[Federal Register Volume 62, Number 240 (Monday, December 15, 1997)]
[Notices]
[Pages 65674-65679]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-32632]
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DEPARTMENT OF COMMERCE
International Trade Administration
[A-570-825]
Sebacic Acid From the People's Republic of China; Final Results
of Antidumping Duty Administrative Review
AGENCY: Import Administration, International Trade Administration,
Department of Commerce.
ACTION: Notice of final results of antidumping duty administrative
review of sebacic acid from the People's Republic of China.
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SUMMARY: On August 8, 1997, the Department of Commerce (the Department)
published the preliminary results of its administrative review of the
antidumping duty order on sebacic acid from the People's Republic of
China (PRC) (62 FR 42755). This review covers shipments of this
merchandise to the United States during the period of July 1, 1995,
through June 30, 1996. We gave interested parties an opportunity to
comment on our preliminary results. Based upon our analysis of the
comments received we have changed the results from those presented in
the preliminary results of the review. In accordance with the decision
in Sigma Corp. v. the United States, 117 F.3d 1401 (Fed. Cir. 1997), we
revised our calculations of source-to-factory surrogate freight for
those material inputs that are based in CIF import values in the
surrogate country. We have added to CIF surrogate values from India, a
surrogate freight cost using the shorter of the reported distances from
either the closest PRC port to the factory, or from the domestic
supplier to the factory. See Notice of Final Determination of Sales at
Less Than Fair Value: Collated Roofing Nails from the People's Republic
of China, 62 FR 51415, 51410 (October 1, 1997); Notice of Final
Determination of Sales at Less Than Fair Value: Certain Cut-to-Length
Carbon Steel Plate from the People's Republic of China 62 FR 61964,
61977 (November 20, 1997).
EFFECTIVE DATE: December 15, 1997.
FOR FURTHER INFORMATION CONTACT: Doreen Chen or Stephen Jacques, Import
Administration, International Trade Administration, U.S. Department of
Commerce, 14th and Constitution Avenue, N.W., Washington, D.C. 20230;
telephone: (202) 482-0413 or (202) 482-1391, respectively.
Applicable Statute and Regulations: Unless otherwise indicated, all
citations to the statute are references to the provisions effective
January 1, 1995, the effective date of the amendments made to the
Tariff Act of 1930 (the Act) by the Uruguay Rounds Agreements Act
(URAA). In addition, unless otherwise indicated, all citations to the
Department's regulations are in reference to the regulations, codified
at 19 CFR 353 (April 1, 1996).
Supplementary Information:
Background
The Department published in the Federal Register an antidumping
duty order on sebacic acid from the PRC on July 14, 1995 (59 FR 35909).
On August 8, 1997, the Department of Commerce (the Department)
published the preliminary results of its administrative review of the
antidumping duty order on sebacic acid from the PRC (62 FR 42755 August
8, 1997) for the period July 1, 1995 through June 30, 1996. We received
written comments from Tianjin Chemicals Import and Export Corporation
(Tianjin), Guangdong Chemicals Import and Export Corporation
(Guangdong), and Sinochem International Chemicals
[[Page 65675]]
Company, Ltd. (SICC) (collectively, respondents); and from the
petitioner, Union Camp Corporation. On November 24, 1997, the
Department informed parties that certain information in respondents'
September 15, 1997 rebuttal brief and petitioner's September 8, 1997
case brief contained untimely new information that should be stricken
from the record of this review. The Department is conducting this
administrative review in accordance with section 751 of the Act.
Scope of Review
The products covered by this order are all grades of sebacic acid,
a dicarboxylic acid with the formula (CH2)8(COOH)2, which
include but are not limited to CP Grade (500ppm maximum ash, 25 maximum
APHA color), Purified Grade (1000ppm maximum ash, 50 maximum APHA
color), and Nylon Grade (500ppm maximum ash, 70 maximum ICV color). The
principal difference between the grades is the quantity of ash and
color. Sebacic acid contains a minimum of 85 percent dibasic acids of
which the predominant species is the C10 dibasic acid.
