Commission Implementing Regulation (EU) 2018/1690 of 9 November 2018 imposing definitive countervailing duties on imports of certain pneumatic tyres, new or retreaded, of rubber, of a kind used for buses or lorries and with a load index exceeding 121 originating in the People's Republic of China and amending Commission Implementing Regulation (EU) 2018/1579 imposing a definitive anti-dumping duty and collecting definitively the provisional duty imposed on imports of certain pneumatic tyres, new or retreaded, of rubber, of a kind used for buses or lorries, with a load index exceeding 121 originating in the People's Republic of China and repealing Implementing Regulation (EU) 2018/163

Published date12 November 2018
Subject Matterdumping
Official Gazette PublicationJournal officiel de l'Union européenne, L 283, 12 novembre 2018,Gazzetta ufficiale dell'Unione europea, L 283, 12 novembre 2018
L_2018283EN.01000101.xml
12.11.2018 EN Official Journal of the European Union L 283/1

COMMISSION IMPLEMENTING REGULATION (EU) 2018/1690

of 9 November 2018

imposing definitive countervailing duties on imports of certain pneumatic tyres, new or retreaded, of rubber, of a kind used for buses or lorries and with a load index exceeding 121 originating in the People's Republic of China and amending Commission Implementing Regulation (EU) 2018/1579 imposing a definitive anti-dumping duty and collecting definitively the provisional duty imposed on imports of certain pneumatic tyres, new or retreaded, of rubber, of a kind used for buses or lorries, with a load index exceeding 121 originating in the People's Republic of China and repealing Implementing Regulation (EU) 2018/163

THE EUROPEAN COMMISSION,

Having regard to the Treaty on the Functioning of the European Union,

Having regard to Regulation (EU) 2016/1037 of the European Parliament and of the Council of 8 June 2016 on protection against subsidised imports from countries not members of the European Union (‘the basic Regulation’) (1), and in particular Articles 15 and 24(1) thereof,

Whereas:

1. PROCEDURE

1.1. Initiation

(1) On 14 October 2017, the European Commission (‘the Commission’) initiated an anti-subsidy investigation with regard to imports into the Union of certain new and retreaded tyres of a kind used on buses or lorries and with a load index exceeding 121, originating in the People's Republic of China (‘the PRC’ or ‘the country concerned’). The initiation was based on Article 10 of the basic Regulation. It published a Notice of Initiation in the Official Journal of the European Union (‘Notice of Initiation’) (2).
(2) The Commission initiated the investigation following a complaint lodged on 30 August 2017 by the Coalition against unfair tyres imports (‘the complainant’) on behalf of Union producers representing more than 25 % of the total Union production of certain new and retreaded tyres of a kind used on buses or lorries and with a load index exceeding 121 (‘TBR tyres’). The complaint contained evidence of subsidisation and of a resulting injury that was sufficient to justify the initiation of the investigation.
(3) Prior to the initiation of the anti-subsidy investigation, the Commission notified the Government of China (‘GOC’) (3) that it had received a properly documented complaint, and invited the GOC for consultations in accordance with Article 10(7) of the basic Regulation. Consultations were held on 10 October 2017, but no mutually agreed solution could be reached.
(4) On 7 May 2018, the Commission imposed a provisional anti-dumping duty on imports of the same product originating in the PRC (4) (‘the provisional anti-dumping Regulation’) in an investigation which had been initiated on 11 August 2017 (5) (‘the parallel anti-dumping investigation’). On 22 October 2018, the Commission imposed a definitive anti-dumping duty on imports of the same product originating in the PRC (6) (‘the definitive anti-dumping Regulation’) in the parallel anti-dumping investigation. The injury, causation and Union interest analyses performed in the present anti-subsidy investigation and the parallel anti-dumping investigation are mutatis mutandis identical, since the definition of the Union industry, the sampled Union producers and the investigation period are the same in both investigations. All the relevant elements pertaining to these aspects have been taken into account also in the present investigation.

