Steel Wire Garment Hangers From the People's Republic of China: Initiation of Anti-Circumvention Inquiry, 42685-42689 [2010-18000]
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Federal Register / Vol. 75, No. 140 / Thursday, July 22, 2010 / Notices
Atmospheric Administration (NOAA),
Commerce.
ACTION: Notice of initiation of 5-year
review; request for information.
NMFS announces a 5-year
review of the Baiji/Chinese River
Dolphin/Yangtze River Dolphin (Lipotes
vexillifer) under the Endangered
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SUMMARY:
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SUPPLEMENTARY INFORMATION:
Background
Under the ESA, a list of endangered
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list is published at 50 CFR 17.11 (for
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Baiji/Chinese River Dolphin/Yangtze
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currently listed as endangered.
Public Solicitation of New Information
To ensure that the 5-year review is
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information, we are soliciting new
information from the public, concerned
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interested parties concerning the status
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Yangtze River Dolphin (Lipotes
vexillifer).
Five-year reviews consider the best
scientific and commercial data and all
new information that has become
available since the listing determination
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or most recent status review. Categories
of requested information include the
following: (A) species biology,
including, but not limited to, population
trends, distribution, abundance,
demographics, and genetics; (B) habitat
conditions, including, but not limited
to, amount, distribution, and suitability;
(C) conservation measures that have
been implemented that benefit the
species; (D) status and trends of threats;
and (E) other new information, data, or
corrections, including, but not limited
to, taxonomic or nomenclatural changes,
identification of erroneous information
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If you wish to provide information for
this 5-year review, you may submit your
information and materials to Angela
Somma (see ADDRESSES).
Authority: 16 U.S.C. 1531 et seq.
Dated: July 15, 2010.
Therese Conant,
Acting Chief, Endangered Species Division,
Office of Protected Resources, National
Marine Fisheries Service.
[FR Doc. 2010–17832 Filed 7–21–10; 8:45 am]
BILLING CODE 3510–22–S
DEPARTMENT OF COMMERCE
International Trade Administration
[A–570–918]
Steel Wire Garment Hangers From the
People’s Republic of China: Initiation
of Anti-Circumvention Inquiry
Import Administration,
International Trade Administration,
Commerce.
SUMMARY: In response to requests from
the M&B Metal Products Co., Inc.
(‘‘Petitioner’’), the Department of
Commerce (‘‘Department’’) is initiating
an anti-circumvention inquiry to
determine whether certain imports of
steel wire garment hangers from the
Socialist Republic of Vietnam
(‘‘Vietnam’’) are circumventing the
antidumping duty order on steel wire
garment hangers (‘‘hangers’’) from the
People’s Republic of China (‘‘PRC’’). See
Notice of Antidumping Duty Order:
Steel Wire Garment Hangers from the
People’s Republic of China, 73 FR 58111
(October 6, 2008) (‘‘Hangers Order’’).
DATES: Effective Date: July 22, 2010.
FOR FURTHER INFORMATION CONTACT:
Irene Gorelik, 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)
482–6905.
AGENCY:
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SUPPLEMENTARY INFORMATION:
Background
On May 5, 2010, pursuant to section
781(b) of the Tariff Act of 1930, as
amended (‘‘Act’’), and 19 CFR
351.225(h), Petitioner submitted
requests for the Department to initiate
and conduct an anti-circumvention
inquiry of two Vietnamese companies to
determine whether hangers composed of
low-grade steel wire, which are
allegedly products of the PRC exported
from Vietnam, are circumventing the
Hangers Order.
In its two requests, Petitioner alleges
that PRC manufacturers of subject
merchandise have been circumventing
the Hangers Order by using two
Vietnamese companies to export their
hangers. Specifically, in its requests,
Petitioner claims that Angang Clothes
Rack Manufacture Co., Ltd. (‘‘Angang’’)
is circumventing the Hangers Order
with the help of its alleged affiliate,
PRC-based Shaoxing Gangyuan Metal
Manufactured Co., Ltd. (‘‘Gangyuan’’)
and that Quyky Yanglei International
Co., Ltd. (‘‘Quyky’’) is circumventing the
Hangers Order with the help of its
alleged affiliates, PRC-based Shanghai
Ruishan Metal Products Co., Ltd. and
Zhejiang Taizhou Hongda Metal
Products Co., Ltd. (collectively,
‘‘Ruishan-Taizhou’’). Petitioner further
alleges that Gangyuan and RuishanTaizhou are supplying pre-formed
hangers to Angang and Quyky,
respectively, for completion or assembly
into merchandise of the same class or
kind as the merchandise covered by the
Hangers Order and that this constitutes
circumvention.
On May 20, 2010, the Department sent
a supplemental questionnaire to
Petitioner regarding the requests to
initiate the anti-circumvention inquiry.
On May 25, 2010, Petitioner provided a
response to the Department’s
supplemental questionnaire. On May
25, 2010, Department met with the
foreign market researcher (‘‘FMR’’) to
discuss certain information contained in
the anti-circumvention inquiry requests.
See ‘‘Memorandum to the File through
Catherine Bertrand, Program Manager,
Office 9, from Irene Gorelik, Senior
Analyst, Office 9; Meeting with Foreign
Market Researcher,’’ dated June 1, 2010.
Neither Quyky nor Angang submitted
comments regarding Petitioner’s
circumvention allegations. Neither
Gangyuan nor Ruishan-Taizhou
submitted comments regarding
Petitioner’s allegations that they are
involved in the circumvention of the
Hangers Order.
On June 14, 2010, the Department
extended the deadline to initiate an
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anti-circumvention inquiry by 30 days,
pursuant to 19 CFR 351.302(b).1
Scope of the Order
The merchandise that is subject to the
order is steel wire garment hangers,
fabricated from carbon steel wire,
whether or not galvanized or painted,
whether or not coated with latex or
epoxy or similar gripping materials,
and/or whether or not fashioned with
paper covers or capes (with or without
printing) and/or nonslip features such
as saddles or tubes. These products may
also be referred to by a commercial
designation, such as shirt, suit, strut,
caped, or latex (industrial) hangers.
Specifically excluded from the scope of
the order are wooden, plastic, and other
garment hangers that are not made of
steel wire. Also excluded from the scope
of the order are chrome-plated steel wire
garment hangers with a diameter of 3.4
mm or greater. The products subject to
the order are currently classified under
U.S. Harmonized Tariff Schedule
(‘‘HTSUS’’) subheadings 7326.20.0020
and 7323.99.9060.
Although the HTSUS subheadings are
provided for convenience and customs
purposes, the written description of the
merchandise is dispositive.
