[Federal Register: July 8, 2008 (Volume 73, Number 131)]
[Notices]
[Page 38981-38984]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr08jy08-42]
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DEPARTMENT OF COMMERCE
International Trade Administration
C-570-926
Sodium Nitrite From the People's Republic of China: Final
Affirmative Countervailing Duty Determination
AGENCY: Import Administration, International Trade Administration,
Department of Commerce.
SUMMARY: The Department of Commerce (the Department) has reached a
final determination that countervailable subsidies are being provided
to producers/exporters of sodium nitrite from the People's Republic of
China (PRC). On April 11, 2008, we issued the Preliminary
Determination, see Sodium Nitrite From the People's Republic of China:
Preliminary Affirmative Countervailing Duty Determination, 73 FR 19816
(April 11, 2008) (Preliminary Determination). Because neither the
Government of the People's Republic of China (GOC) nor the two
mandatory company respondents participated in this investigation, the
Department relied on facts available and applied adverse inferences in
reaching the Preliminary Determination. The Department assigned a
countervailable subsidy rate to each program under investigation using
rates calculated in Coated Free Sheet Paper from the People's Republic
of China: Final Affirmative Countervailing Duty Determination, 72 FR
60645 (October 25, 2007) and accompanying Issues and Decision
Memorandum (CFS from the PRC). We invited interested parties to comment
on the Preliminary Determination. No interested party submitted
comments regarding the Preliminary Determination.
Since the publication of the Preliminary Determination, the
Department has reached affirmative final countervailing duty
determinations in several investigations of products from the PRC. We
have used the rates calculated in these intervening final
determinations to revise the countervailable subsidy rates for certain
programs. For information on the countervailable subsidy rates, see the
``Final Determination'' section of this notice.
EFFECTIVE DATE: July 8, 2008.
FOR FURTHER INFORMATION CONTACT: Gene Calvert or Paul Matino, AD/CVD
Operations, Office 6, Import Administration, International Trade
Administration, U.S. Department of Commerce, Room 7866, 14th Street and
Constitution Avenue, NW, Washington, DC 20230; telephone: (202) 482-
3586 or (202) 482-4146, respectively.
SUPPLEMENTARY INFORMATION:
Case History
The following events have occurred since the publication of the
Preliminary Determination in the Federal Register on April 11, 2008. On
April 14, 2008, petitioner (General Chemical LLC) submitted a letter,
in accordance with section 705(a)(1) of the Tariff Act of 1930, as
amended (the Act), requesting alignment of the final countervailing
duty determination with the final determination in the companion
antidumping duty investigation of sodium nitrite from the PRC. On April
28, 2008, the Department aligned the final countervailing duty
determination with the final determination in the companion antidumping
duty investigation of sodium nitrite from the PRC. See Sodium Nitrite
from the People's Republic of China: Alignment of Final Countervailing
Duty Determination with Final Antidumping Duty Determination, 73 FR
22920 (April 28, 2008).
Period of Investigation
The period of investigation (POI) for which we are measuring
subsidies is calendar year 2006. See 19 CFR 351.204(b)(2).
Scope of the Investigation
The merchandise covered by this investigation is sodium nitrite in
any form, at any purity level. In addition, the sodium nitrite covered
by this investigation may or may not contain an anti-caking agent.
Examples of names commonly used to reference sodium nitrite are nitrous
acid, sodium salt, anti-rust, diazotizing salts, erinitrit, and
filmerine. The chemical composition of sodium nitrite is NaNO2 and it
is generally classified under subheading 2834.10.1000 of the Harmonized
Tariff Schedule of the United States (HTSUS). The American Chemical
Society Chemical Abstract Service (CAS) has assigned the name ``sodium
nitrite'' to sodium nitrite. The CAS registry number is 7632-00-0. For
purposes of the scope of this investigation, the narrative description
is dispositive, not the tariff heading, CAS registry number or CAS
name, which are provided for convenience and customs purposes.
