[Federal Register Volume 70, Number 53 (Monday, March 21, 2005)]
[Notices]
[Pages 13456-13458]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E5-1222]


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DEPARTMENT OF COMMERCE

International Trade Administration

[A-560-817]


Notice of Final Determination of Sales at Less Than Fair Value: 
Bottle-Grade Polyethylene Terephthalate (PET) Resin From Indonesia

AGENCY: Import Administration, International Trade Administration, 
Department of Commerce.
    Final Determination: The Department of Commerce (``the 
Department'') determines that PET resin from Indonesia is being, or is 
likely to be, sold in the United States at less than fair value, as 
provided in section 735 of the Tariff Act of 1930, as amended (``the 
Act''). The final weighted-average dumping margins are listed below in 
the section entitled ``Continuation of Suspension of Liquidation.''

DATES: Effective Date: March 21, 2005.

FOR FURTHER INFORMATION CONTACT: Andrew McAllister or Scott Holland, 
AD/CVD Operations, Office 1, Import Administration, International Trade 
Administration, U.S. Department of Commerce, 14th Street and 
Constitution Avenue, NW., Washington, DC 20230; telephone (202) 482-
1174 and (202) 482-1279, respectively.

SUPPLEMENTARY INFORMATION: 

Background

    Since the publication of the preliminary results of this review 
(see Notice of Preliminary Determination of Sales at Less Than Fair 
Value: Bottle-Grade Polyethylene Terephthalate (PET) Resin from 
Indonesia, 69 FR 62861 (October 28, 2004) (``Preliminary 
Determination'')), the following events have occurred:
    On November 3, 2004, the Department published in the Federal 
Register an extension of the time limit for the final determination in 
the antidumping duty investigation to no later than March 14, 2005, in 
accordance with the Act. See Notice of Postponement of Final 
Antidumping Duty Determination: Bottle-Grade Polyethylene Terephthalate 
(PET) Resin from Indonesia, 69 FR 64026 (November 3, 2004).
    In October and November 2004, we conducted verifications of the 
sales and cost of production (``COP'') questionnaire responses 
submitted by P.T. Indorama Synthetics Tbk (``Indorama''). The sales and 
cost verification reports were issued on January 6 and 7, 2005, 
respectively. See Memoranda to the File, ``Verification of the Sales 
Responses of P.T. Indorama Synthetics, Tbk in the Antidumping Duty 
Investigation of Bottle-Grade Polyethylene Terephthalate (``PET'') 
Resin from Indonesia,'' (``Indorama SVR'') dated January 6, 2005; and 
``Verification Report on the Cost of Production and Constructed Value 
Data Submitted by P.T. Indorama Synthetics, Tbk,'' (``Indorama CVR'') 
dated January 7, 2005. These reports are on file in the Central Records 
Unit, Room B-099 of the main Department building (``CRU'').
    On January 25, 2005, we received case briefs from the United States 
PET Resin Producers Coalition (``the petitioner'') and Indorama. On 
January 31, 2005, we received rebuttal briefs from the petitioner and 
Indorama. At the request of interested parties, the Department held a 
public hearing on February 3, 2005.

Scope of Investigation

    The merchandise covered by this investigation is polyethylene 
terephthalate (``PET'') bottle-grade resin, defined as having an 
intrinsic viscosity of at least 0.68 deciliters per gram but not more 
than 0.86 deciliters per gram. The scope includes bottle-grade PET 
resin that contains various additives introduced in the manufacturing 
process. The scope does not include post-consumer recycle (``PCR'') or 
post-industrial recycle (``PIR'') PET resin; however, included in the 
scope is any bottle-grade PET resin blend of virgin PET bottle-grade 
resin and recycled PET (``RPET''). Waste and scrap PET are outside the 
scope of the investigation. Fiber-grade PET resin, which has an 
intrinsic viscosity of less than 0.68 deciliters per gram, is also 
outside the scope of the investigations.
    The merchandise subject to this investigation is properly 
classified under subheading 3907.60.0010 of the Harmonized Tariff 
Schedule of the United States (``HTSUS''); however, merchandise 
classified under HTSUS subheading 3907.60.0050 that otherwise meets the 
written description of the scope is also subject to these 
investigations. Although the HTSUS subheadings are provided for 
convenience and customs purposes, the written description of the 
merchandise under investigation is dispositive.

