[Federal Register Volume 64, Number 44 (Monday, March 8, 1999)]
[Notices]
[Pages 10983-10985]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-5626]


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DEPARTMENT OF COMMERCE

International Trade Administration
[A-791-802]


Furfuryl Alcohol From the Republic of South Africa; Preliminary 
Results of Antidumping Duty Administrative Review and Intent To Revoke 
Order in Part

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

ACTION: Notice of preliminary results of antidumping duty 
administrative review and intent to revoke order in part.

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SUMMARY: In response to a request by the respondent, Illovo Sugar Ltd., 
the Department of Commerce is conducting an administrative review of 
the antidumping duty order on furfuryl alcohol from the Republic of 
South Africa. The review covers one manufacturer/exporter of the 
subject merchandise to the United States. The period of review is June 
1, 1997, through May 31, 1998.
    We preliminarily find that sales have not been made below normal 
value. If these preliminary results are adopted in our final results of 
administrative review, we will instruct the Customs Service to assess 
no antidumping duties on the subject merchandise exported by Illovo 
Sugar Ltd. Furthermore, if these preliminary results are adopted in our 
final results of this administrative review, we intend to revoke the 
antidumping duty order with respect to Illovo Sugar Ltd., based on 
three consecutive review periods of sales at not less than normal 
value. See Intent to Revoke section of this notice.
    Interested parties are invited to comment on these preliminary 
results. Parties who submit case briefs in this proceeding are 
requested to provide, for each comment: (1) a statement of the issue; 
and (2) a brief summary of the argument.

EFFECTIVE DATE: March 8, 1999.

FOR FURTHER INFORMATION CONTACT: Charles Riggle or Kris Campbell, AD/
CVD Enforcement Group I, Import Administration, International Trade 
Administration, U.S. Department of Commerce, 14th Street and 
Constitution Avenue, Washington, DC 20230; telephone: (202) 482-0650 or 
482-3813, respectively.

SUPPLEMENTARY INFORMATION:

The Applicable Statute and Regulations

    Unless otherwise indicated, all citations to the Tariff Act of 
1930, as amended (the Act), are references to the provisions effective 
January 1, 1995, the effective date of the amendments made to the Act 
by the Uruguay Round Agreements Act (URAA). In addition, unless 
otherwise indicated, all citations to the Department of Commerce's (the 
Department's) regulations are to the regulations codified at 19 CFR 
Part 351 (1998).

Background

    On June 21, 1995, the Department published in the Federal Register 
(60 FR 32302) the antidumping duty order on furfuryl alcohol from the 
Republic of South Africa. On June 10, 1998, the Department published a 
notice of ``Opportunity to Request an Administrative Review'' (63 FR 
31717) of this antidumping duty order for the period June 1, 1997, 
through May 31, 1998. On June 22, 1998, we received a timely request 
for review from Illovo Sugar Ltd. (ISL) and Harborchem, ISL's related 
selling agent in the United States. In addition, ISL requested that the 
Department revoke the antidumping duty order with respect to ISL. On 
July 28, 1998, we published the notice of initiation of this review (63 
FR 40258).
    We issued a questionnaire to ISL on July 24, 1998, followed by a 
supplemental questionnaire on October 27, 1998. Because ISL requested 
revocation of the order, the Department verified the company's response 
pursuant to section 782(i)(2) of the Act.

Scope of Review

    The merchandise covered by this order is furfuryl alcohol 
(C4H3OCH2OH). Furfuryl alcohol is a 
primary alcohol and is colorless or pale yellow in appearance. It is 
used in the manufacture of resins and as a wetting agent and solvent 
for coating resins, nitrocellulose, cellulose acetate, and other 
soluble dyes. The product subject to this order is classifiable under 
subheading 2932.13.00 of the Harmonized Tariff Schedule of the United 
States (HTSUS). Although the HTSUS subheading is provided for 
convenience and customs purposes, our written description of the scope 
of this proceeding is dispositive.

Verification

    As provided in section 782(i)(2) of the Act, we verified 
information provided by ISL and Harborchem. We used

[[Page 10984]]

standard verification procedures, including on-site inspection of the 
manufacturer's facilities and examination of relevant sales and 
financial records. Our verification results are outlined in the 
verification reports placed in the case file.

Comparisons

    We compared the constructed export price (CEP) to the normal value, 
as described in the Constructed Export Price and Normal Value sections 
of this notice. Pursuant to section 777A(d)(2) of the Act, we compared 
the CEPs of individual transactions to contemporaneous monthly 
weighted-average prices of sales of the foreign like product. We were 
able to compare all subject merchandise sold during the POR to 
identical merchandise sold in the home market.

