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Newsletter

Possible Imposition of Substantially
Higher Antidumping Duties on
Petroluem Wax Candles From China

February 5, 2003

In August 2002, the National Candle Association (NCA), who represents U.S. candle producers, filed a request with the U.S. Department of Commerce for an administrative review of the antidumping duty (“AD”) rate of various exporters of petroleum wax candles from China. We believe that there is a possibility that Chinese exporters and U.S. importers of petroleum wax candles from China could see the antidumping (AD) duty rate increased by as much as 75%, based upon “facts available” in a recent new shipper case. This administrative review covers entries during the period of review (August 1, 2001, through July 31, 2002). An update on this proceeding is as follows:

1.                Survey by U.S. Commerce of Chinese Exporters

In this review, Commerce, instead of immediately sending out antidumping questionnaires, sent out “surveys” to Chinese exporters and manufacturers of candles who had been named in the requests filed with Commerce. A list of the Chinese suppliers named in this review is attached at the end of this newsletter. One of the purposes of the survey was to determine whether all of these exporters had exported candles to the U.S. during the period of review. In this way, Commerce would know to whom a questionnaire should be sent. The issuance of this survey also meant that there was a delay in forwarding the questionnaire.

2.                Issuance of AD Questionnaire By Commerce

In the very near future, the U.S. Department of Commerce will be forwarding antidumping questionnaires to exporters who have been determined by Commerce to have shipped candles during the period of review. Companies who respond adequately to the Commerce questionnaire will be assigned a new rate based on the information they submit. The new rate could be either higher or lower than the current 54.21% rate.

Those exporters who do not respond to the questionnaire, or who do not file adequate responses, will be subject to “facts available,” meaning an adverse determination by Commerce. Such adverse determinations generally rely on the highest rate applicable in past inquiries, which until recently was 54.21%.

3.                Possible New “Facts Available” Rate of 95.22%

We expect, however, that the NCA will now press Commerce to apply a new, higher “facts available” rate to companies that do not respond at all or who respond inadequately to the Commerce questionnaire. Specifically, we believe that the NCA may argue that a 95.22% rate, which was the final rate determined for exports by Shanghai New Star Import in a recent review, should be the “facts available” rate for exporters found to have been uncooperative (non-responding or inadequately responding) with the Commerce proceeding. Commerce has already taken this position preliminarily in an ongoing review for exporter Dongguan Fay Candle Co., Ltd. In that review, Commerce stated:

Therefore, we determine that the respondents did not cooperate to the best of their ability and that the use of adverse facts available is appropriate under section 776(b). Accordingly, as adverse facts available, we have applied the calculated margin of 95.22 percent as published in Petroleum Wax Candles from the People's Republic of China: Notice of Final Results of New Shipper Review, 67 FR 41395 (June 18, 2002).

If the 95.22% rate is adopted as the “facts available” rate, it means that importers who made antidumping deposits with Customs based on the 54.21% rate during the period under review (August 1, 2001, through July 31, 2002) could wind up facing a final duty assessment bill that is 75 percent higher than expected. In addition, the 95.22% rate would be the new deposit rate going forward for those companies deemed uncooperative in this review.

4.                Avoiding The Possible Final Assessment and New Deposit Rate of 95.22%

We believe, based on our experience, that a higher rate is likely, although not certain. Responding to the Commerce questionnaire is the only way for companies being reviewed to avoid paying a higher dumping duty, should Commerce decide to adopt the higher rate of 95.22%. An exporter’s failure to respond adequately to the questionnaire will mean that the exporter will be subject to whatever “facts available” rate is finally determined by Commerce.

The area of antidumping duties is a difficult and complicated one, and professional advice should be sought with regard to completing a questionnaire and for counsel in participating effectively in these antidumping proceedings.

Our law firm specializes in the practice of antidumping, Customs, and international trade. We have had substantial experience with regard to the AD order on candles from China and other AD cases. If you or any of your suppliers believe you may be subject to this Commerce antidumping administrative review, please do not hesitate to contact us.

If you have any questions on the issues raised in this newsletter, please contact Stephen S. Spraitzar at (415) 288-0427, or at sss@tuttlelaw.com

List of Chinese Candle Suppliers Named In The Requests
Filed With U.S. Commerce For An Administrative Review

