[Federal Register Volume 72, Number 92 (Monday, May 14, 2007)]
[Notices]
[Pages 27074-27076]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E7-9217]


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DEPARTMENT OF COMMERCE

International Trade Administration

A-570-827


Certain Cased Pencils from the People's Republic of China: Final 
Results of Antidumping Duty Administrative Review

AGENCY: Import Administration, International Trade Administration, 
Department of Commerce.
SUMMARY: The Department of Commerce (``the Department'') published its 
preliminary results of administrative review of the antidumping duty 
order on certain cased pencils from the People's Republic of China 
(``PRC'') on December 7, 2006.\1\ The period of review (``POR'') is 
December 1, 2004, through November 30, 2005. We invited interested 
parties to comment on our Preliminary Results. Based on our analysis of 
the comments received, we made certain changes to our calculations. The 
final dumping margins for this review are listed in the ``Final Results 
of Review'' section below.
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    \1\ See Certain Cased Pencils from the People's Republic of 
China; Preliminary Results of Antidumping Duty Administrative 
Review, 71 FR 70949 (December 7, 2006) (``Preliminary Results'').

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EFFECTIVE DATE: May 14, 2007.

FOR FURTHER INFORMATION CONTACT: Magd Zalok or Drew Jackson, AD/CVD 
Operations, Office 4, Import Administration, International Trade 
Administration, U.S. Department of Commerce, 14th Street and 
Constitution Avenue, NW, Washington, DC 20230; telephone: (202) 482-
4162 or (202) 482-4406, respectively.

SUPPLEMENTARY INFORMATION:

Background

    In response to requests by the petitioners,\2\ and several 
exporter/producers, on February 1, 2006, the Department initiated this 
administrative review with respect to the following companies: Beijing 
Dixon Stationery Company Ltd. (``Dixon''), Orient International Holding 
Shanghai Foreign Trade Co., Ltd. (``OIHSFTC''), Shandong Rongxin Import 
and Export Co., Ltd. (``Shandong Rongxin''), Tianjin Custom Wood 
Processing Co., Ltd. (Tianjin), and China First Pencil Company, Ltd. 
and its affiliates, China First Pencil Fang Zheng Co., Shanghai First 
Writing Instrument Co., Ltd., Shanghai Great Wall Pencil Co., Ltd. 
(collectively ``CFP''), and Shanghai Three Star Stationery Industry 
Corp. (``Three Star''\3\).\4\ On August 10, 2006, the Department 
rescinded the instant review with respect to OIHSFTC and Tianjin.\5\
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    \2\ The petitioners include Sanford L.P., Musgrave Pencil 
Company, RoseMoon Inc., and General Pencil Company (collectively 
``the petitioners'').
    \3\ Consistent with prior reviews in this proceeding, the 
Department has treated CFP and Three Star as a single entity (``CFP-
Three Star''). See e.g., Certain Cased Pencils from the People's 
Republic of China; Final Results and Partial Rescission of 
Antidumping Duty Administrative Review, 67 FR 48612, 48613 (July 25, 
2002). This treatment has been upheld by the Court of International 
Trade. See China First Pencil Co. Ltd. v. United States, 427 F. Supp 
2d 1236 (March 7, 2006).
    \4\ See Initiation of Antidumping and Countervailing Duty 
Administrative Reviews and Request for Revocation in Part, 71 FR 
5241 (February 1, 2006).
    \5\ See Certain Cased Pencils from the People's Republic of 
China: Notice of Partial Rescission of Antidumping Duty 
Administrative Review, 71 FR 47169 (August 16, 2006).
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    On December 7, 2006, the Department published the Preliminary 
Results of this review in the Federal Register. The following events 
occurred after the Department published the Preliminary

[[Page 27075]]

