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Notice

Polyethylene Terephthalate Film, Sheet, and Strip From India: Preliminary Results of Antidumping Duty New Shipper Review

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Start Preamble

AGENCY:

Import Administration, International Trade Administration, Department of Commerce.

SUMMARY:

The Department of Commerce (the Department) is conducting a semiannual new shipper review (NSR) under the antidumping duty order on polyethylene terephthalate film, sheet, and strip (PET film) from India in response to a request from SRF Limited (SRF). The domestic interested parties for this proceeding are DuPont Teijin Films, Mitsubishi Polyester Film, Inc., SKC, Inc. and Toray Plastics (America), Inc. (petitioners).

We preliminarily determine that the U.S. sale of subject merchandise produced and exported by SRF was bona fide and not sold below normal value (NV). If these preliminary results are adopted in our final results, the Department intends to instruct United States Customs and Border Protection (CBP) to liquidate entries subject to this review without regard to antidumping duties. Interested parties are invited to comment on these preliminary results. See the “Preliminary Results of Review” section of this notice. The final results will be issued 90 days after the date of signature of these preliminary results, unless extended.

DATES:

Effective Date: December 28, 2010.

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FOR FURTHER INFORMATION CONTACT:

Elfi Blum or Toni Page, AD/CVD Operations, Office 6, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, NW., Washington, DC 20230; telephone: (202) 482-0197 or (202) 482-1398, respectively.

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SUPPLEMENTARY INFORMATION:

Background

The Department published the antidumping duty order on PET film from India on July 1, 2002. See Notice of Amended Final Antidumping Duty Determination of Sales at Less Than Fair Value and Antidumping Duty Order: Polyethylene Terephthalate Film, Sheet, and Strip from India, 67 FR 44175 (July 1, 2002). On December 24, 2009, the Department received a timely request from SRF, in accordance with section 751(a)(2)(B) of the Tariff Act of 1930, as amended (the Act) and 19 CFR 351.214(c)(2), to conduct a semiannual new shipper review under the antidumping duty order on PET film from India. The Department found the request for review met all of the requirements for initiation set forth in Start Printed Page 8157119 CFR 351.214(b) and initiated the review on March 2, 2010. See Polyethylene Terephthalate Film, Sheet and Strip from India: Initiation of Antidumping Duty and Countervailing Duty New Shipper Reviews, 75 FR 10758 (March 9, 2010) (NSR Initiation).[1]

On April 6, 2010, the Department issued the initial questionnaire to SRF. On May 11, 2010, SRF submitted its section A response. On May 13, 2010, SRF submitted its responses to sections B and C of the questionnaire. On June 16, August 17, and September 15, 2010, the Department issued supplemental questionnaires to SRF and to its U.S. customer. SRF and its U.S. customer (through SRF) submitted responses to the questionnaires on July 14, August 30, and November 19, 2010, respectively.

On August 18, 2010, the Department extended the deadline for the preliminary results to October 22, 2010. See Polyethylene Terephthalate Film, Sheet and Strip from India: Extension of Time Limit for Preliminary Results of Antidumping Duty New Shipper Review, 75 FR 52717 (August 27, 2010). On October 18, 2010, the Department decided to further extend the deadline for the preliminary results to December 16, 2010, and then on December 16, 2010, the Department again extended the deadline to December 21, 2010. See Polyethylene Terephthalate Film, Sheet and Strip from India: Extension of Time Limit for Preliminary Results of Antidumping Duty New Shipper Review, 75 FR 65450 (October 25, 2010); Polyethylene Terephthalate Film, Sheet and Strip from India: Extension of Time Limit for Preliminary Results of Antidumping Duty New Shipper Review, (signed on Thursday, December 16, 2010, and not yet published prior to the signing of the instant notice).

Scope of the Order

The products covered by the antidumping duty 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 currently classifiable in the Harmonized Tariff Schedule of the United States (HTSUS) under item number 3920.62.00.90. HTSUS subheadings are provided for convenience and customs purposes. The written description of the scope of the antidumping duty order is dispositive.

