First Administrative Review of Certain Activated Carbon from the People's Republic of China: Final Results of Antidumping Duty Administrative Review

AGENCY:

Import Administration, International Trade Administration, Department of Commerce.

SUMMARY:

On May 7, 2009, the Department of Commerce (the “Department”) published in the Federal Register the preliminary results of the first administrative review of the antidumping duty order on certain activated carbon from the People's Republic of China (“PRC”). See Certain Activated Carbon From the People's Republic of China: Notice of Preliminary Results of the Antidumping Duty Administrative Review and Extension of Time Limits for the Final Results, 74 FR 21317 (May 7, 2009) (“Preliminary Results”). We gave interested parties an opportunity to comment on the Preliminary Results. Based upon our analysis of the comments and information received, we made changes to the margin calculations for the final results. We continue to find that certain exporters have sold subject merchandise at less than normal value during the period of review (“POR”), October 11, 2006, through March 31, 2008.

EFFECTIVE DATE:

November 10, 2009.

FOR FURTHER INFORMATION CONTACT:

Robert Palmer, AD/CVD Operations, Office 9, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, NW, Washington, DC 20230; telephone: (202) 482-9068.

SUPPLEMENTARY INFORMATION:

Background

On June 4, 2008, the Department initiated this review with respect to 90 companies upon which an administrative review was requested. See Initiation of Antidumping and Countervailing Duty Administrative Reviews and Requests for Revocation in Part, 73 FR 31813 (June 4, 2008) (“Initiation Notice”). Subsequently, pursuant to section 351.213(d)(1) of the Department's regulations, the Department rescinded the administrative review with respect to 57 companies, based upon Petitioners'¹ timely withdrawal of review requests. See Certain Activated Carbon From the People's Republic of China: Notice of Partial Rescission of Antidumping Duty Administrative Review, 73 FR 42550 (July 22, 2008). On October 1, 2008, the Department rescinded the administrative review with respect to an additional 19 companies, based on Petitioners' timely withdrawal of review requests. See Certain Activated Carbon from the People's Republic of China: Notice of Partial Rescission of Antidumping Duty Administrative Review, 73 FR 57058 (October 1, 2008). Thus, 14 companies remain subject to this review.

As noted above, on May 7, 2009, the Department published the Preliminary Results of this administrative review where we also extended the deadline for the final results by 60 days after publication of the Preliminary Results. See Preliminary Results. On July 20, 2009, Jacobi Carbons AB (“Jacobi”),² Ningxia Guanghua Cherishmet Activated Carbon Co., Ltd. (“Cherishmet”),³ and Calgon Carbon (Tianjin) Co., Ltd. (“CCT”) submitted additional surrogate value information. On July 30, 2009, Petitioners submitted rebuttal surrogate value information.

On September 3, 2009, we set the deadline for interested parties to submit case briefs and rebuttal briefs to September 14, 2009, and September 21, 2009, respectively. On September 15, 2009, we extended the deadline for parties to submit rebuttal briefs to September 23, 2009. On September 14, 2009, the Petitioners, Jacobi, CCT, Cherishmet, Sorbent Technologies Corporation (“Sorbent”)⁴ and certain SR Respondents⁵ filed case briefs. On September 23, 2009, the Petitioners, Jacobi, CCT, and Cherishmet filed rebuttal briefs. The Department did not hold a public hearing pursuant to 19 CFR 351.310(d), as all hearing requests made by interested parties were withdrawn.

Verification

Pursuant to section 351.307(b)(iv) of the Department's regulations, we conducted multiple verifications of respondents' questionnaire responses.⁶

Analysis of Comments Received

All issues raised in the case and rebuttal briefs by parties to these reviews are addressed in the “Administrative Review of Certain Activated Carbon from the People's Republic of China: Issues and Decision Memorandum for the Final Results,” which is dated concurrently with this notice (“Decision Memo”). A list of the issues which parties raised and to which we respond in the Decision Memo is attached to this notice as an Appendix. The Decision Memo is a public document and is on file in the Central Records Unit (“CRU”), Main Commerce Building, Room 1117, and is accessible on the Department's website at http://www.trade.gov/ia. The paper copy and electronic version of the memorandum are identical in content.

