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Final Determination - Iodinated Radiographic Contrast Media

OTTAWA, March 30, 2000

File No. 4240-21
Case No. AD/1234

STATEMENT OF REASONS

Concerning the making of a final determination of dumping with respect to

CERTAIN IODINATED CONTRAST MEDIA USED FOR RADIOGRAPHIC IMAGING, ORIGINATING IN OR EXPORTED FROM THE United States of America (INCLUDING THE COMMONWEALTH OF PUERTO RICO)

DECISION

Pursuant to paragraph 41(1)(a) of the Special Import Measures Act, the Commissioner of Customs and Revenue has on this date made a final determination of dumping respecting iodinated contrast media for radiographic imaging, in solutions of osmolality less than 900 mOsm/kg H₂O, originating in or exported from the United States of America (including the Commonwealth of Puerto Rico).

This Statement of Reasons is also available in French.
Cet énoncé des motifs est également disponible en français.

Summary

On August 20, 1999, a dumping investigation was initiated pursuant to subsection 31(1) of the Special Import Measures Act (SIMA) respecting the alleged injurious dumping into Canada of certain iodinated contrast media used for radiographic imaging, originating in or exported from the United States of America (including the Commonwealth of Puerto Rico).

The investigation was initiated as a result of a complaint filed on June 30, 1999, by Mallinckrodt Medical Inc. of Pointe-Claire, Quebec. The company has since changed its corporate name to Mallinckrodt Canada Inc. On November 15, 1999, the time period for completing the preliminary investigation was extended to 135 days. A preliminary determination of dumping with respect to the subject goods was made on December 31, 1999.

The investigation has now been completed. On the basis of the information and evidence obtained during the investigation, the Commissioner of Customs and Revenue has made a final determination of dumping in accordance with paragraph 41(1)(a) of SIMA.

Interested Parties

Complainant

The complainant, Mallinckrodt Canada Inc. (MCI), is the only Canadian producer of iodinated contrast media used for radiographic imaging. The corporate headquarters and manufacturing facilities of the complainant are located at 7500 Trans-Canada Highway, Pointe-Claire, Quebec H9R 5H8.

Exporters

During the period of investigation from July 1, 1998 to June 30, 1999, the Canada Customs and Revenue Agency (CCRA) identified four exporters of subject goods. The names and addresses of these exporters are listed in Appendix 1.

Importers

The CCRA identified four importers of subject goods during the period of investigation. The names and addresses of these importers are listed in Appendix 2.

Other Interested Parties

There are three other interested parties to these proceedings. Their names and addresses are listed in Appendix 3.

Background

On June 30, 1999, MCI filed a complaint alleging the injurious dumping of certain iodinated contrast media used for radiographic imaging. On July 21, 1999, MCI was informed that its complaint was properly documented. At the same time, the Government of the United States of America was also notified of the filing of the complaint. A dumping investigation was initiated on August 20, 1999.

After the investigation was initiated, legal counsel for the Nycomed group of companies referred to the Canadian International Trade Tribunal (Tribunal) the question of whether the evidence before the Commissioner disclosed a reasonable indication that the dumping of the subject goods has caused injury or retardation or was threatening to cause material injury to the domestic industry. On October 18, 1999, the Tribunal ruled that there was a reasonable indication that the dumping of subject goods had caused or was threatening to cause material injury to the domestic industry.

On November 15, 1999, pursuant to paragraph 39(1)(a) of SIMA, the Commissioner of Customs and Revenue extended the time period for completing the preliminary investigation to 135 days. The extension was necessary due to the complexity of issues presented in the investigation. The preliminary determination was made on December 31, 1999.

Product

Product Definition

For the purpose of the final determination the subject goods are defined as:

"Iodinated contrast media used for radiographic imaging, in solutions of osmolality less than 900 mOsm/kg H₂O, originating in or exported from the United States of America (including the Commonwealth of Puerto Rico)."

Additional Product Information

For clarity, the subject goods include non-ionic monomers and dimers in solutions less than 900 mOsm/kg H₂O. They are commonly referred to in the industry as low osmolality contrast media (LOCM) products. LOCM products sold in Canada must be approved for specific indications (i.e., use) by the Therapeutic Products Programme (formerly the Health Protection Branch) of Health Canada.

Product Description

Medical examination of soft tissues or organs by non-surgical means often requires the introduction of a special diagnostic imaging agent which makes the detection system responsive to detail in the tissue of interest. Agents include those used in magnetic resonance, ultrasound, radionuclide imaging and X-ray technology. Radiopaques for X-ray imaging, commonly referred to as X-ray contrast media, are examples of such diagnostic agents.

The subject goods are all iodine-based compounds. Iodine is a very effective absorber of ionizing radiation and, as such, is particularly effective in enhancing X-ray images of the human body. The classification of the product as contrast media was derived from the fact that when the iodine accumulates in the target area, it creates a contrast in the X-ray image, thereby permitting visual examination of the target organ.

