[Federal Register Volume 67, Number 190 (Tuesday, October 1, 2002)]
[Notices]
[Pages 61591-61595]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-24928]


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DEPARTMENT OF COMMERCE

International Trade Administration

[A-428-836, A-588-861, A-570-879, A-580-850, A-559-807]


Notice of Initiation of Antidumping Duty Investigations: 
Polyvinyl Alcohol From Germany, Japan, the People's Republic of China, 
the Republic of Korea, and Singapore

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

ACTION: Initiation of antidumping duty investigations.

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EFFECTIVE DATE: October 1, 2002.

FOR FURTHER INFORMATION CONTACT: David Goldberger (Singapore, Republic 
of Korea) at (202) 482-4136, and Michael Strollo (Germany, Japan, the 
People's Republic of China) at (202) 482-0629, 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 of Commerce's 
(``the Department's'') regulations are references to the provisions 
codified at 19 CFR part 351 (2002).

The Petitions

    On September 5, 2002, the Department received petitions filed in 
proper form by Celanese Chemicals Ltd. and E.I. Dupont de Nemours & Co. 
(collectively, ``the petitioners''). The Department received 
supplemental information to the petitions from September 16 through 20, 
2002.
    In accordance with section 732(b)(1) of the Act, the petitioners 
allege that imports of polyvinyl alcohol (``PVA'') from Germany, Japan, 
the People's Republic of China (``the PRC''), the Republic of Korea 
(``Korea''), and Singapore are, 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 imports from Germany, Japan, Korea and the PRC, are 
materially injuring, or are threatening to materially injure an 
industry in the United States.\1\
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    \1\ We note that the petitioners have only alleged that imports 
from Singapore are threatending to materially injure an industry in 
the United States.
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    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) of the Act and they have demonstrated 
sufficient industry support with respect to each of the antidumping 
investigations that they are requesting the Department to initiate. See 
infra, ``Determination of Industry Support for the Petitions.''

Scope of Investigations

    The merchandise covered by these investigations is polyvinyl 
alcohol. This product consists of all polyvinyl alcohol hydrolyzed in 
excess of 80 percent, whether or not mixed or diluted with commercial 
levels of defoamer or boric acid. Polyvinyl alcohol in fiber form is 
not included in the scope of these investigations. The merchandise 
under investigation is currently classifiable under subheading 
3905.30.00 of the Harmonized Tariff Schedule of the United States 
(``HTSUS''). Although the HTSUS subheading is provided for convenience 
and customs purposes, the written description of the merchandise under 
investigation is dispositive.
    As discussed in the preamble to the Department's regulations 
(Antidumping Duties; Countervailing Duties; Final Rule, 62 FR 27296, 
27323 (May 19, 1997)), we are setting aside a period for parties to 
raise issues regarding product coverage. The Department encourages all 
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, 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 the Department's industry support determination, which is 
to be made before the initiation of the investigation, be based on 
whether a minimum percentage of the relevant industry supports the 
petition. A petition meets this requirement if the domestic

[[Page 61592]]

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. Moreover, 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 Department shall either 
poll the industry or rely on other information in order to determine if 
there is support for the petition.
    Section 771(4)(A) of the Act defines the ``industry'' as the 
producers of a domestic like product. Thus, to determine whether a 
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 (section 771(10) of the Act), they do so for different purposes 
and pursuant to a 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.\2\
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    \2\ 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).
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    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.
    We reviewed the description of the domestic like product presented 
in the petitions. Based upon our review of the petitioners' claims, we 
concur that there is a single domestic like product, which is defined 
in the ``Scope of Investigations'' section above. This is consistent 
with the Department's determinations in past investigations to treat 
all PVA products as a single class or kind of merchandise. See, e.g., 
Notice of Antidumping Orders: Polyvinyl Alcohol From Japan, the 
People's Republic of China, and Taiwan, 61 FR 24286 (May 14, 1996).
    Finally, the Department has determined that, pursuant to section 
732(c)(4)(A) of the Act, the petitions contain adequate evidence of 
industry support and, therefore, polling is unnecessary. See the Import 
Administration Antidumping Investigations Initiation Checklist, 
Industry Support section, September 25, 2002 (the ``Initiation 
Checklist''), on file in the Central Records Unit, Room B-099 of the 
main Department of Commerce building.
    For all countries, we determined that the petitioners have 
demonstrated industry support representing over 50 percent of total 
production of the domestic like product. Therefore, the domestic 
producers or workers who support the petitions 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) of the Act are met. 
Furthermore, because the Department received no opposition to the 
petitions, the domestic producers or workers who support the petitions 
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 petitions. Thus, the requirements of section 
732(c)(4)(A)(ii) are also met. Accordingly, we determine that these 
petitions are filed on behalf of the domestic industry within the 
meaning of section 732(b)(1) of the Act.

