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MINISTRY OF COMMERCE AND INDUSTRY

(Department of Commerce)

NOTIFICATION

New Delhi, the 12th December, 2001

Subject:—Anti-Dumping Duties concern in g imports into India by Poly-Iso-Butylene originating in or exported from

European Union, Brazil, Japan, Korea RP, Singapore and Thailand—Preliminary Findings

No. 47/1/2001-DGAD.—Having regard to the Customs Tariff Act 1975 as

amended in 1995 ana the Customs Tariff (Identification, Assessment and

Collection of Anti-Dumping Duty on Dumped Articles and for Determination

of Injury) Rules, 1995, thereof

PROCEDURE:

The procedure described below has been followed with regard to the

investigations:-

(i)

The Designated Authority (hereinafter referred to as Authority), under Rules,

received written application from M/s. Kothari Sugars & Chemicals Limited,

Manali, Chennai alleging dumping of Poly-Iso-Butylene (hereinafter referred

to as subject goods), originating in or exported from European Union, Brazil,

Japan, Korea RP, Singapore and

Thailand (hereinafter referred to as

subject countries).

(ii)

The Authority, on the basis of sufficient evidence submitted by the

petitioner, decided to initiate investigations against imports of Poly-Iso-

Butylene from the subject countries. The Authority

notified

the

Embassies/High Commissions of subject countries about the receipt of

dumping allegation before proceeding to initiate

investigations in

accordance with sub-rule 5(5) of the Rules;

(iii)

The Authority issued a Public Notice dated the 12^th

September, 2001,

published in the Gazette of India, Extraordinary, initiating Anti-Dumping

investigations concerning imports of Poly-Iso-Butylene originating in or

exported from the subject countrlies, classified under Custom sub-headings

3902.20 under Chapter 39 of the Customs Tariff Act, 1975.

(iv)

The Authority forwarded a'copy of the Public Notice to the known exporters

(whose details were made available by the petitioners) and industry

associations and gave them an opportunity to make their views known in

writing in accordance with Rule 6(2);

(v)

The Authority forwarded a copy of the Public Notice to the known importers

of subject goods in India (whose details were made available by the

petitioners) and advised them to make their views known in writing within

forty days from the date of the letter;

(vi)

Request was made to the Central Board of Excise and Customs (CBEC) to

arrange

details of imports of subject goods for the past three years,

including the period of investigations;

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(vii)

The Authority provided a copy of the petition to known exporters and the

Embassies/High Commissions of the subject countries in accordance with

Rules 6(3) supra.

(viii) The Authority sent questionnaire, to elicit relevant information, to the known

exporters from subject countries as mentioned below in accordance with the

rule 6(4):-

• M/s BP Chemicals Ltd., Scotland.

• M/s DAELIM Corporation, Seoul, Korea.

• M/s Exxon Chemical Companies, New Jersey, USA

• M/s Idemitsu Petrochemicals Corporation Limited, Japan.

• M/s BP Chemicals SNC, Paris La Defense.

• M/s Exxon Chemical, Singapore.

• M/s BASF, Germany.

• M/s Exxon Mobil Singapore Pte. Ltd., Singapore.

The response was, however,, filed by the following exporters of subject

goods:

• M/s BASF, Germany.

• M/s DAELIM Corporation, Seoul, Korea.

(ix)

The Embassies/High Commissions of the subject countries in New Delhi

were informed about the initiation of the investigations in accordance with

Rule 6(2) with a request to advise the exporters/producers from their

country to respond to the questionnaire within the prescribed time A copy

of the letter, petition and questionnaire sent to the exporter was also sent to

the Embassies/High Commissions of subject countries along with a list of

known exporters/ producers.

P.nntd

3/_

(x)

A questionnaire was sent to the following known importers and Consumers

of subject goods in India calling for necessary information in accordance

with Rule 6(4):-

• M/s. Bharat Sheet Limited, Maharashtra.

• M/s. Gulf Oil India Limited Dadara Nagar Haveli.

• M/s. Bharat Petroleum Corporation Limited, Mumbai.

• M/s. IBP Company Limited, Calcutta.

• M/s. Indian Additives Limited, Manali, Chennai.

• M/s. Lubrizol India Limited, Thane

• M/s. Hindustan Petroleum Corporation Limited, West Bengal.

• M/s. Castrol India Limited, Mumbai

• M/s. Pennzoil Quaker State India Limited, Navi Mumbai.

• M/s. Maharashtra Polybutenes Limited, Navi Mumbai.

• M/s. Gujarat Polysynthese Limited, Vadodara.

• M/s. Cochin Refinery Balmer Lawrie Limited, Kerala.

