[Federal Register Volume 64, Number 146 (Friday, July 30, 1999)]
[Notices]
[Pages 41375-41380]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-19609]
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DEPARTMENT OF COMMERCE
International Trade Administration
[A-570-852]
Preliminary Determination of Sales at Less Than Fair Value and
Postponement of Final Determination: Creatine Monohydrate From the
People's Republic of China
AGENCY: Import Administration, International Trade Administration,
Department of Commerce.
EFFECTIVE DATE: July 30, 1999.
FOR FURTHER INFORMATION CONTACT: Blanche Ziv, Rosa Jeong, Annika O'Hara
or Marian Wells, Import Administration, International Trade
Administration, U.S. Department of Commerce, 14th Street and
Constitution Avenue, NW, Washington, DC 20230; telephone: (202) 482-
4207, (202) 482-3853, (202) 482-3798, and (202) 482-6309, respectively.
The Applicable Statute
Unless otherwise indicated, all citations to the Tariff Act of
1930, as amended (``the Act''), are references to the provisions
effective January 1, 1995, the effective date of the amendments made to
the Act by the Uruguay Round Agreements Act (``URAA''). In addition,
unless otherwise indicated, all citations to the Department of Commerce
(``Department'') regulations are to the regulations at 19 CFR Part 351
(April 1, 1998).
Preliminary Determination
We preliminarily determine that creatine monohydrate (``creatine'')
from the People's Republic of China (``PRC'') is being, or is likely to
be, sold in the United States at less than fair value (``LTFV''), as
provided in section 733 of the Act. The estimated margins of sales at
LTFV are shown in the ``Suspension of Liquidation'' section of this
notice.
Case History
Since the initiation of this investigation on March 10, 1999 (64 FR
11835), the following events have occurred:
On March 29, 1999, the United States International Trade Commission
(``ITC'') notified the Department of its affirmative preliminary injury
determination in this case.
On March 30, 1999, the Department requested comments on the scope
of this investigation from the petitioner, the respondents, the PRC's
Embassy in Washington, D.C., and the PRC Ministry of Foreign Trade and
Economic Cooperation (``MOFTEC''). On April 2, April 5, and April 19,
1999, we received comments on the scope from the petitioner and the
respondents. Based on the parties' comments, the Department has revised
the description of the scope of this investigation. Specifically, the
Department removed from the scope language the Chemical Abstracts
Service (``CAS'') registry number for anhydrous creatine, which is
chemically distinguishable from creatine monohydrate, the product
produced and sold by the petitioner. As described in the June 25, 1999
memorandum from the Team to Deputy Assistant Secretary Richard W.
Moreland (``Comments on Scope'') which is on file in Import
Administration's Central Records Unit, Room B-099, U.S. Department of
Commerce, 14th Street and Constitution Avenue, N.W., Washington, D.C.
20230, this change clarifies that the relief requested by petitioner is
only with
[[Page 41376]]
respect to creatine monohydrate. The revised scope appears in the
``Scope of Investigation'' section, below.
On April 7, 1999, the Department issued an antidumping
questionnaire to MOFTEC with instructions to forward the questionnaire
to all producers/exporters of the subject merchandise and that these
companies must respond by the due dates.
On April 28, 1999, the Department asked the China Chamber of
Commerce of Medicines & Health Products Importers & Exporters (``the
Chamber'') to identify any producers/exporters of the subject
merchandise in addition to the producers/exporters who had contacted
the Department and the producers/exporters identified by the
petitioner. We received a response from the Chamber on May 11, 1999.
On April 29, 1999, the Department invited interested parties to
provide publicly available information for valuing the factors of
production and for surrogate country selection. We received responses
on June 7 and June 16, 1999, and additional comments on June 14 and
June 22, 1999.
On May 10, and June 1, 1999, the Department received questionnaire
responses from (1) Tianjin Tiancheng Pharmaceutical Co., Ltd.
(``Tiancheng''); (2) Suzhou Sanjian Fine Chemical Co., Ltd.
(``Sanjian''); (3) Blue Science International Trading (Shanghai) Co.,
Ltd. and Technical Sourcing International (``Blue Science''); (4)
Nantong Medicines and Health Products Import and Export Co., Ltd. d/b/a
Nantong Foreign Trade Corporation Medicine and Health Products
Department (``Nantong''); (5) Shanghai Freemen International Trading
Co., Ltd. and Shanghai Greenmen International Trading Co., Ltd.
