Federal Register / Vol. 60, No. 87 / Friday, May 5, 1995 / Notices 22359

Number 0693–0010, 0348–0043, and

0348–0044).

It has been determined that this rule

is not significant for purposes of EO

12866.

Program Execution

(a) Cooperative Agreement. The

formal agreement between NIST and the

applicant will be in the form of a

Cooperative Agreement.

(b) Project Work Plan. All recipients

of awards are required to submit a Work

Plan within thirty (30) days of the

project start date. The work plan is a

more detailed statement of work based

on project objectives and activities the

recipient will undertake to achieve the

objectives and incorporates

recommendations provided by the

evaluation panel and the NIST Program

Officer. The Work Plan must be

reviewed and approved by NIST and

will be incorporated into the

cooperative agreement by amendment.

Work Plan guidelines will be distributed

to award recipients.

(c) Project Reporting. Quarterly

reports will be submitted to the NIST

Program Manager no later than thirty

(30) days after the end of each quarter

of the award year. The information

provided is used to characterize the

projects, develop detailed case studies,

and evaluate individual examples of

outcomes. Quarterly reporting

instructions will be distributed to award

recipients.

(d) Program Plan. A Program Plan will

be submitted to the NIST Program

Manager no later than thirty (30) days

after the end of the award period. The

Program Plan will discuss how the state

will work with industry to develop a

program that coordinates and

supplements state resources for

industrial modernization. The Plan

must, at a minimum: characterize the

industry in the state and survey their

needs; identify and assess the relevance

and sophistication of existing

modernization resources; and develop a

plan for a state-wide industrial

modernization infrastructure that

coordinates and complements existing

relevant services and eliminates

duplication. Program plans must be

driven by industry needs. Program Plan

guidelines will be distributed to award

recipients.

Dated: May 1, 1995.

Samuel Kramer,

Associate Director.

[FR Doc. 95–11123 Filed 5–4–95; 8:45 am]

BILLING CODE 3510–13–M

International Trade Administration

[A–570–834]

Notice of Final Determination of Sales

at Less Than Fair Value: Disposable

Pocket Lighters From the People’s

Republic of China

AGENCY: Import Administration,

International Trade Administration,

Department of Commerce.

EFFECTIVE DATE: May 5, 1995.

FOR FURTHER INFORMATION CONTACT: Julie

Anne Osgood or Todd Hansen, Office of

Countervailing Investigations, Import

Administration, International Trade

Administration, U.S. Department of

Commerce, 14th Street and Constitution

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

telephone: (202) 482–0167 or (202) 482–

1276, respectively.

Final Determination

We determine that disposable pocket

lighters from the People’s Republic of

China (‘‘PRC’’) are being, or are likely to

be, sold in the United States at less than

fair value (‘‘LTFV’’), as provided in

section 735 of the Tariff Act of 1930, as

amended (‘‘the Act’’). The estimated

margins are shown in the ‘‘Continuation

of Suspension of Liquidation’’ section of

this notice. The U.S. Department of

Commerce (‘‘the Department’’) also

determines that critical circumstances

exist for all exporters except Gao Yao

(HK) Hua Fa Industrial Company Ltd.

(‘‘Gao Yao’’), Guangdong Light

Industrial Products Import & Export

Corporation (‘‘GLIP’’) and PolyCity

Industrial Limited (‘‘PolyCity’’).

Applicable Statute and Regulations

Unless otherwise indicated, all

citations to the statute and to the

Department’s regulations are references

to the provisions as they existed on

December 31, 1994.

Case History

Since the preliminary determination

on December 5, 1994, (Notice of

Preliminary Determination of Sales at

Less Than Fair Value: Disposable Pocket

Lighters from the People’s Republic of

China, 59 FR 64191 (December 13,

1994)), the following events have

occurred:

On December 23, 1994, we issued our

preliminary determination of critical

circumstances with respect to the

subject merchandise (60 FR 436, January

4, 1995).

On December 9 and December 19,

1994, Cli-Claque Company Limited

(‘‘Cli-Claque’’), China National Overseas

Trading Corporation (‘‘COTCO’’), Gao

Yao and GLIP, requested a

postponement of the final

determination, pursuant to 19 CFR

353.20. Accordingly, on January 20,

1995, the deadline for the final

determination was extended to April 27,

1995 (60 FR 5899, January 31, 1995).

From February 28 through March 17,

1995, we verified the responses of the

exporters and producers of disposable

lighters.

Petitioner and respondents filed case

briefs on April 6, 10, 11, and 12, and

rebuttal briefs on April 13 and 14, 1995.

A public hearing was held on April 17,

1995.

Scope of Investigation

The products covered by this

investigation are disposable pocket

lighters (‘‘lighters’’), whether or not

refillable, whose fuel is butane,

isobutane, propane, or other liquefied

hydrocarbon, or a mixture containing

any of these, whose vapor pressure at 75

degrees fahrenheit (24 degrees Celsius)

exceeds a gauge pressure of 15 pounds

per square inch. Non-refillable pocket

lighters are imported under subheading

9613.10.0000 of the Harmonized Tariff

Schedule of the United States

(‘‘HTSUS’’). Refillable, disposable

pocket lighters would be imported

under subheading 9613.20.0000.

Although the HTSUS subheadings are

provided for convenience and Customs

purposes, our written description of the

scope of this proceeding is dispositive.

Certain windproof refillable lighters,

as described in memoranda to Barbara

R. Stafford, dated December 5, 1994,

and April 25, 1995, are excluded from

the scope of this investigation. Also,

excluded from the scope of this

investigation are electric lighters (as

described in the April 25, 1995 memo)

which use two AA batteries to heat a

coil for purposes of igniting smoking

materials, rather than using butane,

isobutane, propane, or other liquefied

hydrocarbon to fuel a flame for purposes

of igniting smoking materials.

Period of Investigation

The period of investigation (‘‘POI’’) is

December 1, 1993 through May 31,

1994.

Non-market Economy Status

The PRC has been treated as a nonmarket economy country (‘‘NME’’) in

past antidumping investigations (see,

e.g., Final Determination of Sales at Less

Than Fair Value: Saccharin from the

People’s Republic of China, 59 FR 58818

(November 15, 1994) (‘‘Saccharin’’). No

information has been provided in this

proceeding that would lead us to

overturn our former determinations.

Therefore, in accordance with section
22360 Federal Register / Vol. 60, No. 87 / Friday, May 5, 1995 / Notices

1Evidence supporting, though not requiring, a

finding of de jure absence of central control

includes: (1) an absence of restrictive stipulations

associated with an individual exporter’s business

and export licenses; (2) any legislative enactments

decentralizing control of companies; or (3) any

other formal measure by the government

decentralizing control of companies.

771(18)(c) of the Act, we are continuing

to treat the PRC as an NME for purposes

of this investigation.

Separate Rates

All five of the responding companies

in this investigation have requested

separate antidumping duty rates. In

cases involving NMEs, the Department’s

policy is to assign a separate rate only

when an exporter can demonstrate the

absence of both de jure and de facto

governmental control over export

activities.

In this case, two of the five

respondents, PolyCity and Cli-Claque,

are Hong Kong companies that are

involved in joint ventures in the PRC

that manufacture disposable lighters.

Since PolyCity and Cli-Claque are

located outside the PRC, the PRC

government does not have jurisdiction

over them. Moreover, the PRC

government does not have any

ownership interest in these exporters

and, therefore, it cannot exercise control

through ownership of these companies.

On this basis, we determine that there

is no need to apply our separate rates

analysis to these two companies and

that PolyCity and Cli-Claque are entitled

to individual rates.

In contrast to PolyCity and Cli-Claque,

Gao Yao is a 50/50 joint venture

between a Chinese company, owned ‘‘by

all the people,’’ and a Hong Kong

company. The joint venture owns both

the production and export facilities

used to manufacture and export the

disposable lighters it sells to the United

States. Given the direct PRC ownership

in Gao Yao’s export operations, we have

determined that it is appropriate to

apply our separate rates analysis to this

company.

Of the remaining companies, COTCO

and GLIP indicated that they were

owned ‘‘by all the people’’ during the

POI. As stated in the Final

Determination of Sales at Less than Fair

Value: Silicon Carbide from the PRC, 59

FR 22585 (May 2, 1994) (‘‘Silicon

Carbide’’), ‘‘ownership of a company by

all the people does not require the

application of a single rate.’’

Accordingly, COTCO and GLIP are

eligible for consideration for a separate

rate under our criteria.

Although GLIP was owned during the

POI by ‘‘all the people,’’ after the POI it

became a shareholding company whose

shares are held by a variety of investors.

GLIP received approval to become a

shareholding company in March 1994,

but issued shares after the POI. A

portion of the company’s shares

representing the initial investment in

the company are held in trust by the

State Asset Management Bureau

(‘‘SAMB’’). However, the record of the

investigation indicates that the SAMB

has entrusted voting rights of its shares

to the management of the company. In

past cases involving similar

circumstances, we found that the

granting of a separate rate to the

responding exporters was not

precluded. (See, e.g., Final

Determination of Sales at Less Than

Fair Value: Certain Cased Pencils from

the People’s Republic of China, 59 FR

55625 (November 8, 1994), and Final

Determination of Sales at Less than Fair

Value: Certain Paper Clips from the

People’s Republic of China, 59 FR

511680 (October 7, 1994).) As stated

above, we have applied our separate

rates analysis to GLIP.