Results. In response to a supplemental questionnaire, CFP-Three Star 
submitted additional factual information to the Department on December 
15, 2006. In response to an invitation to comment on the Preliminary 
Results, the petitioners, CFP-Three Star, and Dixon submitted case 
briefs to the Department on January 22, 2007. The petitioners and CFP-
Three Star submitted rebuttal briefs to the Department on January 29, 
2007. During January 2007, the petitioners, CFP-Three Star, and Dixon 
filed additional surrogate information with the Department. On February 
2, 2007, the Department gave interested parties an opportunity to 
comment on the most recently calculated wage rate posted on the 
Department's website. CFP-Three Star responded to this opportunity by 
submitting comments to the Department on February 7, 2007.
    We have conducted this administrative review in accordance with 
Section 751 of the Tariff Act of 1930, as amended (``the Act''), and 19 
CFR 351.213.

Period of Review

    The POR is December 1, 2004, through November 30, 2005.

Scope of the Order

    Imports covered by this order are shipments of certain cased 
pencils of any shape or dimension (except as described below) which are 
writing and/or drawing instruments that feature cores of graphite or 
other materials, encased in wood and/or man-made materials, whether or 
not decorated and whether or not tipped (e.g., with erasers, etc.) in 
any fashion, and either sharpened or unsharpened. The pencils subject 
to the order are currently classifiable under subheading 9609.10.00 of 
the Harmonized Tariff Schedule of the United States (``HTSUS''). 
Specifically excluded from the scope of the order are mechanical 
pencils, cosmetic pencils, pens, non-cased crayons (wax), pastels, 
charcoals, chalks, and pencils produced under U.S. patent number 
6,217,242, from paper infused with scents by the means covered in the 
above-referenced patent, thereby having odors distinct from those that 
may emanate from pencils lacking the scent infusion. Also excluded from 
the scope of the order are pencils with all of the following physical 
characteristics: (1) length: 13.5 or more inches; (2) sheath diameter: 
not less than one-and-one quarter inches at any point (before 
sharpening); and (3) core length: not more than 15 percent of the 
length of the pencil.
    In addition, pencils with all of the following physical 
characteristics are excluded from the scope of the order: novelty jumbo 
pencils that are octagonal in shape, approximately ten inches long, one 
inch in diameter before sharpening, and three-and-one eighth inches in 
circumference, composed of turned wood encasing one-and-one half inches 
of sharpened lead on one end and a rubber eraser on the other end.
    Although the HTSUS subheading is provided for convenience and 
customs purposes, the written description of the scope of the order is 
dispositive.

Analysis of Comments Received

    All issues raised in the parties' case and rebuttal briefs 
commenting on this administrative review are addressed in the 
memorandum from Stephen J. Claeys, Deputy Assistant Secretary for 
Import Administration, to David M. Spooner, Assistant Secretary for 
Import Administration, ``Issues and Decision Memorandum for the Final 
Results of the 2004-2005 Administrative Review of the Antidumping Duty 
Order on Certain Cased Pencils from the People's Republic of China,'' 
which is dated concurrently with, and hereby adopted by, this notice 
(``Issues and Decision Memorandum''). A list of the issues that parties 
have raised and to which we have responded, all of which are in the 
Issues and Decision Memorandum, is attached to this notice as an 
Appendix. Parties can find a complete discussion of all issues raised 
in this review, and the corresponding recommendations, in the public 
Issues and Decision Memorandum that is on file in the Central Records 
Unit, Room B-099 of the main Department of Commerce building. In 
addition, a complete version of the Issues and Decision Memorandum can 
be accessed directly on the internet at http://ia.ita.doc.gov/frn/index.html. The paper copy and electronic version of the Issues and 
Decision Memorandum are identical in content.

Changes Since the Preliminary Results

    Based on our analysis of the comments received, we made the 
following changes in calculating dumping margins: (1) we adjusted the 
surrogate value for slats to reflect wood loss in producing slats from 
lumber; (2) we valued labor using the most recently calculated wage 
rate found on the Department's website; and (3) we valued brokerage and 
handling services using a different surrogate source. In addition, 
based on the additional information provided by CFP-Three Star in its 
December 15, 2006 submission, we recalculated supplier distances for 
foil and erasers. For further details, see the ``CFP-Three Star 
Calculation Memorandum for Final Results of Administrative Review,'' 
dated May 7, 2007.

