[Federal Register Volume 64, Number 150 (Thursday, August 5, 1999)]
[Notices]
[Pages 42656-42658]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-20222]


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DEPARTMENT OF COMMERCE

International Trade Administration
[A-570-003]


Final Results of Expedited Sunset Review: Cotton Shop Towels From 
the People's Republic of China

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

ACTION: Notice of final results of expedited sunset review: cotton shop 
towels from the People's Republic of China.

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SUMMARY: On January 4, 1999, the Department of Commerce (``the 
Department'') initiated a sunset review of the antidumping duty order 
on cotton shop towels from the People's Republic of China (64 FR 364) 
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 comments filed on behalf of a domestic interested party 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 order would be likely to lead to 
continuation or recurrence of dumping at the levels indicated in the 
Final Results of Review section of this notice.

FOR FURTHER INFORMATION CONTACT: Scott E. Smith or Melissa G. Skinner, 
Office of Policy for Import Administration, International Trade 
Administration, U.S. Department of Commerce, 14th Street and 
Constitution Avenue, NW, Washington, DC 20230; telephone: (202) 482-
6397 or (202) 482-1560, respectively.

EFFECTIVE DATE: August 5, 1999.

Statute and Regulations

    This review was conducted pursuant to sections 751(c) and 752 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 merchandise subject to this antidumping duty order is cotton 
shop towels from the People's Republic of China. Shop towels are 
absorbent industrial wiping cloths made from a loosely woven fabric. 
The fabric may be either 100-percent cotton or a blend of materials. 
Shop towels are currently classifiable under item numbers 6307.10.2005 
and 6307.10.2015 of the Harmonized Tariff Schedules of the United 
States (HTSUS). Although the HTSUS subheadings are provided for 
convenience and customs purposes, our written description of the scope 
of this proceeding remains dispositive.1
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    \1\ The Department determined that certain 18''x30'' dish towels 
(02/19/93) are within the scope of the order. Pursuant to court 
remand, the Department determined that certain cotton shop towels, 
hemmed or cut and hemmed in Honduras, are within the scope of the 
order (1/18/94). The Department determined that the following 
products are outside the scope of the order: towels assembled in 
Canada from cotton grey fabric from the People's Republic of China 
(8/21/90).
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    This review covers imports from all manufacturers and exporters of 
Chinese shop towels.

History of the Order

    On August 16, 1983, the Department issued its amended final 
determination of sales at less than fair value in the investigation of 
cotton shop towels from the People's Republic of China (48 FR 37055). 
The Department published weighted average dumping margins of 30.1 
percent for China National Textile Import & Export Corporation and 37.2 
percent for China National Arts & Crafts Import & Export Corporation. 
The Department also published a weighted average dumping margin of 36.2 
percent for all other Chinese manufacturers/exporters.
    The antidumping duty order on cotton shop towels from the People's 
Republic of China was published in the Federal Register on October 4, 
1983 (48 FR 45277). Since that time, the Department has conducted six 
administrative reviews.2 The order remains in effect for all 
manufacturers and exporters of the subject merchandise.
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    \2\ See Shop Towels of Cotton From the People's Republic of 
China; Final Results of Administrative Review of Antidumping Order, 
50 FR 26020 (June 24, 1985); Shop Towels of Cotton From the People's 
Republic of China; Final Results of Administrative Review of 
Antidumping Order, 55 FR 7756 (March 5, 1990); Shop Towels of Cotton 
From the People's Republic of China; Final Results of Administrative 
Review of Antidumping Order, 56 FR 4040 (February 1, 1991); Shop 
Towels of Cotton From the People's Republic of China; Final Results 
of Administrative Review of Antidumping Order, 56 FR 60969 (November 
29, 1991); Shop Towels of Cotton From the People's Republic of 
China; Final Results of Administrative Review of Antidumping Order, 
57 FR 30466 (July 9, 1992); and Shop Towels of Cotton From the 
People's Republic of China; Final Results of Administrative Review 
of Antidumping Order, 57 FR 43695 (September 22, 1992).
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Background