Changes Since the Preliminary Results

Based on a review of the record as well as comments received from parties regarding our Preliminary Results, we have made revisions to certain surrogate values and the margin calculations for CCT, Jacobi, and Cherishmet in the final results. Specifically, we have updated the surrogate values for several inputs. See Decision Memo at Comments 2d, 3b, 3c, 3d, 3g, and 3h. We have also corrected various ministerial errors alleged by respondents. See Decision Memo at Comments 6-9, 13-15, and 19-20. Lastly, we have reapplied certain allocation methodologies for data submitted by respondents. See Decision Memo at Comments 11-12. For all changes to the calculations, see Decision Memo and the company specific analysis memoranda.

Scope Of The Order

The merchandise subject to this order is certain activated carbon. Certain activated carbon is a powdered, granular, or pelletized carbon product obtained by “activating” with heat and steam various materials containing carbon, including but not limited to coal (including bituminous, lignite, and anthracite), wood, coconut shells, olive stones, and peat. The thermal and steam treatments remove organic materials and create an internal pore structure in the carbon material. The producer can also use carbon dioxide gas (CO2) in place of steam in this process. The vast majority of the internal porosity developed during the high temperature steam (or CO2 gas) activated process is a direct result of oxidation of a portion of the solid carbon atoms in the raw material, converting them into a gaseous form of carbon.

The scope of this order covers all forms of activated carbon that are activated by steam or CO2, regardless of the raw material, grade, mixture, additives, further washing or post-activation chemical treatment (chemical or water washing, chemical impregnation or other treatment), or product form. Unless specifically excluded, the scope of this order covers all physical forms of certain activated carbon, including powdered activated carbon (“PAC”), granular activated carbon (“GAC”), and pelletized activated carbon.

Excluded from the scope of the order are chemically activated carbons. The carbon-based raw material used in the chemical activation process is treated with a strong chemical agent, including but not limited to phosphoric acid, zinc chloride sulfuric acid or potassium hydroxide, that dehydrates molecules in the raw material, and results in the formation of water that is removed from the raw material by moderate heat treatment. The activated carbon created by chemical activation has internal porosity developed primarily due to the action of the chemical dehydration agent. Chemically activated carbons are typically used to activate raw materials with a lignocellulosic component such as cellulose, including wood, sawdust, paper mill waste and peat.

To the extent that an imported activated carbon product is a blend of steam and chemically activated carbons, products containing 50 percent or more steam (or CO2 gas) activated carbons are within this scope, and those containing more than 50 percent chemically activated carbons are outside this scope. This exclusion language regarding blended material applies only to mixtures of steam and chemically activated carbons.

Also excluded from the scope are reactivated carbons. Reactivated carbons are previously used activated carbons that have had adsorbed materials removed from their pore structure after use through the application of heat, steam and/or chemicals.

Also excluded from the scope is activated carbon cloth. Activated carbon cloth is a woven textile fabric made of or containing activated carbon fibers. It is used in masks and filters and clothing of various types where a woven format is required.

Any activated carbon meeting the physical description of subject merchandise provided above that is not expressly excluded from the scope is included within this scope. The products subject to the order are currently classifiable under the Harmonized Tariff Schedule of the United States (“HTSUS”) subheading 3802.10.00. Although the HTSUS subheading is provided for convenience and customs purposes, the written description of the scope of this order is dispositive.

Separate Rates

In our Preliminary Results, we determined that the following companies met the criteria for separate rate status: Ningxia Huahui Activated Carbon Co., Ltd.; Ningxia Lingzhou Foreign Trade Co., Ltd.; Tangshan Solid Carbon Co., Ltd.; Tianjin Maijin Industries Co., Ltd.; Datong Municipal Yunguang Activated Carbon Co., Ltd.; and Hebei Foreign Trade Advertisement Company (and its successor company, Hebei Shenglun Import and Export Group Company) (“Hebei Foreign”).

