(1)

By Implementing Regulation (EU) 2020/1524 (2), the European Commission (‘the Commission’) imposed anti-dumping duties on imports of certain heavyweight thermal paper, originating in the Republic of Korea (‘the original measures’). The investigation that led to the imposition of the original measures will hereinafter be referred to as ‘the original investigation’.

(2)

The anti-dumping duties currently in force are at a rate of 15,8 %.

(3)

Following the publication of a notice of impending expiry (3), the Commission received a request for a review pursuant to Article 11(2) of the basic Regulation.

(4)

The request for review was submitted on 16 July 2025 by the European Thermal Paper Association (‘ETPA’) and its members (‘the applicants’) on behalf of the Union industry of certain heavyweight thermal paper in the sense of Article 5(4) of the basic Regulation. The request for review was based on the grounds that the expiry of the measures would be likely to result in continuation of dumping and recurrence of injury to the Union industry.

(5)

Having determined, after consulting the Committee established by Article 15(1) of the basic Regulation, that sufficient evidence existed for the initiation of an expiry review, on 17 October 2025 the Commission initiated an expiry review with regard to imports into the Union of certain heavyweight thermal paper originating in the Republic of Korea (‘the country concerned’) on the basis of Article 11(2) of the basic Regulation. It published a Notice of Initiation in the Official Journal of the European Union (4) (‘the Notice of Initiation’).

(6)

The investigation of continuation or recurrence of dumping covered the period from 1 July 2024 to 30 June 2025 (‘review investigation period’). The examination of trends relevant for the assessment of the likelihood of a continuation or recurrence of injury covered the period from 1 January 2022 to the end of the review investigation period (‘the period considered’).

(7)

In the Notice of Initiation, interested parties were invited to contact the Commission in order to participate in the investigation. In addition, the Commission specifically informed the applicants, the known producers in the Republic of Korea and the authorities of the Republic of Korea, known importers and users, as well as associations known to be concerned, about the initiation of the expiry and invited them to participate.

(8)

Interested parties had an opportunity to comment on the initiation of the expiry review and to request a hearing with the Commission and/or the Hearing Officer in trade proceedings.

(9)

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

(10)

In the Notice of Initiation, the Commission stated that it had provisionally selected a sample of Union producers. The Commission selected the sample on the basis of the largest representative volume of production and sales of the like product in the Union between 1 July 2024 and 30 June 2025. This sample consisted of three Union producers in two different Member States. Considering the data available at initiation stage, the sampled Union producers accounted for over 50 % of the Union production of the like product and over 70 % of the sales of the like product by Union producers. In accordance with Article 17(2) of the basic Regulation, the Commission invited interested parties to comment on the provisional sample. No comments were received. The sample was confirmed on 30 October 2025. The sample is representative of the Union industry. The Commission instructed the sampled Union producers to reply to the questionnaire that had been made available online (5) on the day of initiation.

(11)

To decide whether sampling was necessary and, if so, to select a sample, the Commission asked unrelated importers to provide the information specified in the Notice of Initiation.

(12)

No unrelated importers provided the requested information and agreed to be included in the sample. Consequently, the Commission decided that sampling was not necessary.

(13)

To decide whether sampling was necessary and, if so, to select a sample, the Commission asked all exporting producers in the Republic of Korea to provide the information specified in the Notice of Initiation. In addition, the Commission asked the Mission of the Republic of Korea to the European Union to identify and/or contact other exporting producers, if any, that could be interested in participating in the investigation.

(14)

No exporting producers in the country concerned provided the requested information and agreed to be included in the sample. Consequently, the Commission decided that sampling was not necessary. No producers in the Republic of Korea cooperated with the investigation.

(15)

On the day of initiation of the investigation, the Commission made available on its website (6) questionnaires for exporting producers, Union producers, unrelated importers in the Union and users in the Union. The Commission requested sampled Union producers to complete the questionnaire intended for them. In addition, the Commission sent a questionnaire to ETPA requesting macro-data about the Union industry.

(16)

Questionnaire replies were received from the sampled Union producers and ETPA.

(17)

The Commission sought and verified all the information deemed necessary for the determination of likelihood of continuation or recurrence of dumping and injury and of the Union interest. Verification visits pursuant to Article 16 of the basic Regulation were carried out at the premises of the following companies:

(18)

The questionnaire reply on macro-data submitted on behalf of the Union industry was verified at the premises of its legal representative in Brussels.

