[Federal Register Volume 63, Number 15 (Friday, January 23, 1998)]
[Notices]
[Pages 3536-3539]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-1537]
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DEPARTMENT OF COMMERCE
International Trade Administration
[A-533-810]
Stainless Steel Bar from India: Preliminary Results of New
Shipper Antidumping Duty Administrative Review
AGENCY: Import Administration, International Trade Administration,
Department of Commerce.
ACTION: Notice of preliminary results of New Shipper Antidumping Duty
Administrative Review: Stainless Steel Bar from India.
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SUMMARY: In response to requests from M/s Panchmahal Steels, Ltd. and
Ferro Alloys Corporation Limited, the Department of Commerce is
conducting a new shipper administrative review of the antidumping duty
order on stainless steel bar from India. This review covers M/s
Panchmahal Steels, Limited's and Ferro Alloys Corporation Limited's
sales of the subject merchandise to the United States during the period
February 1, 1996 through January 31, 1997.
We have preliminarily determined that M/s Panchmahal Steels, Ltd.'s
sales have been made below normal value and that Ferro Alloys
Corporation Limited's sales have not been made below normal value. If
these preliminary results are adopted in our final results of new
shipper administrative review, we will instruct the U.S. Customs
Service to assess antidumping duties equal to the difference between
the export price and the normal value.
Interested parties are invited to comment on these preliminary
results. Parties who submit argument are requested to submit with the
argument (1) a statement of the issue and (2) a brief summary of the
argument.
EFFECTIVE DATE: January 23, 1998.
FOR FURTHER INFORMATION CONTACT: Craig Matney or Zak Smith, Office 1,
[[Page 3537]]
Import Administration, International Trade Administration, U.S.
Department of Commerce, 14th Street and Constitution Avenue, N.W.,
Washington D.C. 20230; telephone (202) 482-0588 or (202) 482-1279,
respectively.
Applicable Statute
Unless otherwise indicated, all citations to the statute are
references to the provisions effective January 1, 1995, the effective
date of the amendments made to the Tariff Act of 1930 (``the Act'') by
the Uruguay Round Agreements Act.
SUPPLEMENTARY INFORMATION:
Background
On February 24 and February 27, 1997, the Department of Commerce
(``the Department'') received requests from respondents to conduct a
new shipper administrative review of the antidumping duty order on
stainless steel bar from India produced by M/s Panchmahal Steels, Ltd.
(``Panchmahal'') and Ferro Alloys Corporation Limited (``Facor''),
respectively. The Department published in the Federal Register, on
March 28, 1997, a notice of initiation of a new shipper administrative
review of Panchmahal and Facor covering the period August 1, 1996,
through January 31, 1997 (62 FR 14886). On September 17, 1997, the
Department published in the Federal Register a notice of extension of
time limit for this new shipper administrative review (62 FR 48811).
This notice extended the time for completion of these preliminary
results to no later than January 14, 1998.
Scope of Review
Imports covered by this review are shipments of stainless steel bar
(``SSB''). SSB means articles of stainless steel in straight lengths
that have been either hot-rolled, forged, turned, cold-drawn, cold-
rolled or otherwise cold-finished, or ground, having a uniform solid
cross section along their whole length in the shape of circles,
segments of circles, ovals, rectangles (including squares), triangles,
hexagons, octagons, or other convex polygons. SSB includes cold-
finished SSBs that are turned or ground in straight lengths, whether
produced from hot-rolled bar or from straightened and cut rod or wire,
and reinforcing bars that have indentations, ribs, grooves, or other
deformations produced during the rolling process.
Except as specified above, the term does not include stainless
steel semi-finished products, cut length flat-rolled products (i.e.,
cut length rolled products which if less than 4.75 mm in thickness have
a width measuring at least 10 times the thickness, or if 4.75 mm or
more in thickness having a width which exceeds 150 mm and measures at
least twice the thickness), wire (i.e., cold-formed products in coils,
of any uniform solid cross section along their whole length, which do
not conform to the definition of flat-rolled products), and angles,
shapes and sections.
The SSB subject to these orders is currently classifiable under
subheadings 7222.10.0005, 7222.10.0050, 7222.20.0005, 7222.20.0045,
7222.20.0075, and 7222.30.0000 of the Harmonized Tariff Schedule of the
United States (``HTSUS''). Although the HTSUS subheadings are provided
for convenience and customs purposes, our written description of the
scope of this order is dispositive.
Period of Review
This review covers two manufacturers/exporters, Panchmahal and
Facor, and the period February 1, 1996 through January 31, 1997. The
initiation notice incorrectly stated the period of review as August 1,
1996 through January 31, 1997.
Date of Sale
The Department's April 21, 1997, questionnaire instructed
respondents to use the invoice date as date of sale. It further
instructed respondent to contact the Department if the exporter
believed that there was another situation present that would make using
the date of invoice inappropriate. Facor made a written submission to
the Department on June 9, 1997, claiming that the purchase order date
was the appropriate date of sale, because that is the date on which the
material terms of sale are set. On June 12, 1997, the Department agreed
that Facor may report its sales to the United States based on purchase
order date.