Sebacic acid is sold generally as a free-flowing powder/flake.
Sebacic acid has numerous industrial uses, including the production
of nylon 6/10 (a polymer used for paintbrush and toothbrush bristles
and paper machine felts), plasticizers, esters, automotive coolants,
polyamides, polyester castings and films, inks and adhesives,
lubricants, and polyurethane castings and coatings.
Sebacic acid is currently classifiable under subheading
2917.13.00.00 of the Harmonized Tariff Schedule of the United States
(HTSUS). Although the HTSUS subheading is provided for convenience and
customs purposes, our written description of the scope of this
proceeding remains dispositive.
This review covers the period July 1, 1995, through June 30, 1996,
and four exporters of Chinese sebacic acid.
Analysis of Comments Received
Comment 1: surrogate country: Petitioner asserts that India should
not be used as the surrogate country for the PRC because they claim
there is no sebacic acid production in India. Petitioner contends that
it would be inconsistent with the statute to use India as a surrogate
because: (1) India is not a producer of sebacic acid; and (2) oxalic
acid is not commercially or chemically comparable to sebacic acid. See
19 U.S.C. Sec. 1677b(c)(1). Petitioner argues that while it is true
that both oxalic and sebacic acid are dicarboxylic acids, oxalic acid
has two carbon atoms (C2H2O4) and
sebacic acid has ten carbon atoms
(C10H18O4), giving the two acids
completely different properties and uses. Petitioner contends that the
production process inputs for the two acids are very different.
Additionally, petitioner argues that the commercial value of sebacic
acid is nearly 5 times greater than the U.S. value for oxalic acid.
Petitioner suggests that the Department should value the factors of
production based on either U.S. or Japanese values, the only two market
economies where sebacic acid is produced using the caustic fusion
process. Petitioner contends that there is no known sebacic acid
production in India. Petitioner maintains that they did not find any
Indian chemicals companies which produced sebacic acid during the
period of review and that the absence of the price for sebacic acid in
the Indian Chemical Weekly publication suggests further evidence of the
lack of sebacic acid production in India. Because sebacic acid is not
produced in India, petitioner argues that pursuant to 19 CFR 353.52(c),
the United States is the appropriate surrogate country for this
administrative review.
Respondents maintain that there is now evidence on the record of
this review that sebacic acid is produced in India. Respondents note
that on January 6, 1997, they submitted a letter dated September 25,
1996 from an Indian chemical company, Siris Limited, stating that
sebacic acid is now produced in India. Consequently, respondents urge
the Department to reject petitioner's argument for using Japan or the
United States as the surrogate country and instead, continue to use
India as the surrogate country.
Respondents argue that 19 U.S.C. Sec. 1677b(c)(4) provides that
``[t]he administering authority, in valuing factors of production under
paragraph (1), shall utilize, to the extent possible, the prices or
cost of factors of production in one or more market economy countries
that are--(A) at a level of economic development comparable to that of
the nonmarket economy country, and (B) significant producers of
comparable merchandise.'' (Respondent Rebuttal Brief at p. 2) (emphasis
in original). Respondents argue that the words ``to the extent
possible'' give the Commerce Department the option to choose, as a
surrogate country, a country that does not produce the same merchandise
or even comparable merchandise, if no country meets both criteria set
forth in the statute. Respondents argue that petitioner's asserted
definition of ``comparable'' merchandise requires that products have
identical characteristics, including identical chemical formula and
uses. Respondents also note that under petitioner's definition of
``comparable'' merchandise, there is no country that would meet both
aspects of the statute. Respondents maintain that such a narrow
definition defeats the Congressional purpose in giving the Department
the discretion to determine what constitutes a comparable product.
Respondents also note that the statute suggests that it was Congress'
intent to give to the Department substantial discretion in determining
what are comparable products and choosing surrogate countries.