(19)

On 30 June 2026, the Commission disclosed the essential facts and considerations on the basis of which it intended to maintain the anti-dumping duties in force (‘final disclosure’). All parties were granted a period within which they could make comments on the final disclosure.

(20)

Comments were received from the applicants. No other interested party made comments to the final disclosure.

(21)

The comments made by the applicants were considered by the Commission and taken into account, where appropriate. The parties who so requested were granted a hearing.

(22)

Some of the figures presented below are in the form of ranges in order to avoid disclosing confidential information due to the limited number of parties providing such information.

(23)

The product under review is the same as in the original investigation, namely certain heavyweight thermal paper, defined as thermal paper which weighs more than 65 g/m2; which is sold on rolls of a width of 20 cm or more, weighing 50 kg or more (including paper) and with a diameter of 40 cm or more (jumbo rolls); with or without base coat on one or both sides; coated with a thermo-sensitive substance (i.e. a mixture of dye and a developer that reacts and forms an image when heat is applied) on one or both sides; and with or without top coat (‘the product under review’).

(24)

Heavyweight thermal paper is a specialty paper. It has a thermal active coating which reacts to form an image when heat is applied by printers with thermal printheads. Heavyweight thermal paper is mainly used for self-adhesive labels for packaging, but also for tickets and tags.

(25)

The product concerned by this investigation is the product under review originating in the Republic of Korea currently falling under CN codes ex 4809 90 00 , ex 4811 59 00 and ex 4811 90 00 (TARIC codes 4809 90 00 20, 4811 59 00 20 and 4811 90 00 20).

(26)

As established in the original investigation, this expiry review investigation confirmed that the following products have the same basic physical and technical characteristics as well as the same basic uses:

(27)

These products are therefore considered to be like products within the meaning of Article 1(4) of the basic Regulation.

(28)

During the review investigation period, imports of heavyweight thermal paper from the Republic of Korea continued albeit at lower levels than in the investigation period of the original investigation (i.e. from 1 July 2018 to 30 June 2019). According to Table 2 below, imports of heavyweight thermal paper from the Republic of Korea fluctuated. These imports accounted for 2,5 % of the Union market in the review investigation period compared to a 10–11 % market share in the investigation period of the original investigation. In absolute terms, imports from the Republic of Korea amounted to 18 500–20 500 tonnes in the investigation period of the original investigation, whereas such imports were 2 036 tonnes in the review investigation period in the present investigation. In relative terms, the volume of exports to the Union fell by over 80 %, and in absolute terms, the decrease amounted to at least 16 464 tonnes.

(29)

As mentioned in recital (14), no exporters/producers from the Republic of Korea cooperated in the investigation. Therefore, the Commission informed the authorities of the Republic of Korea that, due to the absence of cooperation, the Commission would apply Article 18 of the basic Regulation concerning the findings with regard to the Republic of Korea. The Mission of the Republic of Korea to the European Union was invited to comment on this issue no later than 14 November 2025. The Commission did not receive any comments.

(30)

Consequently, in accordance with Article 18 of the basic Regulation, the findings in relation to the likelihood of continuation of dumping were based on facts available, in particular, official company websites, information in the request for a review and information obtained from the applicants in the course of the review investigation. In the absence of published price lists or cooperation from interested parties other than the applicants during the investigation, the Commission cross-checked relevant information in the complaint against official import statistics and the website of the main known Korean exporting producer.

(31)

As mentioned in the recital above, in the absence of cooperation by the exporting producers in the Republic of Korea, the Commission used facts available to establish the normal value. To this end, the Commission based its findings on data provided by the applicants in the request as subsequently updated. These data were a constructed normal value for the period running from July 2024 to June 2025 based on an estimate of the cost of the relevant factors of production of the like product in the Republic of Korea (namely pulp, chemicals, labour, energy and factory overheads) increased with a reasonable amount for selling, general and administrative (‘SG & A’) costs and with a reasonable profit margin. Price lists on the Korean domestic market were not available in the website of the main known Korean exporting producer. The estimated constructed normal value consisted of an ex works domestic price of EUR 2 060 per tonne.

(32)

In the absence of cooperation by exporting producers from the Republic of Korea, the export price was determined based on the CIF Eurostat price shown in Table 3, adjusted for deferred discounts customary in the sector and then corrected to an ex-works level. The CIF price was reduced by relevant transport costs and ocean insurance costs based on estimates by the applicants.

(33)

The thus resulting ex-works export price for the review investigation period was EUR 1 827,70 per tonne.