Petitioners objected to the Department's date of sale decision.
Petitioners claimed that our decision in Wire Rod from India (62 FR
38976, July 21, 1997) allows only two exceptions (i.e., sales made on
the basis of long-term contracts and sales made with a long lag time)
to the rule of using invoice date as date of sale, and that Facor did
not meet either one. We conducted a further analysis of the information
on the record and concluded that the purchase order date is the
appropriate date of sale because the material terms of sale were set at
this time and no material changes occurred between the purchase order
date and the invoice date (see, Memorandum to Richard W. Moreland from
Susan Kuhbach, November 14, 1997).
United States Price
In calculating the price to the United States, we used export price
(``EP''), in accordance with section 772(a) of the Act, because the
subject merchandise was sold directly to the first unaffiliated
purchaser in the United States prior to importation into the United
States and constructed export price was not otherwise indicated.
We calculated EP based on either the CIF or cost and freight
(``CFR'') price to the United States. In accordance with section
772(c)(2) of the Act, we made deductions for foreign inland freight and
international freight.
Panchmahal claimed an upward adjustment to EP for a ``duty
drawback'' program. In the preliminary results of the first
administrative review of this order, we analyzed the functioning of
this duty drawback program and found that it did not meet the
Department's criteria for an upward adjustment to EP (see, 62 FR 10540
at 10541, March 7, 1997). We maintained our position in the final
results (see, 62 FR 37030, July 10, 1997). We have reexamined the
program in regard to Panchmahal, and have found no reason to deviate
from our previous decision. As stated in Certain Welded Carbon Standard
Steel Pipes and Tubes from India (62 FR 47632 at 47635, September 10,
1997), ``we determine whether an adjustment to U.S. price for a
respondent's claimed duty drawback is appropriate when the respondent
can demonstrate that it meets both parts of our two-part test. There
must be: (1) A sufficient link between the import duty and the rebate,
and (2) a sufficient amount of raw materials imported and used in the
production of the final exported product.'' Because Panchmahal did not
demonstrate a sufficient link between the import duty and the rebate,
we have not made an adjustment to EP.
Normal Value
In order to determine whether there was a sufficient volume of
sales in the home market to serve as a viable basis for calculating NV,
we compared respondent's volume of home market sales of the foreign
like product to the volume of U.S. sales of the subject merchandise, in
accordance with section 773(a) of the Act. Because the aggregate volume
of home market sales of the foreign like product was greater than five
percent of the aggregate volume of U.S. sales of the subject
merchandise, we determined that the home market provides a viable basis
for calculating NV. Therefore, in accordance with section
773(a)(1)(B)(i) of the Act, we based NV on the prices
[[Page 3538]]
at which the foreign like product was first sold to unaffiliated
customers for consumption in the exporting country, in the usual
commercial quantities and in the ordinary course of trade.
Level of Trade
In accordance with section 773(a)(1)(B) of the Act, to the extent
practicable, we determine NV based on sales in the comparison market at
the same level of trade (``LOT'') as the EP or CEP transaction. The NV
LOT is that of the starting-price sales in the comparison market or,
when NV is based on constructed value, that of the sales from which we
derive selling, general and administrative expenses and profit. For EP,
the U.S. LOT is also the level of the starting-price sale, which is
usually from exporter to importer. For CEP, it is the level of the
constructed sale from the exporter to the importer.
To determine whether NV sales are at a different LOT than EP or
CEP, we examine stages in the marketing process and selling functions
along the chain of distribution between the producer and the
unaffiliated customer. If the comparison-market sales are at a
different LOT, and the difference affects price comparability, as
manifested in a pattern of consistent price differences between the
sales on which NV is based and comparison-market sales at the LOT of
the export transaction, we make an LOT adjustment under section
773(a)(7)(A) of the Act. Finally, for CEP sales, if the NV level is
more remote from the factory than the CEP level and there is no basis
for determining whether the difference in the levels between NV and CEP
affects price comparability, we adjust NV under section 773(a)(7)(B) of
the Act (the CEP offset provision). See, Notice of Final Determination
of Sales at Less Than Fair Value: Certain Cut-to-Length Carbon Steel
Plate from South Africa, 62 FR 61731 (November 19, 1997).
In implementing these principles in this review, we reviewed
information from each respondent regarding the marketing stage involved
in the reported home market and U.S. sales, including a description of
the selling activities performed by the respondents for each channel of
distribution. Pursuant to section 773(a)(1)(B)(i) of the Act and the
SAA at 827, in identifying levels of trade for EP and home market sales
we considered the selling functions reflected in the starting prices
before any adjustments. We expect that, if claimed levels of trade are
the same, the functions and activities of the seller should be similar.
Conversely, if a party claims that levels of trade are different for
different groups of sales, the functions and activities of the seller
should be dissimilar.
Based on an analysis of the selling functions, class of customers,
and level of selling expenses, we found that the marketing process in
both the home market and the United States were not substantially
dissimilar for either Panchmahal or Facor. Therefore, we have
preliminarily found that sales in both markets are at the same LOT and
consequently no LOT adjustment is warranted.
