of raw material (one supplier of PTA and one of MEG)
been already in place and thus the assessment took into
cooperated with the investigation by submitting the ques
account any undue negative impact on the parties
tionnaire reply. Both suppliers of the raw material
concerned by the measures in question.
expressed their support for the continuation of the
measures.
(214) On this basis, it was examined whether despite the
conclusions on the continuation of subsidisation and
(221) The investigation showed that the cooperating PTA
likelihood of recurrence of injury, any compelling
producer represented a substantial part of the PTA
reasons existed which would lead to the conclusion
purchases of the sampled Union producers in the RIP.
that it is not in the Union interest to maintain
Given that PTA has no other use in the Union than the
measures in this particular case.
production of PET, it is reasonable to assume that PTA
producers are largely dependent on the PET industry.
1. Interest of the Union industry
(215) The continuation of the countervailing measures on
(222) As to the cooperating MEG supplier, MEG represented
imports from India would help the Union industry to
relatively small part of its total turnover in the RIP. With
continue the on-going restructuring and enhance its
regard to MEG, PET is not its only or major possible
only recently improved economic situation, as it would
application and MEG producers are less dependent on
help avoiding that the Union industry is exposed to the
the situation of the PET industry. Consequently, it is
substantial volumes of subsidized imports from India,
considered that the continuation of measures against
which the Union industry could not withstand. The
subsidised imports of PET from India would have a
Union industry would therefore continue to benefit
positive, although likely limited, impact on the
from the maintenance of the current countervailing
suppliers of MEG.
measures.
(223) It was alleged that the suppliers of raw material do not
(216) Accordingly, it is concluded that the maintenance of
depend on the Union producers of PET; in particular, as
countervailing measures against India would be in the
it was argued that two out of four sampled Union
interest of the Union industry.
producers were in fact importing the raw materials.

---

EN
23.5.2013 Official
Journal
of
the
European
Union L
137/23
(224) In relation to this claim the investigation has shown that
(230) Since the recycling industry did not come forward in this
the imported material was predominantly MEG that can
investigation, none of the above-mentioned allegations
also be used for other than PET applications. No indi
could have been verified against the actual figures.
cations were gathered showing more than negligible
Therefore, it is considered that in overall the measures
imports of PTA to the Union. Therefore, this claim
in force would not be against the interest of the recycling
does not affect the conclusions taken as regards the
industry in the Union.
dependency of PTA producers on PET production in
the Union.
5. Interest of the users
(225) Consequently, it is considered that the continuation of
measures against subsidised imports of PET from India
(231) The product concerned is predominantly used to produce
would benefit the PTA producers and also, although to a
bottles for water and other soft drinks. Its use for the
lesser extent, the MEG suppliers. As a consequence the
production of other packages (foodstuff, sheets, etc.)
continuation of measures against imports from India
remains relatively limited. Bottles of PET are produced
would not be against the interest of the raw material
in two stages: (i) first a pre-form is made by mould
suppliers.
injection of PET, and (ii) later the pre-form is heated
and blown into a bottle. Bottle making can be an inte
grated process (i.e. the same company buys PET,
produces a pre-form and blows it into the bottle) or
(226) Following the disclosure some parties claimed that PTA
limited to the second stage (blowing the pre-form into
was exported and therefore the PTA producers were
a bottle). Pre-forms can be relatively easily transported as
claimed not to be dependent on Union industry. No
they are small and dense, while empty bottles are
evidence supporting this claim was presented. Therefore
unstable and due to their size very expensive to
the argument of the parties was dismissed as unsub
transport.
stantiated.
(227) Moreover, the same parties claimed that lifting the
(232) On this basis, two main groups of downstream users
measures will not have any impact on the PTA
have been established for studying of the impact of the
producers as the cooperating users will allegedly not
measures in force: (i) converters and/or bottle makers,
switch to imports and will continue to source PET
converting PET chips into pre-forms (or bottles) and
from the Union industry. Therefore, the level of PTA
selling them for downstream processing; and (ii)
consumption in the Union will remain the same. Based
bottlers, filling (and blowing) the bottles out of pre-
on the findings of the investigation the Union industry
form; this group represents mostly the producers of
continued to lose market share to the benefit of imports
mineral water and soft drinks. The bottlers are often
during the period considered. This shows that the switch
involved in the PET business either via integrated bottle
to imports is not hypothetical (see recital (164) above).
making operations or via tolling agreements with
The argument of the parties was therefore dismissed.
subcontracted converters and/or bottle makers for
whom they negotiate the PET price with the producer
(soft tolling) or even buy the PET for their own bottles
4. Interest of PET recycling industry
(hard tolling).