[[Page 38982]]
Injury Test
Because the PRC is a ``Subsidies Agreement Country'' within the
meaning of section 701(b) of the Act, the International Trade
Commission (ITC) is required to determine pursuant to section 701(a)(2)
of the Act whether imports of the subject merchandise from the PRC
materially injure, or threaten material injury to, a United States
industry. On January 14, 2008, the ITC published its preliminary
determination that there is a reasonable indication that an industry in
the United States is materially injured by reason of allegedly
subsidized imports from the PRC of subject merchandise. See Sodium
Nitrite from China and Germany: Investigation Nos. 701-TA-453 and 731-
TA-1136-1137 (Preliminary), 73 FR 2278, (January 14, 2008).
Application of Facts Available and Use of Adverse Inferences
Section 776 of the Act, governs the use of facts available and
adverse facts available. Section 776(a) provides that if an interested
party or any other person (1) withholds information that has been
requested by the Department; (2) fails to provide such information by
deadlines or in the form and manner requested; (3) significantly
impedes a proceeding; or (4) provides such information but the
information cannot be verified, the Department shall use the facts
otherwise available in reaching its determination. The statute requires
that certain conditions be met before the Department may resort to
facts available. Where the Department determines that a response to a
request for information does not comply with the request, section
782(d) of the Act provides that the Department will so inform the party
submitting the response and will, to the extent practicable, provide
that party an opportunity to remedy or to explain the deficiency.
If the party fails to remedy the deficiency within the applicable
timelines, the Department may, subject to section 782(e) of the Act,
disregard all or part of the original and subsequent responses, as
appropriate. Section 782(e) of the Act states that the Department shall
not decline to consider information deemed ``deficient'' under section
782(d) of the Act if: (1) the information is submitted by the
established deadline; (2) the information can be verified; (3) the
information is not so incomplete that it cannot serve as a reliable
basis for reaching the applicable determination; (4) the interested
party has demonstrated that it acted to the best of its ability; and
(5) the information can be used without undue difficulties.
Section 776(b) of the Act provides that the Department may use an
inference adverse to the interests of a party that has failed to
cooperate by not acting to the best of its ability to comply with the
Department's requests for information. See Statement of Administrative
Action accompanying the Uruguay Round Agreements Act, H.R. Doc. No.
103-316, Vol. 1, 889-90 (1994) (SAA) at 870.
In the Preliminary Determination, the Department based the CVD
rates for the two mandatory company respondents, Shanxi Jiaocheng
Hongxing Chemical Co., Ltd. (Shanxi Jiaocheng) and Tianjin Soda Plant,
together with its subsidiary company, Tianjin Port Free Trade Zone Pan
Bohai International Trading Co., Ltd. (Tianjin Soda Plant) on facts
otherwise available, pursuant to section 776(a)(2)(C) of the Act
because they did not respond to the Department's countervailing duty
questionnaire. Furthermore, in selecting from the facts available, the
Department determined that an adverse inference was warranted, pursuant
to section 776(b) of the Act because Shanxi Jiaocheng and Tianjin Soda
Plant did not respond to the Department's questionnaire and therefore
did not cooperate to the best of their abilities in the investigation.
Preliminary Determination at 19817-18.
Neither the GOC nor Shanxi Jiaocheng or Tianjin Soda Plant have
provided any information or argument that would warrant a
reconsideration of the Department's Preliminary Determination that the
reliance on facts available and the application of adverse inferences
is warranted. Therefore, for purposes of this final determination we
are relying on facts available and applying adverse inferences in
accordance with section 776(b) of the Act.