Initiation Standard for Cost Investigations

    Pursuant to section 773(b) of the Act, the petitioners provided 
information demonstrating reasonable grounds to believe or suspect that 
sales in the home markets of Germany, Japan, Korea, and Singapore were 
made at prices below the cost of production (``COP'') and, accordingly, 
requested that the Department conduct country-wide sales-below-COP 
investigations in connection with these investigations. The Statement 
of Administrative Action (``SAA''), submitted to the Congress in 
connection with the interpretation and application of the URAA, states 
that an allegation of sales below COP need not be specific to 
individual exporters or producers. SAA, H.R. Doc. No. 103-316 at 833 
(1994). The SAA, at 833, states that ``Commerce will consider 
allegations of below-cost sales in the aggregate for a foreign country, 
just as Commerce currently considers allegations of sales at less than 
fair value on a country-wide basis for purposes of initiating an 
antidumping investigation.''
    Further, the SAA provides that section 773(b)(2)(A) of the Act 
retains the requirement that the Department have ``reasonable grounds 
to believe or suspect'' that below-cost sales have occurred before 
initiating such an investigation. Reasonable grounds exist when an 
interested party provides specific factual information on costs and 
prices, observed or constructed, indicating that sales in the foreign 
market in question are at below-cost prices. Id. We have analyzed the 
country-specific allegations as described below.

Export Price and Normal Value

    The following are descriptions of the allegations of sales at less 
than fair value upon which the Department based its decision to 
initiate these investigations. The sources of data for the deductions 
and adjustments relating to U.S. and home market prices, constructed 
value (``CV''), and factors of production are discussed in greater 
detail in the Initiation Checklist. Should the need arise to use any of 
this information as facts available under section 776 of the Act in our 
preliminary or final determinations, we may re-examine the information 
and revise the margin calculations, if appropriate.
    Regarding the information involving non-market economies (``NME''), 
the Department presumes, based on the extent of central government 
control in an NME, that a single dumping margin, should there be one, 
is appropriate for all NME exporters in the given country. In the 
course of these investigations, all parties will have the opportunity 
to provide relevant information related to the issues of a country's 
NME status and the granting of separate rates to individual exporters. 
See, e.g., Final Determination of Sales at Less Than Fair Value: 
Silicon Carbide from the People's Republic of China, 59 FR 22585 (May 
2, 1994).
Germany

Export Price

    The petitioners based export price (``EP'') on price quotes within 
the POI for the sale of delivered PVA produced by Kuraray Europe from a 
U.S. distributor to a customer in the United States. The petitioners 
calculated a net U.S. price by deducting a distributor mark-up, 
international freight, brokerage and handling, and insurance expenses,

[[Page 61593]]

U.S. customs duties, U.S. inland freight from the warehouse to the 
customer, and U.S. credit expenses. We adjusted the petitioners' EP 
calculation by not deducting an amount for imputed U.S. credit 
expenses; instead, we made an adjustment to normal value (``NV''), in 
accordance with the Department's EP circumstance-of-sale calculation 
methodology.