(228) The Union industry argued that the situation of the
recycling industry depends on the sustainable price of
virgin PET (non-recycled PET) on the Union market.
(233) Seventeen (five converters and twelve bottlers)
Their claim was substantiated by a press release of an
cooperated in the investigation and provided information
association of plastic recyclers in Europe, according to
collected by the questionnaire. The cooperating
which a potential lifting of the measures on virgin PET
converters represented 22,7 % and bottlers 13 % of the
could further worsen the situation of the recycling
total consumption of PET in the Union. The replies of
industry.
bottlers came from various branches of the multinational
companies (known as brand-owners).
(229) Some interested parties contested that the situation of the
recycling industry depends on the sustainable price of
virgin PET on the Union market arguing that the prices
(234) It has been established that the cooperating users sourced
of virgin PET and recycled PET were unrelated. It was
PET predominantly from the Union producers and only a
claimed that recycled PET is mainly used for the
small proportion was sourced from imports. The imports
production of polyester fibre and therefore cannot be
from India represented roughly half of these imports and
linked to the price developments of virgin PET. In
thus a minimal proportion of the sourced PET. Never
addition, it was noted that the recycled PET is entirely
theless, the imports from other third countries without
supported by bottle-fillers and thus the industry does not
any measures were also available and reached significant
depend on PET producers. Finally, it was also noted that
market share during the RIP (see recital (149) above).
recycling industry did not come forward as an interested
Therefore, even with the measures in place, the users
party in the present investigation.
had access to alternative sources of supply.

