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Notice

Narrow Woven Ribbons with Woven Selvedge from Taiwan: Preliminary Determination of Sales at Less Than Fair Value and Postponement of Final Determination

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Start Preamble

AGENCY:

Import Administration, International Trade Administration, Department of Commerce.

EFFECTIVE DATE:

February 18, 2010.

SUMMARY:

The Department of Commerce (the Department) preliminarily determines that narrow woven ribbons with woven selvedge (narrow woven ribbons) from Taiwan are being, or are likely to be, sold in the United States at less than fair value (LTFV), as provided in section 733(b) of the Tariff Act of 1930, as amended (the Act). The estimated dumping margins are listed in the “Suspension of Liquidation” section of this notice. Interested parties are invited to comment on this preliminary determination.

Start Further Info

FOR FURTHER INFORMATION CONTACT:

Hector Rodriguez or Holly Phelps, AD/CVD Operations, Office 2, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, NW, Washington, DC 20230; telephone: (202) 482-0629 and (202) 482-0656, respectively.

End Further Info End Preamble Start Supplemental Information

SUPPLEMENTARY INFORMATION:

Background

Since the initiation of this investigation (see Narrow Woven Ribbons with Woven Selvedge from the Start Printed Page 7237People's Republic of China and Taiwan: Initiation of Antidumping Duty Investigations, 74 FR 39291 (Aug. 6, 2009) (Initiation Notice)), the following events have occurred.

On August 18, 2009, we received comments on the scope of the investigation from various importers of subject merchandise. Specifically, we received requests that the Department clarify the existing scope language to explicitly exclude formed rosettes and narrow woven ribbons affixed to non-subject merchandise for a functional purpose, both of which are covered by one of the scope exclusions. We also received two requests that the Department modify the existing scope to exclude two products that include merchandise which falls within the scope (i.e., de minimis amounts of narrow woven ribbons included within a kit or set and pre-cut, hand-finished narrow woven ribbons for retail packaging in lengths of 72 inches or less). For further discussion, see the “Scope Comments” section of this notice, below.

On August 24, 2009, the U.S. International Trade Commission (ITC) preliminarily determined that there is a reasonable indication that imports of narrow woven ribbons from Taiwan are materially injuring the U.S. industry, and on August 31, 2009, the ITC notified the Department of its findings. See Narrow Woven Ribbons with Woven Selvedge from China and Taiwan; Determinations, Investigation Nos. 701 TA 467 and 731 TA 1164-1165 (Preliminary), 74 FR 46224 (Sept. 8, 2009).

Also on August 31, 2009, we selected the following companies as the mandatory respondents in this investigation and issued antidumping duty questionnaires to them: Dear Year Brothers Mfg. Co., Ltd. (Dear Year), Roung Shu Industry Corporation (Roung Shu), and Shienq Huong Enterprise Co., Ltd. (Shienq Huong). See Memorandum from James Maeder, Office Director, to John M. Andersen, Acting Deputy Assistant Secretary, entitled, “Antidumping Duty Investigation of Narrow Woven Ribbons with Woven Selvedge from Taiwan: Selection of Respondents for Individual Review,” dated August 31, 2009 (Respondent Selection Memo). In the Respondent Selection Memo, we indicated that the Department intended to solicit information to determine if it is appropriate to “collapse” Shienq Huong with two affiliated exporters of subject merchandise, Hsien Chan Enterprise Co., Ltd. (Hsien Chan) and Novelty Handicrafts Co., Ltd. (Novelty), such that these three companies would be treated as a single entity.

In September 2009, we issued a supplemental questionnaire to Shienq Huong regarding the nature of its relationship with its affiliates, as well as the affiliates' involvement in the production and sale of narrow woven ribbons during the period of investigation (POI). Also in this month, each of the respondents notified the Department that it did not have a viable home market during the POI, and each provided information on its largest third country comparison markets. On September 21, the petitioner1 submitted comments regarding third country market selection with respect to Shienq Houng. On September 29 and 30, 2009, respectively, we issued supplemental questions to Shienq Houng and Roung Shu regarding their third country markets.

In September and October 2009, we received responses to section A of the antidumping duty questionnaire (i.e., the section covering general information about the company) from each of the respondents, and we issued them supplemental section A questionnaires. In these months, we also requested additional information from each respondent regarding its selling practices. We received the responses to the supplemental questionnaires covering section A and the questionnaires regarding each respondents' selling practices in September and October 2009.

In October 2009, we received Shienq Huong's response to the September supplemental questionnaire on affiliation. We issued an additional supplemental questionnaire on this topic, and received Shienq Huong's response, in this month.

Also in October 2009, we received responses to the market selection supplemental questionnaires from Shienq Houng and Roung Shu, as well as additional comments from the petitioner on this issue. Also in this month, we received responses to sections B (i.e., the section covering comparison market sales) and C (i.e., the section covering U.S. sales) of the antidumping duty questionnaire from each of the respondents.

On October 30, 2009, the petitioner made a timely request pursuant to section 733(c)(1)(A) of the Act and 19 CFR 351.205(e) for a 50-day postponement of the preliminary determination. Therefore, pursuant to section 733(c)(1)(A) of the Act, the Department postponed the preliminary determination of this investigation until February 4, 2010. See Narrow Woven Ribbons With Woven Selvedge From the People's Republic of China and Taiwan: Postponement of Preliminary Determinations of Antidumping Duty Investigations, 74 FR 59962 (Nov. 19, 2009).

In November 2009, we issued supplemental questionnaires related to sections B and C to each respondent.