    On January 4, 1999, the Department initiated a sunset review of the 
antidumping duty order on cotton shop towels from the People's Republic 
of China (64 FR 364), pursuant to section 751(c) of the Act. The 
Department received a Notice of Intent to Participate on behalf of 
Milliken & Company (``Milliken'') on January 19, 1999, within the 
deadline specified in Sec. 351.218(d)(1)(i) of the Sunset Regulations. 
We received a complete substantive response from Milliken on February 
3, 1999, within the 30-day deadline specified in the Sunset Regulations 
under Sec. 351.218(d)(3)(i). Milliken claimed interested party status 
under section 771(9)(C) of the Act, as a domestic producer of shop 
towels. In addition, Milliken stated that it was the petitioner in the 
original investigation. We did not receive a substantive response from 
any respondent interested party to this proceeding. As a result, 
pursuant to 19 CFR 351.218(e)(1)(ii)(C), the Department determined to 
conduct an expedited, 120-day, review of this order.
    The Department determined that the sunset review of the antidumping 
duty order on cotton shop towels from the People's Republic of China is 
extraordinarily complicated. In accordance with section 751(c)(5)(C)(v) 
of the Act, the Department may treat a review as extraordinarily 
complicated if it is a review of a transition order (i.e., an order in 
effect on January 1, 1995). Therefore, on May 3, 1999, the Department 
extended the time limit for

[[Page 42657]]

completion of the final results of this review until not later than 
August 2, 1999, in accordance with section 751(c)(5)(B) of the 
Act.3
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    \3\ See Steel Wire Rope From Japan, Shop Towels From the 
People's Republic of China, Shop Towels From Bangladesh, Candles 
From the People's Republic of China, Steel Wire Rope From Mexico, 
Shop Towels From Pakistan, Steel Wire Rope From South Korea, 
Malleable Cast Iron Pipe Fittings From South Korea, Malleable Cast 
Iron Pipe Fittings From Taiwan, Malleable Cast Iron Pipe Fittings 
From Japan: Extension of Time Limit for Final Results of Five-Year 
Reviews, 64 FR 24573 (May 7, 1999).
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Determination

    In accordance with section 751(c)(1) of the Act, the Department 
conducted this review to determine whether revocation of the 
antidumping duty 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 the subject merchandise for the 
period before and the period after the issuance of the antidumping duty 
order, and it 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, Milliken'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 duty 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 of the subject 
merchandise declined significantly (see section II.A.3).
    In addition to considering 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 Sec. 351.218(d)(2)(iii) of the Sunset Regulations, 
this constitutes a waiver of participation.
    In its substantive response, Milliken argues that the history of 
the case and the actions taken by Chinese producers and exporters of 
shop towels prior to and during the pendency of this proceeding clearly 
demonstrate that revocation likely would result in a recurrence of 
dumping of shop towels in the United States. Specifically, Milliken, 
citing The World Trade Atlas (Nov. 1998), asserts that Chinese 
producers and exporters significantly reduced their shipments to the 
United States and ultimately ceased exportation after the Department 
calculated extremely high dumping margins in subsequent reviews (see 
February 3, 1999, Substantive Response of Milliken at 4).
    In conclusion, Milliken argues that the Department should determine 
that there is a likelihood that dumping would continue or recur were 
the order revoked because imports of the subject merchandise decreased 
significantly after the imposition of the order and continue to be 
virtually non-existent.
    The Department agrees with Milliken that imports of the subject 
merchandise decreased substantially over the 16-year period from the 
imposition of the order in 1983 to the present. However, we disagree 
with Milliken's assertion that the Department should rest its decision 
on the basis that imports of subject merchandise have ceased. Despite a 
two-year cessation of imports between 1996 and 1997, shipments of the 
subject merchandise from the People's Republic of China continue.
    With respect to dumping margins, an examination of the final 
results of administrative reviews confirms that dumping margins above 
de minimis levels have continued throughout the life of the 
order.4 As discussed in section II.A.3 of the Sunset Policy 
Bulletin, the SAA at 890, and the House Report at 63-64, if companies 
continue dumping with the discipline of an order in place, the 
Department may reasonably infer that dumping would continue if the 
discipline were removed.
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    \4\ See Shop Towels of Cotton From the People's Republic of 
China; Final Results of Administrative Review of Antidumping Order, 
50 FR 26020 (June 24, 1985); Shop Towels of Cotton From the People's 
Republic of China; Final Results of Administrative Review of 
Antidumping Order, 55 FR 7756 (March 5, 1990); Shop Towels of Cotton 
From the People's Republic of China; Final Results of Administrative 
Review of Antidumping Order, 56 FR 4040 (February 1, 1991); Shop 
Towels of Cotton From the People's Republic of China; Final Results 
of Administrative Review of Antidumping Order, 56 FR 60969 (November 
29, 1991); Shop Towels of Cotton From the People's Republic of 
China; Final Results of Administrative Review of Antidumping Order, 
57 FR 30466 (July 9, 1992); and Shop Towels of Cotton From the 
People's Republic of China; Final Results of Administrative Review 
of Antidumping Order, 57 FR 43695 (September 22, 1992).
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    Based on this analysis, the Department finds that the existence of 
dumping margins after the issuance of the order is highly probative of 
the likelihood of continuation or recurrence of dumping. Deposit rates 
above de minimis levels continue in effect for exports of the subject 
merchandise by all known Chinese manufacturers/exporters. Therefore, 
given that dumping has continued over the life of the order, imports of 
subject merchandise declined significantly, and respondent interested 
parties have waived their right to participate in this review before 
the Department, and absent argument and evidence to the contrary, the 
Department determines that dumping is likely to continue if the order 
were revoked.