---

L 137/24
EN
Official Journal of the European Union
23.5.2013
6. Arguments of the users' industry
the claimed negative impact of the measures in question
on some converters is therefore considered to be
(235) Users claimed to be significantly affected by substantial
marginal.
increases in the price of PET in recent years which
cannot be transferred to retailers and consumers in the
current economic environment. It is claimed that these
price increases have resulted from accumulation of many
(239) As regards the PET price impact on bottlers, based on the
years of application of trade defence measures, which
reported figures, the PET is estimated to represent on a
have protected the Union producers from the
weighted average basis 9 % of total costs of bottled soft
competition of imports at the time when the Union
drinks and 12 % of the total costs of bottled mineral
PET industry became more concentrated and integrated.
water. This shows that PET is not the main cost
As a result, the users claimed that the measures in place,
component for the bottling industry.
through their alleged impact on the price of PET, are
responsible for the deterioration of the downstream
industry's employment, R&D and competitiveness on
export markets, with a more acute impact on SMEs. It
(240) In addition, the investigation has established that PET
was also claimed that the job losses due to the measures
was the preferred although not the exclusive packaging
in force exceeded the number of people currently
material of bottlers. PET products represented 75 % of
employed by the Union PET industry.
the turnover of water bottlers and 50
% of the
turnover of producers of soft drinks. Furthermore, the
investigation showed that contracts between many large
bottlers (brand owners) and PET producers were based
on a formula whereby the price was adjusted to reflect
6.1. Price sensitivity and cost structure of the users
fluctuation of prices of raw materials for PET. This
confirms the existing negotiating power of the large
(236) As regards the PET price sensitivity of converters, PET
was found to represent around 80 % of the total costs.
and thus the most representative bottlers over the
PET is therefore considered a critical cost component for
conversion margin of the PET producers.
this type of activity. In addition, the converters' industry
was found to be rather fragmented with a relatively weak
negotiating position against large bottlers and inherent
structural problems typical for the commodity based
(241) Following the disclosure some users reiterated their
argument that PET is a basic cost component for
industry. As a result, this sector showed an increasing
converters, soft drink and bottled water industries and
tendency to vertical integration with bottlers and the
the findings in this respect were inaccurate and not
use of tolling agreements on the basis of which the
based on the reported data. It is noted that the
conversion fees are guaranteed and the PET price is ulti
situation of converters was analysed separately and this
mately negotiated and paid by the bottlers. It is estimated
comment is in their case unfounded (see recital (236)
that substantial part of PET purchases on the Union
above). As regards the assessment of the situation of
market is controlled directly by the large bottlers. Since
the bottlers it is confirmed that the cost ratios established
the contracts for pre-forms often include a mechanism
in the investigation are based on the figures reported by
for reflecting the variation of PET prices, the convertors
the cooperating bottlers following a methodology
are increasingly neutral towards the developments of PET
available to all parties. The established cost ratios were
prices.
in line with the findings of previous investigations
concerning the same product concerned ( 1 ). The claims
of the parties were therefore considered unsubstantiated.
(237) Following the disclosure some users contested the
conclusion on the increased use of tolling and price
formulas. The information in the file confirmed
(242) Following the disclosure some users claimed that the
existence of such trend. The claim was therefore
essence of the company specific data and information
dismissed.
provided by them was not reflected in the analysis of
the Union interest. It is confirmed that the data was
used as reported by the users in their questionnaire
replies. The calculation methodology was made
available to all parties concerned. On this ground the
(238) It was claimed that the measures in place would not
claim was rejected.
cause damage to the converters, if similar measures
were applied on imports of preforms into the Union. It
was argued that in the areas close to the Union border
with third countries, in which there are no measures
(243) The investigation has also established that based on the
against imports of PET from India, there are incentives
expected and/or desired decrease of PET prices estimated
to delocalise the production of preforms and import
by the verified bottlers themselves, if the measures would
them free of countervailing measures on PET into the
result in negligible cost reduction for the bottlers. Based
Union. It is acknowledged that to some extent there is
on these estimates of PET price decrease and the
an economic rationale for this process to be happening.
However, given the transportation cost, the delocalisation
( 1 ) E.g. Commission Regulation (EU) No 473/2010 (OJ L 134,
is likely to occur only within limited distances. In overall,
1.6.2010, p. 25); Council Regulation (EC) No 192/2007.