Additional product details and information concerning the production of the subject contrast media were provided in the Statement of Reasons issued for the initiation of the investigation.

The following summarizes the known LOCM products approved for use in Canada:

Sold By	Brand	Structure	Compound
Berlex	Ultravist	Non-ionic monomer	Iopromide
Berlex	Osmovist	Non-ionic dimer	Iotrolan
Bracco	Isovue	Non-ionic monomer	Iopamidol
MCI	Optiray	Non-ionic monomer	Ioversol
MCI	Hexabrix	Ionic dimer	Ioxaglate
Nycomed	Omnipaque	Non-ionic monomer	Iohexol
Nycomed	Visipaque	Non-ionic dimer	Iodixanol

Classification of Imports

Opacifying preparations for X-ray examinations are properly classified in Schedule I of the Customs Tariff under the Harmonized System classification number 3006.30.00.10.

Canadian Industry

There have been no changes in the structure of the Canadian industry since the initiation of this investigation. MCI remains the only Canadian manufacturer of iodinated X-ray contrast media.

The complainant manufactures two products marketed under the brand names Hexabrix and Optiray. Hexabrix is an ionic dimer produced from the powder Ioxaglate combined with other chemicals. Optiray is a non-ionic monomer produced from the powder Ioversol combined with other chemicals.

The complainant also sells Berlex products in the Canadian market in accordance with an agreement reached with Berlex in early 1999.

Canadian Market

X-ray contrast media are used primarily in hospitals. The manner of establishing selling prices to the hospitals is generally through invitation to submit bid proposals. Generally, buying groups representing several hospitals or large single hospitals, issue requests for bid proposals to the suppliers of the products. The suppliers would then submit price proposals for the supply of the required contrast media. If acceptable, the buying groups/hospitals would sign a supply contract with the suppliers. The term of a supply contract varies and can extend over several years for an accepted bid.

The buying groups/hospitals may accept one or more supply contracts from different suppliers for the contrast media in similar concentrations of iodine and package sizes. Although there is an anticipated quantity expected to be sold, there is no obligation on the part of the hospitals to buy a specific supplier's products.

Pricing of contrast media, including the subject goods, flows from published price lists which contain unit selling prices for a variety of product configurations. The list prices tend to be similar between competitors in the Canadian market, and pricing to the market is accomplished by applying percentage discounts to list prices. In addition, there may be additional incentives offered such as educational packages, equipment giveaways, volume discounts, rebate programs, discounts on other product lines and the provision of research and development support.

The subject goods are considered to be part of the pharmaceutical industry. This industry utilizes logistic service providers who distribute the products nationally on behalf of the suppliers. Generally, these companies perform a variety of services including warehousing, stocking,

re-stocking, receiving orders from the customers, picking, packing, delivering, billing the customers and receiving the payment from the customer.

Based on information available to the CCRA, the Canadian market for the subject goods during the 12 month period of investigation from July 1, 1998 to June 30, 1999, was estimated to be approximately Cdn. $22.5 million. Due to the small number of participants in the Canadian market, the actual import volume and percentage share of the market held by each participant cannot be disclosed for reasons of confidentiality. However, the volume of the imported contrast media was not negligible.

Results of the Investigation

Investigation Activities

In General

The dumping investigation covered all subject goods from the United States of America, including the Commonwealth of Puerto Rico (Puerto Rico), released from customs' possession into Canada during the period of investigation from July 1, 1998 to June 30, 1999. The subject goods are marketed by the Bracco group of companies under the brand name Isovue, by Mallinckrodt Inc., under the brand names Optiray and Hexabrix and by the Nycomed group of companies under the brand names Omnipaque and Visipaque.

Preliminary Determination

At the time of initiation of the investigation, information was requested from three companies identified by the complainant as the exporters of the goods. The companies were

Bracco Diagnostics Inc. (BDI); Mallinckrodt Inc., the parent company of the complainant; and Nycomed Inc. A Request for Information was also sent to Searle Ltd., a manufacturer of the subject goods located in Puerto Rico. This company was subsequently determined to be the exporter of the Nycomed products.

Responses to the Requests for Information were received from BDI and Nycomed Inc., two of the three companies initially identified as exporters. Searle Ltd.'s submission was received too late for consideration in making the preliminary determination. An unsolicited submission was received from Nycomed Imaging AS, Norway, the parent company of Nycomed Inc. In this regard, Nycomed Imaging AS, responded as an exporter of the subject goods. Mallinckrodt Inc. did not make a submission during the preliminary determination phase of the investigation.

Information concerning importations of the subject goods was also requested from three companies identified as the importers: Bracco Diagnostics Canada Inc. (BDCI); MCI, who is also the complainant in this investigation; and Nycomed Amersham Canada Ltd. Subsequent to the initiation, Requests for Information were also sent to Livingston Inc. and Picker International Canada Inc., who were identified as potential importers of the Bracco and the Nycomed products, respectively.

