[Federal Register Volume 61, Number 200 (Tuesday, October 15, 1996)]
[Notices]
[Pages 53702-53711]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-26358]
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DEPARTMENT OF COMMERCE
[A-570-815]
Sulfanilic Acid From the People's Republic of China; Final
Results and Partial Rescission of Antidumping Duty Administrative
Review
AGENCY: International Trade Administration, Import Administration,
Department of Commerce.
ACTION: Notice of final results and partial rescission of antidumping
duty administrative review.
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SUMMARY: On June 7, 1996, the Department of Commerce (the Department)
published the preliminary results of its administrative review of the
antidumping duty order on sulfanilic acid from the People's Republic of
China (PRC). This review covers the period August 1, 1994 through July
31, 1995.
EFFECTIVE DATE: October 15, 1996.
FOR FURTHER INFORMATION CONTACT: Karin Price or Maureen Flannery,
Import Administration, International Trade Administration, U.S.
Department of Commerce, 14th Street and Constitution Avenue, N.W.,
Washington D.C. 20230; telephone (202) 482-4733.
Applicable Statute
Unless otherwise indicated, all citations to the statute are
references to the provisions effective January 1, 1995, the effective
date of the amendments made to the Tariff Act of 1930 (the Act) by the
Uruguay Round Agreements Act (URAA). In addition, unless otherwise
indicated, all citations to the Department's regulations are to the
current regulations, as amended by the interim regulations published in
the Federal Register on May 11, 1995 (60 FR 25130).
Background
On June 7, 1996, the Department published in the Federal Register
(61 FR 29073) the preliminary results of its administrative review of
the antidumping duty order on sulfanilic acid from the PRC (57 FR
37524, August 19, 1992). We conducted a hearing on July 24, 1996. We
have now completed the administrative review in accordance with section
751 of the Act.
Scope of the Review
Imports covered by this review are all grades of sulfanilic acid,
which include technical (or crude) sulfanilic acid, refined (or
purified) sulfanilic acid and sodium salt of sulfanilic acid.
Sulfanilic acid is a synthetic organic chemical produced from the
direct sulfonation of aniline with sulfuric acid. Sulfanilic acid is
used as a raw material in the production of optical brighteners, food
colors, specialty dyes, and concrete additives. The principal
differences between the grades are the undesirable quantities of
residual aniline and alkali insoluble materials present in the
sulfanilic acid. All grades are available as dry, free flowing powders.
Technical sulfanilic acid contains 96 percent minimum sulfanilic
acid, 1.0 percent maximum aniline, and 1.0 percent maximum alkali
insoluble materials. Refined sulfanilic acid contains 98 percent
minimum sulfanilic acid, 0.5 percent maximum aniline and 0.25 percent
maximum alkali insoluble materials.
Sodium salt is a powder, granular or crystalline material which
contains 75 percent minimum equivalent sulfanilic acid, 0.5 percent
maximum aniline based on the equivalent sulfanilic acid content, and
0.25 percent maximum alkali insoluble materials based on the equivalent
sulfanilic acid content.
This merchandise is classifiable under Harmonized Tariff Schedule
(HTS) subheadings 2921.42.22 and 2921.42.90. Although the HTS
subheadings are provided for convenience and customs purposes, our
written description of the scope of this proceeding is dispositive.
This review covers 13 manufacturers/exporters of sulfanilic acid
from the PRC, and the period August 1, 1994 through July 31, 1995.
[[Page 53703]]
Analysis of Comments Received
We invited interested parties to comment on the preliminary
results. We received written comments from Yude Chemical Industry Co.
(Yude), Zhenxing Chemical Industry Co. (Zhenxing), Sinochem Hebei
Import and Export Corporation (Sinochem Hebei), PHT International, Inc.
(PHT), and New Chemic (U.S.A.), Inc. (New Chemic) (collectively,
respondents); and from the petitioner, Nation Ford Chemical Company. At
the request of PHT and the petitioner, a public hearing was held on
July 24, 1996.
Comment 1
Petitioner argues that, because sales to the United States of
sulfanilic acid produced by Yude and Zhenxing were made by China
National Chemical Construction Corporation (CNCCC), Yude and Zhenxing
are not the proper respondents in this case. Instead, petitioner
contends that CNCCC is the proper respondent.
Petitioner states that, in the preliminary results, the Department
considered sales to PHT, the U.S. importer, of sulfanilic acid produced
by Yude and Zhenxing to be constructed export price (CEP) sales because
PHT is affiliated with Yude and Zhenxing. However, petitioner notes
that Yude and Zhenxing are not related to CNCCC, Yude and Zhenxing sold
the sulfanilic acid to CNCCC, CNCCC exported the sulfanilic acid
produced by Yude and Zhenxing to the United States after purchasing the
sulfanilic acid, and CNCCC, not PHT, paid Yude and Zhenxing for the
sulfanilic acid. As a result, petitioner contends that CNCCC is the
proper respondent in this review with respect to these sales, and that
Yude and Zhenxing are not entitled to a separate margin and should
receive the PRC-wide rate of 85.20 percent. Petitioner further argues
that CNCCC is a named respondent in this review and did not respond to
the questionnaire sent to it by the Department. Accordingly, petitioner
claims that the margin which should be assigned to CNCCC, as the
exporter, should be based on facts available and should be the PRC-wide
rate of 85.20 percent.
Respondents reply that Yude and Zhenxing are the proper respondents
because they set the export price, and these sales were properly
reported and treated as CEP sales. According to respondents, PHT
negotiates the export price with Yude and Zhenxing directly, and CNCCC
simply processes the paperwork. Respondents contrast this situation
with a typical sale involving a PRC trading company, in which the U.S.
importer negotiates the export price with the trading company, not the
factory, and the trading company sources the product from the factory,
even though the U.S. importer often knows of and specifies the factory
in its order. Respondents further note that the invoices to PHT are
from either Yude or Zhenxing, not from CNCCC, and that, prior to the
establishment of the joint ventures, the invoices were from CNCCC.
Respondents cite the Department's proposed regulations, which state
that the Department will normally use the date of invoice as the date
of sale. As a result, respondents argue, since the invoice date
establishes the date of sale, and since invoices are between either
Yude and Zhenxing and PHT or between PHT and its unaffiliated U.S.
customers, the first unrelated U.S. sale is between PHT and its
unrelated U.S. customers, and Yude and Zhenxing are the proper
respondents.
Department's Position
We disagree with petitioner, and have continued to consider these
sales to be CEP sales made by Yude and Zhenxing. We found at
verification that CNCCC's role in the sale of the merchandise to the
United States is limited to processing paperwork, such as packing
lists, and arranging for shipments, and that CNCCC receives a profit
for these activities. We also found that PHT talks to the factories two
or three times each year to negotiate the price between PHT and the
factories, and that the price paid to the factory is fairly constant.
