The request for the expiry review was based on the grounds that the expiry of the measures would be likely to result in a continuation or recurrence of dumping and injury to the Union industry.

As explained above, it was not necessary to apply sampling in respect of exporting producers in the PRC.

In accordance with Article 11(2) of the basic Regulation, it was examined whether the expiry of the existing measures would be likely to lead to a continuation or recurrence of dumping.

Given the absence of significant import volumes from the PRC into the Union, these did not form a basis for a representative dumping finding. Therefore, no dumping calculation was made on the basis of the export prices from the PRC and the investigation therefore focused on the likelihood of recurrence of dumping.

Given the fact that no exporting producer in the PRC cooperated in this investigation, the conclusions below rely on facts available in accordance with Article 18 of the basic Regulation, namely Eurostat data and the review request.

Given that the prices of exports of the product under investigation to the PRC’s main export markets are below the normal value established during the RIP, and on the basis of the increasing spare capacity, it is likely that the volume of Chinese exports into the EU would increase at dumped prices should measures lapse.

In the light of the above, there is a likelihood of recurrence of dumping should measures be repealed.

Union consumption was established on the basis of the sales volumes of the Union industry on the Union market, the import volumes data for the Union market obtained from Eurostat and, concerning the other Union producers, from estimations based on the review request.

Pursuant to Article 3(5) of the basic Regulation all economic factors and indices having a bearing on the state of the Union industry during the period considered have been examined.

The analysis of the macroeconomic data shows that the Union producers decreased their production and sales during the period considered. Although the observed decrease was not dramatic as such, it needs to be seen in the context of increased demand between 2006 and the RIP, which resulted in the Union producers’ market share dropping by 10 percentage points to 75 %.

At the same time the relevant microeconomic indicators show a clear deterioration of the economic situation of the sampled Union producers. The profitability and return on investment remained negative and declined further overall between 2006 and the RIP. The cash flow, despite an overall positive development, also remained negative in the RIP.

In the light of the foregoing, it is concluded that the Union industry has continued to suffer material injury within the meaning of Article 3(5) of the basic Regulation and that its situation is very fragile and vulnerable and far from the levels that could be expected had it recovered from the injury found in the original investigation.

As concluded in recital 38 above, the exporting producers in the PRC have significant spare capacities and a clear potential to increase their export volumes to the Union market.

The CIF export prices to third countries of PET originating in the PRC were lower than the average prices of the Union industry in the RIP. It is noted that the difference was not significant and given that these imports are subject to a conventional customs duty and some post importation charges, they would have not undercut the Union industry’s prices prevailing in the RIP. However, it must be stressed that the information from the parallel anti-subsidy proceeding mentioned in recital 6 shows that the prices of the Union industry in the RIP were significantly depressed by the subsidised imports from Iran, Pakistan and the UAE. Thus, the fact that there was no actual undercutting during the RIP does not mean that should imports from the PRC resume, their price levels would not be injurious.

Indeed, a comparison of the actual import prices from the PRC with the non-injurious price level showed that imports from the PRC would undersell the (non-injurious) Union industry’s prices. Consequently, in the absence of anti-dumping duties on imports originating in the PRC, any increased volumes of likely dumped imports from the PRC would exercise an even stronger price pressure on the Union industry and cause injury.

Furthermore, given the existing spare capacities for PET in the PRC, combined with the fact that the exporters in the PRC would in all likelihood try to regain their lost market shares, a repeal of measures would in all likelihood result in lower export prices. This would reinforce the price pressure with an expected further negative impact on the already vulnerable and materially injured situation of the Union industry.

Although the effect of imports from the PRC on the current precarious state of the Union industry was limited due to the low levels of imports during the period considered, this would in all likelihood change, should measures be repealed. Indeed, if the measures were repealed and the Union industry was exposed to increased volumes of imports from the PRC at dumped prices, this would result in further deterioration of its already precarious financial situation and further losses.

On this basis, it is concluded that the repeal of measures against the PRC would in all likelihood result in the continuation of injury to the Union industry.

The continuation of the anti-dumping measures on imports from the country concerned would enhance the possibility for the Union industry to reach a reasonable level of profitability, as it would help avoiding that the Union industry is pushed out of the market by substantial volumes of dumped imports from the PRC. Indeed, there is a clear likelihood of injurious dumping in substantial volumes which the Union industry could not withstand. The Union industry would therefore continue to benefit from the maintenance of the current anti-dumping measures.

Accordingly, it is concluded that the maintenance of anti-dumping measures against the PRC would clearly be in the interest of the Union industry and other Union producers.

As indicated above, only one importing agent submitted some information in the sampling exercise. This agent strongly opposed any continuation of the measures although it declared no imports from the PRC. Consequently, it is concluded that the maintenance of measures against imports from the PRC will not have any significant impact on the performance of this agent.