---

EN
23.5.2013 Official
Journal
of
the
European
Union L
137/25
established cost ratios, the respective cost reduction was
margins on the PET in the Union that are due to the
calculated to be within the range of 0,3-0,7 % of the total
existence of the measures in question has to be rejected.
costs of the bottlers for their PET-related activities.
(248) Following the disclosure some parties reiterated their
(244) Following the disclosure some users disputed this
argument that the prices in the Union were unjustifiably
conclusion arguing that any saving in costs would be
high reflecting the impact of accumulation of anti-
significant. Some users put forward new estimates in
dumping measures operating in a market with concen
their submissions without providing any new evidence.
tration among Union producers, vertical integration and
It is emphasised that the prospective savings are hypo
limited production unable to satisfy the consumption. It
thetical, as was also admitted by some users themselves.
was also claimed that the price data also showed that the
As regards the converters, no quantification of pros
higher prices in the Union are not reflecting the higher
pective saving was put forward for this segment. As
costs of raw materials. It is noted that the arguments on
regards the bottlers, it was considered that should the
concentration, vertical integration and production
alleged PET price decrease materialise, in the light of
capacity of Union industry were addressed in recitals
the costs structure of the bottlers, saving within 0,3 %-
(207) and (259) respectively. As regards the claimed
0,7 % of total costs cannot be considered 'significant'.
impact of these factors on the PET price in the Union
Since no new evidence was provided, the claim was
it is recalled that the PET price development is driven by
dismissed as unsubstantiated.
the price of raw materials that account for up to 90 % of
cost of PET (see recital (173) above). Also, the increase in
PET prices in 2010/2011 was a worldwide phenomenon
(see recital (172) above). The claims of the parties were
(245) It was claimed that some bottled-water producers have
inherent vulnerabilities stemming from legal
therefore unsubstantiated.
requirements imposed for the source water to be
bottled at the source and limited extraction volumes.
The sector is being dominated by SMEs, which has an
(249) As regards the argument concerning the gap between the
impact on the cost structure of the companies in ques
Union PET price and prices in Asia and US, and in
tions. Also, variations have been observed in the price
addition to findings already stated in recital (244)
levels of final products across Member States depending
above, it was found that the difference in prices
on the purchasing power of the local population. On
between US and Union market was volatile, yet
these grounds it is considered that the impact of an
moderate. Union prices were not systematically higher
eventual decrease of PET prices, if the measures were
as claimed. Union and Asian market were found to be
lifted, would be more pronounced for this part of the
very different in terms of cost structures linked in
bottling industry.
particular to the size of the market and economies of
scale, access to the raw materials and capacity. Therefore,
comparing the average prices between these two markets
6.2. Alleged premium prices and profits of Union industry
was not meaningful. The argument of the parties was

therefore found unsubstantiated.
(246) Some parties alleged the existence of premium prices and
premium margins practised by PET producers in the
Union, claiming that these would be at the origin of
(250) Also, some parties claimed that the prices in the Union
the price increases in 2011. This claim was also
reflect a higher spread over the cost of raw materials as
supported by the comparison made between PET prices
compared to US or Asia. The comparison of spreads
and spread over the raw materials in the Union to the
follows the same logic as comparison on prices on
situation on Asian market and in the USA. It was
various regional markets with the difference that the
claimed that this situation results from the accumulation
variations of prices of raw materials between various
of trade remedies.
regional markets are accounted for. Nevertheless, the
existing structural differences between the markets can
justify the difference in conversion fees. The extra
(247) It is to be noted that the increase of the prices of PET in
ordinary profits made by Union industry at the break
2011, as well as its decline in 2009, was a worldwide
of 2010/2011 were explained in recital (179) above. In
phenomenon driven by the evolution of the cost of raw
none of the situations the measures were found to play a
materials (see recital (155)). Data submitted by the parties
role. Therefore the argument of the parties was rejected.
systematically showed a very close correlation between
the evolution of PET prices in Europe, Asia and the USA.
Nevertheless, there are indeed differences in the prices of
(251) The same parties also claimed that the largest producer in
PET across the world which are related to various
the Union charged higher prices in the Union than on
reasons, in particular, the specific cost structure in each
other markets and recorder higher revenues in 2010 in
region,. As regards the argument on existing premium
the Union than elsewhere. In this context, it is considered
margin in the Union, it is noted that even under excep
that it is economically justifiable that a transnational
tional circumstances in late 2010 and beginning of 2011
company would have different cost structures and thus
the Union industry has merely reached the profitability
different prices on different regional markets. The excep
considered reasonable for this type of industry. No
tional profitability levels at the break of 2010/2011 were
evidence of premium profit was found. Therefore, the
explained in recital (179) above. On these grounds the
argument on existing 'premium' prices and 'premium'
argument was rejected.