To establish whether a firm is entitled

to a separate rate, the Department

analyzes each exporting entity under a

test arising out of the Final

Determination of Sales at Less Than

Fair Value: Sparklers from the PRC, 56

FR 20588 (May 6, 1991) (‘‘Sparklers’’)

and amplified in Silicon Carbide. Under

the separate rates criteria, the

Department assigns separate rates only

where respondents can demonstrate the

absence of both de jure and de facto

governmental control over export

activities.

1. Absence of de Jure 1 Control

The respondents submitted a number

of documents to demonstrate absence of

de jure control, including two PRC laws

indicating that the responsibility for

managing enterprises owned by ‘‘all the

people’’ is with the enterprises

themselves and not with the

government. These are the ‘‘Law of the

People’s Republic of China on Industrial

Enterprises Owned by the Whole

People,’’ adopted on April 13, 1988

(‘‘1988 Law’’); and the ‘‘Regulations for

Transformation of Operational

Mechanism of State-Owned Industrial

Enterprises,’’ approved on August 23,

1992 (‘‘1992 Regulations’’).

Respondents’ submission also included

the ‘‘Temporary Provisions for

Administration of Export

Commodities,’’ approved on December

21, 1992 (‘‘Export Provisions’’). In April

1994, the State Council enacted the

‘‘Emergent Notice of Changes in Issuing

Authority for Export Licenses Regarding

Public Quota Bidding for Certain

Commodities’’ (Quota Measures).

The 1988 Law and 1992 Regulations

shifted control of companies owned ‘‘by

all the people’’ from the government to

the enterprises themselves. The 1988

Law provides that enterprises owned by

‘‘all the people’’ shall make their own

management decisions, be responsible

for their own profits and losses, choose

their own suppliers and purchase their

own goods and materials. The 1988 Law

contains other provisions which

indicate that enterprises have

management independence from the

government. The 1992 Regulations

provide that these same enterprises can,

for example, set their own prices

(Article IX); make their own production

decisions (Article XI); use their own

retained foreign exchange (Article XII);

allocate profits (Article II); sell their

own products without government

interference (Article X); make their own

investment decisions (Article XIII);

dispose of their own assets (Article XV);

and hire and fire employees without

government approval (Article XVII). The

Export Provisions indicate those

products that may be subject to direct

government control. Lighters do not

appear on the Export Provisions list nor

on the Quota Measures list and are not,

therefore, subject to export constraints.

Since GLIP was initially a company

owned by ‘‘all the people,’’ the laws

cited above establish that the

government devolved control over such

companies. The only additional law that

is pertinent to the de jure analysis of

GLIP as a share company is the

Company Law (effective July 1, 1994).

While GLIP indicated that it is now

organized consistent with the Company

Law, the law did not enter into force

until two months after the POI. In any

event, this law does not alter the

government’s de jure devolution of

control that occurred when the

company was owned ‘‘by all the

people.’’ Therefore, we have determined

that GLIP is not subject to de jure

control.

Consistent with Silicon Carbide, we

determine that the existence of these

laws demonstrates that COTCO, GLIP,

and Gao Yao are not subject to de jure

central government control with respect

to export sales and pricing decisions.

However, there is some evidence that

the provisions of the above-cited laws

and regulations have not been

implemented uniformly among different

sectors and/or jurisdictions in the PRC

(see ‘‘PRC Government Findings on

Enterprise Autonomy,’’ in Foreign

Broadcast Information Service-China93–133 (July 14, 1993)). Therefore, the

Department has determined that a de

facto analysis is critical to determine

whether COTCO, Gao Yao and GLIP are
Federal Register / Vol. 60, No. 87 / Friday, May 5, 1995 / Notices 22361

subject to governmental control over

export sales and pricing decisions.

2. Absence of de Facto Control

The Department typically considers

four factors in evaluating whether a

respondent is subject to de facto

government control of its export

functions: (1) whether the export prices

are set by, or subject to the approval of,

a governmental authority; (2) whether

the respondent has authority to

negotiate and sign contracts and other

agreements; (3) whether the respondent

has autonomy from the government in

making decisions regarding the

selection of management; and (4)

whether the respondent retains the

proceeds of its export sales and makes

independent decisions regarding

disposition of profits or financing of

losses (see Silicon Carbide).

During the verification proceedings,

Department officials viewed evidence in

the form of sales documents, company

correspondence, and bank statements,

and confirmed through inquiries of

company representatives and officials

from the China Chamber of Commerce

for Machinery and Electronic Products

Import & Export (‘‘CCCME’’), that

COTCO, GLIP, and Gao Yao:

• Maintain their own bank accounts,

including foreign exchange accounts;

• Are not restricted in their access to

their bank accounts;

• Make independent business

decisions, based on market conditions;

• Set their own prices independently

and that the prices are not subject to

review by government authorities;

• Are not subject to foreign exchange

targets set by either the central or

provincial governments; and

• Have the ability to sell, transfer, or

acquire assets.

Exporter-Specific Information

Gao Yao

• Is a Sino-Hong Kong 50–50 joint

venture whose Chinese participant is a

company owned by ‘‘all the people’’;

• Maintains a bank account in Hong

Kong where all monies received from

Gao Yao’s foreign sales are deposited;

• Has management that is selected by

the board of directors, without any

governmental interference;

• Divides its profits evenly between

the joint venture partners according to

ownership participation; and

• Retains a general manager who is a

Hong Kong resident.

GLIP

• Is owned by ‘‘all the people’’ during

the POI, but became a shareholding

company in July 1994;

• Has management that is selected by

its board of directors;

• Selection and continued

employment of management is not

subject to government approval;

• May issue additional shares through

the company’s board of directors with

the approval of shareholders; and

• Government contact was limited to

the issuance of GLIP’s shareholding

license and a general notice pertaining

to penalties for illegal exporting.

COTCO

• Is owned by ‘‘all the people’’;

• Has managers that are hired

following public notices of vacancy,

screening, and hiring negotiations; and

• Has management that is evaluated

by the employees of the company. The

selection and promotion of management

are not subject to any governmental

entity’s review or approval.

Based on the record evidence as

verified, we find that there is a de facto

absence of governmental control of

export functions of each of the three

companies. Consequently, COTCO, Gao

Yao and GLIP have been granted

separate rates in our final

determination.

Surrogate Country

Section 773(c)(4) of the Act requires

that the Department value the NME

producers’ factors of production, to the

extent possible, in one or more market

economy countries that are (1) at a level

of economic development comparable to

that of the NME country, and (2)

significant producers of comparable

merchandise. The Department has

determined that Indonesia is the most

suitable surrogate for purposes of this

investigation. Based on available

statistical information, Indonesia is at a

level of economic development

comparable to that of the PRC, and is a

significant producer of lighters (see,

memorandum to the file from Todd

Hansen, dated December 5, Surrogate

Country Selection and memorandum

from David Mueller to Susan Kuhbach,

dated September 8, 1994, Lighters from

the People’s Republic of China and

Surrogate Country Selection.)

Fair Value Comparisons

To determine whether sales of lighters

from the PRC to the United States by

respondents were made at less than fair

value, we compared the United States

price (‘‘USP’’) to the foreign market

value (‘‘FMV’’), as specified in the

‘‘United States Price’’ and ‘‘Foreign

Market Value’’ sections of this notice.

United States Price

For all respondents, we based USP on

purchase price, in accordance with

section 772(b) of the Act, because

lighters were sold directly to unrelated

parties in the United States prior to

importation into the United States and

because exporters sales price

methodology was not otherwise

indicated.

We calculated purchase price based

on packed, FOB foreign port prices for

unrelated purchasers in the United

States and packed, CIF prices, where

appropriate. We made deductions for

discounts, foreign inland freight,

containerization, loading, port handling

expenses, ocean freight and marine

insurance, as indicated. When these

services were purchased from a market

economy supplier and paid for in a

market economy currency, we used the

actual cost. Otherwise, these charges

were valued in the surrogate country. In

addition, we have relied upon a price

quote provided by an unrelated Hong

Kong company to value freight in those

instances where Cli-Claque used a

related trucking company for the

delivery of finished lighters.

At the request of the Department, on

March 22 and 23, 1995, PolyCity and

Cli-Claque submitted revised U.S. sales

and factors of production information to

reflect minor changes due to errors

noted at verification. In addition,

PolyCity revised: the U.S. sales listing to

include additional sales that had been

inadvertently omitted (see Comment 8);

foreign inland freight to include

additional charges incurred at the

border; marine insurance and foreign

brokerage and handling to reflect costs

incurred on a value basis rather than a

per piece basis; and ocean freight to

reflect additional charges on certain

invoices and payment in Hong Kong

dollars rather than U.S. dollars. CliClaque’s submission included small

number of additional sales which had

been inadvertently omitted and

revisions to foreign inland freight

figures on deliveries of finished lighters

and purchases of inputs. Pursuant to

findings at verification, minor revisions

were made to COTCO’s sales price. For

Gao Yao, we adjusted USP for port

handling charges that had been paid in

a market economy currency to a Hong

Kong company.

