Certain Uncoated Paper From Australia, Brazil, the People's Republic of China, Indonesia, and Portugal: Initiation of Anti-Circumvention Inquiry, 78117-78120 [2016-26847]

Download as PDF Federal Register / Vol. 81, No. 215 / Monday, November 7, 2016 / Notices Privilege, the cash deposit rate will be that established in the final results of this review (except, if the rate is zero or de minimis, then zero cash deposit will be required) and the Department will collect cash deposits only on Enchant Privilege’s PRC-origin merchandise; (2) for previously investigated or reviewed PRC and non-PRC exporters not listed above that received a separate rate in a prior segment of this proceeding, the cash deposit rate will continue to be the existing exporter-specific rate published for the most recently completed period; (3) for all PRC exporters of subject merchandise that have not been found to be entitled to a separate rate, the cash deposit rate will be the PRC-wide rate of 234.51 percent; and (4) for all nonPRC exporters of subject merchandise which have not received their own rate, the cash deposit rate will be the rate applicable to the PRC exporter that supplied that non-PRC exporter. These deposit requirements, when imposed, shall remain in effect until further notice. Assessment Rates Upon issuance of the final results, the Department will determine, and U.S. Customs and Border Protection (CBP) shall assess, antidumping duties on all appropriate entries covered by this review.11 The Department intends to issue assessment instructions to CBP 15 days after the publication date of the final results of this review. We will instruct CBP to assess duties at the ad valorem margin rate published above. We will instruct CBP to assess antidumping duties on all appropriate entries covered by this review if any assessment rate calculated in the final results of this review is above de minimis. The final results of this review shall be the basis for the assessment of antidumping duties on entries of merchandise covered by the final results of this review and for future deposits of estimated duties, where applicable. The Department will assess duties only on entries of subject merchandise (i.e., PRC-origin innerspring units). sradovich on DSK3GMQ082PROD with NOTICES the Assistant Secretary for Enforcement and Compliance within 30 days of the date of publication of this notice. Requests should contain: (1) The party’s name, address and telephone number; (2) the number of participants; and (3) a list of issues parties intend to discuss. Issues raised in the hearing will be limited to those raised in the respective case and rebuttal briefs. If a request for a hearing is made, the Department intends to hold the hearing at the U.S. Department of Commerce, 1401 Constitution Avenue NW., Washington, DC 20230, at a date and time to be determined.10 Parties should confirm by telephone the date, time, and location of the hearing two days before the scheduled date. Unless extended, the Department intends to issue the final results of this administrative review, which will include the results of our analysis of all issues raised in the case briefs, within 120 days of publication of these preliminary results in the Federal Register, pursuant to section 751(a)(3)(A) of the Act. Notification to Importers Cash Deposit Requirements The following cash deposit requirements will be effective upon publication of the final results of this administrative review for shipments of the subject merchandise from the PRC entered, or withdrawn from warehouse, for consumption on or after the publication date, as provided by section 751(a)(2)(C) of the Act: (1) For Enchant This notice also serves as a preliminary reminder to importers of their responsibility under 19 CFR 351.402(f)(2) to file a certificate regarding the reimbursement of antidumping duties prior to liquidation of the relevant entries during this review period. Failure to comply with this requirement could result in the Department’s presumption that reimbursement of antidumping duties occurred and the subsequent assessment of double antidumping duties. We are issuing and publishing these results in accordance with sections 751(a)(1) and 777(i)(1) of the Act and 19 CFR 351.213. Dated: October 31, 2016. Paul Piquado, Assistant Secretary for Enforcement and Compliance. Appendix List of Topics Discussed in the Preliminary Decision Memorandum 1. Summary 2. Background 3. Scope of the Order 4. Discussion of the Methodology a. Facts Otherwise Available i. Use of Facts Available ii. Use of Adverse Facts Available 5. Recommendation [FR Doc. 2016–26849 Filed 11–4–16; 8:45 am] 10 See 19 CFR 351.310(d). 11 See 19 CFR 351.212(b)(1). VerDate Sep<11>2014 16:02 Nov 04, 2016 BILLING CODE 3510–DS–P Jkt 241001 PO 00000 Frm 00011 Fmt 4703 Sfmt 4703 78117 DEPARTMENT OF COMMERCE International Trade Administration [A–602–807, A–351–842, A–570–022, C–570– 023, A–560–828, C–560–829, A–471–807] Certain Uncoated Paper From Australia, Brazil, the People’s Republic of China, Indonesia, and Portugal: Initiation of Anti-Circumvention Inquiry Enforcement and Compliance, International Trade Administration, Department of Commerce. SUMMARY: In response to a request from the United Steel, Paper and Forestry, Rubber, Manufacturing, Energy, Allied Industrial and Service Workers International Union; Domtar Corporation; Finch Paper LLC; P.H. Glatfelter Company; and Packaging Corporation of America (collectively, the petitioners), the Department of Commerce (the Department) is initiating an anti-circumvention inquiry pursuant to section 781(c) of the Tariff Act of 1930, as amended (the Act), to determine under the minor alterations provision whether uncoated paper with a GE brightness of 83 +/¥ 1% (83 Bright paper) is ‘‘altered in form or appearance in minor respects’’ from in-scope merchandise such that it may be considered subject to the antidumping (AD) and countervailing duty (CVD) orders on certain uncoated paper. DATES: Effective November 7, 2016. FOR FURTHER INFORMATION CONTACT: Ross Belliveau, AD/CVD Operations, Office II, Enforcement and Compliance, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue NW., Washington, DC 20230; telephone: (202) 482–4952. SUPPLEMENTARY INFORMATION: AGENCY: Background On March 3, 2016, the Department issued AD orders on certain uncoated paper from Australia, Brazil, the People’s Republic of China (PRC), Indonesia, and Portugal and CVD orders on certain uncoated paper from the PRC and Indonesia.1 On July 15, 2016, the petitioners alleged that Asia Pulp and Paper (APP), one of the major 1 See Certain Uncoated Paper From Australia, Brazil, Indonesia, the People’s Republic of China, and Portugal: Amended Final Affirmative Antidumping Determinations for Brazil and Indonesia and Antidumping Duty Orders; 81 FR 11174 (March 3, 2016) and Certain Uncoated Paper from Indonesia and the People’s Republic of China: Amended Final Affirmative Countervailing Duty Determination and Countervailing Duty Order (Indonesia) and Countervailing Duty Order (People’s Republic of China); 81 FR 11187, (March 3, 2016) (collectively, the Orders). E:\FR\FM\07NON1.SGM 07NON1 78118 Federal Register / Vol. 81, No. 215 / Monday, November 7, 2016 / Notices Indonesian producers of uncoated paper that is subject to the AD and CVD orders, is engaged in circumvention of the Orders by exporting uncoated paper with a GE brightness level of 83 to the United States.2 The petitioners requested that the Department initiate an anti-circumvention proceeding, pursuant to both sections 781(c) and 781(d) of the Act and 19 CFR 351.225(i)–(j), to determine whether the merchandise at issue involves either a minor alteration to subject merchandise such that it should be subject to the Orders, and/or represents a laterdeveloped product that should be considered subject to the Orders.3 In the alternative, the petitioners requested that the Department initiate a scope inquiry pursuant to 19 CFR 351.225(k) to determine whether 83 Bright paper falls within the scope of the Orders because it is ‘‘colored paper.’’ 