[Federal Register Volume 64, Number 151 (Friday, August 6, 1999)]
[Notices]
[Pages 42912-42916]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-20337]
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DEPARTMENT OF COMMERCE
International Trade Administration
[A-570-847]
Persulfates From the People's Republic of China: Preliminary
Results of Antidumping Duty Administrative Review, and Partial
Rescission of Administrative Review
AGENCY: Import Administration, International Trade Administration,
Department of Commerce.
SUMMARY: The Department of Commerce is conducting an administrative
review of the antidumping duty order on persulfates from the People's
Republic of China in response to requests by the petitioner, FMC
Corporation, and by two manufacturers/exporters of the subject
merchandise. The period of review is December 27, 1996, through June
30, 1998.
With respect to Guangdong Petroleum Chemical Import & Export Trade
Corporation, this review has now been rescinded as a result of the
withdrawal request for administrative review by the petitioner, the
interested party that requested review of Guangdong Petroleum.
We have preliminarily found that sales of subject merchandise by
Shanghai Ai Jian Import & Export Corporation and Sinochem Jiangsu Wuxi
Import & Export Corporation have been made below normal value. If these
preliminary results are adopted in our final results of administrative
review, we will instruct the Customs Service to assess antidumping
duties based on the difference between the export price and the normal
value.
EFFECTIVE DATE: August 6, 1999.
FOR FURTHER INFORMATION CONTACT: Sunkyu Kim or James Nunno, AD/CVD
Enforcement Group I, Office II, Import Administration, International
Trade Administration, U.S. Department of Commerce, 14th Street and
Constitution Avenue, NW., Washington, DC 20230; telephone: (202) 482-
2613 or (202) 482-0783, respectively.
APPLICABLE STATUTE AND REGULATIONS: Unless otherwise indicated, all
citations to the Tariff Act of 1930, as amended (the Act), are
references to the
[[Page 42913]]
provisions effective January 1, 1995, the effective date of the
amendments made to the Act by the Uruguay Round Agreements Act. In
addition, unless otherwise indicated, all citations to the Department
of Commerce's (the Department's) regulations are to the regulations at
19 CFR part 351 (April 1998).
SUPPLEMENTARY INFORMATION:
Background
On July 22, 1997, the Department published in the Federal Register
an amended antidumping duty order on persulfates from the People's
Republic of China (PRC). See 62 FR 39212. On July 31, 1998, in
accordance with 19 CFR 351.213(b), the petitioner requested an
administrative review of Shanghai Ai Jian Import & Export Corporation
(Ai Jian), Sinochem Jiangsu Wuxi Import & Export Corporation (Wuxi),
and Guangdong Petroleum Chemical Import & Export Trade Corporation
(Guangdong Petroleum). We also received requests for a review from Ai
Jian and Wuxi on July 31, 1998. We published a notice of initiation of
this review on August 27, 1998 (63 FR 45796).
On September 9, 1998, we issued an antidumping questionnaire to Ai
Jian and Wuxi. On September 10, 1998, we issued an antidumping
questionnaire to Guangdong Petroleum. The Department received responses
from the three exporters in November 1998. In addition, the Department
received responses from Shanghai Ai Jian Reagent Works (AJ Works)
(producer for Ai Jian and Wuxi) and Guangzhou Zhujian Electrochemical
Factory (producer for Guangdong Petroleum). On November 23, 1998, the
petitioner withdrew its request for an administrative review with
respect to Guangdong Petroleum. See Partial Rescission of
Administrative Review section of the notice below.
We issued supplemental questionnaires to Ai Jian, Wuxi, and AJ
Works in December 1998. Responses to these questionnaires were received
in February 1999.
In January 1999, the two exporters and the petitioner submitted
publicly available information and comments for consideration in
valuing the factors of production. In February 1999, the parties
submitted rebuttal comments.
Under section 751(a)(3)(A) of the Act, the Department may extend
the deadline for issuing a preliminary determination in an
administrative review if it determines that it is not practicable to
complete the preliminary review within the statutory time limit of 245
days. On March 4, 1999, the Department published a notice of extension
of the time limit for the preliminary results in this case to August 2,
1999. See Persulfates From the People's Republic of China: Postponement
of Preliminary Results of Antidumping Duty Administrative Review, 64 FR
10444 (March 4, 1999).