• M/s. Indian Oil Corporation Limited, Mumbai.

The response was, however, filed by the following importers / consumers of

subject goods:

• M/s. Lubrizol India Limited, Thane.

• M/s. Indian Additives Limited, Manali, Chennai.

(xi)

Additional information regarding injury parameters including cost of

production was sought from the petitioner, which was also received;

(xii)

The Authority made available non-confidential version of the evidence

presented by various interested parties in the form of a public file kept

open for inspection by the interested parties;

(xiii) Optimum cost of production and cost to make and sell the subject goods in

India based on the information furnished by the petitioner on the basis of

Generally Accepted Accounting Principles(GAAP) was worked out so as to

ascertain if Anti-Dumping duty lower than the dumping margin would be

sufficient to remove injury to Domestic Industry;

(xiv)

**** in this Notification represents information furnished by the petitioner on

confidential basis and so considered by Authoritv under the Rules;

(xvi) Investigation was carried out for the period starting from 1^st April, 2000 to

31^st August, 2001.

PETITIONER'S VIEWS:

The petitioners have raised the following issues:-

(a)

The imports of

Poly-lso-Butylene

from the subject countries have

increased significantly in absolute terms.

The volume of imports in the

current year by Indian Oil Corporation Ltd. alone would be 2700 MTs

considering the prices quoted by the exporters;

(b)

The export price

from the subject countries have declined significantly.

Further decline in export price in US$(which is more relevant for the

exporters) is much more significant than Indian Rupees. M/s. Indian Oil

Corporation Ltd. has recently floated International tender for procurement of

the product at three places in India, viz. Trombay, Chennai and Calcutta

The prices quoted by these exporters in these tenders are at significantly

reduced levels which cannot permit recovery of cost of production for any

producer of the product in these countries.

(c)

The selling price of the Domestic Industry which was increasing till

2000-

01 reduced significantly in 2001-02. Moreover increase in the selling price

in 2000-01 over 1999-2000 was much lower than increase in the cost of

production resulting in significant financial losses to the Domestic Industry .

THE GAZETTE OF INDIA: EXTRAORDINARY

IP ucr 1—SB . 11

(d)

The dumped imports are causing severe price undercutting to the Domestic

Industry in the market. The price which exporter have quoted recently in

the tender do not permit recovery of even cost of production, leave alone

profit.

The quotations by the exporters have resulted in severe price

suppression/ depression in the Indian market.

The Domestic Industry

would loss substantial sales given the price quoted by the exporters in the

recently floated tenders.

(e)

The Domestic Industry has been forced to reduce the prices below the cost

of production as a result of significant dumping in the country

The

financial situation of the Domestic Industry has deteriorated significantly.

The Domestic Industry has been forced to a situation of significant financial

losses from a situation of profit.

VIEWS OF EXPORTERS. IMPORTERS AND OTHER INTERESTED

PARTIES:

EXPORTERS' VIEWS

(I)

M/S. BASF AKTIENGESELLSCHAFT. GERMANY:

M/s. BASF Aktiengesellschaft, Germany has submitted that the product

produced by the complainant is not a like product in sense of the GATT Anti

Dumping Codex.

The quality of the BASF product is different and the

imported product can not be substituted by the locally produced. This fact

will be demonstrated by their customer M/s Indian Additives Limited (ILA),

who imports exclusively the BASF product into India. There is a contract

between Chevron Oronite and BASF, which makes no price differentiation

concerning the final destination. By such a contract dumping is not possible

because Chevron Oronite buys for the EU market as well.

(ii)

M/S. DAELIM INDUSTRIAL CO.. LTD.. KOREA.

M/s. DAELIM has made the following submissions :-

(a)

ON STANDING OF THE PETITIONER:

There are four Poly-lso-Butylene plants in India and the petitioner

M/s. Kothari Chemical Ltd. alone does not represent more that 25%

of the production of the subject goods and does not

have the

standing to file the petition.

(b)

ON INJURY:

(i)

The imports have increased dramatically since the beginning of 2000

even though the import tax is high at the range of 35%. They have

the competitive advantage, the economic of scale, and the quality of

product and there own

Poly-lso-Butylene technology over the

producers of India. The production cost of their Poly-lso-Butylene is

lower than Indian producers so they could get awarding of tender

business.

(ii)

Although the petitioner claims tnat imported goods has caused injury

to the domestic industry,

Daelim Poly-lso-Butylene makes a

contribution to the

protection of

Indian Air Pollution and Indian

lubricants oil manufacturers including main importers

(iii)

Although NAPTHA price has dramatically increased between 1999

and 2000 fiscal

year, Indian domestic and international Poly-lso-

Butylene price has not increased because of supply surplus around

the world. Loss of the petitioner was not caused by imported goods

as they also suffered from the same situation in the market.

