[Federal Register: April 21, 2003 (Volume 68, Number 76)]
[Notices]
[Page 19510-19513]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr21ap03-52]
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DEPARTMENT OF COMMERCE
International Trade Administration
[A-588-861]
Notice of Final Determination of Sales at Less Than Fair Value:
Polyvinyl Alcohol from Japan
AGENCY: Import Administration, International Trade Administration,
Department of Commerce.
EFFECTIVE DATE: April 21, 2003.
FOR FURTHER INFORMATION CONTACT: Mike Strollo or Gregory E. Kalbaugh at
(202) 482-0629 or (202) 482-3693, respectively, Office of 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 Japan is being sold,
or is likely to be sold, in the United States at
[[Page 19511]]
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
February 12, 2003. See Notice of Preliminary Determination of Sales at
Less Than Fair Value: Polyvinyl Alcohol from Japan, 68 FR 8203 (Feb.
20, 2003) (Preliminary Determination).
Since the preliminary determination, the following events have
occurred. On February 21, 2003, the Nippon Synthetic Chemical Industry
Co., Ltd. (Nippon Gohsei), one of the mandatory respondents in this
investigation, notified the Department that it would no longer
participate in this investigation, and it requested that the Department
remove its business proprietary information from the record of this
proceeding. On February 27, 2003, the Department destroyed Nippon
Gohsei's submissions containing business proprietary information and
notified Nippon Gohsei of this action. For further discussion, see the
``Facts Available (FA)'' section of this notice.
On March 3, 2003, the petitioners agreed to revise the scope to
exclude certain types of PVA covalently bonded with
diacetoneacrylamide, pursuant to a request by one of the mandatory
respondents in this case, Japan VAM and POVAL Co., Ltd. (Japan VAM &
POVAL). For a description of this merchandise, see the ``Scope of the
Investigation'' section below. There were no case or rebuttal briefs
submitted. A public hearing was not requested.\1\
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\1\ Normally, when the Department issues a final determination,
the Federal Register notice is accompanied by a separate Issues and
Decision Memorandum. Since no briefs were filed in this case, we
have not issued a separate memorandum.
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Scope of 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 (POI) is July 1, 2001, through June 30,
2002. This period corresponds to the four most recent fiscal quarters
prior to the month of the filing of the petition (i.e., September
2002).
Facts Available (FA)
In the preliminary determination, we based the dumping margin for
three of the four mandatory respondents in this case, Denki Kagaku
Kogyo Kabushiki Kaisha (Denki Kagaku), Japan VAM & POVAL, and Kuraray
Co., Ltd. (Kuraray), on adverse facts available pursuant to section
776(b) of the Act. The use of adverse facts available was warranted
because Denki Kagaku, Japan VAM & POVAL, and Kuraray, as mandatory
respondents, failed to supply the information requested in the
antidumping duty questionnaires issued to them. Therefore, we found
that Denki Kagaku, Japan VAM & POVAL, and Kuraray failed to cooperate
by not acting to the best of their ability. As a result, pursuant to
section 776(b) of the Act, we used an adverse inference in selecting
from the facts available. Specifically, we assigned Denki Kagaku, Japan
VAM & POVAL, and Kuraray the highest margin alleged in the notice of
initiation. A complete explanation of both the selection and
application of facts available can be found in the Preliminary
Determination, 68 FR at 8205. We have done a new corroboration analysis
which is discussed below.
No interested parties have commented on the use of adverse facts
available for Denki Kagaku, Japan VAM & POVAL, and Kuraray in this
investigation, or to the choice of the facts available margin.
Accordingly, for the final determination, we are continuing to use the
highest margin alleged in the notice of initiation for Denki Kagaku,
Japan VAM & POVAL, and Kuraray. See the Preliminary Determination, 68
FR at 8209. Moreover, we continue to find that the data on which this
margin is based has probative value, as discussed below in the
``Corroboration of Information'' section of this notice.
Regarding the fourth mandatory respondent, Nippon Gohsei, on
February 21, 2003, this company notified the Department that it would
no longer participate in the investigation. Section 776(a)(2) of the
Act provides that, if an interested party (A) withholds information
requested by the Department, (B) fails to provide such information by
the deadline, or in the
[[Page 19512]]
form or manner requested, (C) significantly impedes a proceeding, or
(D) provides information that cannot be verified, the Department shall
use, subject to sections 782(d) and (e) of the Act, facts otherwise
available in reaching the applicable determination. Because Nippon
Gohsei provided information to the Department but subsequently withdrew
that information from the record of this case, we have applied FA to
calculate its dumping margin, pursuant to section 776(a)(2)(C) of the
Act.