Initiation of Anti-Circumvention
Proceeding
Section 781(b)(1) of the Act provides
that the Department may find
circumvention of an antidumping duty
order when merchandise of the same
class or kind subject to the order is
completed or assembled in a foreign
country other than the country to which
the order applies. In conducting anticircumvention inquiries, under section
781(b)(1) of the Act, the Department will
also evaluate whether: (1) The process
of assembly or completion in the other
foreign country is minor or
insignificant; (2) the value of the
merchandise produced in the foreign
country to which the antidumping duty
order applies is a significant portion of
the total value of the merchandise
exported to the United States; and (3)
action is appropriate to prevent evasion
of such an order or finding. As
discussed below, Petitioner presented
evidence with respect to these criteria.
A. Merchandise of the Same Class or
Kind
Petitioner states that the Hangers
Order covers hangers produced from
steel wire, which are often referred to as
shirt, suit, strut, and/or caped hangers,
imported under HTSUS 7326.20.0020,
and are commonly used in the dry
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1 See
Letter to Petitioner dated June 14, 2010.
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Sfmt 4703
cleaning industry. Petitioner argues that
since the merchandise being imported
into the United States from Vietnam,
under HTSUS 7326.20.0020, is
physically identical to subject
merchandise from the PRC entering the
United States, pursuant to section
781(b)(1)(A)(i) of the Act, these hangers
are of the same class or kind as those
subject to the Hangers Order. Petitioner
provided Zepol ImportIQ reports for
Angang and Quyky exports showing
bills of lading for merchandise identical
to that which is subject to the Hangers
Order. See Petitioner’s AntiCircumvention Inquiry Request for
Quyky, dated May 5, 2010, at 7 and
Exhibits 2, 3, and 9 (‘‘Quyky Request’’);
see also Petitioner’s Anti-Circumvention
Inquiry Request for Angang, dated May
5, 2010, at 7 and Exhibits 2 and 6
(‘‘Angang Request’’).
B. Completion of Merchandise in a
Foreign Country
Petitioner states that the hangers
subject to its anti-circumvention inquiry
requests are made from semi-finished
steel wire hangers produced in the PRC,
then exported to and completed in
Vietnam for re-export to the United
States. Petitioner argues that the semifinished hangers are imported by
Vietnamese companies 2 for end-stage
processing, which consists of unskilled
laborers manually affixing paper capes
and paper tubes with glue to the semifinished, PRC-produced hangers.
Petitioner contends that the completed
merchandise is then exported to the
United States as Vietnamese-origin.
Petitioner also notes that the paper
capes and tubes are also likely to be
PRC-origin and imported into Vietnam
for the end-stage processing. Therefore,
Petitioner concludes that, pursuant to
section 781(b)(1)(B)(ii) of the Act,
Quyky’s and Angang’s hangers are
merchandise completed in another
foreign country (Vietnam) from
merchandise that is produced in a
country (the PRC) already subject to an
antidumping duty order which includes
hangers produced from steel wire in its
scope. See Quyky Request, at 7; see also
Petitioner’s Angang Request for, at 8.
C. Minor or Insignificant Process
Petitioner argues that for the purposes
of section 781(b)(1)(C) of the Act, the
process of manually affixing paper
capes and tubes with glue to semifinished hangers in Vietnam is ‘‘minor
or insignificant’’ as defined by the Act.
According to Petitioner, the addition of
2 As noted above, Petitioner’s allegation of anticircumvention is focused on two Vietnamese
companies: Quyky and Angang.
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capes and tubes to formed shirt or strut
hangers is an operation that completes
the merchandise. However, Petitioner
argues that the most fundamental aspect
of the production process—the forming/
shaping of drawn steel wire into a
hanger—occurs in the PRC with heavy
and complex machinery. Citing to the
factor of production consumption ratios
reported by Gangyuan, one of the
individually investigated PRC exporters
in the underlying less-than-fair-value
(‘‘LTFV’’) investigation, Petitioner
contends that the steel input used in
producing the hangers themselves is ‘‘by
far the most significant in terms of
consumption * * * ’’ and that, ‘‘ * * *
there can be no question that the
production process utilized to form the
hangers accounts for the vast majority of
the total value of the final product.’’ See
Quyky Request at 10; see also Angang
Request, at Exhibit 5.
Petitioner further states that only
manual, unskilled labor is required to
affix paper capes, tubes and struts to
already formed hangers, without the
need for equipment or machinery.
Petitioner cites to the International
Trade Commission’s (‘‘ITC’’) final report,
where the ITC stated that ‘‘operations
such as the addition of capes and struts
and painting the wire are executed by
machine in the United States while they
may be performed manually in China.’’
See Steel Wire Garment Hangers from
China, Investigation No. 731–TA–1123
(Final), USITC Pub. 4034 (September
2008), at I–9 (‘‘ITC Report’’). Based on
information obtained by Petitioner,
paper capes, tubes, and struts are
manually affixed to formed hangers in
Vietnam. See Quyky Request at 10 and
Exhibit 5; see also Angang Request at 11
and Exhibit 3. Petitioner argues that
data and statements from the LTFV and
ITC investigations support its
statements that Vietnamese operations
involving the attachment of paper capes,
tubes, and struts with glue are ‘‘minor or
insignificant’’ processes.
Petitioner argues that an analysis of
the relevant statutory factors of section
781(b)(2) of the Act further supports its
conclusion that the Vietnamese
processing is ‘‘minor or insignificant.’’
These factors include: (1) Level of
investment in the foreign country;
(2) level of research and development in
the foreign country; (3) nature of the
production process in the foreign
country; (4) extent of production
facilities in the foreign country; and
(5) whether the value of the processing
in the foreign country represents a small
proportion of the value of the
merchandise imported into the United
States. Petitioner’s analysis of these
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factors, including citations as
appropriate, is as follows.
(1) Level of Investment
Petitioner claims that information
procured from Angang (and alleged PRC
affiliate, Gangyuan) indicates that little
investment has been or is being made in
Vietnam. Further, Petitioner also claims
that information procured from Quyky
(and alleged PRC affiliates, RuishanTaizhou) indicates that little investment
has been, or is being, made in Vietnam.
Petitioner argues that the business
model described by Angang and Quyky
indicates that they only serve as hanger
completion operations, are export
platforms for hangers, and are not
integrated production operations.
Petitioner further contends that the
extent of any investment in Vietnam
would be the materials required to
complete the hangers before exportation
to the United States, such as table and
chairs for the workers, glue to affix the
paper capes, tubes, and struts, and
packing materials. Petitioner cites to the
FMR’s report for detailed descriptions of
the low level of investment at Angang
and Quyky. Because the FMR’s report is
business proprietary information, its
specific content cannot be discussed
here. See Quyky Request at Exhibit 5;
see also Angang Request at Exhibit 3.
