03-1902. Notice of Amended Final Results of Antidumping Duty Administrative Review: Stainless Steel Sheet and Strip in Coils from France

AGENCY:

Import Administration, International Trade Administration, Department of Commerce.

ACTION:

Notice of Amended Final Results of Antidumping Duty Administrative Review of Stainless Steel Sheet and Strip in Coils from France.

EFFECTIVE DATE:

January 28, 2003.

FOR FURTHER INFORMATION CONTACT:

Alex Villanueva, AD/CVD Enforcement Group III, Office IX, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, N.W., Washington, D.C. 20230; telephone: [phone].

SUPPLEMENTARY INFORMATION:

Scope of the Review

For purposes of this administrative review, the products covered are certain stainless steel sheet and strip in coils. Stainless steel is an alloy steel containing, by weight, 1.2 percent or less of carbon and 10.5 percent or more of chromium, with or without other elements. The subject sheet and strip is a flat-rolled product in coils that is greater than 9.5 mm in width and less than 4.75 mm in thickness, and that is annealed or otherwise heat treated and pickled or otherwise descaled. The subject sheet and strip may also be further processed (e.g., cold-rolled, polished, aluminized, coated, etc.) provided that it maintains the specific dimensions of sheet and strip following such processing.

The merchandise subject to this review is classified in the Harmonized Tariff Schedule of the United States (HTS) at subheadings: 7219.13.0031, 7219.13.0051, 7219.13.0071, 7219.1300.81¹, 7219.14.0030, 7219.14.0065, 7219.14.0090, 7219.32.0005, 7219.32.0020, 7219.32.0025, 7219.32.0035, 7219.32.0036, 7219.32.0038, 7219.32.0042, 7219.32.0044, 7219.33.0005, 7219.33.0020, 7219.33.0025, 7219.33.0035, 7219.33.0036, 7219.33.0038, 7219.33.0042, 7219.33.0044, 7219.34.0005, 7219.34.0020, 7219.34.0025, 7219.34.0030, 7219.34.0035, 7219.35.0005, 7219.35.0015, 7219.35.0030, 7219.35.0035, 7219.90.0010, 7219.90.0020, 7219.90.0025, 7219.90.0060, 7219.90.0080, 7220.12.1000, 7220.12.5000, 7220.20.1010, 7220.20.1015, 7220.20.1060, 7220.20.1080, 7220.20.6005, 7220.20.6010, 7220.20.6015, 7220.20.6060, 7220.20.6080, 7220.20.7005, 7220.20.7010, 7220.20.7015, 7220.20.7060, 7220.20.7080, 7220.20.8000, 7220.20.9030, 7220.20.9060, 7220.90.0010, 7220.90.0015, 7220.90.0060, and 7220.90.0080. Although the HTS subheadings are provided for convenience and Customs purposes, the Department's written description of the merchandise under review is dispositive.

Excluded from the scope of this review are the following: (1) sheet and strip that is not annealed or otherwise heat treated and pickled or otherwise descaled, (2) sheet and strip that is cut to length, (3) plate (i.e., flat-rolled stainless steel products of a thickness of 4.75 mm or more), (4) flat wire (i.e., cold-rolled sections, with a prepared edge, rectangular in shape, of a width of not more than 9.5 mm), and (5) razor blade steel. Razor blade steel is a flat-rolled product of stainless steel, not further worked than cold-rolled (cold-reduced), in coils, of a width of not more than 23 mm and a thickness of 0.266 mm or less, containing, by weight, 12.5 to 14.5 percent chromium, and certified at the time of entry to be used in the manufacture of razor blades. See Chapter 72 of the HTS, “Additional U.S. Note” 1(d).

In response to comments by interested parties, the Department has determined that certain specialty stainless steel products are also excluded from the scope of this review. These excluded products are described below.

Flapper valve steel is defined as stainless steel strip in coils containing, by weight, between 0.37 and 0.43 percent carbon, between 1.15 and 1.35 percent molybdenum, and between 0.20 and 0.80 percent manganese. This steel also contains, by weight, phosphorus of 0.025 percent or less, silicon of between 0.20 and 0.50 percent, and sulfur of 0.020 percent or less. The product is manufactured by means of vacuum arc remelting, with inclusion controls for sulphide of no more than 0.04 percent and for oxide of no more than 0.05 percent. Flapper valve steel has a tensile strength of between 210 and 300 ksi, yield strength of between 170 and 270 ksi, plus or minus 8 ksi, and a hardness (Hv) of between 460 and 590. Flapper valve steel is most commonly used to produce specialty flapper valves in compressors.

