[Federal Register Volume 64, Number 66 (Wednesday, April 7, 1999)]
[Notices]
[Pages 16904-16906]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-8623]
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DEPARTMENT OF COMMERCE
International Trade Administration
[A-469-007]
Final Results of Expedited Sunset Review: Potassium Permanganate
from Spain
AGENCY: Import Administration, International Trade Administration,
Department of Commerce.
ACTION: Notice of Final Results of Expedited Sunset Review: Potassium
Permanganate from Spain.
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SUMMARY: On November 2, 1998, the Department of Commerce (``the
Department'') initiated a sunset review of the antidumping order on
potassium permanganate from Spain (63 FR 58709) pursuant to section
751(c) of the Tariff Act of 1930, as amended (``the Act''). On the
basis of a notice of intent to participate and substantive comments
filed on behalf of the domestic industry and inadequate response (in
this case, no response) from respondent interested parties, the
Department determined to conduct an expedited review. As a result of
this review, the Department finds that revocation of the antidumping
order would be likely to lead to continuation or recurrence of dumping
at the levels indicated in the Final Results of Review section of this
notice.
FOR FURTHER INFORMATION CONTACT: Scott E. Smith or Melissa G. Skinner,
Office of Policy for Import Administration, International Trade
Administration, U.S. Department of Commerce, 14th Street and
Constitution Avenue, NW, Washington, D.C. 20230; telephone: (202) 482-
6397 or (202) 482-1560, respectively.
EFFECTIVE DATE: April 7, 1999.
Statute and Regulations
This review was conducted pursuant to sections 751(c) and 752 of
the Act. The Department's procedures for the conduct of sunset reviews
are set forth in Procedures for Conducting Five-year (``Sunset'')
Reviews of Antidumping and Countervailing Duty Orders, 63 FR 13516
(March 20, 1998) (``Sunset Regulations''). Guidance on methodological
or analytical issues relevant to the Department's conduct of sunset
reviews is set forth in the Department's Policy Bulletin 98:3--Policies
Regarding the Conduct of Five-year (``Sunset'') Reviews of Antidumping
and Countervailing Duty Orders; Policy Bulletin, 63 FR 18871 (April 16,
1998) (``Sunset Policy Bulletin'').
Scope
The merchandise subject to this antidumping order is potassium
permanganate from Spain, an inorganic chemical produced in free-
flowing, technical, and pharmaceutical grades. Potassium permanganate
is classifiable under item 2841.61.0000 of the Harmonized Tariff
Schedule of the United States (HTSUS). The HTSUS item number is
provided for convenience and U.S. Customs purposes. The written
description remains dispositive.
This review covers imports from all manufacturers and exporters of
Spanish potassium permanganate.
Background
On November 2, 1998, the Department initiated a sunset review of
the antidumping order on potassium permanganate from Spain (63 FR
58709), pursuant to section 751(c) of the Act. The Department received
a Notice of Intent to Participate on behalf of Carus Chemical Company
(``Carus'') on November 16, 1998, within the deadline specified in
section 351.218(d)(1)(i) of the Sunset Regulations. Carus claimed
interested party status under 19 U.S.C. 1677(9)(C) as a U.S. producer
of potassium permanganate. In addition, Carus indicated that it was the
original petitioner in this proceeding and that it has regularly
participated in all administrative reviews. We received a complete
substantive response from Carus on December 2, 1998, within the 30-day
deadline specified in the Sunset Regulations under section
351.218(d)(3)(i). We did not receive a substantive response from any
respondent interested party to this proceeding. As a result, pursuant
to 19 CFR 351.218(e)(1)(ii)(C), the Department determined to conduct an
expedited, 120-day review of this order.
The Department determined that the sunset review of the antidumping
duty order on potassium permanganate from Spain is extraordinarily
complicated. In accordance with section 751(c)(5)(C)(v) of the Act, the
Department may treat a review as extraordinarily complicated if it is a
review of a transition order (i.e., an order in effect on January 1,
1995). (See section 751(c)(6)(C) of the Act.) Therefore, on March 2,
1999, the Department extended the time limit for completion of the
final results of this review until not later than June 1, 1999, in
accordance with section 751(c)(5)(B) of the Act.1
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\1\ See Potassium Permanganate from Spain and the People's
Republic of China: Extension of Time Limit for Final Results of
Five-Year Review, 64 FR 10991 (March 8, 1999).