---

L 137/26
EN
Official Journal of the European Union
23.5.2013
6.3. Economic situation of users and claimed impact of the
(255) As regards the alleged erosion of the competitiveness of
measures
the exports of the Union producers of bottled mineral
water/soft drinks, this claim was neither substantiated,
(252) Further claims were made as regards the worsening
nor has a link to the existence of the measures in
economic situation of the user's industry, such as
place been in this context demonstrated.
closing facilities and reducing employment. It was
alleged that this was the result of the PET price
increase. In addition, it was claimed that the competi
tiveness of European leading brands has been eroded as
their exports in third countries were in direct
competition with bottled-products that benefit from
(256) Following the disclosure the parties reiterated that the
PET at international prices.
rising PET prices have a negative impact on the competi
tiveness of exports of bottled water. It is recognised that
the PET price increase, among other things, can have a
negative impact on the competitiveness of exports of
bottled water. Nevertheless, since no link between the
(253) It should be noted, that based on the information
PET price increase and the measures in question was
submitted by the cooperating users, the users segment
found as the PET prices primarily derive from the
was not found to be loss-making even though there
prices of raw materials, the claimed impact of the
was a decline in the overall profitability level in RIP.
measures on the eroded competitiveness was rejected.
The profit margin of the users' industry established on
the basis of the questionnaire replies according to the
methodology made available to all parties was found to
be at similar level as the profitability established for the
Union industry in RIP. The two verified companies
(257) Finally, as to the claimed effect of the measures on the
(bottlers) reported further expansions in production
employment, the investigation revealed that the verified
volumes and increased profitability over the period
job losses of the users industry were predominantly
considered. Some converters were found operating on
linked to the productivity and efficiency gains and a
tight margins, in some cases facing structural and
part concerned the reduction of the temporary staff.
financial difficulties. However, no direct the link with
the measures in place could have been established in
this respect. Similarly, certain decline in the economic
situation of the bottlers was linked to the squeeze
caused in 2011 by the sudden increase of PET price
that could have not been passed on to retailers under
(258) Following the disclosure some parties disputed this
the current economic downturn. However, while it has
finding on the grounds that it did not reflect the
been established that the situation of the users industry
situation of the entire sector. In addition to the
deteriorated to certain extent in 2011, the link between
findings described in recital (254) above, it is noted
the decline and the existence of the measures was not
that total jobs reported by the converters significantly
demonstrated, especially given that the measures were in
increased and none of them reported job losses.
places since 2000.
Bottlers claimed job losses as a result of increased PET
price. However, the increase in PET price being a
worldwide phenomenon, no link between job losses
and the measures was established. Furthermore, 90 %
of the job losses reported by the users' questionnaires
(254) Following the disclosure some parties disagreed with the
replies were concentrated on three companies. One of
conclusion that the users' industry was not loss making.
them, a verified user representing substantial part of
The parties also claimed that the profit margins of users
the reported job losses, increased substantially its
were lower than those of the Union industry. As regards
volumes over the period considered and such losses are
the assessment of profitability of the users' industry, the
therefore associated to productivity gains. As for the
information collected from the cooperating users contra
remaining two companies, they were found to have the
dicted this claim. The methodology was made available
profitability margins among the highest of the
to the parties. Although some cooperating users could
cooperating parties in their segment and above the
have been loss making, the user's industry was overall
target profit of the Union industry in this case. The
found to be profitable. In any event, if the increase of
claims were therefore dismissed.
PET prices was found to be one element affecting the
profitability of the users, no link between the measures
and the profitability of the companies in question was
demonstrated. As regards the comparison of profit
margins of users and the Union industry, this claim
6.4. Other arguments
was not substantiated. Due to the volatility of the profit
ability of the Union industry (see recitals (176) to (179)
(259) Following the disclosure some parties argued that the
above) the comparison between the two segments was
Union producers do not have sufficient capacities to
not considered conclusive. In any event, the both
meet the existing demand. It is noted that the Union
segments showed similar profitability levels during the
industry operated at 86 % of its production capacity in
RIP (see recital (253). In this light, the comments of
RIP and has sufficient spare capacity to cover total
the parties were rejected as unsubstantiated.
domestic consumption of PET. In addition, imports

