03-20319. Notice of Final Determination of Sales at Less Than Fair Value: Polyvinyl Alcohol from the People's Republic of China

AGENCY:

Import Administration, International Trade Administration, Department of Commerce.

EFFECTIVE DATE:

August 11, 2003.

FOR FURTHER INFORMATION CONTACT:

Elizabeth Eastwood or Alice Gibbons at [phone] and [phone], respectively, AD/CVD Enforcement, Office 2, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, NW, Washington, DC 20230.

SUPPLEMENTARY INFORMATION:

Final Determination:

We determine that polyvinyl alcohol (PVA) from the People's Republic of China (PRC) is being sold, or is likely to be sold, in the United States at less than fair value (LTFV), as provided in section 735 of the Tariff Act of 1930, as amended (the Act). The estimated margins of sales at LTFV are shown in the “Suspension of Liquidation” section of this notice.

Background

The preliminary determination in this investigation was issued on March 14, 2003. See Notice of Preliminary Determination of Sales at Less Than Fair Value and Postponement of Final Determination: Polyvinyl Alcohol from the People's Republic of China, 68 FR 13674 (March 20, 2003) (Preliminary Determination). Since the preliminary determination, the following events have occurred.

With respect to scope, on March 3, 2003, the petitioners agreed to revise the scope of the companion case on PVA from Japan to exclude certain types of PVA covalently bonded with diacetoneacrylamide. The petitioners' submission was made in response to a request by Japan VAM and POVAL Co., Ltd., one of the mandatory respondents in the companion Japanese case.

Because these comments relate to PVA in general, we find that they are applicable to this proceeding. Accordingly, as we did in the preliminary determination, we have modified the scope to conform to that set forth in the companion Japanese proceeding, as described in the “Scope of the Investigation” section of this notice below. See Notice of Final Determination of Sales at Less Than Fair Value: Polyvinyl Alcohol from Japan, 68 FR 19510 (April 21, 2003).

In March and April 2003, we conducted verification of the questionnaire responses of the sole participating respondent in this case, Sinopec Sichuan Vinylon Works (SVW).

We gave interested parties an opportunity to comment on the preliminary determination. In May, we received case and rebuttal briefs from the petitioners (Celanese Chemicals Ltd. and E.I. Dupont de Nemours & Company) and SVW. The Department held a public hearing on May 29, 2003, at the request of SVW.

Scope of the Investigation

The merchandise covered by this investigation is PVA. This product consists of all PVA hydrolyzed in excess of 80 percent, whether or not mixed or diluted with commercial levels of defoamer or boric acid, except as noted below.

The following products are specifically excluded from the scope of this investigation:

1) PVA in fiber form.

2) PVA with hydrolysis less than 83 mole percent and certified not for use in the production of textiles.

3) PVA with hydrolysis greater than 85 percent and viscosity greater than or equal to 90 cps.

4) PVA with a hydrolysis greater than 85 percent, viscosity greater than or equal to 80 cps but less than 90 cps, certified for use in an ink jet application.

5) PVA for use in the manufacture of an excipient or as an excipient in the manufacture of film coating systems which are components of a drug or dietary supplement, and accompanied by an end-use certification.

6) PVA covalently bonded with cationic monomer uniformly present on all polymer chains in a concentration equal to or greater than one mole percent.

7) PVA covalently bonded with carboxylic acid uniformly present on all polymer chains in a concentration equal to or greater than two mole percent, certified for use in a paper application.

8) PVA covalently bonded with thiol uniformly present on all polymer chains, certified for use in emulsion polymerization of non-vinyl acetic material.

9) PVA covalently bonded with paraffin uniformly present on all polymer chains in a concentration equal to or greater than one mole percent.

10) PVA covalently bonded with silan uniformly present on all polymer chains certified for use in paper coating applications.

11) PVA covalently bonded with sulfonic acid uniformly present on all polymer chains in a concentration level equal to or greater than one mole percent.

12) PVA covalently bonded with acetoacetylate uniformly present on all polymer chains in a concentration level equal to or greater than one mole percent.

13) PVA covalently bonded with polyethylene oxide uniformly present on all polymer chains in a concentration level equal to or greater than one mole percent.

14) PVA covalently bonded with quaternary amine uniformly present on all polymer chains in a concentration level equal to or greater than one mole percent.

15) PVA covalently bonded with diacetoneacrylamide uniformly present on all polymer chains in a concentration level greater than three mole percent, certified for use in a paper application.

The merchandise under investigation is currently classifiable under subheading 3905.30.00 of the Harmonized Tariff Schedule of the United States (HTSUS). Although the HTSUS subheading is provided for convenience and customs purposes, the written description of the merchandise under investigation is dispositive.

Period of Investigation

The period of investigation is January 1, 2002, through June 30, 2002, which corresponds to the two most recent fiscal quarters prior to the month of the filing of the petition (i.e., September 2002).

Nonmarket Economy Status for the PRC

The Department has treated the PRC as a nonmarket economy (NME) country in all past antidumping investigations. See, e.g., Notice of Final Determination of Sales at Less Than Fair Value: Pure Magnesium in Granular Form from the People's Republic of China, 66 FR 49345, 49346 (September 27, 2001). A designation as a NME remains in effect until it is revoked by the Department. See section 771(18)(C) of the Act. No party in this investigation has requested a revocation of the PRC's NME status. Therefore, we have continued to treat the PRC as an NME in this investigation. For further details, see Preliminary Determination, 68 FR at 13676.