In addition, respondents contend that the values of oxalic and
sebacic acid are different should have no bearing on the choice of a
surrogate country since in this review, the Department is not using the
value of oxalic acid to value sebacic acid. Respondents also maintain
that there is substantial evidence on the record of this investigation
that India is a substantial producer of castor oil, the primary input
for sebacic acid. Furthermore, respondents point out that the
Department verified that Tianjin Zhonghe, the Chinese sebacic acid
producer, used imported castor oil from India to produce sebacic acid.
Respondents disagree with petitioner that the absence of a price
for sebacic acid from Indian Chemical Weekly and Chemical Business
suggests that the chemical is not produced in India. Respondents note
that the Department has in the past been forced to rely on Indian
import statistics because neither the Chemical Weekly nor the Chemical
Business report a certain price for a chemical.
Department's Position: In valuing factors of production, the
Department used surrogate values from India. In accordance with 19
U.S.C. Sec. 1677b(c)(4), the Department chose India as its surrogate
because it was most comparable to the PRC in terms of overall economic
development based on per capita gross national product (GNP), the
national distribution of labor, and growth rate in per capita GNP, and
because it was a significant producer of comparable merchandise (oxalic
acid).
The statute and the regulations instruct the Department to value
factors of production in an appropriate surrogate country. The
Department rarely departs from use of a surrogate value from a country
comparable to the NME in terms of overall economic development. See
Final Determination of Sales at Less Than Fair Value: Beryllium Metal
and High Beryllium Alloys from the Republic of Kazakstan, 62 FR 2648
(January 17, 1997).
[[Page 65676]]
Surrogate values from countries at a similar level of development are
considered to be the most appropriate and comparable for valuation of
the factors of production used in the similarly situated nonmarket
economy country. While the Department may use values from the United
States or other countries not at a comparable level of development for
individual factors, its practice is to do so only if it cannot find
those values in a comparable economy that produce comparable
merchandise. Use of the United States, Japan or another country not on
the list of recommended surrogate countries proposed by the
Department's Office of Policy is less desirable specifically because
surrogate values from countries not at a level of economic development
comparable to that of the nonmarket economy are not considered to be as
representative of the nonmarket economy country's costs and prices. See
Memorandum from Director, Office of Policy to Office Director, AD/CVD
Group II/OIX, Sebacic Acid from the People's Republic of China:
Nonmarket Economy Status and Surrogate Country Selection, June 24,
1997.
The fact that sebacic acid is produced in the United States or
Japan does not make either country an appropriate surrogate. Neither
the United States nor Japan are at a level of economic development
comparable to the that of the PRC. Moreover, the Department has
concluded that using values from India is appropriate because India is
at a comparable level of development and, based on U.S. import
statistics for the POR, is a significant producer of comparable
merchandise--oxalic acid. See Analysis Memorandum for the Preliminary
Results of the 1995/1996 Review. (Preliminary Analysis Memorandum).
We disagree with petitioner that oxalic acid is not comparable to
sebacic acid. The statute does not define ``comparable merchandise''
and the relevant legislative history evidences Congress' intent to
allow the agency to select from a wide category of merchandise in
identifying comparable merchandise. See H.R. Conf. Rep. No. 100-576
(1988), reprinted in 1988 U.S.C.C.A.N. 1547. Thus, to impose a
requirement that merchandise must be produced by the same process and
share the same end uses to be considered comparable would be contrary
to the intent of the statute. Therefore, in the final determination for
the 1994-1995 review, we determined that oxalic acid and sebacic acid
were comparable products. See Sebacic Acid from the People's Republic
of China: Final Results of Antidumping Duty Administrative Review, 62
FR 10530, 10533 (March 7, 1997). In that review, the Department found
that although the chemicals may have different production processes,
oxalic acid and sebacic acid are comparable products since both are
dicarboxylic acids and have similar end uses as they are both used in
the rubber industry. Id.
