10774 Federal Register / Vol. 75, No. 45 / Tuesday, March 9, 2010 / Notices 

protective order, without the written 

consent of the Assistant Secretary for 

Import Administration. In accordance 

with section 705(b)(2)(B) of the Act, if 

our final determination is affirmative, 

the ITC will make its final 

determination within 45 days after the 

Department makes its final 

determination. 

Disclosure and Public Comment 

In accordance with 19 CFR 

351.224(b), we will disclose to the 

parties the calculations for this 

preliminary determination within five 

days of its announcement. Unless 

otherwise notified by the Department, 

case briefs for this investigation must be 

submitted no later than 50 days after the 

date of publication of the preliminary 

determination. See 19 CFR 351.309(c) 

(for a further discussion of case briefs). 

Rebuttal briefs must be filed within five 

days after the deadline for submission of 

case briefs, pursuant to 19 CFR 

351.309(d)(1). A list of authorities relied 

upon, a table of contents, and an 

executive summary of issues should 

accompany any briefs submitted to the 

Department. Executive summaries 

should be limited to five pages total, 

including footnotes. Section 774 of the 

Act provides that the Department will 

hold a public hearing to afford 

interested parties an opportunity to 

comment on arguments raised in case or 

rebuttal briefs, provided that such a 

hearing is requested by an interested 

party. If a request for a hearing is made 

in this investigation, the hearing will 

tentatively be held two days after the 

deadline for submission of the rebuttal 

briefs, pursuant to 19 CFR 351.310(d). 

Any such hearing will be held at the 

U.S. Department of Commerce, 14th 

Street and Constitution Avenue, NW, 

Washington, DC 20230. Parties should 

confirm, by telephone, the date, time, 

and place of the hearing 48 hours before 

the scheduled time. 

Interested parties who wish to request 

a hearing, or to participate if one is 

requested, must submit a written 

request to the Assistant Secretary for 

Import Administration, U.S. Department 

of Commerce, Room 1870, within 30 

days of the publication of this notice, 

pursuant to 19 CFR 351.310(c). Requests 

should contain: (1) the party’s name, 

address, and telephone number; (2) the 

number of participants; and (3) a list of 

the issues to be discussed. Oral 

presentations will be limited to issues 

raised in the briefs. 

This determination is issued and 

published pursuant to sections 703(f) 

and 777(i) of the Act and 19 CFR 

351.221(b)(4). 

Dated: March 1, 2010. 

Carole A. Showers, 

Acting Deputy Assistant Secretary for Import 

Administration. 

[FR Doc. 2010–4986 Filed 3–8–10; 8:45 am] 

BILLING CODE 3510–DS–S 

DEPARTMENT OF COMMERCE 

International Trade Administration 

(C–570–959) 

Certain Coated Paper Suitable For 

High–Quality Print Graphics Using 

Sheet–Fed Presses from the People’s 

Republic of China: Preliminary 

Affirmative Countervailing Duty 

Determination and Alignment of Final 

Countervailing Duty Determination 

with Final Antidumping Duty 

Determination 

AGENCY: Import Administration, 

International Trade Administration, 

Department of Commerce. 

SUMMARY: The Department of Commerce 

preliminarily determines that 

countervailable subsidies are being 

provided to producers and exporters of 

certain coated paper suitable for high– 

quality print graphics using sheet–fed 

presses from the People’s Republic of 

China (‘‘PRC’’). For information on the 

estimated subsidy rates, see the 

‘‘Suspension of Liquidation’’ section of 

this notice. 

EFFECTIVE DATE: March 9, 2010. 

FOR FURTHER INFORMATION CONTACT: 

David Neubacher, Jennifer Meek, Mary 

Kolberg, 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) 482–5823, 

(202) 482–2778, (202) 482–1785, 

respectively. 

SUPPLEMENTARY INFORMATION: 

Case History 

The following events have occurred 

since the publication of the Department 

of Commerce’s (‘‘Department’’) notice of 

initiation in the Federal Register. See 

Certain Coated Paper Suitable For High– 

Quality Print Graphics Using Sheet–Fed 

Presses from the People’s Republic of 

China: Initiation of Countervailing Duty 

Investigation, 74 FR 53703 (October 20, 

2009) (‘‘Initiation Notice’’), and the 

accompanying Initiation Checklist. 

On November 16, 2009, the 

Department selected two Chinese 

producers/exporters of certain coated 

paper suitable for high–quality print 

graphics using sheet–fed presses 

(‘‘coated paper’’) as mandatory 

respondents: 1) Gold East Trading (Hong 

Kong) Company Limited (‘‘GEHK’’), Gold 

East Paper (Jiangsu) Co., Ltd. (‘‘GEP’’) 

and Gold Huasheng Paper Co., Ltd. 

(‘‘GHS’’) (collectively, ‘‘Gold companies’’) 

and 2) Shandong Sun Paper Industry 

Joint Stock Co., Ltd. (‘‘Sun Paper’’) and 

its affiliate Yanzhou Tianzhang Paper 

Industry Co., Ltd. (‘‘Yanzhou 

Tianzhang’’) (collectively, ‘‘Sun Paper 

companies’’). See Memorandum to John 

M. Andersen, Acting Deputy Assistant 

Secretary for Antidumping and 

Countervailing Duty Operations 

(November 16, 2009). A public version 

of this memorandum is on file in the 

Department’s Central Records Unit in 

Room 1117 of the main Department 

building (‘‘CRU’’). 

On November 17, 2009, we issued 

questionnaires to the Government of the 

PRC (‘‘GOC’’), Gold companies and Sun 

Paper companies. On December 8, 2009, 

the Department postponed the deadline 

for the preliminary determination in 

this investigation until February 22, 

2009. See Certain Coated Paper Suitable 

for High–Quality Print Graphics Using 

Sheet–Fed Presses from the People’s 

Republic of China: Postponement of 

Preliminary Determination in the 

Countervailing Duty Investigation, 74 FR 

64669 (December 8, 2009). 

We received responses to our 

questionnaire from the GOC, Gold 

companies and Sun Paper companies on 

January 7 and 8, 2010. See the GOC’s 

Original Questionnaire Response 

(January 7, 2010) (‘‘GQR’’), Gold 

companies’ Original Questionnaire 

Response (January 7, 2010) (‘‘GEQR’’), 

Sun Paper’s Original Questionnaire 

Response (January 7, 2010) (‘‘SPQR’’), 

and Yanzhou Tianzhang’s Original 

Questionnaire Response (January 7, and 

8, 2010) (‘‘YTQR’’). 

We sent supplemental questionnaires 

to the Gold companies, Sun Paper 

companies and the GOC on February 4, 

2010. We received responses to these 

supplemental questionnaires on 

February 12, 2010. See GOC’s First 

Supplemental Questionnaire Response 

(February 12, 2010) (‘‘G1SQR’’), Sun 

Paper companies’ First Supplemental 

Questionnaire Response (February 12, 

2010) (‘‘SP1SQR’’), and Gold companies’ 

First Supplemental Questionnaire 

Response (February 12, 2010). 

On January 7, 2010, Appleton Coated 

LLC, NewPage Corporation, S.D.Warren 

Company d/b/a Sappi Fine Paper North 

America, and United Steel, Paper and 

Forestry, Rubber, Manufacturing, 

Energy, Allied Industrial and Service 

Workers International Union 

(collectively, ‘‘Petitioners’’) requested 

that the Department extend the deadline 

for the submission of new subsidy 


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1See Coated Free Sheet Paper from the People’s 

Republic of China: Final Affirmative Countervailing 

Duty Determination, 72 FR 60645 (October 25, 

2007) (‘‘CFS from the PRC’’), and the accompanying 

Issues and Decision Memorandum (‘‘CFS Decision 

Memorandum’’) at p. 8. 

allegations beyond the January 13, 2010, 

deadline established by the 

Department’s regulations. On January 8, 

2010, we extended the deadline. On 

January 13 and 14, 2010, Petitioners 

submitted two sets of new subsidy 

allegations. The Department is still 

reviewing these allegations. 

On January 19, 2010, Petitioners 

submitted an allegation that the Asia 

Pulp and Paper companies (referred to 

herein as the Gold companies), 

including GEP, should be considered 

uncreditworthy for the period 2003 - 

2008. Petitioners requested the 

Department to reaffirm its prior 

determination with regard to the 

uncreditworthiness of the Gold 

companies for the period 2003–20051

and initiate an investigation into the 

creditworthiness of the Gold companies 

during the period 2006–2008. 

Petitioners have submitted financial 

ratios for certain Gold companies and 

have pointed to other evidence on the 

record to argue that these companies 

were uncreditworthy for the period 

2006 – 2008. See ‘‘Creditworthiness’’ 

section below. 

On January 20, 2010, we issued a 

letter requesting that the GOC update its 

original questionnaire response for the 

cross–owned affiliates for which the 

Gold companies filed questionnaire 

responses. The GOC filed its response 

on February 12, 2010. See GOC’s 

Supplemental Response (February 12, 

2010) (‘‘GSR’’). 

On January 21, 2010, we issued a 

letter notifying the GOC that it did not 

provide responses to certain questions 

in the original questionnaire. In 

response to this letter, on February 12, 

and 25, 2010, the GOC filed information 

pertaining to the Chinese banking sector 

and provision of chemicals. See GOC’s 

Additional Supplemental Response 

(February 25, 2010) (‘‘G2SR’’). 

On February 16, 18, 19, 23 and 25, 

2010, Petitioners submitted comments 

for the preliminary determination. The 

Gold companies submitted comments 

for the preliminary determination on 

February 24, 2010. 

The Department originally extended 

the deadline for this preliminary 

determination until February 22, 2010. 

As explained in the memorandum from 

the Deputy Assistant Secretary for 

Import Administration, the Department 

has exercised its discretion to toll 

deadlines for the duration of the closure 

of the Federal Government from 

February 5, through February 12, 2010. 

Thus, all deadlines in this segment of 

the proceeding have been extended by 

seven days. The revised deadline for the 

preliminary determination of this 

investigation is now March 1, 2010. See 

Memorandum to the Record from 

Ronald Lorentzen, DAS for Import 

Administration, regarding ‘‘Tolling of 

Administrative Deadlines As a Result of 

the Government Closure During the 

Recent Snowstorm,’’ dated February 12, 

2010. 

Scope Comments 

In accordance with the preamble to 

the Department’s regulations, we set 

aside a period of time in our Initiation 

Notice for parties to raise issues 

regarding product coverage, and 

encouraged all parties to submit 

comments within 20 calendar days of 

publication of that notice. See 

Antidumping Duties; Countervailing 

Duties, 62 FR 27296, 27323 (May 19, 

1997), and Initiation Notice, 74 FR at 

53703. We received comments 

concerning the scope of the 

antidumping duty (‘‘AD’’) and 

countervailing duty (‘‘CVD’’) 

investigations of coated paper from the 

PRC. 

Timely comments were filed 

collectively by the GEP, GHS, PT Pindo 

Deli Pulp and Paper Mills, and PT 

Pabrik Kertas Tjimi Kimia Tbk. 

(collectively, ‘‘Scope Respondents’’) on 

November 6, 2009. These parties asked 

the Department to clarify the scope of 

these investigations by inserting 

language stating that multi–ply coated 

paperboard is not covered. According to 

Scope Respondents, multi–ply coated 

paperboard is not the same as subject 

coated paper and paperboard. First, 

Scope Respondents claim its end–use is 

not for graphic printing purposes or as 

a cover for graphic applications as 

stated in the petition, but primarily for 

packaging functions (e.g., cosmetics, 

cigarettes, etc.). Moreover, the physical 

characteristics of this product and its 

production process differ from those of 

subject coated paper. In addition, Scope 

Respondents note the Harmonized Tariff 

Schedule (‘‘HTS’’) number for multi–ply 

coated paper products was not included 

in the scope by Petitioners and, thus, it 

was not their intention to consider this 

product subject to the order. Finally, 

Scope Respondents claim that including 

multi–ply coated paperboard would call 

into question the Department’s industry 

standing analysis. 

In response to Scope Respondents’ 

submission, Petitioners submitted 

comments on November 16, 2009. 

Petitioners assert the scope provides 

clear, specific criteria (e.g., sheets, 

suitable for high quality print graphics, 

using sheet–fed press, coated, 80 or 

higher GE brightness level, weight no 

more than 340 gsm, etc.) for determining 

covered merchandise. Petitioners also 

point out that neither the petitions nor 

the initiation documents indicate that 

plies are a relevant physical 

characteristic. Furthermore, that multi– 

ply products produced by Scope 

Respondents are suitable for more than 

a single use. Thus, if the coated paper 

product, including multi–ply coated 

paperboard, meets the criteria stated in 

the scope, the product is subject to these 

investigations and the arguments 

provided by Scope Respondents (e.g., 

characteristics, production process, HTS 

numbers, etc.) are immaterial. Finally, 

Petitioners claim that there is no reason 

to re–examine the analysis conducted at 

the initiation phase of the investigation 

regarding Petitioners’ standing. 

On December 16, 2009, Scope 

Respondents requested that the 

Department revisit its determination 

regarding industry support. While 

acknowledging that the deadline had 

passed, Scope Respondents claimed that 

neither the statute nor the Department’s 

regulations preclude it from extending 

the deadline and revisiting its industry 

support determination. 

On December 28, 2009, Petitioners 

responded that the statute and 

Statement of Administrative Action are 

clear that an industry support 

determination cannot be reconsidered in 

the context of the investigation. On 

February 19, 2010, representatives of 

Scope Respondents met with 

Department officials to discuss their 

scope comments. See Memorandum to 

the File from Nancy Decker, regarding 

‘‘Ex–Parte Meeting with Counsel to 

Respondents’’ (March 1, 2010). On 

February 23, 2010, Scope Respondents 

filed documents and photographs of 

items presented to the Department at 

this ex parte meeting. On February 22, 

2010, representatives of Petitioners met 

with Department officials to discuss 

their scope comments. See 

Memorandum to the File from Nancy 

Decker, regarding ‘‘Ex–Parte Meeting 

with Counsel to Petitioners’’ (March 1, 

2010). On February 23, 2010, Petitioners 

filed a submission in which they 

included a calculation presented to the 

Department during this ex parte 

meeting. 