---

EN
23.5.2013 Official
Journal
of
the
European
Union L
137/27
from other countries with and without measures
in the total cost of the bottlers was found to be limited.
continue to exist and have an increasing tendency.
Furthermore, no link between the PET price variations
Also, the current measures expired in case of South
and the measures was demonstrated. On these grounds,
Korea and are lifted for imports of the product
the measures were found not have disproportionate effect
concerned from Malaysia and Indonesia. In addition,
on the users.
PET recycling industry may constitute further source of
PET to cover the PET demand in the Union. For these
reasons, the alleged problems faced by users due to the
(265) Taking into account all of the factors outlined above, it
claimed insufficient production in the Union were not
cannot be clearly concluded that it is not in the Union
considered substantiated.
interest to maintain the current countervailing measures.
(260) Following the disclosure some users claimed the analysis
H. COUNTERVAILING MEASURES
did not address the claimed adverse impact of the
accumulation of measures on the product concerned
(266) All parties were informed of the essential facts and
under the present review. In response to this argument
considerations on the basis of which it was intended to
it is noted that the countervailing measures merely
recommend that the existing measures be maintained.
remedy the injurious effect of established subsidisation.
They were also granted a period within which they
The existence of the claimed 'accumulated' effect was not
could make representations subsequent to this disclosure.
demonstrated. On the contrary, despite the measures in
The submissions and comments were duly taken into
place, the imports from countries with measures
consideration, where warranted.
continue and their volumes even increased during the
period considered. Also, imports from countries
without any measures are available with a growing
(267) On the basis of the above analyses the countervailing
trend and at substantial volumes. The argument of the
measures applicable to imports of PET originating in
parties was therefore dismissed.
India should be maintained in compliance with
Article 18(1) of the basic Regulation. It is recalled that
these measures consist of specific duties.
7. Conclusion on the Union interest
(261) To conclude, it is expected that the extension of the
(268) The individual company countervailing duty rates
countervailing measures on imports from India would
specified in this Regulation are solely applicable to
provide an opportunity for the Union industry to
imports of the product concerned produced by these
improve and to stabilise its economic situation
companies and thus by the specific legal entities
following the investments and consolidation made in
mentioned. Imports of the product concerned manu
the recent years.
factured by any other company not specifically
mentioned in Article 1(2) of this Regulation with its
name and address, including entities related to those
specifically mentioned, cannot benefit from these rates
(262) It is also considered that an improved economic situation
and shall be subject to the duty rate applicable to 'all
of the Union industry may be in the interest of PTA
other companies'.
producers and, to a lesser extent, MEG producers in

the Union.
(269) Any claim requesting the application of these individual
countervailing duty rates (e.g. following a change in the
(263) The economic situation of some users has worsened
name of the entity or following the setting up of new
since the last review and in particular smaller bottle-
production or sales entities) should be addressed to the
water producers were found, among other reasons, to
Commission forthwith with all relevant information, in
be negatively affected, especially it seems, by the recent
particular any modification in the company's activities
PET price increase since they were unable to pass it on to
linked to production, domestic and export sales
retailers under the current economic climate. However,
associated with, for instance, that name change or that
the exceptional price and margin developments of Union
change in the production and sales entities. If appro
industry in 2011 were found to be a global phenomenon
priate, the Regulation will then be accordingly amended
primarily driven by the increase in the prices of raw
by updating the list of companies benefiting from indi
materials. Therefore, the allegations on existing
vidual duty rates.
'premium' prices and 'premium' margins linked to
existence of the measures in question were found unjus
tified. At the same time, Union market continues to be
(270) In order to ensure proper enforcement of the counter
an open market with existing alternative sources of
vailing duty, the residual duty level should not only apply
supply from other third countries without any measures.
to non-cooperating exporters but also apply to those
companies which did not have any exports during the
RIP. However, the latter companies are invited, when
(264) Against this background, no link between the PET price
they fulfil the requirements of article 20 of the basic
increase and the existing measures was demonstrated.
regulation, to present a request for a review pursuant
Economic situation of converters was found to be
to that Article in order to have their situation
stable despite the measures in force. The weight of PET
examined individually,

