[Federal Register Volume 66, Number 62 (Friday, March 30, 2001)]
[Notices]
[Pages 17408-17410]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-7928]


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

DEPARTMENT OF COMMERCE

International Trade Administration

[A-533-822]


Initiation of Antidumping Duty Investigation: Oleoresin Paprika 
From India

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

EFFECTIVE DATE: March 30, 2001.

FOR FURTHER INFORMATION CONTACT: Mark Ross or Karin Ryerson, Import 
Administration, International Trade Administration, U.S. Department of 
Commerce, 14th Street and Constitution Avenue, NW., Washington, DC 
20230; telephone: (202) 482-4794 or (202) 482-3174, respectively.

SUPPLEMENTARY INFORMATION:

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 Department of Commerce's (the Department's) 
regulations are to the provisions at 19 CFR Part 351 (2000).

The Petition

    On March 6, 2001, the Department received a petition on imports of 
oleoresin paprika filed in proper form by Rezolex, Ltd., Co. (referred 
to hereafter as ``the petitioner''). On March 14, 2001, the Department 
requested additional information and clarification of certain areas of 
the petition and received a response on March 19, 2001.
    In accordance with section 732(b) of the Act, the petitioner 
alleges that imports of oleoresin paprika from India 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 and threaten to injure an industry in the United 
States.
    The Department finds that the petitioner filed this petition on 
behalf of the domestic industry because it is an interested party as 
defined in section 771(9)(C) of the Act. Furthermore, the petitioner 
has demonstrated sufficient industry support with respect to the 
antidumping duty investigation it is requesting the Department to 
initiate (see ``Determination of Industry Support for the Petition'' 
below).

Scope of Investigation

    The merchandise subject to this investigation consists of oleoresin 
extracts made from red peppers (generally known as ``oleoresin 
paprika''), regardless of solvent content or pepper pungency. Other 
names that refer to this product may include, but are not limited to, 
paprika oleoresin, oleoresin of paprika, paprika extract, extract of 
paprika, and ``ORP.'' Manufacturers typically produce oleoresin paprika 
from the pepper variety called Capsicum Annum L., but they may produce 
oleoresin paprika from other red pepper varieties. Except as specified 
below, all products, concentrations, and qualities of oleoresin paprika 
regardless of pepper source are included in this investigation.
    The merchandise subject to this investigation may enter under 
1301.90.9090, 1302.19.9040, 3203.00.8000, 3205.00.0500, 3301.90.1010, 
3301.90.1050, and 3301.90.5000 of the Harmonized Tariff Schedule of the 
United States (HTSUS), but these subheadings also cover products that 
are outside the scope of this investigation. Specifically excluded from 
the scope of this investigation are any oleoresin extracts of red 
peppers that have an American Spice Trade Association (ASTA) value of 
less than 500 ASTA or 20,000 Color Units (500 ASTA  x  40 = 20,000 
Color Units) as determined by spectrophotometric measurement. Although 
the HTSUS subheadings are provided for convenience and customs 
purposes, our written description of the scope of this investigation is 
dispositive.
    During our review of the petition, we discussed the scope with the 
petitioner to ensure that it accurately reflects the products for which 
the domestic industry is seeking relief. Moreover, as discussed in the 
preamble to the Department's regulations (62 FR 27296, 27323), we are 
setting aside a period for interested parties to raise issues regarding 
product coverage. The Department encourages all interested parties to 
submit such comments within 20 calendar days of publication of this 
notice. 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 determination.

Determination of Industry Support for the Petition

    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 the production of the domestic like product 
produced by that portion of the industry expressing support for, or 
opposition to, the petition.
    Section 732(c)(4)(D) of the Act provides that, if the petition does 
not establish support of domestic producers or workers accounting for 
more than 50 percent of the total production of the domestic like 
product, the administering agency shall: (i) poll the industry or rely 
on other information in order to determine if there is support for the 
petition as required by subparagraph (A), or (ii) determine industry 
support using a statistically valid sampling method.
    Section 771(4)(A) of the Act defines the ``industry'' as the 
producers as a whole 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

[[Page 17409]]

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 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 domestic like product, such 
differences do not render the decision of either agency contrary to 
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 which 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.
    In this case, we have adopted the definition of the domestic like 
product defined in the ``Scope of Investigation'' section, above. That 
definition was developed in consultation with the petitioner.
    The petitioner established industry support representing over 50 
percent of total production of the domestic like product. In addition, 
the Department received no opposition to the petition. Therefore, the 
domestic producers or workers who support the petition account for at 
least 25 percent of the total production of the domestic like product, 
and the requirements of section 732(c)(4)(A)(i) are met. Furthermore, 
the domestic producers or workers who support the petition account for 
more than 50 percent of the production of the domestic like product 
produced by that portion of the industry expressing support for or 
opposition to the petition. Thus, the requirements of section 
732(c)(4)(A)(ii) are also met.
    Accordingly, the Department determines that the petition was filed 
on behalf of the domestic industry within the meaning of section 
732(b)(1) of the Act (see Initiation Checklist, Re: Industry Support).

