[Federal Register Volume 64, Number 243 (Monday, December 20, 1999)]
[Notices]
[Pages 71112-71114]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-32917]



[[Page 71112]]

-----------------------------------------------------------------------

DEPARTMENT OF COMMERCE

International Trade Administration
[A-560-810, A-580-843]


Initiation of Antidumping Duty Investigations: Certain Expandable 
Polystyrene Resins from Indonesia and the Republic of Korea

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

EFFECTIVE DATE: December 20, 1999.

FOR FURTHER INFORMATION CONTACT: Valerie Ellis or Charles Riggle at 
(202) 482-2336 and (202) 482-0650, respectively; Import Administration, 
International Trade Administration, U.S. Department of Commerce, 14th 
Street and Constitution Avenue, NW., Washington, DC 20230.

Initiation of Investigations

The Applicable Statute and Regulations

    Unless otherwise indicated, all citations to the statute are 
references to the provisions effective January 1, 1995, the effective 
date of the amendments made to the Tariff Act of 1930 (``the Act'') by 
the Uruguay Round Agreements Act (``URAA''). In addition, unless 
otherwise indicated, all citations to the Department's regulations are 
references to the provisions codified at 19 CFR Part 351 (1999).

The Petitions

    On November 22, 1999, the Department of Commerce (``the 
Department'') received petitions on certain expandable polystyrene 
resins (``EPS'') from Indonesia and the Republic of Korea (``Korea'') 
filed in proper form by BASF Corporation, Huntsman Expandable Polymers 
Company LC, Nova Chemicals Inc., and Styrochem U.S., Ltd., 
(collectively ``the petitioners''). On December 1 and 3, 1999, the 
Department received amendments to the petitions.
    In accordance with section 732(b) of the Act, the petitioners 
allege that imports of EPS from the above-mentioned countries are 
being, or are likely to be, sold in the United States at less than fair 
value within the meaning of section 731 of the Act, and that such 
imports are materially injuring an industry in the United States.
    The Department finds that the petitioners filed these petitions on 
behalf of the domestic industry because they are interested parties as 
defined in sections 771(9)(C) and (D) of the Act, and they have 
demonstrated sufficient industry support with respect to each of the 
antidumping investigations they are requesting the Department to 
initiate (see Determination of Industry Support for the Petitions, 
below).

Scope of Investigations

    The scope of these investigations includes certain expandable 
polystyrene resins in primary forms; namely, raw material or resin 
manufactured in the form of polystyrene beads, whether of regular 
(shape) type or modified (block) type, regardless of specification, 
having a weighted-average molecular weight of between 160,000 and 
260,000, containing from 3 to 7 percent blowing agents, and having bead 
sizes ranging from 0.4 mm to 3 mm.
    Specifically excluded from the scope of these investigations is 
off-grade, off-specification expandable polystyrene resins.
    The covered merchandise is found in the Harmonized Tariff Schedule 
of the United States (HTSUS) subheading 3903.11.00.00. Although this 
HTSUS subheading is provided for convenience and customs purposes, the 
written description of the merchandise is dispositive.
    During our review of the petitions, we discussed the scope with the 
petitioners to ensure that it accurately reflects the product for which 
the domestic industry is seeking relief. Moreover, as discussed in the 
preamble to the Department's regulations (62 FR 27323), we are setting 
aside a period for parties to raise issues regarding product coverage. 
The Department encourages all parties to submit such comments by 
January 12, 2000. Comments should be addressed to Import 
Administration's Central Records Unit at Room 1870, U.S. Department of 
Commerce, 14th Street and Constitution Avenue, NW, Washington, DC 
20230. The period of scope consultations is intended to provide the 
Department with ample opportunity to consider all comments and consult 
with parties prior to the issuance of the preliminary determinations.