We did find that PHT pays CNCCC, who then pays the factories. However,
payment is made this way because the factories are small and do not
have foreign exchange bank accounts, and the transaction between CNCCC
and the factories is made in renminbi. See page 3 of the May 30, 1996
PHT verification report. Since the price to PHT is determined through
negotiations with Yude and Zhenxing, and CNCCC's role is limited to
processing paperwork, Yude and Zhenxing are the proper respondents in
this review, and we have reviewed PHT's sales to its unaffiliated
customers. As in the preliminary results of review, Yude and Zhenxing
have received a separate rate, and CNCCC has received a rate based on
facts available because it did not respond to the questionnaire.
Comment 2
Petitioner argues that use of Indian import prices of aniline as
the surrogate value for aniline is inappropriate. Petitioner contends
that the domestic market prices of aniline reported in Chemical
Business and Chemical Weekly should be used as surrogate values because
they accurately reflect the prices paid for aniline by Indian
manufacturers of sulfanilic acid. It notes that the import value of
aniline used for the preliminary results of review is less than half
the prices reported in Chemical Business and Chemical Weekly.
Petitioner states that, in selecting surrogate values for a
factors-of-production analysis, the Department attempts to calculate
values for raw materials in a manner which closely approximates the
actual costs of the raw materials paid by manufacturers in the
surrogate country market. As support, petitioner cites to 19 U.S.C.
Sec. 1677b(c), the Final Determination of Sales at Less Than Fair
Value: Coumarin from the People's Republic of China (59 FR 66895,
December 28, 1994) (Coumarin), and the Notice of Final Determination of
Sales at Less Than Fair Value: Saccharin from the People's Republic of
China (59 FR 58818, November 15, 1994) (Saccharin).
Petitioner contends that the data it submitted from Chemical
Business and Chemical Weekly provide the most accurate source of
surrogate values for aniline, and points to the consistency of the data
reported in those publications as an indication of the accuracy and
reliability of that data. It states that the fact that the import value
of aniline is so much lower than the prices reported in Chemical
Business and Chemical Weekly is evidence that the prices in those
publications are more reliable. Petitioner notes that these
publications have been used as sources of surrogate values in other
cases, including the Notice of Final Determination of Sales at Less
Than Fair Value: Sebacic Acid from the People's Republic of China (59
FR 28053, May 31, 1994) (Sebacic Acid) and the Notice of Final
Determination of Sales at Less Than Fair Value: Bicycles from the
People's Republic of China (61 FR 19026, April 30, 1996) (Bicycles),
and were also used to determine surrogate values for sulfuric acid and
activated carbon in the preliminary results of this review. According
to petitioner, it makes no sense for the Department to use Chemical
Business and Chemical Weekly for two surrogate values in this review,
but to reject them for valuing aniline.
Petitioner further argues that there is nothing on the record to
suggest that the PRC producers only use aniline imported into the PRC,
or that Indian manufacturers of sulfanilic acid only use imported
aniline. Without substantial evidence pointing to import values as the
source for the surrogate values, it believes that the Department
[[Page 53704]]
should not rely on the low import values.
Moreover, petitioner contends that the Indian import statistics
used by the Department for the preliminary results reflect the value of
the aniline at the foreign port of export, and, therefore, the cost to
produce aniline in the country of exportation, not India. As a result,
the import statistics do not reflect costs incurred by Indian
sulfanilic acid manufacturers and should be rejected.
Petitioner also claims that reliance on Indian import statistics
assumes that Indian sulfanilic acid producers can purchase aniline in
bulk quantities at low per-unit prices, noting that chemicals such as
aniline are imported in large quantities by Indian importers. By
contrast, Indian sulfanilic acid producers are small operations without
the need or ability to purchase, store, or use large volumes of
aniline, and would pay a higher per-unit cost than do Indian importers
of such chemicals. Petitioner argues that the reported Indian domestic
prices of aniline in Chemical Business and Chemical Weekly reflect the
development of the Indian industry, which is similar to that of the
Chinese industry and consists of smaller facilities without modern,
efficient methods of production.
Petitioner contends that respondents' argument in comments
submitted before the preliminary results that the Department should
disregard the domestic prices of aniline, a petroleum-based product, in
Chemical Business and Chemical Weekly because India is not a petroleum
producing country, resulting in artificially high domestic aniline
prices, is unfounded. Petitioner states that respondents have not
offered support for this claim, and notes that leading aniline
exporters, such as Japan or the Netherlands, do not produce large
amounts of petroleum. Accordingly, petitioner contends that petroleum
production does not determine the price of aniline.
Petitioner further contends that the import prices should not be
used because they cover a period prior to the period of review and do
not include imports during four months of the period of review.
According to petitioner, by contrast, the data provided by petitioner
in Chemical Business and Chemical Weekly cover the entire period of
review.
Lastly, petitioner argues that the Department has considered
whether Indian import statistics merit consideration as surrogate
values in other cases. Petitioner cites specifically to Coumarin, in
which the Department found that Indian import statistics for chlorine
were aberrational because they varied sharply from ``numerous examples
of alternative price sources,'' and therefore did not use the import
values for chlorine. Instead, the Department used non-publicly
available price quotes supplied by the petitioner. Petitioner also
notes that counsel for respondents has argued in other cases that
import values were aberrational and should not be used as surrogate
values, citing to the Final Determination of Sales at Less Than Fair
Value: Sulfur Dyes, Including Sulfur Vat Dyes, from the People's
Republic of China (58 FR 7537, February 8, 1993), and Saccharin.
Petitioner contends that the situation in this case is no different,
because a number of sources of information on the record of this review
indicate that the value of aniline is at least two times greater than
the import value used by the Department in the preliminary results of
review.
Respondents contend that the Department should continue to use
import prices for valuing aniline, as was done in the less-than-fair-
value (LTFV) investigation of this case (see Final Determination of
Sales at Less Than Fair Value: Sulfanilic Acid from the People's
Republic of China (57 FR 29705, July 6, 1992) (Sulfanilic Acid)). They
state that the Department's primary objective in a review is to
calculate antidumping margins as accurately as possible for the PRC
producers/exporters, citing the Final Determinations of Sales at Less
Than Fair Value: Oscillating Fans and Ceiling Fans from the People's
Republic of China (56 FR 55271, October 25, 1991) (Fans). To do so, the
Department must determine the actual cost of aniline for an Indian
manufacturer that produces sulfanilic acid for export. They state that
the evidence on the record of this review shows that Indian sulfanilic
acid producers use imported aniline to produce sulfanilic acid for
export. They note that they have submitted to the record a letter from
an Indian sulfanilic acid producer stating that it uses imported
aniline to produce sulfanilic acid for export, a letter from an Indian
sulfanilic acid exporter describing in detail how an Indian producer
uses imported aniline for export without paying import duties, and a
letter from a sulfanilic acid end user stating that Indian sulfanilic
acid producers could not use domestic aniline to produce sulfanilic
acid for export because their prices would not be competitive. They
contend that since there is no publicly available published information
regarding the source of aniline for Indian sulfanilic acid producers,
the Department must rely on this next best information to show that
imported aniline is used by Indian sulfanilic acid producers. They
further note that there is nothing on the record showing that Indian
manufacturers use domestically-produced aniline to produce sulfanilic
acid for export.
