2015-27364. Welded Stainless Pressure Pipe From India: Initiation of Antidumping Duty Investigation

AGENCY:

Enforcement and Compliance, International Trade Administration, Department of Commerce.

DATES:

Effective: October 27, 2015.

FOR FURTHER INFORMATION CONTACT:

James Terpstra, at [phone], or Alex Rosen, at [phone], AD/CVD Operations, Office III, Enforcement and Compliance, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue NW., Washington, DC 20230.

SUPPLEMENTARY INFORMATION:

The Petition

On September 30, 2015, the Department of Commerce (“the Department”) received an antidumping duty (“AD”) petition concerning imports of welded stainless pressure pipe (“welded stainless pipe”) from India filed in proper form on behalf of Bristol Metals, LLC, Felker Brothers Corporation, Outokumpu Stainless Pipe, Inc., and Marcegaglia USA Inc. (collectively, “Petitioners”).^[1] Petitioners are domestic producers of welded stainless pipe. On October 2, 2015, the Department requested additional information and clarification of certain areas of the Petition.^[2] Petitioners filed responses to these requests on October 6, 2015.^[3]

In accordance with section 732(b) of the Tariff Act of 1930, as amended (the “Act”), Petitioners allege that imports of welded stainless pipe from India are being, or are likely to be, sold in the United States at less than fair value within the meaning of section 731 of the Act and that such imports are materially injuring, or threatening material injury to, an industry in the United States. Also, consistent with section 732(b)(1) of the Act, the Petition is accompanied by information reasonably available to Petitioners supporting their allegations.

The Department finds that Petitioners filed this Petition on behalf of the domestic industry because Petitioners are interested parties as defined in section 771(9)(C) of the Act. The Department also finds that Petitioners have demonstrated sufficient industry support with respect to the initiation of the AD investigation that Petitioners are requesting. See the “Determination of Industry Support for the Petition” section below.

Period of Investigation

Because the Petition was filed on September 30, 2015, pursuant to 19 CFR 351.204(b)(1), the period of investigation (“POI”) is July 1, 2014, through June 30, 2015.

Scope of the Investigation

The product covered by this investigation is welded stainless pipe from India. For a full description of the scope of the investigation, see the “Scope of the Investigation,” in Appendix I of this notice.

Comments on Scope of Investigation

During our review of the Petition, the Department issued questions to, and received responses from, Petitioners pertaining to the proposed scope to ensure that the scope language in the Petition would be an accurate reflection of the products for which the domestic industry is seeking relief.^[4] As discussed in the preamble to the Department's regulations,^[5] we are setting aside a period for interested parties to raise issues regarding product coverage scope. The Department will consider all comments received from parties and, if necessary, will consult with parties prior to the issuance of the preliminary determination. If scope comments include factual information (see 19 CFR 351.102(b)(21)), all such factual information should be limited to public information. In order to facilitate preparation of its questionnaires, the Department requests all interested parties to submit such comments by 5 p.m. Eastern Time on Tuesday, November 10, 2015, which is the first business day after 20 calendar days from the signature date of this notice.^[6] Any rebuttal comments, which may include factual information, must be filed by 5 p.m. Eastern Time on Friday, November 20, 2015, which is 10 calendar days after the initial comments.

The Department requests that any factual information the parties consider relevant to the scope of the investigation be submitted during this time period. However, if a party subsequently finds that additional factual information pertaining to the scope of the investigation may be relevant, the party may contact the Department and request permission to submit the additional information. All such comments must be filed on the records of the concurrent AD and CVD investigations.

Filing Requirements

All submissions to the Department must be filed electronically using Enforcement and Compliance's Antidumping and Countervailing Duty Centralized Electronic Service System (“ACCESS”).^[7] An electronically filed document must be received successfully in its entirety by the time and date when it is due. Documents excepted from the electronic submission requirements must be filed manually (i.e., in paper form) with Enforcement and Compliance's APO/Dockets Unit, Room 18022, U.S. Department of Commerce, 14th Street and Constitution Avenue NW., Washington, DC 20230, and stamped with the date and time of receipt by the applicable deadlines.

