The measures currently in force are a definitive anti-dumping duty on the importation of hand pallet trucks and their essential parts originating in the PRC consisting of an ad valorem duty established at 70,8 %.

The request was lodged by two Union producers, Toyota Material Handling Manufacturing Sweden AB and PR Industrial S.r.l. (‘the applicants’), representing more than 25 % of the total Union production of hand pallet trucks and their essential parts.

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

In the Notice of Initiation, the Commission informed interested parties that it envisaged Brazil as a third market economy country (‘analogue country’) within the meaning of Article 2(7)(a) of the basic Regulation. Interested parties had an opportunity to comment on this choice. No comments were received.

The Commission contacted the Brazilian authorities and informed the two known producers of hand pallet trucks in Brazil about the initiation and invited them to participate. One of the producers in Brazil was willing to cooperate. No other known producer, nor any other Brazilian producer, replied.

The Commission also sought cooperation from known producers in other potential analogue countries and contacted the relevant authorities in Cambodia, India, Malaysia, Taiwan, Turkey and the USA inviting them to provide the names and addresses of producers' association and producers that are known to produce and sell hand pallet trucks on their market. However, none of the contacted countries provided such information and no producer from these countries was willing to cooperate.

In its Notice of Initiation, the Commission stated that it might sample the interested parties in accordance with Article 17 of the basic Regulation.

Questionnaires were sent to the six known Union producers and two producers of hand pallet trucks in Brazil. The Commission received replies to the questionnaire from five Union producers and one producer of hand pallet trucks in Brazil.

None of the users supplied the Commission with any information or made themselves known in the course of the investigation.

• Union producers:

  • PR Industrial S.r.l., Casole d'Elsa, Italy

  • Toyota Material Handling Manufacturing Sweden AB, Mjölby, Sweden

  • Logitrans A/S — Denmark, Ribe, Denmark

  • ZAKREM Sp. z o.o., Grajewo, Poland

  • VMH — Material Handling s. r. o., Veľký Šariš, Slovakia

• Producer in the analogue country:

  • Paletrans Equipamentos, Cravinhos, Brazil

The investigation of dumping and injury covered the period from 01 October 2015 to 30 September 2016 (‘the review investigation period’ or ‘RIP’). The examination of trends relevant for the assessment of injury covered the period from 01 January 2013 to the end of the investigation period (‘the period considered’).

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

As mentioned in recital 22 none of the Chinese exporting producers cooperated in this investigation. Therefore, the Commission informed the Chinese authorities that in accordance with Article 18 of the basic Regulation facts available may be used with regard to the Chinese exporting producer in order to determine whether dumping is currently taking place and the likelihood of continuation or recurrence of dumping. The Commission did not receive any comments or requests for an intervention of the Hearing Officer from the Chinese authorities in this regard.

1. (i)

   information contained in the request;

2. (ii)

   Eurostat statistics and the data reported to the Commission by the Member States pursuant to Article 14(6) of the basic Regulation (‘Article 14(6) database’);

3. (iii)

   publicly available statistics of the Chinese Export Statistics;

4. (iv)

   publicly available statistics of the U.S. International Trade Commission Interactive Trade DataWeb (USITC DataWeb), using data retrieved from the U.S. Bureau of the Census;

5. (v)

   publicly available statistics of the ‘Trade Map’ of Market Analysis and Research Division of the International Trade Centre (ITC) in Geneva, Switzerland.

Based on the above, the Commission considered that should the measures be repealed there is a strong likelihood of continuation of dumping. Indeed, based on the dumping margins found during the RIP for imports into the Union market, it is likely that imports from China will continue to be made at dumped prices. Moreover, in view of the significant production capacity and spare capacity available in China, even though there are no indications about the absorption capacity, and given the attractiveness of the Union market, it is likely that these imports will continue to enter the Union market in large quantities that are likely to significantly further increase should measures be allowed to lapse.

The like product was manufactured by six producers in the Union during the review investigation period. They constitute the ‘Union industry’ within the meaning of Article 4(1) of the basic Regulation.

Only five Union producers replied to the questionnaire. The sixth Union producer was willing to cooperate but did not reply to the questionnaire. It represents 2 % of total Union production. Accordingly, the Commission could base its findings on five producers representing 98 % of the total Union production, as well as on the estimation for the sixth producer on the basis of the information provided during the standing exercise.

The Commission established the Union consumption on the basis of the sales volumes of the Union industry on the Union market and import data from Eurostat.