According to respondents, the domestic Indian aniline market is
inefficient and protected by high tariffs. Therefore, respondents
argue, Indian-produced aniline is very expensive, and the Indian
government allows aniline to be imported duty free for production of
sulfanilic acid for export. Respondents contend that petitioner fails
to take into account that Indian sulfanilic acid producers use
different aniline inputs for producing sulfanilic acid for the domestic
and export markets. Respondents state that, while the prices reported
in Chemical Business and Chemical Weekly may reflect the cost of
domestically-produced aniline, they do not reflect the cost of imported
aniline used to produce sulfanilic acid for export and should therefore
be rejected in favor of import prices.
They further claim that the Indian import prices are not
aberrational, stating that they are close to the world market price and
have remained relatively steady during the period of review. They argue
that the fact that the import prices are very stable reflects a
consistency in grade, type, and quality of the aniline imported into
India. Lastly, respondents note that the Department is not required to
choose one source of surrogate information to value all factors in the
face of evidence that it will lead to inaccurate results, and that the
Department has access to Indian import statistics covering the entire
period of review.
Department's Position
We disagree with petitioner. The evidence placed on the record of
this review by the respondents indicates that Indian sulfanilic acid
producers use imported aniline in their production process when they
produce sulfanilic acid for export (see Appendix 2B of respondents'
April 11, 1996 submission). Therefore, these values best approximate
the cost paid by the sulfanilic acid exporters in India, and we have
continued to use import prices reported in the Monthly Statistics of
the Foreign Trade of India, Volume II--Imports (Indian Import
Statistics) to value aniline for the final results of review, as in the
LTFV investigation of this case (see our response to Comment 1 in
Sulfanilic Acid). For the final results of review, we have used import
statistics for the months of the period of review which were
unavailable at the
[[Page 53705]]
time of the preliminary results of review.
With regard to petitioner's argument that the import statistics
reflect the value at the port of export, we note that the introductory
comments to the Indian Import Statistics state that the values are
reported on a CIF (cost, insurance, freight) basis (see our response to
Comment 3). Therefore, we disagree with petitioner that the import
values are inappropriate because they reflect only the cost to produce
in the country of exportation.
Contrary to petitioner's argument that it does not make sense to
reject Chemical Business and Chemical Weekly for aniline but to use
them for other factors, we believe that we can use different sources
for valuing different factors when we find that the surrogate values
are appropriate. Therefore, it is not inappropriate to use the Indian
Import Statistics to value aniline and to use Chemical Business and
Chemical Weekly to value other factors.
Comment 3
Petitioner argues that, if the Department continues to use import
prices as the surrogate value for aniline, the import prices should be
adjusted to account for ocean freight from the port of export to India,
Indian port terminal and brokerage charges, the Indian importers' mark-
up, and the Indian import duty, in order to approximate costs incurred
by Indian sulfanilic acid producers. Petitioner contends that the
aniline import values relied upon by the Department in the preliminary
results are FOB values at the foreign port of export, and, therefore,
do not include such costs. Petitioner states that the ultimate
purchaser of the aniline, the Indian sulfanilic acid producer, would
clearly be charged these expenses, and that an upward adjustment is
necessary to reflect the total cost of the aniline. Petitioner contends
that even the respondents have acknowledged the fact that the import
values should be adjusted upwards, citing the letter from a sulfanilic
acid end user, submitted by respondents, in which the end user stated
that when determining an appropriate delivered price to a sulfanilic
acid producer in India, one must ``add typical ocean freight and
delivery charges.'' Petitioner suggests that the profit margin reported
to the Department by PHT be used to make the adjustment for the
importer's markup.
With regard to import duties, petitioner states that aniline
imported into India during the period of review was subject to an ad
valorem duty of 85 percent which was not added to the surrogate value
for aniline in the preliminary results of this review. According to
petitioner, the letter from the sulfanilic acid exporter provided by
the respondents, which states that import duties on aniline are not
collected when the sulfanilic acid is exported, does not demonstrate
that this 85 percent duty should not be included in the surrogate
value. Petitioner notes that the Department has previously concluded
that the import duty exemption for aniline was a countervailable
subsidy under the U.S. law, citing the Preliminary Affirmative
Countervailing Duty Determination: Sulfanilic Acid from India (57 FR
35784, August 11, 1992), and argues that the alleged forgiveness of
import duties, a countervailable subsidy, does not warrant the
disregarding of the import duty in the factors-of-production analysis.
Respondents reply that the Department should not make any
adjustments to the import value of aniline. They state that, in
previous cases, such as Sebacic Acid, Saccharin, and the Notice of
Final Determination of Sales at Less Than Fair Value; Polyvinyl Alcohol
from the People's Republic of China (61 FR 14057, March 29, 1996)
(Polyvinyl Alcohol), the Department has eliminated from the surrogate
values excise taxes, freight, and all other charges associated with the
surrogate values because the Department already adds amounts for
freight charges and other markups. Respondents note that, in this
review, the Department has added to the surrogate value for aniline
freight costs for transporting the aniline from the supplier in the PRC
to the sulfanilic acid factory and PRC brokerage and handling costs.
Therefore, respondents contend, the petitioner is arguing that the
Department double count such expenses.
Respondents also state that they have submitted evidence to the
record of this review showing that, pursuant to the Indian government's
duty drawback program, Indian importers of aniline import the chemical
duty free and export the sulfanilic acid without the payment of the
import duty. Therefore, the import duty would not be included in the
cost of the aniline to the sulfanilic acid producer.
Respondents further argue that the Department should not add to the
surrogate value for aniline an amount for the importer's markup. First,
respondents state that the petitioner has not submitted any evidence as
to what the importer's markup would be for aniline. Further, since the
surrogate value should be as close as possible to the price at the
factory gate and the import value of aniline represents the closest
approximation of the actual aniline cost to the Indian manufacturer, it
should not include any upward adjustments after importation which would
artificially inflate the aniline cost.
Department's Position
We agree with petitioner that, in order for the surrogate values to
reflect the true costs to India for the raw materials, the surrogate
values should include freight to India. However, the introductory notes
to the Indian Import Statistics, used to determine the surrogate value
for aniline, state that the values reported are reported on a CIF
basis. Thus, the reported import values include the costs of
transporting the merchandise to India, and an adjustment for ocean
freight from the port of export to India and for Indian port terminal
and brokerage charges is not necessary. This does not double count
freight charges, as argued by respondents. We add freight costs to the
cost of manufacturing to account for costs for transporting the raw
materials from the suppliers of the raw materials to the factory
producing the subject merchandise, not freight to the surrogate
country.
