[Federal Register Volume 65, Number 5 (Friday, January 7, 2000)]
[Notices]
[Pages 1136-1139]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-397]
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DEPARTMENT OF COMMERCE
International Trade Administration
[A-570-506]
Porcelain-on-Steel Cooking Ware From the People's Republic of
China; Preliminary Results of Antidumping Duty Administrative Review
AGENCY: Import Administration, International Trade Administration,
Department of Commerce.
ACTION: Notice of preliminary results of antidumping duty
administrative review.
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SUMMARY: The Department of Commerce (``the Department'') is conducting
an administrative review of the antidumping duty order on Porcelain-on-
Steel (``POS'') Cooking Ware from the People's Republic of China
(``PRC'') in response to a request by the petitioner. The review covers
one manufacturer/exporter of the subject merchandise, Clover Enamelware
Enterprise, Ltd. of China (``Clover''), and its Hong Kong reseller,
Lucky Enamelware Factory Ltd. (``Lucky''). The period of review
(``POR'') is December 1, 1997 through November 30, 1998.
We have preliminarily determined that U.S. sales of subject
merchandise by Clover and Lucky have not been made below normal value
(hereinafter referred to as Clover/Lucky). Since Clover/Lucky submitted
full responses to the antidumping questionnaire and it has been
established that it is sufficiently independent, it is entitled to a
separate rate. If these preliminary results are adopted in our final
results of administrative review, we will instruct the U.S. Customs
Service to assess no antidumping duties on entries from Clover/Lucky
during the POR.
Interested parties are invited to comment on these preliminary
results.
EFFECTIVE DATE: January 7, 2000.
FOR FURTHER INFORMATION CONTACT: Russell Morris, Office of AD/CVD
Enforcement VI, Group II, Import Administration, International Trade
Administration, U.S. Department of Commerce, 14th Street and
Constitution Avenue N.W., Washington D.C. 20230; telephone: (202) 482-
1775.
SUPPLEMENTARY INFORMATION:
Applicable Statute
Unless otherwise indicated, all citations to the Tariff Act of
1930, as amended (``the Act''), are references to the provisions
effective 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 citations to the Department's
regulations are to the regulations at 19 CFR Part 351 (1999).
Background
On December 2, 1986, the Department published in the Federal
Register the antidumping duty order on POS cooking ware from the PRC
(51 FR 43414). On December 8, 1998, the Department published in the
Federal Register a notice of opportunity to request an administrative
review of this antidumping duty order (63 FR 67646). On December 30,
1998, in accordance with 19 CFR 351.213(b), the petitioner, Columbian
Home Products, LLC, requested that the Department conduct an
administrative review of Clover, a manufacturer/exporter, and its Hong
Kong reseller Lucky. On January 25, 1999, we published the notice of
initiation of this review covering the period December 1, 1997 through
November 30, 1998 (64 FR 3682).
Under section 751(a)(3)(A) of the Act, the Department may extend
the deadline for issuing a preliminary determination in an
administrative review if it determines that it is not practicable to
complete the preliminary review within the statutory time limit of 245
days. On August 25, 1999, the
[[Page 1137]]
Department published a notice of extension of the time limit for the
preliminary results in this case to December 31, 1999 (64 FR 46349).
The Department is conducting this administrative review in accordance
with section 751(a) of the Act.
Scope of the Review
Imports covered by this review are shipments of POS cooking ware,
including tea kettles, which do not have self-contained electric
heating elements. All of the foregoing are constructed of steel and are
enameled or glazed with vitreous glasses. The merchandise is currently
classifiable under the Harmonized Tariff Schedule (``HTS'') item
7323.94.00. HTS items numbers are provided for convenience and Customs
purposes. The written description of the scope remains dispositive.
Affiliated Parties
Clover is two-thirds owned by Lucky and, therefore, Lucky holds
controlling interest in Clover. Due to Lucky's ownership interest in
Clover, and the fact that the same individual is the general manager at
both companies, we consider Clover and Lucky to be affiliated parties
pursuant to section 771(33) of the Act. As such, and consistent with
prior reviews of this order, we are assigning Clover/Lucky a single
dumping margin. See Porcelain-on-Steel Cooking Ware from the People's
Republic of China: Final Results of Antidumping Administrative Review
(``POS Final 1997''); 62 FR 32758 (June 17, 1997). No new information
or evidence of changed circumstances has been submitted in this
proceeding to warrant reconsideration of this finding.