Total Union industry sales were obtained on the basis of the questionnaire replies of the five Union producers and an estimate for the sixth company, based on its market share.

From 2013 to the RIP the Union consumption increased by 46 %. It showed a decrease from 2014 to 2015, but increased again to levels similar to those in 2014 during the RIP.

In the absence of cooperation of any Chinese exporting producers, the Commission used the statistics available in Eurostat to establish the volume and prices of imports from the PRC to the Union during the period considered.

Volumes of imports from third country markets increased significantly (passing from 16 643 in 2013 to 258 217 pieces in the RIP) over the period considered. During the RIP, their combined market share reached 49 %. This increase should be seen in the light of the loss of market share of the Chinese imports (– 75 %) discussed in recital 69.

The average price of imports from third countries rose by 13 % between 2013 and the RIP.

Of these imports, volumes from Malaysia increased steeply over the period considered and their market share rose from 1 % in 2013 to 34 % in the RIP. Import prices from Malaysia increased by 27 % during the period considered. In the RIP they were on average 3 % lower than Chinese prices (without anti-dumping duties) and 13 % lower than the Union industry prices.

Similarly, imports volumes from Vietnam rose significantly and their market share increased from 2 % to 11 % between 2013 and the RIP. Import prices from Vietnam increased by 21 % during the period considered. In the RIP they were on average 12 % lower than Chinese prices (without anti-dumping duties) and 22 % lower than the Union industry prices.

In accordance with Article 3(5) of the basic Regulation, the examination of the impact of the dumped imports on the Union industry included an evaluation of all economic indicators having a bearing on the state of the Union industry during the period considered.

For the injury determination, the Commission distinguished between macroeconomic and microeconomic injury indicators. The Commission evaluated the macroeconomic indicators on the basis of data contained in the questionnaire replies and made estimation for the sixth producer on the basis of the information provided during the standing exercise. The Commission evaluated the microeconomic indicators on the basis of data contained in the questionnaires of the five Union producers who provided a reply.

The macroeconomic indicators are: production, production capacity, capacity utilisation, sales volume, market share, growth, employment, productivity and magnitude of the dumping margin and recovery from past dumping.

The microeconomic indicators are: average unit prices, average unit cost, labour costs, inventories, profitability, cash flow, investments, return on investments, and ability to raise capital.

Due to anti-dumping duties in place, and in particular since their increase to 70,8 % in 2013 following the interim review mentioned in recital 5, the Union industry was able to start to recover from the effect of past injurious dumping.

Over the period considered, almost all indicators, namely production volume, capacity utilisation, sales volume, employment, productivity, inventories, investments and return on investments and finally the profitability showed visible improvements. Unit cost of production decreased partly due to the lower raw material costs and the increase in production volume.

Nevertheless, the Union industry only started to recover from the past dumping recently and this recovery is still fragile. This is evidenced by the fact that the Union industry managed to book profits only at the end of the period considered, i.e. during the RIP. Likewise, in a context of steep consumption increase (+ 46 %), the Union industry could only expand its market share by 5 percentage points.

In conclusion, the Union industry did not suffer material injury during the period considered within the meaning of Article 3(5) of the basic Regulation. As mentioned above, since the recovery of the Union industry is still recent, its situation remains however fragile.

The investigation has shown that the Chinese imports were made at dumped price levels during the RIP and that there was a likelihood of continuation of dumping should measures be allowed to lapse.

• the significant production and spare capacity in the PRC (recitals 49 to 51),

• the export behaviour of Chinese exporting producers to other third country markets (recitals 52 to 55), and

• the attractiveness of the Union market (recitals 56 and 57).

In addition, the Commission assessed the likely impact of Chinese imports on the Union industry should these resume in significant quantities.

The Commission used the price of Chinese imports without anti-dumping duties applicable in the RIP in order to assess the likely price level of Chinese imports into the Union market should the measures be repealed. On this basis Chinese prices would likely undercut the Union industry sales prices on average by around 41 % as revealed in recital 73 above.

When faced with such price pressure in large volumes, the profitability of the Union industry is likely to immediately deteriorate with the risk to even turn back to losses. Indeed the Union industry will either be forced to decrease its prices, having a direct negative impact on the profitability. Alternatively, it could decide to maintain its price levels unchanged in an effort to maintain its profitability. However, as observed in the past, this would have a negative impact on its sales volume to the benefit of the Chinese exporters. Also, when decreasing sales volume, the share of fix costs per piece would increase in particular in view of fact that this is a capital intensive industry. In turn, this would also affect negatively the Union industry's profitability. Therefore, to maintain sales prices in the Union market at similar levels as during the RIP cannot be considered as a viable strategy as it would not be sustainable in the long term.