We also disagree that we should add an importer's markup to the
surrogate value. There is no evidence on the record of the review
indicating who imports the aniline, the sulfanilic acid producer or an
importer who sells the aniline to the sulfanilic acid producer.
Accordingly, there is no basis for determining that an importer's
markup would be included in the price to the Indian sulfanilic acid
producer and for adjusting the surrogate value for such a markup.
With respect to petitioner's argument that we should include an
amount for import duties in the surrogate value for aniline, we note
that respondents have placed on the record evidence showing that the
import duty is not paid when the sulfanilic acid is exported.
Therefore, we disagree with petitioner, and have not made an adjustment
for import duties.
Comment 4
Petitioner argues that the Department should deduct commissions
paid by PHT from the U.S. starting price. Respondents reply that, if
the Department decides to make an adjustment for commissions, it should
only make the adjustment to those sales for which a commission expense
was incurred, as verified by the Department.
[[Page 53706]]
Department's Position
We agree with petitioner that such commissions should be deducted
in calculating CEP. However, as noted in the May 30, 1996 analysis
memorandum, commissions have already been deducted. The commission
amounts deducted were the verified amounts.
Comment 5
Petitioner argues that, if CNCCC is not treated as the respondent,
then the Department should deduct from the U.S. starting price the
profit earned by CNCCC for these sales. Petitioner contends that this
profit is a commission earned for export services rendered and would be
paid by Yude, Zhenxing, and PHT.
Department's Position
We agree with petitioner. The amount paid to CNCCC for processing
paperwork on each sale was paid by PHT and is directly related to each
sale. Therefore, this amount should be deducted in the calculation of
CEP.
Comment 6
Petitioner argues that the Department should use facts available to
value sales it claims that the Department was unable to verify.
Petitioner cites to the PHT verification report to show that the
Department found at verification a pattern of inconsistencies in PHT's
monthly sales account balances between April and September 1995.
Specifically, petitioner notes that PHT was unable to account for the
difference between the ending sales account balance for June and the
beginning sales account balance for July. According to petitioner, the
lack of documentation and internal control calls into question the
integrity of the reported June and July sales information. As a result,
petitioner argues that the Department could not verify the June and
July sales and should use facts available for any sales made by PHT in
June and July 1995. As facts available, petitioner suggests the highest
margin calculated for any sale made by PHT which the Department was
able to verify.
Respondents reply that the September 1995 ending balance in PHT's
sales account matches the total sales revenue amount reported on PHT's
end-of-year financial statement and tax return. Further they note that,
at verification, PHT informed the Department that the reason for any
differences between the ending balance in the sales account for one
month and the beginning balance for the next month is due to manual
adjustments made at the end of each month to account for errors. They
further state that there is no indication that the relatively small
amount of the difference between the June ending balance and the July
beginning balance has anything to do with sulfanilic acid. Moreover,
respondents state that the PHT verification report indicates that the
Department was able to verify that all sales of sulfanilic acid during
the period of review had been reported.
Department's Position
We disagree with petitioner. At verification, we were unable to use
PHT's sales account (i.e., PHT's accounting system used to prepare its
financial statements) to determine whether all sales of sulfanilic acid
had been reported. However, we were able to review internal worksheets
kept by PHT in the ordinary course of business listing all sales of all
products. These worksheets tied to PHT's financial statements and tax
returns. From these worksheets, we were able to determine that all
sales of sulfanilic acid made by PHT during the period of review had
been reported. See page 5 of the PHT verification report. As we are
satisfied that all sales were reported, we have not used facts
available for PHT's June and July sales.
Comment 7
Respondents argue that the Department should exclude from the U.S.
sales database certain sales made by PHT to the petitioner because,
they claim, the Department has ``no jurisdiction'' over these sales.
Respondents state that, on May 2, 1996, they submitted to the
Department documents establishing that these sales should be excluded
from the analysis. However, the Department returned the submission on
May 20, 1996 stating that, because the documents were submitted after
verification, it could not accept them.
Petitioner responds that PHT's sales to the petitioner were
reported by the respondents, were verified by the Department, and
should not be excluded from the analysis. Petitioner argues that the
respondents' arguments are based entirely on their May 2, 1996
submission, which petitioner believes did not raise any jurisdictional
issues or provide any reasons for disregarding these sales. Moreover,
petitioner argues that this submission was submitted to the Department
after verification and after the deadline for submission of factual
information set forth in section 353.31 of the Department's
regulations, and was therefore returned by the Department. It notes
that the Department stated in its letter returning the submission that
it would not consider the information in its preliminary or final
results of review. According to petitioner, respondents never disputed
the fact that the submission was untimely, and, without this
submission, there is no support for respondents' ``jurisdictional''
argument.
Department's Position
We disagree with respondents. On May 2, 1996, Yude and Zhenxing
submitted new information which we returned as untimely filed. As
stated in our May 20, 1996 letter, we had not requested such
information, and the information was submitted after the deadline for
submission of factual information provided in section 353.31(a)(11) of
our regulations. We also stated that this information was submitted
after the verification which took place at PHT. At verification, we
verified PHT's sales to petitioner, and found nothing which would
indicate that these sales were not properly included in the analysis.
Respondents' claim that the information contained in its May 2,
1996 submission raised a ``jurisdictional'' issue is unfounded. Because
Yude and Zhenxing made undisputed sales to the United States during the
period of review, they are parties subject to this review, and we may
examine or, for proper cause supported by information on the record,
decline to examine all of their sales of subject merchandise during the
period of review, whether to the United States, in the home market, or
to third countries. We do not need to demonstrate ``jurisdiction'' on a
sale-by-sale basis. Yude's and Zhenxing's objection to our analysis of
the sales at issue, therefore, raises no ``jurisdictional'' issue. It
is simply a challenge to our selection of sales for the U.S. database,
which we need not address on its merits because it was raised after the
deadline for submitting new factual information and because the alleged
facts upon which it is based can no longer be verified. Accordingly, we
have included these sales in our analysis.
Comment 8
Respondents argue that the Department should extend the deadline
for allowing Sinochem Hebei to submit its questionnaire response and
should accept Sinochem Hebei's questionnaire response. Respondents cite
as support Bowe-Passat v. United States, 17 CIT 335, 1993 WL 179269
(1993), in which the Court of International Trade (CIT) stated that the
Department routinely accepts data after the deadlines and found that
the Department acted
[[Page 53707]]
arbitrarily and capriciously in rejecting plaintiff's submission of
facts.
Respondents contend that the facts of this case are unique.
