[Federal Register Volume 64, Number 207 (Wednesday, October 27, 1999)]
[Notices]
[Pages 57850-57852]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-28065]
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DEPARTMENT OF COMMERCE
International Trade Administration
[A-412-803]
Final Results of Expedited Sunset Review: Industrial
Nitrocellulose From the United Kingdom
AGENCY: Import Administration, International Trade Administration,
Department of Commerce.
ACTION: Notice of final results of expedited sunset review: Industrial
Nitrocellulose from the United Kingdom.
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SUMMARY: On June 1, 1999, the Department of Commerce (``the
Department'') initiated a sunset review of the antidumping order on
industrial nitrocellulose from the United Kingdom (64 FR 29261)
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 an
adequate substantive response 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 duty 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: Eun W. Cho 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, D.C. 20230; telephone: (202) 482-
1698 or (202) 482-1560, respectively.
EFFECTIVE DATE: October 27, 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'') and 19 CFR Part 351 (1998) in
general. 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 product covered by this antidumping order is industrial
nitrocellulose (``INC'') from the United Kingdom. Industrial 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 greater than 12.2 percent. INC is currently
classifiable under Harmonized Tariff Schedule (``HTS'') item number
3912.20.00. The HTS item number is provided for convenience and customs
purposes only. The written description remains dispositive.
History of the Order
The antidumping duty order on nitrocellulose from the United
Kingdom was published in the Federal Register on July 10, 1990 (55 FR
28270).1 In that order, the Department determined that the
weighted-average dumping margin for all entries of the subject
merchandise is 11.13 percent.2 Since that time, the
Department has completed several administrative reviews.3 We
note that, to date, the Department has not issued any duty absorption
findings in this case. The order remains in effect for all
manufacturers and exporters of the subject merchandise.
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\1\ See Antidumping Duty Order: INC from the United Kingdom, 55
FR 28270 (July 10, 1990).
\2\ However, the underlying investigation and subsequent
administrative reviews dealt with only one British company, Imperial
Chemical Industries PLC (``Imperial'').
\3\ See INC From the United Kingdom: Final Results of
Antidumping Duty Administrative Review, 59 FR 66902 (December 28,
1994), as amended, INC From the United Kingdom: Amendment of Final
Results of Antidumping Duty Administrative Review, 60 FR 41876
(August 14, 1995); INC From the United Kingdom: Final Results of
Antidumping Duty Administrative Review, 61 FR 29342 (June 10, 1996);
INC From the United Kingdom: Notice of Final Results of Antidumping
Duty Administrative Review, 64 FR 6609 (February 10, 1999), as
amended, INC From the United Kingdom: Amended Final Results of
Antidumping Duty Administrative Review, 64 FR 11836 (March 10,
1999).
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Background
On June 1, 1999, the Department initiated a sunset review of the
antidumping duty order on nitrocellulose from the United Kingdom (64 FR
29261), pursuant to section 751(c) of the Act. The Department received
a Notice of Intent to Participate on behalf of Hercules Incorporated
(``Hercules'') on June 9, 1999, within the deadline specified in
section 351.218(d)(1)(i) of the Sunset Regulations. Hercules asserted
that it is not related to a foreign producer, foreign exporter, or
domestic importer of the subject merchandise and that it is not an
importer of the subject merchandise except on an occasional spot basis.
(See Hercules' June 9, 1999 Intent to Participate at 2.)
We received a complete substantive response from Hercules on July
1, 1999, within the 30-day deadline specified in the Sunset Regulations
under section 351.218(d)(3)(i). Hercules claimed interested party
status under section 771(9)(C) of the Act as a U.S. manufacturer,
producer, and wholesaler of the subject merchandise. In its substantive
response, Hercules indicated that it is the sole remaining U.S.
domestic producer of nitrocellulose, was the petitioner in the original
investigation, and has participated in all review proceedings. (See
Hercules' July 1, 1999 Substantive Response at 1-2.)