(2) Level of Research and Development
Petitioner states that, similar to the
level of investment, because Angang’s
and Quyky’s operations involve manual
labor and required little or no
machinery or equipment, no research
and development are required to set up
and operate a company to assemble or
complete hangers in Vietnam from
Chinese components. See Quyky
Request at 10 and Exhibit 5; see also
Angang Request at 11 and Exhibit 3.
(3) Nature of the Production Process
Petitioner argues that the nature of the
production process for hangers
completed or assembled by Quyky and
Angang is based on unskilled manual
labor with little machinery or
equipment required. Petitioner states
that paper capes, tubes, and struts are
manually attached with glue to preformed hangers that had been imported
from partner producers in the PRC.
Petitioner notes that once the paper
capes and tubes have been affixed to the
pre-formed hangers, the completed
hangers are packaged into cartons for
export to the United States. See Quyky
Request at 10 and Exhibit 5; see also
Angang Request at 11 and Exhibit 3.
Petitioner adds that the most significant
operation in the manufacture of hangers
is not the addition of paper capes and
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42687
tubes but rather the steel wire rod
drawing process and hanger forming
process. See, e.g., Angang Request at
footnote 23.
(4) Extent of Production in Vietnam
As stated above, Petitioner contends
that the extent of production in Vietnam
is the simple addition of paper capes
and tubes to pre-formed, PRC-produced
hangers that were imported by Quyky
and Angang. Petitioner states that this
process requires nothing more than
tables and chairs for the unskilled
laborers, glue, and packing materials for
exportation.
(5) Value of Vietnam Processing
Compared to Hangers Imported Into the
United States
Petitioner argues that the Vietnamese
assembly of pre-formed hangers adds
little value to the final product exported
to the United States. Petitioner argues
that the value of the final product is,
most significantly, the steel input.
Petitioner cites to Gangyuan’s responses
in the underlying investigation, where it
stated that ‘‘wire rod is the most
significant input in the production of
wire hangers.’’ See Angang’s Request at
10–11 and footnote 23. Petitioner
further cites to Gangyuan’s material
input consumption figures for the
production of subject merchandise,
noting that the steel input used to
produce subject merchandise was, by
far, the most significant input in the
production process. Id., at 12. Petitioner
further argues that even the paper
inputs, such as capes, tubes, and struts
used by Angang and Quyky in Vietnam
are also supplied by the PRC, thus, the
value of the manufacture of the preformed hangers and the paper
attachments originate in the PRC. As
stated above, Petitioner argues that the
completion activities in Vietnam add
very little to the hangers that are
exported to the United States because
the steel hanger was drawn from wire
rod and formed in the PRC.
D. Value of Merchandise Produced in
PRC
Petitioner argues that the evidence, as
noted supra, in its anti-circumvention
requests clearly supports its position
that the value of the pre-formed hangers
produced in the PRC, and then sent to
Angang and Quyky, represents a
significant portion of the total value of
the merchandise exported to the United
States, as measured by the consumption
figures reported by Gangyuan in the
underlying investigation and included
with Petitioner’s anti-circumvention
inquiry requests.
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E. Factors To Consider in Determining
Whether Action Is Necessary
Petitioner argues that the additional
factors contained in section 781(b)(3) of
the Act must also be considered in the
Department’s decision whether to issue
a finding of circumvention regarding
Vietnamese importation of semifinished hangers.
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Pattern of Trade
Petitioner states that section 781(b)(3)
of the Act directs the Department to take
into account patterns of trade when
making a decision whether to include
merchandise assembled or completed in
Vietnam within the scope of the
Hangers Order. Petitioner argues that in
July 2007, when Petitioner filed its
antidumping petition, Vietnam was not
a source of any exports of hangers to the
United States. Petitioner bases these
claims on an analysis of publicly
available information from the ITC’s
Dataweb of U.S. import data. See Quyky
Request at 13 and Exhibit 9; see also
Angang Request at 14 and Exhibit 6.
Petitioner claims that, upon the
publication of the preliminary
determination in the underlying
investigation, Vietnamese exports of
hangers to the United States increased
dramatically. See Quyky Request at
Exhibit 10; see also Angang Request at
Exhibit 7. Based on shipment data
obtained from Zepol ImportIQ, a
database of manifest data similar to
PIERS, Petitioner contends that two
months after the Hangers Order was
issued (October 2008), Angang began to
export hangers to the United States. See
Angang Request at 14 and Exhibit 2.
Further, based on Zepol ImportIQ,
Petitioner contends that, in September
2008, one month before the Hangers
Order was issued, Quyky began to ship
hangers to the United States from
Vietnam. See Quyky Request at Exhibit
2 and 3. Petitioner notes that, based on
information provided by the FMR,
Quyky has been shipping 25 containers
per month to the United States from
Vietnam, whereas, the Zepol ImportIQ
data has only accounted for up to nine
containers shipped monthly, suggesting
that the Zepol ImportIQ data has been
understated. Id. at 13. Petitioner argues
that these patterns of trade are
consistent with an assembly operation
in Vietnam established by PRC
producers who are no longer able to
supply hangers directly to the United
States due to the antidumping duty
order in place.
Affiliation
Petitioner states that section 781(b)(3)
of the Act directs the Department to take
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into account whether the manufacturer
or exporter of the merchandise is
affiliated with the person who uses the
merchandise to assemble or complete in
the foreign country the merchandise
that is subsequently imported into the
United States when making decisions
on anti-circumvention rulings. With
respect to Quyky, Petitioner argues that
Quyky has acknowledged that it has a
‘‘partner’’ factory in the PRC, namely
Ruishan. Petitioner also notes that,
based on publicly available information
Ruishan is affiliated with another PRC
producer of hangers, Taizhou. See
Quyky Request at 14 and Exhibit 1.
Petitioner contends that, based on
proprietary information, Quyky has
admitted that it imports its hanger
components from the PRC, and, through
minor assembly operations in Vietnam,
Quyky and Ruishan-Taizhou are
actively circumventing the Hangers
Order. According to Petitioner, the
acknowledgement of affiliation and the
timing of the exports from Vietnam to
the United States support a conclusion
that Quyky’s assembly of PRC-produced
hanger components in Vietnam is
circumventing the antidumping duty
order.
With respect to Angang, Petitioner
argues that Angang admits it receives all
of its hanger component parts from the
PRC and that Angang and Gangyuan are
affiliated. See Angang Request at 9 and
15. Petitioner argues that the combined
affiliation with Gangyuan, who as a PRC
exporter is subject to the Hangers Order,
and the timing of Angang’s initial
shipments to the United States suggests
a clear intention to shift completion of
merchandise subject to the Hangers
Order from the PRC to Vietnam.