(``Freemen''); and (6) Jiangsu Shuang Qiang Chemical Co. and Wuxian
Agricultural Chemical Factory (``SQ''). Tiancheng and Sanjian both
produce and export the subject merchandise to the United States,
whereas Blue Science, Nantong, and Freemen are exporters and SQ is
solely a producer. We issued supplemental questionnaires on June 15,
June 16, June 21, and June 22, 1999, to which we received responses on
June 22, June 28, and July 6, 1999.
On May 20, 1999, Shanghai Desano International Trading Co., Ltd.
(``Desano'') requested that it be considered a respondent in this
investigation. On May 26, 1999, we sent an antidumping questionnaire to
Desano to which we received a response on June 30, 1999. Desano is
solely an exporter of the subject merchandise.
On April 8, 1999, and May 12, 1999, pursuant to the allegation of
critical circumstances contained in the petition, the Department
requested information regarding shipments of creatine from all
respondents participating in this investigation. We received the
requested information on May 13 and May 14, 1999. The critical
circumstances analysis for the preliminary determination is discussed
below under ``Critical Circumstances.''
Postponement of Final Determination and Extension of Provisional
Measures
Pursuant to section 735(a)(2) of the Act, on July 19 and July 21,
1999, several respondents requested that, in the event of an
affirmative preliminary determination in this investigation, the
Department postpone its final determination after the date of the
publication of an affirmative preliminary determination in the Federal
Register. In accordance with 19 CFR 351.210(b), because (1) our
preliminary determination is affirmative, (2) the requesting exporters
account for a significant proportion of exports of the subject
merchandise, and (3) no compelling reasons for denial exist, we are
granting the respondents' request and are postponing the final
determination until no later than 135 days after the publication of
this notice in the Federal Register. Suspension of liquidation will be
extended accordingly.
Scope of Investigation
For purposes of this investigation, the product covered is creatine
monohydrate, which is commonly referred to as ``creatine.'' The
chemical name for creatine monohydrate is N-(aminoiminomethyl)-N-
methylgycine monohydrate. The Chemical Abstracts Service registry
number for this product is 6020-87-7. Creatine monohydrate in its pure
form is a white, tasteless, odorless powder, that is a naturally
occurring metabolite found in muscle tissue. Creatine monohydrate is
provided for in subheading 2925.20.90 of the Harmonized Tariff Schedule
of the United States (``HTSUS''). Although the HTSUS subheading and CAS
registry number are provided for convenience and customs purposes, the
written description of the merchandise under investigation is
dispositive.
Period of Investigation
The period of this investigation (``POI'') comprises each
exporter's two most recent fiscal quarters prior to the filing of the
petition, i.e., July 1 through December 31, 1998.
Nonmarket Economy Country and Market Oriented Industry Status
The Department has treated the PRC as a nonmarket economy (``NME'')
country in all past antidumping investigations (see, e.g., Final
Determination of Sales at Less Than Fair Value: Certain Preserved
Mushrooms from the People's Republic of China, 63 FR 72255 (December
31, 1998) (``Mushrooms'')). A designation as an NME remains in effect
until it is revoked by the Department (see section 771(18)(C) of the
Act).
The respondents in this investigation have not requested a
revocation of the PRC's NME status. We have, therefore, preliminarily
determined to continue to treat the PRC as an NME.
Separate Rates
All the respondents, except SQ (which is not an exporter), have
requested a separate company-specific rate. Blue Science has stated
that it is a trading company which is wholly-owned by persons in Hong
Kong. Therefore, in accordance with our past practice, we preliminarily
determine that this exporter qualifies for a separate rate and that no
separate rates analysis is required for Blue Science (see, e.g., Final
Determination of Sales at Less Than Fair Value: Bicycles from the
People's Republic of China, 61 FR 19026 (April 30, 1996) (``Bicycles
from the PRC'')). The other respondents which have requested a separate
rate have stated that they are privately owned companies with no
element of government ownership or control.