Export Price and Normal Value

    The following is a description of the allegation of sales at less 
than fair value upon which the Department based its decision to 
initiate this investigation. The sources of data for the deductions and 
adjustments relating to U.S. price and normal value are discussed in 
the Initiation Checklist. Should the need arise to use any of this 
information as facts available under section 776 of the Act, we may 
reexamine the information and revise the margin calculations, if 
appropriate. The anticipated period of investigation is January 1, 
2000, through December 31, 2000.
    The petitioner identified the following Indian companies as 
producers of oleoresin paprika in its petition: Akay Flavours & 
Aromatics, Ltd., Asian Herbex, Ltd., D.V. Deo, Enjay Marketing Services 
Pvt., Ltd., Enjayes Spices & Chemical Oils, Ltd., Flavours and Essences 
Pvt., Ltd., Gujarat Packaging, Indoworld Trading Corporation, Kancor 
Flavours & Extracts Ltd., Paprika Oleo's (India), Ltd., Plant Lipids 
Ltd., and Synthite Industrial Chemicals Ltd. The petitioner determined 
export prices for some of these producers based on price quotes 
obtained by company personnel. All U.S. prices were denominated in U.S. 
dollars and, where appropriate, the petitioner made adjustments for 
movement expenses. To support the accuracy of this information the 
petitioner provided an affidavit from the company official that was 
responsible for collecting the information. As a result of our review 
of the petitioner's calculation of certain export prices, we determined 
that it was necessary to revise certain adjustments for movement 
expenses (see Initiation Checklist, Re: Less-Than-Fair-Value 
Allegation).
    With respect to normal value, the petitioner stated that it could 
not find data regarding Indian home-market or third-country prices. In 
support of its claim that home-market and third-country pricing 
information is unavailable, the petitioner provided an affidavit from 
the company official that was responsible for preparing the petition. 
Lacking Indian home-market or third-country pricing information, the 
petitioner based normal value on constructed value. Pursuant to section 
773(e) of the Act constructed value includes cost of materials and 
fabrication, selling, general, and administrative expenses, packing, 
and profit. The petitioner calculated the cost of materials and 
fabrication, selling, general, and administrative expense, and packing 
components of constructed value based on its own production experience, 
using publicly available data to make adjustments for known differences 
between costs incurred to produce oleoresin paprika in the United 
States and India. For profit, the petitioner relied upon the financial 
statements of an Indian oleoresin paprika producer.

Fair Value Comparison

    Based on the data provided by the petitioner, there is reason to 
believe that imports of oleoresin paprika from India are being, or are 
likely to be, sold in the United States at less than fair value. As a 
result of the comparison of export prices to normal value, we 
recalculated estimated dumping margins for imports of oleoresin paprika 
from India that range from 22.29 percent to 46.75 percent.

Allegations and Evidence of Material Injury and Causation

    The petition alleges that the U.S. industry producing the domestic 
like product is being materially injured and is threatened with 
material injury by reason of the imports of the subject merchandise 
sold at less than normal value. The petitioner contends that the 
industry's injured condition is evidenced by the loss of customers, 
producers leaving the industry, stagnate domestic sales volumes, and 
declining trends in employment and pricing.
    The allegations of injury and causation are supported by relevant 
evidence including U.S. Customs import data, lost sales, and pricing 
information. 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 Initiation 
Checklist, Re: Material Injury).

Initiation of Antidumping Investigation

    Based upon our examination of the petition on oleoresin paprika 
from India, we find that the petition meets the requirements of section 
732 of the Act. Therefore, we are initiating an antidumping duty 
investigation to determine whether imports of oleoresin paprika from 
India are being, or are likely to be, sold in the United States at less 
than fair value. Unless postponed, we will make our preliminary 
determination no later than 140 days after the date of this initiation.

Distribution of Copies of the Petition

    In accordance with section 732(b)(3)(A) of the Act, a copy of the 
public version of the petition has been provided to the representatives 
of the

[[Page 17410]]

government of India. We will attempt to provide a copy of the public 
version of the petition to each producer named in the petition, as 
appropriate.

International Trade Commission Notification

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

Preliminary Determination by the ITC

    The ITC will preliminarily determine, no later than April 20, 2001, 
whether there is a reasonable indication that imports of oleoresin 
paprika are causing material injury, or threatening to cause material 
injury, to a U.S. industry. A negative ITC determination will result in 
this investigation being terminated; otherwise, this investigation will 
proceed according to statutory and regulatory time limits.
    This notice is published pursuant to section 777(i) of the Act. 
Effective January 20, 2001, Bernard T. Carreau is fulfilling the duties 
of the Assistant Secretary for Import Administration.

    Dated: March 26, 2001.
Bernard T. Carreau,
Deputy Assistant Secretary, Import Administration.
[FR Doc. 01-7928 Filed 3-29-01; 8:45 am]
BILLING CODE 3510-DS-P