Constructed Export Price

    For sales to the United States, we calculated a CEP as defined in 
section 772(b) of the Act because we determined that ISL is affiliated 
with its exclusive U.S. agent, Harborchem, and because the subject 
merchandise was sold to unaffiliated U.S. purchasers after the date of 
importation. Our finding that ISL and Harborchem are affiliated is 
consistent with our findings in the less-than-fair-value (LTFV) 
investigation and in the first and second administrative reviews. See 
Final Determination of Sales at Less Than Fair Value: Furfuryl Alcohol 
from the Republic of South Africa, 60 FR 22550, 22552 (Comment 1) (May 
8, 1995) and Notice of Final Results of Antidumping Duty Review: 
Furfuryl Alcohol from the Republic of South Africa, 62 FR 61084, 61087-
88 (Comment 5) (November 14, 1997)).
    We calculated CEP based on f.o.b. and delivered prices to 
unaffiliated purchasers in the United States. We made deductions, where 
applicable, for foreign inland movement expenses (including foreign 
warehousing and warehousing insurance), domestic brokerage and 
handling, ocean freight, marine insurance, U.S. brokerage and handling, 
U.S. inland freight expenses (offset by freight revenue), U.S. 
warehousing and insurance, and quality testing,\1\ in accordance with 
section 772(c)(2)(A) of the Act.
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    \1\ Consistent with the 1994-96 Final Results (62 FR 61084, 
61091 (Comment 9)), we have determined that quality testing expenses 
incurred by ISL are movement expenses that the company incurs upon 
the arrival of the subject merchandise at the U.S. port of entry. 
The testing is performed at the time the product is unloaded from 
the maritime vessel in order to detect any impurities that may have 
entered the product while in transit.
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    In accordance with section 772(d)(1) of the Act we also deducted 
direct selling expenses and indirect selling expenses associated with 
commercial activity in the United States. These include credit 
expenses, inventory carrying costs, and other indirect selling 
expenses.
    Finally, in accordance with section 772(d)(3) of the Act, we 
deducted an amount for profit allocated to direct, indirect, and 
imputed selling expenses associated with commercial activity in the 
United States.
    No other adjustments to CEP were claimed or allowed.

Normal Value

    In order to determine whether there was a sufficient volume of 
sales in the home market to serve as a viable basis for calculating 
normal value, we compared ISL's volume of home market sales of the 
foreign like product to the volume of its U.S. sales of the subject 
merchandise. Pursuant to section 773(a)(1) of the Act, because ISL's 
aggregate volume of home market sales of the foreign like product was 
greater than 5 percent of its aggregate volume of U.S. sales of the 
subject merchandise, we determined that the home market was viable.
    We based normal value on the price at which the foreign like 
product was first sold for consumption in South Africa, in the usual 
commercial quantities, in the ordinary course of trade, and at the same 
level of trade as the CEP,\2\ in accordance with section 
773(a)(1)(B)(i) of the Act. We made deductions from the starting price 
for home market packing and movement expenses in accordance with 
sections 773(a)(6)(B)(i) and (ii) of the Act. Pursuant to section 
773(a)(6)(C)(iii) of the Act, we made a circumstance-of-sale (COS) 
adjustment to normal value by deducting home market credit expenses.
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    \2\ The record evidence before us in this review indicates that 
the home market and the CEP levels of trade have not changed from 
the 1994-96 Review. See 62 FR 61084, 61089-90 (Comment 7). 
Furthermore, in this review, unlike the prior segments of the 
proceeding, ISL has not claimed entitlement to a CEP offset.
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    No other adjustments to normal value were claimed or allowed.

Intent To Revoke

    On June 22, 1998, ISL requested that, pursuant to 19 CFR 
351.222(b), ``the Department revoke the antidumping duty finding in the 
above-referenced proceeding with respect to Illovo at the conclusion of 
this administrative review.'' ISL submitted along with its revocation 
request a certification stating that: (1) the company sold subject 
merchandise at not less than normal value during the POR, and that in 
the future it would not sell such merchandise at less than normal value 
(see 19 CFR 351.222(e)(i)); and (2) the company has sold the subject 
merchandise to the United States in commercial quantities during each 
of the past three years (see 19 CFR 351.222(e)(ii)). ISL further stated 
in its revocation request that, because it was the sole producer/
reseller of subject merchandise, it was not required to submit an 
additional certification (as set forth at 19 CFR 351.222(b)(iii), and 
as referenced at 19 CFR 351.222(e)(iii)) agreeing to its immediate 
reinstatement in the order, as long as any exporter or producer is 
subject to the order, if the Department concludes that the company, 
subsequent to revocation, sold the subject merchandise at less than 
normal value. However, because record evidence indicates that a South 
African company unrelated to ISL has exported the subject merchandise 
to the United States under the order, ISL has now provided this 
certification at the Department's request.
    Based on the preliminary results in this review and the final 
results of the two preceding reviews (see Notice of Final Results of 
Antidumping Duty Review: Furfuryl Alcohol from the Republic of South 
Africa, 62 FR 61084 (November 14, 1997) and Notice of Final Results of 
Antidumping Duty Review: Furfuryl Alcohol from the Republic of South 
Africa, 63 FR 30473 (June 4, 1998)), ISL has preliminarily demonstrated 
three consecutive years of sales at not less than normal value. 
Furthermore, ISL's aggregate sales to the United States have been made 
in commercial quantities during all segments of this proceeding. Based 
on the above facts and absent any evidence to the contrary, the 
Department preliminarily determines that it is not likely in the future 
that ISL will sell the subject merchandise in the United States at less 
than normal value. Therefore, if these preliminary findings are 
affirmed in our final results, we intend to revoke the order with 
respect to merchandise produced and exported by ISL. In accordance with 
19 CFR 351.222 (f), we will terminate the suspension of liquidation for 
any such merchandise entered, or withdrawn from warehouse, for 
consumption on or after June 1, 1998, and will instruct Customs to 
release any cash deposit.