Normal Value

    With respect to NV, the petitioners provided home market price 
quotes within the POI for applications and grades comparable to the 
products exported to the United States which serve as the basis for EP. 
The petitioners made an adjustment to home market price for home market 
credit expenses. As noted above, we made a circumstance-of-sale 
adjustment for U.S. credit expenses. Moreover, we recalculated NV using 
exchange rates published by the Federal Reserve in accordance with our 
practice.
    The petitioners have provided information demonstrating reasonable 
grounds to believe or suspect that sales of PVA in the home market were 
made at prices below the fully absorbed COP, within the meaning of 
section 773(b) of the Act, and requested that the Department conduct a 
country-wide sales-below-cost investigation. Pursuant to section 
773(b)(3) of the Act, COP consists of the cost of manufacturing 
(``COM''); selling, general, and administrative expenses (``SG&A''); 
financial expenses; and packing expenses. The petitioners calculated 
COM based on their own production experience, adjusted for known 
differences between costs incurred to produce PVA in the United States 
and in Germany. To calculate SG&A and financial expenses, the 
petitioners relied upon amounts reported in the 2001 consolidated 
financial statements of Clariant Corporation, the predecessor to 
Kuraray Europe. Based upon a comparison of the prices of the foreign 
like product in the home market to the calculated COP of the product, 
we find reasonable grounds to believe or suspect that sales of the 
foreign like product were made below the COP, within the meaning of 
section 773(b)(2)(A)(i) of the Act. Accordingly, the Department is 
initiating a country-wide cost investigation.
    Pursuant to sections 773(a)(4), 773(b) and 773(e) of the Act, the 
petitioners also based NV for sales in Germany on CV. The petitioners 
calculated CV using the same COM, SG&A, and financial expense figures 
used to compute the German home market costs. Consistent with 773(e)(2) 
of the Act, the petitioners included in CV an amount for profit. For 
profit, the petitioners relied upon amounts reported in the German PVA 
producer's 2001 financial statements. The petitioners' calculation of 
profit was based on operating profit and not on the net income of the 
German PVA producer. Therefore, for initiation purposes, we have 
recalculated the CV profit rate to include non-operating items. Because 
this calculation resulted in a loss, we used a profit rate of zero. 
Should the need arise to use the profit rate provided by the 
petitioners as facts available under section 776 of the Act in our 
preliminary or final determination, we may re-examine the information 
and, if appropriate, revise the margin calculations. Finally, we 
adjusted the petitioners' CV to make a circumstance-of-sale adjustment 
for credit expenses, in accordance with our statutory EP calculation 
methodology.
    The estimated dumping margin for Germany based on a comparison 
between the adjusted EP and home market price is 2.45 percent. The 
estimated dumping margin for Germany based on a comparison between the 
adjusted EP and CV is 19.05 percent.
Japan

Export Price

    The petitioners based EP on price quotes within the POI for the 
sale of delivered adhesive-application and textile-application PVA 
produced by Kuraray Co., Ltd. of Japan (Kuraray) to customers in the 
United States. The petitioners calculated a net U.S. price for 
adhesive-application PVA by deducting international freight, brokerage 
and handling, and insurance expenses, U.S. customs duties, and U.S. 
inland freight from the warehouse to the customer. For textile-
application PVA, the petitioners calculated a net U.S. price by 
deducting a distributor mark-up, international freight, brokerage and 
handling, and insurance expenses, U.S. customs duties, U.S. inland 
freight from the warehouse to the customer, and additional expenses 
incurred in the United States.

Normal Value

    With respect to NV, the petitioners provided home market price 
quotes within the POI for applications and grades comparable to the 
products exported to the United States which serve as the basis for EP. 
The petitioners made an adjustment to home market price for home market 
credit expenses.
    The petitioners have provided information demonstrating reasonable 
grounds to believe or suspect that sales of PVA in the home market were 
made at prices below the fully absorbed COP, within the meaning of 
section 773(b) of the Act, and requested that the Department conduct a 
country-wide sales-below-cost investigation. Pursuant to section 
773(b)(3) of the Act, COP consists of the COM, SG&A, financial 
expenses, and packing expenses. The petitioners calculated COM based on 
their own production experience, adjusted for known differences between 
costs incurred to produce PVA in the United States and in Japan. To 
calculate SG&A and financial expenses, the petitioners relied upon 
amounts reported in the 2001 consolidated financial statements of 
Kuraray. Based upon a comparison of the prices of the foreign like 
product in the home market to the calculated COP of the product, we 
find reasonable grounds to believe or suspect that sales of the foreign 
like product were made below the COP, within the meaning of section 
773(b)(2)(A)(i) of the Act. Accordingly, the Department is initiating a 
country-wide cost investigation.
    Pursuant to sections 773(a)(4), 773(b) and 773(e) of the Act, the 
petitioners also based NV for sales in Japan on CV. The petitioners 
calculated CV using the same COM, SG&A, and financial expense figures 
used to compute the Japanese home market costs. Consistent with 
773(e)(2) of the Act, the petitioners included in CV an amount for 
profit based upon Kuraray's 2001 financial statements. The petitioners 
made a circumstance-of-sale adjustment to CV for credit expenses.
    The estimated dumping margins for Japan based on a comparison 
between EP and home market price range from 15.46 to 29.04 percent. The 
estimated dumping margins based on a comparison between EP and CV range 
from 118.46 to 144.16 percent.
Korea