We did not receive a substantive response from any respondent
interested party 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.
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--an order which was in effect on January
1, 1995. See section 751(c)(6)(C) of the Act. The Department determined
that the sunset review of the antidumping duty order on industrial
nitrocellulose from the U.K. is extraordinarily complicated. Therefore,
on October 12, 1999, the
[[Page 57851]]
Department extended the time limit for completion of the preliminary
results of this review until not later than December 28, 1999, in
accordance with section 751(c)(5)(B) of the Act.4
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\4\ See Extension of Time Limit for Final Results of Five-Year
Reviews, 64 FR 55233 (October 12, 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 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 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 margins are discussed
below. In addition, Hercules' comments with respect to continuation or
recurrence of dumping and the magnitude of the margins 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, Hercules asserts that the likelihood
of continuation or recurrence of dumping is high if the order is
revoked. (See July 1, 1999 substantive response of Hercules at 3-5). To
support its assertion, Hercules points out that dumping of the subject
merchandise continued above the de minimis level after the issuance of
the order. Id. In addition, Hercules insists that a sharp increase of
the weighted-average dumping margins in the most recent review clearly
manifests the inability of the British manufacturers/exporters to
successfully compete without dumping in the United States.5
Id. In conclusion, Hercules argues that British manufacturers/exporters
of the subject merchandise have demonstrated over the past decade that
they have to dump in order to export the subject merchandise to the
United States.
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\5\ See footnote 3, supra. Although weighted-average dumping
margins of the subject merchandise decreased in each of the first
two administrative reviews (from original investigation margin of
11.13 percent to 6.62 percent in the first review and then to 1.48
percent in the second review), in the third and the most recent
administrative review, the dumping margin increased to 13.0 percent.
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Consistent with section 752(c) of the Act, the Department
considered the import volumes of the subject merchandise before and
after the issuance of the order. The data supplied by Hercules and
those of the United States Census Bureau IM146s and the United States
International Trade Commission indicate that, since the imposition of
the order, the import volumes of the subject merchandise have shown an
increasing trend. 6 Moreover, for the period between 1994
and 1998, the United States International Trade Commission Data show
rather substantially increased import volumes of the subject
merchandise compared to those of pre-order. 7 Therefore, the
Department determines that, as acknowledged by Hercules in its July 1,
1999 substantive response at 5, the import volumes of the subject
merchandise increased or showed an increasing trend after the issuance
of the order.
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\6\ The import volumes of the subject merchandise are as follows
(the order was issued in June of 1990; numbers are in metric tons):
1989-2,430; 1990-3,279; 1991-3,415; 1992-3,931; 1993-3,828; 1994-
4,096; 1995-3,423; 1996-3,991; 1997-3,594; 1998-3,461. These numbers
correspond exactly with the U.S. International Trade Commission
Data.
\7\ See footnote 6, supra. During 1994-1998, the average import
volume of the subject merchandise was 3,713 metric tons, which
denotes a 30.0 percent increase over the average of 1989 and 1990
pre-order import levels, or 53 percent over 1989 import volume
alone.
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The Department also considered whether dumping continued at any
level above de minimis after the issuance of the order. As indicated in
section II.A.3 of the Sunset Policy Bulletin, the SAA at 890, and 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 were the discipline removed. After examining the
published findings with respect to weighted-average dumping margins in
the original investigation and from the previous administrative
reviews, 8 the Department determines that, since the
issuance of the order, weighted-average dumping margins for the subject
merchandise have continued at above the de minimis level.
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\8\ See footnote 5, supra.
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Given that dumping of the subject merchandise continued above the
de minimis level after the issuance of the order and that respondent
interested parties have waived their right to participate in this
review, 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.)
[[Page 57852]]
The Department, in its final determination of sales at less-than-
fair-value, published a weighted-average dumping margin for Imperial
and all-others: 11.13 percent.9 We note that, to date, the
Department has not issued any duty absorption findings in this case.