Subsequent Import Volume
Petitioner states that section 781(b)(3)
of the Act directs the Department to take
into account whether imports into the
foreign country of the merchandise have
increased after the initiation of the
investigation which resulted in the
issuance of such an order or finding
when making a decision on anticircumvention rulings. Petitioner claims
it cannot access data concerning trade
flows of hangers or hanger components
between the PRC and Vietnam because
the HTSUS classification for subject
merchandise or the components of
hangers are contained within larger
basket categories that cannot track the
trade of the subject merchandise, or
components of the subject merchandise,
to the degree achieved for imports into
the United States. However, Petitioner
notes that, while import data of the
hangers HTSUS classification between
the PRC and Vietnam does not exist,
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U.S. import data does show that
Vietnam was not a source of hangers to
the United States until six months after
the petition for investigation was filed.
See Angang Request at 16 and Exhibit
6. Petitioner also argues that Angang’s
initial shipments starting in late 2008
support the conclusion that Vietnam
had not, until recently, been a source of
hanger shipments to the United States.
Id. at 2.
Analysis
Based on our analysis of Petitioner’s
anti-circumvention inquiry requests and
our May 25, 2010, meeting with the
FMR, the Department determines that
Petitioner has satisfied the criteria
under section 781(b)(2) of the Act to
warrant an initiation of a formal anticircumvention inquiry. In accordance
with 19 CFR 351.225(e), if the
Department finds that the issue of
whether a product is included within
the scope of an order cannot be
determined based solely upon the
application and the descriptions of the
merchandise, the Department will notify
by mail all parties on the Department’s
scope service list of the initiation of a
scope inquiry, including an anticircumvention inquiry. In addition, in
accordance with 19 CFR
351.225(f)(1)(ii), a notice of the
initiation of an anti-circumvention
inquiry issued under paragraph (e) of
this section will include a description of
the product that is the subject of the
anti-circumvention inquiry—hangers
manufactured from steel that contain
the characteristics as provided in the
scope of the Hangers Order, and an
explanation of the reasons for the
Department’s decision to initiate an
anti-circumvention inquiry, as provided
below.
With regard to whether the
merchandise from Vietnam is of the
same class or kind as the merchandise
produced in the PRC, Petitioner has
presented information to the
Department indicating that, pursuant to
sections 781(b)(1)(A), the merchandise
being exported from Vietnam by Angang
and Quyky may be of the same class or
kind as hangers produced in the PRC
and which are subject to the Hangers
Order. Consequently, the Department
finds that Petitioner provided sufficient
information in its requests regarding the
class or kind of merchandise to warrant
initiation of an anti-circumvention
inquiry.
With regard to completion or
assembly of merchandise in a foreign
country, pursuant to section
781(b)(1)(B), Petitioner has also
presented information to the
Department indicating that the hangers
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sroberts on DSKD5P82C1PROD with NOTICES
Federal Register / Vol. 75, No. 140 / Thursday, July 22, 2010 / Notices
exported from Vietnam to the United
States are being processed by Angang
and Quyky in Vietnam from pre-formed
hangers and paper components
allegedly provided by these companies’
suppliers in the PRC. We find that the
information presented by Petitioner
regarding this criterion supports its
requests to initiate an anticircumvention inquiry.
The Department believes that
Petitioner sufficiently addressed the
factors described by section 781(b)(2) of
the Act regarding whether the
processing of pre-formed hangers in
Vietnam is minor or insignificant.
Specifically, in support of its argument,
Petitioner relied on information from
the LTFV investigation, the ITC report,
and information in the FMR’s report.
Thus, we find that the information
presented by Petitioner supports its
requests to initiate an anticircumvention inquiry. In particular, we
find that Petitioner’s submissions
suggest that: (1) Little investment has
been made by either Angang or Quyky
company in their respective production
of hangers in Vietnam; (2) Angang’s and
Quyky’s Chinese affiliates have fully
integrated production facilities in the
PRC and, therefore, that research and
development presumably takes place in
the PRC rather than Vietnam; (3) the
gluing of capes to shirt hangers or
attaching tubes to strut hangers in
Vietnam does not alter the fundamental
characteristics of the hanger, nor
whether it is subject to the scope of the
Hangers Order; (4) Angang’s and
Quyky’s facilities have a lower
investment level by those companies
than that required by the typical capitalintensive nature of the wire-drawing
and hanger-forming processes; and (5)
assembling paper components to preformed hangers adds little value to the
merchandise imported to the United
States. Our analysis will focus on
Angang’s and Quyky’s assembly
operations in Vietnam and, in the
context of this proceeding, we will
closely examine the manner in which
these companies’ processing materials
are obtained, whether those materials
are considered subject to the scope of
the Hangers Order, and the extent of
processing in Vietnam, as well as the
manner in which production and sales
relationships are conducted with the
alleged PRC affiliates.
With respect to the value of the
merchandise produced in the PRC,
pursuant to section 781(b)(1)(D) of the
Act, Petitioner relied on its information
and arguments in the ‘‘minor or
insignificant process’’ portion of its anticircumvention requests to indicate that
the value of the steel wire may be
VerDate Mar<15>2010
18:46 Jul 21, 2010
Jkt 220001
significant relative to the total value of
a finished hanger with paper
accoutrements exported to the United
States. We find that the information
adequately meets the requirements of
this factor, as discussed above, for the
purposes of initiating an anticircumvention inquiry.
Finally, Petitioner argues that,
pursuant to section 781(b)(3) of the Act,
the Department should also consider the
pattern of trade, affiliation, and
subsequent import volumes as factors in
determining whether to initiate the anticircumvention inquiry. The U.S. import
data submitted by Petitioner suggests
that imports of steel wire garment
hangers from Vietnam have been rising
significantly since the issuance of the
Hangers Order in 2008, whereas in years
prior to 2008, there were no such
imports from Vietnam into the United
States.
Accordingly, based on Petitioner’s
submissions, we have determined that
we have a sufficient basis to initiate a
formal anti-circumvention inquiry
concerning the Hangers Order, pursuant
to section 781(b) of the Act. In
accordance with 19 CFR 351.225(l)(2), if
the Department issues a preliminary
affirmative determination, we will then
instruct U.S. Customs and Border
Protection to suspend liquidation and
require a cash deposit of estimated
duties on the merchandise.
These anti-circumvention inquiries
cover Angang and Quyky only. If,
within sufficient time, the Department
receives a formal request from an
interested party regarding potential
circumvention of the Hangers Order by
other Vietnamese companies, we will
consider conducting additional
inquiries concurrently.
The Department will, following
consultation with interested parties,
establish a schedule for questionnaires
and comments on the issues. The
Department intends to issue its final
determination within 300 days of the
date of publication of this initiation.
This notice is published in accordance
with section 777(i)(1) of the Act.
Dated: July 16, 2010.
