Notice of Initiation of Countervailing Duty Investigation: Citric Acid and Certain Citrate Salts from the People's Republic of China, 26960-26963 [E8-10516]
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Federal Register / Vol. 73, No. 92 / Monday, May 12, 2008 / Notices
merchandise; and (4) the cash deposit
rate for all other manufacturers or
exporters will continue to be 8.11
percent, the all–others rate established
in the LTFV investigation. See Notice of
Amended Final Determination of Sales
at Less Than Fair Value and
Antidumping Duty Order: Carbon and
Certain Alloy Steel Wire Rod from
Canada, 67 FR 65944 (October 29,
2002). These deposit requirements,
when imposed, shall remain in effect
until publication of the final results of
the next administrative review.
Notification to Interested Parties
This notice also serves as a final
reminder to importers of their
responsibility under 19 CFR
351.402(f)(2) 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
Department’s presumption that
reimbursement of the antidumping
duties occurred and the subsequent
assessment of doubled antidumping
duties.
This notice also serves as a reminder to
parties subject to administrative
protective orders (APOs) of their
responsibility concerning the
disposition 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 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.
This notice is issued and published in
accordance with sections 751(a)(1) and
777(i)(1) of the Act.
Dated: May 5, 2008.
David M. Spooner,
Assistant Secretaryfor Import Administration.
Appendix – Issues and Decision
Memorandum
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Comment 1: Adjustment to Pension
Liabilities
Comment 2: Adjustment to General &
Administrative Expenses
Comment 3: Arm’s–Length Program
Product Characteristic Variable Names
Comment 4: Level of Trade
Comment 5: Offsetting for U.S. Sales
that Exceed Normal Value
[FR Doc. E8–10514 Filed 5–9–08; 8:45 am]
BILLING CODE 3510–DS–S
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DEPARTMENT OF COMMERCE
International Trade Administration
(C–570–938)
Notice of Initiation of Countervailing
Duty Investigation: Citric Acid and
Certain Citrate Salts from the People’s
Republic of China
Import Administration,
International Trade Administration,
Department of Commerce.
EFFECTIVE DATE: May 12, 2008
FOR FURTHER INFORMATION CONTACT:
David Neubacher, Scott Holland, and
Shelly Atkinson, AD/CVD Operations,
Import Administration, International
Trade Administration, U.S. Department
of Commerce, 14th Street and
Constitution Avenue, NW, Washington,
DC 20230; telephone: (202) 482–5823,
(202) 482–1279, and (202) 482–0116,
respectively.
AGENCY:
SUPPLEMENTARY INFORMATION:
The Petition
On April 14, 2008, the Department of
Commerce (the ‘‘Department’’) received
a petition filed in proper form by Archer
Daniels Midland Company, Cargill, Inc.,
and Tate and Lyle Americas, Inc. (the
‘‘petitioners’’), domestic producers of
citric acid and certain citrate salts
(‘‘citric acid’’). On April 22, 2008, the
Department received a supplement to
the petition alleging several additional
subsidy programs. In response to the
Department’s requests, the petitioners
provided timely information
supplementing the petition on April 24,
2008 and April 28, 2008.
In accordance with section 702(b)(1)
of the Tariff Act of 1930, as amended
(‘‘the Act’’), the petitioners allege that
manufacturers, producers, or exporters
of citric acid in the People’s Republic of
China ( the ‘‘PRC’’), receive
countervailable subsidies within the
meaning of section 701 of the Act and
that such imports are materially
injuring, or threatening material injury
to, an industry in the United States.
The Department finds that the
petitioners filed the petition on behalf of
the domestic industry because they are
interested parties as defined in section
771(9)(C) of the Act and the petitioners
have demonstrated sufficient industry
support with respect to the
countervailing duty investigation (see
‘‘Determination of Industry Support for
the Petition’’ section below).
Period of Investigation
The period of investigation is January
1, 2007, through December 31, 2007.
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Scope of the Investigation
The scope of this investigation
includes all grades and granulation sizes
of citric acid, sodium citrate, and
potassium citrate in their unblended
forms, whether dry or in solution, and
regardless of packaging type. The scope
also includes blends of citric acid,
sodium citrate, and potassium citrate; as
well as blends with other ingredients,
such as sugar, where the unblended
form(s) of citric acid, sodium citrate,
and potassium citrate constitute 40
percent or more, by weight, of the blend.
The scope of this investigation also
includes all forms of unrefined calcium
citrate, including dicalcium citrate
monohydrate, and tricalcium citrate
tetrahydrate, which are intermediate
products in the production of citric
acid, sodium citrate, and potassium
citrate. The scope of this investigation
includes the hydrous and anhydrous
forms of citric acid, the dihydrate and
anhydrous forms of sodium citrate,
otherwise known as citric acid sodium
salt, and the monohydrate and
monopotassium forms of potassium
citrate. Sodium citrate also includes
both trisodium citrate and monosodium
citrate, which are also known as citric
acid trisodium salt and citric acid
monosodium salt, respectively. Citric
acid and sodium citrate are classifiable
under 2918.14.0000 and 2918.15.1000 of
the Harmonized Tariff Schedule of the
United States (‘‘HTSUS’’), respectively.
Potassium citrate and calcium citrate are
classifiable under 2918.15.5000 of the
HTSUS. Blends that include citric acid,
sodium citrate, and potassium citrate
are classifiable under 3824.90.9290 of
the HTSUS. Although the HTSUS
subheadings are provided for
convenience and customs purposes, the
written description of the merchandise
is dispositive.