Finally, we determine that the documents submitted by interested
parties on January 3, 1997 and January 6, 1997 do not conclusively
demonstrate that sebacic acid was produced in India during the period
of review (POR). Therefore, we have not relied on these documents as a
basis for our decision to use India as the surrogate country for this
review.
Comment 2: Petitioner argues that the Department should value
capryl alcohol consistent with the CIT's decision in Union Camp Corp.
v. United States, 941 F. Supp. 108 (Ct. Int'l Trade, 1996).
Specifically, petitioner asserts that the CIT ordered the Department to
value capryl alcohol (octanol-2) based on an appropriate cost of crude
octanol-2 rather than the Indian selling price for refined octanol-1
listed in Chemical Weekly. Id. at 119.
Petitioner questions the letter from the editor of Chemical Weekly
submitted by respondents and relied upon by the Department for the
preliminary results, which states that ``the octanol price referred by
you corresponds to the more common 2-octanol (2 ethylhexanol).'' See
Preliminary Results of Antidumping Duty Administrative Review; Sebacic
Acid from the PRC 62 FR 42,758 (August 8, 1997); (Preliminary Analysis
Memorandum at 6); Letter from Williams Mullen Christian & Dobbins, Jan.
3, 1997, at Attachment 4. Petitioner contends that because respondents
failed to provide the original letter to the editor of Chemical Weekly,
there is no evidence to indicate whether the octanol price referred to
in the original letter to the editor corresponds to the octanol price
in the Chemical Weekly. In addition, petitioner argues that there is no
evidence on the record to indicate that the Chemical Weekly editor is
sufficiently familiar with the chemical composition of the octanol
product published in the Chemical Weekly to declare that it is octanol-
2 (2-ethylhexanol). Petitioner argues because octanol-1 is not
comparable to octanol-2, the Department should not use the Chemical
Weekly price for octanol-1 to value crude octanol-2.
Petitioner contends that Union Camp and respondents Tianjin Zhong
He and Hengshui Dongfeng Chemical Factory all treat capryl alcohol as a
by-product. Therefore, petitioner argues that Department should treat
capryl alcohol as a by-product and not a co-product. Petitioner claims
that because the Department used the high Indian value of octanol-1 to
value octanol-2, the Department incorrectly determined octanol-2 to be
a co-product rather than a by-product of the sebacic acid process.
Petitioner argues that because octanol-2 is only produced during
the sebacic acid production process and because there is no sebacic
acid production in India, octanol-2 is not sold in India. Petitioner
points out that there is a large value difference between the U.S.
octanol-1 price and the U.S. capryl alcohol price. Moreover, petitioner
rejects respondents' surrogate price for capryl alcohol, $0.68/lb.,
from the Chemical Marketing Reporter, because it is the same as Union
Camp's offering price for refined capryl alcohol. According to
petitioner, crude capryl alcohol, the subsidiary product of the sebacic
acid process, must be further processed to achieve a 98 percent pure
refined product. The Chemical Marketing Reporter reported the market
value of octanol-1 at $0.925/lb during the POR. Petitioner argues that
the U.S. value of octanol-1 during the POR was 36 percent higher than
the U.S. value of refined capryl alcohol and that the value difference
between octanol-1 and crude capryl alcohol is even larger. Therefore,
petitioner concludes that because octanol-1 is not comparable to
octanol-2 either chemically or commercially, the Department should not
use octanol-1 as a surrogate value for octanol-2.
Petitioner offers its own by-product credit value for crude capryl
alcohol, $0.15/lb., as the best available surrogate price for the
subsidiary product. However, petitioner states that if the Department
chooses to use the $0.68/lb price, it should make adjustments for input
costs in converting crude capryl alcohol to refined capryl alcohol.
Petitioner supplies such a calculation where the resulting value is
$0.1544/lb.