Foreign Market Value

In accordance with section 773(c) of

the Act, we calculated FMV based on

factors of production reported by the

factories in the PRC which produced the

subject merchandise for the five

responding exporters. The factors used
22362 Federal Register / Vol. 60, No. 87 / Friday, May 5, 1995 / Notices

to produce lighters include materials,

labor, and energy. To calculate FMV, the

reported factor quantities were

multiplied by the appropriate surrogate

values from Indonesia for those inputs

purchased domestically from PRC

suppliers. Where inputs were imported

from market economy countries and

paid in a market economy currency, we

used the actual costs incurred by the

producers to value these factors (see,

e.g. Final Determination of Sales at Less

Than Fair Value: Oscillating Ceiling

Fans from the People’s Republic of

China, 56 FR 55271, October 25, 1991).

We adjusted these input prices to make

them delivered prices. We then added

amounts for overhead, general expenses

and profit, the cost of containers and

coverings, and other expenses incident

to placing the merchandise in condition

packed and ready for shipment to the

United States.

In addition, we have made the

following changes to our preliminary

calculations:

• For PolyCity, we valued certain

inputs purchased from market-economy

sources with market-economy currency

using invoices dated outside the POI.

For inputs that were not purchased from

market-economy sources with marketeconomy currency, we used surrogate

values (see Comment 11).

• For Cli-Claque, we calculated

foreign inland freight based on verified

distances for packing materials and

finished lighters. In addition, we have

relied upon a price quote provided by

an unrelated Hong Kong company to

value freight in those instances where

Cli-Claque used a related trucking

company for the delivery of imported

inputs. We have adjusted direct labor

hours to reflect verified information.

Finally, to value the packing trays

which were made by a factory located

in the PRC with imported inputs, we

have used surrogate values.

• For GLIP, we adjusted labor hours,

butane usage, electricity usage, certain

lighter parts and packing materials to

reflect verified information. Also, we

adjusted the prices paid to market

economy suppliers based on verified

information.

• For Gao Yao, we used surrogate

values for inputs that we verified were

purchased from PRC suppliers, but had

originally been reported as purchased

from market economy suppliers. We

adjusted waste and electricity figures to

reflect verified information. In addition,

certain consumption figures were

changed from a per kilogram basis to a

per-piece basis. Finally, the weights of

certain lighter parts were changed due

to findings at verification.

• For COTCO, we adjusted labor

hours and consumption of certain raw

materials to reflect verified information.

We also adjusted the weights of certain

lighter parts and packing materials

based on verified information.

In determining the surrogate price to

be used for valuing the remaining

factors of production, we selected, when

available, publicly available published

information (‘‘public information’’) from

Indonesia.

With the exception of butane, we used

the Indonesian import prices taken from

the Indonesian Foreign Trade Statistical

Bulletin—Imports, December 1993 and

April 1994 to value material inputs.

Based on discussions with U.S. Customs

officials (see Memorandum to the File

from Todd Hansen, dated April 26,

1995, Appropriate HAS Numbers), we

have changed certain surrogate values to

more accurately reflect the cost of the

input used.

For butane, the quantity imported into

Indonesia was insignificant. Therefore,

for those PRC producers that did not

import butane from market economy

sources, we relied on Indonesian export

statistics, as reported in the Indonesian

Foreign Trade Statistical Bulletin—

Exports, December 1993 and April 1994.

We used Indonesian transportation

rates taken from a September 18, 1991,

U.S. State Department cable from the

U.S. Embassy in Indonesia to value

inland freight between the source of the

factor and the disposable lighter factory.

To value electricity, we used the

public information from the Electric

Utilities Data Book for Asian and Pacific

Region (January 1993) published by the

Asian Development Bank. To value

labor amounts, we have used figures for

skilled and unskilled labor obtained

from Doing Business in Indonesia (1991)

and the International Labor Office’s

1994 Special Supplement to the Bulletin

of Labor Statistics. We have determined

that these figure more accurately

represent hourly wage rates paid in

Indonesia than the rate provided in the

Department of Labor’s ‘‘Foreign Labor

Trends,’’ which was the rate used in the

preliminary determination.

We adjusted the factor values, when

necessary, to the POI using wholesale

price indices (‘‘WPIs’’) published by the

International Monetary Fund (‘‘IMF’’).

Because we were unable to locate

appropriate information on factory

overhead in Indonesia, we relied upon

data published by the Reserve Bank of

India pertaining to Manufacturing—

metals, chemicals, and products thereof.

Because this figure includes indirect

expenses and water, we have not

calculated separate costs for these

inputs.

For general expense percentages, we

also used the Reserve Bank of India

data. For profit, we used the statutory

minimum of eight percent of materials,

labor, factory overhead, and general

expenses. We could not obtain

Indonesian values for either general

expenses or profit. The Indian profit rate

was less than the statutory minimum of

eight percent.

We added packing based on

Indonesian values obtained from the

Indonesian Foreign Trade Statistical

Bulletin—Imports, December 1993 and

April 1994.

Best Information Available (BIA)

In this investigation, some PRC

exporters failed to respond to our

questionnaire. We have determined that

those exporters should receive rates

based on BIA. In addition, because we

presume all exporters to be centrally

controlled, absent verified information

to the contrary, in accordance with

section 776(c) of the Act, we have

assigned a margin based on BIA to all

exporters who have not demonstrated

their independence from central control.

This determination is consistent with

our use of a BIA-based ‘‘PRC-Wide’’ rate

in other recent investigations (see e.g.,

Saccharin).

In determining what to use as BIA, the

Department follows a two-tiered

methodology, whereby the Department

normally assigns less adverse margins to

those respondents that cooperated in an

investigation and more adverse margins

for those respondents that did not

cooperate in an investigation. As

outlined in the Antifriction Bearings

(Other than Tapered Roller Bearings)

and Parts Thereof from the Federal

Republic of Germany; Final Results of

Antidumping Administrative Review (56

FR 31692, 31704–05, July 11, 1991),

when a company refuses to provide the

information requested in the form

required, or otherwise significantly

impedes the Department’s investigation,

it is appropriate for the Department to

assign to that company the higher of (a)

the highest margin alleged in the

petition, (b) the highest calculated rate

of any respondent in the investigation,

or (c) the margin from the preliminary

determination for that firm.

We consider all PRC exporters that

did not respond, or otherwise did not

participate in the investigation, to be

uncooperative and are assigning to them

the highest margin based on information

submitted in an amendment to the

petition.

Critical Circumstances

In our notice of Preliminary

Determination of Critical
Federal Register / Vol. 60, No. 87 / Friday, May 5, 1995 / Notices 22363

Circumstances: Disposable Pocket

Lighters from the People’s Republic of

China, 60 FR 436 (January 4, 1995), we

found that critical circumstances exist

with respect to imports of disposable

lighters from COTCO and Cli-Claque.

Pursuant to section 733(e)(1) of the

Act and 19 CFR 353.16, we based our

determination for COTCO on a finding

of (1) an imputed knowledge of

dumping to the importers because the

estimated dumping margins were in

excess of 25 percent, and (2) massive

imports of disposable lighters over a

relatively short period, based on an

analysis of respondent’s shipment data.

Because Cli-Claque did not submit

shipment information for the

preliminary critical circumstances

determination, we determined, as best

information available, that critical

circumstances exist. Cli-Claque

submitted the requested information on

January 6, 1995. For non-respondent

exporters, we determined that critical

circumstances do exist.

Respondents’ shipment information

has now been verified. The Department

affirms the analysis as explained in its

preliminary finding with respect to

PolyCity, Gao Yao, GLIP and COTCO.

Accordingly, we determine that critical

circumstances do not exist with respect

to imports of disposable lighters from

PolyCity, Gao Yao, and GLIP and do

exist with respect to COTCO and all

non-responding exporters. With respect

to Cli-Claque, we also determine that

critical circumstances do exist (see

Comment 13).

Verification

As provided in section 776(b) of the

Act, we verified the information

submitted by respondents for use in our

final determination. We used standard

verification procedures, including

examination of relevant accounting and

production records, and original source

documents provided by respondents.

Our verification results are outlined in

detail in the public version of the

verification report, available in Room B–

099 of the Main Commerce Building,

14th and Constitution, Washington DC

20230.

Interested Party Comments

General Issues

Comment 1: Separate Rates

Petitioner argues that an exporter

should not receive a separate rate unless

the producer supplying the exporter can

demonstrate that it is also independent

of central government control. The fact

that an exporter is independent from

central government control provides no

guarantee that the producer or

producers supplying it are also free of

government control. Since respondents

have not overcome the presumption that

their Chinese disposable lighter

producers are government controlled,

and the exporters merely serve as

middlemen for the sale of lighters to the

U.S., the exporters should be assigned

the ‘‘PRC-Wide’’ rate.