Separate Rate

In our preliminary determination, we found that SVW had met the criteria for receiving a separate antidumping rate. We have not received any information since the preliminary determination which would warrant reconsideration of our separate-rate determination with respect to this company. Therefore, we continue to find that SVW should be assigned an individual dumping margin.

Surrogate Country

For purposes of the final determination, we continue to find that India is the appropriate primary surrogate country for the PRC. For further discussion and analysis regarding the surrogate country selection for the PRC, see Preliminary Determination, 68 FR at 13679.

PRC-Wide Rate and Use of Facts Otherwise Available

As explained in the Department's Preliminary Determination, SVW was the only exporter to respond to the Department's questionnaire and cooperate in this investigation. Therefore, we have continued to calculate a company-specific rate for SVW only. However, in the preliminary determination, we stated that our review of U.S. import statistics from the PRC revealed that SVW did not account for all imports into the United States from the PRC. For this reason, we determined that some PRC exporters of subject merchandise failed to cooperate in this investigation. In accordance with our standard practice, as adverse facts available, we are assigning as the PRC-wide rate the higher of: (1) the highest margin listed in the notice of initiation; or (2) the margin calculated for SVW. See, e.g., Final Determination of Sales at Less Than Fair Value: Certain Cold-Rolled Flat-Rolled Carbon Quality Steel Products From The People's Republic of China, 65 FR 34660 (May 31, 2000), and accompanying decision memorandum at Comment 1. For purposes of the final determination of this investigation, we are using the margin stated in the notice of initiation (i.e., 97.86 percent) as adverse facts available because it is higher than the margin we calculated for SVW.

Analysis of Comments Received

All issues raised in the case briefs by parties to this proceeding and to which we have responded are listed in the Appendix to this notice and addressed in the Decision Memorandum, which is adopted by this notice. Parties can find a complete discussion of all issues raised in this investigation and the corresponding recommendations in this public memorandum, which is on file in the Central Records Unit, room B-099, of the main Department building. In addition, a complete version of the Decision Memorandum can be accessed directly on the Web at http://ia.ita.doc.gov. The paper copy and electronic version of the Decision Memorandum are identical in content.

Changes Since the Preliminary Determination

Based on our analysis of comments received, we have made certain changes to the margin calculations. For a discussion of these changes, see the “Margin Calculations” section of the Decision Memorandum.

Verification

As provided in section 782(i) of the Act, we verified the information submitted by the respondent for use in our final determination. We used standard verification procedures including examination of relevant accounting and production records, and original source documents provided by the respondent.

Continuation of Suspension of Liquidation

In accordance with section 735(c)(1)(B) of the Act, we are directing the U.S. Bureau of Customs and Border Protection (BCBP) to continue to suspend liquidation of all entries of PVA from the PRC, except for PVA exported by SVW, that are entered, or withdrawn from warehouse, for consumption on or after March 20, 2003, the date of publication of our preliminary determination. Regarding SVW, we have calculated a margin for this final determination which is not de minimis. Therefore, we are directing the BCBP to begin suspending liquidation of entries of PVA exported by SVW that are entered, or withdrawn from warehouse, for consumption on or after the date of publication of this determination in the Federal Register. The BCBP shall require a cash deposit or the posting of a bond equal to the estimated amount by which the normal value exceeds the U.S. price as shown below. These instructions suspending liquidation will remain in effect until further notice.

The dumping margins are provided below:

Manufacturer/exporter	Margin ­(percent)
Sinopec Sichuan Vinylon Works	7.40
PRC-wide	97.86

The PRC-wide rate applies to all entries of the subject merchandise except for entries from SVW.

Disclosure

We will disclose the calculations performed within five days of the date of publication of this notice to parties in this proceeding in accordance with 19 CFR 351.224(b).

ITC Notification

In accordance with section 735(d) of the Act, we have notified the International Trade Commission (ITC) of our determination. As our final determination is affirmative, the ITC will, within 45 days, determine whether these imports are materially injuring, or threaten material injury to, the U.S. industry. If the ITC determines that material injury or threat of material injury does not exist, the proceeding will be terminated and all securities posted will be refunded or canceled. If the ITC determines that such injury does exist, the Department will issue an antidumping duty order directing the BCBP to assess antidumping duties on all imports of the subject merchandise entered, or withdrawn from warehouse, for consumption on or after the effective date of the suspension of liquidation.

Notification Regarding APO

This notice also serves as a reminder to parties subject to administrative protective order (APO) of their responsibility concerning the disposition of proprietary information disclosed under APO in accordance with 19 CFR 351.305. Timely notification of return/destruction of APO materials or conversion to judicial protective order is hereby requested. Failure to comply with the regulations and the terms of an APO is a sanctionable violation.

This determination is issued and published pursuant to sections 735(d) and 777(i)(1) of the Act.

Dated: August 4, 2003.

Joseph A. Spetrini,

Acting Assistant Secretary for Grant Aldonas, Under Secretary.

Appendix Issues in the Decision Memorandum

Comments

1. Valuation of an Input Supplied by a Joint Venture Partner

2. Treatment of Acetylene Tail Gas as Co-Product vs. By-Product

3. Cost Allocation Methodology for Acetylene and Acetylene Tail Gas

4. Adjustment of Factors of Production for Vinyl Acetate Monomer (VAM)

5. Surrogate Value for Activated Carbon

6. Surrogate Value for Natural Gas

7. Valuation of N-Methyl-2-Pyrrolidone (NMP)

8. Clerical Error in the Preliminary Determination

9. Application of a By-Product Credit in the Calculation of the Surrogate Financial Ratios

10. Adjustments to the Surrogate Financial Ratios for Differences in Integration Levels

11. Surrogate Value for Ocean Freight