Selection of the Adverse Facts Available Rate
In deciding which facts to use as adverse facts available, section
776(b) of the Act and 19 CFR 351.308(c)(1) authorize the Department to
rely on information derived from (1) the petition, (2) a final
determination in the investigation, (3) any previous review or
determination, or (4) any other information placed on the record. The
Department has no information on the record of this proceeding from
which to select appropriate AFA rates for any of the subject programs,
and because this is an investigation, we have no previous segments of
the proceeding from which to draw potential AFA rates. In such cases,
it is the Department's practice to select, as adverse facts available,
the highest calculated rate in any segment of the proceeding. See,
e.g., Certain In-shell Roasted Pistachios from the Islamic Republic of
Iran: Final Results of Countervailing Duty Administrative Review
(Pistachios from Iran), 71 FR 66165 (November 13, 2006) and
accompanying Issues and Decision Memorandum at Comment 1. The
Department's practice when selecting an adverse rate from among the
possible sources of information is to ensure that the margin is
sufficiently adverse ``as to effectuate the statutory purposes of the
adverse facts available rule to induce respondents to provide the
Department with complete and accurate information in a timely manner.''
See Notice of Final Determination of Sales at Less than Fair Value:
Static Random Access Memory Semiconductors from Taiwan, 63 FR 8909,
8932 (February 23, 1998). The Department's practice also ensures ``that
the party does not obtain a more favorable result by failing to
cooperate than if it had cooperated fully.'' See SAA at 870. In
choosing the appropriate balance between providing a respondent with an
incentive to respond accurately and imposing a rate that is reasonably
related to the respondent's prior commercial activity, selecting the
highest prior rate ``reflects a common sense inference that the highest
prior margin is the most probative evidence of current margins,
because, if it were not so, the importer, knowing of the rule, would
have produced current information showing the margin to be less.'' See
Rhone Poulenc, Inc. v. United States, 899 F. 2d 1185, 1190 (Fed. Cir.
1990).
As stated in the Preliminary Determination, the Department
determined that Shanxi Jiaocheng and Tianjin Soda Plant each failed to
act to the best of its ability in this investigation; thus, for each
program examined, the Department made the adverse inference that each
company benefitted from the program, consistent with our practice. See,
e.g., Certain Cold-Rolled Carbon Steel Flat Products from the Republic
of Korea; Final Affirmative Countervailing Duty Determination, 67 FR
62102 (October 3, 2002). In addition, we stated in the Preliminary
Determination that our practice is to rely upon the highest calculated
program rate for the same program or for a similar type of program.\1\
See e.g., Circular Welded
[[Page 38983]]
Carbon Quality Steel Pipe from the People's Republic of China: Final
Affirmative Countervailing Duty Determination and Final Affirmative
Determination of Critical Circumstances, 73 FR 31966 (June 5, 2008) and
accompanying Issues and Decision Memorandum at 2 (CWP from the PRC);
CFS from the PRC at Comment 24; Laminated Woven Sacks from the People's
Republic of China: Final Affirmative Countervailing Duty Determination
and Final Affirmative Determination, in Part, of Critical
Circumstances, 73 FR 35639 (June 24, 2008) and accompanying Issues and
Decision Memorandum at 6-8 (LWS from the PRC); see also Light-Walled
Rectangular Pipe and Tube From People's Republic of China: Final
Affirmative Countervailing Duty Investigation Determination, 73 FR
35642 (June 24, 2008) and accompanying Issues and Decision Memorandum
at 2 (LWRP from the PRC). We have selected the adverse facts available
rate to apply to each program, for purposes of this final
determination, consistent with this practice.
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\1\ The Department's first preference is to use the highest
calculated rate for the same program (i.e. identical program). If
there is no identical program, then the Department will use the
highest calculated rate for a similar program (e.g. tax program to
tax program, loan program to loan program).
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Information from the petition indicates that during the POI, the
standard income tax for corporations in China was 30 percent and there
is an additional local income tax at the rate of three percent. See the
November 8, 2007 letter to the Secretary of Commerce, at Exhibit IV-12.
To determine the program rate for the 16 alleged income tax programs
under which companies receive either a reduction or exemption of income
tax, we have applied an adverse inference that Shanxi Jiaocheng and
Tianjin Soda Plant paid no income taxes during the POI. Therefore, the
highest possible combined countervailable subsidy for the 16 national,
provincial, and local income tax programs subject to this investigation
total 33 percent. Thus, we are applying a countervailable rate of 33
percent on an overall basis for the 16 income tax programs (i.e., the
16 income tax programs combined provided a countervailable subsidy of
33 percent). This 33 percent AFA rate does not apply to income tax
credit or income tax refund programs.
