[Federal Register Volume 64, Number 198 (Thursday, October 14, 1999)]
[Notices]
[Pages 55697-55700]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-26721]
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DEPARTMENT OF COMMERCE
International Trade Administration
[A-570-820]
Certain Compact Ductile Iron Waterworks Fittings and Glands From
the People's Republic of China: Preliminary Results of Antidumping Duty
Administrative Review
AGENCY: Import Administration, International Trade Administration,
Department of Commerce.
SUMMARY: The Department of Commerce (``the Department'') is conducting
an administrative review of the antidumping duty order on Certain
Compact Ductile Iron Waterworks Fittings and Glands (``CDIW'') from the
People's Republic of China in response to requests by the respondent,
Beijing Metals and Minerals Import and Export Corporation, and its
Cheng Hong Foundry (collectively known as ``BMMIEC''). The period of
review is September 1, 1997, through August 31, 1998.
We have preliminarily determined that U.S. sales of subject
merchandise by BMMIEC have not been made below normal value. Since
BMMIEC submitted full responses to the antidumping questionnaire and it
has been established that it is sufficiently
[[Page 55698]]
independent, it is entitled to a separate rate.
If these preliminary results are adopted in our final results of
administrative review, we will instruct the U.S. Customs Service to
assess no antidumping duties on entries from BMMIEC.
Interested parties are invited to comment on these preliminary
results.
EFFECTIVE DATE: October 14, 1999.
FOR FURTHER INFORMATION CONTACT: Lyman Armstrong, Jim Terpstra or Paige
Rivas, AD/CVD Enforcement Group II, Office IV, Import Administration,
International Trade Administration, U.S. Department of Commerce, 14th
Street and Constitution Avenue, NW, Washington, DC 20230; telephone:
(202) 482-3601, (202) 482-3965, or (202) 482-0651 respectively.
SUPPLEMENTARY INFORMATION:
Applicable Statute and Regulations
Unless otherwise indicated, all citations to the Tariff Act of
1930, as amended (the Act), are references to the provisions effective
January 1, 1995, the effective date of the amendments made to the Act
by the Uruguay Round Agreements Act. In addition, unless otherwise
indicated, all citations to the Department's regulations are to the
regulations at 19 CFR part 351 (1998).
Background
The Department received a request for review from BMMIEC on
September 30, 1997. We published a notice of initiation of this review
on October 29, 1997 (63 FR 58010).
On December 1, 1998, we issued an antidumping questionnaire to
BMMIEC. The Department received responses to Section A on January 6,
1999 and Sections C and D on February 11, 1999.
We issued a supplemental questionnaire to BMMIEC on March 18, 1999.
The response to this supplemental questionnaire was received on April
12, 1999. On April 27, 1999, the Department issued a second
supplemental questionnaire to BMMIEC. The response to the second
supplemental questionnaire was received on May 5, 1999.
Under section 751(a)(3)(A) of the Act, the Department may extend
the deadline for issuing a preliminary determination in an
administrative review if it determines that it is not practicable to
complete the preliminary review within the statutory time limit of 245
days. On May 13, 1999, the Department published a notice of extension
of the time limit for the preliminary results in this case to September
30, 1999. See CDIW From the People's Republic of China: Antidumping
Duty Administrative Review, Time Limit, 64 FR 27960 (May 24, 1999).
In August 1999, BMMIEC submitted publicly available information and
comments for consideration in valuing the factors of production. On
August 16, 1999, BMMIEC submitted revised sales and factors of
production data.
Scope of Review
The products subject to this antidumping duty order are (1) certain
compact ductile iron waterworks (CDIW) fittings of 3 to 16 inches
nominal diameter regardless of shape, including bends, tees, crosses,
wyes, reducers, adapters, and other shapes, whether or not cement line,
and whether or not covered with bitumen or similar substance,
conforming to American Water Works Association/American National
Standards Institute (AWWA/ANSI) specification C153/A21.53, and rated
for water working pressure of 350 PSI; and (2) certain CDIW standard
ductile iron glands for fittings in sizes 3 to 16 inches, conforming to
AWWA/ANSI specification C111/A21.11 and rated for water working
pressure of 350 PSI. All accessory packs (including accessory packs
containing glands), are excluded from the scope of this order.