4 On August 1, 2016, in response to a request from the Department, the petitioners clarified that, consistent with 19 CFR 351.225(m), the intent of their request was that the Department conduct a single inquiry and issue a single ruling applicable to each of the seven outstanding orders on certain uncoated paper identified in their original request.5 sradovich on DSK3GMQ082PROD with NOTICES Scope of the Orders The merchandise subject to these orders includes uncoated paper in sheet form; weighing at least 40 grams per square meter but not more than 150 grams per square meter; that either is a white paper with a GE brightness level 6 of 85 or higher or is a colored paper; whether or not surface-decorated, 2 See Letter from the petitioners entitled, ‘‘Certain Uncoated Paper From Australia, Brazil, The People’s Republic of China, Indonesia, and Portugal: Petitioners’ Request For Minor Alterations And Later-Developed Merchandise AntiCircumvention Inquiry Or, Alternatively, For A Scope Ruling,’’ dated July 15, 2016 (Initiation Request). As indicated in the ‘‘Scope of the Orders’’ section, below, the GE brightness level specified in the scope of the Orders is 85 or higher. 3 Id., at 2. 4 Id. 5 See Letter from Petitioners entitled ‘‘Certain Uncoated Paper From Australia, Brazil, The People’s Republic Of China, Indonesia, and Portugal: Petitioners’ Correspondence Pursuant To 19 CFR 351.225(m),’’ dated August 1, 2016. 6 One of the key measurements of any grade of paper is brightness. Generally speaking, the brighter the paper the better the contrast between the paper and the ink. Brightness is measured using a GE Reflectance Scale, which measures the reflection of light off a grade of paper. One is the lowest reflection, or what would be given to a totally black grade, and 100 is the brightest measured grade. ‘‘Colored paper’’ as used in this scope definition means a paper with a hue other than white that reflects one of the primary colors of magenta, yellow, and cyan (red, yellow, and blue) or a combination of such primary colors. VerDate Sep<11>2014 16:02 Nov 04, 2016 Jkt 241001 printed (except as described below), embossed, perforated, or punched; irrespective of the smoothness of the surface; and irrespective of dimensions (Certain Uncoated Paper). Certain Uncoated Paper includes (a) uncoated free sheet paper that meets this scope definition; (b) uncoated ground wood paper produced from bleached chemi-thermo-mechanical pulp (BCTMP) that meets this scope definition; and (c) any other uncoated paper that meets this scope definition regardless of the type of pulp used to produce the paper. Specifically excluded from the scope of these orders are (1) paper printed with final content of printed text or graphics and (2) lined paper products, typically school supplies, composed of paper that incorporates straight horizontal and/or vertical lines that would make the paper unsuitable for copying or printing purposes. For purposes of this scope definition, paper shall be considered ‘‘printed with final content’’ where at least one side of the sheet has printed text and/or graphics that cover at least five percent of the surface area of the entire sheet. Imports of the subject merchandise are provided for under Harmonized Tariff Schedule of the United States (HTSUS) categories 4802.56.1000, 4802.56.2000, 4802.56.3000, 4802.56.4000, 4802.56.6000, 4802.56.7020, 4802.56.7040, 4802.57.1000, 4802.57.2000, 4802.57.3000, and 4802.57.4000. Some imports of subject merchandise may also be classified under 4802.62.1000, 4802.62.2000, 4802.62.3000, 4802.62.5000, 4802.62.6020, 4802.62.6040, 4802.69.1000, 4802.69.2000, 4802.69.3000, 4811.90.8050 and 4811.90.9080. While HTSUS subheadings are provided for convenience and customs purposes, the written description of the scope is dispositive. Initiation of Minor Alterations AntiCircumvention Proceeding Statutory Criteria for Initiation of AntiCircumvention Proceeding Under Section 781(c) of the Act Section 781(c)(1) of the Act provides that the Department may find circumvention of an AD and/or CVD order when products which are of the class or kind of merchandise subject to an AD and/or CVD order have been ‘‘altered in form or appearance in minor respects . . . whether or not included in the same tariff classification.’’ Section 781(c)(2) of the Act provides an exception that ‘‘{p}aragraph 1 shall not apply with respect to altered PO 00000 Frm 00012 Fmt 4703 Sfmt 4703 merchandise if the administering authority determines that it would be unnecessary to consider the altered merchandise within the scope of the {AD or CVD} order{.}’’ While the statute is silent as to what factors to consider in determining whether alterations are properly considered ‘‘minor,’’ the legislative history of this provision indicates that there are certain factors which should be considered before reaching a circumvention determination. In conducting a circumvention inquiry under section 781(c) of the Act, the Department has generally relied upon ‘‘such criteria as the overall physical characteristics of the merchandise, the expectations of the ultimate users, the use of the merchandise, the channels of marketing and the cost of any modification relative to the total value of the imported products.’’ 7 Concerning the allegation of minor alteration under section 781(c) of the Act and 19 CFR 351.225(i), the Department examines such factors as: (1) Overall physical characteristics; (2) expectations of ultimate users; (3) use of merchandise; (4) channels of marketing; and (5) cost of any modification relative to the value of the imported products.8 Each case is highly dependent on the facts on the record, and must be analyzed in light of those specific facts. Thus, although not specified in the Act, the Department has also included additional factors in its analysis, such as commercial availability of the product at issue prior to the issuance of the order as well as the circumstances under which the products at issue entered the United States, the timing and quantity of said entries during the circumvention review period, and the input of consumers in the design phase of the product at issue.9 7 See S. Rep. No.71, 100th Cong., 1st Sess. 100 (1987) (‘‘In applying this provision, the Commerce Department should apply practical measurements regarding minor alterations, so that circumvention can be dealt with effectively, even where such alterations to an article technically transform it into a differently designated article.’’). 