Additionally, in the Preliminary Results, we also noted that, the Department received completed responses to the Section A portion of the NME questionnaire from the individually reviewed respondents (CCT, Jacobi, and GHC), which contained information pertaining to the companies' eligibility for a separate rate. With respect to CCT and Jacobi, we preliminarily determined that there is no PRC ownership of either company, and because the Department has no evidence indicating that either company is under the control of the PRC, a separate rates analysis is not necessary to determine whether they are independent from government control. With respect to GHC, we preliminarily granted separate rate status to it based on the submitted information. We also preliminarily determined that one of the exporters under review not selected for individual examination, Tangshan Solid Carbon Co., Ltd., reported that it is 100 percent foreign owned. Accordingly, the Department also preliminarily granted separate rate status to Tangshan Solid Carbon Co. Ltd. See Preliminary Results at 21323-4.

With the exception of Hebei Foreign, we have not received any information since the issuance of the Preliminary Results that provides a basis for the reconsideration of these preliminary determinations. Therefore, the Department continues to find that CCT, Jacobi, GHC, Tangshan Solid Carbon Co. Ltd., Datong Municipal Yunguang Activated Carbon Co., Ltd., Ningxia Huahui Activated Carbon Co., Ltd., Ningxia Lingzhou Foreign Trade Co., Ltd., Tangshan Solid Carbon Co., Ltd., and Tianjin Maijin Industries Co., Ltd. meet the criteria for a separate rate.

With respect to Hebei Foreign, the Department is revoking Hebei Foreign's separate rate for these final results following certain information placed on the record of this review after the Preliminary Results which demonstrate that Hebei Foreign's separate rate status was based upon incorrect information. For further details, see Decision Memo at Comment 22.

Additionally, in the Preliminary Results, we stated that Ningxia Mineral &Chemical Limited, one of the 14 companies with an active review request, did not submit either a separate-rate application or certification. Thus, we preliminarily determined that it did not demonstrate its eligibility for separate rate status, and was included as part of the PRC-wide entity. Because we have not received any information since the issuance of the Preliminary Results that provides a basis for a reconsideration of that finding, we continue to find that Ningxia Mineral & Chemical Limited did not meet the criteria for a separate rate for the final results. Thus, for these final results, Ningxia Mineral & Chemical Limited will remain subject to the PRC-wide entity rate.

Lastly, as noted in the Preliminary Results, because Jilin Bright Future Chemicals Company, Ltd. (“Jilin”) (including affiliate Jilin Province Bright Future Industry and Commerce Co., Ltd.) did not participate in this administrative review, we preliminarily assigned to Jilin total adverse facts available (“AFA”). See Preliminary Results, 74 FR at 21321-2. We further stated that, as a result of Jilin's termination of participation from the instant proceeding, we did not grant Jilin a separate rate and consider Jilin part of the PRC-wide entity. See id. Because we have not received any information since the Preliminary Results that provides a basis for a reconsideration of that finding, we continue to find that Jilin is not eligible for a separate rate for these final results and remains subject to the PRC-wide entity rate.

Facts Available

Section 776(a)(2) of the Act provides that if an interested party: (A) withholds information that has been requested by the Department; (B) fails to provide such information in a timely manner or in the form or manner requested, subject to subsections 782(c)(1) and (e) of the Act; (C) significantly impedes a determination under the antidumping statute; or (D) provides such information but the information cannot be verified, the Department shall, subject to subsection 782(d) of the Act, use facts otherwise available in reaching the applicable determination.

Furthermore, 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. Adverse inferences are appropriate “to ensure that the party does not obtain a more favorable result by failing to cooperate than if it had cooperated fully.” See Statement of Administrative Action (“SAA”) accompanying the URAA, H.R. Doc. No. 316, 103d Cong., 2d Session at 870 (1994). An adverse inference may include reliance on information derived from the petition, the final determination in the investigation, any previous review, or any other information placed on the record. See section 776(b) of the Act.