All three companies identified as the importers, BDCI, MCI and Nycomed Amersham

Canada Ltd., responded to the Requests for Information. Of the two companies identified as potential importers, Livingston Inc., the service provider for Bracco products, submitted a partial response to the Request for Information. Picker International Canada Inc., the service provider for the Nycomed products, elected not to provide a response to the Request for Information, submitting that it was not the importer of the subject goods.

For the purposes of the preliminary investigation, on-site verification visits were conducted at the premises of BDI and Nycomed Inc. in Princeton, NJ. Verification visits were also made to three companies in Canada: BDCI, MCI and Nycomed Amersham Canada Ltd.

Based on the information obtained during the preliminary investigation, it was determined that the exporter of the Bracco products is Bristol-Myers Squibb Company (BMS) in Princeton, NJ, the manufacturer of the subject contrast media who shipped the goods to Canada. In the case of the Nycomed products, it was determined that the exporter is Searle Ltd. in Barceloneta,

Puerto Rico, the company who produced the goods and delivered them to the docks in

Puerto Rico for direct shipment to Canada. Nycomed Inc., in Princeton, NJ, was the exporter in the case of a single shipment made in late 1998 when the subject goods could not be shipped out of Puerto Rico during a hurricane. With respect to Mallinckrodt products, as indicated, a submission was not received from the company. However, based on available information, the CCRA is satisfied that Mallinckrodt Inc. is the manufacturer, vendor and exporter of the subject goods shipped to its Canadian subsidiary during the period of investigation.

The CCRA is also satisfied that during the entire period of investigation from July 1998 to

June 1999, the importer of the Bracco products was Bracco Diagnostics Canada Inc. and the importer of Mallinckrodt products was MCI. Further, the importer in Canada of the Nycomed products from July to December 1998, was Picker International Canada Inc., and the importer from January to June 1999, was Nycomed Amersham Canada Ltd.

Final Determination

For the final determination, Searle Ltd.'s late submission received during the preliminary determination phase of the investigation was reviewed and taken into consideration.

Mallinckrodt Inc.'s response to the Request for Information was received late in the final determination phase of the investigation and was not taken into consideration.

Subsequent to the preliminary determination, BMS was sent an exporter's Request for Information. BMS submitted that it was not the exporter of the goods and that BDI should respond to the Request for Information as the exporter. The CCRA advised BMS of the significance of a full response as the identified exporter of the Bracco products. However, the company failed to provide a response to the Request for Information.

Further representation was made by BDI, submitting that it was the exporter of the Bracco products. As a result, the facts relating to this issue were carefully re-examined. However, the

CCRA was not persuaded by the arguments made and again concluded that BMS was the exporter of the Bracco products.

Normal Value, Export Price and Margin of Dumping

The primary methods for determining normal value under SIMA are on the basis of the exporter's domestic sales, or if those sales cannot be used, on the basis of the sum of the cost of producing and selling the goods and an amount for profit. In circumstances where the like goods are sold primarily for export or where they are sold primarily to related parties, the domestic sales of like goods by other vendors may be used for determining the normal values of the subject goods.

The export price of the goods shipped to Canada is generally the exporter's selling price to the importer in Canada less all costs, charges and expenses arising from the exportation of the goods. In certain circumstances, where there is no selling price or the sale is between associated parties, the export price may be determined on the basis of the selling price in Canada less an amount to cover the importer's profit and the costs associated with the importation and sale of the goods in Canada, and the costs, charges and expenses arising from the exportation and shipment of the goods.

Where the export price is less than the normal value, the difference is the margin of dumping.

In circumstances where exporters do not cooperate with the CCRA in the conduct of its investigations, the goods exported by these exporters are deemed to have been dumped by the highest margin of dumping found among cooperating exporters, whose information was used to determine the normal values of the goods. In this investigation, two exporters, Nycomed Inc. and Searle Ltd., cooperated fully and provided information. However, only Nycomed Inc.'s information was used to determine the normal values of the goods. Searle Ltd.'s information was not used for reasons explained in the Results by Exporter section.

Therefore, the goods exported by non-cooperating exporters were found to have been dumped by the highest margin of dumping found for Nycomed Inc., the only exporter whose information was used to determine the normal values of like goods. The highest margin of dumping for Nycomed Inc., was 74 per cent, expressed as a percentage of the normal value. This percentage, expressed as a percentage of the export price, is 285 per cent.

Results By Exporter

The results of the investigation as well as the normal value, export price and the margin of dumping calculations for each exporter follow:

Bristol-Myers Squibb Company, Princeton, New Jersey

BMS is the manufacturer and exporter of the subject contrast media marketed by the Bracco group under the trade name Isovue. A Request for Information was forwarded to this company by BDI shortly after initiation of the investigation. However, BMS did not provide a response to the Request for Information or respond to subsequent enquiries by the CCRA.

