E9-7232. Granular Polytetrafluoroethylene Resin From Italy: Final Results of Antidumping Duty Administrative Review

AGENCY:

Import Administration, International Trade Administration, Department of Commerce.

SUMMARY:

On September 22, 2008, the Department of Commerce published the preliminary results of the administrative review of the antidumping duty order on granular polytetrafluoroethylene resin from Italy, covering the period August 1, 2006, through July 31, 2007. We invited interested parties to comment on these preliminary results. Based on our analysis of the comments received and the results of verification, we have made changes to the margin calculation. The final weighted-average dumping margin for the reviewed firm is listed below in the section entitled “Final Results of Review.”

EFFECTIVE DATE:

March 31, 2009.

FOR FURTHER INFORMATION CONTACT:

Yasmin Nair or Nancy Decker, at [phone] or [phone], respectively; AD/CVD Operations, Office 1, Import Administration, International Trade Administration, U.S. Department of Commerce, 14^th Street & Constitution Avenue, NW, Washington, DC 20230.

SUPPLEMENTARY INFORMATION:

Background

On September 22, 2008, the Department of Commerce (“Department”) published the preliminary results of its administrative review of the antidumping duty order on granular polytetrafluoroethylene (“PTFE”) resin from Italy. See Amended Notice of Preliminary Results of Antidumping Duty Administrative Review: Granular Polytetrafluoroethylene Resin From Italy, 73 FR 54557 (September 22, 2008) (“Preliminary Results”).

From October 13 through October 17, 2008, we verified Solvay Solexis S.p.A.'s sales response. We issued a report for this verification on December 11, 2008. See Memorandum from Shane Subler and Alicia Winston, International Trade Compliance Analysts, to Susan H. Kuhbach, Director, Office 1, “Verification of the Sales Response of Solvay Solexis S.p.A. in the Antidumping Duty Administrative Review of Granular Polytetrafluoroethylene Resin from Italy,” (December 11, 2008) (“Home Market Verification Report”). From November 13 through November 19, 2008, we verified Solvay Solexis S.p.A.'s cost response. We issued a report for this verification on January 6, 2009. See Memorandum from Ernest Z. Gziryan, Senior Accountant, to Neal M. Halper, Director, Office of Accounting, “Verification of the Cost of Production and Constructed Value Data Submitted by Solvay Solexis S.p.A. in the Antidumping Duty Administrative Review of Granular Polytetrafluoroethylene (“PTFE”) Resin from Italy,” (January 6, 2009) (“Cost Verification Report”). On October 27 and 28, 2008, we verified Solvay Solexis, Incorporated's constructed export price (“CEP”) sales response. See Memorandum from Shane Subler and Alicia Winston, International Trade Compliance Analysts, to Susan H. Kuhbach, Director, Office 1, “Verification of the Sales Response of Solvay Solexis, Inc. in the Antidumping Duty Administrative Review of Granular Polytetrafluoroethylene Resin from Italy,” (January 9, 2009) (“CEP Verification Report”). In this notice, we refer to the three reports collectively as the “Verification Reports.”

We invited parties to comment on the Preliminary Results. On January 26, 2009, we received case briefs from E.I. DuPont de Nemours & Company (“the petitioner”) and Solvay Solexis, Inc. and Solvay Solexis S.p.A. (collectively, “Solvay”). On January 29, 2009, we received rebuttal briefs from the petitioner and Solvay. On January 26, 2009, Solvay requested a public hearing; the hearing was held at the Department of Commerce on February 2, 2009. A record of the February 2, 2009, hearing is available in the Central Records Unit (“CRU”), Room 1117 of the main Department building.

On January 9, 2009, we extended the time limit for the final results of this administrative review, pursuant to section 751(a)(3)(A) of the Tariff Act of 1930, as amended (“the Act”). See Granular Polytetrafluoroethylene Resin From Italy: Extension of Time Limit for the Final Results of the Antidumping Duty Administrative Review, 74 FR 885 (January 9, 2009).