As noted in the Preliminary Results, the Department selected Jilin for individual examination in this review. However, Jilin did not respond to any of the Department's requests for information.⁷ Because Jilin did not respond to the Department's requests for information and failed to demonstrate that it qualifies for separate rate status, we have determined Jilin to be a part of the PRC-wide entity.⁸ Consequently, because the PRC-wide entity, including Jilin, withheld requested information, failed to provide information in a timely manner and in the form requested, and significantly impeded this proceeding, we continue to find that the PRC-wide entity, including Jilin, failed to cooperate to the best of its ability, and, accordingly, apply AFA to calculate a margin for the PRC-wide entity. The Department's determination is in accordance with sections 776(a)(2)(A), (B), (C) and 776(b) of the Act.⁹

In the Initiation Notice, we required that all companies listed therein wishing to qualify for separate rate status in this administrative review to submit, as appropriate, either a separate rate application or certification.¹⁰ As noted above, the Department initiated this administrative review with respect to 90 companies, and rescinded the review on 76 of those 90 companies. Thus, including CCT, Jacobi, and GHC, 14 companies remain subject to this review. We note that one of the 14 companies, Ningxia Mineral & Chemical Limited, did not demonstrate its eligibility for separate rate status in this administrative review. In the Preliminary Results, the Department determined that those companies which did not demonstrate eligibility for a separate rate are properly considered part of the PRC-Wide entity.¹¹ Since the Preliminary Results, neither Ningxia Mineral & Chemical Limited nor Jilin submitted comments regarding these findings. Therefore, we continue to treat these entities as part of the PRC-Wide entity. Further, as stated above, since the Preliminary Results, the Department placed information on the record which shows evidence that Hebei Foreign's separate rate status was based on incorrect information, resulting in the revocation of Hebei Foreign's separate rate. Hebei Foreign has not submitted any information to contradict the evidence on the record. Thus, we have assigned Hebei Foreign the PRC-wide entity rate of 228.11 percent. Affiliation - GHC

In the Preliminary Results, we found Beijing Pacific, Cherishmet, GH and GHC to be a single entity for purposes of this administrative review. See Preliminary Results at 21319-21320; see 19 CFR 351.401(f). Because we have not received any information on the record that contradicts our preliminary finding, we shall continue to find Beijing Pacific, Cherishmet, GH and GHC to be a single entity for these final results.

Final Results Of Review

The weighted-average dumping margins for the POR are as follows:

Assessment

Upon issuance of these final results, the Department will determine, and CBP shall assess, antidumping duties on all appropriate entries covered by these reviews. The Department intends to issue assessment instructions to CBP 15 days after the publication date of the final results of this review excluding any reported sales that entered during the gap period. In accordance with 19 CFR 351.212(b)(1), we calculated exporter/importer (or customer)-specific assessment rates for the merchandise subject to this review. Where the respondent has reported reliable entered values, we calculated importer (or customer)-specific ad valorem rates by aggregating the dumping margins calculated for all U.S. sales to each importer (or customer) and dividing this amount by the total entered value of the sales to each importer (or customer). See 19 CFR 351.212(b)(1). Where an importer (or customer)-specific ad valorem rate is greater than de minimis, we will apply the assessment rate to the entered value of the importers'/customers' entries during the POR. See 19 CFR 351.212(b)(1).

Where we do not have entered values for all U.S. sales, we calculated a per-unit assessment rate by aggregating the antidumping duties due for all U.S. sales to each importer (or customer) and dividing this amount by the total quantity sold to that importer (or customer). See 19 CFR 351.212(b)(1). To determine whether the duty assessment rates are de minimis, in accordance with the requirement set forth in 19 CFR 351.106(c)(2), we calculated importer (or customer)-specific ad valorem ratios based on the estimated entered value. Where an importer (or customer)-specific ad valorem rate is zero or de minimis, we will instruct CBP to liquidate appropriate entries without regard to antidumping duties. See 19 CFR 351.106(c)(2).For the companies receiving a separate rate that were not selected for individual review, we will calculate an assessment rate based on the simple average of the cash deposit rates calculated for the companies selected for individual review pursuant to section 735(c)(5)(B) of the Act.