Comments on Scope of Investigation
During our review of the petition, we
discussed the scope with the petitioners
to ensure that it is an accurate reflection
of the products for which the domestic
industry is seeking relief. Moreover, as
discussed in the preamble to the
regulations (Antidumping Duties;
Countervailing Duties; Final Rule, 62 FR
27296, 27323 (May 19, 1997)), we are
setting aside a period for interested
parties to raise issues regarding product
coverage. The Department encourages
all interested parties to submit such
comments within 20 calendar days of
the publication of this notice.
Comments should be addressed to
Import Administration’s Central
Records Unit (‘‘CRU’’), Room 1117, U.S.
Department of Commerce, 14th Street
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Federal Register / Vol. 73, No. 92 / Monday, May 12, 2008 / Notices
and Constitution Avenue, NW,
Washington, DC 20230. The period of
scope consultations is intended to
provide the Department with ample
opportunity to consider all comments
and to consult with parties prior to the
issuance of the preliminary
determinations.
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Consultations
Pursuant to section 702(b)(4)(A)(ii) of
the Act, the Department invited
representatives of the Government of the
PRC for consultations with respect to
the countervailing duty petition. The
Department held these consultations in
Beijing, China, with representatives of
the Government of the PRC on April 28,
2008. See the Memorandum to The File,
entitled, ‘‘Consultations with Officials
from the Government of the People’s
Republic of China’’ (April 28, 2008) on
file in the CRU of the Department of
Commerce, Room 1117.
Determination of Industry Support for
the Petitions
Section 702(b)(1) of the Act requires
that a petition be filed on behalf of the
domestic industry. Section 702(c)(4)(A)
of the Act provides that a petition meets
this requirement if the domestic
producers or workers who support the
petition account for: (i) at least 25
percent of the total production of the
domestic like product; and (ii) more
than 50 percent of the production of the
domestic like product produced by that
portion of the industry expressing
support for, or opposition to, the
petition. Moreover, section 702(c)(4)(D)
of the Act provides that, if the petition
does not establish support of domestic
producers or workers accounting for
more than 50 percent of the total
production of the domestic like product,
the Department shall: (i) poll the
industry or rely on other information in
order to determine if there is support for
the petition, as required by
subparagraph (A), or (ii) determine
industry support using a statistically
valid sampling method.
Section 771(4)(A) of the Act defines
the ‘‘industry’’ as the producers as a
whole of a domestic like product. Thus,
to determine whether a petition has the
requisite industry support, the statute
directs the Department to look to
producers and workers who produce the
domestic like product. The International
Trade Commission (‘‘ITC’’), which is
responsible for determining whether
‘‘the domestic industry’’ has been
injured, must also determine what
constitutes a domestic like product in
order to define the industry. While both
the Department and the ITC must apply
the same statutory definition regarding
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the domestic like product (section
771(10) of the Act), they do so for
different purposes and pursuant to a
separate and distinct authority. In
addition, the Department’s
determination is subject to limitations of
time and information. Although this
may result in different definitions of the
like product, such differences do not
render the decision of either agency
contrary to law. See USEC, Inc. v.
United States, 132 F. Supp. 2d 1, 8 (CIT
2001), citing Algoma Steel Corp. Ltd. v.
United States, 688 F. Supp. 639, 644
(CIT 1988), aff’d 865 F.2d 240 (Fed. Cir.
1989), cert. denied 492 U.S. 919 (1989).
Section 771(10) of the Act defines the
domestic like product as ‘‘a product
which is like, or in the absence of like,
most similar in characteristics and uses
with, the article subject to an
investigation under this subtitle.’’ Thus,
the reference point from which the
domestic like product analysis begins is
‘‘the article subject to an investigation,’’
(i.e., the class or kind of merchandise to
be investigated, which normally will be
the scope as defined in the petition).
With regard to the domestic like
product, the petitioners do not offer a
definition of domestic like product
distinct from the scope of the
investigation. Based on our analysis of
the information submitted on the
record, we have determined that citric
acid and certain citrate salts (unrefined
calcium citrate, sodium citrate, and
potassium citrate) constitute a single
domestic like product and we have
analyzed industry support in terms of
that domestic like product. For a
discussion of the domestic like product
analysis in this case, see the
Countervailing Duty Investigation
Initiation Checklist: Citric Acid and
Certain Citrate Salts from the People’s
Republic of China (PRC), Industry
Support at Attachment II (PRC Initiation
Checklist) on file in the Central Records
Unit (CRU), Room 1117 of the main
Department of Commerce building.
Our review of the data provided in the
petition, supplemental submissions, and
other information readily available to
the Department indicates that the
petitioners have established industry
support. First, the petition established
support from domestic producers (or
workers) accounting for more than 50
percent of the total production of the
domestic like product and, as such, the
Department is not required to take
further action in order to evaluate
industry support (e.g., polling). See
Section 702(c)(4)(D) of the Act. Second,
the domestic producers have met the
statutory criteria for industry support
under section 702(c)(4)(A)(i) of the Act
because the domestic producers (or
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workers) who support the petition
account for at least 25 percent of the
total production of the domestic like
product. Finally, the domestic
producers have met the statutory criteria
for industry support under section
702(c)(4)(A)(ii) of the Act because the
domestic producers (or workers) who
support the petition account for more
than 50 percent of the production of the
domestic like product produced by that
portion of the industry expressing
support for, or opposition to, the
petition. Accordingly, the Department
determines that the petition was filed on
behalf of the domestic industry within
the meaning of section 702(b)(1) of the
Act. See PRC Initiation Checklist at
Attachment II (Industry Support).
