Philips and Osram are the two largest producers of integrated electronic compact fluorescent lamps (‘CFL-i’) in the EU. They disagreed on what to do about dumping of these lamps onto the EU market from China. The issue was argued before the General Court and the Court of Justice. Both Courts held that the support of half the Union industry was enough to go ahead.
The Council of the European Union obtained from the Court of Justice of the European Union (‘the Court of Justice’) the dismissal of the appeal brought by Philips Lighting Poland SA and Philips Lighting BV (hereinafter, ‘Philips’) against the ruling of the General Court upholding the validity of Regulation (EC) No 1205/20071 imposing an anti-dumping duty on imports of integrated electronic compact fluorescent lamps (‘CFL-i’) from China. The Court of Justice took the opportunity to clarify the effects of the decrease of the level of support among the Union industry for an anti-dumping complaint, and the concept of ‘major proportion’ within the meaning of Article 4(1) of the basic AD Regulation.
Philips Lighting Poland SA and Philips Lighting BV are two EU producers of CFL-i. At the time of the investigation leading to the adoption of Regulation (EC) No 1205/2007, the other EU producers were Osram, GE Hungary and Sylvania. The imports of CFL-i were subject to the imposition of an anti-dumping duty since 2001.2 In 2006 the Commission initiated an expiry review procedure following the request submitted on behalf of the EU industry. At the beginning of the review procedure, GE Hungary and Osram were in favour of that initiation; Philips indicated its opposition and Sylvania did not take any position. During the expiry review procedure, GE Hungary informed the Commission that it was no longer in favour of the continued imposition of anti-dumping measures, while Sylvania informed that it was no longer in the EU interest to maintain those measures. The level of support of the EU CFL-i producers for the request for that expiry review thus decreased during the procedure, and only Osram (representing 48% of the total EU production of CFL-i) supported the expiry review procedure until the end.
By means of the Regulation (EC) No 1205/2007 the Council extended the anti-dumping duties on imports of CFL-I by one year.
Philips brought an action for the annulment of Regulation (EC) No 1205/2007 before the General Court. Philips argued that the anti-dumping procedure could not be continued in the event of a decrease of the level of support for the complaint below the 50% threshold referred to in Article 5(4) of the Regulation (EC) No 384/96 (‘the basic AD Regulation’). 3 In addition, they claimed that the production of Osram, the only company supporting the expiry review procedure, which accounted 48%, could not be regarded as a ‘major proportion’ of the total Community production for the injury calculations. By its judgment of 11 July 2011, the General Court dismissed the action as unfounded. 4 Philips then appealed that ruling before the Court of Justice seeking to have the ruling of the General Court set aside.
In a judgment from 8 September 2015, the Grand Chamber of the Court of Justice dismissed the appeal as unfounded and confirmed the ruling of the General Court.
The Court of Justice observed that the basic AD Regulation does not provide for any provision regulating the case in which the support of the EU producers for the complaint or the expiry review merely falls during the investigation. Articles 9(1) and 11(5) of the basic AD Regulation only provide that the investigation may continue in case of withdrawal of the complaint or a request of a review. On this basis, the Court of Justice upheld that the Commission may a fortiori continue the investigation where the level of support for a complaint or a request of a review merely decreases during the investigation.
As to the definition of ‘major proportion’ within the meaning of Article 4(1) of the basic AD Regulation, the Court of Justice found that the only relevant threshold is the minimum 25% of the total EU production of the like product produced by the EU industry. Article 4(1) of the basic AD Regulation defines the EU industry by a reference to the ‘major proportion’ of the total EU production ‘as defined in Article 5(4)’. The Court of Justice observed that this cross-reference to Article 5(4) is not present in the definition of ‘domestic industry’ in the WTO Anti-Dumping Agreement. The reference to Article 5(4) is a ‘WTO plus’ provision and does not play any role for the purpose of the definition of the EU industry. Therefore, the EU industry has to be defined having regard to at least 25% threshold of the total production. Finally, the Court of Justice stressed that ‘major proportion’ does not mean ‘majority’ of the EU production.
Finally, although the parties discussed the admissibility in their written pleadings and the oral hearing, the Court of Justice did not take any view on this issue.
The Council was successfully assisted by NCTM team, led by Bernard O'Connor, Managing Partner of the Brussels office, assisted by Sébastien Gubel and Elena Bertolotto, associates.