Petitioner questions whether the

Department originally intended to apply

the separate rates analysis only to

exporters. Petitioner points to the Final

Determination of Sales at Less than Fair

Value: Sparklers from the People’s

Republic of China (56 FR 20588, May 6,

1991) (Sparklers), where the Department

enumerated separate rates for

‘‘producer/exporter’’ combinations.

However, in recent cases, such as Final

Determination of Sales at Less Than

Fair Value: Coumarin from the People’s

Republic of China (59 FR 66899,

December 28, 1994) (Coumarin), the

Department has indicated that it is

intentionally restricting its analysis of

freedom from government control solely

to exporters. Petitioner argues that

under this policy, the Department could

find itself in the position of certifying

that an exporter is independent and,

therefore, can be assigned a separate

rate, while the exporter is purchasing

from a producer who would not be

allowed a separate rate because of

government control. Petitioner does not

believe that this is what the Department

intended when it enunciated its

separate rates analysis in Sparklers.

Petitioner also questions why the

market oriented industry (‘‘MOI’’) test

looks at the producer and not the

exporter, while the separate rates test

does the opposite.

Gao Yao, GLIP, and COTCO argue that

the independence of their suppliers is

not relevant to the Department’s

determination of whether Gao Yao,

GLIP, and COTCO should receive

separate rates. The Department has

sought, received, and verified

information concerning the

independence of Chinese exporters. Gao

Yao, GLIP, and COTCO argue that

examining the suppliers is irrelevant

and conflicts with well-established

Department policy.

Both PolyCity and Cli-Claque argue

that they are independent Hong Kong

companies, and the Chinese government

does not own and cannot control

PolyCity’s or Cli-Claque’s activities.

Therefore, they are entitled to separate

rates.

DOC Position

The separate rates policy reflects the

Department’s concern that the Chinese

government may interfere in the export

activities of companies selling to the

United States and manipulate these

companies’ export prices. Where an

exporter is able to demonstrate that its

export activities are not controlled by

the government, then the Department

will recognize that independence by

awarding the exporter a separate rate

(see, e.g., Saccharin).

Petitioner’s argument that trading

companies are merely middlemen

suggests that the Chinese government

manipulates the price of exports to the

United States (1) by controlling the

price between the factory and the

trading company, or (2) by controlling

the exporter’s price to the United States

through the producer. With respect to

the first concern, the manufacturer’s

price to the exporter does not play any

role in the Department’s calculation.

U.S. price is based on the exporter’s

(usually a trading company’s) price to

the United States and FMV is based on

the producer’s factors of production.

Therefore, potential government control

of prices between the producers and

exporters is irrelevant. Moreover, where

the producer is not the exporter, we

have determined there is no evidence

that the producer is involved in the

export activities of the exporter.

Because the exporter/trading

company sets the export price, it is

appropriate to focus the separate rates

analysis on the exporter. In contrast, the

purpose of the MOI test is to determine

whether foreign market value can be

determined using prices or costs in the

NME. Thus, the test focuses on

government control of the domestic

industry, rather than on export

activities. Thus, petitioner’s attempt to

draw a parallel between a separate rates

analysis and an MOI analysis is

misplaced.

Comment 2: ‘‘Tied’’ Antidumping Duty

Rates for Exporter/Supplier

Petitioner argues that where the

Department issues a separate rate to an

exporter, that rate should be applied to

the producer/exporter combination that

gave rise to the rate. Consequently, if the

exporter later purchases from another

producer, the ‘‘PRC–Wide’’ rate should

apply. Such ‘‘tied’’ rates would prevent

producers from channeling merchandise

out of the PRC through the exporter

with the lowest rate.

Petitioner agrees with the

Department’s decision to tie Gao Yao

and its manufacturer when it assigned

them a zero margin in the preliminary

determination, making any other

manufacturers shipping through Gao

Yao subject to the ‘‘PRC–Wide’’ rate.

However, petitioner contends that the

Department has refused to recognize
22364 Federal Register / Vol. 60, No. 87 / Friday, May 5, 1995 / Notices

that other exporters have been given a

free hand to export disposable lighters

from any producer in China to the

United States at the rate applicable to

that exporter. Consequently, producers

will sell through exporters with low

rates, thereby avoiding the higher rates

found in this investigation, particularly

the ‘‘PRC–Wide’’ rate. Because of the

distinction made for zero margins,

petitioner argues that it is more

beneficial for an exporter to have a

small positive margin than to have a

zero margin, as an exporter with a small

positive margin may export for any

producer at that small margin.

Therefore, petitioner requests that the

Department issue antidumping duty

rates for exporter/producer

combinations.

Gao Yao, GLIP, and COTCO state that

petitioner’s conclusion regarding the

channeling of all exports through the

exporter with the lowest dumping

margin is erroneous. In the past, trading

companies which export to the United

States have received individual rates

irrespective of their suppliers. COTCO

and GLIP state that it is appropriate for

Gao Yao to receive a ‘‘tied’’ rate for

merchandise sold and manufactured by

Gao Yao, because Gao Yao is a

manufacturer who exports, not a trading

company. COTCO and GLIP state that,

as trading companies, they should not

receive a ‘‘tied’’ rate even if they receive

a zero margin. Gao Yao, GLIP, and

COTCO argue that even if a new factory

made shipments of goods to the United

States through an exporter with a lower

dumping rate, the subsequent

antidumping review would require a

factors analysis of the supplying factory.

Cli-Claque maintains that it is an

independent Hong Kong company that

competes with all other lighter

manufacturers. It has no incentive or

desire to help its competitors ship to the

United States. Moreover, if Cli-Claque

shipped other companies’ lighters to the

United States, Cli-Claque would risk

losing its low dumping margin in

subsequent reviews.

DOC Position:

We have determined that the pairing

of exporters and producers for

calculating antidumping rates is

inappropriate under the circumstances

discussed above. Recent Department

practice has been to assign rates only to

exporters except in the case of

producer/exporter combinations that

have been found not to be dumping.

(See e.g., Pencils, Saccharin, Coumarin,

and Final Antidumping Duty

Determination: Certain Cased Pencils

from the People’s Republic of China, 59

FR 55625, November 8, 1994, where the

Department assigned a zero rate to a

producer/exporter for purposes of

exclusion from the order, but the

remaining rates were assigned to

exporters only.) Where a producer/

exporter combination is found not to be

dumping, it is appropriate to publish a

rate that applies to that producer/

exporter combination because they are

excluded from the order and, therefore,

future administrative reviews. However,

all other exporters remain subject to the

order and administrative reviews.

Hence, contrary to petitioner’s assertion,

those exporters have no incentive to

export the output of producers that

might yield a high FMV unless they

adjust their U.S. prices accordingly. If

they fail to do so, an administrative

review would result in an assessment of

additional duties, with interest, and a

higher cash deposit rate for future

entries.

Comment 3: Overhead and Energy

COTCO, Gao Yao and GLIP argue that

the cable from the U.S. Embassy in

Jakarta, relied upon by the Department

in its preliminary determination, does

not state if indirect labor and electricity

are included in overhead. Since this is

unclear, COTCO, Gao Yao and GLIP

argue that the Department should

assume, as it has in past cases, that

indirect labor and electricity are

included in factory overhead. (See

Sebacic Acid from the People’s Republic

of China, (59 FR 28053, 28060, May 31,

1994) and Shop Towels of Cotton from

the People’s Republic of China (56 FR

4040, 4042 , February 1, 1991).) COTCO,

Gao Yao and GLIP also state that the

activities of the indirect laborers are not

directly related to production and

would normally be included in

overhead.

PolyCity states that the standard cost

accounting treatment throughout the

world for electricity and other utilities

is to include these items in factory

overhead. According to PolyCity, the

Department double-counted these items

when it separately included values for

them in addition to calculating a factory

overhead rate.

Petitioner acknowledges that the

factory overhead rate in the U.S.

Embassy cable does not make clear

whether indirect labor is included.

However, since COTCO, Gao Yao and

GLIP argue that there is very little

indirect labor involved in lighter

production, petitioner states that there

would be little, if any, double counting

if indirect labor were valued separately.

DOC Position

For this final determination, we are

using information from the Reserve

Bank of India Bulletin, (‘‘RBIB’’)

December 1993 to value factory

overhead. We were unable to obtain an

overhead rate for light manufacturing

plants in Indonesia. Therefore, we

turned to India, where a manufacturing

overhead rate was available. We have

determined that this overhead figure

represents the best overhead figure for

the industry in question because it is

industry specific.

In determining what items should be

valued separately from factory

overhead, we examined the costs

included in the particular overhead rate

being used. Since the RBIB factory

overhead rate does not include indirect

labor and energy, we are assigning

separate values for these items,

notwithstanding respondents’

arguments about standard cost

accounting practices.

