[Federal Register Volume 68, Number 236 (Tuesday, December 9, 2003)]
[Notices]
[Pages 68591-68593]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-30489]



[[Page 68591]]

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DEPARTMENT OF COMMERCE

International Trade Administration

[A-570-891]


Notice of Initiation of Antidumping Duty Investigation: Hand 
Trucks and Certain Parts Thereof from the People's Republic of China

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

ACTION: Initiation of an Antidumping Duty Investigation.

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EFFECTIVE DATE: December 9, 2003.

FOR FURTHER INFORMATION CONTACT: Audrey Twyman, Stephen Cho or Daniel 
J. Alexy at (202) 482-3534, (202) 482-3798, or (202) 482-1540 
respectively, Import Administration, International Trade 
Administration, U.S. Department of Commerce, 14th Street and 
Constitution Avenue, NW, Washington, DC 20230.

SUPPLEMENTARY INFORMATION:

INITIATION OF INVESTIGATION:

The Petition

    On November 13, 2003, the Department of Commerce (``the 
Department'') received a petition filed in proper form by Gleason 
Industrial Products, Inc. On November 18, 2003, the Department received 
an amendment to the petition filed in proper form by Gleason Industrial 
Products, Inc. On November 19, 2003, the Department sent a supplemental 
questionnaire to Gleason Industrial Products, Inc. and received a 
response on November 25, 2003. On December 1, 2003, Gleason Industrial 
Products, Inc. filed an amendment to the petition to include Precision 
Products Inc. as a co-petitioner (``the petitioners'').\1\ On December 
2, 2003, the Department received a letter from the China Chamber of 
Commerce for Import & Export of Machinery & Electronics on behalf of 
their members who produce hand trucks in China claiming that the 
petitioners do not meet the industry support requirement of section 
732(c)(4)(A) of the Tariff Act of 1930, as amended (``the Act''). On 
December 3, 2003, Gleason Industrial Products, Inc. submitted a 
response to the China Chamber of Commerce's allegations. Also on 
December 3, 2003, the Department received a letter from the United Food 
& Commercial Workers International Union in support of the petition on 
behalf of their members, some of whom work in Gleason Industrial 
Products, Inc.'s manufacturing facilities.
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    \1\ Gleason Industrial Products, Inc. and Precision Products 
Inc. are both members of the Gleason Group companies. Gleason 
Industrial Products, Inc. manufactures and sells hand trucks. 
Precision Products Inc. also manufactures hand trucks, but sells all 
its hand trucks through Gleason Industrial Products, Inc.
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    In accordance with section 732(b)(1) of the Act, the petitioners 
allege that imports of hand trucks and certain parts thereof (``hand 
trucks'') from the People's Republic of China (``the PRC'') 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 the PRC 
are materially injuring, or are threatening to materially injure, an 
industry in the United States.
    The Department finds that the petitioners filed this petition on 
behalf of the domestic industry because they are interested parties as 
defined in section 771(9)(C) of the Act and have demonstrated 
sufficient industry support with respect to the antidumping 
investigation that they are requesting the Department to initiate. See 
infra, ``Determination of Industry Support for the Petition.''