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Determination
In accordance with section 751(c)(1) of the Act, the Department
conducted this review to determine whether revocation of the
antidumping order would be likely to lead to continuation or recurrence
of dumping. Section 752(c) of the Act provides that, in making this
determination, the Department shall consider the weighted-average
dumping margins determined in the investigation and subsequent reviews
and the volume of imports of the subject merchandise for the period
before and the period after the issuance of the antidumping order, and
shall provide to the International Trade Commission (``the
Commission'') the magnitude of the margin of dumping likely to prevail
if the order is revoked.
The Department's determinations concerning continuation or
recurrence of dumping and the magnitude of the
[[Page 16905]]
margin are discussed below. In addition, Carus' comments with respect
to continuation or recurrence of dumping and the magnitude of the
margin are addressed within the respective sections below.
Continuation or Recurrence of Dumping
Drawing on the guidance provided in the legislative history
accompanying the Uruguay Round Agreements Act (``URAA''), specifically
the Statement of Administrative Action (``the SAA''), H.R. Doc. No.
103-316, vol. 1 (1994), the House Report, H.R. Rep. No. 103-826, pt.1
(1994), and the Senate Report, S. Rep. No. 103-412 (1994), the
Department issued its Sunset Policy Bulletin providing guidance on
methodological and analytical issues, including the bases for
likelihood determinations. In its Sunset Policy Bulletin, the
Department indicated that determinations of likelihood will be made on
an order-wide basis (see section II.A.3). In addition, the Department
indicated that normally it will determine that revocation of an
antidumping order is likely to lead to continuation or recurrence of
dumping where (a) dumping continued at any level above de minimis after
the issuance of the order, (b) imports of the subject merchandise
ceased after the issuance of the order, or (c) dumping was eliminated
after the issuance of the order and import volumes for the subject
merchandise declined significantly (see section II.A.3).
In addition to guidance on likelihood provided in the Sunset Policy
Bulletin and legislative history, section 751(c)(4)(B) of the Act
provides that the Department shall determine that revocation of an
order is likely to lead to continuation or recurrence of dumping where
a respondent interested party waives its participation in the sunset
review. In the instant review, the Department did not receive a
response from any respondent interested party. Pursuant to section
351.218(d)(2)(iii) of the Sunset Regulations, this constitutes a waiver
of participation.
The antidumping duty order on potassium permanganate from Spain was
published in the Federal Register on January 19, 1984 (49 FR 2277).
Since that time, the Department has conducted three administrative
reviews.2 The order remains in effect for all manufacturers
and exporters of the subject merchandise.
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\2\ See Potassium Permanganate from Spain; Early Determination
of Antidumping Duty, 49 FR 18341 (April 30, 1984); Final Results of
Antidumping Duty Administrative Review; Potassium Permanganate From
Spain, 53 FR 21504 (June 8, 1988); and Final Results of Antidumping
Duty Administrative Review; Potassium Permanganate From Spain, 56 FR
58361 (November 19, 1991). Prior to the imposition of the order, the
Department published Potassium Permanganate from Spain; Final
Determination of Sales at Less Than Fair Value, 48 FR 53589
(November 28, 1983).
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In its substantive response, Carus argued that ``it is highly
likely that dumping would continue if the antidumping order in this
case (the ``Order'') were to be revoked''. With respect to whether
dumping continued at any level above de minimis after the issuance of
the order, Carus stated that the uninterrupted existence of dumping
margins for the past decade--and continued failure of IQN [Industrial
Quimica del Nalon] to challenge this margin through annual review--
provides compelling evidence that Spanish potassium permanganate would
be dumped in the U.S. market in the absence of the order (see December
2, 1998, Substantive Response of Carus at page 6).
With respect to whether imports of the subject merchandise ceased
after the issuance of the order, Carus, citing its own shipment data
and official U.S. Census Bureau import statistics, argued that imports
of Spanish-origin potassium permanganate increased by almost 250%
between 1983 and 1986 and reached an all-time high of over 2.5 million
lbs. in 1986, accounting for over 14% of the U.S. market. Moreover,
Carus asserts that, during the 1983-86 period, increasing levels of
imports were accompanied by increasing levels of dumping, not declining
or no dumping (see December 2, 1998, Substantive Response of Carus at
7). Carus further argues that the ability of Spanish producers of
potassium permanganate to export large quantities of subject
merchandise to the U.S. with dumping margins in place suggests that
revocation of the order could prompt a massive influx of potassium
permanganate into the U.S. at below fair market value. Carus notes that
total imports of the subject merchandise continued in substantial
volumes during all years when the order was in effect.
