[Federal Register Volume 69, Number 50 (Monday, March 15, 2004)]
[Notices]
[Pages 12128-12133]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-5798]


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

DEPARTMENT OF COMMERCE

International Trade Administration

[A-570-894, A-570-895]


Notice of Initiation of Antidumping Duty Investigations: Certain 
Tissue Paper Products and Certain Crepe Paper Products from the 
People's Republic of China

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

EFFECTIVE DATE: March 15, 2004.

FOR FURTHER INFORMATION CONTACT: Michael Ferrier at (202) 482-2667, 
Rachel Kreissl at (202) 482-0409, and Nazak Nikakhtar at (202) 482-9079 
of Import Administration, International Trade Administration, U.S. 
Department of Commerce, 14th Street and Constitution Avenue, NW., 
Washington, DC 20230.

SUPPLEMENTARY INFORMATION:

Initiation of Investigations

The Petition

    On February 17, 2004, the Department of Commerce (``Department'') 
received an antidumping duty petition (``Petition'') filed in proper 
form by Seaman Paper Company of Massachusetts, Inc. (``Seaman''); 
American Crepe Corporation (``American Crepe''); Eagle Tissue LLC 
(``Eagle''); Flower City Tissue Mills Co. (``Flower City''); Garlock 
Printing & Converting, Inc. (``Garlock''); Paper Service Ltd. (``Paper 
Service''); Putney Paper Co., Ltd. (``Putney''); and the Paper, Allied-
Industrial, Chemical and Energy Workers International Union AFL-CIO, 
CLC (``PACE'') (collectively ``Petitioners''). Seaman, Eagle, Flower 
City , Garlock, Paper Service, and Putney are domestic producers of 
certain tissue paper products. Seaman and American Crepe are domestic 
producers of certain crepe paper products. On February 18, 2004, 
February 20, 2004, and February 24, 2004, the Department asked 
Petitioners to clarify certain aspects of the Petition. On February 23, 
2004, February 24, 2004, and February 27, 2004, Petitioners submitted 
information to supplement the Petition (``First Supplemental 
Response,'' ``Second Supplemental Response,'' and ``Third Supplemental 
Response,'' respectively). On February 27, 2004, the Department 
requested that Petitioners provide publicly ranged data for the 
quantity and value of imports (see Memorandum to the File: Request for 
Publicly Ranged Data for Volume and Value of Imports of Tissue Paper 
and Crepe Paper From the Peoples Republic of China, dated February 27, 
2004). On March 3, 2004, Petitioners filed their response to the 
Department's request (``Fourth Supplemental Response''). In accordance 
with section 732(b) of the Tariff Act of 1930, as amended (``the 
Act''), Petitioners allege that both imports of certain tissue paper 
products and certain crepe paper products 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 within the meaning of section 731 of the 
Act, and that such imports are materially injuring, or threatening 
material injury to, the respective U.S. industries.
    The Department finds that Petitioners filed their Petition on 
behalf of each domestic industry because they are an interested party 
as defined in section 771(9)(C) of the Act, and Petitioners have 
demonstrated sufficient industry support with respect to the 
investigations they are presently seeking. See Determination of 
Industry Support for the Petition section below.

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: (i) at least 25 
percent of the total production of the domestic like product; and (ii) 
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 law. 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).

[[Page 12129]]