Surrogate Country

    In the Preliminary Results, we stated that we treat the PRC as a 
non-market economy (``NME'') country and, therefore, we calculated 
normal value in accordance with section 773(c) of the Act, which 
applies to NME countries. Also, we stated that we selected India as the 
appropriate surrogate country to use in this review for the following 
reasons: (1) it is a significant producer of merchandise comparable to 
subject merchandise; and (2) it is at a level of economic development 
comparable to the PRC, pursuant to section 773(c)(4) of the Act. See 
Preliminary Results, 71 FR at 70953-70954. For the final results of 
review, we have continued to use the same surrogate country that we 
used in the Preliminary Results.

Separate Rates

    In proceedings involving NME countries, the Department begins with 
a rebuttable presumption that all companies within the country are 
subject to government control and, thus, should be assigned a single 
antidumping duty deposit rate. It is the Department's policy to assign 
all exporters of merchandise subject to review in an NME country this 
single rate unless an exporter can demonstrate that it is sufficiently 
independent so as to be entitled to a separate rate.
    In the Preliminary Results, we found that Dixon, Shandong Rongxin, 
and the collapsed entity CFP-Three Star demonstrated their eligibility 
for separate-rate status. In these final results of review, we continue 
to find that the evidence placed on the record of this review by the 
above-referenced companies demonstrates an absence of government 
control, both in law and in fact, with respect to their exports of the 
merchandise under review. Thus, we have determined that Dixon, Shandong 
Rongxin, and CFP-Three Star are eligible for separate-rates.

Final Results of Review

    We determine that the following weighted-average dumping margins 
exist for the period December 1, 2004, through November 30, 2005:

[[Page 27076]]



------------------------------------------------------------------------
           Manufacturer/exporter                  Margin (percent)
------------------------------------------------------------------------
China First Pencil Company, Ltd...........                          2.66
(which includes its affiliates China First                          2.66
 Pencil Fang Zheng Co.,...................
Shanghai First Writing Instrument Co.,                              2.66
 Ltd.,....................................
Shanghai Great Wall Pencil Co., Ltd., and.                          2.66
Shanghai Three Star Stationery Industry                             2.66
 Corp.)\6\................................
Beijing Dixon Stationery Company, Ltd.....                          2.66
Shandong Rongxin Import & Export Co., Ltd.                         2.66
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\6\ As noted in the Preliminary Results for this review, we have
  determined China First Pencil Company, Ltd., China First Pencil Fang
  Zheng Co., Shanghai First Writing Instrument Co., Ltd., Shanghai Great
  Wall Pencil Co., Ltd., and Shanghai Three Star Stationery Industry
  Corp. constitute a single entity. See also Certain Cased Pencils from
  the People's Republic of China; Final Results and Partial Rescission
  of Antidumping Duty Administrative Review, 70 FR 42301 (July 22, 2005)
  (no change in amended final determination).

