[Federal Register Volume 64, Number 207 (Wednesday, October 27, 1999)]
[Notices]
[Pages 57847-57850]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-28064]
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DEPARTMENT OF COMMERCE
International Trade Administration
[A-580-805]
Final Results of Expedited Sunset Review: Industrial
Nitrocellulose From the Republic of Korea
AGENCY: Import Administration, International Trade Administration,
Department of Commerce.
ACTION: Notice of final results of expedited sunset review: Industrial
Nitrocellulose from the Republic of Korea.
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SUMMARY: On June 1, 1999, the Department of Commerce (``the
Department'') initiated a sunset review of the antidumping order on
industrial nitrocellulose from the Republic of Korea (64 FR 29261)
pursuant to section 751(c) of the Tariff Act of 1930, as amended (the
``Act''). On the basis of a notice of intent to participate and
adequate substantive response filed on behalf of a domestic interested
party and inadequate response (in this case, no response) from
respondent interested parties, the Department determined to conduct an
expedited review. As a result of this review, the Department finds that
revocation of the antidumping duty order would be likely to lead to
continuation or recurrence of dumping at the levels indicated in the
Final Results of Review section of this notice.
FOR FURTHER INFORMATION CONTACT: Eun W. Cho or Melissa G. Skinner,
Office of Policy for Import Administration, International Trade
Administration, U.S. Department of Commerce, 14th Street and
Constitution Avenue, NW., Washington, D.C. 20230; telephone: (202) 482-
1698 or (202) 482-1560, respectively.
EFFECTIVE DATE: October 27, 1999.
Statute and Regulations
This review was conducted pursuant to sections 751(c) and 752(c) of
the Act. The Department's procedures for the conduct of sunset reviews
are set forth in Procedures for Conducting Five-Year (``Sunset'')
Reviews of Antidumping and Countervailing duty Orders, 63 FR 13516
(March 20, 1998) (``Sunset Regulations'') and 19 CFR Part 351 (1998) in
general. Guidance on methodological or analytical issues relevant to
the Department's conduct of sunset reviews is set forth in the
Department's Policy Bulletin 98:3--Policies Regarding the Conduct of
Five-year (``Sunset'') Reviews of Antidumping and Countervailing Duty
Orders; Policy Bulletin, 63 FR 18871 (April 16, 1998) (``Sunset Policy
Bulletin'').
Scope
The product covered by this order is industrial nitrocellulose
(``nitrocellulose'') from the Republic of Korea. Industrial
nitrocellulose is a dry, white, amorphous synthetic chemical with a
nitrogen content between 10.8 and 12.2 percent, and is produced from
the reaction of cellulose with nitric acid. Industrial nitrocellulose
is used as a film-former in coatings, lacquers, furniture finishes, and
printing inks.
[[Page 57848]]
The scope of this order does not include explosive grade
nitrocellulose, which has a nitrogen content greater than 12.2 percent.
Industrial nitrocellulose is currently classifiable under Harmonized
Tariff Schedule (``HTS'') item number 3912.20.00. The HTS item number
is provided for convenience and customs purposes only. The written
description remains dispositive.
History of the Order
The antidumping duty order on nitrocellulose from the Republic of
Korea was published in the Federal Register on July 10, 1990 (55 FR
28266).1 In that order, the Department determined that the
weighted-average dumping margin for all entries of the subject
merchandise was 66.30 percent.2 Since that time, the
Department has completed one administrative review.3 We note
that, to date, the Department has not issued any duty absorption
findings in this case. The order remains in effect for all
manufacturers and exporters of the subject merchandise.
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\1\ See Antidumping Duty Order: Industrial Nitrocellulose from
the Republic of Korea, 55 FR 28266 (July 10, 1990).
\2\ However, the underlying investigation dealt with only one
Korean company, Miwon Company, Ltd. (``Miwon'').