    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.
    With regard to the domestic like products, Petitioners do not offer 
definitions of domestic like products distinct from the scopes of the 
investigations. Petitioners state that the two domestic like products 
are certain tissue paper products and crepe paper products. Based on 
our analysis of the information submitted in the Petition, we have 
determined that there are two domestic like products, certain tissue 
paper products and certain crepe paper products, which are defined 
further in the ``Scope of the Investigations'' section above, and we 
have analyzed industry support in terms of these domestic like 
products. For more information on our analysis and the data upon which 
we relied, see First Supplemental Response; Antidumping Duty 
Investigation Initiation Checklist (``Initiation Checklist''), dated 
March 8, 2004, Attachment II - Industry Support on file in the Central 
Record Unit (``CRU'') in room B-099 of the main Department of Commerce 
building. Additionally, Petitioners stated that they do not object if 
the Department wants to conduct two separate investigations of certain 
tissue paper products and certain crepe paper products (see First 
Supplemental Response).
    Based on the foregoing reasons and facts of this investigation, the 
Department will conduct two separate investigations of the subject 
merchandise, an individual investigation of certain tissue paper 
products from the PRC and an individual investigation of certain crepe 
paper products from the PRC.
    In determining whether the domestic petitioners have standing, we 
considered the industry support data contained in the Petition with 
reference to the domestic like products as defined above in the ``Scope 
of the Investigations'' section. Petitioners note that the Harmonized 
Tariff System does not have discrete categories for tissue paper 
products and crepe paper products. Consequently, Petitioners derived 
estimates of total imports for each product by summing market 
intelligence data and applying actual industry knowledge. See Petition 
at 34. Petitioners provided a declaration from an individual familiar 
with the tissue paper and crepe paper industries in the United States 
to support their market intelligence findings. See Petition at Exhibit 
9.
    Using the data described above, individual shares of the total 
estimated U.S. production of both certain tissue paper products and 
certain crepe paper products, represented by Petitioners in year 2003, 
exceeds 50 percent of total domestic production of certain tissue paper 
products and over 50 percent of total domestic production of certain 
crepe paper products. Therefore, the Department finds the domestic 
producers of certain tissue paper products who support the Petition 
account for at least 25 percent of the total production of the domestic 
like product. The Department also finds the domestic producers of crepe 
paper products who support the Petition account for at least 25 percent 
of the total production of that domestic like product. In addition, as 
no domestic producers have expressed opposition to the Petition, the 
Department also finds the domestic producers of both certain tissue 
paper products and certain crepe paper products, who support the 
Petition, account for more than 50 percent of the total domestic 
production of their respective products produced by those portions of 
the industries expressing support for, or opposition to, the Petition.
    Therefore, we find that Petitioners have met the requirements of 
section 732(c)(4)(A) of the Act, with respect to both certain tissue 
paper products and crepe paper products.

Scope of the Investigations

    The products covered by these two investigations are: 1) certain 
tissue paper products, and 2) certain crepe paper products from the 
People's Republic of China.

Tissue Paper Products

    The tissue paper products subject to investigation are cut-to-
length sheets of tissue paper having a basis weight not exceeding 29 
grams per square meter. Tissue paper products subject to this 
investigation may or may not be bleached, dye-colored, surface-colored, 
glazed, surface decorated or printed, sequined, crinkled, embossed, 
and/or die cut. The tissue paper subject to this investigation is in 
the form of cut-to-length sheets of tissue paper with a width equal to 
or greater than one-half (0.5) inch. Subject tissue paper may be flat 
or folded, and may be packaged by banding or wrapping with paper or 
film, by placing in plastic or film bags, and/or by placing in boxes 
for distribution and use by the ultimate consumer. Packages of tissue 
paper subject to this investigation may consist solely of tissue paper 
of one color and/or style, or may contain multiple colors and/or 
styles.
    Tissue paper products subject to this investigation do not have 
specific classification numbers assigned to them under the Harmonized 
Tariff Schedule of the United States (``HTSUS'') and appear to be 
imported under one or more of the several different ``basket'' 
categories, including but not necessarily limited to the following 
subheadings: HTSUS 4802.30, HTSUS 4802.54, HTSUS 4802.61, HTSUS 
4802.62, HTSUS 4802.69, HTSUS 4804.39, HTSUS 4806.40, HTSUS 4808.30, 
HTSUS 4808.90, HTSUS 4811.90, HTSUS 4823.90, HTSUS 9505.90.40.
    Although the HTSUS subheadings are provided for convenience and 
customs purposes, the written description of the scope of the 
investigation is dispositive.
    Excluded from the scope of the investigation are the following 
tissue paper products: (1) tissue paper products that are coated in 
wax, paraffin, or polymers, of a kind used in floral and food service 
applications; (2) tissue paper products that have been perforated, 
embossed, or die-cut to the shape of a toilet seat, i.e., disposable 
sanitary covers for toilet seats; (3) toilet or facial tissue stock, 
towel or napkin stock, paper of a kind used for household or sanitary 
purposes, cellulose wadding, and webs of cellulose fibers (HTS 
4803.00.20.00 and 4803.00.40.00).