In selecting from among the facts otherwise available, section
776(b) of the Act authorizes the Department to use an adverse inference
if the Department finds that an interested party failed to cooperate by
not acting to the best of its ability to comply with a request for
information. See, e.g., Notice of Final Determination of Sales of Less
Than Fair Value and Final Negative Critical Circumstances: Carbon and
Certain Alloy Steel Wire Rod from Brazil, 67 FR 55792, 55794-96 (Aug.
30, 2002). Nippon Gohsei was notified in the Department's original and
supplemental questionnaires that failure to submit the requested
information by the dates specified might result in use of FA. After the
Department issued its preliminary determination, Nippon Gohsei: 1)
notified the Department that it would no longer participate in this
investigation; and 2) withdrew its submissions containing business
proprietary information from the record. Without Nippon Gohsei's data,
we are unable to calculate a dumping margin for Nippon Gohsei. As a
consequence, we find that Nippon Gohsei has failed to cooperate to the
best of its ability. As Nippon Gohsei failed to cooperate to the best
of its ability, we are applying an adverse inference pursuant to
section 776(b) of the Act.
Corroboration of Information
Section 776(b) of the Act authorizes the Department to use as AFA
information derived from the petition, the final determination from the
LTFV investigation, a previous administrative review, or any other
information placed on the record.
Section 776(c) of the Act requires the Department to corroborate,
to the extent practicable, secondary information used as FA. Secondary
information is defined as ``{i{time} nformation derived from the
petition that gave rise to the investigation or review, the final
determination concerning the subject merchandise, or any previous
review under section 751 concerning the subject merchandise.'' See
Statement of Administrative Action (SAA) accompanying the Uruguay Round
Agreements Act, H.R. Doc. No. 103-316 at 870 (1994) and 19 CFR
351.308(d).
The SAA clarifies that ``corroborate'' means that the Department
will satisfy itself that the secondary information to be used has
probative value. See the SAA at 870. The SAA also states that
independent sources used to corroborate such evidence may include, for
example, published price lists, official import statistics and customs
data, and information obtained from interested parties during the
particular investigation. Id.
In the preliminary determination, we corroborated the margins in
the petition using information submitted by Nippon Gohsei. However,
because Nippon Gohsei has withdrawn this information from the record of
this case, we have re-examined the issue of corroboration for the final
determination.
Therefore, in order to determine the probative value of the margins
in the petition for use as AFA for purposes of this determination, we
examined additional evidence supporting the calculations in the
petition. We reviewed the adequacy and accuracy of the information in
the petition during our pre-initiation analysis of the petition, to the
extent appropriate information was available for this purpose (see the
September 25, 2002, Initiation Checklist, on file in the Central
Records Unit, Room B-099, of the Main Commerce Department building, for
a discussion of the margin calculations in the petition). In accordance
with section 776(c) of the Act, to the extent practicable, we examined
the key elements of the export price (EP) and normal value (NV)
calculations on which the margins in the petition were based.
Export Price
With respect to the margins in the petition, EP was based on POI
price quotes for the sale of PVA produced by Kuraray to customers in
the United States. The petitioners calculated net U.S. prices for PVA
by deducting a distributor mark-up, where applicable, and certain
movement charges.
For purposes of corroborating the price-to-price calculations in
the petition, we compared these prices to U.S. customs data. Using U.S.
customs data, we calculated the average U.S. price of imports from all
mandatory respondents. We found that the petitioners' price quotes were
comparable to the U.S. Customs information. Therefore, we find that the
petitioners' information for U.S. price continues to have probative
value.
For further discussion, see the April 28, 2003, memorandum to the
file from the team entitled ``Corroboration of Data Contained in the
Petition for Assigning Facts Available Rates'' (Corroboration Memo).
Normal Value
The petitioners based NV on home market price quotes from Kuraray
for PVA of a comparable grade to the products exported to the United
States. These price quotes were contemporaneous with the U.S. price
quotes used as the basis for EP. In addition, the petitioners alleged
that sales of PVA products in the home market were made at prices below
the fully absorbed cost of production (COP), within the meaning of
section 773(b) of the Act, and requested that the Department conduct a
country-wide sales-below-cost investigation. Based upon a comparison of
the prices of the foreign like product in the home market to the
calculated COP of the product, we found reasonable grounds to believe
or suspect that sales of the foreign like product were made below the
COP, within the meaning of section 773(b)(2)(A)(i) of the Act.
