Federal Register, Volume 74 Issue 4 (Wednesday, January 7, 2009)

[Federal Register Volume 74, Number 4 (Wednesday, January 7, 2009)]
[Notices]
[Pages 673-681]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E9-00062]

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DEPARTMENT OF COMMERCE

International Trade Administration

[A-570-827]

Certain Cased Pencils from the People's Republic of China;
Preliminary Results and Partial Rescission of Antidumping Duty
Administrative Review

AGENCY: Import Administration, International Trade Administration,
Department of Commerce.
SUMMARY: The Department of Commerce (``the Department'') has
preliminarily determined that the respondents in this review, covering
the period December 1, 2006, through November 30, 2007, have made sales
of subject merchandise at less than normal value. If these preliminary
results are adopted in the final results of this review, we will
instruct U.S. Customs and Border Protection (``CBP'') to assess
antidumping duties on all appropriate entries. The Department invites
interested parties to comment on these preliminary results.

EFFECTIVE DATE: January 7, 2009.

FOR FURTHER INFORMATION CONTACT: Alexander Montoro or David Layton, 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) 482-0238
and (202) 482-0371, respectively.

SUPPLEMENTARY INFORMATION:

Background

On December 28, 1994, the Department published an antidumping duty
order on certain cased pencils from the People's Republic of China
(``PRC''). See Antidumping Duty Order: Certain Cased Pencils from the
People's Republic of China, 59 FR 66909 (December 28, 1994).
On December 3, 2007, the Department published a notice of
``Opportunity to Request Administrative Review'' of the antidumping
duty order on certain cased pencils from the PRC covering the period of
review (``POR'') December 1, 2006, through November 30, 2007. See
Antidumping or Countervailing Duty Order, Finding, or Suspended
Investigation; Opportunity to Request Administrative Review, 72 FR
67889 (December 3, 2007). On December 26, 2007, in accordance with 19
CFR 351.213(b), Shandong Rongxin Import and Export Co., Ltd.
(``Rongxin''), a PRC exporter/producer, requested a review of itself.
On December 31, 2007, the following exporters/producers requested
reviews of themselves in accordance with 19 CFR 351.213(b): China First
Pencil Co., Ltd. (``China First''), Shanghai Three Star Stationery
Industry Corp. (``Three Star''), and Oriental International Holding
Shanghai Foreign Trade Co., Ltd. (``SFTC''). On December 31, 2007, the
petitioners \1\ requested a review of the following companies: China
First (including subsidiaries Shanghai First Writing Instrument Co.,
Ltd. (``Shanghai First''), Shanghai Great Wall Pencil Co., Ltd.
(``Great Wall''), and China First Pencil Fang Zheng Co., Ltd. (``Fang
Zheng''), Three Star, Guangdong Provincial Stationery & Sporting Goods
Import & Export Corporation (``Guangdong''), Rongxin, Tianjin Custom
Wood Processing Co., Ltd. (``Tianjin''), Beijing Dixon Stationery
Company Ltd. (``Dixon''), and Anhui Import & Export Co., Ltd.
(``Anhui'').
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\1\ The petitioners include Sanford L.P., Musgrave Pencil
Company, RoseMoon Inc., and General Pencil Company.
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On January 28, 2008, the Department published a notice of
initiation for this administrative review covering the companies listed
in the requests received from interested parties. See Initiation of
Antidumping and Countervailing Duty Administrative Reviews and Request
for Revocation in Part, 73 FR 4829 (January 28, 2008). On May 6, 2008,
the petitioners requested that the Department conduct verification of
the information the Department will rely upon in the final results of
this review. On August 25, 2008, we extended the time limit for the
preliminary results in this review until December 30, 2008. See Certain
Cased Pencils from the People's Republic of China: Extension of Time
Limit for the Preliminary Results of the Antidumping Duty
Administrative Review, 73 FR 49993 (August 25, 2008).

Respondent Selection

Section 777A(c)(1) of the Tariff Act of the 1930, as amended (``the
Act''), directs the Department to calculate individual dumping margins
for each known producer or exporter of the subject merchandise. Because
it was not practicable for the Department to individually examine all
of the companies covered by the review, the Department limited its
examination to a reasonable number of producers/exporters, accounting
for the greatest possible export volume, pursuant to section
777A(c)(2)(B) of the Act. Therefore, the Department selected China
First, Three Star, and Rongxin as the mandatory respondents in this
review. See Memorandum from Alexander Montoro, International Trade
Compliance Analyst, to Susan H. Kuhbach, Director of AD/CVD Operations
Office 1, entitled ``Selection of Respondents for the Antidumping Duty
Review of Certain Cased Pencils from the People's Republic of China,''
June 17, 2008.

Partial Rescission

On July 3, 2008, Dixon requested that the Department rescind the
administrative review with respect to Dixon and certified that it had
no exports, sales or entries of subject merchandise to the United
States during the POR. We reviewed CBP import data and found no
evidence that Dixon had any shipments of subject merchandise during the
POR. See Memorandum from Alexander Montoro to the File, entitled
``Intent to Rescind in Part the Antidumping Duty Administrative

[[Page 674]]

Review on Certain Cased Pencils from the People's Republic of China'',
August 7, 2008, (``Intent to Rescind Memo''). In addition, on July 17,
2008, we made a ``No Shipments Inquiry'' to CBP to confirm that there
were no exports of subject merchandise by Dixon during the POR. We
asked CBP to notify us within ten days if CBP ``has contrary
information and is suspending liquidation'' of subject merchandise
exported by Dixon. CBP did not reply with contrary information. The
Department provided interested parties in this review until August 14,
2008, to submit comments on the Intent to Rescind Memo. No interested
party submitted any comments. Accordingly, we are preliminarily
rescinding this review with respect to Dixon.

Non-Market Economy Country Status

In every case conducted by the Department involving the PRC, the
PRC has been treated as a non-market economy (``NME'') country. In
accordance with section 771(18)(C)(i) of the Act, any determination
that a foreign country is an NME country shall remain in effect until
revoked by the administering authority. See, e.g., Brake Rotors From
the People's Republic of China: Final Results and Partial Rescission of
the 2004-2005 Administrative Review and Notice of Rescission of 2004-
2005 New Shipper Review, 71 FR 66304 (November 14, 2006). None of the
parties to this proceeding has contested such treatment. Accordingly,
we calculated normal value (``NV'') in accordance with section 773(c)
of the Act, which applies to NME countries.

