[Federal Register Volume 66, Number 224 (Tuesday, November 20, 2001)]
[Notices]
[Pages 58115-58118]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-29000]


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DEPARTMENT OF COMMERCE

International Trade Administration

[A-570-866]


Notice of Final Determination of Sales at Less Than Fair Value: 
Certain Folding Gift Boxes From the People's Republic of China

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

ACTION: Notice of final determination of sales at less than fair value.

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SUMMARY: On August 6, 2001, the Department of Commerce (the Department) 
published the preliminary results of its investigation of certain 
folding gift boxes from the People's Republic of China. On August 17, 
2001, we published amended preliminary results to correct ministerial 
errors and we postponed our final determination. The products covered 
by this investigation are certain folding gift boxes. The period of 
investigation is July 1, 2000, through December 31, 2000.
    Based on our analysis of comments received and information obtained 
during verification, we have made

[[Page 58116]]

changes to the margin calculations. Therefore, the final results differ 
from the preliminary results.

EFFECTIVE DATE: November 20, 2001.

FOR FURTHER INFORMATION CONTACT: Thomas Schauer or George Callen, 
Import Administration, International Trade Administration, U.S. 
Department of Commerce, 14th Street and Constitution Avenue, NW., 
Washington, DC 20230; telephone: (202) 482-0410 and (202) 482-0180, 
respectively.

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

Final Determination

    We determine that certain folding gift boxes (gift boxes) from the 
People's Republic of China (PRC) are being, or are likely to be, sold 
in the United States at less than fair value (LTFV), as provided in 
section 735 of the Act. The estimated margins of sales at LTFV are 
shown in the ``Final Margin'' section of this notice.

Scope of the Investigation

    The products covered by this investigation are certain folding gift 
boxes. Certain folding gift boxes are a type of folding or knock-down 
carton manufactured from paper or paperboard. Certain folding gift 
boxes are produced from a variety of recycled and virgin paper or 
paperboard materials, including, but not limited to, clay-coated paper 
or paperboard and kraft (bleached or unbleached) paper or paperboard. 
The scope of the investigation excludes gift boxes manufactured from 
paper or paperboard of a thickness of more than 0.8 millimeters, 
corrugated paperboard, or paper mache. The scope of the investigation 
also excludes those gift boxes for which no side of the box, when 
assembled, is at least nine inches in length.
    Certain folding gift boxes are typically decorated with a holiday 
motif using various processes, including printing, embossing, 
debossing, and foil stamping, but may also be plain white or printed 
with a single color. The subject merchandise includes certain folding 
gift boxes, with or without handles, whether finished or unfinished, 
and whether in one-piece or multi-piece configuration. One-piece gift 
boxes are die-cut or otherwise formed so that the top, bottom, and 
sides form a single, contiguous unit. Two-piece gift boxes are those 
with a folded bottom and a folded top as separate pieces. Certain 
folding gift boxes are generally packaged in shrink-wrap, cellophane, 
or other packaging materials, in single or multi-box packs for sale to 
the retail customer. The scope of the investigation excludes folding 
gift boxes that have a retailer's name, logo, trademark or similar 
company information printed prominently on the box's top exterior (such 
folding gift boxes are often known as ``not-for-resale'' gift boxes or 
``give-away'' gift boxes and may be provided by department and 
specialty stores at no charge to their retail customers). The scope of 
the investigation also excludes folding gift boxes where both the 
outside of the box is a single color and the box is not packaged in 
shrink-wrap, cellophane, other resin-based packaging films, or 
paperboard.
    Imports of the subject merchandise are currently classified under 
Harmonized Tariff Schedule of the United States (HTSUS) subheadings 
4819.20.00.40 and 4819.50.40.60. These subheadings also cover products 
that are outside the scope of this investigation. Furthermore, although 
the HTSUS subheadings are provided for convenience and customs 
purposes, our written description of the scope of this investigation is 
dispositive.

