Small Diameter Graphite Electrodes From the People's Republic of China: Affirmative Final Determination of Circumvention of the Antidumping Duty Order, 47596-47602 [2012-19578]
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Federal Register / Vol. 77, No. 154 / Thursday, August 9, 2012 / Notices
As a result of the
determinations by the Department of
Commerce (the Department) and the
International Trade Commission (ITC)
that revocation of the antidumping duty
orders on stainless steel bar from Brazil,
India, Japan, and Spain would likely
lead to a continuation or recurrence of
dumping and material injury to an
industry in the United States, the
Department is publishing a notice of
continuation of the antidumping duty
orders.
DATES: Effective Date: August 9, 2012.
FOR FURTHER INFORMATION: Bryan
Hansen or Minoo Hatten, AD/CVD
Operations, Office 1, Import
Administration, International Trade
Administration, U.S. Department of
Commerce, 14th Street and Constitution
Avenue NW., Washington, DC 20230;
telephone: (202) 482–3683 or (202) 482–
1690, respectively.
SUPPLEMENTARY INFORMATION:
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SUMMARY:
Background
On December 1, 2011, the Department
initiated the third sunset reviews of the
antidumping duty orders 1 on stainless
steel bar from Brazil, India, Japan, and
Spain pursuant to section 751(c) of the
Tariff Act of 1930, as amended (the Act).
See Initiation of Five-Year (‘‘Sunset’’)
Review, 76 FR 74775 (December 1,
2011).
As a result of these sunset reviews,
the Department determined that
revocation of the antidumping duty
orders on stainless steel bar from Brazil,
India, Japan, and Spain would be likely
to lead to continuation or recurrence of
dumping and notified the ITC of the
magnitude of the margins likely to
prevail should the orders be revoked.
See Stainless Steel Bar from Brazil,
India, Japan, and Spain: Final Results of
the Expedited Third Sunset Reviews of
the Antidumping Duty Orders, 77 FR
16207 (March 20, 2012).
On August 1, 2012, pursuant to
section 752(a) of the Act, the ITC
published its determination that
revocation of the antidumping duty
orders on stainless steel bar from Brazil,
India, Japan, and Spain would likely
lead to continuation or recurrence of
material injury to an industry in the
United States within a reasonably
foreseeable time. See Stainless Steel Bar
From Brazil, India, Japan, and Spain;
Determination, 77 FR 45653 (August 1,
2012), and ITC Publication 4341 (July
2012) entitled Stainless Steel Bar from
1 Antidumping Duty Orders: Stainless Steel Bar
from Brazil, India and Japan, 60 FR 9661 (February
21, 1995) and Amended Final Determination and
Antidumping Duty Order: Stainless Steel Bar from
Spain, 60 FR 11656 (March 2, 1995).
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Brazil, India, Japan, and Spain
Investigation Nos. 731–TA–678, 679,
681, and 682 (Third Review).
Scope of the Orders
Imports covered by the orders are
shipments of stainless steel bar.
Stainless steel bar means articles of
stainless steel in straight lengths that
have been either hot-rolled, forged,
turned, cold-drawn, cold-rolled or
otherwise cold-finished, or ground,
having a uniform solid cross section
along their whole length in the shape of
circles, segments of circles, ovals,
rectangles (including squares), triangles,
hexagons, octagons, or other convex
polygons. Stainless steel bar includes
cold-finished stainless steel bars that are
turned or ground in straight lengths,
whether produced from hot-rolled bar or
from straightened and cut rod or wire,
and reinforcing bars that have
indentations, ribs, grooves, or other
deformations produced during the
rolling process.
Except as specified above, the term
does not include stainless steel semifinished products, cut length flat-rolled
products (i.e., cut length rolled products
which if less than 4.75 mm in thickness
have a width measuring at least 10 times
the thickness, or if 4.75 mm or more in
thickness having a width which exceeds
150 mm and measures at least twice the
thickness), wire (i.e., cold-formed
products in coils, of any uniform solid
cross section along their whole length,
which do not conform to the definition
of flat-rolled products), and angles,
shapes and sections.
The stainless steel bars subject to the
orders is currently classifiable under
subheadings 7222.10.00, 7222.11.00,
7222.19.00, 7222.20.00, and 7222.30.00
of the Harmonized Tariff Schedule of
the United States (HTSUS). Although
the HTSUS subheadings are provided
for convenience and customs purposes,
our written description of the scope of
the orders is dispositive.
Continuation of the Orders
As a result of the determinations by
the Department and the ITC that
revocation of these antidumping duty
orders would likely lead to continuation
or recurrence of dumping and material
injury to an industry in the United
States, pursuant to section 751(d)(2) of
the Act, the Department hereby orders
the continuation of the antidumping
duty orders on stainless steel bar from
Brazil, India, Japan, and Spain.
U.S. Customs and Border Protection
will continue to collect antidumping
duty cash deposits at the rates in effect
at the time of entry for all imports of
subject merchandise. The effective date
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of continuation of these orders will be
the date of publication in the Federal
Register of this notice of continuation.
Pursuant to section 751(c)(2) of the Act,
the Department intends to initiate the
next five-year reviews of these orders
not later than 30 days prior to the fifth
anniversary of the effective date of
continuation.
These five-year sunset reviews and
this notice are in accordance with
section 751(c) of the Act and published
pursuant to section 777(i)(1) of the Act.
Dated: August 2, 2012.
Paul Piquado,
Assistant Secretary for Import
Administration.
[FR Doc. 2012–19574 Filed 8–8–12; 8:45 am]
BILLING CODE 3510–DS–P
DEPARTMENT OF COMMERCE
International Trade Administration
[A–570–929]
Small Diameter Graphite Electrodes
From the People’s Republic of China:
Affirmative Final Determination of
Circumvention of the Antidumping
Duty Order
Import Administration,
International Trade Administration,
Department of Commerce.
SUMMARY: The Department of Commerce
(‘‘the Department’’) continues to
determine that certain small diameter
graphite electrodes (‘‘SDGE’’) are being
exported from the United Kingdom
(‘‘U.K.’’) to the United States by UK
Carbon and Graphite Co., Ltd. (‘‘UKCG’’)
in circumvention of the antidumping
duty order on SDGE from the People’s
Republic of China (‘‘PRC’’),1 as provided
in section 781(b) of the Tariff Act of
1930, as amended (‘‘the Act’’).
DATES: Effective Date: August 9, 2012.
FOR FURTHER INFORMATION CONTACT:
Brendan Quinn, Office 8, Import
Administration, International Trade
Administration, U.S. Department of
Commerce, 14th Street and Constitution
Avenue NW., Washington, DC 20230;
telephone: (202) 482–5848.
SUPPLEMENTARY INFORMATION:
AGENCY:
Background
On June 6, 2012, the Department
published in the Federal Register the
affirmative preliminary determination
that certain SDGE finished by UKCG
from PRC-produced artificial graphite
1 See Antidumping Duty Order: Small Diameter
Graphite Electrodes from the People’s Republic of
China, 74 FR 8775 (February 26, 2009) (‘‘SDGE
Order’’).
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Federal Register / Vol. 77, No. 154 / Thursday, August 9, 2012 / Notices
rod/unfinished SDGE component 2
inputs are exported to the United States
in circumvention of the antidumping
duty order on SDGE from the PRC, as
provided in section 781(b) of the Act.3
Pursuant to section 781(e) of the Act, on
June 8, 2012, the Department notified
the U.S. International Trade
Commission (‘‘ITC’’) of its affirmative
preliminary determination of
circumvention, in accordance with
section 781(e) of the Act, and informed
the ITC of its ability to request
consultation with the Department
regarding the possible inclusion of the
products in question within the SDGE
Order pursuant to section 781(e)(2) of
the Act. On July 6, 2012, the ITC
informed the Department that
consultations pursuant to section
781(e)(2) of the Act were not necessary.
On June 20, 2012, UKCG, SGL Carbon
LLC and Superior Graphite Co.
(‘‘Petitioners’’), and the Government of
the United Kingdom filed case briefs.
On June 27, 2012, Petitioners and UKCG
filed rebuttal briefs. On July 10, 2012,
the Department held a public hearing,
based on a timely filed request by
UKCG.4
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Scope of the Antidumping Duty Order
The merchandise covered by this
order includes all small diameter
graphite electrodes of any length,
whether or not finished, of a kind used
in furnaces, with a nominal or actual
diameter of 400 millimeters (16 inches)
or less, and whether or not attached to
a graphite pin joining system or any
other type of joining system or
hardware. The merchandise covered by
this order also includes graphite pin
joining systems for small diameter
2 According to Petitioners, the unfinished
merchandise in question is defined in UKCG’s
submissions as, e.g., ‘‘graphite electrodes,’’ ‘‘rods,’’
‘‘graphite billets,’’ graphite shapes,’’ ‘‘synthetic
graphite electrode rod,’’ and ‘‘re-machined graphite
electrode.’’ Petitioners characterize these inputs as
‘‘unfinished SDGE,’’ whereas UKCG refers to them
as ‘‘blanks’’ or ‘‘artificial graphite.’’ For customs
purposes, these materials are, generally, classified
under Harmonized Tariff Schedule (‘‘HTS’’) subheading 3801.10.00, defined as ‘‘Artificial Graphite;
Colloidal or Semi-Colloidal Graphite; Preparations
Based on Graphite or Other Carbon in the Form of
Pastes, Blocks, Plates or Other Semi-Finished
Goods.’’ For ease of reference, these materials are
referred to as ‘‘unfinished SDGE components’’ or
‘‘artificial graphite rods’’ throughout this notice.
3 See Small Diameter Graphite Electrodes from
the People’s Republic of China: Affirmative
Preliminary Determination of Circumvention of the
Antidumping Duty Order and Extension of Final
Determination, 77 FR 33405 (June 6, 2012)
(‘‘Preliminary Determination’’).
4 See transcript entitled, ‘‘Public Hearing; In the
Matter of: the Anti-circumvention Inquiry of the
Antidumping Duty Order on Small Diameter
Graphite Electrodes from the People’s Republic of
China (A–570–929) (UKCG),’’ dated July 10, 2012
(‘‘Hearing Transcript’’).
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graphite electrodes, of any length,
whether or not finished, of a kind used
in furnaces, and whether or not the
graphite pin joining system is attached
to, sold with, or sold separately from,
the small diameter graphite electrode.
Small diameter graphite electrodes and
graphite pin joining systems for small
diameter graphite electrodes are most
commonly used in primary melting,
ladle metallurgy, and specialty furnace
applications in industries including
foundries, smelters, and steel refining
operations. Small diameter graphite
electrodes and graphite pin joining
systems for small diameter graphite
electrodes that are subject to this order
are currently classified under the
Harmonized Tariff Schedule of the
United States (‘‘HTSUS’’) subheading
8545.11.0000 5 and 3801.10.6 The
HTSUS number is provided for
convenience and customs purposes, but
the written description of the scope is
dispositive.
Scope of the Anticircumvention Inquiry
The products covered by this inquiry
are small diameter graphite electrodes
produced by UKCG from PRCmanufactured artificial/synthetic
graphite forms, of a size and shape (e.g.,
blanks, rods, cylinders, billets, blocks,
etc.) which requires additional
machining processes (i.e., tooling and
shaping) to become a finished SDGE (or
graphite pin joining system).7 The SDGE
products in question are finished
graphite electrodes manufactured by
UKCG from PRC-originated artificial
graphite rod/unfinished SDGE
components. While UKCG argues that
the SDGE it produces and exports to the
United States are of U.K. origin under
U.K. law, the focus and intent of this
inquiry is to determine whether
artificial/synthetic graphite forms (1)
5 The scope described in the SDGE Order refers
to the HTSUS subheading 8545.11.0000. We note
that, starting in 2010, imports of SDGEs are
classified in the HTSUS under subheading
8545.11.0010 and imports of large diameter graphite
electrodes are classified under subheading
8545.11.0020.
