6. 3. 96 Official Journal of the European Communities No L 56/21 COUNCIL REGULATION (EC) No 385/96 of 29 January 1996 on protection against injurious pricing of vessels THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty establishing the European Community, and in particular Article 113 thereof, Having regard to the proposal from the Commission (!), Having regard to the opinion of the European Parliament (?), ( ( ( 1 2 (1) (2) Whereas multilateral negotiations conducted under the auspices of the Organization for Economic Cooperation and Development led to the conclusion, on 21 December 1994, of an Agreement  respecting  normal  competitive conditions in the commercial shipbuilding and repair industry (hereinafter referred to as ‘the Shipbuilding Agreement’); Whereas it has been recognized in the framework of the Shipbuilding Agreement that the special characteristics of ship-purchase transactions have made it impractical to apply countervailing and anti-dumping duties, as provided under Article VI of the General Agreement on Tariffs and Trade (GATT) 1994, the Agreement on Subsidies and Countervailing Measures, and the Agreement on the Implementation of Article VI of GATT 1994 annexed to the Agreement establishing the World Trade Organization; whereas the need to provide for an effective means of protection against sales of ships below their normal value which cause injury has led to the conclusion of a Shipbuilding Injurious Pricing Code which, together with its Basic Principles, constitutes Annex III to the Shipbuilding Agreement (hereinafter referred to as ‘the IPI Code’); Whereas the text of this IPI Code is mainly based on the Agreement on Implementation of Article VI of GATT 1994, but deviates from this Agreement when warranted by the specific nature of ship-purchase transactions; whereas it is therefore appropriate to transpose the language of the IPI Code into Community legislation, to the extent possible on the basis of the text of Council Regulation (EC) No 384/96 of 22 December 1995 on protection against dumped imports from countries not members of the European Communities (?); 0J No C 13, 18. 1. 1996, p. 10. ) ) O] No C 17, 22. 1. 199. 3) See page 1 of this Official Journal. (4) (7) 9) Whereas the Shipbuilding Agreement and the legislative provisions deriving therefrom are of significant importance for Community law; Whereas, to maintain the balance of rights and obligations which the Shipbuilding Agreeement establishes, action should be taken by the Community against any injuriously priced vessel whose sale at less than normal value causes injury to the Community industry; Whereas, vis-a-vis shipbuilders from Parties to the Shipbuilding Agreement, the sale of a vessel may be subject to an investigation by the Community only when the buyer of the vessel is a Community buyer, and provided the ship is not a military vessel; Whereas it is desirable to lay down clear and detailed rules on the calculation of normal value; whereas in particular such value should where possible be based on a representative sale of a like vessel in the ordinary course of trade in the exporting country; whereas it is expedient to define the circumstances in which a domestic sale may be considered to be made at a loss and may be disregarded and in which recourse may be had to sale of a like vessel to a third country or to constructed normal value; whereas it is also desirable to provide for a proper allocation of costs, even in start-up situations; whereas it is also necessary, when constructing normal value, to indicate the methodology that is to be applied in determining the amounts for selling, general and administrative costs and the profit margin that should be included in such value; Whereas, in order to be able to apply correctly the new instrument for combating injurious pricing, the Commission must take all necessary steps to ascertain, in the large conglomerates and holdings of third countries, the validity of accounting charges when the cost price structure needs to be estimated; Whereas, when determining normal value for non-market economy countries, it appears prudent to set out rules for choosing the appropriate market-economy third country that is to be used for such purpose and, where it is not possible to find a suitable third country, to provide that normal value may be established on any’ other reasonable basis;