[Federal Register: March 19, 2003 (Volume 68, Number 53)]
[Notices]
[Page 13264-13267]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr19mr03-40]
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DEPARTMENT OF COMMERCE
International Trade Administration
[A-570-504]
Petroleum Wax Candles From the People's Republic of China; Final
Results of Antidumping Duty Administrative Review
AGENCY: Import Administration, International Trade Administration,
Department of Commerce.
SUMMARY: On September 10, 2002, the Department of Commerce (``the
Department'') published in the Federal Register the preliminary results
of its administrative review of the antidumping duty order on petroleum
wax candles from the People's Republic of China (67 FR 57384). This
review covers imports of subject merchandise from Dongguan Fay Candle
Co., Ltd. (Fay Candle), a PRC producer and exporter of subject
merchandise, and its U.S. importers, TIJID, Inc. (TIJID) (d/b/a DIJIT
Inc.), and Palm Beach Home Accents, Inc., (Palm Beach) (collectively,
``respondents''). The review covers the period August 1, 2000 through
July 31, 2001.
Based on our analysis of the comments received, we have made a
change in the selection of an adverse facts available margin. As such,
the final results differ from the preliminary results of review. The
final antidumping duty margin is listed below in the section entitled
``Final Results of the Review.''
EFFECTIVE DATE: March 19, 2003.
FOR FURTHER INFORMATION CONTACT: Mark Hoadley at (202) 482-3148, or
Jessica Burdick at (202) 482-0666, Import Administration, International
Trade Administration, U.S. Department of Commerce, 14th Street and
Constitution Avenue NW., Washington, DC 20230.
SUPPLEMENTARY INFORMATION:
Background
Since the issuance of the preliminary results of review (see Notice
of Preliminary Results of Antidumping Administrative Review: Petroleum
Wax Candles From the People's Republic of China, 67 FR 57384 (September
10, 2002) (Preliminary Results)), the following events have occurred.
On October 4, 2002, respondents requested an extension of the due date
for the case and rebuttal briefs and any hearing requests. On October
17, 2002, the Department extended the case brief and hearing request
due date to November 25, 2002, and the rebuttal brief due date to
December 9, 2002. On November 20, 2002, the Department extended the due
date for the final results of this review (67 FR 70055). On November
21, 2002, respondents requested a hearing. On November 25, 2002, the
Department received timely written case briefs from respondents and
petitioner. On December 4, 2002, we received a request from petitioner
to extend the December 9, 2002 rebuttal brief deadline to December 16,
2002. On December 5, 2002, respondents in this review requested the
same extension. On December 6, 2002, we notified all of the interested
parties in this review that, pursuant to both petitioner's and
respondents' extension requests, we would be extending the deadline for
all interested parties for submission of rebuttal briefs until December
16, 2002. On December 16, 2002, we received a request from petitioner
to extend this rebuttal brief deadline to December 18, 2002, which we
granted for all interested parties. On December 18, 2002, the
Department received timely rebuttal comments from respondents and
petitioner. On February 3, 2003, a public hearing was held in this
proceeding. We have now completed this administrative review in
accordance with section 751 of the Act.
Scope of the Antidumping Duty Order
The products covered by this order are certain scented or unscented
petroleum wax candles made from petroleum wax and having fiber or
paper-cored wicks. They are sold in the following shapes: tapers,
spirals, and straight-sided dinner candles; rounds, columns, pillars,
votives; and various wax-filled containers. The products were
classified under the Tariff Schedules of the United States (TSUS) item
755.25, Candles and Tapers. The products are currently classified under
the Harmonized Tariff Schedule of the United States (HTSUS) item
3406.00.00. Although the HTSUS subheading is provided for convenience
and customs purposes, our written description of the scope of this
proceeding remains dispositive.
Period of Review
The period of review (POR) is August 1, 2000 through July 31, 2001.
Analysis of Comments Received
All issues raised in the case and rebuttal briefs by parties to
this administrative review are addressed in the ``Issues and Decision
Memorandum for Final Results of Antidumping Duty Administrative Review
of Petroleum Wax Candles from the People's Republic of China,'' to
Joseph A. Spetrini, Acting Assistant Secretary for Import
Administration, from Barbara E. Tillman, Acting Deputy Assistant
Secretary for Import Administration, dated March 10, 2003 (Decision
Memorandum), which is hereby adopted by this notice. A list of the
issues which parties have raised and to which we have responded, all of
which are addressed in the Decision Memorandum, is attached to this
notice as an appendix. Parties can find a complete discussion of all
issues raised in this review and the corresponding recommendations in
this public memorandum which is on file in the Central Records Unit,
Room B-099 of the main Department building. In addition, a complete
version of the Decision Memorandum can be accessed directly on the Web
at http://ia.ita.doc.gov. The paper copy and electronic version of the
Decision Memorandum are identical in content.