In May 1999, we verified the respondents' questionnaire responses.
Scope of Review
The products covered by this review are persulfates, including
ammonium, potassium, and sodium persulfates. The chemical formula for
these persulfates are, respectively, (NH sub4) sub2 S sub2 O sub8, K
sub2 S sub2 O sub8, and Na sub2 S sub2 O sub8. Ammonium and potassium
persulfates are currently classified under subheading 2833.40.60 of the
Harmonized Tariff Schedule of the United States (HTSUS). Sodium
persulfate is classified under HTSUS subheading 2833.40.20. Although
the HTSUS subheadings are provided for convenience and customs
purposes, our written description of the scope of this review is
dispositive.
Verification
As provided in section 782(i) of the Act, we verified information
provided by the respondents. We used standard verification procedures,
including on-site inspection of the respondents' facilities, the
examination of relevant sales and financial records, and selection of
original documentation containing relevant information. Based on
verification, we made certain original documentation containing
relevant information. Based on verification, we made certain changes to
the data in the sales and factors of production listings submitted by
Ai Jian and AJ Works, respectively, and used the revised data to
calculate the preliminary margins. See the U.S. Price and Factors of
Production Adjustments for the Preliminary Results Memorandum from the
Team to the File, dated August 2, 1999. Our verification results are
outlined in the verification reports placed on file in the Central
Records Unit (CRU) in room B-099 of the Main Commerce Building.
Partial Rescission of Administrative Review
On November 23, 1998, the petitioner withdrew its request for an
administrative review with respect to Guangdong Petroleum. Pursuant to
19 CFR 351.213(d)(1), the Department may allow a party that requests an
administrative review to withdraw such request not later than 90 days
after the date of publication of the notice of initiation of the
administrative review. The petitioner's request for withdrawal was
timely and there were no requests for review from other interested
parties. Therefore, the Department is rescinding this review with
respect to Guangdong Petroleum.
Separate Rates
It is the Department's policy to assign all exporters of the
merchandise subject to review in non-market-economy (NME) countries a
single rate, unless an exporter can demonstrate an absence of
government control, both in law and in fact, with respect to exports.
To establish whether an exporter is sufficiently independent of
government control to be entitled to a separate rate, the Department
analyzes the exporter in light of the criteria established in the Final
Determination of Sales at Less Than Fair Value: Sparklers from the
People's Republic of China, 56 FR 20588 (May 6, 1991( (Sparklers), as
amplified in the Final Determination of Sales at Less Than Fair Value:
Silicon Carbide from the People's Republic of China, 59 FR 22585 (May
2, 1994) (Silicon Carbide). Evidence supporting, though not requiring,
a finding of de jure absence of government control over export
activities includes: (1) an absence of restrictive stipulations
associated with an individual exporter's business and export licenses;
(2) any legislative enactments decentralizing control of companies; and
(3) any other formal measures by the government decentralizing control
of companies. Evidence relevant to a de facto absence of government
control with respect to exports is based on four factors, whether the
respondent: (1) sets its own export prices independent from the
government and other exporters; (2) can retain the proceeds from its
export sales; (3) has the authority to negotiate and sign contracts;
and (4) has autonomy from the government regarding the selection of
management. See Silicon Carbide, 59 FR at 22587; see also Sparklers, 56
FR at 20589.
With respect to Ai Jian and Wuxi, for purposes of our final
determination for the less than fair value (LTFV) investigation
covering the period January through June 1996, the Department
determined that there was de jure and de facto absence of government
control of each company's export activities and determined that each
company warranted a company-specific dumping margin. See Notice of
Final Determination of Sales at Less Than Fair Value: Persulfates from
the People's Republic of China, 62 FR 27222 (May 19, 1997) (Persulfates
Final Determination). For this administrative review, Ai Jian and Wuxi
have
[[Page 42914]]
responded to the Department's request for information regarding
separate rates. We have found that the evidence on the record is
identical with the evidence on the record of the LTFV investigation of
persulfates from the PRC (see Persulfates Final Determination, 62 FR at
27222), and continues to demonstrate an absence of government control,
both in law and in fact, with respect to their exports, in accordance
with the criteria identified in Sparklers and Silicon Carbide. In
addition, during verification, we examined Ai Jian and Wuxi's business
and financial activities, and found that both exporters operate
independently with respect to exports. See Sales Verification Report
for both Ai Jian and Wuxi, dated June 24, 1999.