(c)

TARIFF CLASSIFICATION:

Poly-lso-Butylene, is classified as 3902.20 and as 3902.90 as well

under the Customs Tariff Act., which is the same as Korean HS

Code. We always

export Poly-lso-Butylene to foreign country by

using 3902.90. Generally the price of Poly-lso-Butylene is lower than

average price of all products of 3902.20 because the price of HRPIB

and Semi-Solid PI B is more expensive.

Poly-lso-Butylene under

3902.20 can be divided into three kinds of P IB as follows:

PRODUCTS

PIB

HRPIB

Semi-Sold PIB

Properties

Liquid, Low Mw

High Reactive P IB

Rubbery Phase, High Mw.

The petitioner's claim needs to be confirmed including volume,

price and normal value based on imports into European Union in

the petition. Our data indicates that export volume to India is 2,267

MT, whereas the

petitioner claims just 1,377 MT in the

investigation period.

VIEWS OF OTHER INTERESTED PARTIES

M/S INDIAN PETROCHEMICALS

CORPORATION LIMITED (IPCL).

GUJARAT.

M/s IPCL one of the manufacturers of the subject goods, while supporting

the petition have stated that imports of Poly-lso-Butylene have increased

significantly in the past few years. The imports are so low price that at

indigenous price of feedstock and conversion cost their margins are at

great stress. In the recent tenders floated by Indian Oil Corporation ,

exporters have quoted significantly lower price, which if they are forced to

match,

their

margins will be eroded to such extent that viability of

business will be questionable. The dumping is resulting in significant injury

to the Indian industry. The situation demands immediate imposition of anti

dumping duty on dumped imports from subject countries.

THE GAZETTE OF INDIA: EXTRAORDINARY

| PART T—SEC. 1J

(ii)

M/S. KOCHI REFINERIES LIMITED:

M/s. Kochi Refineries Limited , one of the manufacturers of the subject

goods in the country, has supported the anti dumping petition filed by

M/s. Kothari

Sugar

and Chemicals Limited.

In response to the

questionnaire they have submitted the cost details and has made the

following submissions:-

(a)

Due to dumping of the product by the foreign agencies on the

Indian market they had to reduce their prices, far below the cost of

production so as to match the landed price of the imported product

to sustain operation of the plant. They had to drastically cut down

the price to match with the prices offered by the foreign venders in

the tenders floated by major marketing company in India.

(b)

In the financial year 2000-2001 they made

a net loss of about

Rs.**** crores against a total turn over of approximately Rs. ****

crores.

They are selling the subject goods below the total cost of

production due to severe market pressures.

VIEWS OF IMPORTERS:

(i)

M/S. INDIAN ADDITIVES LIMITED. CHENNAI:

M/s. Indian Additives Limited has submitted that they were using

conventional

Poly-lso-Butylene (P IB) until the end of the year 1999.

Now they have substituted it with another product HRPIB (highly reactive

Poly-lso-Butylene) due to better economy and quality of manufacture

products.

Although HRPIB is entirely different in terms of technology,

physio chemical property and uses, the customs tariff classification is

same

as of conventional Poly-lso-Butylene manufactured by the

petitioner company. HRPIB is neither manufactured in India nor/any one

has the technology. Therefore, they have requested for excluding HRPIB

from the purview of the current anti dumping investigation as it is a

different product and any way does not

affect the indigenous

manufacturers including the petitioner company. However the importer

has not submitted complete details as per the prescribed Questionnaire.

(ii)

M/S LUBRI20L INDIA PVT.. LTD:

M/s Lubrizol has intimated that they have not imported the subject goods

during the Period of Investigation. However they have stated that they do

not support the case of levy of Anti Dumping Duty on Poly-lso-Butylene for

the following reasons

(a) There is a surplus capacity available in the international market and

the prices internationally are extremely competitive, The present import

price of Polybutenes by local consumers is the right competitive

international price. Due to large petroleum feed stock

becoming

surplus due to the shift in the product made/market internationally,

the feed stock import to Polybutenes will be further cheaper which will

lower the prices over a period.

(b) One of the largest suppliers of Polybutenes i.e. M/s.

Indian

Petrochemicals Corporation Ltd. (Govt, of India undertaking) has not

come up which such case for anti dumping.

When any anti dumping

duty is considered by the Government it is voice of the industry that is

being looked into but with the overriding fact kept in mind that such

actions should not put the consumer/public at disadvantage.

