2012-24813. Certain Lined Paper Products From the People's Republic of China: Notice of Final Results and Partial Rescission of Antidumping Duty Administrative Review

AGENCY:

Import Administration, International Trade Administration, Department of Commerce.

SUMMARY:

On June 1, 2012, the Department of Commerce (the “Department”) published in the Federal Register its preliminary results of the fifth administrative review of certain lined paper products from the People's Republic of China (“PRC”).^[1] We invited parties to comment on the Preliminary Results, however, no party submitted a case brief to the Department. The current review covers two exporters: Leo's Quality Products Co., Ltd./Denmax Plastic Stationery Factory (“Leo/Denmax”) and Shanghai Lian Li Paper Products Co., Ltd. (“Lian Li”). For Leo/Denmax, we continue to apply adverse facts available (“AFA”); for Lian Li, we are rescinding the review.

DATES:

Effective Date: October 9, 2012.

FOR FURTHER INFORMATION CONTACT:

Cindy Robinson, AD/CVD Operations, Office 3, Import Administration, International Trade Administration, Department of Commerce, 14th Street and Constitution Avenue NW., Washington, DC 20230; telephone: [phone].

SUPPLEMENTARY INFORMATION:

Background

In the Preliminary Results, the Department preliminarily rescinded this review with respect to Lian Li based on evidence on the record indicating that Lian Li had no shipments of subject merchandise which entered the United States during the period of review (“POR”) of September 1, 2010, through August 31, 2011.^[2] As discussed in the Preliminary Results, on December 30, 2011, Lian Li submitted a letter, certifying that they did not export the subject merchandise to the United States during the POR; the Department confirmed this information with U.S. Customs and Border Protection (“CBP”). We invited interested parties to submit comments on our Preliminary Results, but we received no comments.

In addition, the Department preliminarily applied AFA with respect to Leo/Denmax because Leo/Denmax did not respond to the Department's questionnaire. As stated above, on June 1, 2012, the Department published its Preliminary Results. On June 5, 2012, the Department received a letter dated May 29, 2012, from Leo/Denmax stating that they made no sales of subject merchandise to the United States during the POR and requesting rescission of the review with respect to Leo/Denmax. However, because Leo/Denmax's letter claiming that it made no shipments was improperly and untimely submitted, the Department rejected and returned Leo/Denmax's letter on June 11, 2012.^[3] Therefore, for purposes of these final results, we continue to apply AFA with respect to Leo/Denmax. See the “Application of AFA with Respect to Leo/Denmax” section below for further details.

Period of Review

The POR is September 1, 2010, through August 31, 2011.

Scope of the Order

The scope of this order includes certain lined paper products, typically school supplies (for purposes of this scope definition, the actual use of or labeling these products as school supplies or non-school supplies is not a defining characteristic) composed of or including paper that incorporates straight horizontal and/or vertical lines on ten or more paper sheets (there shall be no minimum page requirement for looseleaf filler paper) including but not limited to such products as single- and multi-subject notebooks, composition books, wireless notebooks, looseleaf or glued filler paper, graph paper, and laboratory notebooks, and with the smaller dimension of the paper measuring 6 inches to 15 inches (inclusive) and the larger dimension of the paper measuring 8-3/4 inches to 15 inches (inclusive). Page dimensions are measured size (not advertised, stated, or “tear-out” size), and are measured as they appear in the product (i.e., stitched and folded pages in a notebook are measured by the size of the page as it appears in the notebook page, not the size of the unfolded paper). However, for measurement purposes, pages with tapered or rounded edges shall be measured at their longest and widest points. Subject lined paper products may be loose, packaged or bound using any binding method (other than case bound through the inclusion of binders board, a spine strip, and cover wrap). Subject merchandise may or may not contain any combination of a front cover, a rear cover, and/or backing of any composition, regardless of the inclusion of images or graphics on the cover, backing, or paper. Subject merchandise is within the scope of this order whether or not the lined paper and/or cover are hole punched, drilled, perforated, and/or reinforced. Subject merchandise may contain accessory or informational items including but not limited to pockets, tabs, dividers, closure devices, index cards, stencils, protractors, writing implements, reference materials such as mathematical tables, or printed items such as sticker sheets or miniature calendars, if such items are physically incorporated, included with, or attached to the product, cover and/or backing thereto.