The Department finds that the
petitioners filed the petition on behalf of
the domestic industry because they are
interested parties as defined in section
771(9)(C) of the Act and they have
demonstrated sufficient industry
support with respect to the
countervailing duty investigation that
they are requesting the Department
initiate. See PRC Initiation Checklist at
Attachment II (Industry Support).
Injury Test
Because the PRC, is a ‘‘Subsidies
Agreement Country’’ within the
meaning of section 701(b) of the Act,
section 701(a)(2) of the Act applies to
this investigation. Accordingly, the ITC
must determine whether imports of the
subject merchandise from the PRC
materially injure, or threaten material
injury to, a U.S. industry.
Allegations and Evidence of Material
Injury and Causation
The petitioners allege that imports of
citric acid and certain citrate salts from
the PRC are benefitting from
countervailable subsidies and that such
imports are causing or threatening to
cause, material injury to the domestic
industry producing citric acid and
certain citrate salts. The petitioners
contend that the industry’s injured
condition is illustrated by the reduced
market share, reduced production and
capacity utilization, reduced
employment, underselling and price
depressing and suppressing effects, lost
revenue and sales, a decline in financial
performance, and an increase in import
penetration. The Department has
assessed the allegations and supporting
evidence regarding material injury,
threat of material injury, and causation,
and the Department determines that
these allegations are properly supported
by adequate evidence and meet the
statutory requirements for initiation. See
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PRC Initiation Checklist at Attachment
III.
We are including in our investigation
the following programs alleged in the
petition to have provided
countervailable subsidies to producers
and exporters of the subject
merchandise in the PRC:
Preferential Lending
1. Government Policy Lending
Program
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2. Funds provided for the
rationalization of the citric acid
industry
3. Discounted loans for export–
oriented industries
4. Loans provided pursuant to the
Northeast Revitalization Program
Grant Programs
5. State Key Technology Renovation
Program Fund
6. National level grants to loss–
making state–owned enterprises
7. ‘‘Famous Brands’’ Program
Income Tax Programs
8. ‘‘Two Free, Three Half’’ program
9. Reduced income tax rates for
foreign–investment enterprises
based on location
10. Income tax exemption program for
export–oriented foreign–investment
enterprises
11. Tax benefits to foreign–investment
enterprises for certain reinvestment
of profits
12. Reduced income tax rate for high
or new technology enterprises
13. Reduced income tax rate for
technology or knowledge intensive
foreign–investment enterprises
14. Preferential income tax rate for
research and development at
foreign–investment enterprises
15. Preferential tax programs for
encouraged industries
16. Preferential tax policies for
township enterprises
17. Income tax credits on purchases of
domestically produced equipment
Indirect Tax Programs and Import
Tariff Program
18. Value added tax rebate for
purchases by foreign–investment
enterprises of domestically
produced equipment
19. Value added tax and duty
exemptions on imported equipment
20. Excessive value added tax rebates
on exports
Provincial/Local Subsidy Programs
21. Provincial level grants to loss–
making state–owned enterprises
22. Local income tax exemption and
reduction program for ‘‘productive’’
foreign–investment enterprises
Anhui Province:
23. Reduced income tax rates for
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encouraged industries in Anhui
Province
24. Provision of land for less than
adequate remuneration in Anhui
Province
Guangdong Province:
25. Funds for ‘‘outward expansion’’ of
industries in Guangdong Province
Jiangsu Province:
26. Income tax exemption for foreign–
investment enterprises located in
Jiangsu Province
27. Preferential tax programs for
enterprises located in the Su Qian
Economic Development Zone
28. Provision of land for less than
adequate remuneration in the Su
Qian Economic Development Zone
29. Provision of electricity for less
than adequate remuneration in the
Su Qian Economic Development
Zone
Liaoning Province:
30. Loans and interest subsidies
pursuant to the Liaoning Province’s
five-year framework
Shandong Province:
31. Local and income tax exemptions
and reductions for firms located in
Qilu Chemicals Industry Park
Shanxi Province:
32. Preferential tax program for
enterprises located in Shanxi
Province
33. Funding for enterprises under the
Shanxi Province 10th Five-year
Plan
Shenzhen City:
34. Export interest subsidy funds for
enterprises located in Shenzhen
City
Zhejiang Province:
35. Export interest subsidy funds for
enterprises located in Zhejiang
Province
36. Exemptions and reductions in
taxes and fees for chemical research
and development institutions
located in Zhejiang Province
37. Provision of land for less than
adequate remuneration for
enterprises located in Hangzhou
Bay Fine Chemical Park
38. Provision of electricity for less
than adequate remuneration for
enterprises located in Hangzhou
Bay Fine Chemical Park
For further information explaining
why the Department is investigating
these programs,
see China Initiation Checklist.
We are not including in our
investigation the following programs
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alleged to benefit producers and
exporters of the subject merchandise in
the PRC:
Provision of Goods and Services- for
Less Than Adequate Remuneration by
the GOC
1. Water
The petitioners allege that through the
program of rationalization, the GOC has
promoted differential water rates to
favored citric acid producers within the
Chinese chemicals industry, despite
China’s limited water resources and the
water–intensive nature of the citric acid
industry. Petitioners have not
sufficiently alleged the elements
necessary for the imposition of a
countervailing duty and did not support
the allegation with reasonably available
information. Consequently, we do not
plan to investigate this program.