Background

    We published in the Federal Register the preliminary determination 
in this investigation on August 6, 2001. See Notice of Preliminary 
Determination of Sales at Less Than Fair Value: Certain Folding Gift 
Boxes From the People's Republic of China, 66 FR 40937 (August 6, 2001) 
(Preliminary Determination). Since the publication of the Preliminary 
Determination, the following events have occurred.
    On August 6, 2001, Max Fortune Industrial Ltd. (Max Fortune) and 
Red Point Paper Products Co., Ltd. (Red Point), respondents in this 
investigation, requested that the Department correct ministerial errors 
they found in their margin calculations. On August 17, 2001, the 
Department determined that the ministerial errors alleged by the 
respondents constituted significant ministerial errors within the 
meaning of 19 CFR 351.224(g)(1) and we made the suggested corrections 
to these companies' margins. Therefore, we published in the Federal 
Register our amended preliminary determination in this investigation on 
August 17, 2001. See Notice of Amended Preliminary Determination of 
Sales at Less Than Fair Value and Postponement of Final Determination: 
Certain Folding Gift Boxes From the People's Republic of China, 66 FR 
43181 (August 17, 2001).
    On August 8, 2001, Red Point requested that the Department postpone 
its final determination until November 12, 2001 (which is not later 
than 135 days after the date of the publication of the preliminary 
determination in the Federal Register), and requested an extension of 
the provisional measures. In accordance with 19 CFR 351.210(b)(2)(ii), 
because (1) our preliminary determination was affirmative; (2) the 
respondent requesting the postponement accounted for a significant 
proportion of exports of the subject merchandise (see Memorandum from 
Laurie Parkhill to Richard W. Moreland dated May 1, 2001); and (3) no 
compelling reasons for denial existed, we granted the respondent's 
request and postponed the final determination. Because November 12, 
2001, is a federal holiday, we postponed the final determination until 
November 13, 2001.
    On August 13 through 17, 2001, the Department conducted a U.S. 
sales data and factors-of-production (FOP) data verification of Max 
Fortune. See Max Fortune verification report dated September 19, 2001. 
On August 20 through 23, 2001, the Department conducted a U.S. sales 
data and FOP data verification of Red Point. See Red Point verification 
report dated September 13, 2001. On September 10, 2001, the Department 
conducted a U.S. sales data verification of The Lindy Bowman Company 
(Lindy Bowman), a U.S. reseller of merchandise produced by Red Point. 
See Lindy Bowman verification report dated September 17, 2001.
    On September 17, 2001, Max Fortune submitted additional surrogate-
value data.
    On October 2, 2001, the petitioners and Red Point submitted their 
case briefs with respect to the sales and FOP verifications and the 
Preliminary Determination. On October 9, 2001, the petitioners and 
respondents submitted rebuttal briefs with respect to the sales and FOP 
verification and the Preliminary Determination. No parties requested a 
hearing.

Period of Investigation

    The period of investigation is July 1, 2000, through December 31, 
2000.

[[Page 58117]]

Non-Market Economy

    The Department has treated the PRC as a non-market economy (NME) 
country in all its past antidumping investigations. See Final 
Determination of Sales at Less Than Fair Value: Bulk Aspirin From the 
People's Republic of China, 65 FR 33805 (May 25, 2000), and Final 
Determination of Sales at Less Than Fair Value: Steel Concrete 
Reinforcing Bars From the People's Republic of China, 66 FR 33522 (June 
22, 2001). A designation as an NME country remains in effect until it 
is revoked by the Department. See section 771(18)(C) of the Act. The 
respondents in this investigation have not requested a revocation of 
the PRC's NME status. Therefore, we have continued to treat the PRC as 
an NME in this investigation. For further details, see the Preliminary 
Determination.

Separate Rates

    In our Preliminary Determination, we found that Max Fortune and Red 
Point had met the criteria for the application of separate antidumping 
duty rates. We saw at verification that both companies are Hong Kong 
companies. We have not received any other information since the 
Preliminary Determination which would warrant reconsideration of our 
separates rates determination with respect to the respondents. 
Therefore, we continue to find that Max Fortune and Red Point should be 
assigned individual dumping margins. For a complete discussion of the 
Department's determination that the respondents are entitled to 
separate rates, see the Preliminary Determination, 66 FR at 40975.

