[Federal Register Volume 68, Number 244 (Friday, December 19, 2003)]
[Notices]
[Pages 70778-70780]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E3-00597]


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DEPARTMENT OF COMMERCE

International Trade Administration

[C-533-839]


Notice of Initiation of Countervailing Duty Investigation: 
Carbazole Violet Pigment 23 From India

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

EFFECTIVE DATE: December 19, 2003.

FOR FURTHER INFORMATION CONTACT: Sean Carey at (202) 482-3964, Office 
of AD/CVD Enforcement Office 7, 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 21, 2003, the U.S. Department of Commerce (the 
Department) received a petition filed in proper form by Sun Chemical 
Corporation and Nation Ford Chemical Company (collectively, the 
petitioners). The Department received supplemental information to the 
petition from the petitioners on December 5, 2003.
    In accordance with section 702(b)(1) of the Act, petitioners allege 
that producers or exporters of carbazole violet pigment 23 (CVP-23) in 
India receive countervailable subsidies within the meaning of section 
701 of the Act, and that imports from India are materially injuring, or 
are threatening material injury, to an industry in the United States.
    The Department finds that the petitioners filed the petition on 
behalf of the domestic industry because they are interested parties as 
defined in section 771(9)(C) of the Act and they have demonstrated 
sufficient industry support with respect to the countervailing duty 
investigation that they are requesting the Department to initiate. See 
infra, ``Determination of Industry Support for the Petition.''

Period of Investigation

    The anticipated period of investigation (POI) is January 1, 2002 
through December 31, 2002.

Scope of Investigation

    The merchandise covered by this investigation is carbazole violet 
23 identified as Color Index No. 51319 and Chemical Abstract No. 6358-
30-1, with the chemical name of diindolo [3,2-b:3',2'-
m]triphenodioxazine, 8,18-dichloro-5, 15 5,15-diethy-5,15-dihydro-, and 
molecular formula of 
C[bdi3][bdi4]H[bdi2][bdi2]Cl[bdi2]N[bdi4]O[bdi2].\1\ The subject 
merchandise includes the crude pigment in any form (e.g., dry powder, 
paste, wet cake) and finished pigment in the form of presscake and dry 
color. Pigment dispersions in any form (e.g. pigments dispersed in 
oleoresins, flammable solvents, water) are not included within the 
scope of the investigation.
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    \1\ Please note that the bracketed section of the product 
description, [3,2-b:3',2'-m], is not business proprietary 
information. In this case, the brackets are simply part of the 
chemical nomenclature. See December 4, 2003, amendment to petition 
(supplemental petition) at 8.
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    The merchandise subject to this investigation is classifiable under 
subheading 3204.17.9040 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.
    During our review of the petition, we discussed the scope with the 
petitioners to ensure that it is an accurate reflection of the products 
for which the domestic industry is seeking relief. 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.

Consultations

    In accordance with Article 13.1 of the Agreement on Subsidies and 
Countervailing Measures and section 702(b)(4)(A)(ii) of the Tariff Act 
of 1930, we held consultations with the Government of India (``GOI'') 
regarding this petition on December 9, 2003. See Memorandum to the File 
from Sean Carey: Consultations with the Government of India Regarding 
the Countervailing Duty Petition on Carbazole Violet Pigment 23, dated 
December 10, 2003.

Determination of Industry Support for the Petition

    Section 702(b)(1) of the Act requires that a petition be filed on 
behalf of the domestic industry. Section 702(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 satisfies 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

[[Page 70779]]