2. Land
The petitioners allege that the GOC
provides citric acid producers with land
grants and/or reduced land costs.
Petitioners have not sufficiently alleged
the elements necessary for the
imposition of a countervailing duty and
did not support the allegation with
reasonably available information.
Consequently, we do not plan to
investigate this program.
3. Electricity and natural gas
The petitioners allege that Chinese
citric acid producers benefit from
government–provided electricity and
natural gas at subsidized prices. The
GOC controls and sets prices for
electricity and natural gas. The
petitioners note that the GOC
acknowledged in its WTO accession
documents that it provides subsidies on
energy inputs to ‘‘special industry
sectors.’’ The government has also
recently identified the citric acid
industry as a high polluting industry
and non–backward producers as
‘‘preferred,’’ and has committed to
ending preferential policies to those
companies. Thus, the petitioners allege
that the remaining citric acid producers
will continue to receive energy
subsidies available to certain sectors.
Petitioners have not sufficiently alleged
the elements necessary for the
imposition of a countervailing duty and
did not support the allegation with
reasonably available information.
Consequently, we do not plan to
investigate this program.
Income Tax Programs
4. Preferential tax program for
enterprises in Beijing Municipality
Petitioners allege that the Beijing
Municipality provides subsidies to
develop the fine chemical industry,
which includes the citric acid industry.
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Petitioners have not sufficiently alleged
the elements necessary for the
imposition of a countervailing duty and
did not support the allegation with
reasonably available information.
Consequently, we do not plan to
investigate this program.
5. Preferential tax program for
enterprises in Chongqing
Municipality
In accordance with the West
Revitalization Project, the GOC offers
encouraged industries in the Chongqing
Municipality a preferred tax rate of
15%. Petitioners allege further that fine
chemical companies located in the
Chongqing Chemical Industrial Park are
eligible for additional benefits.
Petitioners have not sufficiently alleged
the elements necessary for the
imposition of a countervailing duty and
did not support the allegation with
reasonably available information.
Consequently, we do not plan to
investigate this program.
6. Preferential tax program for
enterprises in Shandong Province
Petitioners allege that municipal
governments encourages the
development of the chemical industry
by granting tax reductions and
exemptions for companies located in
chemical parks such as Qilu Chemical
Industry Park. Petitioners have not
sufficiently alleged the elements
necessary for the imposition of a
countervailing duty and did not support
the allegation with reasonably available
information. Consequently, we do not
plan to investigate this program.
Application of the Countervailing Duty
Law to the PRC
The Department has treated the PRC
as a non–market economy (‘‘NME’’)
country in all past AD investigations
and administrative reviews. In
accordance with section 771(18)(C)(i) of
the Act, any determination that a
country is an NME country shall remain
in effect until revoked by the
administering authority. See, e.g.,
Tapered Roller Bearings and Parts
Thereof, Finished and 10 Unfinished,
(‘‘TRBs’’) From the People’s Republic of
China: Preliminary Results of 2001–
2002 Administrative Review and Partial
Rescission of Review, 68 FR 7500, 7500–
1 (February 14, 2003), unchanged in
TRBs from the People’s Republic of
China: Final Results of 2001–2002
Administrative Review, 68 FR 70488,
70488–89 (December 18, 2003).
In the final affirmative CVD
determination on coated free sheet
paper from the PRC, the Department
determined that the current nature of
the PRC economy does not create
obstacles to applying the necessary
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criteria in the CVD law. See Coated Free
Sheet Paper from the People’s Republic
of China: Final Affirmative
Countervailing Duty Determination, 72
FR 60645 (October 25, 2007), and the
accompanying Issues and Decision
Memorandum at Comment 1. Therefore,
because Petitioners have provided
sufficient allegations and support of
their allegations to meet the statutory
criteria for initiating a CVD
investigation of citric acid from the PRC,
initiation of a CVD investigation is
warranted in this case. For further
information, see CVD Initiation
Checklist.
Respondent Selection
For this investigation, the Department
expects to select respondents based on
U.S. Customs and Border Protection
data for U.S. imports during the POI. We
intend to make our decision regarding
respondent selection within 20 days of
publication of this Federal Register
notice. The Department invites
comments regarding the CBP data and
respondent selection within seven
calendar days of publication of this
Federal Register notice.
Distribution of Copies of the Petition
In accordance with section
702(b)(4)(A)(i) of the Act, a copy of the
public version of the petition has been
provided to the Government of the PRC.
As soon as and to the extent practicable,
we will attempt to provide a copy of the
public version of the petition to each
exporter named in the petition,
consistent with 19 CFR 351.203(c)(2).
ITC Notification
We have notified the ITC of our
initiation, as required by section 702(d)
of the Act.
Preliminary Determination by the ITC
The ITC will preliminarily determine,
within 25 days after the date on which
it receives notice of the initiation,
whether there is a reasonable indication
that imports of subsidized citric acid
from the PRC are causing material
injury, or threatening to cause material
injury, to a U.S. industry. See section
703(a)(2) of the Act. A negative ITC
determination will result in the
investigation being terminated;
otherwise, the investigation will
proceed according to statutory and
regulatory time limits.