8 See, e.g., Affirmative Preliminary Determination of Circumvention of the Antidumping Duty Order on Certain Cut-to-Length Steel Plate from the People’s Republic of China, 74 FR 33991, 33992 (July 14, 2009) (CTL Plate from the PRC) (unchanged in Affirmative Final Determination of Circumvention of the Antidumping Duty Order on Certain Cut-to-Length Carbon Steel Plate From the People’s Republic of China; 74 FR 40565 (August 12, 2009)). 9 See, e.g., CTL Plate from the PRC, 74 FR at 33992–33993. E:\FR\FM\07NON1.SGM 07NON1 Federal Register / Vol. 81, No. 215 / Monday, November 7, 2016 / Notices sradovich on DSK3GMQ082PROD with NOTICES The Petitioners’ Request for Initiation of an Anti-Circumvention Proceeding Under Section 781(c) of the Act As discussed above, the petitioners identify the product subject to their request as 83 Bright paper. Specifically, the petitioners state that, after the issuance of the preliminary determinations, APP, one of the major Indonesian producers of uncoated paper, began exporting 81⁄2 inch by 11 inch copier paper with a GE brightness level of 83, called ‘‘Paperline Classic,’’ from Indonesia to the West Coast of the United States. The petitioners obtained and tested a sample of this paper, demonstrating that it has a GE brightness level of 83.10 The petitioners also provided a bill of lading supporting their claim that imports of the 83 Bright paper were classified under HTSUS category 4802.56.4000—a category identified as subject to the Orders.11 According to the petitioners, APP first imported 83 Bright paper in February 2016 and, to date, there have been numerous entries of this product totaling 2,300 metric tons.12 The petitioners argue that APP is adding black dye to the pulp to create a paper product which does not meet the brightness level of uncoated paper covered by the scope of the Orders, but is otherwise subject merchandise. The petitioners assert that, as a result, 83 Bright paper represents a minor alteration of subject merchandise, which is thereby circumventing the Orders pursuant to section 781(c) of the Act. Although the petitioners noted that the Court of Appeals for the Federal Circuit has held that minor alteration inquiries are inappropriate when the allegedly altered product is expressly excluded from an order, they claim that such is not the case here, where 83 Bright paper is not expressly excluded from the order.13 In the Initiation Request, the petitioners presented the following evidence with respect to each of the aforementioned criteria: A. Overall Physical Characteristics The petitioners state that 83 Bright paper is nearly identical to other uncoated paper in the market—it has the same dimensions, the same basis weight, and is advertised for the same printing and copying purposes.14 The petitioners assert that the only 10 See 11 Id., 13 See Initiation Request at 12, citing to Deacero S.A. de C.V. v. United States, 817 F.3d 1332, 1338 (Fed. Cir. 2016) (Deacero). 14 See Initiation Request at 14 and Exhibit 2. Jkt 241001 C. Use of Merchandise The petitioners assert that 83 Bright paper is used in printing and copying applications, similar to other uncoated paper covered by the Orders.19 The petitioners also claim that the brightness of 83 Bright paper has no apparent impact on its ultimate use.20 In support of their allegation, the petitioners provide a declaration from a member of the U.S. industry.21 cash deposit rate.25 In support of their allegation, the petitioners provide a declaration from a member of the U.S. industry.26 APP responded to the petitioners’ allegations, noting that merchandise with a brightness level comparable to 83 Bright paper was produced and sold in commercial volumes at the time of the filing of the petitions and, thus, it cannot be considered later-developed merchandise.27 In addition, APP stated the following regarding each criteria under section 781(c) of the Act: A. Overall Physical Characteristics APP states that there are numerous and significant physical differences between 83 Bright paper and other uncoated paper covered by the Orders in addition to GE brightness, including whiteness, bleaching chemicals, shade, and opacity.28 Further, APP explains that optical brightening agents (OBAs) are often added during production to increase the GE brightness of paper. APP considers it significant that its 83 Bright paper is produced without adding OBAs and, thus, is ‘‘OBAfree.’’ 29 30 B. Expectations of the Ultimate Users D. Channels of Marketing The petitioners assert that the marketing channels for 83 Bright paper and other uncoated paper covered by the Orders are the same.22 The petitioners provided documentation demonstrating that 83 Bright paper is offered to the same customers and in the same manner.23 According to the petitioners, this demonstrates that GE brightness level does not affect the marketing channel in which the paper is sold and that for end-users these products are interchangeable. APP disagrees that the expectations of the ultimate users of 83 Bright paper are the same as users of other uncoated paper covered by the Orders. According to APP, users of 83 Bright paper expect to benefit from reduced eyestrain, cost savings, and appreciate the generally warmer tones of this paper.31 Further, APP notes that certain purchasers of paper covered by the Orders require photocopy paper with a minimum GE brightness of 92 and, thus, 83 Bright paper would not meet the requirements of such purchasers.32 E. Cost of Modification Relative to Total Value The petitioners assert that the cost of the minor alteration necessary to shift the GE brightness level of 83 Bright paper is minimal.24 Moreover, the petitioners state that the increased costs are insignificant both when compared to either the total value of the imported product or APP’s combined AD/CVD C. Use of the Merchandise at 15. at Exhibit 2. 17 Id., at 15 and Exhibit 2. 18 Id., at Exhibit 2. 19 Id., at 3. 20 Id., at 15. 21 Id., at Exhibit 2. 22 See Initiation Request at 15. 23 Id., at 15–16 and Exhibits 10 and 11. 24 Id., at Exhibit 1. 16 Id., 12 Id. 16:02 Nov 04, 2016 B. Expectations of the Ultimate Users The petitioners assert that the expectations of the ultimate users of 83 Bright paper and other uncoated paper covered by the scope of the Orders are exactly the same. Specifically, the petitioners state that 83 Bright paper is advertised for use in the same printing and copying applications as other uncoated paper covered by the scope of the Orders.17 In support of their allegation, the petitioners provide a declaration from a member of the U.S. industry.18 15 Id., Initiation Request at 3. at 5. VerDate Sep<11>2014 difference between 83 Bright paper and paper covered by the scope of the Orders is the paper’s GE brightness level.15 In support of their allegation, the petitioners provide a declaration from a member of the U.S. industry.16 78119 PO 00000 Frm 00013 Fmt 4703 Sfmt 4703 APP states that 83 Bright paper is best for black-and-white copier applications 25 Id., at 17 and Exhibit 2. at Exhibit 1. 27 See Letter from APP entitled, ‘‘Certain Uncoated Paper From Australia, Brazil, The People’s Republic of China, Indonesia, and Portugal—Response to Request for Inquiry’’ dated August 19, 2016 (APP Response), at 10 and Exhibit 3. 