Specifically excluded from the scope of this order are:

• Unlined copy machine paper;
• Writing pads with a backing (including but not limited to products commonly known as “tablets,” “note pads,” “legal pads,” and “quadrille pads”), provided that they do not have a front cover (whether permanent or removable). This exclusion does not apply to such writing pads if they consist of hole-punched or drilled filler paper;
• Three-ring or multiple-ring binders, or notebook organizers incorporating such a ring binder provided that they do not include subject paper;
• Index cards;
• Printed books and other books that are case bound through the inclusion of binders board, a spine strip, and cover wrap;
• Newspapers;
• Pictures and photographs;
• Desk and wall calendars and organizers (including but not limited to such products generally known as “office planners,” “time books,” and “appointment books”);
• Telephone logs;
• Address books;
• Columnar pads & tablets, with or without covers, primarily suited for the recording of written numerical business data;
• Lined business or office forms, including but not limited to: Pre-printed business forms, lined invoice pads and paper, mailing and address labels, manifests, and shipping log books;
• Lined continuous computer paper;
• Boxed or packaged writing stationary (including but not limited to products commonly known as “fine business paper,” “parchment paper”, and “letterhead”), whether or not containing a lined header or decorative lines;
• Stenographic pads (“steno pads”), Gregg ruled (“Gregg ruling” consists of a single- or double-margin vertical ruling line down the center of the page. For a six-inch by nine-inch stenographic pad, the ruling would be located approximately three inches from the left of the book.), measuring 6 inches by 9 inches.

Also excluded from the scope of this order are the following trademarked products:

• Fly^TM lined paper products: A notebook, notebook organizer, loose or glued note paper, with papers that are printed with infrared reflective inks and readable only by a Fly^TM pen-top computer. The product must bear the valid trademark Fly^TM (products found to be bearing an invalidly licensed or used trademark are not excluded from the scope).
• Zwipes^TM: A notebook or notebook organizer made with a blended polyolefin writing surface as the cover and pocket surfaces of the notebook, suitable for writing using a specially-developed permanent marker and erase system (known as a Zwipes^TM pen). This system allows the marker portion to mark the writing surface with a permanent ink. The eraser portion of the marker dispenses a solvent capable of solubilizing the permanent ink allowing the ink to be removed. The product must bear the valid trademark Zwipes^TM (products found to be bearing an invalidly licensed or used trademark are not excluded from the scope).
• FiveStar®Advance^TM: A notebook or notebook organizer bound by a continuous spiral, or helical, wire and with plastic front and rear covers made of a blended polyolefin plastic material joined by 300 denier polyester, coated on the backside with PVC (poly vinyl chloride) coating, and extending the entire length of the spiral or helical wire. The polyolefin plastic covers are of specific thickness; front cover is 0.019 inches (within normal manufacturing tolerances) and rear cover is 0.028 inches (within normal manufacturing tolerances). Integral with the stitching that attaches the polyester spine covering, is captured both ends of a 1″ wide elastic fabric band. This band is located 2-3/8″ from the top of the front plastic cover and provides pen or pencil storage. Both ends of the spiral wire are cut and then bent backwards to overlap with the previous coil but specifically outside the coil diameter but inside the polyester covering. During construction, the polyester covering is sewn to the front and rear covers face to face (outside to outside) so that when the book is closed, the stitching is concealed from the outside. Both free ends (the ends not sewn to the cover and back) are stitched with a turned edge construction. The flexible polyester material forms a covering over the spiral wire to protect it and provide a comfortable grip on the product. The product must bear the valid trademarks FiveStar®Advance^TM (products found to be bearing an invalidly licensed or used trademark are not excluded from the scope).
• FiveStar Flex^TM: A notebook, a notebook organizer, or binder with plastic polyolefin front and rear covers joined by 300 denier polyester spine cover extending the entire length of the spine and bound by a 3-ring plastic fixture. The polyolefin plastic covers are of a specific thickness; front cover is 0.019 inches (within normal manufacturing tolerances) and rear cover is 0.028 inches (within normal manufacturing tolerances). During construction, the polyester covering is sewn to the front cover face to face (outside to outside) so that when the book is closed, the stitching is concealed from the outside. During construction, the polyester cover is sewn to the back cover with the outside of the polyester spine cover to the inside back cover. Both free ends (the ends not sewn to the cover and back) are stitched with a turned edge construction. Each ring within the fixture is comprised of a flexible strap portion that snaps into a stationary post which forms a closed binding ring. The ring fixture is riveted with six metal rivets and sewn to the back plastic cover and is specifically positioned on the outside back cover. The product must bear the valid trademark FiveStar Flex^TM (products found to be bearing an invalidly licensed or used trademark are not excluded from the scope).