Surrogate Country and Surrogate Values

Section 773(c)(1) of the Act directs the Department to base NV on
the NME producer's factors of production (``FOPs''), valued in a
surrogate market economy country or countries considered to be
appropriate by the Department if NV cannot be determined pursuant to
section 773(a) of the Act. In accordance with section 773(c)(4) of the
Act, the Department valued the FOPs, to the extent possible, using the
costs of the FOPs in one or more market-economy countries that are at a
level of economic development comparable to that of the PRC and are
significant producers of comparable merchandise. The Department
determined that India, Indonesia, the Philippines, Colombia and
Thailand are countries comparable to the PRC in terms of economic
development. See Memorandum from Carole Showers, Acting Director,
Office of Policy, to Susan H. Kuhbach, Director, Office 1, July 9,
2008.
On November 14, 2008, the Department solicited comments on
surrogate country selection from interested parties. The Department
received comments from the petitioners on November 26, 2008. On
November 26, 2008, the Department also received surrogate-value
information from the petitioner, China First, and Three Star. On
December 5, 2008, and December 8, 2008, the Department received
rebuttal factual information and comments on factor valuation from the
petitioners and China First and Three Star (``China First-Three
Star''), respectively. For a detailed discussion of the Department's
selection of surrogate values and financial ratios, see ``Factor
Valuations'' section below. See also Memorandum from the Team to the
File, entitled ``2006-2007 Antidumping Duty Administrative Review of
Certain Cased Pencils from the People's Republic of China: Factor
Valuation for the Preliminary Results'', December 30, 2008, (``Factor
Valuation Memorandum''), which is on file in the Central Records Unit
(``CRU'') in Room 1117 of the main Department of Commerce building.
We determined that India is comparable to the PRC in terms of per
capita gross national product and the national distribution of labor.
Furthermore, India is a significant producer of comparable merchandise.
See Memorandum from Alexander Montoro to the File entitled, ``2006-2007
Antidumping Duty Administrative Review on Certain Cased Pencils from
the People's Republic of China: Selection of a Surrogate Country,''
December 30, 2008.
Moreover, it is the Department's practice to select an appropriate
surrogate country based on the availability and reliability of data
from these countries. See Department Policy Bulletin No. 04.1: Non-
Market Economy Surrogate Country Selection Process, dated March 1,
2004. The Department finds India to be a reliable source for surrogate
values because India is at a comparable level of economic development
pursuant to section 773(c)(4) of the Act, is a significant producer of
comparable merchandise, and has publicly available and reliable data.
Furthermore, the Department notes that India has been the primary
surrogate country in past segments, and the only surrogate value data
submitted on the record are from Indian sources. Given the above facts,
the Department has selected India as the primary surrogate country for
this review.

Scope of the Order

Imports covered by the order are shipments of certain cased pencils
of any shape or dimension (except as described below) which are writing
and/or drawing instruments that feature cores of graphite or other
materials, encased in wood and/or man-made materials, whether or not
decorated and whether or not tipped (e.g., with erasers, etc.) in any
fashion, and either sharpened or unsharpened. The pencils subject to
the order are currently classifiable under subheading 9609.10.00 of the
Harmonized Tariff Schedule of the United States (``HTSUS'').
Specifically excluded from the scope of the order are mechanical
pencils, cosmetic pencils, pens, non-cased crayons (wax), pastels,
charcoals, chalks, and pencils produced under U.S. patent number
6,217,242, from paper infused with scents by the means covered in the
above-referenced patent, thereby having odors distinct from those that
may emanate from pencils lacking the scent infusion. Also excluded from
the scope of the order are pencils with all of the following physical
characteristics: (1) length: 13.5 or more inches; (2) sheath diameter:
not less than one-and-one quarter inches at any point (before
sharpening); and (3) core length: not more than 15 percent of the
length of the pencil.
In addition, pencils with all of the following physical
characteristics are excluded from the scope of the order: novelty jumbo
pencils that are octagonal in shape, approximately ten inches long, one
inch in diameter before sharpening, and three-and-one eighth inches in
circumference, composed of turned wood encasing one-and-one half inches
of sharpened lead on one end and a rubber eraser on the other end.
Although the HTSUS subheading is provided for convenience and
customs purposes, the written description of the scope of the order is
dispositive.

Affiliation - China First and Three Star

To the extent that section 771(33) of the Act does not conflict
with the Department's application of separate rates and enforcement of
the NME provision, section 773(c) of the Act, the Department will
determine that exporters and/or producers are affiliated if the facts
of the case support such a finding.\2\ For the reasons discussed

[[Page 675]]

below, we find that this condition has not prevented us from examining
in this administrative review whether China First and its subsidiary
producers\3\ are affiliated with Three Star.
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\2\ See, e.g., Certain Preserved Mushrooms From the People's
Republic of China; Preliminary Results of Antidumping Duty
Administrative Review, 71 FR 64930, 64934 (November 6, 2006)
(unchanged in the final results, 72 FR 44827 (August 9, 2007)), and
Certain Preserved Mushrooms From the People's Republic of China:
Preliminary Results and Partial Rescission of Fifth Antidumping Duty
Administrative Review, 70 FR 10965, 10969 (March 7, 2005)
(``Mushrooms Fifth Review Prelim'') (unchanged in the final results,
70 FR 54361 (September 14, 2005)).
\3\ China First's pencil-producing subsidiaries include the
following companies: Shanghai First, Great Wall, and Fang Zheng.
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In prior administrative reviews involving China First and Three
Star, the Department found China First to be affiliated with Three Star
as a result of Shanghai Light Industry, Ltd.'s (``SLI'') direct
oversight and control over both China First and Three Star.\4\
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\4\ See, e.g., Certain Cased Pencils from the People's Republic
of China; Final Results and Partial Rescission of Antidumping Duty
Administrative Review,71 FR 38366 (July 6, 2006) and accompanying
Issues and Decision Memorandum at Comment 7.
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In this review, as in past administrative reviews, China First and
Three Star claim that they are not affiliated and should not be
collapsed. These respondents contend that SLI's transfer of its
oversight responsibilities for China First and Three Star to the
Huangpu District State Assets Administration Office (``HSAAO'') on
October 11, 2005, and September 8, 2005, respectively, is additional
evidence of their non-affiliation.\5\
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\5\ See page 2 of Three Star's section A response, and pages A-4
and A-5 of China First's section A response, August 1, 2008.
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Based on our analysis, we preliminarily find that China First and
its pencil-producing subsidiaries are affiliated with Three Star,
pursuant to section 771(33)(F) of the Act, because of the common
control exercised by HSAAO. See Memorandum From Team to Susan H.
Kuhbach, Director, Office 1, entitled ``Certain Cased Pencils from the
People's Republic of China: Whether to Continue To Collapse China First
and its Pencil-Producing Subsidiaries with Three Star,'' December 30,
2008 (``Affiliation/Collapsing Memo''). The basis of our finding is
that the facts have not changed from previous reviews in which we found
these parties to be affiliated.
In the four most recent administrative reviews of Pencils from
China, the Department found China First and Three Star to be
affiliated, in large part based on: (1) a 1997 public filing by China
First that indicated that China First's shareholders voted to merge
with Three Star; and (2) common oversight of the two firms by SLI, a
government-owned assets management entity. Throughout the four reviews,
both companies consistently asserted that the 1997 merger was not
implemented and that the two companies, are in, fact unaffiliated
competitors. However, neither China First nor Three Star was able to
document that the 1997 shareholder decision to merge was reversed.
In this review, China First and Three Star continue to claim that
the merger was never completed, but have yet to provide documents
specifically supporting this claim. The only change is the transfer of
SLI's administrative oversight of China First and Three Star to HSAAO.
China First and Three Star describe the oversight duties and asset
management of HSAAO to be essentially the same as those of SLI.
Therefore, we preliminarily determine that common control of China
First and Three Star continues and that they are affiliated under
section 771(33)(F) of the Act.
The Department intends to obtain additional information on the
relationship of these companies for consideration in the final results.