Changes Since the Preliminary Results
Based on our analysis of the comments received, we have made a
change in the selection of adverse facts available margin. See the
section on ``Application of Facts Available'' below for a full
discussion. In the preliminary results, we determined that Fay Candle
was eligible for a separate rate. See Preliminary Results, 67 FR at
57386. We have not changed that determination in these final results.
Application of Facts Available
The Department conducted verification at Fay Candle's factory in
China from July 22 through 26, 2002. On July 22, 2002, respondents
presented
[[Page 13265]]
corrections to their questionnaire responses. The corrections included
a previously unreported production order, which amounted to a
significant increase in the production for the POR. The verification
team proceeded with verification of the questionnaire responses, but
indicated that it would have to confer with Washington concerning
whether the new information could be accepted. On July 26, 2002, after
consulting with Washington, the team returned all documents relating to
the new production data and halted the remainder of the verification in
China. See ``Memorandum Regarding Administrative Review of Petroleum
Wax Candles from the Peoples Republic of China (PRC) (A-570-504): PRC
Verification,'' Memorandum to the File, through Sally C. Gannon, from
Mark Hoadley, Brett Royce, and Jessica Burdick (August 30, 2002) (PRC
Verification Report), which is on file in the Central Records Unit
(CRU), room B-099 of the main Department building; ``Memorandum
Regarding 2000/2001 Administrative Review on Candles from the People
{sic{time} Republic of China (A-570-504): Telephone Call Regarding
Verification,'' for The File from Sally C. Gannon (August 2, 2002).
The next week, the Department informed respondents that it would
proceed with the U.S. portion of the verification, and the Department
and respondents agreed on August 12 through 15, 2002 as the dates for
this verification. See ``Memorandum Regarding 2000/2001 Administrative
Review on Candles from the People {sic{time} Republic of China (A-570-
504): Telephone Call Regarding Verification & Rejection of New Factual
Information,'' for The File, through Sally C. Gannon, from Jessica
Burdick (July 31, 2002). On August 9, 2002, respondents called and
informed the Department that they had made a decision not to proceed
with the U.S. portion of the verification. See ``Memorandum Regarding
2000/2001 Administrative Review on Candles from the People {sic{time}
Republic of China (A-570-504): Telephone Call Regarding Verification,''
for The File, from Sally C. Gannon (August 9, 2002). On August 9, 2002,
respondents also filed a letter informing the Department of their
decision not to participate in the U.S. verification.
For these final results of review, we continue to find that, in
accordance with section 776(a)(2)(D) of the Act, the use of facts
available for respondents is appropriate. Respondents' decision not to
allow the Department to conduct an on-site U.S. verification prevented
necessary information from being verified as provided in section
782(i), a condition specifically listed in section 776(a)(2)(D) as
mandating the use of facts available. Once the Department determines
that the use of facts available is warranted, section 776(b) of the Act
further permits the Department to apply an adverse inference if it
makes the additional finding that ``an interested party has failed to
cooperate by not acting to the best of its ability to comply with a
request for information.'' As stated above, the Department set a date
for the U.S. portion of the verification that respondents agreed was
acceptable. Respondents decided not to proceed with verification.
Respondents did not ask that the verification be rescheduled, but
simply stated that they would not proceed with the verification. Since
respondents cancelled the U.S. sales verification, the Department
cannot rely on respondents' questionnaire responses to calculate a
dumping margin for Fay Candle. The U.S. sales verification is integral
to our calculation because, without performing the U.S. sales
verification, we were unable to complete the sales reconciliation as
well as verification of total quantity and value, which are principal
elements of the overall verification of respondents' questionnaire
responses.
Furthermore, while the Department was able to verify parts of the
questionnaire responses in China, that information is inextricably
linked with the information unverified in the United States. See PRC
Verification Report. For example, the Department was able to verify
several factors used in the production of candles. However, that
information is not usable if the Department is unable to verify which
products were actually sold in the United States. The Department would
have been able to ascertain this if the U.S. verification had been
allowed. Moreover, personnel at Fay Candle stated that some items in
the factors of production portion of the response would have to be
verified, at least in part, in the United States. For example, they
stated that additional documents we requested to confirm the amounts of
dyes, fragrances, packaging and hang tags used in production were kept
in Florida. In addition, as noted above, by not performing the U.S.
sales verification, we were unable to complete the sales reconciliation
as well as verification of total quantity and value, which are
principal elements of the overall verification of respondents'
questionnaire responses. Thus, the use of facts available is mandated
for the total response of Fay Candle and its importers. In other words,
it is not possible to rely on respondents' questionnaire responses to
calculate a margin for Fay Candle's exports, even using partial facts
available ``plugs'' for U.S. sales data, which is the data for which
respondents decided not to allow verification.
