Skip to Content

Notice

Petroleum Wax Candles From the People's Republic of China: Initiation of Anticircumvention Inquiries of Antidumping Duty Order

Document Details

Information about this document as published in the Federal Register.

Published Document

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

Start Preamble

AGENCY:

Import Administration, International Trade Administration, Department of Commerce.

ACTION:

Notice of Initiation of Anticircumvention Inquiries of Antidumping Duty Order: Petroleum Wax Candles from the People's Republic of China.

SUMMARY:

In response to a request from the National Candle Association (“NCA” or “Petitioners”), the Department of Commerce (“the Department”) is initiating an anticircumvention inquiry pursuant to section 781(c) of the Tariff Act of 1930, as amended, (“the Act”) to determine whether mixed wax candles composed of petroleum wax and varying amounts of either palm or vegetable-based waxes have been subject to a minor alteration such that the addition of the non-petroleum content to these candles results in products that are “altered in form or appearance in minor respects” from the subject merchandise that these mixed wax petroleum candles can be considered subject to the antidumping duty order on petroleum wax candles from the People's Republic of China (“PRC”) under the minor alterations provision. See Notice of Antidumping Duty Order: Petroleum Wax Candles from the People's Republic of China, 51 FR 30686 (August 28, 1986) (“Order”).Start Printed Page 10963

In addition, in response to a request from the NCA, the Department is also initiating an anticircumvention inquiry pursuant to section 781(d) of the Act to determine whether mixed wax candles composed of petroleum wax and varying amounts of either palm or vegetable-based waxes are later-developed products that can be considered subject to the antidumping duty order on petroleum wax candles from the PRC under the later-developed merchandise provision.

EFFECTIVE DATE:

March 7, 2005.

Start Further Info

FOR FURTHER INFORMATION CONTACT:

Alex Villanueva, Julia Hancock, or Nicole Bankhead, AD/CVD Operations, Office 9, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, NW., Washington, DC, 20230; telephone: (202) 482-3208, (202) 482-1394, and (202) 482-9068, respectively.

End Further Info End Preamble Start Supplemental Information

SUPPLEMENTARY INFORMATION:

Background

On October 8, 2004, Petitioners requested that the Department conduct an anticircumvention inquiry pursuant to section 781(d) of the Act to determine whether candles containing palm or vegetable-based waxes as the majority ingredient and exported to the United States are circumventing the antidumping duty order on petroleum wax candles from the PRC.

On October 12, 2004, Petitioners requested that the Department conduct an anticircumvention inquiry pursuant to section 781(c) of the Act to determine whether candles containing palm or vegetable-based waxes and exported to the United States are circumventing the antidumping duty order on petroleum wax candles from the PRC.

On November 15, 2004, the Candle Corporation of America (“CCA”), a domestic producer, submitted comments in opposition to Petitioners' request that the Department initiate this anticircumvention inquiry. On November 15, 2004, the Department extended the deadline by three weeks for initiating the later-developed merchandise anticircumvention inquiry from November 22, 2004, to December 13, 2004. In addition, on November 15, 2004, the Department extended by three weeks the deadline for initiating the minor alterations anticircumvention inquiry, from November 26, 2004, to December 17, 2004.

On November 16, 2004, Russ Berrie & Company, Inc. (“Russ Berrie”), a domestic importer, submitted comments in opposition to Petitioners' request that the Department initiate an anticircumvention inquiry.

On December 2, 2004, J.C. Penney Company, Inc., Target Corporation, the National Retail Federation, the MVP Group, the Candle Company, and the World at Large, hereinafter collectively known as the Coalition for Free Trade in Candles (“CFTC”), which represents these domestic importers, submitted comments in opposition to Petitioners' request that the Department initiate an anticircumvention inquiry.

On December 6, 2004, Fine Arts Marketing, Inc.; HomeScents, Inc.; Lava Enterprises Inc.; Makebest Industries, Ltd.; Silk Road Gifts, Inc.; Tag Trade Associates Group, Ltd. and Zodax, Inc., hereinafter collectively referred to as the “Tuttle Importers,” submitted comments in these domestic importers' opposition to Petitioners' request that the Department initiate an anticircumvention inquiry.

On December 9, 2004, Petitioners submitted rebuttal comments to the Department in response to comments made by those parties opposing Petitioners' request for the initiation of an anticircumvention inquiry.

On December 10, 2004, Pier 1 Imports (U.S.), Inc. (“Pier 1”), a domestic importer, submitted comments in opposition to Petitioners' request that the Department initiate an anticircumvention inquiry.

On December 13, 2004, the Department extended the later-developed merchandise anticircumvention initiation deadline because additional information was needed for the Department to make a decision within the established time limits to initiate an anticircumvention inquiry. The deadline for initiating the later-developed merchandise anticircumvention inquiry was extended by sixty days from December 13, 2004, to February 11, 2005. Also on December 13, 2004, the Department issued a supplemental questionnaire to Petitioners regarding several areas in the later-developed merchandise anticircumvention request that needed further clarification.