Assessment Rates

    The Department has determined, and U.S. Customs and Border 
Protection (``CBP'') shall assess, antidumping duties on all 
appropriate entries. For CFP-Three Star, we calculated customer-
specific antidumping duty assessment amounts based on the ratio of the 
total amount of antidumping duties calculated for the examined sales of 
subject merchandise to the total quantity of subject merchandise sold 
in those transactions. We calculated assessment amounts in this 
fashion, as opposed to calculating importer-specific ad valorem rates 
in accordance with 19 CFR 351.212(b)(1), because the entered values and 
importers of record for CFP-Three Star's reported U.S. sales are not on 
the record. Where the customer-specific assessment rate is above de 
minimis, we will instruct CBP to assess the customer-specific rate 
uniformly on the entered customs value of all POR entries of subject 
merchandise sold to the customer. To determine whether the per-unit 
duty assessment rates were de minimis (i.e., less than 0.50 percent ad 
valorem), in accordance with the requirement set forth in 19 CFR 
351.106(c)(2), we calculated customer-specific ad valorem ratios based 
on the export prices. For Dixon and Shandong Rongxin (respondents that 
are being assigned the dumping margin calculated for CFP-Three Star), 
we will instruct CBP to assess antidumping duties on entries of 
merchandise from these companies equal to the dumping margin these 
companies have received in these final results of review, regardless of 
the importer of, or customer who purchased, their subject merchandise. 
The Department intends to issue assessment instructions to CBP 15 days 
after the date of publication of the final results of this review.

Cash-Deposit Requirements

    The following deposit requirements will apply to all shipments of 
certain cased pencils from the PRC entered, or withdrawn from 
warehouse, for consumption on or after the publication date of this 
notice of final results of administrative review, as provided by 
section 751(a)(1) of the Act: (1) the cash deposit rates for the 
companies listed in the ``Final Results of Review'' section above will 
be the rates for those firms established in the final results of this 
administrative review; (2) for any previously reviewed or investigated 
PRC or non-PRC exporter, not covered in this review, with a separate 
rate, the cash deposit rate will be the company-specific rate 
established in the most recent segment of this proceeding; (3) for all 
other PRC exporters, the cash deposit rate will be the PRC-wide rate, 
which is 114.9 percent; and (4) the cash deposit rate for any non-PRC 
exporter of subject merchandise from the PRC will be the rate 
applicable to the PRC exporter that supplied that exporter. These cash 
deposit requirements shall remain in effect until further notice.

Reimbursement of Duties

    This notice serves as a final reminder to importers of their 
responsibility under 19 CFR 351.402(f)(2) to file a certificate 
regarding the reimbursement of antidumping duties prior to liquidation 
of the relevant entries during this review period. Failure to comply 
with this requirement could result in the Secretary's presumption that 
reimbursement of the antidumping duties occurred and the subsequent 
assessment of double antidumping duties.

Administrative Protective Orders

    This notice also serves as a reminder to parties subject to 
administrative protective orders (``APO'') of their responsibility 
concerning the return or destruction of proprietary information 
disclosed under APO in accordance with 19 CFR 351.305. Timely written 
notification of the return/destruction of APO materials or conversion 
to judicial protective order is hereby requested. Failure to comply 
with the regulations and terms of an APO is a violation which is 
subject to sanction.
    We are issuing and publishing this determination and notice in 
accordance with sections 751(a)(1) and 777(i)(1) of the Act.

    Dated: May 3, 2007.
David M. Spooner,
Assistant Secretary for Import Administration.

APPENDIX

List of Issues in the Issues and Decision Memorandum

Comment 1: Whether the Department Used the Appropriate Size of Lumber 
as a Surrogate for Pencil Slats
Comment 2: Whether the Department Should Adjust the Pencil Slat 
Surrogate Value to Account for Wood Loss
Comment 3: Whether the Department Should Use the Price of Kiln-Dried or 
Green Lumber to Value Pencil Slats
Comment 4: Whether the Department Used the Appropriate Surrogate 
Financial Ratios
Comment 5: Whether the Department Properly Accounted for Labor-Related 
Expenses in Calculating Financial Ratios
Comment 6: Whether the Department Used an Appropriate Labor Rate
Comment 7: Whether the Department Used an Appropriate Surrogate Value 
for Brokerage and Handling Services
Comment 8: Whether the Department Used an Appropriate Surrogate Value 
for Paper Wrap
Comment 9: Selection of the Appropriate Rate to Assign to a Separate 
Rate/Section A Respondent
[FR Doc. E7-9217 Filed 5-11-07; 8:45 am]
BILLING CODE: 3510-DS-S