28 See APP Response at 24. 29 Id., at Exhibit 7. 30 APP noted that the petitioners incorrectly described the production process for 83 Bright paper. Specifically, APP stated that black dye is not added during the production process and, as a result, 83 Bright paper cannot be considered colored paper. See APP Response at 5 Exhibit 2. 31 See APP Response at 26. 32 Id., at 24–25. 26 Id., E:\FR\FM\07NON1.SGM 07NON1 78120 Federal Register / Vol. 81, No. 215 / Monday, November 7, 2016 / Notices and not suitable for ink- or laser-jet printing.33 D. Channels of Marketing APP claims that 83 Bright paper is marketed differently from other uncoated paper covered by the Orders because it is advertised as a lower brightness product produced to reduce eyestrain, manufactured for 2-sided copying, and is OBA Free.34 E. Cost of Modification Relative to Total Value APP states that 83 Bright paper is not produced with additional OBAs and contains fewer bleaching chemicals. As a result, APP notes that it is less expensive to produce than other uncoated paper cover by the Orders.35 sradovich on DSK3GMQ082PROD with NOTICES Analysis After analyzing the information summarized above, we determine that the petitioners have satisfied the criteria to warrant an initiation of a formal anticircumvention inquiry, pursuant to section 781(c) of the Act and 19 CFR 351.225(i). As described above, the petitioners included declarations from members of the U.S. industry addressing the five factors the Department typically examines as part of a minor alterations inquiry under section 781(c) of the Act and 19 CFR 351.225(i). These declarations attest that: (1) With the exception of brightness, the overall physical characteristics of 83 Bright paper and other uncoated paper cover by the Orders are the same; (2) the expectations of ultimate users of 83 Bright paper and other uncoated paper cover by the Orders are the same; (3) the uses of 83 Bright paper and other uncoated paper cover by the Orders are the same; (4) the channels of marketing 83 Bright paper and other uncoated paper cover by the Orders are the same; and (5) the relative cost to reduce the brightness of 83 Bright paper to a GE brightness level below 85 is minimal.36 We examined the declarations and found that the persons making them are in a position to have knowledge about the facts described in the declarations with respect to each of the aforementioned factors. However, we note that APP provided information demonstrating the relative cost of producing 83 Bright paper and the process by which it is produced which differs from that provided by the petitioners. Specifically, by APP’s own at 27–28. at 29. 35 Id., at 30. 36 See Initiation Request at Exhibits 1 and 2. admission, 83 Bright paper is less expensive to produce because it does not contain the OBAs needed to raise the paper’s brightness level to 85 or above and has fewer bleaching chemical than other uncoated paper covered by the Orders. Thus, there is an evidentiary basis to conclude that APP has altered its production process in order to produce a low-brightness paper.37 As noted above, we are initiating a minor alterations anti-circumvention inquiry pursuant to section 781(c) of the Act regarding 83 Bright paper. We do not find it appropriate to initiate a laterdeveloped merchandise circumvention inquiry pursuant to section 781(d) of the Act because APP provided information demonstrating that merchandise with a brightness level comparable to 83 Bright paper was produced and sold in commercial volumes at the time of the filing of the petitions and, thus, 83 Bright paper cannot be considered laterdeveloped merchandise.38 Finally, we do not find it appropriate to initiate a scope inquiry pursuant to 19 CFR 351.225(k) because APP provided information demonstrating that 83 Bright paper is not colored paper.39 Merchandise Subject to the Minor Alterations Anti-Circumvention Proceeding This minor alterations anticircumvention inquiry covers uncoated paper with a GE brightness level of 83 +/¥ 1. Although only APP Indonesia is discussed in their request, as discussed above, the petitioners clarified that, consistent with 19 CFR 351.225(m), the intent of their request was that the Department conduct a single inquiry and issue a single ruling applicable to each of the Orders. In accordance with 19 CFR 351.225(m), if the Secretary considers it appropriate, the Secretary may conduct a single inquiry and issue a single scope ruling that applies to all such orders. Therefore, we will examine whether it is appropriate to apply the results of this inquiry to each of the seven Orders. The Department will not order the suspension of liquidation of entries of any additional merchandise at this time. However, in accordance with 19 CFR 351.225(l)(2), if the Department issues a preliminary affirmative determination, we will then instruct U.S. Customs and Border Protection to suspend liquidation and require a cash deposit of estimated duties on the merchandise. Following consultation with interested parties, the Department will 33 Id., 34 Id., VerDate Sep<11>2014 16:02 Nov 04, 2016 Jkt 241001 37 Id. 38 See 39 See PO 00000 APP Response at 10 and Exhibit 3. APP Response at 5 and Exhibit 2. Frm 00014 Fmt 4703 Sfmt 4703 establish a schedule for questionnaires and comments on the issues related to each of the Orders. The Department intends to issue its final determinations within 300 days of the date of publication of this initiation. This notice is published in accordance with sections 781(c) of the Act and 19 CFR 351.225(i) and (j). Dated: October 31, 2016. Paul Piquado, Assistant Secretary for Enforcement and Compliance. [FR Doc. 2016–26847 Filed 11–4–16; 8:45 am] BILLING CODE 3510–DS–P DEPARTMENT OF COMMERCE Minority Business Development Agency [Docket No.: 161012956–6956–01] Notice and Request for Comments: Minority Business Development Agency (MBDA) Tribal Consultations Minority Business Development Agency, Department of Commerce. ACTION: Notice. AGENCY: The Minority Business Development Agency (MBDA) plans to conduct five tribal consultation meetings with federally recognized tribes, American Indian and Alaska Native business/trade/economic organizations, and American Indian and Alaska Native-owned firms, between November 2016 and February 2017. The purpose of these tribal consultations is to provide a venue for tribal leaders share insights, make recommendations, and discuss concerns regarding MBDA’s business development and entrepreneurial services in Indian Country. MBDA is also accepting written comments related to the business development issues stated in this notice. DATES: Tribal consultations will be conducted in different locations between November 2016 and February 2017. The specific dates, locations and times will be announced on the MBDA Web site at http://www.mbda.gov/ tribalconsult . Written comments in response to the questions posed in this notice must be submitted no later than January 30, 2017. ADDRESSES: You may submit comments, identified by MBDA–2016–0001, by the following methods: Electronic Submission: Submit all electronic public comments via the Federal eRulemaking Portal. Go to www.regulations.gov/docket?D=MBDASUMMARY: E:\FR\FM\07NON1.SGM 07NON1