Respondents argue that the Department should continue to use a
surrogate value for octanol from India. Respondents maintain that the
evidence on the record supports that the octanol price in Chemical
Weekly is equivalent to the Indian price for octanol-2, not the
octanol-1 as argued by the petitioner. Respondents submitted a letter
from the Indian Chemical Weekly, which states that the ``octanol''
price in the Indian Chemical Weekly ``corresponds to the more common
octanol-2 (ethylhexanol-2).'' See Submission, January 6, 1997.
Respondents argue that according to Hawley's Condensed Chemical
Dictionary, ethylhexanol-2 is another
[[Page 65677]]
form of octanol. Id. Respondents also submitted additional information
from the U.S. chemical company, Ivanhoe Industries, which stated that
``octanol'' is a generic term which can include octanol-1, octanol-2,
octanol-3, ethyl hexanol-2 and other products. In addition, respondents
argue that all octyl alcohols can be used interchangeably to produce
plastercizers for vinyl resins and as esters for lube oils and
therefore are comparable products.
Respondents disagree with petitioner's claims that the octanol
price in the Indian Chemical Weekly significantly overstates the price
of capryl alcohol. Respondents claim they provided prices from the U.S.
Chemical Marketing Reporter in their January 6, 1997 PAPI submission,
which they argue, demonstrates that ethyl hexanol-2 is less expensive
than octanol-2. Moreover, respondents maintain that the Indian Chemical
Weekly price of octanol of $1520 per metric ton is within a reasonable
range of the $1450 price quote respondents obtained for capryl alcohol
from SIRIS, a chemical company in India. Respondents argue that Union
Camp's internal price for octanol-2 at 15 cents a pound is a less
reasonable price to value Chinese capryl alcohol in comparison to the
Indian prices for octanol quoted by SIRIS and reported by Chemical
Weekly.
In addition, respondents maintain that Tianjin Zhonghe cannot break
out the additional costs for refining capryl alcohol, which respondents
claim, merely amount to additional electricity to distill the product.
Therefore, respondents argue for valuing capryl alcohol, the Department
should not use Union Camp's unverified internal costs for production of
capryl alcohol, since Union Camp uses an entirely different production
process from the Chinese production process.
If, in the alternative, the Department decides to use a U.S.
surrogate value for octanol-2, respondents urge that we use a surrogate
value from the U.S. Chemical Marketing Reporter for the price of capryl
alcohol in the United States because it is publicly available
information rather than Union Camp's internal price.
Department's Position: The petitioner's argument that to be
consistent with the CIT's decision Union Camp Corp. v. United States,
941 F. Supp. 108, 112 (Ct. Int'l Trade, 1996), the Department should
value capryl alcohol based on the cost of octanol-2 is unpersuasive.
First, the Department is not bound by the decision in Union Camp
because the CIT's decision was rendered moot by the issuance of the
results of the first administrative review. See Sebacic Acid From the
People's Republic of China: Final Results of Antidumping Duty
Administrative Review, 62 FR 10530 (March 7, 1997).
Second, use of the value of octanol-1 as a surrogate value is
consistent with the statute and Department practice. In valuing factors
of production, the Department's practice is to rely, to the extent
possible, on publicly available information. The Department prefers to
use publicly available information because: (1) It alleviates
difficulties in obtaining, and concerns about the quality of, cable
data from embassies and consulates (previously often used as sources
for surrogate values); (2) it allows interested parties an opportunity
to actively submit and comment on surrogate value data; (3) the
establishment of a clear surrogate values hierarchy, with a preference
for surrogate values from a single country based on publicly available
information, increases the certainty and predictability of the outcome
of the Department's factor valuations; (4) the methodological framework
helps to focus comments made by petitioner and respondent in the case
and rebuttal briefs and reduces miscellaneous submissions throughout
the course of proceedings regarding the appropriateness of various
surrogate values; and (5) it alleviates the administrative burden on
U.S. embassies and consulates caused by requests for large amounts of
data. See Final Determination of Sales at Less Than Fair Value: Certain
Carbon Steel Butt-Weld Pipe Fittings from the People's Republic of
China, 57 FR 21058, 21062 (May 18, 1992). In determining which
surrogate value to use for valuing each factor of production,
therefore, the Department selects, where possible, publicly available
information which is: (1) An average non-export value; (2)
representative of a range of prices within the period of review, if
submitted by an interested party, or most contemporaneous with the POR;
(3) product-specific; and (4) tax-exclusive.