Collapsing - China First and Three Star

Pursuant to 19 CFR 351.401(f), the Department will collapse
producers and treat them as a single entity where (1) those producers
are affiliated, (2) the producers have production facilities for
producing similar or identical products that would not require
substantial retooling of either facility in order to restructure
manufacturing priorities, and (3) there is a significant potential for
manipulation of price or production. We also note that the rationale
for collapsing, to prevent manipulation of price and/or production (see
19 CFR 351.401(f)), applies to both producers and exporters, if the
facts indicate that producers of like merchandise are affiliated as a
result of their mutual relationship with an exporter.
To the extent that this provision does not conflict with the
Department's application of separate rates and enforcement of the NME
provision, section 773(c) of the Act, the Department will collapse two
or more affiliated entities in a case involving an NME country if the
facts of the case warrant such treatment. Furthermore, we note that the
factors listed in 19 CFR 351.401(f)(2) are not exhaustive in the
context of an NME investigation or administrative review, other factors
unique to the relationship of business entities within the NME may lead
the Department to determine that collapsing is either warranted or
unwarranted, depending on the facts of the case. See Hontex
Enterprises, Inc. v. United States, 248 F. Supp. 2d 1323, 1342 (Ct.
Int'l. Trade 2003) (noting that the application of collapsing in the
NME context may differ from the standard factors listed in the
regulation).
In summary, if there is evidence of significant potential for
manipulation or control between or among producers which produce
similar and/or identical merchandise, but may not all produce their
product for sale to the United States, the Department may find such
evidence sufficient to apply the collapsing criteria in an NME context
in order to determine whether all or some of those affiliated producers
should be treated as one entity. See, e.g., Mushrooms Fifth Review
Prelim, 70 FR at 10971 (unchanged in final results, 70 FR 54361
(September 14, 2005)); and Certain Preserved Mushrooms From the
People's Republic of China: Final Results of Sixth Antidumping Duty New
Shipper Review and Final Results and Partial Rescission of the Fourth
Antidumping Duty Administrative Review, 69 FR 54635, 54637 (September
9, 2004), and accompanying Issues and Decision Memorandum at Comment 1.
As noted above in the ``Affiliation - China First and Three Star''
section of this notice, we find a sufficient basis to conclude that
China First and its pencil-producing subsidiaries and Three Star are
affiliated through the common control by HSAAO, pursuant to section
771(33)(F) of the Act. All of China First's three pencil-producing
subsidiaries and Three Star produced cased pencils during the POR,
which would be subject to the antidumping duty order if this
merchandise entered the United States (see FOP data submitted by China
First and Three Star in their section D responses, August 18, 2008).
Therefore, we find that the first and second collapsing criteria are
met because in addition to being affiliated, these producers have
production facilities for producing similar or identical products, such
that no retooling at any of the three facilities is required in order
to restructure manufacturing priorities.
Finally, we find that the third collapsing criterion is met in this
case because, a significant potential for manipulation of price or
production exists among China First and Three Star. In determining
whether a significant potential for manipulation exists, the
regulations provide that the Department may consider various factors,
including (1) the level of common ownership, (2) the extent to which
managerial employees or board members of one firm sit on the board of
directors of an affiliated firm, and (3) whether the operations of the
affiliated firms are intertwined. See Gray Portland Cement and Clinker
From Mexico: Final Results of Antidumping Duty Administrative

[[Page 676]]

Review, 63 FR 12764, 12774 (March 16, 1998) and Notice of Final
Determination of Sales at Less Than Fair Value: Collated Roofing Nails
From Taiwan, 62 FR 51427, 51436 (October 1, 1997). See Affiliation/
Collapsing Memo for further discussion. In this case, there is a
significant potential for manipulation of price or production because
China First and Three Star have common ownership as demonstrated by the
fact that HSAAO has administrative oversight over both of them.
For the reasons explained more fully in the Affiliation/Collapsing
Memo and pursuant to 19 CFR 351.401(f), we have preliminarily collapsed
China First and its pencil-producing subsidiaries with Three Star.