Export Price

    The petitioners based EP on price quotes within the POI for the 
sale of delivered PVA produced and sold by DC Chemical Co., Ltd. (``DC 
Chemical'') to customers in the United States. The petitioners 
calculated a net U.S. price by deducting a distributor mark-up, 
international freight, brokerage and handling, and insurance expenses, 
U.S. customs duties, U.S. inland freight from the warehouse to the 
customer, and imputed U.S. credit expenses. We adjusted the 
petitioners' EP calculation by not deducting an amount for imputed U.S. 
credit expenses; instead, we made an adjustment to NV, in accordance 
with the Department's EP circumstance-of-sale calculation methodology.

[[Page 61594]]

Normal Value

    With respect to NV, the petitioners provided a home market price 
quote within the POI for an application and grade comparable to the 
products exported to the United States which serve as the basis for EP. 
The petitioners made an adjustment to home market price for home market 
credit expenses. We revised the petitioners' calculation of home market 
credit expenses to base this expense on the Korean won price, rather 
than the U.S. dollar equivalent price. As noted above, we made a 
circumstance-of-sale adjustment for U.S. credit expenses. Moreover, we 
recalculated NV using exchange rates published by the Federal Reserve 
in accordance with our practice.
    The petitioners have provided information demonstrating reasonable 
grounds to believe or suspect that sales of PVA in the home market were 
made at prices below the fully absorbed COP, within the meaning of 
section 773(b) of the Act, and requested that the Department conduct a 
country-wide sales-below-cost investigation. Pursuant to section 
773(b)(3) of the Act, COP consists of the COM, SG&A, financial 
expenses, and packing expenses. The petitioners calculated COM based on 
their own production experience, adjusted for known differences between 
costs incurred to produce PVA in the United States and in Korea. In 
order to calculate SG&A and financial expenses, the petitioners relied 
upon amounts reported in the 2001 financial statements of DC Chemical. 
Based upon a comparison of the prices of the foreign like product in 
the home market to the calculated COP of the product, we find 
reasonable grounds to believe or suspect that sales of the foreign like 
product were made below the COP, within the meaning of section 
773(b)(2)(A)(i) of the Act. Accordingly, the Department is initiating a 
country-wide cost investigation.
    Pursuant to sections 773(a)(4), 773(b) and 773(e) of the Act, the 
petitioners also based NV for sales in Korea on CV. The petitioners 
calculated CV using the same COM, SG&A, and financial expense figures 
used to compute the Korean home market costs. Consistent with 773(e)(2) 
of the Act, the petitioners included in CV an amount for profit based 
upon DC Chemical's 2001 financial statements. The petitioners' 
calculation of profit was based on operating profit and not the net 
income of the Korean PVA producer. Therefore, for initiation purposes, 
we have recalculated the CV profit rate to include non-operating items. 
Because this calculation resulted in a loss, we used a profit rate of 
zero. Should the need arise to use the profit rate provided by the 
petitioners as facts available under section 776 of the Act in our 
preliminary or final determination, we may re-examine the information 
and, if appropriate, revise the margin calculations. Finally, we 
adjusted the petitioners' CV to make a circumstance-of-sale adjustment 
for credit expenses, in accordance with our statutory EP calculation 
methodology.
    The estimated dumping margin for Korea based on a comparison of the 
adjusted EP and home market price is 25.41 percent. The estimated 
dumping margin based on a comparison between the adjusted EP and CV is 
31.54 percent.
The PRC

Export Price

    The petitioners based EP on price quotes within the POI for the 
sale of PVA produced in the PRC from a U.S. distributor to a customer 
in the United States. The petitioners calculated a net U.S. price by 
deducting a distributor mark-up, international freight, brokerage and 
handling, and insurance expenses, U.S. customs duties, and U.S. inland 
freight from the warehouse to the customer. The petitioners also 
adjusted net U.S. price for inland freight expenses in the PRC using a 
surrogate value for rail freight in accordance with our NME 
methodology.

