Certain Cased Pencils From the People's Republic of China; Final Results and Partial Rescission of Antidumping Duty Administrative Review

AGENCY:

Import Administration, International Trade Administration, Department of Commerce.

ACTION:

Notice of final results and partial rescission of antidumping duty administrative review.

SUMMARY:

On January 13, 2004, the Department of Commerce (the Department) published in the Federal Register the preliminary results and rescission in part of the 2001-2002 administrative review of the antidumping duty order on certain cased pencils (pencils) from the People's Republic of China (PRC). The period of review (POR) is December 1, 2001, through November 30, 2002. We have now completed the 2001-2002 administrative review of the order. In our final results, based on our analysis of comments received, we amended the preliminary results of review. For details regarding these changes, see the section of this notice entitled “Changes Since the Preliminary Results.” The final results are listed below in the “Final Results of Review” section.

DATES:

Effective Date: May 21, 2004.

FOR FURTHER INFORMATION CONTACT:

Paul Stolz, Christopher Zimpo, or Magd Zalok, AD/CVD Enforcement, Office 4, Group II, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, NW., Washington, DC, 20230; telephone (202) 482-4474, (202) 482-2747 and (202) 482-4162, respectively.

SUPPLEMENTARY INFORMATION:

Background

On January 13, 2004, the Department published in the Federal Register the preliminary results and rescission in part of the administrative review of the antidumping duty order on pencils from the PRC. See Certain Cased Pencils from the People's Republic of China; Preliminary Results and Rescission in Part of Antidumping Duty Administrative Review, 69 FR 1965 (January 13, 2004) (Preliminary Results). We invited parties to comment on our Preliminary Results. On February 17, 2004, and February 23, 2004, we received case briefs and rebuttal briefs, respectively, from the petitioners, China First Pencil Company, Ltd./Three Star Stationery Industry Corp. (CFP/Three Star), Orient International Holding Shanghai Foreign Trade Co., Ltd. (SFTC), and Shandong Rongxin Import & Export Company Ltd. (Rongxin) (formerly called Kaiyuan Group Corporation).

The Department has conducted this administrative review in accordance with section 751 of the Tariff Act of 1930, as amended (the Act).

Scope of the Order

Imports covered by this order are shipments of certain cased pencils of any shape or dimension (except as noted below) which are writing and/or drawing instruments that feature cores of graphite or other materials, encased in wood and/or man-made materials, whether or not decorated and whether or not tipped (e.g., with erasers, etc.) in any fashion, and either sharpened or unsharpened. The pencils subject to the order are classified under subheading 9609.10.00 of the Harmonized Tariff Schedule of the United States (HTSUS). Specifically excluded from the scope of the order are mechanical pencils, cosmetic pencils, pens, non-cased crayons (wax), pastels, charcoals, chalks, and pencils produced under U.S. patent number 6,217,242, from paper infused with scents by the means covered in the above-referenced patent, thereby having odors distinct from those that may emanate from pencils lacking the scent infusion. Also excluded from the scope of the order are pencils with all of the following physical characteristics: (1) Length: 13.5 or more inches; (2) sheath diameter: not less than one-and-one quarter inches at any point (before sharpening); and (3) core length: not more than 15 percent of the length of the pencil.

Although the HTSUS subheading is provided for convenience and customs purposes, our written description of the scope of the order is dispositive.

Partial Rescission

The Department preliminarily rescinded this review with respect to Tianjin Custom Wood Processing Co., Ltd. (TCW) because TCW reported that it did not export subject merchandise to the United States during the POR. See the Preliminary Results; see also; TCW's February 21, 2003, response to the Department's questionnaire. TCW's claim that it did not export subject merchandise during the POR is supported by U.S. Customs and Border Protection (CBP) data. Moreover, there is no evidence on the record of this segment of the proceeding indicating that TCW exported subject merchandise during the POR. Therefore, we are rescinding this review with respect to TCW.