Following the preliminary determination, a Request for Information was sent directly to BMS. The company elected not to respond to the Request for Information. Instead, BMS submitted that it was not the exporter of the subject goods. The company argued that it merely performs certain tolling functions for Bracco Diagnostics Inc. (BDI) and does not take title to either the raw material (iopamidol) or the finished product. BMS claims that it delivers the finished goods to Canada on behalf of BDI and therefore BDI is, in effect, the exporter.

Notwithstanding BMS's submission, the fact remains that the company failed to provide the requested information. A complete response would have afforded an opportunity for the verification of the company's information and enabled the CCRA to further examine BMS's claim that that it was not the exporter. In the absence of information from BMS, the CCRA maintains its position that BMS is the exporter of Bracco's products. This decision is based on the facts of the case and the activities and functions performed by the various parties involved.

Normal Value

Since BMS failed to provide requested information, for the purposes of the final determination, the normal value of the subject goods exported by BMS during the period of investigation is established by a ministerial specification pursuant to subsection 29(1) of SIMA. The specification specifies the normal value to be the export price, determined under section 24 or 25 of SIMA, plus an amount equal to 285 per cent of the export price. This percentage represents the highest margin of dumping found for the final determination as explained in the Normal Value, Export Price and Margin of Dumping section.

Export Price

The exporter, BMS, manufactures the Bracco products and ships them to the different markets in accordance with a distribution services agreement with BDI. As such, the subject goods are not sold by BMS to the importer in Canada and, therefore, there was no exporter's selling price for the subject goods. The goods are imported and stored in the service provider's warehouse until sold to the end-user in Canada. In the circumstances, the export prices were determined pursuant to section 25 of SIMA on the basis of the selling prices of the Bracco product to the end-users in Canada, less an amount to cover the importer's profit and the costs incurred on or after the importation and sale of the goods in Canada, and the costs, charges and expenses arising from the exportation and shipment of the goods.

Margin of Dumping

In view of the fact that BMS did not cooperate with the CCRA in the conduct of its investigation, subject goods exported to Canada by the company during the period of investigation were found to have been dumped by the highest margin of dumping found for the only cooperating exporter in the investigation, Nycomed Inc. The highest margin of dumping found for the final determination is 74 per cent expressed as a percentage of the normal value. This margin of dumping is equivalent to 285 per cent when expressed as a percentage of the export price.

Mallinckrodt Inc., St-Louis, Missouri

Mallinckrodt Inc. is a manufacturer, vendor and exporter of the subject contrast media. This company is also the parent company of the Canadian complainant. While Mallinckrodt Inc. did not provide a response during the preliminary determination phase of the investigation, its confidential response was received late in the final determination phase. The late submission did not allow sufficient time for the analysis and verification of the information submitted and it was not taken into account for the final determination.

Normal Value

In the absence of a timely submission from Mallinckrodt Inc., for the purposes of the final determination, the normal value of the subject goods exported by Mallinckrodt Inc. during the period of investigation is established by a ministerial specification pursuant to subsection 29(1) of SIMA. The specification specifies the normal value to be the export price, determined under section 24 or 25 of SIMA, plus an amount equal to 285 per cent of the export price. This percentage represents the highest margin of dumping found for the final determination as explained in the Normal Value, Export Price and Margin of Dumping section.

Export Price

The exporter, Mallinckrodt Inc, is the parent company of the Canadian importer,

Mallinckrodt Canada Inc. Since the exporter and the importer are related, export prices were determined pursuant to section 25 of SIMA on the basis of the selling prices of Mallinckrodt Inc.'s products to the end-users in Canada, less an amount to cover the importer's profit and the costs incurred on or after the importation and sale of the goods in Canada, and the costs, charges and expenses arising from the exportation and shipment of the goods.

Margin of Dumping

In view of the fact that Mallinckrodt Inc. failed to provide requested information in sufficient time to be considered for the final determination, subject goods exported to Canada by the company during the period of investigation were found to have been dumped by the highest margin of dumping found for the only cooperating exporter in the investigation, Nycomed Inc. The highest margin of dumping found for the final determination is 74 per cent expressed as a percentage of the normal value. This margin of dumping is equivalent to 285 per cent when expressed as a percentage of the export price.

Nycomed Inc., Princeton, New jersey

Nycomed Inc. does not normally export the subject goods to Canada. However, during the period of investigation, it did export a quantity of the subject goods to Canada when the Nycomed products could not be shipped out of Puerto Rico due to a hurricane. During the preliminary phase of the investigation, while Nycomed Inc. responded to the Request for Information, the CCRA held that essential information concerning the company's specific exports to Canada was not provided. Consequently, for the preliminary determination,

Nycomed Inc.'s exports to Canada were estimated to have been dumped by the highest estimated margin of dumping determined for the preliminary determination. The CCRA is now satisfied with the additional details provided by the company concerning the documentation for its exports to Canada.