Bona Fides Analysis

Consistent with Department practice, we examined the bona fides of the new shipper sale at issue. In evaluating whether a sale in a NSR is commercially reasonable, and therefore bona fide, the Department considers, inter alia, such factors as: (1) The timing of the sale; (2) the price and quantity; (3) the expenses arising from the transaction; (4) whether the goods were resold at a profit; and (5) whether the transaction was made on an arm's-length basis. See Tianjin Tiancheng Pharmaceutical Co., Ltd. v. United States, 366 F. Supp. 2d 1246, 1250 (Ct. Int'l Trade 2005) (TTPC). Accordingly, the Department considers a number of factors in its bona fides analysis, “all of which may speak to the commercial realities surrounding an alleged sale of subject merchandise.” See Hebei New Donghua Amino Acid Co., Ltd. v. United States, 374 F. Supp. 2d 1333, 1342 (Ct. Int'l Trade 2005) (New Donghua) (citing Fresh Garlic From the People's Republic of China: Final Results of Antidumping Administrative Review and Rescission of New Shipper Review, 67 FR 11283 (March 13, 2002), and accompanying Issues and Decision Memorandum (New Shipper Review of Clipper Manufacturing Ltd.)). In TTPC, the court also affirmed the Department's decision that “any factor which indicates that the sale under consideration is not likely to be typical of those which the producer will make in the future is relevant,” (TTPC, 366 F. Supp. 2d at 1250), and found that “the weight given to each factor investigated will depend on the circumstances surrounding the sale.” TTPC, 366 F. Supp. 2d at 1263. Finally, in New Donghua, the Court of International Trade affirmed the Department's practice of evaluating the circumstances surrounding a NSR sale, so that a respondent does not unfairly benefit from an atypical sale and obtain a lower dumping margin than the producer's usual commercial practice would dictate.

Based on the totality of circumstances, we preliminarily find that the sale made by SRF during the POR was a bona fide commercial transaction. The facts that led us to this preliminary conclusion include the following: (1) Neither the price nor quantity of the sale were outside normal bounds; (2) neither SRF nor its customer incurred any extraordinary expenses arising from this transaction; (3) the sale was made between unaffiliated parties at arm's length; and (4) the timing of the sale does not indicate that the sale was not bona fide. Since much of the factual information used in our analysis of the bona fides of the transaction involves business proprietary information, a full discussion of the bases for our decision is set forth in the Memorandum to Thomas Gilgunn, Program Manager, from Toni Page, International Trade Analyst, regarding Bona Fide Nature of the Sale in the Antidumping Duty New Shipper Review of Polyethylene Terephthalate Film, Sheet, and Strip from India: SRF Limited (Bona Fides Memorandum), dated concurrently with this notice and on file in the Central Records Unit (CRU), room 7046 of the main Department of Commerce building. We will continue to examine the bona fides of SRF's sale after the preliminary results.

Period of Review

The period of review (POR) for this NSR is July 1, 2009, through December 31, 2009.

Fair Value Comparisons

To determine whether SRF's sale of subject merchandise from India was made in the United States at less than NV, we compared the export price (EP) to the NV, as described in the “U.S. Price” and “Normal Value” section of this notice in accordance with section 777A(d)(2) of the Act.

Home Market Viability

In order 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 five percent or more of the aggregate volume of U.S. sales), we compared the volume of SRF's home market sales of the foreign like product to the volume of its U.S. sales of subject merchandise, in accordance with section 773(a)(1)(B)(ii)(II) of the Act. Based on this comparison, we determined that SRF's home market was viable during the POR.

Product Comparisons

Pursuant to section 771(16)(A) of the Act, for purposes of determining appropriate product comparisons to the U.S. sales, the Department considers all products, as described in the “Scope of the Order” section of this notice above, that were sold in the comparison market in the ordinary course of trade. In accordance with sections 771(16)(B) and Start Printed Page 81572(C) of the Act, where there are no sales of identical merchandise in the comparison market made in the ordinary course of trade, we compare U.S. sales to sales of the most similar foreign like product based on the characteristics listed in sections B and C of our antidumping questionnaire: Grade, specifications, thickness, dimensions, and surface treatment. We found that SRF had sales of foreign like product that were identical in these respects to the merchandise sold in the United States, and therefore compared the U.S. product with the identical merchandise sold in the comparison market based on the characteristics listed above, in that order of priority.

