[Federal Register Volume 85, Number 239 (Friday, December 11, 2020)]
[Notices]
[Pages 79994-79996]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-27308]
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DEPARTMENT OF COMMERCE
International Trade Administration
[A-580-905]
4th Tier Cigarettes From the Republic of Korea: Final Affirmative
Determination of Sales at Less Than Fair Value, and Final Negative
Determination of Critical Circumstances
AGENCY: Enforcement and Compliance, International Trade Administration,
Department of Commerce.
SUMMARY: The Department of Commerce (Commerce) determines that 4th tier
cigarettes from the Republic of Korea (Korea) are being, or are likely
to be, sold in the United States at less than fair value (LTFV) during
the period of investigation (POI), October 1, 2018 through September
30, 2019. The final weighted-average dumping margins are listed below
in the section entitled ``Final Determination.''
DATES: Applicable December 11, 2020.
FOR FURTHER INFORMATION CONTACT: Thomas Martin, AD/CVD Operations,
Office IV, Enforcement and Compliance, International Trade
Administration, U.S. Department of Commerce, 1401
[[Page 79995]]
Constitution Avenue NW, Washington, DC 20230; telephone: (202) 482-
3936.
SUPPLEMENTARY INFORMATION:
Background
On July 22, 2020, Commerce published the Preliminary Determination
in this investigation, and invited interested parties to comment on our
findings.\1\ The petitioner in this investigation is the Coalition
Against Korean Cigarettes.\2\ The mandatory respondent subject to this
investigation is KT&G Corporation (KT&G). A summary of the events that
occurred since Commerce published the Preliminary Determination, as
well as a full discussion of the issues raised by parties for this
final determination, may be found in the Issues and Decision
Memorandum.\3\
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\1\ See 4th Tier Cigarettes from the Republic of Korea:
Preliminary Affirmative Determination of Sales at Less Than Fair
Value, and Preliminary Negative Determination of Critical
Circumstances, 85 FR 44281 (July 22, 2020) (Preliminary
Determination), and accompanying Preliminary Decision Memorandum.
\2\ The members of the Coalition Against Korean Cigarettes are
Xcaliber International and Cheyenne International.
\3\ See Memorandum, ``Issues and Decision Memorandum for the
Final Affirmative Determination in the Less-Than-Fair-Value
Investigation of 4th Tier Cigarettes from the Republic of Korea,''
dated concurrently with, and hereby adopted by, this notice (Issues
and Decision Memorandum).
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The Issues and Decision Memorandum is a public document and is
available electronically via Enforcement and Compliance's Antidumping
and Countervailing Duty Centralized Electronic Service System (ACCESS).
ACCESS is available to registered users at https://access.trade.gov. In
addition, a complete version of the Issues and Decision Memorandum can
be accessed directly at http://enforcement.trade.gov/frn/index.html.
The signed and electronic versions of the Issues and Decision
Memorandum are identical in content.
Period of Investigation
The POI is October 1, 2018 through September 30, 2019.
Scope of the Investigation
The products covered by this investigation are 4th tier cigarettes
from Korea. For a complete description of the scope of this
investigation, see Appendix I.
Analysis of Comments Received
All issues raised in the case briefs and rebuttal briefs submitted
by interested parties in this proceeding are discussed in the Issues
and Decision Memorandum. A list of the issues raised by parties and
responded to by Commerce in the Issues and Decision Memorandum is
attached to this notice as Appendix II.
Verification
Commerce normally verifies information relied upon in making its
final determination, pursuant to section 782(i)(1) of the Tariff Act of
1930 amended (the Act). However, during the course of this
investigation, we were unable to conduct verification.\4\ Pursuant to
section 776(a)(2)(D) of the Act, in situations where information has
been provided but the information cannot be verified, Commerce will use
``facts otherwise available'' in reaching the applicable determination.
Accordingly, we relied on facts available in making our final
determination.
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\4\ See Memorandum, ``Cancellation of Verification,'' dated
October 21, 2020.
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Changes Since the Preliminary Determination
Based on our analysis of the comments received, we made no changes
to the scope of the merchandise under investigation but made one change
to the margin calculation for KT&G since the Preliminary Determination.
For a discussion of this change, see the Issues and Decision
Memorandum.
All-Others Rate
Section 735(c)(5)(A) of the Act provides that the estimated
weighted-average dumping margin for all other producers and exporters
not individually investigated shall be equal to the weighted average of
the estimated weighted-average dumping margins established for
individually investigated exporters and producers, excluding any
margins that are zero, de minimis, or any margins determined entirely
under section 776 of the Act.
Commerce calculated a weighted-average dumping margin for KT&G, the
only individually examined exporter/producer in this investigation,
that is above de minimis. We have assigned KT&G's margin to all other
producers and exporters, pursuant to section 735(c)(5)(A) of the Act.
Final Determination
The final weighted-average dumping margins are as follows:
------------------------------------------------------------------------
Weighted-
average
Exporter/producer dumping
margin
(percent)
------------------------------------------------------------------------
KT&G Corporation............................................ 5.48
All Others.................................................. 5.48
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Disclosure
We intend to disclose to interested parties the calculations and
analysis performed in this final determination within five days of any
public announcement or, if there is no public announcement, within five
days of the date of the publication of this notice to parties in this
proceeding in accordance with 19 CFR 351.224(b).