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\9\ See Final Determination of Sales at Less Than Fair Value:
INC from the United Kingdom, 55 FR 21055 (May 22, 1990).
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In its substantive response, while acknowledging that the
Department normally will provide the Commission with the dumping
margins from the original investigation, Hercules argues that, in the
instant review, the Department, nevertheless, should report to the
Commission a more recently calculated margin because Imperial increased
its dumping in order to increase its market share in the United States.
(See the July 1, 1999 Substantive Response of Hercules at 6-7.) In
addition to supplying data, which tend to indicate that Imperial's
market share in the United States has increased after the imposition of
the order,10 Hercules also claims that Imperial's market
behavior of not raising its export prices,11 after a higher
dumping margin was imposed in the most recent administrative
review,12 suggests that Imperial intends to continue dumping
at the recent, higher margins to hold onto or to increase its market
share. Id. Therefore, Hercules urges, the Department should provide to
the Commission the more recent, increased margin, because that margin
is the better indicator of the Imperial's likely behavior in the event
the order is revoked.
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\10\ See footnote 7, supra. Also, according to Hercules'
business proprietary information, the magnitude of Imperial's
increased market share is comparable to its volume increases during
the relevant period.
\11\ To support this, Hercules submits its business manager's
sworn affidavit, in which the business manager indicated an absence
of price increase by Imperial since Imperial's antidumping margin
increased from 1.48 percent to 13.0 percent in March, 1999. (See the
July 1, 1999 Substantive Response of Hercules, attachment 4.)
\12\ See footnote 5, supra. In the most recent administrative
review, the Department assessed Imperial with a higher 13.0 percent
antidumping margin than in the previous review-1.48 percent.
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The Department disagrees with the Hercules' suggestion pertaining
to the margin that is likely to prevail were the order to be revoked.
In the Sunset Policy Bulletin, the Department indicated that when a
company chooses to increase dumping in order to maintain or increase
its market share, the Department may report a more recently calculated
margin to the Commission. (See section II.B.2 of the Sunset Policy
Bulletin.) In the instant case, however, the Department's latest
finding of increased weighted-average dumping margins of the subject
merchandise did not coincide with increased import volumes or increased
market share. In contrast, the largest import volume and highest market
share of the subject merchandise were associated with the lowest
dumping margin.13 Therefore, the Department determines that
it is inappropriate for the Department to report a more recently
calculated rate to the Commission. Instead, because the margins from
the original investigation accurately reflect the behavior of British
producers and exporters without the discipline of an order in place,
the Department will provide to the Commission the margins found in the
original investigation. We will report to the Commission the company-
specific and all-others rate contained in the Final Results of Review
section of this notice.
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\13\ The increases of the import volumes and market shares of
the subject merchandise were simultaneous with a decrease (not
increase) in dumping margins: in its first two administrative
reviews, covering the period 1992 to 1993 and 1993 to 1994 , the
Department reduced the weighted-average dumping margins for the
subject merchandise to 6.62 (the original rate was 11.13) and 1.48,
respectively. The three-year moving average of each of the import
volume and the average market share of the subject merchandise
during 1992-1994, is the highest compared to any other three-year
period (for the market share, the average of 1992-1994 is tied with
that of 1994-1996). See footnote 4 and 5, supra. In other words, and
more importantly, the imposition of a sharply increased antidumping
margin by the Department, for the review period of 1996-1997, did
not result in increased import volume and market share. See Id.
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Final Results of Review
As a result of this review, the Department finds that 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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Imperial Chemical Industries PLC (``Imperial'')............ 11.13
All Others................................................. 11.13
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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: October 21, 1999.
Richard W. Moreland,
Acting Assistant Secretary for Import Administration.
[FR Doc. 99-28065 Filed 10-26-99; 8:45 am]
BILLING CODE 3510-DS-P