Ronald K. Lorentzen,
Deputy Assistant Secretary for Import
Administration.
[FR Doc. 2010–18000 Filed 7–21–10; 8:45 am]
BILLING CODE 3510–DS–P
PO 00000
Frm 00012
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42689
DEPARTMENT OF COMMERCE
National Oceanic and Atmospheric
Administration
RIN 0648–XX67
Marine Mammals; File Nos. 15498 and
15500
National Marine Fisheries
Service (NMFS), National Oceanic and
Atmospheric Administration (NOAA),
Commerce.
ACTION: Notice; issuance of permits.
AGENCY:
Notice is hereby given that
the Chicago Zoological Society Brookfield Zoo, 3300 Golf Road,
Brookfield, IL 60513, and the Georgia
Aquarium, 225 Baker Street, NW.,
Atlanta, GA 30313 have been issued
permits to import Atlantic bottlenose
dolphins (Tursiops truncatus) for public
display.
ADDRESSES: The permits and related
documents are available for review
upon written request or by appointment
in the following office(s):
Permits, Conservation and Education
Division, Office of Protected Resources,
NMFS, 1315 East-West Highway, Room
13705, Silver Spring, MD 20910; phone
(301) 713–2289; fax (301) 713–0376;
File No. 15498: Northeast Region,
NMFS, 55 Great Republic Drive,
Gloucester, MA 01930; phone (978)
281–9328; fax (978) 281–9394; and
File No. 15500: Southeast Region,
NMFS, 263 13th Avenue South, Saint
Petersburg, FL 33701; phone (727) 824–
5312; fax (727) 824–5309.
FOR FURTHER INFORMATION CONTACT:
Jennifer Skidmore or Kristy Beard, (301)
713–2289.
SUPPLEMENTARY INFORMATION: On May 3,
2010, notice was published in the
Federal Register (75 FR 23242) that
requests for public display permits to
import bottlenose dolphins had been
submitted by the above-named
organizations. File No. 15498 requested
the importation of one male and one
female captive born bottlenose dolphin
from Dolphin Quest Bermuda,
Hamilton, Bermuda, to the Brookfield
Zoo, Brookfield, IL. File No. 15500
requested the importation of two male
captive born bottlenose dolphins from
Dolphin Experience, Ltd., Freeport,
Grand Bahama Island, The Bahamas,
and three female captive born bottlenose
dolphins from Dolphin Quest Bermuda,
Hamilton, Bermuda, to the Georgia
Aquarium, Atlanta, Georgia. The
requested permits have been issued
under the authority of the Marine
Mammal Protection Act of 1972, as
amended (16 U.S.C. 1361 et seq.), and
SUMMARY:
E:\FR\FM\22JYN1.SGM
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Agencies
[Federal Register Volume 75, Number 140 (Thursday, July 22, 2010)]
[Notices]
[Pages 42685-42689]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2010-18000]
-----------------------------------------------------------------------
DEPARTMENT OF COMMERCE
International Trade Administration
[A-570-918]
Steel Wire Garment Hangers From the People's Republic of China:
Initiation of Anti-Circumvention Inquiry
AGENCY: Import Administration, International Trade Administration,
Commerce.
SUMMARY: In response to requests from the M&B Metal Products Co., Inc.
(``Petitioner''), the Department of Commerce (``Department'') is
initiating an anti-circumvention inquiry to determine whether certain
imports of steel wire garment hangers from the Socialist Republic of
Vietnam (``Vietnam'') are circumventing the antidumping duty order on
steel wire garment hangers (``hangers'') from the People's Republic of
China (``PRC''). See Notice of Antidumping Duty Order: Steel Wire
Garment Hangers from the People's Republic of China, 73 FR 58111
(October 6, 2008) (``Hangers Order'').
DATES: Effective Date: July 22, 2010.
FOR FURTHER INFORMATION CONTACT: Irene Gorelik, 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) 482-6905.
[[Page 42686]]
SUPPLEMENTARY INFORMATION:
Background
On May 5, 2010, pursuant to section 781(b) of the Tariff Act of
1930, as amended (``Act''), and 19 CFR 351.225(h), Petitioner submitted
requests for the Department to initiate and conduct an anti-
circumvention inquiry of two Vietnamese companies to determine whether
hangers composed of low-grade steel wire, which are allegedly products
of the PRC exported from Vietnam, are circumventing the Hangers Order.
In its two requests, Petitioner alleges that PRC manufacturers of
subject merchandise have been circumventing the Hangers Order by using
two Vietnamese companies to export their hangers. Specifically, in its
requests, Petitioner claims that Angang Clothes Rack Manufacture Co.,
Ltd. (``Angang'') is circumventing the Hangers Order with the help of
its alleged affiliate, PRC-based Shaoxing Gangyuan Metal Manufactured
Co., Ltd. (``Gangyuan'') and that Quyky Yanglei International Co., Ltd.
(``Quyky'') is circumventing the Hangers Order with the help of its
alleged affiliates, PRC-based Shanghai Ruishan Metal Products Co., Ltd.
and Zhejiang Taizhou Hongda Metal Products Co., Ltd. (collectively,
``Ruishan-Taizhou''). Petitioner further alleges that Gangyuan and
Ruishan-Taizhou are supplying pre-formed hangers to Angang and Quyky,
respectively, for completion or assembly into merchandise of the same
class or kind as the merchandise covered by the Hangers Order and that
this constitutes circumvention.
On May 20, 2010, the Department sent a supplemental questionnaire
to Petitioner regarding the requests to initiate the anti-circumvention
inquiry. On May 25, 2010, Petitioner provided a response to the
Department's supplemental questionnaire. On May 25, 2010, Department
met with the foreign market researcher (``FMR'') to discuss certain
information contained in the anti-circumvention inquiry requests. See
``Memorandum to the File through Catherine Bertrand, Program Manager,
Office 9, from Irene Gorelik, Senior Analyst, Office 9; Meeting with
Foreign Market Researcher,'' dated June 1, 2010. Neither Quyky nor
Angang submitted comments regarding Petitioner's circumvention
allegations. Neither Gangyuan nor Ruishan-Taizhou submitted comments
regarding Petitioner's allegations that they are involved in the
circumvention of the Hangers Order.
On June 14, 2010, the Department extended the deadline to initiate
an anti-circumvention inquiry by 30 days, pursuant to 19 CFR
351.302(b).\1\
---------------------------------------------------------------------------
\1\ See Letter to Petitioner dated June 14, 2010.