In addition, Carus states that there are other factors which
support the likelihood of dumping if the order were revoked. Carus
argues that the attractiveness of the U.S. market would promote
increased imports of Spanish potassium permanganate because U.S. prices
of this product are at a premium while prices elsewhere in the world
are well below U.S. levels. Furthermore, Carus asserts that Spanish
producers have an overcapacity of the subject merchandise and see the
U.S., with its premium prices for potassium permanganate, as a vibrant
market where they can sell their product.
In conclusion, Carus argued that the Department should determine
that there is a likelihood that dumping would continue were the order
revoked because (1) dumping margins have existed and continue to exist,
(2) shipments of subject merchandise have continued throughout the life
of the life of the order, (3) premium prices for potassium permanganate
in the U.S. will promote continued, if not increased, dumping by
Spanish producers and (4) Spanish producers have an overcapacity of the
subject merchandise and need markets, especially ones with high prices,
in which to sell.
As discussed in Section II.A.3 of the Sunset Policy Bulletin, the
SAA at 890, and the House Report at 63-64, if companies continue
dumping with the discipline of an order in place, the Department may
reasonably infer that dumping would continue if the discipline were
removed. A dumping margin above de minimis has existed throughout most
of the life of the order, and continues to exist, for shipments of the
subject merchandise from all Spanish producers/exporters.3
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\3\ See Potassium Permanganate from Spain; Early Determination
of Antidumping Duty, 49 FR 18341 (April 30, 1984); Final Results of
Antidumping Duty Administrative Review; Potassium Permanganate From
Spain, 53 FR 21504 (June 8, 1988); and Final Results of Antidumping
Duty Administrative Review; Potassium Permanganate From Spain, 56 FR
58361 (November 19, 1991).
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Consistent with section 752(c) of the Act, the Department also
considered the volume of imports before and after issuance of the
order. The import statistics provided by Carus on imports of the
subject merchandise between 1981 and 1998, and those examined by the
Department (U.S. Census Bureau IM146 reports), demonstrate that imports
of the subject merchandise continued throughout the life of the order.
Based on this analysis, the Department finds that the existence of
dumping margins after the issuance of the order is highly probative of
the likelihood of continuation or recurrence of dumping. Deposit rates
above a de minimis level continue in effect for exports of the subject
merchandise by all known Spanish manufacturers/exporters. Therefore,
given that dumping has continued over the life of the order and
respondent interested parties have waived their right to participate in
this review before the Department, and absent argument and evidence to
the contrary, the Department determines that dumping is
[[Page 16906]]
likely to continue if the order were revoked.
Because the Department based this determination on the continued
existence of margins above de minimis and respondent interested
parties' waiver of participation, it is not necessary to address Carus'
arguments concerning the attractiveness of the U.S. market and Spanish
overcapacity and export orientation.
Magnitude of the Margin
In the Sunset Policy Bulletin, the Department stated that it will
normally provide to the Commission the margin that was determined in
the final determination in the original investigation. Further, for
companies not specifically investigated or for companies that did not
begin shipping until after the order was issued, the Department
normally will provide a margin based on the ``all others'' rate from
the investigation. (See section II.B.1 of the Sunset Policy Bulletin.)
Exceptions to this policy include the use of a more recently calculated
margin, where appropriate, and consideration of duty absorption
determinations. (See sections II.B.2 and 3 of the Sunset Policy
Bulletin.)
The Department, in its final determination of sales at less than
fair value, published a weighted-average dumping margin for
Asturquimica,4 a Spanish producer/exporter of potassium
permanganate, of 5.49 percent (48 FR 53589, November 28, 1983). The
Department also published an ``all others'' rate of 5.49 percent in
this same Federal Register notice. We note that, to date, the
Department has not issued any duty absorption findings in this case.
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\4\ Asturquimica has since merged with IQN (see Final Results of
Redetermination Pursuant to Court Remand, Industrial Quimica del
Nalon v. United States, Slip Op. 89-174 (December 21, 1989)). Since
1989, the Department has considered IQN the successor to
Asturquimica.
