With regard to Sun Sweet, it is noted that in the framework of the undertaking, the company agreed to respect a number of obligations, such as, inter alia, not to issue undertaking invoices within 1 calendar year to customers in the Community to which they sell other products, in order to reduce the risk of cross-compensation.

Moreover, and without prejudice to the abovementioned clause, the company agreed that it will not have the option of making some sales under the terms of the undertaking und others with payment of the anti-dumping duties as long as the quantitative ceiling is not reached.

The company also agreed not to circumvent the undertaking by, inter alia, taking part in a trading system leading to a risk of circumvention.

The terms of the undertaking also oblige the company to provide the Commission with regular and detailed information in the form of a quarterly report of its sales of the product concerned to the European Community.

For the purpose of ensuring compliance with the undertaking, the company also undertook to allow on-spot verification visits at its premises in order to verify the accuracy and veracity of data submitted in the said quarterly reports and to provide all information considered necessary by the Commission.

In addition, the acceptance of the undertaking by the European Commission is based on trust and any action which would harm the relationship of trust established with the European Commission shall justify the immediate withdrawal of the undertaking.

Furthermore, any changes in circumstances occurring during the period of implementation of the undertaking from those circumstances prevailing at the time of acceptance of the undertaking which were relevant to the decision to accept the undertaking may give rise to the withdrawal of the undertaking by the European Commission.

In this regard and in parallel to the visit carried out in the framework of the partial interim review limited to the form of the measure initiated on 16 September 2008, a verification visit was carried out at the premises of Sun Sweet.

The verification visit established a number of breaches of the undertaking.

In view of the above, the following is concluded:

A change in the pattern of trade since the imposition of measures has led to a significant risk of cross-compensation which no longer allows the Commission to effectively monitor the undertaking. This change in the pattern of trade is considered as a relevant change in circumstances compared to those prevailing at the time of acceptance of the undertaking.

A breach of the cross-compensation clauses of the undertaking occurred since the company sold both, the product covered by the undertaking and other products to the same client in the same calendar year but continued to issue undertaking invoices for the product covered.

The sales made to certain customers outside the undertaking before the quantitative ceiling was reached constitute another breach of the undertaking.

In addition, the company failed to submit quarterly reports which are complete, exhaustive and correct in all particulars.

Although the verification did not reveal that sales were made below the minimum import price, the numerous other breaches of the undertaking mentioned above do not allow the Commission to effectively monitor the undertaking and have undermined the relationship of trust which formed the basis for the acceptance of the undertaking.

With regard to the change in the pattern of trade and the increasing risk of circumvention resulting from such a change, the company submitted that it had no intention to violate the undertaking and that it did not change the pattern of trade in order to circumvent the terms of the undertaking. It was further added that no cross-compensation had taken place.

In response to this argument, it should be mentioned that there was indeed no evidence for an intentional violation of the price undertaking. However, the change in the pattern of trade as such constitutes a serious risk of cross-compensation, regardless of the underlying reason. It is long-standing practice of the Commission not to accept price undertakings if the risk of cross-compensation is too high. Consequently, if such a change in the pattern of trade occurs during the period of application of an undertaking, the change in itself is sufficient for the Commission to withdraw the undertaking, because it renders proper monitoring of the undertaking impractical, regardless of whether or not cross-compensation actually took place.

Accordingly, the arguments presented by the company in this respect do not alter the Commission’s view that the change in the pattern of trade had led to a significant risk of cross-compensation.

The company further submitted that it misunderstood the terms of the undertaking when selling the product concerned together with other products and when selling outside the undertaking before reaching the quantitative ceiling. It also underlined that it concerned only a small quantity and that those practices were immediately ceased.

Additionally, the company argued that the errors in the undertaking reports were of limited importance and mainly due to typing errors which the company tried to correct as much as possible during the verification visit. A withdrawal of the undertaking would not give the company a chance to improve the reporting practice and to correct the shortcomings identified during the verification. The company also brought forward the argument that the Commission has sent each quarter an e-mail confirming that no error was found in the electronically submitted version of the report and underlined that the main clause of the undertaking, the respect of the minimum price, has never been violated.

In response to those submissions, it has to be stressed that already in 2007, the Commission exceptionally provided all companies that offered an undertaking with detailed information and training regarding the functioning of undertakings and the obligations of the companies.

Furthermore, it should be emphasised that the respect of the minimum price is indeed a core element of a price undertaking, but not the only one. It is equally important to respect the other obligations as well, including the obligation to provide regular sales reports that are complete, exhaustive and correct in all particulars in order to allow proper monitoring by the Commission. The confirmation e-mail the company referred to is an automatically generated message which confirms that the structure of the report is in accordance with the technical specifications outlined in the Annex to the undertaking text. As also explicitly mentioned in the same Annex, it does not confirm correctness in substance.

Therefore, the arguments presented by the company in this respect do not alter the Commission’s view that the numerous breaches of the undertaking render the undertaking unworkable and are sufficient to withdraw acceptance of the undertaking.