Export Price
For both AJ and Wuxi, we calculated EP in accordance with section
772(a) of the Act, because the subject merchandise was sold directly to
the first unaffiliated purchaser in the United States prior to
importation and constructed export price (CEP) methodology was not
otherwise warranted, based on the facts of record. We calculated EP
based on packed, CIF U.S. port, or FOB PRC port, prices to unaffiliated
purchasers in the United States, as appropriate. We made deductions
from the starting price, where appropriate, for ocean freight services
which were provided by market economy suppliers. We also deducted from
the starting price, where appropriate, an amount for foreign inland
freight, foreign brokerage and handling, and marine insurance. As these
movement services were provided by NME suppliers, we valued them using
Indian rates. See ``Normal Value'' section for further discussion.
Normal Value
Section 773(c)(1) of the Act provides that the Department shall
determine the normal value (NV) using a factors-of-production
methodology if: (1) the merchandise is exported from an NME county; and
(2) the information does not permit the calculation of NV using home-
market prices, third-country prices, or constructed value under section
773(a) of the Act.
The Department has treated the PRC as an NME country in all
previous antidumping cases. Furthermore, available information does not
permit the calculation of NV using home market prices, third country
prices, or constructed value under section 773(a) of the Act. In
accordance with section 771(18)(C)(i) of the Act, any determination
that a foreign country is an NME country shall remain in effect until
revoked by the administering authority. None of the parties to this
proceeding has contested such treatment in this review. Therefore, we
treated the PRC as an NME country for purposes of this review and
calculated NV by valuing the factors of production in a comparable
market economy country which is a significant producer of comparable
merchandise.
Section 773(c)(4) of the Act and 19 CFR 351.408 direct us to select
a surrogate country that is economically comparable to the PRC. On the
basis of per capita gross domestic product (GDP), the growth rate in
per capita GDP, and the national distribution of labor, we find that
India is a comparable economy to the PRC. See Memorandum from Director,
Office of Policy, to Office Director, AD/CVD Group I, Office 2, dated
December 21, 1998.
Section 773(c)(4) of the Act also requires that, to the extent
possible, the Department use a surrogate country that is a significant
producer of merchandise comparable to persulfates. For purposes of the
LTFV investigation, we found that India was a significant producer of
comparable merchandise. See Notice of Preliminary Determination of
Sales at Less Than Fair Value and Postponement of Final Determination:
Persulfates from the People's Republic of China, 61 FR 68232, 68233
(December 27, 1996) (Persulfates Preliminary Determination). For
purposes of this administrative review, we find that India is a
producer of persulfates based on information submitted by the
respondents in their January 25, 1999, submission. Therefore, we have
continued to use India as the surrogate country and have used publicly
available information relating to India, unless otherwise noted, to
value the various factors of production.
For purposes of calculating NV, we valued PRC factors of
production, in accordance with section 773(c)(1) of the Act. Factors of
production include, but are not limited to: (1) Hours of labor
required; (2) quantities of raw materials employed; (3) amounts of
energy and other utilities consumed; and (4) representative capital
cost, including depreciation. In examining surrogate values, we
selected, where possible, the publicly available value which was: (1)
an average non-export value; (2) representative of a range of prices
within the POR or most contemporaneous with the POR; (3) product-
specific; and (4) tax-exclusive. For a more detailed explanation of the
methodology used in calculating various surrogate values, see the
Preliminary Results Factors Valuation Memorandum from the Team to the
File, dated August 2, 1999 (Factors Memorandum). In accordance with
this methodology, we valued the factors of production as follows:
To value ammonium sulfate, caustic soda, and sulfuric acid, we used
public information from POR issues of the Indian publication Chemical
Weekly, as provided by the respondents in their January 25, 1999,
submission. For caustic soda and sulphuric acid, because price quotes
reported in the Chemical Weekly are for chemicals with a 100 percent
concentration level, we made chemical purity adjustments according to
the particular concentration levels of caustic soda and sulphuric acid
used by respondents. For potassium sulfate and anhydrous ammonia, we
relied on import prices contained in the March and December 1997 issues
of Monthly Statistics of the Foreign Trade of India (Monthly
Statistics), as provided by the respondents in their January 25, 1999,
submission. Consistent with our methodology used in the LTFV
investigation of this proceeding, we used AJ Works' calculated cost of
manufacturing based on the information submitted on February 4, 1999,
as revised at verification, to value the cost of ammonium persulfates.