Cash Deposit Requirements

The following cash deposit requirements will be effective upon publication of these final results of administrative review for all shipments of the subject merchandise entered, or withdrawn from warehouse, for consumption on or after the publication date, as provided for by section 751(a)(2)(C) of the Act: (1) for the exporters listed above, the cash deposit rate will be established in the final results of this review (except, if the rate is zero or de minimis, i.e., less than 0.5 percent, no cash deposit will be required for that company); (2) for previously investigated or reviewed PRC and non-PRC exporters not listed above that have separate rates, the cash deposit rate will continue to be the exporter-specific rate published for the most recent period; (3) for all PRC exporters of subject merchandise which have not been found to be entitled to a separate rate, the cash deposit rate will be the PRC-wide rate of 228.11 percent; and (4) for all non-PRC exporters of subject merchandise which have not received their own rate, the cash deposit rate will be the rate applicable to the PRC exporters that supplied that non-PRC exporter. These deposit requirements, when imposed, shall remain in effect until further notice.

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 POR. Failure to comply with this requirement could result in the Department's presumption that reimbursement of antidumping duties has occurred and the subsequent assessment of doubled antidumping duties.

Administrative Protective Orders

This notice also serves as a reminder to parties subject to administrative protective orders (“APO”) of their responsibility concerning the return or destruction of proprietary information disclosed under APO in accordance with 19 CFR 351.305, which continues to govern business proprietary information in this segment of the proceeding. 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 administrative review and notice in accordance with sections 751(a)(1) and 777(i) of the Act.

Appendix I - Decision Memorandum

General Issues

Comment 1: Treatment of Sales with Negative Margins

Comment 2: Surrogate Financial Ratios a.Miscalculated Expenses b.Use of Indo German Carbons' Financial Statements c.Use of Core Carbons' Financial Statements d. Use of Quantum Active Carbons' Financial Statements

Comment 3: Surrogate Values a.Wage Rate Methodology b.Time Period Used for Surrogate Values c.Bituminous Coal d.Hydrochloric Acid e.Carbonized Materials f.Coal Tar g.Energy and Steam Coal h.Surrogate Value Applied to Activated Carbon i.HTS Numbers Used for Starch, Paint Thinner, and Ink Surrogate Values

Company-Specific Issues

CCT

Comment 4: Application of Total Adverse Facts Available

Comment 5: Corrections to Submitted Data a.Treatment of the Universe of Factor Data for Normal Value b.Treatment of U.S. Indirect Selling Expenses c.Treatment of Factor Data for Labor, Electricity, and Water d. Treatment of Freight for Tolling Operations

Comment 6: Freight Expense Calculation

Comment 7: Surrogate Margin for Further Manufactured Sales

Comment 8: Importer-Specific Assessment Rate

Comment 9: Ministerial Error for Units of Measure Conversions a.PE Film b.Plastic Strap/Packing String c.Plastic Rope

Jacobi

Comment 10: Application of Adverse Facts Available a.Application of Total AFA for Jacobi and NXHH b.Application of Total AFA for Jacobi and NXGH c.Application of Partial Adverse Facts Available for Jacobi and NXHH d. Application of Partial Adverse Facts Available for Jacobi and NXGH

Comment 11: Facts Available for Jacobi and DTHB

Comment 12: Yield Loss Reporting by Jacobi and DTHB and DTFW

Comment 13: Ministerial Error for Domestic Brokerage and Handling

Comment 14: Ministerial Error for Quantity Variable Used

Comment 15: Ministerial Error for Units of Measure Conversions

Cherishmet

Comment 16: Application of Total Adverse Facts Available

Comment 17: Application of Partial Adverse Facts Available a.Cherishmet and GHC b.Activated Carbon and Potassium c. Acid Washing Yield Loss

Comment 18: Columnar Coal

Comment 19: Ministerial Error for Units of Measure Conversion a.Plastic Bags b.Packing Freight

Comment 20: Ministerial Error for Domestic Inland Freight Calculation

Comment 21: Qualification for a Separate Rate

Hebei Foreign

Comment 22: Separate Rate Status