(34)

The Commission noted that, in the original investigation, around 30 % of Korean exports to the Union were sold via a related company in the Union acting as an importer (7). The Commission also noted that according to the applicant, certain rebates and discounts (e.g. volume rebates) which occur after the date of importation are customary in the thermal paper sector (8). Considering the finding of dumping in recital (35) as well as the nature of this expiry review investigation, which is focused on finding whether dumping continued during the review investigation period or could reoccur, rather than calculating a new exact dumping margin, the Commission decided, however, that adjustments to the export price for an estimated volume of sales through related parties, in accordance with Article 2(9) of the basic Regulation, and for estimated volume rebates, in accordance with Article 2(10)(c), were unnecessary as it would only result in a decrease of the export price and consequently a higher dumping margin. Hence, the export prices used are the outcome of a conservative approach.

(35)

The Commission compared the normal value and the export price as established in recitals (31)-(33) above. The difference between the normal value and the export price expressed as a percentage of the CIF Union frontier price, duty unpaid, was 11,4 %. Given that the export prices used are the outcome of a conservative approach, as explained in recital (34), the actual dumping margin could be higher. The Commission concluded in any case that dumping continued during the review investigation period.

(36)

Further to the finding of the existence of dumping during the review investigation period, the Commission investigated, in accordance with Article 11(2) of the basic Regulation, the likelihood of continuation of dumping, should the measures be repealed. The following additional elements were analysed: the production capacity and spare capacity in the Republic of Korea and the attractiveness of the Union market versus other markets.

(37)

As a consequence of non-cooperation of the Korean exporting producers, this examination was based on the information available to the Commission, that is information supplied in the request for review and information from other available sources, as noted in recital (30).

(38)

In the original investigation period and in the review investigation period, the only exporting producer from the country concerned was Hansol Paper. According to market intelligence, Hansol Paper was by far the largest producer of the product under review in the Republic of Korea. The request indicated the existence of another producer in the Republic of Korea, a producer that did not cooperate with the present expiry review nor the original investigation with a production capacity of 15 000 tonnes per year.

(39)

Depending on the source and the perspective, in the Republic of Korea, the annual production capacity for the division including heavyweight thermal paper varied. It ranged from 275 000 tonnes (9) to 355 000 tonnes (10) per year. In 2021, thermal paper production in the Republic of Korea amounted to some 240 000 tonnes (11).

(40)

In light of the above, whereas the Commission was unable to quantify the spare capacity in the Republic of Korea for the product under review during the review investigation period, it could establish that production capacity is significant, being as a minimum five times bigger than domestic consumption in the Republic of Korea. Furthermore, Hansol Paper had repeatedly publicly announced in its financial reports its intention to expand its thermal paper business. Hansol Paper can expand its thermal paper production and sales by several means, including by switching capacities from one product group to another. As noted by Hansol Paper itself in the 2024 Hansol Paper Sustainability Report (12), undeniably, Hansol Paper has flexible production facilities. Even if the quantification of the flexibility is not clearly available, the fact that it appeared in the report suggests that the flexibility is not minor and, thus, worth a public announcement. Any expansion of capacity in the Republic of Korea would represent an addition to the Korean thermal paper production, which already amounted to over 200 % the yearly heavyweight thermal paper consumption in the Union capacity in the review investigation period (see Table 1).

(41)

It was estimated that in 2026 heavyweight thermal paper world consumption would reach around 776 000 tonnes. The heavyweight thermal paper domestic market of the Republic of Korea is small (13) (around 23 100 tonnes in 2021). Even when assuming that heavyweight thermal paper could be sold at high prices in the Korean domestic market, there are no indications that the Korean domestic market will meaningfully grow or absorb any spare capacities.

(42)

Therefore, the Korean heavyweight thermal paper industry is export-oriented. Korean export statistics show that the main export markets for thermal paper (all types) are by far the US and Russia. In the US, anti-dumping duties for Hansol Paper’s thermal paper were recently reviewed to 0 % (14). In this context, Hansol Paper continues to expand its global network and solidify its presence as a global paper manufacturer (15).