Merchandise subject to this order is typically imported under headings 4810.22.5044, 4811.90.9050, 4820.10.2010, 4820.10.2020, 4820.10.2030, 4820.10.2040, 4820.10.2060, and 4820.10.4000 of the Harmonized Tariff Schedule of the United States (“HTSUS”). The HTSUS headings are provided for convenience and customs purposes; however, the written description of the scope of this order is dispositive.

Since the issuance of the order, the Department has clarified the scope of the order in response to numerous scope inquiries. In addition, on September 23, 2011, the Department revoked, in part, the PRC AD order with respect to FiveStar® Advance^TM notebooks and notebook organizers without PVC coatings.^[4]

Analysis of Comments Received

We have received no comments on our Preliminary Results, with the exception of Leo/Denmax's May 29, 2012, letter which the Department rejected on June 11, 2012, as noted above.

Final Rescission of Review With Respect to Lian Li

Because there is no information on the record which indicates that Lian Li made shipments of subject merchandise which entered the United States during the POR, and because we did not receive any comments on our Preliminary Results, in accordance with 19 CFR 351.213(d)(3) and consistent with our practice, we are rescinding this review of the antidumping duty order on certain lined paper products from the PRC for the period of September 1, 2010, through August 31, 2011, with respect to Lian Li. The cash deposit rate for Lian Li will continue to be the rate established in the most recently completed segment of this proceeding.

Application of Adverse Facts Available (AFA) With Respect to Leo/Denmax

In this case, the Department issued a questionnaire to Leo/Denmax on November 8, 2011, by email. Receiving no acknowledgement of receipt of the emailed questionnaire from Leo/Denmax, the Department sent a hard copy of the questionnaire to Leo/Denmax through United Parcel Service (“UPS”) by registered mail on November 17, 2011.^[5] After the Department announced its Preliminary Results, Leo/Denmax submitted a letter stating that Leo/Denmax did not have any exports, sales or entries of subject merchandise to the United States during the POR, and requested that the Department rescind the administrative review with respect to Leo/Denmax. The deadline for submitting a letter certifying “no shipments” was December 31, 2011, but the Department did not receive Leo/Denmax's no-shipment letter until June 5, 2012 (dated May 29, 2011), 158 days after the filing deadline for a no shipment letter.^[6] Moreover, Leo/Denmax's letter was not filed electronically on the Department's filing system (IA ACCESS), as required and stated in the initial questionnaire issued to Leo/Denmax. Instead, Leo/Denmax filed its letter manually in regular mail without submitting the proper certifications. Therefore, on June 11, 2012, the Department rejected Leo's/Denmax's no-shipment submission dated May 29, 2012, because the letter was improperly and untimely submitted. In accordance with 19 CFR 351.302(d)(iii), the Department also withdrew all known copies of Leo/Denmax's May 29, 2012, letter from the record and returned them to Leo/Denmax. The Department informed Leo/Denmax that this information shall not be considered by the Department in making its final results of review.^[7]

Section 776(a) of the Tariff Act of 1930, as amended (“the Act”) provides that the Department shall apply “facts otherwise available” if (1) necessary information is not on the record, or (2) an interested party or any other person (A) withholds information that has been requested, (B) fails to provide information within the deadlines established, or in the form and manner requested by the Department, subject to subsections (c)(1) and (e) of section 782 of the Act, (C) significantly impedes a proceeding, or (D) provides information that cannot be verified as provided by section 782(i) of the Act.

Where the Department determines that a response to a request for information does not comply with the request, section 782(d) of the Act provides that the Department will so inform the party submitting the response and will, to the extent practicable, provide that party the opportunity to remedy or explain the deficiency. If the party fails to remedy the deficiency within the applicable time limits and subject to section 782(e) of the Act, the Department may disregard all or part of the original and subsequent responses, as appropriate. Section 782(e) of the Act provides that the Department “shall not decline to consider information that is submitted by an interested party and is necessary to the determination but does not meet all applicable requirements established by the administering authority” if the information is timely, can be verified, is not so incomplete that it cannot be used, and if the interested party acted to the best of its ability in providing the information. Where all of these conditions are met, the statute requires the Department to use the information supplied if it can do so without undue difficulties.