On February 25, 2010, Petitioners 

filed additional comments rebutting the 

documents filed by Scope Respondents 

and restating their prior claims. In 

response to a question the Department 

posed during the ex parte meeting, 

Petitioners stated that the phrase 

‘‘suitable for high quality print graphics’’ 


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2 ‘‘ ‘Paperboard’ refers to Coated Paper that is 

heavier, thicker and more rigid than coated paper 

which otherwise meets the product description. In 

the context of Coated Paper, paperboard typically 

is referred to as ‘cover,’ to distinguish it from 

‘text.’ ’’ 

3One 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 of 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. 

4As noted supra in the Scope Comments section, 

we have determined that the word ‘‘paperboard’’ 

was inadvertently left out of the sentence in the 

Initiation Notice and have corrected it for the 

preliminary determination. 

could be stricken from the description 

of the subject merchandise without 

altering the scope of these 

investigations. 

Based on our review of the scope, we 

agree with Petitioners that the number 

of plies is not among the specific 

physical characteristics (e.g., brightness, 

coated, weight, etc.) defining the subject 

merchandise. Accordingly, we 

preliminarily find that multi–ply coated 

paper is covered by the scope of these 

investigations, to the extent that it meets 

the description of the merchandise in 

the scope. 

Given that Petitioners’ most recent 

submission regarding the suitability 

language was received shortly before 

these preliminary determinations, we 

have not had sufficient time to analyze 

this issue. Accordingly, we have not 

amended the scope and we invite 

parties to further comment with respect 

to whether the phrase ‘‘suitable for high 

quality print graphics’’ can be stricken 

from the description of the subject 

merchandise without altering the scope 

of these investigations. These scope 

comments must be filed within 20 

calendar days of publication of this 

notice, and they must be filed on the 

record of this investigation, as well as 

the records of the concurrent AD 

investigations on coated paper from 

Indonesia and the PRC and the CVD 

investigation of coated paper from 

Indonesia. 

In their February 25, 2010 

submission, Petitioners also stated that 

the phrase in the scope, ‘‘(c) any other 

coated paper that meets the scope 

definition’’ should also include the word 

‘‘paperboard.’’ We agree that the word 

‘‘paperboard’’ was inadvertently omitted 

(e.g., it is already explicitly included in 

the first sentence of the scope language 

and in ‘‘(b)’’ of the second paragraph) 

and have corrected the scope language 

to read ‘‘(c) any other coated paper and 

paperboard that meets this scope 

definition.’’ 

Scope of the Investigation 

The scope of this investigation 

consists of Coated Paper, which are 

certain coated paper and paperboard2 in 

sheets suitable for high quality print 

graphics using sheet–fed presses; coated 

on one or both sides with kaolin (China 

or other clay), calcium carbonate, 

titanium dioxide, and/or other inorganic 

substances; with or without a binder; 

having a GE brightness level of 80 or 

higher;3 weighing not more than 340 

grams per square meter; whether gloss 

grade, satin grade, matte grade, dull 

grade, or any other grade of finish; 

whether or not surface–colored, 

surface–decorated, printed (except as 

described below), embossed, or 

perforated; and irrespective of 

dimensions. 

Coated Paper includes: (a) coated free 

sheet paper and paperboard that meets 

this scope definition; (b) coated 

groundwood paper and paperboard 

produced from bleached chemi–thermomechanical pulp (‘‘BCTMP’’) that meets 

this scope definition; and (c) any other 

coated paper and paperboard that meets 

this scope definition.4

Coated Paper is typically (but not 

exclusively) used for printing multi– 

colored graphics for catalogues, books, 

magazines, envelopes, labels and wraps, 

greeting cards, and other commercial 

printing applications requiring high 

quality print graphics. 

Specifically excluded from the scope 

are imports of paper and paperboard 

printed with final content printed text 

or graphics. 

As of 2009, imports of the subject 

merchandise are provided for under the 

following categories of the Harmonized 

Tariff Schedule of the United States 

(‘‘HTSUS’’): 4810.14.11, 4810.14.1900, 

4810.14.2010, 4810.14.2090, 

4810.14.5000, 4810.14.6000, 4810.14.70, 

4810.19.1100, 4810.19.1900, 

4810.19.2010, 4810.19.2090, 

4810.22.1000, 4810.22.50, 4810.22.6000, 

4810.22.70, 4810.29.1000, 4810.29.5000, 

4810.29.6000, 4810.29.70. While 

HTSUS subheadings are provided for 

convenience and customs purposes, the 

written description of the scope of this 

investigation is dispositive. 

The HTSUS subheadings are provided 

for convenience and customs purposes 

only, the written description of the 

scope of this investigation is dispositive. 

Injury Test 

Because the PRC is a ‘‘Subsidies 

Agreement Country’’ within the meaning 

of section 701(b) of the Tariff Act of 

1930, as amended (‘‘the Act’’), the 

International Trade Commission (the 

‘‘ITC’’) is required to determine whether 

imports of the subject merchandise from 

the PRC materially injure, or threaten 

material injury to, a U.S. industry. On 

November 9, 2009, the U.S. 

International Trade Commission (‘‘ITC’’) 

issued its affirmative preliminary 

determination that there is a reasonable 

indication that an industry in the 

United States is materially injured by 

reason of allegedly subsidized imports 

of coated paper from the PRC. See 

Certain Coated Paper Suitable for High– 

Quality Print Graphics Using Sheet–Fed 

Presses From China and Indonesia; 

Determinations, Investigation Nos. 701– 

TA–470–471 and 731–TA–1169–1170, 

74 FR 61174 (November 23, 2009). 

Alignment of Final Countervailing Duty 

Determination with Final Antidumping 

Duty Determination 

On October 14, 2009, the Department 

initiated the CVD and AD investigations 

of coated paper from Indonesia and the 

PRC. See Initiation Notice, Certain 

Coated Paper From Indonesia: Initiation 

of Countervailing Duty Investigations, 

74 FR 53707 (October 20, 2009) and 

Certain Coated Paper Suitable for High– 

Quality Print Graphics Using Sheet–Fed 

Presses From Indonesia and the 

People’s Republic of China: Initiation of 

Antidumping Duty Investigations, 74 FR 

53710 (October 20, 2009). The CVD and 

the AD investigations have the same 

scope with regard to the merchandise 

covered. 

On February 25, 2010, Petitioners 

submitted a letter, in accordance with 

section 705(a)(1) of the Act, requesting 

alignment of the final CVD 

determinations with the final 

determinations in the companion AD 

investigations of coated paper from 

Indonesia and the PRC. Therefore, in 

accordance with section 705(a)(1) of the 

Act and 19 CFR 351.210(b)(4), we are 

aligning the final CVD determination 

with the final determination in the 

companion AD investigation of coated 

paper from the PRC. Consequently, the 

final CVD determination will be issued 

no later than July 12, 2010, unless 

postponed in the companion AD 

investigation. 

Period of Investigation 

The period for which we are 

measuring subsidies, i.e., the period of 

investigation (‘‘POI’’), is January 1, 2008, 

through December 31, 2008. 

Application of the Countervailing Duty 

Law to Imports from the PRC 

On October 25, 2007, the Department 

published CFS from the PRC, and the 

accompanying CFS Decision 

Memorandum. In CFS from the PRC, the 

Department found that 


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given the substantial differences 

between the Soviet–style economies 

and China’s economy in recent 

years, the Department’s previous 

decision not to apply the CVD law 

to these Soviet–style economies 

does not act as a bar to proceeding 

with a CVD investigation involving 

products from China. 

See CFS Decision Memorandum, at 

Comment 6. The Department has 

affirmed its decision to apply the CVD 

law to the PRC in subsequent final 

determinations. See, e.g., Circular 

Welded Carbon Quality Steel Pipe from 

the People’s Republic of China: Final 

Affirmative Countervailing Duty 

Determination and Final Affirmative 

Determination of Critical 

Circumstances, 73 FR 31966 (June 5, 

2008), and accompanying Issues and 

Decision Memorandum (‘‘CWP Decision 

Memorandum’’), at Comment 1. 

Additionally, for the reasons stated in 

the CWP Decision Memorandum, we are 

using the date of December 11, 2001, the 

date on which the PRC became a 

member of the World Trade 

Organization, as the date from which 

the Department will identify and 

measure subsidies in the PRC. See CWP 

Decision Memorandum, at Comment 2. 

Use of Facts Otherwise Available and 

Adverse Inferences 

Sections 776(a)(1) and (2) of the Act 

provide that the Department shall apply 

‘‘facts otherwise available’’ if necessary 

information is not on the record or an 

interested party or any other person: (A) 

withholds information that has been 

requested; (B) fails to provide 

information within the deadlines 

established, or in the form and manner 

requested by the Department, subject to 

subsections (c)(1) and (e) of section 782 

of the Act; (C) significantly impedes a 

proceeding; or (D) provides information 

that cannot be verified as provided by 

section 782(i) of the Act. 

Section 776(b) of the Act further 

provides that the Department may use 

an adverse inference in applying the 

facts otherwise available when a party 

has failed to cooperate by not acting to 

the best of its ability to comply with a 

request for information. 

GOC – Papermaking Chemicals (Kaolin 

Clay, Calcium Carbonate, Titanium 

Dioxide) 

The Department is investigating the 

alleged provision of kaolin clay, calcium 

carbonate, and titanium dioxide for less 

than adequate remuneration by the 

GOC. We requested information from 

the GOC regarding the specific 

companies that produced these 

papermaking chemicals used by the 

Gold companies and Sun Paper 

companies, and more generally about 

the market in the PRC for these 

chemicals. 

With respect to the specific 

companies that produced the 

papermaking chemicals purchased by 

the Gold companies and Sun Paper 

companies, we were seeking 

information that would allow us to 

determine whether the producers are 

‘‘authorities’’ within the meaning of 

section 771(5)(B) of the Act. 

Specifically, we stated in our 

questionnaire that the Department 

normally treats producers that are 

majority owned by the government or a 

government entity as ‘‘authorities.’’ 

Thus, for any producers of kaolin clay, 

calcium carbonate, or titanium dioxide 

that were majority government–owned, 

the GOC needed to provide the 

requested information only if it wished 

to argue that those producers were not 

authorities. For any suppliers that the 

GOC claimed were directly, 100–percent 

owned by individual persons during the 

POI, we requested the following: 

• Translated copies of source 

documents that demonstrate the 

supplier’s ownership during the 

POI, such as capital verification 

reports, articles of association, share 

transfer agreements, or financial 

statements. 

• Identification of the owners, 

members of the board of directors, 

or managers of the suppliers who 

were also government or Chinese 

Communist Party (‘‘CCP’’) officials 

during the POI. 

• A discussion of whether and how 

operational or strategic decisions 

that are made by the management or 

board of directors are subject to 

government review or approval. 

Finally, for input suppliers with some 

direct corporate ownership or less–thanmajority state ownership during the 

POI, we explained that it was necessary 

to trace back the ownership to the 

ultimate individual or state owners. For 

these suppliers, we requested the 

following: 

• The total level (percentage) of state 

ownership of the company’s shares; 

the names of all government entities 

that own shares, either directly or 

indirectly, in the company; whether 

any of the owners are considered 

‘‘state–owned enterprises’’ by the 

government; and the amount of 

shares held by each government 

owner. 

• For each level of ownership, a 

translated copy of the section(s) of 

the articles of association showing 

the rights and responsibilities of the 

shareholders and, where 

appropriate, the board of directors, 

including all decision making 

(voting) rules for the operation of 

the company. 

• For each level of ownership, 

identification of the owners, 

members of the board of directors, 

or managers of the suppliers who 

were also government or CCP 

officials during the POI. 

• A discussion of whether and how 

operational or strategic decisions 

that are made by the management or 

board of directors are subject to 

government review or approval. 

• A statement of whether any of the 

shares held by government entities 

have any special rights, priorities, 

or privileges, e.g., with regard to 

voting rights or other management 

or decision–making for the 

company; a statement of whether 

there are any restrictions on 

conducting, or acting through, 

extraordinary meetings of 

shareholders; whether there are any 

restrictions on the shares held by 

private shareholders; and the nature 

of the private shareholders’ interest 

in the company, e.g., operational, 

strategic, or investment–related, etc. 

In the GQR at 127, the GOC stated that 

it had not obtained complete ownership 

information for the companies that 

produced these papermaking chemicals 

purchased by the Gold companies and 

Sun Paper companies. The GOC further 

stated that it expected to provide such 

information when the Department 

determined which cross–owned 

affiliates of the mandatory respondents 

would be required to file responses. See 

GQR at 127–128. 

On January 20, 2010, we issued a 

letter requesting that the GOC update its 

initial questionnaire response for the 

cross–owned affiliates for which the 

Gold companies filed questionnaire 

responses. The GOC filed its response 

on February 12, 2010. 

On January 21, 2010, we issued a 

separate letter noting that the GOC did 

not provide responses to certain 

questions in the original questionnaire 

regarding chemical suppliers. We 

pointed out that the GOC had not 

requested, and the Department had not 

granted, an extension of the deadline for 

submitting this information. We stated 

that the requested information must be 

submitted by February 4, 2010. 

Subsequently, the deadline was 

extended to February 25, 2010. 

On February 16, 2010, the GOC 

submitted a list of the producers of 

these papermaking chemicals purchased 

by Respondents during the POI and 


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documents that appear to establish the 

direct owners of most of them. 

