64 FR 32481, June 17, 1999 DEPARTMENT OF COMMERCE International Trade Administration [A-570-504] Final Results of Expedited Sunset Review: Petroleum Wax Candles from the People's Republic of China AGENCY: Import Administration, International Trade Administration, Department of Commerce. ACTION: Notice of final results of expedited sunset review: Petroleum wax candles from the People's Republic of China. ----------------------------------------------------------------------- SUMMARY: On January 4, 1999, the Department of Commerce (``the Department'') initiated a sunset review of the antidumping order on petroleum wax candles from the People's Republic of China (64 FR 364) pursuant to section 751(c) of the Tariff Act of 1930, as amended (``the Act''). On the basis of a notice of intent to participate and substantive comments filed on behalf of the domestic industry and inadequate response (in this case, no response) from respondent interested parties, the Department determined to conduct an expedited review. As a result of this review, the Department finds that revocation of the antidumping order would be likely to lead to continuation or recurrence of dumping at the levels indicated in the Final Results of Review section of this notice. FOR FURTHER INFORMATION CONTACT: Scott E. Smith or Melissa G. Skinner, Office of Policy for Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, NW, Washington, DC 20230; telephone: (202) 482- 6397 or (202) 482-1560, respectively. Effective Date: June 17, 1999. Statute and Regulations This review was conducted pursuant to sections 751(c) and 752 of the Act. The Department's procedures for the conduct of sunset reviews are set forth in Procedures for Conducting Five-year (``Sunset'') Reviews of Antidumping and Countervailing Duty Orders, 63 FR 13516 (March 20, 1998) (``Sunset Regulations''). Guidance on methodological or analytical issues relevant to the Department's conduct of sunset reviews is set forth in the Department's Policy Bulletin 98:3-- ``Policies Regarding the Conduct of Five-year (``Sunset'') Reviews of Antidumping and Countervailing Duty Orders; Policy Bulletin, 63 FR 18871 (April 16, 1998) (``Sunset Policy Bulletin''). Scope The merchandise subject to this antidumping order is certain scented or unscented petroleum wax candles made from petroleum wax and having fiber or paper-cored wicks. They are sold in the following shapes: Tapers, spirals and straight-sided dinner candles; rounds, columns, pillars, votives; and various wax-filled containers.1 This product is currently classified under Harmonized Tariff Schedule (HTS) item number [[Page 32482]] 3406.00.00. The HTS item number is provided for convenience and U.S. Customs purposes. The written product description remains dispositive. --------------------------------------------------------------------------- \1\ There have been numerous clarifications to the scope of this order. For a complete listing of these clarifications, see Appendix A. --------------------------------------------------------------------------- This review covers imports from all manufacturers and exporters of petroleum wax candles from the People's Republic of China. Background On January 4, 1999, the Department initiated a sunset review of the antidumping order on petroleum wax candles from the People's Republic of China (63 FR 66527), pursuant to section 751(c) of the Act. The Department received a Notice of Intent to Participate on behalf of the National Candle Association (``NCA'') on January 15, 1999, within the deadline specified in Sec. 351.218(d)(1)(i) of the Sunset Regulations. The NCA claimed interested party status under section 771(9) of the Act.2 The NCA stated that it is a trade association comprised of 40 domestic producers of the subject merchandise. In addition, the NCA noted that it was the petitioner in the original investigation. We received a complete substantive response from the NCA on February 3, 1999, within the 30-day deadline specified in the Sunset Regulations under Sec. 351.218(d)(3)(i). We did not receive a substantive response from any respondent interested party to this proceeding. As a result, pursuant to 19 CFR 351.218(e)(1)(ii)(C), the Department determined to conduct an expedited, 120-day review of this order. --------------------------------------------------------------------------- \2\ In its substantive response of February 3, 1999, the NCA claimed interested party status under section 771(9)(E) of the Act, as a trade association, a majority of whose members manufacture candles in the United States. --------------------------------------------------------------------------- Determination In accordance with section 751(c)(1) of the Act, the Department conducted this review to determine whether revocation of the antidumping order would be likely to lead to continuation or recurrence of dumping. Section 752(c) of the Act provides that, in making this determination, the Department shall consider the weighted-average dumping margins determined in the investigation and subsequent reviews and the volume of imports of the subject merchandise for the period before and the period after the issuance of the antidumping order, and shall provide to the International Trade Commission (``the Commission'') the magnitude of the margin of dumping likely to