[Federal Register Volume 64, Number 150 (Thursday, August 5, 1999)]
[Notices]
[Pages 42668-42670]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-20218]
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DEPARTMENT OF COMMERCE
International Trade Administration
[A-588-706]
Final Results of Expedited Sunset Review: Nitrile Rubber From
Japan
AGENCY: Import Administration, International Trade Administration,
Department of Commerce.
ACTION: Notice of final results of expedited sunset review: Nitrile
rubber from Japan.
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SUMMARY: On April 1, 1999, the Department of Commerce (the
``Department'') initiated a sunset review of the antidumping order on
nitrile rubber from Japan (64 FR 15727) pursuant to section 751(c) of
the Tariff Act of 1930, as amended (the ``Act''). On the basis of a
notice of intent to participate and adequate substantive response filed
on behalf of domestic interested parties and inadequate response (in
this case, no response) from respondent interested parties, the
Department determined to conduct an expedited review. As a result of
this review, the Department finds that revocation of the antidumping
duty order would be likely to lead to continuation or recurrence of
dumping at the levels indicated in the ``Final Result of Review''
section of this notice.
FOR FURTHER INFORMATION CONTACT: Eun W. Cho or Melissa G. Skinner,
Office of Policy for Import Administration, International Trade
Administration, US Department of Commerce, 14th Street and Constitution
Avenue, NW, Washington, DC 20230; telephone: (202) 482-1698 or (202)
482-1560, respectively.
EFFECTIVE DATE: August 5, 1999.
Statute and Regulations
This review was conducted pursuant to sections 751(c) and 752(c) of
the Act. The Department's procedures for the conduct of sunset reviews
are set forth in Procedures for Conducting Five-Year (``Sunset'')
Reviews of Antidumping and Countervailing Duty Orders, 63 FR 13516
(March 20, 1998) (``Sunset Regulations''). Guidance on methodological
or analytical issues relevant to the Department's conduct of sunset
reviews is set forth in the Department's Policy Bulletin 98:3--Policies
Regarding the Conduct of Five-year (``Sunset'') Reviews of Antidumping
and Countervailing Duty Orders; Policy Bulletin, 63 FR 18871 (April 16,
1998) (``Sunset Policy Bulletin'').
Scope
The subject merchandise under consideration is butadiene
acrylonitrile copolymer synthetic rubber (``nitrile rubber'') not
containing fillers, pigments, or rubber-processing chemicals from
Japan. Nitrile rubber refers to the synthetic rubber that is made from
the polymerization of butadiene and acrylonitrile, and that does not
contain any type of additive or compounding ingredient having a
function in processing, vulcanization, or end use of the product. Latex
rubber is excluded from this order.
Nitrile rubber is currently classifiable under item number
4002.59.0000 of the Harmonized Tariff Schedule of the United States
(HTSUS). The HTSUS item number is provided for convenience and Customs
purposes only. The written product description of the scope of this
order remains dispositive.
History of the Order
The antidumping duty order on nitrile rubber from Japan was
published in the Federal Register on June 16, 1988 (53 FR 22553). In
that order, the Department estimated that the weighted-average dumping
margins for Nippon Zeon Co., Ltd. (``Nippon'') as well as for ``all-
others'' were 146.50 percent. The Department has not conducted any
administrative review since that time.1 The order remains in
effect for all manufacturers and exporters of the subject merchandise.
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\1\ There has been only a single review requested by a Japanese
firm, Japan Synthetic Rubber Co., Ltd. That request, however, was
timely withdrawn by the same firm. Consequently, the Department
terminated the review. See Termination of Antidumping Duty
Administrative Review, 62 FR 54822 (October 22, 1997).
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Background
On April 1, 1999, the Department initiated a sunset review of the
antidumping duty order on nitrile rubber from Japan (64 FR 15727)
pursuant to section 751(c)(6)(A)(i) of the Act. The Department received
a Notice of Intent to Participate on behalf of Zeon Chemicals, L.P.
(``Zeon'') on April 16, 1999, within the deadline specified in section
351.218(d)(1)(i) of the Sunset Regulations. Zeon claimed interest party
status under section 771(9)(C) of the Act as a domestic producer of
nitrile rubber.