The Department's separate rate test is not concerned, in general,
with macroeconomic/border-type controls, e.g., export licenses, quotas,
and minimum export prices, particularly if these controls are imposed
to prevent dumping. The test focuses, rather, on controls over the
investment, pricing, and output decision-making process at the
individual firm level. See Certain Cut-to-Length Carbon Steel Plate
from Ukraine: Final Determination of Sales at Less than Fair Value, 62
FR 61754, 61757 (November 19, 1997); Tapered Roller Bearings and Parts
Thereof, Finished and Unfinished, from the People's Republic of China:
Final Results of Antidumping Duty Administrative Review, 62 FR 61276,
61279 (November 17, 1997); and Honey from the People's Republic of
China: Preliminary Determination of Sales at Less than Fair Value, 60
FR 14725, 14726 (March 20, 1995) (``Honey'').
To establish whether a firm is sufficiently independent from
government control to be entitled to a
[[Page 41377]]
separate rate, the Department analyzes each exporting entity under a
test arising out of the Final Determination of Sales at Less Than Fair
Value: Sparklers from the People's Republic of China, 56 FR 20588 (May
6, 1991) and Mushrooms. Under the separate rates criteria, the
Department assigns separate rates in NME cases only if the respondents
can demonstrate the absence of both de jure and de facto governmental
control over export activities.
1. Absence of De Jure Control
The respondents have placed on the record a number of documents to
demonstrate absence of de jure government control, including the
``Foreign Trade Law of the People's Republic of China'' (``Foreign
Trade Law'') and the ``Company Law of the People's Republic of China''
(``Company Law'').
In prior cases, the Department has analyzed the Foreign Trade Law
and found that it establishes an absence of de jure control. (See,
e.g., Final Determination of Sales at Less Than Fair Value: Certain
Partial-Extension Steel Drawer Slides with Rollers from the People's
Republic of China, 60 FR 54472 (October 24, 1995); see also Mushrooms.)
We have no new information in this proceeding which would cause us to
reconsider this determination. For the purposes of this investigation
and in prior cases, the Department has also analyzed the Company Law
and found that this law establishes mechanisms for private control of
companies which indicate an absence of de jure control. See Notice of
Preliminary Results of New Shipper Review: Freshwater Crawfish Tail
Meat from the People's Republic of China, 64 FR 8543, 8544 (February
22, 1999).
According to the respondents, creatine exports are not affected by
quota allocations or export license requirements. The producers/
exporters claim to have the autonomy to set the price at whatever level
they wish through independent price negotiations with their foreign
customers without government interference.
Accordingly, we preliminarily determine that, within the creatine
industry, there is an absence of de jure government control over export
pricing and marketing decisions of firms.
2. Absence of De Facto Control
As stated in previous cases, there is some evidence that certain
enactments of the PRC central government have not been implemented
uniformly among different sectors and/or jurisdictions in the PRC. (See
Mushrooms.) Therefore, the Department has determined that an analysis
of de facto control is critical in determining whether respondents are,
in fact, subject to a degree of governmental control which would
preclude the Department from assigning separate rates.
The Department typically considers four factors in evaluating
whether each respondent is subject to de facto governmental control of
its export functions: (1) whether the export prices are set by, or
subject to, the approval of a governmental authority; (2) whether the
respondent has authority to negotiate and sign contracts and other
agreements; (3) whether the respondent has autonomy from the government
in making decisions regarding the selection of its management; and (4)
whether the respondent retains the proceeds of its export sales and
makes independent decisions regarding disposition of profits or
financing of losses (see Mushrooms).
Tiancheng, Sanjian, Nantong, Freemen, and Desano have each asserted
the following: (1) they establish their own export prices; (2) they
negotiate contracts without guidance from any governmental entities or
organizations; (3) they make their own personnel decisions; and (4)
they retain the proceeds of their export sales and use profits
according to their business needs without any restrictions.
Additionally, these five respondents have stated that they do not
coordinate or consult with other exporters regarding their pricing.
This information supports a preliminary finding that there is an
absence of de facto governmental control of the export functions of
these companies. Consequently, we preliminarily determine that all
responding exporters have met the criteria for the application of
separate rates.
Use of Facts Available
PRC-Wide Rate
Information on the record of this investigation indicates that
there may be producers/exporters of the subject merchandise in the PRC
in addition to the companies participating in this investigation. Also,
U.S. import statistics indicate that the total quantity of U.S. imports
of creatine from the PRC is greater than the total quantity of creatine
exported to the U.S. as reported by all PRC creatine exporters that
submitted responses in this investigation. Given this discrepancy, it
appears that not all PRC exporters of creatine responded to our
questionnaire. Accordingly, we are applying a single antidumping
deposit rate--the PRC-wide rate--to all exporters in the PRC, other
than those specifically identified below under ``Suspension of
Liquidation,'' based on our presumption that the export activities of
the companies that failed to respond to the Department's questionnaire
are controlled by the PRC government (see, e.g., Bicycles from the
PRC).
