Notice of Preliminary Results of Antidumping Duty Changed Circumstances Review: Pressure Sensitive Plastic Tape from Italy

AGENCY:

Import Administration, International Trade Administration, Department of Commerce.

ACTION:

Notice of Preliminary Results of Antidumping Duty Changed Circumstances Review.

SUMMARY:

On August 27, 2003, the Department of Commerce (the Department) published a notice of initiation of changed circumstances review of the antidumping duty order on pressure sensitive plastic tape (PSPT) from Italy to determine whether Tyco Adhesives Italia S.p.A. (Tyco) is a successor-in-interest company to Manuli Tapes S.p.A. (Manuli). See Notice of Initiation of Antidumping Duty Changed Circumstances Review: Pressure Sensitive Plastic Tape from Italy, 68 FR 51557 (August 27, 2003) (Notice of Initiation). We have preliminarily determined that Tyco is the successor-in-interest to Manuli, for purposes of determining antidumping liability in this proceeding. Interested parties are invited to comment on these preliminary results.

EFFECTIVE DATE:

February 2, 2004.

FOR FURTHER INFORMATION CONTACT:

Zev Primor or Paige Rivas, AD/CVD Enforcement, Group II, Office 4, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, NW, Washington, DC 20230; telephone (202) 482-4114 or (202) 482-0651, respectively.

SUPPLEMENTARY INFORMATION:

Background

On July 3, 2003, Tyco requested that the Department conduct a changed circumstances review of the antidumping duty order on PSPT from Italy pursuant to section 751(b)(1) of the Tariff Act of 1930, as amended, (the Act), and 19 CFR 351.221(c)(3)(ii)(2003). Tyco claims to be the successor-in-interest to Manuli Tapes, S.p.A.¹, and, as such, claims that it is entitled to receive the same antidumping treatment as Manuli. On August 7, 2003, at the request of the Department, Tyco submitted additional information and documentation pertaining to its changed circumstances request. From November 12 through November 15, 2003, the Department conducted a verification of information pertaining to this changed circumstances review at Tyco's offices in Novara and Tyco's plant in Formia, both located in Italy.

Scope of Review

Imports covered by the review are shipments of PSPT measuring over 13/8 inches in width and not exceeding 4 millimeters in thickness, currently classifiable under items 3919.90.20 and 3919.90.50 of the Harmonized Tariff Schedule of the United States (HTSUS). HTSUS subheadings are provided for convenience and customs purposes. The written description remains dispositive as to the scope of the product coverage.

Preliminary Results of Review

In submissions to the Department dated July 3 and August 7, 2003, Tyco, an Italian holding company, advised the Department that on May 8, 2001, it acquired Manuli from its owner, Manuli Packaging Group, S.p.A. (Manuli Packaging). Up to that point, Manuli was a wholly-owned subsidiary of Manuli Packaging. Prior to its purchase of Manuli, Tyco did not hold an ownership interest in any other company, nor did it produce or sell any subject or non-subject merchandise.

In antidumping duty changed circumstances reviews involving a successor-in-interest determination, the Department typically examines several factors including, but not limited to, changes in: (1) management; (2) production facilities; (3) supplier relationships; and (4) customer base. See Brass Sheet and Strip from Canada: Notice of Final Results of Antidumping Administrative Review, 57 FR 20460, 20462 (May 13, 1992) (Canadian Brass). While no single factor or combination of factors will necessarily be dispositive, the Department generally will consider the new company to be the successor to the predecessor company if the resulting operations are essentially the same as those of the predecessor company. See, e.g., Industrial Phosphoric Acid from Israel: Final Results of Changed Circumstances Review, 59 FR 6944, 6945 (February 14, 1994), and Canadian Brass, 57 FR 20460. Thus, if the record evidence demonstrates that, with respect to the production and sale of the subject merchandise, the new company operates as the same business entity as the predecessor company, the Department may assign the new company the cash deposit rate of its predecessor. See, e.g., Fresh and Chilled Atlantic Salmon from Norway: Final Results of Changes Circumstances Antidumping Duty Administrative Review, 64 FR 9979, 9980 (March 1, 1999).

Our review of the evidence provided by Tyco indicates, preliminarily, that the change in ownership has not significantly changed the company's personnel, operations, supplier/customer relationship, or production facilities. With regard to management, at verification, the Department examined Tyco's payroll records and employment history of each of its top managers before and after the acquisition took place. We note, preliminarily, that no significant changes in management have occurred.

Additionally, as the new corporate entity, Tyco provided a certified copy of the official corporate registry showing it as a successor to Manuli as of May 8, 2001, the effective date of the acquisition, as well as documents showing that since the name change, Tyco continued Manuli's production of PSPT in the same manner using the same suppliers and facilities as it did under its previous name of Manuli. See Memorandum to the File, Antidumping Duty Changed Circumstances Review of Pressure Sensitive Plastic Tape from Italy: Verification Report for Tyco Adhesives Italia S.p.A. (TAI) Regarding Successorship, (Verification Report), at Exhibit 9 and 12.

Furthermore, Tyco provided certified statements from its President that all activities undertaken by Manuli prior to May 8, 2001, (i.e., production, sales, marketing, technical services, order receiving and freight forwarding of PSPT) have since been performed by Tyco. Finally, Tyco provided a copy of the Stock Purchase Agreement for Manuli, as well as a copy of corporate registry under the new name with the appropriate Italian authorities. See Verification Report, at Exhibit 8 and 10.

In sum, Tyco has presented evidence to establish a prima facie case of its successorship status. Manuli's acquisition by Tyco has precipitated minimal changes to the original Manuli corporate structure. Tyco's management, production facilities, supplier relationships, sales facilities and customer base are essentially unchanged from those of Manuli's. Therefore, the record evidence demonstrates that the new entity essentially operates in the same manner as the predecessor company. Consequently, we preliminarily determine that Tyco should be given the same antidumping duty treatment as Manuli, i.e., zero percent antidumping duty cash deposit rate.

The cash deposit determination from this changed circumstances review will apply to all entries of the subject merchandise entered, or withdrawn from warehouse, for consumption on or after the date of publication of the final results of this changed circumstances review. See Granular Polytetrafluoroethylene Resin from Italy; Final Results of Antidumping Duty Changed Circumstances Review, 68 FR 25327 (May 12, 2003). This deposit rate shall remain in effect until publication of the final results of the next administrative review in which Tyco participates.

Public Comment

Any interested party may request a hearing within 30 days of publication of this notice. 19 CFR 351.310(c). Any hearing, if requested, will be held 44 days after the date of publication of this notice, or the first working day thereafter. Interested parties may submit case briefs and/or written comments not later than 30 days after the date of publication of this notice. 19 CFR 351.309(c)(ii). Rebuttal briefs, which must be limited to issues raised in such briefs or comments, may be filed not later than 37 days after the date of publication of this notice. See 19 CFR 351.309(d). Parties who submit arguments are requested to submit with the argument (1) a statement of the issue, (2) a brief summary of the argument, and (3) a table of authorities.

Consistent with section 351.216(e) of the Department's regulations, we will issue the final results of this changed circumstances review no later than 270 days after the date on which this review was initiated.

This notice is in accordance with sections 751(b) and 777(i)(1) of the Act, and section 351.221(c)(3)(i) of the Department's regulations.