Section 776(b) of the Act further provides that the Department may use an adverse inference in applying the facts otherwise available when a party has failed to cooperate by not acting to the best of its ability to comply with a request for information. Such an adverse inference may include reliance on information derived from the petition, the final determination, a previous administrative review, or other information placed on the record.^[8] Furthermore, “affirmative evidence of bad faith on the part of a respondent is not required before the Department may make an adverse inference.” ^[9]

Because Leo/Denmax did not provide the requested information timely and properly, they significantly impeded the proceeding and we find that application of facts available is appropriate under sections 776(a)(2)(A), (B), and (C) of the Act. We further find that application of AFA is appropriate under section 776(b) because Leo/Denmax failed to cooperate to the best of its ability in responding to the Department's requests for information.

Separate Rates

In proceedings involving nonmarket economy (“NME”) countries, there is a rebuttable presumption that all companies within that country are subject to government control and thus should be assessed a single antidumping duty rate. It is the Department's policy to assign all exporters of subject merchandise in an NME country this single rate unless an exporter demonstrates that it is sufficiently independent so as to be entitled to a separate rate. Exporters can demonstrate this independence through the absence of both de jure and de facto governmental control over export activities.^[10] It is the Department's practice to require a party to submit evidence that it operates independently of the State-controlled entity in each segment of a proceeding in which it requests separate rate status. The process requires exporters to submit a separate-rate status application.^[11] As discussed in the Preliminary Results, Leo/Denmax did not respond to the Department's questionnaire regarding separate rate eligibility, or submit a separate rate certification. Furthermore, Leo/Denmax has not demonstrated that it operates free from government control. Therefore, the Department continues to find that Leo/Denmax is part of the PRC-wide entity.

The PRC-Wide Entity

Because we determined that Leo/Denmax is part of the PRC-wide entity, the PRC-wide entity is under review. Pursuant to section 776(a) of the Act, we further find that because the PRC entity (including Leo/Denmax) failed to respond to the Department's questionnaires, withheld or failed to provide information in a timely manner or in the form or manner requested by the Department, submitted information that cannot be verified, or otherwise impeded the proceeding, it is appropriate to apply a dumping margin for the PRC-wide entity using the facts otherwise available on the record. Moreover, by failing to respond to the Department's requests for information, we find that the PRC-wide entity has failed to cooperate by not acting to the best of its ability to comply with the Department's requests for information in this proceeding, within the meaning of section 776(b) of the Act. Therefore, an adverse inference is warranted in selecting from the facts otherwise available.^[12]

Selection of Adverse Facts Available Rate

In deciding which facts to use as AFA, section 776(b) of the Act and 19 CFR 351.308(c)(1) provide that the Department may rely on information derived from (1) the petition, (2) a final determination in the investigation, (3) any previous review or determination, or (4) any other information placed on the record. In selecting a rate for AFA, the Department selects a rate that is sufficiently adverse “as to effectuate the purpose of the facts available rule to induce respondents to provide the Department with complete and accurate information in a timely manner.”^[13]

Generally, the Department finds that selecting the highest rate from any segment of the proceeding as AFA is appropriate.^[14] The Court of International Trade (“CIT”) and the Court of Appeals for the Federal Circuit (“CAFC”) have affirmed the Department's prior decisions to select the highest margin from any prior segment of the proceeding as the AFA rate on numerous occasions.^[15]

As AFA, we have assigned to the PRC-wide entity a rate of 258.21 percent, from the investigation of certain lined paper products from the PRC, which is the highest rate on the record of all segments of this proceeding.^[16] As explained below, this rate has been corroborated.