As explained below, this PRC-wide antidumping rate is based on
adverse facts available. Section 776(a)(2) of the Act provides that
``if an interested party or any other person--(A) withholds information
that has been requested by the administering authority or the
Commission under this title, (B) fails to provide such information by
the deadlines for submission of the information or in the form and
manner requested, subject to subsections (c)(1) and (e) of section 782,
(C) significantly impedes a proceeding under this title, or (D)
provides such information but the information cannot be verified as
provided in section 782(i), the administering authority and the
Commission shall, subject to section 782(d), use the facts otherwise
available in reaching the applicable determination under this title.''
Section 776(b) of the Act provides that adverse inferences may be
used when a party has failed to cooperate by not acting to the best of
its ability to comply with a request for information. The exporters
that decided not to respond in any form to the Department's
questionnaire failed to act to the best of their ability in this
investigation. Further, absent a response, we must presume government
control of these and all other PRC companies for which we cannot make a
separate rates determination. Thus, the Department has determined that,
in selecting from among the facts otherwise available, an adverse
inference is warranted.
As adverse facts available, we are assigning the highest margin in
the petition, 153.7 percent, which is higher than any of the calculated
margins.
Section 776(c) of the Act provides that where the Department
selects from among the facts otherwise available and relies on
``secondary information,'' such as the petition, the Department shall,
to the extent practicable, corroborate that information from
independent sources reasonably at the Department's disposal. The
Statement of Administrative Action accompanying the URAA, H.R. Doc. No.
103-316 (1994) (SAA), states that ``corroborate'' means to determine
that the information used has probative value. See SAA at 870.
The petitioner's methodology for calculating export price (``EP'')
and normal value (``NV'') is discussed in the
[[Page 41378]]
Notice of Initiation. To corroborate the petitioner's EP calculations,
we compared the prices in the petition for the product to the prices
submitted by respondents for the same product in similar volumes. To
corroborate the petitioner's NV calculations, we compared the
petitioner's factor consumption and surrogate value data for the
product to the data reported by the respondents for the most
significant factors--chemical inputs, factory overhead, and selling,
general, and administrative expenses--and the surrogate values for
these factors in the petition to the values selected for the
preliminary determination, as discussed below. Our analysis showed
that, in general, the petitioner's data was reasonably close to the
data submitted by the respondents or to the surrogate values chosen by
the Department. (See memorandum to the file dated July 22, 1999
(``Corroboration Memo'').) Based on our analysis, we find that the
calculations set forth in the petition have probative value.
Company-Specific Rates--Partial Facts Available
Freemen claims that despite its repeated demands, one of its
suppliers has refused to provide factors of production data to Freemen.
According to Freemen, this supplier, who supplied a relatively small
percentage of creatine sold by Freemen, has indicated that it will not
participate in any way in this investigation. Freemen has provided all
factors of production data from its other suppliers. Similarly, Blue
Science asserts that one of its suppliers, which accounts for a small
percentage of creatine sold by Blue Science, only produced the subject
merchandise on a trial basis and has since terminated production. As
such, the supplier was not able to provide complete factors of
production data to Blue Science.
We preliminarily determine that the use of adverse facts available
is warranted where the factors of production are missing or unusable.
Because certain producers of the subject merchandise neither provided
complete and accurate factors of production information nor
demonstrated satisfactorily why this is not possible, we find that
these interested parties have not cooperated to the best of their
abilities. Accordingly, as adverse facts available, we have applied a
margin of 153.70 percent, the highest margin from the petition, to
those sales for which we did not have complete factors of production.
Fair Value Comparisons
To determine whether sales of the subject merchandise by Tiancheng,
Sanjian, Blue Science, Nantong, Freemen, and Desano to the United
States were made at LTFV, we compared the EP to the NV, as described in
the ``Export Price'' and ``Normal Value'' sections of this notice,
below. In accordance with section 777A(d)(1)(A)(i) of the Act, we
compared POI-wide weighted-average EPs to weighted-average NVs.
Export Price
We used EP methodology in accordance with section 772(a) of the
Act, because the subject merchandise was sold directly to unaffiliated
customers in the United States prior to importation and CEP methodology
was not otherwise appropriate. We calculated EP based on packed CIF or
C&F prices to the first unaffiliated purchaser in the United States.