prevail if the order is revoked. The Department's determinations concerning continuation or recurrence of dumping and the magnitude of the margin are discussed below. In addition, the NCA's comments with respect to continuation or recurrence of dumping and the magnitude of the margin are addressed within the respective sections below. Continuation or Recurrence of Dumping Drawing on the guidance provided in the legislative history accompanying the Uruguay Round Agreements Act (``URAA''), specifically the Statement of Administrative Action (``the SAA''), H.R. Doc. No. 103-316, vol. 1 (1994), the House Report, H.R. Rep. No. 103-826, pt.1 (1994), and the Senate Report, S. Rep. No. 103-412 (1994), the Department issued its Sunset Policy Bulletin providing guidance on methodological and analytical issues, including the bases for likelihood determinations. In its Sunset Policy Bulletin, the Department indicated that determinations of likelihood will be made on an order-wide basis (see section II.A.3). In addition, the Department indicated that normally it will determine that revocation of an antidumping order is likely to lead to continuation or recurrence of dumping where (a) dumping continued at any level above de minimis after the issuance of the order, (b) imports of the subject merchandise ceased after the issuance of the order, or (c) dumping was eliminated after the issuance of the order and import volumes for the subject merchandise declined significantly (see section II.A.3). In addition to considering guidance on likelihood provided in the Sunset Policy Bulletin and legislative history, section 751(c)(4)(B) of the Act provides that the Department shall determine that revocation of an order is likely to lead to continuation or recurrence of dumping where a respondent interested party waives its participation in the sunset review. In the instant review, the Department did not receive a response from any respondent interested party. Pursuant to Sec. 351.218(d)(2)(iii) of the Sunset Regulations, this constitutes a waiver of participation. The antidumping duty order on petroleum wax candles from People's Republic of China was published in the Federal Register on August 28, 1986 (51 FR 30686). The Department has conducted one administrative review of this order.3 The order remains in effect for all manufacturers and exporters of the subject merchandise. --------------------------------------------------------------------------- \3\ See Petroleum Wax Candles from the People's Republic of China; Final Results of Antidumping Duty Administrative Review, 53 FR 47742 (November 25, 1988). --------------------------------------------------------------------------- In its substantive response, the NCA argues that revocation of the order against candles from the People's Republic of China would likely result in the continuation of dumping (see February 3, 1999 Substantive Response of the NCA at 10). With respect to whether dumping continued at any level above de minimis after the issuance of the order, the NCA states that the dumping margin has remained at 54.21 percent for all exports of the subject merchandise during the entire life of the order (see February 3, 1999 Substantive Response of the NCA at 11). Further, with respect to whether imports of the subject merchandise ceased after the issuance of the order, the NCA states that, following the imposition of the order, imports of the candles from the People's Republic of China decreased dramatically and remained relatively low for several years. The NCA argues, however, that there has been an increase in the imports of non-subject candles from the People's Republic of China in recent years. They believe the exclusion of certain types of candles from the order, through means of scope clarifications, has permitted an increase in the imports of candles that can enter the United States without restriction (see February 3, 1999 Substantive Response of the NCA at 11). In conclusion, the domestic interested parties argued that the Department should determine that there is a likelihood that dumping continue if the order were to be revoked because (1) dumping margins have existed for all known exporters of the subject merchandise during the entire life of the order and (2) shipments of subject merchandise decreased significantly following the imposition of the order and have not regained their pre-order levels. In making its decision, the Department considered the existence of dumping margins and the volume of imports before and after the issuance of the order. As discussed in section II.A.3 of the Sunset Policy Bulletin, the SAA at 890, and the House Report at 63-64, if companies continue dumping with the discipline of an order in place, the Department may reasonably infer that dumping would continue if the discipline were removed. In the instant proceeding, a dumping margin of 54.21 percent has existed throughout the life of the order for shipments of the subject merchandise from all Chinese producers/ exporters.4 --------------------------------------------------------------------------- \4\ The Department established a dumping margin of 54.21 percent for all producers, manufacturers, and exporters of the subject merchandise in the original investigation of this case (see Petroleum Wax Candles from the People's