EXAMINATION OF THE ISSUES RAISED:

The submissions made by the exporters, importers, petitioner and other

interested parties have been examined, considered and have been dealt

with at appropriate places hereinafter.

PRODUCT UNDER CONSIDERATION:

7. (a) The product involved in the present petition is Poly-lso-Butylene also

known as PIB or Poly-lso- Butene (also referred as subject goods

hereinafter) originating in or exported from European Union, Brazil, Japan,

Korea RP, Singapore and Thailand.

Poly-lso-Butylene is a Synthetic

Hydrocarbon Polymer manufactured by polymerisation of C4 Olefins

stream consisting mainly Isobutene. Poly-lso-Butylene finds application in

various fields like Lube Oil additives, Cable Filling Compounds, Rubber

Modifiers, Leather Chemicals, 2T Oil Formulations, Oil Insulators

Adhesives etc, Present investigation covers

all forms of Poly-lso-

Butylene.

(b) Poly-lso-Butylene is classified under Customs sub heading No. 3902.20

under Chapter 39 of the Customs Tariff Act, 1975.

THE GAZETTE OF INDIA: EXTRAORDINARY

[PART I—SF.C 11

the

scope of the present investigation.

LIKE ARTICLES:

Rule 2(d) of the Anti-Dumping Rules specifies that "Like Articles" means

an Article which is identical or alike in all respects to the product under

investigation or in the absence of such an Article, another article, having

characteristics closely resembling those of the articles under examination.

In response to M/s. BASF, Germany's claim that the product exported

by them is different from the product produced by the petitioner the

Authority holds that

HRPIB is nothing but Poly Iso Butylene as the

product has similar physical and chemical characteristics, product

specification , functions and uses. HR Poly-lso-Butylene and Poly-lso-

Butylene are being used interchangeably. HR Poly-lso-Butylene is only a

type of Poly-lso-Butylene and thus like article to the product under

investigation and the product being manufactured by the Domestic

Industry.

In view of the same, the Authority holds that Poly-lso-Butylene being

produced by the domestic industry and those being imported from the

subject countries can be used interchangeably and thus are commercially

and technically substitutable and therefore, are like articles within the

meaning of the Rules.

DOMESTIC INDUSTRY:

The petition has been filed by M/s. Kothari Sugars & Chemicals Limited,

Manali, Chennai. The petitioner accounts for more than 25% of the

Domestic production during the Period of Investigation of the subject

goods in India . Further after initiation of the investigation two Indian

manufacturers of the subject goods namely M/s Kochi Refineries Ltd., and

M/s Indian Petrochemicals Corporation Ltd., (IPCL) have submitted their

support to the petition for imposition of the Anti Dumping Duty on the

import of the subject goods from the subject countries . Accordingly, the

Authority holds that the petitioner fulfils the requisite criteria to represent

the domestic industry, as required under Rule 5(a) and (b) and Rule 2(b).

NORMAL VALUE, EXPORT PRICE AND DUMPING MARGIN

10.

Under Section 9A(1)( c), normal value in relation to an article means:-

(i)

The comparable price, in the ordinary course of trade, for the like article

when meant for consumption

in the exporting country or territory as

determined in accordance with the rules made under sub-section(6); or

(ii)

When there are no sales of the like article in the ordinary course of trade

in domestic market of the exporting country or territory, or when because

of the particular market situation or low volume of the sales in the

domestic market of the exporting country or territory, such sales do not

permit a proper comparison, the normal value shall be either-

fiii)

Comparable representative price of the like article when exported from the

exporting country or territory or an appropriate third country as determined

in accordance with the rules made under sub-section (6); or

(iv)

The cost of production of the same article in the country of origin along

with reasonable addition for administrative, selling and general costs and

for profits, as determined in accordance with the rules made under sub-

Section(6);

Provided that in the case of import of the article from a country other than

the country of origin and where the article has been merely transshipped

through the country of export or such article is not produced in the country

of export or there is no comparable price in the country of export, the

normal value shall be determined with reference to its price in the country

of origin.

(vi)

The Authority provided opportunity to the exporters from subject countries

to furnish information relevant to the investigations and offer

comments,

if any, in accordance with the Section cited above. The Authority wrote to

the Embassies/High Commissions of subject countries in India also.

11.

TERRITORY OF EUROPEAN UNION

(a)

NORMAL VALUE

The Authority notes that the none of the exporters/producers from the

Territory of European Union have provided the information as per the

prescribed questionnaire.

M/s. Bayer, Germany has however offered

comments which have been considered above.

The Normal Value was determined at the time of initiation of the

investigations on the basis of the constructed cost of production of Poly-

Iso-Butylene as provided by the petitioner.

