Case T-107/08

Transnational Company ‘Kazchrome’ AO and ENRC Marketing AG

v

Council of the European Union and European Commission

(Dumping – Imports of silico-manganese originating in China and Kazakhstan – Action for annulment – Export price – Comparison between export price and normal value – Calculation of the undercutting margin – Non-contractual liability)

Summary of the Judgment

1.      Actions for annulment – Council Regulation imposing a definitive anti-dumping duty – Action against the Commission – Inadmissibility

(Art. 230 EC; Council Regulation No 1420/2007)

2.      Acts of the institutions – Statement of reasons – Obligation – Scope – Regulation imposing anti-dumping duties – Adjustments of the export price to ensure a fair comparison between the normal value and the export price – Lack of sufficient reasoning

(Art. 253 EC; Council Regulation No 1420/2007)

3.      Common commercial policy – Protection against dumping – Imposition of an anti-dumping duty – Condition – Injury – Determination – Comparison between the normal value and the export price – Calculation of the undercutting margin

(Council Regulations No 384/96, Art. 3(2) and (3), No 1225/2009, Art. 3(2) and (3), and No 1420/2007, recitals 104 and 105)

4.      Non-contractual liability – Conditions – Unlawfulness – Injury – Causal link – Regulation imposing anti-dumping duties – Reduction in the volume of sales of an undertaking subject to that regulation – No causal link

(Art. 288 EC; Council Regulation No 1420/2007)

5.      Non-contractual liability – Conditions – Unlawfulness – Injury – Causal link – Expenses incurred in participating in anti-dumping proceedings involving an unlawful regulation – No causal link

(Art. 288, second para., EC)

1.      The Commission’s role in anti‑dumping proceedings forms an integral part of the Council’s decision-making process. The Commission is responsible for carrying out investigations and for deciding, on the basis of those investigations, whether to terminate the proceedings or to continue them by adopting provisional measures and by proposing that the Council adopt definitive measures such as a regulation imposing anti-dumping duties. However, the power of decision belongs to the Council, which is not obliged to take any decision at all if it disagrees with the Commission or may, if it wishes, adopt a decision on the basis of the latter’s proposals. In those circumstances, an action for annulment of a regulation adopted only by the Council is inadmissible in so far as it is directed against the Commission.

(see para. 26)

2.      The statement of reasons required by Article 253 EC must be appropriate to the act at issue and must disclose in a clear and unequivocal fashion the reasoning followed by the institution which adopted the measure in question in such a way as to enable the persons concerned to ascertain the reasons for the measure and to enable the competent Court to exercise its power of review. The requirements to be satisfied by the statement of reasons depend on the circumstances of each case, in particular the content of the measure in question, the nature of the reasons given and the interest which the addressees of the measure, or other parties to whom it is of direct and individual concern, may have in obtaining explanations. It is not necessary for the reasoning to go into all the relevant facts and points of law, since the question whether it meets the requirements of Article 253 EC must be assessed with regard not only to its wording but also to its context and to all the legal rules governing the matter in question.

As regards a Council regulation imposing an anti-dumping duty, the assessment that a company which sells products to which the anti-dumping duty is applicable has, in the sales flow of the production company, functions similar to those of an agent working on a commission basis is vitiated by a lack of reasoning where, in order to make a fair comparison between the normal value and the export price and to make export price adjustments on a commission basis, inter alia, the Council merely states that those undertakings maintain a commercial relationship established under normal conditions of competition and that, accordingly, the sales company cannot be regarded as acting as an internal sales department, in spite of the evidence furnished by the undertakings concerned seeking to show that the relationship between them was that of a company and an internal sales department.

(see paras 31, 34, 36-37, 40)

3.      Article 1(1) of basic anti-dumping Regulation No 384/96 (now Article 1(1) of Regulation No 1225/2009) lays down the essential rule for imposing anti-dumping duties, pursuant to which it is not sufficient that the imported goods are dumped. Their release for circulation must also cause injury. It is precisely for determining whether there has been injury that the basic regulation provides, in Article 3(2) and (3) (now Article 3(2) and (3) of Regulation No 1225/2009), that an objective examination of the effect that imports have on the prices of similar goods on the European Union market must be made and that, to that end, consideration is to be given to whether there has been significant price undercutting by the dumped imports as compared with the price of a like product, or whether the effect of such imports is otherwise to depress prices to a significant degree or to prevent price increases, which would otherwise have occurred, to a significant degree.

In those circumstances, where, in Regulation No 1420/2007 imposing a definitive anti-dumping duty on imports of silico‑manganese originating in the People’s Republic of China and Kazakhstan and terminating the proceeding on imports of silico-manganese originating in Ukraine, calculates, for the purpose of comparing import prices and European Union industry prices and determining whether injury has been caused to that industry by the dumped goods, the undercutting margin of the imported goods, it commits a manifest error of assessment in considering that the objective comparison between the import prices and those of the European Union industry and import prices requires that the reference point for determining the price of the latter is the point of their first entry in European Union territory and not where they were cleared for customs, in spite of the distance between those two points, thereby excluding from their price the significant expenses incurred in transporting them.

It is the prices negotiated between the exporting companies and the customers in reference to the point of customs clearance and not the prices calculated by the Council at an intermediate stage of transport, even if in European Union territory, which could lead customers to opt for the goods of the exporting companies instead of those of the European Union industry. The Council and Commission must, none the less, take account, within the limits of their discretion, of all the relevant factors in each case, including evidence which suggests that the choice of means of transport and customs clearance points is intended to distort the comparison between import prices and those of European Union products.

(see paras 58, 63, 67-68)

4.      A mere reference to the reduction in the volume of sales of an undertaking subject to Regulation No 1420/2007 imposing a definitive anti-dumping duty on imports of silico‑manganese originating in the People’s Republic of China and Kazakhstan and terminating the proceeding on imports of silico-manganese originating in Ukraine cannot suffice as evidence of the causal link required by the case‑law for the European Union to incur non-contractual liability, as a result of large variations in the volume of sales from one year to the next, irrespective of the adoption of that regulation.

(see paras 76-77)

5.      In so far as concerns the non-contractual liability of the European Union, the injury must result directly from the alleged illegality and not from the applicant’s choice as to how to react to the allegedly unlawful act. Thus, the mere fact that the unlawful conduct constituted a necessary condition for the damage to arise, in the sense that the damage would not have arisen in the absence of such conduct, is not sufficient to establish a causal link.

Therefore, expenses incurred as a result of a company’s participation in anti-dumping proceedings cannot be regarded as injury resulting from the adoption of an unlawful regulation, since exporting producers or any interested parties are not required to participate in anti‑dumping proceedings and they are free to assess whether to participate and why they should do so, as well as the degree of their involvement and expenditure for that purpose. Moreover, expenses incurred which correspond to the work carried out by the staff of such an exporting producer cannot be regarded as having a direct link to the investigation since staff members would have to receive their salaries irrespective of whether anti-dumping proceedings were ongoing.

(see paras 80-82)