[Federal Register Volume 74, Number 150 (Thursday, August 6, 2009)]
[Notices]
[Pages 39298-39302]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E9-18892]
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DEPARTMENT OF COMMERCE
International Trade Administration
[C-570-953]
Narrow Woven Ribbons With Woven Selvedge From the People's
Republic of China: Initiation of Countervailing Duty Investigation
AGENCY: Import Administration, International Trade Administration,
Department of Commerce.
DATES: Effective Date: August 6, 2009.
FOR FURTHER INFORMATION CONTACT: Robert Copyak, Shelly Atkinson, or
Justin Neuman, AD/CVD Operations, Office 1, Import Administration,
International Trade Administration, U.S. Department of Commerce, 14th
Street and Constitution Avenue, NW., Washington, DC 20230; telephone:
(202) 482-2209, (202) 482-0116, and (202) 482-0486, respectively.
SUPPLEMENTARY INFORMATION:
The Petition
On July 9, 2009, the Department of Commerce (``the Department'')
received countervailing duty (``CVD'') and antidumping duty (``AD'')
petitions concerning imports of narrow woven ribbons with woven
selvedge (``narrow woven ribbons'') from the People's Republic of China
(``PRC''). The petitions were filed in proper form by
[[Page 39299]]
Berwick Offray LLC and its wholly-owned subsidiary Lion Ribbon Company,
Inc. (collectively, ``the Petitioner''), a domestic producer of narrow
woven ribbons. See ``Petition for Countervailing Duty and Antidumping
Duty Investigations of China and an Antidumping Duty Investigation of
Taiwan on Imports of Narrow Woven Ribbons with Woven Selvedge'' (``the
Petition''). On July 13, 2009, the Department issued a request for
additional information and clarification of certain of the Petitioner's
subsidy allegations. See Letter from Brandon Farlander, Program
Manager, AD/CVD Operations, Office 1, to the Petitioner, ``Petition for
the Imposition of Countervailing Duties on Imports of Narrow Woven
Ribbons with Woven Selvedge from the People's Republic of China:
Questions Regarding the Countervailing Duty Allegations,'' dated July
13, 2009. In response to the Department's request, the Petitioner
timely filed additional information on July 17, 2009. See Supplement to
the CVD Petition, dated July 17, 2009. On July 14, 2009, the Department
contacted the Petitioner by telephone seeking additional information
and clarification regarding the Petition. See Memorandum to the File
from Matthew Glass, ``Scope Call with the Petitioner,'' dated July 14,
2009. On July 15, 2009, a request seeking clarification regarding the
general issues of the Petition was sent to the Petitioner. See Letter
from Shawn Thompson, Program Manager, AD/CVD Operations, Office 2, to
the Petitioner, ``Regarding Petitions for the Imposition of Antidumping
and Countervailing Duties on Imports of Narrow Woven Ribbons with Woven
Selvedge (``NWR'') from the People's Republic of China and Antidumping
Duties on Imports of NWR from Taiwan: Supplemental Questions,'' dated
July 15, 2009. A second request seeking additional information and
clarification regarding the Petition was sent to the Petitioner on July
17, 2009. See Letter from Brandon Farlander, Program Manager, AD/CVD
Operations, Office 1, to the Petitioner, ``Petition for the Imposition
of Countervailing Duties on Imports of Narrow Woven Ribbons with Woven
Selvedge from the People's Republic of China: Questions Regarding the
Countervailing Duty Allegations,'' dated June 17, 2009. In response to
the Department's request, the Petitioner timely filed additional
information pertaining to the Petition on July 21, 2009. See Supplement
to the AD/CVD Petitions, dated July 21, 2009. On July 22, 2009, another
request seeking clarification regarding the general issues of the
Petition was sent to the Petitioner. See Letter from Shawn Thompson,
Program Manager, AD/CVD Operations, Office 2, to the Petitioner,
``Regarding Supplement to the Petitions for the Imposition of
Antidumping and Countervailing Duties on Imports of Narrow Woven
Ribbons with Woven Selvedge (NWR) from the People's Republic of China