Therefore, we determine that respondents did not cooperate to the
best of their ability for these final results of review and that the
use of adverse facts available is appropriate under section 776(b). In
the Preliminary Results, as adverse facts available, we applied the
calculated margin of 95.22 percent as published in Petroleum Wax
Candles from the People's Republic of China: Notice of Final Results of
New Shipper Review, 67 FR 41395 (June 18, 2002) (Candles NSR). See
``Memorandum Regarding Petroleum Wax Candles from the People's Republic
of China (PRC): Application of Facts Available for Exports from
Dongguan Fay Candle Co., Ltd.--Preliminary Results of the
Administrative Review (August 1, 2001 through July 31, 2001) to Joseph
A. Spetrini, Deputy Assistant Secretary for Import Administration,
through Barbara E. Tillman and Sally C. Gannon, from Mark Hoadley and
Brett Royce (September 3, 2002) for a complete discussion of the
Department's decision in the Preliminary Results to apply adverse facts
available and the choice of the rate from the new shipper review.
Since the Preliminary Results, the Department has carefully
considered the arguments raised by interested parties regarding the
application of adverse facts available and the choice of dumping
margin. As detailed above, the Department continues to determine that
the use of adverse facts available is appropriate under sections 776(a)
and 776(b) of the Act. However, the Department has reconsidered the use
of the Candles NSR margin in light of the arguments submitted by
interested parties in this review. The 95.22 percent margin was
calculated for a new shipper, a trading company, whose single sale,
albeit of more than one product, during the new shipper POR was also
its first sale ever to the United States. Because of the substantial
difference between the two margins calculated in the new shipper review
(and weight-averaged into the 95.22 percent margin) and the unusual
facts surrounding the new shipper's one sale, the Department has
determined that the application of the new shipper's weighted-average
margin would be inappropriate. The wide range of the two margins weight
averaged together in the new shipper review, given the nature of the
new shipper as a start-up
[[Page 13266]]
with very low sales volumes, and given other unusual proprietary facts
surrounding the sale, has led us to find that it is inappropriate to
use the higher of these two margins. Moreover, while the rate we have
chosen (65.02 percent) is higher than the single PRC-wide rate that has
been applied for the past 16 years (54.21 percent) under this order, it
is still more in line with the 54.21 percent PRC-wide rate which was
also based on facts available. The higher rate we have excluded is more
than double that previous rate, confirming our conclusion that it is
the product of circumstances not germane to this analysis. Our analysis
of why the high margin and the weighted-average margin are
inappropriate relies, in part, on business-proprietary information.
Therefore, see ``Memorandum Regarding Administrative Review of
Petroleum Wax Candles from the People's Republic of China (PRC) (A-570-
504): Proprietary Information Regarding Adverse Facts Available Rate,''
to Barbara E. Tillman, through Sally C. Gannon, from Mark Hoadley
(March 10, 2003) (AFA Memo) for a full discussion of the issue.\1\
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\1\ All relevant calculation documentation from the new shipper
review has been placed on the record of this review. See
``Memorandum Regarding Final Results of Antidumping Duty
Administrative Review of Petroleum Wax Candles from the People's
Republic of China (PRC),'' to The File, through Sally C. Gannon,
from Brett Royce (March 10, 2003).
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We emphasize that we are not establishing a per se rule against
using rates established in new shipper reviews as adverse facts
available (as should be apparent from the fact that we are still using
a rate from the new shipper review). We are excluding the high rate
from this new shipper review because of the substantial difference
between that rate and the other individual rate determined and because
the circumstances of this particular new shipper review lead us to
conclude that that difference is the result of circumstances not
germane to this analysis. See AFA Memo and Decision Memorandum (Comment
4).
In addition to examining the adverse facts available margin applied
to determine whether it is appropriate, we have also in the past
determined to choose margins that are sufficiently adverse to encourage
full cooperation in future reviews. See Japan Hot-Rolled LTFV, 64 FR at
24369, and Final Determination of Sales at Less Than Fair Value:
Stainless Steel Wire Rod From Italy), 63 FR 40422, 40428 (July 29,
1998). We find the rate we have chosen, 65.02 percent, is sufficiently
adverse to encourage compliance in the future. The new shipper review
is the only segment of this proceeding which has resulted in a
calculated rate based on information submitted by a respondent. Because
the AFA rate we have chosen is a calculated rate from the new shipper
review, we conclude that it is an appropriate reflection of the amount
by which PRC exporters are dumping in the United States. Therefore,
future respondents should not view the AFA rate as preferable to their
actual dumping rates, i.e., as an underestimate of their own magnitude
of dumping, and should in general find it an inducement to cooperate
with the Department in calculating their own rates.