In this review, the Department was unable to locate an Indian value
for octanol-2. In addition, the Department specifically asked
interested parties to submit any publicly available, published values
for octanol-2. Neither the petitioner, Union Camp, nor the respondents
were able to locate a specific Indian value for octanol-2. As a result,
the Department used an Indian price for octanol-1 as a surrogate value
for octanol-2 as the best available information. The Department
concluded that, for purposes of factor valuation, octanol-1 was
comparable to octanol-2. We find that octanol-1 and capryl alcohol
(octanol-2) share very similar molecular formula though they are not
identical products. Since product-specific price information is not
available from our preferred surrogate countries, we have relied on the
price of the most physically similar product for which we could obtain
value information.
We disagree with petitioner's argument that we should not use the
octanol price from the Indian Chemical Weekly because octanol-1 and
octanol-2 are not commercially comparable. In support of their
argument, petitioner relies on the publication Chemical Marketing
Reporter which, petitioner claims, indicates that there is a
significant difference in value between capryl alcohol and octanol-1.
However, prices from Chemical Marketing Reporter are prices from the
United States, which is not the surrogate country in this case. On the
other hand, respondents have provided sufficient evidence from India,
which is the surrogate country in this case, to support the conclusion
that octanol-1 and octanol-2 are commercially comparable. Respondents
provided evidence demonstrating that the octanol price reported in the
Indian Chemical Weekly is comparable to the octanol-2 price obtained
from SIRIS, a chemical company in India. Since India is the surrogate
country in this case and the price for octanol reported in Chemical
Weekly is commercially comparable to the Indian price for octanol-2
from another source, we used the octanol price for Chemical Weekly in
our surrogate value analysis.
Moreover, Union Camp's statements that octanol-1 is derived from a
process entirely unrelated to the sebacic acid process and that
octanol-1 is a high-priced petrochemical are not dispositive on the
issue of the comparability of octanol-1 and octanol-2 for purposes of
factor valuation. In a nonmarket economy case, the Department may need
to value anywhere from a few to hundreds of factors of production; in
this case we needed to value approximately 25. Although we strive to
locate exact surrogate matches in our preferred surrogate country, we
often are unable to do so. In those instances, the Department's
practice is to use the most comparable surrogate match that meets our
publicly available information criteria in an appropriate surrogate
country.
There is no basis in the statute or legislative history to suggest
that the Department is required to research or
[[Page 65678]]
consider the production process or use for each factor so as to locate
a surrogate match with an identical or even similar production process
or use. In valuing factors of production, the Department is attempting
to assign a market-economy value, i.e., a price or a cost, to some non-
market economy factor, e.g., 50 kilograms of chemical ``x'', 12 nuts
and bolts, 3 plastic bags, 7 hours of labor. The Department does not
delve into intricacies of the production and use of every potential
surrogate factors of production precisely because production and use
are not necessarily relevant to valuation of these factors. The
Department is foremost concerned about assigning an appropriate
surrogate value to a specific factor of production. As a result, the
Department will consider rejecting a potential surrogate where it has
evidence that a possible surrogate value does not reasonably reflect
the ``value'' of the factor. For example, if the Department had
evidence that a surrogate price was significantly higher than other
potential surrogate prices for a particular factor, the Department
might find that it was not reasonable to use that particular price as a
surrogate value.