\3\ See Industrial Nitrocellulose From the Republic of Korea;
Notice of Final Results of Antidumping Duty Administrative Review,
63 FR 60302 (November 9, 1998).
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Background
On June 1, 1999, the Department initiated a sunset review of the
antidumping duty order on nitrocellulose from the Republic of Korea
(``Korea'') (64 FR 29261), pursuant to section 751(c) of the Act. The
Department received a Notice of Intent to Participate on behalf of the
petitioner Hercules Incorporated (``Hercules''), on June 9, 1999,
within the deadline specified in section 351.218(d)(1)(i) of the Sunset
Regulations. Hercules asserts that it is not related to a foreign
producer, foreign exporter, or domestic importer of the subject
merchandise and that it is not an importer of the subject merchandise
except on an occasional spot basis. (See Hercules' June 9, 1999 Intent
to Participate at 2.)
We received a complete substantive response from Hercules on July
1, 1999, within the 30-day deadline specified in the Sunset Regulations
under section 351.218(d)(3)(i). Hercules claims interested party status
under section 771(9)(C) of the Act as a U.S. manufacturer, producer,
and wholesaler of the subject merchandise. In its substantive response,
Hercules indicates that it is the sole remaining U.S. producer of
nitrocellulose, was the petitioner in the original investigation, and
has participated in the administrative review proceeding. (See
Hercules' July 1, 1999 Substantive Response at 1-2.)
We did not receive a substantive response from any respondent
interested party to this proceeding. Consequently, pursuant to section
351.218(e)(1)(ii)(C) of the Sunset Regulations, the Department
determined to conduct an expedited, 120-day, review of this order.
In accordance with section 751(c)(5)(C)(v) of the Act, the
Department may treat a review as extraordinarily complicated if it is a
review of a transition order--an order which was in effect on January
1, 1995. See section 751(c)(6)(C) of the Act. The Department determined
that the sunset review of the antidumping duty order on industrial
nitrocellulose from Korea is extraordinarily complicated. Therefore, on
October 12, 1999, the Department extended the time limit for completion
of the preliminary results of this review until not later than December
28, 1999, in accordance with section 751(c)(5)(B) of the
Act.4
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\4\ See Extension of Time Limit for Final Results of Five-Year
Reviews, 64 FR 55233 (October 12, 1999).
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Determination
In accordance with section 751(c)(1) of the Act, the Department
conducted this review to determine whether revocation of the
antidumping order would be likely to lead to continuation or recurrence
of dumping. Section 752(c) of the Act provides that, in making this
determination, the Department shall consider the weighted-average
dumping margins determined in the investigation and subsequent reviews
and the volume of imports of the subject merchandise for the period
before and the period after the issuance of the antidumping order, and
shall provide to the International Trade Commission (``the
Commission'') the magnitude of the margin of dumping likely to prevail
if the order is revoked.
The Department's determinations concerning continuation or
recurrence of dumping and the magnitude of the margins are discussed
below. In addition, Hercules' comments with respect to continuation or
recurrence of dumping and the magnitude of the margins are addressed
within the respective sections below.
Continuation or Recurrence of Dumping
Drawing on the guidance provided in the legislative history
accompanying the Uruguay Round Agreements Act (``URAA''), specifically
the Statement of Administrative Action (``the SAA''), H.R. Doc. No.
103-316, vol. 1 (1994), the House Report, H.R. Rep. No. 103-826, pt.1
(1994), and the Senate Report, S. Rep. No. 103-412 (1994), the
Department issued its Sunset Policy Bulletin providing guidance on
methodological and analytical issues, including the bases for
likelihood determinations. In its Sunset Policy Bulletin, the
Department indicated that determinations of likelihood will be made on
an order-wide basis (see section II.A.2). In addition, the Department
indicated that normally it will determine that revocation of an
antidumping order is likely to lead to continuation or recurrence of
dumping where (a) dumping continued at any level above de minimis after
the issuance of the order, (b) imports of the subject merchandise
ceased after the issuance of the order, or (c) dumping was eliminated
after the issuance of the order and import volumes for the subject
merchandise declined significantly (see section II.A.3).