Corroboration of Secondary Information

Section 776(c) of the Act provides that, when the Department relies on secondary information rather than on information obtained in the course of an investigation or review, it shall, to the extent practicable, corroborate that information from independent sources that are reasonably at its disposal. Secondary information is defined as information derived from the petition that gave rise to the investigation or review, the final determination concerning the subject merchandise, or any previous review under section 751 of the Act concerning the subject merchandise.^[17] Corroborate means that the Department will satisfy itself that the secondary information to be used has probative value.^[18] To corroborate secondary information, the Department will, to the extent practicable, examine the reliability and relevance of the information to be used.^[19]

The AFA rate selected in this instance is from the original investigation. This rate was calculated based on information contained in the petition, which was corroborated for the final determination.^[20] This rate was also applied in the 2007-2008 period of review of lined paper products from the PRC and the CIT found this PRC-wide rate to be corroborated.^[21] No additional information has been presented in the current review which calls into question the reliability of the information.^[22] Therefore, the Department finds that the information continues to be reliable and has probative value. In addition, the AFA rate we are applying is the rate currently in effect for the PRC-wide entity.^[23]

Final Results of Review

We determine that the following margin exists for the period September 1, 2010, through August 31, 2011:

Exporter	Weighted- average margin (percent)
PRC-wide Entity (including Leo/Denmax)	258.21

Assessment Rates

Pursuant to section 751(a)(2)(A) of the Act and 19 CFR 351.212(b)(1), the Department will determine, and CBP shall assess, antidumping duties on all appropriate entries covered by this review. The Department intends to issue assessment instructions to CBP 15 days after the publication date of the final results of this review. We will instruct CBP to liquidate all appropriate entries at the PRC-wide rate of 258.21 percent.

Cash Deposit Requirements

The following cash deposit requirements will be effective upon publication of the notice of final results of the administrative review for all shipments of certain lined paper products from the PRC entered, or withdrawn from warehouse, for consumption on or after the date of publication, as provided by section 751(a)(2)(C) of the Act: (1) For previously reviewed or investigated companies not listed above that have separate rates, the cash-deposit rate will continue to be the company-specific rate published for the most recent period; (2) for all other PRC exporters of subject merchandise, which have not been found to be entitled to a separate rate, the cash-deposit rate will be PRC-wide rate of 258.21 percent; and (3) for all non-PRC exporters of subject merchandise, the cash-deposit rate will be the rate applicable to the PRC exporter that supplied that non-PRC exporter. These deposit requirements, when imposed, shall remain in effect until further notice.

Notification to Importers

This notice serves as a final reminder to importers of their responsibility under 19 CFR 351.402(f)(2) to file a certificate regarding the reimbursement of antidumping duties prior to liquidation of the relevant entries during this review period. Failure to comply with this requirement could result in the Secretary's presumption that reimbursement of antidumping duties occurred and the subsequent assessment of double antidumping duties.

Notification Regarding APOs

This notice also serves as a reminder to parties subject to administrative protective orders (“APO”) of their responsibility concerning the return or destruction of proprietary information disclosed under APO in accordance with 19 CFR 351.305, which continues to govern business proprietary information in this segment of the proceeding. Timely written notification of the return/destruction of APO materials or conversion to judicial protective order is hereby requested. Failure to comply with the regulations and terms of an APO is a violation which is subject to sanction.

This notice is issued and published in accordance with sections 751(a)(1) and 777(i)(1) of the Act, as amended, and 19 CFR 351.213(d)(4).

Dated: October 1, 2012.

Paul Piquado,

Assistant Secretary for Import Administration.

Footnotes

1.  See Certain Lined Paper Products from the People's Republic of China: Notice of Preliminary Results of the Antidumping Duty Administrative Review and Preliminary Rescission, In Part, 77 FR 32498 (June 1, 2012) (“Preliminary Results”).

2.  Id.

3.  See the Department's June 11, 2012, letter to Tilly Shiang, General Manager, Leo's Quality Products Co., Ltd. from James Terpstra, Program Manager, titled “Certain Lined Paper Products from the People's Republic of China—Return of Improperly and Untimely Submission of Leos' May 29, 2012 No Shipment Letter, (Rejection Letter).”

4.  See Certain Lined Paper Products From People's Republic of China: Final Results of Antidumping Duty Changed Circumstances Review and Revocation, in Part, 76 FR 60803 (September 30, 2011).

5.  See “Proof of Delivery of Antidumping Questionnaire to Leo's Quality Products Co., Ltd,” memorandum to file from Joy Zhang, analyst, through James Terpstra, Program Manager, Office 3, AD/CVD Operations, dated January 4, 2012.