Also excluded is a product referred to as suspension foil, a specialty steel product used in the manufacture of suspension assemblies for computer disk drives. Suspension foil is described as 302/304 grade or 202 grade stainless steel of a thickness between 14 and 127 microns, with a thickness tolerance of plus-or-minus 2.01 microns, and surface glossiness of 200 to 700 percent Gs. Suspension foil must be supplied in coil widths of not more than 407 mm, and with a mass of 225 kg or less. Roll marks may only be visible on one side, with no scratches of measurable depth. The material must exhibit residual stresses of 2 mm maximum deflection, and flatness of 1.6 mm over 685 mm length.

Certain stainless steel foil for automotive catalytic converters is also excluded from the scope of this review. This stainless steel strip in coils is a specialty foil with a thickness of between 20 and 110 microns used to produce a metallic substrate with a honeycomb structure for use in automotive catalytic converters. The steel contains, by weight, carbon of no more than 0.030 percent, silicon of no more than 1.0 percent, manganese of no more than 1.0 percent, chromium of between 19 and 22 percent, aluminum of no less than 5.0 percent, phosphorus of no more than 0.045 percent, sulfur of no more than 0.03 percent, lanthanum of less than 0.002 or greater than 0.05 percent, and total rare earth elements of more than 0.06 percent, with the balance iron.

Permanent magnet iron-chromium-cobalt alloy stainless strip is also excluded from the scope of this review. This ductile stainless steel strip contains, by weight, 26 to 30 percent chromium, and 7 to 10 percent cobalt, with the remainder of iron, in widths 228.6 mm or less, and a thickness between 0.127 and 1.270 mm. It exhibits magnetic remanence between 9,000 and 12,000 gauss, and a coercivity of between 50 and 300 oersteds. This product is most commonly used in electronic sensors and is currently available under proprietary trade names such as “Arnokrome III.”²

Certain electrical resistance alloy steel is also excluded from the scope of this review. This product is defined as a non-magnetic stainless steel manufactured to American Society of Testing and Materials (“ASTM”) specification B344 and containing, by weight, 36 percent nickel, 18 percent chromium, and 46 percent iron, and is most notable for its resistance to high temperature corrosion. It has a melting point of 1390 degrees Celsius and displays a creep rupture limit of 4 kilograms per square millimeter at 1000 degrees Celsius. This steel is most commonly used in the production of heating ribbons for circuit breakers and industrial furnaces, and in rheostats for railway locomotives. The product is currently available under proprietary trade names such as “Gilphy 36.”³

Certain martensitic precipitation-hardenable stainless steel is also excluded from the scope of this review. This high-strength, ductile stainless steel product is designated under the Unified Numbering System (“UNS”) as S45500-grade steel, and contains, by weight, 11 to 13 percent chromium, and 7 to 10 percent nickel. Carbon, manganese, silicon and molybdenum each comprise, by weight, 0.05 percent or less, with phosphorus and sulfur each comprising, by weight, 0.03 percent or less. This steel has copper, niobium, and titanium added to achieve aging, and will exhibit yield strengths as high as 1700 Mpa and ultimate tensile strengths as high as 1750 Mpa after aging, with elongation percentages of 3 percent or less in 50 mm. It is generally provided in thicknesses between 0.635 and 0.787 mm, and in widths of 25.4 mm. This product is most commonly used in the manufacture of television tubes and is currently available under proprietary trade names such as “Durphynox 17.”⁴