---------------------------------------------------------------------------
Scope of the Order
The merchandise that is subject to the order is steel wire garment
hangers, fabricated from carbon steel wire, whether or not galvanized
or painted, whether or not coated with latex or epoxy or similar
gripping materials, and/or whether or not fashioned with paper covers
or capes (with or without printing) and/or nonslip features such as
saddles or tubes. These products may also be referred to by a
commercial designation, such as shirt, suit, strut, caped, or latex
(industrial) hangers. Specifically excluded from the scope of the order
are wooden, plastic, and other garment hangers that are not made of
steel wire. Also excluded from the scope of the order are chrome-plated
steel wire garment hangers with a diameter of 3.4 mm or greater. The
products subject to the order are currently classified under U.S.
Harmonized Tariff Schedule (``HTSUS'') subheadings 7326.20.0020 and
7323.99.9060.
Although the HTSUS subheadings are provided for convenience and
customs purposes, the written description of the merchandise is
dispositive.
Initiation of Anti-Circumvention Proceeding
Section 781(b)(1) of the Act provides that the Department may find
circumvention of an antidumping duty order when merchandise of the same
class or kind subject to the order is completed or assembled in a
foreign country other than the country to which the order applies. In
conducting anti-circumvention inquiries, under section 781(b)(1) of the
Act, the Department will also evaluate whether: (1) The process of
assembly or completion in the other foreign country is minor or
insignificant; (2) the value of the merchandise produced in the foreign
country to which the antidumping duty order applies is a significant
portion of the total value of the merchandise exported to the United
States; and (3) action is appropriate to prevent evasion of such an
order or finding. As discussed below, Petitioner presented evidence
with respect to these criteria.
A. Merchandise of the Same Class or Kind
Petitioner states that the Hangers Order covers hangers produced
from steel wire, which are often referred to as shirt, suit, strut,
and/or caped hangers, imported under HTSUS 7326.20.0020, and are
commonly used in the dry cleaning industry. Petitioner argues that
since the merchandise being imported into the United States from
Vietnam, under HTSUS 7326.20.0020, is physically identical to subject
merchandise from the PRC entering the United States, pursuant to
section 781(b)(1)(A)(i) of the Act, these hangers are of the same class
or kind as those subject to the Hangers Order. Petitioner provided
Zepol ImportIQ reports for Angang and Quyky exports showing bills of
lading for merchandise identical to that which is subject to the
Hangers Order. See Petitioner's Anti-Circumvention Inquiry Request for
Quyky, dated May 5, 2010, at 7 and Exhibits 2, 3, and 9 (``Quyky
Request''); see also Petitioner's Anti-Circumvention Inquiry Request
for Angang, dated May 5, 2010, at 7 and Exhibits 2 and 6 (``Angang
Request'').
B. Completion of Merchandise in a Foreign Country
Petitioner states that the hangers subject to its anti-
circumvention inquiry requests are made from semi-finished steel wire
hangers produced in the PRC, then exported to and completed in Vietnam
for re-export to the United States. Petitioner argues that the semi-
finished hangers are imported by Vietnamese companies \2\ for end-stage
processing, which consists of unskilled laborers manually affixing
paper capes and paper tubes with glue to the semi-finished, PRC-
produced hangers. Petitioner contends that the completed merchandise is
then exported to the United States as Vietnamese-origin. Petitioner
also notes that the paper capes and tubes are also likely to be PRC-
origin and imported into Vietnam for the end-stage processing.
Therefore, Petitioner concludes that, pursuant to section
781(b)(1)(B)(ii) of the Act, Quyky's and Angang's hangers are
merchandise completed in another foreign country (Vietnam) from
merchandise that is produced in a country (the PRC) already subject to
an antidumping duty order which includes hangers produced from steel
wire in its scope. See Quyky Request, at 7; see also Petitioner's
Angang Request for, at 8.
---------------------------------------------------------------------------
\2\ As noted above, Petitioner's allegation of anti-
circumvention is focused on two Vietnamese companies: Quyky and
Angang.
---------------------------------------------------------------------------
C. Minor or Insignificant Process
Petitioner argues that for the purposes of section 781(b)(1)(C) of
the Act, the process of manually affixing paper capes and tubes with
glue to semi-finished hangers in Vietnam is ``minor or insignificant''
as defined by the Act. According to Petitioner, the addition of
[[Page 42687]]
capes and tubes to formed shirt or strut hangers is an operation that
completes the merchandise. However, Petitioner argues that the most
fundamental aspect of the production process--the forming/shaping of
drawn steel wire into a hanger--occurs in the PRC with heavy and
complex machinery. Citing to the factor of production consumption
ratios reported by Gangyuan, one of the individually investigated PRC
exporters in the underlying less-than-fair-value (``LTFV'')
investigation, Petitioner contends that the steel input used in
producing the hangers themselves is ``by far the most significant in
terms of consumption * * * '' and that, `` * * * there can be no
question that the production process utilized to form the hangers
accounts for the vast majority of the total value of the final
product.'' See Quyky Request at 10; see also Angang Request, at Exhibit
5.
Petitioner further states that only manual, unskilled labor is
required to affix paper capes, tubes and struts to already formed
hangers, without the need for equipment or machinery. Petitioner cites
to the International Trade Commission's (``ITC'') final report, where
the ITC stated that ``operations such as the addition of capes and
struts and painting the wire are executed by machine in the United
States while they may be performed manually in China.'' See Steel Wire
Garment Hangers from China, Investigation No. 731-TA-1123 (Final),
USITC Pub. 4034 (September 2008), at I-9 (``ITC Report''). Based on
information obtained by Petitioner, paper capes, tubes, and struts are
manually affixed to formed hangers in Vietnam. See Quyky Request at 10
and Exhibit 5; see also Angang Request at 11 and Exhibit 3. Petitioner
argues that data and statements from the LTFV and ITC investigations
support its statements that Vietnamese operations involving the
attachment of paper capes, tubes, and struts with glue are ``minor or
insignificant'' processes.
Petitioner argues that an analysis of the relevant statutory
factors of section 781(b)(2) of the Act further supports its conclusion
that the Vietnamese processing is ``minor or insignificant.'' These
factors include: (1) Level of investment in the foreign country; (2)
level of research and development in the foreign country; (3) nature of
the production process in the foreign country; (4) extent of production
facilities in the foreign country; and (5) whether the value of the
processing in the foreign country represents a small proportion of the
value of the merchandise imported into the United States. Petitioner's
analysis of these factors, including citations as appropriate, is as
follows.
(1) Level of Investment
Petitioner claims that information procured from Angang (and
alleged PRC affiliate, Gangyuan) indicates that little investment has
been or is being made in Vietnam. Further, Petitioner also claims that
information procured from Quyky (and alleged PRC affiliates, Ruishan-
Taizhou) indicates that little investment has been, or is being, made
in Vietnam. Petitioner argues that the business model described by
Angang and Quyky indicates that they only serve as hanger completion
operations, are export platforms for hangers, and are not integrated
production operations. Petitioner further contends that the extent of
any investment in Vietnam would be the materials required to complete
the hangers before exportation to the United States, such as table and
chairs for the workers, glue to affix the paper capes, tubes, and
struts, and packing materials. Petitioner cites to the FMR's report for
detailed descriptions of the low level of investment at Angang and
Quyky. Because the FMR's report is business proprietary information,
its specific content cannot be discussed here. See Quyky Request at
Exhibit 5; see also Angang Request at Exhibit 3.
