Glycine From the People's Republic of China: Preliminary Partial Affirmative Determination of Circumvention of the Antidumping Duty Order and Initiation of Scope Inquiry, 21532-21536 [2012-8597]

Download as PDF 21532 Federal Register / Vol. 77, No. 69 / Tuesday, April 10, 2012 / Notices 3. Selection of Adverse Facts Available Rate [FR Doc. 2012–8601 Filed 4–9–12; 8:45 am] BILLING CODE 3510–DS–P DEPARTMENT OF COMMERCE International Trade Administration [A–570–836] Glycine From the People’s Republic of China: Preliminary Partial Affirmative Determination of Circumvention of the Antidumping Duty Order and Initiation of Scope Inquiry Import Administration, International Trade Administration, Department of Commerce. SUMMARY: We preliminarily determine that glycine processed by Salvi Chemical Industries Limited (Salvi) and AICO Laboratories India Ltd. (AICO) and exported to the United States from India is circumventing the antidumping duty order on glycine from the People’s Republic of China (China), as provided in section 781(b) of the Tariff Act of 1930, as amended (the Act).1 With respect to Paras Intermediates Pvt. Ltd. (Paras), we preliminarily find that Paras is not circumventing the Order because it is producing glycine from raw materials of Indian origin and exporting such merchandise to the United States. DATES: Effective Date: April 10, 2012. FOR FURTHER INFORMATION CONTACT: David Cordell, Dena Crossland, or Angelica Mendoza, AD/CVD Operations, Office 7, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue NW., Washington, DC 20230; telephone: (202) 482–0408, (202) 482– 3362, or (202) 482–3019, respectively. SUPPLEMENTARY INFORMATION: AGENCY: srobinson on DSK4SPTVN1PROD with NOTICES Background The Department of Commerce (the Department) issued the antidumping duty order on glycine from China in 1995. See Order. The Department conducted a less-than-fair value investigation on glycine from India in 2007 through 2008, covering the period of investigation of January 1 through December 31, 2006, where we found that certain Chinese glycine further processed in India did not change the country of origin of such glycine.2 1 See Antidumping Duty Order: Glycine From the People’s Republic of China, 60 FR 16116 (March 29, 1995) (Order). 2 See Notice of Final Determination of Sales at Less Than Fair Value: Glycine from India, 73 FR 16640 (March 28, 2008) (Indian Investigation) and VerDate Mar<15>2010 16:26 Apr 09, 2012 Jkt 226001 On December 18, 2009, GEO Specialty Chemicals, Inc. and Chattem Chemicals, Inc., domestic interested parties, requested that the Department initiate an anti-circumvention inquiry, pursuant to section 781(b) of the Act and 19 CFR 351.225(h), to determine whether U.S. imports of glycine exported by AICO and Paras, and made from Chineseorigin glycine, are circumventing the Order.3 In their request, domestic interested parties allege that AICO and Paras are circumventing the Order through completion and assembly in India of the same class or kind of merchandise that is subject to the Order and by labeling the merchandise as Indian origin. Id. On January 15, 2010, the Department requested that domestic interested parties resubmit legible copies of AICO’s financial statements and of the Port Import Export Reporting Service (PIERS) report regarding AICO’s shipments to the United States, which they provided in their original AntiCircumvention Allegation at Exhibits A and B, respectively. The legible copies of the requested documents were submitted by the domestic interested parties on January 22, 2010.4 On February 22, 2010, the Department requested additional information from the domestic interested parties in the form of a supplemental questionnaire. On August 19, 2010, the domestic interested parties submitted additional information to supplement their December 18, 2009 Anti-Circumvention Allegation and included another allegation against a third company, Salvi, and its exporter/affiliate, Nutracare International. As part of their supplemental submission and allegation against Salvi, domestic interested parties included a market survey from a foreign market researcher, at Exhibit 12 of its submission.5 In their August 19, 2010 supplemental circumvention allegation, the domestic interested accompanying Issues and Decision Memorandum at Comment 5. We note that this investigation did not result in an antidumping duty order because the International Trade Commission made a final negative injury determination. See Glycine From India; Determination, 73 FR 26413 (May 9, 2008); Glycine From India Investigation No. 731–TA–1111 (Final) Publication 3997 (United States International Trade Commission May 2008). 3 See Domestic Interested Parties’ request for an anti-circumvention inquiry entitled ‘‘Antidumping Duty Order on Glycine from the People’s Republic of China—Circumvention of Antidumping Duty Order,’’ dated December 18, 2009 (AntiCircumvention Allegation). 4 See Letter from the domestic interested parties to the Department, dated January 22, 2010. 5 See Letter from domestic interested parties to the Department, entitled ‘‘Antidumping Duty Order on Glycine from the People’s Republic of China— Supplement to Domestic Industry’s Request for Circumvention Inquiry,’’ dated August 19, 2010. PO 00000 Frm 00011 Fmt 4703 Sfmt 4703 parties alleged that all three Indian companies, i.e., AICO, Paras and Salvi, are importing technical-grade glycine from companies in China, processing and/or repackaging the Chinese-origin glycine, and then exporting the finished product to the United States, marked as Indian-origin glycine. Id. On September 23, 2010, the Department conducted a telephone interview with the foreign market researcher to corroborate the information in the market survey that the domestic interested parties submitted on August 19, 2010.6 On October 6, 2010, the domestic interested parties amended their request for the initiation of an anti-circumvention inquiry with respect to AICO, citing the Telephone Interview Memo.7 Therein, the domestic interested parties alleged that, based on the telephone interview, AICO is both repackaging and refining glycine of Chinese origin. Id. On October 22, 2010, based on sufficient record evidence, the Department initiated an anticircumvention inquiry on imports of glycine produced and/or exported by AICO, Paras, and Salvi.8 In the Initiation Notice, the Department explicitly stated that ‘‘{t}hese anticircumvention inquiries pertain solely to Paras, Salvi, and AICO.’’ Id. at 66356. The Department further stated that ‘‘{i}f, within sufficient time, the Department receives a formal request from an interested party regarding potential anticircumvention of the PRC Glycine Order by other Indian companies, we will consider conducting additional inquiries concurrently.’’ Id. As discussed below in the ‘‘Questionnaires’’ section, from December 2010 through October 2011, AICO, Paras, and Salvi responded to the Department’s initial and supplemental questionnaires. On October 3, 2011, the domestic interested parties submitted comments, in which they requested that the Department preliminarily determine that all glycine exported from India is within the scope of the Order unless U.S. importers certify that the product 6 See the Memorandum to the File, entitled ‘‘Antidumping Circumvention Inquiry: Telephone Interview with the Foreign Market Researcher,’’ dated October 5, 2010 (Telephone Interview Memo). 7 See Letter from domestic interested parties, entitled ‘‘Antidumping Duty Order on Glycine from the People’s Republic of China (PRC): Antidumping Circumvention Inquiry—Amendment to Domestic Industry’s Circumvention Allegation based on Department’s Memorandum to File,’’ dated October 6, 2010, at 2 (Amendment Letter). 8 See Glycine From the People’s Republic of China: Initiation of Antidumping Anticircumvention Inquiry, 75 FR 66352 (October 28, 2010) (Initiation Notice). E:\FR\FM\10APN1.SGM 10APN1 Federal Register / Vol. 77, No. 69 / Tuesday, April 10, 2012 / Notices srobinson on DSK4SPTVN1PROD with NOTICES they are importing from India is: (1) Not Chinese-origin or processed from Chinese-origin glycine, and (2) is Indian in origin. On October 3, 2011, Paras submitted a response to the domestic interested parties’ request to include Paras in any remedy that the Department may apply, arguing that it should not be subject to any remedy because it is not circumventing the Order.9 On November 23, 2011, the domestic interested parties submitted additional comments, in which they asked the Department to, based on record evidence, affirmatively determine that glycine shipments from India to the United States of the named respondents, including their affiliates and third-party business partners, have circumvented the Order. The domestic interested parties also requested the Department to require a U.S. importer certification scheme for all imports of Indian glycine, with the exception of imports from Salvi, AICO, and their related entities, for which the domestic interested parties requested the Department apply the current China-wide dumping rate of 155.89 percent. On November 28, 2011, Paras submitted comments rebutting the domestic interested parties’ request for a circumvention finding with respect to Paras, to which the domestic interested parties submitted a response on November 29, 2011. Paras submitted a rebuttal to the domestic interested parties’ response on November 30, 2011, reiterating their request with respect to Paras, and also arguing against an importer-based certification for circumvention findings with respect to further processing in a third country. On December 5, 2011, AICO and Avid Organics Pvt. Ltd. (Avid) 10 both responded to the domestic interested parties’ November 23, 2011, comments. On December 16, 2011, the domestic interested parties responded to AICO’s December 5, 2011, comments and on January 12, 2012, the domestic interested parties submitted comments responding to Avid Organics’ December 5, 2011 comments. On December 15, 2011, the Department notified parties that the deadlines for the preliminary and final 9 The domestic interested parties submitted further comments on the issue of its proposed remedy, with respect to Paras, on October 17, 2011, and November 4, 2011. Paras subsequently rebutted these comments on October 28, 2011, and November 8, 2011. 