[Federal Register Volume 64, Number 206 (Tuesday, October 26, 1999)]
[Notices]
[Pages 57628-57629]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-27834]


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DEPARTMENT OF COMMERCE

International Trade Administration
[A-580-805]


Notice of Initiation and Preliminary Results of Changed 
Circumstances Antidumping Duty Administrative Review: Industrial 
Nitrocellulose From Korea

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

SUMMARY: The Department of Commerce (``the Department'') has received 
information sufficient to warrant initiation of a changed circumstances 
administrative review of the antidumping duty order on industrial 
nitrocellulose (``INC'') from Korea. Based on this information, we 
preliminarily determine that Korea CNC Ltd., (``KCNC''), is the 
successor-in-interest to Daesang Corporation (``Daesang'') for purposes 
of determining antidumping liability. Interested parties are invited to 
comment on these preliminary results.

EFFECTIVE DATE: October 26, 1999.

FOR FURTHER INFORMATION CONTACT: Ron Trentham or Tom Futtner, AD/CVD 
Enforcement, Group II, Office 4, Import Administration, International 
Trade Administration, U.S. Department of Commerce, 14th and 
Constitution Avenue, NW, Washington, DC 20230; telephone: (202) 482-
6320 or (202) 482-3814, respectively.

SUPPLEMENTARY INFORMATION:

Applicable Statute and Regulations

    Unless otherwise stated, all citations to the Tariff Act of 1930, 
as amended (``the Act''), are references to the provisions as of 
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 references to the regulations of the 
Department are to 19 CFR part 351 (1998).

[[Page 57629]]

Background

    On July 10, 1990, the Department published in the Federal Register 
(55 FR 28267) the antidumping order on INC from Korea. On August 25, 
1999, KCNC submitted a letter stating that KCNC is the successor-in-
interest to Daesang, and, as such, KCNC is entitled to the receive the 
same antidumping treatment as is accorded Daesang.

Scope of Review

    Imports covered by this review are shipments of INC from Korea. INC 
is a dry, white amorphous synthetic chemical with a nitrogen content 
between 10.8 and 12.2 percent, and is produced from the reaction of 
cellulose with nitric acid. INC is used as a film-former in coatings, 
lacquers, furniture finishes, and printing inks. The scope of this 
order does not include explosive grade nitrocellulose, which has a 
nitrogen content of greater than 12.2 percent.
    INC is currently classified under Harmonized Tariff System 
(``HTS'') subheading 3912.20.00. While the HTS item number is provided 
for convenience and Customs purposes, the written description remains 
dispositive as to the scope of the product coverage.

Initiation and Preliminary Results of Review

    In a letter dated August 25, 1999, KCNC advised the Department that 
on April 1, 1999, China Nitrocellulose Co. (``CNC'') purchased 
Daesang's INC business, including Daesang's only manufacturing and 
research and development (``R&D'') facility for subject merchandise, 
located at Chonju Industrial Complex No. 3, 821 Yongam-Lee, Bongdong-
Eub, Wanju-Gun, Chollabuk-Do, Korea (the ``Chonju factory''). CNC 
transferred Daesang's INC business to KCNC, which CNC had newly 
established for that purpose. KCNC operates the Chonju factory without 
change. Production continues with the same equipment, the same workers, 
the same raw materials purchased from the same suppliers, and the same 
production process. KCNC continues to sell the same products to the 
same customers to which Daesang previously sold. The organizational and 
management structure of Daesang's INC business has essentially remained 
intact, except that KCNC has appointed a new president. All management 
and employees at the plant manager level and below are the same as when 
the factory was managed by Daesang, while the managing director was 
formerly employed by Daesang in another capacity.
    Thus, in accordance with section 751(b) of the Act, the Department 
is initiating a changed circumstances review to determine whether KCNC 
is the successor-in-interest to Daesang for purposes of determining 
antidumping duty liability. In making such a successor-in-interest 
determination, the Department examines several factors including, but 
not limited to, changes in: (1) Management; (2) production facilities; 
(3) supplier relationships; and (4) customer base. See Brass Sheet and 
Strip from Canada: Notice of Final Results of Antidumping 
Administrative Review, 57 FR 20460 (May 13, 1992) (``Canadian Brass''). 
While no one or several of these factors will necessarily provide a 
dispositive indication, the Department will generally consider the new 
company to be the successor to the previous company if its resulting 
operation is not materially dissimilar to that of its predecessor. See, 
e.g., Industrial Phosphoric Acid from Israel: Final Results of Changed 
Circumstances Review, 59 FR 6944 (February 14, 1994) and Canadian 
Brass, 57 FR 20460. Thus, if the evidence demonstrates that, with 
respect to the production and sale of the subject merchandise, the new 
company operates as the same business entity as the former company, the 
Department will assign the new company the cash deposit rate of its 
predecessor.
    We preliminarily determine that KCNC is the successor-in-interest 
to Daesang. KCNC's management is virtually identical to Daesang. KCNC's 
business operation, with respect to the subject merchandise, is 
identical to the INC operations of Daesang. Production facilities are 
unchanged as are customer and supplier lists. Thus, KCNC should receive 
the same antidumping duty treatment as the former Daesang, i.e., a 2.10 
percent antidumping duty cash deposit rate. This cash deposit 
requirement will apply to all unliquidated entries of the subject 
merchandise entered, or withdrawn from warehouse, for consumption on or 
after the date of publication of the final results of this changed 
circumstances review. This deposit rate shall remain in effect until 
publication of the final results of the next administrative review.
    Interested parties are invited to comment on these preliminary 
results. Any written comments may be submitted no later than 30 days 
after date of publication of this notice. Rebuttal briefs, limited to 
arguments raised in case briefs, are due five days after the case brief 
deadline. Case briefs and rebuttal briefs must be served on interested 
parties in accordance with 19 CFR 351.309. The Department will publish 
the final results of the changed circumstances review including the 
results of any such comments.
    This initiation of review, preliminary results of review and notice 
are in accordance with sections 751(b) and 777(i)(1) of the Act.

    Dated: October 18, 1999.
Robert A. LaRussa,
Assistant Secretary, Import Administration.
[FR Doc. 99-27834 Filed 10-25-99; 8:45 am]
BILLING CODE 3510-DS-P