Crepe Paper Products

    Crepe paper products subject to investigation have a basis weight 
not exceeding 29 grams per square meter prior to being creped and, if 
appropriate, flameproofed. Crepe paper has a finely wrinkled surface 
texture and typically but not exclusively is treated to be flame-
retardant. Crepe paper is typically but not exclusively produced as 
streamers in roll form and packaged in plastic bags. Crepe paper may or 
may not be bleached, dye-colored, surface-colored, surface decorated or 
printed, glazed, sequined, embossed, die-cut, and/or flame-retardant. 
Subject crepe paper may be rolled, flat or folded, and may be packaged 
by banding or wrapping with paper, by placing in plastic bags, and/or 
by placing in boxes for distribution and use by the ultimate consumer. 
Packages of crepe paper subject to this investigation may consist 
solely of crepe paper of one color and/or style, or may contain 
multiple colors and/or styles.

[[Page 12130]]

    Crepe paper products subject to this investigation do not have 
specific classification numbers assigned to them under the Harmonized 
Tariff Schedule of the United States (``HTSUS'') and appear to be 
imported under one or more of the several different ``basket'' 
categories, including but not necessarily limited to the following 
subheadings: HTSUS 4802.30, HTSUS 4802.54, HTSUS 4802.61, HTSUS 
4802.62, HTSUS 4802.69, HTSUS 4804.39, HTSUS 4806.40, HTSUS 4808.30, 
HTSUS 4808.90, HTSUS 4811.90, HTSUS 4823.90, HTSUS 9505.90.40.
    Although the HTSUS subheadings are provided for convenience and 
customs purposes, the written description of the scope of the 
investigation is dispositive.

Comments

    As discussed in the preamble to the Department's regulations, we 
are setting aside a period for parties to raise issues regarding 
product coverage. See Antidumping Duties; Countervailing Duties; Final 
Rule, 62 FR 27296, 27323 (May 19, 1997). The Department encourages all 
interested parties to submit such comments within 20 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, N.W., Washington, D.C. 
20230. This 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.

Period of Investigation

    The anticipated period of investigation (``POI'') for the both 
certain tissue paper products and certain crepe paper products will be 
July 1, 2003 through December 31, 2003. See 19 CFR 351.204(b).

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 source or sources of data for the 
deductions and adjustments relating to U.S. market prices, cost of 
production (``COP''), and normal value (``NV'') have been accorded 
treatment as business proprietary information. Petitioners' sources and 
methodology are discussed in greater detail in the business proprietary 
version of the Petition and in our 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 this information and revise the margin calculations, if 
appropriate.

Export Price

    For certain tissue paper products and certain crepe paper products 
from the PRC, Petitioners based their calculations of U.S. Price on 
Export Price (``EP''), as tissue paper products and crepe paper 
products were offered for sale to unaffiliated U.S. purchasers prior to 
their importation. Prices were based on price quotes obtained by 
Petitioners from three Chinese producers of certain tissue paper 
products and crepe paper products in November 2003. See Petition 
Exhibit 31. Based on these quotes, Petitioners calculated an average 
per-unit price for 7 x 20, 20 count, white folded tissue paper and an 
average per-unit price for a 1: inch x 81 foot, scarlet crepe streamer 
in U.S. dollars. See Petition at 28 and Exhibit 30. Terms of delivery 
are free on board (``FOB'') China port.Petitioners were unable to 
adjust the U.S. price for deductions resulting from foreign inland 
freight and brokerage and handling charges incurred in China since 
Petitioners could not assess the exact distances that Chinese producers 
shipped the subject merchandise. Therefore, Petitioners note that the 
antidumping margin for certain tissue paper products and certain crepe 
paper products in the Petition are understated and conservative to the 
extent that the Petitioners' calculation of U.S. Price does not deduct 
foreign inland freight and brokerage and handling charges incurred in 
China. See Petition at 28-29.

