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Notice

Sebacic Acid From the People's Republic of China: Notice of Preliminary Results of Changed Circumstances Review and Preliminary Intent Not To Revoke the Antidumping Duty Order

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Information about this document as published in the Federal Register.

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This document has been published in the Federal Register. Use the PDF linked in the document sidebar for the official electronic format.

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AGENCY:

Import Administration, International Trade Administration, Department of Commerce.

EFFECTIVE DATE:

March 27, 2003.

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FOR FURTHER INFORMATION CONTACT:

Mike Strollo or Gregory E. Kalbaugh at (202) 482-0629 or (202) 482-3693, respectively, Office of AD/CVD Enforcement, Office 2, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, NW., Washington, DC 20230.

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SUMMARY:

On January 10, 2003, in response to a request by Moreflex, Inc., a U.S. importer of subject merchandise and an interested party in this proceeding, the Department of Commerce initiated a changed circumstances review to consider revocation of the antidumping duty order on sebacic acid from the People's Republic of China.

We preliminarily determine that there is no reasonable basis to believe that changed circumstances sufficient to warrant revocation exist because interested parties have expressed interest in maintaining the antidumping duty order, and there are no grounds for assuming that revocation of the order is supported by “substantially all” of the domestic producers of the like product. Consequently, we preliminarily do not intend to revoke the order on sebacic acid from the People's Republic of China. Interested parties are invited to comment on these preliminary results.

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SUPPLEMENTARY INFORMATION:

Background

On July 14, 1994, the Department published in the Federal Register the antidumping duty order on sebacic acid from the People's Republic of China (PRC). See Antidumping Duty Order: Sebacic Acid From the People's Republic of China, 59 FR 35909 (July 14, 1994). On November 26, 2002, Morflex, Inc. (Morflex), a U.S. importer of subject merchandise and an interested party in this proceeding, requested that the Department revoke the antidumping duty order on sebacic acid from the PRC through a changed circumstances review. According to Morflex, Arizona Chemical Corporation (ACC), a domestic producer of sebacic acid, intended to cease production of sebacic acid in the United States at the end of November 2002. ACC asserts that it is the successor-in-interest to the original petitioner in this proceeding, Union Camp Corporation. In addition, on September 25, 2002, prior to Morflex's request, ACC notified the Department that it intended to cease production of sebacic acid no later than December 31, 2002.

Based on the information submitted by Morflex and ACC, the Department determined that there was sufficient evidence of changed circumstances to warrant a review under section 751(b)(1) of the Tariff Act of 1930, as amended (the Act), and 19 CFR 351.222(g) and 351.216, and consequently, we initiated a changed circumstances review on January 10, 2003. See Sebacic Acid from the People's Republic of China: Notice of Initiation of Changed Circumstances Review and Consideration of Revocation of the Antidumping Duty Order, 68 FR 2315-01 (January 16, 2003) (Initiation Notice). In the Initiation Notice, we stated that the Department would consider whether there is interest in Start Printed Page 14946continuing the order on the part of the U.S. industry, and we invited comments from interested parties. We also stated that the Department would publish in the Federal Register a notice of preliminary results of changed circumstances review, in accordance with 19 CFR 351.221(c)(3)(i), prior to the issuance of the final results.

Since the Department's notice of initiation of this review, the following events have occurred. On January 13, 2003, the Department issued questionnaires to ACC and an additional U.S. producer of sebacic acid, CasChem Inc. (CasChem), seeking to determine whether producers accounting for substantially all of the production of the domestic like product to which the order pertains have expressed a lack of interest in the order.

On January 26, 2003, we received a submission from SST Materials, Inc., doing business as Genesis Chemicals, Inc. (Genesis), a domestic manufacturer and distributor of sebacic acid, which indicated that Genesis opposes revocation of the antidumping duty order. On January 28, 2003, the Department issued a follow-up questionnaire to Genesis.

On January 31, 2003, ACC submitted a response to the Department's questionnaire, in which it indicated that its production of sebacic acid ceased on December 19, 2002. However, ACC noted that it opposes the revocation of the antidumping duty order since it has facilities, employees, and resources in place for the purpose of selling its remaining inventory of sebacic acid.

On February 5, 2003, the Department received comments opposing the revocation of the antidumping duty order from both Genesis and ICC Chemical Corporation (ICC), a U.S. importer of sebacic acid from the PRC.