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 final determination of sales at less than 
fair value, published weighted-average

[[Page 42658]]

dumping margins for two producers/exporters of cotton shop towels from 
the People's Republic of China (48 FR 37055, August 16, 
1983).5 The Department also published an ``all others'' rate 
in its determination. We note that, to date, the Department has not 
issued any duty absorption findings in this case.
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    \5\ The dumping margins from this determination were 
subsequently amended. See Cotton Shop Towels From the People's 
Republic of China; Amended Final Determination of Sales at Less Than 
Fair Value, 48 FR 37055 (August 16, 1983).
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    In its substantive response, citing to the final results of the 
1990/1991 administrative review, Milliken asserts that the margins 
found in the original investigation are far below the most recently 
calculated margins. Accordingly, Milliken argues that, consistent with 
the Sunset Policy Bulletin and legislative history, the Department 
should inform the Commission that the margins likely to prevail are the 
more recently calculated rates of 72.14 percent for Tianjin Arts & 
Crafts Import & Export Corporation and 122.81 percent for all other 
companies. Milliken notes that its suggested margins, from the 1990/
1991 administrative review, reflect the most likely U.S. pricing levels 
for Chinese shop towels if the order were revoked (see February 3, 1999 
Substantive Response of Milliken at 6).
    The Department disagrees with Milliken's argument concerning the 
choice of the margins to report to the Commission. The Department finds 
the existence of higher margins after the initial investigation, as a 
sole criterion, provides insufficient reason for the Department to 
deviate from its stated policy.6 Milliken has not presented 
any argument or evidence to suggest that such increases in margins have 
been coupled with increases in import volumes and, thus, increased 
dumping in an attempt to gain, or even maintain, market share. Absent 
such argument and evidence, the Department finds that the margins 
calculated in the original investigation are probative of the behavior 
of Chinese producers and/or exporters if the order were revoked as they 
are the only margins which reflect their actions absent the discipline 
of the order. As such, the Department will report to the Commission the 
company-specific and ``all others'' rates from the original 
investigation as contained in the Final Results of Review section of 
this notice.
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    \6\ The Department recognizes that where a more recent dumping 
margin is ``more representative of a company's behavior in the 
absence of an order,'' such margin should be reported to the 
Commission (see Sunset Policy Bulletin). The ``more representative'' 
standard may be satisfied if the Department finds an ``increase in 
imports * * * corresponding to the increase in the dumping margin'' 
(see Final Results of Expedited Sunset Review: Barium Chloride From 
the People's Republic of China, 64 FR 5633 (February 4, 1999)).
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Final Results of Review

    As a result of this review, the Department finds that revocation of 
the antidumping duty order would likely lead to continuation or 
recurrence of dumping at the margins listed below:

------------------------------------------------------------------------
                                                                Margin
                   Manufacturer/exporter                      (percent)
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China National Textile Import & Export Corp................         30.1
China National Arts & Crafts Import & Export Corp..........         37.2
All Other Chinese Manufacturers/Exporters..................         36.2
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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.

    Dated: July 30, 1999.
Joseph A. Spetrini,
Acting Assistant Secretary for Import Administration.
[FR Doc. 99-20222 Filed 8-4-99; 8:45 am]
BILLING CODE 3510-DS-P