and Antidumping Duties on Imports of NWR from Taiwan: Additional
Questions,'' dated July 22, 2009. On July 23, 2009, and July 24, 2009,
the Department contacted the Petitioner by telephone seeking additional
information and clarification regarding the Petition. See Memorandum to
the File from Meredith A.W. Rutherford, ``General Issues Discussion
with the Petitioner,'' dated July 23, 2009; see also Memorandum to the
File from David Layton, Trade Analyst, AD/CVD Operations, Office 1,
``Petition for the Imposition of Countervailing Duties on Imports of
Narrow Woven Ribbons with Woven Selvedge from the People's Republic of
China: Question Regarding the Countervailing Duty Allegations,'' dated
July 24, 2009. Based on the Department's request, the Petitioner timely
filed additional information pertaining to the Petition on July 27,
2009. See Second Supplement to the AD/CVD Petitions, dated July 27,
2009. On July 28, 2009, the Department again contacted the Petitioner
by telephone seeking additional information and clarification regarding
certain general issues of the Petition. See Memorandum to the File from
Meredith A.W. Rutherford, ``Phone Call with the Petitioner,'' dated
July 28, 2009, and Memorandum to the File from Elizabeth Eastwood,
``Scope Calls with the Petitioner,'' dated July 29, 2009. Based on the
Department's request, the Petitioner timely filed additional
information pertaining to the Petition on July 29, 2009. See Third
Supplement to the AD/CVD Petitions, dated July 29, 2009.
In accordance with section 702(b)(1) of the Tariff Act of 1930, as
amended (``the Act''), the Petitioner alleges that producers/exporters
of narrow woven ribbons in the PRC received countervailable subsidies
within the meaning of sections 701 and 771(5) of the Act and that
imports materially injure, or threaten material injury to, an industry
in the United States.
The Department finds that the Petitioner filed this Petition on
behalf of the domestic industry because it is an interested party as
defined in section 771(9)(C) of the Act, and the Petitioner has
demonstrated sufficient industry support with respect to the CVD
investigation that it is requesting the Department to initiate (see
``Determination of Industry Support for the Petition'' below).
Period of Investigation
The anticipated period of investigation (``POI'') is calendar year
2008. See 19 CFR 351.204(b)(2).
Scope of Investigation
The products covered by this investigation are narrow woven ribbons
with woven selvedge from the PRC. For a full description of the scope
of the investigation, please see the ``Scope of Investigation'' in
Appendix I to this notice.
Comments on Scope of Investigation
During our review of the Petition, we discussed the scope with the
Petitioner to ensure that it is an accurate reflection of the products
for which the domestic industry is seeking relief. Moreover, as
discussed in the preamble to the regulations (See Antidumping Duties;
Countervailing Duties; Final Rule, 62 FR 27296, 27323 (May 19, 1997)),
we are setting aside a period for interested parties to raise issues
regarding product coverage. The Department encourages all interested
parties to submit such comments by August 18, 2009, twenty calendar
days from the signature of this notice. Comments should be addressed to
Import Administration's APO/Dockets Unit, Room 1870, U.S. Department of
Commerce, 14th Street and Constitution Avenue, NW., Washington, DC
20230. The period of scope consultations is intended to provide the
Department with ample opportunity to consider all comments and to
consult with parties prior to the issuance of the preliminary
determinations.
Consultations
Pursuant to section 702(b)(4)(A)(ii) of the Act, the Department
held consultations with the Government of the PRC (hereinafter, the
GOC) with respect to the Petition on July 24, 2009. See Memorandum to
the File, ``Countervailing Duty Petition on Narrow Woven Ribbons with
Woven Selvedge from the People's Republic of China--Consultations with
the Government of China,'' on file in the CRU, Room 1117 of the main
Department of Commerce building.