Also in November 2009, the petitioner alleged that Dear Year, Roung Shu, and Shienq Houng made third country sales below the cost of production (COP) and, therefore, requested that the Department initiate a sales-below-cost investigation of these respondents. In December 2009, the Department initiated a sales-below-cost investigation for Dear Year, Roung Shu, and Shienq Houng. See the December 8, 2009, Memoranda to James Maeder, Director Office 2, from the Team entitled: “Antidumping Duty Investigation of Narrow Woven Ribbons with Woven Selvedge from Taiwan: The Petitioner's Allegation of Sales Below the Cost of Production for Dear Year Brothers Mfg. Co.” (Dear Year Cost Allegation Memo), “Antidumping Duty Investigation of Narrow Woven Ribbons with Woven Selvedge from Taiwan: The Petitioner's Allegation of Sales Below the Cost of Production for Roung Shu Industry Corporation” (Roung Shu Cost Allegation Memo), and “Antidumping Duty Investigation of Narrow Woven Ribbons with Woven Selvedge from Taiwan: The Petitioner's Allegation of Sales Below the Cost of Production for Shienq Huong Enterprise Co., Ltd.” (Shienq Huong Cost Allegation Memo). On that same date, we instructed Dear Year, Roung Shu, and Shienq Houng to respond to section D (i.e., the section covering COP and constructed value (CV)) of the questionnaire.

In December 2009, we received responses to our sections B and C supplemental questionnaires from Dear Year, Roung Shu, and Shienq Houng. We also issued additional supplemental questions to Dear Year and Shienq Houng regarding their manufacturing processes, as well as their purchases of ribbons from unaffiliated suppliers.

Also in December 2009, we received comments from the petitioner (including revised scope language) on the two scope clarification, as well as the two scope exclusion, requests submitted in August 2009. For further discussion, see the “Scope Comments” section below.

On December 29, 2009 and January 14, 2010, Roung Shu and Shienq Huong, respectively, requested that in the event of an affirmative preliminary Start Printed Page 7238determination in this investigation, the Department: 1) postpone its final determination by 60 days in accordance with 735(a)(2)(A) of the Act and 19 CFR 351.210(b)(2)(ii); and 2) extend the application of the provisional measures prescribed under 19 CFR 351.210(e)(2) from a four-month period to a six-month period. For further discussion, see the “Postponement of Final Determination and Extension of Provisional Measures” section of this notice, below.

In January 2010, we determined that it is appropriate to “collapse” Shienq Huong with its two affiliates, Hsien Chan and Novelty. See Memorandum to James Maeder, Director, Office 2, AD/CVD Operations, from the Team entitled, “Whether to Collapse Shieng Houng Enterprise Co., Hsien Chan Enterprise Co., and Novelty Handicrafts Co., Ltd. in the Antidumping Duty Investigation of Narrow Woven Ribbons with Woven Selvedge from Taiwan,” dated January 8, 2010 (Collapsing Memo). In addition, we determined that Roung Shu and Shienq Huong correctly reported sales to Mexico, and Dear Year correctly reported sales to Canada, as the basis for normal value. See Memorandum to James Maeder, Director, Office 2, AD/CVD Operations, from the Team entitled, “Antidumping Duty Investigation of Narrow Woven Ribbons with Woven Selvedge from Taiwan - Selection of the Appropriate Third Country Markets,” dated January 13, 2010 (Market Selection Memo); see also the “Home Market Viability and Selection of Comparison Markets” section of this notice, below, for further discussion. In this month, Shienq Huong submitted a letter permitting the Department to treat the names of its affiliates, Hsien Chan and Novelty, as public information for the remainder of this proceeding.

Also in January 2010, we received responses to section D of the antidumping duty questionnaire from each of the respondents. We issued supplemental questionnaires regarding section D of the questionnaire during this month, as well additional supplemental questionnaires regarding each respondent's sales. The responses to the Department's additional sales supplemental questionnaires for each respondent were received in January 2010. However, because the responses to the Department's section D supplemental questionnaires were not received before the date of the preliminary determination, we are unable to consider them in our preliminary determination. We will consider this information in our final determination.

Also in January 2010, we received additional comments from Essential Ribbons, Inc., responding to the petitioner's December 2009 scope comments, as well as additional comments from the petitioner regarding the scope of this investigation. For further discussion, see the “Scope Comments” section below.

Finally in January 2010, we received a request from the petitioner that the Department collect cost data from the unaffiliated suppliers of narrow woven ribbons purchased by each of the respondents. For further discussion, see the “Cost of Production Analysis” section of this notice, below. In this same month, Shienq Huong responded to the petitioner's request to collect additional cost data.

In February 2010, Dear Year requested that in the event of an affirmative preliminary determination in this investigation, the Department: 1) postpone its final determination by 60 days in accordance with 735(a)(2)(A) of the Act and 19 CFR 351.210(b)(2)(ii); and 2) extend the application of the provisional measures prescribed under 19 CFR 351.210(e)(2) from a four-month period to a six-month period. For further discussion, see the “Postponement of Final Determination and Extension of Provisional Measures” section of this notice, below. On the same date, Dear Year also responded to the petitioner's January 2010 request to collect additional cost data.

Finally, in February 2010 we issued a final supplemental sales questionnaire to each of the respondents. In addition, we requested cost information from one of Dear Year's and two of Shienq Huong's unaffiliated suppliers of purchased ribbon. This information is due in March 2010. For further discussion, see the “Cost of Production Analysis” section of this notice, below.

Period of Investigation

The POI is July 1, 2008, to June 30, 2009. This period corresponds to the four most recent fiscal quarters prior to the month of the filing of the petition. See 19 CFR 351.204(b)(1).

Postponement of Final Determination and Extension of Provisional Measures

Section 735(a)(2) of the Act provides that a final determination may be postponed until not later than 135 days after the date of the publication of the preliminary determination if, in the event of an affirmative preliminary determination, a request for such postponement is made by exporters, who account for a significant proportion of exports of the subject merchandise, or in the event of a negative preliminary determination, a request for such postponement is made by the petitioner. The Department's regulations, at 19 CFR 351.210(e)(2), require that requests by respondents for postponement of a final determination be accompanied by a request for extension of provisional measures from a four-month period to not more than six months.

