[Federal Register: May 20, 2003 (Volume 68, Number 97)]
[Notices]               
[Page 27530-27533]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr20my03-44]                         

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DEPARTMENT OF COMMERCE

International Trade Administration

[A-570-878]

 
Notice of Final Determination of Sales at Less Than Fair Value: 
Saccharin From the People's Republic of China

AGENCY: Import Administration, International Trade Administration, 
Department of Commerce.

EFFECTIVE DATE: May 20, 2003.

FOR FURTHER INFORMATION CONTACT: Mark Hoadley (Suzhou Fine Chemicals 
Group Co., Ltd.) at (202) 482-3148, Javier Barrientos or Jessica 
Burdick (Shanghai Fortune Chemical Co., Ltd.) at (202) 482-2243 or 
(202) 482-0666, or Sally C. Gannon at (202) 482-0162; Office of AD/CVD 
Enforcement VII, 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 saccharin 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 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 published 
on December 27, 2002. See Notice of Preliminary Determination of Sales 
at Less Than Fair Value: Saccharin From the People's Republic of China, 
67 FR 79049 (December 27, 2002) (Preliminary Determination). Since the 
issuance of the preliminary determination, the following events have 
occurred.
    On January 8, 2003, petitioner, PMC Specialities Group Inc., 
requested a hearing. On January 8, 2003, the Department received a 
timely factor value submission from Shanghai Fortune Chemical Co. 
(Shanghai Fortune) and Suzhou Fine Chemicals Group Co., Ltd. (Suzhou) 
(collectively, ``respondents'') and Kaifeng Xinghua Fine Chemical 
Factory (Kaifeng). On February 11, 2003, the Department extended the 
due date for the final determination of this investigation (68 FR 
6885). On February 21, 2003, the Department received timely factor 
value submissions from petitioner, respondents and Kaifeng, and Procter 
& Gamble Co. On March 3, 2003, the Department received a supplemental 
factor value submission from petitioner. On April 10, 2003, the 
Department received timely written case briefs from petitioner, 
respondents, Procter & Gamble Co., and Colgate Palmolive Co. On April 
15, 2003, the Department received timely rebuttal comments from 
petitioner and respondents. On April 22, 2003, a public hearing was 
held in this proceeding. We have now completed this investigation in 
accordance with section 735 of the Act.

Scope of the Investigation

    The product covered by this investigation is saccharin. Saccharin 
is defined as a non-nutritive sweetener used in beverages and foods, 
personal care products such as toothpaste, table top sweeteners, and 
animal feeds. It is also used in metalworking fluids. There are four 
primary chemical compositions of saccharin: (1) sodium saccharin 
(American Chemical Society Chemical Abstract Service (CAS) Registry 
128-44-9); (2) calcium saccharin (CAS Registry 6485-
34-3); (3) acid (or insoluble) saccharin (CAS Registry 81-07-
2); and (4) research grade saccharin. Most of the U.S.-produced and 
imported grades of saccharin from the PRC are sodium and calcium 
saccharin, which are available in granular, powder, spray-dried powder, 
and liquid forms.
    The merchandise subject to this investigation is classifiable under 
subheading 2925.11.00 of the Harmonized Tariff Schedule of the United 
States (HTSUS) and includes all types of saccharin imported under this 
HTSUS subheading, including research and specialized grades. Although 
the HTSUS subheading is provided for convenience and Customs (as of 
March 1, 2003, renamed the U.S. Bureau of Customs and Border 
Protection) purposes, the Department's written description of the scope 
of this investigation remains dispositive.

Period of Investigation

    The period of investigation (POI) is January 1, 2002 through June 
30, 2002. This period corresponds to the two most recent fiscal 
quarters prior to the month of the filing of the Petition (i.e., July 
2002), and is in accordance with our regulations. See 19 CFR 
351.204(b)(1).

Analysis of Comments Received

    All issues raised in the case and rebuttal briefs by parties to 
this investigation are addressed in the Issues and Decision Memorandum 
for the Final Determination of the Antidumping Duty Investigation of 
Saccharin from the People's Republic of China, to Joseph A. Spetrini, 
Acting Assistant Secretary for Import Administration, from Barbara E. 
Tillman, Acting Deputy Assistant Secretary for Import Administration, 
dated May 12, 2003 (Decision Memorandum), which is hereby adopted by 
this notice. A list of the issues which parties have raised and to 
which we have responded, all of which are addressed in the Decision 
Memorandum, is attached to this notice as an appendix. Parties can find 
a complete discussion of all issues raised in this review 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.