10 Avid, an Indian producer and exporter of glycine to the United States, entered a notice of appearance on December 7, 2011, in response to the domestic interested parties’ October 3, 2011, and November 23, 2011, comments alleging that Avid was affiliated with AICO. VerDate Mar<15>2010 16:26 Apr 09, 2012 Jkt 226001 determinations were March 30, 2012, and July 30, 2012, respectively.11 On February 2, 2012, Department officials met with counsel for the domestic interested parties concerning the alleged circumvention of the Order and the appropriate remedy.12 On February, 3, 2012, the domestic interested parties filed materials from the February 2, 2012, meeting on the record of the proceeding. On February 7, 2012, Paras submitted comments in response to the domestic interested parties’ submission of February 3, 2012. On February 10, 2012, the domestic interested parties submitted comments on the need for a country-wide remedy in this case, and on February 14, 2012, Paras submitted its response to those comments. Questionnaires On November 12, 2010, the Department issued questionnaires to AICO, Paras, and Salvi, requesting sales and production information with respect to the period January 1, 2005, to December 31, 2010, to which AICO, Paras, and Salvi responded in December 2010. Between February and October 2011, the Department issued supplemental questionnaires to AICO, Paras, and/or Salvi, to which timely responses were received. Period of Inquiry The inquiry period covers six years (i.e., 2005 through 2010), which includes the period covered by the Indian Investigation.13 In this case, the Department decided to use a broad period in order to better understand the glycine markets and how they operate. 11 Section 781(f) of the Act states that the Department shall, to the maximum extent practicable, make determinations under section 781 of the Act within 300 days from the date of the initiation of an antidumping circumvention inquiry. See also 19 CFR 351.225(f)(5). The Department deadline’s for the preliminary and final determinations were initially October 17, 2011, and February 14, 2012, respectively. See Letter to the Interested Parties from Richard Weible, Office Director, entitled ‘‘Anti-Circumvention Inquiry of the Anti-Dumping Order on Glycine from the People’s Republic of China: Extension of Final Determination,’’ dated April 25, 2011. On October 11, 2011, the Department notified parties that the new deadline for the preliminary determination was December 16, 2011. See Letter to the Interested Parties from Richard Weible, Office Director, entitled ‘‘Anti-Circumvention Inquiry of the AntiDumping Order on Glycine from the People’s Republic of China: Extension of Preliminary Determination,’’ dated October 11, 2011. 12 See Memorandum to File, entitled ‘‘Ex Parte meeting with Petitioners and Petitioner Counsel,’’ dated February 2, 2012. 13 The domestic interested parties did not specify an inquiry period in their December 18, 2009, anticircumvention inquiry request. PO 00000 Frm 00012 Fmt 4703 Sfmt 4703 21533 Scope of the Antidumping Duty Order The product covered by the antidumping duty order is glycine, which is a free-flowing crystalline material, like salt or sugar. Glycine is produced at varying levels of purity and is used as a sweetener/taste enhancer, a buffering agent, reabsorbable amino acid, chemical intermediate, and a metal complexing agent. This order covers glycine of all purity levels. Glycine is currently classified under subheading 2922.49.4020 of the Harmonized Tariff Schedule of the United States (HTSUS). Although the HTSUS subheading is provided for convenience and customs purposes, the written description of the merchandise under the order is dispositive. In a separate scope ruling, the Department determined that D(-) Phenylglycine Ethyl Dane Salt is outside the scope of the order. See Notice of Scope Rulings and Anticircumvention Inquiries, 62 FR 62288 (November 21, 1997). Scope of the Anti-Circumvention Inquiry The product covered by this inquiry is glycine, as described in the ‘‘Scope of the Antidumping Duty Order’’ section, above, which is exported from India, but processed using Chinese-origin inputs (e.g., technical-grade glycine). This inquiry covers glycine produced by AICO, Paras, and Salvi. Salvi and Paras have stated on the record that they also self-produce glycine from Indian-origin inputs. The focus of this proceeding is to determine whether the glycine is: (1) Manufactured in China; (2) processed by AICO, Paras, or Salvi in India; and (3) then exported to the United States as Indian-origin glycine that constitutes circumvention of the Order under section 781(b) of the Act. Statutory Provisions Regarding Circumvention Section 781(b) of the Act provides that the Department may find circumvention of an antidumping duty order when merchandise of the same class or kind of merchandise that is 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) of the Act, the Department relies upon the following criteria: (A) Merchandise imported into the United States is of the same class or kind as any merchandise produced in a foreign country that is subject to an antidumping duty order; (B) before importation into the United States, such E:\FR\FM\10APN1.SGM 10APN1 srobinson on DSK4SPTVN1PROD with NOTICES 21534 Federal Register / Vol. 77, No. 69 / Tuesday, April 10, 2012 / Notices imported merchandise is completed or assembled in another foreign country from merchandise which is subject to the order or produced in the foreign country that is subject to the order; (C) the process of assembly or completion in the foreign country referred to in (B) is minor or insignificant; (D) 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 (E) the administering authority determines that action is appropriate to prevent evasion of such order. Section 781(b)(2) of the Act provides the criteria for determining whether the process of assembly or completion is minor or insignificant. These criteria are: (a) The level of investment in the foreign country; (b) the level of research and development (R&D) in the foreign country; (c) the nature of the production process in the foreign country; (d) the extent of the production facilities in the foreign country; and (e) whether the value of the processing performed in the foreign country represents a small proportion of the value of the merchandise imported into the United States. The Statement of Administrative Action accompanying the Uruguay Round Agreements Act, H.R. Doc. 103– 316, vol. 1 at 893 (1994), provides some guidance with respect to these criteria. It explains that no single factor listed in section 781(b)(2) of the Act will be controlling and that the Department will evaluate each of the factors as they exist in the foreign country depending on the particular circumvention scenario. Id.; 19 CFR 351.225(h). Therefore, none of the factors listed under section 781(b)(2) of the Act are dispositive as they vary from case to case, depending on the particular circumstances unique to each circumvention inquiry. Section 781(b)(3) of the Act further provides that, in determining whether to include merchandise assembled or completed in a foreign country in an antidumping duty order, the Department shall consider: (A) The pattern of trade, including sourcing patterns; (B) whether the manufacturer or exporter of the merchandise described in section 781(b)(1)(B) of the Act is affiliated with the person who uses the merchandise described in section 781(b)(1)(B) of the Act to assemble or complete in the foreign country the merchandise that is subsequently imported into the United States; and (C) whether imports into the foreign country of the merchandise described in section 781(b)(1)(B) of the VerDate Mar<15>2010 16:26 Apr 09, 2012 Jkt 226001 Act have increased after the initiation of the investigation which resulted in the issuance of such order. Statutory Analysis A discussion of the record evidence pertaining to each company and the Department’s analyses are in the following analysis memoranda: (1) ‘‘Preliminary Analysis Memorandum for the Circumvention Inquiry of the Antidumping Duty Order on Glycine from the People’s Republic of China (China), for the Producer known as AICO Laboratories India Ltd. ’’ from Christian Marsh, Deputy Assistant Secretary, for Antidumping and Countervailing Duty