This notice is issued and published
pursuant to section 777(i) of the Act.
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26963
Dated: May 5, 2008.
David M. Spooner,
Assistant Secretaryfor Import Administration.
[FR Doc. E8–10516 Filed 5–9–08; 8:45 am]
BILLING CODE 3510–DS–S
DEPARTMENT OF COMMERCE
National Oceanic and Atmospheric
Administration
RIN: 0648–XH73
Gulf of Mexico Fishery Management
Council; Public Hearings
National Marine Fisheries
Service (NMFS), National Oceanic and
Atmospheric Administration (NOAA),
Commerce.
ACTION: Notice of a public hearing.
AGENCY:
SUMMARY: The Gulf of Mexico Fishery
Management Council (Council) will
convene a public hearing on
Aquaculture Amendment.
DATES: The hearing will convene at 6
p.m. on Wednesday, May 28, 2008 and
conclude no later than 9 p.m.
ADDRESSES: This hearing will be held at
the Radisson Hotel, 3820 N. Roosevelt
Blvd. Key West, FL 33040.
Council address: Gulf of Mexico
Fishery Management Council, 2203
North Lois Avenue, Suite 1100, Tampa,
FL 33607.
FOR FURTHER INFORMATION CONTACT:
Wayne Swingle, Executive Director;
telephone: (813) 348–1630.
SUPPLEMENTARY INFORMATION: The Gulf
of Mexico Fishery Management Council
(Council) is preparing an amendment
which will require persons to obtain a
permit from NMFS to participate in
aquaculture by constructing an
aquaculture facility in the EEZ of the
Gulf of Mexico. Each application for a
permit must comply with many permit
conditions related to record keeping and
operation of the facility. These permit
conditions will assure the facility has a
minimal affect on the environment and
on other fishery resources. Compliance
with the conditions will be evaluated
annually for the duration of the permit
as the basis for renewal of the permit for
the next year.
Copies of the Amendment a can be
obtained by calling the Council office at
(813) 348–1630.
Although non-emergency issues not
contained in this agenda may come
before this group for discussion, those
issues may not be the subject of formal
action during this hearing. Action will
be restricted to those issues specifically
identified in this notice and any issues
arising after publication of this notice
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]]>Agencies
[Federal Register Volume 73, Number 92 (Monday, May 12, 2008)]
[Notices]
[Pages 26960-26963]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E8-10516]
-----------------------------------------------------------------------
DEPARTMENT OF COMMERCE
International Trade Administration
(C-570-938)
Notice of Initiation of Countervailing Duty Investigation: Citric
Acid and Certain Citrate Salts from the People's Republic of China
AGENCY: Import Administration, International Trade Administration,
Department of Commerce.
EFFECTIVE DATE: May 12, 2008
FOR FURTHER INFORMATION CONTACT: David Neubacher, Scott Holland, and
Shelly Atkinson, AD/CVD Operations, Import Administration,
International Trade Administration, U.S. Department of Commerce, 14th
Street and Constitution Avenue, NW, Washington, DC 20230; telephone:
(202) 482-5823, (202) 482-1279, and (202) 482-0116, respectively.
SUPPLEMENTARY INFORMATION:
The Petition
On April 14, 2008, the Department of Commerce (the ``Department'')
received a petition filed in proper form by Archer Daniels Midland
Company, Cargill, Inc., and Tate and Lyle Americas, Inc. (the
``petitioners''), domestic producers of citric acid and certain citrate
salts (``citric acid''). On April 22, 2008, the Department received a
supplement to the petition alleging several additional subsidy
programs. In response to the Department's requests, the petitioners
provided timely information supplementing the petition on April 24,
2008 and April 28, 2008.
In accordance with section 702(b)(1) of the Tariff Act of 1930, as
amended (``the Act''), the petitioners allege that manufacturers,
producers, or exporters of citric acid in the People's Republic of
China ( the ``PRC''), receive countervailable subsidies within the
meaning of section 701 of the Act and that such imports are materially
injuring, or threatening material injury to, an industry in the United
States.
The Department finds that the petitioners filed the petition on
behalf of the domestic industry because they are interested parties as
defined in section 771(9)(C) of the Act and the petitioners have
demonstrated sufficient industry support with respect to the
countervailing duty investigation (see ``Determination of Industry
Support for the Petition'' section below).
Period of Investigation
The period of investigation is January 1, 2007, through December
31, 2007.
Scope of the Investigation
The scope of this investigation includes all grades and granulation
sizes of citric acid, sodium citrate, and potassium citrate in their
unblended forms, whether dry or in solution, and regardless of
packaging type. The scope also includes blends of citric acid, sodium
citrate, and potassium citrate; as well as blends with other
ingredients, such as sugar, where the unblended form(s) of citric acid,
sodium citrate, and potassium citrate constitute 40 percent or more, by
weight, of the blend. The scope of this investigation also includes all
forms of unrefined calcium citrate, including dicalcium citrate
monohydrate, and tricalcium citrate tetrahydrate, which are
intermediate products in the production of citric acid, sodium citrate,
and potassium citrate. The scope of this investigation includes the
hydrous and anhydrous forms of citric acid, the dihydrate and anhydrous
forms of sodium citrate, otherwise known as citric acid sodium salt,
and the monohydrate and monopotassium forms of potassium citrate.