Normal Value (``NV'')

    Petitioners assert that the Department considers China to be a NME 
and therefore, constructed NV based on the factors of production 
methodology pursuant to section 773(c) of the Act. According to section 
773(c) of the Act, if subject merchandise is exported from a NME 
country, the Department shall determine NV based on the value of the 
factors of production (``FOP'') used to produce the subject 
merchandise, as valued in a surrogate market economy country. In 
accordance with section 771(18)(C)(i) of the Act, the NME status 
remains in effect until revoked by the Department. See Notice of Final 
Determination of Sales at Less Than Fair Value: Honey from the People's 
Republic of China, 66 FR 50,608, 50,609 (October 4, 2001). In previous 
cases, the Department has determined that China is a NME country. The 
NME status of China has not been revoked by the Department and, 
therefore, remains in effect for purposes of the initiation of these 
investigations. In the course of these investigations, all parties will 
have the opportunity to provide relevant information related to the 
issues of China's NME status and the granting of separate rates to 
individual exporters.
    Because China is a NME country, Petitioners stated that they valued 
all FOPs for producing certain tissue paper products and certain crepe 
paper products according to the values of those factors in India, the 
surrogate market economy country. See Notice of Final Determination of 
Sales at Less Than Fair Value: Certain Folding Gift Boxes from the 
People's Republic of China, 66 FR 58,115, 58,117 (November 20, 2001); 
Notice of Final Determination of Sales at Less Than Fair Value: Honey 
from the People's Republic of China, 66 FR 50,608, 50,609 (October 4, 
2001). The surrogate values were derived from publicly published 
domestic prices, import prices, and quoted prices obtained from Indian 
manufacturers and reprinted in industry publications. See Petition at 
21-27 and Exhibit 12. Factory overhead, general and administrative 
expenses, profit, the cost of packing, and other expenses were added to 
the cost of manufacturing associated with the production of each 
subject merchandise. See Petition at Exhibit 30.
    Petitioners assert that India was an appropriate surrogate country 
based on the Department's surrogate country selection criteria for 
determining the NVs for subject merchandise from a NME country. 
Specifically, the two selection criteria, as required by the statute 
(see section 773(c)(4) of the Act), are economic comparability and 
significant production of comparable merchandise.
    Petitioners point out that the Department has consistently found 
India to be an appropriate surrogate for China based on 1) the overall 
economic development of India according to the per capita gross 
national product (``GNP''), the national distribution of labor in 
India, and the growth rate in per capita GNP (see Memorandum from 
Catherine Bertrand, Case Analyst, Through Edward C. Yang Office 
Director, and James C. Doyle, Program Manager, To the File, Antidumping 
Investigation of Certain Hot-Rolled Carbon Steel Flat Products From the 
People's Republic of China: Selection of a Surrogate Country at 2 
(April 23, 2001)); and 2) findings that India is a ``significant 
producer'' of comparable merchandise. See section 773(c)(4) of the Act. 
Petitioners obtained promotional materials from Pudumjee Pulp and 
Paper, an Indian producer of comparable merchandise, that supports

[[Page 12131]]