Finally, three specialty stainless steels typically used in certain industrial blades and surgical and medical instruments are also excluded from the scope of this review. These include stainless steel strip in coils used in the production of textile cutting tools (e.g., carpet knives).^[5] This steel is similar to AISI grade 420 but containing, by weight, 0.5 to 0.7 percent of molybdenum. The steel also contains, by weight, carbon of between 1.0 and 1.1 percent, sulfur of 0.020 percent or less, and includes between 0.20 and 0.30 percent copper and between 0.20 and 0.50 percent cobalt. This steel is sold under proprietary names such as “GIN4 Mo.” The second excluded stainless steel strip in coils is similar to AISI 420-J2 and contains, by weight, carbon of between 0.62 and 0.70 percent, silicon of between 0.20 and 0.50 percent, manganese of between 0.45 and 0.80 percent, phosphorus of no more than 0.025 percent and sulfur of no more than 0.020 percent. This steel has a carbide density on average of 100 carbide particles per 100 square microns. An example of this product is “GIN5” steel. The third specialty steel has a chemical composition similar to AISI 420 F, with carbon of between 0.37 and 0.43 percent, molybdenum of between 1.15 and 1.35 percent, but lower manganese of between 0.20 and 0.80 percent, phosphorus of no more than 0.025 percent, silicon of between 0.20 and 0.50 percent, and sulfur of no more than 0.020 percent. This product is supplied with a hardness of more than Hv 500 guaranteed after customer processing, and is supplied as, for example, “GIN6”.⁶

Amendment of Final Results

On December 26, 2002, the Department of Commerce (“the Department”) published its final results for stainless steel sheet and strip in coils from France for the July 1, 2000, through June 30, 2001, period of review. See Notice of Final Results of Antidumping Duty Administrative Review: Stainless Steel Sheet and Strip in Coils From France: Stainless Steel Sheet and Strip From France (“Final Results”), 67 FR 78773 (December 26, 2002).

In accordance with 19 C.F.R. §351.224(c), on December 19, 2002, Ugine, S.A. (“Ugine”), a respondent in this administrative review, requested that the Department extend the deadline to file ministerial errors regarding the Final Results from December 24, 2002 to January 10, 2002. On December 20, 2002, the Department extended the deadline to file any ministerial allegations on the Final Results from December 24, 2002 to December 31, 2002. See Letter from the Department to Ugine, dated December 20, 2002. Consequently, on December 31, 2002, Ugine and the Petitioners⁷ timely filed an allegation that the Department made ministerial errors in the Final Results, pursuant to 19 C.F.R. §351.224(c). Ugine submitted rebuttal comments on January 6, 2003 in reply to the Petitioners' ministerial error allegations.

Arm's Length Test Program

The Petitioners contend that in its Final Results, the Department, in calculating the net price, inadvertently failed to consider both home market interest revenue (INTREVH) and home market commissions (COMMH). Thus, according to the Petitioners, the Department should revise its Final Results to add home market interest revenue and deduct home market commissions in calculating the net price in the arm's length test, consistent with its standard practice.

Model Match Program

The Petitioners note that the Department's model match program used for the Final Results, contained two errors. According to the Petitioners, in the model match program, the Department erred in calculating the home market net price because it did not add home market interest revenue (INTREVH) in the calculation. Therefore, the Petitioners assert, the Department should revise its home market net price calculation to add home market interest revenue in the model match program in accordance with its standard practice.

The Petitioners also argue that in its Final Results, the Department inadvertently failed to update the date of payment for unpaid sales (where PAYDTU/H equals “ ”). According to the Petitioners, the Department's standard policy in final administrative results is to update the date of payment for unpaid sales to the last day of each market's respective verifications and to recalculate credit expenses (CREDITU/H), as appropriate. See Notice of Final Determination of Sales at Less Than Fair Value: Structural Steal Beams from Italy and accompanying Issues and Decision Memorandum, dated May 20, 2002, at Comment 9. Therefore, the Petitioners argue that for home market sales this date of payment was June 21, 2002, and for U.S. market sales it was May 24, 2002. See Memorandum to the File from Alex Villanueva, Import Compliance Specialist, through James C. Doyle, Program Manager, Verification Report of the 2nd Administrative Review of Stainless Steel Sheet and Strip in Coils from France Home Market Sales and Cost Verification Report of Ugine, S.A. (“Home Market Verification Report”), dated July 31, 2002, at 1, and Memorandum to the File from Alex Villanueva and Jonathan Herzog, Import Compliance Specialists, through James C. Doyle, Program Manager, Verification Report of the 2nd Administrative Review of Stainless Steel Sheet and Strip in Coils from France U.S. Sales and Cost Verification Report of Ugine, S.A. (“U.S. Market Verification Report”), dated July 31, 2002 at 1. Thus, the Petitioners argue, the Department should revise its Final Results to update the date of payment for unpaid home market and U.S. market sales to the last day of verification in the model match program.