Normal Value

    The petitioners allege that the PRC is an NME country, and that in 
all previous investigations the Department has determined that the PRC 
is an NME. See, e.g., Notice of Final Determination in the Less Than 
Fair Value Investigation of Steel Wire Rope From the People's Republic 
of China, 66 FR 12759, 12761 (Feb. 28, 2001). In accordance with 
section 771(18)(c) of the Act, any determination that a foreign country 
has at one time been considered an NME shall remain in effect until 
revoked. Therefore, the PRC will continue to be treated as an NME 
unless and until its NME status is revoked. Pursuant to section 
771(18)(C)(i) of the Act, because the PRC's status as an NME remains in 
effect, the petitioners determined the dumping margin using an NME 
analysis.
    The petitioners assert that India is the most appropriate surrogate 
country for the PRC, claiming that India is: (1) A market economy; (2) 
a significant producer of comparable merchandise; and (3) at a level of 
economic development comparable to that of the PRC in terms of per-
capita gross national income. Based on the information provided by the 
petitioners, we believe that the petitioners' use of India as a 
surrogate country is appropriate for purposes of initiation of this 
investigation.
    The petitioners valued the factors of production using the 
quantities of inputs reported by the U.S. surrogate to produce PVA 
because current reliable information about PRC factor quantities was 
not reasonably available. The factors of production and usage amounts 
were derived from the actual production records of the U.S. surrogate 
generated for fully-hydrolyzed PVA during the period January through 
June 2002.
    Values for vinyl acetate monomer, acetic acid, and steam were based 
on the 2000-2001 annual report of Vinyl Chemicals (India) Ltd., an 
Indian chemical producer. The value for methanol and certain other raw 
material inputs were based on the values reported in the publication 
Chemical Weekly. Electricity was valued using electricity purchases 
taken from the 2000-2001 annual report of VAM Organic Chemical Ltd. 
(``VOCL''), an Indian producer of PVA. All surrogate values that fell 
outside the anticipated period of investigation, which in the PRC case 
is January 1, 2002, through June 30, 2002, were adjusted for inflation.
    The petitioners valued several material, labor, and energy inputs 
using U.S. producer costs rather than the costs of an Indian surrogate 
producer. We did not accept the valuation of certain of these inputs 
for purposes of initiation because non-U.S. surrogate prices were 
reasonably available to the petitioners. In addition, we did not accept 
the separate valuation of water and steam because these items appear to 
be included in the factory overhead rate derived from the surrogate 
producer's financial statements (see discussion of factory overhead 
below). Consequently, we recalculated NV to exclude each of the costs 
identified above because it is the most conservative approach in 
calculating an alleged dumping margin.
    To determine factory overhead, SG&A, and financial expenses, the 
petitioners relied on rates derived from the financial statements of 
VOCL. Based on the information provided by the petitioners, we believe 
that the surrogate values represent information reasonably available to 
the petitioners and are acceptable for purposes of initiation of this 
investigation.
    Based upon a comparison of EP to adjusted NV, the revised estimated 
dumping margin is 97.86 percent.

[[Page 61595]]

Singapore

Export Price

    The petitioners based EP on the average customs unit value of PVA 
imports during the period July 2001 through June 2002, as the 
petitioners stated they were unable to obtain price data for U.S. 
imports from Singapore.