Comment 4: Date of Sale

Petitioner argues that the date of sale

should be the date of Cli-Claque’s and

PolyCity’s facsimile confirmation, not

the date of invoice. Petitioner contends

that Cli-Claque and PolyCity negotiate

price, quantity, and estimated delivery

date by phone and confirm these terms

by facsimile. However, these companies

reported the date of invoice as the date

of sale. Because of a drastic increase in

imports during June and the first half of

July, petitioner is particularly concerned

about any sales confirmed in the POI,

but not invoiced in the POI.

PolyCity and Cli-Claque state that the

Department chose the date of sale based

on our normal methodology and that

they correctly complied with its request.

DOC Position

At verification, we confirmed that the

appropriate date of sale was the date

PolyCity and Cli-Claque issued the

invoice which accompanied the

shipping documentation. We noted that

changes in delivery terms and quantity

did occur between the facsimile

confirmation and the date of invoice.

Although the verification report stated

that the facsimile was a ‘‘confirmation’’

facsimile, that statement was not meant

to imply that all the terms of sale were

agreed upon and could not change. The

facsimile, as verified, is merely an

acknowledgement that a sales

transactions will occur between the

company and its customer.

Generally speaking, the Department

will consider the date of sale to be the

date on which all substantive terms of

the sale are agreed upon by the parties.

This normally includes the price and

quantity. If the terms of sales agreement

or contract permit the revision of prices

up to the date of invoice, shipment, or
Federal Register / Vol. 60, No. 87 / Friday, May 5, 1995 / Notices 22365

the purchase order, then it is the

Department’s practice to base the date of

sale on the shipment date, invoice date,

or the purchase order date, depending

upon which date the revisions are made.

Thus, we accept the date of sale as

verified.

Comment 5: Non-market Economy

Currency

PolyCity and petitioners have

advanced arguments regarding the

valuation of certain inputs purchased

from market economy suppliers, that

cannot be addressed in this notice

because of their proprietary nature.

These comments are addressed in a

separate memorandum to the file.

Comment 6: Appropriate BIA Rate

Petitioner maintains that the

Department should use the highest rate

(i.e., 346.55 percent) alleged in the

petition as the ‘‘PRC-Wide’’ rate.

Petitioner calculated the FMV used in

this margin calculation based on a

combination of Indian input values and

its own costs. Petitioner states that

because the Department believed that it

relied too heavily on its own costs and

that India may not be the most

appropriate surrogate country, the

Department requested that petitioner

recalculate FMV based on the price of

lighters exported from the Philippines.

(The Philippines is a known producer of

disposable lighters and, in prior cases,

the Philippines had been determined to

be at a level of economic development

comparable to the PRC.) The estimated

dumping margin using the Philippine

export data is 197.85 percent. Petitioner

argues that, although it submitted

additional information requested by the

Department (offered as an alternative set

of documents to supplement the

exhibits in the original petition), the

margin calculated in the original

petition has not been discredited.

DOC Position

We are continuing to use the rate

based on Philippine export data. We

believe this rate is appropriate because:

(1) The original petition rate relies too

heavily on petitioner’s own costs; (2) we

initiated the case on the basis of the

Philippine export data; and (3) India is

not a significant producer of lighters.

Company Specific Issues

PolyCity Industrial Limited

Comment 7: BIA

Petitioner argues that the Department

should use BIA in determining the

antidumping duty margin for PolyCity

because, due to the numerous

corrections submitted to the Department

since the preliminary determination and

the errors discovered at verification, the

reliability of PolyCity’s data is called

into question. In particular, petitioner

notes: (1) Every sale examined at

verification required revision; (2)

foreign inland freight, ocean freight, and

marine insurance were misreported; (3)

PolyCity used an unusual sales process;

and (4) PolyCity’s method of

documenting input purchases lacked

consistency. Petitioner contends that

PolyCity had more than adequate time

to correct these errors in the numerous

submissions PolyCity filed between the

preliminary determination and

verification. Petitioner argues that these

facts, along with the inaccuracies

uncovered at verification, make

PolyCity’s data unreliable. Therefore,

the Department should use

uncooperative BIA in calculating

PolyCity’s margin.

If the Department does not use total

uncooperative BIA, petitioner then

argues that the Department should use

partial BIA for these costs. Petitioner

contends that since PolyCity failed to

report certain additional charges for

foreign inland freight, reported ocean

freight in the wrong currency, and

miscalculated marine insurance, using

BIA values for these factors is

appropriate.

PolyCity maintains that accepting

petitioner’s allegations would run

counter to the Department’s practice

and regulations. PolyCity states that all

of its submissions and corrections have

been timely filed. The verification at

PolyCity was routine, and the

Department treated it routinely. The

Department typically makes corrections

and adjustments at verification. The

corrections discovered at verification

were merely errors, not hidden or

misrepresented information. In

addition, PolyCity maintains that it

erred in favor of the petitioner, rounding

numbers up on most observations. To

use BIA in this situation would be a

radical departure from the Department’s

rules and practice. Hence, the

Department should use PolyCity’s

verified information.

DOC Position

We agree with respondent that the

final determination should be based on

PolyCity’s verified data. The items

described by petitioner are minor

changes that were corrected for this

final determination. Omissions from the

response were inadvertent and corrected

information was verified. We are

satisfied that the record is now complete

and accurate regarding this company’s

sales of subject merchandise during the

POI.

Comment 8: New Sales

Petitioner states that the three new

invoices discovered at verification

should be included in the margin

calculations and should be assigned the

highest BIA rate. Since these sales were

not reported in a timely manner,

petitioner argues that the Department

should assign a unit margin for each of

these sales based on BIA. Due to the

numerous errors found at verification,

petitioner recommends using the

uncooperative BIA rate. For one sale,

which was added to PolyCity’s sales

listing after the preliminary

determination, petitioner recommends

using the cooperative BIA rate.

PolyCity states that three sales were

inadvertently excluded from the sales

listing but that they have now been

included. Therefore, BIA for these sales

is unwarranted. The one sale petitioner

alleges was added to PolyCity’s sales

listing after the preliminary

determination was, in fact, included in

the first sales listing and every listing

since. Therefore, it should not be treated

differently than the other sales that have

been reported.

DOC Position

We determine that the omissions

described above were inadvertent and

the corrected information was verified.

The new sales represent a small

percentage of total sales during the POI

and, at verification, were not hidden or

misrepresented. Further, we are

satisfied that the record is now complete

and accurate as to this company’s sales

during the POI of subject merchandise.

Accordingly, the reported information,

as corrected based on verification, is the

appropriate basis for this LTFV

determination for PolyCity.

Comment 9: Untimely Submissions

Petitioner argues that changes and

additions to PolyCity’s data which were

submitted on February 21, 1995, should

be rejected as untimely filed with the

Department.

PolyCity states that this submission

was timely filed in accordance to

instructions given by Department

officials. PolyCity argues, however, that

petitioner’s comment should not have

been included in the brief filed on April

10, 1995, since only comments on

verification reports were to be filed.

Accordingly, PolyCity argues that this

comment cannot be included in the

record.

DOC Position

We agree with respondent, in part.

Respondent’s submissions were timely

filed, in accordance with our

instructions. However, we disagree with
22366 Federal Register / Vol. 60, No. 87 / Friday, May 5, 1995 / Notices

respondent that petitioner’s comments

should have been rejected. Due to

miscommunication between the

Department and the parties in this case,

parties were unclear where to report

company-specific issues that were not

verification issues. Therefore, we have

determined that this argument was

properly included in this brief and have

allowed it to remain in the record of this

investigation.

Comment 10: Use Actual Labor Rates

Respondent argues that the

Department should use the actual wage

rates paid by PolyCity to its Chinese

workers. In the past, the Department has

used actual costs for certain factors of

production, if these costs represent

accurate, market-based values. Since the

workers of PolyCity freely negotiate

their wages without interference from

the central government (e.g.

unemployed workers wait at the factory

gate to interview for open positions,)

respondent believes that there is no

basis for the use of surrogate values.

If the Department rejects the use of

PolyCity’s wage rates, respondent asks

that we use the average of the wages on

the record for unskilled factory0

workers in Indonesia. The rate used by

the Department in its preliminary

determination based on locally engaged

U.S. Embassy personnel in Indonesia is

not a valid surrogate for the cost of

unskilled factor labor in China.

DOC Position

As stated above, we have determined

that the PRC is a non-market economy

country for purposes of this

determination. Moreover, there has been

no claim and we have not found that

available information would permit us

to determine FMV under the market

economy provisions of the antidumping

duty law (see section 773(c)(1)(b) of the

Act). Hence, we are basing FMV on the

Chinese factors of production values in

a surrogate country.

PolyCity points to Lasko Metal Prods.,

Inc. v. United States 810 F. Sup. 314

(CIT 1992) aff’d 43 F.3d 1442 (Fed. Cir.

1994) to support the proposition that the

Department can use respondent’s actual

costs when those costs represent

accurate market-economy values.

However, Lasko addresses Department’s

practice of using respondent’s actual

costs in narrow circumstances—i.e.,

where the input is purchased from a

market economy country and paid for in

a market economy currency. We do not

use values within the non-market

economy.