Surrogate Country

    As we found in the Preliminary Determination, for purposes of the 
final determination, we continue to find that India remains the 
appropriate primary surrogate country for the PRC. For further 
discussion and analysis regarding the surrogate country selection for 
the PRC, see the Preliminary Determination.

Use of Facts Available

    We have continued to use adverse facts available in our calculation 
of the PRC-wide rate. We have not changed this rate since the 
Preliminary Determination. See the Preliminary Determination, 66 FR at 
40975. In the Preliminary Determination, we determined that the 
application of total adverse facts available (AFA) was appropriate with 
respect to the PRC-wide entity, as this entity failed to respond to our 
antidumping questionnaire. As AFA, we applied a margin rate of 164.75 
percent, the highest margin alleged in the petition, which we adjusted 
to account for the fact that we used India as the surrogate country 
(the petition used Indonesia). We corroborated the petition information 
to the extent possible. See the memorandum to the file entitled 
Corroboration of Facts Available, dated July 30, 2001. The interested 
parties did not object to the use of AFA for the PRC-wide entity, or to 
our choice of facts available, and no new facts were submitted which 
would cause us to reconsider this decision. Therefore, for the reasons 
set out in the Preliminary Determination, we have continued to use the 
highest margin alleged in the petition, as adjusted, for the purposes 
of this final determination notice.

Analysis of Comments Received

    All issues raised in the case briefs by parties to this 
investigation are addressed in the Decision Memorandum, which is hereby 
adopted by this notice. See the Certain Folding Gift Boxes from the PRC 
Issues and Decision Memorandum dated November 13, 2001 (the Decision 
Memorandum). A list of the issues which parties raised, and to which we 
have responded, all of which are in the Decision Memorandum, is 
attached to this notice as an Appendix. Parties can find a complete 
discussion of all issues raised in this investigation and the 
corresponding recommendations in this public memorandum, which is on 
file in B-099. In addition, a complete version of the Decision 
Memorandum can be accessed directly on the internet at ia.ita.doc.gov. 
The paper copy and electronic version of the Decision Memorandum are 
identical in content.

Changes Since the Preliminary Determination

    Based on our findings at verification and our analysis of comments 
received, we have made adjustments to the calculation methodology in 
calculating the final dumping margins for Max Fortune and Red Point in 
this proceeding. See Final Analysis Memoranda for Max Fortune and Red 
Point dated November 13, 2001. These revisions are:

Red Point

    1. We used the U.S. sales database that Red Point presented at the 
start of verification which incorporates its pre-verification 
corrections.
    2. We deducted the declaration fees that Red Point incurred on U.S. 
sales.
    3. We used the FOP database that Red Point presented at the start 
of verification which incorporates its pre-verification corrections. 
Because Red Point did not include the usage for plastic tabs for 
certain models in its database, we included the usages we verified for 
these models.
    4. We recalculated Red Point's glue usage to account for beginning 
inventory in Red Point's calculation of usage of glue.
    5. We recalculated Red Point's shrink-wrap usage to account for 
beginning inventory in Red Point's calculation of usage of shrink wrap.
    6. We revised Red Point's per-piece shrink-wrap weights to accord 
with the weights we verified.
    7. We revised Red Point's reported carton usage to accord with the 
usage we verified.
    8. We converted Red Point's reported tape usage from a per-meter to 
a per-kilogram basis using a conversion factor based on information in 
the Red Point verification report dated September 13, 2001, at page 12.
    9. We revised Red Point's reported market-economy input costs to 
accord with the costs we verified.
    10. We revised Red Point's electricity usage calculation to include 
the electricity for the foil-stamping or pre-cutting processes.
    11. We revised Red Point's labor usage calculation to accord with 
the labor hours we verified.
    12. We have recalculated the surrogate value for electricity for 
Red Point.