Agencies

[Federal Register Volume 81, Number 215 (Monday, November 7, 2016)]
[Notices]
[Pages 78117-78120]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-26847]


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DEPARTMENT OF COMMERCE

International Trade Administration

[A-602-807, A-351-842, A-570-022, C-570-023, A-560-828, C-560-829, A-
471-807]


Certain Uncoated Paper From Australia, Brazil, the People's 
Republic of China, Indonesia, and Portugal: Initiation of Anti-
Circumvention Inquiry

AGENCY: Enforcement and Compliance, International Trade Administration, 
Department of Commerce.

SUMMARY: In response to a request from the United Steel, Paper and 
Forestry, Rubber, Manufacturing, Energy, Allied Industrial and Service 
Workers International Union; Domtar Corporation; Finch Paper LLC; P.H. 
Glatfelter Company; and Packaging Corporation of America (collectively, 
the petitioners), the Department of Commerce (the Department) is 
initiating an anti-circumvention inquiry pursuant to section 781(c) of 
the Tariff Act of 1930, as amended (the Act), to determine under the 
minor alterations provision whether uncoated paper with a GE brightness 
of 83 +/- 1% (83 Bright paper) is ``altered in form or appearance in 
minor respects'' from in-scope merchandise such that it may be 
considered subject to the antidumping (AD) and countervailing duty 
(CVD) orders on certain uncoated paper.

DATES: Effective November 7, 2016.

FOR FURTHER INFORMATION CONTACT: Ross Belliveau, AD/CVD Operations, 
Office II, Enforcement and Compliance, International Trade 
Administration, U.S. Department of Commerce, 14th Street and 
Constitution Avenue NW., Washington, DC 20230; telephone: (202) 482-
4952.

SUPPLEMENTARY INFORMATION: 

Background

    On March 3, 2016, the Department issued AD orders on certain 
uncoated paper from Australia, Brazil, the People's Republic of China 
(PRC), Indonesia, and Portugal and CVD orders on certain uncoated paper 
from the PRC and Indonesia.\1\ On July 15, 2016, the petitioners 
alleged that Asia Pulp and Paper (APP), one of the major

[[Page 78118]]

Indonesian producers of uncoated paper that is subject to the AD and 
CVD orders, is engaged in circumvention of the Orders by exporting 
uncoated paper with a GE brightness level of 83 to the United 
States.\2\ The petitioners requested that the Department initiate an 
anti-circumvention proceeding, pursuant to both sections 781(c) and 
781(d) of the Act and 19 CFR 351.225(i)-(j), to determine whether the 
merchandise at issue involves either a minor alteration to subject 
merchandise such that it should be subject to the Orders, and/or 
represents a later-developed product that should be considered subject 
to the Orders.\3\ In the alternative, the petitioners requested that 
the Department initiate a scope inquiry pursuant to 19 CFR 351.225(k) 
to determine whether 83 Bright paper falls within the scope of the 
Orders because it is ``colored paper.'' \4\ On August 1, 2016, in 
response to a request from the Department, the petitioners clarified 
that, consistent with 19 CFR 351.225(m), the intent of their request 
was that the Department conduct a single inquiry and issue a single 
ruling applicable to each of the seven outstanding orders on certain 
uncoated paper identified in their original request.\5\
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    \1\ See Certain Uncoated Paper From Australia, Brazil, 
Indonesia, the People's Republic of China, and Portugal: Amended 
Final Affirmative Antidumping Determinations for Brazil and 
Indonesia and Antidumping Duty Orders; 81 FR 11174 (March 3, 2016) 
and Certain Uncoated Paper from Indonesia and the People's Republic 
of China: Amended Final Affirmative Countervailing Duty 
Determination and Countervailing Duty Order (Indonesia) and 
Countervailing Duty Order (People's Republic of China); 81 FR 11187, 
(March 3, 2016) (collectively, the Orders).
    \2\ See Letter from the petitioners entitled, ``Certain Uncoated 
Paper From Australia, Brazil, The People's Republic of China, 
Indonesia, and Portugal: Petitioners' Request For Minor Alterations 
And Later-Developed Merchandise Anti-Circumvention Inquiry Or, 
Alternatively, For A Scope Ruling,'' dated July 15, 2016 (Initiation 
Request). As indicated in the ``Scope of the Orders'' section, 
below, the GE brightness level specified in the scope of the Orders 
is 85 or higher.
    \3\ Id., at 2.
    \4\ Id.
    \5\ See Letter from Petitioners entitled ``Certain Uncoated 
Paper From Australia, Brazil, The People's Republic Of China, 
Indonesia, and Portugal: Petitioners' Correspondence Pursuant To 19 
CFR 351.225(m),'' dated August 1, 2016.
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Scope of the Orders

