In accordance with Anti-dumping Regulations of the People’s Republic of China, Ministry of Commerce released announcement on Dec 17, 2003, deciding to carry out anti-dumping investigation on imported hydrazine hydrate products originated from Japan, South Korea, the US and France. Ministry of Commerce released final arbitration on Jun 17, 2005, confirming dumping of the imported hydrazine hydrate products originated from Japan, South Korea, the US and France as well as the injury of hydrazine hydrate industry and the causality between dumping and the injury of hydrazine hydrate industry.

After the final arbitration, a part of domestic follow-up enterprises of hydrazine hydrate and overseas major exporter, French company Arkema submitted application to Ministry of Commerce, apply not to impose anti-dumping duties on 100% hydrazine hydrate products.

In accordance with related regulations of Anti-dumping Regulations of the People’s Republic of China, Ministry of Commerce investigated related issues, held opinions presentation meeting of the upstream and downstream of the hydrazine hydrate anti-dumping, and heard opinions of domestic hydrazine hydrate producing enterprises and downstream uses. In addition, Ministry of Commerce carried out field investigation on downstream enterprises of 100% hydrazine hydrate in different industries.

In line with investigation results, Ministry of Commerce believes that the domestic industry can theoretically produce 100% hydrazine hydrate, but has not realized commercial production. In addition, a part of high added value industries of new type among the domestic downstream enterprises of hydrazine hydrate do have demand of 100% hydrazine hydrate for requirements of special production.

For purpose of properly solving related problems, Ministry of Commerce decided to sign price commitment agreement with French exporter Arkema on 100% hydrazine hydrate products in the case of anti-dumping. After some negotiation, the two side signed the agreement on Nov 30, 2006.

The agreement will take effect as from Dec 15, 2006. Ministry of Commerce will terminate the anti-dumping duties on 100% hydrazine hydrate products originated from French Company Arkema, however, continue to impose anti-dumping duties on hydrazine hydrate products with other concentration in accordance with Announcement No.36, 2005 of Ministry of Commerce.

Appendix: Commitment Agreement between Ministry of Commerce and French Company Arkema on Price of 100% Hydrazine Hydrate Products

Ministry of Commerce