6 HTSUS subheading 3801.10 is added to the
scope of the order based on a determination in the
instant anticircumvention proceeding. See
Summary of Analysis of Statutory Provisions
section, below, and the accompanying
Memorandum from Christian Marsh, Deputy
Assistant Secretary for Antidumping and
Countervailing Duty Operations, to Paul Piquado,
Assistant Secretary for Import Administration, Re:
‘‘Anticircumvention Inquiry Regarding the
Antidumping Duty Order on Small Diameter
Graphite Electrodes from the People’s Republic of
China: Issues and Decision Memorandum for the
Final Determination of the Anticircumvention
Inquiry’’ (‘‘Decision Memorandum’’), dated July 31,
2012 at Comment 6.
7 As noted above, these materials are referred to
as ‘‘unfinished SDGE components’’ or ‘‘artificial
graphite rods’’ throughout this notice.
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Manufactured in the PRC; (2) exported
to the United Kingdom for processing/
machining (finishing); and (3) reexported to the United States as U.K.
origin merchandise constitute
circumvention of the SDGE Order under
781(b) of the Act.
Analysis of Comments Received
All issues raised in the postpreliminary comments by parties in this
proceeding are addressed in the
Decision Memorandum and hereby
adopted by this notice. A list of the
issues which the parties raised and to
which the Department responds in the
Decision Memorandum is attached to
this notice as Appendix I. The Decision
Memorandum is a public document and
is on file electronically via Import
Administration’s Antidumping and
Countervailing Duty Centralized
Electronic Service System (‘‘IA
ACCESS’’). Access to IA ACCESS is
available in the Central Records Unit,
room 7046 of the main Department of
Commerce building. In addition, a
complete version of the Decision
Memorandum can be accessed directly
on the Internet at https://www.trade.gov/
ia/. The signed Decision Memorandum
and the electronic versions of the
Decision Memorandum are identical in
content.
Affirmative Final Determination of
Circumvention
For the final determination, we
continue to rely on the statutory criteria
that we considered in making our
Preliminary Determination.8 Based on
our review of the record evidence and
our analysis of the comments received,
the Department continues to find that
certain SDGE finished by UKCG from
PRC-produced artificial graphite rod/
unfinished SDGE component inputs are
exported to the United States in
circumvention of the antidumping duty
order on SDGE from the PRC. For a
complete discussion of the Department’s
analysis, see the accompanying Decision
Memorandum.
Summary of Analysis of Statutory
Provisions
(A) Whether Merchandise Imported Into
The United States Is of the Same Class
Or Kind As Merchandise That Is Subject
To The SDGE Order
As noted in the Preliminary
Determination, the finished products, as
sold by UKCG to the United States, are
identical to those covered by the SDGE
Order.9 No interested party to this
8 See
9 See
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Preliminary Determination, 77 FR at 33409.
Preliminary Determination, 77 FR at 33410.
09AUN1
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Federal Register / Vol. 77, No. 154 / Thursday, August 9, 2012 / Notices
proceeding has contested this fact
during the course of the inquiry. As
such, we continue to find that the
finished SDGE products exported to the
United States by UKCG are of the same
class or kind as other merchandise that
is subject to the SDGE Order.
(B) Whether, Before Importation Into
The United States, Such Imported
Merchandise Is Completed or
Assembled In A Third Country From
Merchandise Which Is Subject To The
Order or Produced In The Foreign
Country That Is Subject To The Order
Pursuant to section 781(b)(1)(B) of the
Act, and consistent with our findings in
the Preliminary Determination, we
continue to find that the totality of the
sourcing/procurement information and
corresponding sales documentation on
record clearly demonstrate that the
inputs in question are produced in the
foreign country that is subject to the
SDGE Order.10
Additionally, as discussed at length in
the accompanying Decision
Memorandum at Comment 1, the
Department has analyzed the arguments
with respect to the in-scope nature of
UKCG’s artificial graphite rod/
unfinished SDGE component inputs and
continues to find that the ‘‘rod’’ inputs
constitute unfinished SDGE explicitly
included within the scope of the SDGE
Order.11 As a result, the Department
finds that certain subject merchandise
may be properly categorized under
HTSUS subheading 3801.10. Because
HTSUS numbers are included in the
scope language for convenience and
customs purposes, we are adding this
HTS subheading to the scope language
of the SDGE Order to aid U.S. Customs
and Border Protection (‘‘CBP’’) by
clarifying that products categorized
under the HTSUS 3801.10 category, as
imported, which otherwise fit the
narrative description of unfinished
products covered by the SDGE Order,
should be considered merchandise
subject to the order.12
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(C) Whether the Process of Assembly or
Completion in the Third Country is
Minor or Insignificant
Pursuant to section 781(b)(1)(C) of the
Act, section 781(b)(2) of the Act
provides the criteria for determining
10 See id., 77 FR at 33410–11. See also
Memorandum from the Department entitled, ‘‘AntiCircumvention Inquiry Regarding the Antidumping
Duty Order on Small Diameter Graphite Electrodes
from the People’s Republic of China: Preliminary
Determination Analysis Memorandum of U.K.
Carbon and Graphite Co., Ltd.,’’ dated May 30, 2012
(‘‘Preliminary Analysis Memorandum’’) at 5–8 and
Attachment II.
11 See Decision Memorandum at Comment 1.
12 See Decision Memorandum at Comment 6.
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whether the process of assembly or
completion is minor or insignificant.
These criteria are:
781(b)(2)(A): The level of investment
in the third country;
781(b)(2)(B): The level of research and
development (‘‘R&D’’) in the third
country;
781(b)(2)(C): The nature of the
production process in the third country;
781(b)(2)(D): The extent of the
production facilities in the third
country; and
781(b)(2)(E): Whether the value of the
processing performed in the third
country represents a small proportion of
the value of the merchandise imported
into the United States.
The SAA explains that no single
factor listed in section 781(b)(2) of the
Act will be controlling.13 Accordingly, it
is the Department’s practice to evaluate
each of the factors as they exist in the
United States or foreign country
depending on the particular
anticircumvention inquiry.14 In this
anticircumvention inquiry, based on the
record, we have considered and
evaluated each statutory criterion and
all factors in determining whether the
process of converting the PRC-sourced
artificial graphite rod/unfinished SDGE
component inputs in the U.K. was
minor or insignificant, in accordance
with section 781(b)(2) of the Act,
consistent with our analysis in prior
anticircumvention inquiries.15
13 See Statement of Administrative Action
accompanying the Uruguay Round Agreements Act,
H.R. Doc. 103–316, vol. 1 (1994) (‘‘SAA’’) at 893.
14 See Certain Tissue Paper Products from the
People’s Republic of China: Affirmative Final
Determination of Circumvention of the
Antidumping Duty Order, 73 FR 57591 (October 3,
2008) at 57592.
15 See, e.g., Anticircumvention Inquiry of the
Antidumping and Countervailing Duty Orders on
Certain Pasta From Italy: Affirmative Preliminary
Determinations of Circumvention of Antidumping
and Countervailing Duty Orders, 68 FR 46571
(August 6, 2003) (‘‘Pasta Circumvention Prelim’’),
unchanged in Anticircumvention Inquiry of the
Antidumping and Countervailing Duty Orders on
Certain Pasta from Italy: Affirmative Final
Determinations of Circumvention of Antidumping
and Countervailing Duty Orders, 68 FR 54888
(September 19, 2003) (‘‘Pasta Circumvention
Final’’); and Hot-Rolled Lead and Bismuth Carbon
Steel Products from Germany and the United
Kingdom; Negative Final Determination of
Circumvention of Antidumping and Countervailing
Duty Orders, 64 FR 40336, 40347–48 (July 26, 1999)
(explaining that Congress has directed the
Department to focus more on the nature of the
production process and less on the difference in
value between the subject merchandise and the
imported parts or components and that any attempt
to establish a numerical standard would be contrary
to the intent of Congress).
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Analysis of 781(b)(2)(A),(B),(C), & (D):
The Levels of Investment, R&D, The
Nature of Production Processes, and
Extent of Production Facilities in the
United Kingdom
Pursuant to sections 781(b)(2)(A)–(D)
of the Act, the Department continues to
find, consistent with our Preliminary
Determination, that the information on
record with respect to UKCG’s
investment, R&D, production processes
and production facilities continues to
support the conclusion that the process
of assembly or completion occurring in
the United Kingdom is minor or
insignificant in comparison to the
totality of the production of subject
merchandise.
Analysis of 781(b)(2)(E): Whether the
Value of the Processing Performed in
the United Kingdom Represents a Small
Proportion of the Value of the
Merchandise Imported Into the United
States
For the Preliminary Determination,
the Department utilized a quantitative
analysis to determine the proportion of
UKCG’s further processing value by
comparing UKCG’s further processing
costs to the actual value of the
merchandise exported to the United
States during the period of review (i.e.,
U.S. price) and preliminarily found that
the UKCG’s value-added comprised
only a small proportion of the total
export value. The Department
concluded that this quantitative finding
lent additional support to the qualitative
finding and that, pursuant to section
781(b)(2)(E) of the Act, the value of
UKCG’s processing represents a small
proportion of the value of the
merchandise sold in the United States.16
For this final determination, the
Department agrees with UKCG that the
methodology we used for the analysis
under section 781(b)(2)(E) of the Act for
Preliminary Determination warrants
modification, but only to the extent that
our measurement of the value-added in
the United Kingdom did not properly
account for profit (as well as selling,
general, and administrative (‘‘SG&A’’)
expenses and interest expenses) in the
numerator of the calculation. We find
that the inclusion of an amount for
SG&A, interest, and profit would help to
better reflect the value-added to the
finished product in the United
Kingdom. However, we do not agree
with UKCG’s suggested methodology.
Instead, we have amended the
Preliminary Determination calculation
so that UKCG’s profit margin and SG&A
16 See Preliminary Determination 77 FR at 33413–
15. See also Preliminary Analysis Memorandum at
16–18 and Attachment VI.
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and interest ratios are added to the
reported further manufacturing cost.17
While the revised value-added figure
increases the value-added figure used in
the Preliminary Determination, the
Department finds that this figure still
represents a small proportion of the
overall sales value as exported to the
United States. As a result, we continue
to find that this criterion supports
finding that the process of completion
in the UK is minor.18
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Overall Analysis of Section 781(b)(1)(C)
of the Act (i.e., Sections 781(b)(2)(A)–(E)
of the Act)
As discussed above and in the
Preliminary Determination, it is clear
from the legislative history that an
analysis of possible circumvention
should not be based solely on a
quantitative analysis, but rather should
examine the value added in qualitative
terms as well.19 The SAA also explains
that no single factor listed in section
781(b)(2) of the Act will be controlling.
Accordingly, it is the Department’s
practice to evaluate each of the factors
as they exist in the United States or
foreign country depending on the
particular circumvention scenario.
Therefore, the importance of any one of
the factors listed under section 781(b)(2)
of the Act can vary from case to case
depending on the particular
circumstances unique to each
circumvention inquiry.
In this anticircumvention inquiry, we
based our analysis on both qualitative
and quantitative factors in determining
whether the process of finishing the
SDGE in the United Kingdom was minor
or insignificant, in accordance with the
criteria of section 781(b)(2) of the Act.
This approach is consistent with our
analysis in prior circumvention
inquiries.20 Based on the above analysis,
we determine that the process of
finishing performed by UKCG in the
United Kingdom is minor or
insignificant primarily because we
determine that the nature of the
processing is minor when compared to
the production of SDGE from raw
materials and the value of the
17 See Memorandum from the Department
entitled, ‘‘Anticircumvention Inquiry Regarding the
Antidumping Duty Order on Small Diameter
Graphite Electrodes from the People’s Republic of
China: Final Determination Analysis Memorandum
of U.K. Carbon and Graphite Co., Ltd.,’’ dated July
31, 2012 (‘‘Final Analysis Memorandum’’).