Max Fortune

    1. We used the U.S. sales database that Max Fortune submitted 
August 8, 2001.
    2. We included an unreported billing adjustment for one invoice 
that we found at verification.
    3. We found at verification that Max Fortune reported out-of-scope 
boxes, all of which are printed with the retailer's name. We have 
removed all sales of such boxes from Max Fortune's U.S. sales database.
    4. We found at verification that Max Fortune allocated its movement 
expenses by dividing the expense by the standard weight and multiplying 
this number by the actual weight reported in the response for each 
observation. We corrected this by dividing the reported movement 
expenses by the reported actual weight and multiplying it by the 
standard weight for the model.
    5. We found at verification that the sum of per-unit weight and 
per-unit scrap for each model of boxes incorporating duplex board 
exceeded the per-unit usage of those models. We corrected this by 
reallocating the scrap

[[Page 58118]]

offset to take into account the relative scrap generated by each model.
    6. We found at verification that Max Fortune incorrectly reported 
that it did not incur freight expenses for inputs of glue. We included 
this freight expense when valuing the glue inputs.
    7. We revised the value of Max Fortune's market-economy inputs 
pursuant to the corrections Max Fortune provided at the start of 
verification.

Verification

    As provided in section 782(i) of the Act, we verified the 
information submitted by each respondent for use in our final 
determination. We used standard verification procedures including 
examination of relevant accounting and production records, and original 
source documents provided by the respondents. For changes from the 
Preliminary Determination, as a result of verification, see the 
``Changes Since the Preliminary Determination'' section of this notice, 
above, and Max Fortune's and Red Point's Analysis Memoranda dated 
November 13, 2001.

Continuation of Suspension of Liquidation

    In accordance with section 735(c)(1)(B)(ii) of the Act, we are 
directing the Customs Service to continue to suspend liquidation of all 
entries of subject merchandise from the PRC, except for subject 
merchandise produced and exported by Max Fortune (which has a de 
minimis weighted-average margin), that are entered, or withdrawn from 
warehouses, for consumption on or after the date of publication of the 
final determination in the Federal Register. The Customs Service shall 
continue to require a cash deposit or posting of a bond equal to the 
estimated amount by which the normal value exceeds the U.S. price as 
shown below. This suspension of liquidation instruction will remain in 
effect until further notice.
    The weighted-average dumping margins are as follows:

------------------------------------------------------------------------
                                                              Weighted-
                                                               average
                   Exporter/manufacturer                       percent
                                                                margin
------------------------------------------------------------------------
Red Point Paper Products Co., Ltd..........................         9.26
Max Fortune Industrial Ltd.................................         1.67
PRC-wide Rate..............................................       164.75
------------------------------------------------------------------------

    The PRC-wide rate applies to all entries of the subject merchandise 
except for entries from exporters/producers that are identified 
individually above.

ITC Notification

    In accordance with section 735(d) of the Act, we have notified the 
International Trade Commission (ITC) of our determination. As our final 
determination is affirmative, the ITC will, within 45 days, determine 
whether these imports are materially injuring, or threaten material 
injury to, the U.S. industry. If the ITC determines that material 
injury, or a threat of material injury does not exist, the proceeding 
will be terminated and all securities posted will be refunded or 
canceled. If the ITC determines that such injury does exist, the 
Department will issue an antidumping duty order directing Customs 
officials to assess antidumping duties on all imports of the subject 
merchandise entered for consumption on or after the effective date of 
the suspension of liquidation.
    This determination is issued and published in accordance with 
sections 735(d) and 777(i)(1) of the Act.

    Dated: November 13, 2001.
Faryar Shirzad,
Assistant Secretary for Import Administration.

Appendix

I. Changes From the Preliminary Determination

II. Company Specific Issues

Comment 1: Use of Facts Available for Max Fortune
Comment 2: Use of Facts Available for Red Point
Comment 3: Red Point Paperboard Prices
Comment 4: Red Point and Lindy Bowman Affiliation
Comment 5: Red Point Selling, General, and Administrative Expenses 
and Profit
Comment 6: Red Point Electricity Valuation

[FR Doc. 01-29000 Filed 11-19-01; 8:45 am]
BILLING CODE 3510-DS-P