Respondents state that the previous administrative review, covering the
period August 1, 1993 through July 31, 1994 (93/94 review), was
initiated in September 1994, and that verification of that review was
conducted during May and July 1995. Respondents note that they were
informed that the preliminary results of the 93/94 review were
scheduled to be issued in August 1995, but that the results were not
issued until May 1996, despite letters and phone calls by counsel for
respondents and the Embassy of the PRC. In the preliminary results of
the 93/94 review, published on May 20, 1996, Sinochem Hebei received a
margin of 2.01 percent.
Respondents continue that the Department conducted verification of
the current review in April 1996, before the verification reports from
the 93/94 review were issued. In the current review, Sinochem Hebei
received an 85.20 percent margin for failing to respond to the
questionnaire. Respondents submit that Sinochem Hebei would have
responded to the Department's questionnaire in the current review
within the time frame specified in the questionnaire had it known its
preliminary margin from the 93/94 review at the time its response in
the current review was due.
Respondents note that, while the margin is assigned to the
exporter, Sinochem Hebei, the U.S. importer is the party which must
bear the consequences as a result of the retroactive nature of the
antidumping review process. They contend that New Chemic, an importer
of subject merchandise from Sinochem Hebei during this period of
review, would be ``wiped out'' as a result of this retroactive duty.
Respondents state that the purpose of the antidumping law is to
determine margins as accurately as possible, in accordance with the
goals of fairness, accuracy, and predictability, citing to Fans, 56 FR
at 55275 (Comment 1). They argue that the failure of the Department to
issue the preliminary results of the 93/94 review in a timely manner
unnecessarily penalizes the U.S. importer, does not serve the purpose
of the antidumping duty law, and is contrary to the intent of the U.S.
Congress in protecting the U.S. industry. They further claim that
denying New Chemic the right to have Sinochem Hebei's response
considered by the Department would unfairly and unjustly destroy a
small business because of the Department's delay in issuing the
preliminary results of the 93/94 review.
Petitioner responds that the Department cannot accept Sinochem
Hebei's questionnaire response after verification and after publication
of the preliminary results of review. Petitioner states that Sinochem
Hebei, as a named respondent, was sent a questionnaire by the
Department on October 6, 1995 and was represented by counsel. Sinochem
Hebei disregarded the deadlines for responding to the questionnaire,
and its counsel withdrew its appearance on behalf of Sinochem Hebei.
Petitioner notes that the Department assigned to Sinochem Hebei the
PRC-wide rate of 85.20 percent in the preliminary results because it
did not respond to the questionnaire. Petitioner further notes that
Sinochem Hebei's questionnaire response was submitted to the Department
several weeks after the preliminary results of the review had been
published, and contends that the Department cannot allow respondents to
dictate how and when they should respond to questionnaires.
According to petitioner, respondents' argument that Sinochem Hebei
would have responded to the questionnaire had it known the adverse
consequences for not doing so is unavailing. Petitioner notes that
Sinochem Hebei had counsel which knew that failure to submit timely
requests for information can lead to adverse consequences in the form
of facts available, and that the questionnaire sent to Sinochem Hebei
stated this.
Department's Position
We disagree with respondents. In this administrative review,
Sinochem Hebei was originally represented by U.S. counsel and actively
requested an administrative review of its own sales. We note that
petitioner also requested a review of Sinochem Hebei's sales.
Accordingly, on October 6, 1995, we sent a questionnaire to Sinochem
Hebei. Sinochem Hebei was required to respond to the questionnaire by
the applicable due dates, which were October 27, 1995 for Section A of
the questionnaire and November 20, 1995 for Sections C and D of the
questionnaire. Sinochem Hebei did not submit a questionnaire response
or request an extension of time for filing its questionnaire response
by these deadlines pursuant to section 353.31(b)(3) of our regulations,
and Sinochem Hebei's counsel withdrew its representation of Sinochem
Hebei on November 29, 1995, after the due dates for Sinochem Hebei's
questionnaire responses. Section 776(a)(2)(B) of the Act provides that
if an interested party fails to provide necessary information by the
deadline for submission, the Department shall use the facts available
in reaching the applicable determination. The fact that the results of
the 93/94 review of this case were not yet issued did not relieve
Sinochem Hebei of its legal responsibility to respond to the
Department's questionnaire for the current review period as requested
by the Department. Each antidumping review is a separate proceeding
covering merchandise entering the United States during a specific time
period, and the facts of each review are considered separately based on
information submitted for that proceeding. Therefore, in the
preliminary results of this review, we correctly assigned a margin to
Sinochem Hebei based on facts available.
We note that New Chemic requested on June 19, 1996, more than seven
months after Sinochem Hebei's questionnaire response was due, that we
extend the deadline for accepting Sinochem Hebei's questionnaire
response. We also note that Sinochem Hebei submitted a questionnaire
response on June 28, 1996, after the preliminary results of this review
were published, and that we returned this response on July 23, 1996. We
cannot extend Sinochem Hebei's time to respond to the questionnaire.
Our regulations require that Sinochem Hebei submit any request for
extension in writing before the time limit for submitting the
information expires (see section 353.31(b)(3)). Therefore, the request
for extension was untimely, and, further, it was not submitted by
Sinochem Hebei. Moreover, section 353.31(a)(ii) of our regulations
states that submissions of factual information are to be submitted not
later than the earlier of the date of publication of the notice of
preliminary results or 180 days after the publication of the notice of
initiation of the review. The preliminary results of this
administrative review were published in the Federal Register on June 7,
1996, and the notice of initiation was published on September 15, 1995.
Therefore, the questionnaire response was untimely and was correctly
rejected.
We also note that Sinochem Hebei was involved in the LTFV
investigation of this case and in the 93/94 review, and, in both of
those proceedings, responded to the Department's requests for
information. Further, in both of those proceedings, we verified the
reported information at Sinochem Hebei's facilities in the PRC.
Therefore, Sinochem Hebei was not unfamiliar with the way in which
antidumping proceedings are conducted, and could
[[Page 53708]]
have consulted either its own counsel or the Department regarding the
consequences of not responding to the questionnaire. The questionnaire
sent to Sinochem Hebei provided the name and telephone number of the
appropriate Department official to contact if it had any questions or
if it was unable to respond to the questionnaire within the specified
time limits. Furthermore, any claims as to what Sinochem Hebei ``would
have done'' had the 93/94 preliminary results been issued prior to the
time its response was due are purely speculative. New Chemic, which was
required to post antidumping duty deposits on imports of the subject
merchandise from the PRC, knew or should have known that these deposits
were not necessarily equivalent to the antidumping rates which will
ultimately be assessed on such entries and should have sought the
cooperation of its supplier at an appropriate stage in the review
process.
As a result, for the final results, we have continued to base
Sinochem Hebei's margin on facts available. As facts available, we have
used the highest rate from any segment of the proceeding, 85.20
percent, the rate from the LTFV investigation of this case.