Additional documentation was 

submitted on February 25, 2010 

regarding the ownership of additional 

papermaking chemical suppliers. Based 

on the submitted information, the 

papermaking chemical producers 

present a variety of ownership 

structures: majority government owned; 

corporate ownership; corporate and 

individual ownership; and individual 

ownership. Where there was ownership 

by individuals, the GOC did not answer 

the question on whether owners, 

members of the board of directors, or 

managers of the suppliers were also 

government or CCP officials during the 

POI. The GOC also did not discuss 

whether and how operational or 

strategic decisions that are made by the 

management or board of directors are 

subject to government review or 

approval. For producers with some 

direct corporate ownership or less–thanmajority state ownership during the 

POI, the GOC did not respond to our 

requests for the following information: 

• The total level (percentage) of state 

ownership of the company’s shares; 

the names of all government entities 

that own shares, either directly or 

indirectly, in the company; whether 

any of the owners are considered 

‘‘state–owned enterprises’’ by the 

government; and the amount of 

shares held by each government 

owner. 

• For each level of ownership, 

identification of the owners, 

members of the board of directors, 

or managers of the suppliers who 

were also government or CCP 

officials during the POI. 

• A discussion of whether and how 

operational or strategic decisions 

that are made by the management or 

board of directors are subject to 

government review or approval. 

• A statement of whether any of the 

shares held by government entities 

have any special rights, priorities, 

or privileges, e.g., with regard to 

voting rights or other management 

or decision–making for the 

company; a statement of whether 

there are any restrictions on 

conducting, or acting through, 

extraordinary meetings of 

shareholders; whether there are any 

restrictions on the shares held by 

private shareholders; and the nature 

of the private shareholders’ interest 

in the company, e.g., operational, 

strategic, or investment–related, etc. 

Based on the above, we preliminarily 

determine that the GOC has withheld 

necessary information that was 

requested of it and, thus, that the 

Department must rely on ‘‘facts 

available’’ in making our preliminary 

determination. See sections 776(a)(1) 

and (a)(2)(A) of the Act. Moreover, we 

preliminarily determine that the GOC 

has failed to cooperate by not acting to 

the best of its ability to comply with our 

request for information. Consequently, 

an adverse inference is warranted in the 

application of facts available. See 

section 776(b) of the Act. Therefore, we 

are assuming adversely that all of 

Respondents’ non–cross-owned 

suppliers of kaolin clay, calcium 

carbonate, and titanium dioxide are 

‘‘authorities.’’ 

As explained above, the Department 

also requested more general information 

from the GOC about the markets in the 

PRC for these chemicals. This additional 

information is necessary to determine 

whether these papermaking chemicals 

have been provided for less than 

adequate remuneration because it 

allows us to establish a benchmark for 

determining whether a benefit has been 

provided. The GOC initially provided 

information in the GSR and then 

updated this information in the G2SR. 

Upon review of the submitted 

information, we determine we require 

additional information, including 

information about the GOC’s ownership 

classifications, other ways in which the 

GOC may influence the markets for 

these papermaking chemicals in the 

PRC, and the efforts the GOC has made 

to obtain certain of the requested data. 

Therefore, while we have preliminarily 

determined that the producers of the 

papermaking chemicals purchased by 

the Gold companies and Sun Paper 

companies are ‘‘authorities,’’ we are not 

making a finding that these chemicals 

have been provided for less than 

adequate remuneration for this 

preliminary determination and have 

listed these alleged subsidies under the 

‘‘Programs for Which More Information 

Is Required’’ section, below. 

GOC – Electricity 

The GOC also did not provide a 

complete response to the Department’s 

request for information regarding the 

GOC’s alleged provision of electricity 

for less than adequate remuneration. 

Specifically, the Department requested 

that the GOC explain how electricity 

cost increases are reflected in retail 

price increases. In its GSR, the GOC 

responded that it was gathering this 

information, but it did not request an 

extension from the Department for 

submitting this information after the 

original questionnaire deadline date. 

As explained above in connection 

with the information requested about 

the producers of papermaking chemicals 

purchased by the Gold companies and 

Sun Paper companies, the Department 

made clear that its standard 

investigation procedures require the 

GOC to request an extension when it is 

not able to meet a deadline. See, e.g., 19 

CFR 351.302(c). In this regard, the 

Department notes that the GOC has 

participated in numerous CVD 

investigations and the GOC is familiar 

with this standard procedure. Because 

the GOC did not ask for or receive an 

extension of that deadline, we 

preliminarily determine that the GOC 

has failed to provide necessary 

information and, thus, the Department 

must rely on ‘‘facts available’’ in making 

our preliminary determination. See 

section 776(a)(1), section 776(a)(2)(A) of 

the Act. Moreover, we preliminarily 

determine that the GOC has failed to 

cooperate by not acting to the best of its 

ability to comply with our request for 

information as it did not respond by the 

deadline dates, nor did it provide any 

explanation stating why it was unable to 

provide the requested information by 

the established deadlines, with the 

result that an adverse inference is 

warranted in the application of facts 

available. See section 776(b) of the Act. 

In drawing an adverse inference, we 

find that the GOC’s provision of 

electricity constitutes a financial 

contribution within the meaning of 

section 771(5)(D) of the Act and is 

specific within the meaning of section 

771(5A) of the Act. We have also relied 

on an adverse inference in selecting the 

benchmark for determining the 

existence and amount of the benefit. See 

discussion infra at I.D.1 ‘‘Provision of 

Electricity’’ further explaining the 

Department’s determinations with 

respect to financial contribution, 

benefit, and specificity. The benchmark 

rates we have selected as adverse facts 

available are based on GOC electricity 

grid rates we obtained for various 

provinces in the PRC. See GSR at 

Exhibit 9, and Memorandum to File 

from David Neubacher, International 

Trade Compliance Analyst, Office 1, 

‘‘Electricity Rate Data’’ (March 1, 2010) 

(attaching public government rate 

document provided in the CVD 

investigation of ‘‘Certain Kitchen 

Appliance Shelving and Racks from the 

People’s Republic of China’’). 

For details on the calculation of the 

subsidy rate for Respondents, see below 

at section I.D.1, ‘‘Provision of Electricity 

for Less Than Adequate Remuneration.’’ 


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Yanzhou Tianzhang - Exemption for 

City Maintenance and Construction 

Taxes and Education Surcharges for 

FIEs 

In response to the Department’s 

questionnaire, Yanzhou Tianzhang 

reported that it did not use the 

‘‘Exemption for City Maintenance and 

Construction Taxes and Education 

Surcharges for FIEs’’ program. Despite 

this, proprietary information submitted 

by Yanzhou Tianzhang shows the 

company did not pay these taxes or 

surcharges. As explained below in the 

section where we discuss this program, 

there appears to have been some 

confusion about the term ‘‘exemption’’ 

and, in particular, whether companies 

can be ‘‘exempted’’ from paying taxes 

they have never been subject to. 

Because Yanzhou Tianzhang failed to 

provide the information needed to 

calculate its benefit under this program 

(e.g., what the company would have 

owed had it been subject to these taxes 

and surcharges), we are relying on facts 

otherwise available to calculate a 

preliminary margin pursuant to section 

776(a) of the Act. Because we were not 

able to seek clarification from Yanzhou 

Tianzhang before this preliminary 

determination, we are unable to 

determine whether the failure to 

provide this information resulted from a 

failure to cooperate within the meaning 

of section 776(b) of the Act. 

Accordingly, we are applying the Gold 

companies’ calculated rate for this 

program as neutral facts available. 

Subsidies Valuation Information 

Allocation Period 

The average useful life (‘‘AUL’’) period 

in this proceeding, as described in 19 

CFR 351.524(d)(2), is 13 years according 

to the U.S. Internal Revenue Service’s 

1977 Class Life Asset Depreciation 

Range System. See U.S. Internal 

Revenue Service Publication 946 (2008), 

How to Depreciate Property, at Table B– 

2: Table of Class Lives and Recovery 

Periods. No party in this proceeding has 

disputed this allocation period. 

Attribution of Subsidies 

The Department’s regulations at 19 

CFR 351.525(b)(6)(i) state that the 

Department will normally attribute a 

subsidy to the products produced by the 

corporation that received the subsidy. 

However, 19 CFR 351.525(b)(6)(ii)-(v) 

directs that the Department will 

attribute subsidies received by certain 

other companies to the combined sales 

of those companies if (1) cross– 

ownership exists between the 

companies, and (2) the cross–owned 

companies produce the subject 

merchandise, are a holding or parent 

company of the subject company, 

produce an input that is primarily 

dedicated to the production of the 

downstream product, or transfer a 

subsidy to a cross–owned company. 

According to 19 CFR 

351.525(b)(6)(vi), cross–ownership 

exists between two or more corporations 

where one corporation can use or direct 

the individual assets of the other 

corporation(s) in essentially the same 

ways it can use its own assets. This 

regulation states that this standard will 

normally be met where there is a 

majority voting interest between two 

corporations or through common 

ownership of two (or more) 

corporations. The U.S. Court of 

International Trade (‘‘CIT’’) has upheld 

the Department’s authority to attribute 

subsidies based on whether a company 

could use or direct the subsidy benefits 

of another company in essentially the 

same way it could use its own subsidy 

benefits. See Fabrique de Fer de 

Charleroi v. United States, 166 F. Supp. 

2d 593, 600–604 (CIT 2001). 

Gold companies 

GEP and the other mandatory 

respondent, GHS, producers of subject 

merchandise, responded on behalf of 

themselves and the following affiliates: 

Sinar Mas Paper (China) Investment Co., 

Ltd. (‘‘SMPI’’); Ningbo Zhonghua Paper 

Co., Ltd. (‘‘NBZH’’); Ningbo Asia Pulp & 

Paper Co., Ltd. (‘‘NAPP’’); Gold Zuan 

Chemicals (Suzhou) Co., Ltd. (‘‘GZC’’); 

Gold Lun Chemicals (Zhenjiang) Co., 

Ltd. (‘‘GLC’’); Gold Sheng Chemicals 

(Zhenjiang) Co., Ltd. (‘‘GSC’’); Hainan 

Jinhai Pulp & Paper Co., Ltd. (‘‘JHP’’); 

Sichan Jianan Pulp Co., Ltd. (‘‘JAP’’); 

Guangxi Jingui Forestry Co., Ltd. 

(‘‘JGF’’); Guangxi Jinqinzhou High–Yield 

Forest Co., Ltd. (‘‘JQZ’’); Jinqing Yuan 

Timber land (Paper Mill) Co., Ltd. 

(‘‘JQY’’); Hainan Jinhua Forestry Co., 

Ltd. (‘‘JHF’’); Jinshaoguan First Quality 

Timberland (Paper Mill) Ltd. (‘‘JSG’’); 

Yangjiang Golden Sun Forestry Co., Ltd. 

(‘‘YJGS’’); Leizhou Golden Sun Forestry 

Co., Ltd. (‘‘LZGS’’); Ganzhou Golden Sun 

Forestry Co., Ltd. (‘‘GZGS’’); and 

Wenshan Jin Wenshan Forestry Co., Ltd. 

(‘‘WSGWS’’). GEP reported the above 

companies as cross–owned within the 

meaning of 19 CFR 351.525(b)(6)(vi) by 

virtue of ownership, majority– 

ownership, or common control. See 

GEQR at 7–9. Therefore, based on 

information on the record, we 

preliminarily determine that cross– 

ownership existed between GEP, GHS 

and the above companies during the POI 

pursuant to 19 CFR 351.525(b)(6)(vi). 

SMPI is the parent of the responding 

Gold companies. There is no evidence 

that SMPI served as a conduit for 

subsidies to a particular subsidiary. 

Therefore, in accordance with 19 CFR 

351.525(b)(6)(iii), we have attributed the 

subsidies received by SMPI to the 

consolidated sales of SMPI and its 

subsidiaries. 

GEP and GHS reported that NBZH 

and NAPP produced multi–ply coated 

paper during the POI. Although the 

Gold companies claim that multi–ply 

paper products are excluded from this 

investigation, we disagree that they are 

per se excluded (see ‘‘Scope Comments’’ 

section above). Because NBZH and 

NAPP produced multi–ply products that 

meet the scope criteria (e.g., weight, 

brightness, coating, etc.) we are treating 

both NBZH and NAPP as producers of 

subject merchandise and, pursuant to 19 

CFR 351.525(b)(6)(ii), we are attributing 

the subsidies received by NBZH and 

NAPP to the combined sales of GEP, 

GHS, NAPP, and NBZH minus any 

intercompany sales. 

GZC, GLC, and GSC supplied 

papermaking chemicals to GEP and GHS 

during POI. JHP and JAP supplied GEP 

and GHS with pulp during the POI 

during the POI. Finally, JGF, JQZ, JQY, 

JHF, JSG, YJGS, LZGS, GZGS, and 

WSGWS supplied wood to JHP for the 

production of pulp during the POI. See 

GEQR at 7–9. GEP and GHS argue that 

any subsidies to the cross–owned pulp 

and wood producers should not be 

attributed to producers of subject 

merchandise because the pulp and 

wood were used only to produce paper 

sold in the PRC. 

With regard to the cross–owned 

suppliers of papermaking chemicals, we 

preliminarily determine that the 

papermaking chemicals are ‘‘primarily 

dedicated’’ to the production of the 

downstream product, paper, based on 

Respondents having identified them as 

‘‘papermaking chemicals.’’ See GEQR at 

5. Thus, pursuant to 19 CFR 

525(b)(6)(iv), we are attributing 

subsidies received by GSC, GZC, and 

GLC to the combined sales of the input 

and downstream products produced by 

each company (excluding sales between 

the companies). 

In addition, we preliminarily 

determine that subsidies received by the 

cross–owned pulp and wood suppliers 

should be attributed to the combined 

sales of the input and the downstream 

products produced from those inputs 

(excluding sales between the 

companies). This is consistent with the 

Department’s prior determination that 

pulp is ‘‘primarily dedicated’’ to the 

production of paper, as required by 19 

CFR 351.525(b)(6)(iv). See, e.g., CFS 

Decision Memorandum at Comment 18 

and Final Affirmative Countervailing 


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5See CFS Decision Memorandum at 9, Circular 

Welded Austenitic Stainless Pressure Pipe from the 

People’s Republic of China: Final Affirmative 

Countervailing Duty Determination, 74 FR 4936 

(January 28, 2009) and accompanying Issues and 

Decision Memorandum at 11-12 (‘‘CWASP from the 

PRC’’), and Ball Bearings and Parts Thereof From 

Thailand; Final Results of Countervailing Duty 

Administrative Review, 57 FR 26646, 26647 (June 

15, 1992) (‘‘Bearings from Thailand’’). 