For the remaining programs subject to this investigation (including
income tax credit and income tax refund programs), we are applying,
where applicable, the highest countervailable subsidy rate that was
calculated in a prior final countervailing duty determination for a
product from the PRC for the same or similar type of program (i.e.,
subsidy programs regarding tax refunds or credits, value-added tax
(VAT), and government-provided grants and loans). See CFS from the PRC
at Comment 24 and LWS from the PRC at 6-8. Absent a subsidy rate for
the same or similar type of program, we are applying the highest
countervailable subsidy rate for any program otherwise listed in any
prior final countervailing duty determination involving the PRC.\2\ See
id.
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\2\ In applying the highest calculated countervailable subsidy
rate for any program otherwise listed, we are disregarding the
calculated rates for the programs ``Hot-Rolled Steel For Less Than
Adequate Remuneration'' (CWP from the PRC), and ``Government
Provision of Inputs for Less Than Adequate Remuneration'' (LWS from
the PR C), because the industry under investigation in this
proceeding cannot use the products for which these rates were
calculated. See Sodium Nitrite From the Federal Republic of Germany
And The People's Republic of China: Petition For The Imposition of
Antidumping And Countervailing Duties, (November 8, 2007) Volume I
at 32-33. See also Sodium Nitrite from China and Germany:
Investigation Nos. 701-TA-453 and 731-TA-1136-1137 (Preliminary),
ITC Publication 3979, January 2008 at 8. The Department's decision
to not use, as AFA, these program rates is based on the particular
facts of this investigation and this particular set of facts may not
be applicable or identifiable in another proceeding.
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For a discussion of the application of the AFA rates for each
program determined to be countervailable, see Memorandum to the File,
Sodium Nitrite from the PRC; Calculation of Countervailable Subsidy
Rates for the Final Determination, dated concurrently with this notice
(Sodium Nitrite Calculation Memorandum). Attached to this memorandum
are copies of CFS from the PRC, LWS from the PRC, CWP from the PRC, and
LWRP from the PRC, which contain the public information concerning
subsidy programs, including the subsidy rates, upon which we are
relying as adverse facts available. See Sodium Nitrite Calculation
Memorandum.
Section 776(c) of the Act provides that, when the Department relies
on secondary information rather than on information obtained in the
course of an investigation or review, it shall, to the extent
practicable, corroborate that information from independent sources that
are reasonably at its disposal. To corroborate secondary information,
the Department will, to the extent practicable, examine the reliability
and relevance of the information to be used. The SAA emphasizes,
however, that the Department need not prove that the selected facts
available are the best alternative information. See SAA at 869.
With regard to the reliability aspect of corroboration, we note
that these rates were calculated in prior final countervailing duty
determinations. No information has been presented that calls into
question the reliability of these calculated rates that we are applying
as AFA. Unlike other types of information, such as publicly available
data on the national inflation rate of a given country or national
average interest rates, there typically are no independent sources for
data on company-specific benefits resulting from countervailable
subsidy programs.
With respect to the relevance aspect of corroboration, the
Department will consider information reasonably at its disposal in
considering the relevance of information used to calculate a
countervailable subsidy benefit. Where circumstances indicate that the
information is not appropriate as adverse facts available, the
Department will not use it. See, e.g., Fresh Cut Flowers from Mexico;
Final Results of Antidumping Duty Administrative Review, 61 FR 6812
(February 22, 1996). In the absence of record evidence concerning these
programs due to respondents' decision not to participate in the
investigation, the Department has reviewed the information concerning
China subsidy programs in this and other cases. For those programs for
which the Department has found a program-type match, we find that
programs of the same type are relevant to the programs of this case.