Comment 9
Respondents contend that, in past cases, the Department has not
deducted indirect selling expenses and profit in the calculation of the
CEP because of the difficulty in isolating expenses used in surrogate
country values. Therefore, such expenses could be double counted. As
support, respondents cite to Fans, in which the Department determined
that there was insufficient information to adjust the surrogate country
expenses; therefore, the Department stated that, for purchase price
sales, it would be unfair to make an upward adjustment to foreign
market value (FMV) for selling expenses incurred on the U.S. sales
without making a downward adjustment to FMV for selling, general, and
administrative (SG&A) expenses, and that, for exporter's sales price
sales, an adjustment for selling expenses should not be made since
these expenses could not be isolated. Respondents also note that the
Department made similar determinations in numerous other cases, such as
the Notice of Final Determination of Sales at Less Than Fair Value:
Pure Magnesium from Ukraine (60 FR 16432, March 30, 1995) and
Saccharin.
Respondents contend that the implementation of the URAA does not
require a change in this policy. They argue that a comparison of the
statute in effect prior to January 1, 1995 and the statute in effect
since that date shows that there has been no significant change in the
law requiring the Department to reconsider its past position. Moreover,
respondents state that Congress' failure to amend the law in this
respect is tantamount to approval, citing United States v. Federal Ins.
Co., 805 F.2d 1012, 1017 (Fed. Cir. 1986), cert. denied, 481 U.S. 1048
(1987).
In addition, respondents argue that the Department provided an
inadequate explanation of its reasons for changing its position in
Bicycles. They state that an analysis of the public record in Bicycles
appears to indicate that the reason for the change is based on a change
in the statutory language. Therefore, respondents claim that, at a
minimum, the Department should provide an extensive analysis to justify
such a change in its longstanding policy.
Petitioner responds that the plain meaning of the law under which
this review is being conducted requires that the Department deduct from
CEP indirect selling expenses and profit, and note that the Department
made the same deductions in Bicycles. It cites to section 772(d)(3) of
the Act to show that the Department must deduct from CEP all selling
expenses, including both direct and indirect selling expenses, and
profit. Petitioner contests respondents' argument that the Department's
deduction of indirect selling expenses and profit was incorrect because
it is inconsistent with practice prior to the 1994 amendments to the
law. It contends that the amended law requires the deduction of
indirect selling expenses and profit from CEP, without exception for
non-market-economy (NME) country cases, and that the Department changed
its practice in order to comply with the provisions of the amended law,
as was done in Bicycles. According to petitioner, the fact that
Congress allegedly failed to expressly reject the Department's prior
practice in this area does not constrain the Department from adopting a
new practice under the changed language of the amended law. Further,
the amended law did make relevant changes in this respect because it
now requires a deduction for indirect selling expenses and for profit,
as is discussed in the Statement of Administrative Action (SAA)
accompanying the URAA (see SAA at 153).
Petitioner further argues that the respondents have not made an
argument that deductions to CEP for direct selling expenses are
improper. According to petitioner, section 772(d)(1) of the Act, which
states that ``any selling expenses'' be deducted, includes both direct
and indirect selling expenses, and it is impossible to interpret the
section as permitting the deduction of some selling expenses but not
others.
Department's Position
We disagree with respondents. As discussed in Bicycles, section
772(c)(2)(d)(1) of the Act states that CEP shall be reduced by the
amount of expenses incurred by or for the account of the producer or
exporter, or the affiliated seller in the United States, in selling the
subject merchandise, and section 772(c)(2)(d)(3) of the Act states that
CEP shall be reduced by the amount of profit allocated to such
expenses. The statute provides no exceptions for NME cases.
Consequently, we have continued to deduct from CEP all selling
expenses, including indirect selling expenses, and CEP profit, as we
did in Bicycles. We note that we have been following this practice in
recent cases (see, e.g., Notice of Preliminary Determination of Sales
at Less Than Fair Value and Postponement of Final Determination:
Melamine Institutional Dinnerware Products from the People's Republic
of China (61 FR 43337, August 22, 1996)).
Comment 10
Respondents contend that, if the Department persists in making
circumstance-of-sale adjustments to U.S. price for direct selling
expenses, then it should make a similar adjustment to normal value
(NV), which is authorized by section 773(a)(6)(C)(iii) of the Act.
Failure to do so, according to respondents, results in inherently
unfair results. Respondents argue that the data from the Reserve Bank
of India Bulletin used for the preliminary results of this review to
determine surrogate values for factory overhead, SG&A expenses, and
profit can be used to calculate the adjustments necessary to NV for
direct selling expenses, such as commissions, advertising, and credit.
Petitioner responds that there is nothing in the SAA or in Bicycles
which states that circumstance-of-sale adjustments to NV are required
by deductions made to CEP. Petitioner further argues that the
respondents incorrectly cite to section 773(a)(6)(C)(iii) of the Act
for authority for the circumstance-of-sale adjustment. According to
petitioner, that section of the Act is superseded by the statutory
provisions relevant to this review, i.e., the NME country provisions
provided for by section 773(c) of the Act. Petitioner states that
application of section 773(c) of the Act is premised on a finding that
a determination under section 773(a) of the Act regarding NV
[[Page 53709]]
is not appropriate, and that a circumstance-of-sale adjustment pursuant
to section 773(a) of the Act therefore must be rejected.
Petitioner states that if the Department makes a circumstance-of-
sale adjustment as requested by respondents, it cannot accept
respondents' calculation of the adjustment for credit and should not
make a reduction to NV for this expense. Petitioner contends that the
expense cited to by respondents as a credit expense is really an
interest expense, which is a general and administrative expense, not a
selling expense.
Department's Position
We do not believe that circumstance-of-sale adjustments to NV are
either necessarily required by the statute or by the existence of
deductions made to CEP. As discussed in Bicycles, section 773(a)(6)(C)
of the Act allows NV to be increased or decreased for differences in
circumstances of sale as long as it has been established to the
satisfaction of the administering authority that such adjustments are
warranted.
In this case, we do not have enough information about the selling
expenses included in the surrogate SG&A expenses to make such an
adjustment to NV or to determine whether such an adjustment is
warranted. Therefore, for the final results, we have not made such an
adjustment to NV.
Comment 11
Respondents argue that, in contrast to the situation with respect
to aniline, there is no evidence on the record of this review which
indicates that Indian sulfanilic acid producers use imported activated
carbon to produce sulfanilic acid for export. They believe that it
makes sense that Indian sulfanilic acid producers would use
domestically-produced activated carbon, which is substantially cheaper
than imported activated carbon. Respondents thus argue that the
Department should use as the surrogate value the export price of
activated carbon reported in Chemical Weekly, which they submitted to
the Department before the preliminary results of review were issued,
because it reflects the actual price in the Indian market used to
produce sulfanilic acid for export. As support for their argument, they
cite to section 773(c)(1) of the Act, which requires the Department to
use the best available information for valuing the factors of
production in the surrogate country (emphasis added).
