[Federal Register: June 18, 2004 (Volume 69, Number 117)]
[Notices]               
[Page 34122-34125]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr18jn04-57]                         

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DEPARTMENT OF COMMERCE

International Trade Administration

[A-549-821]

 
Notice of Final Determination of Sales at Less Than Fair Value: 
Polyethylene Retail Carrier Bags From Thailand

AGENCY: Import Administration, International Trade Administration, 
Department of Commerce.

EFFECTIVE DATE: June 18, 2004.

SUMMARY: On January 26, 2003, the Department of Commerce published its 
preliminary determination of sales at less than fair value of the 
investigation on polyethylene retail carrier bags from Thailand. The 
period of investigation is April 1, 2002, through March 31, 2003. The 
investigation covers five manufacturers/exporters.
    We invited interested parties to comment on our preliminary 
determination of sales at less than fair value. Based on our analysis 
of the comments received, we have made changes to our calculations. The 
final dumping margins for this investigation are listed in the ``Final 
Determination Margins'' section below.

FOR FURTHER INFORMATION CONTACT: Lyn Johnson (TPBG) or Fred Aziz 
(Universal), Import Administration, International Trade Administration, 
U.S. Department of Commerce, 14th Street and Constitution Avenue, NW.,

[[Page 34123]]

Washington, DC 20230; telephone: (202) 482-4733.

Final Determination

    The Department of Commerce (the Department) has conducted this 
antidumping investigation in accordance with section 735 of the Tariff 
Act of 1930, as amended (the Act). We have determined that polyethylene 
retail carrier bags (PRCBs) from Thailand are being sold, or are likely 
to be sold, in the United States at less than fair value (LTFV), as 
provided in section 735 of the Act. The estimated margins of sales at 
LTFV are shown in the ``Final Determination Margins'' section of this 
notice.

Case History

    The preliminary determination of sales at LTFV in this 
investigation was issued on January 21, 2004. See Notice of Preliminary 
Determination of Sales at Less Than Fair Value and Postponement of 
Final Determination: Polyethylene Retail Carrier Bags from Thailand, 69 
FR 3552 (January 26, 2004) (Preliminary Determination).
    Since the Preliminary Determination the following events have 
occurred. In February 2004, we conducted verifications of the 
questionnaire responses of the respondents, Thai Plastic Bags 
Industries Co., Ltd. (TPBI), Winner's Pack Co., Ltd., and APEC Film Ltd 
(APEC) (collectively the Thai Plastic Bags Industries Group (TPBG)), 
and Advance Polybag Inc., Alpine Plastics Inc., API Enterprises Inc., 
and Universal Polybag Co., Ltd. (collectively Universal). We gave 
interested parties an opportunity to comment on the Preliminary 
Determination. We received case briefs on April 30, 2004, from the 
respondents and May 3, 2004, from the Polyetheylene Retail Carrier Bag 
Committee and its individual members, PCL Packing, Inc., Hilex Poly 
Co., LLC, Superbag Corp., Vanguard Plastics Inc., and Inteplast Group, 
Ltd. (collectively, the petitioners). We received rebuttal briefs on 
May 6, 2004, from both the respondents and the petitioners. The 
Department held a public hearing on May 14, 2004, at the request of the 
petitioners.

Period of Investigation

    The period of investigation (POI) corresponds to the four most 
recent fiscal quarters prior to the filing of the petition, April 1, 
2002, through March 31, 2003.

Scope of Investigation

    The merchandise subject to this investigation is PRCBs, 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 .035 
inch (0.889 mm) and no less than .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 the petition excludes (1) PRCBs that are not 
printed with logos or store names and that are closeable with 
drawstrings made of polyethylene film and (2) PRCBs 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 the subject merchandise are currently classifiable under 
statistical category 3923.21.0090 of the Harmonized Tariff Schedule of 
the United States. This subheading also covers products that are 
outside the scope of this investigation. Furthermore, although the 
HTSUS subheading is provided for convenience and customs purposes, our 
written description of the scope of this investigation is dispositive.