Operations, to Paul Piquado, Assistant Secretary, for Import Administration, dated March 30, 2012 (AICO Preliminary Analysis Memorandum); (2) ‘‘Preliminary Analysis Memorandum for the Circumvention Inquiry of the Antidumping Duty Order on Glycine from the People’s Republic of China (China), for the Producer known as Paras Intermediates Pvt. Ltd. (Paras) from Christian Marsh, Deputy Assistant Secretary, for Antidumping and Countervailing Duty Operations, to Paul Piquado, Assistant Secretary, for Import Administration,’’ dated March 30, 2012 (Paras Preliminary Analysis Memorandum); and (3) ‘‘Preliminary Analysis Memorandum for the Circumvention Inquiry of the Antidumping Duty Order on Glycine from the People’s Republic of China (China), for the Producer known as Salvi Chemicals (Salvi)’’ from Christian Marsh, Deputy Assistant Secretary, for Antidumping and Countervailing Duty Operations, to Paul Piquado, Assistant Secretary, for Import Administration,’’ dated March 30, 2012 (Salvi Preliminary Analysis Memorandum). Parties can find public versions of these analysis memoranda on file electronically via Import Administration’s Antidumping and Countervailing Duty Centralized Electronic Service System (IA ACESS). Access to IA ACCESS is available in the Central Records Unit, room 7046, of the main Department of Commerce building. The signed analysis memoranda and the electronic versions of the analysis memoranda are identical in content. Preliminary Determinations With respect to AICO, the Department finds it necessary to rely on facts available, as AICO failed to provide necessary information in its questionnaire responses upon which the Department could rely and, thereby impeded this inquiry. Further, as discussed in detail the AICO PO 00000 Frm 00013 Fmt 4703 Sfmt 4703 Preliminary Analysis Memorandum, we find that AICO possessed the necessary information but failed to provide it, thus, it did not act to the best of its ability to comply with our requests for information. Therefore, we find it appropriate in this inquiry to apply facts available with an adverse inference as AICO failed to cooperate by not acting to the best of its ability in providing the necessary information. Accordingly, we preliminarily find, as facts otherwise available with an adverse inference pursuant to sections 776(a) and (b) of the Act, that AICO is circumventing the Order because it has withheld information by not fully responding to our requests for information and, when it has responded, provided ambiguous or contradictory responses, thereby impeding this proceeding. See sections 776(a)(2)(A) and (C) of the Act. Specifically, the record lacks information necessary to complete a proper analysis with respect to AICO. In addition and contrary to AICO’s claim, we find that there is no record evidence that AICO self produces glycine from Indian raw materials. Consequently, because AICO has not fully complied with the Department’s request for information, we find that it failed to cooperate to the best of its ability, and, therefore, that an adverse inference is warranted pursuant to section 776(b) of the Act. Accordingly, as an adverse inference the Department preliminarily finds that all glycine produced by AICO, regardless of exporter or U.S. importer, should be included within the scope of the Order. For a complete discussion of the Department’s analysis, see AICO Preliminary Analysis Memorandum. With respect to Salvi, for the reasons discussed in the Salvi Preliminary Analysis Memorandum, we preliminarily find that Salvi has circumvented the Order pursuant to section 781(b) of the Act. Specifically, pursuant to sections 781(b)(1)(A) and (B) of the Act, we find that the merchandise sold to the United States is within the same class or kind of merchandise that is subject to the Order and was assembled or completed in a third country. Additionally, pursuant to sections 781(b)(1)(C) and 781(b)(2) of the Act, we find that the processing of the Chinese-origin glycine into the glycine sold by Salvi is minor and insignificant. Furthermore, in accordance with section 781(b)(1)(D) of the Act, we find that the value of the merchandise produced in China is a significant portion of the total value of the merchandise exported to the United States. We also find that, in accordance with section 781(b)(1)(E) of the Act, E:\FR\FM\10APN1.SGM 10APN1 Federal Register / Vol. 77, No. 69 / Tuesday, April 10, 2012 / Notices action is appropriate to prevent evasion of the Order by Salvi. Moreover, we find that record evidence pertaining to the factors outlined in section 781(b)(3) of the Act support a finding of circumvention of the Order. For a complete discussion of the Department’s analysis, see Salvi Preliminary Analysis Memorandum. With respect to Paras, the Department preliminarily determines that Paras is not circumventing the Order. Although it has admitted to exporting processed Chinese-origin glycine in the past, the Department is satisfied that Paras understood that the processing it carried out was deemed by the Department in the original less-than-fair-value investigation as not substantial enough to transform the product into Indian origin. Also, once Paras became aware that such processing did not change the product into an Indian product, as a result of the less-than-fair-value investigation, it took steps to ensure that it would not continue to export Chineseorigin glycine to the United State. The record reflects that for approximately the past four years, Paras has only sold and/or exported to the United States glycine that it produced only from Indian raw materials. For a complete discussion of the Department’s analysis, see Paras Preliminary Analysis Memorandum. srobinson on DSK4SPTVN1PROD with NOTICES Scope Inquiry Initiation The Department has previously determined that the type of processing described by Salvi does not change the country of origin of glycine and therefore the glycine remains within the scope of the Order. Specifically, in a 2002 scope ruling, the Department concluded that processing Chineseglycine into refined glycine in a third country does not substantially transform the glycine and therefore does not change the country of origin or take such glycine out of the Order.14 In addition, in the Department’s lessthan-fair-value investigation of glycine from India, the Department determined that the further processing of imported Chinese-origin technical grade glycine to U.S. Pharmaceutical (USP) grade glycine in India did not substantially transform the glycine in India and, thus, the glycine remained Chinese in origin.15 It is important to note that 14 See Memorandum from Barbara E. Tillman to Joseph A. Spetrini, Deputy Assistant Secretary for Import Administration, Final Scope Ruling; Antidumping Duty Order on Glycine from the People’s Republic of China (A–570- 836); (Watson Industries Inc.), dated May 3, 2002; placed on the record by domestic interested parties in their December 18, 2009, submission at Exhibit D. 15 See Notice of Final Determination of Sales at Less Than Fair Value: Glycine from India, 73 FR VerDate Mar<15>2010 16:26 Apr 09, 2012 Jkt 226001 although the investigation of glycine from India did not go to order because of a negative injury determination by the U.S. International Trade Commission (the Commission) the Department’s decision with respect to the transformation of Chinese-origin glycine in India remains relevant.16 Notwithstanding, the Department recognizes that its scope determination in the original investigation was company- and fact-specific. As a result of the comments made by the parties in the instant proceeding with respect to substantial transformation and country of origin, and, as a result of our affirmative circumvention findings in light of prior scope determinations, we find that a broader scope inquiry in this case is warranted. Therefore, we are initiating a scope inquiry of Chineseorigin glycine processed into a purer grade glycine in India, pursuant to 19 CFR 351.225(b), and invite interested parties to submit comments and supporting factual information regarding glycine exported from India and the scope of the Order. In accordance with 19 CFR 351.225(f)(iii), interested parties may submit comments within 20 days of the publication of this notice. Additionally, interested parties may file rebuttals to written comments, limited to issues raised in such comments, no later than 10 days after the date on which the comments are due. Suspension of Liquidation As stated above, the Department has made a preliminary affirmative finding of circumvention of the Order by both AICO and Salvi. In accordance with 19 CFR 351.225(l)(2), the Department will direct U.S. Customs and Border Protection (CBP) to suspend liquidation and require a cash deposit of estimated duties at the applicable rate on all unliquidated entries of glycine produced by AICO or Salvi, regardless of exporter or U.S. importer, that were entered, or withdrawn from warehouse, for consumption on or after October 22, 2010, the date of initiation of the anticircumvention inquiry. We will require a cash deposit of estimated duties on all entries of glycine produced and/or exported by AICO and Salvi, at the China-wide rate of 155.89 percent, unless AICO or Salvi can demonstrate to CBP that the Chinese glycine, which was processed by AICO or Salvi, was 16640 (March 28, 2008), and accompanying Issues and Decision Memorandum at Comment 5. 