Where necessary, we adjusted the values reported in the Chemical Weekly
to exclude sales and excise taxes. For those values not contemporaneous
with the POR, we adjusted for inflation using the wholesale price
indices (WPI) published by the International Monetary Fund (IMF). We
made further adjustments to account for freight costs between the
suppliers and AJ Works' manufacturing facilities.
In accordance with our practice, we added to CIF import 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 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 61977 (November 20, 1997).
We valued labor based on a regression-based wage rate, in
accordance with 19 CFR 351.408(c)(3).
For electricity, we relied upon public information from an August
6, 1996, article in Business World to obtain an average price for
electricity provided to industries in India. To value water we relied
on public information reported in the October 1997 publication of the
Second Water Utilities Data Book: Asian and Pacific Region. We adjusted
the values to reflect inflation up to the POR using the WPI published
by the IMF.
[[Page 42915]]
As noted in the verification report for AJ Works, company officials
indicated that the factory used coal in its production of persulfates.
See Memorandum for the File for AJ Works, dated June 24, 1999, at page
9. Because the factory had not previously reported factors of
production for coal, we used, as facts available, the consumption
amounts reported during the LTFV investigation (for the period January
through June, 1996). The respondents placed this data on the record of
this administrative review on July 13, 1999. To value coal, we relied
on public information reported in the antidumping new shipper review
for Freshwater Crawfish Tail Meat from the PRC. See Freshwater Crawfish
Tail Meat From The People's Republic of China; Preliminary Results of
New Shipper Review, 64 FR 8543, 8545 (February 22, 1999), and Factors
Memorandum at page 2. We adjusted the values to reflect inflation up to
the POR using the WPI published by the IMF. Additionally, we adjusted
the value for coal to account for freight costs incurred between the
suppliers and AJ Works.
For the reported packing materials (i.e., polyethylene and woven
bags, polyethylene sheet, wood pallets, fiberboard, and polypropylene
sacks), we relied upon Indian import data from the March and December
1997 issues of Monthly Statistics. We adjusted the values to reflect
inflation up to the POR using the WPI published by the IMF.
Additionally, we adjusted these values to account for freight costs
incurred between the suppliers and AJ Works.
For foreign inland freight, we use the April 1994 truck rate from
the Times of India. For ocean freight we used the verified per-unit
expense reported by Ai Jian in its February 4, 1999, section C
supplemental submission because Ai Jian incurred ocean freight expenses
that were paid in U.S. dollars to a market economy supplier. For marine
insurance and foreign brokerage and handling expenses, we used public
information reported in the antidumping duty investigations of sulfur
dyes, including sulfur vat dyes, from India and stainless steel bar
from India, respectively. See Final Determination of Sales at Lesser
Than Fair Value: Sulphur Dyes, Including Vat Dyes from India, 58 FR
11385 (March 1, 1993); Final Determination of Sales at Less Than Fair
Value: Stainless Steel Bar from India, 59 FR 66915 (December 28, 1994);
Factors Memorandum at page 5. We adjusted the values to reflect
inflation up to the POR using the WPI published by the IMF.
For factory overhead (FOH), selling, general, and administrative
expenses (SG&A), and profit, relied on the financial statements of
Calibre Chemicals Pvt. Limited (Calibre), an Indian producer of
potassium persulfates and other chemicals, which were submitted by the
respondents, because this company is a producer of subject merchandise.