a finding that India is a significant producer of certain tissue paper 
products and certain crepe paper products. See Petition at 18 and 
Exhibit 13.
    Although the usage rates of the FOPs for both certain tissue paper 
products and certain crepe paper products should be based on the actual 
consumption rates of the investigated Chinese producers (see section 
773(c)(1) of the Act and 19 CFR 351.408(a)), Petitioners were unable to 
obtain the true amounts of inputs consumed by the Chinese producers. 
Petitioners established reasonable estimates of the per-unit 
consumption amounts of the FOPs, actual consumption rates of the FOPs, 
and usage rates of the FOPs for certain tissue paper products and 
certain crepe paper products produced by the Chinese producers, based 
on the actual production experience and consumption rates of a domestic 
producer of tissue paper products and crepe paper products during the 
period July 1, 2003 through December 31, 2003, the proposed POI. See 
Petition at 19. This domestic producer's tissue paper and crepe paper 
production processes are representative of the production experiences 
of the Chinese manufacturers of subject merchandise that are exported 
to the United States. See Petition at 19 and Exhibit 14; Petition at 
20, Exhibit 14, and Third Supplemental Response at Exhibit 3, for 
revised calculations of NV and FOP. Additionally, according to 
Petitioners, the tissue paper products and crepe paper products 
produced by this domestic manufacturer are also highly representative 
of the Chinese producers tissue paper products and crepe paper products 
in size, packaging, and tissue color. See Petition at 20.
    The FOP values of the domestic producer of tissue paper products 
and crepe paper products were adjusted to account for the known 
differences in quantities and production processes used by the Chinese 
producers of subject merchandise. See Declaration (Petition at Exhibit 
5).
    However, Petitioners believe that the FOP usage rates contained in 
the Petition are conservative estimates of the actual usage rates 
incurred by Chinese manufacturers of subject merchandise because 
Petitioners believe that the domestic producers' production experience 
is more cost-efficient than the production methods of Chinese 
manufacturers of both tissue paper products and crepe paper products. 
See Petition at pages 19 and 20 and Exhibit 5, Paragraphs 10 and 11.
    Petitioners also note that the production process of tissue paper 
differs between U.S. producers and Chinese manufacturers in one 
particular respect. Typically, Chinese production of tissue paper 
products employs an extensive amount of manual labor for folding and 
packaging the merchandise. Petitioners stated that in constructing the 
normal values for Chinese tissue paper products, they used labor hour 
data from domestic companies that offer manual folding and packaging 
services to domestic producers of tissue paper, as an estimate of the 
labor hours used to fold and package the Chinese tissue paper products. 
See Petition at 20.
    Petitioners calculated the total cost for each input used to 
produce the subject merchandise by converting Indian prices denominated 
in rupees to U.S. dollars, using the average Indian rupee/U.S. dollar 
exchange rate during the period July 1, 2003 through December 31, 2003. 
The average exchange rate was calculated based on daily exchange rates 
downloaded from the ITA website. See Petition at 21.
    Factor input prices for all raw materials consist of prices from 
only non-NME countries except for Thailand, Korea, and Indonesia, 
consistent with prior Department determinations. These prices were the 
most contemporaneous prices available at the time of the Petition 
filing.

Factor of Production for: White Folded Tissue Paper, 7 x 20 Inch, 20 
Count

    Tinopal is an optical brightener used to enhance the whiteness of 
white tissue paper, the sample product chosen by Petitioners to 
calculate normal value, and was valued by Petitioners using publicly 
available Indian intelligence trade data obtained from InfoDrive. See 
Petition at 24. Indian imports of Tinopal are categorized under HTS 
number 3204.20.10 for the period June 2003 to August 2003. See Petition 
at 24 and Second Supplemental Response at Exhibit 5.

Factors of Production for: Scarlet Crepe Streamer, 1 3/4 Inch x 81 Foot

    The chemical dye used in the production of scarlet crepe streamers 
was valued using price quotes provided in Chemical Weekly, an Indian 
chemical industry journal. Petitioners stated that editions of Chemical 
Weekly provided Indian market prices, from the Mumbai Dye Market, for 
dyes used in the manufacture of tissue paper, such as ``Scarlet 4B 
(Direct Red),'' for the months of July 2003 through November 2003. 
Petitioners stated that no prices were available for December 2003. See 
Petition at 22 and Exhibits 16 & 17.
    Cartafix, a dye fixative and factor input used in the production of 
scarlet crepe streamers, is categorized under HTS number 3809.92.00. 
Petitioners valued Cartafix using publicly available Indian 
intelligence trade data from InfoDrive for the period March 2003 
through May 2003. Prices were represented from non-NME countries only, 
and these prices were the most contemporaneous data available to 
Petitioners. Accordingly, prices for Cartafix were inflated using the 
World Price Index (``WPI'') inflator. See Petition at 23 and Second 
Supplemental Response at Exhibit 5.
    Flame-proof salts are only used in the production of crepe paper 
products and were valued by Petitioners using Indian import data 
contained in the Monthly Statistics of Foreign Trade of India, 
(``MSFTI''). The surrogate value for flame-proof salts was based on 
Indian imports classified under tariff heading 3809.92.00. See Petition 
at Exhibit 24 and at page 24. The value was based on data for the 
period April 2002 through January 2003 and was inflated using the WPI 
inflator. See Second Supplemental Response at 6 and Exhibits 5 & 6.