    The merchandise subject to these orders includes uncoated paper in 
sheet form; weighing at least 40 grams per square meter but not more 
than 150 grams per square meter; that either is a white paper with a GE 
brightness level \6\ of 85 or higher or is a colored paper; whether or 
not surface-decorated, printed (except as described below), embossed, 
perforated, or punched; irrespective of the smoothness of the surface; 
and irrespective of dimensions (Certain Uncoated Paper).
---------------------------------------------------------------------------

    \6\ One of the key measurements of any grade of paper is 
brightness. Generally speaking, the brighter the paper the better 
the contrast between the paper and the ink. Brightness is measured 
using a GE Reflectance Scale, which measures the reflection of light 
off a grade of paper. One is the lowest reflection, or what would be 
given to a totally black grade, and 100 is the brightest measured 
grade. ``Colored paper'' as used in this scope definition means a 
paper with a hue other than white that reflects one of the primary 
colors of magenta, yellow, and cyan (red, yellow, and blue) or a 
combination of such primary colors.
---------------------------------------------------------------------------

    Certain Uncoated Paper includes (a) uncoated free sheet paper that 
meets this scope definition; (b) uncoated ground wood paper produced 
from bleached chemi-thermo-mechanical pulp (BCTMP) that meets this 
scope definition; and (c) any other uncoated paper that meets this 
scope definition regardless of the type of pulp used to produce the 
paper.
    Specifically excluded from the scope of these orders are (1) paper 
printed with final content of printed text or graphics and (2) lined 
paper products, typically school supplies, composed of paper that 
incorporates straight horizontal and/or vertical lines that would make 
the paper unsuitable for copying or printing purposes. For purposes of 
this scope definition, paper shall be considered ``printed with final 
content'' where at least one side of the sheet has printed text and/or 
graphics that cover at least five percent of the surface area of the 
entire sheet.
    Imports of the subject merchandise are provided for under 
Harmonized Tariff Schedule of the United States (HTSUS) categories 
4802.56.1000, 4802.56.2000, 4802.56.3000, 4802.56.4000, 4802.56.6000, 
4802.56.7020, 4802.56.7040, 4802.57.1000, 4802.57.2000, 4802.57.3000, 
and 4802.57.4000. Some imports of subject merchandise may also be 
classified under 4802.62.1000, 4802.62.2000, 4802.62.3000, 
4802.62.5000, 4802.62.6020, 4802.62.6040, 4802.69.1000, 4802.69.2000, 
4802.69.3000, 4811.90.8050 and 4811.90.9080. While HTSUS subheadings 
are provided for convenience and customs purposes, the written 
description of the scope is dispositive.

Initiation of Minor Alterations Anti-Circumvention Proceeding

Statutory Criteria for Initiation of Anti-Circumvention Proceeding 
Under Section 781(c) of the Act

    Section 781(c)(1) of the Act provides that the Department may find 
circumvention of an AD and/or CVD order when products which are of the 
class or kind of merchandise subject to an AD and/or CVD order have 
been ``altered in form or appearance in minor respects . . . whether or 
not included in the same tariff classification.'' Section 781(c)(2) of 
the Act provides an exception that ``{p{time} aragraph 1 shall not 
apply with respect to altered merchandise if the administering 
authority determines that it would be unnecessary to consider the 
altered merchandise within the scope of the {AD or CVD{time}  
order{.{time} ''
    While the statute is silent as to what factors to consider in 
determining whether alterations are properly considered ``minor,'' the 
legislative history of this provision indicates that there are certain 
factors which should be considered before reaching a circumvention 
determination. In conducting a circumvention inquiry under section 
781(c) of the Act, the Department has generally relied upon ``such 
criteria as the overall physical characteristics of the merchandise, 
the expectations of the ultimate users, the use of the merchandise, the 
channels of marketing and the cost of any modification relative to the 
total value of the imported products.'' \7\ Concerning the allegation 
of minor alteration under section 781(c) of the Act and 19 CFR 
351.225(i), the Department examines such factors as: (1) Overall 
physical characteristics; (2) expectations of ultimate users; (3) use 
of merchandise; (4) channels of marketing; and (5) cost of any 
modification relative to the value of the imported products.\8\ Each 
case is highly dependent on the facts on the record, and must be 
analyzed in light of those specific facts. Thus, although not specified 
in the Act, the Department has also included additional factors in its 
analysis, such as commercial availability of the product at issue prior 
to the issuance of the order as well as the circumstances under which 
the products at issue entered the United States, the timing and 
quantity of said entries during the circumvention review period, and 
the input of consumers in the design phase of the product at issue.\9\
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    \7\ See S. Rep. No.71, 100th Cong., 1st Sess. 100 (1987) (``In 
applying this provision, the Commerce Department should apply 
practical measurements regarding minor alterations, so that 
circumvention can be dealt with effectively, even where such 
alterations to an article technically transform it into a 
differently designated article.'').
    \8\ See, e.g., Affirmative Preliminary Determination of 
Circumvention of the Antidumping Duty Order on Certain Cut-to-Length 
Steel Plate from the People's Republic of China, 74 FR 33991, 33992 
(July 14, 2009) (CTL Plate from the PRC) (unchanged in Affirmative 
Final Determination of Circumvention of the Antidumping Duty Order 
on Certain Cut-to-Length Carbon Steel Plate From the People's 
Republic of China; 74 FR 40565 (August 12, 2009)).
    \9\ See, e.g., CTL Plate from the PRC, 74 FR at 33992-33993.