Normal Value

The normal value of the subject goods exported by Nycomed Inc. was determined on the basis of profitable domestic sales of like goods to unrelated end-users belonging to those purchasing group organizations identified as the most comparable to the buying groups in Canada. The normal values were determined on the basis of the list prices which are representative of the prices at which the like goods were sold during the period of July 1, 1998 to June 30, 1999, pursuant to section 15 of SIMA. Adjustments to the domestic selling prices were made for the weighted average rebates granted in accordance with regulation 6 of the Special Import Measures Regulations (SIMR) and for delivery costs pursuant to regulation 7.

Export Price

There were no exporter's selling prices for the subject goods. Therefore, export prices were determined pursuant to section 25 of SIMA on the basis of the selling prices of the Nycomed products to the end-users in Canada, less an amount to cover the importer's profit and the costs incurred on or after the importation and sale of the goods in Canada, and the costs, charges and expenses arising from the exportation and shipment of the goods.

Margin of Dumping

All of the goods exported to Canada by Nycomed Inc. during the period of investigation, were found to have been dumped. The weighted average margin of dumping was 56 per cent, expressed as a percentage of normal value. The margins of dumping ranged from 46 per cent to 74 per cent.

Searle Ltd., Barceloneta, Puerto Rico

Searle Ltd., Puerto Rico, is the manufacturer and exporter of the subject contrast media marketed by the Nycomed group under the brand names Omnipaque and Visipaque. This company was sent a Request for Information at the initiation of the investigation, but its response was received too late to be considered for the purposes of the preliminary determination.

Subsequent analysis of Searle's submission indicates that the company produces the goods in accordance with a supply agreement with Nycomed Imaging, AS, Norway. Searle Ltd., therefore, produces the goods and sells the goods only to Nycomed Imaging, AS, in Norway. The goods sold to Nycomed Imaging, AS, are shipped directly from Puerto Rico to the Canadian, United States and Latin American markets.

During the period July to December 1998, the subject goods exported by Searle Ltd., were sold by Nycomed Imaging, AS, to the importer in Canada, Picker International Canada Inc. During the period January to June 1999, the subject goods exported by Searle Ltd., were sold by Nycomed Imaging, AS, to its related importer in Canada, Nycomed Amersham Canada Ltd.

Normal Value

As Searle Ltd. did not have domestic sales of like goods, its normal values could not be determined pursuant to section 15 of SIMA. Further, the normal values could not be determined using a constructed cost approach under paragraph 19(b) of SIMA since it was not possible to determine a reasonable amount for profits and a reasonable amount for administrative, selling and all other costs as set out in paragraphs 11(1)(b) and 11(1)(c) of the SIMR. These amounts have to be determined on the basis of either the exporter's or other producers' domestic sales of like goods or, goods of the same general category, or goods that are of the group or range of goods that is the next largest to the goods of the same general category. However, it is not possible to determine these amounts as the exporter, Searle Ltd., does not sell these products domestically and information from other producers is not available.

The normal values of subject goods exported by Searle Ltd. were, therefore, determined by a ministerial specification pursuant to section 29 of SIMA based on sales by another vendor of like goods in the United States of America, as selected by the CCRA, Nycomed Inc. The resultant normal values were determined on the basis of profitable domestic sales of like goods by Nycomed Inc., to unrelated end-users belonging to those Purchasing Group Organizations identified as the most comparable to the buying groups in Canada. The normal values were determined on the basis of the list prices which are representative of the prices at which the like goods were sold during the period of July 1, 1998 to June 30, 1999, pursuant to section 15 of SIMA. Adjustments to the domestic selling prices were made for the weighted average rebates granted in accordance with regulation 6 of the SIMR and for delivery costs pursuant to regulation 7.

Export Price

Searle Ltd. sells the goods to Nycomed Imaging, AS, in Norway, in accordance with its supply agreement. As there were no exporter's selling prices for the subject goods to the importer in Canada, export prices were determined pursuant to section 25 of SIMA on the basis of the selling prices of the Nycomed products to the end-users in Canada, less an amount to cover the importer's profit and the costs incurred on or after the importation and sale of the goods in Canada, and the costs, charges and expenses arising from the exportation and shipment of the goods.

Margin of Dumping

All of the goods exported to Canada by Searle Ltd. during the period of investigation, were found to have been dumped. The weighted average margin of dumping was 66 per cent, expressed as a percentage of normal value. The margins of dumping ranged from 9 per cent to 82 per cent.

Summary of Results

A summary of the margins of dumping for all exporters of subject goods is contained in Appendix 4. The overall weighted average margin of dumping of the dumped goods was 69 per cent, expressed as a percentage of normal value.

Representations Concerning the Investigation

At the initiation of the investigation, interested parties were invited to file written submissions on the question of the alleged dumping and injury. In response, information and representations were received from each of the legal counsel representing the Bracco and Nycomed groups of companies.

Nycomed's representations concerned a number of issues including the following: that the investigation should be terminated with respect to negligible exports by Nycomed Inc.; that

Puerto Rico and the United States of America are separate countries of export and that normal values should not be determined by references to sales in the United States of America; that Nycomed Imaging, AS should be considered the manufacturer for purposes of determining the normal values of the goods; that the CCRA should take into account the market differences due to the activities of the Patented Medicine Price Review Board in Canada; and, that the exporter need not be located in the country of export. Bracco also argued that the exporter need not be located in the country of export. The CCRA carefully examined these issues and representations and they were fully addressed in the Statement of Reasons issued for the preliminary determination.