Due to the differing cost structures between Calibre's production
of subject and non-subject merchandise, it is more reliable to
calculate FOH as a percentage of the total raw material costs for
subject merchandise, as opposed to calculating FOH as a percentage of
total materials, labor, and energy costs for all products. Therefore,
we used the methodology proposed by the petitioner in its February
16,1999, submission in order to calculate FOH. See Factors Memorandum
at page 6. We adjusted the SG&A percentage that the respondents
calculated from Calibre's financial statements as follows: (1) we used
data from both Calibre's 1997 and 1998 fiscal years; (2) we considered
Calibre's ``transportation and distribution'' expenses to be tied to
the movement of finished goods and, therefore, excluded them from
Calibre's cost of manufacturing; (3) we reclassified Calibre's
``service and job work'' expenses as SG&A expenses; (4) we excluded all
depreciation cost, as we considered them to be part of FOH; and(5) we
used Califbre's sale of scrap to offset its cost of manufacturing, not
its SG&A expenses. We adjusted the profit percentage calculated by the
respondents to reflect the average profit from both Calibre's 1997 and
1998 fiscal years. In addition, we removed from the profit calculation
the excise duties and sales taxes. See Persulfates Preliminary
Determination, 61 FR at 68236.
Preliminary Results of the Review
We preliminarily determine that the following margins exist for the
period December 27, 1999, through June 30, 2998.
------------------------------------------------------------------------
Martin
Manufacturer/exporter (percent)
------------------------------------------------------------------------
Shanghai Ai Jian Import & Export Corporation............... 4.27
Sinochem Jiangsu Wuxi Import & Export Corporation.......... 5.34
------------------------------------------------------------------------
Interested parties may request a hearing within 30 days of
publication of this notice. See 19 CFR 351.310(c). Any hearing, if
requested, will be held 44 days after the date of publication of this
notice or the first workday thereafter. Interested parties may submit
case briefs within 30 days of publication. Rebuttal briefs, limited to
issues raised in the case briefs, may be filed no later than 35 days
after the date of publication. Parties who submit case briefs or
rebuttal briefs in this proceeding are requested to submit with each
argument (1) a statement of the issues and (2) a brief summary of the
argument. Parties are also encouraged to provide a summary of the
arguments not to exceed five pages and a table of statues, regulations,
and cases cited.
The Department will subsequently issue the final results of thus
administrative review, including the results of its analysis of issues
raised in any such written briefs or at the hearing, if held, not later
than 120 days after the date of publication of this notice.
The Department shall determine and the Customs Service shall assess
antidumping duties on all appropriate entries. The Department will
issue appropriate appraisement instructions directly to the Customs
Service upon completion of this review. The final results of this
review shall be the basis for the assessment of antidumping duties on
entries of merchandise covered by this review and for future deposits
of estimated duties. For assessment purposes, we do not have the
information to calculate an estimated entered value. Accordingly, we
have calculated importer specific duty assessment rates for the
merchandise by aggregating the dumping margins calculated for all U.S.
sales and dividing this amount by the total quantity of those sales.
This rate will be assessed uniformly on all entries of that particular
importer made during the POR.
Furthermore, the following deposit requirements will be effective
upon publication of the final results of this antidumping duty
administrative review for all shipments of the subject merchandise
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 for each reviewed company will be that established in
the final results of this administrative review; (2) the cash deposit
rate for Guangdong Petroleum will continue to be 34.97 percent, the
company-specific rate from the LTFV investigation; (3) the cash deposit
rate for all other PRC exporters will continue to be 119.02 percent,
the PRC-wide rate established in the LTFV investigation; 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 requirements, when imposed, shall remain in effect until
publication of the final results of the next administrative review.
[[Page 42916]]
Notification of Interest Parties.
This notice serves as a preliminary reminder to importers of their
responsibility under 19 CFR 351.402(f) 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 is issued and published in accordance
with sections 751(a)(1) and 777(i)(1) of the Act.
Dated: July 30, 1999.
Joseph A. Spetrini,
Acting Assistant Secretary for Import Administration.
[FR Doc. 99-20337 Filed 8-3-99; 8:45 am]
BILLING CODE 3510-DS-M