Separate Rates Determination

A designation as an NME remains in effect until it is revoked by
the Department. See section 771(18)(c) of the Act. Accordingly, the
Department begins with a rebuttable presumption that all companies
within the country are subject to government control and, thus, should
be assessed a single antidumping duty deposit rate (i.e., a country-
wide rate). See Notice of Final Determination of Sales at Less Than
Fair Value, and Affirmative Critical Circumstances, In Part: Certain
Lined Paper Products From the People's Republic of China, 71 FR 53079
(September 8, 2006); Final Determination of Sales at Less Than Fair
Value and Final Partial Affirmative Determination of Critical
Circumstances: Diamond Sawblades and Parts Thereof from the People's
Republic of China, 71 FR 29303 (May 22, 2006).
It is the Department's standard policy to assign all exporters of
the merchandise subject to review in NME countries a single rate unless
an exporter can affirmatively demonstrate an absence of government
control, both in law (de jure) and in fact (de facto), with respect to
exports. To establish whether a company is sufficiently independent to
be entitled to a separate, company-specific rate, the Department
analyzes each exporting entity in an NME country under the test
established in Final Determination of Sales at Less than Fair Value:
Sparklers From the People's Republic of China, 56 FR 20588 (May 6,
1991) (``Sparklers''), as amplified by Notice of Final Determination of
Sales at Less Than Fair Value: Silicon Carbide From the People's
Republic of China, 59 FR 22585 (May 2, 1994) (``Silicon Carbide'').
Regarding the mandatory respondents, China First and Three Star are
a joint stock limited company and a company ``owned by all of the
people,'' respectively.\6\ A portion of China First's shares are held
in trust in part by HSAAO, which is also owned by ``all of the
people.''\7\ HSAAO, as trustee, has oversight over Three Star's assets.
As discussed above in the ``Collapsing-China First and Three Star''
section of this notice, we are preliminarily treating China First and
Three Star as a collapsed entity. Consequently, we are considering
whether the collapsed entity as a whole is entitled to a separate rate.
This decision is specific to the facts presented in this review and is
based on several considerations, including the structure of the
collapsed entity, the level of control between/among affiliates, and
the level of participation by each affiliate in the proceeding. Given
the unique relationships which arise in NMEs between individual
companies and the government, a separate rate will be granted to the
collapsed entity only if the facts, taken as a whole, support such a
finding.
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\6\ See page A-2 of China First's August 1, 2008, Section A
Response and page 2 of Three Star's August 1, 2008 Section A
Response.
\7\ See page A-5 of China First's August 1, 2008, Section A
Response.
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The other mandatory respondent, Rongxin, is a limited liability
company.
Five respondents subject to this review were not selected as
mandatory respondents.\8\ We issued separate rate applications and
certifications to all five of these companies. One of these
respondents, Dixon, requested rescission on the basis that it had no
shipments in the POR, as discussed above. SFTC filed its separate rate
certification on July 24, 2008. The remaining three non-mandatory
respondents did not submit either a separate rates certification or
application. One of these three companies, Tianjin, qualified for a
separate rate in an earlier administrative review. See Certain Cased
Pencils from the People's Republic of China; Final Results and Partial
Rescission of Antidumping Duty Administrative Review, 68 FR 43082,
43084 (July 21, 2003). However, because Tianjin did not submit a
separate rate certification in the instant review, it will now be
treated as part of the PRC-wide entity. Consequently, Anhui, Guangdong,
and Tianjin have not satisfied the criteria for separate rates for the
POR and are considered as being part of the PRC-wide entity.
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\8\ Dixon, SFTC, Anhui, Guangdong, and Tianjin.
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Our analysis of whether the export activities of Rongxin, the China
First/Three Star collapsed entity, and SFTC are independent from
government control follows.

Absence of De Jure Control

The Department considers the following criteria in determining
whether an individual company may be granted a separate rate: (1) an
absence of restrictive stipulations associated with the individual
exporter's business and export licenses; (2) any legislative enactments
decentralizing control of companies; and (3) any other formal measures
by the government decentralizing control of companies. See Sparklers,
56 FR at 20589.
The China First Three Star collapsed entity and Rongxin have placed
on the administrative record the following documents to demonstrate
absence of de jure control: the 1994 ``Foreign Trade Law of the
People's Republic of China;'' the ``Company Law of the PRC,'' effective
as of July 1, 1994; and ``The Enterprise Legal Person Registration
Administrative Regulations,'' promulgated on June 13, 1988. In other
cases involving products from the PRC, these and other respondents have
submitted the following additional documents to demonstrate absence of
de jure control, and the Department has placed these additional
documents on the record of this segment, as well: the ``Law of the
People's Republic of China on Industrial Enterprises Owned by the Whole
People,'' adopted on April 13, 1988; and the 1992 ``Regulations for
Transformation of Operational Mechanisms of State-Owned Industrial
Enterprises.'' See December 30, 2008, memorandum to the file which
places the above-referenced laws on the record of this segment.
In its separate rates certification, SFTC certified that during the
POR: (1) as with the segment of the proceeding in which the firm was
previously granted a separate rate (``previous Granting Period''),
there were no government laws or regulations that controlled the firm's
export activities; (2) the ownership under which the firm registered
itself with the official government business license issuing authority
remains the same as for the previous Granting Period; (3) the firm had
a valid PRC Export Certificate of Approval, now referred to and labeled
as a Registration Form for Foreign Trade Operator; (4) as in the
previous Granting Period, in order to conduct export activities, the
firm was not required by any level of government law or regulation to
possess additional certificates or other documents related to the legal
status and/or operation of its business beyond those discussed above;
and (5) PRC government laws and legislative enactments applicable to
SFTC remained the same as in the

[[Page 677]]

previous Granting Period. SFTC attached copies of its business license
and foreign trade operator registration form to its separate
certification to document the absence of government de jure control.
As in prior cases, we have analyzed these laws and have found them
to sufficiently establish an absence of de jure control of joint
ventures and companies owned by ``all of the people'' absent proof on
the record to the contrary. See, e.g., Notice of Final Determination of
Sales at Less Than Fair Value: Furfuryl Alcohol From the People's
Republic of China, 60 FR 22544 (May 8, 1995) (``Furfuryl Alcohol''). We
have no information in this proceeding that would cause us to
reconsider this determination. Thus, we find that the evidence on the
record supports a preliminary finding of absence of de jure government
control for SFTC, China First-Three Star (``the China First-Three Star
collapsed entity''), and Rongxin based on: (1) an absence of
restrictive stipulations associated with the exporter's business
license; (2) the legal authority on the record decentralizing control
over the respondent, as demonstrated by the PRC laws placed on the
record of this review; and (3) other formal measures by the government
decentralizing control of companies.