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In its substantive response, Carus argues that the Department, as
stipulated in the Sunset Policy Bulletin, should provide the Commission
a more recently calculated margin. Citing the Sunset Policy Bulletin,
Carus states that ``[a] company may choose to increase dumping in order
to maintain or increase market share. As a result, increasing margins
may be more representative of a company's behavior in the absence of an
order.'' According to Carus, in the administrative review covering
August 9, 1983 through January 10, 1984 (49 FR 18341, April 30, 1984),
the Department determined that no dumping of Spanish potassium
permanganate had occurred during this period justifying a cash deposit
rate of zero. After this review, Carus argues that imports of Spanish
potassium permanganate soared, reaching a zenith of 2.5 million lbs. in
1986. Carus adds that when it subsequently requested an administrative
review (53 FR 21504, June 8, 1988), a dumping margin of 16.16 percent
was established for all imports of the subject merchandise. We note
that this margin was decreased to 5.53 percent following litigation
before the U.S. Court of International Trade.5
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\5\ Pursuant to an initial court remand, this margin was changed
to 12.87 percent (see Final Results of Redetermination Pursuant to
Court Remand, Industrial Quimica del Nalon v. United States, Slip
Op. 89-174 (December 21, 1989)). Pursuant to a second court remand,
the 12.87 percent margin was changed to 5.53 percent (see Final
Results of Redetermination Pursuant to Court Remand, Industrial
Quimica del Nalon v. United States, Slip Op. 91-43 (May 24, 1991)).
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Carus submits that the determination of no dumping in the 1984
administrative review precipitated an enormous influx of subject
merchandise, being sold at less than fair value, because it was no
longer subject to the restraint imposed by a positive margin rate.
Carus argues that the increase in imports of Spanish potassium
permanganate to 2.5 million lbs. from 1983 to 1986 represents an
increase of more than 210 percent over this three year period and 250
percent from pre-order levels just five years earlier. In addition,
according to Carus, this increase in Spanish imports allowed Spanish
producers/exporters to increase their percentage of the market share
from just under 6 percent in 1982 (during the period of investigation)
to 14.1 percent by 1986. Carus submits that the margin calculated in
the administrative review for the period January 1, 1986 to December
31, 1986 (53 FR 21504, June 8, 1988) is more appropriate to report to
the Commission.
Further, Carus reasserts its argument concerning the high price of
potassium permanganate in the U.S. with respect to its price on the
world market. Carus argues that export prices in non-U.S. markets for
potassium permanganate fell by over $0.13/lb during 1997 and 1998.
Importers in the U.S. market, however, paid a price premium of $0.25/lb
in 1997 and $0.23/lb. in 1998.
The Department agrees with Carus' argument concerning the choice of
the margin rate to report to the Commission. An examination of the
margin history of the order as well as an examination of import
statistics of the subject merchandise, as provided in U.S. Census
Bureau IM146 reports, confirms the scenario outlined by Carus. From
1983 to 1986, import volumes of the subject merchandise more than
doubled. During this period, there was a cash deposit rate of zero in
effect. Following the request for an administrative review by Carus,
the Department established a dumping margin above de minimis levels (53
FR 21504, June 8, 1988). The increase in import volumes during this
period of unrestricted market access resulted in an increase in the
market share held by Spanish imports. According to the Sunset Policy
Bulletin, ``a company may choose to increase dumping in order to
maintain or increase market share. As a result, increasing margins may
be more representative of a company's behavior in the absence of an
order.'' Therefore, given the increase in imports through 1986,
accompanied by the increase in the dumping margin in 1986, the
Department finds this more recent rate is the most probative of the
behavior of the known Spanish producer/exporter of potassium
permanganate if the order were revoked. As such, the Department will
report to the Commission the company-specific and ``all others'' rates
from the administrative review for the period January 1, 1986 through
December 31, 1986 as contained in the Final Results of Review section
of this notice.
Final Results of Review
As a result of this review, the Department finds that revocation of
the antidumping duty order would likely lead to continuation or
recurrence of dumping at the margins listed below:
------------------------------------------------------------------------
Margin
Manufacturer/exporter (percent)
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IQN........................................................ 5.53
All Others................................................. 5.53
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This notice serves as the only reminder to parties subject to
administrative protective order (APO) of their responsibility
concerning the disposition of proprietary information disclosed under
APO in accordance with 19 CFR 351.305 of the Department's regulations.
Timely notification of return/destruction of APO materials or
conversion to judicial protective order is hereby requested. Failure to
comply with the regulations and the terms of an APO is a sanctionable
violation.
This five-year (``sunset'') review and notice are in accordance
with sections 751(c), 752, and 777(i)(1) of the Act.
Dated: April 1, 1999.
Robert S. LaRussa,
Assistant Secretary for Import Administration.
[FR Doc. 99-8623 Filed 4-6-99; 8:45 am]
BILLING CODE 3510-DS-P