Analysis of Comments Received

    All issues raised in the case and rebuttal briefs by parties to 
this antidumping investigation are addressed in the ``Issues and 
Decision Memorandum'' (Decision Memorandum) from Jeffrey May, Deputy 
Assistant Secretary, Import Administration, to James J. Jochum, 
Assistant Secretary for Import Administration, dated June 9, 2004, 
which is hereby adopted by this notice. A list of the issues which 
parties have raised and to which we have responded, all of which are in 
the Decision Memorandum, is attached to this notice as an appendix. 
Parties can find a complete discussion of all issues raised in this 
investigation and the corresponding recommendations in this public 
memorandum which is on file in the Central Records Unit, room B-099 of 
the main Department of Commerce building. In addition, a complete 
version of the Decision Memorandum can be accessed directly on the Web 
at http://ia.ita.doc.gov/. The paper copy and electronic version of the 

Decision Memorandum are identical in content.

Use of Facts Otherwise Available

    Section 776(a)(2) of the Act provides that, if an interested party 
withholds information that has been requested by the Department, fails 
to provide such information in a timely manner or in the form or manner 
requested, significantly impedes a proceeding under the antidumping 
statute, or provides such information but the information cannot be 
verified, the Department shall, subject to sections 782(d) and (e) of 
the Act, use facts otherwise available in reaching the applicable 
determination.
    Specifically, section 776(a)(2)(B) of the Act requires the 
Department to use facts available when a party does not provide the 
Department with information by the established deadline or in the form 
and manner requested by the Department. In addition, section 776(b) of 
the Act provides that, if the Department finds that an interested party 
``has failed to cooperate by not acting to the best of its ability to 
comply with a request for information,'' the Department may use 
information that is adverse to the interests of that party as facts 
otherwise available.
    As explained in the Preliminary Determination, Champion Paper 
Polybags Ltd., TRC Polypack, and Zip-Pac Co., Ltd., failed to respond 
to our July 14, 2003, request for information. See Preliminary 
Determination at 69 FR 3552. Consistent with our decision in the 
Preliminary Determination and pursuant to section 776(a) of the Act, in 
reaching our final determination we have used total facts available for 
all three of these companies. These firms did not provide the data we 
needed to decide whether they should be selected as mandatory 
respondents. Also, because these companies failed to respond to our 
requests for information, we have found that they failed to cooperate 
to the best of their ability. Therefore, pursuant to section 776(b) of 
the Act, we have used an adverse inference in selecting from the facts 
available for the margins for these companies. Accordingly, we find 
that the highest margin based on petition information, as we adjusted 
for the initiation of this investigation, 122.88 percent, is 
corroborated within the meaning of section 776(c) of the Act. See 
Initiation of Antidumping Duty Investigations: Polyethylene Retail 
Carrier Bags from The People's Republic of China, Malaysia, and 
Thailand, 68 FR 42002 (July 16, 2003).

[[Page 34124]]

    Section 776(c) of the Act provides that the Department shall, to 
the extent practicable, corroborate secondary information used for 
facts available by reviewing independent sources reasonably at its 
disposal. Information from the petitioners constitutes secondary 
information. The Statement of Administrative Action accompanying the 
Uruguay Round Agreements Act, H.R. Doc. 103-316, at 870 (1994) (SAA), 
provides that the word ``corroborate'' means that the Department will 
satisfy itself that the secondary information used has probative value.
    As discussed in the memorandum to the file entitled ``Corroboration 
of Facts Available'', dated January 16, 2004, we found that the export-
price (EP) and normal-value information in the petition were reasonable 
and, therefore, determined that the petition information has probative 
value. Furthermore, there is no information on the record that 
demonstrates that the rate we have selected is an inappropriate total 
adverse facts-available rate for the companies in question. On the 
contrary, our existing record supports the use of this rate as the 
dumping margin for these firms. Therefore, we consider the selected 
rate to have probative value with respect to the firms in question and 
to reflect the appropriate adverse inference. Accordingly, for the 
final determination, the margin for Champion Paper Polybags Ltd., TRC 
Polypack, and Zip-Pac Co., Ltd., is 122.88 percent.

Currency Conversion

    We made currency conversions into U.S. dollars in accordance with 
section 773A(a) of the Act based on the exchange rates in effect on the 
dates of the U.S. sales as certified by the Federal Reserve Bank.