Sodium citrate also includes both trisodium citrate and monosodium
citrate, which are also known as citric acid trisodium salt and citric
acid monosodium salt, respectively. Citric acid and sodium citrate are
classifiable under 2918.14.0000 and 2918.15.1000 of the Harmonized
Tariff Schedule of the United States (``HTSUS''), respectively.
Potassium citrate and calcium citrate are classifiable under
2918.15.5000 of the HTSUS. Blends that include citric acid, sodium
citrate, and potassium citrate are classifiable under 3824.90.9290 of
the HTSUS. Although the HTSUS subheadings are provided for convenience
and customs purposes, the written description of the merchandise is
dispositive.
Comments on Scope of Investigation
During our review of the petition, we discussed the scope with the
petitioners to ensure that it is an accurate reflection of the products
for which the domestic industry is seeking relief. Moreover, as
discussed in the preamble to the regulations (Antidumping Duties;
Countervailing Duties; Final Rule, 62 FR 27296, 27323 (May 19, 1997)),
we are setting aside a period for interested parties to raise issues
regarding product coverage. The Department encourages all interested
parties to submit such comments within 20 calendar days of the
publication of this notice. Comments should be addressed to Import
Administration's Central Records Unit (``CRU''), Room 1117, U.S.
Department of Commerce, 14th Street
[[Page 26961]]
and Constitution Avenue, NW, Washington, DC 20230. The period of scope
consultations is intended to provide the Department with ample
opportunity to consider all comments and to consult with parties prior
to the issuance of the preliminary determinations.
Consultations
Pursuant to section 702(b)(4)(A)(ii) of the Act, the Department
invited representatives of the Government of the PRC for consultations
with respect to the countervailing duty petition. The Department held
these consultations in Beijing, China, with representatives of the
Government of the PRC on April 28, 2008. See the Memorandum to The
File, entitled, ``Consultations with Officials from the Government of
the People's Republic of China'' (April 28, 2008) on file in the CRU of
the Department of Commerce, Room 1117.
Determination of Industry Support for the Petitions
Section 702(b)(1) of the Act requires that a petition be filed on
behalf of the domestic industry. Section 702(c)(4)(A) of the Act
provides that a petition meets this requirement if the domestic
producers or workers who support the petition account for: (i) at least
25 percent of the total production of the domestic like product; and
(ii) more than 50 percent of the production of the domestic like
product produced by that portion of the industry expressing support
for, or opposition to, the petition. Moreover, section 702(c)(4)(D) of
the Act provides that, if the petition does not establish support of
domestic producers or workers accounting for more than 50 percent of
the total production of the domestic like product, the Department
shall: (i) poll the industry or rely on other information in order to
determine if there is support for the petition, as required by
subparagraph (A), or (ii) determine industry support using a
statistically valid sampling method.
Section 771(4)(A) of the Act defines the ``industry'' as the
producers as a whole of a domestic like product. Thus, to determine
whether a petition has the requisite industry support, the statute
directs the Department to look to producers and workers who produce the
domestic like product. The International Trade Commission (``ITC''),
which is responsible for determining whether ``the domestic industry''
has been injured, must also determine what constitutes a domestic like
product in order to define the industry. While both the Department and
the ITC must apply the same statutory definition regarding the domestic
like product (section 771(10) of the Act), they do so for different
purposes and pursuant to a separate and distinct authority. In
addition, the Department's determination is subject to limitations of
time and information. Although this may result in different definitions
of the like product, such differences do not render the decision of
either agency contrary to law. See USEC, Inc. v. United States, 132 F.
Supp. 2d 1, 8 (CIT 2001), citing Algoma Steel Corp. Ltd. v. United
States, 688 F. Supp. 639, 644 (CIT 1988), aff'd 865 F.2d 240 (Fed. Cir.
1989), cert. denied 492 U.S. 919 (1989).
Section 771(10) of the Act defines the domestic like product as ``a
product which is like, or in the absence of like, most similar in
characteristics and uses with, the article subject to an investigation
under this subtitle.'' Thus, the reference point from which the
domestic like product analysis begins is ``the article subject to an
investigation,'' (i.e., the class or kind of merchandise to be
investigated, which normally will be the scope as defined in the
petition).
With regard to the domestic like product, the petitioners do not
offer a definition of domestic like product distinct from the scope of
the investigation. Based on our analysis of the information submitted
on the record, we have determined that citric acid and certain citrate
salts (unrefined calcium citrate, sodium citrate, and potassium
citrate) constitute a single domestic like product and we have analyzed
industry support in terms of that domestic like product. For a
discussion of the domestic like product analysis in this case, see the
Countervailing Duty Investigation Initiation Checklist: Citric Acid and
Certain Citrate Salts from the People's Republic of China (PRC),
Industry Support at Attachment II (PRC Initiation Checklist) on file in
the Central Records Unit (CRU), Room 1117 of the main Department of
Commerce building.
Our review of the data provided in the petition, supplemental
submissions, and other information readily available to the Department
indicates that the petitioners have established industry support.
First, the petition established support from domestic producers (or
workers) accounting for more than 50 percent of the total production of
the domestic like product and, as such, the Department is not required
to take further action in order to evaluate industry support (e.g.,
polling). See Section 702(c)(4)(D) of the Act. Second, the domestic
producers have met the statutory criteria for industry support under
section 702(c)(4)(A)(i) of the Act because the domestic producers (or
workers) who support the petition account for at least 25 percent of
the total production of the domestic like product. Finally, the
domestic producers have met the statutory criteria for industry support
under section 702(c)(4)(A)(ii) of the Act because the domestic
producers (or workers) who support the petition account for more than
50 percent of the production of the domestic like product produced by
that portion of the industry expressing support for, or opposition to,
the petition. Accordingly, the Department determines that the petition
was filed on behalf of the domestic industry within the meaning of
section 702(b)(1) of the Act. See PRC Initiation Checklist at
Attachment II (Industry Support).