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[[Page 78119]]

The Petitioners' Request for Initiation of an Anti-Circumvention 
Proceeding Under Section 781(c) of the Act

    As discussed above, the petitioners identify the product subject to 
their request as 83 Bright paper. Specifically, the petitioners state 
that, after the issuance of the preliminary determinations, APP, one of 
the major Indonesian producers of uncoated paper, began exporting 8\1/
2\ inch by 11 inch copier paper with a GE brightness level of 83, 
called ``Paperline Classic,'' from Indonesia to the West Coast of the 
United States. The petitioners obtained and tested a sample of this 
paper, demonstrating that it has a GE brightness level of 83.\10\
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    \10\ See Initiation Request at 3.
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    The petitioners also provided a bill of lading supporting their 
claim that imports of the 83 Bright paper were classified under HTSUS 
category 4802.56.4000--a category identified as subject to the 
Orders.\11\ According to the petitioners, APP first imported 83 Bright 
paper in February 2016 and, to date, there have been numerous entries 
of this product totaling 2,300 metric tons.\12\ The petitioners argue 
that APP is adding black dye to the pulp to create a paper product 
which does not meet the brightness level of uncoated paper covered by 
the scope of the Orders, but is otherwise subject merchandise. The 
petitioners assert that, as a result, 83 Bright paper represents a 
minor alteration of subject merchandise, which is thereby circumventing 
the Orders pursuant to section 781(c) of the Act. Although the 
petitioners noted that the Court of Appeals for the Federal Circuit has 
held that minor alteration inquiries are inappropriate when the 
allegedly altered product is expressly excluded from an order, they 
claim that such is not the case here, where 83 Bright paper is not 
expressly excluded from the order.\13\
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    \11\ Id., at 5.
    \12\ Id.
    \13\ See Initiation Request at 12, citing to Deacero S.A. de 
C.V. v. United States, 817 F.3d 1332, 1338 (Fed. Cir. 2016) 
(Deacero).
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    In the Initiation Request, the petitioners presented the following 
evidence with respect to each of the aforementioned criteria:
A. Overall Physical Characteristics
    The petitioners state that 83 Bright paper is nearly identical to 
other uncoated paper in the market--it has the same dimensions, the 
same basis weight, and is advertised for the same printing and copying 
purposes.\14\ The petitioners assert that the only difference between 
83 Bright paper and paper covered by the scope of the Orders is the 
paper's GE brightness level.\15\ In support of their allegation, the 
petitioners provide a declaration from a member of the U.S. 
industry.\16\
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    \14\ See Initiation Request at 14 and Exhibit 2.
    \15\ Id., at 15.
    \16\ Id., at Exhibit 2.
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B. Expectations of the Ultimate Users
    The petitioners assert that the expectations of the ultimate users 
of 83 Bright paper and other uncoated paper covered by the scope of the 
Orders are exactly the same. Specifically, the petitioners state that 
83 Bright paper is advertised for use in the same printing and copying 
applications as other uncoated paper covered by the scope of the 
Orders.\17\ In support of their allegation, the petitioners provide a 
declaration from a member of the U.S. industry.\18\
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    \17\ Id., at 15 and Exhibit 2.
    \18\ Id., at Exhibit 2.
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C. Use of Merchandise
    The petitioners assert that 83 Bright paper is used in printing and 
copying applications, similar to other uncoated paper covered by the 
Orders.\19\ The petitioners also claim that the brightness of 83 Bright 
paper has no apparent impact on its ultimate use.\20\ In support of 
their allegation, the petitioners provide a declaration from a member 
of the U.S. industry.\21\
---------------------------------------------------------------------------

    \19\ Id., at 3.
    \20\ Id., at 15.
    \21\ Id., at Exhibit 2.
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D. Channels of Marketing
    The petitioners assert that the marketing channels for 83 Bright 
paper and other uncoated paper covered by the Orders are the same.\22\ 
The petitioners provided documentation demonstrating that 83 Bright 
paper is offered to the same customers and in the same manner.\23\ 
According to the petitioners, this demonstrates that GE brightness 
level does not affect the marketing channel in which the paper is sold 
and that for end-users these products are interchangeable.
---------------------------------------------------------------------------

    \22\ See Initiation Request at 15.
    \23\ Id., at 15-16 and Exhibits 10 and 11.
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E. Cost of Modification Relative to Total Value
    The petitioners assert that the cost of the minor alteration 
necessary to shift the GE brightness level of 83 Bright paper is 
minimal.\24\ Moreover, the petitioners state that the increased costs 
are insignificant both when compared to either the total value of the 
imported product or APP's combined AD/CVD cash deposit rate.\25\ In 
support of their allegation, the petitioners provide a declaration from 
a member of the U.S. industry.\26\
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    \24\ Id., at Exhibit 1.
    \25\ Id., at 17 and Exhibit 2.
    \26\ Id., at Exhibit 1.
---------------------------------------------------------------------------

    APP responded to the petitioners' allegations, noting that 
merchandise with a brightness level comparable to 83 Bright paper was 
produced and sold in commercial volumes at the time of the filing of 
the petitions and, thus, it cannot be considered later-developed 
merchandise.\27\ In addition, APP stated the following regarding each 
criteria under section 781(c) of the Act:
---------------------------------------------------------------------------

    \27\ See Letter from APP entitled, ``Certain Uncoated Paper From 
Australia, Brazil, The People's Republic of China, Indonesia, and 
Portugal--Response to Request for Inquiry'' dated August 19, 2016 
(APP Response), at 10 and Exhibit 3.
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A. Overall Physical Characteristics
    APP states that there are numerous and significant physical 
differences between 83 Bright paper and other uncoated paper covered by 
the Orders in addition to GE brightness, including whiteness, bleaching 
chemicals, shade, and opacity.\28\ Further, APP explains that optical 
brightening agents (OBAs) are often added during production to increase 
the GE brightness of paper. APP considers it significant that its 83 
Bright paper is produced without adding OBAs and, thus, is ``OBA-
free.'' 29 30
---------------------------------------------------------------------------