Non-Market Economy Country Status

    The Department has treated the PRC as a non-market economy (NME) 
country in all past antidumping

[[Page 27531]]

investigations. See, e.g., Notice of Final Determination of Sales at 
Less Than Fair Value: Ferrovanadium from the People's Republic of 
China, 67 FR 71137 (November 29, 2002); Notice of Final Determination 
of Sales at Less Than Fair Value: Cold-Rolled Carbon Steel Flat 
Products from the People's Republic of China, 67 FR 62107 (October 3, 
2002). 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. Therefore, we have continued to treat the PRC as an NME in this 
investigation. For further details, see the Preliminary Determination.

Separate Rates

    In the Preliminary Determination, the Department found that 
respondents and Kaifeng met the criteria for the application of 
separate, company-specific antidumping duty rates. We have not received 
any other information since the Preliminary Determination which would 
warrant reconsideration of our separates rates determination with 
respect to respondents and Kaifeng. For a complete discussion of the 
Department's determination that the respondents and Kaifeng are 
eligible for a separate rate, see the Preliminary Determination.

The PRC-Wide Rate

    In the Preliminary Determination, we found that the use of adverse 
facts available for the PRC-wide rate was appropriate for other 
exporters in the PRC based on our presumption that those companies who 
failed to demonstrate that they met the requirements for a separate 
rate constitute a single enterprise under common control by the Chinese 
government. The PRC-wide rate applies to all entries of the merchandise 
under investigation except for entries from the respondents and 
Kaifeng.
    When analyzing the petition for purposes of the initiation, the 
Department reviewed all of the data upon which the petitioner relied in 
calculating the estimated dumping margin and determined that the margin 
in the petition was appropriately calculated and supported by adequate 
evidence in accordance with the statutory requirements for initiation. 
In order to corroborate the petition margin for purposes of using it as 
adverse facts available, we examined the price and cost information 
provided in the petition in the context of our preliminary 
determination. For further details, see Preliminary Determination of 
Saccharin from the People's Republic of China: Analysis and 
Corroboration of Adverse Facts Available Rate, Memorandum from Mark 
Hoadley, through Sally Gannon, to the File (December 18, 2002). We 
received no comments concerning the Department's calculation of the 
PRC-wide rate; therefore, the Department finds that, for the final 
determination, the rate contained in the petition, recalculated as 
described below, has probative value.
    Since the Preliminary Determination, we have revised several of the 
surrogate values based on Indian import data. In order to take into 
account these values, we have recalculated the petition margin using, 
where possible, the revised surrogate values. As a result of this 
recalculation, the PRC-wide rate, for the final determination, is 
329.33 percent. These revised surrogate values are based on updated 
versions of the same source documentation used in the preliminary 
determination. Therefore, additional corroboration analysis is not 
necessary. See Final Determination of Saccharin from the People's 
Republic of China: Analysis of Adverse Facts Available Rate, Memorandum 
from Mark Hoadley to the File (May 12, 2003).

Margins for Cooperative Exporters Not Selected

    The exporter who responded to Section A of the Department's 
antidumping questionnaire but was not selected as a respondent in this 
investigation, Kaifeng, has applied for a separate rate and provided 
information for the Department to make this determination. Although it 
is not practicable for the Department to calculate a separate rate for 
Kaifeng in addition to Suzhou and Shanghai Fortune (see Respondent 
Selection Memorandum, explaining the Department's decision to limit the 
investigation to two exporters), the company did cooperate in providing 
all information that the Department requested. We received no comments 
concerning the preliminary margin applied to Kaifeng; therefore, for 
the final determination, we have continued to apply to Kaifeng a 
separate rate based on the weighted-average of the rates calculated for 
those exporters that were selected to participate in this 
investigation, excluding any rates that are zero, de minimis, or based 
entirely on adverse facts available. See Notice of Final Determination 
of Sales at Less Than Fair Value; Honey from the People's Republic of 
China, 66 FR 50608, 50609 (October 4, 2001).

Surrogate Country

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

Verification

    As provided in section 782(i) of the Act, we verified the 
information submitted by respondents 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 respondents.

Date of Sale

    In the Preliminary Determination, the Department determined that 
invoice date was the most appropriate date of sale for respondents. 
Normally, the Department presumes that invoice date is the date of 
sale; however, ``[i]f the Department is presented with satisfactory 
evidence that the material terms of sale are finally established on a 
date other than the date of invoice, the Department will use that 
alternative date as the date of sale.'' Antidumping Duties; 
Countervailing Duties: Final Rule, 62 FR 27296, 27349 (May 19, 1997) 
(Preamble). See also 19 CFR 351.401(i). After examining Shanghai 
Fortune's sales documentation at verification, we determine that 
because there were no material changes to the essential terms of sale 
(quantity and price) between the purchase order date and the invoice 
date, purchase order date is the most appropriate date of sale for 
Shanghai Fortune. See Decision Memorandum and Memorandum to the File 
from Javier Barrientos and Jessica Burdick, Case Analysts, through 
Sally Gannon, Program Manager; Antidumping Duty Investigation of 
Saccharin from the People's Republic of China (PRC) (A-570-878): PRC 
Sales Verification Report for Shanghai Fortune Chemical Co., at 5-6 
(March 26, 2003) (Shanghai Fortune Verification Report).
    After examining Suzhou's sales documentation at verification, we 
determine that, for the final determination, invoice date continues to 
be the most appropriate date of sale for Suzhou. Suzhou reported 
purchase order dates and invoice dates as dates of sale. For those 
sales for which it reported invoice date, it did so because material 
sales terms were not set until this date. Given that the Department 
must choose one date of sale for all sales