The Department finds that the petitioners filed the petition on
behalf of the domestic industry because they are interested parties as
defined in section 771(9)(C) of the Act and they have demonstrated
sufficient industry support with respect to the countervailing duty
investigation that they are requesting the Department initiate. See PRC
Initiation Checklist at Attachment II (Industry Support).
Injury Test
Because the PRC, is a ``Subsidies Agreement Country'' within the
meaning of section 701(b) of the Act, section 701(a)(2) of the Act
applies to this investigation. Accordingly, the ITC must determine
whether imports of the subject merchandise from the PRC materially
injure, or threaten material injury to, a U.S. industry.
Allegations and Evidence of Material Injury and Causation
The petitioners allege that imports of citric acid and certain
citrate salts from the PRC are benefitting from countervailable
subsidies and that such imports are causing or threatening to cause,
material injury to the domestic industry producing citric acid and
certain citrate salts. The petitioners contend that the industry's
injured condition is illustrated by the reduced market share, reduced
production and capacity utilization, reduced employment, underselling
and price depressing and suppressing effects, lost revenue and sales, a
decline in financial performance, and an increase in import
penetration. The Department has assessed the allegations and supporting
evidence regarding material injury, threat of material injury, and
causation, and the Department determines that these allegations are
properly supported by adequate evidence and meet the statutory
requirements for initiation. See
[[Page 26962]]
PRC Initiation Checklist at Attachment III.
We are including in our investigation the following programs
alleged in the petition to have provided countervailable subsidies to
producers and exporters of the subject merchandise in the PRC:
Preferential Lending
1. Government Policy Lending Program
2. Funds provided for the rationalization of the citric acid
industry
3. Discounted loans for export-oriented industries
4. Loans provided pursuant to the Northeast Revitalization Program
Grant Programs
5. State Key Technology Renovation Program Fund
6. National level grants to loss-making state-owned enterprises
7. ``Famous Brands'' Program
Income Tax Programs
8. ``Two Free, Three Half'' program
9. Reduced income tax rates for foreign-investment enterprises
based on location
10. Income tax exemption program for export-oriented foreign-
investment enterprises
11. Tax benefits to foreign-investment enterprises for certain
reinvestment of profits
12. Reduced income tax rate for high or new technology enterprises
13. Reduced income tax rate for technology or knowledge intensive
foreign-investment enterprises
14. Preferential income tax rate for research and development at
foreign-investment enterprises
15. Preferential tax programs for encouraged industries
16. Preferential tax policies for township enterprises
17. Income tax credits on purchases of domestically produced
equipment
Indirect Tax Programs and Import Tariff Program
18. Value added tax rebate for purchases by foreign-investment
enterprises of domestically produced equipment
19. Value added tax and duty exemptions on imported equipment
20. Excessive value added tax rebates on exports
Provincial/Local Subsidy Programs
21. Provincial level grants to loss-making state-owned enterprises
22. Local income tax exemption and reduction program for
``productive'' foreign-investment enterprises
Anhui Province:
23. Reduced income tax rates for encouraged industries in Anhui
Province
24. Provision of land for less than adequate remuneration in Anhui
Province
Guangdong Province:
25. Funds for ``outward expansion'' of industries in Guangdong
Province
Jiangsu Province:
26. Income tax exemption for foreign-investment enterprises located
in Jiangsu Province
27. Preferential tax programs for enterprises located in the Su
Qian Economic Development Zone
28. Provision of land for less than adequate remuneration in the Su
Qian Economic Development Zone
29. Provision of electricity for less than adequate remuneration in
the Su Qian Economic Development Zone
Liaoning Province:
30. Loans and interest subsidies pursuant to the Liaoning
Province's five-year framework
Shandong Province:
31. Local and income tax exemptions and reductions for firms
located in Qilu Chemicals Industry Park
Shanxi Province:
32. Preferential tax program for enterprises located in Shanxi
Province
33. Funding for enterprises under the Shanxi Province 10th Five-
year Plan
Shenzhen City:
34. Export interest subsidy funds for enterprises located in
Shenzhen City
Zhejiang Province:
35. Export interest subsidy funds for enterprises located in
Zhejiang Province
36. Exemptions and reductions in taxes and fees for chemical
research and development institutions located in Zhejiang Province
37. Provision of land for less than adequate remuneration for
enterprises located in Hangzhou Bay Fine Chemical Park
38. Provision of electricity for less than adequate remuneration
for enterprises located in Hangzhou Bay Fine Chemical Park
For further information explaining why the Department is
investigating these programs,
see China Initiation Checklist.
We are not including in our investigation the following programs
alleged to benefit producers and exporters of the subject merchandise
in the PRC:
Provision of Goods and Services- for Less Than Adequate Remuneration by
the GOC
1. Water
The petitioners allege that through the program of rationalization,
the GOC has promoted differential water rates to favored citric acid
producers within the Chinese chemicals industry, despite China's
limited water resources and the water-intensive nature of the citric
acid industry. Petitioners have not sufficiently alleged the elements
necessary for the imposition of a countervailing duty and did not
support the allegation with reasonably available information.