    \28\ See APP Response at 24.
    \29\ Id., at Exhibit 7.
    \30\ APP noted that the petitioners incorrectly described the 
production process for 83 Bright paper. Specifically, APP stated 
that black dye is not added during the production process and, as a 
result, 83 Bright paper cannot be considered colored paper. See APP 
Response at 5 Exhibit 2.
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B. Expectations of the Ultimate Users
    APP disagrees that the expectations of the ultimate users of 83 
Bright paper are the same as users of other uncoated paper covered by 
the Orders. According to APP, users of 83 Bright paper expect to 
benefit from reduced eyestrain, cost savings, and appreciate the 
generally warmer tones of this paper.\31\ Further, APP notes that 
certain purchasers of paper covered by the Orders require photocopy 
paper with a minimum GE brightness of 92 and, thus, 83 Bright paper 
would not meet the requirements of such purchasers.\32\
---------------------------------------------------------------------------

    \31\ See APP Response at 26.
    \32\ Id., at 24-25.
---------------------------------------------------------------------------

C. Use of the Merchandise
    APP states that 83 Bright paper is best for black-and-white copier 
applications

[[Page 78120]]

and not suitable for ink- or laser-jet printing.\33\
---------------------------------------------------------------------------

    \33\ Id., at 27-28.
---------------------------------------------------------------------------

D. Channels of Marketing
    APP claims that 83 Bright paper is marketed differently from other 
uncoated paper covered by the Orders because it is advertised as a 
lower brightness product produced to reduce eyestrain, manufactured for 
2-sided copying, and is OBA Free.\34\
---------------------------------------------------------------------------

    \34\ Id., at 29.
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E. Cost of Modification Relative to Total Value
    APP states that 83 Bright paper is not produced with additional 
OBAs and contains fewer bleaching chemicals. As a result, APP notes 
that it is less expensive to produce than other uncoated paper cover by 
the Orders.\35\
---------------------------------------------------------------------------

    \35\ Id., at 30.
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Analysis

    After analyzing the information summarized above, we determine that 
the petitioners have satisfied the criteria to warrant an initiation of 
a formal anti-circumvention inquiry, pursuant to section 781(c) of the 
Act and 19 CFR 351.225(i).
    As described above, the petitioners included declarations from 
members of the U.S. industry addressing the five factors the Department 
typically examines as part of a minor alterations inquiry under section 
781(c) of the Act and 19 CFR 351.225(i). These declarations attest 
that: (1) With the exception of brightness, the overall physical 
characteristics of 83 Bright paper and other uncoated paper cover by 
the Orders are the same; (2) the expectations of ultimate users of 83 
Bright paper and other uncoated paper cover by the Orders are the same; 
(3) the uses of 83 Bright paper and other uncoated paper cover by the 
Orders are the same; (4) the channels of marketing 83 Bright paper and 
other uncoated paper cover by the Orders are the same; and (5) the 
relative cost to reduce the brightness of 83 Bright paper to a GE 
brightness level below 85 is minimal.\36\ We examined the declarations 
and found that the persons making them are in a position to have 
knowledge about the facts described in the declarations with respect to 
each of the aforementioned factors.
---------------------------------------------------------------------------

    \36\ See Initiation Request at Exhibits 1 and 2.
---------------------------------------------------------------------------

    However, we note that APP provided information demonstrating the 
relative cost of producing 83 Bright paper and the process by which it 
is produced which differs from that provided by the petitioners. 
Specifically, by APP's own admission, 83 Bright paper is less expensive 
to produce because it does not contain the OBAs needed to raise the 
paper's brightness level to 85 or above and has fewer bleaching 
chemical than other uncoated paper covered by the Orders. Thus, there 
is an evidentiary basis to conclude that APP has altered its production 
process in order to produce a low-brightness paper.\37\
---------------------------------------------------------------------------

    \37\ Id.
---------------------------------------------------------------------------

    As noted above, we are initiating a minor alterations anti-
circumvention inquiry pursuant to section 781(c) of the Act regarding 
83 Bright paper. We do not find it appropriate to initiate a later-
developed merchandise circumvention inquiry pursuant to section 781(d) 
of the Act because APP provided information demonstrating that 
merchandise with a brightness level comparable to 83 Bright paper was 
produced and sold in commercial volumes at the time of the filing of 
the petitions and, thus, 83 Bright paper cannot be considered later-
developed merchandise.\38\ Finally, we do not find it appropriate to 
initiate a scope inquiry pursuant to 19 CFR 351.225(k) because APP 
provided information demonstrating that 83 Bright paper is not colored 
paper.\39\
---------------------------------------------------------------------------

    \38\ See APP Response at 10 and Exhibit 3.
    \39\ See APP Response at 5 and Exhibit 2.
---------------------------------------------------------------------------

Merchandise Subject to the Minor Alterations Anti-Circumvention 
Proceeding

    This minor alterations anti-circumvention inquiry covers uncoated 
paper with a GE brightness level of 83 +/- 1. Although only APP 
Indonesia is discussed in their request, as discussed above, the 
petitioners clarified that, consistent with 19 CFR 351.225(m), the 
intent of their request was that the Department conduct a single 
inquiry and issue a single ruling applicable to each of the Orders. In 
accordance with 19 CFR 351.225(m), if the Secretary considers it 
appropriate, the Secretary may conduct a single inquiry and issue a 
single scope ruling that applies to all such orders. Therefore, we will 
examine whether it is appropriate to apply the results of this inquiry 
to each of the seven Orders.
     The Department will not order the suspension of liquidation of 
entries of any additional merchandise at this time. However, in 
accordance with 19 CFR 351.225(l)(2), if the Department issues a 
preliminary affirmative determination, we will then instruct U.S. 
Customs and Border Protection to suspend liquidation and require a cash 
deposit of estimated duties on the merchandise.
    Following consultation with interested parties, the Department will 
establish a schedule for questionnaires and comments on the issues 
related to each of the Orders. The Department intends to issue its 
final determinations within 300 days of the date of publication of this 
initiation.
    This notice is published in accordance with sections 781(c) of the 
Act and 19 CFR 351.225(i) and (j).

    Dated: October 31, 2016.
Paul Piquado,
Assistant Secretary for Enforcement and Compliance.
[FR Doc. 2016-26847 Filed 11-4-16; 8:45 am]
 BILLING CODE 3510-DS-P