18 Information about the value-added figure is
business proprietary. See Final Analysis
Memorandum for exact values. See also ‘‘Overall
Analysis’’ section, below, and Decision
Memorandum at Comment 3.
19 See Preliminary Determination 77 FR at 33413,
citing to SAA at 893 (1994).
20 See, e.g., Pasta Circumvention Prelim 68 FR at
46574 (unchanged in Pasta Circumvention Final).
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processing performed by UKCG in the
United Kingdom represents a small
proportion of the value of the
merchandise imported into the United
States. This qualitative determination is
based on our analysis with respect to
sections 781(b)(2)(A),(B),(C), and (D) of
the Act (as laid out in the Preliminary
Determination and summarized above),
as well as our finding that the input
material itself constitutes merchandise
subject to the SDGE Order. As stated in
the Preliminary Determination, ‘‘while
the Department believes that this
qualitative analysis is sufficient to
determine whether the value of
processing in the third country
constitutes a small portion of the value
of the merchandise exported to the
United States, the Department has
obtained the information necessary to
{quantitatively} evaluate the proportion
of UKCG’s processing.’’ 21 Thus, the
quantitative analysis in the Preliminary
Determination was issued in support of
the qualitative finding based on the
availability of the relevant data, but the
Department plainly noted that the
qualitative finding of relatively
insignificant value added was, by itself,
sufficient to fulfill the analysis required
pursuant to section 781(b)(2)(E) of the
Act. Although the Department has
amended the methodology used to
conduct this quantitative analysis for
the instant final determination, as noted
above, we find that the resultant values
continue to indicate that the value
added in the United Kingdom
represents a small proportion of the
overall sales value as exported to the
United States. Further, we continue to
find that the qualitative determination is
itself sufficient and determinative to
address the value-added criteria under
the statute and that the corresponding
quantitative analysis supports the
Department’s qualitative determination
on this issue.22
(D) Whether the Value of the
Merchandise Produced in the Foreign
Country to Which the Order Applies Is
a Significant Portion of the Total Value
of the Merchandise Exported to the
United States
Because key elements of the
Department’s analysis under section
781(b)(1)(D) of the Act necessitate
obtaining a value for an NME input, the
Department determined that an analysis
of UKCG’s input costs falls under the
purview of the Department’s NME
methodology and, therefore, utilized a
surrogate value (‘‘SV’’) to value UKCG’s
21 See
Preliminary Determination at 33413.
Decision Memorandum at Comment 3. See
also Final Analysis Memorandum.
22 See
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47599
PRC-sourced artificial graphite rod/
unfinished SDGE component inputs,
consistent with both section 773(c)(1) of
the Act as well as the Department’s past
practice.23 As a result, the Department
determined that the appropriate
calculation required by section
781(b)(1)(D) of the Act expresses the SV
for the artificial graphite rod/unfinished
SDGE component inputs in question as
a percentage of UKCG’s reported total
sales value and found that the PRCproduced merchandise represents a
significant percentage of the sales value
of UKCG’s U.S. exports of finished
merchandise.24 A full discussion of the
propriety of utilizing the Department’s
SV methodology with respect to the
valuation of UKCG’s inputs is provided
in Comment 2 of the accompanying
Decision Memorandum.
Other Factors To Consider
In making a determination whether to
include merchandise assembled or
completed in a foreign country within
an order, section 781(b)(3) of the Act
instructs the Department to take into
account such factors as: (A) The pattern
of trade, including sourcing patterns; (B)
whether affiliation exists between the
manufacturer or exporter of the
merchandise in the country subject to
the order and the person who uses the
merchandise to assemble or complete in
the third country the merchandise that
is exported to the United States; and (C)
whether imports into the third country
of the merchandise described in section
781(b)(1)(B) of the Act have increased
since the initiation of the original
investigation. In the Preliminary
Determination the Department found
that:
(A) Record information demonstrated
that PRC exports of SDGE to the United
States have decreased significantly
whereas U.K. exports of SDGE to the
United States, UKCG’s exports of SDGE
to the United States, and UKCG’s
sourcing of relevant inputs from the
PRC, have increased since the initiation
of the less-than-fair-value (‘‘LTFV’’)
investigation. These patterns of trade
23 See Preliminary Determination 77 FR at 33407–
09, citing to, e.g., Steel Wire Garment Hangers from
the People’s Republic of China: Affirmative
Preliminary Determination of Circumvention of the
Antidumping Duty Order and Extension of Final
Determination, 76 FR 27007 (May 10, 2011)
(‘‘Hangers Anticircumvention Prelim’’) at 27008,
unchanged in Steel Wire Garment Hangers From the
People’s Republic of China: Affirmative Final
Determination of Circumvention of the
Antidumping Duty Order, 76 FR 66895 (October 28,
2011) (‘‘Hangers Anticircumvention Final’’).
24 See Preliminary Determination 77 FR at 33415.
See also Preliminary Analysis Memo for a
discussion of the exact values used, as this
information is business proprietary.
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tkelley on DSK3SPTVN1PROD with NOTICES
support a finding that circumvention
has occurred.25
(B) UKCG is not affiliated with any
PRC-producers of artificial graphite rod/
unfinished SDGE component inputs.26
(C) In addition to the aforementioned
increase in UKCG’s sourcing of relevant
inputs from the PRC, PRC exports of
artificial graphite to the United
Kingdom have also increased
significantly since the initiation of the
LTFV investigation.27
No party to this proceeding has
challenged any of the aforementioned
findings since the issuance of the
Preliminary Determination. The
Department continues to find that
UKCG is not affiliated with any of its
PRC-producers of artificial graphite rod/
unfinished SDGE component inputs.
However, the totality of the pattern of
trade data—which shows an increase
with respect to UKCG’s importation of
artificial graphite rod/unfinished SDGE
component inputs from the PRC and
exports of finished SDGE to the United
States from the United Kingdom, an
increase of artificial graphite imports
into the United Kingdom on the whole,
and a corresponding decrease in
finished SDGE exported to the United
States from the PRC—supports an
affirmative determination of
circumvention.
Summary of Statutory Analysis
We find that UKCG has circumvented
the SDGE Order in accordance with
sections 781(b)(1) and (2) of the Act.
Pursuant to sections 781(b)(1)(A) and
(B) of the Act, we find that the
merchandise sold in the United States is
identical to merchandise that is subject
to the SDGE Order and was completed
in the United Kingdom from
merchandise which is: (a) Covered by
the explicit language of the scope of the
SDGE Order, and (b) produced in the
PRC, the country to which the SDGE
Order applies. Additionally, pursuant to
section 781(b)(1)(C) of the Act, we find
the process of completion in the United
Kingdom to be minor and insignificant
based on each facet of the analysis
under section 781(b)(2) of the Act.
Furthermore, in accordance with section
781(b)(1)(D) of the Act, we find that the
value of the merchandise produced in
the PRC is a significant portion of the
total value of the merchandise exported
to the United States. Finally, upon
taking into consideration section
25 See Preliminary Determination 77 FR at 33416–
17. See also Preliminary Analysis Memorandum at
20–22 and Attachments VII–XII
26 See Preliminary Determination 77 FR at 33417.
27 See Preliminary Determination 77 FR at 33417.
See also Preliminary Analysis Memorandum at 23
and Attachments VII–XII.
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Jkt 226001
781(b)(3) of the Act, our analysis of the
pattern of trade, including sourcing, and
an affirmative finding of an increase in
imports of artificial graphite/unfinished
SDGE into the United Kingdom from the
PRC since the initiation of the initial
LTFV investigation, we conclude that
action is appropriate to prevent
circumvention of the SDGE Order
pursuant to 781(b)(1)(E) of the Act.
Consequently, our statutory analysis
leads us to find that, during the period
of time examined, there was
circumvention of the SDGE Order as a
result of UKCG’s processing/machining
of the PRC-origin artificial graphite/
unfinished SDGE components to
finished SDGE in the United Kingdom,
as discussed above.
Continuation of Suspension of
Liquidation
Based on the record evidence, the
Department has determined that UKCG
is able to provide documentation to its
U.S. importers that identifies the input
supplier for each SDGE UKCG sold in
the United States.28 As a result, the
Department is requiring UKCG and its
importers to prepare and maintain
certifications regarding the supplier.29
Additionally, for all merchandise
exported by UKCG where the supplier
was a PRC-entity, the Department will
direct CBP to require cash deposits at
the rate established for the PRC supplier
if that supplier has its own rate or,
alternatively, at the PRC-wide rate of
159.64 percent if the PRC supplier does
not have its own rate or if the importer
cannot identify the supplier.
The Department continues to find that
its preliminary cash deposit instructions
are fully consistent with the
Department’s obligations under section
781(b) of the Act.30 The Department
concludes, pursuant to Section 781(b) of
the Act, that SDGE finished by UKCG
from PRC-produced inputs covered
under the narrative description of the
scope of the SDGE Order, are being
exported to the United States in
circumvention of the SDGE Order, and
that the appropriate means of
addressing that circumvention is to
collect cash deposits on all merchandise
meeting that description. As such, we
find it appropriate and consistent with
past practice to instruct CBP to suspend
liquidation and collect cash deposits on
all unliquidated entries of SDGE
produced by UKCG from PRCmanufactured unfinished SDGE inputs
28 See
Preliminary Determination 77 FR at 33417–
18.
29 See id. 77 FR at 33417–18 and the certifications
provided at 77 FR 33419–33420. See also
Appendices II, III, IV, and V to this notice.
30 See Decision Memorandum at Comment 5.
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Fmt 4703
Sfmt 4703
at the rate applicable to the relevant
PRC-manufacturer, including the PRCwide entity if applicable.31 In requiring
that CBP collect cash deposits on
UKCG’s exports of SDGE found to be in
circumvention of the antidumping order
as appropriate, the Department is
making no final determination of
UKCG’s dumping duty liability at this
time.32
Accordingly, the Department will
continue to direct CBP to suspend
liquidation and to require a cash deposit
of estimated duties at the applicable rate
on unliquidated entries of SDGE
produced and/or exported by UKCG that
were entered, or withdrawn from
warehouse, for consumption on or after
March 18, 2011, the date of initiation of
the anticircumvention inquiry. Where
the importer can demonstrate that the
primary input material was produced by
a company that has a separate rate, CBP
will collect that company’s cash deposit
rate. Where the importer can
demonstrate that the SDGE at issue was
produced from reclaimed/reconditioned
electrode inputs 33 or artificial graphite
rod/unfinished SDGE component inputs
sourced from a third country producer,
CBP should not suspend those entries or
collect AD duties on those entries. For
all other entries of merchandise
exported by UKCG, CBP will require a
cash deposit equal to the PRC-wide rate
of 159.64 percent.
For all entries of finished SDGE
produced from artificial graphite rod/
unfinished SDGE component inputs
subject to the scope of this
anticircumvention proceeding which
UKCG believes should be assessed at a
rate other than the PRC-wide rate,
UKCG is required to furnish its
customers/importers with a certification
identifying, as appropriate, the
manufacturer/exporter of the primary
input into the SDGE it processes in the
U.K. prior to exportation to the United
States. For all entries of SDGE produced
from inputs not subject to the scope of
31 See Certain Tissue Paper Products From the
People’s Republic of China: Affirmative Final
Determination of Circumvention of the
Antidumping Duty Order, 76 FR 47551 (August 5,
2011), and accompanying Issues and Decision
Memorandum at Comments 4 and 5. For a full
discussion of this issue, see the accompanying
Decision Memorandum at Comment 5.