Where appropriate, we made deductions from the starting price (gross
unit price) for billing adjustments, inland freight from the plant/
warehouse to port of exit, brokerage and handling in the PRC, marine
insurance and ocean freight. Because certain domestic brokerage and
handling, marine insurance, and inland freight were provided by NME
companies, we based those charges on surrogate rates from India. (See
``Normal Value'' section for further discussion.)
Normal Value
1. Surrogate Country
Section 773(c)(4) of the Act requires the Department to value the
NME producer's factors of production, to the extent possible, in one or
more market economy countries that: (1) are at a level of economic
development comparable to that of the NME, and (2) are significant
producers of comparable merchandise. The Department has determined that
India, Pakistan, Sri Lanka, Egypt, Indonesia, and the Philippines are
countries comparable to the PRC in terms of overall economic
development (see memorandum from Jeff May, Director, Office of Policy,
to Susan Kuhbach, Senior Director, AD/CVD Enforcement, Office 1, March
26, 1999). According to the available information on the record, we
have determined that both India and Indonesia are significant producers
of comparable merchandise. Although we have no information to indicate
that India and Indonesia produce creatine, they do produce other
products within the same customs heading and produce other fine
chemicals with nutritional characteristics. Of these two countries,
India produces and exports more merchandise than Indonesia under United
National Standard International Trade Classification Revised number
514.82, ``carboxyamide-function compounds (including saccharin and its
salts) and imine-function compounds,'' the heading which includes
creatine. Accordingly, we have calculated NV using mainly Indian
values, and in some cases Indonesian values, for the PRC producers'
factors of production. We have obtained and relied upon publicly
available information wherever possible.
2. Factors of Production
In accordance with section 773(c) of the Act, we calculated NV
based on factors of production reported by the companies in the PRC
which produced creatine for the exporters that sold creatine to the
United States during the POI. To calculate NV, the reported unit factor
quantities were multiplied by publicly available Indian and Indonesian
values.
In selecting the surrogate values, we considered the quality,
specificity, and contemporaneity of the data. As appropriate, we
adjusted input prices to make them delivered prices. Where a producer
did not report the distance between the material supplier and the
factory, as facts available, we used either the distance to the nearest
seaport (if an import value was used as the surrogate value for the
factor) or the farthest distance reported for a supplier. Where
distances were reported, we added to Indian CIF surrogate values a
surrogate freight cost using the shorter of the reported distances from
either the closest PRC port to the PRC factory, or from the domestic
supplier to the factory. This adjustment is in accordance with the
CAFC's decision in Sigma Corp. v. United States, 117 F. 3d 1401
(Fed.Cir. 1997). For those values not contemporaneous with the POI and
quoted in a foreign currency, we adjusted for inflation using wholesale
price indices published in the International Monetary Fund's
International Financial Statistics.
Many of the inputs in the production and packing of creatine are
considered business proprietary data by the respondents. Due to the
proprietary nature of this data, we are unable to discuss many of the
inputs in this preliminary determination notice. For a complete
analysis of surrogate values, see the memorandum from the Team to the
file (``Factors of Production Memorandum''), dated July 22, 1999.
We valued labor using the method described in 19 CFR 351.408(c)(3).
[[Page 41379]]
To value electricity, we used the 1995 electricity rates reported
in the publication Energy Prices and Taxes, 4th quarter
1998. We based the value of coal on prices reported in Energy Prices
and Taxes, 2nd quarter 1998.
We based our calculation of factory overhead, SG&A, and profit on
1992-93 data from the ``Expenditures and Appropriations'' section of
the accounts of ``Processing and Manufacturing, Chemicals and products
thereof'' from the Reserve Bank of India Bulletin, January 1997.
To value truck freight rates, we used a 1994 rate from The Times of
India. For inland water transportation, we valued boat and barge
transportation using the surrogate values found in an August 1993 cable
from the US Embassy Bombay. With regard to rail freight, we based our
calculation on information from the Indian Railway Conference
Association.
For packing materials we used import values from the Monthly
Foreign Trade Statistics of India; Volume II Imports.
Critical Circumstances
In the February 12, 1999 petition, the petitioner alleged that
there is a reasonable basis to believe or suspect that critical
circumstances exist with respect to imports of creatine from the PRC.