Cost of Production Analysis
Based on a cost allegation presented by petitioners, the Department
found reasonable grounds to believe or suspect that sales by Facor in
the home market were made at the prices below their respective costs of
production (``COPs''). As a result, the Department initiated an
investigation to determine whether Facor made home market sales during
the POR at prices below its COP, within the meaning of section 773(b)
of the Act.
We conducted the COP analysis described below.
A. Calculation of COP
In accordance with section 773(b)(3) of the Act, we calculated the
weighted-average COP, by model, based on the sum of the cost of
materials, fabrication, selling, general and administrative expenses,
and packing costs.
B. Results of the COP Test
Pursuant to section 773(b)(2)(C), where less than 20 percent of a
respondent's sales of a given product were made at prices below the
COP, we did not disregard any below-cost sales of that product because
we determined that the below-cost sales were not made in ``substantial
quantities.'' Where 20 percent or more of Facor's sales of a given
product were made at prices below the COP, we disregarded the below-
cost sales because such sales were found to be made within an extended
period of time in ``substantial quantities'' in accordance with
sections 773(b)(2)(B) and (C) of the Act. Moreover, based on
comparisons of price to weighted-average COPs for the POR, we
determined that the below-cost sales of the product were at prices
which would not permit recovery of all costs within a reasonable period
of time, in accordance with section 773(b)(2)(D) of the Act.
We found that Facor made home market sales at below COP prices
within an extended period of time in substantial quantities. Further,
we found that these sales prices did not permit for the recovery of
costs within a reasonable period of time. We therefore excluded these
sales from our analysis in accordance with section 773(b)(1) of the
Act.
Preliminary Results of the Review
As a result of our comparison of EP and NV, we preliminarily
determine the following weighted-average dumping margins:
------------------------------------------------------------------------
Margin
Manufacturer/exporter Period (percent)
------------------------------------------------------------------------
Panchmahal.......................... 2/1/96-1/31/97 0.69
Facor............................... 2/1/96-1/31/97 ................
------------------------------------------------------------------------
Parties to the proceeding may request disclosure within five days
of the date of publication of this notice. Any interested party may
request a hearing within 10 days of publication. Any hearing, if
requested, will be held 44 days after the publication of this notice,
or the first workday thereafter. Interested parties may submit case
briefs within 30 days of the date of publication of this notice.
Rebuttal briefs, which must be limited to issues raised in the case
briefs, may be filed not later than 37 days after the date of
publication of this notice. The Department will issue the final results
of this administrative review, which will include the results of its
analysis of issues raised in any such comments, within 90 days of
issuance of these preliminary results.
Upon completion of this new shipper administrative review, the
Department shall determine, and the U.S. Customs Service shall assess,
antidumping duties on all appropriate entries. Individual differences
between EP and NV may vary from the percentages stated above. We have
calculated an importer-specific duty assessment rate based on the ratio
of the total amount of AD duties calculated for the examined sales made
during the POR to the total value of subject merchandise entered during
the
[[Page 3539]]
POR. In order to estimate the entered value, we subtracted
international movement expenses (e.g., international freight) from the
gross sales value. This rate will be assessed uniformly on all entries
made during the POR. The Department will issue appraisement
instructions directly to the Customs Service.
The following deposit requirement will be effective upon
publication of the final results of this new shipper antidumping duty
administrative review for all shipments of stainless steel bar from
India entered, or withdrawn from warehouse, for consumption on or after
the publication date, as provided for by section 751(a)(1) of the Act:
(1) The cash deposit rate for the reviewed companies will be the rates
established in the final results of this review; (2) if the exporter is
not a firm covered in this review, but was covered in a previous review
or the original less-than-fair-value (``LTFV'') investigation, the cash
deposit rate will continue to be the company-specific rate published
for the most recent period; (3) if the exporter is not a firm covered
in this review, a previous review, or the original LTFV investigation,
but the manufacturer is, the cash deposit rate will be the rate
established for the most recent period for the manufacturer of the
merchandise; and (4) the cash deposit rate for all other manufacturers
and/or exporters of this merchandise, shall be 12.45 percent, the ``all
others'' rate established in the LTFV investigation (59 FR 66915,
December 28, 1994).
These requirements, when imposed, shall remain in effect until
publication of the final results of the next administrative review.
This notice also serves as a preliminary reminder to importers of
their responsibility under 19 CFR 353.26 to file a certificate
regarding the reimbursement of antidumping duties prior to liquidation
of the relevant entries during this review period. Failure to comply
with this requirement could result in the Secretary's presumption that
reimbursement of antidumping duties occurred and the subsequent
assessment of double antidumping duties.
This administrative review and notice are in accordance with
section 751(a)(1) of the Act (19 U.S.C. 1675(a)(1)) and 19 CFR
353.22(h).
Dated: January 13, 1998.
Robert S. LaRussa,
Assistant Secretary for Import Administration.
[FR Doc. 98-1537 Filed 1-22-98; 8:45 am]
BILLING CODE 3510-DS-P