On December 29, 2009, January 14, 2010, and February 1, 2010, Roung Shu, Shienq Huong, and Dear Year, respectively, requested that in the event of an affirmative preliminary determination in this investigation, the Department postpone its final determination by 60 days. At the same time, Roung Shu, Shienq Huong, and Dear Year requested that the Department extend the application of the provisional measures prescribed under section 733(d) of the Act and 19 CFR 351.210(e)(2), from a four-month period to a six-month period. In accordance with section 735(a)(2) of the Act and 19 CFR 351.210(b)(2), because (1) our preliminary determination is affirmative, (2) the requesting exporters account for a significant proportion of exports of the subject merchandise, and (3) no compelling reasons for denial exist, we are granting this request and are postponing the final determination until no later than 135 days after the publication of this notice in the Federal Register. Suspension of liquidation will be extended accordingly.

Scope of Investigation

The merchandise subject to the investigation is narrow woven ribbons with woven selvedge, in any length, but with a width (measured at the narrowest span of the ribbon) less than or equal to 12 centimeters, composed of, in whole or in part, man-made fibers (whether artificial or synthetic, including but not limited to nylon, polyester, rayon, polypropylene, and polyethylene teraphthalate), metal threads and/or metalized yarns, or any combination thereof. Narrow woven ribbons subject to the investigation may:

  • also include natural or other non-man-made fibers;
  • be of any color, style, pattern, or weave construction, including but not limited to single-faced satin, double-faced satin, grosgrain, sheer, taffeta, twill, jacquard, or a combination of two or more colors, styles, patterns, and/or weave constructions;
  • have been subjected to, or composed of materials that have been subjected to, various treatments, including but not limited to dyeing, printing, foil stamping, embossing, flocking, coating, and/or sizing; Start Printed Page 7239
  • have embellishments, including but not limited to appliqué, fringes, embroidery, buttons, glitter, sequins, laminates, and/or adhesive backing;
  • have wire and/or monofilament in, on, or along the longitudinal edges of the ribbon;
  • have ends of any shape or dimension, including but not limited to straight ends that are perpendicular to the longitudinal edges of the ribbon, tapered ends, flared ends or shaped ends, and the ends of such woven ribbons may or may not be hemmed;
  • have longitudinal edges that are straight or of any shape, and the longitudinal edges of such woven ribbon may or may not be parallel to each other;
  • consist of such ribbons affixed to like ribbon and/or cut-edge woven ribbon, a configuration also known as an “ornamental trimming;”
  • be wound on spools; attached to a card; hanked (i.e., coiled or bundled); packaged in boxes, trays or bags; or configured as skeins, balls, bateaus or folds; and/or
  • be included within a kit or set such as when packaged with other products, including but not limited to gift bags, gift boxes and/or other types of ribbon.

Narrow woven ribbons subject to the investigation include all narrow woven fabrics, tapes, and labels that fall within this written description of the scope of this investigation.

Excluded from the scope of the investigation are the following:

(1) formed bows composed of narrow woven ribbons with woven selvedge;

(2) “pull-bows” (i.e., an assemblage of ribbons connected to one another, folded flat and equipped with a means to form such ribbons into the shape of a bow by pulling on a length of material affixed to such assemblage) composed of narrow woven ribbons;

(3) narrow woven ribbons comprised at least 20 percent by weight of elastomeric yarn (i.e., filament yarn, including monofilament, of synthetic textile material, other than textured yarn, which does not break on being extended to three times its original length and which returns, after being extended to twice its original length, within a period of five minutes, to a length not greater than one and a half times its original length as defined in the Harmonized Tariff Schedule of the United States (HTSUS), Section XI, Note 13) or rubber thread;

(4) narrow woven ribbons of a kind used for the manufacture of typewriter or printer ribbons;

(5) narrow woven labels and apparel tapes, cut-to-length or cut-to-shape, having a length (when measured across the longest edge-to-edge span) not exceeding 8 centimeters;

(6) narrow woven ribbons with woven selvedge attached to and forming the handle of a gift bag;

(7) cut-edge narrow woven ribbons formed by cutting broad woven fabric into strips of ribbon, with or without treatments to prevent the longitudinal edges of the ribbon from fraying (such as by merrowing, lamination, sono-bonding, fusing, gumming or waxing), and with or without wire running lengthwise along the longitudinal edges of the ribbon;

(8) narrow woven ribbons comprised at least 85 percent by weight of threads having a denier of 225 or higher;

(9) narrow woven ribbons constructed from pile fabrics (i.e., fabrics with a surface effect formed by tufts or loops of yarn that stand up from the body of the fabric) ;

(10) narrow woven ribbon affixed (including by tying) as a decorative detail to non-subject merchandise, such as a gift bag, gift box, gift tin, greeting card or plush toy, or affixed (including by tying) as a decorative detail to packaging containing non-subject merchandise;

(11) narrow woven ribbon that is (a) affixed to non-subject merchandise as a working component of such non-subject merchandise, such as where narrow woven ribbon comprises an apparel trimming, book marker, bag cinch, or part of an identity card holder, or (b) affixed (including by tying) to non-subject merchandise as a working component that holds or packages such non-subject merchandise or attaches packaging or labeling to such non-subject merchandise, such as a “belly band” around a pair of pajamas, a pair of socks or a blanket; and

(12) narrow woven ribbon(s) comprising a belt attached to and imported with an item of wearing apparel, whether or not such belt is removable from such item of wearing apparel.

The merchandise subject to this investigation is classifiable under the HTSUS statistical categories 5806.32.1020; 5806.32.1030; 5806.32.1050 and 5806.32.1060. Subject merchandise also may enter under subheadings 5806.31.00; 5806.32.20; 5806.39.20; 5806.39.30; 5808.90.00; 5810.91.00; 5810.99.90; 5903.90.10; 5903.90.25; 5907.00.60; and 5907.00.80 and under statistical categories 5806.32.1080; 5810.92.9080; 5903.90.3090; and 6307.90.9889. The HTSUS statistical categories and subheadings are provided for convenience and customs purposes; however, the written description of the merchandise under investigation is dispositive.