Scope of Investigation

    For the purpose of this investigation, the product covered consists 
of hand trucks manufactured from any material, whether assembled or 
unassembled, complete or incomplete, suitable for any use, and certain 
parts thereof, namely the vertical frame, the handling area and the 
projecting edges or toe plate, and any combination thereof.
    A complete or fully assembled hand truck is a hand-propelled barrow 
consisting of a vertically disposed frame having a handle or more than 
one handle at or near the upper section of the vertical frame; at least 
two wheels at or near the lower section of the vertical frame; and a 
horizontal projecting edge or edges, or toe plate, perpendicular or 
angled to the vertical frame, at or near the lower section of the 
vertical frame. The projecting edge or edges, or toe plate, slides 
under a load for purposes of lifting and/or moving the load.
    That the vertical frame can be converted from a vertical setting to 
a horizontal setting, then operated in that horizontal setting as a 
platform, is not a basis for exclusion of the hand truck from the scope 
of this petition. That the vertical frame, handling area, wheels, 
projecting edges or other parts of the hand truck can be collapsed or 
folded is not a basis for exclusion of the hand truck from the scope of 
the petition. That other wheels may be connected to the vertical frame, 
handling area, projecting edges, or other parts of the hand truck, in 
addition to the two or more wheels located at or near the lower section 
of the vertical frame, is not a basis for exclusion of the hand truck 
from the scope of the petition. Finally, that the hand truck may 
exhibit physical characteristics in addition to the vertical frame, the 
handling area, the projecting edges or toe plate, and the two wheels at 
or near the lower section of the vertical frame, is not a basis for 
exclusion of the hand truck from the scope of the petition.
    Examples of names commonly used to reference hand trucks are hand 
truck, convertible hand truck, appliance hand truck, cylinder hand 
truck, bag truck, dolly, or hand trolley. They are typically imported 
under heading 8716.80.50.10 of the Harmonized Tariff Schedule of the 
United States (``HTSUS''), although they may also be imported under 
heading 8716.80.50.90. Specific parts of a hand truck, namely the 
vertical frame, the handling area and the projecting edges or toe 
plate, or any combination thereof, are typically imported under heading 
8716.90.5060 of the HTSUS. Although the HTSUS subheadings are provided 
for convenience and for the purposes of U.S. Customs and Border 
Protection, the Department's written description of the scope is 
dispositive.
    Excluded from the scope are small two-wheel or four-wheel utility 
carts specifically designed for carrying loads like personal bags or 
luggage in which the frame is made from telescoping tubular material 
measuring less than 5/8 inch in diameter; hand trucks that use 
motorized operations either to move the hand truck from one location to 
the next or to assist in the lifting of items placed on the hand truck; 
vertical carriers designed specifically to transport golf bags; and 
wheels and tires used in the manufacture of hand trucks.
    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 determination.

[[Page 68592]]

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 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 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: 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 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 USEC, Inc. v. United States, 132 F. Supp. 2d 1, 8 (Ct. 
Int'l Trade 2001), citing Algoma Steel Corp. Ltd. v. United States, 
688 F. Supp. 639, 642-44 (Ct. Int'l Trade 1988).
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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.
    The domestic like product referred to in the petition is the single 
domestic like product defined in the ``Scope of Investigation'' section 
above. The Department has no basis on the record to find this 
definition of the domestic like product to be inaccurate. The 
Department, therefore, has adopted this domestic like product 
definition.
    In their initial petition and subsequent submissions, the 
petitioners state that they comprise more than 50 percent of U.S. hand 
truck production. Based on all available information, we agree that the 
petitioners comprise more than 50 percent of the domestic hand truck 
production and accordingly, determine that the petition has been filed 
on behalf of the domestic industry within the meaning of section 
732(b)(1) of the Act. See Initiation Checklist dated December 3, 2003 
(public version on file in the Central Records Unit of the Department 
of Commerce, Room B-099) (``Initiation Checklist'').

Period of Investigation

    The anticipated period of investigation (``POI'') is April 1, 2003, 
through September 30, 2003.

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 this investigation. The sources of data relating to export 
price (``EP''), normal value (``NV''), and factors of production 
(``FOP'') 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 an investigation involving a non-market economy (``NME'') 
country, 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 this investigation, 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., Notice of Final Determination of Sales at Less 
Than Fair Value: Silicon Carbide from the People's Republic of China, 
59 FR 22585, 22586-87 (May 2, 1994).

Export Price

    The petitioners based the export price on price quotes from a 
Chinese producer of hand trucks to unaffiliated purchasers in the 
United States within the POI as reported in Exhibit 19 of the November 
13, 2003 petition. The petitioners claim that the two price quotes 
obtained were for two models of hand trucks that are among the most 
prevalent of the models imported from China. Accordingly, we found that 
the gross unit prices provided by the petitioners represent information 
that reasonably reflected prices to the United States. Therefore, we 
relied on the gross unit prices provided in the petition. The prices 
were quoted FOB Qingdao, the PRC, and the petitioners were conservative 
because they did not deduct Chinese inland freight from the quoted 
prices.

Normal Value

    The petitioners assert that the PRC is an NME country, and note 
that in all previous investigations the Department has determined that 
the PRC is an NME. See, e.g., Notice of Final Determination of Sales at 
Less Than Fair Value: Bulk Aspirin From the People's Republic of China, 
65 FR 33805 (May 25, 2000). The PRC will be treated as an NME unless 
and until its NME status is revoked. See section 771(18)(C)(i) of the 
Act. Because the PRC's status as an NME remains in effect, the 
petitioners estimated the dumping margin using an NME methodology.
    The petitioners assert that India is the most appropriate surrogate 
country for the PRC, claiming that India is: 1) at a level of economic 
development comparable to the PRC in terms of per capita gross national 
product, and 2) a significant producer of comparable merchandise. The 
petitioners provided recent U.S. import statistics of hand trucks from 
India and a report by a researcher in India hired by the petitioners to 
study the hand truck industry. The report shows that there is 
significant production of hand trucks in India. Based on the 
information provided by the petitioners, we believe that the 
petitioners' use of India as a surrogate country is appropriate for the 
purpose of initiating this investigation.
    The petitioners estimated the quantities of inputs required to 
produce hand trucks in the PRC based on the petitioners' own experience 
and their extensive analysis of the two representative hand trucks they 
acquired from the PRC. Based on the