Duty Determination and Final Negative 

Critical Circumstances Determination: 

Certain Lined Paper Products from 

Indonesia, 71 FR 47174 (August 16, 

2006), and accompanying Issues and 

Decision Memorandum at Comment 3. 

With regard to GEP’s and GHS’s 

argument that these inputs are not 

included in the downstream products 

exported to the United States, we note 

the Department has addressed this issue 

in other proceedings. See, e.g., Light– 

Walled Rectangular Pipe and Tube 

From People’s Republic of China: Final 

Affirmative Countervailing Duty 

Investigation Determination, 73 FR 

35642 (June 24, 2008) (‘‘LWRP from the 

PRC’’) and accompanying Issues and 

Decision Memorandum (‘‘LWRP 

Decision Memorandum’’) at Comment 8 

and CFS Decision Memorandum at 

Comment 18. We have found that it 

would be improper to trace subsidized 

inputs through a company’s production 

process and it would be improper to tie 

subsidies bestowed on the input 

product exclusively to sales in the 

domestic market. See, e.g., LWRP 

Decision Memorandum at Comment 8. 

Therefore, we have rejected GEP’s and 

GHS’s argument. 

Sun Paper companies 

Sun Paper and Yanzhou Tianzhang 

responded on behalf of themselves. 

They reported that Yanzhou Tianzhang 

is the producer of the subject 

merchandise and Sun Paper is the 

parent company of Yanzhou Tianzhang. 

See I.D.1 ‘‘Provision of Electricity’’ 

section below. There is no evidence that 

Sun Paper served as a conduit for 

subsidies to a particular subsidiary. 

Therefore, in accordance with 19 CFR 

351.525(b)(6)(iii), we have attributed the 

subsidies received by Sun Paper to the 

consolidated sales of Sun Paper and its 

subsidiaries. Sun Paper identified two 

other affiliated companies that produce 

the subject merchandise. Sun Paper 

notes that these two companies, 

International Paper & Sun Cartonboard 

Co., Ltd. and Shandong International 

Paper and Sun Coated Paperboard Co., 

Ltd., are 50/50 joint ventures between 

International Paper, and Sun Paper. 

However, Sun Paper claims that cross– 

ownership does not exist between itself 

and the joint venture companies 

because Sun Paper states that it cannot 

use or direct the individual assets of 

these two joint venture companies in 

the same way that it can use its own 

assets as required under 19 CFR 

351.525(b)(6)(vi). In support of this 

claim, Sun Paper cites to the articles of 

association for both companies. See 

SP1SQR at 2–3. The information 

contained in the documents is 

proprietary and we address it in a 

proprietary memorandum. See 

Memorandum to the File from Mary 

Kolberg, International Trade Analyst, 

regarding ‘‘Sun Paper Calculations for 

the Preliminary Determination’’ (March 

1, 2010). Based on the information and 

analysis described in that 

memorandum, we preliminarily 

determine that Sun Paper is not cross– 

owned with these joint ventures within 

the meaning of 19 CFR 351.525(b)(6)(vi). 

We intend to examine this issue further 

following the preliminary 

determination. 

Finally, Sun Paper and Yanzhou 

Tianzhang identified several other 

affiliated companies, but reported that 

these affiliates do not produce the 

subject merchandise, provide an input 

to the downstream product or otherwise 

fall within the situations described in 19 

CFR 351.525(b)(6)(iii)-(v). See SPQR at 

1–3, YTQR at 1–3, and SP1SQR at 3 and 

4. Therefore, we do not reach the issue 

of whether these companies and Sun 

Paper are cross–owned within the 

meaning of 19 CFR 351.525(b)(6)(vi) and 

we are not including these companies in 

our subsidy calculations. 

Entered Value (‘‘EV’’) Adjustment 

The Gold companies have reported 

that their sales of subject merchandise 

to the United States occur under toll 

processing agreements with two 

affiliated trading companies. Thus, they 

have requested the Department make an 

adjustment to the calculated subsidy 

rate to account for the mark–up between 

the export value from the PRC and the 

entered value of subject merchandise 

into the United States. 

Citing the CFS Decision 

Memorandum, CWASP from the PRC, 

and Bearings from Thailand,5 the Gold 

companies note the Department has 

generally looked at six criteria to 

determine whether to grant such an 

adjustment. The six criteria are: 1) the 

price on which the alleged subsidy is 

based differs from the U.S. invoiced 

price; 2) the exporters and the party that 

invoices the customer are affiliated; 3) 

the U.S. invoice establishes the customs 

value to which CVDs are applied; 4) 

there is a one–to-one correlation 

between the invoice that reflects the 

price on which subsidies are received 

and the invoice with the mark–up that 

accompanies the shipment; 5) the 

merchandise is shipped directly to the 

United States; and 6) the invoices can be 

tracked as back–to-back invoices that 

are identical except for price. 

On February 19, 2010, Petitioners 

filed comments acknowledging that the 

Department should establish a CVD rate 

that is commensurate with the entered 

value of the subject merchandise, but 

arguing against the specific adjustment 

proposed by the Gold companies. First, 

they argue the proposed adjustment is 

inconsistent with law as it results in an 

undercollection of duties. Second, they 

claim the Gold companies have not 

provided sufficient supporting 

information in regard to the six criteria 

for granting the adjustment. Third, they 

cite to proprietary information to argue 

that the adjustment calculated by the 

Gold companies is flawed. Finally, 

Petitioners argue, the best method to 

achieve the goal of matching the subsidy 

calculation with the duties that are 

eventually collected is to use GEP’s 

consolidated sales value as the 

denominator in the subsidy rate 

calculation. If the Department does 

make the adjustment requested by the 

Gold companies, Petitioners request that 

the Department recalculate the 

adjustment because the Gold companies 

have included data in their claimed 

adjustment not related to the entered 

value of the subject merchandise. (The 

exact nature of this data is proprietary.) 

Petitioners supplemented their 

comments on February 23, 2010, with 

additional concerns on the adjustment 

information submitted by the Gold 

companies and also provided an 

alternative adjustment formula to the 

one used by the Department in prior 

cases. Finally, the Department received 

comments from the Gold companies 

responding to Petitioners’ arguments on 

February 24, 2010, and Petitioners 

responded to the Gold companies’ 

submission with additional comments 

on February 25, 2010. 

As indicated by the determinations 

cited by the Gold companies, the 

Department has a practice to make an 

adjustment to the calculated subsidy 

rate when the sales value used to 

calculate that subsidy rate does not 

match the entered value of the 

merchandise, i.e., where subject 

merchandise exported to the United 

States is produced under tolling 

agreements, and where the respondent 

can provide data to demonstrate that the 

six criteria above are met. In the instant 

case, we have not made the adjustment 

because the information submitted by 

the Gold companies did not permit an 

accurate calculation of the adjustment. 


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6See CFS from the PRC at Comment 10. 

7See CFS from the PRC at Comment 10. 

8See Lightweight Thermal Paper From the 

People’s Republic of China: Final Affirmative 

Countervailing Duty Determination, 73 FR 57323 

(October 2, 2008) (‘‘LWTP from the PRC’’) and 

accompanying Issues and Decision Memorandum 

(‘‘LWTP Decision Memorandum’’) at 8-11. 

In GESQR at S1–23, the Gold 

companies state the adjustment 

concerns all four paper producing 

companies and two affiliated offshore 

trading companies, GEHK and China 

Union (Macao Offshore) Company 

Limited. Moreover, the Gold companies 

assert that the sample documentation 

they provided demonstrates that each of 

the four companies meet the criteria as 

outlined in the above–mentioned cases. 

We disagree, however, that adequate 

support documentation was provided 

for each of the producer/trading 

company combinations. Moreover, for 

the producer/trading company 

combinations for which adequate 

information was provided, we were not 

able to disaggregate their sales so that 

we could apply the adjustment to them. 

The Department has not applied the 

requested adjustment in this 

preliminary determination because the 

supporting information was not 

submitted and not because we have 

rejected or changed our practice. 

However, Petitioners’ claims about the 

propriety of the current adjustment 

methodology have raised issues that 

could not be fully evaluated in the 

limited time available before the 

preliminary determination. Thus, we 

intend to examine these claims and 

invite parties to provide additional 

comments on the Department’s entered 

value EV adjustment methodology 

following the preliminary determination 

in their case and rebuttal briefs. 

Benchmarks and Discount Rates 

Section 771(5)(E)(ii) of the Act 

explains that the benefit for loans is the 

‘‘difference between the amount the 

recipient of the loan pays on the loan 

and the amount the recipient would pay 

on a comparable commercial loan that 

the recipient could actually obtain on 

the market.’’ Normally, the Department 

uses comparable commercial loans 

reported by the company for 

benchmarking purposes. See 19 CFR 

351.505(a)(3)(i). If the firm did not have 

any comparable commercial loans 

during the period, the Department’s 

regulations provide that we ‘‘may use a 

national interest rate for comparable 

commercial loans.’’ See 19 CFR 

351.505(a)(3)(ii). 

As noted above, section 771(5)(E)(ii) 

of the Act indicates that the benchmark 

should be a market–based rate. For the 

reasons explained in CFS from the 

PRC,6 loans provided by Chinese banks 

reflect significant government 

intervention in the banking sector and 

do not reflect rates that would be found 

in a functioning market. Because of this, 

any loans received by Respondents from 

private Chinese or foreign–owned banks 

would be unsuitable for use as 

benchmarks under 19 CFR 

351.505(a)(3)(i). Similarly, the GOC’s 

intervention in the banking sector 

precludes us from using a national 

interest rate for commercial loans as 

envisaged by 19 CFR 351.505(a)(3)(ii). 

Therefore, because of the special 

difficulties inherent in using a Chinese 

benchmark for loans, the Department is 

selecting an external market–based 

benchmark interest rate. The use of an 

external benchmark is consistent with 

the Department’s practice. 

We are calculating the external 

benchmark using the regression–based 

methodology first developed in CFS 

from the PRC7 and more recently 

updated in LWTP from the PRC.8 This 

benchmark interest rate is based on the 

inflation–adjusted interest rates of 

countries with per capita gross national 

incomes (‘‘GNI’’) similar to the PRC, and 

takes into account a key factor involved 

in interest rate formation, that of the 

quality of a country’s institutions, that 

is not directly tied to the state–imposed 

distortions in the banking sector 

discussed above. 

Following the methodology 

developed in CFS from the PRC, we first 

determined which countries are similar 

to the PRC in terms of GNI, based on the 

World Bank’s classification of countries 

as: low income; lower–middle income; 

upper–middle income; and high 

income. The PRC falls in the lower– 

middle income category, a group that 

includes 55 countries as of July 2007. As 

explained in CFS from the PRC, this 

pool of countries captures the broad 

inverse relationship between income 

and interest rates. 

Many of these countries reported 

lending and inflation rates to the 

International Monetary Fund and they 

are included in that agency’s 

international financial statistics (‘‘IFS’’). 

With the exceptions noted below, we 

have used the interest and inflation 

rates reported in the IFS for the 

countries identified as ‘‘low middle 

income’’ by the World Bank. First, we 

did not include those economies that 

the Department considered to be non– 

market economies for AD purposes for 

any part of the years in question, for 

example: Armenia, Azerbaijan, Belarus, 

Georgia, Moldova, Turkmenistan. 

Second, the pool necessarily excludes 

any country that did not report both 

lending and inflation rates to IFS for 

those years. Third, we removed any 

country that reported a rate that was not 

a lending rate or that based its lending 

rate on foreign–currency denominated 

instruments. For example, Jordan 

reported a deposit rate, not a lending 

rate, and the rates reported by Ecuador 

and Timor L’Este are dollar– 

denominated rates; therefore, the rates 

for these three countries have been 

excluded. Finally, for each year the 

Department calculated an inflation– 

adjusted short–term benchmark rate, we 

have also excluded any countries with 

aberrational or negative real interest 

rates for the year in question. 

The resulting inflation–adjusted 

benchmark lending rates are provided in 

the Respondents’ preliminary 

calculation memoranda. See, e.g., 

Preliminary Determination Calculation 

Memoranda for Gold companies and 

Sun Paper (March 1, 2010). Because 

these are inflation–adjusted 

benchmarks, it is necessary to adjust 

Respondents’ interest payments for 

inflation. This was done using the PRC 

inflation figure as reported in the IFS. 

Id. 

The lending rates reported in the IFS 

represent short- and medium–term 

lending, and there are not sufficient 

publicly available long–term interest 

rate data upon which to base a robust 

benchmark for long–term loans. To 

address this problem, the Department 

has developed an adjustment to the 

short- and medium–term rates to 

convert them to long–term rates using 

Bloomberg U.S. corporate BB–rated 

bond rates. See LWRP from the PRC and 

LWRP Decision Memorandum at 6–8. In 

Citric Acid from the PRC, this 

methodology was revised by switching 

from a long–term mark–up based on the 

ratio of the rates of BB–rated bonds to 

applying a spread which is calculated as 

the difference between the two–year BB 

bond rate and the n–year BB bond rate, 

where ‘‘n’’ equals or approximates the 

number of years of the term of the loan 

in question. See Citric Acid and Certain 

Citrate Salts From the People’s Republic 

of China: Final Affirmative 

Countervailing Duty Determination, 74 

FR 16836 (April 13, 2009) (‘‘Citric Acid 

from the PRC’’) and accompanying 

Issues and Decision Memorandum 

(‘‘Citric Acid from the PRC Decision 

Memorandum’’) at Comment 14. Finally, 

because these long–term rates are net of 

inflation as noted above, we adjusted 

the PRC Respondents’ payments to 

remove inflation. 


