EU imposes anti-dumping duty on aroma chemical from India

BRUSSELS: The European Union imposed tariffs on a chemical from India used in perfumes and soaps to help Spanish producers compete against cheaper imports.

The duties of as high as 7.5 per cent punish Indian exporters of dihydromyrcenol for selling it in the EU below domestic prices or production costs, a practice known as dumping. The anti-dumping duties are for six months and may be prolonged for five years.

Destilaciones Bordas Chinchurreta SA, Sensient Fragrances SA and Takasago International Chemicals Europe SA, three Spain-based producers, account for more than 40 per cent of EU production of dihydromyrcenol.

They suffered "material injury" as a result of dumping by Indian exporters, the European Commission, the EU's regulatory arm in Brussels, said in the Official Journal on July 28. The duties took effect yesterday across the 27-nation bloc.

Indian dihydromyrcenol exporters expanded their combined share of the EU market to about 17 per cent in the 12 months through September 2006 from less than 1 per cent in 2003, according to the Commission. The three Spanish companies' share of the European market was unchanged at around 34 per cent over the same period, when their dihydromyrcenol businesses became unprofitable, said the regulator.

"The sharply increased presence of dumped imports in recent years caused a strong suppression of the prices," the Commission said. "Non-imposition of measures may lead to discontinuation of dihydromyrcenol production or even closures" in the EU. The three Spanish companies employed a total of about 38 people for dihydromyrcenol production in the 12 months through last September, according to the regulator.