Currency Conversion

    We made currency conversions based on the exchange rates in effect 
on the dates of the U.S. sales as certified by the Federal Reserve Bank 
of New York. Section 773A(a) of the Act directs the Department to use a 
daily exchange rate

[[Page 10985]]

in order to convert foreign currencies into U.S. dollars, unless the 
daily rate involves a ``fluctuation.'' In accordance with our practice, 
we have determined as a general matter that a fluctuation exists when 
the daily exchange rate differs from a benchmark by 2.25 percent. The 
benchmark is defined as the rolling average of rates for the past 40 
business days. When we determine a fluctuation exists, we substitute 
the benchmark for the daily rate. See Policy Bulletin 96-1 Currency 
Conversions, 61 FR 9434 (March 8, 1996).

Preliminary Results of Review

    As a result of this review, we preliminarily determine that the 
following margin exists for the period June 1, 1997-May 31, 1998:

------------------------------------------------------------------------
                                                                Margin
                    Manufacturer/exporter                      (percent)
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Illovo Sugar Ltd............................................        0.00
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    Interested parties may submit case briefs within 30 days of the 
date of publication of this notice. Rebuttal briefs, which must be 
limited to issues raised in the case briefs, may be filed not later 
than five days after the date after the submission of the case briefs. 
Any interested party may request a hearing within 30 days of 
publication of this notice. Any hearing, if requested, will be held two 
days after the submission of rebuttal briefs, or the first workday 
thereafter. The Department will issue a notice of the final results of 
this administrative review, which will include the results of its 
analysis of issues raised in any briefs, within 120 days from the 
publication of these preliminary results.
    The Department shall determine, and the Customs Service shall 
assess, antidumping duties on all appropriate entries. If these 
preliminary results are adopted in our final results, we will instruct 
the Customs Service to assess no antidumping duties on the merchandise 
subject to review. Upon completion of this review, the Department will 
issue appraisement instructions directly to the Customs Service.
    Furthermore, the following deposit requirements will be effective 
upon completion of the final results of this administrative review for 
all shipments of furfuryl alcohol from the Republic of South Africa 
entered, or withdrawn from warehouse, for consumption on or after the 
publication date of the final results of this administrative review, as 
provided by section 751(a)(2)(c) of the Act: (1) no cash deposit will 
be required for merchandise produced and exported by ISL if we revoke 
the order with respect to merchandise produced and exported by ISL; (2) 
if the exporter is not a firm covered in this review, the previous 
review, or the original LTFV investigation, but the manufacturer is, 
the cash deposit rate will be the rate established for the most recent 
period for the manufacturer of the merchandise; and (3) if neither the 
exporter nor the manufacturer is a firm covered in this or any previous 
review conducted by the Department, the cash deposit rate will be 11.55 
percent, the ``All Others'' rate established in the LTFV investigation.
    These cash deposit requirements, when imposed, shall remain in 
effect until publication of the final results of the next 
administrative review.
    This notice serves as a preliminary reminder to importers of their 
responsibility under 19 CFR 351.402(f)(2) to file a certificate 
regarding the reimbursement of antidumping duties prior to liquidation 
of the relevant entries during this review period. Failure to comply 
with this requirement could result in the Secretary's presumption that 
reimbursement of antidumping duties occurred and the subsequent 
assessment of double antidumping duties.
    This administrative review and notice are in accordance with 
sections 751(a)(1) and 771(i)(1) of the Act.

    Dated: March 2, 1999.
Robert S. LaRussa,
Assistant Secretary for Import Administration.
[FR Doc. 99-5626 Filed 3-5-99; 8:45 am]
BILLING CODE 3510-DS-P