The Authority adopts the

same for preliminary determination

Accordingly, the Normal Value of

Poly-lso-Butylene for all exporters from Territory of European Union has

been taken at US$ **** per MT.

THE GAZETTE OF TNDTA: EXTRAORDINARY

[PART I—She, 1|

(b)

EXPORT PRICE:

None of the exporters from Territory of European Union has submitted

details of export price in reply to the Questionnaire.

The Authority has .

adopted the export price based on DGCI&S, Calcutta statistics. Ocean

freight, insurance, inland freight, port charges and commission to an

extent of ****, ************ and **** $/MT respectively based on the claim

of the petitioner has been considered. The Ex-factory export price in the

Period of Investigation thus works out to **** $/MT.

12.

BRAZIL:

(a)

NORMAL VALUE:

The" Authority notes that the none of the exporters/producers from Brazil

has provided the information as per the prescribed questionnaire.

The Normal Value was determined at the time of initiation of the

investigations on the basis of the constructed cost of production of Poly-

Iso-Butylene as provided by the petitioner.

The Authority adopts the

same for preliminary determination.

Accordingly, the Normal Value of

Poly-lso-Butylene for

all exporters from Brazil has been taken at US$

**•* per MT.

(b)

EXPORT PRICE:

None of the exporters from Brazil has submitted details of export price

in reply to the Questionnaire. The Authority has adopted the export price

based on DGCI&S, Calcutta statistics. Ocean freight, insurance, inland

freight, port charges and commission to an extent of **** ************ and

**** $/MT respectively based on the claim of the petitioner has been

adopted.

The Ex-factory export price in the Period of Investigation thus

works out to **** $/MT,

13.

JAPAN

(a)

NORMAL VALUE

The Authority notes that the none of the exporters/producers from Japan

has provided the information as per the prescribed questionnaire.

J39

The Normal Value was determined at "the time of initiation of the

investigations on the basis of the constructed cost of production of Poly-

Iso-Butylene as provided by the petitioner.

The Authority adopts the

same for preliminary determination.

Accordingly, the Normal Value of

Poly-lso-Butylene for

all exporters from Japan has been taken at US$

**** per MT.

(b)

EXPORT PRICE:

None of the exporters from Japan has submitted details of export price in

reply to the Questionnaire. Based on the claim of the Petitioner the

Authority has determined the weighted average export price on the basis

of the prices offered by the exporters

from Japan to M/s Indian Oil

Corporation and the export statistics based on DGCI&S, Calcutta for the

Period of Investigation . The

Authority has adopted

ocean freight,

insurance, inland freight, port charges and commission to an extent of ****,

************ and

**** $/MT respectively based on the claim of the

petitioner.

The Ex-factory export price in the Period of Investigation thus

works out to **** $/MT.

KOREA R.P;

M/S. DAELIM CORPORATION . SEOUL .KOREA

(a)

NORMAL VALUE

The Authority notes that the exporter/producer has provided the requisite

information as per the prescribed questionnaire.

The

exporter has

provided invoice wise details of sales of the subject goods in Korea R.P.;

during the Period of Investigation. On the basis of the cost of production

details claimed by the exporters, sales in the Domestic

markets are

above the cost of production and are therefore considered to be in the

ordinary course of trade for the purpose of preliminary findings. Subject to

verification the Authority has also considered the adjustment as indicated

by exporter/producer. The weighted average Ex-factory domestic selling

prices comes to **** USS/MT in Period of Investigation.

(b)

EXPORT PRICE:

The Authority notes

that the exporter/producer has provided

the

transaction wise details of export sales to India of the subject goods

during the Period of Investigation. The exporter/producer has indicated in

the sales price structure for export to India various adjustment of export

price viz. discounts/commission, packing, inland freight, ocean freight,

shipping charges etc.

The Authority for the

purpose of preliminary

findings considers the adjustments as indicated by the exporter/producer.

THE GAZETTE OF INDIA: EXTRAORDINARY

[PART I—SEP. 11

The weighted average ex-factory export price for the subject goods to

India comes to **** $/MT.

15. OTHER EXPORTERS/PRODUCERS OF KOREA R.P.:

(a)

NORMAL VALUE

As no other exporter/producer

from

Korea R.P. has provided

the

information, the Authority has adopted the weighted average domestic

sales price as indicated by other cooperating exporter for assessing the

normal value. The normal value in case of other exporter/producers of

Korea R.P. for the subject during the POI comes to **** $/MT.

(b)

EXPORT PRICE

The Authority has adopted the least of the export price to India as

provided by the cooperative exporter from Korea R.P. without any

adjustment on ocean freight, insurance, commission etc.