(2) Level of Research and Development
Petitioner states that, similar to the level of investment, because
Angang's and Quyky's operations involve manual labor and required
little or no machinery or equipment, no research and development are
required to set up and operate a company to assemble or complete
hangers in Vietnam from Chinese components. See Quyky Request at 10 and
Exhibit 5; see also Angang Request at 11 and Exhibit 3.
(3) Nature of the Production Process
Petitioner argues that the nature of the production process for
hangers completed or assembled by Quyky and Angang is based on
unskilled manual labor with little machinery or equipment required.
Petitioner states that paper capes, tubes, and struts are manually
attached with glue to pre-formed hangers that had been imported from
partner producers in the PRC. Petitioner notes that once the paper
capes and tubes have been affixed to the pre-formed hangers, the
completed hangers are packaged into cartons for export to the United
States. See Quyky Request at 10 and Exhibit 5; see also Angang Request
at 11 and Exhibit 3. Petitioner adds that the most significant
operation in the manufacture of hangers is not the addition of paper
capes and tubes but rather the steel wire rod drawing process and
hanger forming process. See, e.g., Angang Request at footnote 23.
(4) Extent of Production in Vietnam
As stated above, Petitioner contends that the extent of production
in Vietnam is the simple addition of paper capes and tubes to pre-
formed, PRC-produced hangers that were imported by Quyky and Angang.
Petitioner states that this process requires nothing more than tables
and chairs for the unskilled laborers, glue, and packing materials for
exportation.
(5) Value of Vietnam Processing Compared to Hangers Imported Into the
United States
Petitioner argues that the Vietnamese assembly of pre-formed
hangers adds little value to the final product exported to the United
States. Petitioner argues that the value of the final product is, most
significantly, the steel input. Petitioner cites to Gangyuan's
responses in the underlying investigation, where it stated that ``wire
rod is the most significant input in the production of wire hangers.''
See Angang's Request at 10-11 and footnote 23. Petitioner further cites
to Gangyuan's material input consumption figures for the production of
subject merchandise, noting that the steel input used to produce
subject merchandise was, by far, the most significant input in the
production process. Id., at 12. Petitioner further argues that even the
paper inputs, such as capes, tubes, and struts used by Angang and Quyky
in Vietnam are also supplied by the PRC, thus, the value of the
manufacture of the pre-formed hangers and the paper attachments
originate in the PRC. As stated above, Petitioner argues that the
completion activities in Vietnam add very little to the hangers that
are exported to the United States because the steel hanger was drawn
from wire rod and formed in the PRC.
D. Value of Merchandise Produced in PRC
Petitioner argues that the evidence, as noted supra, in its anti-
circumvention requests clearly supports its position that the value of
the pre-formed hangers produced in the PRC, and then sent to Angang and
Quyky, represents a significant portion of the total value of the
merchandise exported to the United States, as measured by the
consumption figures reported by Gangyuan in the underlying
investigation and included with Petitioner's anti-circumvention inquiry
requests.
[[Page 42688]]
E. Factors To Consider in Determining Whether Action Is Necessary
Petitioner argues that the additional factors contained in section
781(b)(3) of the Act must also be considered in the Department's
decision whether to issue a finding of circumvention regarding
Vietnamese importation of semi-finished hangers.
Pattern of Trade
Petitioner states that section 781(b)(3) of the Act directs the
Department to take into account patterns of trade when making a
decision whether to include merchandise assembled or completed in
Vietnam within the scope of the Hangers Order. Petitioner argues that
in July 2007, when Petitioner filed its antidumping petition, Vietnam
was not a source of any exports of hangers to the United States.
Petitioner bases these claims on an analysis of publicly available
information from the ITC's Dataweb of U.S. import data. See Quyky
Request at 13 and Exhibit 9; see also Angang Request at 14 and Exhibit
6. Petitioner claims that, upon the publication of the preliminary
determination in the underlying investigation, Vietnamese exports of
hangers to the United States increased dramatically. See Quyky Request
at Exhibit 10; see also Angang Request at Exhibit 7. Based on shipment
data obtained from Zepol ImportIQ, a database of manifest data similar
to PIERS, Petitioner contends that two months after the Hangers Order
was issued (October 2008), Angang began to export hangers to the United
States. See Angang Request at 14 and Exhibit 2. Further, based on Zepol
ImportIQ, Petitioner contends that, in September 2008, one month before
the Hangers Order was issued, Quyky began to ship hangers to the United
States from Vietnam. See Quyky Request at Exhibit 2 and 3. Petitioner
notes that, based on information provided by the FMR, Quyky has been
shipping 25 containers per month to the United States from Vietnam,
whereas, the Zepol ImportIQ data has only accounted for up to nine
containers shipped monthly, suggesting that the Zepol ImportIQ data has
been understated. Id. at 13. Petitioner argues that these patterns of
trade are consistent with an assembly operation in Vietnam established
by PRC producers who are no longer able to supply hangers directly to
the United States due to the antidumping duty order in place.
Affiliation
Petitioner states that section 781(b)(3) of the Act directs the
Department to take into account whether the manufacturer or exporter of
the merchandise is affiliated with the person who uses the merchandise
to assemble or complete in the foreign country the merchandise that is
subsequently imported into the United States when making decisions on
anti-circumvention rulings. With respect to Quyky, Petitioner argues
that Quyky has acknowledged that it has a ``partner'' factory in the
PRC, namely Ruishan. Petitioner also notes that, based on publicly
available information Ruishan is affiliated with another PRC producer
of hangers, Taizhou. See Quyky Request at 14 and Exhibit 1. Petitioner
contends that, based on proprietary information, Quyky has admitted
that it imports its hanger components from the PRC, and, through minor
assembly operations in Vietnam, Quyky and Ruishan-Taizhou are actively
circumventing the Hangers Order. According to Petitioner, the
acknowledgement of affiliation and the timing of the exports from
Vietnam to the United States support a conclusion that Quyky's assembly
of PRC-produced hanger components in Vietnam is circumventing the
antidumping duty order.
With respect to Angang, Petitioner argues that Angang admits it
receives all of its hanger component parts from the PRC and that Angang
and Gangyuan are affiliated. See Angang Request at 9 and 15. Petitioner
argues that the combined affiliation with Gangyuan, who as a PRC
exporter is subject to the Hangers Order, and the timing of Angang's
initial shipments to the United States suggests a clear intention to
shift completion of merchandise subject to the Hangers Order from the
PRC to Vietnam.