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9See CFS Decision Memorandum at 9 and 49. 

10See CFS Decision Memorandum at 9 - 11 and 

LWTP from the PRC and LWTP Decision 

Memorandum at 11 - 12. 

11See Petition at Exhibit IV-34. 

12See Petition at Exhibit IV-39. 

13See GQR at Exhibit A-1. 

14See GQR at Exhibit A-2. 

Benchmarks for Foreign Currency– 

Denominated Loans 

For foreign currency–denominated 

short–term loans, the Department used 

as benchmarks one–year London 

Interbank Offering Rate (‘‘LIBOR’’) rates 

for the currency in which the loan was 

denominated, plus the average spread 

between LIBOR and the one–year 

corporate bond rates for companies with 

a BB rating. For long–term foreign 

currency–denominated loans, the 

Department added to the applicable 

short–term LIBOR rate a spread which 

was calculated as the difference 

between the one–year BB bond rate and 

the n–year BB bond rate, where ‘‘n’’ 

equals or approximates the number of 

years of the term of the loan in question. 

See LWTP Decision Memorandum at 10. 

Uncreditworthiness Benchmark 

As discussed below, the Department 

is finding the Gold companies 

uncreditworthy in 2003 through 2005. 

To construct the uncreditworthy 

benchmark rate for those years, we used 

the long–term rates described above as 

the ‘‘long–term interest rate that would 

be paid by a creditworthy company’’ in 

the formula presented in 19 CFR 

351.505(a)(3)(iii). 

Discount Rates 

Consistent with 19 CFR 

351.524(d)(3)(i)(A), we have used, as our 

discount rate, the long–term interest rate 

calculated according to the methodology 

described above for the year in which 

the government agreed to provide the 

subsidy. 

Creditworthiness 

The examination of creditworthiness 

is an attempt to determine if the 

company in question could obtain long– 

term financing from conventional 

commercial sources. See 19 CFR 

351.505(a)(4). According to 19 CFR 

351.505(a)(4)(i), the Department will 

generally consider a firm to be 

uncreditworthy if, based on information 

available at the time of the government– 

provided loan, the firm could not have 

obtained long–term loans from 

conventional commercial sources. In 

making this determination, according to 

19 CFR 351.505(a)(4)(i)(A)-(D), the 

Department normally examines the 

following four types of information: (1) 

receipt by the firm of comparable 

commercial long–term loans; (2) present 

and past indicators of the firm’s 

financial health; (3) present and past 

indicators of the firm’s ability to meet 

its costs and fixed financial obligations 

with its cash flow; and (4) evidence of 

the firm’s future financial position. If a 

firm has taken out long–term loans from 

commercial sources, this will normally 

be dispositive of the firm’s 

creditworthiness. However, if the firm is 

government–owned, the existence of 

commercial borrowings is not 

dispositive of the firm’s 

creditworthiness. This is because, in the 

case of a government–owned firm, a 

bank is likely to consider that the 

government will repay the loan in the 

event of a default. See Countervailing 

Duties; Final Rule, 63 FR 65348, 65367 

(November 25, 1998). For government– 

owned firms, we will make our 

creditworthiness determination by 

examining receipt by the firm of 

comparable commercial long–term loans 

and the other factors listed in 19 CFR 

351.505 (a)(4)(i). 

Gold East 

In CFS from the PRC, the Department 

found that GEP and its cross–owned 

subsidiaries were uncreditworthy for 

the period 2003 through 2005. See CFS 

Decision Memorandum at 8. In our 

questionnaire, we noted our previous 

finding from CFS from the PRC and 

explained that if the Gold companies 

wished to contest it, the companies 

should provide certain information. 

The Gold companies provided 

information concerning 

creditworthiness, including the 

proprietary final creditworthiness memo 

from CFS from the PRC. Based on our 

review, no new information was 

submitted that would lead us to 

reconsider our prior analysis and, thus, 

we preliminarily reaffirm our 

determination in CFS from the PRC. 

Therefore, we are preliminarily finding 

the Gold companies, including GEP and 

its cross–owned affiliates, to be 

uncreditworthy for the period 2003 

through 2005. 

According to 19 CFR 351.505(a)(6), 

the Department ‘‘will not consider the 

uncreditworthiness of a firm absent a 

specific allegation by petitioner that is 

supported by information establishing a 

reasonable basis to believe or suspect 

that the firm is uncreditworthy.’’ As 

noted above in the Case History section, 

Petitioners have submitted financial 

ratios for the Gold companies and have 

pointed to other evidence on the record 

to argue that these companies were 

uncreditworthy for the period 2006 

through 2008. We are still analyzing this 

data to determine if they provide a 

reasonable basis to believe or suspect 

that the Gold companies were 

uncreditworthy during 2006 through 

2008. If we determine to investigate the 

Gold companies’ creditworthiness for 

the 2006 through 2008 period, we will 

make a preliminary finding on this 

matter prior to our final determination 

and will provide the parties with an 

opportunity to comment on that 

preliminary finding. 

No creditworthiness allegation was 

made with respect to the Sun Paper 

companies. 

Analysis of Programs 

Based upon our analysis of the 

petition and the responses to our 

questionnaires, we preliminarily 

determine the following: 

I. Programs Preliminarily Determined 

To Be Countervailable 

A. Preferential Lending To The Coated 

Paper Industry 

1. Policy Loans to Coated Paper 

Producers and Related Pulp Producers 

from State–Owned Commercial Banks 

and Government Policy Banks 

In the CVD investigation of coated 

free sheet paper, the Department found 

that, ‘‘the GOC has a policy in place to 

encourage and support the growth and 

development of the paper industry 

through preferential financing 

initiatives, as illustrated in the five–year 

plans and industrial policies on the 

record.’’9 The Department further 

determined that, ‘‘loans provided by 

Policy Banks and state–owned 

commercial banks (‘‘SOCBs’’) in the PRC 

constitute a direct financial contribution 

from the government ‘‘ In LWTP from 

the PRC, the Department affirmed its 

earlier finding and extended it through 

the POI. 

Based on the record of the instant 

investigation, the Department 

preliminarily determines that the five– 

year plans and industrial policies cited 

in the CFS Decision Memorandum and 

LWTP Decision Memorandum continue 

to be in effect.10 Specifically, the Tenth 

Five–Year and 2010 Special Plan for the 

Construction of National Forestry and 

Papermaking Integration Project;11 the 

Development Policy for Papermaking 

Industry (2007);12 the Decision of the 

State Council on Promulgating and 

Implementing the Provisional 

Regulation on Promoting Industrial 

Structure Adjustment GUOFA (2005) 

No. 40,13 the Guiding Catalogue for 

Industry Restructuring (2005 version),14

together indicate that the GOC has in 

place a policy to promote specifically 

the pulp and paper industry. 

Additionally, the five–year plans of 


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15See Citric Acid from the PRC Decision 

Memorandum at Comment 5 (citations omitted). 16See CFS Decision Memorandum at Comment 8. 

provinces and municipalities where 

Respondents in this investigation are 

located provide evidence of sub– 

national government support for these 

objectives. For example: 

The Outline of the Tenth Five–year 

Plan (Jihua) of Social and Economic 

Development of Jiangsu Province: In 

describing how it seeks to adjust the 

province’s economic structure, the 

plan states ‘‘ we will selectively 

develop such industries with local 

advantages, including modern 

papermaking ‘‘ See GQR at A–3, 

Chapter II (‘‘Adjustment of 

Economic Structure’’), Section 5 

(‘‘Optimize Industrial Structure to 

Enhance Overall Competitiveness’’), 

paragraph 12. 

Outline of the Eleventh Five–year Plan 

(Guihua) for Economic and Social 

Development of Jiangsu: In 

describing its ‘‘Priorities in 

Development and Policy Making,’’ 

this provincial plan states that 

Jiangsu will ‘‘push the efficiency’’ of 

the forest industry and, in 

developing its manufacturing 

industry, it will ‘‘lay emphasis upon 

the development of competitive 

industries. By setting up industrial 

bases of paper making, we shall 

increase shares of competitive 

industries in manufacturing ‘‘ See 

GQR at A – 4, Volume III (‘‘Priorities 

in Development and Policy 

Making’’); Chapter V (‘‘Industry 

Development’’), Section 1 

(‘‘Developing Modern and Efficient 

Agriculture’’) and Section 2 

(‘‘Developing Advanced 

Manufacturing Industry’’). 

Tenth Five–year Plan (Jihua) of Social 

and Economic Development of 

Suzhou Municipality: In describing 

the municipality’s goals, the plan 

states ‘‘ focus on the development of 

paper making ‘‘ See GQR at A–5, 

Chapter 2 (‘‘Economic 

Development’’), Section 2 

(‘‘Industry’’). 

Outline of the Tenth Five–year Plan 

(Jihua) for Economic and Social 

Development of Zhenjiang: In 

describing its goals for ‘‘Optimizing 

and enhancing the secondary 

industry industry,’’ this plan 

specifically identifies respondent, 

Gold East (‘‘ strive to form super 

large enterprises which have annual 

sales amount over 5 billion yuan 

including Gold East Paper ’’) and 

names ‘‘paper and paper products 

processing’’ as ‘‘champion’’ 

products. See GQR at A–7, ‘‘Main 

direction and target of the 

development of the 10th Five–year’ 

plan,’’ Section 2 (‘‘Giving 

prominence to the main line of 

structure adjustment, improving the 

overall economy quality’’). 

Notice from the People’s Government 

of Zhenjiang on Issuing the 

‘‘Guideline for the 11th Five–year 

Plan (Jihua) of Economy and Social 

Development of Zhenjiang: Among 

its goals, this plan states that 

Zhenjiang will ‘‘Expand leading 

industries’’ including papermaking. 

See GQR at A–7, Chapter 7 

(‘‘Optimize Industrial Structure and 

Improve Quality of Economic 

Growth’’), Section 1 (‘‘Development 

of Manufacture Industries’’). 

Outline of Tenth Five–year Plan 

(Jihua) for Economic and Social 

Development of Shandong: In 

describing this province’s desire to 

‘‘Promote the optimization and 

upgrade of traditional industries, 

this plan specifically addresses the 

papermaking industry and 

identifies numerous actions, 

including: make efforts to enhance 

product grades; cultivate large 

groups; and rely on large tracts of 

land suitable for forestation and key 

enterprises to build a 700 thousand 

ton hardwood pulp project.’’ See 

GQR at A–8, ‘‘III. Emphasis on the 

industrial development and 

structural adjustment,’’ ‘‘(7) Promote 

the optimization and upgrade of 

traditional industries,’’ ‘‘6. Paper– 

making Industry.’’ 

Outline of the Eleventh Five–year Plan 

(Guihua) for Economic and Social 

Development of Shandong: This 

plan addresses both forestry and 

papermaking in its call to 

‘‘accelerate building the forest base 

of industrial raw materials’’ and in 

identifying papermaking among the 

new material industries to be 

developed. See GQR at A–09, 

Chapter 5 (‘‘Accelerate the 

Development of Modern 

Agriculture’’) and Chapter 6 

(‘‘Efforts on Construction of the 

Powerful Manufacture Industry 

Province’’). 

Outline of the Tenth Five–year Plan 

(Jihua) of Social and Economic 

Development of Jining Municipality: 

This plan discusses reform of 

traditional industries including 

papermaking and describes as a 

goal developing coated paper. It 

also specifically names Sun Paper 

as among the producers to be 

supported in expanding, upgrading 

and constructing its forest–paper 

project. See GQR at A–10, ‘‘I. To 

vigorously develop modern 

manufacturing industry,’’ ‘‘2. To 

reform traditional industries and 

shore up and foster emerging 

industries.’’ Virtually identical 

language appears in the Outline of 

the Eleventh Five–year Program 

(GUIHUA) of Social and Economic 

Development of Jining Municipality. 

See GQR at A–11, ‘‘I. To vigorously 

develop modern manufacturing 

industry,’’ ‘‘2. To reform traditional 

industries and shore up and foster 

emerging industries.’’ 

In Citric Acid from the PRC,15 the 

Department stated: 

In general, the Department looks to 

whether government plans or other 

policy directives lay out objectives 

or goals for developing the industry 

and call for lending to support 

those objectives or goals. Where 

such plans or policy directives 

exist, then we will find a policy 

lending program that is specific to 

the named industry (or producers 

that fall under that industry). Once 

that finding is made, the 

Department relies upon the analysis 

undertaken in CFS from the PRC to 

further conclude that national and 

local government control over the 

SOCBs results in the loans being a 

financial contribution by the GOC. 

In this investigation, the GOC has not 

provided evidence that would lead us to 

revisit our finding in CFS from the PRC 

regarding government control of the 

SOCBs.16 Therefore, we preliminarily 

determine that the loans to Respondents 

from policy banks and SOCBs are a 

financial contribution in the form of a 

direct transfer of funds and that they 

provide a benefit equal to the difference 

between what the recipients paid on 

their loans and the amount they would 

have paid on comparable commercial 

loans. See sections 771(5)(D)(i) and 

771(5)(E)(ii) of the Act. We further 

determine preliminarily that the loans 

are de jure specific within the meaning 

of section 771(5A)(D)(i) of the Act 

because of the GOC’s policy 

demonstrated by the above–cited plans 

and directives to encourage and support 

the growth and development of the PRC 

pulp and paper industry. 

To calculate the benefit under the 

policy lending program, we used the 

benchmarks described under ‘‘Subsidies 

Valuation - Benchmarks and Discount 

Rates’’ above. As noted in the 

‘‘Creditworthiness’’ section above, we 

have determined the Gold companies to 

be uncreditwothy for the period 2003 

through 2005; therefore, we have used 

an uncreditworthy benchmark as set 

forth under 19 CFR 351.505(a)(3)(iii) for 

loans approved in those years. 