Scope Comments

In accordance with the preamble to the Department's regulations (see Antidumping Duties; Countervailing Duties, 62 FR 27296, 27323 (May 19, 1997)), in our Initiation Notice we set aside a period of time for parties to raise issues regarding product coverage, and encouraged all parties to submit comments within 20 calendar days of publication of the Initiation Notice.

On August 18, 2009, we received timely comments on the scope of the investigation from the following interested parties: 1) Costco Wholesale, Hobby Lobby Stores, Inc., Jo-Ann Stores, Inc., Michael Stores, Inc., and Target Corporation (collectively, the “Ribbons Retailers”); 2) Papillon Ribbon and Bow, Inc. (Papillon); and 3) Essential Ribbons, Inc. (Essential Ribbons). Specifically, we received two requests that the Department modify the scope to clarify that certain products are outside the scope, and two additional requests that the Department narrow the scope to exclude two products that include merchandise which falls within the scope. These requests are as follows:

1) The Ribbons Retailers requested that the Department modify exclusions 10 (i.e., narrow woven ribbons affixed as a decorative detail to non-subject merchandise) and 11 (i.e., narrow woven ribbons affixed to non-subject merchandise as a working component) to clarify that narrow woven ribbons affixed to non-subject merchandise for a functional purpose (such as “belly bands” around a pair of pajamas and stationery packaged together by means of a ribbon) is excluded from the scope;

2) Papillon requested that the Department modify the scope to explicitly exclude formed rosettes, which Papillon argued is a subset of exclusions 1 (i.e., formed bows) and 11;

3) The Ribbons Retailers requested that the Department narrow the scope to exclude narrow woven ribbons included within a kit or set in de minimis amounts (such as narrow woven ribbons in holiday ornament sets, which are of small, pre-cut lengths and are used to tie ornaments to a tree); and

4) Essential Ribbons requested that the Department narrow the scope to exclude pre-cut, hand-finished narrow woven ribbons for retail Start Printed Page 7240packaging in lengths of 72 inches or less.

On December 22, 2009, and January 29, 2010, the petitioner submitted comments on each of the above scope requests. Specifically, the petitioner agreed in concept with both requests made by the Ribbons Retailers (i.e., items one and three, above), although the petitioner disagreed with the Ribbons Retailers' request to modify exclusion 10. Moreover, while the petitioner also agreed with Papillon that rosettes are not covered by the scope of the investigation (i.e., item two, above), it contended that the existing language of the scope at exclusions 1 and 11 is sufficiently clear on this point, given that rosettes are bows. Finally, the petitioner opposed Essential Ribbon's request that the Department narrow the scope to exclude pre-cut, hand-finished ribbon (i.e., item four, above) because the petitioner intended that such ribbon fall within the scope. Regarding this latter item, the petitioner asserts that it has in the past produced this product and may well produce it in the future, as it requires only a very minor finishing operation to cut and seal the ends of the ribbon. Further, the petitioner notes that it currently sells narrow woven ribbons in similar lengths (i.e., of three feet or less), and it prices these products in the same manner.

On January 19, 2010, Essential Ribbons submitted comments opposing the petitioner's assertion that it wishes to have pre-cut, hand-finished ribbon (i.e., item four, above) covered by the scope of this investigation. Essential Ribbons asserts that the petitioner does not currently produce this product and thus it should be excluded from the scope of this investigation.

We have carefully considered each of the requests noted above, as well as the petitioner's responsive comments. While the Department does have the authority to define or clarify the scope of an investigation, the Department must exercise this authority in a manner which reflects the intent of the petition and the Department generally should not use its authority to define the scope of an investigation in a manner that would thwart the statutory mandate to provide the relief requested in the petition. See Notice of Final Determination of Sales at Less Than Fair Value: Certain Softwood Lumber Products From Canada, 67 FR 15539 (April 2, 2002), and accompanying Issues and Decision Memorandum under Scope Issues (after Comment 49). Thus, absent an overarching reason to modify the scope in the petition, the Department accepts it. Id. See also Circular Welded Austenitic Stainless Pressure Pipe from the People's Republic of China: Preliminary Determination of Sales at Less Than Fair Value and Postponement of Final Determination, 73 FR 51788, 51789 (Sept., 5 2008); Notice of Final Determination of Sales at Not Less Than Fair Value: Pure Magnesium from the Russian Federation, 66 FR 49347 (Sept. 27, 2001), and accompanying Issues and Decision Memorandum at Comment 12; and Mitsubishi Heavy Industries, Ltd. v. U.S., 986 F. Supp. 1428 (CIT 1997).

In this case, the petitioner has no objection to modifying the scope with respect to items one and three described above (i.e., narrow woven ribbons affixed to non-subject merchandise for a functional purpose and narrow woven ribbons included in kits or sets in de minimis amounts). Accordingly, we have modified the scope to incorporate the petitioner's revised language with respect to item one because this modification is consistent with the intent of the petition. See the “Scope of the Investigation” section above. However, regarding item number three, we have concerns over whether the proposed scope exclusion would be administrable. Therefore, we have not modified the scope to exclude narrow woven ribbons included in kits or sets in “de minimis” amounts, as described by the petitioner, for purposes of the preliminary determination. We intend to work with the Ribbons Retailers and the petitioner to determine whether this exclusion could be administrable and will consider modifying the scope for purposes of the final determination.

Regarding item two (i.e., rosettes), the petitioner also agrees that this product is excluded. However, we have not modified the scope language with respect to rosettes because we find that the scope is sufficiently clear that rosettes are not covered by this investigation, and, thus, no modification is necessary. Finally, we have made no change to the scope with respect to item four (i.e., pre-cut, hand-finished ribbons) because: 1) these products are clearly within the scope; and 2) the petitioner intended that these products be covered.