Absence of De Facto Control

As stated in previous cases, there is some evidence that certain
enactments of the PRC central government have not been implemented
uniformly among different sectors and/or jurisdictions in the PRC. See
Silicon Carbide, 59 FR at 22587. Therefore, the Department has
determined that an analysis of de facto control is critical in
determining whether respondents are, in fact, subject to a degree of
government control which would preclude the Department from assigning
separate rates.
The Department typically considers the following four factors in
evaluating whether a respondent is subject to de facto government
control of its export functions: (1) whether the export prices are set
by, or subject to the approval of, a government agency; (2) whether the
respondent has the authority to negotiate and sign contracts and other
agreements; (3) whether the respondent has autonomy from the government
in making decisions regarding the selection of management; and (4)
whether the respondent retains the proceeds of its export sales and
makes independent decisions regarding the disposition of profits or
financing of losses. See Silicon Carbide, 59 FR at 22586-87, and
Furfuryl Alcohol, 60 FR at 22545.
The affiliates in the China First-Three Star collapsed entity
(where applicable) and Rongxin all have asserted the following: (1)
each establishes its own export prices; (2) each negotiates contracts
without guidance from any government entities or organizations; (3)
each makes its own personnel decisions; and (4) each retains the
proceeds of its export sales, uses profits according to its business
needs, and has the authority to sell its assets and to obtain loans.
Additionally, each respondent's questionnaire responses indicate that
its pricing during the POR was not coordinated among exporters. As a
result, there is a sufficient basis to preliminarily determine that
each respondent listed above (including the China First-Three Star
collapsed entity as a whole) has demonstrated a de facto absence of
government control of its export functions and is each entitled to a
separate rate. Consequently, we have preliminarily determined that each
of these respondents has met the criteria for the application of a
separate rate. Moreover, with respect to the affiliates included in the
China First-Three Star collapsed entity, we have assigned to all of
them the same antidumping rate in these preliminary results for the
above-mentioned reasons.
The Department also conducted a separate rates analysis for SFTC.
SFTC certified the following: (1) there is no government participation
in setting export prices; (2) the firm has independent authority to
negotiate and sign export contracts; (3) the firm had autonomy from all
levels of government in making decisions regarding the selection of
management; (4) SFTC did not submit the names of its candidates for
managerial positions to any governmental entity for approval; and (5)
there are no restrictions on the use of export revenue. During our
analysis of the information on the record, we found no information
indicating the existence of government control of SFTC's export
activities. See SFTC's submission of July 24, 2008. Consequently, we
preliminarily determine that SFTC has met the criteria for the
application of a separate rate.

Fair-Value Comparisons

To determine whether the respondents' sales of subject merchandise
were made at less than NV, we compared the NV to individual export
price (``EP'') transactions in accordance with section 777A(d)(2) of
the Act. See ``Export Price'' and ``Normal Value'' sections of this
notice, below.

Export Price

In accordance with section 772(a) of the Act, EP is ``the price at
which merchandise is first sold (or agreed to be sold) before the date
importation by the producer or exporter of the subject merchandise
outside of the United States to an unaffiliated purchaser in the United
States to an unaffiliated purchaser for exportation to the United
States,'' as adjusted under section 772(c) of the Act. In accordance
with section 772(a) of the Act, we used EPs for sales by the China
First-Three Star collapsed entity and Rongxin to the United States
because the subject merchandise was sold directly to unaffiliated
customers in the United States (or to unaffiliated resellers outside
the United States with knowledge that the merchandise was destined for
the United States) prior to importation, and constructed export price
methodology was not otherwise indicated. We based EP on free-on-board
port or delivered prices to unaffiliated purchasers in the United
States. In accordance with section 772 (c)(2)(A) of the Act, we made
deductions for movement expenses, where appropriate. Movement expenses
included expenses for foreign inland freight from plant to port of
exportation, foreign brokerage and handling where applicable,
international freight. Foreign inland freight and foreign brokerage and
handling were provided by an NME vendor and, thus, as explained in the
section below, we based the amounts of the deductions for these
movement charges on values from a surrogate country.
For international freight, we used the reported expenses because
the respondents used market-economy freight carriers and/or paid for
those expenses in a market-economy currency. For certain sales, Rongxin
used a market-economy carrier, which it paid in U.S. dollars. In China
First-Three Star's case, it used an NME carrier, but paid for the
services in a market-economy currency. All of the respondents reported
that they incurred no marine insurance expenses on their sales to the
United States. For a detailed description of all adjustments, see
Memorandum from Nancy Decker, Program Manager, Office 1, to the File
entitled ``Analysis for the Preliminary Results of Antidumping Duty
Administrative Review of Certain Cased Pencils from the People's
Republic of China: China First Pencil Company, Ltd., Shanghai Three
Star Stationery Industry Corp.'' (``China First-Three Star Preliminary
Calculation Memorandum''), December 30, 2008, and ``Analysis for the
Preliminary

[[Page 678]]

Results of Antidumping Duty Administrative Review of Certain Cased
Pencils from the People's Republic of China: Shandong Rongxin Import
and Export Co. Ltd.'' (``Rongxin Preliminary Calculation Memorandum''),
December 30, 2008.
We valued brokerage and handling using a simple average of the
brokerage and handling costs that were reported in public submissions
that were filed in three antidumping duty cases. Specifically, we
averaged the public brokerage and handling expenses reported by: Agro
Dutch Industries Ltd. in the antidumping duty administrative review of
certain preserved mushrooms from India; Kejirwal Paper Ltd. in the less
than fair value investigation of certain lined paper products from
India; and Essar Steel in the antidumping duty administrative review of
hot-rolled carbon steel flat products from India. See Certain Preserved
Mushrooms From India: Final Results of Antidumping Duty Administrative
Review, 71 FR 10646 (March 2, 2006); see also Notice of Preliminary
Determination of Sales at Less Than Fair Value, Postponement of Final
Determination, and Affirmative Preliminary Determination of Critical
Circumstances in Part: Certain Lined Paper Products From India, 71 FR
19706 (April 17, 2006) (unchanged in final results, 71 FR 45012 (August
8, 2006)), and Certain Hot-Rolled Carbon Steel Flat Products From
India: Preliminary Results of Antidumping Duty Administrative Review,
71 FR 2018, 2021 (January 12, 2006) (unchanged in final results, 71 FR
40694 (July 18, 2006)). We identify the source used to value foreign
inland freight in the ``Normal Value'' section of this notice, below.
We adjusted these values, as appropriate, to account for inflation or
deflation between the effective period and the POR. We calculated the
inflation or deflation adjustments for these values using the wholesale
price indices (``WPI'') for India as published in the International
Financial Statistics (``IFS'') Online Service maintained by the
Statistics Department of the International Monetary Fund at the website
http://www.imfstatistics.org.