Date of Sale

Regarding date of sale, 19 CFR 351.401(i) states that the Department will normally use the date of invoice as the date of sale, unless a different date better reflects the date on which the material terms of sale are established. In its initial response, SRF reported invoice date as the date of sale for its home market sales and for its U.S. sale. Moreover, SRF reported that for both markets, it issues the invoice on the same date as it ships the merchandise. In its second supplemental questionnaire response, SRF stated that sometimes negotiations can continue after the invoice has been issued (and the goods have been shipped) for certain home market sales. See SRF's November 19, 2010, second supplemental questionnaire response at 9. In these circumstances, SRF does not issue a new invoice, rather it adjusts the invoice price by issuing a credit note. See Id. We have analyzed the data on the record and preliminarily determine that the reported invoice dates are the appropriate dates of sale for the U.S. and home market sales under review.

U.S. Price

We used EP methodology for SRF's U.S. sale, in accordance with section 772(a) of the Act, because the subject merchandise was sold directly to the first unaffiliated purchaser in the United States prior to importation, and constructed export price methodology was not otherwise warranted based on the facts of record. In accordance with sections 772(a) and (c) of the Act, we calculated EP using the delivered duty paid price SRF charged its unaffiliated customer. We made deductions, where applicable, for movement expenses, including, domestic inland freight, U.S. inland freight, domestic brokerage and handling, U.S. brokerage and handling, international freight, marine insurance, and U.S. Customs duties.

Information about the specific adjustments and our analysis of the adjustments is business proprietary, and is detailed in the “Adjustments” section in the Memorandum to Thomas Gilgunn, Program Manager, from Toni Page, International Trade Analyst, Analysis Memorandum for the Preliminary Results of the Antidumping Duty New Shipper Review of Polyethylene Terephthalate Film, Sheet, and Strip from India: SRF Limited, dated concurrently with this notice (Preliminary Analysis Memorandum).

Normal Value

In accordance with section 773(a)(1)(B)(i) of the Act, we have based NV on the price at which the foreign like product was first sold for consumption in the comparison market, in the usual commercial quantities, in the ordinary course of trade, and, to the extent practicable, at the same level of trade (LOT) as the EP sale. See “Level of Trade” section below.

Level of Trade

Pursuant to section 773(a)(1)(B)(i) of the Act, to the extent practicable, NV is normally the price in the home market that is at the same level of trade (LOT) as the EP. The NV LOT is that of the starting-price sale 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 the level of the starting-price sale, which is usually from exporter to unaffiliated customer. To determine whether NV sales are at a different LOT than EP sales, we examine stages in the selling functions along the chain of distribution between the producer and unaffiliated customer. If the comparison market sales are at a different LOT, and the difference affects the price comparability, as manifested in a pattern of consistent price differences between sales at different levels of trade in the country in which NV is determined, we make an LOT adjustment under section 773(a)(7)(A) of the Act and under section 351.410(c) of the Department's regulations. See, e.g., Notice of Final Determination of Sales at Less Than Fair Value: Certain Cut-to-Length Carbon Steel Plate from South Africa, 62 FR 61731 (November 19, 1997).

For the U.S. market, SRF reported only one channel of distribution (from SRF to unaffiliated U.S. trader) for its EP sale while, in the home market, SRF reported four channels (the four channels are: SRF to end user, SRF to dealer, SRF to dealer attached customer, and SRF to warehouse to dealer/dealer-attached customer). See section A questionnaire response at Exhibit A-5. SRF provided information about selling functions it performed in its home market for all three of its customer categories (end users, dealers, and dealer-attached customers) across the four channels of distribution. SRF reported that certain selling functions were not performed for all three home market customer categories. For its home market sales, SRF reported that its channel of distribution to dealers and dealer-attached customers were most similar to the channel of distribution to its U.S. sale. See section C questionnaire response at C-11 and SRF's Second Supplemental Questionnaire Response at 9.