Fair Value Comparisons

To determine whether sales of narrow woven ribbons from Taiwan to the United States were made at LTFV, we compared the export price (EP) to the normal value (NV), as described in the “Export Price” and “Normal Value” sections of this notice, below. In accordance with section 777A(d)(1)(A)(i) of the Act, we compared POI weighted-average EPs to weighted-average NVs.

For this preliminary determination, we have determined that none of the respondents had a viable home market during the POI. Therefore, as the basis for NV, we used third country sales to Canada for Dear Year, and Mexico for Roung Shu and Shienq Huong, when making comparisons in accordance with section 773(a)(1)(C) of the Act. For further discussion, see the Market Selection Memo.

Product Comparisons

In accordance with section 771(16) of the Act, we considered all products produced by the same manufacturer and sold by Dear Year in Canada, and Roung Shu and Shienq Huong in Mexico, during the POI that fit the description in the “Scope of Investigation” section of this notice to be foreign like products for purposes of determining appropriate product comparisons to U.S. sales. We compared U.S. sales to sales made in the third country, where appropriate. Where there were no sales of identical merchandise in the third country made in the ordinary course of trade and produced by the same manufacturer to compare to U.S. sales, we compared U.S. sales to sales of the most similar foreign like product, or CV.

In making the product comparisons, we matched foreign like products based on the physical characteristics reported by the respondents in the following order of importance: width, type, number of ends in the warp, number of weft picks, spool capacity, yarn composition, metal percentage, selvedge construction, dye process, surface finish, embellishments, dyed color, pattern type, selvedge contour, product unit packaging, and treatments. In addition, we confined our product comparisons to products produced by the same manufacturer. See the “Cost of Production Analysis” section, below, for further discussion.

In certain instances, the respondents reported the physical characteristics at a greater level of detail than that requested in the questionnaire. Where appropriate, we reclassified these physical characteristics using the categories listed in the questionnaire.

Finally, Dear Year reported that some of its sales were made in either lengths of: 1) less than one yard; or 2) feet which did not equal whole yards. We note that we have required all respondents to report the spool capacities of their products in whole yards and thus have accepted Dear Year's reported spool capacities for purposes of the preliminary determination. The Department invites interested parties to submit comments in their case briefs on whether the Start Printed Page 7241Department should revise its reporting requirements for the spool capacity product characteristic.

Export Price

We used EP methodology for each respondent, in accordance with section 772(a) of the Act, because the subject merchandise was sold to the first unaffiliated purchaser in the United States prior to importation by the exporter or producer outside the United States and constructed export price (CEP) methodology was not otherwise warranted based on the facts on the record.

A. Dear Year

We based EP on the packed price to an unaffiliated purchaser in the United States. Where appropriate, we made adjustments for handling fees charged to the customer, price adjustments tied to exchange rates, and relabeling fees. We capped relabeling revenue by the amount of packing expenses incurred, in accordance with our practice. See Certain Orange Juice from Brazil: Final Results of Antidumping Duty Administrative Review, 74 FR 40167 (Aug. 11, 2009), and accompanying Issues and Decision Memorandum at Comment 3.

We made deductions for movement expenses in accordance with section 772(c)(2)(A) of the Act; these included, where appropriate, foreign inland freight and foreign brokerage and handling expenses.

B. Roung Shu

We based EP on the packed price to an unaffiliated purchaser in the United States. Where appropriate, we made adjustments for post-invoice price markdowns and rebates (including both volume rebates and certain post-sale price adjustments classified by Roung Shu as discounts). We made deductions for movement expenses in accordance with section 772(c)(2)(A) of the Act; these included, where appropriate, foreign inland freight and foreign brokerage and handling expenses.

C. Shienq Huong

We based EP on the packed price to an unaffiliated purchaser in the United States. Where appropriate, we made adjustments for billing adjustments. We made deductions for movement expenses in accordance with section 772(c)(2)(A) of the Act; these included, where appropriate, foreign inland freight and foreign brokerage and handling expenses.

Normal Value

A. Home Market Viability and Comparison-Market Selection

To determine whether there is a sufficient volume of sales in the home market to serve as a viable basis for calculating NV (i.e., the aggregate volume of home market sales of the foreign like product is equal to or greater than five percent of the aggregate volume of U.S. sales), we compared each respondent's volume of home market sales of the foreign like product to its volume of U.S. sales of the subject merchandise. See section 773(a)(1)(C) of the Act.

Based on this comparison, we determined that each respondent's aggregate volume of home market sales of the foreign like product was insufficient to permit a proper comparison with U.S. sales of the subject merchandise. We used sales to each respondent's largest third country market as the basis for comparison-market sales in accordance with section 773(a)(1)(C) of the Act and 19 CFR 351.404, as no other comparison market(s) offered grea ter product similiarity. As discussed above, we used Canada for Dear Year, and Mexico for Roung Shu and Shienq Houng. For further discussion, see the Market Selection Memo.

B. Level of Trade

In accordance with section 773(a)(1)(B) of the Act, to the extent practicable, we determine NV based on sales in the comparison market at the same level of trade (LOT) as the EP. Pursuant to 19 CFR 351.412(c)(1), the NV LOT is that of the starting-price sales in the comparison market or, when NV is based on CV, that of the sales from which we derive selling, general, and administrative (SG&A) expenses and profit. For EP, the U.S. LOT is also the level of the starting-price sale, which is usually from exporter to importer.

To determine whether NV sales are at a different LOT than EP sales, we examine stages in the marketing process and selling functions along the chain of distribution between the producer and the unaffiliated customer. See 19 CFR 351.412(c)(2). If the comparison-market sales are at a different LOT, and the difference affects price comparability, as manifested in a pattern of consistent price differences between the sales on which NV is based and comparison market sales at the LOT of the export transaction, we make an LOT adjustment under section 773(a)(7)(A) of the Act.