In addition, the above scenario would remain valid even when taking into account an increasing consumption. Indeed, in view of the huge spare capacity available in China that is likely to be exported to the Union market at prices undercutting the Union industry's prices by around 41 %, the Union industry would not be able to cope with the expected significant resurge of Chinese imports, which would not only take over the Union industry's current market share but also likely take over the increased consumption. In this respect, it is recalled that the market share of Chinese imports was as high as 83 % in the RIP of the first expiry review.

Finally, the underselling margin based on Chinese import prices without duty amounted to around 75 % in the RIP, which also gives a reasonable estimate of possible underselling margins should measures be allowed to lapse.

As described in recital 77, in a market with increasing consumption, imports from Malaysia took over a large part of the Chinese market share during the period considered. Thus, while Malaysia gained 33 percentage points of market share, China lost 50 percentage points. At the same time the Union industry gained only 5 percentage points.

Should measures be allowed to lapse, Chinese import prices would likely significantly undercut the Union industry prices, as shown in recital 112. During the period considered, Chinese import prices (without anti-dumping duties) have also consistently been lower than the Malaysian import prices during the same period, expect during the RIP when these were 3 % higher.

On this basis it can be expected that low priced Chinese imports are likely to affect both the Union industry sales volumes and the Malaysian import volumes. As the Union industry prices were on average higher than the Malaysian import prices, it can also be expected that the Chinese imports will likely have a greater negative impact on the Union industry's sales than on the Malaysian imports, as customers of the Union industry will have a much higher incentive to revert to Chinese suppliers than the customers of the Malaysian suppliers.

On this basis, it is likely that Chinese imports that would (re)enter the Union market at low prices will be able to regain market shares mainly at the expense of the Union industry.

As to the imports from Vietnam, whose market share increased by 9 percentage points during the period considered, these are currently subject to an anti-circumvention investigation mentioned in recital 7 initiated on the grounds that these imports are allegedly of Chinese origin.

In any event, the price of the Vietnamese imports as shown in recital 78 was lower than the sales price of the Union industry throughout the whole period considered. As above described, it is therefore considered that customers of the Union industry will have higher incentive to switch to low priced imports from China than customers of the Vietnamese suppliers. The latter were selling hand pallet trucks on the Union market already below the Chinese import price except for 2014. On this basis, it can be expected that Chinese imports will likely have a greater negative effect on the Union industry than on the Vietnamese imports.

To summarise, the investigation has revealed that Chinese imports were made at dumped price levels during the RIP. Moreover the Commission established the presence of significant production and spare capacity in the PRC, assessed that the Chinese exporting producers sell at lower prices in third market than in the Union market, took into account the continuous presence of Chinese exporting producers in the Union market and noted the effort deployed to circumvent the measures in place. In addition the Commission estimated that the likely price of Chinese imports should measures be repealed would significantly undercut and undersell Union prices. Finally, the Commission assessed that the impact of the imports from other third countries will be lower than the impact of Chinese imports on the Union industry, should measures be repealed. On the basis of the above, it can be concluded that the repeal of the measures would in all likelihood result in a recurrence of injury to the Union industry.

The Commission found that during the RIP the Union industry has started to recover from the past dumping. However, should measures against China be repealed it is likely that the injury would recur as the Union industry would be exposed to dumped imports from China potentially in significant volumes and exerting significant price pressure.

As a consequence the economic situation of the Union industry would likely deteriorate, translating in a significant loss of sales volume and market share and would likely turn into loss-making.

On the contrary, maintaining the measures would allow the Union industry to consolidate its recently established positive economic situation

The Commission contacted twelve known importers and nine known users at the initiation stage. None of the importers replied to the sampling form or came forward with comments. Likewise, none of the users came forward or submitted any comments.

It is recalled that in the investigation that lead to the imposition of the original measures in 2005 and in the expiry review that lead to the extension of these measures in 2011, it was found that the impact of measures would not have a serious effect on importers/users in the Union.

In the absence of any new evidence suggesting a different conclusion, the Commission therefore concluded that the continuation of measures will not affect the importers or users in the Union to any significant extent.

On the basis of the above, the Commission concluded that there were no compelling reasons in terms of Union interest that would speak against the maintenance of the definitive anti-dumping measures on imports of hand pallet trucks originating in the PRC.