Factors of Production for: White Folded Tissue Paper, 7 x 20 Inch, 20 
Count and Scarlet Crepe Streamer, 1 3/4 Inch x 81 Foot

    Petitioners valued wood pulp using Indian surrogate values derived 
from InfoDrive (see www.InfodriveIndia.com), a source of surrogate 
value data recognized and relied upon by the Department in other 
proceedings. The data from InfoDrive are specific to the types of wood 
pulp consumed in the production of subject merchandise and are also 
contemporaneous with the POI See Second Supplemental Response at 4 and 
Exhibit 2.
    Sulfuric acid is an input used in the production of both tissue 
paper products and crepe paper products. Petitioners stated that 
sulfuric acid was valued using price quotes, from the Mumbai and 
Bangalore chemical markets, printed in Chemical Weekly for the period 
July 2003 through December 2003. Petitioners stated that prices from 
the two markets, spanning the POI, were comparable, and the prices were 
averaged in Petitioners' normal value calculations. See Petition at 
Exhibit 18. Source documentation was included for these chemical prices 
published in Chemical Weekly. See Petition at 22 and Exhibit 19.
    Water was valued by Petitioners using the publicly available water 
tariff rates reported in the second Water Utilities Data Book: Asian 
and Pacific Region, published by the Asian Development Bank (see 
Petition at Exhibit 20) in

[[Page 12132]]

accordance with the Department's reliance on this source in the past 
(see Notice of Preliminary Results of Antidumping Duty New Shipper 
Review: Glycine from the People's Republic of China, 68 FR 13,669, 
13,771 (March 20, 2003)). Water tariff rates were provided as of 1995-
1996 for three areas in India in which the subject merchandise is 
produced: Chennai, Delhi, and Mumbai. Petitioners averaged the rupee 
per kilogram rates applicable to industrial users in Chennai and Delhi 
and factories/works/mills in Mumbai to derive an average rupee per 
kilogram price. Because Petitioners could only acquire data reported 
for a period prior to the POI, the average rupee per kilogram price was 
adjusted using the WPI inflator. See Petition at 23 and Second 
Supplemental Response at Exhibit 6.

Other Factors of Production: Packaging, Labor and Energy Costs

    Packing was calculated for both tissue paper products and crepe 
paper products using retail bags, retail labels, carton labels, 
wholesale plastic bags, and corrugated boxes. Petitioners valued retail 
labels, carton labels, and wholesale plastic bags, and corrugated boxes 
using Indian import data contained in the MSFTI. The HTS classification 
was based on Indian imports under tariff heading 4821.10.01, 
3923.21.00, 4819.10.01 and 4819.20.01, respectively. Petitioners stated 
that they calculated a surrogate value for each packing material based 
on Indian imports classified under these tariff headings for the period 
April 2002 through January 2003, which were the most contemporaneous 
data available. See Petition at 26 & 27 and Second Supplemental 
Response at Exhibits 3 & 5. Petitioners obtained the surrogate price 
for retail bags from price quotes of an Indian producer of retail bags 
of precisely the type consumed in the production of subject 
merchandise. The Indian surrogate price is specific to the types of 
retail bags consumed in the production of subject merchandise and the 
POI. See Second Supplemental Response at 5 and Exhibits 2, 3, & 5.
    Pursuant to 19 CFR Sec.  351.408(c)(3), Petitioners used the labor 
value for China as published by the Department at http://ia.ita.doc.gov/wages/01wages/01wages.html. The most current labor value 
in China is US$ 0.90 per hour based on 2001 data. See Petition at 25.
    Energy costs associated with the manufacture of tissue paper 
products and crepe paper products consist of electricity and fuel oil. 
Petitioners used Indian prices for industrial electricity and fuel oil 
values published in the 2003 second quarter edition of the 
International Energy Agency's Energy Prices and Taxes (``IEA'') 
publication, which provided data for the year 2000. See Petition at 
Exhibit 25. Because this data is for a time period outside the POI, 
they were adjusted for inflation using the WPI inflator. See Petition 
at 25, 26 and Exhibit 25 and Second Supplemental Response at Exhibit 4.
    Factory overhead, SG&A, and profit ratios for subject merchandise 
were calculated by Petitioners using the financial statement of 
Pudumjee Pulp and Paper, an Indian producer of subject merchandise. See 
Petition at 27 and Exhibit 29, and Second Supplemental Response at 6 
and 7. Factory overhead, SG&A, and Profit ratios for subject 
merchandise were 36.31 percent, 34.13 percent, and 1.59 percent 
respectively. See Petition at Exhibit 29. Depreciation was allocated 
according to the type of fixed assets to which the depreciation was 
related. See Second Supplemental Response at 6 and Petition, Exhibit 29 
at 23.
    Based on the above calculations, Petitioners estimated FOP-based 
NVs for Chinese production of certain tissue paper products and certain 
crepe paper products. See Initiation Checklist for proprietary details 
of FOP-based NVs. The estimated antidumping margin for tissue paper is 
163.36 percent and the estimated antidumping margin for crepe paper is 
266.83 percent. See Third Supplemental Response at Exhibit 3.