In addition, on December 13, 2004, the Department extended the minor alterations anticircumvention initiation deadline a second time because additional information was needed Department to make a decision within the established time limits to initiate an anticircumvention inquiry. The deadline for initiating the minor alterations anticircumvention inquiry was extended by sixty days from December 17, 2004, to February 15, 2005. Also, on December 13, 2004, the Department issued a supplemental questionnaire to Petitioners addressing several areas in the minor alterations anticircumvention request that needed further clarification.

On December 17, 2004, Petitioners requested an extension of three weeks to respond to the Department's supplemental questionnaires. On December 20, 2004, the Department granted Petitioners an extension of fifteen days from December 27, 2004, to January 14, 2005, to respond to the Department's supplemental questionnaires. On January 14, 2005, Petitioners submitted a response to the supplemental questionnaires issued by the Department.

On January 24, 2005, the CFTC requested that the Department extend the deadline for initiating the anticircumvention inquiry by one month from February 11, 2005, to March 11, 2005.

On January 25, 2005, Petitioners submitted samples of candles, which were referenced in the supplemental questionnaire response filed on January 14, 2005.

On January 27, 2005, Petitioners submitted comments in opposition to the CFTC's request to extend the deadline for initiating the anticircumvention inquiry.

On January 28, 2005, CCA submitted comments in response to Petitioners' supplemental questionnaire response.

On January 31, 2005, the Department extended the later-developed merchandise anticircumvention initiation deadline a third time because domestic interested parties needed additional time to respond to Petitioners' supplemental response. The deadline for initiating the later-developed merchandise anticircumvention inquiry was extended by ten days from February 11, 2005, to February 22, 2005. Also, on January 31, 2005, the Department extended the anticircumvention initiation deadline for the minor alterations anticircumvention inquiry by ten days from February 15, 2005, to February 25, 2005. In addition, on January 31, 2005, the Department granted CFTC and other interested parties an extension of ten days from January 28, 2005, to February 7, 2005, to submit factual information rebutting, clarifying, or corroborating factual information submitted by Petitioners to respondents on January 18, 2005.

Also on January 31, 2005, Russ Berrie requested that the Department extend the deadline for initiation. In its submission, Russ Berrie noted that it had submitted interim comments rebutting Petitioners' supplemental response in case in which the Start Printed Page 10964Department did not extend the deadline as previously requested by the CFTC.

On February 2, 2005, CFTC submitted comments in response to Petitioners' supplemental questionnaire responses.

On February 7, 2005, Petitioners submitted rebuttal comments in response to comments made by interested parties regarding Petitioners' supplemental response. On February 7, 2005, Silk Road Gifts, Ltd. (“Silk Road”), a domestic importer, submitted comments in response to Petitioners' supplemental response. Also on February 7, 2005, CFTC submitted additional comments and samples of candles.

On February 11, 2005, the Department placed a memorandum on the file regarding the ex parte meeting the Department had with counsel for Petitioners on February 10, 2005.

On February 16, 2005, the Department placed a memorandum on the file regarding the ex parte meeting Acting Assistant Secretary Joseph Spetrini had with members of the Coalition for Free Trade in Candles on February 15, 2005.

On February 18, 2005, the Department extended the initiation deadline of the anticircumvention inquiry by three days from February 22, 2005, to February 25, 2005. Additionally, on February 18, 2005, Qindao Kingking Applied Chemistry Co., Ltd.; Shonfeld's (USA), Inc.; Alef Judaica, Inc.; and Amscan, Inc. submitted comments in response to Petitioners' supplemental questionnaire response.

On February 24, 2005, a memorandum to the file was placed by the Department regarding the ex parte meeting that the Acting Assistant Secretary Joseph Spetrini had with counsel for Petitioners on February 23, 2005. Additionally, on February 24, 2005, Petitioners filed further rebuttal comments.

Scope of 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; round, columns, pillars, votives; and various wax-filled containers. The products were classified under the Tariff Schedules of the United States (“TSUS”) 755.25, Candles and Tapers. The product covered 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 purposes, our written description remains dispositive. See Order; see also Notice of Final Results of the Antidumping Duty New Shipper Review: Petroleum Wax Candles from the People's Republic of China, 69 FR 77990 (December 29, 2004).

Initiation of Minor Alterations Anticircumvention Proceeding

Section 781(c)(1) of the Act provides that the Department may find circumvention of an antidumping duty order when products which are of the class or kind of merchandise subject to an antidumping duty order have been “altered in form or appearance in minor respects * * * whether or not included in the same tariff classification.”

Based on the language contained in the petition, the antidumping duty order, and the fact that the domestic “like product” determinations of the ITC are not dispositive, the Department finds that there is sufficient basis to initiate an anticircumvention inquiry pursuant to section 781(c) of the Act to determine whether the addition of vegetable and/or palm-based wax results in a minor alteration, and thus, a change so insignificant as to render the petroleum based, mixed candle subject to the antidumping duty order on petroleum wax candles from the PRC.1

Scope of the Minor Alterations Anticircumvention Proceeding

Petitioners argue that it is almost impossible to specify in this application all or most all PRC producers and importers of mixed wax petroleum wax candles containing varying amounts of palm or other vegetable-based waxes because of the continuously increasing quantity of imports of these candles into the United States. Additionally, Petitioners argue that an application requesting an anticircumvention inquiry and a resulting determination finding circumvention limited to only a few companies and specific candles would have little to no effect in preventing circumvention of the order.