For the programs for which there is no program-type match, the
Department has selected the highest calculated subsidy for any China
program from which the respondents could conceivably receive a benefit
to use as AFA. The rate is therefore relevant to the respondents in
that it is an actual calculated CVD rate for a China program from which
the respondents could receive a benefit. No evidence had been presented
or obtained which contradicts the reliability or relevance of the
secondary information which was information from a prior China CVD
investigation. See Preliminary Determination at 19819. Due to the lack
of participation by the respondents and the resulting lack of record
information concerning these programs, the Department has corroborated
the rates it selected to the extent practicable.
Final Determination
In accordance with section 705(c)(1)(B)(i) of the Act, we have
assigned a subsidy rate to each of the two producers/exporters of the
subject merchandise that were selected as mandatory respondent
companies in this CVD investigation. We determine
[[Page 38984]]
the total net countervailable subsidy rates to be:
------------------------------------------------------------------------
Producer/Exporter Subsidy Rate
------------------------------------------------------------------------
Shanxi Jiaocheng Hongxing Chemical Co., 169.01%
Ltd. (Shanxi Jiaocheng)..................
Tianjin Soda Plant Tianjin Port Free Trade 169.01%
Zone Pan Bohai International Trading Co.,
Ltd. (Tianjin Soda Plant)................
All Others................................ 169.01%
------------------------------------------------------------------------
With respect to the all others rate, section 705(c)(5)(A)(ii) of
the Act provides that if the countervailable subsidy rates established
for all exporters and producers individually investigated are
determined entirely in accordance with section 776 of the Act, the
Department may use any reasonable method to establish an all others
rate for exporters and producers not individually investigated. In this
case, the rate established for the two mandatory respondents is based
entirely on facts available under section 776 of the Act. There is no
other information on the record upon which we could determine an all
others rate. As a result, we have used the AFA rate assigned for Shanxi
Jiaocheng and Tianjin Soda Plant as the all others rate. This method is
consistent with the Department's past practice. See e.g. Final
Affirmative Countervailing Duty Determination: Certain Hot-Rolled
Carbon Steel Flat Products From Argentina, 66 FR 37007, 37008 (July 16,
2001); see also Final Affirmative Countervailing Duty Determination:
Prestressed Steel Wire Strand From India, 68 FR 68356, 68357 (December
8, 2003).
Suspension of Liquidation and Cash Deposit Requirements
In accordance with sections 705(c)(1)(B) of the Act, we directed
U.S. Customs and Border Protection (CBP) to suspend liquidation of all
entries of the subject merchandise from the PRC, which are entered or
withdrawn from warehouse, for consumption on or after April 11, 2008,
the date of publication of the Preliminary Determination. In accordance
with sections 705(c)(1)(B) of the Act, we will instruct CBP to require
cash deposits at the rates shown above on all entries of the subject
merchandise from the PRC, entered or withdrawn from warehouse, for
consumption on or after the date of publication of this final
determination.
If the ITC issues a final affirmative injury determination, we will
issue a countervailing duty order under section 706(a) of the Act. If
the ITC determines that material injury to, threat of material injury
to, or material retardation of, the domestic industry does not exist,
this proceeding will be terminated and all estimated duties deposited
or securities posted as a result of the suspension of liquidation will
be refunded or canceled.
ITC Notification
In accordance with section 705(d) of the Act, we will notify the
ITC of our determination. In addition, we are making available to the
ITC all non-privileged and non-proprietary information related to this
investigation. We will allow the ITC access to all privileged and
business proprietary information in our files, provided the ITC
confirms it will not disclose such information, either publicly or
under an administrative protective order (APO), without the written
consent of the Assistant Secretary for Import Administration.
Return or Destruction of Proprietary Information
In the event that the ITC issues a final negative injury
determination, this notice will serve as the only reminder to parties
subject to APO of their responsibility concerning the destruction of
proprietary information disclosed under APO in accordance with section
351.305(a)(3) of the Department's regulations. Failure to comply is a
violation of the APO.
This determination is issued and published pursuant to sections
705(d) and 777(i) of the Act.
Dated: June 30, 2008.
David M. Spooner,
Assistant Secretary for Import Administration.
[FR Doc. E8-15479 Filed 7-7-08; 8:45 am]
BILLING CODE 3510-DS-S