Dongguan Fay Candle Company, Ltd.
Generaluxe Factory
Guangdong Xin Hui City Si Qian Art & Craft Factory
Sincere Factory Company
Qingdao Kingking Applied Chemistry Co., Ltd.
DDP Qingdao
ADP (Ningbo, PRC)
ADP Shanghai
Allock Ltd.
Amstar Business Company Limited
Anyway International Trading & Manufacturing Co., Ltd.
Huangyan Imp. & Exp. Corp.
Aroma Consumer Products (Hangzhou) Co., Ltd.
Candle World Industrial Co.
China Hebei Boye Great Nation Candle Co., Ltd.
China Overseas Trading Dalian Corp.
China Packaging Import & Export Liaoning Co.
China Xinxing Zhongyuan (Wuhan) Imp. & Exp.
CNACC (Zhejiang) Imports & Export Co., Ltd.
Cnart China Gifts Import & Export Corp.
Dalian Hanbo Lighting Co., Ltd.
Dandong Hengtong Handicraft Article Co., Ltd.
Ever-gain Industrial Co.
Excel Network Limited
Far Going Candle Gifts Co., Ltd.
Dongijeng Fecund Imp. & Exp. Co. Ltd.
Fujian Provincial Arts & Crafts Imp. & Exp. Corp.
Fu Kit
Fushun Candle Corporation
Fushun Economy Development Zone Xinyang Candle Factory
Fushun Huaiyuan Wax Products Co., Ltd.
Fushun Yuhua Crafts Factory
Fushun Yuanhang Paraffin Products Industrial Company
Gansu Textiles Imp. & Exp. Corp.
Green Islands Industry Shanghai Co. Ltd.
Huangyan Imp. & Exp. Corp.
Jason Craft Corp.
Jiangsu Holly Corporation
Jilin Province Arts and Crafts
Jiangsu Yixing Foreign Trade Corp.
Jintan Foreign Trade Corp.
Kingking A.C. Co., Ltd.
Kuehne & Nagel (Hong Kong) Beijing
Kwung's International Trade Co., Ltd.
Liaoning Arts & Crafts Import & Export
Liaoning Native Product Import & Export Corporation, Ltd.
Liaoning Light Industrial Products Import &Export Corp.
Liaoning Light
Liaoning Province Building Materials Industrial
Liaoning Xinyuan Textiles Import and Export
Li & Fung Trading Ltd
Lu Ke Trading Co., Ltd.
Ningbo Free Zone Top Rank Trading Co.
Ningbo Free Trade Zone Weicheng Trading Co., Ltd.
Ningbo Kwung's Giftware Co., Ltd.
Ningbo Kwung's Import & Export Co.
Ningbo Sincere Designers & Manufacturers Ltd.
Premier Candle Co.
Qingdao Allite Radiance Candle Co., Ltd.
Qingdao Happy Chemical Products Co., Ltd.
Qingdao Kingking Applied Chemistry Co., Ltd.
Quanzhou Wenbao Light Industry Co.
Red Sun Arts Manufacture (Yixing) Co., Ltd.
Rich Talent Trading Ltd.
Round-the-World (USA) Corp.
Round-the-World International Trade & Trans.
Service (Tianjin) Co., Ltd.
Seven Seas Candle Ltd.
Shandong H&T Corp.
Shangdong Jiaye General Merchandise Co. Ltd.
Shandong Native Produce International Trading Co., Ltd.
Shanghai Asian Development Int'l
Shanghai Broad Trading Co. Ltd.
Shanghai Charming Wax Co., Ltd.
Shanghai Gifts & Travel
Shanghai Gift & Travel Products Import & Export Corp.
Shanghai Jerry Candle Co., Ltd.
Shanghai Ornate Candle Art Co., Ltd.
Shanghai New Star Im/Ex Co., Ltd.
Shanghai Sincere Gifts Designers & Manufacturers, Ltd.
Shanghai Shen Hong Corp.
Shanghai Success Arts & Crafts Factory
Shanghai Xietong Group O/B Asia 2 Trading Company
Shanghai Zhen Hua
c/o Shanghai Light Industrial Int'l Corp., Ltd.
Silkroad Gifts
Simon International
Smartcord International Co., Ltd.
Suzhou Industrial Park Nam Kwong Imp & Exp Co., Ltd.
Suzhou Industrial Park Nam Kwong Imp & Exp Co., Ltd.
Tianjin Native Produce Import & Export Group Corp., Ltd.
Taizhou International Trade Corp.
Taizhou Sungod Gifts Co., Ltd.
Thi Group Ltd. and THI (HK) Ltd.
T.H.I. (HK) Ltd.
THI (HK) Ltd.
Tonglu Tiandi
Shanghai Arts and Crafts Company
Universal Candle Company Ltd.
Weltach
World-Green (Shangdong) Corp., Ltd.
World Way International (Xiamen)
Xiamen Aider Import & Export Company
Xiamen C&D Inc.
Xietong (Group) Co., Ltd.
Zen Continental Co., Inc. (Shanghai Office)
Zhejiang Native Produce & Animal By-Products Import & Export Corp.
Zhong Hang-Scanwell International
Zhongnam Candle
Zhong Nam Industrial (International) Co., Ltd.
Zhongxing Shenyang Commercial Building (Group) Co., Ltd.
Boading Mancheng Zhenxing Chemical Plant
Xinyu Chemical Plant
Yude Chemical Industry, Co.
Zhenxing Chemical Industry, Co.

 

Stephen S. Spraitzar is an attorney with the Law Offices of George R. Tuttle in San Francisco. The information in this article is general in nature and is not intended to constitute legal advice or to create an attorney-client relationship with respect to any event or occurrence, and may not be considered such.

 

Copyright 2003 by Tuttle Law Offices.

All rights reserved. Information has been obtained from sources believed to be reliable. However, because of the possibility of human or mechanical error by our offices or by others, we do not guarantee the accuracy, adequacy, or completeness of any information and are not responsible for any errors, omissions, or for the results obtained from the use of such information.

 

 

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