domestic like product produced by that portion of the industry 
expressing support for, or opposition to, the petition. Moreover, 
section 702(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 U.S. 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 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 (CIT 
2001), citing Algoma Steel Corp. Ltd., v. United States, 688 F. 
Supp. 639, 642-44 (CIT 1988). See also 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.
    In this case, the petition covers a single class or kind of 
merchandise, CVP-23, as defined in the ``Scope of Investigation'' 
section, above. The petitioners do not offer a definition of domestic 
like product distinct from the scope of the investigation. Further, 
based on our analysis of the information presented to the Department by 
the petitioners, we have determined that there is a single domestic 
like product which is consistent with the definition of the ``Scope of 
the Investigation'' section above and have analyzed industry support in 
terms of this domestic like product.
    The Department has determined that the petitioners have established 
industry support representing over 50 percent of total production of 
the domestic like product, requiring no further action by the 
Department pursuant to section 702(c)(4)(D) of the Act. In addition, 
the Department received no opposition to the petitions from domestic 
producers of the 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 702(c)(4)(A)(i) of the Act are met. Furthermore, 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 
702(c)(4)(A)(ii) of the Act also are met.
    Accordingly, we determine that the petition is filed on behalf of 
the domestic industry within the meaning of section 702(b)(1) of the 
Act. See Countervailing Duty Investigation Initiation Checklist: 
Carbazole Violet Pigment 23 (CVP-23) in the Forms of Crude Pigment, 
Presscake and Dry Color Pigment from India (December 11, 2003) 
(Initiation Checklist) at Attachment II, on file in the Central Records 
Unit, Room B-099 of the Department of Commerce.

Injury Test

    Because India is a ``Subsidies Agreement Country'' within the 
meaning of section 701(b) of the Act, section 701(a)(2) applies to this 
investigation. Accordingly, the ITC must determine whether imports of 
the subject merchandise from India are materially injuring, or are 
threatening material injury to, an industry in the United States.

Allegations of Subsidies

    Section 702(b) of the Act requires the Department to initiate a 
countervailing duty proceeding whenever an interested party files a 
petition, on behalf of an industry, that; (1) alleges the elements 
necessary for an imposition of a duty under section 701(a), and (2) is 
accompanied by information reasonably available to petitioners 
supporting the allegations.
    We are initiating an investigation of the following programs 
alleged in the petition to have provided countervailable subsidies to 
manufacturers, producers and exporters of the subject merchandise in 
India (a full description of each program is provided in the CVD 
Initiation Checklist):
    1. The Duty Entitlement Passbook Scheme (DEPS)/ Post-Export Credits
    2. Export Promotion Capital Goods Scheme (EPCGS)
    3. Export Processing Zones (EPZ)/ Export-Oriented Units (EOU) 
Programs
    4. Income Tax Exemption Scheme (Sections 10A, 10B, and 80 HHC)
    5. Pre-Shipment Export Financing
    6. Exemption of Export Credit from Interest Taxes
    7. Market Development Assistance (MDA)
    8. Special Imprest Licenses
    9. Central Value Added Tax (CENVAT) Scheme

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 subsidized imports from India of the 
subject merchandise.
    The petitioners contend that the industry's injured condition is 
evident in the declining trends in net operating profits, net sales 
volumes, domestic prices, revenue, profit-to-sales ratios, production 
employment, capacity utilization, and domestic market share. The 
allegations of injury and causation are supported by relevant evidence 
including U.S. import data, lost sales, and pricing information.
    The Department has assessed the allegations and supporting evidence 
regarding material injury and causation and determined that these 
allegations are properly supported by adequate evidence and meet the 
statutory requirements for initiation. See Initiation Checklist.

Initiation of Countervailing Duty Investigation

    Based on our examination of the petition on CVP-23, and 
petitioners' responses to our requests for supplemental information 
clarifying the petition, we have found that the petition meets the 
requirements of section 702(b) of the Act. Therefore, in accordance 
with section 702(b) of the Act, we are initiating a countervailing duty 
investigation to determine whether

[[Page 70780]]

manufacturers, producers, or exporters of CVP-23 from India receive 
countervailable subsidies. Unless the deadline is extended, we will 
make our preliminary determination no later than 65 days after the date 
of this initiation.

Distribution of Copies of the Petition

    In accordance with section 702(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 India. We will attempt to provide a copy of the 
public version of the petition to each exporter named in the petition, 
as provided for under 19 CFR 351.203(c)(2).

ITC Notification

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

Preliminary Determination by the ITC

    The ITC will determine no later than January 5, 2004, whether there 
is a reasonable indication that imports of CVP-23 from India are 
materially injuring, or threatening 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 11, 2003.
James Jochum,
Assistant Secretary for Import Administration.
[FR Doc. E3-00597 Filed 12-19-03; 8:45 am]
BILLING CODE 3510-DS-S