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Notice of Preliminary Results of Antidumping Duty Changed Circumstances Review: Polyethylene Terephthalate Film, Sheet and Strip from India

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Information about this document as published in the Federal Register.

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AGENCY:

Import Administration, International Trade Administration, Department of Commerce.

SUMMARY:

On September 21, 2004, the Department of Commerce (the Department) initiated a changed circumstances review of polyethylene terephthalate film, sheet and strip (PET film) from India in order to determine whether Jindal Poly Films Limited is the successor-in-interest for purposes of antidumping duties to Jindal Polyester Limited. See Notice of Initiation of Antidumping Duty Changed Circumstances Review: Polyethylene Terephthalate Film, Sheet and Strip (PET Film) from India, 69 FR 56406 (September 21, 2004). Jindal Polyester Limited changed its name to Jindal Poly Films Limited on April 19, 2004. We preliminarily determine that Jindal Poly Films Limited is the successor-in-interest to Jindal Polyester Limited for purposes of determining antidumping duty liability. Interested parties are invited to comment on these preliminary results.

EFFECTIVE DATE:

April 22, 2005.

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FOR FURTHER INFORMATION CONTACT:

Jeffrey Pedersen or Kavita Mohan, AD/CVD Operations, Office 4, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, NW., Washington, DC 20230; telephone (202) 482-2769 and (202) 482-3542, respectively.

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SUPPLEMENTARY INFORMATION:

Background

On July 1, 2002, the Department published the antidumping duty order on PET film from India in the Federal Register (67 FR 44175). On July 29, 2004, Jindal Polyester Limited/Jindal Poly Films Limited (Jindal) requested that the Department conduct an expedited changed circumstances review of the antidumping duty order on PET film from India. In its request, Jindal claimed that Jindal Poly Films Limited is the successor-in-interest to Jindal Polyester Limited, and, as such, is entitled to receive the same antidumping treatment accorded to Jindal Polyester Limited. On August 25, 2004, DuPont Teijin Films, Mitsubishi Polyester Film of America and Toray Plastics (America), Inc. (petitioners) notified the Department that they oppose Jindal's request for expedited action in this review and provided the Department with information indicating the Jindal underwent changes in addition to its name change. On September 21, 2004, the Department published in the Federal Register a notice of its initiation of the instant changed circumstances review in which it refused Jindal's request for expedited action, noting that additional information was needed in order for the Department to make its preliminary determination.

Scope of the Order

The products covered by this order are all gauges of raw, pretreated, or primed PET film, whether extruded or coextruded. Excluded are metallized films and other finished films that have had at least one of their surfaces modified by the application of a performance-enhancing resinous or inorganic layer of more than 0.00001 inches thick. Imports of PET film are classifiable in the Harmonized Tariff Schedule of the United States (HTSUS) under item number 3920.62.00. HTSUS subheadings are provided for convenience and customs purposes. The written description of the scope of this order is dispositive.

Preliminary Results of Changed Circumstances Review

In making a successor-in-interest determination, the Department examines several factors including, but not limited to, changes in: (1) Management; (2) production facilities; (3) supplier relationships; and (4) customer base. See Brass Sheet and Strip from Canada: Final Results of Antidumping Duty Administrative Review, 57 FR 20460, 20462 (May 13, 1992) (Canadian Brass). While no one single factor, or combination of factors, will necessarily prove to be dispositive, the Department will generally consider a new company to be the successor-in-interest to its predecessor company if its resulting operations are essentially the same as those of its predecessor. See, e.g., Canadian Brass at 20460, and Final Results of Changed Circumstances Antidumping Duty Administrative Review: Industrial Nitrocellulose From Korea, 65 FR 2115, 2116 (January 13, 2000). Therefore, if there is evidence demonstrating that, with respect to the production and sale of subject merchandise, a new company essentially operates as the same business entity as the former company, the Department will assign the new company the cash deposit rate of its predecessor.

Although Jindal reported that it simply changed its name from Jindal Polyester Limited to Jindal Poly Films Limited, the petitioners placed documents on the record indicating that, in addition to Jindal's name change, the company experienced a change in management,[1] and undertook an expansion and restructuring of its operations in connection with its acquisition of Rexor, S.A., France (Rexor), a French processor (not producer) of PET film. See Petitioners' August 25, 2004, letter at 3-4.2

In response to the Department's questionnaires, Jindal reported that it changed its name to Jindal Poly Films Limited in April 2004 to reflect its increased presence in the film business (both PET film and non-subject polypropylene (BOPP) film). This increased presence has been manifested through the establishment of two new production lines in India (a BOPP film (non-subject merchandise) line, which began production on March 18, 2003, and a PET film line, which began production on February 28, 2004), as well as Jindal's November 26, 2003, acquisition of Rexor, a subsidiary company in France that coats and metalizes PET film.

According to Jindal, its name change has not been accompanied by any change to its legal or corporate structure, or ownership. Jindal stated that the name change was not part of an agreement made with Rexor. Moreover, Jindal reported that the expansion of its production lines has not caused it to change suppliers of the inputs used in the production of PET film nor has it resulted in changes to its relationships or contracts with suppliers. Further, Jindal claimed that its increased production capacity (which did not result in the production of new types of PET film) has had little impact on its customer base. Although there have been some changes in Jindal's U.S. customer base during the time period that it added the new PET film production line, Jindal noted that the total number of its U.S. customers has remained the same. Also, apart from acquiring a few new home market customers, Jindal reported that there have not been any significant changes to its Indian customer base. With respect to The Economic Times report that Jindal plans to market its value-added polyester products in the United States under the Rexor name (see Petitioners' August 25, 2004, letter at Exhibit 3), Jindal noted that these value-added products are not subject merchandise.