(43)

Europe and North America together represented over 50 % of the total heavyweight thermal paper consumption. The existence of the anti-dumping measures in the Union did not diminish its attractiveness during the period considered. Even though it was also confronted with the general trend of decreasing (thermal) paper consumption, the Union market was the largest single market for heavyweight thermal paper. In addition, the Union hosts a wide range of heavyweight thermal paper convertors, some acting globally, and customers with corporate social responsibility commitments and other standards that can pay higher prices than other markets. The Union market values a more expensive product mix (namely phenol-free grades) which is not sold in other parts of the world. BPA-containing grades, which are grades cheaper than those used in the Union, are common worldwide. Only the EU, Switzerland, some US states, Japan and South Korea banned the domestic use of BPA-containing grades.

(44)

In spite of the 15,8 % anti-dumping duty rate, yearly volumes exported from the Republic of Korea to the Union often exceeded 4 000 tonnes per year, reaching 7 740 tonnes in 2023. That is less than in the original investigation period, but such volumes are still non-negligible. In addition, Hansol Paper continues to exhibit in relevant label fairs in the Union (16). Hansol Paper’s continued development of trade networks, customer relationships and distribution channels showed its ability and willingness to increase sales and market penetration rapidly should the measures be allowed to expire.

(45)

The investigation showed that the applicable anti-dumping measures have not prevented a continued flow of dumped imports of the product concerned into the Union, though in lower volumes when compared to the original investigation period. The Commission also concluded that, should measures lapse, dumping practices observed during the review investigation are likely to continue and intensify in view of the attractiveness of the Union market in terms of size and pricing, also as compared to other potential export destinations. The Commission therefore concluded that there was a strong likelihood of continuation of dumping should the measures lapse.

(46)

The like product was manufactured by nine producers in the Union during the period considered (17). They constitute the ‘Union industry’ within the meaning of Article 4(1) of the basic Regulation.

(47)

The total Union production during the review investigation period was established at around 158 241 tonnes. The Commission established the figure on the basis of all the available information concerning the Union industry, namely the questionnaire reply provided by ETPA, cross-checked against verified questionnaires replies from sampled Union producers. As indicated in recital (10), three Union producers were selected in the sample representing over 50 % of the total Union production of the like product.

(48)

The Commission established the Union consumption on the basis of (i) ETPA’s questionnaire reply data concerning Union industry’s sales of the like product, cross-checked against the sales volume reported by sampled Union producers in their verified questionnaire replies; and (ii) imports of the product under review as recorded by Eurostat.

(49)

Union consumption developed as follows:

Table 1

Union consumption (tonnes)

(50)

Union consumption decreased over the period considered. The investigation showed that the product under investigation boomed during the COVID-19 pandemic, at a time when online purchases peaked. Following the easing of COVID-19 restrictions, online retail sales with logistics labels printed on heavyweight thermal paper decreased somewhat as of 2023.

(51)

The overall decline in Union consumption (–22 %) over the period considered is distorted by the unusually high consumption in 2022, due to a still relatively high post-COVID-19 demand and the stock-building strategies of some buyers following Russia’s war of aggression of Ukraine. When comparing the level of the Union consumption of the review investigation period with 2023, Union consumption remained relatively stable (–2 %).

(52)

The Commission established the volume of imports on the basis of Eurostat statistics. The market share of the imports was established on the basis of Union consumption.

(53)

Imports into the Union from the country concerned developed as follows:

Table 2

Import volume and market share

(54)

Despite the anti-dumping measures in place, imports from the Republic of Korea have maintained a non-negligible presence in the Union market. The drop in imports can be partly attributed to the fact that the demand for certain former heavyweight thermal paper grades has shifted to lightweight thermal paper grades (thus are now outside the scope of the present investigation) as a result of increased efficiencies in thermal paper manufacturing.

(55)

The market share of Korean imports fluctuated over the period considered. It reached 5,8 % in 2023, a year when imports soared. The Korean market share amounted to 2,5 % in the review investigation period.

(56)

The Commission established the prices of imports on the basis of Eurostat data. The average price of imports into the Union from the country concerned developed as follows:

Table 3

Import prices (EUR/tonne)

(57)

Average import prices went up over the period considered by 5 %. Import prices peaked in 2023, in line with relevant developments in the heavyweight thermal paper market, which is rather a spot market pricewise. In the Union market, 2023 heavyweight thermal paper prices were abnormally high due to elevated pulp prices and to the impact of the on-going Russia war of aggression against Ukraine, as a result of which energy prices and prices of some chemicals needed for thermal paper production went up. In the second part of the period considered, prices of the relevant inputs normalised.

(58)

A comparison between Tables 3 and 8 shows that, year-on-year, Korean import prices were below the average sales price of Union producers in the Union. The Commission noted that Table 3 does not account for the deferred discounts and other rebates that occur after importation and that, according to information in the request, are customary in the sector.