Normal Value

    With respect to NV, the petitioners provided a range of prices for 
PVA sold in Singapore within the POI. For purposes of the petition, the 
petitioners used the lowest price in the range as a conservative 
estimate of the home market sales price for PVA. The petitioners made a 
circumstance-of-sale adjustment for credit expenses. We revised the 
petitioners' calculation of home market credit expenses to base this 
expense on the Singapore dollar price, rather than the U.S. dollar 
equivalent price.
    The petitioners have provided information demonstrating reasonable 
grounds to believe or suspect that sales of PVA in the home market were 
made at prices below the fully absorbed COP, within the meaning of 
section 773(b) of the Act, and requested that the Department conduct a 
country-wide sales-below-cost investigation. Pursuant to section 
773(b)(3) of the Act, COP consists of the COM, SG&A, financial 
expenses, and packing expenses. The petitioners calculated COM based on 
their own production experience, adjusted for known differences between 
costs incurred to produce PVA in the United States and in Singapore. In 
order to calculate SG&A and financial expenses, the petitioners relied 
upon amounts reported in the 2001 unconsolidated financial statements 
of Chemical Industries Ltd., a Singaporean producer of comparable 
merchandise. We recalculated financial expenses based on the 2001 
consolidated financial statements of this company. Based upon a 
comparison of the prices of the foreign like product in the home market 
to the calculated COP of the product, we find reasonable grounds to 
believe or suspect that sales of the foreign like product were made 
below the COP, within the meaning of section 773(b)(2)(A)(i) of the 
Act. Accordingly, the Department is initiating a country-wide cost 
investigation.
    Pursuant to sections 773(a)(4), 773(b) and 773(e) of the Act, the 
petitioners also based NV for sales in Singapore on CV. The petitioners 
calculated CV using the same COM, SG&A, and financial expense figures 
used to compute the Singapore home market costs. Consistent with 
773(e)(2) of the Act, the petitioners calculated an amount for profit 
based upon Chemical Industries Ltd.'s 2001 financial statements. 
Because these statements showed a net loss, petitioners included a zero 
profit in CV. We recalculated financial expenses as noted above. 
Furthermore, the petitioners made a circumstance-of-sale adjustment to 
CV for credit expenses.
    The estimated dumping margin for Singapore based on a comparison 
between the adjusted EP and home market price is 35.11 percent. The 
estimated dumping margin based on a comparison between the adjusted EP 
and CV is 61.94 percent.

Fair Value Comparisons

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

Allegations and Evidence of Material Injury and Causation

    With regard to Germany, Japan, Korea, and the PRC, the petitioners 
allege that the U.S. industry producing the domestic like product is 
being materially injured, or is threatened with material injury, by 
reason of the individual and cumulated imports of the subject 
merchandise sold at less than NV. With respect to Singapore, while the 
imports from Singapore do not meet the statutory requirement for 
cumulation, in its analysis for threat, the petitioners allege that 
imports from Singapore will imminently account for more than three 
percent of all PVA imports of the subject merchandise and therefore are 
not negligible. See section 771(24)(A)(ii) of the Act.
    The petitioners contend that the industry's injured condition is 
evident in the declining trends in net operating profits, net sales 
volumes, profit-to-sales ratios, production employment, and capacity 
utilization. The allegations of injury and causation are supported by 
relevant evidence including U.S. Customs import data, lost sales, and 
pricing information. We have assessed the allegations and supporting 
evidence regarding material injury and causation, and we have 
determined that these allegations are properly supported by adequate 
evidence and meet the statutory requirements for initiation. See the 
Initiation Checklist.

Initiation of Antidumping Investigations

    Based upon our examination of the petitions on PVA, we have found 
that they meet the requirements of section 732 of the Act. Therefore, 
we are initiating antidumping duty investigations to determine whether 
imports of PVA from Germany, Japan, Korea, the PRC, and Singapore are 
being, or are likely to be, sold in the United States at less than fair 
value. Unless this deadline is extended pursuant to section 
733(b)(1)(A) of the Act, 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 the governments of Germany, Japan, Korea, the PRC, 
and Singapore. We will attempt to provide a copy of the public version 
of each petition to each exporter named in the petitions, as provided 
for under 19 CFR 351.203(c)(2).

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 no later than October 21, 2002, whether 
there is a reasonable indication that imports of PVA from Germany, 
Japan, Korea, the PRC, and Singapore 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 issued and published pursuant to section 777(i) of 
the Act.

    Dated: September 25, 2002.
Faryar Shirzad,
Assistant Secretary for Import Administration.
[FR Doc. 02-24928 Filed 9-30-02; 8:45 am]
BILLING CODE 3510-DS-P