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17See Certain Oil Country Tubular Goods From 

the People’s Republic of China: Final Affirmative 

Countervailing Duty Determination, Final Negative 

Critical Circumstances Determination, 74 FR 64045 

(December 7, 2009) and accompanying Issues and 

Decision Memorandum (‘‘OCTG Decision 

Memorandum’’). 

For the paper producing Gold 

companies, we divided the benefit 

received during the POI by the 

combined sales of the Gold companies’ 

paper producers. For the cross–owned 

input suppliers among the Gold 

companies, we divided the benefit by 

the combined sales of the Gold 

companies’ paper producers that 

received the inputs plus the input 

suppliers’ sales minus inter–company 

sales during the POI. For SMPI, we 

divided the benefit by its consolidated 

sales. We then summed the calculated 

rates. 

For Yanzhou Tianzhang, we divided 

its benefit received during the POI by its 

sales during the POI. For Sun Paper, we 

divided the benefit by its consolidated 

sales. We then summed the calculated 

rates. 

On this basis, we preliminarily 

determine that the Gold companies 

received a countervailable subsidy of 

7.27 percent ad valorem and the Sun 

Paper companies received a 

countervailable subsidy of 0.94 percent 

ad valorem. 

B. Income Tax Programs 

1. Income Tax Exemption/Reduction 

under the Two Free/Three Half Program 

Under Article 8 of the FIE Tax Law, 

a foreign–invested enterprise (‘‘FIE’’) 

that is ‘‘productive’’ and is scheduled to 

operate for more than ten years may be 

exempted from income tax in the first 

two years of profitability and pay 

income taxes at half the standard rate 

for the next three years. See GQR at 34. 

The Department has previously found 

this program countervailable. See, e.g., 

OCTG Decision Memorandum17 at 16, 

CFS Decision Memorandum at 11 12, 

and Citric Acid from the PRC Decision 

Memorandum at 15–16. 

GEP, GHS, GZC, GLC, JHF, JAP, JQZ, 

and JQY reported using this program 

during the POI. See GEQR at 34. 

Yanzhou Tianzhang also reported using 

this program during the POI. See YTQR 

at 13. 

We preliminarily determine that the 

exemption or reduction of the income 

tax paid by productive FIEs under this 

program confers a countervailable 

subsidy. The exemption/reduction is a 

financial contribution in the form of 

revenue forgone by the GOC and it 

provides a benefit to the recipient in the 

amount of the tax savings. See section 

771(5)(D)(ii) of the Act and 19 CFR 

351.509(a)(1). We also preliminarily 

determine that the exemption/reduction 

afforded by this program is limited as a 

matter of law to certain enterprises, i.e., 

‘‘productive’’ FIEs and, hence, is specific 

under section 771(5A)(D)(i) of the Act. 

See CFS Decision Memorandum, at 

Comment 14. 

To calculate the benefit, we treated 

the income tax savings enjoyed by GEP, 

GHS, GZC, GLC, JHF, JAP, JQZ, JQY, 

and Yanzhou Tianzhang as a recurring 

benefit, consistent with 19 CFR 

351.524(c)(1). To compute the amount 

of the tax savings, we compared the 

income tax rate the above companies 

would have paid in the absence of the 

program (30 percent) with the income 

tax rate the company actually paid (15 

or zero percent). 

For the paper producing Gold 

companies, we divided the tax savings 

received during the POI by the 

combined sales of the Gold companies’ 

paper producers. For the cross–owned 

input suppliers among the Gold 

companies, we divided the tax savings 

by the combined sales of the Gold 

companies’ paper producers that receive 

the inputs plus the input suppliers’ 

sales minus inter–company sales during 

the POI. 

For Yanzhou Tianzhang, we divided 

its tax savings received during the POI 

by its sales during the POI. 

On this basis, we preliminarily 

determine that the Gold companies 

received a countervailable subsidy of 

1.37 percent ad valorem and Yanzhou 

Tianzhang received a countervailable 

subsidy of 1.46 percent ad valorem 

under this program. 

2. Local Income Tax Exemption and 

Reductions for ‘‘Productive’’ FIEs 

Under Article 9 of the FIE Tax Law, 

the provincial governments have the 

authority to exempt FIEs from the local 

income tax of three percent. See GQR at 

56. According to the Regulations on 

Exemption and Reduction of Local 

Income Tax of FIEs in Jiangsu Province, 

a ‘‘productive’’ FIE in Jiangsu Province 

may be exempted from the three percent 

local income tax during the ‘‘Two Free, 

Three Half’’ period. Additionally, 

according to Article 6, FIEs eligible for 

the reduced income tax rate of 15 

percent can also be exempted from 

paying local income tax. See GQR at 

Exhibit GOC–HH–3. According to the 

Provisional Rules on Exemption of Local 

Income Tax for FIEs and Foreign 

Enterprises (Decree 14 of Zhejiang 

Government, 1991) at Article 4, 

productive FIEs in Zhejiang Province 

are exempted from paying the local 

income tax for the first two years after 

their first profitable year, and pay at a 

reduced (half) rate for the next three 

consecutive years. See G1SR at Exhibit 

GOC–SUPP–35. The Department has 

previously found this program to be 

countervailable. See, e.g., OCTG 

Decision Memorandum at 17 – 18, CFS 

Decision Memorandum at 12–13 and 

Citric Acid from the PRC Decision 

Memorandum at 21. 

GEP, GHS, NBZH, GZC, GLC, GSC, 

JHP, JHF, JAP, JQZ, and JQY reported 

using this program during the POI. See 

GEQR at 39. Yanzhou Tianzhang also 

reported using this program during the 

POI. See YTQR at 14. 

We preliminarily determine that the 

exemption from or reduction in the 

local income tax received by 

‘‘productive’’ FIEs under this program 

confers a countervailable subsidy. The 

exemption or reduction is a financial 

contribution in the form of revenue 

forgone by the government and it 

provides a benefit to the recipient in the 

amount of the tax savings. See section 

771(5)(D)(ii) of the Act and 19 CFR 

351.509(a)(1). We also preliminarily 

determine that the exemption or 

reduction afforded by this program is 

limited as a matter of law to certain 

enterprises, i.e., ‘‘productive’’ FIEs and, 

hence, is specific under section 

771(5A)(D)(i) of the Act. 

To calculate the benefit, we treated 

the income tax savings enjoyed by GEP, 

GHS, NBZH, GZC, GLC, GSC, JHP, JHF, 

JAP, JQZ, JQY, and Yanzhou Tianzhang 

as a recurring benefit, consistent with 19 

CFR 351.524(c)(1). To compute the 

amount of the tax savings, we compared 

the income tax rate the above companies 

would have paid in the absence of the 

program (three percent) with the income 

tax rate the company actually paid. 

For the paper producing Gold 

companies, we divided the tax savings 

received during the POI by the 

combined sales of the Gold companies’ 

paper producers. For the cross–owned 

input suppliers among the Gold 

companies, we divided the tax savings 

by the combined sales of the Gold 

companies’ paper producers that receive 

the inputs plus the input suppliers’ 

sales minus inter–company sales during 

the POI. For Yanzhou Tianzhang, we 

divided its tax savings received during 

the POI by its sales during the POI. 

On this basis, we preliminarily 

determine that the Gold companies 

received a countervailable subsidy of 

0.36 percent ad valorem and Yanzhou 

Tianzhang received a countervailable 

subsidy of 0.31 percent ad valorem 

under this program. 


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3. Income Tax Reduction for FIEs 

Purchasing Domestically Produced 

Equipment 

The GOC responded that the program 

does not exist. See GQR at 68. However, 

Yanzhou Tianzhang reported that it 

received benefits under this program 

during the POI and referenced the 

relevant law, ‘‘Notice of the Ministry of 

Finance and the State Administration of 

Taxation concerning the Issue of Tax 

Credit for Enterprise Income Tax for 

Domestic Equipment Purchased by 

Foreign–funded Enterprises.’’ See YTQR 

at 15. 

In its questionnaire response, the GOC 

stated that this alleged subsidy program 

does not exist. See GQR at 68. In our 

supplemental questionnaire to the GOC, 

we noted that Yanzhou Tianzhang 

reported using this program and that the 

Department had previously found this 

program to be countervailable in Citric 

Acid from the PRC. See Citric Acid from 

the PRC Decision Memorandum at 16 – 

17. The GOC responded that Yanzhou 

Tianzhang may have been confused 

between the terms ‘‘reduction’’ and 

‘‘credit’’ and that no such program exists. 

Yanzhou Tianzhang claims to have 

received a tax reduction under this 

program. Moreover, as noted above, the 

Department previously found this 

program to confer a countervailable 

subsidy and the GOC has provided no 

evidence showing that this program has 

been terminated. Accordingly, we are 

following our previous practice and 

preliminarily determine that Yanzhou 

Tianzhang received a countervailable 

benefit during the POI. 

The tax credits are a financial 

contribution in the form of revenue 

forgone by the government and provide 

a benefit to the recipients in the amount 

of the tax savings. See section 

771(5)(D)(ii) of the Act and 19 CFR 

351.509(a)(1). We further determine that 

these tax credits are contingent upon 

use of domestic over imported goods 

and, hence, are specific under section 

771(5A)(A) and (C) of the Act. 

To calculate the benefit, we treated 

the income tax savings enjoyed by 

Yanzhou Tianzhang as a recurring 

benefit, consistent with 19 CFR 

351.524(c)(1), and divided the 

company’s tax savings by its sales 

during the POI, pursuant to 19 CFR 

351.525(b)(3). 

On this basis, we preliminarily 

determine that Yanzhou Tianzhang 

received a countervailable subsidy of 

0.78 percent ad valorem under this 

program. 

4. Income Tax Subsidies for FIEs Based 

on Geographic Location 

To promote economic development 

and attract foreign investment, 

‘‘productive’’ FIEs located in coastal 

economic zones, special economic 

zones or economic and technical 

development zones in the PRC receive 

preferential tax rates of 15 percent or 24 

percent, depending on the zone, under 

Article 7 of the FIE Tax Law. See GQR, 

at 70. This program was created June 15, 

1988, pursuant to the Provisional Rules 

on Exemption and Reduction of 

Corporate Income Tax and Business Tax 

of FIEs in Coastal Economic 

Development Zone issued by the 

Ministry of Finance and the July 1, 

1991, FIE Tax Law continued this 

policy. The Department has previously 

found this program to be 

countervailable. See Citric Acid from 

the PRC Decision Memorandum at 14 - 

15 and CFS Decision Memorandum at 

12. 

GEP, GHS, NBZH, GZC, GLC, GSC, 

JHP, JQZ, and JQY reported using this 

program during the POI. See GEQR at 45 

We preliminarily determine that the 

reduced income tax rate paid by 

productive FIEs under this program 

confers a countervailable subsidy. The 

reduced rate is a financial contribution 

in the form of revenue forgone by the 

GOC and it provides a benefit to the 

recipient in the amount of the tax 

savings. See section 771(5)(D)(ii) of the 

Act and 19 CFR 351.509(a)(1). We 

further determine preliminarily that the 

reduction afforded by this program is 

limited to enterprises located in 

designated geographic regions and, 

hence, is specific under section 

771(5A)(D)(iv) of the Act. 

To calculate the benefit, we treated 

the income tax savings enjoyed by GEP, 

GHS, NBZH, GZC, GLC, GSC, JHP, JQZ, 

and JQY as a recurring benefit, 

consistent with 19 CFR 351.524(c)(1). 

To compute the amount of the tax 

savings, we compared the income tax 

rate the above companies would have 

paid in the absence of the program (30 

percent) with the income tax rate the 

company actually paid (24 or 15 

percent). 

For the paper producing Gold 

companies, we divided the tax savings 

received during the POI by the 

combined sales of the Gold companies’ 

paper producers. For the cross–owned 

input suppliers among the Gold 

companies, we divided the tax savings 

by the combined sales of the Gold 

companies’ paper producers that receive 

the inputs plus the input suppliers’ 

sales minus inter–company sales during 

the POI. 

On this basis, we preliminarily 

determine that the Gold companies 

received a countervailable subsidy of 

1.79 percent ad valorem under this 

program. 

5. Preferential Tax Policies for Research 

and Development (‘‘R&D’’) at FIEs 

According to the Circular on Relevant 

Issues relating to Using R&D Expenses 

to Deduct Taxable Income by FIEs 

(GUOSHUIFA {1999} No. 173), an FIE 

may deduct 150 percent of its qualifying 

R&D expenses from its taxable income 

when those expenses increase by 10 

percent over R&D expenses incurred in 

the last tax year. The deduction is 

capped by taxable income and no carry– 

forward is allowed if the deduction is 

more than the taxable income of the 

current period. See GQR at 82. 

GEP reported using this program 

during the POI. See GEQR at 52. 

We preliminarily determine that the 

exemption from or reduction in the 

income tax received by FIEs under this 

program confers a countervailable 

subsidy. The exemption or reduction is 

a financial contribution in the form of 

revenue forgone by the government and 

it provides a benefit to the recipient in 

the amount of the tax savings. See 

section 771(5)(D)(ii) of the Act and 19 

CFR 351.509(a)(1). We also 

preliminarily determine that the 

exemption or reduction afforded by this 

program is limited as a matter of law to 

certain enterprises, i.e., ‘‘productive’’ 

FIEs and, hence, is specific under 

section 771(5A)(D)(i) of the Act. 

To calculate the benefit, we treated 

the income tax savings enjoyed by GEP 

as a recurring benefit, consistent with 19 

CFR 351.524(c)(1). We divided their tax 

savings received during the POI by the 

combined sales of the Gold companies’ 

paper producers minus inter–company 

sales during the POI. 

On this basis, we preliminarily 

determine that the Gold companies 

received a countervailable subsidy of 

0.02 percent ad valorem under this 

program. 

C. Indirect Tax and Import Tariff 

Programs 

1. Value–Added Tax (‘‘VAT’’) and Tariff 

Exemptions on Imported Equipment 

Enacted in 1997, the Circular of the 

State Council on Adjusting Tax Policies 

on Imported Equipment (GUOFA No. 