Moreover, in the one case cited by

PolyCity (Final Determination of Sales

at Less Than Fair Value: Chrome Plated

Lug Nuts From the People’s Republic of

China, 56 FR 46153, 46154, September

10, 1991), the Department was

investigating an MOI claim, not a claim

that labor was market oriented. In

addition, the Department did not find

that wages in the PRC were market

determined. To the contrary, we

stated,’’ * * * we have concluded that

respondent has not overcome the

presumption of state control with

respect to labor and that the PRC wage

rate should not be used for purposes of

the factors of production analysis.’’

Comment 11: Manufactured Parts vs.

Purchased Parts

In cases where PolyCity both

purchases a part and produces the same

part from imported raw materials, it

argues that the price it pays for the

purchased part should not be used to

value this input. Instead, the

Department should construct a value

using the factors needed to produce the

part.

PolyCity contends that valuing the

part using the price paid for the finished

part would overstate the amount of

labor and overhead allocated to

PolyCity’s other activities. This is

because PolyCity’s labor and overhead

figures include labor and overhead to

produce these parts, and the Department

does not have the necessary information

to back out these amounts.

Alternatively, if the Department does

not accept PolyCity’s proposal to use

solely a constructed value, then it

should value the parts on a weightaverage basis between the purchased

and the manufactured parts.

DOC Position

We disagree with respondent that we

should use the factors methodology for

all of the parts consumed during the

POI. Contrary to PolyCity’s assertion, to

use the factors methodology for all parts

consumed during the POI would

understate the labor and overhead

because it would not include additional

labor and overhead needed to produce

those parts. Thus, we have only applied

the factors methodology for inputs

actually produced by PolyCity.

For the portion of the parts used

which PolyCity purchases from market

economy suppliers in a market economy

currency, we valued the part using an

invoice price outside the POI. While our

first preference would be an invoice

price during the POI, in this

investigation we are accepting actual,

pre-POI prices paid to a market

economy producer in market economy

currency because such prices, although

outside the POI, are the best available

information on the value of these inputs

and are more accurate than surrogate

values. In many instances, the

Department uses surrogate values that

are from pre-POI time periods and are

generally further removed from the POI

than the pre-POI market economy

prices. Using pre-POI market economy

prices that the producer actually paid is

consistent with that practice.

Comment 12: Jakarta vs. Non-Jakarta

Rates

PolyCity maintains that the

Department should use a non-Jakarta

wage rate in valuing labor. It states that

wage rates in Jakarta are not an

appropriate surrogate for wages in

Chinese factories because Chinese

lighter factories are located in small,

provincial towns, not major cities like

Jakarta. Moreover, PolyCity states that

not one of the Indonesian lighter

factories is located in Jakarta.

DOC Position

We disagree that we are required ‘‘to

customize’’ factor values to reflect the

conditions of certain PRC respondents.

We have used ILO data pertaining to

Indonesian wage rates to value the labor

input for all PRC producers. This data

reflects an Indonesian-wide average, not

the wage rate in Jakarta.

Cli-Claque Company Limited

Comment 13: Electronic Lighters

Cli-Claque claims that its flat,

refillable electronic lighter, referred to

as a card lighter, is not disposable and

should not be included within the scope

of the investigation. In contrast to flint

lighters, this Cli-Claque lighter uses a

piezo electronic lighting mechanism.

Further, because of its unique flat shape,

the lighter must be produced from a

more costly, higher grade of plastic.

With respect to channels of

distribution, Cli-Claque sell these

lighters at wholesale to tobacco and

other companies for use as promotional

items. Because these lighters are

considerably more costly to produce,

Cli-Claque states that it could not sell

them at retail in competition with

ordinary flint lighters.

Throughout the investigation,

petitioner has maintained that the

existence of an electric lighting

mechanism alone should not be a

determining factor in deciding whether

a lighter is or is not disposable.

Petitioner cites examples of disposable

lighters that use the piezo electric

ignition mechanism. Regarding ultimate

use of the lighter, petitioner maintains

that it is the same as the flint lighter—

to light various tobacco products.

Regarding channels of distribution,

petitioner states that Cli-Claque’s
Federal Register / Vol. 60, No. 87 / Friday, May 5, 1995 / Notices 22367

lighters could compete at retail with

flint lighters, if the manufacturer

imprinted designer wraps or logos to

entice customers to pay a somewhat

higher price.

DOC Position

Although Cli-Claque’s card lighters

are not currently sold at retail but are

sold at wholesale to tobacco and other

companies as promotional items, these

lighters are not the only type of lighters

to be sold to companies as promotional

items. The standard, disposable butane

lighter is also sold to companies as a

promotional item. Thus, the card

lighters are not unique in their use as

promotional items, because standard,

disposable lighters clearly serve this

purpose as well.

Also, the existence of a piezo electric

ignition mechanism is not decisive.

Several brands of disposable lighter

employ the piezo mechanism rather

than the more common flint ignition

system. The fact that a lighter is

refillable is also not controlling, as

indicated in the scope of this

investigation, which recognizes that a

disposable lighter may be refillable or

non-refillable.

Further, card lighters come in both

refillable and non-refillable versions.

The lighters are identical in every

respect with the exception of the refill

valve on the refillable lighter. Both

lighters feature the more expensive

plastic and the piezo electric lighting

mechanism. The addition of a refill

value to the card lighter is insufficient

to warrant reclassifying it as a nondisposable lighter. Therefore, disposable

lighters with refill valves clearly fall

within the scope of the investigation.

Comment 14: Critical Circumstances

Cli-Claque argues that critical

circumstances do not exist. Cli-Claque

maintains that the increase in July 1994

is due to a shipment to a U.S. customer

to meet the July 12, 1994 deadline. This

deadline, established by the Consumer

Products Safety Commission’s

(‘‘CPSC’’). The CPSC barred the import

of disposable lighters that did not meet

more stringent safety requirements after

July 1994. Thus, Cli-Claque argues that

this shipment did not result from the

filing of the antidumping petition, but

from U.S. regulatory requirements

imposed by CPSC.

Cli-Claque argues that, with respect to

the history of dumping, although the

Council of European Communities

found dumping of gas-fueled, nonrefillable pocket flint lighters, the

margin in the case of China was only

16.90 percent, well below the

Department’s 25 percent threshold. In

addition, according to Cli-Claque, the

European determination did not cover

piezo-electric lighters, but only flint

lighters. Since piezo-electric lighters

represent a significant percentage of the

lighters exported to the United States by

Cli-Claque, the Department should not

impute knowledge of dumping to CliClaque. Moreover, Cli-Claque maintains

that the Department cannot impute

knowledge of dumping to Cli-Claque’s

importers since the Department found a

dumping margin of only 7.03 percent.

The Department’s practice has been to

impute such knowledge only where it

finds a preliminary margin equal to or

greater than 25 percent.

Petitioner argues that although the

European determination only covers

flint lighters, the Department has

preliminarily determined that electronic

lighters are in the same class or kind of

merchandise as flint lighters. In

addition, petitioner argues that, as noted

in the verification report, Cli-Claque

used the date of sale, rather than the

shipment date, for reporting monthly

shipments. According to petitioner, this

incorrect reporting understates the

massiveness of imports by shifting

shipments from the post-petition filing

period to the pre-petition filing period.

Finally, petitioner argues that although

Cli-Claque claims that the increase in

July 1994 was due to a shipment to a

customer to meet the July 12, 1994

deadline established by the CPSC, the

Department has repeatedly held that the

statute and regulations make no

mention of weighing other factors or

examining alternative causes as to the

reason for increased imports.

Petitioner also argues that the

Department should continue to find that

critical circumstances exist with respect

to imports of lighters from Cli-Claque.

Petitioner maintains that the first prong

of the statutory requirement for critical

circumstances, i.e., knowledge of

dumping, is fulfilled. Petitioner states

that disposable lighters from the PRC

have been found to be dumped in both

the European Union and Argentina. In

1991, the European Commission (EC)

imposed antidumping duties on gasfueled, non-refillable pocket flint

lighters originating in China. The fact

that the margin on lighters from China

was only 16.9 percent is irrelevant for

this prong of the knowledge test.

According to petitioner, the Department

requires a 25 percent margin on imports

only when the Department is imputing

knowledge of dumping under the

second alternative criteria for

knowledge of dumping, not when the

Department is inquiring whether there

is a history of dumping in the United

States or elsewhere under the first

alternative criteria for knowledge of

dumping.

DOC Position

We disagree with petitioner that a

history of dumping exists with respect

to disposable lighters. We do not require

the scope of our proceeding to match

exactly the scope of the foreign

proceeding. Since the lighters examined

by the EC are subject to this

investigation, we find that there is a

history of dumping with respect to the

class or kind of merchandise as a whole

and, by extension, with respect to CliClaque. We have established a history of

dumping with respect to Cli-Claque and

we agree with petitioner that in

evaluating this criterion, the size of the

margin found by the EC is irrelevant.

Because there is a history of dumping,

we are not required to consider whether

the importer knew or should have

known that the exporter was selling the

subject merchandise at less than fair

value.

