Dear X,
On 24 June 1998 you lodged, on behalf of a German company, a complaint against a Commission Decision terminating an anti-dumping procedure. Further information regarding your complaint was provided by you in your letter of 6 July 1998.
On 14 July 1998 I forwarded the complaint to the European Commission for its comments. The Commission sent its opinion on 23 September 1998. On 30 November 1998, you sent me your observations on the Commission's opinion.
On 27 May 1999, I addressed a request for further information to the Commission. The Commission replied on 27 July 1999.
On 27 September 1999, you sent me your observations on the Commission's letter of 27 July 1999.
I am now writing to you to let you know the results of the inquiries that have been made.

THE COMPLAINT

The complainant, a German company, is one of only two companies in the whole world manufacturing the product in question.
The complainant makes the following allegations:
1) The Commission's assessment of the facts was wrong;
2) The Commission manipulated the evidence and
3) Submissions and evidence were either wrongly interpreted or deliberately ignored by the Commission.
These allegations are based on the following claims made by the complainant:
The definition of the relevant product was unsatisfactory and should have been extended. There had been imports into the EC from third countries during the relevant period and the Commission had failed to consider the relevant evidence or inquire into the matter. There had been offers from the People's Republic of China to supply the relevant product to customers in the EC. The Commission's allegation that the Chinese producer produced several other products and was therefore not likely to be interested in the product concerned was not supported by the evidence used. There was no evidence to support the argument that a switch to the production of the relevant product would entail substantial costs for the Chinese producer. The fact that the Chinese exporter had asked for a review of its undertaking showed that it did have an interest in exporting to the EC.

THE INQUIRY

The Commission's opinion
In its opinion, the Commission made the following comments with regard to the complaint:
According to the undertaking reports submitted by the exporter and the Eurostat figures available to the Commission, there had been no imports of the product concerned since 1989. During the review investigation, the complainant had refused to provide some essential information to the Commission. The Commission had examined all the evidence available and come to the conclusion that the anti-dumping measures were no longer warranted on the basis of the following facts: First, there had been a major diversification from the product concerned due to the introduction of substitute products. This fall in demand was the principal cause of any injury the complainant may have suffered. This conclusion was reinforced by the absence of imports since 1989. Second, although production and sales had fallen, prices for the product concerned had shown some relative improvement and the price for the main raw material had fallen. The complainant had thus been able to reach a satisfactory degree of profitability. Finally, there had been no likelihood of a recurrence of dumping or injury if the anti-dumping measures were allowed to lapse.
As to the allegedly wrong assessment of facts, the complainant's refusal to provide certain essential information had left the Commission with no option other than to use the information already in the file. The complainant had not produced any evidence that the Commission's findings were wrong.
The same largely applied to the allegation according to which the Commission had manipulated the evidence. It was reasonable to assume that, since there had been no imports since 1989, any problems which the complainant might have experienced had diminished, if not disappeared. Any suggestion that the evidence was manipulated to deliberately engineer an outcome unfavourable to the complainant thus could not be accepted.
As to the third allegation, the failure of the complainant to provide information had to be regarded as essential. It was difficult to neglect or misinterpret information that had not been provided. The evidence which had been provided had been irrelevant. The widening of the inquiry to differently defined products would have required a new investigation based on a complaint. The evidence submitted relating to imports had been rejected as insufficient. The purpose of anti-dumping measures was not to prevent trade, but to remove injury caused by unfairly traded goods. The evidence submitted contained no indication that the imports referred to were either dumped, in sufficient volumes or at prices that could be considered to be injurious, or in contravention of the terms of the undertaking. Neither had there been any acceptable demonstration that the alleged imports were of Chinese origin. Certain information provided by the complainant could not be taken into account because it referred to a period outside that investigated. No relevant evidence had been deliberately neglected or misinterpreted.
The Commission also stressed that the complainant could have attacked the contested decision before the Community courts.
The complainant's observations
In its observations, the complainant maintained its complaint. It stressed that in its view the fact that the relevant product had been imported into the EC during the period concerned was also confirmed by the Eurostat figures themselves.