Determination of Industry Support for the Petitions

    Section 732(b)(1) of the Act requires that a petition be filed on 
behalf of the domestic industry. Section 732(c)(4)(A) of the Act 
provides that a petition meets this requirement if the domestic 
producers or workers who support the petition account for: (1) at least 
25 percent of the total production of the domestic like product; and 
(2) more than 50 percent of total production of the domestic like 
product produced by that portion of the industry expressing support 
for, or opposition to, the petition.
    Section 771(4)(A) of the Act defines the ``industry'' as the 
producers of a domestic like product. Thus, to determine whether the 
petition has the requisite industry support, the statute directs the 
Department to look to producers and workers who produce the domestic 
like product. The International Trade Commission (``ITC''), which is 
responsible for determining whether ``the domestic industry'' has been 
injured, must also determine what constitutes a domestic like product 
in order to define the industry. While both the Department and the ITC 
must apply the same statutory definition regarding the domestic like 
product (see section 771(10) of the Act), they do so for different 
purposes and pursuant to separate and distinct authority. In addition, 
the Department's determination is subject to limitations of time and 
information. Although this may result in different definitions of the 
like product, such differences do not render the decision of either 
agency contrary to the law.1
---------------------------------------------------------------------------

    \1\ See Algoma Steel Corp. Ltd., v. United States, 688 F. Supp. 
639, 642-44 (CIT 1988); High Information Content Flat Panel Displays 
and Display Glass from Japan: Final Determination; Rescission of 
Investigation and Partial Dismissal of Petition, 56 FR 32376, 32380-
81 (July 16, 1991).
---------------------------------------------------------------------------

    Section 771(10) of the Act defines the domestic like product as ``a 
product that is like, or in the absence of like, most similar in 
characteristics and uses with, the article subject to an investigation 
under this title.'' Thus, the reference point from which the domestic 
like product analysis begins is ``the article subject to an 
investigation,'' i.e., the class or kind of merchandise to be 
investigated, which normally will be the scope as defined in the 
petition. Moreover, the petitioners do not offer a definition of 
domestic like product distinct from the scope of the investigation.
    In this case, there is one domestic like product, which is defined 
in the ``Scope of Investigations'' section, above. The Department has 
no basis on the record to find the petitioners' definition of the 
domestic like product to be inaccurate. No comments were received on 
this issue. The Department, therefore, has adopted the domestic like 
product definition set forth in the petitions.
    Moreover, the Department has determined that the petitions (and 
subsequent amendments) contain adequate evidence of industry support; 
therefore, polling is unnecessary (see Attachments to Initiation 
Checklist, Re: Industry Support, December 13, 1999). To the best of the 
Department's knowledge, the producers who support the petition account 
for more than 50

[[Page 71113]]

percent of the production of the domestic like product. Additionally, 
no person who would qualify as an interested party pursuant to section 
771(9)(A), (C), (D), (E) or (F) of the Act has expressed opposition on 
the record to the petition. Accordingly, the Department determines that 
this petition is filed on behalf of the domestic industry within the 
meaning of section 732(b)(1) of the Act.

Export Price and Normal Value

    The following are descriptions of the allegations of sales at less 
than fair value upon which the Department's decision to initiate these 
investigations is based.
    The petitioners, in determining normal value (``NV'') for Indonesia 
and Korea relied upon price data contained in confidential market 
research reports filed with the Department. At our request, the 
petitioners arranged for the Department to contact the author of the 
reports to verify the accuracy of the data, the methodology used to 
collect the data, and the credentials of those gathering the market 
research. The Department's discussions with the author of the market 
research reports are summarized in Memorandum to the File: Telephone 
Conversation with Market Research Firm dated December 3, 1999. For a 
more detailed discussion of the deductions and adjustments relating to 
home market price, U.S. price and factors of production and sources of 
data for each country named in the petition, see Initiation Checklist, 
dated December 13, 1999. Should the need arise to use, as facts 
available under section 776 of the Act, any of this information in our 
preliminary or final determinations, we may re-examine the information 
and revise the margin calculations, if appropriate.
Indonesia
    The petitioners identified PT Risjad Brasali Styrindo, PT Polychem 
Lindo, Inc., and PT Maspion Polystyrene as producers and exporters of 
EPS to the United States. For EPS from Indonesia, the petitioners based 
EP on the average unit value (``AUV'') of the merchandise as derived 
from the U.S. government's IM-145 data. The petitioners calculated a 
net U.S. price by subtracting from the AUV estimated costs for foreign 
inland freight derived from data contained in the confidential market 
research report.
    NV is based upon prices for products which are identical to the 
products used as the basis for the U.S. price. The petitioners 
calculated NV by deducting foreign movement charges and domestic 
packing expenses, and adding U.S. packing expenses. The petitioners did 
not adjust normal value for differences in credit expenses because in 
the Indonesian market, the terms and conditions of domestic 
transactions were ``cash in advance.'' The estimated dumping margins 
for EPS from Indonesia range from 94.93 to 96.65 percent.
Korea
    The petitioners identified Kumho Chemicals Co., Ltd.; LG Chemical, 
Ltd., Dongbu Hannong Chemical Co., Shin Ho Petrochemical Co., Ltd., 
Cheil Industries, Inc., and BASF Styrenics Korea, Ltd. as producers and 
exporters of EPS to the United States. For EPS from Korea, the 
petitioners based EP either on the AUV of the merchandise as derived 
from the U.S. government's IM-145 data or on actual invoices to U.S. 
customers and supporting affidavits from U.S. salespersons. They also 
relied on data contained in the confidential market research report 
regarding adjustments and deductions.
    For comparisons using actual invoices and affidavits, the 
petitioners calculated a net U.S. price by subtracting estimated costs 
for selling agent commissions, U.S. inland freight, port charges, 
international shipping charges, customs duties, and foreign inland 
freight. For AUV comparisons, the petitioners deducted foreign market 
inland freight.
    NV is based upon prices for products which are identical to the 
products used as the basis for the U.S. price. The petitioners 
calculated NV by deducting foreign movement charges and domestic 
packing expenses, and adding U.S. packing expenses. The petitioners 
also adjusted normal value for differences in credit expenses. The 
estimated dumping margins for EPS from Korea ranged from 43.79 to 89.39 
percent.