Period of Investigation

    The period of investigation (``POI'') is January 1, 2003, through 
December 31, 2003. This period corresponds to the four most recent 
fiscal quarters prior to the filing of the petition on March 24, 2004.

Verification

    As provided in section 782(i) of the Act, we conducted verification 
of the sales and cost information submitted by Indorama. We used 
standard verification procedures, including examination of the relevant 
sales, cost, and financial records.

Analysis of Comments Received

    All issues raised in the case and rebuttal briefs by parties to 
this review are addressed in the ``Issues and Decision Memorandum for 
the Final Determination in the Antidumping Duty Investigation of 
Bottle-Grade Polyethylene Terephthalate (PET) Resin from Indonesia'' 
from Barbara E. Tillman, Acting Deputy Assistant Secretary for Import 
Administration, to Joseph A. Spetrini, Acting Assistant Secretary for 
Import Administration, dated March 14, 2005 (``Decision Memorandum''), 
which is hereby adopted by this notice. Attached to this notice as an 
appendix is a list of the issues which parties have raised and to which 
we have responded in the Decision Memorandum. Parties can find a 
complete discussion of all issues raised in this investigation and the 
corresponding recommendations in this public memorandum which is on 
file in the Department's CRU. In addition, a complete version of the 
Decision Memorandum can be accessed directly on the Web at http://ia.ita.doc.gov/frn/index.html. The paper copy and electronic version of 
the Decision Memorandum are identical in content.

Facts Otherwise Available

    For the final determination, the Department continues to find that 
P.T. SK Keris (``SK Keris'') and P.T. Polypet Karyapersada 
(``Polypet''), both producers/exporters of PET resin from Indonesia, 
and mandatory respondents in these proceedings, did not act to the

[[Page 13457]]

best of their abilities by failing to provide information requested by 
the Department. Thus, the Department continues to find that the use of 
adverse facts available (``AFA'') is warranted under section 776(a)(2) 
of the Act. See Preliminary Determination at 62861-62863.

Fair Value Comparisons

    We calculated export price (``EP''), constructed export price 
(``CEP''), normal value (``NV''), COP, and constructed value (``CV'') 
based on the same methodologies used in the Preliminary Determination 
with the following exception(s):

Indorama

     We made changes based on information in the minor 
corrections presented at the sales verification. See Indorama SVR.
     We revised the calculation of CEP profit. See Decision 
Memorandum at Comment 3.
     We revised the ratio for indirect selling expenses 
incurred in Indonesia for home market and U.S. sales. See Decision 
Memorandum at Comments 4 and 5; see also Memorandum to File, ``Final 
Determination Calculation Memorandum for P.T. Indorama Synthetics 
Tbk,'' dated March 14, 2005.
     We adjusted the cost for inputs obtained from an 
affiliated supplier at less than arm's length prices. As a result, 
Indorama's cost of manufacture has increased. See Memorandum to Neal 
Halper, ``Cost of Production and Constructed Value Calculation 
Adjustments for the Final Determination--P.T. Indorama Synthetics, 
Tbk'' (March 14, 2004) (``Cost Calculation Memorandum''), page 1.
     We revised Indorama's general and administrative expense 
(``G&A'') ratio by including scrap revenue as an offset to cost of 
goods sold (``COGS''). See Cost Calculation Memorandum, pages 1-2.
     We recalculated Indorama's financial expense ratio. We 
deducted the short-term interest income from total interest expenses 
and included a scrap revenue offset in the COGS. See Cost Memorandum, 
page 2.

Results of the COP Test

    Pursuant to section 773(b)(1), where less than 20 percent of the 
respondent's sales of a given product are at prices less than the COP, 
we do not disregard any below-cost sales of that product, because we 
determine that in such instances the below-cost sales were not made in 
``substantial quantities.'' Where 20 percent or more of a respondent's 
sales of a given product are at prices less than the COP, we determine 
that the below-cost sales represent ``substantial quantities'' within 
an extended period of time, in accordance with section 773(b)(1)(A) of 
the Act. In such cases, we also determine whether such sales were made 
at prices which would not permit recovery of all costs within a 
reasonable period of time, in accordance with section 773(b)(1)(B) of 
the Act. If so, we disregard the below-cost sales.
    Because less than 20 percent of Indorama's home market sales within 
an extended period of time were made at prices below the COP, we are 
not excluding any sales as the basis for determining NV, in accordance 
with section 773(b)(1) of the Act.