Corroboration
Section 776(c) of the Act provides that when the Department relies
on the facts otherwise available and relies on ``secondary
information,'' the Department shall, to the extent practicable,
corroborate that information from independent sources reasonably at the
Department's disposal. The Statement of Administrative Action (SAA),
H.R. Doc. 103-316 (1994), states that ``corroborate'' means to
determine that the information used has probative value. See SAA at
870. To corroborate secondary information, the Department will, to the
extent practicable, examine the reliability and relevance of the
information to be used. However, unlike other types of information,
such as input costs or selling expenses, there are no independent
sources for calculated dumping margins. The only source for calculated
margins is administrative determinations. Thus, in an administrative
review, if the Department chooses as total adverse facts available a
calculated dumping margin from the current or a prior segment of the
proceeding, it is not necessary to question the reliability of the
margin for that time period. See, e.g., Grain-Oriented Electrical Steel
From Italy; Preliminary Results of Antidumping Duty Administrative
Review, 61 FR 36551, 36552 (July 11, 1996).
Accordingly, we determine that the 65.02 percent rate is in accord
with section 776(c)'s requirement that secondary information is
reliable. The information used in the new shipper review to calculate
the final margin of 95.22 percent, for which the 65.02 percent margin
is an integral part of the underlying calculation, was fully verified
and subject to the comments of both respondent and petitioner
throughout the review. Thus, the 65.02 percent margin is ultimately
based on the verified sales and production data of respondent in that
review, as well as on the most appropriate surrogate value information
available to the Department, chosen from submissions by the parties in
that review as well as information gathered by the Department itself.
With respect to the relevance aspect of corroboration, however, the
Department will consider information reasonably at its disposal to
determine whether a margin continues to have relevance. In this case,
as discussed above, the Department has chosen one of the margins
weight-averaged in the new shipper review, the rate of 65.02 percent.
We chose this margin after concluding that using the highest rate or
the weighted-average margin from the new shipper review was
inappropriate, due to the wide range of margins weight averaged
therein. See AFA Memo.
Final Results of Review
We determine that the following percentage margin exists for the
period August 1, 2000 through July 31, 2001:
------------------------------------------------------------------------
Percent
Manufacturer/exporter margin
------------------------------------------------------------------------
Dongguan Fay Candle Co. Ltd.................................. 65.02
PRC-Wide Rate................................................ 54.21
------------------------------------------------------------------------
The Department will disclose calculations performed in connection
with these final results of review within five days of the date of
publication of this notice in accordance with 19 CFR 351.224(b).
Assessment
The Department will determine, and the U.S. Customs Service
(Customs) shall assess, antidumping duties on all appropriate entries.
For Fay Candle, the assessment rate will be based on the margin noted
above. The Department will issue appropriate assessment instructions
directly to Customs within 15 days of publication of these final
results of review. We will direct Customs to assess the resulting
assessment rates against the entered Customs values for the subject
merchandise on each of the exporter's entries during the review period.
Cash Deposit Requirements
The following deposit requirements will be effective upon
publication of these final results for this administrative review for
all shipments of petroleum wax candles from the PRC entered, or
withdrawn from warehouse, for consumption on or after the date of
publication, as provided by section 751(a)(2)(C) of the Act: (1) The
cash deposit rate for Fay Candle will be 65.02 percent; (2) for
previously-reviewed PRC and non-PRC exporters with separate rates, the
cash deposit rate will be the company-specific rate established
[[Page 13267]]
for the most recent period; (3) for all other PRC exporters, the cash
deposit rate will be the PRC-wide rate, which is currently 54.21
percent; and, (4) for all other non-PRC exporters, the cash deposit
rate will be the rate applicable to the PRC supplier of that exporter.
These deposit requirements shall remain in effect until publication of
the final results of the next administrative review.
Notification of Interested Parties
This notice also serves as a final 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 the antidumping duties occurred and the subsequent
assessment of double antidumping duties.
This notice also serves as a reminder to parties subject to
administrative protective orders (APOs) of their responsibility
concerning the return or destruction of proprietary information
disclosed under APO in accordance with 19 CFR 351.305, which continues
to govern business proprietary information in this segment of the
proceeding. Timely written notification of the return/destruction of
APO materials or conversion to judicial protective order is hereby
requested. Failure to comply with the regulations and terms of an APO
is a violation which is subject to sanction.
We are issuing and publishing this determination and notice in
accordance with sections 751(a)(1) and 771(I) of the Act.
Dated: March 10, 2003.
Joseph A. Spetrini,
Acting Assistant Secretary for Import Administration.
[FR Doc. 03-6481 Filed 3-18-03; 8:45 am]