Fair Value Comparisons

    Based on the data provided by Petitioners, there is reason to 
believe imports of certain tissue paper products and certain crepe 
paper products from the PRC are being, or are likely to be, sold at 
less than fair value.

Allegations and Evidence of Material Injury and Causation

    Petitioners allege that the U.S. tissue paper industry and crepe 
paper industry are being materially injured, or threatened with 
material injury, by reason of the imports of the subject merchandise 
sold at less than NV from the PRC.
    Petitioners contend that the tissue paper and crepe paper 
industry's injured condition is evident from examining economic 
indicators preceding the POI and during the POI, such as increase in 
volume and market share of imports, decline in domestic prices, 
decrease in U.S. shipments, decline in operating income, decrease of 
domestic market share, drop in domestic capacity utilization rates, 
lost sales and lost revenue. See Petition at pages 35-45; Initiation 
Checklist at Attachment III; Second Supplemental Response at pages 11-
12.

Initiation of Antidumping Investigations

    Based on our examination of the Petition covering certain tissue 
paper products and certain crepe paper products, we find that the 
Petition meets the requirements of section 732 of the Act. Therefore, 
we are initiating two antidumping duty investigations to determine 
whether imports of certain tissue paper products and certain crepe 
paper products 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 determinations no later than 140 days after the date of 
this initiation, or July 26, 2004.

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 representatives of 
the government of the PRC. We will attempt to provide a copy of the 
public version of the Petition to each exporter named in the Petition, 
as provided in section 19 CFR 351.203(c)(2).

International Trade Commission Notification

    The ITC will preliminarily determine on April 2, 2004, whether 
there is reasonable indication that imports of certain tissue paper 
products and certain crepe paper products from the PRC are causing, or 
threatening, material injury to a U.S. industry. A negative ITC 
determination will result in the investigations being terminated with 
respect to these products; otherwise, these investigations will proceed 
according to statutory and regulatory time limits.

Administrative Protective Order (``APO'') Access

    APO access in these investigations will be granted under two 
separate APOs, with separate APO and Public Service Lists. All 
interested parties who had been granted APO status under the initial 
case number assigned to tissue paper products and crepe paper products 
from the People's Republic of China will need to re-apply for APO 
access in the now separate investigation of crepe paper products under 
the case number A-570-895. The initial APO listing both products will 
be amended for the tissue paper products investigation. Any party who 
no longer qualifies to be an interested party in the tissue paper 
products investigation will

[[Page 12133]]

need to withdraw their APO application as it pertains to this 
investigation.
    This notice is issued and published pursuant to section 777(i) of 
the Act.

    Dated: March 8, 2004.
James J. Jochum,
Assistant Secretary for Import Administration.
[FR Doc. 04-5798 Filed 3-12-04; 8:45 am]
BILLING CODE 3510-DS-S