We received a complete substantive response from Zeon on May 3,
1999, within the 30-day deadline specified in the Sunset Regulations
under section 351.218(d)(3)(i). Zeon noted that although Zeon did not
exist at the time of the original antidumping determination, from which
the present proceeding is derived, Zeon is currently the largest
producer of nitrile rubber in the United States (see May 3, 1999,
Substantive Response of Zeon at 3). Zeon further noted that the parent
company of Zeon, the Japanese firm Nippon, had participated in the
original investigation as a respondent interested party (see id.).
Also, Zeon indicated that Zeon previously changed its name from ``Zeon
Chemicals Incorporated'' to ``Zeon Chemicals, L.P.'' (See id.). We did
not receive a substantive response from any respondent interested
parties to this proceeding. Consequently, pursuant to section
351.218(e)(1)(ii)(C) of the Sunset Regulations, the Department
determined to conduct an expedited, 120-day, review of this order.
Determination
In accordance with section 751(c)(1) of the Act, the Department
conducted this review to determine whether revocation of the
antidumping order would be likely to lead to continuation or recurrence
of dumping. Section 752(c) of the Act provides that, in making this
determination, the Department shall consider the weighted-average
dumping margins determined in the investigation and subsequent reviews
and the volume of imports of
[[Page 42669]]
the subject merchandise for the period before and the period after the
issuance of the antidumping order, and shall provide to the
International Trade Commission (``the Commission'') the magnitude of
the margin of dumping likely to prevail if the order is revoked.
The Department's determinations concerning continuation or
recurrence of dumping and the magnitude of the margin are discussed
below. In addition, Zeon's comments with respect to continuation or
recurrence of dumping and the magnitude of the margin are addressed
within the respective sections below.
Continuation or Recurrence of Dumping
Drawing on the guidance provided in the legislative history
accompanying the Uruguay Round Agreements Act (``URAA''), specifically
the Statement of Administrative Action (``the SAA''), H.R. Doc. No.
103-316, vol. 1 (1994), the House Report, H.R. Rep. No. 103-826, pt.1
(1994), and the Senate Report, S. Rep. No. 103-412 (1994), the
Department issued its Sunset Policy Bulletin providing guidance on
methodological and analytical issues, including the bases for
likelihood determinations. In its Sunset Policy Bulletin, the
Department indicated that determinations of likelihood will be made on
an order-wide basis (see section II.A.2). In addition, the Department
indicated that normally it will determine that revocation of an
antidumping order is likely to lead to continuation or recurrence of
dumping where (a) Dumping continued at any level above de minimis after
the issuance of the order, (b) imports of the subject merchandise
ceased after the issuance of the order, or (c) dumping was eliminated
after the issuance of the order and import volumes for the subject
merchandise declined significantly (see section II.A.3).
In addition to considering the guidance on likelihood cited above,
section 751(c)(4)(B) of the Act provides that the Department shall
determine that revocation of an order is likely to lead to continuation
or recurrence of dumping where a respondent interested party waives its
participation in the sunset review. In the instant review, the
Department did not receive a response from any respondent interested
party. Pursuant to section 351.218(d)(2)(iii) of the Sunset
Regulations, this constitutes a waiver of participation.
In its substantive response, Zeon argues that dumping of the
subject merchandise would resume if the antidumping duty order were
revoked (see, May 3, 1999 Substantive Response of Zeon at 3). In
support of its assertion, Zeon notes that the volume of imports of the
subject merchandise immediately and dramatically decreased after the
discipline of the antidumping order was put into effect. In addition,
Zeon points to the existence of continued dumping above the de minimis
level throughout the life of the order.
In addition to argument related to previously calculated dumping
margins and the volume of imports before and after the issuance of the
order, Zeon asserts that there are other facts that support a
determination that revocation would result in resumption of dumping.
Zeon notes that Japanese companies continue to manufacture the subject
merchandise for export. Furthermore, Zeon asserts that the U.S. market
has proven highly penetrable to imports of nitrile rubber. In
conclusion, Zeon asserts that because nitrile rubber is highly fungible
(and, therefore, U.S. purchasers quickly switch suppliers based on a
small price changes), Japanese producers could easily regain customers
by resuming dumping were the order revoked.
