MOFCOM Announcement No.91 of 2018 on Filing of Countervailing Investigation against Imports of 7-phenylacetamido-3-chloromethyl-3-cephem-4-carboxylic Acidpmethoxybenzyl Ester Originating in India

Date: 2018-12-03 02:08:24, Source: MOFCOM, Today/Total Visits : 1/27

Announcement of Ministry of Commerce of the People's Republic of China
2018 No.91


The Ministry of Commerce of the People’s Republic of China (hereinafter referred to as the “MOFCOM” or the "Ministry of Commerce") received, on October 10, 2018, a written petition for countervailing investigation formally submitted by Ningbo Renjian Pharmaceutical Co., Ltd. (hereinafter referred to as “the Applicant”) on behalf of domestic industry of 7-phenylacetamido-3-chloromethyl-3-cephem-4-carboxylic acidpmethoxybenzyl ester, in which the Applicant requested a countervailing investigation to be conducted against imports of 7-phenylacetamido-3-chloromethyl-3-cephem-4-carboxylic acidpmethoxybenzyl ester originating in India. According to Article 16 of the Countervailing Regulations of the People's Republic of China, on October 30, 2018, the MOFCOM invited the Indian government for discussion on matters related to the countervailing investigation. The Indian government submitted written comments on November 16, 2018.

In accordance with relevant provisions of the Countervailing Regulations of the People's Republic of China, the MOFCOM conducted an investigation into the qualification of the Applicant, relevant situations of the products in question and the products of the same kind in China, impact of the imported products on domestic industry and the relevant situations of countries (regions) involved.

According to the evidence provided by the Applicant and the preliminary review of the Ministry of Commerce, the total output of 7-phenylacetamido-3-chloromethyl-3-cephem-4-carboxylic acidpmethoxybenzyl ester of the Applicant in 2015, 2016 and 2017 accounts for more than 50% of that of the same kind in China, and therefore the provisions of Article 11 and Article 13 of the Countervailing Regulations of the People's Republic of China on applying by domestic industry for countervailing investigation are met.

Name of the Product under Investigation: imports of 7-phenylacetamido-3-chloromethyl-3-cephem-4-carboxylic acidpmethoxybenzyl ester In the meanwhile, it is claimed in the petition, that the products entering into Chinese market soar with price going up after price decline, and therefore cut down the prices of similar products in the domestic market, thus leading to lower market share, decline of the output, rate of operation and pretax profit as a whole, and substantial damages to domestic industry. Moreover, there are causal links between the subsidies granted to the underlying products and the substantive injuries suffered by the domestic industry. Upon review, the MOFCOM believes that the application contains the contents and relevant evidence as required in Article 14 and Article 15 of the Countervailing Regulations of the People's Republic of China for a countervailing investigation.

As per the above-mentioned results, the MOFCOM decides, according to Article 16 of the Countervailing Regulations of the People's Republic of China, to file countervailing investigation against imports of 7-phenylacetamido-3-chloromethyl-3-cephem-4-carboxylic acidpmethoxybenzyl ester originating in India as of November 26, 2018. Relevant matters are hereby announced as follows:

I. Filing of Investigation and Investigation Period

As of the issue date hereof, the MOFCOM files a countervailing investigation against imports of 7-phenylacetamido-3-chloromethyl-3-cephem-4-carboxylic acidpmethoxybenzyl ester originating in India. The countervailing investigation period determined upon the examination is from October 1, 2017 to September 30, 2018, and the investigation period for industrial damages is from January 1, 2015 to September 30, 2018.

II. Products under Investigation and Scope of Investigation

Scope of investigation: imports of 7-phenylacetamido-3-chloromethyl-3-cephem-4-carboxylic acidpmethoxybenzyl ester originating in India.

Name of the Product under Investigation: imports of 7-phenylacetamido-3-chloromethyl-3-cephem-4-carboxylic acidpmethoxybenzyl ester.

