Polyethylene Terephthalate Film From Korea: Preliminary Results of Antidumping Duty New Shipper Review

DEPARTMENT OF COMMERCE

International Trade Administration

[A-580-807]

Polyethylene Terephthalate Film From Korea: Preliminary Results

of Antidumping Duty New Shipper Review

AGENCY: Import Administration, International Trade Administration,

Department of Commerce.

ACTION: Notice of preliminary results of antidumping duty new shipper

review.

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SUMMARY: In response to a request from one respondent, the Department

of Commerce (the Department) is conducting a new shipper review of the

antidumping duty order on polyethylene terephthalate film, sheet, and

strip (PET film) from the Republic of Korea. The review covers one

manufacturer/exporter of the subject merchandise to the United States

and the period June 1, 1997 through May 31, 1998. We preliminarily

determine that HSI Industries (HSI) did not sell subject merchandise

below normal value (NV) during the period of review. If these

preliminary results are adopted in our final results of review, we will

instruct the U.S. Customs Service to assess no antidumping duties for

HSI for the period covered by this new shipper review.

Interested parties are invited to comment on these preliminary

results. Parties who submit argument in this proceeding are requested

to submit with the argument: (1) a statement of issues and (2) a

summary of the arguments (no longer than five pages, including

footnotes).

EFFECTIVE DATE: May 10, 1999.

FOR FURTHER INFORMATION CONTACT: Michael J. Heaney or John Kugelman,

AD/CVD Enforcement Group III, Office 8, Import Administration,

International Trade Administration, U.S. Department of Commerce, 14th

Street and Constitution Avenue, N.W., Washington, D.C. 20230; telephone

(202) 482-4475/0649.

Applicable Statute

Unless otherwise indicated, all citations to the Tariff Act of

1930, as amended (the Act) are references to the provisions effective

January 1, 1995, the effective date of the amendments made to the Act

by the Uruguay Round Agreements Act. In addition, unless otherwise

indicated, all citations to the Department's regulations are to the

regulations codified at 19 CFR part 351 (1998).

SUPPLEMENTARY INFORMATION:

Background

On June 30, 1998 and July 1, 1998, the Department received requests

from HSI and Kohap, Ltd. (Kohap) for new shipper reviews pursuant to

section 751(a)(2) of the Act and Sec. 351.214(b) of the Department's

regulations. On July 16, 1998, we published the notice of initiation

for this new shipper review (63 FR 38371). On August 12, 1998, Kohap,

Ltd. (Kohap) withdrew its request for a new shipper review. On December

7, 1998, we postponed the preliminary results until May 12, 1999, and

rescinded the review with respect to Kohap (63 FR 67455).

Scope of the Review

Imports covered by this review are shipments of all gauges of raw,

pretreated, or primed polyethylene terephthalate film, sheet, and

strip, whether extruded or coextruded. The films excluded from this

review 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 (0.254 micrometers) thick. Roller transport cleaning film which

has at least one of its surfaces modified by the application of 0.5

micrometers of SBR latex has also been ruled as not within the scope of

the order.

PET film is currently classifiable under Harmonized Tariff Schedule

(HTS) subheading 3920.62.00.00. The HTS subheading is provided for

convenience and for U.S. Customs purposes. The written description

remains dispositive as to the scope of the product coverage.

The review covers the period June 1, 1997 through May 31, 1998. The

Department is conducting this review in accordance with section

751(a)(2)(B) of the Act, as amended.

Fair Value Comparisons

To determine whether sales of PET film in the United States were

made at less than fair value, we compared USP to the NV, as described

in the ``United States Price'' and ``Normal Value'' sections of this

notice. In accordance with section 777A(d)(2) of the Act, we calculated

monthly weighted-average prices for NV and compared these to individual

U.S. transactions.

United States Price (USP)

In calculating USP, the Department treated HSI's sales as export

price (EP) sales, because the merchandise was sold to unaffiliated U.S.

purchasers prior to the date of importation and constructed export

price (CEP) methodology was not otherwise indicated. See section 772(a)

of the Act.

EP was based on the delivered price to unaffiliated purchasers in

the United States. We made adjustments, where applicable, for Korean

inland freight, Korean brokerage charges, ocean freight, U.S. brokerage

charges, U.S. inland freight, and U.S. customs duties. We made an

addition to EP for duty drawback pursuant to section 772(c)(1)(B) of

the Act.

Normal Value (NV)

In order to determine whether there were sufficient sales of PET

film in the home market (HM) to serve as a viable basis for calculating

NV, we compared the volume of home market sales of PET film to the

volume of PET film sold in the United States, in accordance with

section 773(a)(1)(C) of the Act. HSI's aggregate volume of HM sales of

the foreign like product was greater than five percent of its

respective aggregate volume of U.S. sales of the subject merchandise.

Therefore, we have based NV on HM sales.

In accordance with section 773(a)(6) of the Act, we adjusted NV,

where appropriate, by deducting home market packing expenses and adding

U.S. packing expenses. We also adjusted NV for differences in credit

expenses and deducted inland freight.

Level of Trade

In accordance with section 773(a)(1)(B)(i) of the Act, to the

extent practicable, we determine NV based on sales in the comparison

market at the same level of trade (LOT) as the EP or CEP transaction.