16 See Glycine From India; Determination, 73 FR 26413 (May 9, 2008); Glycine From India Investigation No. 731–TA–1111 (Final) Publication 3997 (United States International Trade Commission) May 2008. PO 00000 Frm 00014 Fmt 4703 Sfmt 4703 21535 supplied by a Chinese manufacturer with its own rate. In that instance, the cash deposit rate will be the rate of the Chinese glycine manufacturer that has its own rate. In light of our preliminary determination that Paras is not circumventing the Order, the Department will not instruct CBP to suspend liquidation of any unliquidated entries of glycine produced by Paras for purposes of this preliminary determination. As stated above, in its October 3, 2011, submission, the domestic interested parties recommended that the Department determine that all Indian glycine is within the scope of the Order unless U.S. importers certify that the product they are importing is: (1) Not Chinese origin or processed from Chinese-origin glycine, and (2) is Indian in origin. Based on (i) our findings that not all Indian companies are circumventing the Order, (ii) the fact that our analysis only focused on three companies as requested by the domestic interested parties, (iii) record evidence indicating that certification may have unintended effects in this particular case, and (iv) lack of evidence on the record demonstrating that circumvention is occurring more broadly, we preliminarily find that a certification requirement is not supported by the record. We invite parties to comment on a country-wide exporter or importer certification process for glycine exported from India, and how such a certification program might be implemented. Notification to the U.S. International Trade Commission The Department, consistent with section 781(e) of the Act and 19 CFR 351.225(f)(7)(i)(B), will notify the U.S. International Trade Commission (ITC) of this preliminary determination to include merchandise subject to this inquiry (i.e., glycine) within the Order. The ITC may request consultations concerning the Department’s proposed inclusion of the subject merchandise. See section 781(e)(2) of the Act. Upon the request of the ITC, the administering authority shall consult with the ITC and any such consultation shall be completed within 15 days after the date of the request. Id. If, after consultations, the ITC believes that a significant injury issue is presented by the proposed inclusion, it will have 60 days to provide written advice to the Department. See section 781(e)(3) of the Act. Public Comment Interested parties are invited to comment on the preliminary results and E:\FR\FM\10APN1.SGM 10APN1 21536 Federal Register / Vol. 77, No. 69 / Tuesday, April 10, 2012 / Notices may submit case briefs and/or written comments within 20 days of the publication of this notice. See 19 CFR 351.225(f)(3). Interested parties may file rebuttal briefs and rebuttals to written comments, limited to issues raised in such briefs or comments, no later than 10 days after the date on which the case briefs are due. Id. Interested parties may request a hearing within 20 days of the publication of this notice. Requests should contain the party’s name, address, and telephone number, the number of participants, and a list of the issues to be discussed. At the hearing, each party may make an affirmative presentation only on issues raised in that party’s case brief and may make rebuttal presentations only on arguments included in that party’s rebuttal brief. Interested parties will be notified by the Department of the location and time of any hearing, if one is requested. Final Determination The final determination with respect to this circumvention inquiry, including the results of the Department’s analysis of any written comments, will be issued no later than July 30, 2012, unless extended. See section 781(f) of the Act and 19 CFR 351.302(b). This preliminary partial affirmative circumvention determination is published in accordance with section 781(b) of the Act and 19 CFR 351.225. Dated: March 30, 2012. Paul Piquado, Assistant Secretary for Import Administration. [FR Doc. 2012–8597 Filed 4–9–12; 8:45 am] BILLING CODE 3510–DS–P DEPARTMENT OF COMMERCE International Trade Administration [A–570–890] Wooden Bedroom Furniture From the People’s Republic of China: Final Rescission of Antidumping Duty New Shipper Review Import Administration, International Trade Administration, Department of Commerce. SUMMARY: On January 10, 2012, the Department of Commerce (the ‘‘Department’’) published the preliminary rescission of the new shipper review (‘‘NSR’’) of wooden bedroom furniture (‘‘WBF’’) from the People’s Republic of China (‘‘PRC’’) covering the period of review (‘‘POR’’) srobinson on DSK4SPTVN1PROD with NOTICES AGENCY: VerDate Mar<15>2010 16:26 Apr 09, 2012 Jkt 226001 January 1, 2011, through June 30, 2011.1 After analyzing the comments submitted by parties with respect to Marvin Furniture (Shanghai) Co., Ltd. (‘‘Marvin Furniture’’), the Department continues to find that Marvin Furniture failed to satisfy the requirements for an NSR. Therefore, the Department is rescinding Marvin Furniture’s NSR. DATES: Effective Date: April 10, 2012. FOR FURTHER INFORMATION CONTACT: Patrick O’Connor, AD/CVD Operations, Office 4, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue NW., Washington, DC 20230; telephone: (202) 482–0989. SUPPLEMENTARY INFORMATION: is hereby adopted by this notice. The issue which parties raised, and to which we respond, in the I&D Memorandum is whether to rescind the NSR for Marvin Furniture. The I&D Memorandum is a public document and is on file electronically via Import Administration’s Antidumping and Countervailing Duty Centralized Electronic Services System (‘‘IA ACCESS’’). Access to IA ACCESS is available in the Central Records Unit of the main Commerce Building, Room 7046. In addition, a complete version of the I&D Memorandum is accessible on the Department’s web site at https:// www.trade.gov/ia/. The paper copy and electronic versions of the I&D Memorandum are identical in content. Background On January 10, 2012, the Department published the Preliminary Rescission of this NSR.2 On February 9, 2012, we received case briefs and a request for a hearing from Marvin Furniture. On February 16, 2012, the Department rejected Marvin Furniture’s case brief because it contained untimely factual information. The Department informed Marvin Furniture that it could re-file its case brief by February 17, 2012, after removing the untimely factual information in the brief. On February 17, 2012, Marvin Furniture re-filed its case brief after removing the information at issue but protested the finding that its case brief contained untimely factual information. On February 17, 2012, we received rebuttal briefs from the American Furniture Manufacturers Committee for Legal Trade and Vaughan-Basset Furniture Company, Inc. (collectively, ‘‘Petitioners’’). On March 7, 2012, the Department held a closed hearing. Scope of the Order Analysis of the Comments Received All issues raised in the case and rebuttal briefs submitted by parties in this review are addressed in the memorandum from Gary Taverman, Acting Deputy Assistant Secretary for Antidumping and Countervailing Duty Operations, to Paul Piquado, Assistant Secretary for Import Administration, ‘‘Issues and Decision Memorandum for the Final Rescission of the New Shipper Review of Wooden Bedroom Furniture from the People’s Republic of China for Marvin Furniture (Shanghai) Co., Ltd.’’ (‘‘I&D Memorandum’’), which is dated concurrently with this notice and which The product covered by the order is wooden bedroom furniture. Wooden bedroom furniture is generally, but not exclusively, designed, manufactured, and offered for sale in coordinated groups, or bedrooms, in which all of the individual pieces are of approximately the same style and approximately the same material and/or finish. The subject merchandise is made substantially of wood products, including both solid wood and also engineered wood products made from wood particles, fibers, or other wooden materials such as plywood, strand board, particle board, and fiberboard, with or without wood veneers, wood overlays, or laminates, with or without non-wood components or trim such as metal, marble, leather, glass, plastic, or other resins, and whether or not assembled, completed, or finished. The subject merchandise includes the following items: (1) Wooden beds such as loft beds, bunk beds, and other beds; (2) wooden headboards for beds (whether stand-alone or attached to side rails), wooden footboards for beds, wooden side rails for beds, and wooden canopies for beds; (3) night tables, night stands, dressers, commodes, bureaus, mule chests, gentlemen’s chests, bachelor’s chests, lingerie chests, wardrobes, vanities, chessers, chifforobes, and wardrobe-type cabinets; (4) dressers with framed glass mirrors that are attached to, incorporated in, sit on, or hang over the dresser; (5) chests- 1 See Wooden Bedroom Furniture From the People’s Republic of China: Preliminary Rescission of Antidumping Duty New Shipper Review, 77 FR 1456 (January 10, 2012) (‘‘Preliminary Rescission’’). 2 See Preliminary Rescission. PO 00000 Frm 00015 Fmt 4703 Sfmt 4703 E:\FR\FM\10APN1.SGM 10APN1