Name in English:

7-phenylacetamido-3-chloromethyl-3-cephem-4-carboxylic acidpmethoxybenzyl ester
Chemical formula:C24H23ClN2O5S
Chemical structural formula:

Physical and chemical characteristics: it is usually white or white-like crystalline powder solid and soluble in N, n-dimethyl formamide and dichloromethane. Its fusion point is about 153-160°C.

Main purpose: 7-phenylacetamido-3-chloromethyl-3-cephem-4-carboxylic acidpmethoxybenzyl ester is the third parent nucleus only after 7-ADCA and 7-ACA. It can be used in the synthesis of dozens of cephalosporin products, especially, the third and the fourth generation of cephalosporin products, such as Cefixima, cefdinir, cefprozil, cefditoren pivoxil, etc. In addition, it can also be used in the synthesis of a great many of new-style monobactams antibiotic and cephalosporins, such as cefditoren pivoxil.

The product is listed under tariff number of 29349960 in the Customs Import and Export Tariff of the People’s Republic of China. Other products under the above tariff number fall beyond the scope of this investigation.

III. Countervailing Investigation

In the application submitted, the Applicant claimed that the Indian government provided a total of 20 subsidies to 7-phenylacetamido-3-chloromethyl-3-cephem-4-carboxylic acidpmethoxybenzyl ester industry in India. After preliminary review and considering the written comments submitted by the Indian government on November 16, 2018, the MOFCOM decided to investigate the following subsidies:

(1) From Indian Central Government

1. promotion of capital and goods export
2. export of commodity
3. exemption of enterprises in special economic zones from tariffs on goods import
4. exemption of enterprises in special economic zones from consumption tax on goods purchase
5. exemption of enterprises in special economic zones from central sales tax
6. exemption of enterprises in special economic zones from service tax
7. exemption of enterprises in special economic zones from electricity tax and surtax
8. exemption of export-oriented enterprises from customs duties on imported goods
9. exemption of export-oriented enterprises from central consumption tax on goods purchase
10. refund of central consumption tax on goods purchased by export-oriented enterprises at home.
11. preauthorized projects
12. duty-free import authorization
13. deduction or exemption of income tax on research and development expenses
14. tax deduction or exemption on investment projects covered by Article 32 AC in the Income Tax Law
15. export credit interest subsidies

(II) From Government of Andhra Pradesh, India
1. refund of land transaction stamp duty
2. refund of enterprise land expenses 
3. refund of land conversion fees for small and medium-sized enterprises
4. fixed electricity fee subsidy
5. Multiple subsidies for small and micro enterprises

IV. Registration for Participating in the Investigation

Any interested party and governments of related countries (regions) may register with the Trade Remedy and Investigation Bureau of the Ministry of Commerce for participating in this round of countervailing investigation within 20 days after the date of release hereof. Interested parties and governments of related countries (regions) participating in the investigation are required to provide basic identity information, quantity and amount of the products under investigation exported to or importing from China, quantity and amount of similar products produced and sold and relationship and other illustrative materials based on the Reference Format of the Registration to Participate in the Investigation, which can be downloaded from the related website (URL attached, the same below).

For the purposes hereof, the interested parties are individuals and organizations as defined in Article 19 of the Regulations of the People's Republic of China on Countervailing.

V. Access to Public Information

The interested parties and governments of related countries (regions) can download the unclassified text of the application submitted by the applicants through the relevant websites, or search, read, transcribe and copy the same in the MOFCOM Trade Relief Public Information Office (Tel.: 0086-10-65197878). In the process of investigation, the interested parties and governments of related countries (regions) can refer to public information about the case through the relevant websites, or search, read, transcribe and copy the same in the MOFCOM Trade Relief Public Information Office.

VI. Comments

If any interested party or government of related countries (regions) has any comments on the product scope, the qualification of the Applicant, countries (regions) covered by the investigation regarding this investigation and other related questions, it may submit its opinions in written form to Trade Remedy and Investigation Bureau of the Ministry of Commerce within 20 days after the date of release hereof.