Continuation of Suspension of Liquidation
In accordance with section 735(c)(1)(B) of the Act, we will
instruct U.S. Customs and Border Protection (CBP) to continue the
suspension of liquidation of all appropriate entries of 4th tier
cigarettes, as described in Appendix I of this notice, which were
entered, or withdrawn from warehouse, for consumption on or after July
22, 2020, the date of publication of the Preliminary Determination of
this investigation in the Federal Register.
Further, Commerce will instruct CBP to require a cash deposit equal
to the amount by which the normal value exceeds the U.S. price as
follows: (1) For KT&G, the cash deposit rate will be equal to the
weighted-average dumping margin determined in this final determination;
(2) if KT&G is the producer, but not the exporter, then the cash
deposit rate will be equal 5.48 percent; and (3) the cash deposit rate
for all other producers and exporters will be 5.48 percent. These
suspension of liquidation instructions will remain in effect until
further notice.
International Trade Commission Notification
In accordance with section 735(d) of the Act, we will notify the
International Trade Commission (ITC) of the final affirmative
determination of sales at LTFV. Because the final determination in this
proceeding is affirmative, in accordance with section 735(b)(2) of the
Act, the ITC will make its final determination as to whether the
domestic industry in the United States is materially injured, or
threatened with material injury, by reason of imports, or sales (or the
likelihood of sales) for importation of 4th tier cigarettes no later
than 45 days after our final determination. If the ITC determines that
material injury or threat of material injury does not exist, the
proceeding
[[Page 79996]]
will be terminated, and all cash deposits will be refunded. If the ITC
determines that material injury or threat of material injury does
exist, Commerce will issue an antidumping duty order directing CBP to
assess, upon further instruction by Commerce, antidumping duties on all
imports of the subject merchandise, entered, or withdrawn from
warehouse, for consumption on or after the effective date of the
suspension of liquidation.
Notification Regarding Administrative Protective Order
This notice serves as the only reminder to parties subject to an
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). Timely notification of the
return or destruction of APO materials or conversion to judicial
protective order is hereby requested. Failure to comply with the
regulations and the terms of an APO is a violation subject to sanction.
Notification to Interested Parties
We are issuing and publishing this determination and notice in
accordance with sections 735(d) and 777(i) of the Act and 19 CFR
351.210(c).
Dated: December 4, 2020.
Jeffrey I. Kessler,
Assistant Secretary for Enforcement and Compliance.
Appendix I
Scope of the Investigation
The merchandise covered by this investigation is certain tobacco
cigarettes, commonly referred to as ``4th tier cigarettes.'' The
subject cigarettes are composed of a tobacco blend rolled in paper,
have a nominal minimum total length of 7.0 cm but do not exceed 12.0
cm in total nominal length, and have a nominal diameter of less than
1.3 cm. These sizes of cigarettes are frequently referred to as
``Kings'' and ``100's,'' but subject merchandise that meets the
physical description of the scope is included regardless of the
marketing description of the size of the cigarettes. Subject
merchandise typically has a tobacco blend that consists of 10% or
more tobacco stems.
Subject merchandise is typically sold in packs of 20 cigarettes
per pack which generally includes the marking ``20 Class A
Cigarettes'' but are included regardless of packaging. 4th tier
cigarette packages are typically sold in boxes without a rounded
internal corner and without embossed aluminum foil inside the pack.
Both menthol and non-menthol cigarettes and cigarettes with or
without a filter attached are covered by the scope of this
investigation.
Merchandise covered by this investigation is currently
classified in the Harmonized Tariff Schedule of the United States
(HTSUS) under subheading 2402.20.8000. This HTSUS subheading is
provided for convenience and customs purposes; the written
description of the scope of the investigation is dispositive.
Appendix II
List of Topics Discussed in the Issues and Decision Memorandum
I. Summary
II. Background
III. Scope of the Investigation
IV. Changes Since the Preliminary Determination
V. Discussion of the Issues
General Issues
Comment 1: Whether 4th Tier Cigarettes are a Distinct Domestic
Like Product
Comment 2: Whether the Petition Established Industry Support to
Initiate the Investigation
Comment 3: Whether Commerce Clarified the Scope of the
Investigation for Proper Product Comparisons
Comment 4: Whether Commerce Correctly Determined Negative
Critical Circumstances
KT&G Calculation Issues
Comment 5: Whether Commerce Should Deduct Korean Taxes in the
Normal Value (NV) Calculation
Comment 6: Whether Commerce should include KT&G's sales to Non-
Korean Military Forces in Home Market sales
Comment 7: Whether Commerce's level of trade (LOT) adjustment in
place of a constructed export price (CEP) Offset was in accordance
with law
Comment 8: Whether KT&G unlawfully deducted U.S. Taxes from
KT&G's U.S. Price
Comment 9: Whether Commerce Erred in the Rate It Selected to
Compute KT&G USA's Imputed Credit Expenses and Inventory Carrying
Costs
Comment 10: Whether Commerce Erred in its Treatment of REBATE4U,
REBATE5U, and REBATE6U
Comment 11: Whether Commerce Improperly Assumed Certain Returns
Were Billing Adjustments in the U.S. Market
Comment 12: Whether Commerce Improperly Classified KT&G's
Repacking Costs as a Selling Expense
VI. Recommendation
[FR Doc. 2020-27308 Filed 12-10-20; 8:45 am]
BILLING CODE 3510-DS-P