[Federal Register Volume 75, Number 62 (Thursday, April 1, 2010)]
[Notices]
[Pages 16428-16431]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-7395]
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DEPARTMENT OF COMMERCE
International Trade Administration
[C-552-805]
Polyethylene Retail Carrier Bags from the Socialist Republic of
Vietnam: Final Affirmative Countervailing Duty Determination
AGENCY: Import Administration, International Trade Administration,
Department of Commerce.
SUMMARY: The Department of Commerce (Department) has determined that
countervailable subsidies are being provided to producers and exporters
of polyethylene retail carrier bags (PRCBs) from the Socialist Republic
of Vietnam (Vietnam). For information on the estimated countervailing
duty rates, please see the ``Suspension of Liquidation'' section,
below.
DATES: Effective Date: April 1, 2010.
FOR FURTHER INFORMATION CONTACT: Gene Calvert or Jun Jack Zhao, 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-
3586 and (202) 482-1396, respectively.
Case History
The following events have occurred since the announcement of the
preliminary determination, which was published in the Federal Register
on September 4, 2009. See Polyethylene Retail Carrier Bags from the
Socialist Republic of Vietnam: Preliminary Affirmative Countervailing
Duty Determination and Alignment of Final Countervailing Duty
Determination with
[[Page 16429]]
Final Antidumping Duty Determination, 74 FR 45811 (September 4, 2009)
(Preliminary Determination).
The Department issued a second supplemental questionnaire to the
government of Vietnam (GOV), Advance Polybag Co., Ltd. (API), Chin
Sheng Company, Ltd. (Chin Sheng), and Fotai Vietnam Enterprise
Corporation and Fotai Enterprise Corporation (collectively, Fotai). The
Department received responses to these questionnaires on October 7,
2009 from API, on October 14 from Chin Sheng and the GOV, and on
October 16 from Fotai. A third supplemental questionnaire was
subsequently issued to the GOV only. The GOV submitted a response on
October 26. Public versions of the questionnaires and responses, as
well as the various memoranda cited below, are available at the
Department's Central Records Unit (Room 1117 in the HCHB Building)
(hereafter referred to as ``CRU''). Also on October 26, new factual
information was submitted by Hilex Poly Co., LLC and Suberbag
Corporation (collectively, Petitioners), the GOV, and Fotai. On October
21, 2009, the Department was informed by API that it was no longer
participating in the investigation. See the October 21, 2009 Letter to
the Secretary of Commerce, ``Countervailing Duty Investigation
Involving Polyethylene Retail Carrier Bags from Vietnam.''
From November 2 through November 18, 2009, we conducted
verification of the questionnaire responses submitted by the GOV, Chin
Sheng and Fotai. We issued verification reports on January 4, 2010. See
Memorandum to the File, ``Verification of the Questionnaire Responses
Submitted by the Government of Vietnam,'' and Memoranda to Mark
Hoadley, Program Manager, AD/CVD Operations, Office 6, ``Verification
of the Questionnaire Responses Submitted by Chin Sheng Company, Ltd.,''
and ``Verification of the Questionnaire Responses Submitted by Fotai
Vietnam Enterprise Corporation.'' On January 11, 2010, we issued a
report regarding discussions held with third party experts concerning
banking in Vietnam. See Memorandum to Barbara E. Tillman, Director, AD/
CVD Operations, Office 6, ``Private Experts Meeting on Vietnam's
Banking Sector.''
We received case briefs from Petitioners, the GOV, Chin Sheng and
Fotai on January 25, 2010, and rebuttal briefs from Petitioners, the
GOV, and Fotai on February 1, 2010. On January 27, 2010, Petitioners
withdrew their request for a hearing, submitted on October 5, 2009.
On February 12, 2010, the Department exercised its discretion to
toll Import Administration deadlines for the duration of the closure of
the Federal Government from February 5 through February 12, 2010. Thus,
all deadlines in this segment of the proceeding were extended by seven
days. See Memorandum to the Record from Ronald Lorentzen, Deputy
Assistant Secretary for Import Administration, regarding ``Tolling of
Administrative Deadlines As a Result of the Government Closure During
the Recent Snowstorm,'' dated February 12, 2010.'' Based on this
memorandum, the deadline for this final determination was changed from
March 18, 2010 to March 25, 2010.
Scope of the Investigation
The scope of this investigation covers polyethylene retail carrier
bags, which also may be referred to as t-shirt sacks, merchandise bags,
grocery bags, or checkout bags. The subject merchandise is defined as
non-sealable sacks and bags with handles (including drawstrings),
without zippers or integral extruded closures, with or without gussets,
with or without printing, of polyethylene film having a thickness no
greater than 0.035 inch (0.889 mm) and no less than 0.00035 inch
(0.00889 mm), and with no length or width shorter than 6 inches (15.24
cm) or longer than 40 inches (101.6 cm). The depth of the bag may be
shorter than 6 inches but not longer than 40 inches (101.6 cm).