1.1.1. Comments concerning initiation

(5) The GOC claimed that the investigation should not be initiated because the complaint did not satisfy the evidentiary requirements of Articles 11(2) and 11(3) of the WTO Agreement on Subsidies and Countervailing Measures and of Article 10(2) of the Basic Regulation. According to the GOC, there was insufficient evidence of countervailable subsidies, injury and a causal link between the subsidised imports and the injury.
(6) The Commission rejected that claim. The evidence submitted in the complaint constituted the information reasonably available to the complainant at that stage. It was sufficient to show, at initiation stage, that the alleged subsidies were countervailable in terms of their existence, amount and nature. The complaint also contained sufficient evidence of the existence of injury to the Union industry, which was caused by the subsidised imports.
(7) Contrary to what was claimed by the GOC, the complaint did not only rely on the tyre industry policy in 2010, but also contained (in particular in points 81 to 92), a number of other policy documents, plans and catalogues with references to the tyre industry. Moreover, the Commission (where appropriate) relied on other available sources to confirm the alleged subsidisation. For example, given that the US authorities had recently made public determinations on some of the measures, the Commission also relied on this material already at this stage. Moreover, the Commission found it useful to include a reference to a new industrial promotion plan of the Hebei province of 2016, which it had on file, but was not mentioned in the complaint. This additional evidence, which is available in the non-confidential file of the case as part of the memorandum on sufficiency of evidence, further confirmed and complemented the allegations made in the complaint as regards the existence and nature of the alleged subsidisation. Insofar as the GOC pointed to any deficiencies with respect to the accuracy and adequacy of the complaint, the Commission examined these allegations during the investigation, and found no reason to question the allegations about the existence and extent of subsidisation when initiating the investigation.
(8) Following final disclosure, Hämmerling claimed that the Commission cannot initiate an investigation with a general reference to CN codes given for information only. According to Hämmerling, although the CN codes are not binding in their interpretation, such a general reference defining product concerned cannot be accepted, as it impairs the legal certainty of all of the interested parties, concerning whether they will fall within the scope of the investigation and constitutes a direct breach of Article 41 of the Charter of Fundamental Rights of the European Union (hereinafter ‘Charter’) and the right to good administration. Moreover, such a reference and unclear language referring to ‘of a kind used’ convey the message that the scope of the investigation was uncertain and could have been further discretionally extended or narrowed, at the later stage of the investigation, which impairs the right to be heard of interested parties.
(9) In regard to this claim, the Commission found that the party did not substantiate its theoretical claim how the use of CN codes impair legal certainty. The Commission is not bound by the CN codes but by the product definition as stated in the Notice of Initiation. The party made no claims that the Commission did not respect the product definition as stated in the Notice of Initiation. Therefore this claim was rejected.

1.2. Registration of imports

(10) The complainant submitted requests for registration of imports of the product concerned originating in the PRC pursuant to Article 14(5) of the basic anti-dumping Regulation and Article 24(5) of the basic Regulation on 19 August 2017 and on 5 October 2017 respectively.
(11) On 4 October 2017, the China Rubber Industry Association (‘CRIA’) and the China Chamber of Commerce of Metals, Minerals & Chemicals Importers & Exporters (‘CCCMC’) submitted comments on the request for registration. They claimed that the request had failed to satisfy the applicable evidentiary standard as there was no evidence of a history of dumping/subsidy, a substantial rise in imports and that the imports are likely to seriously undermine the remedial effects of the duty. On 19 October 2017, the Commission held a hearing at the request of CRIA during which it reiterated its earlier comments.
(12) On 2 February 2018, the Commission published Implementing Regulation (EU) 2018/163 (‘the registration Regulation’) (7) making imports of the product concerned originating in the PRC subject to registration as of 3 February 2018 onwards. The Commission took into account comments by interested parties when assessing the validity of the request for registration.
(13) After the registration entered into force Hankook Group (8) claimed that its rights of defence were violated as no information regarding the Commission's intention to make imports of the product concerned subject to registration had been communicated to it before the entry into force of the registration Regulation. For that reason the Hankook Group claimed that there was a breach of Article 41 of the Charter of Fundamental Rights of the European Union.
(14) The Commission observed that prior disclosure is mandatory under Article 30(2) of the basic Regulation before the imposition of definitive measures. The same does not apply to a registration Regulation under Article 24(5) of the basic Regulation. That Article only provides for the prior information to Member States in due time. Moreover, the right to be heard under Article 41(2)(a) of the Charter of Fundamental Rights of the European Union only applies to individual adverse measures. In this case, the Commission directed the Union customs authorities to register imports. The registration Regulation is not an individual measure affecting the Hankook Group adversely. It was neither addressed to the Hankook Group nor did it produce individual negative effects for that group. In this respect, it should also be recalled that the registration of
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