Analysis of Comments Received

All issues raised in the case and rebuttal briefs by parties to this administrative review are addressed in the “Issues and Decision Memorandum” (Decision Memorandum) from Holly A. Kuga, Acting Deputy Assistant Secretary for Import Administration, to James J. Jochum, Assistant Secretary for Import Administration, dated May 12, 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 review and the corresponding recommendations in this public memorandum, which is on file in the Central Record 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 International Trade Administration's Web site at www.ia.ita.doc.gov . The paper copy and the electronic version of the Decision Memorandum are identical in content.

Changes Since the Preliminary Results

Based on our analysis of the comments received and the results of verification, we adjusted certain factors of production information that we used to calculate dumping margins in the preliminary results of review, and corrected certain programming and ministerial errors in our preliminary results. These changes are listed below.

All Respondents

We corrected the pencil slat dimensions used to calculate the surrogate value for pencil slats. We also corrected language in the margin calculation programs which incorrectly multiplied reported plant-to-port distances by 1.4. Additionally, we used the current surrogate labor rate in, and excluded unreliable surrogate data for cores from, our calculation.

CFP/Three Star

We corrected the plant-to-port-distance used to calculate the surrogate value for inland freight for CFP and Three Star. In addition, we corrected certain ministerial errors in CFP/Three Star's margin calculation program relating to control numbers. See the CFP/Three Star Margin Calculation Analysis memorandum for a list of changes based on verification findings. In addition, we excluded certain CFP/Three Star U.S. sales from our margin calculation.

Final Results of Review

We determine that the following weighted-average, ad valorem, percentage margins exist for the period December 1, 2001 through November 30, 2002:

Cash Deposit Requirements

The following cash deposit requirements will be effective upon publication of this notice of final results of administrative review for all shipments of pencils from the PRC entered, or withdrawn from warehouse, for consumption on or after the date of publication, as provided by section 751(a)(1) of the Act: (1) The cash deposit rates for the reviewed companies will be the rates shown above; (2) for previously reviewed or investigated companies not listed above, that have separate rates, the cash deposit rate will continue to be the company-specific rate published for the most recent period; (3) the cash deposit rate for all other PRC exporters will be 114.90 percent; and (4) the cash deposit rate for non-PRC exporters will be the rate applicable to the PRC supplier of that exporter.

These deposit requirements shall remain in effect until publication of the final results of the next administrative review.

Assessment

The Department will determine, and CBP will assess, antidumping duties on all entries of subject merchandise in accordance with these final results of review. For the companies subject to this review, we calculated exporter-specific assessment rates because there is no information on the record which identifies the importers of record. Specifically, for CFP/Three Star, SFTC and Rongxin, we calculated duty assessment rates for subject merchandise based on the ratio of the total amount of antidumping duties calculated for the examined sales to the total quantity of those sales. The Department will issue appropriate assessment instructions directly to CBP within 15 days of publication of these final results of review.

Reimbursement of Duties

This notice also serves as a final 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 doubled antidumping duties.

Administrative Protective Orders

This notice also serves as the only reminder to parties subject to administrative protective orders (APOs) of their responsibility concerning the return or destruction of proprietary information disclosed under an APO in accordance with 19 CFR 351.305. 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.

We are issuing and publishing this determination and notice in accordance with sections 751(a)(1) and 771(i) of the Act.

Appendix—Issues in Decision Memorandum

Comments

Comment 1: The Appropriate Surrogate Value for Pencil Cores

Comment 2: Whether China First Pencil Co. Ltd. (CFP)/Three Star Stationery Industry Corp. (Three Star) Reported U.S. Sales Made by Another PRC Entity

Comment 3: The Appropriate Surrogate Source For Financial Ratios

Comment 4: Ministerial Errors

Comment 5: Whether Three Star Reimbursed Certain U.S. Customers for Dumping Duties

Comment 6: Whether the Department Should Continue to Treat CFP and Three Star as a Single Entity for Antidumping Duty Purposes

Comment 7: How to Treat Certain Sales With Two Sales Invoices

Comment 8: Whether CFP's Dumping Margin Applies to its Subsidiaries