Following the preliminary determination, further representations were received from legal counsel representing the Bracco group of companies. It was submitted that BDCI, the importer, was the exporter of the goods and, in the event that the CCRA did not accept that BDCI was the exporter, that BDI in the United States was the exporter and manufacturer of the subject goods.

It was also submitted that normal values of the Bracco products should be established primarily on the basis of BDI's domestic sales or on a constructed cost basis, using the raw material costs and the tolling cost as the cost of producing the goods.

After careful consideration of the representations, the CCRA is not persuaded by counsel's arguments and maintains that the exporter of the Bracco products is Bristol-Myers Squibb Co. The exporter did not cooperate with the CCRA in this investigation and did not respond to the Request for Information sent to it directly subsequent to the preliminary determination.

Subsequent to the preliminary determination, legal counsel for the Nycomed group of companies alleged that the preliminary decision breached the World Trade Organization Agreement on the Implementation of Article VI of the General Agreement on Tariffs and Trade, 1994

(Anti-dumping Agreement) in that the CCRA made an improper estimate of normal values and that the estimates of margin of dumping were exaggerated. The submissions claimed that the CCRA failed to consider that the United States of America and Puerto Rico are two separate markets, the CCRA did not make a proper comparison in Puerto Rico between the cost of producing the goods plus an amount for profit and its export prices, and the CCRA used distorted and unreasonable data to estimate the margin of dumping.

With respect to Nycomed's representations, the CCRA notes that Searle Ltd. is the exporter of the Nycomed products and that the allegations made by legal counsel for the Nycomed group concern the normal values and margins of dumping made with respect to the exporter,

Searle Ltd. In this regard, neither the Nycomed group of companies or its legal counsel represent the exporter, Searle Ltd., in this investigation.

Notwithstanding this clarification, the CCRA decisions made in this investigation are in accordance with the legislative provisions of SIMA. Further, the CCRA conducts its investigations in a fair and equitable manner consistent with Canada's obligations under the Anti-dumping Agreement.

The CCRA maintains that the domestic market of the United States includes the Commonwealth of Puerto Rico. In international trade matters, Canada considers Puerto Rico to be part of the United States of America. This is evident from the North American Free Trade Agreement (NAFTA) in which the word 'territory' with respect to the United States includes Puerto Rico. In article 1902 of NAFTA, each party reserved the right to apply its anti-dumping and countervailing duty law to goods imported from the territory of any other party. In view of this provision, the treatment of goods from Puerto Rico in an anti-dumping investigation must be included as goods from the territory of the United States of America. The CCRA is, therefore, consistent with NAFTA in using sales in the domestic market of the United States of America for the determination of normal values.

Finally, legal counsel for the Nycomed group claimed that the CCRA erred in stating that the patent on the Visipaque product expired on October 5, 1999, and that the patent does not expire until 2008. It was further submitted that the fact that the Nycomed products were subject to review by the Patented Medicine Price Review Board (PMPRB) until October 1999, has a direct bearing on the correctness of the CCRA's determination of indications of past injury. However, the information available to the CCRA indicates the Visipaque product is not patented in Canada at this time. While there is conflicting information concerning the expiration of the patent on the Visipaque product, the CCRA does not agree with Nycomed's position. The expiration of the patent on the Visipaque product is not an issue in this investigation. As indicated in the Statement of Reasons issued for the preliminary determination, the CCRA had examined this issue in detail and had concluded that the Canadian prices of the subject contrast media were essentially determined by market forces and not influenced by the activities of the PMPRB.

DECISION

The investigation revealed that the subject goods have been dumped, that the margins of dumping are not insignificant, and that the actual volumes of dumped goods are not negligible. Accordingly, pursuant to paragraph 41(1) of SIMA, the Commissioner of Customs and Revenue has, on this date, made a final determination of dumping with respect to iodinated contrast media for radiographic imaging, in solutions of osmolality less than 900 mOsm/kg H₂O, originating in or exported from the United States of America (including the Commonwealth of Puerto Rico).

FUTURE ACTION AND GENERAL INFORMATION

The Canadian International Trade Tribunal

The Canadian International Trade Tribunal's inquiry concerning the question of injury to the Canadian industry is continuing and the Tribunal will issue its finding by May 1, 2000. Subject goods imported during the provisional period will continue to be assessed provisional duty as determined at the time of the preliminary determination. This provisional period began on the date of the preliminary determination, December 31, 1999, and will end on the date the Tribunal issues its finding.

If the Tribunal finds that the dumped goods have not caused injury and do not threaten to cause injury, all proceedings relating to this investigation will be terminated. In such circumstances, all provisional duty paid or security posted by importers will be returned and future importations will not be subject to anti-dumping duty.