Republic of China: Final Determination of Sales at Less Than Fair Value, 51 FR 25085 (July 19, 1986)). In the antidumping duty order, the Department published an ``all others'' rate of 54.21 percent as well as a 54.21 percent rate for China National Native Produce and Animal By-Product Import & Export Corp. (see Antidumping Duty Order: Petroleum Wax Candles From the People's Republic of China, 51 FR 30686 (August 28, 1986)). In the only administrative review of this order, the Department also published an ``all others'' rate of 54.21 percent as well as 54.21 percent rate for P&C Enterprises (Hong Kong) (see Petroleum Wax Candles from the People's Republic of China; Final Results of Antidumping Duty Administrative Review, 53 FR 47742 (November 25, 1988)). --------------------------------------------------------------------------- [[Page 32483]] Consistent with section 752(c) of the Act, the Department also considered the volume of imports of the subject merchandise before and after issuance of the order. The statistics on imports of petroleum wax candles between 1983 and 1998, provided by the domestic interested parties and confirmed by U.S. Census Bureau IM146 reports, indicate that annual imports of candles from the People's Republic of China covered under the HTSUS item number decreased sharply the year the order was created but, in recent years, have again increased and even surpassed the levels attained prior to the imposition of the order. The NCA argues that a substantial portion of the increase in import volumes of merchandise covered by the HTSUS item number may be attributed to merchandise determined by the Department to be excluded from the scope of the order and is, therefore, not relevant to this sunset determination.5 Nonetheless, the Department can confirm, through an examination of U.S. Census Bureau IM146 Reports, that imports of subject merchandise continue in substantial quantities. --------------------------------------------------------------------------- \5\ See Appendix A for a list of scope determinations made in this case. --------------------------------------------------------------------------- We find that the existence of a deposit rate above a de minimis level coupled with the continued exportation of subject merchandise is highly probative of the likelihood of continuation or recurrence of dumping. The SAA at 890, and the House Report at 63-64, state that the ``(e)xistence of dumping margins after the order, or the cessation of imports after the order, is highly probative of the likelihood of continuation or recurrence of dumping. If companies continue to dump with the discipline of an order in place, it is reasonable to assume that dumping would continue if the discipline were removed.'' A dumping margin continues in effect for exports of the subject merchandise by all known PRC exporters. Therefore, given that dumping has continued over the life of the order and respondent interested parties have waived their right to participate in this review before the Department, and absent argument and evidence to the contrary, the Department determines that, consistent with Section II.A.3 of the Sunset Policy Bulletin, dumping is likely to continue if the order were revoked. Magnitude of the Margin In the Sunset Policy Bulletin, the Department stated that it will normally provide to the Commission the margin that was determined in the final determination in the original investigation. Further, for companies not specifically investigated or for companies that did not begin shipping until after the order was issued, the Department normally will provide a margin based on the ``all others'' rate from the investigation. (See section II.B.1 of the Sunset Policy Bulletin.) Exceptions to this policy include the use of a more recently calculated margin, where appropriate, and consideration of duty absorption determinations. (See sections II.B.2 and 3 of the Sunset Policy Bulletin.) The Department, in its final determination of sales at less than fair value, published a weighted-average dumping margin for all producers, manufacturers, and exporters of petroleum wax candles from the People's Republic of China (51 FR 25085, July 10, 1986). The Department has not issued any duty absorption findings in this case. In its substantive response, the NCA states that the dumping margin established in the original investigation is at least as high as the margin likely to prevail if the order were revoked. The NCA, echoing the guidance provided by the Sunset Policy Bulletin, argues that this margin best reflects the behavior of the PRC exporters absent the constraints of an antidumping order (see February 3, 1999 Substantive Response of the NCA at 12). The Department agrees with the NCA's argument concerning the choice of the margin rate to report to the Commission. An examination of the margin history of the order as well as an examination of import statistics of the subject merchandise, as provided by U.S. Census Bureau IM146 Reports, confirms that dumping margins have existed throughout the life of the order and that imports of the subject merchandise continue. The Department finds the margin from the original investigation is the only calculated rate that reflects the behavior of producers and exporters without the discipline of the