Determination of Industry Support for the Petition
Section 702(b)(1) of the Act requires that a petition be filed on
behalf of the domestic industry. Section 702(c)(4)(A) of the Act
provides that a petition meets
[[Page 39300]]
this requirement if the domestic producers or workers who support the
petition account for: (i) At least 25 percent of the total production
of the domestic like product; and (ii) more than 50 percent of the
production of the domestic like product produced by that portion of the
industry expressing support for, or opposition to, the petition.
Moreover, section 702(c)(4)(D) of the Act provides that, if the
petition does not establish support of domestic producers or workers
accounting for more than 50 percent of the total production of the
domestic like product, the Department shall: (i) Poll the industry or
rely on other information in order to determine if there is support for
the petition, as required by subparagraph (A); or (ii) determine
industry support using a statistically valid sampling method to poll
the industry.
Section 771(4)(A) of the Act defines the ``industry'' as the
producers as a whole of a domestic like product. Thus, to determine
whether a petition has the requisite industry support, the statute
directs the Department to look to producers and workers who produce the
domestic like product. The International Trade Commission (``ITC''),
which is responsible for determining whether ``the domestic industry''
has been injured, must also determine what constitutes a domestic like
product in order to define the industry. While both the Department and
the ITC must apply the same statutory definition regarding the domestic
like product (section 771(10) of the Act), they do so for different
purposes and pursuant to a separate and distinct authority. In
addition, the Department's determination is subject to limitations of
time and information. Although this may result in different definitions
of the like product, such differences do not render the decision of
either agency contrary to law. See USEC, Inc. v. United States, 132 F.
Supp. 2d 1, 8 (Ct. Int'l Trade 2001), citing Algoma Steel Corp., Ltd.
v. United States, 688 F. Supp. 639, 644 (Ct. Int'l Trade 1988), aff'd
865 F.2d 240 (Fed. Cir. 1989), cert. denied 492 U.S. 919 (1989).
Section 771(10) of the Act defines the domestic like product as ``a
product which is like, or in the absence of like, most similar in
characteristics and uses with, the article subject to an investigation
under this title.'' Thus, the reference point from which the domestic
like product analysis begins is ``the article subject to an
investigation'' (i.e., the class or kind of merchandise to be
investigated, which normally will be the scope as defined in the
petition).
With regard to the domestic like product, the Petitioner does not
offer a definition of domestic like product distinct from the scope of
the investigation. Based on our analysis of the information submitted
on the record, we have determined that narrow woven ribbons constitute
a single domestic like product and we have analyzed industry support in
terms of that domestic like product. For a discussion of the domestic
like product analysis in this case, see Countervailing Duty
Investigation Initiation Checklist: Narrow Woven Ribbons with Woven
Selvedge from the People's Republic of China (``CVD Initiation
Checklist'') at Attachment II (Industry Support), dated concurrently
with this notice and on file in the CRU, Room 1117 of the main
Department of Commerce building.
In determining whether the Petitioner has standing under section
702(c)(4)(A) of the Act, we considered the industry support data
contained in the Petition with reference to the domestic like product
as defined in the ``Scope of Investigation'' in Appendix I. To
establish industry support, the Petitioner provided its production of
the domestic like product for the year 2008, and compared this to the
total estimated production of the domestic like product for the entire
domestic industry. See Volume I of the Petition, at 7, and Exhibits 2,
4, and 5, Supplement to the AD/CVD Petitions, dated July 21, 2009, at
A-9-11, Second Supplement to the AD/CVD Petitions, dated July 27, 2009,
at A-1-2 and Exhibit 117, and Third Supplement to the AD/CVD Petitions,
dated July 29, 2009, at Attachment II. To estimate 2008 production of
the domestic like product, the Petitioner used its own data and
industry specific knowledge. The Petitioner calculated total domestic
production based on its own production plus estimates from the nine
other producers of the domestic like product in the United States. See
id., see also CVD Initiation Checklist at Attachment II, Industry
Support.