The Department recognizes that Petitioners have limited information available to them at this time regarding the production, exportation and importation of mixed wax petroleum wax candles containing varying amounts of palm or other vegetable-based waxes. Specifically, we agree that obtaining subject and non-subject import data from the only tariff classification for all candles and the unknown number of companies producing and exporting to the United States mixed wax petroleum wax candles containing varying amounts of palm and/or vegetable-based waxes is difficult. However, we also note that Petitioners have provided a list of companies importing and, to a certain extent, identified those companies producing/exporting mixed wax petroleum wax candles varying amounts of palm and/or vegetable-based waxes based on that companies' scope ruling request submitted to the Department. See Petitioners' Minor Alterations Supplemental Response (January 14, 2005) at Appendix I. In addition, Petitioners have provided, where available, specific model/product/SKU numbers for consideration in this anticircumvention inquiry using the data from the companies' scope ruling requests previously submitted to the Department. See Petitioners' Minor Alterations Submission (October 12, 2004) at Appendix 1.

We are initiating this anticircumvention inquiry on particular PRC exporters, as identified by Petitioners in Appendix 1 of their January 14, 2005, submission. However, within 45 days of the date of initiation of this inquiry, if the Department receives sufficient evidence that other PRC manufacturers are involved in the production of mixed wax petroleum wax candles containing varying amounts of palm and/or vegetable-based waxes for export to the United States, we will consider examining such additional manufacturers.

The Department will not order the suspension of liquidation of entries of any additional merchandise at this time. However, in accordance with 19 CFR 351.225(l)(2), if the Department issues a preliminary affirmative determination, we will then instruct U.S. Customs and Border Protection (“CBP”) to suspend liquidation and require a cash deposit of estimated duties on the merchandise.

Initiation of Later-Developed Merchandise Anticircumvention Proceeding

Section 781(d)(1)(A) of the Act provides that the Department may find circumvention of an antidumping duty order when merchandise is developed after an investigation is initiated (“later-developed merchandise”).

Based on the language contained in the petition and the antidumping duty order, and the fact that the domestic like product determinations of the International Trade Commission (“ITC”) is not dispositive, the Department finds that there is sufficient basis to initiate an anticircumvention inquiry pursuant to section 781(d) of the Act to determine whether candles produced through the Start Printed Page 10965addition of vegetable and/or palm-based wax to petroleum wax are later-developed products that can be considered subject to the antidumping duty order on petroleum wax candles from the PRC under the later-developed merchandise provision.2

The Department recognizes that the ITC's final injury determination states that “commercial production of candles generally uses “natural” waxes (paraffins, microcrystallines, stearic acid, and beeswax) in various combinations.” See Candles from the People's Republic of China, Investigation No. 731-TA-282 (Final), USITC Publication 1888 (August 1986) at 2 (“ITC Final Determination”). In addition, we note that the ITC Final Determination defined petroleum wax candles “as those composed of over 50 percent petroleum wax,” and noted that such candles “may contain other waxes in varying amounts, depending on the size and shape of the candle, to enhance the melt-point, viscosity, and burning power.” Id. However, because the Department did not address the proportion of these waxes that would be indicative of petroleum wax candles, there is no clear basis for the Department to make a conclusive determination that candles with non-petroleum waxes in a different proportion are not later-developed merchandise. Consequently, we are initiating this inquiry under section 781(d) of the Act.

In addition, parties may submit comments regarding the appropriateness of our later-developed analysis as provided in this notice, no later than thirty days from the date of publication of this notice. Rebuttal comments are due no later than forty days from the date of publication of this notice.

The Department will not order the suspension of liquidation of entries of any additional merchandise at this time. However, in accordance with 19 CFR 351.225(l)(2), if the Department issues a preliminary affirmative determination, we will then instruct CBP to suspend liquidation and require a cash deposit of estimated duties on the merchandise.

We intend to notify the ITC in the event of an affirmative preliminary determination of circumvention, in accordance with 781(e)(1) of the Act and 19 CFR 351.225(f)(7)(i)(C).The Department will, following consultation with interested parties, establish a schedule for questionnaires and comments on the issues. The Department intends to issue its final determinations within 300 days of the date of publication of this initiation. This notice is published in accordance with sections 781(c) and 781(d) of the Act and 19 CFR 351.225(i).

Start Signature

Dated: February 25, 2005.

Joseph A. Spetrini,

Acting Assistant Secretary for Import Administration.

End Signature End Supplemental Information

Footnotes

1.  The various comments submitted by interested parties will be considered by the Department in its final determination.

Back to Citation

2.  The Department recognizes that certain parties submitted comments addressing certain factors as required by section 781(d) of the Act, however the Department will address these comments in the final determination.

Back to Citation

[FR Doc. E5-918 Filed 3-4-05; 8:45 am]

BILLING CODE 3510-DS-S