(59)

The Commission determined the price undercutting during the review investigation period by comparing:

(60)

The result of the comparison was expressed as a percentage of the sampled Union producers’ turnover during the review investigation period. On that basis, Korean imports undercut the Union industry’s prices by 4 %.

(61)

Following final disclosure, the applicants stated that the above undercutting analysis would capture the effect of import prices only partially and pointed at price depression and price suppression. That analysis is included under Section 6.1 of this regulation.

(62)

The (aggregated) volume of imports into the Union as well as the market share and price trends for imports of heavyweight thermal paper from other third countries developed as follows:

Table 4

Imports from third countries

(63)

Import volumes from third countries other than the country concerned fluctuated. Their market share ranged between 1,7 % and 4 % over the period considered and was 3,2 % in the review investigation period.

(64)

Average import prices for imports from third countries other than the country concerned decreased over the period considered but remained year-on-year significantly higher than the average import prices for imports from the country concerned and higher than the sales prices of Union producers in the Union market.

(65)

The assessment of the economic situation of the Union industry included an evaluation of all economic indicators having a bearing on the state of the Union industry during the period considered.

(66)

As mentioned in recital (10), sampling was used for the assessment of the economic situation of the Union industry.

(67)

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 reply from ETPA. Those data related to all Union producers. The Commission evaluated the microeconomic indicators on the basis of data contained in the questionnaire replies from the sampled Union producers. Those data thus related to the sampled Union producers. Both sets of data were found to be representative of the economic situation of the Union industry.

(68)

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

(69)

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

(70)

The total Union production, production capacity and capacity utilisation developed over the period considered as follows:

Table 5

Production, production capacity and capacity utilisation

(71)

During the period considered, the Union industry’s production volume decreased by 31 %, with the strongest decrease occurring between 2022 and 2023. The drop seems particularly high because of the Union industry’s very high production level in 2022, which was a response to the peak in Union consumption that year referred to in Section 5.2 above. It is also noted that in 2023 the Union producer Mitsubishi HiTec Paper Europe GmbH sold one of its mills. The sold mill had reduced heavyweight thermal paper production but ultimately ceased production completely end of 2024.

(72)

Production capacity increased by 1 % over the period considered due to developments extraneous to the evolution of consumption. Further to the specific mill matter referred to in the recital above, the evolution of production capacity was influenced by changes in the allocation of capacity and investments in cost savings and increased efficiencies which, altogether, resulted in slight capacity enhancements.

(73)

The decrease of the capacity utilisation rate by 31 % on the whole period mirrors the decrease of the production volume and results from reduced sales opportunities/orders. The 62 % capacity utilisation rate in the review investigation period is too low for a capital-intensive business with high fixed costs.

(74)

The Union industry’s sales volume and market share developed over the period considered as follows:

Table 6

Sales volume and market share

(75)

The Union industry’s sales volume dropped over the period considered in line with the drop in Union consumption. Sales volumes fell however 4 percentage points more than Union consumption in 2023, the year when imports from Korean at low prices was the highest.

(76)

Over the period considered, the Union industry’s market share in the Union remained stable at around 94 %, except for 2023, a year when Korean imports (priced more than 10 % cheaper than the Union industry’s cost of production) peaked. In 2023, the Union industry’s cost of production was abnormally high and it lost significant market share to cheap Korean imports.

(77)

The Union industry’s production volumes dropped over the period considered more than Union consumption. This is partly due to fierce competition in all global markets.

(78)

The Union industry’s sales volume in the Union dropped over the period considered to a similar extent than Union consumption. In the last part of the period considered, Union producers managed to regain the market share lost in 2023 by selling below their cost of production.

(79)

Employment and productivity developed over the period considered as follows:

Table 7

Employment and productivity

(80)

The Union industry cut its workforce by 14 % over the period considered as a result of decreased sales volumes and production and sales prices suppression. The mill closure referred to in recital (71) and restructuring processes undergone within certain Union producers led to direct job losses. Table 7 does not account for indirect jobs lost.

(81)

The drop in productivity over the period considered follows the decrease in Union production, although the decline in productivity is less sharp as Union producers value their employees and endeavoured to limit lay-offs.

(82)

The dumping margin established during the review investigation period was significantly above the de minimis level. At the same time, the level of imports during the review investigation period was non-negligible, representing 2,5 % of Union consumption. Therefore, the impact of the magnitude of the actual margins of dumping on the Union industry was meaningful.