PRCBs are typically provided without any consumer packaging and
free of charge by retail establishments, e.g., grocery, drug,
convenience, department, specialty retail, discount stores, and
restaurants to their customers to package and carry their purchased
products. The scope of this investigation excludes (1) polyethylene
bags that are not printed with logos or store names and that are
closeable with drawstrings made of polyethylene film and (2)
polyethylene bags that are packed in consumer packaging with printing
that refers to specific end-uses other than packaging and carrying
merchandise from retail establishments, e.g., garbage bags, lawn bags,
trash-can liners.
Imports of merchandise included within the scope of this
investigation are currently classifiable under statistical category
3923.21.0085 of the Harmonized Tariff Schedule of the United States
(HTSUS). This subheading may also cover products that are outside the
scope of this investigation. Furthermore, although the HTSUS subheading
is provided for convenience and customs purposes, the written
description of the scope of this investigation is dispositive.
Injury Test
Because Vietnam is a ``Subsidies Agreement Country'' within the
meaning of section 701(b) of the Tariff Act of 1930, as amended (the
Act), the International Trade Commission (ITC) is required to determine
pursuant to section 701(a)(2) of the Act whether imports of the subject
merchandise from Vietnam materially injure, or threaten material injury
to, a United States industry. On May 29, 2009, the ITC published its
preliminary determination that there is a reasonable indication that an
industry in the United States is materially injured by reason of
allegedly subsidized imports from Vietnam of subject merchandise. See
Polyethylene Retail Carrier Bags From Indonesia, Taiwan, and Vietnam;
Determinations, 74 FR 25771 (May 29, 2009); and Polyethylene Retail
Carrier Bags From Indonesia, Taiwan, and Vietnam (Preliminary), USITC
Pub. 4080, Inv. Nos. 701-TA-462 and 731-TA-1156-1158 (May 2009).
Period of Investigation
The period for which we are measuring subsidies, i.e., the period
of investigation (POI), is January 1, 2008 through December 31, 2008.
Analysis of Comments Received
All issues raised in the case and rebuttal briefs submitted by
Petitioners, the GOC, Chin Sheng and Fotai are addressed in the
Memorandum to Ronald K. Lorentzen, Deputy Assistant Secretary for
Import Administration, ``Issues and Decision Memorandum for the Final
Determination in the Countervailing Duty Investigation of Polyethylene
Retail Carrier Bags from the Socialist Republic of Vietnam'' (March 25,
2010) (hereafter referred to as the ``Decision Memorandum''), which is
hereby adopted by this notice. Attached to this notice as an Appendix
is a list of the issues that parties have raised and to which we have
responded in the Decision Memorandum. Parties can find this public
memorandum in the Department's CRU. In addition, a complete version of
the Decision Memorandum can be accessed directly on the internet at
http://ia.ita.doc.gov/ia-highlights-and-news.html or http://ia.ita.doc.gov/frn/. The paper copy and electronic version of the
Decision Memorandum are identical in content.
Application of Adverse Facts Available
For purposes of this final determination, we relied on adverse
facts available (AFA) in accordance with sections 776(a) and (b) of the
Act to determine the total countervailable subsidy rate for API. We
also relied on
[[Page 16430]]
AFA to determine the countervailable subsidy rate for Fotai for one of
the programs under investigation. A full discussion of our decision to
apply AFA is presented in the Decision Memorandum in the section
``Application of Facts Otherwise Available and AFA to API and Fotai.''
Suspension of Liquidation
In accordance with section 705(c)(1)(B)(i)(I) of the Act, we have
calculated an individual rate for Chin Sheng and Fotai, and assigned an
AFA rate to API. Section 705(c)(5)(A)(i) of the Act states that for
companies not investigated, we will determine an all others rate equal
to the weighted average countervailable subsidy rates established for
exporters and producers individually investigated, excluding any zero
and de minimis countervailable subsidy rates, and any rates based
entirely on AFA under section 776 of the Act. Since API's rate is based
entirely on AFA and since Chin Sheng's rate is de minimis, the all
others rate is the rate calculated for Fotai.
------------------------------------------------------------------------
Net Subsidy
Producer/Exporter Rate
------------------------------------------------------------------------
Advance Polybag Co., Ltd................................ 52.56[percnt]
Chin Sheng Company, Ltd................................. 0.44[percnt]
(de minimis)
Fotai Vietnam Enterprise Corp. And Fotai Enterprise 5.28[percnt]
Corporation............................................
All Others.............................................. 5.28[percnt]
------------------------------------------------------------------------
Although suspension of liquidation was required on the date of
publication of the Preliminary Determination, we subsequently
instructed U.S. Customs and Border Protection, pursuant to section
703(d) of the Act, to discontinue the suspension of liquidation for
countervailing duty purposes for subject merchandise entered on or
after January 2, 2010, but to continue the suspension of liquidation of
entries made on or after September 4, 2009 through January 1, 2010.