The types of CDIW fittings covered by this order are compact
ductile iron mechanical joint waterworks fittings and compact ductile
iron push-on joint waterwork fittings, both of which are used for the
same application. CDIW fittings are used to join water main pressure
pipes, valves, or hydrants in straight lines, and change, divert,
divide, or direct the flow of raw and/or treated water in piping
systems. CDIW fittings attach to the pipe, valve, or hydrant at a joint
and are used principally for municipal water distribution systems. CDIW
glands are used to join mechanical joint CDIW fittings to pipes.
CDIW fittings with nominal diameters greater than 16 inches, are
specifically excluded from the scope of the order. Nonmalleable cast
iron fittings (also called gray iron fittings) and full-bodied ductile
fittings are also specifically excluded from the scope of this order.
Nonmalleable cast iron fittings have little ductility and are generally
rated only 150 to 250 PSI. Full-bodied ductile fittings have a longer
body design than a compact fitting because in the compact design the
straight section of the body is omitted to provide a more compact and
less heavy fitting without reducing strength or flow characteristics.
In addition, the full-bodied ductile fittings are thicker walled than
the compact fittings. Full-bodied fittings are made of either gray iron
or ductile iron, in sizes of 3 to 48 inches, conform to AWWA/ANSI
specification C110/C21.10, and are rated to a maximum of only 250 PSI.
In addition, compact ductile iron flanged fittings are excluded from
the scope of this order, as they have significantly different
characteristics and uses than CDIW fittings.
CDIW fittings are classifiable under subheading 7307.19.30.00 of
the Harmonized Tariff Schedule of the United States (HTSUS). Standard
ductile iron glands are classifiable under HTSUS subheading
7325.99.10.00. Although the HTSUS subheadings are provided for
convenience and customs purposes, our written description of the scope
of this order is dispositive.
Separate Rates
It is the Department's policy to assign all exporters of the
merchandise subject to review in non-market-economy (NME) countries a
single rate, unless an exporter can demonstrate an absence of
government control, both in law and in fact, with respect to exports.
To establish whether an exporter is sufficiently independent of
government control to be entitled to a separate rate, the Department
analyzes the exporter in light of the criteria established in the Final
Determination of Sales at Less Than Fair Value: Sparklers from the
People's Republic of China, 56 FR 20588 (May 6, 1991) (Sparklers), as
amplified in the Final Determination of Sales at Less Than Fair Value:
Silicon Carbide from the People's Republic of China, 59 FR 22585 (May
2, 1994) (Silicon Carbide). Evidence supporting, though not requiring,
a finding of de jure absence of government control over export
activities includes: (1) An absence of restrictive stipulations
associated with an individual exporter's business and export licenses;
(2) any legislative enactments decentralizing control of companies; and
(3) any other formal measures by the government decentralizing control
of companies. Evidence relevant to a de facto absence of government
control with respect to exports is based on four factors, whether the
respondent: (1) Sets its own export prices independent from the
government and other exporters; (2) can retain the proceeds from its
export sales; (3) has the authority to negotiate and sign contracts;
and (4) has autonomy from the government regarding the selection of
management. See Silicon Carbide, 59 FR at 22587; see also Sparklers, 56
FR at 20589.
[[Page 55699]]
BMMIEC responded to the Department's request for information
regarding separate rates, by providing the requested documentation. We
have determined that the evidence on the record demonstrates an absence
of government control, both in law and in fact, with respect to
BMMIEC's exports, in accordance with the criteria identified in
Sparklers and Silicon Carbide. For further information, see Separate
Rates Memo dated September 30, 1999. As a result, BMMIEC is entitled to
a separate rate.
Export Price
We calculated 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 and
constructed export price (CEP) methodology was not otherwise warranted,
based on the facts of record. We calculated EP based on packed, CIF
U.S. port, or FOB PRC port, prices to unaffiliated purchasers in the
United States, as appropriate. We made deductions from the starting
price, where appropriate, for ocean freight services which were
provided by market economy suppliers. We also deducted from the
starting price, where appropriate, an amount for foreign inland
freight, foreign brokerage and handling. As these movement services
were provided by NME suppliers, we valued them using Indian rates. See
``Normal Value'' section below for further discussion.