Separate Rates
It is the Department's policy to assign all exporters of the
merchandise subject to review in non-market-economy (``NME'') countries
a single rate, unless an exporter can demonstrate an absence of
government control, both in law (de jure) and in fact (de facto), with
respect to exports. To establish whether an exporter is sufficiently
independent of government control to be entitled to a separate rate,
the Department analyzes the exporter in light of the criteria
established in the Final Determination of Sales at Less Than Fair
Value: Sparklers from the People's Republic of China (``Sparklers''),
56 FR 20588 (May 6, 1991), as amplified in the Final Determination of
Sales at Less Than Fair Value: Silicon Carbide from the People's
Republic of China (``Silicon Carbide''), 59 FR 22585 (May 2, 1994).
Evidence supporting, though not requiring, a finding of de jure absence
of government control over export activities includes:
(1) An absence of restrictive stipulations associated with an
individual exporter's business and export licenses; (2) any legislative
enactments decentralizing control of companies; and (3) any other
formal measures by the government decentralizing control of companies.
Evidence relevant to a de facto absence of government control with
respect to exports is based on four factors, whether the respondent:
(1) Sets its own export prices independent from the government and
other exporters; (2) can retain the proceeds from its export sales; (3)
has the authority to negotiate and sign contracts; and (4) has autonomy
from the government regarding the selection of management. See Silicon
Carbide, 59 FR at 22585, 22587; see also, Sparklers, 56 FR at 20588,
20589.
Clover/Lucky responded to the Department's request for information
regarding separate rates by providing the requested documentation. We
have determined that the evidence on the record demonstrates an absence
of government control, both in law and in fact, with respect to Clover/
Lucky's exports, in accordance with the criteria identified in
Sparklers and Silicon Carbide. For further information, see Memorandum,
``Separate Rates in the 1997/1998 Administrative Review of Porcelain-
on-Steel Cooking Ware from the People's Republic of China,'' dated the
same date of this notice, which is on file in our Central Records Unit,
room B-099 in the main Commerce building. As a result of our analysis,
Clover/Lucky is entitled to a separate rate.
Export Price
The Department used export price (``EP'') for sales made by Clover/
Lucky, in accordance with section 772(a) of the Act, because the
subject merchandise was sold to unaffiliated purchasers in the United
States, or Hong Kong (in cases where Clover/Lucky knew the ultimate
destination was the United States), prior to importation into the
United States and constructed export price is not otherwise indicated.
We calculated EP based on Lucky's price charged to unaffiliated
purchasers in the United States. We deducted amounts, where
appropriate, for discounts, brokerage and handling, foreign inland
freight, ocean freight, export credit insurance, and marine insurance,
which were provided by market economy carriers and paid for in market
economy currencies. Moreover, we deducted the reported import and
export declarations fees. See POS Final 1997.
Normal Value
Section 773(c)(1) of the Act provides that the Department shall
determine the normal value (``NV'') using a factors-of-production
methodology if: (1) The merchandise is exported from an NME country;
and (2) the information does not permit the calculation of NV using
home-market prices, third-country prices, or constructed value under
section 773(a) of the Act.
The Department has treated the PRC as an NME country in all
previous antidumping cases. In accordance with section 771(18)(C)(i) of
the Act, any determination that a foreign country is an NME country
shall remain in effect until revoked by the administering authority.
None of the parties to this proceeding has contested such treatment in
this review. Therefore, we treated the PRC as an NME country for
purposes of this review. Furthermore, available information does not
permit the calculation of NV using home market prices, third country
prices, or constructed value under section 773(a) of the Act. As a
result, we calculated NV by valuing the factors of production in a
comparable market economy country which is a significant producer of
comparable merchandise.
Section 773(c)(4) of the Act and 19 CFR 351.408 direct us to select
a surrogate country that is economically comparable to the PRC. On the
basis of per capita gross domestic product (``GDP''), the growth rate
in per capita GDP, and the national distribution of labor, we find that
the Republic of Indonesia (``Indonesia'') is a comparable economy to
the PRC. (See Memorandum to David Mueller, Director, Office of AD/CVD
Enforcement VI from Jeff May, Director, Office of Policy, dated May 21,
1999, ``Porcelain-on-Steel Cooking Ware from the People's Republic of
China, Non-Market Economy Status and Surrogate Country Selection'' on
file in the Central Records Unit.)
