Notice of Decision of the Court of International Trade: Polyethylene Terephthalate Film, Sheet, and Strip from India

AGENCY:

Import Administration, International Trade Administration, Department of Commerce.

ACTION:

Notice of decision of the Court of International Trade.

SUMMARY:

On June 18, 2004, the Court of International Trade (CIT) sustained the Department of Commerce's (the Department's) redetermination to subject Polyplex Corporation Limited (Polyplex) to the antidumping duty (AD) order on Polyethylene Terephthalate Film, Sheet, and Strip (PET film) from India. See Dupont Teijin Films USA, LP, Mitsubishi Polyester Film of America, LLC, and Toray Plastics (America), Inc. v. United States and Polyplex Corporation Limited, USCIT Slip Op. 04-70 (June 18, 2004), Court No. 02-00463 (Dupont Teijin III). Consistent with the decision of the United States Court of Appeals for the Federal Circuit (Federal Circuit) in The Timken Company v. United States and China National Machinery and Equipment Import and Export Corporation, 893 F. 2d 337 (Fed. Cir. 1990) (Timken), the Department is publishing this notice of the CIT's decision in Dupont Teijin III.

EFFECTIVE DATE:

June 28, 2004.

FOR FURTHER INFORMATION CONTACT:

Howard Smith or Jeffrey Pedersen at (202) 482-5193 or (202) 482-2769, respectively; AD/CVD Enforcement, Office 4 Import Administration, Room 1870, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, NW, Washington, DC 20230.

SUPPLEMENTARY INFORMATION:

Background

In the investigative stage of this proceeding, the Department excluded Polyplex, a company with an AD margin greater than de minimis, from the AD order on PET film from India based on a zero percent AD cash deposit rate. The Department calculated the zero percent cash deposit rate by reducing the AD margin by the export subsidies found in the companion countervailing duty (CVD) investigation. See Notice of Final Determination of Sales at Less Than Fair Value: Polyethylene Terephthalate Film, Sheet, and Strip from India, 67 Fed. Reg. 34899, 34901 (May 16, 2002), and accompanying Issues and Decision Memorandum (Final Determination), as amended, 67 Fed. Reg. 44175 (July 1, 2002). The plaintiffs in the Court proceeding under consideration here filed a motion for judgement upon the agency record contesting the Department's final AD determination. The plaintiffs claimed that the Department improperly excluded Polyplex from the AD order on PET film from India because Polyplex's dumping margin, before adjusting the company's AD cash deposit rate for CVD export subsidies, is 10.34 percent. The Court agreed with the plaintiffs, noting that the Department cannot exclude an exporter from an order because its cash deposit rate is zero. See Dupont Teijin Films USA, LP, Mitsubishi Polyester Film of America, LLC, and Toray Plastics (America), Inc. v. United States and Polyplex Corporation Limited, 273 F. Supp. 2d 1347, 1352 (July 9, 2003) (Dupont Teijin I). However, because the Department accounted for CVD export subsidies by adjusting the AD cash deposit rate, rather than U.S. price, as required by 19 U.S.C. § 1677a, the Court stated that “{u}pon remand, Commerce must calculate Polyplex's dumping margin after making the adjustments to export price required by 19 U.S.C. § 1677a and Commerce's reasonable interpretation thereof. If Commerce continues to calculate a dumping margin of 10.34 percent for Polyplex, Polyplex must be subject to the antidumping duty order ... .” See Dupont Teijin I, 273 F. Supp. 2d at 1352.

On August 11, 2003, the Department issued its Final Results of Redetermination Pursuant to Court Remand in which it explained that countervailing duties are imposed upon the issuance of a countervailing duty order. At the time that the Department issued its Final Determination, the order in the companion CVD investigation had not yet been issued. Thus, the Department argued that Polyplex's sales were not subject to a countervailing duty order. Therefore, the Department contended that its decision in the Final Determination not to increase U.S. price by the amount of the export subsidies determined in the companion CVD investigation is consistent with 1677a(c)(1)(C), which requires the Department to increase U.S. price by the amount of any countervailing duty imposed on the subject merchandise to offset an export subsidy. Because Polyplex's dumping margin, before taking into account export subsidies, is 10.34 percent, the Department, pursuant to the Court's remand order, stated that Polyplex will be subject to the AD order on PET film from India.

In Dupont Teijin Films USA, LP, Mitsubishi Polyester Film of America, LLC, and Toray Plastics (America), Inc., v. United States and Polyplex Corporation Limited, 297 F. Supp. 2d 1367 (Dupont Teijin II), the Court sustained the Department's interpretation, upon remand, of the statutory phrase “countervailing duty imposed” in the context of companion AD and CVD investigations. However, the Court again remanded this case to the Department, instructing it to: (1)“fully address Polyplex's concern that petitioners could unfairly control the respondents' fate in an AD determination and resulting AD order by filing an extension and/or alignment request in the countervailing duty investigation;” (2)“explain how it will “fairly and consistently apply its interpretation of 'imposed' when a final determination or an amended final determination issues on the same day as a countervailing duty order on the subject merchandise due to a petitioner's alignment request;” and, (3)“seek to restore the parties, as far as is possible, to the position they would have been had they been able to act on the Department's new interpretation of 'imposed,' and the court's determination in this matter, prior to the issuance of the Amended Final Determination.” See Dupont Teijin II, 297 F. Supp. 2d at 1374.

On March 3, 2004, the Department issued its second Final Results of Redetermination Pursuant to Court Remand (Second Remand Determination) in which it explained that although it would likely adjust a respondents' U.S. prices for export subsidies when it simultaneously issues a final AD determination and a CVD order on the same merchandise, it is not permitted to amend a final AD determination to take into account a CVD order issued subsequent to the AD final determination. Thus, the Department concluded that it was unable to exclude Polyplex from the AD order on PET film from India. The Department also explained that the risk of petitioners manipulating the process by filing an extension and/or alignment request in the countervailing duty investigation “is slight given the uncertainty of an investigation's final results, coupled with the extremely unusual circumstance present here, where a foreign producer's countervailed subsidies fully accounted for its less-than-fair-value sales, thereby reducing any AD cash deposits on its imported goods to zero.” See Dupont Teijin III, Slip Op. 04-70 at 12. The Court sustained the Department's Second Remand Determination in its entirety.

Notification

In its decision in Timken, the Federal Circuit held that, pursuant to 19 U.S.C. 1516a(e), the Department must publish notice of a CIT decision which is “not in harmony” with the Department's determination. The CIT's decision in Dupont Teijin III is not in harmony with the Department's final determination in the AD investigation of PET film from India. Therefore, publication of this notice fulfills the Department's obligation under 19 U.S.C. 1516a(e). In addition, this notice will serve to begin the suspension of liquidation pending the expiration of the period to appeal the CIT's June 18, 2004, decision, or, if that decision is appealed, pending a final decision by the Federal Circuit. The Department will instruct U.S. Customs and Border Protection to suspend liquidation of, and require a cash deposit of zero percent for, PET film exported by Polyplex that is entered, or withdrawn from warehouse, for consumption on or after June 28, 2004.