[Federal Register Volume 68, Number 59 (Thursday, March 27, 2003)]
[Notices]
[Pages 14945-14947]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-7363]


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

DEPARTMENT OF COMMERCE

International Trade Administration

[A-570-825]


Sebacic Acid From the People's Republic of China: Notice of 
Preliminary Results of Changed Circumstances Review and Preliminary 
Intent Not To Revoke the Antidumping Duty Order

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

EFFECTIVE DATE: March 27, 2003.

FOR FURTHER INFORMATION CONTACT: Mike Strollo or Gregory E. Kalbaugh at 
(202) 482-0629 or (202) 482-3693, respectively, Office of AD/CVD 
Enforcement, Office 2, Import Administration, International Trade 
Administration, U.S. Department of Commerce, 14th Street and 
Constitution Avenue, NW., Washington, DC 20230.

SUMMARY: On January 10, 2003, in response to a request by Moreflex, 
Inc., a U.S. importer of subject merchandise and an interested party in 
this proceeding, the Department of Commerce initiated a changed 
circumstances review to consider revocation of the antidumping duty 
order on sebacic acid from the People's Republic of China.
    We preliminarily determine that there is no reasonable basis to 
believe that changed circumstances sufficient to warrant revocation 
exist because interested parties have expressed interest in maintaining 
the antidumping duty order, and there are no grounds for assuming that 
revocation of the order is supported by ``substantially all'' of the 
domestic producers of the like product. Consequently, we preliminarily 
do not intend to revoke the order on sebacic acid from the People's 
Republic of China. Interested parties are invited to comment on these 
preliminary results.

SUPPLEMENTARY INFORMATION:

Background

    On July 14, 1994, the Department published in the Federal Register 
the antidumping duty order on sebacic acid from the People's Republic 
of China (PRC). See Antidumping Duty Order: Sebacic Acid From the 
People's Republic of China, 59 FR 35909 (July 14, 1994). On November 
26, 2002, Morflex, Inc. (Morflex), a U.S. importer of subject 
merchandise and an interested party in this proceeding, requested that 
the Department revoke the antidumping duty order on sebacic acid from 
the PRC through a changed circumstances review. According to Morflex, 
Arizona Chemical Corporation (ACC), a domestic producer of sebacic 
acid, intended to cease production of sebacic acid in the United States 
at the end of November 2002. ACC asserts that it is the successor-in-
interest to the original petitioner in this proceeding, Union Camp 
Corporation. In addition, on September 25, 2002, prior to Morflex's 
request, ACC notified the Department that it intended to cease 
production of sebacic acid no later than December 31, 2002.
    Based on the information submitted by Morflex and ACC, the 
Department determined that there was sufficient evidence of changed 
circumstances to warrant a review under section 751(b)(1) of the Tariff 
Act of 1930, as amended (the Act), and 19 CFR 351.222(g) and 351.216, 
and consequently, we initiated a changed circumstances review on 
January 10, 2003. See Sebacic Acid from the People's Republic of China: 
Notice of Initiation of Changed Circumstances Review and Consideration 
of Revocation of the Antidumping Duty Order, 68 FR 2315-01 (January 16, 
2003) (Initiation Notice). In the Initiation Notice, we stated that the 
Department would consider whether there is interest in

[[Page 14946]]

continuing the order on the part of the U.S. industry, and we invited 
comments from interested parties. We also stated that the Department 
would publish in the Federal Register a notice of preliminary results 
of changed circumstances review, in accordance with 19 CFR 
351.221(c)(3)(i), prior to the issuance of the final results.
    Since the Department's notice of initiation of this review, the 
following events have occurred. On January 13, 2003, the Department 
issued questionnaires to ACC and an additional U.S. producer of sebacic 
acid, CasChem Inc. (CasChem), seeking to determine whether producers 
accounting for substantially all of the production of the domestic like 
product to which the order pertains have expressed a lack of interest 
in the order.
    On January 26, 2003, we received a submission from SST Materials, 
Inc., doing business as Genesis Chemicals, Inc. (Genesis), a domestic 
manufacturer and distributor of sebacic acid, which indicated that 
Genesis opposes revocation of the antidumping duty order. On January 
28, 2003, the Department issued a follow-up questionnaire to Genesis.
    On January 31, 2003, ACC submitted a response to the Department's 
questionnaire, in which it indicated that its production of sebacic 
acid ceased on December 19, 2002. However, ACC noted that it opposes 
the revocation of the antidumping duty order since it has facilities, 
employees, and resources in place for the purpose of selling its 
remaining inventory of sebacic acid.
    On February 5, 2003, the Department received comments opposing the 
revocation of the antidumping duty order from both Genesis and ICC 
Chemical Corporation (ICC), a U.S. importer of sebacic acid from the 
PRC.
    On February 11, 2003, we received additional information from 
Genesis in which Genesis indicated that it began domestic production of 
sebacic acid late in 2002, and currently accounts for all new domestic 
sebacic acid production. CasChem did not respond to the Department's 
questionnaire.\1\
---------------------------------------------------------------------------