If the ITC issues a final affirmative injury determination, we will
issue a countervailing duty order and reinstate the suspension of
liquidation under section 706(a) of the Act. We will then require a
cash deposit of estimated countervailing duties for entries of subject
merchandise in the amounts indicated above, except for Chin Sheng,
which would be excluded from an order because it has a de minimis rate.
This exclusion will apply only to subject merchandise both produced and
exported by Chin Sheng. If the ITC determines that material injury, or
threat of material injury, does not exist, this proceeding will be
terminated and all estimated duties deposited or securities posted as a
result of the suspension of liquidation will be refunded or canceled.
ITC Notification
In accordance with section 705(d) of the Act, we will notify the
ITC of our determination. In addition, we are making available to the
ITC all non-privileged and non-proprietary information related to this
investigation. We will allow the ITC access to all privileged and
business proprietary information in our files, provided the ITC
confirms that it will not disclose such information, either publicly or
under an Administrative Protective Order (APO), without the written
consent of the Assistant Secretary for Import Administration.
Return or Destruction of Proprietary Information
In the event that the ITC issues a final negative injury
determination, this notice will serve as the only reminder to parties
subject to an APO of their responsibility concerning the destruction of
proprietary information disclosed under APO in accordance with 19 CFR
351.305(a)(3). Timely written notification of the return/destruction of
APO materials or conversion to judicial protective order is hereby
requested. Failure to comply with the regulations and terms of an APO
is a violation which is subject to sanction.
This determination is issued and published pursuant to sections
705(d) and 777(i) of the Act.
Dated: March 25, 2010.
Ronald K. Lorentzen,
Deputy Assistant Secretary for Import Administration.
Appendix
Issues and Decision Memorandum
I. Summary
II. Background
III. Applicability of the CVD Law to Vietnam
IV. Subsidies Valuation
A. Period of Investigation
B. Date of Applicability of CVD Law to Vietnam
C. Allocation Period
D. Loan Benchmark and Discount Rates
E. Attribution of Subsidies - Sales Denominator
V. Application of Facts Otherwise Available and AFA for API and Fotai
A. API
B. Fotai
C. Corroboration
VI. Analysis of Programs
A. Programs Determined To Be Countervailable
1. Income Tax Preferences for Encouraged Industries
2. Income Tax Preferences for FIEs
3. Land Rent Reduction or Exemption for Exporters
4. Import Duty Exemptions for Imported Raw Materials for Exported
Goods
5. Exemption of Import Duties on Imports of Spare Parts and
Accessories for Industrial Zone Enterprises
B. Programs Determined To Be Not Countervailable
VAT Exemptions for Equipment for FIEs
C. Programs Determined To Be Terminated
Export Bonus Program
D. Programs Determined To Have Been Not Used During the Period of
Investigation
1. Government Provision of Water for LTAR in Industrial Zones
2. Preferential Lending for Exporters
3. Preferential Lending for the Plastics Industry
4. Export Promotion Program
5. New Product Development Program
6. Income Tax Preferences for Exporters
7. Income Tax Preferences for FIEs Operating in Encouraged
Industries
8. Import Tax Exemptions for FIEs Using Imported Goods to Create
Fixed Assets
9. Exemption of Import Duties on Importation of Fixed Assets for
Industrial Zone Enterprises
10. Import Tax Exemptions for FIEs Importing Raw Materials
11. Land Rent Exemption for Manufacturers of Plastic Products
12. Provision of Land Use Rights in Industrial Zones for LTAR
13. Land Rent Reduction or Exemption for FIEs
14. Exemption of Import Duties for Imported Raw Materials for
Industrial Zone Enterprises
15. Accelerated Depreciation for Companies in Encouraged Industries
and Industrial Zones
16. Losses Carried Forward for Companies in Encouraged Industries
and Industrial Zones
VII. Analysis of Comments
Comment 1: Simultaneous Imposition of CVD and AD Duties on an NME
Comment 2: The Appropriate De Minimis Rate
Comment 3: Cutoff Date for Countervailing Duties
[[Page 16431]]
Comment 4: Preferential Lending for the Plastics Industry
Comment 5: Chin Sheng's Policy Lending Rate Should Be Recalculated
Using the Data Collected at Verification
Comment 6: Fotai's Short-Term Loan Data Were Not Verified
Comment 7: Proper Benchmark for Preferential Lending
Comment 8: The Provision of Land at LTAR
Comment 9: The Proper Benchmark for the Provision of Land at LTAR
Comment 10: Duty Exemptions on Imports of Raw Materials Provided to
Fotai
Comment 11: Chin Sheng's Sales Denominator
Comment 12: Income Tax Programs and Programs Not Used
Comment 13: Application of AFA to API
VIII. Recommendation
[FR Doc. 2010-7395 Filed 3-31-10; 8:45 am]
BILLING CODE 3510-DS-S