32 See Decision Memorandum at Comment 5.
33 As noted in the Preliminary Determination 77
FR at 33418, UKCG purchases broken/cracked or
otherwise unusable electrodes from sources in
various non-PRC countries, refurbishes them, and
re-sells them for use as finished electrodes. The
broken, cracked, or otherwise unusable electrode
inputs sourced by UKCG are ‘‘reclaimed’’
electrodes, whereas the resulting finished product
is a ‘‘remanufactured,’’ ‘‘remachined,’’ or
‘‘reconditioned’’ electrode. For ease of reference,
these products are referred to as ‘‘reclaimed/
reconditioned’’ electrodes.
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this anticircumvention proceeding (i.e.,
SDGE produced from reclaimed/
reconditioned inputs or inputs
produced in a third country), UKCG is
required to furnish its customers/
importers with a certification
identifying the supplier or producer (as
appropriate) of the primary input into
the SDGE it processes in the U.K. prior
to exportation to the United States.34
Importers are also required to sign and
maintain certifications for these types of
entries. The certification formats are
provided in Appendices II, III, IV, and
V to this notice.35 The importer will be
required to retain each certificate for
individual entries for the later of: (1) A
period of five years from the date of
entry or (2) a period of three years after
the conclusion of any antidumping duty
litigation regarding such entries. It is the
importer’s responsibility to accurately
declare to CBP the appropriate
antidumping duty rate (or that no
antidumping duty applies) for each
entry.
Accordingly, the Department will
instruct CBP to: (i) Require cash
deposits at the rate established for the
PRC supplier if that supplier has its own
rate; (ii) require cash deposits at the
PRC-wide rate of 159.64 percent if the
PRC supplier does not have its own rate
or if the importer cannot identify the
supplier. If the importer is able to
demonstrate through the abovereferenced certification process that the
source of the artificial graphite rod/
unfinished SDGE component inputs
used in the production of finished SDGE
imported from UKCG is not of PRCorigin or the finished SDGE is produced
from reclaimed/reconditioned inputs,
then no suspension of liquidation or
cash deposit is required.36 These
Decision Memorandum at Comment 4.
certification language has been slightly
modified from that proposed in the Preliminary
Determination to reflect the results of this final
determination. See Decision Memorandum at
Comment 4.
36 The exporter-supplied certification will serve
as the initial demonstration supporting the
importer’s claim regarding which antidumping duty
rate (or that no antidumping duty rate) is
applicable. However, should CPB determine that
further demonstration is warranted, it may seek
additional documentation from the importer
pursuant to 19 CFR 163.6(a) and other applicable
regulations and statutory authority. Under 19 CFR
163.6(a), CBP may require the production of entry
records from any party required to maintain such
records as defined in 19 CFR 163.2(a). 19 CFR
163.1(a)(2)(vii) defines such records to include any
information made or normally kept in the ordinary
course of business that pertains to an activity
‘‘required to be undertaken pursuant to the laws or
regulations administered by Customs,’’ which
would include the proper assessment of
antidumping duties. As such, for the purpose of
demonstrating that a rate other than the PRC-wide
rate should be assessed to entries subject to this
anticircumvention proceeding, UKCG should be
instructions will apply to entries of
SDGE produced and/or exported by
UKCG that were entered, or withdrawn
from warehouse, for consumption on or
after March 18, 2011, the date of
initiation of the anticircumvention
inquiry. For unliquidated entries made
prior to March 18, 2011, UKCG will not
be required to provide the above-noted
documentation to the importer. The
importer will be required to provide the
documentation to CBP within the time
frame established by CBP. Consistent
with past practice the Department has
determined that a third-country
antidumping duties case number for the
United Kingdom is necessary as part of
this determination for importers to
identify merchandise as subject
merchandise, and to ensure that CBP
can collect antidumping duties on
subject SDGEs that are processed in and
exported from the United Kingdom.37
Notification to Interested Parties
This notice serves as the only
reminder to parties subject to the
administrative protective order (‘‘APO’’)
of their responsibility concerning the
return or destruction of proprietary
information disclosed under APO in
accordance with 19 CFR 351.305.
Timely written notification of the return
or destruction of APO materials or
conversion to judicial protective order is
hereby requested. Failure to comply
with the regulations and terms of an
APO is a violation which is subject to
sanction.
This final affirmative circumvention
determination is published in
accordance with section 781(b) of the
Act and 19 CFR 351.225(h).
34 See
tkelley on DSK3SPTVN1PROD with NOTICES
35 The
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Jkt 226001
prepared to provide to its importers, where
applicable, documentation to substantiate the
supplier claim made on the UKCG certification to
the importer. Thus, if CBP should determine further
demonstration is necessary and request supporting
documentation from the importer, UKCG will be
responsible for providing to the importer additional
documentation pursuant to 19 CFR 163.6(a) to
substantiate the certification.
37 See, e.g., Laminated Woven Sacks From the
People’s Republic of China: Final Results of First
Antidumping Duty Administrative Review, 76 FR
14906, 14907 (March 18, 2011) (noting that ‘‘the
Department has coordinated with CBP to resolve
issues arising from differences between the
Department’s and CBP’s respective country-oforigin classifications and from technical restrictions
in CBP’s electronic filing systems. As a result, the
Department has added several case numbers to the
Case Reference file within the Automated
Commercial Environment to ensure that requisite
entries are and can be properly claimed as scope
merchandise.’’).
PO 00000
Frm 00013
Fmt 4703
Sfmt 4703
47601
Dated: July 31, 2012.
Paul Piquado,
Assistant Secretary for Import
Administration.
Appendix I
Discussion of the Issues
Comment 1: Whether ‘‘Rods’’ Are Covered
Under the Scope of the Order
Comment 2: Use of Ukrainian Surrogate
Values To Value Artificial Graphite Rod/
Unfinished SDGE Component Inputs
Comment 3: Value-Added Methodology
Comment 4: Whether To Include
Reconditioned Products in the Scope of the
Anticircumvention Inquiry
Comment 5: Cash Deposit and Assessment of
AD Duties
Comment 6: Inclusion of HTSUS Subheading
3801.10 in the Scope of the Order
Comment 7: Clarification That Graphitization
Confers Country of Origin
Appendix II
Certification of UK Carbon and Graphite Co.,
Ltd. for SDGE Exports Produced From
Reclaimed/Reconditioned Electrode Inputs
or From Non-Chinese-Origin Artificial
Graphite Rod/Unfinished SDGE Component
Inputs
I hereby certify that I am an official of UK
Carbon and Graphite Co., Ltd. (‘‘UKCG’’) and
that that the small diameter graphite
electrode products processed by UKCG in the
United Kingdom into the small diameter
graphite electrodes included within this
shipment pursuant to Invoice numbers: 38
• Invoice
• Invoice * * *
were produced from reclaimed/reconditioned
electrode inputs or from non Chinese-origin
artificial graphite rod/unfinished SDGE
component inputs.
By signing this certificate, UKCG also
hereby agrees to:
• Maintain sufficient documentation
supporting the above statement for all
reclaimed/reconditioned electrode inputs or
non Chinese-origin artificial graphite rod/
unfinished SDGE component inputs used to
produce the exported small diameter graphite
electrode products.
• Provide such documentation to the
importer of the merchandise subject to this
certification if required by U.S. Customs and
Border Protection (‘‘CBP’’). UKCG is required
to maintain all such documentation for
individual entries until the later of (1) a
period of five years from the date of entry or
(2) a period of three years after the
conclusion of any litigation in United States
courts regarding such entries.
• Submit to verification by the U.S.
Government of the underlying
documentation supporting the above
statement pursuant to the administration of
38 If an individual invoice is representative of
merchandise produced from both Chinese-origin
artificial graphite rod inputs, as well as non-subject
inputs, UKCG shall identify the non-subject
merchandise in this certification, and will provide
a companion certification identifying the subject
merchandise based on the certification provided
below in Appendix IV.
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an antidumping duty proceeding covering
small diameter graphite electrodes from the
People’s Republic of China.
• Provide this certification to the U.S.
customer/importer at the time of shipment.
UKCG acknowledges that failure to submit
to verification of the documentation by the
U.S. Government may result in immediate
revocation of certification rights and under
such circumstances the importer of the
merchandise will be required to post a cash
deposit equal to the PRC-wide entity rate on
all entries of small diameter graphite
electrode products sourced from UKCG. In
addition, if the Department of Commerce
(‘‘Commerce’’) identifies any
misrepresentation or inconsistencies
regarding the certifications, UKCG recognizes
that the matter may be reported to CBP by
Commerce for possible enforcement action.
Signature: llllllllllllllll
Printed Name: llllllllllllll
Title: llllllllllllllllll
Date: llllllllllllllllll
tkelley on DSK3SPTVN1PROD with NOTICES
Appendix III
Certification of U.S. Importer for SDGE
Exports Produced From Reclaimed/
Reconditioned Electrode Inputs or From
Non-Chinese-Origin Artificial Graphite Rod/
Unfinished SDGE Component Inputs
I hereby certify that I am an official of
{insert name of company importing small
diameter graphite electrodes (‘‘SDGE’’) from
UK Carbon and Graphite Co., Ltd.
(‘‘UKCG’’),} and that, to the best of my
knowledge, the SDGE imported under the
following entry numbers was produced from
either reclaimed/reconditioned electrode
inputs or from non Chinese-origin artificial
graphite rod/unfinished SDGE component
inputs:
• Entry # Date of Entry:
• Entry # Date of Entry: * * *
By signing this certificate, the importer
stipulates its understanding that:
• It is the importer’s responsibility to
accurately declare this entry upon
importation to U.S. Customs and Border
Protection (‘‘CBP’’).
• The importer of the above certified
merchandise is required to maintain this
certification for individual entries for the
later of (1) a period of five years from the date
of entry or (2) a period of three years after
the conclusion of any litigation in United
States courts regarding such entries.
• The importer will be required to produce
this certification and the exporter’s
certification upon the request of CBP.
• The importer may be required to produce
additional documentation, sourced from
UKCG, to substantiate the supplier claim
made in the certification in response to a
request from CBP.
• Should further investigation prove this
certification to be false, CBP may take
appropriate action to penalize the importer.
As such, it is the importer’s responsibility to
provide any documentation from UKCG that
may be needed to substantiate the above
certified claims.
• The importer is required to complete this
certification on the date of entry.
• If the importer is not able to demonstrate
that the source of the input used in the
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production of finished SDGE imported from
UKCG is a reclaimed/reconditioned electrode
or a non Chinese-origin artificial graphite
rod/unfinished SDGE component, the
imports are considered subject to the SDGE
Order.
Signature: llllllllllllllll
Printed Name: llllllllllllll
Title: llllllllllllllllll
Date: llllllllllllllllll
Appendix IV
Certification of UK Carbon and Graphite Co.,
Ltd. for Exports of PRC–Origin SDGE
Sourced From PRC–Producers
I hereby certify that I am an official of UK
Carbon and Graphite Co., Ltd. (‘‘UKCG’’) and
that the small diameter graphite electrode
(‘‘SDGE’’) products processed by UKCG in
the United Kingdom into the small diameter
graphite electrodes included within this
shipment pursuant to Invoice numbers: 39
• Invoice
• Invoice * * *
were produced from Chinese-origin artificial
graphite rod/unfinished SDGE component
inputs subject to the antidumping duty order
on small diameter graphite electrodes from
the People’s Republic of China (‘‘PRC’’)
sourced from ll (Name of PRC
Manufacturer, or if the exporter is other than
the manufacturer, the PRC exporter) 40
By signing this certificate, UKCG also
hereby agrees to:
• Maintain sufficient documentation
supporting the above statement for all
Chinese-origin artificial graphite rod/
unfinished SDGE component inputs used to
produce the exported small diameter graphite
electrode products.
• Provide such documentation to the
importer of the merchandise subject to this
certification if required by U.S. Customs and
Border Protection (CBP). UKCG is required to
maintain all such documentation for
individual entries until the later of (1) a
period of five years from the date of entry or
(2) a period of three years after the
conclusion of any litigation in United States
courts regarding such entries.