37) exempts both FIEs and certain 

domestic enterprises from the VAT and 

tariffs on imported equipment used in 

their production so long as the 

equipment does not fall into prescribed 

lists of non–eligible items. Qualified 

enterprises receive a certificate either 


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from the National Development and 

Reform Commission or its provincial 

branch. To receive the exemptions, 

qualified enterprises must adequately 

document both the product eligibility 

and the eligibility of the imported 

article to the local Customs authority. 

See GQR at 96–97. The Department has 

previously found this program to be 

countervailable. See Citric Acid from 

the PRC Decision Memorandum at 19 - 

20 and CFS Decision Memorandum at 

14. 

GEP, GHS, NBZH, NAPP, GZC, GLC, 

GSC, JHP, and JAP reported using this 

program. See GEQR at 63. Yanzhou 

Tianzhang reported using this program. 

See YTQR at 20. 

We preliminarily determine that VAT 

and tariff exemptions on imported 

equipment confer a countervailable 

subsidy. The exemptions are a financial 

contribution in the form of revenue 

forgone by the GOC and they provide a 

benefit to the recipients in the amount 

of the VAT and tariff savings. See 

section 771(5)(D)(ii) of the Act and 19 

CFR 351.510(a)(1). We further determine 

the VAT and tariff exemptions under 

this program are specific under section 

771(5A)(D)(i) because the program is 

limited to certain enterprises, i.e., FIEs 

and domestic enterprises with 

government–approved projects. See CFS 

Decision Memorandum, at Comment 16. 

Normally, we treat exemptions from 

indirect taxes and import charges, such 

as the VAT and tariff exemptions, as 

recurring benefits, consistent with 19 

CFR 351.524(c)(1), and expense these 

benefits in the year in which they were 

received. However, when an indirect tax 

or import charge exemption is provided 

for, or tied to, the capital structure or 

capital assets of a firm, the Department 

may treat it as a non–recurring benefit 

and allocate the benefit to the firm over 

the AUL. See 19 CFR 351.524(c)(2)(iii) 

and 19 CFR 351.524(d)(2). 

For GEP, GHS, NBZH, NAPP, GZC, 

GLC, GSC, JHP, JAP, and Yanzhou 

Tianzhang, we applied the ‘‘0.5 test,’’ 

pursuant to 19 CFR 351.524, for each of 

the years in which exemptions were 

reported (treating year of receipt as year 

of approval). For the years in which the 

amount was less than 0.5 percent, we 

have expensed the exempted amounts 

in the year of receipt, consistent with 19 

CFR 351.524(a). For those years in 

which the VAT and tariff exemptions 

were greater than or equal to 0.5 

percent, we are treating the exemptions 

as non–recurring benefits, consistent 

with 19 CFR 351.524(c)(2)(iii), and 

allocating the benefits over the AUL. We 

used the discount rate described above 

in the ‘‘Benchmarks and Discount Rates’’ 

section to calculate the amount of the 

benefit for the POI. 

For the paper producing Gold 

companies, we divided the benefits 

received in or allocated to the POI by 

the combined sales of the Gold 

companies’ paper producers. For the 

cross–owned input suppliers among the 

Gold companies, we divided the 

benefits received in or allocated to the 

POI by the combined sales of the Gold 

companies’ paper producers that receive 

the inputs plus the input suppliers’ 

sales minus inter–company sales during 

the POI. 

For Yanzhou Tianzhang, we divided 

the benefits received in or allocated to 

the POI by its sales during the POI. 

On this basis, we preliminarily 

determine that the Gold companies 

received a countervailable subsidy of 

0.83 percent ad valorem and Yanzhou 

Tianzhang does not have a measurable 

subsidy under this program. 

2. VAT Rebates on Domestically 

Produced Equipment 

As outlined in GUOSHUIFA (1999) 

No. 171, Notice of the State 

Administration of Taxation Concerning 

the Trial Administrative Measures on 

Purchase of Domestically Produced 

Equipment by FIEs, the GOC refunds the 

VAT on purchases of certain 

domestically produced equipment to 

FIEs if the purchases are within the 

enterprise’s investment amount and if 

the equipment falls under a tax–free 

category. See GQR at 111. The 

Department has previously found this 

program to be countervailable. See 

Citric Acid from the PRC Decision 

Memorandum at 20 and CFS Decision 

Memorandum at 13 – 14. 

GEP, GHS, NBZH, NAPP, GZC, GLC, 

JHP, and JAP reported using the 

program. See GEQR at 67. 

We preliminarily determine that the 

rebate of the VAT paid on purchases of 

domestically produced equipment by 

FIEs confers a countervailable subsidy. 

The rebates are a financial contribution 

in the form of revenue forgone by the 

GOC and they provide a benefit to the 

recipients in the amount of the tax 

savings. See section 771(5)(D)(ii) of the 

Act and 19 CFR 351.510(a)(1). We 

further preliminarily determine that the 

VAT rebates are contingent upon the 

use of domestic over imported goods 

and, hence, specific under section 

771(5A)(A) and (C) of the Act. 

Normally, we treat exemptions from 

indirect taxes and import charges, such 

as VAT rebates, as recurring benefits, 

consistent with 19 CFR 351.524(c)(1), 

and expense these benefits in the year 

they were received. However, when an 

indirect tax or import charge exemption 

is provided for, or tied to, the capital 

structure or capital assets of a firm, the 

Department may treat it as a non– 

recurring benefit and allocate the benefit 

to the firm over the AUL. See 19 CFR 

351.524(c)(2)(iii) and 19 CFR 

351.524(d)(2). 

For GEP, GHS, NBZH, NAPP, GZC, 

GLC, JHP, and JAP, we applied the ‘‘0.5 

test,’’ pursuant to 19 CFR 351.524, for 

each of the years in which rebates were 

reported (treating year of receipt as year 

of approval). For the years in which the 

amount was less than 0.5 percent, we 

have expensed the rebates in the year of 

receipt, consistent with 19 CFR 

351.524(a). For those years in which the 

VAT rebates were greater than or equal 

to 0.5 percent, we preliminarily 

determine that the VAT and tariff 

exemptions were for capital equipment 

based on the companies’ information. 

See GEQR at 69. Therefore, we are 

treating the rebates as non–recurring 

benefits, consistent with 19 CFR 

351.524(c)(2)(iii), and allocating the 

benefits over the AUL. We used the 

discount rate described above in the 

‘‘Benchmarks and Discount Rates’’ 

section to calculate the amount of the 

benefit for the POI. 

For the paper producing Gold 

companies, we divided the benefits 

received in or allocated to the POI by 

the combined sales of the Gold 

companies’ paper producers. For the 

cross–owned input suppliers among the 

Gold companies, we divided the 

benefits received in or allocated to the 

POI by the combined sales of the Gold 

companies’ paper producers that receive 

the inputs plus the input suppliers’ 

sales minus inter–company sales during 

the POI. 

On this basis, we preliminarily 

determine that the Gold companies 

received a countervailable subsidy of 

0.22 percent ad valorem under this 

program. 

3. Domestic VAT Refunds for 

Companies Located in the Hainan 

Economic Development Zone (‘‘EDZ’’) 

According to ‘‘Circular on Publication 

of the Preferential Policies for Hainan 

Province Yangpu Economic 

Development Zone (QIONGFU {1999} 

No.54),’’ enterprises may receive VAT 

refunds based on level of investment. 

See GSR at 19 and GEQR at 71. The 

program was previously found 

countervailable. See CFS Decision 

Memorandum at 15. 

JHP reported using the program 

during the POI. See GEQR at 71. 

We preliminarily determine that the 

domestic VAT refund confers a 

countervailable subsidy. The refund is a 

financial contribution in the form of 


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Federal Register / Vol. 75, No. 45 / Tuesday, March 9, 2010 / Notices 10787 

18This program was incorrectly listed as an 

income tax program in our Initiation Checklist. 

revenue forgone by the local 

government and it provides a benefit to 

the recipient in the amount of the 

refunded taxes. See section 771(5)(D)(ii) 

of the Act and 19 CFR 351.510(a)(1). We 

further preliminarily determine that the 

program is limited to enterprises located 

in a designated geographical region and, 

hence, is specific under section 

771(5A)(D)(iv) of the Act. 

To calculate the benefit, we treated 

the VAT refund enjoyed by JHP as a 

recurring benefit, consistent with 19 

CFR 351.524(c)(1). We divided the 

amount received during the POI by the 

combined sales of JHP and the Gold 

companies’ paper producers that 

received the inputs from JHP minus 

inter–company sales during the POI. 

On this basis, we preliminarily 

determine that the Gold companies 

received a countervailable subsidy of 

0.40 percent ad valorem under this 

program. 

4. Exemption from City Maintenance 

and Construction Taxes and Education 

Surcharges for FIEs18

SMPI, GEP, GHS, NBZH, NAPP, GZC, 

GLC, GSC, JHP, and JAP stated that FIEs 

are, by law, not subject to these taxes 

and surcharges, and these companies 

reported what they would have paid 

during the POI had they been subject to 

them. See GEQR at 94. Yanzhou 

Tianzhang stated it did not use the 

program during the POI. See YTQR at 

19. 

The GOC reported that FIEs do not 

pay these taxes and surcharges. See 

GQR at 94. In the G1QSR, the GOC 

responded to our follow–up question 

regarding this program stating that 

because FIEs are not subject to these 

taxes and surcharges, they have not 

received an exemption from them. See 

G1SQR at 4. 

We preliminarily determine that the 

exemptions from the city maintenance 

and construction taxes and education 

surcharges confer a countervailable 

subsidy. The exemptions are financial 

contributions in the form of revenue 

forgone by the government and provide 

a benefit to the recipient in the amount 

of the savings. See section 771(5)(D)(ii) 

of the Act and 19 CFR 351.509(a)(1). We 

also determine that the exemptions 

afforded by this program are limited as 

a matter of law to certain enterprises, 

FIEs and, hence, specific under section 

771(5A)(D)(i) of the Act. 

For the paper producing Gold 

companies, we divided the tax savings 

received in the POI by the combined 

sales of the Gold companies’ paper 

producers. For the cross–owned input 

suppliers among the Gold companies, 

we divided the tax savings received in 

the POI by the combined sales of the 

Gold companies’ paper producers that 

received the inputs plus the input 

suppliers’ sales minus inter–company 

sales during the POI. 

As stated above, Yanzhou Tianzhang 

claimed not to use this program during 

the POI. However, proprietary 

information on the record indicates 

otherwise, although that information 

does not allow us to calculate Yanzhou 

Tianzhang’s subsidy. See YTQR at 

Appendix 6. Therefore, as explained 

under the ‘‘Use of Facts Otherwise 

Available and Adverse Inferences’’ 

section above, we have assigned to 

Yanzhou Tianzhang the rate calculated 

for the Gold companies for this 

preliminary determination. We intend 

to seek further information from 

Yanzhou Tianzhang for use in our final 

determination. 

On this basis, we preliminarily 

determine that the Gold companies 

received a countervailable subsidy of 

0.43 percent ad valorem and that 

Yanzhou Tianzhang received a 

countervailable subsidy of 0.43 percent 

ad valorem under this program. 

D. Government Provision of Goods and 

Services for Less than Adequate 

Remuneration 

1. Provision of Electricity 

For the reasons explained in the ‘‘Use 

of Facts Otherwise Available and 

Adverse Facts Available’’ section above, 

we are basing our determination 

regarding the government’s provision of 

electricity in part on adverse facts 

available. 

In a CVD case, the Department 

requires information from both the 

government of the country whose 

merchandise is under investigation and 

the foreign producers and exporters. 

When the government fails to provide 

requested information concerning 

alleged subsidy programs, the 

Department, as adverse facts available, 

typically finds that a financial 

contribution exists under the alleged 

program and that the program is 

specific. See, e.g., Certain Kitchen 

Shelving and Racks from the People’s 

Republic of China: Final Affirmative 

Countervailing Duty Determination, 74 

FR 37012 (July 27, 2009) and 

accompanying Issues and Decision 

Memorandum at 17 ‘‘F. Government 

Provision of Electricity for Less than 

Adequate Remuneration’’ and OCTG 

Decision Memorandum at 22 ‘‘K. 

Provision of Electricity for Less than 

Adequate Remuneration.’’ However, 

where possible, the Department will 

normally rely on the responsive 

producer’s or exporter’s records to 

determine the existence and amount of 

the benefit to the extent that those 

records are useable and verifiable. 

Consistent with this practice, the 

Department finds that the GOC’s 

provision of electricity confers a 

financial contribution, under section 

771(5)(D)(iii) of the Act, and is specific, 

under section 771(5A) of the Act. To 

determine the existence and amount of 

any benefit from this program, we relied 

on the companies’ reported information 

on the amounts of electricity they 

purchased and the amounts they paid 

for electricity during the POI. We 

compared the rates paid by the 

companies who sourced electricity from 

the grid, SMPI, NBZH, NAPP, JHP, JAP, 

JGF, JQZ, JQY, JHF, JSG, YJGS, LZGS, 

GZGS, and WSGWS, to the highest rates 

that they would have paid in the PRC 

during the POI. Specifically, we have 

used the highest peak, valley and 

normal rates for the Gold companies 

based upon their user category. This 

benchmark reflects the adverse 

inference we have drawn as a result of 

the GOC’s failure to act to the best of its 

ability in providing requested 

information about its provision of 

electricity in this investigation. 

On this basis, we preliminarily 

determine that the Gold companies 

received a countervailable subsidy of 

0.14 percent ad valorem under this 

program. The Sun Paper companies did 

not purchase electricity from the 

government grid during the POI. 

Therefore, we preliminarily determine 

that the Sun Paper companies did not 

use this program during the POI. 

II. Programs Preliminarily Determined 

To Be Not Used By Respondents or To 

Not Provide Benefits During the POI 

A. Famous Brands Awards 

GHS reported receiving a famous 

brand award from the local government 

in 2006. See GEQR at 79. 