[[Page 68593]]

information provided by the petitioners, we believe that the 
petitioners' FOP methodology represents information reasonably 
available to the petitioners and is appropriate for purposes of 
initiating this investigation.
    In accordance with section 773(c)(4) of the Act, the petitioners 
valued FOP, where possible, on reasonably available, public surrogate 
data from India. The petitioners valued all direct materials (with the 
exception of ball bearings and tires), packing materials, and scrap 
based on Indian import values, as published in the 2002 Monthly 
Statistics of Foreign Trade of India. These values were inflated to the 
current POI using the Indian wholesale price index (``WPI'') as 
reported in the International Monetary Fund's International Financial 
Statistics (``IFS''), and converted to U.S. dollars using the U.S. 
Federal Reserve exchange rates for India.
    Concerning ball bearings and tires for the hand truck, the 
petitioners valued these inputs using price quotes they obtained from 
India for ball bearings and tires as surrogate values for the ball 
bearings and tires for the hand truck. The Department accepted these 
values as being representative of hand truck ball bearings and tires.
    The petitioners valued direct and packing labor using the 
regression-based wage rate for the PRC provided by the Department, in 
accordance with section 351.408(c)(3) of the Department's regulations. 
The petitioners based the amount of energy used on its own experience. 
Electricity was valued using the Indian Tata Energy Research Institute 
Energy Data Directory and Yearbook (2000/2001), and adjusted for 
inflation to reflect a POI value using the Reserve Bank of India RBI 
Bulletin. Natural gas was valued from an article at 
www.indiaonline.com, and adjusted for inflation based on the Indian 
WPI.
    The petitioners calculated financial ratios using four public 
financial statements of Indian producers of hand trucks. The Department 
did not find adequate evidence that one of the Indian firms, Excellent 
Engineering & Allied Services Private Limited, is a producer of hand 
trucks because: (1) it is not included in the list of producers of hand 
trucks submitted by the Indian researcher; (2) its financial statements 
do not indicate that it is a manufacturer of hand trucks; (3) its 
direct material costs are lower than the other companies; and (4) its 
financial statements refer to raw materials as ``trading materials.'' 
Therefore, we have removed this company's financial ratios from the 
calculation of normal value. Based on the information provided by the 
petitioners, we believe that the surrogate values represent information 
readily available to the petitioners and are acceptable for purposes of 
initiating this investigation.

Fair Value Comparisons

    Based on the data provided by the petitioners, there is reason to 
believe that imports of hand trucks from the PRC are being, or are 
likely to be, sold at less than fair value. As a result of a comparison 
of EP to NV, based on our recalculations described above, the estimated 
dumping margins range from 314.97 percent to 401.21 percent.

Allegations and Evidence of Material Injury and Causation

    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 imports of the subject merchandise 
sold at less than fair value.
    The petitioners contend that the industry's injured condition is 
evidenced by the loss of sale opportunities, depressed and/or 
suppressed domestic prices, reduced market share, and reduced 
profitability. The allegations of injury and causation are supported by 
relevant evidence including affidavits of company officials, U.S. 
Census Bureau import statistics, 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 Initiation Checklist.

Initiation of Antidumping Investigation

    Based upon our examination of the petition on hand trucks, we have 
found that it meets the requirements of section 732 of the Act. 
Therefore, we are initiating an antidumping duty investigation to 
determine whether imports of hand trucks from the PRC 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 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 government of the PRC.

ITC 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 December 29, 
2003, whether there is a reasonable indication that imports of hand 
trucks from the PRC are causing material injury, or threatening to 
cause material injury, to a U.S. industry. A negative ITC determination 
will result in the investigation being terminated; otherwise, this 
investigation will proceed according to statutory and regulatory time 
limits.
    This notice is issued and published pursuant to section 777(i) of 
the Act.

    Dated: December 3, 2003.
James J. Jochum,
Assistant Secretary for Import Administration.
[FR Doc. 03-30489 Filed 12-8-03; 8:45 am]
BILLING CODE 3510-DS-S