Margin Calculation Program

The Petitioners argue that in calculating the values that would be used to determine the Constructed Export Price (“CEP”) profit in the Final Results, the Department inadvertently mixed U.S. dollar-based variables with Euro-based variables without performing the proper conversion. The Petitioners note that this occurred when the Department calculated the cost of goods sold for U.S. sales when the Department combined the U.S. dollar-based further manufacturing, general and administrative expenses, interest expenses and packing expenses. Furthermore, the Petitioners note, the mixed-currency costs of good sold for U.S. sales was then added to the Euro-based home market costs of goods sold. Similarly, the Petitioners claim, the U.S. dollar-based revenue for U.S. sales was added to Euro-based revenue for home market sales. Finally, the Petitioners argue that the same error was performed with regard to selling expenses and movement expenses. The Petitioners argue that in order to correct for this error, the Department should convert all U.S. dollar-denominated variables (FURMANU, REVENU, SELLEXPU, MOVEXPU) to Euros in the margin calculation program.

In addition, the Petitioners argue that the Department failed to update the day of payment for unpaid sales (where PAYDTU/H equals “ ”) in the margin calculation program. According to the Petitioners, the Department's normal practice is to update the date of payment for unpaid sales to the last date of each verification and to recalculate credit expenses (CREDITU/H) appropriately. As noted above, the Petitioners argue, the last date of verification for home market sales was June 21, 2002, and for U.S. market sales was May 24, 2002. Thus, the Petitioners request that the Department revise its Final Results to update the date of payment for unpaid home market and U.S. market sales to the last day of verification for each respective market in the margin calculation program.

Ugine argues that in the Final Results, the Department attempted to take interest revenue into account when calculating the net U.S. price in the margin calculation program, but inserted the programming code incorrectly before the “End” statement. Therefore, to correct this error, Ugine requests that the Department revise its programming code to properly take into account the interest revenue when calculating the net U.S. price in the margin calculation program.

In their rebuttal comments, Ugine argues that the Petitioners' claim that the Department “inadvertently” used the same method for calculating credit expenses in both the preliminary and final results. According to Ugine, the Petitioners suggest that the Department intended to “update” the methodology by inserting an assumed payment date for sales for which payment had not been received and recalculating the reported credit expenses based on this assumed payment date in both the model match and the margin programs. Ugine notes, that the Department, however, gave no indication in its preliminary results or Final Results that it was contemplating the methodological change the Petitioners are now suggesting. Furthermore, Ugine argues, nor did the Petitioners raise this issue in their case brief or rebuttal brief. Consequently, Ugine notes, it is now too late for the Petitioners to advance this methodological change to the calculation after the Department has completed its Final Results.

In addition, Ugine argues that under the credit expense methodology used by the Department in its preliminary and Final Results, there is no basis for the Petitioners' suggested “update” to the calculations. According to Ugine, in the Department's preliminary results, credit expenses for those sales for which payment had not been received were calculated using an estimated credit period. Ugine asserts that the estimated credit period for these sales was based on the weighted-average credit period for sales during the reporting period for which payment dates were available. Ugine argues that the Petitioners' comments have not shown this methodology to be inaccurate or erroneous, and therefore, provide no basis for the Department to jettison this calculation methodology, even if these arguments were timely.

Finally, Ugine notes, that for U.S. sales made by Hague, the Petitioners' suggested “update” is simply inapplicable. According to Ugine, the credit period for all sales by Hague was determined based on an accounts-receivable turnover analysis because Hague was not able to identify the payment date for individual transactions. Therefore, Ugine argues, the fact that no payment date was reported for these sales does not mean that payment had not been received, but that is simply a function of the reporting methodology used by Hague. Ugine states that this methodology was verified by the Department without discrepancy and has been accepted by the Department in all prior reviews of this case. Accordingly, Ugine claims, even if the Department were to accept the Petitioners' comment, the credit expenses calculated for Hague's sales should not be affected.

Department's Position

We agree with Ugine and the Petitioners.

With regard to the Petitioners' argument regarding the treatment of interest revenue and commissions paid for home market sales in the arm's length test, we agree. In our Final Results, we inadvertently failed to consider both home market interest revenue (INTREVH) and home market commissions (COMMH) in calculating the net price. Thus, to correct for this error, we have revised our Final Results and added home market interest revenue and deducted home market commissions in calculating the net price in the arm's length test.