On February 11, 2003, we received additional information from Genesis in which Genesis indicated that it began domestic production of sebacic acid late in 2002, and currently accounts for all new domestic sebacic acid production. CasChem did not respond to the Department's questionnaire.[1]

Scope of the Review

The products covered by this review are all grades of sebacic acid, a dicarboxylic acid with the formula (CH2)8 (COOH)2, which include but are not limited to CP Grade (500ppm maximum ash, 25 maximum APHA color), Purified Grade (1000ppm maximum ash, 50 maximum APHA color), and Nylon Grade (500ppm maximum ash, 70 maximum ICV color). The principal difference between the grades is the quantity of ash and color. Sebacic acid contains a minimum of 85 percent dibasic acids of which the predominant species is the C10 dibasic acid. Sebacic acid is sold generally as a free-flowing powder/flake.

Sebacic acid has numerous industrial uses, including the production of nylon 6/10 (a polymer used for paintbrush and toothbrush bristles and paper machine felts), plasticizers, esters, automotive coolants, polyamides, polyester castings and films, inks and adhesives, lubricants, and polyurethane castings and coatings.

Sebacic acid is currently classifiable under subheading 2917.13.00.30 of the Harmonized Tariff Schedule of the United States (HTSUS). Although the HTSUS subheading is provided for convenience and customs purposes, our written description of the scope of this proceeding is dispositive.

Analysis

Pursuant to section 751(d) of the Act, the Department may revoke an antidumping duty order based on a review under section 751(b) of the Act. Section 782(h)(2) of the Act and 19 CFR 351.222(g)(1)(i) provide that the Department may revoke an order, in whole or in part, based on changed circumstances if “(p)roducers accounting for substantially all of the production of the domestic like product to which the order (or the part of the order to be revoked) * * * have expressed a lack of interest in the order, in whole or in part * * *” In this context, the Department has interpreted “substantially all” production normally to mean at least 85 percent of domestic production of the like product (see Oil Country Tubular Goods From Mexico: Preliminary Results of Changed Circumstances Antidumping Duty Administrative Review, 64 FR 14213, 14214 (March 24, 1999)).

In order to determine whether “substantially all” of the domestic producers supported revocation of the order with respect to the merchandise in question, we solicited comments from all known domestic producers of sebacic acid. See Initiation Notice. As noted above, we received objections from ACC and Genesis.[2] We note that because ACC and CasChem no longer produce sebacic acid, they are no longer considered “interested parties” pursuant to section 771(9)(C) of the Act. Nonetheless, Moreflex's submission contains no evidence indicating that at least 85 percent of the domestic industry of the like product has no interest in the continuance of the order with respect to the merchandise in question. Given that Genesis objects to the revocation of the antidumping duty order, and has indicated that it comprises the universe of domestic sebacic acid producers, we have preliminarily determined that there are no grounds for concluding that at least 85 percent of the domestic industry has expressed a lack of interest in maintaining the order.

Notice of Intent Not To Revoke the Antidumping Duty Order

Under the definition of “substantially all,” as indicated above, there are no grounds for assuming that revocation of the order is supported by “substantially all” of the domestic producers of the like product. As a result, we preliminarily determine that changed circumstances sufficient to warrant revocation of the antidumping duty order on sebacic acid from the PRC do not exist. The current requirements for the cash deposit of estimated antidumping duties on the subject merchandise will remain in effect until the publication of the final results of this review. Parties wishing to comment on these results must submit briefs to the Department within 30 days after the publication of this notice in the Federal Register. Parties will have five days subsequent to this due date to submit rebuttal briefs. Parties who submit comments or rebuttal briefs in this proceeding are requested to submit with the argument: (1) A statement of the issue, and (2) a brief summary of the argument (no longer than five pages, including footnotes). Any requests for hearing must be filed within 30 days of the publication of this notice in the Federal Register. In accordance with 19 CFR 351.216(e), the Department will issue its final results of review within 270 days after the date on which the changed circumstances review was initiated (i.e., no later than October 7, 2003).

This notice is published in accordance with sections 751(b)(1) and (d) and 777(i) of the Act, and with 19 CFR 351.221(c)(3).

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Dated: March 20, 2003.

Joseph A. Spetrini,

Acting Assistant Secretary for Import Administration.

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Footnotes

1.  ACC, ICC, and Genesis each placed on the record an article from the trade journal “Chemical Market Reporter,” dated January 20, 2003, which indicated that: (1) ACC and CasChem had been the only domestic producers of sebacic acid but both ceased domestic production of sebacic acid in December 2002; (2) Genesis began producing sebacic acid in December 2002; and (3) Genesis, as of January 2003, was the sole domestic producer of sebacic acid.

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2.  While we did receive objections from ICC, pursuant to 782(h)(2) of the Act, only objections from producers of domestic like product are considered when the Department makes a determination of whether there is interest in maintaining the order.

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[FR Doc. 03-7363 Filed 3-26-03; 8:45 am]

BILLING CODE 3510-DS-P