Our review of the data provided in the Petition, supplemental
submissions, and other information readily available to the Department
indicates that the Petitioner has established industry support. First,
the Petition established support from domestic producers (or workers)
accounting for more than 50 percent of the total production of the
domestic like product and, as such, the Department is not required to
take further action in order to evaluate industry support (e.g.,
polling). See section 702(c)(4)(D) of the Act; see also CVD Initiation
Checklist at Attachment II. Second, the domestic producers (or workers)
have met the statutory criteria for industry support under section
702(c)(4)(A)(i) of the Act because the domestic producers (or workers)
who support the Petition account for at least 25 percent of the total
production of the domestic like product. See CVD Initiation Checklist
at Attachment II. Finally, the domestic producers (or workers) have met
the statutory criteria for industry support under section
702(c)(4)(A)(ii) of the Act because the domestic producers (or workers)
who support the Petition account for more than 50 percent of the
production of the domestic like product produced by that portion of the
industry expressing support for, or opposition to, the Petition.
Accordingly, the Department determines that the Petition was filed on
behalf of the domestic industry within the meaning of section 702(b)(1)
of the Act. See id.
Injury Test
Because the PRC is a ``Subsidies Agreement Country'' within the
meaning of section 701(b) of the Act, section 701(a)(2) of the Act
applies to this investigation. Accordingly, the ITC must determine
whether imports of the subject merchandise from the PRC materially
injure, or threaten material injury to, a U.S. industry.
Allegations and Evidence of Material Injury and Causation
The Petitioner alleges that imports of narrow woven ribbons from
the PRC are benefitting from countervailable subsidies and that such
imports are causing, or threaten to cause, material injury to the
domestic industry producing narrow woven ribbons. In addition, the
Petitioner alleges that subsidized imports exceed the negligibility
threshold provided for under section 771(24)(A) of the Act.
The Petitioner contends that the industry's injured condition is
illustrated by reduced market share, underselling and price depressing
and suppressing effects, increased import penetration, lost sales and
revenue, reduced production, reduced capacity, reduced capacity
utilization, reduced shipments, reduced employment, and an overall
decline in financial performance. We have assessed the allegations and
supporting evidence regarding material injury, threat of material
injury, and causation, and we have determined that these allegations
are properly supported by adequate evidence and meet the statutory
requirements for initiation. See CVD Initiation Checklist at Attachment
III (Analysis of Allegations and Evidence of Material Injury and
Causation for the Petition).
[[Page 39301]]
Initiation of Countervailing Duty Investigation
Section 702(b) of the Act requires the Department to initiate a CVD
proceeding whenever an interested party files a CVD petition on behalf
of an industry that: (1) Alleges the elements necessary for an
imposition of a duty under section 701(a) of the Act; and (2) is
accompanied by information reasonably available to the petitioner
supporting the allegations.
The Department has examined the Petition on narrow woven ribbons
from the PRC and finds that it complies with the requirements of
section 702(b) of the Act. Therefore, in accordance with section 702(b)
of the Act, we are initiating a CVD investigation to determine whether
producers/exporters of narrow woven ribbons in the PRC receive
countervailable subsidies. For a discussion of evidence supporting our
initiation determination, see CVD Initiation Checklist.