FURTHER INQUIRIES

Request for further information
On the basis of the above, the Ombudsman considered that he needed further information in order to proceed with the examination of the complaint. In his letter of 27 May 1999, the Ombudsman therefore asked the Commission
(1) to indicate whether it considered that the product concerned had (or had not) been imported to the EC since 1989 and, if so, why it had considered that it was not established that these imports were of Chinese origin, and to comment on the complainant's claim that the Eurostat figures (and the figures of the German Statistical Office) showed that such imports had in fact taken place, and to produce the Eurostat figures on which it relied,
(2) to comment on the complainant's allegation that the various products referred to by the Commission were not manufactured by the Chinese producer but by another company and
(3) to indicate the evidence on which the Commission had relied to support its conclusion that in view of the costs involved for switching production to the product concerned and given the higher rentability of other similar products, exports of the product concerned to the EC would be unlikely.
In its reply of 27 July 1999, the Commission made the following statements:
The Commission considered that there had been no imports of the product concerned since 1989. The customs codes under which the relevant product fell were "ex" codes, which meant that these codes did not only cover the product concerned but included also other products. A more precise analysis required the use of the Taric codes (official Eurostat codes used by the Commission in the administration of anti-dumping measures). On the basis of the 10-digit Taric codes, it appeared that some minor quantities had been imported into the Community from China under the relevant codes. However, these quantities were negligible and could not be interpreted as evidence of a likelihood of recurrence of material injury to the Community producer. Furthermore, price and quantity relationships were so different from those observed in the investigation, that the Commission concluded that the product imported under these 10-digit codes was not the product covered by the investigation. The complainant had failed to show otherwise. There was no contradiction in the Commission's comments of 23 September 1998. When referring, on page 5 of these comments, to imports which were "either dumped, in sufficient volumes or at prices that could be considered to be injurious, or in contravention of the terms of the undertaking", the reference was to the figures which the complainant had claimed were evidence of dumped imports, not to the Eurostat figures available to the Commission which showed no imports of the product concerned from China.
The absence of imports had also been confirmed by the verification visit carried out at the premises of the unrelated importer referred to at paragraph 5 (c) of the contested Decision.
The complainant had submitted statistics from the German Federal Statistical Office which contained an 11-digit code for imports from China. The Commission had been unable to accept these figures since the complainant had failed to show that the German statistics referred to the relevant product.
The information on the products manufactured by the Chinese producer and on the costs of switching production had been in the non-confidential file, had therefore been seen by the complainant and had not been challenged by the latter.
The complainant's observations
In his observations, the complainant challenged the arguments put forward by the Commission. In its view the Commission ought to have examined all imports to the EU from third countries. The complainant also asked the Ombudsman to take personal steps against the Commission officials in charge of the anti-dumping proceeding since they had failed to comply with their duties.