Comments on Product Characteristics for Antidumping Questionnaires

The Department requests comments from interested parties regarding the appropriate physical characteristics of welded stainless pipe to be reported in response to the Department's AD questionnaires. This information will be used to identify the key physical characteristics of the subject merchandise in order to report the relevant factors and costs of production accurately as well as to develop appropriate product-comparison criteria.

Interested parties may provide any information or comments that they feel are relevant to the development of an accurate list of physical characteristics. Specifically, they may provide comments as to which characteristics are appropriate to use as: (1) General product characteristics and (2) product-comparison criteria. We note that it is not always appropriate to use all product characteristics as product-comparison criteria. We base product-comparison criteria on meaningful commercial differences among products. In other words, while there may be some physical product characteristics utilized by manufacturers to describe welded stainless pipe, it may be that only a select few product characteristics take into account commercially meaningful physical characteristics. In addition, interested parties may comment on the order in which the physical characteristics should be used in matching products. Generally, the Department attempts to list the most important physical characteristics first and the least important characteristics last.

In order to consider the suggestions of interested parties in developing and issuing the AD questionnaires, all comments on product characteristics must be filed by 5 p.m. Eastern Time on November 10, 2015. Rebuttal comments must be received by 5 p.m. Eastern Time on November 20, 2015. All comments and submissions to the Department must be filed electronically using ACCESS, as referenced above.

Determination of Industry Support for the Petition

Section 732(b)(1) of the Act requires that a petition be filed on behalf of the domestic industry. Section 732(c)(4)(A) of the Act provides that a petition meets this requirement if the domestic producers or workers who support the petition account for: (i) At least 25 percent of the total production of the domestic like product; and (ii) more than 50 percent of the production of the domestic like product produced by that portion of the industry expressing support for, or opposition to, the petition. Moreover, section 732(c)(4)(D) of the Act provides that, if the petition does not establish support of domestic producers or workers accounting for more than 50 percent of the total production of the domestic like product, the Department shall: (i) Poll the industry or rely on other information in order to determine if there is support for the petition, as required by subparagraph (A); or (ii) determine industry support using a statistically valid sampling method to poll the “industry.”

Section 771(4)(A) of the Act defines the “industry” as the producers as a whole of a domestic like product. Thus, to determine whether a petition has the requisite industry support, the statute directs the Department to look to producers and workers who produce the domestic like product. The International Trade Commission (“ITC”), which is responsible for determining whether “the domestic industry” has been injured, must also determine what constitutes a domestic like product in order to define the industry. While both the Department and the ITC must apply the same statutory definition regarding the domestic like product,^[8] they do so for different purposes and pursuant to a separate and distinct authority. In addition, the Department's determination is subject to limitations of time and information. Although this may result in different definitions of the like product, such differences do not render the decision of either agency contrary to law.^[9]

Section 771(10) of the Act defines the domestic like product as “a product which is like, or in the absence of like, most similar in characteristics and uses with, the article subject to an investigation under this title.” Thus, the reference point from which the domestic like product analysis begins is “the article subject to an investigation” (i.e., the class or kind of merchandise to be investigated, which normally will be the scope as defined in the Petition).

With regard to the domestic like product, Petitioners do not offer a definition of the domestic like product distinct from the scope of the investigation. Based on our analysis of the information submitted on the record, we have determined that welded stainless pipe constitutes a single domestic like product and we have analyzed industry support in terms of that domestic like product.^[10]

In determining whether Petitioners have standing under section 732(c)(4)(A) of the Act, we considered the industry support data contained in the Petition with reference to the domestic like product as defined in the “Scope of the Investigation,” in Appendix I of this notice. To establish industry support, Petitioners provided their shipments of the domestic like product in 2014, and compared their shipments to the estimated total shipments of the domestic like product for the entire domestic industry.^[11] Because total industry production data for the domestic like product for 2014 is not reasonably available and Petitioners have established that shipments are a reasonable proxy for production data,^[12] we have relied upon the shipment data provided by Petitioners for purposes of measuring industry support.^[13]