We have also considered whether

imports of the merchandise have been

massive over a relatively short period of

time in accordance with 19 CFR

353.16(f) and (g). Based on verified

information on shipments by CliClaque, we find that imports have been

massive over a relatively short period of

time, even when taking into account the

increase in volume in advance of the

July 1994 deadline for importing nonchildproof lighters. (For a more detailed

analysis, see the proprietary Calculation

Memorandum for this final

determination.) Therefore, we find that

critical circumstances exist with respect

to imports on behalf of Cli-Claque

because a history of dumping exists and

because imports have been massive over

a relatively short period of time.

Comment 15: Defective Lighters

Cli-Claque argues that there is no

need to adjust total production figures

to account for defective lighters, as

petitioner maintains, since the

production figures used in the factor of

production calculations are already net

of defective lighters sold to customers in

the PRC which were later returned to

Cli-Claque.

DOC Position

We agree with petitioners and have

made an adjustment to the cost of

manufacture to account for the defective

lighters sold which were later returned

to Cli-Claque.

Comment 16: Water and Diesel

Petitioner argues that the Department

should not include water and diesel in

overhead, but should calculate values
22368 Federal Register / Vol. 60, No. 87 / Friday, May 5, 1995 / Notices

for these inputs separately, using

surrogate values. Petitioner maintains

that the diesel fuel used to power the

generators is a direct factor of

production in producing lighters, and

not, as in some other cases, an

incidental expense. As a direct factor of

production, diesel fuel should be

included as a separate factor of

production and not included as a part

of factory overhead.

Cli-Claque argues that water should

be treated as an overhead item. With

regard to diesel fuel, Cli-Claque has

submitted the total kilowatt hours of

electricity used because electricity is the

direct input used in the production

process. Cli-Claque asserts that if the

Department were to also include diesel

fuel used to produce electricity as a

factor of production, it would be

double-counting the cost of electricity.

DOC Position

We agree with respondents that water

should be included in factory overhead

and, therefore, should not be valued

separately. Because it is normal practice

to include such cost in factory overhead,

and the RBIB data did not indicate to

the contrary, we find it reasonable to

presume that water is included in the

overhead value we used (See

Saccharin).

We also agree with Cli-Claque that, for

those companies that generate

electricity using diesel-powered

generators, inclusion of diesel fuel and

electricity as separate factors of

production would result in doublecounting. Since diesel fuel is the factor

actually used by these companies, we

have used the diesel fuel input in our

calculation of FMV, where possible.

However, for some companies this was

not possible and, instead, we valued the

electrical output of the generators as the

best available information.

Comment 17: Labor Hours

Petitioner argues that the Department

should adjust labor hours used to make

the electronic lighter caps because, at

verification, the Department noted

differences for the total number of hours

worked by unskilled labor in the metal

workshop.

Cli-Claque maintains that no

adjustment should be made to its labor

calculations for the metal workshop and

that petitioner’s comment on this point

is based on a misreading of the

verification report. According to CliClaque, as stated in the verification

report, the labor hours per month for the

metal workshop were calculated by

multiplying the number of days per

month a machine was in operation by

the average labor hours worked per day.

The difference, cited by petitioner, was

not a discrepancy between the data

reported and the figure verified but the

difference between the skilled and

unskilled hours worked per day in the

metal workshop.

DOC Position

We agree with respondent. Our

discussion in the verification report was

to note only the difference in the

number of hours worked between

skilled and unskilled workers in the

metal workshop. We did not note any

discrepancies in the information we

reviewed.

Comment 18: Electroplating

Petitioner argues that the Department

should assign appropriate surrogate

values for electroplating as best

information available since

electroplating was done by a non-market

economy source. In addition, petitioner

argues that Cli-Claque likely incurred

transportation charges for shipping

lighter caps for electroplating.

Therefore, surrogate values for these

transportation charges should also be

included.

Respondent argues that electroplating

merely adds a finish to caps produced

by Cli-Claque. The Department

reviewed the invoice provided by the

subcontractor at verification and found

that the charges were insignificant.

DOC Position

Based on information reviewed at

verification, we agree with respondent

that electroplating was an insignificant

cost, and would be included in the

surrogate overhead value. We disagree

with petitioner’s characterization of the

Department’s practice, i.e., if a material

is used in the production process, it

should be included in the direct

materials calculation. As stated in

Saccharin, it is standard practice to

classify certain inputs as variable

overhead. Electroplating is infrequently

used in the production process, is small

in value relative to the total cost of

manufacturing the product and, hence,

would be included in the surrogate

country overhead value. Therefore, we

have not valued it separately.

Gao (HK) Hua Fa Industrial Co. Ltd.(Gao

Yao)

Comment 19: Market Economy Inputs

Originally Reported in Renminbi (RMB)

Petitioner states that the Department

should use surrogate values for all

inputs Gao Yao reported to the

Department in Renminbi (RMB), but

actually purchased in Hong Kong

dollars. Petitioner argues that Gao Yao

incorrectly reported purchases based on

Gao Yao’s calculation of the exchange

rate.

Gao Yao argues that certain

accounting records are maintained in

RMB but this should not be grounds for

using surrogate values. Gao Yao states

that the discrepancy caused by its

calculation of the exchange rate had a

negligible effect on import prices, and

the Department should use market

economy prices for material inputs

purchased from market economy

suppliers.

DOC Position

When a respondent purchases imports

from a market economy and pays in a

market economy currency, the

Department prefers using the actual

price of that input rather than a

surrogate value, (see, e.g., Final

Determinations of Sales at Less Than

Fair Value: Oscillating Fans and Ceiling

Fans from the PRC, (56 FR 55271,

55275, October 25, 1991), upheld Lasko

Metal Products v. U.S. 810 F. Sup. 314,

Aff’d, 43 F. 3rd 1142 (Fed. Cir. 1994)).

For purposes of our final determination,

we have used actual, verified prices for

those inputs which were purchased by

Gao Yao from a market economy

supplier and paid for in market

economy currencies.

Comment 20: Natural Gas

Petitioner argues that the Department

should include natural gas in its

calculation of Gao Yao’s FMV since it

reported that it uses natural gas.

Gao Yao states that the reference in its

response to ‘‘natural gas’’ was incorrect.

The input in question was butane—a

factor which was separately reported.

According to Gao Yao, the Department

verified that it did not use natural gas

as an energy source.

DOC Position

We agree with respondent. At

verification, we determined no natural

gas was being used in the production

process.

Comment 21: Port Handling Charges

and Rejected Lighters

Petitioner also asserts that the

Department should adjust Gao Yao’s

production information to reflect

lighters which failed internal quality

control inspection.

DOC Position

We agree with petitioner. We have

adjusted our calculation of FMV to

account for lighters which were

unsaleable.
Federal Register / Vol. 60, No. 87 / Friday, May 5, 1995 / Notices 22369

Guangdong Light Industrial Products

Import and Export Corporation (GLIP)

Comment 22: Governmental Ownership

and Independence

Petitioner states that GLIP should not

be granted a separate rate because a

portion of the company’s shares are held

by a governmental entity. Petitioner

argues that, while no evidence of

governmental interference was found

during verification, the fact remains that

shares of the company are held by the

government and, since GLIP only

transformed to a shareholding company

shortly after the POI, circumstances may

change inciting the State Asset

Management Bureau to take actions

which interfere in the company’s

operations.

Petitioner states further that not

enough is known about the level of

governmental control exerted over GLIP

during the POI, when the company was

still owned by ‘‘all the people.’’

Accordingly, petitioner argues that GLIP

should not be granted a separate rate in

this investigation and should be

assigned the ‘‘PRC-Wide rate.’’

DOC Position

During verification, the Department

examined all correspondence files

pertaining to the period prior to the POI,

the POI, and the period after the POI.

We also examined bank records during

the POI and found no evidence of

government control over the company

activities. In addition, based on

discussions with GLIP officials,

described in detail in our verification

report, that GLIP’s management has not

changed since the company’s

transformation from a company owned

by ‘‘all the people’’ to a company owned

by shareholders. It is not the

Department’s practice to deny eligibility

for a separate rate based on speculation

that a government might someday try to

influence a company’s operations. If this

did occur, a future administrative

review would analyze such government

influence in its determination of

whether to grant a separate rate for this

company. Currently, based on our de

facto analysis of governmental control

over the company’s export activities, we

conclude that GLIP is independent of

government control. (See Separate Rates

discussion).

Comment 23: Cost Factors Should be

Adjusted for Variances

Petitioner states that the Department

should adjust the standard usage

amounts for materials and labor when

calculating FMV for the lighters sold by

GLIP to account for variances from

standard observed at verification.

Petitioner additionally states that since

warehouse withdrawal tickets are the

only method for establishing variances

for material usage, the Department

should use these tickets to calculate

variances for material usage.

DOC Position

We have adjusted labor figures to

account for variances observed during

verification for purposes of our final

determination. We have based material

usage on reported amounts, however,

because the variances calculated using

warehouse tickets appeared to be largely

influenced by the amount of raw

materials in work-in-process. Since the

producer of lighters did not maintain

records of raw materials inventory in

work-in-process, it is not possible to

calculate actual consumption.