THE DECISION

1 Wrong assessment of the facts and wrong interpretation of submissions
1.1 The complainant claims that the Commission, when deciding to allow the anti-dumping duties to expire, wrongly assessed the relevant facts. It also claims that the Commission wrongly interpreted or deliberately ignored evidence or submissions which it had made. Although the complainant has raised two separate allegations in this respect, the substance of these allegations appears to be practically identical. It is thus appropriate to examine these allegations together.
1.2 The complainant claims in particular that the Commission failed to take into account the fact there had been imports into the EC from third countries during the relevant period. It further claims that the Commission had also failed to prove its allegation that the Chinese producer produced several other products and its argument that a switch to the production of the relevant product would entail substantial costs for the Chinese producer and was therefore unlikely.
1.3 The Commission replies that there have been no imports of the product concerned from China since 1989 and that it has examined all the evidence available before coming to the conclusion that the maintaining of the anti-dumping measures was no longer justified.
1.4 The complainant originally also objected to the Commission's refusal to extend the scope of the anti-dumping measures to other products. However, the complainant does not appear to insist on this point any longer. Even if it were otherwise, the Commission's view that such an extension would have required a (new) complaint appears reasonable.
1.5 It is good administrative practice for the Commission to take account of all relevant evidence when deciding as to whether or not to continue anti-dumping measures. In the contested Decision, the Commission claimed that there have been no imports of the product concerned since 1989. The Commission also claimed that the complainant had not produced sufficient evidence to corroborate its allegation that the anti-dumping measures had been circumvented by imports transiting through third countries like Switzerland. Although the Commission also referred to other factors which are not seriously in dispute between the parties (namely the decline in demand) in order to support its conclusion that the anti-dumping duties should not be continued, it is clear that the absence of imports played an essential role in this context.
1.6 In order to support its allegation that, contrary to what the Commission believed, there had indeed been such imports, the complainant provided the Commission with statistics from the German Federal Statistical Office which showed imports from China. The Commission claims that these figures are irrelevant since they refer to another product. However, at first sight the evidence submitted would appear to confirm that a product matching the definition of the relevant product was imported to the EC from China during the relevant period. The argument put forward by the Commission thus fails to convince.
1.7 The Commission argues, however, that a more precise analysis requires the use of the so-called Taric codes. Even if this was correct, the fact remains that the Eurostat statistics which the Commission has submitted, further to a request from the Ombudsman, do show imports from China. In its reply to the request for further information, the Commission admits that imports have taken place but claims that the "price and quantity relationships" of these imports were such that the product imported under these codes could not have been the product covered by the investigation. However, the Commission has not specified what exactly these "price and quantity relationships" were which it claims to have considered here. In addition to that, the contested Decision did not contain any reference to such considerations. Finally, and most importantly, the Commission thus effectively claims that even these statistics are not sufficient to ascertain the nature of the product concerned. However, the Commission itself claims that these statistics are used for the administration of anti-dumping measures. The Commission has not offered any explanation to try and resolve this contradiction. In any event, it has to be noted that the Eurostat statistics provided by the Commission appear to be prima facie evidence of the fact that the relevant product was imported to the EC from China during the relevant period. The argument put forward by the Commission therefore fails to convince.
1.8 The Commission argues that the quantities concerned were "minor" and were considered as "negligible". The Ombudsman is not in a position to resolve this issue on the basis of the figures provided. However, it needs to be pointed out that the said argument is not to be found anywhere in the contested Decision. On the contrary, the Decision categorically states that there have been "no imports" and that the complainant has been enjoying a monopoly position in the EC. It cannot be considered to be good administrative practice to base a decision not on the arguments mentioned therein but on arguments which are only disclosed to an interested party when the latter has lodged a complaint with the Ombudsman. The same applies to the allegation that the absence of imports had been confirmed by the verification visit carried out at the premises of the unrelated importer. This allegation appears for the first time in the Commission's reply to the Ombudsman's request for further information.
1.9 The statistics from the German Federal Statistical Office provided by the complainant also show what appear to be substantial imports from Switzerland. In the contested Decision, the Commission claimed that these imports were irrelevant. There is no evidence to support this claim. In its opinion on the complaint, the Commission claims that there has been no acceptable demonstration that the alleged imports were of Chinese origin. This argument does not appear to have been used in the Decision.
1.10 Since the evidence relating to these imports has been submitted to the Commission by the complainant, the Commission's allegation that the complainant has failed to provide essential information is irrelevant in this context.
1.11 In so far as the complainant's claim that the Commission wrongly assumed that the Chinese producer also produced several other products is concerned, it has to be pointed out that the brochure of the Chinese producer submitted by the complainant itself referred to the production of a different type of product. In these circumstances the Ombudsman is of the view that there is not enough evidence to show that the Commission made a mistake when it relied on the fact that the Chinese producer manufactured a number of products other than the relevant product.
1.12 Finally, in reply to the complainant's claim that there was no evidence to support the claim that a switch to the production of the relevant product would entail substantial costs for the Chinese producer and thus be unlikely, the Commission alleges that the relevant information has been contained in the non-confidential file, had thus been accessible to the complainant and has not been challenged at the time. However, even if the complainant should have seen the relevant documents (which it denies), the fact remains that in its letter of 30 March 1998 it did challenge the view of the Commission. The argument relied on by the complainant in this context is not devoid of persuasiveness. However, the Commission does not appear to have taken this argument into account when adopting its Decision.
It is good administrative practice that the Commission should, when adopting decisions, consider all the relevant facts and arguments. In the present case, the Commission has failed to take proper account of the evidence and the complainant's arguments in so far as imports from third countries and the costs for the Chinese producer of switching its production to the relevant product are concerned. The Ombudsman concludes that this failure constitutes an instance of maladministration. The Ombudsman wishes to add, however, that this conclusion is without prejudice to the question as to whether the decision of the Commission is correct in so far as its substance was concerned. It can of course not be excluded that the Commission, after a proper examination of all the relevant evidence and submissions, could have reached the same conclusion as it did in its contested Decision.
2 Manipulation of evidence
2.1 The complainant alleges that the Commission has manipulated the evidence when adopting the contested Decision.
2.2 The Commission argues that there is nothing to suggest that the evidence was manipulated by the Commission in order to deliberately engineer an outcome unfavourable to the complainant.
2.3 The Ombudsman considers that although the Commission in his view committed a mistake by failing to take proper account of the evidence and the complainant's arguments in so far as the two issues referred to above are concerned, there is no evidence which would suggest that the Commission deliberately manipulated the evidence.
2.4 On the basis of the above, there appears to have been no maladministration on the part of the Commission in so far as the second allegation put forward by the complainant is concerned. The Ombudsman therefore considers that there is no need for him to consider the request by the complainant, in its letter of 20 September 1999, to take steps against the Commission officials in charge of the anti-dumping procedure.
3 Conclusion
On the basis of the European Ombudsman's inquiries into this complaint, it appears necessary to make the following critical remark:

It is good administrative practice that the Commission should, when adopting decisions, consider all the relevant facts and arguments. In the present case, the Commission has failed to take proper account of the evidence and the complainant's arguments in so far as imports from third countries and the costs for the Chinese producer of switching its production to the relevant product are concerned. The Ombudsman concludes that this failure constitutes an instance of maladministration.

Given that this aspect of the case concerns a specific event in the past, it is not appropriate to pursue a friendly settlement of the matter. The Ombudsman therefore closes the case.
The President of the European Commission will also be informed of this decision.
Yours sincerely,
Jacob SÖDERMAN