We preliminarily determine that the 

total amount of the grant was less than 

0.5 percent of the paper–producing Gold 

companies’ sales in 2006. Therefore, we 

have preliminarily expensed the benefit 

in 2006 pursuant to 19 CFR 

351.524(b)(2) and we preliminarily 

determine that the Gold companies 

received no benefit from this program 

during the POI. As a result, we have not 

made a determination with respect to 

whether this program provided a 

countervailable subsidy. 

Based upon responses by the GOC, 

the Gold companies, and the Sun Paper 

companies, we preliminarily determine 


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that the Gold companies and the Sun 

Paper companies did not apply for or 

receive benefits during the POI under 

the programs listed below. 

B. Preferential Lending To The Coated 

Paper Industry 

1. Fast–Growth High–Yield Forestry 

Program Loans 

C. Income Tax Programs 

1. Preferential Tax Policies for 

Technology or Knowledge–Intensive 

FIEs 

2. Preferential Tax Programs for FIEs 

that are High or New Technology 

Enterprises 

3. Income Tax Reductions for High– 

Technology Industries in 

Guangdong Province 

4. Income Tax Credits for 

Domestically Owned Companies 

Purchasing Domestically Produced 

Equipment 

5. Income Tax Exemption Program for 

Export–Oriented FIEs 

6. Corporate Income Tax Refund 

Program for Reinvestment of FIE 

Profits in Export–Oriented 

Enterprises 

D. Grant Programs 

1. Funds for Forestry Plantation 

Construction and Management 

2. The State Key Technologies 

Renovation Project Fund 

3. Loan Interest Subsidies for Major 

Industrial Technology Reform 

Projects in Wuhan 

4. Funds for Water Treatment 

Improvement Projects in the 

Songhuajiang Basin 

5. Special Fund for Energy Saving 

Technology Reform in Wuhan and 

Shouguang Municipality 

6. Clean Production Technology Fund 

E. Economic Development Zone 

Programs 

1. Subsidies in the Nanchang EDZ 

2. Subsidies in the Wuhan EDZ 

3. Subsidies in the Zhenjiang EDZ 

III. Programs for Which More 

Information Is Required 

A. Government Provision of Goods and 

Services for Less than Adequate 

Remuneration 

1. Provision of Papermaking 

Chemicals 

As explained under ‘‘Use of Facts 

Otherwise Available and Adverse 

Inferences,’’ we plan to seek additional 

information, including information 

about the GOC’s ownership 

classifications of the producers of 

papermaking chemicals, other ways in 

which the GOC may influence the 

markets for these papermaking 

chemicals in the PRC, and other 

requested data that the GOC identified 

as ‘‘NA.’’ 

B. Subsidies in the Yangpu EDZ 

The Gold companies reported that 

JHP obtained land–use rights from Dan 

Zhou city authorities, Hainan Yangpu 

Development Company and Hainan 

Yangpu Land Development Company. 

See GEQR at 88 – 90. In the GSR, the 

GOC stated JHP is located in the Yangpu 

EDZ, but did not purchase land–use 

rights from the land administrative 

authority from December 11, 2001 to the 

end of 2008. On February 22, 2010, the 

Gold companies submitted corrections 

and clarifications to their questionnaire 

responses and stated that the land 

obtained from Dan Zhou city is adjacent 

to, but outside of the Yanpu EDZ. See 

GECS at 3 – 4. 

Based on our examination of these 

claims and the proprietary 

documentation regarding these land–use 

rights submitted by the GOC and Gold 

companies, we have found 

inconsistencies that we are unable to 

clarify at this time. See ‘‘Gold 

Companies Preliminary Calculation 

Memorandum’’. Therefore, we intend to 

seek additional information and 

clarification from the Gold companies 

and the GOC following the preliminary 

determination. 

Verification 

In accordance with section 782(i)(1) of 

the Act, we will verify the information 

submitted by Respondents prior to 

making our final determination. 

Suspension of Liquidation 

In accordance with section 

703(d)(1)(A)(i) of the Act, we have 

calculated a rate for each individually 

investigated producer/exporter of the 

subject merchandise. Section 

705(c)(5)(A)(i) of the Act states that for 

companies not investigated, we will 

determine an ‘‘all others’’ rate equal to 

the weighted average countervailable 

subsidy rates established for exporters 

and producers individually 

investigated, excluding any zero and de 

minimis countervailable subsidy rates, 

and any rates determined entirely under 

section 776 of the Act. 

Notwithstanding the language of 

section 705(c)(5)(A)(i) of the Act, we 

have not calculated the ‘‘all others’’ rate 

by weight averaging the rates of GEP 

and Yanzhou Tianzhang, because doing 

so risks disclosure of proprietary 

information. Therefore, we have 

calculated a simple average of the two 

responding firms’ rates. 

We preliminarily determine the total 

estimated net countervailable subsidy 

rates to be: 

Exporter/Manufacturer Net Subsidy 

Rate 

Gold East Paper (Jiangsu) 

Co., Ltd, Gold Huasheng 

Paper Co., Ltd., Gold East 

Trading (Hong Kong) 

Company Ltd., Ningbo 

Zhonghua Paper Co., Ltd., 

and Ningbo Asia Pulp & 

Paper Co., Ltd. .................. 12.83 

Shandong Sun Paper Industry Joint Stock Co., Ltd. 

and Yanzhou Tianzhang 

Paper Industry Co., Ltd. .... 3.92 

All Others .............................. 8.38 

In accordance with sections 

703(d)(1)(B) and (d)(2) of the Act, we are 

directing U.S. Customs and Border 

Protection (‘‘CBP’’) to suspend 

liquidation of all entries of coated paper 

from the PRC that are entered, or 

withdrawn from warehouse, for 

consumption on or after the date of the 

publication of this notice in the Federal 

Register, and to require a cash deposit 

or bond for such entries of merchandise 

in the amounts indicated above. 

ITC Notification 

In accordance with section 703(f) of 

the Act, we will notify the ITC of our 

determination. In addition, we are 

making available to the ITC all non– 

privileged and non–proprietary 

information relating to this 

investigation. We will allow the ITC 

access to all privileged and business 

proprietary information in our files, 

provided the ITC confirms that it will 

not disclose such information, either 

publicly or under an administrative 

protective order, without the written 

consent of the Assistant Secretary for 

Import Administration. 

In accordance with section 705(b)(2) 

of the Act, if our final determination is 

affirmative, the ITC will make its final 

determination within 45 days after the 

Department makes its final 

determination. 

Disclosure and Public Comment 

In accordance with 19 CFR 

351.224(b), we will disclose to the 

parties the calculations for this 

preliminary determination within five 

days of its announcement. Due to the 

anticipated timing of verification and 

issuance of verification reports, case 

briefs for this investigation must be 

submitted no later than one week after 

the issuance of the last verification 

report. See 19 CFR 351.309(c) (for a 

further discussion of case briefs). 

Rebuttal briefs must be filed within five 


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days after the deadline for submission of 

case briefs, pursuant to 19 CFR 

351.309(d)(1). A list of authorities relied 

upon, a table of contents, and an 

executive summary of issues should 

accompany any briefs submitted to the 

Department. Executive summaries 

should be limited to five pages total, 

including footnotes. See 19 CFR 

351.309(c)(2) and (d)(2). 

Section 774 of the Act provides that 

the Department will hold a public 

hearing to afford interested parties an 

opportunity to comment on arguments 

raised in case or rebuttal briefs, 

provided that such a hearing is 

requested by an interested party. See 

also 19 CFR 351.310(c). If a request for 

a hearing is made in this investigation, 

the hearing will be held two days after 

the deadline for submission of the 

rebuttal briefs, pursuant to 19 CFR 

351.310(d), at the U.S. Department of 

Commerce, 14th Street and Constitution 

Avenue, N.W., Washington, D.C. 20230. 

Parties should confirm by telephone the 

time, date, and place of the hearing 48 

hours before the scheduled time. 

Interested parties who wish to request 

a hearing, or to participate if one is 

requested, must submit a written 

request to the Assistant Secretary for 

Import Administration, U.S. Department 

of Commerce, Room 1870, 14th Street 

and Constitution Avenue, N.W., 

Washington, DC 20230, within 30 days 

of the publication of this notice, 

pursuant to 19 CFR 351.310(c). Requests 

should contain: (1) the party’s name, 

address, and telephone; (2) the number 

of participants; and (3) a list of the 

issues to be discussed. Oral 

presentations will be limited to issues 

raised in the briefs. See id. 

This determination is published 

pursuant to sections 703(f) and 777(i) of 

the Act. 

Dated: March 1, 2010. 

Carole A. Showers, 

Acting Deputy Assistant Secretary for Import 

Administration. 

[FR Doc. 2010–5007 Filed 3–8–10; 8:45 am] 

BILLING CODE 3510–DS–S 

COMMITTEE FOR PURCHASE FROM 

PEOPLE WHO ARE BLIND OR 

SEVERELY DISABLED 

Appointments to Performance Review 

Board for Senior Executive Service 

AGENCY: Committee for Purchase From 

People Who Are Blind or Severely 

Disabled. 

ACTION: Appointment of Performance 

Review Board for Senior Executive 

Service. 

SUMMARY: The Committee For Purchase 

from People Who Are Blind Or Severely 

Disabled (Committee) has announced 

the following appointments to the 

Committee Performance Review Board. 

The following individuals are 

appointed as members of the Committee 

Performance Review Board responsible 

for making recommendations to the 

appointing and awarding authorities on 

performance appraisal ratings and 

performance awards for Senior 

Executive Service employees: 

Perry E. Anthony, Ph.D., Deputy 

Commissioner, Rehabilitation 

Services Administration, Department 

of Education. 

Abram Claude, Jr., Private Citizen 

Paul M. Laird, Assistant Director, 

Industries, Education and Vocational 

Training and Chief Operating Officer/ 

FPI, Department of Justice. 

All appointments are made pursuant 

to Section 4314 of Chapter 43 of Title 

5 of the United States Code. 

DATES: Effective Date: March 10, 2010. 

FOR FURTHER INFORMATION CONTACT: 

Patricia Briscoe, Telephone: (703) 603– 

7740, Fax: (703) 603–0655, or e-mail 

CMTEFedReg@abilityone.gov. 

Patricia Briscoe, 

Deputy Director, Business Operations. 

[FR Doc. 2010–4919 Filed 3–8–10; 8:45 am] 

BILLING CODE P 

DEPARTMENT OF DEFENSE 

Office of the Secretary 

Meeting of the Uniform Formulary 

Beneficiary Advisory Panel 

AGENCY: Assistant Secretary of Defense 

(Health Affairs), DoD. 

ACTION: Notice of meeting. 

SUMMARY: Under the provisions of the 

Federal Advisory Committee Act of 

1972 (5 U.S.C., Appendix) and the 

Government in the Sunshine Act of 

1976 (5 U.S.C. 552b) the Department of 

Defense announces that the Uniform 

Formulary Beneficiary Advisory Panel 

(hereafter referred to as the Panel) will 

meet on March 25, 2010. 

DATES: The meeting will be held on 

March 25, 2010, from 8 a.m. to 5 p.m 

and will be open to the public from 9 

a.m. to 5 p.m. 

ADDRESSES: The meeting will be held at 

the Naval Heritage Center Theater, 701 

Pennsylvania Avenue, NW., 

Washington, DC 20004. 

FOR FURTHER INFORMATION CONTACT: 

Lieutenant Colonel Thomas Bacon, 

Designated Federal Officer, Uniform 

Formulary Beneficiary Advisory Panel, 

5111 Leesburg Pike, Skyline 5, Suite 

810, Falls Church, VA 22041–3206, 

Telephone: (703) 681–2890 Fax: (703) 

681–1940, E-mail: 

Baprequests@tma.osd.mil. 

SUPPLEMENTARY INFORMATION: 

Purpose of Meeting 

The Panel will review and comment 

on recommendations made to the 

Director, TRICARE Management 

Activity, by the Pharmacy and 

Therapeutics Committee regarding the 

Uniform Formulary. 

Meeting Agenda 

Sign-In; Welcome and Opening 

Remarks; Public Citizen Comments; 

Scheduled Therapeutic Class Reviews— 

Basal Insulins; Antihemophilic Factors; 

Designated Newly Approved Drugs and 

Drugs recommended for non-formulary 

placement due to non-compliance with 

Fiscal Year 2008, National Defense 

Authorization Act, Section 703; Panel 

Discussions and Vote, and comments 

following each therapeutic class review. 

Meeting Accessibility 

Pursuant to 5 U.S.C. 552b, as 

amended, and 41 CFR 102–3.140 

through 102–3.165, and the availability 

of space this meeting is open to the 

public from 9 a.m. to 5 p.m. Seating is 

limited and will be provided only to the 

first 220 people signing in. All persons 

must sign in legibly. 

Administrative Work Meeting 

Prior to the public meeting the Panel 

will conduct an Administrative Work 

Meeting from 8 a.m. to 9 a.m. to discuss 

administrative matters of the Panel. The 

Administrative Work Meeting will be 

held at the Naval Heritage Center, 701 

Pennsylvania Avenue, NW., 

Washington, DC, 20004. Pursuant to 41 

CFR 102–3.160, the Administrative 

Work Meeting will be closed to the 

public. 

Written Statements 

Pursuant to 41 CFR 102–3.105(j) and 

102–3.140, the public or interested 

organizations may submit written 

statements to the membership of the 

Panel at any time or in response to the 

stated agenda of a planned meeting. 

Written statements should be submitted 

to the Panel’s Designated Federal 

Officer. The Designated Federal 

Officer’s contact information can be 

obtained from the General Services 

Administration’s Federal Advisory 

Committee Act Database—https:// 

www.fido.gov/facadatabase/public.asp. 

Written statements that do not pertain 

to the scheduled meeting of the Panel 


sroberts on DSKD5P82C1PROD with NOTICES