Section 773(c)(4) of the Act also requires that, to the extent
possible, the Department use a surrogate country that is a significant
producer of merchandise comparable to POS cooking ware. For purposes of
this administrative review, we find that Indonesia is a significant
producer of POS cooking ware. See Memorandum to the File from Russell
Morris, dated June 7, 1999, ``Porcelain-on Steel Cooking Ware from the
People's Republic of China--Surrogate Country Selection,'' on file in
the Central Records Unit. As a result, we have used publicly available
information relating to Indonesia, unless
[[Page 1138]]
otherwise noted, to value the various factors of production.
For purposes of calculating NV, we valued PRC factors of
production, in accordance with section 773(c)(1) of the Act. Factors of
production include, but are not limited to: hours of labor employed;
quantities of raw materials required; amounts of energy and other
utilities consumed; and representative capital cost, including
depreciation. In examining surrogate values, we selected, where
possible, the publicly available value which was: an average non-export
value; representative of a range of prices within the POR or most
contemporaneous with the POR; product-specific; and tax-exclusive. For
a more detailed explanation of the methodology used in calculating
various surrogate values, see ``Margin Calculation and Factor Values
Used for the Preliminary Results of the 1997-1998 Administrative Review
of POS Cooking Ware from the PRC'' (Public Version) which is dated the
same date of this notice, on file in the Central Records Unit. In
accordance with this methodology, we valued the factors of production
as follows:
To value the surrogate values of materials used in the
production of POS cooking ware, including bentonite, caustic soda,
potassium chloride, titanium and antimony oxides, sodium nitrite, soda
ash, sulphuric acid, degreasing agents, borax, barium molybdate,
magnesium sulphate, potassium carbonate, urea, quartz powder, clay,
color oxides, enamel frits, pebble stone, and diesel, we relied on
cost-insurance-freight (``CIF'') import prices, quoted in U.S. dollars,
contained in the August 1998 issue of the Foreign Trade Statistical
Bulletin--Imports, (Indonesian Import Statistics). We made adjustments
to account for freight costs between the suppliers and Clover's
manufacturing facilities. In accordance with our practice, we added to
CIF import values from Indonesia a surrogate freight cost using the
shorter of the reported distances from either the closest PRC port to
the factory, or from the domestic supplier to the factory. See Final
Determination of Sales at Less Than Fair Value: Certain Cut-to-Length
Carbon Steel Plate From the People's Republic of China, 62 FR 61977
(November 20, 1997).
We valued labor based on a regression-based wage rate, in
accordance with 19 CFR 351.408(c)(3). See Import Administration's home
page, Import Library, Expected Wages of Selected NME Countries, revised
May 1999 (www.ita.doc.gov/import__admin/records/wages). The source of
these wage rate data on the Import Administration's Web site is found
in the 1998 Year Book of Labour Statistics, International Labour Office
(Geneva: 1998), Chapter 5: Wages in Manufacturing.
For electricity, we used an index of electricity prices
used in previous antidumping duty investigations involving products
from the PRC. This index is current as of April 1997. See
www.ita.doc.gov/import__admin/records/factorv/prc/#Source Index.
Because the value was not contemporaneous with the POR, we adjusted for
inflation using the wholesale price indices (``WPI'') which excluded
petroleum, obtained from the International Financial Statistics
published by the International Monetary Fund (``IMF''). We adjusted the
value to reflect inflation up to the POR using the WPI published by the
IMF. Further, we converted the electrical price quoted in Indonesian
Rupiah (``Rupiah'') to U.S. dollars using the average exchange rate for
the POR of Rupiah to U.S. dollars.
For foreign inland freight, we used the freight rates
reported in a September 1991 cable from the U.S. Embassy in Jakarta,
Indonesia and the actual kilometers reported in the questionnaire
response. The cable was received for the less than fair value
(``LTFV'') investigation of Pipe Fittings. See Final Determination of
Sales at Less Than Fair Value: Certain Carbon Steel Butt-Weld Pipe
Fittings from the People's Republic of China (``Pipe Fittings''), 57 FR
21058 (May 18, 1992). We adjusted these freight rates to reflect yearly
inflation through the POR using the WPI obtained by the IMF. We used
the average exchange rate for the POR to convert surrogate values from
Rupiah to U.S. dollars.