• Submit to verification by the U.S.
Government of the underlying
documentation supporting the above
statement pursuant to the administration of
an antidumping duty proceeding covering
small diameter graphite electrodes from the
People’s Republic of China.
• Provide this certification to the U.S.
customer/importer at the time of shipment.
UKCG acknowledges that failure to submit
to verification of the documentation by the
U.S. government may result in immediate
revocation of certification rights and under
such circumstances the importer of the
merchandise will be required to post a cash
deposit equal to the China-wide entity rate
39 If an individual invoice reflects the sale of
subject and non-subject merchandise, UKCG shall
provide to the customer/importer two certifications
(and relevant supporting documentation)
identifying the respective subject and non-subject
merchandise, as discussed above.
40 If there is more than one exporter/
manufacturer, identify the exporter/manufacturer
with each product from each invoice.
PO 00000
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Fmt 4703
Sfmt 9990
on all entries of small diameter graphite
electrode products sourced from UKCG. In
addition, if the Department of Commerce
(‘‘Commerce’’) identifies any
misrepresentation or inconsistencies
regarding the certifications, UKCG recognizes
that the matter may be reported to the U.S.
Customs and Border Protection by Commerce
for possible enforcement action.
Signature: llllllllllllllll
Printed Name: llllllllllllll
Title: llllllllllllllllll
Date: llllllllllllllllll
Appendix V
Certification of U.S. Importer for PRC SDGE
Exports
I hereby certify that I am an official of
{insert name of company importing small
diameter graphite electrodes (‘‘SDGE’’) from
UKCG,} and that, to the best of my
knowledge, the SDGE imported under the
following entry numbers was produced from
PRC-origin artificial graphite rod/unfinished
SDGE component inputs:
• Entry # Date of Entry:
• Entry # Date of Entry: * * *
By signing this certificate, the importer
stipulates its understanding that:
• It is the importer’s responsibility to
accurately declare this entry upon
importation to U.S. Customs and Border
Protection (‘‘CBP’’) as an entry subject to
antidumping duties and to accurately report
the cash deposit rate applicable to these
imports.
• The importer of the above certified
merchandise is required to maintain this
certification for individual entries for the
later of (1) a period of five years from the date
of entry or (2) a period of three years after
the conclusion of any litigation in United
States courts regarding such entries.
• The importer will be required to produce
this certification and UKCG’s certification
upon the request of CBP.
• The importer may be required to produce
additional documentation, sourced from
UKCG, to substantiate the supplier claim
made in the certification in response to a
request from CBP.
• Should further investigation prove this
certification to be false, CBP may take
appropriate action to penalize the importer.
As such, it is the importer’s responsibility to
provide any documentation from UKCG that
may be needed to substantiate the above
certified claims.
• The importer is required to complete this
certification on the date of entry.
• For entries of SDGEs from UKCG which
the importer believes should be assessed at
a rate other than the PRC-wide rate, the
importer must have a certification from
UKCG identifying the supplier of the
artificial graphite rod/unfinished SDGE
component inputs subject to the antidumping
duty order on SDGEs from the PRC.
Signature: llllllllllllllll
Printed Name: llllllllllllll
Title: llllllllllllllllll
Date: llllllllllllllllll
[FR Doc. 2012–19578 Filed 8–8–12; 8:45 a.m.]
BILLING CODE 3510–DS–P
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09AUN1
]]>Agencies
[Federal Register Volume 77, Number 154 (Thursday, August 9, 2012)]
[Notices]
[Pages 47596-47602]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-19578]
-----------------------------------------------------------------------
DEPARTMENT OF COMMERCE
International Trade Administration
[A-570-929]
Small Diameter Graphite Electrodes From the People's Republic of
China: Affirmative Final Determination of Circumvention of the
Antidumping Duty Order
AGENCY: Import Administration, International Trade Administration,
Department of Commerce.
SUMMARY: The Department of Commerce (``the Department'') continues to
determine that certain small diameter graphite electrodes (``SDGE'')
are being exported from the United Kingdom (``U.K.'') to the United
States by UK Carbon and Graphite Co., Ltd. (``UKCG'') in circumvention
of the antidumping duty order on SDGE from the People's Republic of
China (``PRC''),\1\ as provided in section 781(b) of the Tariff Act of
1930, as amended (``the Act'').
---------------------------------------------------------------------------
\1\ See Antidumping Duty Order: Small Diameter Graphite
Electrodes from the People's Republic of China, 74 FR 8775 (February
26, 2009) (``SDGE Order'').
---------------------------------------------------------------------------
DATES: Effective Date: August 9, 2012.
FOR FURTHER INFORMATION CONTACT: Brendan Quinn, Office 8, Import
Administration, International Trade Administration, U.S. Department of
Commerce, 14th Street and Constitution Avenue NW., Washington, DC
20230; telephone: (202) 482-5848.
SUPPLEMENTARY INFORMATION:
Background
On June 6, 2012, the Department published in the Federal Register
the affirmative preliminary determination that certain SDGE finished by
UKCG from PRC-produced artificial graphite
[[Page 47597]]
rod/unfinished SDGE component \2\ inputs are exported to the United
States in circumvention of the antidumping duty order on SDGE from the
PRC, as provided in section 781(b) of the Act.\3\ Pursuant to section
781(e) of the Act, on June 8, 2012, the Department notified the U.S.
International Trade Commission (``ITC'') of its affirmative preliminary
determination of circumvention, in accordance with section 781(e) of
the Act, and informed the ITC of its ability to request consultation
with the Department regarding the possible inclusion of the products in
question within the SDGE Order pursuant to section 781(e)(2) of the
Act. On July 6, 2012, the ITC informed the Department that
consultations pursuant to section 781(e)(2) of the Act were not
necessary.
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\2\ According to Petitioners, the unfinished merchandise in
question is defined in UKCG's submissions as, e.g., ``graphite
electrodes,'' ``rods,'' ``graphite billets,'' graphite shapes,''
``synthetic graphite electrode rod,'' and ``re-machined graphite
electrode.'' Petitioners characterize these inputs as ``unfinished
SDGE,'' whereas UKCG refers to them as ``blanks'' or ``artificial
graphite.'' For customs purposes, these materials are, generally,
classified under Harmonized Tariff Schedule (``HTS'') sub-heading
3801.10.00, defined as ``Artificial Graphite; Colloidal or Semi-
Colloidal Graphite; Preparations Based on Graphite or Other Carbon
in the Form of Pastes, Blocks, Plates or Other Semi-Finished
Goods.'' For ease of reference, these materials are referred to as
``unfinished SDGE components'' or ``artificial graphite rods''
throughout this notice.
\3\ See Small Diameter Graphite Electrodes from the People's
Republic of China: Affirmative Preliminary Determination of
Circumvention of the Antidumping Duty Order and Extension of Final
Determination, 77 FR 33405 (June 6, 2012) (``Preliminary
Determination'').
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On June 20, 2012, UKCG, SGL Carbon LLC and Superior Graphite Co.
(``Petitioners''), and the Government of the United Kingdom filed case
briefs. On June 27, 2012, Petitioners and UKCG filed rebuttal briefs.
On July 10, 2012, the Department held a public hearing, based on a
timely filed request by UKCG.\4\
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\4\ See transcript entitled, ``Public Hearing; In the Matter of:
the Anti-circumvention Inquiry of the Antidumping Duty Order on
Small Diameter Graphite Electrodes from the People's Republic of
China (A-570-929) (UKCG),'' dated July 10, 2012 (``Hearing
Transcript'').
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Scope of the Antidumping Duty Order
The merchandise covered by this order includes all small diameter
graphite electrodes of any length, whether or not finished, of a kind
used in furnaces, with a nominal or actual diameter of 400 millimeters
(16 inches) or less, and whether or not attached to a graphite pin
joining system or any other type of joining system or hardware. The
merchandise covered by this order also includes graphite pin joining
systems for small diameter graphite electrodes, of any length, whether
or not finished, of a kind used in furnaces, and whether or not the
graphite pin joining system is attached to, sold with, or sold
separately from, the small diameter graphite electrode. Small diameter
graphite electrodes and graphite pin joining systems for small diameter
graphite electrodes are most commonly used in primary melting, ladle
metallurgy, and specialty furnace applications in industries including
foundries, smelters, and steel refining operations. Small diameter
graphite electrodes and graphite pin joining systems for small diameter
graphite electrodes that are subject to this order are currently
classified under the Harmonized Tariff Schedule of the United States
(``HTSUS'') subheading 8545.11.0000 \5\ and 3801.10.\6\ The HTSUS
number is provided for convenience and customs purposes, but the
written description of the scope is dispositive.
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\5\ The scope described in the SDGE Order refers to the HTSUS
subheading 8545.11.0000. We note that, starting in 2010, imports of
SDGEs are classified in the HTSUS under subheading 8545.11.0010 and
imports of large diameter graphite electrodes are classified under
subheading 8545.11.0020.
\6\ HTSUS subheading 3801.10 is added to the scope of the order
based on a determination in the instant anticircumvention
proceeding. See Summary of Analysis of Statutory Provisions section,
below, and the accompanying Memorandum from Christian Marsh, Deputy
Assistant Secretary for Antidumping and Countervailing Duty
Operations, to Paul Piquado, Assistant Secretary for Import
Administration, Re: ``Anticircumvention Inquiry Regarding the
Antidumping Duty Order on Small Diameter Graphite Electrodes from
the People's Republic of China: Issues and Decision Memorandum for
the Final Determination of the Anticircumvention Inquiry''
(``Decision Memorandum''), dated July 31, 2012 at Comment 6.
---------------------------------------------------------------------------
Scope of the Anticircumvention Inquiry
The products covered by this inquiry are small diameter graphite
electrodes produced by UKCG from PRC-manufactured artificial/synthetic
graphite forms, of a size and shape (e.g., blanks, rods, cylinders,
billets, blocks, etc.) which requires additional machining processes
(i.e., tooling and shaping) to become a finished SDGE (or graphite pin
joining system).\7\ The SDGE products in question are finished graphite
electrodes manufactured by UKCG from PRC-originated artificial graphite
rod/unfinished SDGE components. While UKCG argues that the SDGE it
produces and exports to the United States are of U.K. origin under U.K.
law, the focus and intent of this inquiry is to determine whether
artificial/synthetic graphite forms (1) Manufactured in the PRC; (2)
exported to the United Kingdom for processing/machining (finishing);
and (3) re-exported to the United States as U.K. origin merchandise
constitute circumvention of the SDGE Order under 781(b) of the Act.
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\7\ As noted above, these materials are referred to as
``unfinished SDGE components'' or ``artificial graphite rods''
throughout this notice.
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Analysis of Comments Received
All issues raised in the post-preliminary comments by parties in
this proceeding are addressed in the Decision Memorandum and hereby
adopted by this notice. A list of the issues which the parties raised
and to which the Department responds in the Decision Memorandum is
attached to this notice as Appendix I. The Decision Memorandum is a
public document and is on file electronically via Import
Administration's Antidumping and Countervailing Duty Centralized
Electronic Service System (``IA ACCESS''). Access to IA ACCESS is
available in the Central Records Unit, room 7046 of the main Department
of Commerce building. In addition, a complete version of the Decision
Memorandum can be accessed directly on the Internet at https://www.trade.gov/ia/. The signed Decision Memorandum and the electronic
versions of the Decision Memorandum are identical in content.
Affirmative Final Determination of Circumvention
For the final determination, we continue to rely on the statutory
criteria that we considered in making our Preliminary Determination.\8\
Based on our review of the record evidence and our analysis of the
comments received, the Department continues to find that certain SDGE
finished by UKCG from PRC-produced artificial graphite rod/unfinished
SDGE component inputs are exported to the United States in
circumvention of the antidumping duty order on SDGE from the PRC. For a
complete discussion of the Department's analysis, see the accompanying
Decision Memorandum.