Accordingly, the Department initiated a country-wide cost
investigation. Pursuant to section 773(b)(3) of the Act, COP consisted
of the cost of manufacture (COM), selling, general and administrative
(SG&A) expenses, and packing. The petitioners calculated COP based on
the experience of a U.S. PVA producer during the 2001 fiscal year,
adjusted for known differences between costs incurred to manufacture
PVA in the United States and Japan.
Pursuant to sections 773(a)(4), 773(b) and 773(e) of the Act, the
petitioners based NV for sales in Japan on constructed value (CV). The
petitioners calculated CV using the same COM, SG&A and financial
expense figures used to compute the COP. Consistent with section
773(e)(2) of the Act, the petitioners included in CV an amount for
profit. For profit, the petitioners relied upon the amount reported in
Kuraray's 2001 financial statements. The petitioners made a
circumstance-of-sale adjustment for credit expenses.
The Department was provided with no useful information by the
respondents or other interested parties and is aware of no other
independent sources of information that would enable us to further
corroborate the margin calculations in the petition. Specifically, we
attempted to locate both home market prices through publicly available
sources and U.S. producer costs upon which CV was
[[Page 19513]]
based, but we were unable to do so. See the Corroboration Memo.
It is worth noting that the implementing regulation for section 776
of the Act states, ``(t)he fact that corroboration may not be
practicable in a given circumstance will not prevent the Secretary from
applying an adverse inference as appropriate and using secondary
information in question. `` See 19 CFR 351.308(d). Additionally, the
SAA at 870 specifically states that where ``corroboration may not be
practicable in a given circumstance,'' the Department need not prove
that the facts available are the best alternative information.
Therefore, based on our efforts, described above, to corroborate
information contained in the petition, and in accordance with 776(c) of
the Act, we consider the margins in the petition to be corroborated to
the extent practicable for purposes of this final determination. See
the Corroboration Memo.
Accordingly, in selecting AFA with respect to Denki Kagaku, Japan
VAM & POVAL, Kuraray, and Nippon Gohsei, we have applied the margin
rate of 144.16 percent, which is the highest estimated dumping margin
set forth in the notice of initiation. See the Initiation Notice, 67 FR
at 61593.
All Others
Section 735(c)(5)(B) of the Act provides that, where the estimated
weighted-average dumping margins established for all exporters and
producers individually investigated are zero or de minimis, or are
determined entirely under section 776 of the Act, the Department may
use any reasonable method to establish the estimated ``All Others''
rate for exporters and producers not individually investigated. This
provision contemplates that we weight-average margins other than zero,
de minimis, and FA margins to establish the ``All Others'' rate. Where
the data do not permit weight-averaging such rates, the SAA provides
that we may use other reasonable methods. See SAA at 873. Because the
petition contained four estimated dumping margins, we have used these
four estimated dumping margins, as adjusted per the notice of
initiation, to create an ``All Others'' rate based on a simple average.
Therefore, we have calculated the margin of 76.78 percent as the ``All
Others'' rate. See, e.g., Notice of Final Determination of Sales at
Less Than Fair Value and Final Affirmative Finding of Critical
Circumstances: Elastic Rubber Tape from India, 64 FR 19123, 19124 (Apr.
19, 1999).
Analysis of Comments Received
We received no comments from interested parties in response to our
preliminary determination. We did not hold a hearing because none was
requested.
Continuation of Suspension of Liquidation
In accordance with section 735(c)(1)(B) of the Act, we are
directing the Customs Service to continue to suspend all entries of PVA
from Japan, that are entered, or withdrawn from warehouse, for
consumption on or after February 20, 2003, the date of publication of
our preliminary determination. The Customs Service shall continue to
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:
------------------------------------------------------------------------
Margin
Manufacturer/exporter [chyph](percent)
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Denki Kagaku Kogyo Kabushiki Kaisha................... 144.16
Japan VAM & POVAL Co., Ltd............................ 144.16
Kuraray Co., Ltd...................................... 144.16
The Nippon Synthetic [chyph]Chemical Industry Co., 144.16
[chyph]Ltd...........................................
All Others............................................ 76.78
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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 Customs Service 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: April 14, 2003.
Joseph A. Spetrini,
Acting Assistant Secretary for Import Administration.
[FR Doc. 03-9738 Filed 4-18-03; 8:45 am]