Polyethylene Terephthalate Film, Sheet, and Strip From India: Final Results of Countervailing Duty New Shipper Review

AGENCY:

Import Administration, International Trade Administration, Department of Commerce.

SUMMARY:

On December 21, 2010, the Department of Commerce (the Department) issued the preliminary results of the new shipper review of polyethylene terephthalate film, sheet and strip (PET Film) from India for SRF Limited (SRF), covering the period January 1, 2009, through December 31, 2009 (POR). Based on the results of our analysis of the comments received, we continue to find that the U.S. sale of subject merchandise produced and exported by SRF was bona fide. Also based on our analysis of SRF's comments, we made certain revisions to the calculations of several subsidy programs. The final subsidy rate for the reviewed company is listed below in the section titled “Final Results of New Shipper Review.” The Department will instruct U.S. Customs and Border Protection (CBP) to assess countervailing duties at the final subsidy rate.

DATES:

Effective Date: May 27, 2011.

FOR FURTHER INFORMATION CONTACT:

Elfi Blum or Toni Page, AD/CVD Operations, Office 6, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, NW., Washington, DC 20230; telephone: (202) 482-0197 or (202) 482-1398.

SUPPLEMENTARY INFORMATION:

Background

Since the issuance of Polyethylene Terephthalate Film, Sheet, and Strip From India: Preliminary Results of Countervailing Duty New Shipper Review, 75 FR 81574 (December 28, 2010) (Preliminary Results), the following events have occurred. SRF filed its response to the Department's second supplemental questionnaire on December 27, 2010. On January 21, 2011, the Department issued a memorandum confirming the briefing schedule, which was in accordance with 19 CFR 351.309(c) and the Preliminary Results, 75 FR at 81583. See Memorandum To Interested Parties From Elfi Blum, International Trade Compliance Analyst, AD/CVD Operations, Office 6: New Shipper Reviews of the Antidumping Duty and Countervailing Duty Orders on Polyethylene Terephthalate Film, Sheet, and Strip from India; Verification and Briefing Schedule for the Final Results of Review (January 21, 2011). SRF and the petitioners, Dupont Teijin Films, Mitsubishi Polyester Film of America, and Toray Plastics (America), Inc., timely filed case briefs on January 27, 2011. On January 31, 2011, the Department rejected SRF's case brief because it contained untimely new factual information. SRF timely re-filed its case brief on February 1, 2011. Both SRF and the petitioners timely filed their rebuttal briefs on February 1, 2011. On March 9, 2011, the Department published an extension of the final results of the new shipper review from March 21, 2011 to May 20, 2011. See Polyethylene Terephthalate Film, Sheet and Strip From India: Extension of Time Limit for Final Results of Countervailing Duty New Shipper Review, 76 FR 12938 (March 9, 2011).

The Department obtained, from CBP, import data for entries of PET Film from India into the United States during the period December 2009 through January 2011. On February 11, 2011, the Department placed this information on the record of this review. See Memorandum To All Interested Parties From Toni Page, International Trade Compliance Analyst: Antidumping and Countervailing Duty New Shipper Reviews of Polyethylene Terephthalate Film, Sheet, and Strip from India: U.S. Customs Entries from December 2009 to Present (January 11, 2011). The Department issued its third supplemental questionnaire to SRF on February 11, 2011, requesting information about the company's shipments after the POR of PET Film to the United States. On February 25, 2011, SRF filed its response to the Department's third supplemental questionnaire.

On April 13, 2011, the Department placed additional CBP data concerning post-POR shipments of PET Film to the United States, sold by SRF, on the record of this review and requested comments from the parties. See Memorandum To All Interested Parties From Toni Page, International Trade Compliance Analyst: Antidumping and Countervailing Duty New Shipper Reviews of Polyethylene Terephthalate Film, Sheet, and Strip from India: U.S. Customs Entries from December 2009 to present (April 13, 2011). The petitioners and SRF filed comments on the CBP data on April 18, 2011.

Scope of the Order

The products covered by the order are all gauges of raw, pretreated, or primed polyethylene terephthalate film, sheet and strip, whether extruded or coextruded. Excluded are metallized films and other finished films that have had at least one of their surfaces modified by the application of a performance-enhancing resinous or inorganic layer more than 0.00001 inches thick. Imports of PET Film are classifiable in the Harmonized Tariff Schedule of the United States (HTSUS) under item number 3920.62.00.90. HTSUS subheadings are provided for convenience and customs purposes. The written description of the scope of the order is dispositive.

Bona Fide Analysis of SRF's U.S. Sale

In the Preliminary Results, we determined that SRF's U.S. sale was a bona fide transaction. See Memorandum from Toni Page, International Trade Analyst Regarding: Bona Fide Analysis of the Sale in the Antidumping Duty New Shipper Review of Certain Polyethylene Terephthalate Film, Sheet, and Strip from India: SRF Limited (December 21, 2010). The Department also stated it would continue to examine, through the remainder of the review, all factors relating to the bona fide analysis of the sale. We have further examined the bona fide nature of SRF's U.S. sale and, for these final results, we continue to find the sale to be bona fide. For further details, see, Memorandum to File from Toni Page, International Trade Analyst, Bona Fide Analysis of SRF's Sale in the Countervailing Duty New Shipper Review of Polyethylene Terephthalate Film, Sheet, and Strip from India, dated concurrently with this notice.