In addition to considering the guidance on likelihood cited above,
section 751(c)(4)(B) of the Act provides that the Department shall
determine that revocation of an order is likely to lead to continuation
or recurrence of dumping where a respondent interested party waives its
participation in the sunset review. In the instant review, the
Department did not receive a response from any respondent interested
party. Pursuant to section 351.218(d)(2)(iii) of the Sunset
Regulations, this constitutes a waiver of participation.
In its substantive response, Hercules asserts that the likelihood
of continuation or recurrence of dumping is high if the order is
revoked. (See July 1, 1999 substantive response of Hercules at 3-6). To
support this argument, Hercules notes a drastic decline in import
volumes of the subject merchandise immediately after the issuance of
the order. According to Hercules, after the imposition of the
antidumping order, imports of the subject merchandise completely
stopped.5 Id. The cessation of imports in the years
immediately after the issuance of the order, Hercules further argues,
is
[[Page 57849]]
highly probative of the likelihood of future dumping. Id.
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\5\ The order was imposed on July 10, 1990. (See footnote 1,
supra.) In 1989 and 1990, imports of the subject merchandise were
147 and 58 metric tons, respectively; however, during the period
1991 through 1998, the import volumes were as follows: 1991--0;
1992--0; 1993--0; 1994--0; 1995--0; 1996--0; 1997--18; and 1998--0
metric tons. (See July 1, 1999 substantive response of the Hercules,
Attachment 2.)
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Hercules also indicates that, for the past five years, imports of
the subject merchandise have been mostly at zero or near
zero.6 Id. According to Hercules, the small amount of
imports of the subject merchandise in 1997 was the result of Korean
producers/exporters' attempt to attain a reduced cash deposit rate in a
pending administrative review.7 Id. To further illustrate
its contention, Hercules notes that after the weighted-average dumping
margin for the subject merchandise was reduced, Korean producers/
exporters still could not sustain the exports of the subject
merchandise.8 Id. In conclusion, Hercules argues that Korean
manufacturers/exporters of the subject merchandise could not sustain
their level of exports to the United States after the issuance of the
antidumping duty order; in other words, Korean manufacturers/exporters
have to dump in order to export the subject merchandise to the United
States.
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\6\ See footnote 5, supra. During 1994-1998, the average import
volume of the subject merchandise was only 3.6 metric tons, which is
about 3.51 percent of the average imports of 1989 and 1990, or 2.45
percent of 1989 imports alone.
\7\ See footnote 3, supra. In that review, the Department found
a 2.1 percent weighted-average dumping margin for one reviewed
company, Daesang Corporation (``Daesang'') while leaving all other
entries of nitrocellulose from Korea subject to the rate determined
in the original investigation: 66.30 percent.
\8\ See footnote 5, supra. The import level of the subject
merchandise in 1998 was zero.
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Consistent with section 752(c) of the Act, the Department considers
the import volumes of the subject merchandise before and after the
issuance of the order. The data supplied by Hercules and those of the
United States Census Bureau IM146s and the United States International
Trade Commission indicate that, since the imposition of the order, the
import volumes of the subject merchandise have declined
substantially.9 Moreover, for the period 1994-1998, the
United States International Trade Commission Data shows rather
insignificant import volumes for the subject merchandise.10
Therefore, the Department determines that the import volumes of the
subject merchandise decreased significantly after the issuance of the
order.
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\9\ See footnote 5, supra. The numbers supplied by Hercules
exactly correspond with those of the U.S. International Trade
Commission Data.
\10\ See footnote 6, supra.
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As indicated in section II.A.3 of the Sunset Policy Bulletin, the
SAA at 890, and House Report at 63-64, the Department also considers
whether dumping continued at any level above de minimis after the
issuance of the order. If companies continue dumping with the
discipline of an order in place, the Department may reasonably infer
that dumping would continue were the discipline removed. After
examining the published findings with respect to weighted-average
dumping margins in the original investigation and from the previous
administrative review,11 the Department determines that,
since the issuance of the order, weighted-average dumping margins for
the subject merchandise have continued at above the de minimis level.
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\11\ See footnote 7, supra.