If the Tribunal finds that the dumped goods have caused injury, the CCRA will determine the exact amount of anti-dumping duty owing on subject goods released from the CCRA's possession during the provisional period pursuant to section 55 of SIMA. If the provisional duty paid is in excess of the final amount of anti-dumping duty payable, the excess duty paid will be refunded. Importations released from the CCRA's possession after the date of the Tribunal's finding will be subject to anti-dumping duty equal to the margin of dumping, which is the amount by which the normal value exceeds the export price. If anti-dumping duty is payable, such duty is hereby demanded pursuant to section 11 of SIMA.

If the Tribunal finds that the dumped goods threaten to cause injury, all provisional duty paid or security posted by importers will be returned. However, importations released from the CCRA's possession after the date of the Tribunal's finding will be subject to anti-dumping duty equal to the margin of dumping. If anti-dumping duty is payable, such duty is hereby demanded pursuant to section 11 of SIMA.

Future Administration

If the Tribunal finds that the subject goods have caused injury, the CCRA may re-investigate the subject goods originating in or exported from the United States to finalize the amounts of anti-dumping duties payable on shipments released from customs' possession during the period from December 31, 1999, to the date of the Tribunal decision on injury. Requests for Information would be forwarded to parties concerned. Those exporters who provide complete responses and cooperate in the verification of the required information would receive specific normal values at the conclusion of the re-investigation, if the normal values are based on their information.

For shipments of subject goods released during the provisional period, the amount of anti-dumping duties payable would be based on the lesser of the margin of dumping found at the preliminary determination and the margin of dumping found at the conclusion of the re-investigation. As appropriate, any excess duties collected during the provisional period would be refunded.

The normal values established as the result of the re-investigation may also be applicable to future shipments of the subject goods. Any sales to Canada below these values would be subject to anti-dumping duty assessments on future shipments.

These values may also be used to resolve any requests for re-determination received with respect to shipments released subsequent to the date of the Tribunal's finding. In the absence of specific normal values, the ministerial specification signed at the final determination would be applied to resolve these requests for re-determination. The processing of these requests for re-determination could result in additional duties being requested or in refunds of duty. For those exporters who do not respond to the Request for Information, the highest margin of dumping found at the final determination would be applied to future shipments of subject goods to Canada.

Designation of Importer

It should be noted that the importer of record (often a non-resident who is responsible for regular customs' duties and taxes and other charges, e.g., brokerage, freight, etc.) may be different from the importer specified under SIMA.

The CCRA must determine, based on the information presented to customs at the time of importation, who is the importer in Canada of goods imported or to be imported into Canada on which anti-dumping duty or countervailing duty is payable or has been paid, or will be payable if the goods are imported. Generally speaking, the CCRA's position is that the person in Canada who purchases the goods or to whom the goods are consigned is, in reality, the importer and, therefore, is liable for any anti-dumping or countervailing duty assessment under SIMA.

The intent of SIMA is to ensure that the party in Canada who negotiated the terms and conditions of sale with the exporter and/or vendor is responsible for the liabilities related to the purchases.

At the preliminary determination, the Commissioner of Customs and Revenue specified the importer of the goods, pursuant to paragraph 38(1)(c) of SIMA. However, it is possible that the documents submitted to customs may show an inappropriate party as the purchaser or consignee. Under such circumstances, the CCRA will base the determination of who is the importer for anti-dumping duty purposes on the information on hand at the time of importation.

If there is a question as to which of two or more parties is the importer for SIMA purposes, or if the designated importer disagrees with the CCRA's determination of who is the importer, an assessment of anti-dumping duties will be made against the importer of record and the CCRA will immediately seek a ruling from the Tribunal, where the CCRA intends to challenge the status of the declared importer of record.

Federal Court or Binational Panel Review

Grounds For Request

The grounds for requesting a review by either the Federal Court of Appeal or a binational panel of a final determination made pursuant to paragraph 41(1)(a) of SIMA are the same. Specifically, a request or application may be made only on the grounds that the Commissioner of Customs and Revenue, in making the final determination:

• acted without jurisdiction, acted beyond the jurisdiction of the Commissioner or refused to exercise that jurisdiction;
• failed to observe a principle of natural justice, procedural fairness or other procedure that the Commissioner was required by law to observe;
• erred in law in making a decision, whether or not the error appears on the face of the record;
• based a decision on an erroneous finding of fact that the Commissioner made in a perverse or capricious manner or without regard for the material before the Commissioner;
• acted, or failed to act, by reason of fraud or perjured evidence; or
• acted in any other way that was contrary to law.

Procedures For Making A Request

A request under section 77.011 of SIMA for a binational panel review of a final determination of dumping must be made to the Canadian Secretary of the NAFTA Secretariat no later than 30 days after the date on which notice of the final determination is published in the Canada Gazette.

A request for binational panel review may only be made in respect of that part of the final determination that applies to goods of a NAFTA country.