The ex-

factory export price in the Period of Investigation comes to **** US$/MT

16.

SINGAPORE

(a)

NORMAL VALUE

The Authority notes that

the none of the exporters/producers from

Singapore has provided

the information as per the prescribed

questionnaire

The Normal Value was determined at the time of initiation of the

investigations on the basis of the constructed cost of production of Poly-

Iso-Butylene as provided by the petitioner.

The Authority adopts the

same for preliminary determination

Accordingly, the Normal Value of

Poly-lso-Butylene for all exporters from Singapore has been taken at

U S $ — per MT.

(b)

EXPORT PRICE:

None of the exporters from Singapore has submitted details of export

price in reply to the Questionnaire. Based on the claim of the Petitioner the

Authority has determined the weighted average export price on the basis

of the prices offered by the exporters from Singapore to M/s Indian Oil

Corporation and the export statistics based on DGCI&S, Calcutta for the

Period of Investigation . The Authority has adopted

ocean freight,

insurance, inland freight, port charges and commission to an extent of ****,

************ and **** $/MT respectively based on the claim of the

petitioner.

The Ex-factory export price in the Period of Investigation thus

works out to **** $/MT.

17.

THAILAND

(a)

NORMAL VALUE

The Authority notes that the none of the exporters/producers from

Thailand has provided the information as per the prescribed questionnaire.'

The Normal Value was determined at the time of initiation of the

investigations on the basis of the constructed cost of production of Poly-

Iso-Butylene as provided by the petitioner.

The Authority adopts the

same for preliminary determination.

Accordingly, the Normal Value of

Poly-lso-Butylene for all exporters from Thailand has been taken at US$

**** per MT.

(b)

EXPORT PRICE:

None of the exporters from

Thailand has submitted details of export

price in reply to the Questionnaire. The Authority has adopted the export

price based on DGCI&S, Calcutta statistics. Ocean freight, insurance,

inland freight, port charges and commission to an extent of ****,

************ a n (j **** <jj/My reSpectiVely based on the claim of the

petitioner.

The Ex-factory export price in the Period of Investigation thus

works out to **** $/MT.

DUMPING-COMPARISON OF NORMAL VALUE AND EXPORT PRICE

18.

The rules relating to comparison provides as follows>

"While arriving at margin of dumping, the Designated Authority shall make

a fair comparison between the export price and the normal value. The

comparison shall be made at the same level of trade, normally at ex-works

level, and in respect of sales made at as nearly possible the same time.

3 3:S^S''-r^,'- ^

THE GAZETTE OF TNDTA: EXTRAORDINARY

|PART1— SKC. 1]

Due allowance shall be made in each case, on its merits, for differences

which affect price comparability, including differences in conditions and

terms

sales,

taxation,

levels

trade,

quantities,

physical

characteristics, and any other differences which are demonstrated to

affect price comparability"

The authority has carried out comparison of weighted average normal

value with the weighted average ex-factory export price for evaluation of

dumping margin.

The dumping margins for the producers/exporters of the subject goods in

the subject countries are as under:-

COUNTRY-WISE

EXPORTERS/

PRODUCERS

KOREA R.P

(i)

M/S.DAELIM

CORPORATION LTD.,

(ii)

ALL

OTHER

EXPORTERS/PRODUC

ERS

ALL EXPORTERS/

PRODUCERS FROM

(i)TERRITORY

EUROPEAN UNION

(ii)BRAZIL

(iii)JAPAN

(iv)THAILAND

(v)SINGAPORE

NORMAL

VALUE

($/MT)

****

EXPORT

PRICE

($/MT)

DUMPING

MARGIN(%

)

15.72%

46.29%

18.03%

44.63%

57.23%

19.09%

34.36%

•K

The above dumping margins are above the deminimus limits.

INJURY:

19.

Under Rule 11 supra, Annexure -II, when a finding of injury is arrived at,

such finding shall involve determination of the injury to the domestic

industry, ".... taking into account all relevant facts, including the volume of

dumped imports, their effect on prices in the domestic market for like

articles and the consequent effect of such imports on domestic producers

of such articles.,.." In considering the effect the dumped imports on prices,

it is considered necessary to examine whether there has been a

significant price undercutting by the dumped imports as compared with the

price of the like article in India, or whether the effect of such imports is

otherwise to depress prices to a significant degree or prevent price

increases, which otherwise would have occurred, to a significant degree.