Analysis of Comments Received

All issues raised in the case brief and rebuttal brief by parties to this new shipper review are addressed in Memorandum from Christian Marsh, Deputy Assistant Secretary for Antidumping and Countervailing Duty Operations, to Ronald K. Lorentzen, Deputy Assistant Secretary for Import Administration, Issues and Decision Memorandum for the Final Results of the Countervailing Duty New Shipper Review of Polyethylene Terephthalate Film, Sheet, and Strip (PET Film) from India (May 20, 2011) (Issues and Decision Memorandum), which is hereby adopted by this notice. The Issues and Decision Memorandum also contains a complete analysis of the programs covered by this review, the methodologies used to calculate the subsidy rates, and discusses any changes to the subsidy rates from the Preliminary Results. A list of the comments raised in the briefs and addressed in the Issues and Decision Memorandum is appended to this notice. The Issues and Decision Memorandum is on file in the Central Records Unit (CRU), room 7046 of the main Department building, and can be accessed directly on the Web at http://ia.ita.doc.gov/frn. The paper and electronic version of the Issues and Decision Memorandum are identical in content.

Changes Since the Preliminary Results

Based on our analysis of comments received, we have revised the calculations with respect to the benefit amount calculated on certain additional Export Promotion Capital Goods Scheme (EPCGS) licenses that SRF provided in its second supplemental questionnaire response, and that we included in our benefit calculations for those programs.

We also made changes to our benefit calculation with regard to the Advance License Program. Based on our analysis of the information SRF provided in its second supplemental questionnaire response, we have made changes to the numerator and the denominator in our benefit calculation for this program.

In addition, we revised our benefit calculations with respect to two sub-programs of the Special Economic Zone (SEZ) program, the “Discounted Land Fees in an SEZ” and “Exemption from Stamp Duty of all Transactions and Transfers of Immovable Property, or Documents related thereto within the SEZ (Stamp Duty).” Based on further analysis of the information provided on the record of this review, and the comments provided by interested parties, for these final results, we determine these benefits to be non-recurring under 19 CFR 351.524(b) and (c)(2)(i). We performed the “0.5 percent test,” as prescribed under 19 CFR 351.524(b)(2) and found that this SEZ land concession was in excess of 0.5 percent of SRF's total export sales in the year the benefit was bestowed. Therefore, for these final results, we allocated the 75 percent discount on the lease of the SEZ land, using as the allocation period for non-recurring subsidies the AUL prescribed by the Internal Revenue Service (IRS) for renewable physical assets for the industry under consideration (as listed in the IRS's 1977 Class Life Asset Depreciation Range System, and as updated by the Department of the Treasury), in accordance with 19 CFR 351.524(d)(2)(i). We found that the amount of uncollected stamp duties on the lease of the SEZ land was less than 0.5 percent of total export sales during the year in which the benefit was received. Therefore, we allocated the benefit received from exempted stamp duty to the year it was received.

Further, we made changes to our calculation of the rupee-denominated short-term benchmark. In the Preliminary Results we allocated loan fees due on the respective working capital loans during the POR, by applying the individual ratios to the sanctioned credit limits, as applicable, treating each listed sanctioned credit limit as an individual loan. Based on the detailed explanation in SRF's case brief, we re-examined the information on the record and have revised our calculation of SRF's rupee-denominated short-term benchmark for these final results. We have not treated each draw down as a separate loan; as a result, we have applied the application fees only once to each loan.

These changes are discussed in more detail in the Issues and Decision Memorandum.

Final Results of New Shipper Review

In accordance with section 751(a)(2)(B)(i) of the Tariff Act of 1930, as amended (the Act) and 19 CFR 351.221(b)(5), we calculated an individual ad valorem subsidy rate for SRF, for the POR for this new shipper review.

Disclosure

The Department will disclose to parties the calculations performed in connection with these final results within five days of the date of public announcement. See 19 CFR 351.224(b).

Assessment and Cash Deposit Instructions

The Department intends to issue assessment instructions to CBP 15 days after the date of publication of these final results of review to liquidate shipments of subject merchandise produced and exported by SRF and entered, or withdrawn from warehouse, for consumption on or after January 1, 2009, through December 31, 2009 at 3.04 percent ad valorem of the entered value.

The Department intends to also instruct CBP to collect cash deposits of the estimated countervailing duties at the rate of 3.04 percent ad valorem of the entered value on shipments of the subject merchandise produced and exported by SRF, entered, or withdrawn from warehouse, for consumption on or after the date of publication of the final results of this new shipper review.

Further, effective upon publication of the final results of this new shipper review, we intend to instruct CBP that importers may no longer post a bond or other security in lieu of a cash deposit on imports of PET Film from India, manufactured and exported by SRF. These cash deposit requirements, when imposed, shall remain in effect until further notice. The cash deposit rates for all companies not covered by this review are not changed by the results of this new shipper review.

Return or Destruction of Proprietary Information

This notice serves as a reminder to parties subject to the administrative protective order (APO) of their responsibility concerning the disposition of proprietary information disclosed under the APO in accordance with 19 CFR 351.305(a)(3). Timely written notification of return or 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.

We are issuing and publishing these results in accordance with sections 751(a)(1) and 777(i)(1) of the Act.

Appendix I—List of Issues Addressed in the Issues and Decision Memorandum

Comment 1: Whether SRF's Single Sale and its U.S. Customer Are Indicative of a Bona Fide Sale

Comment 2: Whether the Price and Quantity of SRF's New Shipper Sale Are Indicative of a Bona Fide Sale

Comment 3: Whether SRF's PET Film Entry Was Re-sold for a Profit

Comment 4: Whether to Countervail SRF's Additional EPCGS Licenses

Comment 5: The Appropriate Average Useful Life of Physical Assets to be Applied

Comment 6: SEZ Land Concession

Comment 7: Exemption of Stamp Duty on Land Purchase as a Recurring Benefit

Comment 8: Countervailability of SRF's Advance Licenses

Comment 9: Countervailability of SRF's Advance Licenses Pertaining to Non-Subject Merchandise

Comment 10: Calculation of the Rupee Denominated Short-Term Benchmark Interest Rate