In this investigation, we obtained information from each respondent regarding the marketing stages involved in making the reported third country and U.S. sales, including a description of the selling activities performed by each respondent for each channel of distribution. We analyzed this data and found that each respondent made direct sales to distributors and/or retailers in both the U.S. and comparison markets. According to the information in their questionnaire responses, these respondents perform essentially the same selling functions in the United States and the relevant third country market (i.e., for Dear Year, strategic/economic planning, inventory maintenance, provision of guarantees, and packing; for Roung Shu, color trend advice, provision of rebates, provision of warranties and guarantees, provision of samples, and packing; and for Shienq Huong, inventory maintenance, freight and delivery arrangements, and packing). Therefore, we find that, for each respondent, the sales channels in each market are at the same LOT. Accordingly, all comparisons are at the same LOT for Dear Year, Roung Shu, and Shienq Huong and an adjustment pursuant to section 773(a)(7)(A) of the Act is not warranted.

C. Cost of Production Analysis

Based on our analysis of the petitioner's allegations, we found that there were reasonable grounds to believe or suspect that Dear Year's, Roung Shu's, and Shienq Huong's sales of narrow woven ribbons in their third country markets were made at prices below their COP. Accordingly, pursuant to section 773(b) of the Act, we initiated sales-below-cost investigations to determine whether the respondents' sales were made at prices below their respective COPs. See the Dear Year Cost Allegation Memo, the Roung Shu Cost Allegation Memo, and the Shieng Huong Cost Allegation Memo, for further discussion.

In their sections A and D questionnaire responses, the respondents reported that they subcontracted the production of some or all of the narrow woven ribbons manufactured during the POI using unaffiliated suppliers. Moreover, both Dear Year and Shienq Huong also reported that they purchased undyed (or “greige”) ribbon from unaffiliated companies, which they then further processed (e.g., dyed, leveled, and/or printed) into the finished products sold in the United States and their comparison markets. Finally, Dear Year reported that it purchased piece-dyed narrow woven ribbons from unaffiliated Start Printed Page 7242suppliers which it cut into final lengths and packed in individual spools before sale. In each of these instances, the respondents claimed that they were the manufacturers of the narrow woven ribbons, arguing that the value added during their own production operations was significant.

On January 26, 2010, the petitioner submitted comments on this topic, in which it argued that the unaffiliated suppliers of the purchased ribbon are the manufacturers and thus should be required to submit cost data in this proceeding. After analyzing the data on the record, we preliminarily determine that the company which weaves the ribbon is the manufacturer because the essential characteristics of the ribbon are established at this stage and because the foreign exporter/producer that further processes the ribbon does not control and direct the production of the basic ribbon which it then further processes. In accordance with our past practice, we are collecting cost data from certain of these unaffiliated suppliers. See, e.g., Ball Bearings and Parts Thereof From France, Germany, Italy, Japan, and the United Kingdom: Final Results of Antidumping Duty Administrative Reviews and Rescission of Reviews in Part, 73 FR 52823 (Sept. 11, 2008), and accompanying Issues and Decision Memorandum at Comment 15; and SKF USA Inc. v. United States, Ct. No. 08-322 (Slip Op. 09-148) (CIT 2009). However, because we currently do not have cost information for the unaffiliated weavers, as facts available, we are determining COP based on acquisition prices for purchased ribbon for purposes of the preliminary determination.

Section 776(a) of the Act provides that the Department shall apply “facts otherwise available” if (1) necessary information is not on the record, or (2) an interested party or any other person (A) withholds information that has been requested, (B) fails to provide information within the deadlines established, or in the form and manner requested by the Department, subject to subsections (c)(1) and (e) of section 782 of the Act, (C) significantly impedes a proceeding, or (D) provides information that cannot be verified as provided by section 782(i) of the Act. Here, we lack information necessary to determine the unaffiliated suppliers' actual costs and must, therefore, rely upon facts available. The acquisition prices for purchased ribbon constitute reasonable facts available because they are product-specific and the only data available on the record at this time with respect to purchased ribbon.

We plan to examine the issue of whether the weaver is the producer further at our verifications of Dear Year, Roung Shu, and Shienq Huong and we will reconsider this issue for the final determination, if necessary.

1. Calculation of COP

In accordance with section 773(b)(3) of the Act, we calculated COP based on the sum of the cost of materials and fabrication for the foreign like product, plus an amount for general and administrative expenses (G&A), interest expenses, and third country packing costs. See “Test of Third Country Sales Prices” section below for treatment of third country selling expenses. We relied on the COP data submitted by the respondents except, for Dear Year and Roung Shu, we revised the G&A and financial expense ratios to exclude packing expenses from the cost of sales denominator. See the February 4, 2010, Memoranda from Heidi Schriefer, Senior Accountant, to Neal M. Halper, Director, Office of Accounting, entitled, “Cost of Production and Constructed Value Calculation Adjustments for the Preliminary Determination - Dear Year Manufacturing Co., Ltd.,” and Kristin Case, Accountant, to Neal M. Halper, Director, Office of Accounting, entitled, “Cost of Production and Constructed Value Calculation Adjustments for the Preliminary Determination - Roung Shu Industry Corporation,” for further discussion.

2. Test of Third Country Sales Prices

On a product-specific basis, we compared the adjusted weighted-average COP to the third country sales of the foreign like product, as required under section 773(b) of the Act, in order to determine whether the sale prices were below the COP. The prices were exclusive of any applicable billing adjustments, discounts, rebates, movement charges, and direct and indirect selling expenses. In determining whether to disregard third country market sales made at prices less than their COP, we examined, in accordance with sections 773(b)(1)(A) and (B) of the Act, whether such sales were made (1) within an extended period of time in substantial quantities, and (2) at prices which permitted the recovery of all costs within a reasonable period of time.