---------------------------------------------------------------------------
\8\ See Preliminary Determination, 77 FR at 33409.
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Summary of Analysis of Statutory Provisions
(A) Whether Merchandise Imported Into The United States Is of the Same
Class Or Kind As Merchandise That Is Subject To The SDGE Order
As noted in the Preliminary Determination, the finished products,
as sold by UKCG to the United States, are identical to those covered by
the SDGE Order.\9\ No interested party to this
[[Page 47598]]
proceeding has contested this fact during the course of the inquiry. As
such, we continue to find that the finished SDGE products exported to
the United States by UKCG are of the same class or kind as other
merchandise that is subject to the SDGE Order.
---------------------------------------------------------------------------
\9\ See Preliminary Determination, 77 FR at 33410.
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(B) Whether, Before Importation Into The United States, Such Imported
Merchandise Is Completed or Assembled In A Third Country From
Merchandise Which Is Subject To The Order or Produced In The Foreign
Country That Is Subject To The Order
Pursuant to section 781(b)(1)(B) of the Act, and consistent with
our findings in the Preliminary Determination, we continue to find that
the totality of the sourcing/procurement information and corresponding
sales documentation on record clearly demonstrate that the inputs in
question are produced in the foreign country that is subject to the
SDGE Order.\10\
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\10\ See id., 77 FR at 33410-11. See also Memorandum from the
Department entitled, ``Anti-Circumvention Inquiry Regarding the
Antidumping Duty Order on Small Diameter Graphite Electrodes from
the People's Republic of China: Preliminary Determination Analysis
Memorandum of U.K. Carbon and Graphite Co., Ltd.,'' dated May 30,
2012 (``Preliminary Analysis Memorandum'') at 5-8 and Attachment II.
---------------------------------------------------------------------------
Additionally, as discussed at length in the accompanying Decision
Memorandum at Comment 1, the Department has analyzed the arguments with
respect to the in-scope nature of UKCG's artificial graphite rod/
unfinished SDGE component inputs and continues to find that the ``rod''
inputs constitute unfinished SDGE explicitly included within the scope
of the SDGE Order.\11\ As a result, the Department finds that certain
subject merchandise may be properly categorized under HTSUS subheading
3801.10. Because HTSUS numbers are included in the scope language for
convenience and customs purposes, we are adding this HTS subheading to
the scope language of the SDGE Order to aid U.S. Customs and Border
Protection (``CBP'') by clarifying that products categorized under the
HTSUS 3801.10 category, as imported, which otherwise fit the narrative
description of unfinished products covered by the SDGE Order, should be
considered merchandise subject to the order.\12\
---------------------------------------------------------------------------
\11\ See Decision Memorandum at Comment 1.
\12\ See Decision Memorandum at Comment 6.
---------------------------------------------------------------------------
(C) Whether the Process of Assembly or Completion in the Third Country
is Minor or Insignificant
Pursuant to section 781(b)(1)(C) of the Act, 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:
781(b)(2)(A): The level of investment in the third country;
781(b)(2)(B): The level of research and development (``R&D'') in
the third country;
781(b)(2)(C): The nature of the production process in the third
country;
781(b)(2)(D): The extent of the production facilities in the third
country; and
781(b)(2)(E): Whether the value of the processing performed in the
third country represents a small proportion of the value of the
merchandise imported into the United States.
The SAA explains that no single factor listed in section 781(b)(2)
of the Act will be controlling.\13\ Accordingly, it is the Department's
practice to evaluate each of the factors as they exist in the United
States or foreign country depending on the particular anticircumvention
inquiry.\14\ In this anticircumvention inquiry, based on the record, we
have considered and evaluated each statutory criterion and all factors
in determining whether the process of converting the PRC-sourced
artificial graphite rod/unfinished SDGE component inputs in the U.K.
was minor or insignificant, in accordance with section 781(b)(2) of the
Act, consistent with our analysis in prior anticircumvention
inquiries.\15\
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\13\ See Statement of Administrative Action accompanying the
Uruguay Round Agreements Act, H.R. Doc. 103-316, vol. 1 (1994)
(``SAA'') at 893.
\14\ See Certain Tissue Paper Products from the People's
Republic of China: Affirmative Final Determination of Circumvention
of the Antidumping Duty Order, 73 FR 57591 (October 3, 2008) at
57592.
\15\ See, e.g., Anticircumvention Inquiry of the Antidumping and
Countervailing Duty Orders on Certain Pasta From Italy: Affirmative
Preliminary Determinations of Circumvention of Antidumping and
Countervailing Duty Orders, 68 FR 46571 (August 6, 2003) (``Pasta
Circumvention Prelim''), unchanged in Anticircumvention Inquiry of
the Antidumping and Countervailing Duty Orders on Certain Pasta from
Italy: Affirmative Final Determinations of Circumvention of
Antidumping and Countervailing Duty Orders, 68 FR 54888 (September
19, 2003) (``Pasta Circumvention Final''); and Hot-Rolled Lead and
Bismuth Carbon Steel Products from Germany and the United Kingdom;
Negative Final Determination of Circumvention of Antidumping and
Countervailing Duty Orders, 64 FR 40336, 40347-48 (July 26, 1999)
(explaining that Congress has directed the Department to focus more
on the nature of the production process and less on the difference
in value between the subject merchandise and the imported parts or
components and that any attempt to establish a numerical standard
would be contrary to the intent of Congress).
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Analysis of 781(b)(2)(A),(B),(C), & (D): The Levels of Investment, R&D,
The Nature of Production Processes, and Extent of Production Facilities
in the United Kingdom
Pursuant to sections 781(b)(2)(A)-(D) of the Act, the Department
continues to find, consistent with our Preliminary Determination, that
the information on record with respect to UKCG's investment, R&D,
production processes and production facilities continues to support the
conclusion that the process of assembly or completion occurring in the
United Kingdom is minor or insignificant in comparison to the totality
of the production of subject merchandise.
Analysis of 781(b)(2)(E): Whether the Value of the Processing Performed
in the United Kingdom Represents a Small Proportion of the Value of the
Merchandise Imported Into the United States
For the Preliminary Determination, the Department utilized a
quantitative analysis to determine the proportion of UKCG's further
processing value by comparing UKCG's further processing costs to the
actual value of the merchandise exported to the United States during
the period of review (i.e., U.S. price) and preliminarily found that
the UKCG's value-added comprised only a small proportion of the total
export value. The Department concluded that this quantitative finding
lent additional support to the qualitative finding and that, pursuant
to section 781(b)(2)(E) of the Act, the value of UKCG's processing
represents a small proportion of the value of the merchandise sold in
the United States.\16\
---------------------------------------------------------------------------
\16\ See Preliminary Determination 77 FR at 33413-15. See also
Preliminary Analysis Memorandum at 16-18 and Attachment VI.
---------------------------------------------------------------------------
For this final determination, the Department agrees with UKCG that
the methodology we used for the analysis under section 781(b)(2)(E) of
the Act for Preliminary Determination warrants modification, but only
to the extent that our measurement of the value-added in the United
Kingdom did not properly account for profit (as well as selling,
general, and administrative (``SG&A'') expenses and interest expenses)
in the numerator of the calculation. We find that the inclusion of an
amount for SG&A, interest, and profit would help to better reflect the
value-added to the finished product in the United Kingdom. However, we
do not agree with UKCG's suggested methodology. Instead, we have
amended the Preliminary Determination calculation so that UKCG's profit
margin and SG&A
[[Page 47599]]
and interest ratios are added to the reported further manufacturing
cost.\17\ While the revised value-added figure increases the value-
added figure used in the Preliminary Determination, the Department
finds that this figure still represents a small proportion of the
overall sales value as exported to the United States. As a result, we
continue to find that this criterion supports finding that the process
of completion in the UK is minor.\18\
---------------------------------------------------------------------------
\17\ See Memorandum from the Department entitled,
``Anticircumvention Inquiry Regarding the Antidumping Duty Order on
Small Diameter Graphite Electrodes from the People's Republic of
China: Final Determination Analysis Memorandum of U.K. Carbon and
Graphite Co., Ltd.,'' dated July 31, 2012 (``Final Analysis
Memorandum'').
\18\ Information about the value-added figure is business
proprietary. See Final Analysis Memorandum for exact values. See
also ``Overall Analysis'' section, below, and Decision Memorandum at
Comment 3.
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Overall Analysis of Section 781(b)(1)(C) of the Act (i.e., Sections
781(b)(2)(A)-(E) of the Act)
As discussed above and in the Preliminary Determination, it is
clear from the legislative history that an analysis of possible
circumvention should not be based solely on a quantitative analysis,
but rather should examine the value added in qualitative terms as
well.\19\ The SAA also explains that no single factor listed in section
781(b)(2) of the Act will be controlling. Accordingly, it is the
Department's practice to evaluate each of the factors as they exist in
the United States or foreign country depending on the particular
circumvention scenario. Therefore, the importance of any one of the
factors listed under section 781(b)(2) of the Act can vary from case to
case depending on the particular circumstances unique to each
circumvention inquiry.
---------------------------------------------------------------------------
\19\ See Preliminary Determination 77 FR at 33413, citing to SAA
at 893 (1994).
---------------------------------------------------------------------------
In this anticircumvention inquiry, we based our analysis on both
qualitative and quantitative factors in determining whether the process
of finishing the SDGE in the United Kingdom was minor or insignificant,
in accordance with the criteria of section 781(b)(2) of the Act. This
approach is consistent with our analysis in prior circumvention
inquiries.\20\ Based on the above analysis, we determine that the
process of finishing performed by UKCG in the United Kingdom is minor
or insignificant primarily because we determine that the nature of the
processing is minor when compared to the production of SDGE from raw
materials and the value of the processing performed by UKCG in the
United Kingdom represents a small proportion of the value of the
merchandise imported into the United States. This qualitative
determination is based on our analysis with respect to sections
781(b)(2)(A),(B),(C), and (D) of the Act (as laid out in the
Preliminary Determination and summarized above), as well as our finding
that the input material itself constitutes merchandise subject to the
SDGE Order. As stated in the Preliminary Determination, ``while the
Department believes that this qualitative analysis is sufficient to
determine whether the value of processing in the third country
constitutes a small portion of the value of the merchandise exported to
the United States, the Department has obtained the information
necessary to {quantitatively{time} evaluate the proportion of UKCG's
processing.'' \21\ Thus, the quantitative analysis in the Preliminary
Determination was issued in support of the qualitative finding based on
the availability of the relevant data, but the Department plainly noted
that the qualitative finding of relatively insignificant value added
was, by itself, sufficient to fulfill the analysis required pursuant to
section 781(b)(2)(E) of the Act. Although the Department has amended
the methodology used to conduct this quantitative analysis for the
instant final determination, as noted above, we find that the resultant
values continue to indicate that the value added in the United Kingdom
represents a small proportion of the overall sales value as exported to
the United States. Further, we continue to find that the qualitative
determination is itself sufficient and determinative to address the
value-added criteria under the statute and that the corresponding
quantitative analysis supports the Department's qualitative
determination on this issue.\22\
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\20\ See, e.g., Pasta Circumvention Prelim 68 FR at 46574
(unchanged in Pasta Circumvention Final).
\21\ See Preliminary Determination at 33413.
\22\ See Decision Memorandum at Comment 3. See also Final
Analysis Memorandum.