[[Page 27532]]

in a particular market by a single respondent, we, therefore, are 
choosing invoice date as the date of sale for Suzhou. This choice is 
consistent with our regulatory presumption in favor of invoice date, 
and with the fact that material sales terms sometimes are not set until 
invoice date for this particular exporter.

Fair Value Comparisons

    To determine whether sales of saccharin to the United States by 
Suzhou and Shanghai Fortune were made at LTFV, we compared the export 
price (EP), for Shanghai Fortune, and the constructed export price 
(CEP), for Suzhou, to normal value (NV), as discussed in the Decision 
Memorandum, Final Determination in the Antidumping Duty Investigation 
of Saccharin from the People's Republic of China: Analysis of Suzhou 
Fine Chemicals Group Co., Ltd., from Mark Hoadley, through Sally 
Gannon, to the File (May 12, 2003) (Suzhou Analysis Memorandum), Final 
Determination in the Antidumping Duty Investigation of Saccharin from 
the People's Republic of China: Analysis of Shanghai Fortune Chemical 
Co., Ltd., from Javier Barrientos, through Sally Gannon, to the File 
(May 12, 2003) (Shanghai Fortune Analysis Memorandum), and Antidumping 
Duty Investigation of Saccharin from the People's Republic of China: 
Factor Valuation, Memorandum from Sebastian Wright, Case Analyst, 
through Mark Hoadley, Senior Analyst, Office VII, to the File (May 12, 
2003) (Factor Valuation Memorandum). In accordance with section 
777A(d)(1)(A)(i) of the Act, for Shanghai Fortune, we calculated a 
weighted-average margin based on EP. See also ``Use of Facts Otherwise 
Available'' section of this notice. With regard to Suzhou, in 
accordance with section 777A(d)(1)(A)(ii) of the Act, we calculated a 
weighted-average margin based on CEP.

Use of Facts Otherwise Available

    Section 776(a)(2) of the Act provides that, if an interested party 
withholds information that has been requested by the Department, fails 
to provide such information in a timely manner or in the form or manner 
requested, significantly impedes a proceeding under the antidumping 
statute, or provides information which 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. 
Pursuant to section 782(e), the Department shall not decline to 
consider such information if all of the following requirements are met: 
(1) the information is submitted by the established deadline; (2) the 
information can be verified; (3) the information is not so incomplete 
that it cannot serve as a reliable basis for reaching the applicable 
determination; (4) the interested party has demonstrated that it acted 
to the best of its ability; and (5) the information can be used without 
undue difficulties.
    As discussed above, section 776(a)(2)(A) of the Act requires the 
Department to use facts available when a party withholds information 
which has been required by the Department. On September 10, 2002 and 
again on November 4, 2002, the Department requested that Shanghai 
Fortune report all sales of saccharin to the United States during the 
POI. The Department requested that Shanghai Fortune provide this sales 
information, whether the date of sale was based on purchase order/
contract date or invoice date. On October 25, 2002 and November 25, 
2002, Shanghai Fortune submitted to the Department what it reported to 
be all sales of saccharin sold to the United States during the POI, 
based upon both purchase order/contract date, as well as invoice date. 
After the preliminary determination, but prior to verification, 
Shanghai Fortune had additional opportunities to provide the Department 
with all sales information. At Shanghai Fortune's verification, the 
Department discovered an unreported sale of saccharin to the United 
States during the POI. Therefore, application of facts available is 
appropriate pursuant to 776(a)(2)(A), because Shanghai Fortune withheld 
information the Department requested, namely, one of its sales.
    Once the Department determines that the use of facts available is 
warranted, section 776(b) of the Act further permits the Department to 
apply an adverse inference if it makes the additional finding that ``an 
interested party has failed to cooperate by not acting to the best of 
its ability to comply with a request for information.'' The Department 
finds that Shanghai Fortune's failure to report this sale constitutes a 
failure to cooperate to the best of its ability and that the use of 
adverse facts available is appropriate under section 776(b) for the 
following reasons. The Department requested on two occasions that 
Shanghai Fortune report all of its sales during the POI (first, on the 
basis of what Shanghai Fortune believed to be the date of sale, and, 
second, on the basis of both purchase order/contract date and invoice 
date). In filing its second supplemental, Shanghai Fortune certified 
that it had reported all sales on both a purchase order/contract date 
basis and an invoice date basis. Shanghai Fortune explained at 
verification that it inadvertently failed to report this sale. See 
Shanghai Fortune Verification Report at 10 and 16. For this reason, and 
because it failed to report only this one sale, the Department finds 
that the application of partial, rather than total, adverse facts 
available for the missing POI sale is appropriate in this case. Section 
776(b) of the Act states that adverse facts available may include 
information derived from the petition, the final determination, a 
previous administrative review, or other information placed on the 
record. As adverse facts available, and in accordance with section 
776(b), the Department is applying the highest rate from the petition 
for an export price sale to the quantity of Shanghai Fortune's missing 
sale for the final determination. See Shanghai Fortune Analysis 
Memorandum. As discussed in ``The PRC-Wide Rate'' section of this 
notice, the Department has adjusted the petition rate, and the petition 
rate has been corroborated. Moreover, we determine that the highest 
rate from the petition is relevant to Shanghai Fortune, given that it 
represents a sale of a product also sold by Shanghai Fortune, made on 
the same sales basis (export price) as Shanghai Fortune.