---

L 137/28
EN
Official Journal of the European Union
23.5.2013
HAS ADOPTED THIS REGULATION:
the implementation of Council Regulation (EEC) No 2913/92
establishing the Community Customs Code ( 1 ), the amount of
countervailing duty, calculated on the basis of the amounts set
Article 1
above, shall be reduced by a percentage which corresponds to
the apportioning of the price actually paid or payable.
1. A
definitive
countervailing
duty
is
hereby
imposed
on
imports of polyethylene terephthalate having a viscosity
number of 78 ml/g or higher, according to ISO Standard
4. Notwithstanding
paragraphs
1
and
2,
the
definitive
1628-5, currently falling within CN code 3907 60 20 and orig
countervailing duty shall not apply to imports released for
inating in India.
free circulation in accordance with Article 2.
2. The
rate
of
the
definitive
countervailing
duty
applicable
to
5. Unless
otherwise
specified,
the
provisions
in
force
the product described in paragraph 1 and manufactured by the
concerning customs duties shall apply.
companies listed below shall be as follows:
Article 2
Counter-
TARIC
Country Company
vailing duty
additional
1. Imports
shall
be
exempt
from
the
countervailing
duties
(EUR/tonne)
code
imposed by Article 1 provided that they are produced and
directly exported (i.e. invoiced and shipped) to a company
India Reliance
Industries
Ltd 90,4 A181
acting as an importer in the Union by the companies whose
names are listed in Decision 2000/745/EC, as from time to time
India Pearl
Engineering
Polymers 74,6 A182
amended, declared under the appropriate TARIC additional code
Ltd
and that the conditions set out in paragraph 2 are met.
India Senpet
Ltd 22,0 A183
2. When the request for release for free circulation is pres
India Futura
Polyesters
Ltd
0 A184
ented, exemption from the duties shall be conditional upon
presentation to the customs authorities of the Member State
India Dhunseri
Petrochem
&
Tea
106,5 A585
concerned of a valid Undertaking Invoice issued by the
Limited
exporting companies from which undertakings are accepted,
containing the essential elements listed in the Annex.
India All
other
companies 69,4 A999
Exemption from the duty shall further be conditional on the
goods declared and presented to customs corresponding
precisely to the description on the Undertaking Invoice.
3. In
cases
where
goods
have
been
damaged
before
entry
into free circulation and, therefore, the price actually paid or
Article 3
payable is apportioned for the determination of the customs
value pursuant to Article 145 of Commission Regulation
This Regulation shall enter into force on the day following its
(EEC) No 2454/93 of 2 July 1993 laying down provisions for
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, 21 May 2013.
For the Council
The President
E. GILMORE
( 1 ) OJ L 253, 11.10.1993, p. 1.

---

EN
23.5.2013 Official
Journal
of
the
European
Union L
137/29
ANNEX
Elements to be indicated in the Undertaking Invoice referred to in Article 2(2):
1. The Undertaking Invoice number.
2. The TARIC additional code under which the goods on the invoice may be customs-cleared at Union borders.
3. The exact description of the goods, including:
— the product reporting code number (PRC) (as established in the undertaking offered by the producing exporter in
question),
— CN code,
— quantity (to be given in units).
4. The description of the terms of the sale, including:
— price per unit,
— the applicable payment terms,
— the applicable delivery terms,
— total discounts and rebates.
5. Name of the company acting as an importer to which the invoice is issued directly by the company.
6. The name of the official of the company that has issued the undertaking invoice and the following signed declaration:
‘I, the undersigned, certify that the sale for direct export to the European Union of the goods covered by this invoice is
being made within the scope and under the terms of the undertaking offered by … (name of company), and accepted
by the European Commission through Decision 2000/745/EC. I declare that the information provided in this invoice
is complete and correct.’

---

Document Outline

• �

---