Currency Conversions

    We made currency conversions into U.S. dollars in accordance with 
section 773A(a) of the Act based on the exchange rates in effect on the 
dates of the U.S. sales as certified by the Federal Reserve.

Continuation of Suspension of Liquidation

    In accordance with section 735(c)(1)(B) of the Act, we are 
directing U.S. Customs and Border Protection (``CBP'') to continue to 
suspend liquidation of all imports of subject merchandise from 
Indonesia, except imports of subject merchandise produced and exported 
by Indorama, that are entered, or withdrawn from warehouse, for 
consumption on or after October 28, 2004, the date of publication of 
the Preliminary Determination in the Federal Register. CBP shall 
continue to require a cash deposit or the posting of a bond equal to 
the weighted-average amount by which the NV exceeds the EP or CEP, as 
indicated in the chart below. These suspension-of-liquidation 
instructions will remain in effect until further notice. The weighted-
average dumping margins are as follows:

------------------------------------------------------------------------
                                                              Weighted-
                                                               average
                   Exporter/manufacturer                        margin
                                                              percentage
------------------------------------------------------------------------
P.T. Indorama Synthetics Tbk...............................         0.00
P.T. Polypet Karyapersada..................................        27.61
P.T. SK Keris..............................................        27.61
All Others.................................................        18.41
------------------------------------------------------------------------

All Others

    All companies that we examined have either a zero margin or rates 
based on total AFA. Therefore, for purposes of determining the all-
others rate and pursuant to section 735(c)(5)(B) of the Act, we have 
calculated a simple average of the three margin rates we have 
determined in the investigation.

ITC Notification

    In accordance with section 735(d) of the Act, we have notified the 
International Trade Commission (``ITC'') of our determination. As our 
final determination is affirmative, the ITC will, within 45 days, 
determine whether these imports are materially injuring, or threatening 
material injury to, the U.S. industry. If the ITC determines that 
material injury, or threat of material injury, does not exist, the 
proceeding will be terminated and all securities posted will be 
refunded or canceled. If the ITC determines that such injury does 
exist, the Department will issue an antidumping duty order pursuant to 
section 736(a) of the Act.

Notification Regarding APOs

    This notice also serves as the only reminder to parties subject to 
the administrative protective order (``APO'') of their responsibility 
concerning the disposition of proprietary information disclosed under 
APO in accordance with 19 CFR 351.305(a)(3), which continues to govern 
business proprietary information in this segment of the proceeding. 
Timely written notification of return/destruction of APO material or 
conversion to judicial protective order is hereby requested. Failure to 
comply with the regulation and the terms of an APO is a sanctionable 
violation.
    This determination is issued and published in accordance with 
sections 735(d) and 777(i)(1) of the Act.

    Dated: March 14, 2005.
Joseph A. Spetrini,
Acting Assistant Secretary for Import Administration.

Appendix I--List of Comments in the Issues and Decision Memorandum

Comment 1: Date of Sale for U.S. DDP Sales
Comment 2: Classification of U.S. Sales
Comment 3: Calculation of CEP Profit
Comment 4: Allocation of Indirect Selling Expenses for Home Market 
and Export Sales
Comment 5: Indirect Selling Expenses Incurred by Indorama's Billing 
Entity
Comment 6: Indirect Selling Expenses Incurred in the United States 
by Indorama and its Billing Entity
Comment 7: Inclusion of Bank Charges as a Direct Selling Expense
Comment 8: Treatment of Sample Sales
Comment 9: Inclusion of Negative Imputed Credit Expenses
Comment 10: Untimely Sales Reconciliation Submission
Comment 11: Home Market Viability Test
Comment 12: Affiliated Input Purchases
Comment 13: Gains on Sale of Assets and Miscellaneous Revenue

[[Page 13458]]

Comment 14: Scrap Revenue Offset
Comment 15: Divisional G&A and Net Interest Expense
Comment 16: Short-Term Interest Income

[FR Doc. E5-1222 Filed 3-18-05; 8:45 am]
BILLING CODE 3510-DS-P