Our review of the data provided in the Petition, General Issues Supplement, and other information readily available to the Department indicates that Petitioners have established industry support.^[14] First, the Petition established support from domestic producers (or workers) accounting for more than 50 percent of the total shipments ^[15] of the domestic like product and, as such, the Department is not required to take further action in order to evaluate industry support (e.g., polling).^[16] Second, the domestic producers (or workers) have met the statutory criteria for industry support under section 732(c)(4)(A)(i) of the Act because the domestic producers (or workers) who support the Petition account for at least 25 percent of the total shipments of the domestic like product.^[17] Finally, the domestic producers (or workers) have met the statutory criteria for industry support under section 732(c)(4)(A)(ii) of the Act because the domestic producers (or workers) who support the Petition account for more than 50 percent of the shipments of the domestic like product produced by that portion of the industry expressing support for, or opposition to, the Petition.^[18] Accordingly, the Department determines that the Petition was filed on behalf of the domestic industry within the meaning of section 732(b)(1) of the Act.

The Department finds that Petitioners filed the Petition on behalf of the domestic industry because they are interested parties as defined in section 771(9)(C) of the Act and they have demonstrated sufficient industry support with respect to the AD investigation that they are requesting the Department initiate.^[19]

Allegations and Evidence of Material Injury and Causation

Petitioners allege that the U.S. industry producing the domestic like product is being materially injured, or is threatened with material injury, by reason of the imports of the subject merchandise sold at less than normal value (“NV”). In addition, Petitioners allege that subject imports exceed the negligibility threshold provided for under section 771(24)(A) of the Act.^[20]

Petitioners contend that the industry's injured condition is illustrated by reduced market share; decline in shipments, production, and capacity utilization; underselling and price suppression or depression; inventory overhang; decreased employment, hours worked, and wages; lost sales and revenues; and negative impact on profitability.^[21] We have assessed the allegations and supporting evidence regarding material injury, threat of material injury, and causation, and we have determined that these allegations are properly supported by adequate evidence and meet the statutory requirements for initiation.^[22]

Allegations of Sales at Less Than Fair Value

The following is a description of the allegations of sales at less-than-fair-value upon which the Department based its decision to initiate an investigation of imports of welded stainless pipe from India. The sources of data for the deductions and adjustments relating to U.S. price and NV are discussed in greater detail in the India AD Initiation Checklist.

Export Price

Petitioners based U.S. price on Indian welded stainless pipe offered for sale in the United States.^[23] Where applicable, Petitioners made deductions for the relevant movement charges based on publicly available information from several sources, consistent with delivery terms.^[24] After analyzing the reported movement charge information, the Department made two minor revisions to Petitioners' submitted calculation of U.S. price.^[25]

Normal Value

Petitioners based normal value on a price quote obtained by a market researcher for welded stainless pipe produced and sold in India having the same specifications as the welded stainless pipe in the U.S. price quote.^[26] Because the price quote was received from a distributor, Petitioners deducted a potential mark-up from this price, based on their knowledge of the industry. Petitioners made no additional deductions because, given the terms of sale, no further deductions would be appropriate.^[27]

Fair Value Comparisons

Based on the data provided by Petitioners, there is reason to believe that imports of welded stainless pipe from India are being, or are likely to be, sold in the United States at less than fair value. Based on comparisons of EP to NV in accordance with section 773(a)(1) of the Act, the estimated dumping margins as calculated from data provided by the Petitioners and recalculated by the Department for welded stainless pipe from India is 32.06 percent.^[28]

Initiation of Less-than-Fair-Value Investigation

Based upon the examination of the Petition on welded stainless pipe India, we find that the Petition meets the requirements of section 732 of the Act. Therefore, we are initiating an AD investigation to determine whether imports of welded stainless pipe from India is being, or are likely to be, sold in the United States at less than fair value. In accordance with section 733(b)(1)(A) of the Act and 19 CFR 351.205(b)(1), unless postponed, we will make our preliminary determinations no later than 140 days after the date of this initiation.