Agencies

[Federal Register Volume 77, Number 69 (Tuesday, April 10, 2012)]
[Notices]
[Pages 21532-21536]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-8597]


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DEPARTMENT OF COMMERCE

International Trade Administration

[A-570-836]


Glycine From the People's Republic of China: Preliminary Partial 
Affirmative Determination of Circumvention of the Antidumping Duty 
Order and Initiation of Scope Inquiry

AGENCY: Import Administration, International Trade Administration, 
Department of Commerce.

SUMMARY: We preliminarily determine that glycine processed by Salvi 
Chemical Industries Limited (Salvi) and AICO Laboratories India Ltd. 
(AICO) and exported to the United States from India is circumventing 
the antidumping duty order on glycine from the People's Republic of 
China (China), as provided in section 781(b) of the Tariff Act of 1930, 
as amended (the Act).\1\ With respect to Paras Intermediates Pvt. Ltd. 
(Paras), we preliminarily find that Paras is not circumventing the 
Order because it is producing glycine from raw materials of Indian 
origin and exporting such merchandise to the United States.
---------------------------------------------------------------------------

    \1\ See Antidumping Duty Order: Glycine From the People's 
Republic of China, 60 FR 16116 (March 29, 1995) (Order).

---------------------------------------------------------------------------
DATES: Effective Date: April 10, 2012.

FOR FURTHER INFORMATION CONTACT: David Cordell, Dena Crossland, or 
Angelica Mendoza, AD/CVD Operations, Office 7, Import Administration, 
International Trade Administration, U.S. Department of Commerce, 14th 
Street and Constitution Avenue NW., Washington, DC 20230; telephone: 
(202) 482-0408, (202) 482-3362, or (202) 482-3019, respectively.

SUPPLEMENTARY INFORMATION:

Background

    The Department of Commerce (the Department) issued the antidumping 
duty order on glycine from China in 1995. See Order. The Department 
conducted a less-than-fair value investigation on glycine from India in 
2007 through 2008, covering the period of investigation of January 1 
through December 31, 2006, where we found that certain Chinese glycine 
further processed in India did not change the country of origin of such 
glycine.\2\
---------------------------------------------------------------------------

    \2\ See Notice of Final Determination of Sales at Less Than Fair 
Value: Glycine from India, 73 FR 16640 (March 28, 2008) (Indian 
Investigation) and accompanying Issues and Decision Memorandum at 
Comment 5. We note that this investigation did not result in an 
antidumping duty order because the International Trade Commission 
made a final negative injury determination. See Glycine From India; 
Determination, 73 FR 26413 (May 9, 2008); Glycine From India 
Investigation No. 731-TA-1111 (Final) Publication 3997 (United 
States International Trade Commission May 2008).
---------------------------------------------------------------------------

    On December 18, 2009, GEO Specialty Chemicals, Inc. and Chattem 
Chemicals, Inc., domestic interested parties, requested that the 
Department initiate an anti-circumvention inquiry, pursuant to section 
781(b) of the Act and 19 CFR 351.225(h), to determine whether U.S. 
imports of glycine exported by AICO and Paras, and made from Chinese-
origin glycine, are circumventing the Order.\3\ In their request, 
domestic interested parties allege that AICO and Paras are 
circumventing the Order through completion and assembly in India of the 
same class or kind of merchandise that is subject to the Order and by 
labeling the merchandise as Indian origin. Id.
---------------------------------------------------------------------------

    \3\ See Domestic Interested Parties' request for an anti-
circumvention inquiry entitled ``Antidumping Duty Order on Glycine 
from the People's Republic of China--Circumvention of Antidumping 
Duty Order,'' dated December 18, 2009 (Anti-Circumvention 
Allegation).
---------------------------------------------------------------------------

    On January 15, 2010, the Department requested that domestic 
interested parties resubmit legible copies of AICO's financial 
statements and of the Port Import Export Reporting Service (PIERS) 
report regarding AICO's shipments to the United States, which they 
provided in their original Anti-Circumvention Allegation at Exhibits A 
and B, respectively. The legible copies of the requested documents were 
submitted by the domestic interested parties on January 22, 2010.\4\ On 
February 22, 2010, the Department requested additional information from 
the domestic interested parties in the form of a supplemental 
questionnaire.
---------------------------------------------------------------------------

    \4\ See Letter from the domestic interested parties to the 
Department, dated January 22, 2010.
---------------------------------------------------------------------------

    On August 19, 2010, the domestic interested parties submitted 
additional information to supplement their December 18, 2009 Anti-
Circumvention Allegation and included another allegation against a 
third company, Salvi, and its exporter/affiliate, Nutracare 
International. As part of their supplemental submission and allegation 
against Salvi, domestic interested parties included a market survey 
from a foreign market researcher, at Exhibit 12 of its submission.\5\ 
In their August 19, 2010 supplemental circumvention allegation, the 
domestic interested parties alleged that all three Indian companies, 
i.e., AICO, Paras and Salvi, are importing technical-grade glycine from 
companies in China, processing and/or repackaging the Chinese-origin 
glycine, and then exporting the finished product to the United States, 
marked as Indian-origin glycine. Id.
---------------------------------------------------------------------------

    \5\ See Letter from domestic interested parties to the 
Department, entitled ``Antidumping Duty Order on Glycine from the 
People's Republic of China--Supplement to Domestic Industry's 
Request for Circumvention Inquiry,'' dated August 19, 2010.
---------------------------------------------------------------------------

    On September 23, 2010, the Department conducted a telephone 
interview with the foreign market researcher to corroborate the 
information in the market survey that the domestic interested parties 
submitted on August 19, 2010.\6\ On October 6, 2010, the domestic 
interested parties amended their request for the initiation of an anti-
circumvention inquiry with respect to AICO, citing the Telephone 
Interview Memo.\7\ Therein, the domestic interested parties alleged 
that, based on the telephone interview, AICO is both repackaging and 
refining glycine of Chinese origin. Id.
---------------------------------------------------------------------------