Normal Value

Section 773(c)(1) of the Act provides that the Department shall
determine NV using an factor of production (``FOP'') methodology if the
merchandise is exported from an NME country and the information does
not permit the calculation of NV using home-market prices, third-
country prices, or constructed value under section 773(a) of the Act.
The Department will base NV on FOPs because the presence of
government controls on various aspects of these NME economies renders
price comparisons and the calculation of production costs invalid under
our normal methodologies. Therefore, we calculated NV based on FOPs in
accordance with sections 773(c)(3) and (4) of the Act and 19 CFR
351.408(c). The FOPs include: (1) hours of labor required; (2)
quantities of raw materials employed; (3) amounts of energy and other
utilities consumed; and (4) representative capital costs. We used the
FOPs reported by respondents for materials, energy, labor, and packing.
In accordance with 19 CFR 351.408(c)(1), when a producer sources an
input from a market-economy (``ME'') country and pays for it in ME
currency, the Department will normally value the factor using the
actual price paid to the market-economy supplier for the input. See 19
CFR 351.408(c)(1). Where a portion of the input is purchased from a
market-economy supplier and the remainder from an NME supplier, the
Department will normally use the price paid for the input sourced from
market-economy suppliers to value all of the input, provided the volume
of the market-economy input as a share of total purchases from all
sources is ``meaningful.'' See Antidumping Duties; Countervailing
Duties; Final Rule, 62 FR 27296, 27366 (May 19, 1997); Shakeproof v.
United States, 268 F.3d 1376, 1382 (Fed. Cir. 2001); 19 CFR
351.408(c)(1); see also Antidumping Methodologies: Market Economy
Inputs, Expected Non-Market Economy Wages, Duty Drawback; and Request
for Comments, 71 FR 61716, 61716-61719 (October 19, 2006) regarding the
Department's flexible 33 percent threshold for market economy inputs.
In this administrative review, Three Star, one of the companies in the
collapsed China First-Three Star entity, reports purchasing four market
economy inputs. However, the volume of three of the four market economy
purchases did not exceed the threshold percentage that the Department
normally considers ``meaningful'' when these purchases were compared to
the combined NME purchases of the same inputs by the collapsed Chin
First-Three Star entity. See China First-Three Star Preliminary
Calculation Memorandum.
With regard to both the Indian import-based surrogate values and
the ME input values, we have disregarded prices that we have reason to
believe or suspect may be subsidized. See Tapered Roller Bearings and
Parts Thereof, Finished and Unfinished, From the People's Republic of
China; Final Results of 1999-2000 Administrative Review, Partial
Rescission of Review, and Determination Not To Revoke Order in Part, 66
FR 57420 (November 15, 2001), and accompanying Issues and Decision
Memorandum at Comment 1. We have found that India, Indonesia, South
Korea, and Thailand maintain broadly available, non-industry-specific
export subsidies, and it is reasonable to infer that exports to all
markets from these countries may be subsidized. See Certain Frozen Fish
Fillets From the Socialist Republic of Vietnam: Preliminary Results and
Preliminary Partial Rescission of Antidumping Duty Administrative
Review, 70 FR 54007, 54011 (September 13, 2005) (unchanged in final
results, 71 FR 14170 (March 21, 2006)); and China Nat'l Machinery
Import & Export Corp. v. United States, 293 F. Supp. 2d 1334, 1336 (Ct.
Int'l. Trade 2003), aff'd 104 Fed. App 183 (Fed. Cir. 2004).
In avoiding the use of prices that may be subsidized, the
Department does not conduct a formal investigation to ensure that such
prices are not subsidized. See H.R. Rep. 100-576 at 590-91 (1988),
reprinted in 1988 U.S.C.C.A.N. 1547, 1623. Rather, the Department bases
its decision on information that is available to it at the time it is
making its determination. Therefore, we have not used prices from these
countries either in calculating the Indian import-based surrogate
values or in calculating ME input values. See Factor Valuation
Memorandum.

Factor Valuations

In accordance with section 773(c)(3) of the Act, we calculated NV
based on FOPs reported by the respondents for the POR. We multiplied
the reported per-unit factor quantities by publicly available Indian
surrogate values. In selecting the surrogate values, we considered the
quality, specificity, and contemporaneousness of the data.
In accordance with section 773(c)(1) of the Act, for purposes of
calculating NV, we attempted to value the FOPs using surrogate values
that were in effect during the POR. If we were unable to obtain
surrogate values that were in effect during the POR, we adjusted the
values, as appropriate, to account for inflation or deflation between
the effective period and the POR. We calculated the inflation or
deflation adjustments for all factor values, as applicable, except
labor, using the WPI for the appropriate surrogate country as published
in the IFS.
As appropriate, we adjusted input prices by including freight costs
to make them delivered prices. Specifically, we

[[Page 679]]

added to the Indian import surrogate values a surrogate freight cost
calculated using the shorter of the reported distance from the domestic
supplier to the factory or the distance from the nearest port of export
to the factory where appropriate (i.e., where the sales terms for the
ME inputs were not delivered to the factory). This adjustment is in
accordance with the decision of the Court of Appeals for the Federal
Circuit in Sigma Corp. v. United States, 117 F.3d 1401 (Fed. Cir.
1997). We valued the FOPs as follows:
(1) Except where noted below, we valued all reported material,
energy, and packing inputs using Indian import data from the World
Trade Atlas (``WTA'') for December 2006 through November 2007.
(2) To value lindenwood pencil slats, we used publicly available,
published U.S. prices for American basswood lumber because price
information for Chinese lindenwood and American basswood is not
available from any of the potential surrogate countries.\9\ The U.S.
lumber prices for basswood for the period December 1, 2006, through
November 30, 2007.are published in the Hardwood Market Report. We
intend to obtain additional information on this issue after the
preliminary results. For further discussion see Factor Valuation
Memorandum.
---------------------------------------------------------------------------

\9\ In the antidumping investigation of certain cased pencils
from the PRC, the Department found Chinese lindenwood and American
basswood to be virtually indistinguishable and thus used U.S. prices
for American basswood to value Chinese lindenwood. See Notice of
Final Determination of Sales at Less Than Fair Value: Certain Cased
Pencils From the People's Republic of China, 59 FR 55625, 55632
(November 8, 1994). This methodology was upheld by the Court of
International Trade. See Writing Instrument Mfrs. Ass'n Pencil
Section, et. al. v. United States, 984 F. Supp. 629, 639 (Ct. Int'l.
Trade 1997), aff'd 178 F.3d 1311 (Fed. Cir. 1998).
---------------------------------------------------------------------------