In addition, the petitioner requested that the Department issue its
preliminary critical circumstances finding on an expedited basis
because importers, exporters and producers had an early warning of the
proceeding prior to the filing of the petition. The basis for
petitioner's contention was that PRC parties had advance knowledge of
the petition through a press release dated January 25, 1999, from a
public relations firm's website. The press report stated that the
petitioner would be filing an antidumping petition with the Department
and the ITC in order to seek the imposition of substantial, triple
digit dumping duties on all importers of creatine from China.
We examined whether conditions in the industry and published
reports and statements provided a basis for inferring knowledge that a
proceeding was likely. We preliminarily determine that the January 25,
1999 press report cited by the petitioner is insufficient to show that
such information was widely available. Our research of Lexis-Nexis and
Internet inquiries revealed nothing to indicate that the press release
was reported by any publication. Moreover, the petitioner did not
provide the Department with further documentation to support its
allegation. Therefore, because there is insufficient evidence on the
record indicating the likelihood of a proceeding concerning imports of
creatine from the PRC, we have not made an expedited critical
circumstances determination.
On April 8, 1999, the Department requested information regarding
shipments of creatine for the period September 1998 to June 1999 from
all respondents participating in this investigation. On May 13, May 14,
May 20 and July 6, 1999, we received the requested information from
Tiancheng, Sanjian, Blue Science, Nantong, Freemen and Desano. The
information submitted by Desano was limited to shipment data for the
period August 1998 to December 1998. Despite our subsequent request for
shipment data for the remaining time period (i.e., January 1999 to June
1999), Desano did not provide any additional information. On May 25,
1999, the petitioner argued that, based on the information submitted,
critical circumstances existed with respect to imports by Freemen.
Section 733(e)(1) of the Act provides that the Department will
determine that critical circumstances exist if there is a reasonable
basis to believe or suspect that: (A)(i) there is a history of dumping
and material injury by reason of dumped imports in the United States or
elsewhere of the subject merchandise, or (ii) the person by whom, or
for whose account, the merchandise was imported knew or should have
known that the exporter was selling the subject merchandise at less
than its fair value and that there was likely to be material injury by
reason of such sales, and (B) there have been massive imports of the
subject merchandise over a relatively short period.
With respect to the first criterion, we are not aware of any
antidumping order in any country on creatine from the PRC. Therefore,
we examined whether there was importer knowledge. In determining
whether there is a reasonable basis to believe or suspect that an
importer knew or should have known that the exporter was selling
creatine at less than fair value and thereby causing material injury,
the Department must rely on the facts before it at the time the
determination is made. The Department normally considers margins of 25
percent or more and a preliminary ITC determination of material injury
sufficient to impute knowledge of dumping and the likelihood of
resultant material injury.
On April 7, 1999, the ITC preliminary determination found that
there was a reasonable indication that the U.S. industry is materially
injured. See, Creatine Monohydrate from the People's Republic of China,
64 FR 16998 (April 7, 1999). Therefore, with respect to the PRC, we
preliminarily determine that there is a reasonable basis to believe or
suspect that importers knew or should have known that material injury
from the dumped merchandise was likely.
In determining whether there are ``massive imports'' over a
``relatively short time period'', the Department ordinarily bases its
analysis on import data for at least the three months preceding (the
``base period'') and following (the ``comparison period'') the filing
of the petition. Imports normally will be considered massive when
imports during the comparison period have increased by 15 percent or
more compared to imports during the base period. The Department
examines respondent-specific shipment information or aggregate import
statistics when respondent-specific shipment information is not
available.
To determine whether imports of subject merchandise have been
massive over a relatively short period, we compared each respondent's
export volume for five months prior to the filing of the petition
(September 1998 to January 1999) to that during the five months
subsequent to the filing of the petition (February 1999 to June 1999).
These periods were selected based on the Department's practice of using
the longest period for which information is available from the month
that the petition was submitted through the date of the preliminary
determination. For all other exporters, we performed the analysis using
import statistics.
Based on our analysis, we preliminarily determine that the increase
in imports was greater than 15 percent for Freemen and for all
producers/exporters of subject merchandise who were not analyzed or who
failed to submit a response. As explained above, one respondent--
Desano--did not comply with our request for shipment data for the
period January 1999 to June 1999. Accordingly, we find that the
information Desano submitted is so incomplete that it cannot serve as a
reliable basis for reaching a determination regarding massive imports
in this investigation. Therefore, pursuant to section 782(e) of the
Act, we preliminarily determine that there were massive imports with
respect to Desano based on adverse facts available. With regard to the
other four respondents, Tiancheng, Nantong, San Jian, and Blue Science,
we find that the increase in imports was not greater than 15 percent.