Scope of the Order

The product covered by the order is granular PTFE resin, filled or unfilled. The order also covers PTFE wet raw polymer exported from Italy to the United States. See Granular Polytetrafluoroethylene Resin From Italy; Final Affirmative Determination of Circumvention of Antidumping Duty Order, 58 FR 26100 (April 30, 1993). The order excludes PTFE dispersions in water and fine powders. During the period covered by this review, such merchandise was classified under item number 3904.61.00 of the Harmonized Tariff Schedule of the United States (“HTSUS”). We are providing this HTSUS number for convenience and U.S. Customs and Border Protection (“CBP”) purposes only. The written description of the scope remains dispositive.

Cost of Production

Consistent with the Preliminary Results, we disregarded home-market sales by Solvay that failed the cost-of-production test.

Analysis of Comments Received

All issues raised in the case and rebuttal briefs by parties to this administrative review are addressed in the “Issues and Decision Memorandum” (“Decision Memorandum”) from John M. Andersen, Acting Deputy Assistant Secretary for Import Administration, to Ronald K. Lorentzen, Acting Assistant Secretary for Import Administration, dated March 23, 2009, which is hereby adopted by this notice. Attached to this notice, as an appendix, is a list of the issues which parties have raised and to which we have responded in the Decision Memorandum. Parties can find a complete discussion of all issues raised in this review and the corresponding recommendations in this memorandum, which is on file in the CRU, Room 1117 of the main Department building. In addition, a complete version of the Decision Memorandum can be accessed directly on the Import Administration website at http://ia.ita.doc.gov/​frn/​index.html. The paper copy and the electronic version of the Decision Memorandum are identical in content.

Changes Since the Preliminary Results

First, we revised the calculations from the Preliminary Results to account for minor corrections that Solvay submitted during the home market and CEP sales verifications. We revised the following fields in Solvay's home market sales database: packing and indirect selling expenses. We revised the following fields in Solvay's U.S. market sales database: U.S. inland freight from the warehouse to the customer, indirect selling expenses incurred in the United States, U.S. warehousing, U.S. brokerage, and packing. For details on the minor corrections, see page 2 and Exhibit 1 of the Home Market Verification Report; see also page 2 and Exhibits 1a-1d of the CEP Verification Report.

Second, we made additional changes to the Preliminary Results calculations to account for other findings from the sales verifications. First, we removed two sales to Canada from Solvay's U.S. sales database. See page 2 of the CEP Verification Report. Second, we found that Solvay used interest rates on loans from affiliated companies to calculate imputed credit and inventory carrying expenses for home market sales and U.S. market sales. See page 2 of the Home Market Verification Report; see also page 2 of the CEP Verification Report. Instead, we used interest rates published by the Bank of Italy for loans to non-financial corporations as an interest rate for the home market rather than Solvay's rate from affiliated companies. For the U.S. market, we used short-term interest rates published by the Federal Reserve for commercial and industrial loans as a surrogate interest rate. For both markets, we used a single weighted-average of the monthly interest rates that correspond to the period of review (“POR”).

Third, based on our analysis of comments from interested parties, we made the following changes to the cost of production calculation. First, we used Solvay's fiscal year 2007 financial statements to calculate general and administrative expenses (“G&A”) and financial expenses. Second, we calculated the short-term portion of Solvay's total interest income based on the ratio of current assets to the total interest income-producing assets of the parent company, Solvay S.A. We have addressed these two issues in the public decision memorandum that accompanies this notice. Finally, we made additional revisions to the calculation of G&A expenses and the total cost of manufacturing. Comments from parties on these issues contain business proprietary information, so we have addressed the comments in the Memorandum to the File from Ernest Gziryan to Neal M. Halper, “Cost of Production and Constructed Value Calculation Adjustments for the Final Results Solvay-Solexis S.p.A.,” (March 23, 2009).

We have explained the incorporation of all of the changes into the calculation programs in the Memorandum to the File from Yasmin Nair, “Final Results Calculation Memorandum for Solvay Solexis, Inc. and Solvay Solexis S.p.A. for the Nineteenth Administrative Review of Granular Polytetrafluoroethylene Resin From Italy,” (March 23, 2009).