Normal Value
Section 773(c)(1) of the Act provides that the Department shall
determine the normal value (NV) using a factors-of-production
methodology if: (1) The merchandise is exported from an NME country;
and (2) the information does not permit the calculation of NV using
home-market prices, third-country prices, or constructed value under
section 773(a) of the Act.
The Department has treated the PRC as an NME country in all
previous antidumping cases. In accordance with section 771(18)(C)(i) of
the Act, any determination that a foreign country is an NME country
shall remain in effect until revoked by the administering authority.
None of the parties to this proceeding has contested such treatment in
this review. Therefore, we treated the PRC as an NME country for
purposes of this review. Furthermore, available information does not
permit the calculation of NV using home market prices, third country
prices, or constructed value under section 773(a) of the Act. As a
result, we calculated NV by valuing the factors of production in a
comparable market economy country which is a significant producer of
comparable merchandise.
Section 773(c)(4) of the Act and 19 CFR 351.408 direct us to select
a surrogate country that is economically comparable to the PRC. On the
basis of per capita gross domestic product (GDP), the growth rate in
per capita GDP, and the national distribution of labor, we find that
India is a comparable economy to the PRC. See Memorandum from Director,
Office of Policy, to Office Director, AD/CVD Group II, Office IV, dated
May 21, 1999.
Section 773(c)(4) of the Act also requires that, to the extent
possible, the Department use a surrogate country that is a significant
producer of merchandise comparable to CDIW. For purposes of the LTFV
investigation, we found that India was a significant producer of
comparable merchandise. See Notice of Final Determination of Sales at
Less Than Fair Value: CDIW Fittings and Accessories from the People's
Republic of China, 58 FR 37908 (July 14, 1993) (CDIW Final
Determination). For purposes of this administrative review, we find
that India is a producer of CDIW based on information submitted by the
respondents in their August 1999 submission. Therefore, we have
continued to use India as the surrogate country and have used publicly
available information relating to India, unless otherwise noted, to
value the various factors of production.
For purposes of calculating NV, we valued PRC factors of
production, in accordance with section 773(c)(1) of the Act. Factors of
production include, but are not limited to: hours of labor employed;
quantities of raw materials required; amounts of energy and other
utilities consumed; and representative capital cost, including
depreciation. In examining surrogate values, we selected, where
possible, the publicly available value which was: an average non-export
value; representative of a range of prices within the POR or most
contemporaneous with the POR; product-specific; and tax-exclusive. For
a more detailed explanation of the methodology used in calculating
various surrogate values, see Preliminary Results Factors Valuation
Memorandum from the Team to the File, dated September 30, 1999 (Factors
Memorandum). In accordance with this methodology, we valued the factors
of production as follows:
To value sand, bentonite, and graphite, we relied on import prices
contained in the September and November 1997, as well as the March
1998, issues of Indian Import Statistics. For pig iron, ferrosilicon,
limestone, and perlite, we used the import prices contained in the
September and November 1997, as well as the March 1998 issues of Indian
Import Statistics. For ferrosilico manganese, we relied on import
prices contained in the September 1997 and March 1998 issues of Indian
Import Statistics. For coke (hard), we used the November 1997 issue of
Indian Import Statistics. For firewood and cement, we relied on import
prices contained in the April 1997 through March 1998 issues of Indian
Import Statistics. For those values not contemporaneous with the POR,
we adjusted for inflation using the wholesale price indices (WPI)
published by the International Monetary Fund (IMF). We made further
adjustments to account for freight costs between the suppliers and
BMMIEC's manufacturing facilities.
In accordance with our practice, we added to CIF import values from
India a surrogate freight cost using the shorter of the reported
distances from either the closest PRC port to the factory, or from the
domestic supplier to the factory. See Final Determination of Sales at
Less Than Fair Value: Certain Cut-to-Length Carbon Steel Plate From the
People's Republic of China, 62 FR 61977 (November 20, 1997).