Changes Since the Preliminary Determination

    Based on our findings at verification and on our analysis of the 
comments received, we have made adjustments to the calculation 
methodologies used in the preliminary determination. In particular, we 
have made changes involving the following issues: surrogate valuation, 
concentration strength of inputs, byproduct offset, normal value 
financial ratios, Suzhou USA's indirect selling expenses, and date of 
sale, as well as several miscellaneous calculation issues. These 
changes are discussed in detail in the Decision Memorandum, Suzhou 
Analysis Memorandum, and Shanghai Fortune Analysis Memorandum. In 
addition to the Decision Memorandum, public versions of the Suzhou 
Analysis Memorandum and Shanghai Fortune Analysis Memorandum are on 
file in the Central Records Unit, Room B-099, of the main Commerce 
Building.

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

[[Page 27533]]

saccharin from the PRC that are entered, or withdrawn from warehouse, 
for consumption, on or after December 27, 2003 (the date of publication 
of the Preliminary Determination in the Federal Register). BCBP shall 
continue to require a cash deposit or the posting of a bond equal to 
the weighted-average amount by which the normal value exceeds the U.S. 
price, as indicated in the chart below. The suspension of liquidation 
instructions will remain in effect until further notice. The weighted-
average dumping margins are as follows:

------------------------------------------------------------------------
               Manufacturer/Exporter                   Margin (percent)
------------------------------------------------------------------------
Suzhou Fine Chemical Group Co., Ltd................              291.57%
Shanghai Fortune Chemical Co., Ltd.................              249.39%
Kaifeng Xinhua Fine Chemical Factory...............              281.97%
PRC-Wide...........................................              329.33%
------------------------------------------------------------------------

International Trade Commission Notification

    In accordance with section 735(d) of the Act, we have notified the 
International Trade Commission (ITC) of our determination. The ITC will 
determine, within 45 days, whether these imports are materially 
injuring, or threatening material injury to, an industry in the United 
States. 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 BCBP officials to assess antidumping 
duties on all imports on 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 in accordance with 
sections 733(f) and 777(i)(1) of the Act.

    Dated: May 12, 2003.
Jeffrey May,
Acting Assistant Secretary for Import Administration.

Appendix

Issues in Decision Memorandum

Comment 1: Surrogate Values: Most Appropriate Source for Surrogate 
Values
Comment 2: Surrogate Values: Adjustments to Surrogate Values for 
Concentration Strengths
Comment 3: Surrogate Values: Choice of Surrogate Values for Byproducts
Comment 4: Application of ``Sigma'' Rule
Comment 5: Market Economy Inputs: Valuation of Phthalic Anhydride
Comment 6: Byproduct Offset
Comment 7: Packing Expenses
Comment 8: Suzhou's Self-Produced Inputs
Comment 9: Normal Value Financial Ratios
Comment 10: Suzhou USA's Indirect Selling Expenses
Comment 11: Calculation of Suzhou USA's CEP Profit
Comment 12: Date of Sale
Comment 13: Calculation Issue: Freight
Comment 14: Calculation Issue: Conversion Error/Ice, Water, and Steam
Comment 15: Calculation Issue: Conversion Error/Labor
Comment 16: Calculation Issue: Discrepancy Between Prelim Factor Values 
Memo and Calculations
[FR Doc. 03-12636 Filed 5-19-03; 8:45 am]
BILLING CODE 3510-DS-S