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Given that dumping of the subject merchandise continued above the
de minimis level after the issuance of the order, that the import
volumes of the subject merchandise decreased substantially after the
issuance of the order, and that respondent interested parties have
waived their right to participate in this review, the Department agrees
with Hercules' contention that dumping is likely to continue if the
order is revoked.
Magnitude of the Margin
In the Sunset Policy Bulletin, the Department stated that it will
normally provide to the Commission the margin that was determined in
the final determination in the original investigation. Further, for
companies not specifically investigated or for companies that did not
begin shipping until after the order was issued, the Department
normally will provide a margin based on the ``all others'' rate from
the investigation. (See section II.B.1 of the Sunset Policy Bulletin.)
Exceptions to this policy include the use of a more recently calculated
margin, where appropriate, and consideration of duty absorption
determinations. (See sections II.B.2 and 3 of the Sunset Policy
Bulletin.)
The Department, in its final determination of sales at less-than-
fair-value, published a weighted-average dumping margin for Miwon and
all-others: 66.30 percent.12 We note that, to date, the
Department has not issued any duty absorption findings in this case.
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\12\ See Final Determination of Sales at Less Than Fair Value:
Industrial Nitrocellulose from the Republic of Korea, 55 FR 21054
(May 22, 1990).
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In its substantive response, Hercules urges the Department to
report to the Commission the dumping margins from the original
investigation as the margins likely to prevail if the order were
revoked. (See the July 1, 1999 Substantive Response of Hercules at 6.)
Although the Department found a substantially reduced 2.10 percent
dumping margin for a Korean producer in its administrative review,
Hercules contends that the reduced dumping margin coincided with
greatly declined import volumes of the subject
merchandise.13 Id. Moreover, Hercules notes that a year
after the administrative review, in 1998, imports of the subject
merchandise again returned to zero indicating that Korean producers/
exporters were unable to increase their exports of the subject
merchandise to the United States at the reduced antidumping margin. Id.
Therefore, Hercules concludes, the 2.1 percent margin achieved by a
Korean producer was clearly the result of a small test shipment and
does not reflect commercial reality. Id. In other words, the best and
only possible recommendation the Department can make, regarding the
margins that are likely to prevail, is to rely upon the rates from the
original investigation.
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\13\ See footnote 3, supra. In its only administrative review,
the Department found that Daesang Corporation, which was not subject
of the original investigation, was dumping at the rate of 2.10
percent during the period July 1, 1996 through June 30, 1997. At the
same time, the Department indicated that cash deposit rate for Miwon
and all-others was the original, less-than-fair-value rate of 66.30
percent.
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The Department agrees with Hercules' suggestion pertaining to the
margin that is likely to prevail if the order were revoked. Because the
margins from the original investigation reflect the behavior of Korean
producers/exporters without the discipline of an order in place, the
Department will provide to the Commission the margins found in the
original investigation. Absent argument and evidence to the contrary,
the Department sees no reason to change its usual practice of selecting
the rate from the original investigation. We will report to the
Commission the company-specific and all-others rate contained in the
Final Results of Review section of this notice.
Final Results of Review
As a result of this review, the Department finds that revocation of
the antidumping order would likely lead to continuation or recurrence
of dumping at the margins listed below:
------------------------------------------------------------------------
Margin
Manufacturer/exporter (percent)
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Miwon Corporation.......................................... 66.30
All Others (including Daesang)............................. 66.30
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This notice serves as the only reminder to parties subject to
administrative protective order (``APO'') of their responsibility
concerning the disposition of proprietary information disclosed under
APO in accordance
[[Page 57850]]
with 19 CFR 351.305 of the Department's regulations. Timely
notification of return/destruction of APO materials or conversion to
judicial protective order is hereby requested. Failure to comply with
the regulations and the terms of an APO is a sanctionable violation.
This five-year (``sunset'') review and notice are in accordance
with sections 751(c), 752, and 777(i)(1) of the Act.
Dated: October 21, 1999.
Richard W. Moreland,
Acting Assistant Secretary for Import Administration.
[FR Doc. 99-28064 Filed 10-26-99; 8:45 am]
BILLING CODE 3510-DS-P