Respondents also note that in Polyvinyl Alcohol, the Department
rejected the very same import price for activated carbon in favor of
the export price reported in Chemical Weekly.
Further, respondents contend that the Department did not take into
consideration the quality of the activated carbon used by respondents
or the quality of the activated carbon imported into India. Respondents
state that the Kirk-Othmer Encyclopedia of Chemical Technology
designates activated carbon as either gas-phase or liquid-phase
absorbents. Respondents argue that, even though the data are old,
activated carbon prices from 1976 quoted in that publication indicate
that gas-phase activated carbon is more expensive than liquid-phase
activated carbon. According to respondents, the factories use liquid-
phase activated carbon, as is shown by the production process described
in their questionnaire response, whereas the price level of the
imported activated carbon indicates that the imports were of the gas-
phase activated carbon or specialty grades unsuitable for sulfanilic
acid production. Therefore, respondents argue that the Department
should determine the types of activated carbon represented by the
import figures and decide whether it is appropriate to value
respondents' activated carbon with those import prices.
Lastly, they claim that the quantities of imported activated carbon
are inadequate for valuing the factories' factors of production because
they are much smaller than the quantities used by the factories and
purchases by the respondents would be in large quantities which would
merit discounts not reflected by these import prices. Respondents
further claim that the small quantities are a further indication that
the imports are of the more expensive gas-phase activated carbon or are
of specialty grades which are not suitable for the production of
sulfanilic acid.
Petitioner responds that the Department properly based the
surrogate value on the prices reported in Chemical Weekly during March
and May 1995, the only publicly available data on the record covering
this period of review. It notes that the price which the respondents
urge the Department to use is from a September 1993 issue of Chemical
Weekly, nearly one year before the beginning of the period of review.
According to petitioner, respondents' argument regarding the valuation
of activated carbon is fundamentally at odds with its argument
regarding aniline. It notes that the respondents are arguing that the
Department use import prices for aniline, but that import prices for
activated carbon are aberrational. Petitioner states that, if the
import prices for activated carbon are aberrational, then the
Department should also find that import prices are also aberrational
for aniline.
Petitioner argues that the respondents' submission in its case
brief of information from the Encyclopedia of Chemical Technology is
new factual information which must be rejected and returned to the
respondents, and therefore, their arguments based on information in
this publication should not be considered.
According to petitioner, respondents reliance on Polyvinyl Alcohol
is misplaced. Petitioner notes that, in that case, the Department
compared import and export prices to other price data to determine
which were more reliable. In this proceeding, however, the only
publicly available published information from the period of review is
that from the March and May 1995 issues of Chemical Weekly, and there
is no other data from the period of review with which to compare these
prices.
Moreover, petitioner contends that the volumes of sales used to
determine the surrogate value for the preliminary results are
sufficient for use in determining the surrogate value, and note that
the value supported by the respondents is based on a smaller volume.
Petitioner contends that this weakens respondents' argument that the
export data be used as the surrogate value. Petitioner contends,
however, that the contemporaneity of the data is more important that
the relative volume of the sales in question.
Petitioner lastly contends that the Department should increase the
surrogate value for activated carbon by the amount of the 85 percent
import duty, in order to approximate the true cost of the activated
carbon to the Indian sulfanilic acid manufacturer. It states that
because the activated carbon is not physically incorporated into the
sulfanilic acid, imports of activated carbon would not be eligible for
any import duty exemption upon export of the sulfanilic acid.
Department's Position
We disagree with respondents. There is no evidence on the record of
this review which indicates whether Indian sulfanilic acid producers
use domestic or imported activated carbon to produce sulfanilic acid.
Further, there is no evidence on the record of this review which
indicates whether the prices supported by either the respondents or the
petitioner are for gas-phase or liquid-phase activated carbon. We note
that respondents never stated in their questionnaire responses that
they used
[[Page 53710]]
a certain type of activated carbon in their production, or indicated in
their surrogate value comments that there was more than one type of
activated carbon.
In determining the surrogate value used for activated carbon in the
preliminary results of review, we considered the information placed on
the record by the petitioner and by the respondents. We selected the
data submitted by the petitioner because they are more contemporaneous,
covering imports during the period of review, than those provided by
respondents, which are from a September 1993 issue of Chemical Weekly
and are for an export during June 1993. Moreover, with respect to
respondents' argument that the import prices should not be used because
of the small quantity of imports, we note that the price which
respondents urge us to use is from an export involving an even smaller
quantity. Therefore, for the final results of review, we have continued
to use the import prices reported in Chemical Weekly during the period
of review.
We disagree with petitioner that we should adjust this value for
import duties. We calculate surrogate values used to value raw
materials on a tax-exclusive basis, as we have discussed in previous
cases, such as the Notice of Final Determination of Sales at Less Than
Fair Value: Manganese Metal from the People's Republic of China (60 FR
56045, November 6, 1995) (Manganese Metal). See also our response to
Comment 12 below. Therefore, it is not appropriate to include in the
surrogate values amounts for import duties.
We disagree with petitioner that the information submitted by the
respondents from the Encyclopedia of Chemical Technology constitutes
new information which should be rejected. As the title of the source
indicates, the information cited by the respondents in support of their
argument that the price used in the preliminary results of review to
value activated carbon was incorrect was of a general, definitional
nature.
Comment 12
Respondents argue that the Department should calculate a surrogate
value for sulfuric acid which is exclusive of taxes. Respondents state
that the issues of Chemical Weekly used by the Department in the
preliminary results to value sulfuric acid clearly state that the
sulfuric acid prices contained therein are inclusive of excise and
Maharashtra sales taxes. Respondents argue that the Department has a
long and consistent history in NME country cases of valuing the factors
of production with tax-exclusive prices, citing to Bicycles, Manganese
Metal, and Sebacic Acid. Respondents further cite to Polyvinyl Alcohol,
in which the Department valued sulfuric acid at exactly the same price
from the same source, but adjusted the values to exclude taxes.
Respondents note that they submitted documentation on the relevant tax
rates to the record of this review.
Petitioner responds that the Department should not revise the
surrogate value for sulfuric acid. According to petitioner, there is no
evidence on the record concerning the applicable Indian tax rate for
sulfuric acid, and, without such information, the Department cannot
determine a tax-exclusive price. Petitioner contends that, in Polyvinyl
Alcohol, the respondent was able to specifically identify the
applicable tax rates. Moreover, petitioner argues that the Department
only excludes taxes on raw materials where such taxes are refunded upon
exportation, and that there is no evidence on the record which
indicates whether taxes paid on sulfuric acid are refunded upon
exportation. Petitioner notes that, in Aimcor v. United States, 19 CIT
__, Slip Op. 95-130 (July 20, 1995), (Aimcor), at 22, the CIT stated
that ``material costs, such as value-added taxes must be included in
constructed value if they are incurred prior to exportation, with the
exception of tax remitted or refunded upon exportation.''