    \6\ See the Memorandum to the File, entitled ``Antidumping 
Circumvention Inquiry: Telephone Interview with the Foreign Market 
Researcher,'' dated October 5, 2010 (Telephone Interview Memo).
    \7\ See Letter from domestic interested parties, entitled 
``Antidumping Duty Order on Glycine from the People's Republic of 
China (PRC): Antidumping Circumvention Inquiry--Amendment to 
Domestic Industry's Circumvention Allegation based on Department's 
Memorandum to File,'' dated October 6, 2010, at 2 (Amendment 
Letter).
---------------------------------------------------------------------------

    On October 22, 2010, based on sufficient record evidence, the 
Department initiated an anti-circumvention inquiry on imports of 
glycine produced and/or exported by AICO, Paras, and Salvi.\8\ In the 
Initiation Notice, the Department explicitly stated that 
``{t{time} hese anticircumvention inquiries pertain solely to Paras, 
Salvi, and AICO.'' Id. at 66356. The Department further stated that 
``{i{time} f, within sufficient time, the Department receives a formal 
request from an interested party regarding potential anti-circumvention 
of the PRC Glycine Order by other Indian companies, we will consider 
conducting additional inquiries concurrently.'' Id.
---------------------------------------------------------------------------

    \8\ See Glycine From the People's Republic of China: Initiation 
of Antidumping Anticircumvention Inquiry, 75 FR 66352 (October 28, 
2010) (Initiation Notice).
---------------------------------------------------------------------------

    As discussed below in the ``Questionnaires'' section, from December 
2010 through October 2011, AICO, Paras, and Salvi responded to the 
Department's initial and supplemental questionnaires.
    On October 3, 2011, the domestic interested parties submitted 
comments, in which they requested that the Department preliminarily 
determine that all glycine exported from India is within the scope of 
the Order unless U.S. importers certify that the product

[[Page 21533]]

they are importing from India is: (1) Not Chinese-origin or processed 
from Chinese-origin glycine, and (2) is Indian in origin. On October 3, 
2011, Paras submitted a response to the domestic interested parties' 
request to include Paras in any remedy that the Department may apply, 
arguing that it should not be subject to any remedy because it is not 
circumventing the Order.\9\
---------------------------------------------------------------------------

    \9\ The domestic interested parties submitted further comments 
on the issue of its proposed remedy, with respect to Paras, on 
October 17, 2011, and November 4, 2011. Paras subsequently rebutted 
these comments on October 28, 2011, and November 8, 2011.
---------------------------------------------------------------------------

    On November 23, 2011, the domestic interested parties submitted 
additional comments, in which they asked the Department to, based on 
record evidence, affirmatively determine that glycine shipments from 
India to the United States of the named respondents, including their 
affiliates and third-party business partners, have circumvented the 
Order. The domestic interested parties also requested the Department to 
require a U.S. importer certification scheme for all imports of Indian 
glycine, with the exception of imports from Salvi, AICO, and their 
related entities, for which the domestic interested parties requested 
the Department apply the current China-wide dumping rate of 155.89 
percent.
    On November 28, 2011, Paras submitted comments rebutting the 
domestic interested parties' request for a circumvention finding with 
respect to Paras, to which the domestic interested parties submitted a 
response on November 29, 2011. Paras submitted a rebuttal to the 
domestic interested parties' response on November 30, 2011, reiterating 
their request with respect to Paras, and also arguing against an 
importer-based certification for circumvention findings with respect to 
further processing in a third country.
    On December 5, 2011, AICO and Avid Organics Pvt. Ltd. (Avid) \10\ 
both responded to the domestic interested parties' November 23, 2011, 
comments. On December 16, 2011, the domestic interested parties 
responded to AICO's December 5, 2011, comments and on January 12, 2012, 
the domestic interested parties submitted comments responding to Avid 
Organics' December 5, 2011 comments.
---------------------------------------------------------------------------

    \10\ Avid, an Indian producer and exporter of glycine to the 
United States, entered a notice of appearance on December 7, 2011, 
in response to the domestic interested parties' October 3, 2011, and 
November 23, 2011, comments alleging that Avid was affiliated with 
AICO.
---------------------------------------------------------------------------

    On December 15, 2011, the Department notified parties that the 
deadlines for the preliminary and final determinations were March 30, 
2012, and July 30, 2012, respectively.\11\
---------------------------------------------------------------------------

    \11\ Section 781(f) of the Act states that the Department shall, 
to the maximum extent practicable, make determinations under section 
781 of the Act within 300 days from the date of the initiation of an 
antidumping circumvention inquiry. See also 19 CFR 351.225(f)(5). 
The Department deadline's for the preliminary and final 
determinations were initially October 17, 2011, and February 14, 
2012, respectively. See Letter to the Interested Parties from 
Richard Weible, Office Director, entitled ``Anti-Circumvention 
Inquiry of the Anti-Dumping Order on Glycine from the People's 
Republic of China: Extension of Final Determination,'' dated April 
25, 2011. On October 11, 2011, the Department notified parties that 
the new deadline for the preliminary determination was December 16, 
2011. See Letter to the Interested Parties from Richard Weible, 
Office Director, entitled ``Anti-Circumvention Inquiry of the Anti-
Dumping Order on Glycine from the People's Republic of China: 
Extension of Preliminary Determination,'' dated October 11, 2011.
---------------------------------------------------------------------------

    On February 2, 2012, Department officials met with counsel for the 
domestic interested parties concerning the alleged circumvention of the 
Order and the appropriate remedy.\12\ On February, 3, 2012, the 
domestic interested parties filed materials from the February 2, 2012, 
meeting on the record of the proceeding. On February 7, 2012, Paras 
submitted comments in response to the domestic interested parties' 
submission of February 3, 2012.
---------------------------------------------------------------------------

    \12\ See Memorandum to File, entitled ``Ex Parte meeting with 
Petitioners and Petitioner Counsel,'' dated February 2, 2012.
---------------------------------------------------------------------------

    On February 10, 2012, the domestic interested parties submitted 
comments on the need for a country-wide remedy in this case, and on 
February 14, 2012, Paras submitted its response to those comments.

Questionnaires

    On November 12, 2010, the Department issued questionnaires to AICO, 
Paras, and Salvi, requesting sales and production information with 
respect to the period January 1, 2005, to December 31, 2010, to which 
AICO, Paras, and Salvi responded in December 2010. Between February and 
October 2011, the Department issued supplemental questionnaires to 
AICO, Paras, and/or Salvi, to which timely responses were received.

Period of Inquiry

    The inquiry period covers six years (i.e., 2005 through 2010), 
which includes the period covered by the Indian Investigation.\13\ In 
this case, the Department decided to use a broad period in order to 
better understand the glycine markets and how they operate.
---------------------------------------------------------------------------

    \13\ The domestic interested parties did not specify an inquiry 
period in their December 18, 2009, anti-circumvention inquiry 
request.
---------------------------------------------------------------------------

Scope of the Antidumping Duty Order

    The product covered by the antidumping duty order is glycine, which 
is a free-flowing crystalline material, like salt or sugar. Glycine is 
produced at varying levels of purity and is used as a sweetener/taste 
enhancer, a buffering agent, reabsorbable amino acid, chemical 
intermediate, and a metal complexing agent. This order covers glycine 
of all purity levels. Glycine is currently classified under subheading 
2922.49.4020 of the Harmonized Tariff Schedule of the United States 
(HTSUS). Although the HTSUS subheading is provided for convenience and 
customs purposes, the written description of the merchandise under the 
order is dispositive.
    In a separate scope ruling, the Department determined that D(-) 
Phenylglycine Ethyl Dane Salt is outside the scope of the order. See 
Notice of Scope Rulings and Anticircumvention Inquiries, 62 FR 62288 
(November 21, 1997).