(83)

Continuous unfairly priced imports from the country concerned prevented the Union industry from recovering from the past dumping practices.

(84)

The weighted average unit sales prices of the sampled Union producers to unrelated customers in the Union developed over the period considered as follows:

Table 8

Sales prices and cost of production in the Union (EUR/tonne)

(85)

Sales prices spiked in 2023, but the price increase did not compensate for the rise in the unit cost of production, which was much higher. Sales prices fell in 2024, in line with the normalisation of the costs of major inputs. In the review investigation period, sales prices were almost at the same level as in 2022 and barely above the average unit ex-works sales price in the investigation period in the original investigation (which ranged between 2 060–2 070 EUR/tonne).

(86)

Over the period considered, the unit cost of production increased by 17 %. Production of heavyweight thermal paper involves high fixed costs, thus such an increase is partly due to the drop in capacity utilisation. In addition, the costs related to the main inputs (energy, pulp and some chemicals) overall rose, particularly in 2023. The unit cost of production in the review investigation period was 2 281 EUR/tonne, hence significantly above the unit cost of production in the investigation period in the original investigation (which ranged between 1 880–1 890 EUR/tonne).

(87)

The average labour costs of the sampled Union producers developed over the period considered as follows:

Table 9

Average labour costs per employee

(88)

Union producers endeavoured to keep labour costs under control and fully comply with their commitments as an employer. The stable average labour costs per employee throughout the period considered are the result of a combination of factors, some driving labour costs upwards and some driving them downwards. During the period considered, the average wage per employee increased in line with the yearly increases in labour costs in Germany and Finland (18). Average labour costs however dropped in the case of some Union producers as a result of temporary shutdowns and reduced working time (with reduced labour costs for the Union producer).

(89)

Stock levels of the sampled Union producers developed over the period considered as follows:

Table 10

Inventories

(90)

Despite the Union producers’ efforts to reduce working capital, the closing stocks levels as a percentage of production of the Union industry increased by 15 % over the period considered. Closing stocks as a percentage of production were 13,7 % in the review investigation period, therefore slightly higher than in the investigation period of the original investigation. At that time, closing stocks as a percentage of production ranged between 12–13 %.

(91)

Profitability, cash flow, investments and return on investments of the sampled Union producers developed over the period considered as follows:

Table 11

Profitability, cash flow, investments and return on investments

(92)

The Commission established the profitability of the sampled Union producers by expressing the pre-tax net profit of the sales of the like product to unrelated customers in the Union as a percentage of the turnover of those sales. The profits in 2022 turned into losses in 2023, against the backdrop of a much higher cost of production which could not be passed on to customers, also in a context of significant low-priced imports from Korea. Losses could be kept under control in 2024 although reappeared in the review investigation period as then the Union industry’s average unit cost of production went up, contrary to the average Union industry sales price.

(93)

The net cash flow is the ability of the Union producers to self-finance their activities. The trend in net cash flow followed closely the one of profitability, the sharpest decline of cash flow occurring in 2023 and the review investigation period.

(94)

Investments fell over the period considered. Only one Union producer made major investments in the period 2022-2024 with a view to save costs and increase efficiencies. Otherwise, the bulk of the investments aimed at retaining the existing capacities and replacing necessary production assets. The production of heavyweight thermal paper is an asset-intensive industry and improvements and other investments are being delayed due to the poor profitability.

(95)

The return on investments is the profit in percentage of the net book value of investments. Consistent with the profitability, it was negative in the review investigation period.

(96)

The ability to raise capital differed from Union producer to Union producer. It was severely hampered for a manufacturer undergoing restructuring processes.

(97)

Over the period considered, the Union industry’s injury was material and patent in terms of price-related injury indicators such as profitability or cash flow. The recovery observed in 2022 was halted by a strong rise in the cost of production in 2023 which could not be passed on to customers in the form of price increases. As not all the costs could be recovered in 2023, production volumes were reduced that year but then sales temporarily picked up in 2024, only to drop again in the review investigation period.

(98)

The low profit levels that turned into losses entailed that, overall, the Union industry’s level of investments has been at an injuriously low level. This risks to result in obsolescence of assets, in problems in production and difficulty in complying with environmental targets.

(99)

The production of heavyweight thermal paper is an asset-intensive industry but the Union industry’s capacity utilisation rate remained low due to the limited sales opportunities at sustainable price levels. Sales in the Union fell, which overall mirrored the drop in Union consumption.