Department's Position
We agree with respondents that the surrogate values used to value
the raw materials should be exclusive of taxes, as we have discussed in
previous cases, such as Manganese Metal. The issues of Chemical Weekly,
contained in Attachment 3 of the May 30, 1996 factor value memorandum,
used to determine the surrogate value for sulfuric acid in the
preliminary results of this review, state that the prices reported for
sulfuric acid are inclusive of Excise and Maharashtra taxes.
Accordingly, we have adjusted the surrogate value or sulfuric acid to
exclude taxes for the final results of review. To adjust the prices to
exclude taxes, we have used the Central Excise Tariff of India, 1994-
95, submitted to the record of this review by respondents in their
April 11, 1996 submission and used to determine the tax-exclusive
surrogate value for sulfuric acid in Manganese Metal and Polyvinyl
Alcohol.
We disagree with petitioner that Aimcor is relevant in NME country
cases. Aimcor deals with the construction of NV in market economy cases
pursuant to section 773(e) of the Act, and with material costs incurred
as a result of the taxes levied by the country whose sales of the
subject merchandise to the United States constitute the U.S. price to
which that NV is compared. In this case, by way of contrast, the NV
being calculated (by applying Indian surrogate values to the PRC
factors) is a surrogate for material costs in the PRC for comparison to
the U.S. sales of the Chinese merchandise. Therefore, Indian value-
added taxes, which do not affect PRC sales to the United States, should
be removed from such surrogate costs.
Comment 13
Respondents note that, in determining surrogate values for
overhead, SG&A expenses, and profit, the Department used data contained
in the April 1995 Reserve Bank of India Bulletin. In making its
calculation, respondents argue that the Department arbitrarily and
without explanation allocated 50 percent of the expenses in three
categories, ``provident fund,'' ``salaries, wages and bonuses,'' and
``employees' welfare expenses,'' to SG&A expenses and 50 percent to the
cost of manufacture. As a result, the cost of manufacturing is
understated and the overhead rate, SG&A rate, and profit rate are
overstated. They contend that 100 percent of these three categories
should be applied to the cost of manufacture, as was done in Polyvinyl
Alcohol.
Department's Position
We agree with respondents that 100 percent of these labor
categories should be included in the cost of manufacturing. In the
absence of any information to the contrary, it makes sense that most of
these expenses would be applicable to the cost of manufacturing rather
than to SG&A expenses. In addition, we note that in Polyvinyl Alcohol,
although we did not use information from the Reserve Bank of India
Bulletin as surrogate values for overhead, SG&A expenses, and profit,
we compared values from this source to values from financial statements
from Indian producers; in each instance, we allocated 100 percent of
these labor categories to the cost of manufacturing. We have also
reexamined our classification of other categories in the Reserve Bank
of India Bulletin, and have determined that several cateogries were
misclassified in the preliminary results of review. This has been
corrected for the final results.
Clerical Errors
Respondents contend that the Department made three clerical errors
in
[[Page 53711]]
its preliminary results. First, they state that, in valuing activated
carbon, the Department left out an importation in May 1995. Second,
they argue that, in calculating the cost of packing materials, the
Department used the wrong weights for the bags used to pack the
sulfanilic acid. Third, they state that the Department inaccurately
determined the freight cost for transporting the raw materials between
the supplier factories and the sulfanilic acid factories. We have
reviewed the calculations, and agree that these errors were made. They
have been corrected for the final results.
Non-Shippers
Baoding and Hainan Garden stated that they did not have shipments
during the period of review, and we confirmed this with the United
States Customs Service. Therefore, we are treating them as non-shippers
for this review, and are rescinding this review with respect to these
companies. See 19 CFR Parts 351, 353, and 355 Antidumping Duties;
Countervailing Duties; Proposed Rule, section 351.213(d)(3) (61 FR
7365, February 27, 1996). The cash deposit rates for these firms will
continue to be the rates established in the most recently completed
final determination.
Final Results of Review
As a result of our review of the comments received, we have
determined that the following margins exist:
------------------------------------------------------------------------
Margin
Manufacturer/exporter Time period (percent)
------------------------------------------------------------------------
Yude Chemical Industry Company...... 8/1/94-7/31/95 *16.86
Zhenxing Chemical Industry Company.. 8/1/94-7/31/95 *16.86
PRC Rate \1\........................ 8/1/94-7/31/95 85.20
------------------------------------------------------------------------
* Yude and Zhenxing have been collapsed for the purposes of this
administrative review. However, we have listed them separately on this
chart for Customs purposes.
\1\ This rate will be applied to all firms which have not demonstrated
that they are separate from the PRC government, including, but not
limited to, the following firms for which a review was requested:
China National Chemical Construction Corporation, Beijing Branch;
China National Chemical Construction Corporation, Qingdao Branch;
Jinxing Chemical Factory; Mancheng Xinyu Chemical Factory, Beijing;
Mancheng Xinyu Chemical Factory, Shijiazhuang; Shunping Lile; Sinochem
Hebei Import and Export Corporation; Sinochem Qingdao; and Sinochem
Shandong.
The Department will instruct the Customs Service to assess
antidumping duties on all appropriate entries. The Department will
issue appraisement instructions directly to the Customs Service.
Furthermore, the following deposit requirements will be effective
upon publication of these final results for all shipments of sulfanilic
acid from the PRC entered, or withdrawn from warehouse, for consumption
on or after the publication date, as provided for by section
751(a)(2)(c) of the Act: (1) The cash deposit rates for reviewed
companies named above which have separate rates will be the rates for
those firms listed above; (2) for the companies named above which were
not found to have a separate rate, as well as for all other PRC
exporters, the cash deposit rate will be the highest margin ever in the
LTFV investigation or in this or prior administrative reviews, the PRC-
wide rate; and (3) 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 deposit requirements shall remain in
effect until publication of the final results of the next
administrative review.
This notice also serves as a final reminder to importers of their
responsibility under 19 CFR 353.26 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 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 CR 353.34(d)(1). Timely written notification
of the return/destruction of APO materials or conversion to judicial
protective order is hereby requested. Failure to comply with the
regulations and terms of an APO is a sanctionable violation.
This administrative review and notice are in accordance with
section 751(a)(1) of the Act (19 U.S.C. 1675(a)(1)) and 19 CFR 353.22.
Dated: October 7, 1996.
Robert S. LaRussa,
Acting Assistant Secretary for Import Administration.
[FR Doc. 96-26358 Filed 10-11-96; 8:45 am]
BILLING CODE 3510-DS-P