Further information on requesting a binational panel review may be obtained by contacting the Canadian Secretary of the NAFTA Secretariat by telephone at (613) 992-9388, by fax at (613) 992-9392, or at the following address:

NAFTA Secretariat
Canadian Section
Royal Bank Centre
Suite 705, 90 Sparks Street
Ottawa, Ontario K1P 5B4
Canada

Alternatively, an application may be made, pursuant to section 96.1 of SIMA, to the Federal Court of Appeal to review and set aside the Commissioner's decision.

SIMA allows for judicial review of a final determination by the Federal Court of Appeal as it applies to goods of a NAFTA country only if no binational panel review is requested. Section 77.012 of SIMA states that an application for judicial review may not be made before the expiration of the 30 day time period for requesting a binational panel review. If a binational panel review is not requested, parties wishing to appeal to the Federal Court have a further 10 days to submit their application.

Any person wishing to make an application to the Federal Court of Appeal in respect of a decision that applies to goods of a NAFTA country must, within 20 days following the publication of the final determination in the Canada Gazette, publish a notice to that effect in the Canada Gazette and serve a Notice of Intent to Commence Judicial Review on all persons listed on the CCRA's service list, to the Canadian Secretary at the address noted above and the American Secretary at the following address:

NAFTA Secretariat
United States Section
Room 2061
Department of Commerce
Washington, D.C.
U.S.A. 20230

Telephone: (202) 474-5438
Fax: (202) 474-0148

Should a panel review under NAFTA be requested, any other person affected by the Commissioner's final determination as it applies to goods of a NAFTA country may participate in the panel review. To appear before a panel, one must first file a Notice of Appearance with the Canadian Secretary.

Additional information regarding the content of the Notice of Intent to Commence Judicial Review and the Notice of Appearance may be obtained from the Canadian Secretary at the address previously noted.

PUBLICATION

Notice of this final determination is being published in the Canada Gazette pursuant to paragraph 41(3)(a) of SIMA.

INFORMATION

This Statement of Reasons has been provided to persons directly interested in these proceedings. It is also available on the CCRA's website at:

www.cbsa-asfc.gc.ca/sima-lmsi/menu-eng.html.

A free copy may be obtained upon request.

For further information, please write to either Richard Chung or Ronald Medas at the following address:

Canada Customs and Revenue Agency
Anti-dumping and Countervailing Directorate
191 Laurier Avenue West, 19^th Floor,
Ottawa, Ontario K1A 0L5
Canada

These officers can also be reached by fax at (613) 954-2510 or at:

Officer	Telephone Number	E-mail
Richard Chung	(613) 954-7253	richard.chung@ccra-adrc.gc.ca
Ronald Medas	(613) 954-1664	ron.medas@ccra-adrc.gc.ca

 

R.A. Séguin
A/Director General
Anti-dumping and Countervailing Directorate

APPENDIX 1

EXPORTERS

Bristol-Myers Squibb Co.
P.O. Box 4500
Princeton, NJ
U.S.A. 08543-4500

Mallinckrodt Inc.
675 McDonnell Blvd.
P.O. Box 5840
St. Louis , MO
U.S.A. 63134

Nycomed Inc.
101 Carnegie Centre
Princeton, NJ
U.S.A. 08540-6231

Searle Ltd.
P.O. Box 11247
Barceloneta
Route 140 LM 64.4
Puerto Rico
U.S.A. 00617-1247

APPENDIX 2

IMPORTERS

Bracco Diagnostics Canada Inc.
2600 Skymark Avenue #103, Unit 11
Mississauga, Ontario
L4W 5B2

Malinckrodt Canada Inc.
7500 Trans-Canada Highway
Pointe Claire, Quebec
H9R 5H8

Nycomed Amersham Canada Ltd.
1166 South Service Road West
Oakville, Ontario
L6L 5T7

Picker International Canada Inc.
7956 Torbram Road, Suite 21
Brampton, Ontario
L6T 5A2

APPENDIX 3

INTERESTED PARTIES

Bracco Diagnostics Inc.
P.O. Box 5225
Princeton, NJ
U.S.A 08543-5225

Nycomed Imaging, AS
C/O Nycomed Inc.
101 Carnegie Centre
Princeton, NJ
U.S.A. 08540

Livingston Inc.
1453 Cornwall Road
Oakville, Ontario
L6J 7T5

APPENDIX 4

MARGINS OF DUMPING, BY EXPORTER,

OF CERTAIN X-RAY IODINATED CONTRAST MEDIA FROM THE UNITED STATES OF AMERICA (INCLUDING THE COMMONWEALTH OF PUERTO RICO)

(July 1, 1998 to June 30, 1999)

Exporter	Quantity of Goods Dumped (%)	Margin of Dumping Range (%)	Weighted Average Margin of Dumping (%)
Bristol-Myers Squibb Co.1	100	74	74
Mallinckrodt Inc.2	100	74	74
Nycomed Inc.	100	46 to 74	56
Searle Ltd.	100	9 to 82	66
Weighted Average For All Exporters			69