After analyzing the information on the record with respect to these selling functions, we preliminarily find that there were sufficient differences in the selling functions performed for the different channels of trade to conclude that there is more than one level of trade in the home market. We examined the information reported by SRF with respect to its selling functions, freight functions, technical services/warranty functions, and inventory management functions. We examined the selling functions and the level of intensity at which SRF performs those selling functions in the home market channels of distribution, as described in the company's questionnaire responses. See section A questionnaire response at A-20 and Exhibit A-5; see also SRF's November 19, 2010, second supplemental questionnaire response at 8-9. Information about the specific selling functions we examined, the intensity at which SRF performed them, and our analysis is business proprietary and is detailed in the “Level of Trade” section in the Preliminary Analysis Memorandum. Based on the facts and our analysis of SRF's selling functions performed in the channels of distribution, we preliminarily conclude that SRF's home market sales were made at two distinct levels of trade: Sales directly from SRF to its end user and sales from SRF to its dealers and dealer-attached customers. See “Level of Trade” section in the Preliminary Analysis Memorandum.

As noted previously, SRF reported that its U.S. sale was made through one distribution channel, to an unaffiliated trader in the United States. For the U.S. market, we also examined the information reported by SRF with respect to the selling functions, the freight functions, and U.S. Customs functions performed by SRF for its sale to the unaffiliated U.S. customer. We examined the selling functions and the Start Printed Page 81573level of intensity at which SRF performs these selling functions as described in its questionnaire responses. See section A questionnaire response atA-19 through A-20 and at Exhibit A-5, section C questionnaire response at Exhibit C-1, and SRF's November 19, 2010, second supplemental questionnaire response at 8-9. Information about the specific selling functions we examined, the intensity at which SRF performed those selling functions for its U.S. sale (to the unaffiliated trader) and our analyses is business proprietary. As such, it is detailed in the “Level of Trade” section in the Preliminary Analysis Memorandum.

Based on our analysis, we preliminarily find that the U.S. sale is at the same LOT as SRF's home market sales to dealers and dealer-attached customers (LOTH 2). Since we are able to match the U.S. sale to home market sales at a comparable LOT, the Department finds that it is not necessary to make an LOT adjustment. For our complete analysis, see “Level of Trade” section in the Preliminary Analysis Memorandum.

Calculation of Normal Value

We based NV on the starting prices of SRF's sales to unaffiliated home market customers accounting for billing adjustments where applicable, pursuant to section 773(a)(1)(A) of the Act. Pursuant to section 773(a)(6)(B)(ii) of the Act, we made deductions from normal value for movement expenses (i.e., inland freight, warehousing, and inland insurance) where appropriate. In accordance with section 773(a)(6)(C)(iii) of the Act and 19 CFR 351.410(e), we made, where appropriate, circumstance-of-sale adjustments for home market and U.S. direct selling expenses including imputed credit expenses. We also made adjustments in accordance with 19 CFR 351.410(e) for indirect selling expenses incurred on comparison-market or U.S. sales where commissions were granted on sales in one market but not the other. Specifically, because commissions were paid only in the home market, we made an upward adjustment to NV for the lesser of: (1) the amount of commission paid in the home market; or (2) the amount of the indirect selling expenses incurred in the home market on U.S. sales. See 19 CFR 351.410(e). In accordance with sections 773(a)(6)(A) and (B) of the Act, we also deducted home market packing costs and added U.S. packing costs. See Preliminary Analysis Memorandum.

Currency Conversion

In accordance with section 773A(a) of the Act, we made currency conversions based on the official exchange rates in effect on the dates of the U.S. sales as certified by the Federal Reserve Bank of New York. See also 19 CFR 351.415.

Preliminary Results of New Shipper Review

As a result of our review, we preliminarily determine in accordance with 19 CFR 351.214(i)(1) that the following percentage margin exists for SRF for the period July 1, 2009, through December 31, 2009:

Manufacturer/exporterMargin
SRF Limited0%

Assessment Rate

Upon completion of the new shipper review, the Department shall determine, and CBP shall assess, antidumping duties on all appropriate entries, in accordance with 19 CFR 351.212(b). The Department intends to issue assessment instructions for SRF directly to CBP 15 days after the date of publication of the final results of this new shipper review.

Pursuant to 19 CFR 351.212(b)(1), we will calculate an importer-specific assessment rate on the basis of the ratio of the total amount of antidumping duties calculated for the examined sales and the total entered value of the examined sales. We will instruct CBP to assess antidumping duties on all appropriate entries covered by this review if the importer-specific assessment rate calculated in the final results of this review is above de minimis (i.e., at or above 0.50 percent). Pursuant to 19 CFR 351.106(c)(2), we intend to instruct CBP to liquidate without regard to antidumping duties any entries for which the assessment rate is zero or de minimis (i.e., less than 0.50 percent). See 19 CFR 351.106(c)(1).