    \1\ ACC, ICC, and Genesis each placed on the record an article 
from the trade journal ``Chemical Market Reporter,'' dated January 
20, 2003, which indicated that: (1) ACC and CasChem had been the 
only domestic producers of sebacic acid but both ceased domestic 
production of sebacic acid in December 2002; (2) Genesis began 
producing sebacic acid in December 2002; and (3) Genesis, as of 
January 2003, was the sole domestic producer of sebacic acid.
---------------------------------------------------------------------------

Scope of the Review

    The products covered by this review are all grades of sebacic acid, 
a dicarboxylic acid with the formula 
(CH2)8(COOH)2, which include but are not limited 
to CP Grade (500ppm maximum ash, 25 maximum APHA color), Purified Grade 
(1000ppm maximum ash, 50 maximum APHA color), and Nylon Grade (500ppm 
maximum ash, 70 maximum ICV color). The principal difference between 
the grades is the quantity of ash and color. Sebacic acid contains a 
minimum of 85 percent dibasic acids of which the predominant species is 
the C10 dibasic acid. Sebacic acid is sold generally as a 
free-flowing powder/flake.
    Sebacic acid has numerous industrial uses, including the production 
of nylon 6/10 (a polymer used for paintbrush and toothbrush bristles 
and paper machine felts), plasticizers, esters, automotive coolants, 
polyamides, polyester castings and films, inks and adhesives, 
lubricants, and polyurethane castings and coatings.
    Sebacic acid is currently classifiable under subheading 
2917.13.00.30 of the Harmonized Tariff Schedule of the United States 
(HTSUS). Although the HTSUS subheading is provided for convenience and 
customs purposes, our written description of the scope of this 
proceeding is dispositive.

Analysis

    Pursuant to section 751(d) of the Act, the Department may revoke an 
antidumping duty order based on a review under section 751(b) of the 
Act. Section 782(h)(2) of the Act and 19 CFR 351.222(g)(1)(i) provide 
that the Department may revoke an order, in whole or in part, based on 
changed circumstances if ``(p)roducers accounting for substantially all 
of the production of the domestic like product to which the order (or 
the part of the order to be revoked) * * * have expressed a lack of 
interest in the order, in whole or in part * * *'' In this context, the 
Department has interpreted ``substantially all'' production normally to 
mean at least 85 percent of domestic production of the like product 
(see Oil Country Tubular Goods From Mexico: Preliminary Results of 
Changed Circumstances Antidumping Duty Administrative Review, 64 FR 
14213, 14214 (March 24, 1999)).
    In order to determine whether ``substantially all'' of the domestic 
producers supported revocation of the order with respect to the 
merchandise in question, we solicited comments from all known domestic 
producers of sebacic acid. See Initiation Notice. As noted above, we 
received objections from ACC and Genesis.\2\ We note that because ACC 
and CasChem no longer produce sebacic acid, they are no longer 
considered ``interested parties'' pursuant to section 771(9)(C) of the 
Act. Nonetheless, Moreflex's submission contains no evidence indicating 
that at least 85 percent of the domestic industry of the like product 
has no interest in the continuance of the order with respect to the 
merchandise in question. Given that Genesis objects to the revocation 
of the antidumping duty order, and has indicated that it comprises the 
universe of domestic sebacic acid producers, we have preliminarily 
determined that there are no grounds for concluding that at least 85 
percent of the domestic industry has expressed a lack of interest in 
maintaining the order.
---------------------------------------------------------------------------

    \2\ While we did receive objections from ICC, pursuant to 
782(h)(2) of the Act, only objections from producers of domestic 
like product are considered when the Department makes a 
determination of whether there is interest in maintaining the order.
---------------------------------------------------------------------------

Notice of Intent Not To Revoke the Antidumping Duty Order

    Under the definition of ``substantially all,'' as indicated above, 
there are no grounds for assuming that revocation of the order is 
supported by ``substantially all'' of the domestic producers of the 
like product. As a result, we preliminarily determine that changed 
circumstances sufficient to warrant revocation of the antidumping duty 
order on sebacic acid from the PRC do not exist. The current 
requirements for the cash deposit of estimated antidumping duties on 
the subject merchandise will remain in effect until the publication of 
the final results of this review. Parties wishing to comment on these 
results must submit briefs to the Department within 30 days after the 
publication of this notice in the Federal Register. Parties will have 
five days subsequent to this due date to submit rebuttal briefs. 
Parties who submit comments or rebuttal briefs in this proceeding are 
requested to submit with the argument: (1) A statement of the issue, 
and (2) a brief summary of the argument (no longer than five pages, 
including footnotes). Any requests for hearing must be filed within 30 
days of the publication of this notice in the Federal Register. In 
accordance with 19 CFR 351.216(e), the Department will issue its final 
results of review within 270 days after the date on which the changed 
circumstances review was initiated (i.e., no later than October 7, 
2003).
    This notice is published in accordance with sections 751(b)(1) and 
(d) and 777(i) of the Act, and with 19 CFR 351.221(c)(3).


[[Page 14947]]


    Dated: March 20, 2003.
Joseph A. Spetrini,
Acting Assistant Secretary for Import Administration.
[FR Doc. 03-7363 Filed 3-26-03; 8:45 am]
BILLING CODE 3510-DS-P