VII. Investigation Methods

In accordance with Article 20 of the Countervailing Regulations of the People's Republic of China, the MOFCOM may get to know the related situation and conduct investigation via questionnaire, sampling, hearing, site investigation and other manners from the interested parties and governments of related countries (regions).

In order to obtain the information required for the investigation of this case, the MOFCOM usually issues questionnaires within 10 working days from the deadline for registering for participating in the investigation as prescribed herein, to overseas importers or producers, domestic manufacturers and importers and governments of related countries (regions) set forth in the application. Interested parties and governments of related countries (regions) registered can download the questionnaire from the related websites.

Information inquired in the Questionnaire for Foreign Exporters or Producers of the Countervailing Case of 7-phenylacetamido-3-chloromethyl-3-cephem-4-carboxylic Acidpmethoxybenzyl Ester includes such matters as organization and operation of the company, affiliates, production costs, sales and other information as well as details of all specific subsidies covered by the investigation. The information inquired in the Questionnaire for Domestic Producers of the Countervailing Case of 7-phenylacetamido-3-chloromethyl-3-cephem-4-carboxylic Acidpmethoxybenzyl Ester includes the basic information of the company, details of the domestic products of the same kind, operation and relevant information, financial and relevant information as well as other issues required to be stated. The information inquired in the Questionnaire for Domestic Importers of the Countervailing Case of 7-phenylacetamido-3-chloromethyl-3-cephem-4-carboxylic Acidpmethoxybenzyl Ester includes the basic information of the company, the trading information of the products under investigation and relevant information. The information inquired in the Questionnaire for Domestic Importers of the Countervailing Case of 7-phenylacetamido-3-chloromethyl-3-cephem-4-carboxylic Acidpmethoxybenzyl Ester includes the information on the products under investigation, the industry, management structure and policies as well as details of all specific subsides covered by the investigation.

Other interested parties and governments of related countries (regions) that do not register for participating in the investigation can download the questionnaire from the related websites, or obtain the same from the Trade Remedy and Investigation Bureau of the Ministry of Commerce and fill in the same as required.

All companies and governments of related countries (regions) are required to submit complete and accurate answers within the time specified. The reply shall contain all information required in the questionnaire.

VIII. Submission and Processing of Confidential Information

Where it is necessary to keep confidential the information submitted by the interested parties and governments of related countries (regions) to the MOFCOM, they may request the MOFCOM to make confidential treatments and explain the reasons. If the MOFCOM agrees on their request, the interested parties and governments of related countries (regions) applying for confidentiality shall provide non-confidential summary of the confidential information at the same time. Non-confidential summary shall contain sufficiently meaningful information to make other interested parties have a reasonable understanding of the confidential information. If non-confidential summary cannot be provided, reasons shall be made clear. If the interested parties or governments of related countries (regions) do not require for confidential treatment for the information they have submitted, the MOFCOM will consider the said information as public information.

IX. Consequences of Non-cooperation

In accordance with Article 21 of the Countervailing Regulations of the People's Republic of China, when the MOFCOM makes an investigation, an interested party and government of related countries (regions) shall faithfully reflect situations and provide relevant materials. If an interested party or government of related countries (regions) fails to do so, fails to provide necessary information within a reasonable time, or seriously impedes an investigation in any other way, the MOFCOM may give a ruling according to facts already obtained.

X. Investigation Period

This investigation starts on November 26, 2018, and usually ends prior to November 26, 2019; however, the investigation can be extended to May 26, 2020 under special circumstances.

XI. Contact Information

Address: No. 2 Dong Chang'an Avenue, Beijing, China
Postal code: 100731
Trade Remedy and Investigation Bureau of the Ministry of Commerce
Tel.: 0086-10-65198420, 65198180
Fax: 0086-10-65198172
Related websites: Trade Remedy and Investigation Bureau sub-website of the website of the Ministry of Commerce (http://trb.mofcom.gov.cn)
China Trade Remedy Information Networkhttp://www.cacs.mofcom.gov.cn)


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