[Federal Register Volume 64, Number 206 (Tuesday, October 26, 1999)] [Notices] [Pages 57628-57629] From the Federal Register Online via the Government Publishing Office [www.gpo.gov] [FR Doc No: 99-27834] ----------------------------------------------------------------------- DEPARTMENT OF COMMERCE International Trade Administration [A-580-805] Notice of Initiation and Preliminary Results of Changed Circumstances Antidumping Duty Administrative Review: Industrial Nitrocellulose From Korea AGENCY: Import Administration, International Trade Administration, Department of Commerce. SUMMARY: The Department of Commerce (``the Department'') has received information sufficient to warrant initiation of a changed circumstances administrative review of the antidumping duty order on industrial nitrocellulose (``INC'') from Korea. Based on this information, we preliminarily determine that Korea CNC Ltd., (``KCNC''), is the successor-in-interest to Daesang Corporation (``Daesang'') for purposes of determining antidumping liability. Interested parties are invited to comment on these preliminary results. EFFECTIVE DATE: October 26, 1999. FOR FURTHER INFORMATION CONTACT: Ron Trentham or Tom Futtner, AD/CVD Enforcement, Group II, Office 4, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th and Constitution Avenue, NW, Washington, DC 20230; telephone: (202) 482- 6320 or (202) 482-3814, respectively. SUPPLEMENTARY INFORMATION: Applicable Statute and Regulations Unless otherwise stated, all citations to the Tariff Act of 1930, as amended (``the Act''), are references to the provisions as of January 1, 1995, the effective date of the amendments made to the Act by the Uruguay Round Agreements Act (``URAA''). In addition, unless otherwise indicated, all references to the regulations of the Department are to 19 CFR part 351 (1998). [[Page 57629]] Background On July 10, 1990, the Department published in the Federal Register (55 FR 28267) the antidumping order on INC from Korea. On August 25, 1999, KCNC submitted a letter stating that KCNC is the successor-in- interest to Daesang, and, as such, KCNC is entitled to the receive the same antidumping treatment as is accorded Daesang. Scope of Review Imports covered by this review are shipments of INC from Korea. INC is a dry, white amorphous synthetic chemical with a nitrogen content between 10.8 and 12.2 percent, and is produced from the reaction of cellulose with nitric acid. INC is used as a film-former in coatings, lacquers, furniture finishes, and printing inks. The scope of this order does not include explosive grade nitrocellulose, which has a nitrogen content of greater than 12.2 percent. INC is currently classified under Harmonized Tariff System (``HTS'') subheading 3912.20.00. While the HTS item number is provided for convenience and Customs purposes, the written description remains dispositive as to the scope of the product coverage. Initiation and Preliminary Results of Review In a letter dated August 25, 1999, KCNC advised the Department that on April 1, 1999, China Nitrocellulose Co. (``CNC'') purchased Daesang's INC business, including Daesang's only manufacturing and research and development (``R&D'') facility for subject merchandise, located at Chonju Industrial Complex No. 3, 821 Yongam-Lee, Bongdong- Eub, Wanju-Gun, Chollabuk-Do, Korea (the ``Chonju factory''). CNC transferred Daesang's INC business to KCNC, which CNC had newly established for that purpose. KCNC operates the Chonju factory without change. Production continues with the same equipment, the same workers, the same raw materials purchased from the same suppliers, and the same production process. KCNC continues to sell the same products to the same customers to which Daesang previously sold. The organizational and management structure of Daesang's INC business has essentially remained intact, except that KCNC has appointed a new president. All management and employees at the plant manager level and below are the same as when the factory was managed by Daesang, while the managing director was formerly employed by Daesang in another capacity. Thus, in accordance with section 751(b) of the Act, the Department is initiating a changed circumstances review to determine whether KCNC is the successor-in-interest to Daesang for purposes of determining antidumping duty liability. In making such a successor-in-interest determination, the Department examines several factors including, but not limited to, changes in: (1) Management; (2) production facilities; (3) supplier relationships; and (4) customer base. See Brass Sheet and Strip from Canada: Notice of Final Results of Antidumping Administrative Review, 57 FR 20460 (May 13, 1992) (``Canadian Brass''). While no one or several of these factors will necessarily provide a dispositive indication, the Department will generally consider the new company to be the successor to the previous company if its resulting operation is not materially dissimilar to that of its predecessor. See, e.g., Industrial Phosphoric Acid from Israel: Final Results of Changed Circumstances Review, 59 FR 6944 (February 14, 1994) and Canadian Brass, 57 FR 20460. Thus, if the evidence demonstrates that, with respect to the production and sale of the subject merchandise, the new company operates as the same business entity as the former company, the Department will assign the new company the cash deposit rate of its predecessor. We preliminarily determine that KCNC is the successor-in-interest to Daesang. KCNC's management is virtually identical to Daesang. KCNC's business operation, with respect to the subject merchandise, is identical to the INC operations of Daesang. Production facilities are unchanged as are customer and supplier lists. Thus, KCNC should receive the same antidumping duty treatment as the former Daesang, i.e., a 2.10 percent antidumping duty cash deposit rate. This cash deposit requirement will apply to all unliquidated entries of the subject merchandise entered, or withdrawn from warehouse, for consumption on or after the date of publication of the final results of this changed circumstances review. This deposit rate shall remain in effect until publication of the final results of the next administrative review. Interested parties are invited to comment on these preliminary results. Any written comments may be submitted no later than 30 days after date of publication of this notice. Rebuttal briefs, limited to arguments raised in case briefs, are due five days after the case brief deadline. Case briefs and rebuttal briefs must be served on interested parties in accordance with 19 CFR 351.309. The Department will publish the final results of the changed circumstances review including the results of any such comments. This initiation of review, preliminary results of review and notice are in accordance with sections 751(b) and 777(i)(1) of the Act. Dated: October 18, 1999. Robert A. LaRussa, Assistant Secretary, Import Administration. [FR Doc. 99-27834 Filed 10-25-99; 8:45 am] BILLING CODE 3510-DS-P