Similarly, the Department is not required to consider
interchangeability in determining whether to use a particular surrogate
to value a factor of production and we disagree with the Court's
suggestion to the contrary in Union Camp. If interchangeability were a
prerequisite, the Department would have extreme difficulty in valuing
factors of production. The Department would be required to locate
precise matches between surrogates and factors--an impracticable if not
virtually impossible task given the amount of data the Department would
have to collect and analyze for each factor. The very nature of
chemicals, in particular, is such that a small difference in grade or a
change in molecular structure would preclude ever finding two different
chemicals comparable for purposes of factor valuation. In this case,
for example, the Department recognizes that octanol-1 and octanol-2 are
two different products, and, hence not interchangeable. Nevertheless,
octanol-1 and octanol-2 are sufficiently similar, physically and
commercially, for octanol-1 to serve as a reasonable surrogate for
octanol-2.
The statute and the regulations instruct the Department to value
factors of production, to the extent practicable, in an appropriate
surrogate country. Using an internal price from the United States for
an input, as suggested by petitioner, would be inappropriate. First,
the evidence on the record of this review establishes that respondents'
octanol-1 value, which is from a publicly available publication, is a
reasonable substitute for octanol-2 in our calculations, given the
limited public and published data from India available to the
Department. In contrast, the petitioner's cost is neither a value from
one of the selected surrogate countries nor is it a public or published
figure. As explained above, the Department's practice is to use
publically available figures because, among other reasons, it increases
the certainty and predictability of the outcome of the Department's
factor valuations in NME cases, and it affords all interested parties
an opportunity to submit and comment on surrogate value data. Thus,
based on the facts of this case, use of an unpublished, internal cost
from a country not on the list of preferred surrogates is contrary to
the Department's established practice. See Magnesium Corp. of America
v. United States, 938 F. Supp. 885 (Ct. Intl' Trade, 1996) (``It is
Commerce's standard practice to disregard petitioner's costs because
they are not `an appropriate benchmark by which to test the accuracy of
surrogate country values.' '') Furthermore, because preference is for
values from the selected surrogate country, we did not use the U.S.
price for octanol-2 from Chemical Marketing Reporter submitted by
respondents. Therefore, we have used the 76 rupees/kg value from the
Indian Chemical Weekly as a surrogate value for capryl alcohol as the
best information available to the Department.
We also disagree with petitioner's argument that capryl alcohol
should be treated as a by-product rather than a co-product. Consistent
with the methodology employed in the final determination in the less-
than-fair-value investigation, we have determined that capryl alcohol
is a co-product. Therefore, we have allocated the factor inputs, based
on the relative quantity of output of this product and sebacic acid.
Additionally, we have used the production times necessary to complete
each production stage of sebacic acid as a basis for allocating the
amount of labor, energy usage, and factory overhead among the products.
This treatment of co-products is consistent with generally accepted
accounting principles. (See Cost Accounting: A Managerial Emphasis
(1991) at pages 528-533). See Final Results Analysis Memorandum, at
Attachment I and II.
Comment 3: Petitioner argues that the Department was incorrect in
making tax adjustments to prices from the Economic Times used to value
inputs castor oil, castor seed and castor seed cake. Petitioner argues
that there is no evidence on the record to support the assumption that
price information from the Economic Times is tax inclusive. Petitioner
notes that there is evidence on the record that at least one price for
castor seed oil is tax exclusive, that is the price for Madras which
indicates ``tax extra.'' Analysis Memorandum, at Attachment XII.
Petitioner notes that it is the Department's policy to rely first on
tax-exclusive prices in the surrogate market. Preliminary Determination
of Sales at Less than Fair Value: Certain Cut-to-Length Carbon Steel
Plate from the PRC, 62 FR 31,972, 31,977 (June 11, 1997).
Respondents had no comment on this issue.
Department's Position: We agree with petitioner. We have not
adjusted prices derived from the Economic Times for taxes because there
is not substantial evidence on the record to indicate that the prices
from the Economic Times were tax inclusive.