We are including in our investigation the following programs
alleged in the Petition to provide countervailable subsidies to
producers/exporters of the subject merchandise:
A. Loan Programs
1. Policy Loans to Narrow Woven Ribbon Producers From State-
Owned Commercial Banks
B. Grant Programs
2. The State Key Technology Renovation Project Fund
3. Famous Brands Program
4. Export Assistance Grants
5. Export Interest Subsidy Funds for Enterprises Located in
Zhejiang Province
6. Technology Grants for Enterprises Located in Zhejiang
Province
C. Income and Other Direct Tax Programs
7. Preferential Tax Policies for Enterprises with Foreign
Investment (``Two Free Three Half'') Program
8. Tax Subsidies to FIEs in Specially Designated Areas
9. Preferential Tax Policies for Export-Oriented FIEs
10. Corporate Income Tax Refund Program for Reinvestment of FIE
Profits in Export-Oriented Enterprises
11. Local Income Tax Exemption and Reduction Programs for
``Productive'' FIEs
12. Tax Program for High or New Technology FIEs
13. Preferential Tax Policies for Township Enterprises
14. Preferential Tax Policies for Research and Development for
FIEs
15. Tax Benefits for FIEs in Encouraged Industries that Purchase
Domestic Equipment
D. Indirect Tax and Tariff Exemption Programs
16. Import Tariff and VAT Exemptions for FIEs Using Imported
Technology and Equipment
17. Import Tariff and VAT Exemptions for Certain Domestic
Enterprises Using Imported Technology and Equipment
18. VAT Rebate for FIE Purchases of Domestically Produced
Equipment
For further information explaining why the Department is investigating
these programs, see CVD Initiation Checklist.
We are not including in our investigation the following programs
alleged to benefit producers/exporters of the subject merchandise in
the PRC:
1. Loan Guarantees to Narrow Woven Ribbon Producers from State-Owned
Commercial Banks
2. Export Loans
3. Loan Forgiveness
4. Loan Interest Forgiveness
5. Grants for High-Technology Equipment
6. Technology Development Grants for Enterprises Located in Wenzhou
Municipality
7. Grants to Loss-Making SOEs
8. Provision of Land Use Rights to SOEs for LTAR
9. Provision of Land Use Rights for LTAR in Certain Geographical
Regions
10. Provision of Yarn for LTAR
For further information explaining why the Department is not initiating
an investigation of these programs, see CVD Initiation Checklist.
Respondent Selection
For this investigation, the Department intends to select
respondents based on U.S. Customs and Border Protection (``CBP'') data
for U.S. imports under HTSUS numbers 5806.32.1020, 5806.32.1030,
5806.32.1050, and 5806.32.1060, the four HTSUS categories most specific
to the subject merchandise, during the POI. We intend to release the
CBP data under Administrative Protective Order (``APO'') to all parties
with access to information protected by APO within five days of the
announcement of the initiation of this investigation. Interested
parties may submit comments regarding the CBP data and respondent
selection within seven calendar days of publication of this notice. We
intend to make our decision regarding respondent selection within 20
days of publication of this notice. Interested parties must submit
applications for disclosure under APO in accordance with 19 CFR
351.305. Instructions for filing such applications may be found on the
Department's Web site at http://ia.ita.doc.gov/apo.
Distribution of Copies of the Petition
In accordance with section 702(b)(4)(A)(i) of the Act and 19 CFR
351.202(f), a copy of the public version of the Petition has been
provided to the representatives of the GOC. Because of the particularly
large number of producers/exporters identified in the Petition, the
Department considers the service of the public version of the Petition
to the foreign producers/exporters satisfied by the delivery of the
public version to the GOC, consistent with 19 CFR 351.203(c)(2).
ITC Notification
We have notified the ITC of our initiation, as required by section
702(d) of the Act.
Preliminary Determination by the ITC
The ITC will preliminarily determine, within 25 days after the date
on which it receives notice of the initiation, whether there is a
reasonable indication that imports of subsidized narrow woven ribbons
from the PRC materially injure, or threaten material injury to, a U.S.
industry. See section 703(a)(2) of the Act. A negative ITC
determination will result in the investigation being terminated; see
section 703(a)(1) of the Act. Otherwise, the investigation will proceed
according to statutory and regulatory time limits.
This notice is issued and published pursuant to section 777(i) of
the Act.
Dated: July 29, 2009.
Ronald K. Lorentzen,
Acting Assistant Secretary for Import Administration.
Appendix I
Scope of the 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;
Have embellishments, including but not limited to
appliqu[eacute], 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
[[Page 39302]]
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 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; 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.
[FR Doc. E9-18892 Filed 8-5-09; 8:45 am]
BILLING CODE 3510-DS-P