See Memorandum from Team to Richard W. Moreland, Deputy Assistant
Secretary, AD/CVD Enforcement Group I (``Critical
[[Page 41380]]
Circumstances Determination''), dated July 22, 1999.
On this basis, we preliminarily determine that critical
circumstances exist for Freemen, Desano and all other PRC exporters
except Tiancheng, Nantong, San Jian, and Blue Science.
We will make a final determination concerning critical
circumstances when we make our final determination of this
investigation.
Verification
As provided in section 782(i) of the Act, we will verify all
information relied upon in making our final determination.
Suspension of Liquidation
In accordance with section 733(d) of the Act, we are directing the
Customs Service to suspend liquidation of all imports of subject
merchandise from the PRC entered, or withdrawn from warehouse, for
consumption on or after the date of publication of this notice in the
Federal Register. In addition, for Desano and Freemen, as well as for
companies subject to the PRC-wide rate, we are directing Customs to
suspend liquidation of any unliquidated entries of subject merchandise
entered, or withdrawn from warehouse, for consumption on or after the
date 90 days prior to the date of publication of this notice in the
Federal Register. We will instruct the Customs Service to require a
cash deposit or the posting of a bond equal to the weighted-average
amount by which the NV exceeds the EP, as indicated in the chart below.
These suspension of liquidation instructions will remain in effect
until further notice.
------------------------------------------------------------------------
Weighted-
Exporter/manufacturer average margin Critical
percentage circumstances
------------------------------------------------------------------------
Blue Science International Trading 121.36 No.
(Shanghai) Co., Ltd.
Nantong Medicines and Health 1.63 No.
Products Import and Export Co.,
Ltd.
Shanghai Desano International 58.82 Yes.
Trading Co., Ltd.
Shanghai Freemen International 139.15 Yes.
Trading Co., Ltd., and Shanghai
Greenmen International Trading
Co., Ltd.
Suzhou Sanjian Fine Chemical Co., 152.67 No.
Ltd.
Tianjin Tiancheng Pharmaceutical 3.54 No.
Co., Ltd.
PRC-wide Rate...................... 153.70 Yes.
------------------------------------------------------------------------
The PRC-wide rate applies to all entries of the subject merchandise
except for entries from exporters/factories that are identified
individually above.
ITC Notification
In accordance with section 733(f) of the Act, we have notified the
ITC of our determination. If our final determination is affirmative,
the ITC will determine before the later of 120 days after the date of
this preliminary determination or 45 days after our final determination
whether these imports are materially injuring, or threaten material
injury to, the U.S. industry.
Public Comment
Case briefs or other written comments in six copies must be
submitted to the Assistant Secretary for Import Administration no later
than November 17, 1999, and rebuttal briefs no later than November 22,
1999. A list of authorities used and an executive summary of issues
should accompany any briefs submitted to the Department. Such summary
should be limited to five pages total, including footnotes. In
accordance with section 774 of the Act, we will hold a public hearing,
if requested, to afford interested parties an opportunity to comment on
arguments raised in case or rebuttal briefs. Tentatively, the hearing
will be held on November 29, 1999 at the U.S. Department of Commerce,
14th Street and Constitution Avenue, N.W., Washington, D.C. 20230.
Parties should confirm by telephone the time, date, and place of the
hearing 48 hours before the scheduled time.
Interested parties who wish to request a hearing, or to participate
if one is requested, must submit a written request to the Assistant
Secretary for Import Administration, U.S. Department of Commerce, Room
1870, within 30 days of the publication of this notice. Requests should
contain: (1) The party's name, address, and telephone number; (2) the
number of participants; and (3) a list of the issues to be discussed.
Oral presentations will be limited to issues raised in the briefs. If
this investigation proceeds normally, we will make our final
determination not later then 135 days after the publication of this
notice in the Federal Register.
This determination is issued and published in accordance with
sections 733(d) and 777(i)(1) of the Act.
Dated: July 22, 1999.
Robert S. LaRussa,
Assistant Secretary for Import Administration.
[FR Doc. 99-19609 Filed 7-29-99; 8:45 am]
BILLING CODE 3510-DS-P