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(D) Whether the Value of the Merchandise Produced in the Foreign
Country to Which the Order Applies Is a Significant Portion of the
Total Value of the Merchandise Exported to the United States
Because key elements of the Department's analysis under section
781(b)(1)(D) of the Act necessitate obtaining a value for an NME input,
the Department determined that an analysis of UKCG's input costs falls
under the purview of the Department's NME methodology and, therefore,
utilized a surrogate value (``SV'') to value UKCG's PRC-sourced
artificial graphite rod/unfinished SDGE component inputs, consistent
with both section 773(c)(1) of the Act as well as the Department's past
practice.\23\ As a result, the Department determined that the
appropriate calculation required by section 781(b)(1)(D) of the Act
expresses the SV for the artificial graphite rod/unfinished SDGE
component inputs in question as a percentage of UKCG's reported total
sales value and found that the PRC-produced merchandise represents a
significant percentage of the sales value of UKCG's U.S. exports of
finished merchandise.\24\ A full discussion of the propriety of
utilizing the Department's SV methodology with respect to the valuation
of UKCG's inputs is provided in Comment 2 of the accompanying Decision
Memorandum.
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\23\ See Preliminary Determination 77 FR at 33407-09, citing to,
e.g., Steel Wire Garment Hangers from the People's Republic of
China: Affirmative Preliminary Determination of Circumvention of the
Antidumping Duty Order and Extension of Final Determination, 76 FR
27007 (May 10, 2011) (``Hangers Anticircumvention Prelim'') at
27008, unchanged in Steel Wire Garment Hangers From the People's
Republic of China: Affirmative Final Determination of Circumvention
of the Antidumping Duty Order, 76 FR 66895 (October 28, 2011)
(``Hangers Anticircumvention Final'').
\24\ See Preliminary Determination 77 FR at 33415. See also
Preliminary Analysis Memo for a discussion of the exact values used,
as this information is business proprietary.
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Other Factors To Consider
In making a determination whether to include merchandise assembled
or completed in a foreign country within an order, section 781(b)(3) of
the Act instructs the Department to take into account such factors as:
(A) The pattern of trade, including sourcing patterns; (B) whether
affiliation exists between the manufacturer or exporter of the
merchandise in the country subject to the order and the person who uses
the merchandise to assemble or complete in the third country the
merchandise that is exported to the United States; and (C) whether
imports into the third country of the merchandise described in section
781(b)(1)(B) of the Act have increased since the initiation of the
original investigation. In the Preliminary Determination the Department
found that:
(A) Record information demonstrated that PRC exports of SDGE to the
United States have decreased significantly whereas U.K. exports of SDGE
to the United States, UKCG's exports of SDGE to the United States, and
UKCG's sourcing of relevant inputs from the PRC, have increased since
the initiation of the less-than-fair-value (``LTFV'') investigation.
These patterns of trade
[[Page 47600]]
support a finding that circumvention has occurred.\25\
---------------------------------------------------------------------------
\25\ See Preliminary Determination 77 FR at 33416-17. See also
Preliminary Analysis Memorandum at 20-22 and Attachments VII-XII
---------------------------------------------------------------------------
(B) UKCG is not affiliated with any PRC-producers of artificial
graphite rod/unfinished SDGE component inputs.\26\
---------------------------------------------------------------------------
\26\ See Preliminary Determination 77 FR at 33417.
---------------------------------------------------------------------------
(C) In addition to the aforementioned increase in UKCG's sourcing
of relevant inputs from the PRC, PRC exports of artificial graphite to
the United Kingdom have also increased significantly since the
initiation of the LTFV investigation.\27\
---------------------------------------------------------------------------
\27\ See Preliminary Determination 77 FR at 33417. See also
Preliminary Analysis Memorandum at 23 and Attachments VII-XII.
---------------------------------------------------------------------------
No party to this proceeding has challenged any of the
aforementioned findings since the issuance of the Preliminary
Determination. The Department continues to find that UKCG is not
affiliated with any of its PRC-producers of artificial graphite rod/
unfinished SDGE component inputs. However, the totality of the pattern
of trade data--which shows an increase with respect to UKCG's
importation of artificial graphite rod/unfinished SDGE component inputs
from the PRC and exports of finished SDGE to the United States from the
United Kingdom, an increase of artificial graphite imports into the
United Kingdom on the whole, and a corresponding decrease in finished
SDGE exported to the United States from the PRC--supports an
affirmative determination of circumvention.
Summary of Statutory Analysis
We find that UKCG has circumvented the SDGE Order in accordance
with sections 781(b)(1) and (2) of the Act. Pursuant to sections
781(b)(1)(A) and (B) of the Act, we find that the merchandise sold in
the United States is identical to merchandise that is subject to the
SDGE Order and was completed in the United Kingdom from merchandise
which is: (a) Covered by the explicit language of the scope of the SDGE
Order, and (b) produced in the PRC, the country to which the SDGE Order
applies. Additionally, pursuant to section 781(b)(1)(C) of the Act, we
find the process of completion in the United Kingdom to be minor and
insignificant based on each facet of the analysis under section
781(b)(2) of the Act. Furthermore, in accordance with section
781(b)(1)(D) of the Act, we find that the value of the merchandise
produced in the PRC is a significant portion of the total value of the
merchandise exported to the United States. Finally, upon taking into
consideration section 781(b)(3) of the Act, our analysis of the pattern
of trade, including sourcing, and an affirmative finding of an increase
in imports of artificial graphite/unfinished SDGE into the United
Kingdom from the PRC since the initiation of the initial LTFV
investigation, we conclude that action is appropriate to prevent
circumvention of the SDGE Order pursuant to 781(b)(1)(E) of the Act.
Consequently, our statutory analysis leads us to find that, during the
period of time examined, there was circumvention of the SDGE Order as a
result of UKCG's processing/machining of the PRC-origin artificial
graphite/unfinished SDGE components to finished SDGE in the United
Kingdom, as discussed above.
Continuation of Suspension of Liquidation
Based on the record evidence, the Department has determined that
UKCG is able to provide documentation to its U.S. importers that
identifies the input supplier for each SDGE UKCG sold in the United
States.\28\ As a result, the Department is requiring UKCG and its
importers to prepare and maintain certifications regarding the
supplier.\29\ Additionally, for all merchandise exported by UKCG where
the supplier was a PRC-entity, the Department will direct CBP to
require cash deposits at the rate established for the PRC supplier if
that supplier has its own rate or, alternatively, at the PRC-wide rate
of 159.64 percent if the PRC supplier does not have its own rate or if
the importer cannot identify the supplier.
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\28\ See Preliminary Determination 77 FR at 33417-18.
\29\ See id. 77 FR at 33417-18 and the certifications provided
at 77 FR 33419-33420. See also Appendices II, III, IV, and V to this
notice.
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The Department continues to find that its preliminary cash deposit
instructions are fully consistent with the Department's obligations
under section 781(b) of the Act.\30\ The Department concludes, pursuant
to Section 781(b) of the Act, that SDGE finished by UKCG from PRC-
produced inputs covered under the narrative description of the scope of
the SDGE Order, are being exported to the United States in
circumvention of the SDGE Order, and that the appropriate means of
addressing that circumvention is to collect cash deposits on all
merchandise meeting that description. As such, we find it appropriate
and consistent with past practice to instruct CBP to suspend
liquidation and collect cash deposits on all unliquidated entries of
SDGE produced by UKCG from PRC-manufactured unfinished SDGE inputs at
the rate applicable to the relevant PRC-manufacturer, including the
PRC-wide entity if applicable.\31\ In requiring that CBP collect cash
deposits on UKCG's exports of SDGE found to be in circumvention of the
antidumping order as appropriate, the Department is making no final
determination of UKCG's dumping duty liability at this time.\32\
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\30\ See Decision Memorandum at Comment 5.
\31\ See Certain Tissue Paper Products From the People's
Republic of China: Affirmative Final Determination of Circumvention
of the Antidumping Duty Order, 76 FR 47551 (August 5, 2011), and
accompanying Issues and Decision Memorandum at Comments 4 and 5. For
a full discussion of this issue, see the accompanying Decision
Memorandum at Comment 5.
\32\ See Decision Memorandum at Comment 5.
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Accordingly, the Department will continue to direct CBP to suspend
liquidation and to require a cash deposit of estimated duties at the
applicable rate on unliquidated entries of SDGE produced and/or
exported by UKCG that were entered, or withdrawn from warehouse, for
consumption on or after March 18, 2011, the date of initiation of the
anticircumvention inquiry. Where the importer can demonstrate that the
primary input material was produced by a company that has a separate
rate, CBP will collect that company's cash deposit rate. Where the
importer can demonstrate that the SDGE at issue was produced from
reclaimed/reconditioned electrode inputs \33\ or artificial graphite
rod/unfinished SDGE component inputs sourced from a third country
producer, CBP should not suspend those entries or collect AD duties on
those entries. For all other entries of merchandise exported by UKCG,
CBP will require a cash deposit equal to the PRC-wide rate of 159.64
percent.
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\33\ As noted in the Preliminary Determination 77 FR at 33418,
UKCG purchases broken/cracked or otherwise unusable electrodes from
sources in various non-PRC countries, refurbishes them, and re-sells
them for use as finished electrodes. The broken, cracked, or
otherwise unusable electrode inputs sourced by UKCG are
``reclaimed'' electrodes, whereas the resulting finished product is
a ``remanufactured,'' ``remachined,'' or ``reconditioned''
electrode. For ease of reference, these products are referred to as
``reclaimed/reconditioned'' electrodes.
---------------------------------------------------------------------------
For all entries of finished SDGE produced from artificial graphite
rod/unfinished SDGE component inputs subject to the scope of this
anticircumvention proceeding which UKCG believes should be assessed at
a rate other than the PRC-wide rate, UKCG is required to furnish its
customers/importers with a certification identifying, as appropriate,
the manufacturer/exporter of the primary input into the SDGE it
processes in the U.K. prior to exportation to the United States. For
all entries of SDGE produced from inputs not subject to the scope of
[[Page 47601]]
this anticircumvention proceeding (i.e., SDGE produced from reclaimed/
reconditioned inputs or inputs produced in a third country), UKCG is
required to furnish its customers/importers with a certification
identifying the supplier or producer (as appropriate) of the primary
input into the SDGE it processes in the U.K. prior to exportation to
the United States.\34\ Importers are also required to sign and maintain
certifications for these types of entries. The certification formats
are provided in Appendices II, III, IV, and V to this notice.\35\ The
importer will be required to retain each certificate for individual
entries for the later of: (1) A period of five years from the date of
entry or (2) a period of three years after the conclusion of any
antidumping duty litigation regarding such entries. It is the
importer's responsibility to accurately declare to CBP the appropriate
antidumping duty rate (or that no antidumping duty applies) for each
entry.
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\34\ See Decision Memorandum at Comment 4.
\35\ The certification language has been slightly modified from
that proposed in the Preliminary Determination to reflect the
results of this final determination. See Decision Memorandum at
Comment 4.
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Accordingly, the Department will instruct CBP to: (i) Require cash
deposits at the rate established for the PRC supplier if that supplier
has its own rate; (ii) require cash deposits at the PRC-wide rate of
159.64 percent if the PRC supplier does not have its own rate or if the
importer cannot identify the supplier. If the importer is able to
demonstrate through the above-referenced certification process that the
source of the artificial graphite rod/unfinished SDGE component inputs
used in the production of finished SDGE imported from UKCG is not of
PRC-origin or the finished SDGE is produced from reclaimed/
reconditioned inputs, then no suspension of liquidation or cash deposit
is required.\36\ These instructions will apply to entries of SDGE
produced and/or exported by UKCG that were entered, or withdrawn from
warehouse, for consumption on or after March 18, 2011, the date of
initiation of the anticircumvention inquiry. For unliquidated entries
made prior to March 18, 2011, UKCG will not be required to provide the
above-noted documentation to the importer. The importer will be
required to provide the documentation to CBP within the time frame
established by CBP. Consistent with past practice the Department has
determined that a third-country antidumping duties case number for the
United Kingdom is necessary as part of this determination for importers
to identify merchandise as subject merchandise, and to ensure that CBP
can collect antidumping duties on subject SDGEs that are processed in
and exported from the United Kingdom.\37\
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\36\ The exporter-supplied certification will serve as the
initial demonstration supporting the importer's claim regarding
which antidumping duty rate (or that no antidumping duty rate) is
applicable. However, should CPB determine that further demonstration
is warranted, it may seek additional documentation from the importer
pursuant to 19 CFR 163.6(a) and other applicable regulations and
statutory authority. Under 19 CFR 163.6(a), CBP may require the
production of entry records from any party required to maintain such
records as defined in 19 CFR 163.2(a). 19 CFR 163.1(a)(2)(vii)
defines such records to include any information made or normally
kept in the ordinary course of business that pertains to an activity
``required to be undertaken pursuant to the laws or regulations
administered by Customs,'' which would include the proper assessment
of antidumping duties. As such, for the purpose of demonstrating
that a rate other than the PRC-wide rate should be assessed to
entries subject to this anticircumvention proceeding, UKCG should be
prepared to provide to its importers, where applicable,
documentation to substantiate the supplier claim made on the UKCG
certification to the importer. Thus, if CBP should determine further
demonstration is necessary and request supporting documentation from
the importer, UKCG will be responsible for providing to the importer
additional documentation pursuant to 19 CFR 163.6(a) to substantiate
the certification.