Scope of the Anti-Circumvention Inquiry

    The product covered by this inquiry is glycine, as described in the 
``Scope of the Antidumping Duty Order'' section, above, which is 
exported from India, but processed using Chinese-origin inputs (e.g., 
technical-grade glycine). This inquiry covers glycine produced by AICO, 
Paras, and Salvi. Salvi and Paras have stated on the record that they 
also self-produce glycine from Indian-origin inputs. The focus of this 
proceeding is to determine whether the glycine is: (1) Manufactured in 
China; (2) processed by AICO, Paras, or Salvi in India; and (3) then 
exported to the United States as Indian-origin glycine that constitutes 
circumvention of the Order under section 781(b) of the Act.

Statutory Provisions Regarding Circumvention

    Section 781(b) of the Act provides that the Department may find 
circumvention of an antidumping duty order when merchandise of the same 
class or kind of merchandise that is 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) of the Act, the Department relies upon the following criteria: 
(A) Merchandise imported into the United States is of the same class or 
kind as any merchandise produced in a foreign country that is subject 
to an antidumping duty order; (B) before importation into the United 
States, such

[[Page 21534]]

imported merchandise is completed or assembled in another foreign 
country from merchandise which is subject to the order or produced in 
the foreign country that is subject to the order; (C) the process of 
assembly or completion in the foreign country referred to in (B) is 
minor or insignificant; (D) 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 (E) the administering authority determines that 
action is appropriate to prevent evasion of such order.
    Section 781(b)(2) of the Act provides the criteria for determining 
whether the process of assembly or completion is minor or 
insignificant. These criteria are: (a) The level of investment in the 
foreign country; (b) the level of research and development (R&D) in the 
foreign country; (c) the nature of the production process in the 
foreign country; (d) the extent of the production facilities in the 
foreign country; and (e) whether the value of the processing performed 
in the foreign country represents a small proportion of the value of 
the merchandise imported into the United States.
    The Statement of Administrative Action accompanying the Uruguay 
Round Agreements Act, H.R. Doc. 103-316, vol. 1 at 893 (1994), provides 
some guidance with respect to these criteria. It explains that no 
single factor listed in section 781(b)(2) of the Act will be 
controlling and that the Department will evaluate each of the factors 
as they exist in the foreign country depending on the particular 
circumvention scenario. Id.; 19 CFR 351.225(h). Therefore, none of the 
factors listed under section 781(b)(2) of the Act are dispositive as 
they vary from case to case, depending on the particular circumstances 
unique to each circumvention inquiry.
    Section 781(b)(3) of the Act further provides that, in determining 
whether to include merchandise assembled or completed in a foreign 
country in an antidumping duty order, the Department shall consider: 
(A) The pattern of trade, including sourcing patterns; (B) whether the 
manufacturer or exporter of the merchandise described in section 
781(b)(1)(B) of the Act is affiliated with the person who uses the 
merchandise described in section 781(b)(1)(B) of the Act to assemble or 
complete in the foreign country the merchandise that is subsequently 
imported into the United States; and (C) whether imports into the 
foreign country of the merchandise described in section 781(b)(1)(B) of 
the Act have increased after the initiation of the investigation which 
resulted in the issuance of such order.

Statutory Analysis

    A discussion of the record evidence pertaining to each company and 
the Department's analyses are in the following analysis memoranda: (1) 
``Preliminary Analysis Memorandum for the Circumvention Inquiry of the 
Antidumping Duty Order on Glycine from the People's Republic of China 
(China), for the Producer known as AICO Laboratories India Ltd. '' from 
Christian Marsh, Deputy Assistant Secretary, for Antidumping and 
Countervailing Duty Operations, to Paul Piquado, Assistant Secretary, 
for Import Administration, dated March 30, 2012 (AICO Preliminary 
Analysis Memorandum); (2) ``Preliminary Analysis Memorandum for the 
Circumvention Inquiry of the Antidumping Duty Order on Glycine from the 
People's Republic of China (China), for the Producer known as Paras 
Intermediates Pvt. Ltd. (Paras) from Christian Marsh, Deputy Assistant 
Secretary, for Antidumping and Countervailing Duty Operations, to Paul 
Piquado, Assistant Secretary, for Import Administration,'' dated March 
30, 2012 (Paras Preliminary Analysis Memorandum); and (3) ``Preliminary 
Analysis Memorandum for the Circumvention Inquiry of the Antidumping 
Duty Order on Glycine from the People's Republic of China (China), for 
the Producer known as Salvi Chemicals (Salvi)'' from Christian Marsh, 
Deputy Assistant Secretary, for Antidumping and Countervailing Duty 
Operations, to Paul Piquado, Assistant Secretary, for Import 
Administration,'' dated March 30, 2012 (Salvi Preliminary Analysis 
Memorandum). Parties can find public versions of these analysis 
memoranda on file electronically via Import Administration's 
Antidumping and Countervailing Duty Centralized Electronic Service 
System (IA ACESS). Access to IA ACCESS is available in the Central 
Records Unit, room 7046, of the main Department of Commerce building. 
The signed analysis memoranda and the electronic versions of the 
analysis memoranda are identical in content.

Preliminary Determinations

    With respect to AICO, the Department finds it necessary to rely on 
facts available, as AICO failed to provide necessary information in its 
questionnaire responses upon which the Department could rely and, 
thereby impeded this inquiry. Further, as discussed in detail the AICO 
Preliminary Analysis Memorandum, we find that AICO possessed the 
necessary information but failed to provide it, thus, it did not act to 
the best of its ability to comply with our requests for information. 
Therefore, we find it appropriate in this inquiry to apply facts 
available with an adverse inference as AICO failed to cooperate by not 
acting to the best of its ability in providing the necessary 
information. Accordingly, we preliminarily find, as facts otherwise 
available with an adverse inference pursuant to sections 776(a) and (b) 
of the Act, that AICO is circumventing the Order because it has 
withheld information by not fully responding to our requests for 
information and, when it has responded, provided ambiguous or 
contradictory responses, thereby impeding this proceeding. See sections 
776(a)(2)(A) and (C) of the Act. Specifically, the record lacks 
information necessary to complete a proper analysis with respect to 
AICO. In addition and contrary to AICO's claim, we find that there is 
no record evidence that AICO self produces glycine from Indian raw 
materials. Consequently, because AICO has not fully complied with the 
Department's request for information, we find that it failed to 
cooperate to the best of its ability, and, therefore, that an adverse 
inference is warranted pursuant to section 776(b) of the Act. 
Accordingly, as an adverse inference the Department preliminarily finds 
that all glycine produced by AICO, regardless of exporter or U.S. 
importer, should be included within the scope of the Order. For a 
complete discussion of the Department's analysis, see AICO Preliminary 
Analysis Memorandum.
    With respect to Salvi, for the reasons discussed in the Salvi 
Preliminary Analysis Memorandum, we preliminarily find that Salvi has 
circumvented the Order pursuant to section 781(b) of the Act. 
Specifically, pursuant to sections 781(b)(1)(A) and (B) of the Act, we 
find that the merchandise sold to the United States is within the same 
class or kind of merchandise that is subject to the Order and was 
assembled or completed in a third country. Additionally, pursuant to 
sections 781(b)(1)(C) and 781(b)(2) of the Act, we find that the 
processing of the Chinese-origin glycine into the glycine sold by Salvi 
is minor and insignificant. Furthermore, in accordance with section 
781(b)(1)(D) of the Act, we find that the value of the merchandise 
produced in China is a significant portion of the total value of the 
merchandise exported to the United States. We also find that, in 
accordance with section 781(b)(1)(E) of the Act,

[[Page 21535]]

action is appropriate to prevent evasion of the Order by Salvi. 
Moreover, we find that record evidence pertaining to the factors 
outlined in section 781(b)(3) of the Act support a finding of 
circumvention of the Order. For a complete discussion of the 
Department's analysis, see Salvi Preliminary Analysis Memorandum.
    With respect to Paras, the Department preliminarily determines that 
Paras is not circumventing the Order. Although it has admitted to 
exporting processed Chinese-origin glycine in the past, the Department 
is satisfied that Paras understood that the processing it carried out 
was deemed by the Department in the original less-than-fair-value 
investigation as not substantial enough to transform the product into 
Indian origin. Also, once Paras became aware that such processing did 
not change the product into an Indian product, as a result of the less-
than-fair-value investigation, it took steps to ensure that it would 
not continue to export Chinese-origin glycine to the United State. The 
record reflects that for approximately the past four years, Paras has 
only sold and/or exported to the United States glycine that it produced 
only from Indian raw materials. For a complete discussion of the 
Department's analysis, see Paras Preliminary Analysis Memorandum.