Comment 4: Petitioner maintains that the Department should correct
certain ministerial errors discussed in the Department's August 13,
1997 Memorandum to the File from Lyn A. Baranowski, namely: (1) Include
a freight expense for SICC's transportation of coal; (2) include a
freight expense for Tianjin's transportation of castor seed; (3) adjust
sodium chloride, coal, plastic bags, middle bags, woven bags, and
castor seed in Tianjin's freight calculation worksheet; and (4) include
a freight expense for Tianjin's purchased castor oil and adjust the
expense for coal.
Respondents had no comment on these errors.
Department's Position: We agree with petitioner. We revised
calculations accordingly to correct the aforementioned ministerial
errors raised by the Department in the August 13, 1997 Memorandum.
Comment 5: Respondents contend that the Department used the
incorrect weights for plastic bags in the preliminary results.
Respondents maintains that the Department should use the weights stated
in verification report. In addition, respondents argue that the
Department should not use a surrogate value for plastic bags which are
abberrational.
Petitioner had no comment on this issue.
Department's Position: We agree with respondents. We have used the
correct weights for the bags as reported at verification. In addition,
we have continued to use Import Statistics from India to value bags as
the price information from Import Statistics is a
[[Page 65679]]
publicly available publication and has been used to value plastic bags
in past determinations. See Notice of the Preliminary Determination of
the Sales of Less than Fair Value: Bicycles from the PRC 60 FR 56567,
56573 (November 9, 1995).
Final Results of Review
For Jiangsu, which failed to respond to the questionnaire, we have
not granted a separate rate and the country-wide rate will apply to all
of its sales. For Guangdong, which reported that it had no sales during
the POR, its company-specific rate from the previous administrative
review remains unchanged.
As a result of our review of the comments received, we have changed
the results from those presented in our preliminary results of the
review. Therefore, we determine that the following margins exists as a
result of our review:
------------------------------------------------------------------------
Margin
Manufacturer/exporter Time period (percent)
------------------------------------------------------------------------
Tianjin Chemicals I/E Corp................ 7/01/95-6/30/96 0.00
Sinochem International Chemicals Corp..... 7/01/95-6/30/96 1.78
Guangdong Chemicals I/E Corp.............. 7/01/95-6/30/96 13.54
Country-Wide Rate......................... 7/01/95-6/30/96 243.40
------------------------------------------------------------------------
The Department shall determine, and the Customs Service shall
assess, antidumping duties on all appropriate entries. Individual
differences between USP and NV may vary from the percentages stated
above. The Department will issue appraisement instructions directly to
the Customs Service.
Furthermore, the following cash deposit requirements will be
effective upon publication of the final results of this administrative
review for all shipments of the subject merchandise entered, or
withdrawn from warehouse, for consumption on or after the publication
date, as provided for by section 751(a)(1) of the Act: (1) For the
reviewed companies named above which have separate rates (SICC and
Tianjin), the cash deposit rates will be the rates for those firms
indicated above; (2) for companies previously found to be entitled to a
separate rate and for which no review was requested, the cash deposit
rates will be the rate established in the most recent review of that
company; (3) for all other PRC exporters of subject merchandise from
the PRC, the cash deposit rates will be the PRC country-wide rate
indicated above; and (4) the cash deposit rate for non-PRC exporters of
subject merchandise from the PRC will be the rate applicable to the PRC
supplier of that exporter. These deposit rates, when imposed, shall
remain in effect until publication of the final results of the next
administrative review.
Notification of Interested Parties
This notice also serves as a preliminary reminder to importers of
their responsibility under 19 CFR 353.26 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.
This administrative review and notice are in accordance with
section 751(a)(1) of the Act (19 U.S.C. 1675(a)(1)) and section 353.22
of the Department's regulations.
Dated: December 8, 1997.
Richard W. Moreland,
Acting Assistant Secretary for Import Administration.
[FR Doc. 97-32632 Filed 12-12-97; 8:45 am]
BILLING CODE 3510-DS-P