3. Results of the COP Test

Pursuant to section 773(b)(2)(C) of the Act, where less than 20 percent of the respondent's sales of a given product during the POI are at prices less than the COP, we do not disregard any below-cost sales of that product, because we determine that in such instances the below-cost sales were not made in substantial quantities. Where 20 percent or more of the respondent's sales of a given product during the POI are at prices less than the COP, we determine that the below-cost sales represent substantial quantities within an extended period of time, in accordance with section 773(b)(1)(A) of the Act. In such cases, we also determine whether such sales were made at prices which would not permit recovery of all costs within a reasonable period of time, in accordance with section 773(b)(1)(B) of the Act.

We found that, for certain specific products, more than 20 percent of Dear Year's, Roung Shu's, and Shienq Huong's third country sales during the POI were at prices less than the COP and, in addition, the below-cost sales did not provide for the recovery of costs within a reasonable period of time. We therefore excluded these sales and used the remaining sales, if any, as the basis for determining NV, in accordance with section 773(b)(1) of the Act. Where there were no sales of any comparable product at prices above the COP, we used CV as the basis for determining NV.

4. Calculation of Normal Value Based on Comparison Market Prices

a. Dear Year

For Dear Year, we calculated NV based on delivered prices to unaffiliated customers. Where appropriate, we made adjustments for discounts. We made deductions for movement expenses, including foreign inland freight expenses and foreign brokerage and handling expenses.

We made adjustments under section 773(a)(6)(C)(iii) of the Act and 19 CFR 351.410 for differences in circumstances of sale for credit expenses, display unit costs, warranty expenses, and bank charges. We recalculated Dear Year's U.S. warranty expenses to base them on Dear Year's historical experience. See Memorandum from Holly Phelps to the file entitled, “Calculations Performed for Dear Year Brothers Mfg. Co., Ltd. for the Preliminary Results in the 08-09 Antidumping Duty Investigation of Narrow Woven Ribbon with Woven Selvedge from Taiwan,” dated February 4, 2010, for further discussion.

Regarding display unit costs, Dear Year reported that it sold certain narrow woven ribbons in combinations in displays with other products. However, it did not report the cost of the display units for all products sold in this fashion in its U.S. sales listing. Therefore, we have based the cost of Start Printed Page 7243these displays on the average cost of display units reported in the U.S. sales listing, as facts available. We have afforded Dear Year an opportunity to provide the missing data, and we will consider this information for purposes of the final determination.

We made no adjustment to NV for testing fees incurred by Dear Year because we determined that these expenses were more appropriately classified as indirect selling expenses, in accordance with the Department's practice. See, e.g., Honey from Argentina: Final Results of Antidumping Duty Administrative Review and Determination to Revoke Order in Part, 74 FR 32107 (July 7, 2009), and accompanying Issues and Decision Memorandum at Comment 5.

We made adjustments for differences in costs attributable to differences in the physical characteristics of the merchandise in accordance with section 773(a)(6)(C)(ii) of the Act and 19 CFR 351.411. We also deducted third country packing costs and added U.S. packing costs in accordance with sections 773(a)(6)(A) and (B) of the Act.

b. Roung Shu

For Roung Shu, we calculated NV based on delivered prices to unaffiliated customers. Where appropriate, we made adjustments for post-invoice price markdowns and rebates (including both volume rebates and certain post-sale price adjustments classified by Roung Shu as discounts). We made no adjustment to NV for the cost of contributions made by Roung Shu toward the opening on new retail outlets by one of the company's customers, because we determined that these expenses were more appropriately classified as indirect selling expenses.

We made deductions for movement expenses, including foreign inland freight expenses, foreign brokerage and handling expenses, international freight expenses, and marine insurance. In addition, we made adjustments under section 773(a)(6)(C)(iii) of the Act and 19 CFR 351.410 for differences in circumstances of sale for credit expenses, the cost of display units, advertising expenses, U.S. warranty expenses, and bank charges. We recalculated Roung Shu's third country and U.S. credit expenses to use the simple average of the POI U.S. Federal Reserve interest rates, as well as to base the expense on gross unit price. See Memorandum from Miriam Eqab to the file entitled, “Calculations Performed for Roung Shu Industry Corporation (Roung Shu) for the Preliminary Results in the 08-09 Antidumping Duty Investigation of Narrow Woven Ribbon with Woven Selvedge from Taiwan,” dated February 4, 2010, for further discussion. In addition, we denied Roung Shu's claim for third country warranty expenses because the company's response contained conflicting information related to this adjustment, and thus we preliminarily found that it was not adequately supported. Nonetheless, we intend to request additional information from Roung Shu related to its third country warranties and will consider this information for purposes of the final determination.

We made adjustments for differences in costs attributable to differences in the physical characteristics of the merchandise in accordance with section 773(a)(6)(C)(ii) of the Act and 19 CFR 351.411. We also deducted third country packing costs and added U.S. packing costs in accordance with sections 773(a)(6)(A) and (B) of the Act.

c. Shienq Huong

For Shienq Huong, we calculated NV based on delivered prices to unaffiliated customers. We made deductions for movement expenses, including foreign inland freight expenses and foreign brokerage and handling expenses. In addition, we made adjustments under section 773(a)(6)(C)(iii) of the Act and 19 CFR 351.410 for differences in circumstances of sale for credit expenses, the cost of display units, U.S. warranty expenses, and bank charges. We recalculated Shienq Huong's third country and U.S. credit expenses for sales denominated in U.S. dollars to use the simple average of the POI U.S. Federal Reserve interest rates. We also recalculated Shienq Huong's U.S. warranty expenses to base them on Shienq Huong's historical experience. See Memorandum from Hector Rodriguez to the file entitled, “Calculations Performed for Shienq Huong Enterprise Co., Ltd. (Shieng Huong) for the Preliminary Determination in the Antidumping Duty Investigation of Narrow Woven Ribbons with Woven Selvedge from Taiwan,” dated February 4, 2010, for further discussion.