(100)

The downturn led to job losses within some Union producers, some experiencing difficulty in their ability to raise capital.

(101)

On the basis of the above, the Commission concluded that the Union industry suffered material injury within the meaning of Article 3(5) of the basic Regulation during the review investigation period.

(102)

In accordance with Article 3(6) of the basic Regulation, the Commission examined whether the dumped imports from the country concerned caused material injury to the Union industry. In accordance with Article 3(7) of the basic Regulation, the Commission also examined whether other known factors could at the same time have injured the Union industry.

(103)

As explained in Section 5.3 above, despite the anti-dumping measures, imports from the Republic of Korea have maintained a presence in the Union market, with a market share of 2,5 % during the review investigation period. Moreover, during the period considered, Korean import prices were below the average sales price of Union producers in the Union and the investigation showed undercutting of 4 %.

(104)

A comparison between the Union industry’s prices and its production costs showed that costs increased at a significantly faster rate than prices. In 2023, as noted in Section 5.5.3.1 above, Union producers were confronted with rising costs of major inputs such as energy and pulp. That year, as explained in Section 5.5.2.1, one mill in the Union had reduced operations before being sold. In 2023, Korean heavyweight thermal paper, which was not subject to the same soaring energy and pulp costs as Union producers, took benefit from the room left by the Union mill sold and rapidly increased its presence in the Union market (see Table 2) at prices 318 EUR/tonne lower than the Union industry’s unit cost of production (see Table 8). As a result, the Union industry ended up making losses (see Table 11). The quick jump in Korean imports in 2023 created a price pressure in the Union market, even though the overall volumes of those imports were still well below the Korean import volumes observed in the investigation period of the original investigation.

(105)

The sustained market share of imports at dumped prices from the Republic of Korea over the period considered placed the Union industry under increasing price pressure. The consequent price suppression is a direct cause of the injury suffered by the Union industry during the review investigation period. The Union industry’s inability to increase prices sufficiently to recoup production costs was attributable to low-priced Korean imports, which would otherwise capture increasingly large shares of the market. In that regard, it is recalled that the thermal paper industry is a capital-intensive industry characterised by high fixed costs. Maintaining market share is accordingly of paramount importance for Union producers.

(106)

The volume of imports from other third countries developed over the period considered as shown in Table 4. The imports of heavyweight thermal paper from third countries other than the Republic of Korea were mainly from Serbia, a country without a known integrated manufacturer of heavyweight thermal paper.

(107)

As noted in Section 5.4 above, the market share of import volumes from third countries other than the country concerned was never above 4 % during the period considered and was 3,2 % in the review investigation period.

(108)

Average import prices for imports from third countries other than the country concerned decreased over the period considered but remained year-on-year significantly higher than the average import prices for imports from the country concerned and higher than the sales prices of Union producers in the Union market.

(109)

Over the period considered, Union consumption decreased by 22 %. That said, and as mentioned in recital (51), between 2023 and the review investigation period the Union consumption remained relatively stable. Nevertheless, the investigation found that the decrease of Union consumption caused injury to the Union industry. It is noted that in the original investigation, the level of consumption in the Union was higher than in the present investigation (20). The situation differs however depending on the application of the product under review (with linerless and e-commerce barcodes/labels applications still growing, unlike, for instance, bank statements).

(110)

The drop in demand dragged down the productivity and profitability of the Union industry. The downturn led to job losses within several Union producers, some experiencing difficulties in their ability to raise capital.

(111)

Heavyweight thermal paper production is an asset-intensive industry, but production was sacrificed due to the limited sales opportunities at sustainable price levels. As shown in Table 8, the Union industry was confronted with a very strong increase of the unit cost of production, linked to soaring energy and major input costs. The loss that the Union industry incurred in the review investigation period was due to the impossibility of increasing the sales prices when costs rose. The loss occurred in a context of significant competition in the Union market (in which Union producers are amongst the main players) and was intensified by global overcapacity.

(112)

In light of the above, the Commission found that while dumped imports from the Republic of Korea caused some injury to the Union industry, the decrease in Union consumption and the increasing costs of production during the period considered also caused material injury to the Union industry. However, the Commission concluded that those factors, individually or collectively, did not attenuate the causal link between the dumped Korean and the injury suffered by the Union industry during the review investigation period.

(113)

In any event, the Commission decided to further assess, in accordance with Article 11(2) of the basic Regulation, whether there would be a likelihood of recurrence of injury originally caused by the dumped imports from the Republic of Korea if the measures against such imports were allowed to lapse.