For the examination of the impact of the dumped imports on the domestic

industry in India, indices having a bearing on the state of the industry as

production, capacity utilisation, sales quantum, stock, profitability, net

sales realisation, the magnitude and margin of dumping, etc. have been

considered in accordance with Annexure ll(iv) of the rules supra.

CUMULATIVE ASSESSMENT OF INJURY

20.

Annexure II (iii) under Rule 11 supra further provides that "in.case where

imports of a product from more than one country are being simultaneously

subjected to Anti Dumping investigation , the Designated Authority will

cumulatively assess the effect of such imports , only when it determines

that the margin of dumping established in relation to the imports from each

country is more than two percent expressed as percentage of export price

and the volume of the imports from each country is three percent of the

imports of the like article or where the export of the individual country is

less than three percent ,the imports cumulatively accounts for more than

seven percent of the imports of like article, and cumulative assessment of

the imports is appropriate in light of the conditions of competition between

the imported article and the like domestic articles"

The Authority notes that the margin of dumping and quantum of imports

from subject countries

are more than the limit prescribed above.

Cumulative assessment of the effect of the imports from Territory of

European Union, Brazil, Japan, Korea R.P., Singapore and Thailand are

appropriate since the export prices from these countries were directly

competing with the prices offered by the Domestic Industry in the Indian

market and displacing domestic producers here.

THE GAZETTEOFINDIA:EXTRAORDINARY

[PART I—SEC. 1]

21.

All economic parameters affecting the Domestic Industry as indicated

above such as production capacity utilisation, sales volume etc. have

been examined as under:-

(a)

QUANTUM OF IMPORTS AND MARKET:

The information with regards to quantum of imports of Poly-lso-Butylene

has been based on information published by DGCI&S, Calcutta. The

Authority notes that the market share of imports of the subject goods from

the subject countries cumulatively was 73.60% during 1999-2000. The

same has increased to 86.62% during the Period of Investigation. The

total imports have increased by about 13% during the Period of

Investigation over 1999-00.

(b)

PRODUCTION:

The total production of petitioner company of subject goods during 1999-

00 was 6111 MT decreased to 5648 MT (Annualised basis) during the

Period of Investigation representing a decrease of about 7.58%.

(c)

SALES VOLUME:

Total sales volumes of petitioner company during 1999-00 was 6392 MT,

which decreased to 5217 MT (annualised basis) during the Period of

Investigation showing a decrease of about 18.38%.

(d)

CAPACITY UTILIZATION:

The petitioner attained an average capacity utilisation of 81.48% in the

year 1999-00, which decreased to 75.31% during the POI.

(e)

SALES REALISATION:

The average sales realisation of petitioner companies from sale of subject

goods in domestic market during the year 1999-00 was Rs. **** per MT,

which increased to Rs. **** per MT in 2000-01 representing an increase

of 5.26%. However the average sales realisation during the last five

months of the period of investigation decreased to ****. This shows a

steep decline of domestic sales realisation with in the Period of

Investigation itself. However it has further been observed that the average

Cost of Production of the subject goods has increased during the Period of

Investigation over 1999-00 by Rs. **** per Mt . Accordingly the increase in

sales realisation during the Period of Investigation has not compensated

the increase in cost of production during the same period over the last

year.

(f)

PROFITABILITY:

It has been observed that the petitioner was earning a net profit of Rs.****

per MT of subject goods during 1999-00. However during the Period of

Investigation, the petitioner incurred a loss of Rs.**** per MT from the

subject goods.

(g)

EVIDENCE OF LOST CONTRACT

The Domestic Industry would loose contracts due to significantly lower

prices quoted by the exporters in the tender floated by M/s Indian Oil

Corporation. Even the sole tender wherein the petitioner is lowest priced

would result in significant loss to the Domestic Industry .

(h)

CLOSING STOCK

Closing stock of the Domestic Industry during the Period of Investigation

over 1999-2000 has increased

substantially from **** Mt to **** Mt.

showing an increase of 351 %.

CAUSAL LINK:

22.(a) The Authority after careful examination of the cost of production of the

Domestic Industry and the landed value of the exports from subjec¹

countries notes that in case of Territory of European Union (EU), and

Thailand the average landed value of exports during the Period of

Investigation

is more than the Non Injurious Price worked out for the

Domestic Industry Accordingly no causal link is established between the

exports from these countries and the material injury caused to the

Domestic Industry. The Authority notes that Poly-lso-Butylene has been

exported to India from remaining countries namely; Brazil, Japan, Korea

R.P. and Singapore at a price

below

its Normal Value.