We made adjustments for differences in costs attributable to differences in the physical characteristics of the merchandise in accordance with section 773(a)(6)(C)(ii) of the Act and 19 CFR 351.411. We also deducted third country packing costs and added U.S. packing costs in accordance with sections 773(a)(6)(A) and (B) of the Act.

5. Calculation of Normal Value Based on Constructed Value

Section 773(a)(4) of the Act provides that, where NV cannot be based on comparison market sales, NV may be based on CV. Accordingly, for those narrow woven ribbons for which we could not determine the NV based on comparison market sales, we based NV on CV.

Section 773(e) of the Act provides that CV shall be based on the sum of the cost of materials and fabrication for the imported merchandise, plus amounts for SG&A expenses, profit, and U.S. packing costs. For each respondent, we calculated the cost of materials and fabrication based on the methodology described in the “Cost of Production Analysis” section, above. We based SG&A and profit for each respondent on the actual amounts incurred and realized by it in connection with the production and sale of the foreign like product in the ordinary course of trade for consumption in the comparison market, in accordance with section 773(e)(2)(A) of the Act.

We made adjustments to CV for differences in circumstances of sale in accordance with section 773(a)(6)(iii) and (a)(8) of the Act and 19 CFR 351.410. For comparisons to EP, we made circumstance-of-sale adjustments by deducting direct selling expenses incurred on comparison market sales from, and adding U.S. direct selling expenses to, CV. See 19 CFR 351.410(c).

Currency Conversion

We made currency conversions into U.S. dollars in accordance with section 773A(a) of the Act based on the exchange rates in effect on the dates of the U.S. sales as certified by the Federal Reserve Bank.

Verification

As provided in section 782(i)(1) of the Act, we intend to verify the information relied upon in making our final determination.

Suspension of Liquidation

In accordance with section 733(d)(2) of the Act, we will direct U.S. Customs and Border Protection (CBP) to suspend liquidation of all entries of narrow woven ribbons from Taiwan that are entered, or withdrawn from warehouse, for consumption on or after the date of publication of this notice in the Federal Register. We will also instruct CBP to require a cash deposit or the posting of a bond equal to the weighted-average dumping margins, as indicated in the chart below. These instructions suspending liquidation will remain in effect until further notice.

The weighted-average dumping margins are as follows:Start Printed Page 7244

Manufacturer/ExporterWeighted-Average Margin (percent)
Dear Year Brothers Mfg. Co., Ltd.0.00
Roung Shu Industry Corporation4.54
Shienq Huong Enterprise Co., Ltd./Hsien Chan Enterprise Co., Ltd./Novelty Handicrafts Co., Ltd.0.00
All Others4.54

For Dear Year and Shienq Huong, because their estimated weighted-average preliminary dumping margins are zero, we are not directing CBP to suspend liquidation of either company's entries.

“All Others” Rate

Section 735(c)(5)(A) of the Act provides that the estimated “All Others” rate shall be an amount equal to the weighted average of the estimated weighted-average dumping margins established for exporters and producers individually investigated, excluding any zero or de minimis margins, and any margins determined entirely under section 776 of the Act.

Disclosure

We will disclose the calculations performed within five days of the date of publication of this notice to parties to this proceeding in accordance with 19 CFR 351.224(b).

ITC Notification

In accordance with section 733(f) of the Act, we have notified the ITC of the Department's preliminary affirmative determination of sales at LTFV. If the Department's final determination is affirmative, the ITC will determine before the later of 120 days after the date of this preliminary determination or 45 days after our final determination whether imports of narrow woven ribbons from Taiwan are materially injuring, or threatening material injury to, the U.S. industry (see section 735(b)(2) of the Act). As we are postponing the deadline for our final determination to 135 days from the date of the publication of this preliminary determination, the ITC will make its final determination no later than 45 days after our final determination.

Public Comment

Interested parties are invited to comment on the preliminary determination. Interested parties may submit case briefs to the Department related to sales issues no later than seven days after the date of the issuance of the last sales verification report issued in this proceeding; the case briefs related to cost of production issues may be submitted no later than seven days after the date of issuance of the last cost verification report issued in this proceeding. See 19 CFR 351.309(c). Rebuttal briefs, the content of which is limited to the issues raised in the case briefs, must be filed within five days from the deadline date for the submission of case briefs. See 19 CFR 351.309(d). A list of authorities used, a table of contents, and an executive summary of issues should accompany any briefs submitted to the Department. Executive summaries should be limited to five pages total, including footnotes.

In accordance with section 774 of the Act, the Department will hold a public hearing, if timely requested, to afford interested parties an opportunity to comment on arguments raised in case or rebuttal briefs, provided that such a hearing is requested by an interested party. If a timely request for a hearing is made in this investigation, we intend to hold the hearing two days after the rebuttal brief deadline date at the U.S. Department of Commerce, 14th Street and Constitution Avenue, NW, Washington, DC 20230, at a time and in a room to be determined. See 19 CFR 351.310. Parties should confirm by telephone, the date, time, and location of the hearing 48 hours before the scheduled date.

Interested parties who wish to request a hearing, or to participate in a hearing if one is requested, must submit a written request to the Assistant Secretary for Import Administration, U.S. Department of Commerce, Room 1870, within 30 days of the publication of this notice. Requests should contain: (1) the party's name, address, and telephone number; (2) the number of participants; and (3) a list of the issues to be discussed. At the hearing, oral presentations will be limited to issues raised in the briefs.

This determination is issued and published pursuant to sections 733(f) and 777(i)(1) of the Act.

Start Signature

Dated: February 4, 2010.

Ronald K. Lorentzen,

Deputy Assistant Secretary for Import Administration.

End Signature End Supplemental Information

Footnotes

1.  The petitioner in this investigation is Berwick Offray LLC and its wholly-owned subsidiary Lion Ribbon Company, Inc.

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[FR Doc. 2010-3133 Filed 2-17-10; 8:45 am]

BILLING CODE 3510-DS-S