Comment 24: Butane Consumption

Petitioner states that the Department

should use gross consumption figures

for butane in calculating GLIP’s FMV for

purposes of its final determination.

DOC Position

We agree with petitioner, and have

made this adjustment for purposes of

our final determination with respect to

GLIP. Factory officials stated at the

beginning of verification that they had

inadvertently reported the net amount

of butane in the final product in the

company’s response to the Department’s

antidumping questionnaire rather than

the gross amount of butane used in

producing the lighters. We verified the

correct amounts and have used them in

this determination.

China National Overseas Trading

Corporation (COTCO)

Comment 25: Foreign Exchange

Controls

Petitioner argues that COTCO should

not be granted a separate rate because

the company is subject to foreign

currency controls which are indicative

of a lack of independence from the

central government. Petitioner states

that in Sparklers, the Department stated

that for an exporter to be granted a

separate rate the company must (1) set

its own export prices, and (2) be

allowed to keep the proceeds from its

sales. Petitioner cites to the

Department’s verification report, where

management states that COTCO must

ask permission to refund foreign

currency on returned merchandise.

Petitioner contends this statement is

indicative of a lack of control over

earnings and, consequently, a lack of

independence.

Respondent argues that there is ample

evidence of COTCO’s independence

from government control. Respondent

adds that Department officials verified

that there were no returns or refunds for

any subject merchandise during the POI.

DOC Position

Although COTCO must receive

permission to purchase foreign

currency, during verification we viewed

evidence that COTCO regularly

purchases foreign exchange to pay for

imported merchandise. We saw no

evidence of returned merchandise; the

statement by COTCO officials

concerning returned merchandise was

in response to a hypothetical question

from Department officials. The PRC’s

complex system of foreign exchange

controls is not per se evidence of

governmental control (see, e.g.,

Coumarin). The body of evidence

gathered at verification indicates that

COTCO retains control over its earnings,

both foreign and domestic.

Comment 26: Affiliated Companies

Petitioner states that the companies

which are affiliated with COTCO did

not cooperate in this investigation and

it should be assumed that they had

unreported lighter sales to U.S.

customers during the POI. Accordingly,

petitioner argues, COTCO should not be

granted a separate rate, and should be

assigned the ‘‘PRC-Wide’’ rate as

punitive BIA.

Respondent states that COTCO

included information for all lighter sales

to U.S. customers in its response and

that during verification Department

officials requested information to

confirm that all sales had been reported.

Respondent argues that a separate rate

based on its verified response is

appropriate in the Department’s final

determination.

DOC Position

We agree with respondent. At

verification, consistent with normal

verification practices, we verified that

no COTCO affiliate, except for the one

under investigation, sold the subject

merchandise during the POI. COTCO

officials cooperated with Department

verifiers to the best of their ability and

we are satisfied that our tests of the

completeness of COTCO’s response

demonstrates that all sales of subject

merchandise have been included.

Comment 27: Shipment After POI

Petitioner states that a shipment made

by COTCO after the POI and for which

there was no sales contract should be

assumed to have been a sale during the

POI and should be included in the

company’s sales listing.
22370 Federal Register / Vol. 60, No. 87 / Friday, May 5, 1995 / Notices

Respondent states that all sales made

during the POI were included in the

data submitted to the Department, and

that sales made after the POI should not

be included in the Department’s

antidumping duty rate calculation.

DOC Position

We agree with respondent. We saw no

evidence during verification that the

sale relating to the shipment in question

was made during the POI. During

verification, we viewed another

example of a sale by COTCO where a

contract was not generated prior to

shipment of the merchandise. Given the

date of shipment, the invoice date, and

based on statements by COTCO officials,

we believe the sale should not be

included in COTCO’s sales data for the

POI.

Continuation of Suspension of

Liquidation

For Gao Yao, we calculated a zero

margin. Consistent with Notice of Final

Determination of Sales at Less Than

Fair Value: Certain Cased Pencils from

the People’s Republic of China (59 FR

55625, November 8, 1994), merchandise

that is sold by Gao Yao but

manufactured by other producers will

not receive the zero margin. Instead,

such entries will be subject to the ‘‘PRCwide’’ margin.

In accordance with sections 733(d)(1)

and 735(c)(4)(B) of the Act, we are

directing the Customs Service to

continue to suspend liquidation of all

entries of disposable pocket lighters

from the PRC, that are entered, or

withdrawn from warehouse, for

consumption on or after the date of

publication of this notice in the Federal

Register. The Customs Service shall

require a cash deposit or posting of a

bond equal to the estimated amount by

which the FMV exceeds the USP as

shown below. These suspension of

liquidation instructions will remain in

effect until further notice. The

weighted-average dumping margins are

as follows:

Manufacturer/producer/exporter

Weighted-average

margin

percentage

Critical circumstances

China National

Overseas Trading Corporation *.

0 Affirmative.

Cli-Claque Company Ltd.6.15 Affirmative.

Gao Yao (HK)

Hua Fa Industrial Co., Ltd.

0 Negative.

Manufacturer/producer/exporter

Weighted-average

margin

percentage

Critical circumstances

Guangdong Light

Industrial Products Import and

Export Corporation.

27.91 Negative.

PolyCity Industrial,

Ltd.

5.50 Negative.

PRC-Wide ............ 197.85 Affirmative.

* This company has not disclosed for the

public record the identity of its supplier or suppliers in the PRC. Upon public disclosure of

this information to the Department, we will notify the Customs Service that sales through

certain supply channels have an LTFV margin

of zero and thus an exclusion from any order

resulting from this investigation. Until and unless such disclosure is made, all entries will

be subject to the ‘‘PRC-wide’’ deposit rate.

ITC Notification

In accordance with section 735(d) of

the Act, we have notified the

International Trade Commission (ITC) of

our determination. As our final

determination is affirmative, the ITC

will determine whether these imports

are causing material injury, or threat of

material injury, to the industry in the

United States, within 45 days. If the ITC

determines that material injury, or

threat of material injury, does not exist,

the proceeding will be terminated and

all securities posted will be refunded or

cancelled. If the ITC determines that

such injury does exist, the Department

will issue an antidumping duty order

directing Customs officials to assess

antidumping duties on all imports of the

subject merchandise entered, or

withdrawn from warehouse, for

consumption on or after the effective

date of the suspension of liquidation.

This determination is published

pursuant to section 735(d) of the Act

and 19 CFR 353.20(a)(4).

Dated: April 27, 1995.

Susan G. Esserman,

Assistant Secretary for Import

Administration.

[FR Doc. 95–11161 Filed 5–4–95; 8:45 am]

BILLING CODE 3510–DS–P

National Oceanic and Atmospheric

Administration

[I.D. 042795C]

Pacific Fishery Management Council;

Public Meeting

AGENCY: National Marine Fisheries

Service (NMFS), National Oceanic and

Atmospheric Administration (NOAA),

Commerce.

ACTION: Notice of public meetings.

SUMMARY: The Pacific Fishery

Management Council’s Groundfish

Management Team (GMT) will hold

public meetings on May 23–24, 1995,

and May 30 through June 1, 1995.

ADDRESSES: Pacific Fishery Management

Council; 2130 SW Fifth Avenue, Suite

224; Portland, OR 97201.

FOR FURTHER INFORMATION CONTACT: Jim

Glock, Groundfish Fishery Management

Coordinator; telephone: (503) 326–6352.

SUPPLEMENTARY INFORMATION: The first

meeting will be held in Room 370 West

of NMFS Northwest Fisheries Science

Center Montlake Laboratory, 2725

Montlake Boulevard East, Seattle, WA.

The meeting will begin at 8 a.m. on

both days. The May 23 session will not

adjourn until the business for the day is

completed and may go into the evening.

The May 24 session will adjourn by

4 p.m.

The purpose of this meeting is to

review draft economic reports and to

prepare for the June 27–29 Council

meeting in Clackamas, Oregon.

The second meeting, a joint meeting

of the GMT and the Groundfish

Subcommittee of the Scientific and

Statistical Committee, will be held May

30 through June 1, 1995, in the

conference room of NMFS Southwest

Fisheries Science Center, 3150 Paradise

Drive, Tiburon, California. The meeting

will begin at 1 p.m. on May 30, and at

8 a.m. on May 31 and on June 1. The

sessions are expected to end each day

about 5 p.m. This joint meeting, which

is held annually, will be devoted to

preparation of the groundfish stock

assessments that will be presented to

the Council in August 1995.

Both meetings are physically

accessible to people with disabilities.

Requests for sign language

interpretation or other auxiliary aids

should be directed to Michelle Perry

Sailer at (503) 326–6352 at least 5 days

prior to the meeting date.

Dated: April 28, 1995.

Richard W. Surdi,

Acting Director, Office of Fisheries

Conservation and Management, National

Marine Fisheries Service.

[FR Doc. 95–11071 Filed 5–4–95; 8:45 am]

BILLING CODE 3510–22–F

[I.D. 042695B]

Marine Mammals

AGENCY: National Marine Fisheries

Service (NMFS), National Oceanic and

Atmospheric Administration (NOAA),

Commerce.