We valued labor based on a regression-based wage rate, in
accordance with 19 CFR 351.408(c)(3).
For electricity, we relied upon public information from the 1995
edition of IEA Energy Prices and Taxes to obtain an average price for
electricity provided to industries in India. We adjusted the values to
reflect inflation up to the POR using the WPI published by the IMF.
For the reported packing materials (i.e., bituminous pitch, steel
angles and straps, and welding rod), we relied upon Indian import data
in the April 1997 through March 1998 issues of Indian Import
Statistics. We adjusted the values to reflect inflation up to the POR
using the WPI published by the IMF. Additionally, we adjusted these
values to account for freight costs incurred between the suppliers and
BMMIEC.
For foreign inland freight, we used the August 1998 truck rate from
Rahul Roadlines. For foreign brokerage and handling, we used the
average of the rates reported in the questionnaire response in the
antidumping duty investigation of Stainless Steel Wire Rod From India.
See Certain Stainless Steel Wire Rod from India; Preliminary Results of
Antidumping Duty Administrative and New Shipper Review. 63 FR 48184
(September 9, 1998); Factors Memorandum. We adjusted the values to
reflect inflation
[[Page 55700]]
up to the POR using the WPI published by the IMF.
For factory overhead (FOH), selling, general, and administrative
expenses (SG&A), and profit, we relied on the 1997 financial statements
of Jayaswal Neco, Ltd, an Indian producer of certain compact ductile
iron waterworks fittings and glands, which were submitted by the
respondents, because this company is a producer of subject merchandise.
Preliminary Results of the Review
We preliminarily determine that the following de minimis margin
exists for the period September 1, 1997 through August 31, 1998:
------------------------------------------------------------------------
Margin
Manufacturer/exporter (percent)
------------------------------------------------------------------------
Beijing Metals and Minerals Import and Export Corporation.. .09
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Interested parties may request a hearing within 30 days of
publication of this notice. See 19 CFR 351.310(c). Any hearing, if
requested, will be held 44 days after the date of the publication of
this notice or the first workday thereafter. Interested parties may
submit case briefs within 30 days of publication. Rebuttal briefs,
limited to issues raised in the case briefs, may be filed no later than
35 days after the date of publication. Parties who submit case briefs
or rebuttal briefs in this proceeding are requested to submit with each
argument (1) a statement of the issue and (2) a brief summary of the
argument. Parties are also encouraged to provide a summary of the
arguments not to exceed five pages and a table of statutes,
regulations, and cases cited.
The Department will subsequently issue the final results of this
administrative review, including the results of its analysis of issues
raised in any such written briefs or at a hearing, not later than 120
days after the date of publication of this notice.
The Department shall determine, and the Customs Service shall
assess, antidumping duties on all appropriate entries. Upon completion
of this review, the Department will issue appraisement instructions
directly to the U.S. Customs Service.
Furthermore, the following deposit requirements will be effective
upon publication of the final results of this antidumping duty
administrative review for all shipments of the subject merchandise
entered, or withdrawn from warehouse, for consumption on or after the
publication date, as provided by section 751(a)(1) of the Act: (1) For
BMMIEC, which has a separate rate, the cash deposit rate will be zero;
(2) for any previously reviewed PRC and non-PRC exporter with a
separate rate (including those companies and products where we
terminated the review), the cash deposit rate will be the company- and
product-specific rate established for the most recent period; (3) the
cash deposit rate for non-PRC exporters of subject merchandise from the
PRC will be the rate applicable to the PRC supplier of that exporter;
and (4) the cash deposit rate for all other PRC exporters will continue
to be 127.38 percent, the PRC-wide rate established in the LTFV
investigation. These requirements, when imposed, shall remain in effect
until publication of the final results of the next administrative
review.
This notice serves as a preliminary reminder to importers of their
responsibility under 19 CFR 351.402(f) 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 is issued and published in accordance
with sections 751(a)(1) and 777(i)(1) of the Act.
Dated: September 30, 1999.
Robert La Russa,
Assistant Secretary for Import Administration.
[FR Doc. 99-26721 Filed 10-13-99; 8:45 am]
BILLING CODE 3510-DS-P