To value water, we relied upon public information from the
October 1997 Second Water Utilities Data Book: Asian and Pacific
Region, published by the Asian Development Bank. To achieve
comparability of the water prices to the factors reported for the POS
cooking ware processing periods applicable for Clover/Lucky, we
adjusted this factor value for inflation using the WPI for Indonesia,
as published by the IMF, and converting the quoted price from Rupiah to
U.S. dollars by applying the average Rupiah to U.S. dollar exchange
rate for the POR.
We derived ratios for factory overhead, selling, general
and administrative (``SG&A'') expenses, and profit using an index of
such expenses from previous antidumping duty investigations involving
products from the PRC. The ratios were derived from a similar industry,
melamine institutional dinnerware, and from the same surrogate country,
Indonesia. This index is current as of April 1997. See www.ita.doc.gov/
import__admin/records/factorv/prc/#Source Index. From this information,
we were able to calculate factory overhead as a percentage of direct
material, labor, and energy expenses; SG&A as a percentage of the total
cost of manufacturing; and profit as a percentage of the sum of the
total cost of manufacturing and SG&A.
To value cardboard boxes and tissue paper, we relied upon
Indonesian import data from the August 1998 issue of the Foreign Trade
Statistical Bulletin--Imports, (Indonesian Import Statistics). We
adjusted the values of packing materials to include freight costs
incurred between the supplier and the factory.
Preliminary Results of the Review
We preliminarily determine that the following margins exist for the
period December 1, 1997 through November 30, 1998:
------------------------------------------------------------------------
Margin
Manufacturer/Exporter (percent)
------------------------------------------------------------------------
Clover Enamelware Enterprise/Lucky Enamelware Factory...... 0.00
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Pursuant to 19 CFR 351.224(b), the Department will disclose to
parties to the proceeding any calculations performed in connection with
these preliminary results within five (5) days after the date of
publication of this notice.
Interested parties may request a hearing within 30 days of
publication of this notice. See 19 CFR 351.310(c). Interested parties
may submit case briefs within 30 days of publication. Rebuttal briefs,
limited to issues raised in the case briefs, may be filed no later than
35 days after the date of publication. Parties who submit case briefs
or rebuttal briefs in this proceeding are requested to submit with each
argument: (1) A statement of the issue, and (2) a brief summary of the
argument. Parties are also encouraged to provide a summary of the
arguments not to exceed five pages and a table of statutes,
regulations, and cases cited. The Department will issue the final
results of this administrative review, including its analysis of issues
raised in any case or rebuttal brief or at a hearing, not later than
120 days after the date of publication of this notice, unless the time
limits is extended.
The Department shall determine, and the Customs Service shall
assess, antidumping duties on all appropriate entries. Upon completion
of this review, the Department will issue appraisement
[[Page 1139]]
instructions directly to the U.S. Customs Service.
Furthermore, the following deposit requirements will be effective
upon publication of the final results of this antidumping duty
administrative review for all shipments of the subject merchandise
entered, or withdrawn from warehouse, for consumption on or after the
publication date, as provided by section 751(a)(1) of the Act: (1) For
Clover/Lucky, which has a separate rate, the cash deposit rate will be
zero; (2) for any previously reviewed PRC firm and non-PRC exporter
with a separate rate, the cash deposit rate will be the company-and
product-specific rate established for the most recent period; (3) the
cash deposit rate for all other PRC exporters will continue to be 66.65
percent, the PRC-wide rate established in the LTFV investigation; and
(4) the cash deposit rate for non-PRC exporters of subject merchandise
from the PRC will be the rate applicable to the PRC supplier of that
exporter. These requirements, when imposed, shall remain in effect
until publication of the final results of the next administrative
review.
This notice serves as a preliminary reminder to importers of their
responsibility under 19 CFR 351.402(f) to file a certificate regarding
the reimbursement of antidumping duties prior to liquidation of the
relevant entries during this review period. Failure to comply with this
requirement could result in the Secretary's presumption that
reimbursement of antidumping duties occurred and the subsequent
assessment of double antidumping duties.
This administrative review is issued and published in accordance
with sections 751(a)(1) and 777(i)(1) of the Act.
Dated: January 3, 2000.
Richard W. Moreland,
Acting Assistant Secretary for Import Administration.
[FR Doc. 00-397 Filed 1-6-00; 8:45 am]
BILLING CODE 3510-DS-P