(114)

In the absence of cooperation from any party in the Republic of Korea, the Commission relied on the information available on file. It examined the production capacity and spare capacity in the country concerned, the attractiveness of the Union market and the impact of the potential import volume and import prices on the Union industry’s situation should the measures be allowed to lapse.

(115)

As described in recitals (39)-(40), Hansol Paper has the capability to increase its allocation of production capacity to benefit the production of heavyweight thermal paper. Indeed, Hansol Paper’s sustainability report noted the possibility for swing capacities that allow to produce different paper types depending on the market situation. Furthermore, production capacity in Korea is significant, being at least two times bigger than Union consumption and several times the domestic consumption in the country concerned.

(116)

As described in recital (43), the Union market is the largest market for heavyweight thermal paper in the world and attractive in terms of price, even if Korean export statistics showed that during the review investigation period the main export destination for Korean imports was the USA, a market for which accessibility improved for Korean parties after the last review of the anti-dumping measures in force.

(117)

Furthermore, as shown in Tables 2 and 3, during the period considered, the import volumes from the country concerned into the Union were non-negligible, while the import prices have decreased since 2023. These import prices are lower than those of the Union industry. Indeed, the undercutting analysis carried out by the Commission in recitals (59)-(60) has shown an undercutting margin of 17,1 % in the review investigation period when excluding the anti-dumping duties. This shows that, if measures are allowed to lapse, Korean imports would cause price pressure on the Union industry that would then lose sales volumes and/or be obliged to lower its sales prices, with the consequent negative impact on profitability.

(118)

On this basis, it was concluded that the absence of measures would in all likelihood result in a significant increase of dumped imports from the Republic of Korea at injurious prices and material injury caused by the dumped imports from the Republic of Korea would be likely to recur.

(119)

In accordance with Article 21 of the basic Regulation, the Commission examined whether maintaining the existing anti-dumping measures would be against the interest of the Union as whole. The determination of the Union interest was based on an appreciation of all the various interests involved, including those of the Union industry, importers and users.

(120)

ETPA members, which represented more than 75 % of the total Union production of the product under review, supported the complaint and cooperated with the investigation. Other Union producers remained silent.

(121)

The maintenance of the measures in force could safeguard employment, promote larger investments and improve the Union industry’s profitability to levels considered normal for this capital-intensive industry.

(122)

The maintenance of the measures would help restore a level playing field in the Union and sends a signal that free trade must happen under competitive and fair conditions.

(123)

In the absence of measures, the Union industry would be fully unprotected from dumped imports from the Republic of Korea, its financial situation would worsen and its viability and prospects could be compromised.

(124)

The Commission therefore concluded that the maintenance of anti-dumping duties would be in the interest of the Union industry.

(125)

No importer came forward or cooperated with the investigation.

(126)

In the original investigation, there was cooperation from one importer that did not express its position as regards measures. In the original investigation, it was concluded that the duties would not harm the importer in question.

(127)

In light of the above, it is considered that the extension of duties will not have a negative effect on importers to the extent that it outweighs the positive effects of measures on the Union industry.

(128)

No user came forward or cooperated with the investigation.

(129)

In the original investigation, five users came forward, out of which one submitted a questionnaire reply. On the basis of the available information, it was concluded that any negative effects derived from the imposition of duties on users would not outweigh the positive effects of measures on the Union industry.

(130)

In light of the above, it is considered that the extension of duties will not have a negative effect on users to the extent that it outweighs the positive effects of measures on the Union industry.

(131)

On the basis of the above, the Commission concluded that there were no compelling reasons of the Union interest against the maintenance of the existing measures on imports of heavyweight thermal paper originating in the Republic of Korea.

(132)

On the basis of the conclusions reached by the Commission on likelihood of continuation of dumping, likelihood of recurrence of injury and Union interest, the anti-dumping measures on certain heavyweight thermal paper from the Republic of Korea should be maintained.

(133)

In view of Article 109 of Regulation (EU, Euratom) 2024/2509 of the European Parliament and of the Council (21) when an amount is to be reimbursed following a judgment of the Court of Justice of the European Union, the interest to be paid should be the rate applied by the European Central Bank to its principal refinancing operations, as published in the C series of the Official Journal of the European Union on the first calendar day of each month.

(134)

The measures provided for in this regulation are in accordance with the opinion of the Committee established by Article 15(1) Regulation (EU) 2016/1036,