No other importer submitted relevant information. Given that imports from other countries where there are currently anti-dumping measures in force did not stop and that imports are available from countries without any anti-dumping measures (e.g. Oman, USA, Brazil), it is considered that importers could continue to source from the alternative sources of supply.

Bearing in mind that there is no evidence suggesting that the measures in force considerably affected importers, it is concluded that the continuation of measures will not affect the Union importers to any significant extent.

Three raw material suppliers (two of PTA and one of MEG) cooperated with the investigation by submitting the questionnaire reply within the set time limit. The staff employed in their European facilities and involved in the production of PTA/MEG was around 700.

The cooperating PTA producers represent around 50 % of the PTA purchases of the sampled Union producers. PTA producers are heavily dependant on the state of the PET producers that constitute their major clients. Low prices of PET translate into lower prices of PTA and lower margins for the PTA producers. Consequently, it is considered that the imposition of measures on the dumped imports of PET would benefit the PTA producers.

For the cooperating MEG supplier, MEG represents less than 10 % of its total turnover. It is noted that with regard to MEG, PET is not its only or even the major possible application and MEG producers are less dependent on the situation of the PET industry. None the less, the difficulties of the PET industry may have some limited impact on the suppliers of MEG, at least in a short to medium term.

Given the above, it is concluded that continuation of measures against imports from the PRC would be in the interest of raw material suppliers.

PET subject to this proceeding (i.e. with the viscosity number of 78 ml/g or higher, so called ‘bottle grade’) is mostly used to produce bottles for water and other drinks. Its use for the production of other packages (solid foodstuff or detergents) and to produce sheet is developing, but it remains relatively limited. Bottles of PET are produced in two stages: (i) first a pre-form is made by mould injection of PET, and (ii) later the pre-form is heated and blown into a bottle. Bottle making can be an integrated process (i.e. the same company buys PET, produces a pre-form and blows it into the bottle) or limited to the second stage (blowing the pre-form into a bottle). Pre-forms can be relatively easily transported as they are small and dense, while empty bottles are unstable and due to their size very expensive to transport.

PET bottles are filled with water and/or other beverages by the bottling companies (bottlers). The bottlers are often involved in the PET business either via integrated bottle making operations or via tolling agreements with 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 (hard tolling).

• converters and/or bottle makers that buy PET directly from producers, convert it into pre-forms (or bottles) and sell it further for downstream processing (or filling), and

• bottlers that buy PET for their subcontracting bottle makers/converters (hard tolling) or negotiate the price for which the subcontracted converter and/or bottle maker will get the PET (soft tolling).

Over 70 users have been contacted in this investigation, but only seven of them (converters and bottlers) decided to cooperate by filling in a questionnaire.

It has been established that the cooperating users imported only negligible quantities of PET from the country concerned and sourced it predominantly from the Union producers and/or from other countries.

Given that alternative sources of supply continue to exist and that currently the users imported only very limited volumes of the product concerned from the PRC, it is concluded that the continuation of measures against imports from the PRC will not have any significant negative effect on the users in the Union.

Following disclosure of the essential facts and considerations on the basis of which it was intended to recommend that the existing measures be maintained some interested parties, in particular users, submitted their comments.

The Union producers that requested the review basically agreed with the findings of the investigation and in particular with the conclusions with regard to the Union interest.

On the other hand seven users and one association of users expressed their strong opposition against the reimposition of the current anti-dumping measures, claiming that the Commission’s findings with regard to the Union interest display serious deficiencies and inaccuracies; however, without substantiating their claims any further.

Given the lack of any evidence that would support the claims with respect to alledged inaccuracy of the Commission’s findings, these claims are rejected as unfunded.

Following the disclosure the cooperating importing agent also strongly opposed the reimposition of measures.

This interested party claimed that the Commission failed to properly take into account the interest of the PET users’ industry, that would allegedly suffer from any PET price increase as they would not be in a position to pass forward any cost increase.

It is noted in this regard that this interested party failed to demonstrate how in practice the maintainance of already existing measures could lead to any increase of the PET price on the Union market and to what extent.

It is also reiterated that given the relatively low cooperation of users in this investigation, there is no information on the file that would show that the continuation of measures would have disproportionate effects on users.

Consequently, based on the information available, it is considered that maintaining the measures will not have any disproportionate negative effects on the level of PET prices in the EU and thus the claim regarding the negative impact on users, as presented by the importing agent, is rejected.

The same interested party claims that the Commission failed to examine the impact of the continuation of current measures on PET packaging companies and that consequently the Union interest analysis in incomplete and incorrect.

It is reiterated in this regard that following the initiation of this review only seven users came forward and the information available in the framework of this proceeding did not allow for the analysis of the interest of this sub-group of users in the Union.

The comments submitted after the disclosure, including the comments from packaging companies, were (as indicated above in recitals 101 and 102) not substantiated and could not be used for a more exhaustive analysis concerning the packaging industry.

Taking into account all of the factors outlined above, it is concluded that there are no compelling reasons against the maintenance of the current anti-dumping measures.