With regard to the Petitioners' argument that the Department erred in calculating the home market net price because we did not add home market interest revenue (INTREVH) to the calculation in the model match program, we agree. Therefore, for these amended final results, we correctly revised our home market net price calculation and added home market interest revenue in the model match program.

With regard to the Petitioners' argument that in calculating the values that would be used to determine the CEP profit in the Final Results, we mistakenly mixed U.S. dollar-based variables with Euro-based variables without performing the proper conversion in the margin calculation program, we agree. To correct for this error, we properly converted all U.S. dollar-denominated variables (FURMANU, REVENU, SELLEXPU, MOVEXPU) to Euros in the margin calculation program.

With regard to Ugine's argument that Department incorrectly applied the programming code to account for interest revenue when calculating the net U.S. price, we agree. We note that although the programming code is correct, it was inadvertently placed in the incorrect order, preventing the program from taking interest revenue into account when calculating the net U.S. price. For these amended final results, we have correctly applied the programming code to take interest revenue into account when calculating the net U.S. price in the margin calculation program.

With regard to the Petitioners' argument that we failed to update the date of payment for unpaid sales (where PAYDTU/H equals “ ”) in the margin and model match calculation programs, we disagree. It is the Department's standard practice to replace the date of payment with the last day of verification of that particular market (i.e., the last day of the home market verification should be used as the date of payment for unpaid home market sales and the last day of the U.S. market verification should be used as the date of payment for unpaid U.S. market sales). However, in the instant case, the home market sales have a date of payment. Ugine reported, as it has reported in the investigation and the first administrative review, an average payment date for its home market sales where payment had not yet been received. Additionally, credit expenses for those sales for which payment had not been received were calculated using a weighted-average credit period. Therefore, the Petitioners assertion that certain home market sales had no payment date is wrong. In addition, in our Final Results we did not intend to replace Ugine's average payment date methodology with the last day of the home market sales verification. Consequently, we are affirming our use of Ugine's average payment date for sales for which payment had not been received in the home market and are not changing our Final Results.

With regard to the Petitioners similar argument regarding sales where there was no date of payment (PAYDTU) in the U.S. market, we disagree. We agree with Ugine that the date of payment reported was based on an accounts-receivable turnover methodology because Hague was not able to identify the date of payment on a sales-specific basis. Furthermore, the credit period for sales made by Hague was determined based on this same methodology. At the U.S. market verification, we verified this methodology and found no discrepancies. See U.S. Market Verification Report at 18. This fact was not disputed by the Petitioners. Therefore, for the Final Results, we have not changed the date of payment used by Hague.

Therefore, we are amending the Final Results to reflect the correction of the above-cited ministerial errors. All changes made to the arm's length test, model match and margin program can be found in the analysis memorandum. See Memorandum to the File from Alex Villanueva, Senior Case Analyst to James C. Doyle, Program Manager, Final Analysis for Ugine S.A. for the Amended Final Results of the 2nd Administrative Review Stainless Steel Sheet and Strip in Coils from France for the period July 1, 2000 through June 30, 2001, dated January 20, 2003.

The weighted-average dumping margin is as follows:

Producer/Manufacturer Exporter	Final Weighted-Average ­Margin (percent)	Amended Final Weighted ­Average Margin (percent)
Ugine, S.A.	1.47	1.44

Consequently, we are issuing and publishing these amended final results and notice in accordance with sections 751(a)(1) of the Act.

Dated: January 17, 2002.

Faryar Shirzad,

Assistant Secretary for Import Administration.

Footnotes

1.  Due to changes to the HTS numbers in 2001, 7219.13.0030, 7219.13.0050, 7219.13.0070, and 7219.13.0080 are now 7219.13.0031, 7219.13.0051, 7219.13.0071, and 7219.13.0081, respectively.

2.  “Arnokrome III” is a trademark of the Arnold Engineering Company.

3.  “Gilphy 36” is a trademark of Imphy, S.A.

4.  “Durphynox 17” is a trademark of Imphy, S.A.

5.  This list of uses is illustrative and provided for descriptive purposes only.

6.  “GIN4 Mo,” “GIN5” and “GIN6” are the proprietary grades of Hitachi Metals America, Ltd.

7.  The Petitioners in this case are Allegheny Ludlum Corporation, AK Steel, Inc., North American Stainless, United Steelworkers of America, AFL-CIO/CLC, Butler Armco Independent Union and Zanesville Armco Independent Organization.