(3) The China First-Three Star collapsed entity reported that some
of its purchases of specific inputs were sourced from ME countries and
paid for in ME currencies. Pursuant to 19 CFR 351.408(c)(1), we used
the actual price paid by the China First-Three Star collapsed entity
for one of these inputs. Where applicable, we also adjusted these
values to account for freight costs incurred between the supplier and
respondent. See Factor Valuation Memorandum, Analysis for the
Preliminary Results of the Antidupming Duty Administrative Review of
Certain Cased Pencils from the People's Republic of China: China First
Pencil Company, Ltd. (``China First'') and Shanghai Three Star
Stationery Industry Corp. (``Three Star''), December 30, 2008, and
Analysis for the Preliminary Results of the Antidupming Duty
Administrative Review of Certain Cased Pencils from the People's
Republic of China: Shandong Rongxin Import & Export Co. (``Rongxin'').,
December 30, 2008. As noted above, we found that the ME purchases of
the other three inputs reported by the China First-Three Star collapsed
entity did not account for a high enough percentage of the collapsed
entity's total purchases of those inputs to be meaningful.
(4) We valued electricity using price data for small, medium, and
large industries, as published by the Central Electricity Authority of
the Government of India in its publication titled ``Electricity Tariff
& Duty and Average Rates of Electricity Supply in India,'' dated July
2006. These electricity rates represent actual country-wide, publicly-
available information on tax-exclusive electricity rates charged to
industries in India. Since the rates are not contemporaneous with the
POI, we inflated the values using the WPI. See Factor Valuation
Memorandum.
(5) We valued steam using the data as calculated by the Department
in the Certain New Pneumatic Off-The-Road Tires from the People's
Republic of China: Final Affirmative Determination of Sales at Less
Than Fair Value and Partial Affirmative Determination of Critical
Circumstances,73 FR 40485 (July 15, 2008) and accompanying Issues and
Decision Memorandum at Comment 11. We adjusted this value, as
appropriate, to account for inflation between the effective period and
the POR.
(6) Section 351.408(c)(3) of the Department's regulations requires
the use of a regression-based wage rate. Therefore, we valued labor
using the regression-based wage rate for China published on IA's
website. The source of the wage rate data on the Import
Administration's website is the International Labour Organization
(``ILO''), Geneva, Labour Statistics Database Chapter 5B: Wages in
Manufacturing. See Expected Wages of Selected NME Countries (revised
November 2008) (available at http://ia.ita.doc.gov/wages/index.html).
Since this regression-based wage rate does not separate the labor rates
into different skill levels or types of labor, we have applied the same
wage rate to all skill levels and types of labor.
(7) We derived ratios for factory overhead, depreciation, and
selling, general and administrative expenses, interest expenses, and
profit for the finished product using the 2006-2007 (``FY 06-07 FS'')
financial statement of Triveni Pencils Ltd. (``Triveni''), an Indian
producer of pencils, in accordance with the Department's practice with
respect to selecting financial statements for use in NME cases (see,
e.g., Notice of Final Determination of Sales at Less Than Fair Value:
Chlorinated Isocyanurates From the People's Republic of China, 70 FR
24502 (May 10, 2005), and accompanying Issues and Decision Memorandum
at Comment 2). The Department prefers to derive financial ratios using
data from those surrogate producers whose financial data will not be
distorted or otherwise unreliable.
In prior reviews of this product, the Department derived the
surrogate financial ratios from the financial statement of Camlin Ltd.
(``Camlin''), an Indian producer of pencils and other products. See,
e.g., Certain Cased Pencils From the People's Republic of China;
Preliminary Results of Antidumping Duty Administrative Review, 71 FR
70949 (December 7, 2006) (``Prelim PRC Pencils 2004-2005 AR'')
(unchanged in the final results, 72 FR 27074 (May 14, 2007)). However,
we have used Triveni's FY 06-07 FS for purposes of the preliminary
results of this review because Triveni pencils, whereas Camlin produces
pencils and an array of other art supplies. Because of this, Triveni is
a better match with our Chinese respondents who also primarily produce
pencil producers. Consequently, we find Triveni's FY 06-07 report to be
more reliable and less distortive than Camlin's financial data. In
addition, India is our primary surrogate country and Triveni is an
Indian producer of the subject merchandise. Therefore, for both the
China First-Three Star collapsed entity and Rongxin, we have applied
the ratios taken from Triveni's FY 06-07 FS statement to the
respondents' calculated costs for materials, labor, and energy.
(8) We valued inland truck freight expenses using a per-unit
average

[[Page 680]]

rate calculated from data on the following website: http://www.infobanc.com/logistics/logtruck.htm. The logistics section of this
website contains inland freight truck rates between many large Indian
cities. For certain Rongxin sales where inland freight was provided by
``ferry,'' we were unable to find sufficiently recent barge rates and,
therefore, we substituted inland truck rates. See Factor Valuation
Memorandum. Since the truck rate value is not contemporaneous with the
POI, we deflated the rate using WPI. For Rongxin we used 2006-2007 data
from the website www.Indianrailways.gov to derive, where appropriate,
input-specific train rates on a rupees per kilogram per kilometer
basis(Rs/kg/km''). Rongxin also reported transportation by
cart for one input which we disregarded because the distance involved
was insignificant. See China First-Three Star Preliminary Calculation
Memorandum. For further discussion of the surrogate values we used for
these preliminary results of review, see the Factor Valuation
Memorandum, which is on file in the Central Records Unit (``CRU'') in
Room 1117 of the main Department of Commerce building.

Currency Conversion

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 Bank.

Preliminary Results of Review

We preliminarily determine that the following margins exist for the
period December 1, 2006, through November 30, 2007:

------------------------------------------------------------------------
Margin
Manufacturer/exporter (percent)
------------------------------------------------------------------------
China First Pencil Company, Ltd. (which includes its 33.26
affiliates China First Pencil Fang Zheng Co., Shanghai
First Writing Instrument Co., Ltd., and Shanghai Great Wall
Pencil Co., Ltd.), and Shanghai Three Star Stationery
Industry Corp.\10\.........................................
Shandong Rongxin Import & Export Co., Ltd................... 8.53
Orient International Holding Shanghai Foreign Trade Co., 20.90
Ltd........................................................
PRC-wide Entity\11\......................................... 114.90
------------------------------------------------------------------------
\10\ For this review, we consider China First Pencil Company, Ltd.,
China First Pencil Fang Zheng Co., Shanghai First Writing Instrument
Co., Ltd., Shanghai Great Wall Pencil Co., Ltd., and Shanghai Three
Star Stationery Industry Corp. to constitute a single entity as stated
on page A-1 of China First's August 1, 2008, Section A Response.
\11\ The PRC-wide entity includes Anhui Import Export Co., Ltd.,
Guangdong Provincial Stationeryand Sporting Goods Import Export
Corporation, and Tianjin Custom Wood Processing Co., Ltd.