Scope Inquiry Initiation

    The Department has previously determined that the type of 
processing described by Salvi does not change the country of origin of 
glycine and therefore the glycine remains within the scope of the 
Order. Specifically, in a 2002 scope ruling, the Department concluded 
that processing Chinese-glycine into refined glycine in a third country 
does not substantially transform the glycine and therefore does not 
change the country of origin or take such glycine out of the Order.\14\
---------------------------------------------------------------------------

    \14\ See Memorandum from Barbara E. Tillman to Joseph A. 
Spetrini, Deputy Assistant Secretary for Import Administration, 
Final Scope Ruling; Antidumping Duty Order on Glycine from the 
People's Republic of China (A-570- 836); (Watson Industries Inc.), 
dated May 3, 2002; placed on the record by domestic interested 
parties in their December 18, 2009, submission at Exhibit D.
---------------------------------------------------------------------------

    In addition, in the Department's less-than-fair-value investigation 
of glycine from India, the Department determined that the further 
processing of imported Chinese-origin technical grade glycine to U.S. 
Pharmaceutical (USP) grade glycine in India did not substantially 
transform the glycine in India and, thus, the glycine remained Chinese 
in origin.\15\ It is important to note that although the investigation 
of glycine from India did not go to order because of a negative injury 
determination by the U.S. International Trade Commission (the 
Commission) the Department's decision with respect to the 
transformation of Chinese-origin glycine in India remains relevant.\16\ 
Notwithstanding, the Department recognizes that its scope determination 
in the original investigation was company- and fact-specific. As a 
result of the comments made by the parties in the instant proceeding 
with respect to substantial transformation and country of origin, and, 
as a result of our affirmative circumvention findings in light of prior 
scope determinations, we find that a broader scope inquiry in this case 
is warranted. Therefore, we are initiating a scope inquiry of Chinese-
origin glycine processed into a purer grade glycine in India, pursuant 
to 19 CFR 351.225(b), and invite interested parties to submit comments 
and supporting factual information regarding glycine exported from 
India and the scope of the Order. In accordance with 19 CFR 
351.225(f)(iii), interested parties may submit comments within 20 days 
of the publication of this notice. Additionally, interested parties may 
file rebuttals to written comments, limited to issues raised in such 
comments, no later than 10 days after the date on which the comments 
are due.
---------------------------------------------------------------------------

    \15\ See Notice of Final Determination of Sales at Less Than 
Fair Value: Glycine from India, 73 FR 16640 (March 28, 2008), and 
accompanying Issues and Decision Memorandum at Comment 5.
    \16\ See Glycine From India; Determination, 73 FR 26413 (May 9, 
2008); Glycine From India Investigation No. 731-TA-1111 (Final) 
Publication 3997 (United States International Trade Commission) May 
2008.
---------------------------------------------------------------------------

Suspension of Liquidation

    As stated above, the Department has made a preliminary affirmative 
finding of circumvention of the Order by both AICO and Salvi. In 
accordance with 19 CFR 351.225(l)(2), the Department will direct U.S. 
Customs and Border Protection (CBP) to suspend liquidation and require 
a cash deposit of estimated duties at the applicable rate on all 
unliquidated entries of glycine produced by AICO or Salvi, regardless 
of exporter or U.S. importer, that were entered, or withdrawn from 
warehouse, for consumption on or after October 22, 2010, the date of 
initiation of the anti-circumvention inquiry. We will require a cash 
deposit of estimated duties on all entries of glycine produced and/or 
exported by AICO and Salvi, at the China-wide rate of 155.89 percent, 
unless AICO or Salvi can demonstrate to CBP that the Chinese glycine, 
which was processed by AICO or Salvi, was supplied by a Chinese 
manufacturer with its own rate. In that instance, the cash deposit rate 
will be the rate of the Chinese glycine manufacturer that has its own 
rate. In light of our preliminary determination that Paras is not 
circumventing the Order, the Department will not instruct CBP to 
suspend liquidation of any unliquidated entries of glycine produced by 
Paras for purposes of this preliminary determination.
    As stated above, in its October 3, 2011, submission, the domestic 
interested parties recommended that the Department determine that all 
Indian glycine is within the scope of the Order unless U.S. importers 
certify that the product they are importing is: (1) Not Chinese origin 
or processed from Chinese-origin glycine, and (2) is Indian in origin. 
Based on (i) our findings that not all Indian companies are 
circumventing the Order, (ii) the fact that our analysis only focused 
on three companies as requested by the domestic interested parties, 
(iii) record evidence indicating that certification may have unintended 
effects in this particular case, and (iv) lack of evidence on the 
record demonstrating that circumvention is occurring more broadly, we 
preliminarily find that a certification requirement is not supported by 
the record. We invite parties to comment on a country-wide exporter or 
importer certification process for glycine exported from India, and how 
such a certification program might be implemented.

Notification to the U.S. International Trade Commission

    The Department, consistent with section 781(e) of the Act and 19 
CFR 351.225(f)(7)(i)(B), will notify the U.S. International Trade 
Commission (ITC) of this preliminary determination to include 
merchandise subject to this inquiry (i.e., glycine) within the Order. 
The ITC may request consultations concerning the Department's proposed 
inclusion of the subject merchandise. See section 781(e)(2) of the Act. 
Upon the request of the ITC, the administering authority shall consult 
with the ITC and any such consultation shall be completed within 15 
days after the date of the request. Id. If, after consultations, the 
ITC believes that a significant injury issue is presented by the 
proposed inclusion, it will have 60 days to provide written advice to 
the Department. See section 781(e)(3) of the Act.

Public Comment

    Interested parties are invited to comment on the preliminary 
results and

[[Page 21536]]

may submit case briefs and/or written comments within 20 days of the 
publication of this notice. See 19 CFR 351.225(f)(3). Interested 
parties may file rebuttal briefs and rebuttals to written comments, 
limited to issues raised in such briefs or comments, no later than 10 
days after the date on which the case briefs are due. Id. Interested 
parties may request a hearing within 20 days of the publication of this 
notice. Requests should contain the party's name, address, and 
telephone number, the number of participants, and a list of the issues 
to be discussed. At the hearing, each party may make an affirmative 
presentation only on issues raised in that party's case brief and may 
make rebuttal presentations only on arguments included in that party's 
rebuttal brief. Interested parties will be notified by the Department 
of the location and time of any hearing, if one is requested.

Final Determination

    The final determination with respect to this circumvention inquiry, 
including the results of the Department's analysis of any written 
comments, will be issued no later than July 30, 2012, unless extended. 
See section 781(f) of the Act and 19 CFR 351.302(b).
    This preliminary partial affirmative circumvention determination is 
published in accordance with section 781(b) of the Act and 19 CFR 
351.225.

    Dated: March 30, 2012.
Paul Piquado,
Assistant Secretary for Import Administration.
[FR Doc. 2012-8597 Filed 4-9-12; 8:45 am]
BILLING CODE 3510-DS-P

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