6.  The Department's Rejection Letter inadvertently stated that the deadline for filing a notice of no sale letter is October 31, 2011.

7.  Id.

8.  See, e.g., Notice of Final Results of Antidumping Duty Administrative Review: Stainless Steel Bar from India, 70 FR 54023, 54025-26 (September 13, 2005); Statement of Administrative Action, reprinted in H.R. Doc. No. 103-216, at 870 (1994) (“SAA”).

9.  See Antidumping Duties; Countervailing Duties; Final Rule, 62 FR 27296, 27340 (May 19, 1997); see also Nippon Steel Corp. v. United States, 337 F.3d 1373, 1382 (Fed. Cir. 2003) (“Nippon”).

10.  See Notice of Final Determination of Sales at Less Than Fair Value: Sparklers from the People's Republic of China, 56 FR 20588 (May 6, 1991), as further developed in Notice of Final Determination of Sales at Less Than Fair Value: Silicon Carbide from the People's Republic of China, 59 FR 22585 (May 2, 1994).

11.  See Tapered Roller Bearings and Parts Thereof, Finished or Unfinished, from the People's Republic of China: Final Results of 2005-2006 Administrative Review and Partial Rescission of Review, 72 FR 56724 (October 4, 2007), Peer Bearing Co. Changshan v. United States, 587 F.Supp. 2d 1319, 1324-25 (CIT 2008) (affirming the Department's determination in that review).

12.  See Nippon, 337 F.3d at 1382-83.

13.  See Circular Welded Austenitic Stainless Pressure Pipe from the People's Republic of China: Final Determination of Sales at Less Than Fair Value, 74 FR 4913 (January 28, 2009).

14.  See, e.g., Certain Cased Pencils from the People's Republic of China; Notice of Preliminary Results of Antidumping Duty Administrative Review and Intent to Rescind in Part, 70 FR 76755, 76761 (December 28, 2005).

15.  See Rhone Poulenc, Inc. v. United States, 899 F.2d 1185, 1190 (Fed. Cir. 1990) (“Rhone Poulenc”); NSK Ltd. v. United States, 346 F. Supp. 2d 1312, 1335 (CIT 2004) (upholding the application of an AFA rate which was the highest available dumping margin from a different respondent in an investigation).

16.  See Notice of Amended Final Determination of Sales at Less Than Fair Value: Certain Lined Paper Products from the People's Republic of China; Notice of Antidumping Duty Orders: Certain Lined Paper Products from India, Indonesia and the People's Republic of China; and Notice of Countervailing Duty Orders: Certain Lined Paper Products from India and Indonesia, 71 FR 56949 (September 28, 2006).

17.  See SAA at 870.

18.  Id.

19.  See Preliminary Results of Antidumping Duty Administrative Reviews and Partial Termination of Administrative Reviews: Tapered Roller Bearings and Parts Thereof, Finished and Unfinished from Japan, and Tapered Roller Bearings Four Inches or Less in Outside Diameter, and Components Thereof, from Japan, 61 FR 57391, 57392 (November 6, 1996) (unchanged in the final determination), Final Results of Antidumping Duty Administrative Reviews and Termination in Part: Tapered Roller Bearings and Parts Thereof, Finished and Unfinished from Japan, and Tapered Roller Bearings Four Inches or Less in Outside Diameter, and Components Thereof, from Japan, 62 FR 11825 (March 13, 1997).

20.  See Notice of Amended Final Determination of Sales at Less Than Fair Value: Certain Lined Paper Products from the People's Republic of China; Notice of Antidumping Duty Orders: Certain Lined Paper Products from India, Indonesia and the People's Republic of China; and Notice of Countervailing Duty Orders: Certain Lined Paper Products from India and Indonesia, 71 FR 56949 (September 28, 2006).

21.  See Watanabe Group v. United States, Court No. 09-520, Slip Op. 2010-139 (CIT Dec. 22, 2010), affirming Final Results in Certain Lined Paper Products from the People's Republic of China: Notice of Final Results of the Antidumping Duty Administrative Review, 74 FR 63387 (December 3, 2009).

22.  See Certain Lined Paper Products from the People's Republic of China: Notice of Final Results of the Antidumping Duty Administrative Review, 76 FR 23288 (April 26, 2011).

23.  Id.