order. Therefore, consistent with the Sunset Policy Bulletin, we determine that the margin calculated in the Department's original investigation is probative of the behavior of PRC producers and exporters of petroleum wax candles if the order were revoked. We will report to the Commission the country- wide rate from the original investigation contained in the Final Results of Review section of this notice. Final Results of Review As a result of this review, the Department finds that revocation of the antidumping order would likely lead to continuation or recurrence of dumping at the margins listed below: ------------------------------------------------------------------------ Margin Manufacturer/exporter (percent) ------------------------------------------------------------------------ All Chinese Manufacturers/Exporters........................ 54.21 ------------------------------------------------------------------------ This notice serves as the only reminder to parties subject to administrative protective order (APO) of their responsibility concerning the disposition of proprietary information disclosed under APO in accordance with 19 CFR 351.305 of the Department's regulations. Timely notification of return/destruction of APO materials or conversion to judicial protective order is hereby requested. Failure to comply with the regulations and the terms of an APO is a sanctionable violation. This five-year (``sunset'') review and notice are in accordance with sections 751(c), 752, and 777(i)(1) of the Act. Dated: June 11, 1999. Robert S. LaRussa, Assistant Secretary for Import Administration. Appendix A The following is a list of scope clarifications issued by the Department, the date of the determination, and the party who requested the clarification. Please note that scope requests received after July 1, 1997 have been analyzed pursuant to the Department's revised scope regulations (19 CFR part 351). ------------------------------------------------------------------------ Department's Date Interested party determination ------------------------------------------------------------------------ 6 Jan 99.................... Meijer.............. Wax-filled container (rabbit-shaped) within scope. [[Page 32484]] 24 Dec 98................... Endar............... ``Floating'' candle within scope. 18 Dec 98................... Boston Warehouse.... Citronella outdoor candle not within scope. 18 Dec 98................... Ocean State Jobbers. 80% beeswax, 20% petroleum wax candles not within scope. 15 Dec 98................... Target Stores....... Citronella outdoor candles not within scope. 11 Dec 98................... Et Al. Imports...... 80% beeswax, 20% petroleum wax candles not within scope. 10 Dec 98................... Costco Wholesale.... 81% beeswax, 19% petroleum wax candles not within scope. 31 Aug 98................... Leader Light........ Parffin/palm oil in stearic acid shell in scope wax-filled container. 24 Aug 98................... Kohl's.............. Various; gold rope, angel, and vine decorated in scope; star and tree w.f. containers in scope; container with Xmas scene outside scope. 2 Jul 98.................... Et Al. Imports...... Bamboo-shaped candle outside scope. 11 Jul 98................... Meijer, Inc......... Various candles and w.f. containers (see scope ruling); 11 Jun 98................... Meijer, Inc......... Sweetheart tapers and wax-filled glass containers with decorative hearts are within the scope of the order. A wax-filled porcelain bunny, and Easter taper with a chick attached, an Easter bunny head teal light, a Valentine heart teal light, a heart-shaped candle on a heart base, a ``candy kiss'' candle, and a ``bunny long ears'' flame are outside the scope of the order. 6 May 98.................... Polardreams Inc..... Granular petroleum wax candle kits are within the scope of the order. 16 Mar 98................... American Drug Stores Spherical ``wax veneer'' candle outside scope. 15 Dec 97................... Meijer, Inc......... Gold/green rectangle ``Noel'' outside scope, gold/green rectangle ``Joy'', ``Peace'' candles in scope; flame candle in scope; wax-filled Valentines candle mug outside scope. Filed Incorrectly........... Fimax, Inc.......... Decorated spherical candles; received 3 Sep 97; contacted about correcting deficiencies but no reply. 25 Sep 97................... Russ Berrie......... Heart-shaped ``trinket box'' candle in scope; 8 Sep 97.................... Meijer, Inc......... Four terra cotta containers in scope; jack-o'- lantern out; 2 Sep 97.................... Russ Berrie......... Star-shaped ``confetti'' pillar is within scope. 15 Sep 97................... Indio Products, Inc. Assorted tapers, columns and votives in scope. 25 Sep 97................... M.G. Maher.......... Red spiral candles in scope; 9 Apr 97.................... Dollar Tree Stores.. Holly taper is outside scope. 9 Apr 97.................... Hallmark Cards...... Red/white candle packaged as peppermint candy is within scope. 9 Apr 97.................... Inst. Financing Red/white candle Services. packaged as peppermint candy is within scope. Pending..................... Ocean State Jobbers. 