Fair Value Comparisons

    Based on the data provided by the petitioners, there is reason to 
believe that imports of EPS from Indonesia and Korea are being, or are 
likely to be, sold at less than fair value.

Allegations and Evidence of Material Injury and Causation

    The petitions allege that the U.S. industry producing the domestic 
like products is being materially injured, and is threatened with 
material injury, by reason of the individual and cumulated imports of 
the subject merchandise sold at less than NV. The petitioners explained 
that the industry's injured condition is evident in the declining 
trends in (1) U.S. market share, (2) average unit sales values, (3) 
share of domestic consumption, (4) operating income, (5) sales, and (6) 
capacity utilization.
    The allegations of injury and causation are supported by relevant 
evidence including U.S. Bureau of the Census import data, lost sales, 
and pricing information. While the petitioners did not submit 
information on other injurious trends such as a decline in employment, 
hours worked and wages paid, the Department assessed the allegations 
and supporting evidence regarding material injury and causation and 
determined that these allegations are supported by accurate and 
adequate evidence and meet the statutory requirements for initiation 
(see Attachments to Initiation Checklist, Re: Material Injury, December 
13, 1999).

Initiation of Antidumping Investigations

    Based upon our examination of the petitions on EPS from Indonesia 
and Korea, we find that the petitions meet the requirements of section 
732 of the Act. Therefore, we are initiating antidumping duty 
investigations to determine whether imports of EPS from Indonesia and 
Korea are being, or are likely to be, sold in the United States at less 
than fair value. Unless this deadline is extended, we will make our 
preliminary determinations no later than 140 days after the date of 
this initiation.

Distribution of Copies of the Petitions

    In accordance with section 732(b)(3)(A) of the Act, a copy of the 
public version of each petition has been provided to the 
representatives of Indonesia and Korea. We will attempt to provide a 
copy of the public versions of each petition to each exporter named in 
the petition, as appropriate.

ITC Notification

    We have notified the ITC of our initiations, as required by section 
732(d) of the Act.

Preliminary Determinations by the ITC

    The ITC will determine, by no later than January 6, 2000, whether 
there is a reasonable indication that imports of certain expandable 
polystyrene resins from Indonesia and Korea are causing material 
injury, or threatening to cause material injury, to a U.S. industry. A 
negative ITC determination for any country will result in the 
investigation being terminated with respect to that country; otherwise, 
these investigations will proceed according to statutory and regulatory 
time limits.
    This notice is published pursuant to section 777(i) of the Act.


[[Page 71114]]


    Dated: December 13, 1999.
Robert S. LaRussa,
Assistant Secretary for Import Administration.
[FR Doc. 99-32917 Filed 12-17-99; 8:45 am]
BILLING CODE 3510-DS-P