As stated above in the ``Separate-Rates Determination'' section of
this notice, SFTC qualifies for a separate rate in this review.
Moreover as stated above in the ``Respondent Selection'' section of
this notice, we limited this review by selecting the largest exporters
and did not select SFTC as a mandatory respondent. Therefore, SFTC is
being assigned a dumping margin based on the calculated margins of
mandatory respondents which are not de minimis or based on adverse
facts available, in accordance with Department practice. Accordingly,
we have assigned SFTC the simple-average of the dumping margins
assigned to the China First-Three Star collapsed entity and Rongxin.
The Department will disclose calculations performed for these
preliminary results to the parties within five days of the date of
publication of this notice in accordance with 19 CFR 351.224(b).
In accordance with 19 CFR 351.301(c)(3)(ii), for the final results
of this administrative review, interested parties may submit publicly
available information to value FOPs within 20 days after the date of
publication of these preliminary results. Interested parties must
provide the Department with supporting documentation for the publicly
available information to value each FOP. Additionally, in accordance
with 19 CFR 351.301(c)(1), for the final results of this administrative
review, interested parties may submit factual information to rebut,
clarify, or correct factual information submitted by an interested
party less than ten days before, on, or after, the applicable deadline
for submission of such factual information. However, the Department
notes that 19 CFR 351.301(c)(1) permits new information only insofar as
it rebuts, clarifies, or corrects information recently placed on the
record. The Department generally cannot accept the submission of
additional, previously absent-from-the-record alternative surrogate
value information pursuant to 19 CFR 351.301(c)(1). See Glycine from
the People's Republic of China: Final Results of Antidumping Duty
Administrative Review and Final Rescission, in Part, 72 FR 58809
(October 17, 2007) and accompanying Issues and Decision Memorandum at
Comment 2.
An interested party may request a hearing within 30 days of
publication of the preliminary results. See 19 CFR 351.310(c).
Interested parties may submit written comments (case briefs) within
seven days of issuance of the verification report and rebuttal comments
(rebuttal briefs), which must be limited to issues raised in the case
briefs, within five days after the time limit for filing case briefs.
See 19 CFR 351.309(c)(1)(ii) and 19 CFR 351.309(d). Parties who submit
arguments are requested to submit with the argument: (1) a statement of
the issue; (2) a brief summary of the argument; and (3) a table of
authorities. Further, the Department requests that parties submitting
written comments provide the Department with a diskette containing the
public version of those comments. We will issue a memorandum
identifying the date of a hearing, if one is requested.
The Department will issue the final results of this administrative
review, including the results of our analysis of the issues raised by
the parties in their comments, within 120 days of publication of the
preliminary results, pursuant to section 751(a)(3)(A) of the Act.

Assessment Rates

Upon completion of this administration review, the Department will
determine, and CBP shall assess, antidumping duties on all appropriate
entries. The Department intends to issue assessment instructions to CBP
15 days after the date of publication of the final results of review.
Pursuant to 19 CFR 351.212(b)(1), we will calculate importer- or
customer-specific ad valorem duty assessment rates based on the ratio
of the total amount of the dumping margins calculated for the examined
sales to the total entered value of those same sales. To determine
whether the duty assessment rates are de minimis (i.e., less than 0.50
percent), in accordance with the requirement set forth in 19 CFR
351.106(c)(2), we will calculate customer-specific ad valorem ratios
based on export prices.
We will instruct CBP to assess antidumping duties on all
appropriate entries covered by this review if any importer- or
customer-specific assessment rate calculated in the final

[[Page 681]]

results of this review is above de minimis.
For entries of the subject merchandise during the POR from
companies not subject to this review, we will instruct CBP to liquidate
them at the cash deposit rate in effect at the time of entry. The final
results of this review shall be the basis for the assessment of
antidumping duties on entries of merchandise covered by the final
results of this review and for future deposits of estimated duties,
where applicable.
For the China First-Three Star collapsed entity and Rongxin, we
have calculated customer-specific antidumping duty assessment amounts
for subject merchandise based on the ratio of the total amount of
antidumping duties calculated for the examined sales to the total
quantity of sales examined. We calculated these assessment amounts
because there is no information on the record which identifies entered
values or the importers of record for the U.S. sales of the China
First-Three Star collapsed entity and Rongxin.
As noted above, SFTC, the company that met the separate rate
application status, will be assigned the simple-average dumping margin
based on the calculated margins of mandatory respondents which are not
de minimis or based on adverse facts available, in accordance with
Department practice. We will instruct CBP to assess antidumping duties
on this company's entries equal to the margin this company receives in
the final results, regardless of the importer or customer.
The other three companies, Anhui, Guangdong and Tianjin, did not
provide separate rate information. Therefore, the Department finds that
they are not entitled to a separate rate. As a result, these three
companies will be considered part of the PRC-wide entity, subject to
the PRC-wide rate.
For Dixon, for which this review is preliminarily rescinded,
antidumping duties shall be assessed at rates equal to the cash-deposit
of estimated. antidumping duties required at the time of entry, or
withdrawal form warehouse, for consumption, in accordance with 19 CFR
351.212(c)(2).

Cash Deposit Requirements

The following cash-deposit requirements will apply to all shipments
of certain cased pencils from the PRC entered, or withdrawn from
warehouse, for consumption on or after the publication date of the
final results of this administrative review, as provided by section
751(a)(1) of the Act: (1) the cash deposit rates for the reviewed
companies named above will be the rates for those firms established in
the final results of this administrative review; (2) for any previously
reviewed or investigated PRC or non-PRC exporter, not covered in this
review, with a separate rate, the cash deposit rate will be the
company-specific rate established in the most recent segment of this
proceeding; (3) for all other PRC exporters, the cash deposit rate will
be the PRC-wide rate established in the final results of this review;
and (4) the cash-deposit rate for any non-PRC exporter of subject
merchandise from the PRC will be the rate applicable to the PRC
exporter that supplied that exporter. These deposit requirements, when
imposed, shall remain in effect until further notice.

Notification to Interested Parties

This notice serves as a preliminary reminder to importers of their
responsibility under 19 CFR 351.402(f)(2) to file a certificate
regarding the reimbursement of antidumping duties prior to liquidation
of the relevant entries during this review period. Failure to comply
with this requirement could result in the Secretary's presumption that
reimbursement of antidumping duties occurred and the subsequent
assessment of double antidumping duties.
We are issuing and publishing the preliminary results determination
in accordance with sections 751(a)(1) and 777(i)(1) of the Act.

Dated: December 30, 2008.
David M. Spooner,
Assistant Secretary for Import Administration.
[FR Doc. E9-00062 Filed 1-6-09; 8:45 am]
BILLING CODE 3510-DS-S