The Department agrees with Zeon's argument that imports have
declined significantly since imposition of the order. Statistics drawn
from U.S. Census Bureau IM146 reports (``IM146''), Import Special
Information Service of the Journal of Commerce (``ISIS''), and Trade
Information On-Line Service (``TIOS'') support Zeon's assertion that
there was a substantial decrease of imports of the subject merchandise
immediately after the issuance of the antidumping duty order. For
instance, between 1987 and 1988 the imports of the subject merchandise
fell 61 percent.2 Moreover, between 1988 and 1998, the
average volume of imports of the subject merchandise is a mere 18
percent of the pre-order level, some variations
notwithstanding.3
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\2\ As noted above, the antidumping duty order was issued on
June, 1988.
\3\ For example, in 1989, imports of the subject merchandise
increased 28 percent compared to the reduced 1988 imports volume;
however, this is still less than 50 percent of the pre-order level.
More significantly, during the period from 1994 to 1998, the annual
average import volume of the subject merchandise has fallen to 12
percent of the pre-order import volume.
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With respect to the weighted-average dumping margins, as noted
above, there has not been any administrative review with respect to the
antidumping order under consideration. Consequently, the only weighted-
average dumping margin available to the Department is the one that was
determined in the original investigation: 146.50 percent. As a result,
the Department finds that since the issuance of the antidumping duty
order, imports of nitrile rubber from Japan have continued to be
assessed the weighted-average dumping margin of 146.50 percent, which
is significantly above de minimis.
In conclusion, considering the facts that respondent parties waived
their right to participate in instant review, that dumping margins
above de minimis level continued since the issuance of the order, and
that import volumes substantially decreased after the issuance of the
order, the Department finds that continuation or recurrence of dumping
is likely if the antidumping duty order is revoked.
Since the Department based this determination on the facts that the
import volume of the subject merchandise decreased substantially and
that dumping continued at levels above de minimis, it is not necessary
to address Zeon's additional arguments.
Magnitude of the Margin
In the Sunset Policy Bulletin, the Department stated that it will
normally provide to the Commission the margin that was determined in
the final determination in the original investigation. Further, for
companies not specifically investigated or for companies that did not
begin shipping until after the order was issued, the Department
normally will provide a margin based on the ``all others'' rate from
the investigation. (See section II.B.1 of the Sunset Policy Bulletin.)
Exceptions to this policy include the use of a more recently calculated
margin, where appropriate, and consideration of duty absorption
determinations. (See sections II.B.2 and 3 of the Sunset Policy
Bulletin.)
The Department, in its notice of the antidumping duty order on
nitrile rubber from Japan, established both company-specific and
country-wide weighted-average dumping margins of 146.50 percent for all
imports of the subject merchandise from Japan (53 FR 22553, June 16,
1988). We note that, to date, the Department has not issued any duty
absorption findings in this case.
In its substantive response, Zeon asserts that revocation of the
antidumping duty order would result in a resumption of dumping order at
146.50 percent, which is the weighted-average margin found in the
investigation. Zeon argues that this is consistent with the SAA and
Sunset Policy Bulletin, particularly in a case such as this where no
administrative review has been conducted. In conclusion, Zeon argues
that the decline in imports following the issuance of the order coupled
with the fact that there
[[Page 42670]]
have been no administrative reviews further suggests that the margins
from the order accurately reflect the minimum level of dumping that
Japanese companies must maintain to sell nitrile rubber in the U.S.
market.
The Department agrees with the Zeon. Absent argument and evidence
to the contrary, the Department finds the margins calculated in the
original investigation are probative of the behavior of Japanese
producers/exporters if the order were revoked, as they are the only
margins which reflect their behavior absent the discipline of the
order. Therefore, the Department will report to the Commission the
company-specific and all other margins reported in the ``Final Results
of Review'' section of this notice.
Final Results of Review
Based on the above analysis, the Department finds that the
revocation of the antidumping order would likely lead to continuation
or recurrence of dumping at the margins listed below:
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Margin
Manufacturer/exporter (percent)
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Nippon Zeon Co. Ltd........................................ 146.50
All others................................................. 146.50
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This notice serves as the only 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 of the Department's regulations.
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 five-year (``sunset'') review and notice are in accordance
with sections 751(c), 752, and 777(i)(1) of the Act.
Joseph A. Spetrini,
Acting Assistant Secretary for Import Administration.
[FR Doc. 99-20218 Filed 8-4-99; 8:45 am]
BILLING CODE 3510-DS-P