Consequently, we do not plan to investigate this program.
2. Land
The petitioners allege that the GOC provides citric acid producers
with land grants and/or reduced land costs. Petitioners have not
sufficiently alleged the elements necessary for the imposition of a
countervailing duty and did not support the allegation with reasonably
available information. Consequently, we do not plan to investigate this
program.
3. Electricity and natural gas
The petitioners allege that Chinese citric acid producers benefit
from government-provided electricity and natural gas at subsidized
prices. The GOC controls and sets prices for electricity and natural
gas. The petitioners note that the GOC acknowledged in its WTO
accession documents that it provides subsidies on energy inputs to
``special industry sectors.'' The government has also recently
identified the citric acid industry as a high polluting industry and
non-backward producers as ``preferred,'' and has committed to ending
preferential policies to those companies. Thus, the petitioners allege
that the remaining citric acid producers will continue to receive
energy subsidies available to certain sectors. Petitioners have not
sufficiently alleged the elements necessary for the imposition of a
countervailing duty and did not support the allegation with reasonably
available information. Consequently, we do not plan to investigate this
program.
Income Tax Programs
4. Preferential tax program for enterprises in Beijing Municipality
Petitioners allege that the Beijing Municipality provides subsidies
to develop the fine chemical industry, which includes the citric acid
industry.
[[Page 26963]]
Petitioners have not sufficiently alleged the elements necessary for
the imposition of a countervailing duty and did not support the
allegation with reasonably available information. Consequently, we do
not plan to investigate this program.
5. Preferential tax program for enterprises in Chongqing
Municipality
In accordance with the West Revitalization Project, the GOC offers
encouraged industries in the Chongqing Municipality a preferred tax
rate of 15%. Petitioners allege further that fine chemical companies
located in the Chongqing Chemical Industrial Park are eligible for
additional benefits. Petitioners have not sufficiently alleged the
elements necessary for the imposition of a countervailing duty and did
not support the allegation with reasonably available information.
Consequently, we do not plan to investigate this program.
6. Preferential tax program for enterprises in Shandong Province
Petitioners allege that municipal governments encourages the
development of the chemical industry by granting tax reductions and
exemptions for companies located in chemical parks such as Qilu
Chemical Industry Park. Petitioners have not sufficiently alleged the
elements necessary for the imposition of a countervailing duty and did
not support the allegation with reasonably available information.
Consequently, we do not plan to investigate this program.
Application of the Countervailing Duty Law to the PRC
The Department has treated the PRC as a non-market economy
(``NME'') country in all past AD investigations and administrative
reviews. In accordance with section 771(18)(C)(i) of the Act, any
determination that a country is an NME country shall remain in effect
until revoked by the administering authority. See, e.g., Tapered Roller
Bearings and Parts Thereof, Finished and 10 Unfinished, (``TRBs'') From
the People's Republic of China: Preliminary Results of 2001-2002
Administrative Review and Partial Rescission of Review, 68 FR 7500,
7500-1 (February 14, 2003), unchanged in TRBs from the People's
Republic of China: Final Results of 2001-2002 Administrative Review, 68
FR 70488, 70488-89 (December 18, 2003).
In the final affirmative CVD determination on coated free sheet
paper from the PRC, the Department determined that the current nature
of the PRC economy does not create obstacles to applying the necessary
criteria in the CVD law. See Coated Free Sheet Paper from the People's
Republic of China: Final Affirmative Countervailing Duty Determination,
72 FR 60645 (October 25, 2007), and the accompanying Issues and
Decision Memorandum at Comment 1. Therefore, because Petitioners have
provided sufficient allegations and support of their allegations to
meet the statutory criteria for initiating a CVD investigation of
citric acid from the PRC, initiation of a CVD investigation is
warranted in this case. For further information, see CVD Initiation
Checklist.
Respondent Selection
For this investigation, the Department expects to select
respondents based on U.S. Customs and Border Protection data for U.S.
imports during the POI. We intend to make our decision regarding
respondent selection within 20 days of publication of this Federal
Register notice. The Department invites comments regarding the CBP data
and respondent selection within seven calendar days of publication of
this Federal Register notice.
Distribution of Copies of the Petition
In accordance with section 702(b)(4)(A)(i) of the Act, a copy of
the public version of the petition has been provided to the Government
of the PRC. As soon as and to the extent practicable, we will attempt
to provide a copy of the public version of the petition to each
exporter named in the petition, consistent with 19 CFR 351.203(c)(2).
ITC Notification
We have notified the ITC of our initiation, as required by section
702(d) of the Act.
Preliminary Determination by the ITC
The ITC will preliminarily determine, within 25 days after the date
on which it receives notice of the initiation, whether there is a
reasonable indication that imports of subsidized citric acid from the
PRC are causing material injury, or threatening to cause material
injury, to a U.S. industry. See section 703(a)(2) of the Act. A
negative ITC determination will result in the investigation being
terminated; otherwise, the investigation will proceed according to
statutory and regulatory time limits.
This notice is issued and published pursuant to section 777(i) of
the Act.
Dated: May 5, 2008.
David M. Spooner,
Assistant Secretaryfor Import Administration.
[FR Doc. E8-10516 Filed 5-9-08; 8:45 am]
BILLING CODE 3510-DS-S