Cost of Production

    As explained in our ``Request to Initiate a Cost Investigation'' 
dated November 21, 2003, we conducted a COP investigation of sales by 
TPBG in the home market pursuant to section 773(b)(1) of the Act.
    In accordance with section 773(b)(3) of the Act, we calculated the 
cost of production (COP) based on the sum of the costs of materials and 
fabrication employed in producing the foreign like product, the 
selling, general and administrative (SG&A) expenses, and all costs and 
expenses incidental to packing the merchandise. In our COP analysis, we 
used the home-market sales and COP information provided in TPBG's 
questionnaire responses.
    After calculating the COP, in accordance with section 773(b)(1) of 
the Act, we tested whether home-market sales of the foreign like 
product were made at prices below the COP within an extended period of 
time in substantial quantities and whether such prices permitted the 
recovery of all costs within a reasonable period of time. We compared 
model-specific COPs to the reported home-market prices less any 
applicable movement charges.
    Pursuant to section 773(b)(2)(C) of the Act, when less than 20 
percent of TPBG's sales of a given product were at prices less than the 
COP, we did not disregard any below-cost sales of that product because 
the below-cost sales were not made in substantial quantities within an 
extended period of time. When 20 percent or more of a respondent's 
sales of a given product during the POI were at prices less than the 
COP, we disregarded the below-cost sales because they were made in 
substantial quantities within an extended period of time pursuant to 
sections 773(b)(2)(B) and (C) of the Act and because, based on 
comparisons of prices to weighted-average COPs for the POI, we 
determined that these sales were at prices which would not permit 
recovery of all costs within a reasonable period of time in accordance 
with section 773(b)(2)(D) of the Act. Based on this test, in the 
Preliminary Determination and for this final determination, we 
disregarded below-cost sales with respect to TPBG.

Verification

    As provided in section 782(i) of the Act, we verified the 
information submitted by the respondents for use in our final 
determination. We used standard verification procedures, including 
examination of relevant accounting and production records, as well as 
original source documents provided by respondents.

Changes Since the Preliminary Determination

    Since the Preliminary Determination, we have made the following 
changes to our margin calculations:

TPBG

    1. We incorporated pre-verification changes by using the revised 
U.S., home-market, and cost-of-production sales listings provided in 
TPBG's February 2, 2004, filing.
    2. We adjusted TPBG's reported U.S., home-market, and cost sales 
listings for corrections presented on the first day of the cost 
verification (see the cost verification report for TPBG dated March 31, 
2004) and the first day of the sales verification (see the sales 
verification report dated April 15, 2004).
    3. We adjusted TPBG's reported cost of inputs obtained from 
affiliates to reflect the higher of transfer price or market price in 
accordance with section 773(f)(2) of the Act. See Comment 5 of the 
Decision Memorandum.
    4. We adjusted APEC's reported costs for an unreconciled difference 
between the total costs from the financial accounting system and the 
total costs from the cost of production (COP) and constructed value 
(CV) file. See Comment 14 of the Decision Memorandum.
    5. We adjusted TPBI's reported costs for an unreconciled difference 
between the total costs from the financial accounting system and the 
total costs from the COP and CV file. See Comment 10 of the Decision 
Memorandum.
    6. We adjusted TPBI's reported costs for a difference in the 
production quantities from the production system and those used to 
calculate the per-unit costs. See Comment 10 of the Decision 
Memorandum.
    7. We adjusted TPBI's general and administrative (G&A) rate for a 
mathematical error. We also adjusted Winner's Pack's financial expense 
rate for a mathematical error. See Comment 14 of the Decision 
Memorandum.
    8. We adjusted APEC's financial expense rate to disallow interest 
income offsets not related to short-term assets. See Comment 13 of the 
Decision Memorandum.
    9. We made adjustments to U.S. price to account for two of the 
three types of duty drawback claims reported. See Comment 8 of the 
Decision Memorandum.
    10. We revised the amount for indirect selling expenses (ISEs) 
incurred in Thailand as a result of verification. We also revised the 
home-market ISEs as a result of verification and calculation errors 
asserted by the petitioners. See Comment 15 of the Decision Memorandum.
    See ``Final Determination Analysis Memorandum for Thai Plastic Bags 
Group,'' memorandum to the file dated June 9, 2004, and ``Constructed 
Value Calculation Adjustments for Thai Plastic Bags Group for the Final 
Determination,'' Memorandum to the File from the Office of Accounting, 
dated June 9, 2004, for more details concerning the above changes.