Final Results of Review

As a result of our review, we determine that the following percentage weighted-average margin exists for the period August 1, 2006, through July 31, 2007:

Producer	Weighted-Average Margin (Percentage)
Solvay Solexis, Inc. and Solvay Solexis S.p.A. (collectively, “Solvay”)	79.47

Assessment Rates

The Department shall determine, and CBP shall assess, antidumping duties on all appropriate entries. Pursuant to 19 CFR 351.212(b)(1), the Department calculates an assessment rate for each importer of the subject merchandise covered by the review. To determine whether the duty assessment rates covering the period were de minimis, in accordance with the requirement set forth in 19 CFR 351.106(c)(2), we calculated importer (or customer)-specific ad valorem rates by aggregating the dumping margins calculated for all U.S. sales to that importer or customer and dividing this amount by the total value of the sales to that importer (or customer). Where an importer (or customer)-specific ad valorem rate was greater than de minimis, and the respondent has reported reliable entered values, we applied the assessment rate to the entered value of the importer's/customer's entries during the review period. Where an importer (or customer)-specific ad valorem rate was greater than de minimis and we did not have reliable entered values, we calculated a per-unit assessment rate by aggregating the dumping duties due for all U.S. sales to each importer (or customer) and dividing this amount by the total quantity sold to that importer (or customer). The Department intends to issue appropriate assessment instructions directly to CBP 15 days after publication of the final results of this review.

The Department clarified its “automatic assessment” regulation on May 6, 2003. See Antidumping and Countervailing Duty Proceedings: Assessment of Antidumping Duties, 68 FR 23954 (May 6, 2003). This clarification will apply to entries of subject merchandise during the period of review produced by the respondent for which it did not know its merchandise was destined for the United States. In such instances, we will instruct CBP to liquidate unreviewed entries at the all-others rate if there is no rate for the intermediate company(ies) involved in the transaction. For a full discussion of this clarification, see id.

Cash Deposit Requirements

The following deposit rates will be effective upon publication of the final results of this administrative review for all shipments of PTFE from Italy entered, or withdrawn from warehouse, for consumption on or after the publication date, as provided by section 751(a)(1) of the Act: (1) the cash deposit rate listed above for Solvay will be the rate established in the final results of this review, except if a rate is less than 0.5 percent, and therefore de minimis, the cash deposit rate will be zero; (2) for previously reviewed or investigated companies not listed above, the cash deposit rate will continue to be the company-specific rate published for the most recent period; (3) if the exporter is not a firm covered in this review, a prior review, or the less-than-fair-value (“LTFV”) investigation, but the manufacturer is, the cash deposit rate will be the rate established for the most recent period for the manufacturer of the merchandise; and (4) if neither the exporter nor the manufacturer is a firm covered in this or any previous review conducted by the Department, the cash deposit rate will be 46.46 percent, the “all others” rate established in the LTFV investigation. See Final Determination of Sales at Less Than Fair Value: Granular Polytetrafluoroethylene Resin From Italy, 53 FR 26096 (July 11, 1988). These cash deposit requirements, when imposed, shall remain in effect until further notice.

Notification to Importers

This notice also 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 in the subsequent assessment of double antidumping duties.

Notification to Interested Parties

This notice is also the reminder to parties subject to administrative protective order (“APO”) of their responsibility concerning the return or destruction of proprietary information disclosed under APO in accordance with 19 CFR 351.305(a)(3). 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 the terms of an APO is a sanctionable violation.

We are issuing and publishing these results and notice in accordance with sections 751(a)(1) and 777(i)(1) of the Act.

Dated: March 23, 2009.

Ronald K. Lorentzen,

Acting Assistant Secretary for Import Administration.

Appendix I

List of Comments in the Decision Memorandum

Comment 1: Differences Between Statutory Financial Statements and Financial Statements Prepared According to International Financial Reporting Standards

Comment 2: Financial Statements for G&A and Financial Expenses

Comment 3: Goodwill Amortization

Comment 4: Research and Development Expenses and Certain G&A Expenses

Comment 5: Major Inputs

Comment 6: Adjustments to the Cost of Manufacturing

Comment 7: Financial Expenses

Comment 8: Solvay's Use of Polymist® in Producing In-Scope Products

Comment 9: Non-U.S. Sales

Comment 10: Treatment of Negative Dumping Margins (Zeroing)