The NV LOT is that of the starting price sales in the comparison market

or, when NV is based on CV, that of the sales from which we derive SG&A

expenses and profit. For EP, the U.S. LOT is also the level of the

starting price sale, which is usually from the exporter to the

importer. For CEP, it is the level of the constructed sale from the

exporter to the importer.

To determine whether NV sales are at a different LOT than EP or CEP

sales, we examine stages in the marketing process and selling functions

along the chain of distribution between the producer and the

unaffiliated customer. If the comparison market sales are at a

different LOT, and the difference affects price comparability, as

manifested in a pattern of consistent price differences between the

sales on which NV is based and comparison market sales at the LOT of

the export transaction, we make a LOT adjustment under section

773(a)(7)(A) of the Act. Finally, for CEP sales, if the NV level is

more remote

[[Page 25015]]

from the factory than the CEP level and there is no basis for

determining whether the differences in the levels between NV and CEP

affects price comparability, we adjust NV under section 773(A)(7)(B) of

the Act (the CEP offset provision). (See e.g., Certain Carbon Steel

Plate from South Africa, Final Determination of Sales at Less Than Fair

Value, 62 FR 61731 (November 19, 1997).)

In implementing these principles in this review, we asked HSI to

identify the specific differences and similarities in selling functions

and/or support services between all phases of marketing in the home

market and the United States. HSI identified two channels of

distribution in the home market: (1) Wholesalers/distributors and (2)

end-users. For both channels, HSI performs similar selling functions

such as order processing, delivery arrangement, and customer liaison.

Because channels of distribution do not qualify as separate levels of

trade when the selling functions performed for each customer class are

sufficiently similar, we determined that there exists one LOT for HSI's

home market sales.

For the U.S. market HSI reported one LOT: EP sales made directly to

its U.S. customers. When we compared EP sales to home market sales, we

determined that sales in both markets were made at the same LOT. For

both EP and home market transactions HSI sold directly to the customer

and provided similar levels of order processing, delivery arrangement,

and customer liaison. Based upon the foregoing, we determined that HSI

sold at the same LOT in the U.S. as it did in the home market, and

consequently no LOT adjustment is warranted.

Preliminary Results of Review

We preliminarily determine that a margin of 0.00 percent exists for

HSI for the period June 1, 1997 through May 31, 1998. We will disclose

calculations performed in connection with this preliminary results of

review within 10 days after the date of any public announcement, or if

there is no public announcement within 5 days of publication of this

notice. Interested parties may submit case briefs and/or written

comments no later than 30 days after the date of publication. Rebuttal

briefs and rebuttals to written comments, limited to issues raised in

such briefs or comments, may be filed no later than 5 days after the

deadline for filing case briefs. Any interested party may request a

hearing within 30 days of publication. Any hearing, if requested, will

be held 2 days after the deadline for filing rebuttal briefs unless the

Secretary alters the date. The Department will issue the final results

of this administrative review, which will include the results of its

analysis of issues raised in any such written comments or at a hearing,

within 90 days after the date of these preliminary results.

Upon completion of this new shipper administrative review, the

Department shall determine, and Customs shall assess, antidumping

duties on all appropriate entries. We have calculated importer-specific

ad valorem duty assessment rates based on the total amount of

antidumping duties calculated for the examined sales as a percentage of

the total value of subject merchandise entered during the POR. These

rates will be assessed uniformly on all entries made during the POR.

The Department will issue appraisement instructions directly to

Customs. The final results of this review shall be the basis for the

assessment of antidumping duties on entries of merchandise covered by

the determination and for future deposits of estimated duties.

Upon completion of this review, the posting of a bond, or security

in lieu of cash deposit, pursuant to section 751(a)(2)(B)(iii) of the

Act and Sec. 351.214(e) of the Department's regulations will no longer

be permitted and, should the final results yield a margin of dumping, a

cash deposit will be required for each entry of the merchandise.

Furthermore, the following deposit requirements will be effective

upon completion of the final results of this new shipper review for all

shipments of PET film from the Republic of Korea 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)(1) of the Act: (1) the cash deposit rate for HSI will be the

rate established in the final results of this new shipper review; (2)

for merchandise exported by manufacturers or exporters not covered in

this review but covered in the less than fair value (LTFV)

investigation or a previous review, the cash deposit will continue to

be the most recent rate published in the final determination or final

results for which the manufacturer or exporter received a company-

specific rate; (3) if the exporter is not a firm covered in this review

or the original investigation, but the manufacturer is, the cash

deposit rate will be that established for the manufacturer of the

merchandise in the final results of this review or the LTFV

investigation; and (4) if neither the exporter nor the manufacturer is

a firm covered in this or any previous reviews, the cash deposit rate

will be 21.5%, the ``all others'' rate established in the LTFV

investigation.

This notice also serves as a preliminary reminder to importers of

their responsibility under 19 CFR 351.402(f) 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 and notice are in accordance with section

751(a)(2)(B) of the Act 19 CFR 351.214(d).

Dated: May 3, 1999.

Robert S. LaRussa,

Assistant Secretary for Import Administration.

[FR Doc. 99-11724 Filed 5-7-99; 8:45 am]

BILLING CODE 3510-DS-P