Cash Deposit Requirements

The following cash deposit requirements will be effective for all shipments of the subject merchandise entered, or withdrawn from warehouse, for consumption on or after the publication date of the final results of this new shipper review, as provided by section 751(a)(2)(C) of the Act: (1) The cash deposit rate for subject merchandise that is both produced and exported by SRF will be the rate established in the final results of this new shipper review, except no cash deposit will be required if its weighted-average margin is de minimis (i.e., less than 0.5 percent); (2) if the exporter is not a firm covered in this review, but was covered in a previous review or the original less-than-fair-value (LTFV) investigation, the cash deposit rate will continue to be the company-specific rate published for the most recent period; (3) if the exporter is not a firm covered in this review, a previous review, or the original LTFV investigation, but the manufacturer is, the cash deposit rate will be the rate established for the most recent period for the manufacturer of the merchandise; and (4) the cash deposit rate for all other manufacturers and/or exporters of this merchandise, shall be 5.71 percent, the all-others rate established in the LTFV investigation. These requirements, when imposed, shall remain in effect until further notice.

Further, effective upon publication of the final results, we intend to instruct CBP that importers may no longer post a bond or other security in lieu of a cash deposit on imports of PET film from India, manufactured and exported by SRF. These cash deposit requirements, when imposed, shall remain in effect until further notice.

Verification

In accordance with section 782(i)(3) of the Act, the Department intends to conduct a sales verification of SRF's responses following the preliminary results of this review.

Disclosure and Public Hearing

The Department will disclose to parties the calculations performed in connection with these preliminary results within ten days of the date of public announcement. See 19 CFR 351.224(b). Unless notified by the Department, pursuant to 19 CFR 351.309(c), interested parties may submit cases briefs not later than 30 days after the date of publication of this notice. Rebuttal briefs, limited to issues raised in the case briefs, may be filed not later than five days after the deadline for filing the case briefs. See 19 CFR 351.309(d). Parties who submit case briefs or rebuttal briefs in this proceeding are requested to submit with each argument: (1) A statement of the issue; (2) a brief summary of the argument; and (3) a table of authorities. Additionally, parties are requested to provide their case briefs and rebuttal briefs in electronic format (e.g., WordPerfect, Microsoft Word, Adobe Acrobat, etc.).

Interested parties who wish to request a hearing or to participate if one is requested must submit a written request to the Assistant Secretary for Import Administration, Room B-099, within 30 days of the date of publication of this Start Printed Page 81574notice. Requests should contain: (1) The party's name, address and telephone number; (2) the number of participants; and (3) a list of issues to be discussed. See 19 CFR 351.310(c). Issues raised in the hearing will be limited to those raised in the case and rebuttal briefs.

The Department will issue the final results of this review, including the results of its analysis of issues raised in any written briefs, within 90 days of signature of these preliminary results, unless the final results are extended. See section 751(a)(2)(B)(iv) of the Act.

Notification to Importers

This notice serves as a preliminary reminder to importers of their responsibility under 19 CFR 351.402(f)(2) to file a certificate regarding the reimbursement of antidumping duties prior to liquidation of the relevant entries during this review period. Failure to comply with this requirement could result in the Secretary's presumption that reimbursement of antidumping duties occurred and the subsequent assessment of double antidumping duties.

This new shipper review is issued and published in accordance with sections 751(a)(2)(B)(iv) and 777(i)(1) of the Act, as well as 19 CFR 351.214(i).

Start Signature

Dated: December 21, 2010.

Christian Marsh,

Acting Deputy Assistant Secretary for Import Administration.

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Footnotes

1.  As stated in the initiation notice, due to the closure of the Federal Government in Washington D.C. between February 5 and February 12, 2010, the Department tolled its deadlines during that period, thereby extending all deadlines in this segment of the proceeding by seven days. Therefore, the deadline for the initiation of this new shipper review was extended by one week, to March 8, 2010. See NSR Initiation, 75 FR at 10758.

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[FR Doc. 2010-32680 Filed 12-27-10; 8:45 am]

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