\37\ See, e.g., Laminated Woven Sacks From the People's Republic
of China: Final Results of First Antidumping Duty Administrative
Review, 76 FR 14906, 14907 (March 18, 2011) (noting that ``the
Department has coordinated with CBP to resolve issues arising from
differences between the Department's and CBP's respective country-
of-origin classifications and from technical restrictions in CBP's
electronic filing systems. As a result, the Department has added
several case numbers to the Case Reference file within the Automated
Commercial Environment to ensure that requisite entries are and can
be properly claimed as scope merchandise.'').
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Notification to Interested Parties
This notice serves as the only reminder to parties subject to the
administrative protective order (``APO'') of their responsibility
concerning the return or destruction of proprietary information
disclosed under APO in accordance with 19 CFR 351.305. Timely written
notification of the return or destruction of APO materials or
conversion to judicial protective order is hereby requested. Failure to
comply with the regulations and terms of an APO is a violation which is
subject to sanction.
This final affirmative circumvention determination is published in
accordance with section 781(b) of the Act and 19 CFR 351.225(h).
Dated: July 31, 2012.
Paul Piquado,
Assistant Secretary for Import Administration.
Appendix I
Discussion of the Issues
Comment 1: Whether ``Rods'' Are Covered Under the Scope of the Order
Comment 2: Use of Ukrainian Surrogate Values To Value Artificial
Graphite Rod/Unfinished SDGE Component Inputs
Comment 3: Value-Added Methodology
Comment 4: Whether To Include Reconditioned Products in the Scope of
the Anticircumvention Inquiry
Comment 5: Cash Deposit and Assessment of AD Duties
Comment 6: Inclusion of HTSUS Subheading 3801.10 in the Scope of the
Order
Comment 7: Clarification That Graphitization Confers Country of
Origin
Appendix II
Certification of UK Carbon and Graphite Co., Ltd. for SDGE Exports
Produced From Reclaimed/Reconditioned Electrode Inputs or From Non-
Chinese-Origin Artificial Graphite Rod/Unfinished SDGE Component Inputs
I hereby certify that I am an official of UK Carbon and Graphite
Co., Ltd. (``UKCG'') and that that the small diameter graphite
electrode products processed by UKCG in the United Kingdom into the
small diameter graphite electrodes included within this shipment
pursuant to Invoice numbers: \38\
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\38\ If an individual invoice is representative of merchandise
produced from both Chinese-origin artificial graphite rod inputs, as
well as non-subject inputs, UKCG shall identify the non-subject
merchandise in this certification, and will provide a companion
certification identifying the subject merchandise based on the
certification provided below in Appendix IV.
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Invoice
Invoice * * *
were produced from reclaimed/reconditioned electrode inputs or from
non Chinese-origin artificial graphite rod/unfinished SDGE component
inputs.
By signing this certificate, UKCG also hereby agrees to:
Maintain sufficient documentation supporting the above
statement for all reclaimed/reconditioned electrode inputs or non
Chinese-origin artificial graphite rod/unfinished SDGE component
inputs used to produce the exported small diameter graphite
electrode products.
Provide such documentation to the importer of the
merchandise subject to this certification if required by U.S.
Customs and Border Protection (``CBP''). UKCG is required to
maintain all such documentation for individual entries until the
later of (1) a period of five years from the date of entry or (2) a
period of three years after the conclusion of any litigation in
United States courts regarding such entries.
Submit to verification by the U.S. Government of the
underlying documentation supporting the above statement pursuant to
the administration of
[[Page 47602]]
an antidumping duty proceeding covering small diameter graphite
electrodes from the People's Republic of China.
Provide this certification to the U.S. customer/
importer at the time of shipment.
UKCG acknowledges that failure to submit to verification of the
documentation by the U.S. Government may result in immediate
revocation of certification rights and under such circumstances the
importer of the merchandise will be required to post a cash deposit
equal to the PRC-wide entity rate on all entries of small diameter
graphite electrode products sourced from UKCG. In addition, if the
Department of Commerce (``Commerce'') identifies any
misrepresentation or inconsistencies regarding the certifications,
UKCG recognizes that the matter may be reported to CBP by Commerce
for possible enforcement action.
Signature:-------------------------------------------------------------
Printed Name:----------------------------------------------------------
Title:-----------------------------------------------------------------
Date:------------------------------------------------------------------
Appendix III
Certification of U.S. Importer for SDGE Exports Produced From
Reclaimed/Reconditioned Electrode Inputs or From Non-Chinese-Origin
Artificial Graphite Rod/Unfinished SDGE Component Inputs
I hereby certify that I am an official of {insert name of
company importing small diameter graphite electrodes (``SDGE'') from
UK Carbon and Graphite Co., Ltd. (``UKCG''),{time} and that, to the
best of my knowledge, the SDGE imported under the following entry
numbers was produced from either reclaimed/reconditioned electrode
inputs or from non Chinese-origin artificial graphite rod/unfinished
SDGE component inputs:
Entry Date of Entry:
Entry Date of Entry: * * *
By signing this certificate, the importer stipulates its
understanding that:
It is the importer's responsibility to accurately
declare this entry upon importation to U.S. Customs and Border
Protection (``CBP'').
The importer of the above certified merchandise is
required to maintain this certification for individual entries for
the later of (1) a period of five years from the date of entry or
(2) a period of three years after the conclusion of any litigation
in United States courts regarding such entries.
The importer will be required to produce this
certification and the exporter's certification upon the request of
CBP.
The importer may be required to produce additional
documentation, sourced from UKCG, to substantiate the supplier claim
made in the certification in response to a request from CBP.
Should further investigation prove this certification
to be false, CBP may take appropriate action to penalize the
importer. As such, it is the importer's responsibility to provide
any documentation from UKCG that may be needed to substantiate the
above certified claims.
The importer is required to complete this certification
on the date of entry.
If the importer is not able to demonstrate that the
source of the input used in the production of finished SDGE imported
from UKCG is a reclaimed/reconditioned electrode or a non Chinese-
origin artificial graphite rod/unfinished SDGE component, the
imports are considered subject to the SDGE Order.
Signature:-------------------------------------------------------------
Printed Name:----------------------------------------------------------
Title:-----------------------------------------------------------------
Date:------------------------------------------------------------------
Appendix IV
Certification of UK Carbon and Graphite Co., Ltd. for Exports of PRC-
Origin SDGE Sourced From PRC-Producers
I hereby certify that I am an official of UK Carbon and Graphite
Co., Ltd. (``UKCG'') and that the small diameter graphite electrode
(``SDGE'') products processed by UKCG in the United Kingdom into the
small diameter graphite electrodes included within this shipment
pursuant to Invoice numbers: \39\
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\39\ If an individual invoice reflects the sale of subject and
non-subject merchandise, UKCG shall provide to the customer/importer
two certifications (and relevant supporting documentation)
identifying the respective subject and non-subject merchandise, as
discussed above.
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Invoice
Invoice * * *
were produced from Chinese-origin artificial graphite rod/unfinished
SDGE component inputs subject to the antidumping duty order on small
diameter graphite electrodes from the People's Republic of China
(``PRC'') sourced from ---- (Name of PRC Manufacturer, or if the
exporter is other than the manufacturer, the PRC exporter) \40\
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\40\ If there is more than one exporter/manufacturer, identify
the exporter/manufacturer with each product from each invoice.
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By signing this certificate, UKCG also hereby agrees to:
Maintain sufficient documentation supporting the above
statement for all Chinese-origin artificial graphite rod/unfinished
SDGE component inputs used to produce the exported small diameter
graphite electrode products.
Provide such documentation to the importer of the
merchandise subject to this certification if required by U.S.
Customs and Border Protection (CBP). UKCG is required to maintain
all such documentation for individual entries until the later of (1)
a period of five years from the date of entry or (2) a period of
three years after the conclusion of any litigation in United States
courts regarding such entries.
Submit to verification by the U.S. Government of the
underlying documentation supporting the above statement pursuant to
the administration of an antidumping duty proceeding covering small
diameter graphite electrodes from the People's Republic of China.
Provide this certification to the U.S. customer/
importer at the time of shipment.
UKCG acknowledges that failure to submit to verification of the
documentation by the U.S. government may result in immediate
revocation of certification rights and under such circumstances the
importer of the merchandise will be required to post a cash deposit
equal to the China-wide entity rate on all entries of small diameter
graphite electrode products sourced from UKCG. In addition, if the
Department of Commerce (``Commerce'') identifies any
misrepresentation or inconsistencies regarding the certifications,
UKCG recognizes that the matter may be reported to the U.S. Customs
and Border Protection by Commerce for possible enforcement action.
Signature:-------------------------------------------------------------
Printed Name:----------------------------------------------------------
Title:-----------------------------------------------------------------
Date:------------------------------------------------------------------
Appendix V
Certification of U.S. Importer for PRC SDGE Exports
I hereby certify that I am an official of {insert name of
company importing small diameter graphite electrodes (``SDGE'') from
UKCG,{time} and that, to the best of my knowledge, the SDGE
imported under the following entry numbers was produced from PRC-
origin artificial graphite rod/unfinished SDGE component inputs:
Entry Date of Entry:
Entry Date of Entry: * * *
By signing this certificate, the importer stipulates its
understanding that:
It is the importer's responsibility to accurately
declare this entry upon importation to U.S. Customs and Border
Protection (``CBP'') as an entry subject to antidumping duties and
to accurately report the cash deposit rate applicable to these
imports.
The importer of the above certified merchandise is
required to maintain this certification for individual entries for
the later of (1) a period of five years from the date of entry or
(2) a period of three years after the conclusion of any litigation
in United States courts regarding such entries.
The importer will be required to produce this
certification and UKCG's certification upon the request of CBP.
The importer may be required to produce additional
documentation, sourced from UKCG, to substantiate the supplier claim
made in the certification in response to a request from CBP.
Should further investigation prove this certification
to be false, CBP may take appropriate action to penalize the
importer. As such, it is the importer's responsibility to provide
any documentation from UKCG that may be needed to substantiate the
above certified claims.
The importer is required to complete this certification
on the date of entry.
For entries of SDGEs from UKCG which the importer
believes should be assessed at a rate other than the PRC-wide rate,
the importer must have a certification from UKCG identifying the
supplier of the artificial graphite rod/unfinished SDGE component
inputs subject to the antidumping duty order on SDGEs from the PRC.
Signature:-------------------------------------------------------------
Printed Name:----------------------------------------------------------
Title:-----------------------------------------------------------------
Date:------------------------------------------------------------------
[FR Doc. 2012-19578 Filed 8-8-12; 8:45 a.m.]
BILLING CODE 3510-DS-P