80/20 beeswax/ petroleum wax tapers and votives; received 3 Sep 96; no deadline. Withdrawn................... Sun-It Corp......... Citronella tapers; received 27 Jun 96; no deadline. Terminated.................. Cost Plus........... Beeswax/petroleum wax tapers; request withdrawn by Cost Plus. 9 Dec 96.................... Mervyn's............ Cube candle with sun face is within scope. 30 Oct 96................... Midwest of Cannon Certain pillars, Falls. Easter taper are in; asparagus stalk is outside scope; Cube, oblong within scope. 30 Oct 96................... Enesco Corp......... Holiday candles, disc-shaped candle are outside scope; Cube, birthday within scope. 28 Oct 96................... Russ Berrie Co., Inc Heart-shaped terra cotta container is within scope. 26 Aug 96................... Delightful 75/25 beeswax/ Dimensions. petroleum wax tapers are within scope ``until otherwise notified by the Department.'' (USCS classification ruling). Terminated.................. Kendal King Graphics Holiday wax-filled tins; terminated 29 Aug 96 at Kendal's request. 25 Sep 96................... Springwater Christmas feather Confection vs. the candle is within United States. scope, holly feather candle is outside scope (Slip Op. 96-160 CIT; remand of 14 Feb 95 ruling). 24 Jun 96................... Morris Friedman & Co Wax-filled bucket, wax-filled glass containers are within scope. 28 Sep 95................... Concept Marketing... ``Safe-2-Lite'' candle is outside scope because it is a utility candle. 16 May 95................... Sun It Corporation.. ``Flag Lites,'' ``Porch Torch,'' ``Gigantic Fruit,'' Pumpkin candles are outside scope. Terminated.................. Boomster Imports.... Cube candle; terminated 6 Jul 95. Terminated.................. Kmart Corporation... Holiday pillar candles; terminated 26 Jun 95. 14 Feb 95................... Watkins Incorporated Holiday pillar candle is outside scope. 14 Feb 95................... Springwater ``Feather'' spiral Confection. candles are within scope (remanded by CIT; see 13 May 96, above). 13 Jan 95................... Two's Company....... Taper with holiday figurine is outside scope; pillar candles with decorations are within scope. [[Page 32485]] 16 Dec 94................... Lew-Mark............ Wax-filled ``pansy'' tins are within scope. Terminated.................. Scentex, Inc........ Candles containing potpourri; candles produced in Macau; terminated 7 Sep 94. 27 Jul 94................... Star Merchandise Co. Certain citronella Inc. candles outside scope; candles in holiday tins outside scope; certain wax-filled containers are within scope. 27 Jul 94................... Success Sales Co.... Holiday pillar candles are outside scope. 27 Jul 94................... West Coast Tapers with holiday Liquidators. figurines and candles molded as identifiable objects are outside scope. 6 Jun 94.................... Kole Imports........ Tapers with holiday figurines are outside scope 6 Jun 94.................... A J Cohen Co........ Tapers with holiday figurines are outside scope. 30 Sep 93................... Cherrydale Farms.... Currier & Ives holiday tins are outside scope. 30 Sep 93................... Hallmark Cards, Inc. ``Party'' rounds are within scope; certain wedding candles are outside scope. 10 Jun 93................... San Francisco Candle Certain mushroom, oval/egg, and spherical candles are outside scope. 7 Jun 93.................... Primark............. Certain wax-filled tins with Santa Claus designs are outside scope; other wax-filled tins within scope. 9 Apr 93.................... Trade Advisory Group Certain terra cotta candles are within scope. 9 Apr 93.................... Garrett Hewitt, ``Giorgio'' candles Int'l. are within scope. 12 Feb 93................... Simcha Candle Co.... ``Household'' candles are outside scope; certain tealight candles are within. 17 Mar 92................... Wolf D. Barth Co.... Van Gogh ``sculpture'' and Monet spiral are within scope. 11 Dec 91................... W.M. Stone & Co..... Easter holiday tapers are outside scope (USCS ruling). 4 Nov 91.................... San Francisco Candle Moonlite and Candylite candles are within scope. 3 Sep 91.................... Fabri-Centers, Inc.. Certain citronella candles are outside scope. 2 Jul 90.................... Rite Aid Corp....... Certain holiday tapers are outside scope (USCS ruling). 20 Mar 89................... U.S. Customs Service ``Party'' candles CIE N-212/85; Supp. (6\5/8\ by \1/8\) 8. are outside scope Ruling issued directly to USCS. in ltr to A R Beikirch, USCS, 8 Feb 89. 21 Sep 87................... U.S. Customs Service Certain novelty CIE N-212/85; Supp. candles w/scenes or 6. symbols outside scope; numeral and ``identifiable object'' candles outside scope. 9 Sep 87.................... West Coast Certain holiday Liquidators. pillars and tapers are outside scope (USCS ruling). 23 Aug 87................... Carmichael Certain novelty International. candles are outside scope. 23 Jul 87................... Empire Candle Co.... Candles with metal- cored wicks are within scope. 13 Jul 87................... Giftco, Inc......... Candles w/raised holiday motifs are outside scope (see CIE N-212/85, Supp. 6, 21 Sep 87). 30 Oct 86................... Global Marketing Certain tapers with Services. permanently attached figurines are outside scope. ------------------------------------------------------------------------ [FR Doc. 99-15445 Filed 6-16-99; 8:45 am] BILLING CODE 3510-DS-P