Further, Jindal contended that the name change did not result in any changes in the functions, authorities, duties, or responsibilities of any of its officers, executive board, or Board of Directors. The changes to the Board of Directors that occurred were, according to Jindal, in the ordinary course of business and unrelated to the name change. Thus, Jindal contends that, other than the new production line set up in Nashik India, there were no changes to its operations that produced or sold subject merchandise.3

The Department finds that, with respect to the production and sale of subject merchandise, the operations of Jindal Poly Films Limited are essentially the same as those of Jindal Polyester Limited.4 Jindal's 2003-2004 Annual Start Printed Page 20865Report notes that the company's name change is meant to reflect its recent expansion in the film business, specifically mentioning its acquisition of Rexor in France. See Jindal's December 6, 2004, questionnaire response at Exhibit N-3 (page 20 of Jindal Poly Films Limited's 2003-2004 Annual Report). However, we found no evidence of any material change in Jindal's management structure that was associated with the name change. We compared lists of Jindal's upper and lower level managers before and after the acquisition of Rexor and found the management to be substantially the same. See Jindal's January 7, 2005, questionnaire response at Exhibits 10 and 11. Furthermore, Jindal reported that the new production line at Nashik was managed by the same upper and lower level managers that ran its existing production line at Nashik. See Jindal's February 8, 2005, questionnaire response at 3. Additionally, the record indicates that there have been no changes in Jindal's supplier relationships and no significant changes to Jindal's customer base in the United States or India. Thus, despite the expansion that was associated with the name change (the new PET film production line at Nashik increased Jindal's production capacity by more than 60 percent), the Department finds that Jindal continued to essentially operate as it had prior to the addition of the new production line.

Further, we did not find any evidence that Jindal's acquisition of Rexor affected its operations with respect to the sale of subject merchandise to the United States. See the Memorandum to the File from Jeff Pedersen regarding Rexor's Impact on Jindal Poly Films Limited's Sales Operations, dated concurrently with this notice. Also, Rexor's descriptions of its product lines at its Web site (http://www.rexor.com/​) almost exclusively concern non-subject merchandise and the intended audience appears to be European customers. Thus, with respect to subject merchandise, the record does not indicate that Jindal's expansion of its film business has transformed its operations to such an extent that Jindal Poly Films Limited should not be viewed as a continuation of Jindal Polyester Limited for antidumping purposes.

Therefore, we preliminarily determine that Jindal Poly Films Limited is the successor-in-interest for purposes of antidumping duties to Jindal Polyester Limited and should receive the same antidumping duty rate as Jindal Polyester Limited. If these preliminary results are adopted in our final results of this changed circumstances review, we will instruct U.S. Customs and Border Protection to suspend shipments of subject merchandise made by Jindal Poly Films Limited, entered, or withdrawn from warehouse, for consumption on or after the date of publication of the final results of this changed circumstances review at Jindal Polyester Limited's cash deposit rate. See Granular Polytetrafluoroethylene Resin from Italy; Final Results of Antidumping Duty Changed Circumstances Review, 68 FR 25327 (May 12, 2003). This deposit rate shall remain in effect until publication of the final results of the next administrative review in which Jindal Poly Films Limited participates.

Public Comment

Any interested party may request a hearing within 10 days of publication of this notice. See 19 CFR 351.310(c). Any hearing, if requested, will be held 21 days after the date of publication of this notice, or the first working day thereafter. Interested parties may submit case briefs and/or written comments no later than 14 days after the date of publication of this notice. See 19 CFR 351.309(c)(ii). Rebuttal briefs and rebuttals to written comments, which must be limited to issues raised in such briefs or comments, may be filed no later than 19 days after the date of publication of this notice. See 19 CFR 351.309(d). Parties who submit arguments are requested to submit with the argument (1) a statement of the issue, (2) a brief summary of the argument, and (3) a table of authorities.

Consistent with 19 CFR 351.216(e), we will issue the final results of this changed circumstances review no later than 270 days after the date on which this review was initiated.

We are issuing and publishing this determination and notice in accordance with sections 751(b)(1) and 777(i)(1) of the Act and 19 CFR 351.216.

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Dated: April 15, 2005.

Joseph A. Spetrini,

Acting Assistant Secretary for Import Administration.

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Footnotes

1.  On June 29, 2004, Mr. S. Mittal, a non-executive Director, resigned from the Board of Directors and was replaced by Mr. J. Bansal (also a non-executive director). See Exhibit 1 of petitioners' August 25, 2004, letter.

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2.  Although these changes occurred both before and after the name change, we have considered the changes in our analysis.

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3.  Jindal did note, however, that, prior to the name change, it created two divisions in Nashik, for accounting purposes. See Jindal's December 7, 2004, questionnaire response at 2.

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4.  Consistent with Departmental practice, in reaching this determination, we focused our analysis on Jindal's operations that produced or sold merchandise within the scope of the antidumping duty order on PET film from India. See Industrial Phosphoric Acid From Israel; Final Results of Antidumping Duty Changed Circumstances Review, 59 FR 6944, 6945 (February 14, 1994) wherein the Department stated “that an inquiry into the validity of a claim of successorship to a respondent company should focus on that company's sales and production of the merchandise encompassed by the order.”

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[FR Doc. E5-1921 Filed 4-21-05; 8:45 am]

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