Universal

    1. We imputed interest expense for a certain loan. For the final 
determination, we applied the interest rate in Thailand, as published 
by the International Monetary Fund, to the average daily loan balance 
of the loan, based on the actual number of days that

[[Page 34125]]

the principal amount of the loan was outstanding, to calculate the 
imputed interest expense. See Comment 7 of the Decision Memorandum.
    2. We increased the total cost of manufacture to value affiliated-
party inputs of masterbatch (color concentrate) at the higher of 
transfer price or market price. See Comment 5 of the Decision 
Memorandum.
    3. We adjusted the reported costs to include unreconciled 
differences and other adjustments, found at verification, in the 
reconciliations of the financial statements to the financial accounting 
system and of the financial accounting system to the reported costs for 
the POI. See Memorandum from Nancy Decker through Theresa Caherty to 
Neal Halper, ``Universal Polybag Co., Ltd. Constructed Value 
Calculation Adjustments for the Final Determination'' dated June 9, 
2004 (Universal Final Cost Memorandum).
    4. We adjusted general and administrative (G&A) and financial 
expenses ratios to remove packing from the denominator of the 
calculation of these ratios. We then applied G&A and financial expenses 
to the total packing-exclusive cost of manufacturing.
    5. We have recalculated the rates used for CV selling expenses and 
CV profit. See Comment 4 of the Decision Memorandum.
    See the ``Final Determination Analysis Memorandum for Universal 
Polybag,'' Memorandum to the File, dated June 9, 2004, and 
``Constructed Value Calculation Adjustments for Universal Polybag Co., 
Ltd. for the Final Determination,'' Memorandum to the File from the 
Office of Accounting dated June 9, 2004, for more details concerning 
the above changes.

Continuation of Suspension of Liquidation

    Pursuant to 735(c)(1)(B) of the Act, we will instruct U.S. Customs 
and Border Protection (CBP) to continue to suspend liquidation of all 
entries of subject merchandise from Thailand, except for subject 
merchandise produced and exported by TPBG (which has a de minimis 
weighted-average margin) entered, or withdrawn from warehouse, for 
consumption on or after January 26, 2004, the date of the publication 
of our preliminary determination. CBP shall continue to require a cash 
deposit or the posting of a bond equal to the estimated amount by which 
the normal value exceeds the U.S. price as shown below. These 
instructions suspending liquidation will remain in effect until further 
notice.

Final Determination Margins

    The weighted-average dumping margins are as follows:

------------------------------------------------------------------------
                                                              Weighted-
                                                               average
                   Exporter/manufacturer                      percentage
                                                                margin
------------------------------------------------------------------------
TPBG.......................................................         0.62
Universal..................................................         5.66
Champion Paper Polybags Ltd................................       122.88
TRC Polypack...............................................       122.88
Zip-Pac Co., Ltd...........................................       122.88
All Others.................................................         5.66
------------------------------------------------------------------------

    Pursuant to section 735(c)(5)(A) of the Act, we have excluded from 
the calculation of the all-others rate margins which are zero or de 
mimimis or determined entirely on facts available. See ``Antidumping 
Duty Investigation on Polyethylene Retail Carrier Bags from Thailand--
Analysis Memo for All-Others Rate,'' dated June 9, 2004. The Department 
will disclose calculations performed within five days of publication of 
this notice to parties in this proceeding in accordance with 19 CFR 
351.224(b).

International Trade Commission Notification

    In accordance with section 735(d) of the Act, we have notified the 
International Trade Commission (ITC) of our determination of sales at 
LTFV. As our final determination is affirmative and in accordance with 
section 735(b) of the Act the ITC will determine, within 45 days, 
whether the domestic industry in the United States is materially 
injured, or threatened with material injury, by reason of imports, or 
sales (or the likelihood of sales) for importation, of the subject 
merchandise. If the ITC determines that material injury or threat of 
material injury does not exist, the proceeding will be terminated and 
all securities posted will be refunded or canceled. If the ITC 
determines that such injury does exist, the Department will issue an 
antidumping duty order directing CBP to assess antidumping duties on 
all imports of the subject merchandise entered, or withdrawn from 
warehouse, for consumption on or after the effective date of the 
suspension of liquidation.

Notification Regarding APO

    This notice also serves as a 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. 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 determination is issued and published in accordance with 
sections 735(d) and 777(i)(1) of the Act.

    Dated: June 9, 2004.
James J. Jochum,
Assistant Secretary for Import Administration.

Issues Appendix

1. Foreign and Domestic Production
2. Allocation of Indirect Selling Expenses
3. Date of Sale
4. Surrogate-Value Information
5. Affiliated-Party Inputs
6. Inputed Interest on Long-Term Loans
7. Duty Drawback
8. Affiliations
9. Miscellaneous Cost Issues
10. Pre-Verification and Verification Corrections

[FR Doc. 04-13814 Filed 6-17-04; 8:45 am]
BILLING CODE 3510-DS-P