(b)

The Authority holds that the weighted average export price in US$ terms

from the subject countries as reported by the DGCI&S and as quoted in the

tender floated by the Indian Oil Corporation has significantly declined. The

petitioner company suffered a decline in sales price during the Period of

Investigation itself inspite of increase in cost of production. The petitioner

company was selling the subject goods at a profit earlier were able to sell

the same in domestic market during the period of investigation only at

substantial losses.

All these parameters cumulatively indicate that the

petitioner company has suffered material injury and the injury to petitioner

companies has been caused due to dumped imports of subject goods.

THE GA/bTTE OF INDIA: EXTRAORDINARY

[PART I—SEC. II

INDIAN INDUSTRY'S INTEREST & OTHER ISSUES:

23. (a)The purpose of Anti Dumping Duties, in general, is to eliminate dumping

which is causing injury to the petitioner company and to re-establish a

situation of open and fair competition in the Indian market, which is in the

general interest of the country.

(b)The Authority recognizes that the imposition of Anti Dumping Duties might

affect the price levels of the products manufactured using the subject

goods and consequently might have some influence on relative

competitiveness of these products,

However, fair competition on the

Indian market will not be reduced by the Anti Dumping

measures,

particularly if the levy of the Anti Dumping Duty is restricted to an amount

necessary to redress the injury to the petitioner company.

On the

contrary, imposition of Anti Dumping measures would remove the unfair

advantages gained by dumping practices, would prevent the decline of

the petitioner companies and help maintain availability of wider choice to

the consumers of Poly-lso-Butylene imposition of Anti Dumping measures

would not restrict imports from the subject countries in any way, and,

therefore, would not affect the availability of the product to the consumers.

CONCLUSIONS:

24.

It would be seen, after considering the foregoing, that:

(a)

Poly-lso-Butylene originating in or exported from subject countries

have been exported to India below Normal Value, resulting in

dumping;

(b)

The Indian industry has suffered material injury only from exports

of subject goods from Brazil, Japan, Korea R.P. and Singapore;

(c)

The injury has been caused cumulatively by the imports from Brazil,

" Japan, Korea R.P. and Singapore;

25.

It is considered necessary to impose Anti-Dumping Duty, provisionally,

pending final determination, on all imports of Poly-lso-Butylene originating

in or exported from Brazil, Japan, Korea RP and Singapore pending final

determination.

26.

It was considered whether a duty lower than the dumping margin would be

sufficient to remove the injury. The average landed price of the imports,

for the purpose, was

compared with the Non-injurious

price of the

petitioner company, determined

for the period of investigations.

Wherever the difference was less than the dumping margin, a duty lower

than the dumping margin is recommended.

Accordingly, it is proposed

that provisional Anti Dumping Duty equal to the difference between the

amount indicated in column (2) below and the landed value of imports be

imposed from the date of notification to be issued in this regard by the

Central Government, on all grades of subject goods originating in or

exported from Brazil, Japan, Korea RP and

Singapore

falling under

Chapter 39 or any other Chapter of the Customs Tariff Act, 1975, pending

final determination.

COUNTRY-WISE EXPORTERS/

PRODUCERS

KOREA R.P

(ii)

M/S.DAELIM

CORPORATION

LTD.,

(ii)

ALL

OTHER

EXPORTERS

/PRODUCERS

ALL EXPORTERS/

PRODUCERS FROM

(i)TERRITORY OF EUROPEAN UNION

(ii)BRAZIL

(iii)JAPAN

(iv)THAILAND

(v)SINGAPORE

AMOUNT IN US$ PER MT

(2)

1037.77

N.A.

1037.77

N.A.

1037.77

27.

Landed value of imports for the purpose shall be the assessable value as

determined by the customs under the Customs Act, 1962 and all duties of

customs except Additional duty of Customs levied under Section 3, 3A,

8B, 9 and 9A of the Customs Tariff Act, 1975.

THE GAZETTE OF INDIA: EXTRAORDINARY

| PART I—SEC. 1]

FURTHER PROCEDURE:

28.

The following procedure would be followed subsequent to notifying the

preliminary findings:-

(a)

The Authority invites comments on these findings from all interested

parties and the same would be considered in the final finding;

(b)

Exporters, importers, petitioner and other interested parties known to be

concerned are being addressed separately by the Authority, who may

make known their views, within forty days from the date of the dispatch of

the letter. Any other interested party may also make known its views

within forty days from the date of publication of these findings;

(c)

The Authority would conduct further verification to the extent deemed

necessary;

(d)

The

Authority would disclose essential facts before announcing final

findings.

L. V SAPTHAR1SHI, Designated Authority

Printed by the Manager. Govl. ol India Press, Ring Road, Mayapurl, New Delhi-110064

and Published by th« Controller ot Publications, Dalhl-110054 — 2001