Subsequent Import Volume
Petitioner states that section 781(b)(3) of the Act directs the
Department to take into account whether imports into the foreign
country of the merchandise have increased after the initiation of the
investigation which resulted in the issuance of such an order or
finding when making a decision on anti-circumvention rulings.
Petitioner claims it cannot access data concerning trade flows of
hangers or hanger components between the PRC and Vietnam because the
HTSUS classification for subject merchandise or the components of
hangers are contained within larger basket categories that cannot track
the trade of the subject merchandise, or components of the subject
merchandise, to the degree achieved for imports into the United States.
However, Petitioner notes that, while import data of the hangers HTSUS
classification between the PRC and Vietnam does not exist, U.S. import
data does show that Vietnam was not a source of hangers to the United
States until six months after the petition for investigation was filed.
See Angang Request at 16 and Exhibit 6. Petitioner also argues that
Angang's initial shipments starting in late 2008 support the conclusion
that Vietnam had not, until recently, been a source of hanger shipments
to the United States. Id. at 2.
Analysis
Based on our analysis of Petitioner's anti-circumvention inquiry
requests and our May 25, 2010, meeting with the FMR, the Department
determines that Petitioner has satisfied the criteria under section
781(b)(2) of the Act to warrant an initiation of a formal anti-
circumvention inquiry. In accordance with 19 CFR 351.225(e), if the
Department finds that the issue of whether a product is included within
the scope of an order cannot be determined based solely upon the
application and the descriptions of the merchandise, the Department
will notify by mail all parties on the Department's scope service list
of the initiation of a scope inquiry, including an anti-circumvention
inquiry. In addition, in accordance with 19 CFR 351.225(f)(1)(ii), a
notice of the initiation of an anti-circumvention inquiry issued under
paragraph (e) of this section will include a description of the product
that is the subject of the anti-circumvention inquiry--hangers
manufactured from steel that contain the characteristics as provided in
the scope of the Hangers Order, and an explanation of the reasons for
the Department's decision to initiate an anti-circumvention inquiry, as
provided below.
With regard to whether the merchandise from Vietnam is of the same
class or kind as the merchandise produced in the PRC, Petitioner has
presented information to the Department indicating that, pursuant to
sections 781(b)(1)(A), the merchandise being exported from Vietnam by
Angang and Quyky may be of the same class or kind as hangers produced
in the PRC and which are subject to the Hangers Order. Consequently,
the Department finds that Petitioner provided sufficient information in
its requests regarding the class or kind of merchandise to warrant
initiation of an anti-circumvention inquiry.
With regard to completion or assembly of merchandise in a foreign
country, pursuant to section 781(b)(1)(B), Petitioner has also
presented information to the Department indicating that the hangers
[[Page 42689]]
exported from Vietnam to the United States are being processed by
Angang and Quyky in Vietnam from pre-formed hangers and paper
components allegedly provided by these companies' suppliers in the PRC.
We find that the information presented by Petitioner regarding this
criterion supports its requests to initiate an anti-circumvention
inquiry.
The Department believes that Petitioner sufficiently addressed the
factors described by section 781(b)(2) of the Act regarding whether the
processing of pre-formed hangers in Vietnam is minor or insignificant.
Specifically, in support of its argument, Petitioner relied on
information from the LTFV investigation, the ITC report, and
information in the FMR's report. Thus, we find that the information
presented by Petitioner supports its requests to initiate an anti-
circumvention inquiry. In particular, we find that Petitioner's
submissions suggest that: (1) Little investment has been made by either
Angang or Quyky company in their respective production of hangers in
Vietnam; (2) Angang's and Quyky's Chinese affiliates have fully
integrated production facilities in the PRC and, therefore, that
research and development presumably takes place in the PRC rather than
Vietnam; (3) the gluing of capes to shirt hangers or attaching tubes to
strut hangers in Vietnam does not alter the fundamental characteristics
of the hanger, nor whether it is subject to the scope of the Hangers
Order; (4) Angang's and Quyky's facilities have a lower investment
level by those companies than that required by the typical capital-
intensive nature of the wire-drawing and hanger-forming processes; and
(5) assembling paper components to pre-formed hangers adds little value
to the merchandise imported to the United States. Our analysis will
focus on Angang's and Quyky's assembly operations in Vietnam and, in
the context of this proceeding, we will closely examine the manner in
which these companies' processing materials are obtained, whether those
materials are considered subject to the scope of the Hangers Order, and
the extent of processing in Vietnam, as well as the manner in which
production and sales relationships are conducted with the alleged PRC
affiliates.
With respect to the value of the merchandise produced in the PRC,
pursuant to section 781(b)(1)(D) of the Act, Petitioner relied on its
information and arguments in the ``minor or insignificant process''
portion of its anti-circumvention requests to indicate that the value
of the steel wire may be significant relative to the total value of a
finished hanger with paper accoutrements exported to the United States.
We find that the information adequately meets the requirements of this
factor, as discussed above, for the purposes of initiating an anti-
circumvention inquiry.
Finally, Petitioner argues that, pursuant to section 781(b)(3) of
the Act, the Department should also consider the pattern of trade,
affiliation, and subsequent import volumes as factors in determining
whether to initiate the anti-circumvention inquiry. The U.S. import
data submitted by Petitioner suggests that imports of steel wire
garment hangers from Vietnam have been rising significantly since the
issuance of the Hangers Order in 2008, whereas in years prior to 2008,
there were no such imports from Vietnam into the United States.
Accordingly, based on Petitioner's submissions, we have determined
that we have a sufficient basis to initiate a formal anti-circumvention
inquiry concerning the Hangers Order, pursuant to section 781(b) of the
Act. In accordance with 19 CFR 351.225(l)(2), if the Department issues
a preliminary affirmative determination, we will then instruct U.S.
Customs and Border Protection to suspend liquidation and require a cash
deposit of estimated duties on the merchandise.
These anti-circumvention inquiries cover Angang and Quyky only. If,
within sufficient time, the Department receives a formal request from
an interested party regarding potential circumvention of the Hangers
Order by other Vietnamese companies, we will consider conducting
additional inquiries concurrently.
The Department will, following consultation with interested
parties, establish a schedule for questionnaires and comments on the
issues. The Department intends to issue its final determination within
300 days of the date of publication of this initiation. This notice is
published in accordance with section 777(i)(1) of the Act.
Dated: July 16, 2010.
Ronald K. Lorentzen,
Deputy Assistant Secretary for Import Administration.
[FR Doc. 2010-18000 Filed 7-21-10; 8:45 am]
BILLING CODE 3510-DS-P