On June 29, 2015, the President of the United States signed into law the Trade Preferences Extension Act of 2015, which made numerous amendments to the AD and CVD law.^[29] The 2015 law does not specify dates of application for those amendments.^[30] On August 6, 2015, the Department published an interpretative rule, in which it announced the applicability dates for each amendment to the Act, except for amendments contained in section 771(7) of the Act, which relate to determinations of material injury by the ITC.^[31] The amendments to sections 771(15), 773, 776, and 782 of the Act are applicable to all determinations made on or after August 6, 2015, and, therefore, apply to this AD investigation.^[32]

Respondent Selection

Petitioners name 13 companies as producers/exporters of welded stainless pipe from India.^[33] Following standard practice in AD investigations involving market economy countries, the Department intends to select respondents based on U.S. Customs and Border Protection (“CBP”) data for U.S. imports under the appropriate Harmonized Tariff Schedule of the United States (“HTSUS”) numbers listed in the “Scope of the Investigation” section above. We intend to release the CBP data under Administrative Protective Order (“APO”) to all parties with access to information protected by APO within five business days of publication of this Federal Register notice.

Interested parties wishing to comment regarding respondent selection must do so within seven business days of the publication of this notice. Comments must be filed electronically using ACCESS. An electronically-filed document must be received successfully in its entirety by the Department's electronic records system, ACCESS, by 5 p.m. Eastern Time by the date noted above. We intend to make our decision regarding respondent selection within 20 days of publication of this notice.

Distribution of Copies of the Petition

In accordance with section 732(b)(3)(A) of the Act and 19 CFR 351.202(f), copies of the public version of the Petition have been provided to the Government of India via ACCESS. To the extent practicable, we will attempt to provide a copy of the public version of the Petition to each exporter named in the Petition, as provided under 19 CFR 351.203(c)(2).

ITC Notification

We have notified the ITC of our initiation, as required by section 732(d) of the Act.

Preliminary Determination by the ITC

The ITC will preliminarily determine, within 45 days after the date on which the Petition was filed, whether there is a reasonable indication that imports of welded stainless pipe from India is materially injuring or threatening material injury to a U.S. industry.^[34] A negative ITC determination will result in the investigation being terminated; otherwise, the investigation will proceed according to statutory and regulatory time limits.

Submission of Factual Information

Factual information is defined in 19 CFR 351.102(b)(21) as: (i) Evidence submitted in response to questionnaires; (ii) evidence submitted in support of allegations; (iii) publicly available information to value factors under 19 CFR 351.408(c) or to measure the adequacy of remuneration under 19 CFR 351.511(a)(2); (iv) evidence placed on the record by the Department; and (v) evidence other than factual information described in (i)-(iv). Any party, when submitting factual information, must specify under which subsection of 19 CFR 351.102(b)(21) the information is being submitted ^[35] and, if the information is submitted to rebut, clarify, or correct factual information already on the record, to provide an explanation identifying the information already on the record that the factual information seeks to rebut, clarify, or correct.^[36] Time limits for the submission of factual information are addressed in 19 CFR 351.301, which provides specific time limits based on the type of factual information being submitted. Please review the regulations prior to submitting factual information in this investigation.

Extensions of Time Limits

Parties may request an extension of time limits before the expiration of a time limit established under 19 CFR 351, or as otherwise specified by the Secretary. In general, an extension request will be considered untimely if it is filed after the expiration of the time limit established under 19 CFR 351 expires. For submissions that are due from multiple parties simultaneously, an extension request will be considered untimely if it is filed after 10 a.m. Eastern Time on the due date. Under certain circumstances, we may elect to specify a different time limit by which extension requests will be considered untimely for submissions which are due from multiple parties simultaneously. In such a case, we will inform parties in the letter or memorandum setting forth the deadline (including a specified time) by which extension requests must be filed to be considered timely. An extension request must be made in a separate, stand-alone submission; under limited circumstances we will grant untimely-filed requests for the extension of time limits. Review Extension of Time Limits; Final Rule, 78 FR 57790 (September 20, 2013), available at http://www.gpo.gov/​fdsys/​pkg/​FR-2013-09-20/​html/​2013-22853.htm,, prior to submitting factual information in this investigation.

Certification Requirements

Any party submitting factual information in an AD or CVD proceeding must certify to the accuracy and completeness of that information.^[37] Parties are hereby reminded that revised certification requirements are in effect for company/government officials, as well as their representatives. Investigations initiated on the basis of petitions filed on or after August 16, 2013, and other segments of any AD or CVD proceedings initiated on or after August 16, 2013, should use the formats for the revised certifications provided at the end of the Final Rule.^[38] The Department intends to reject factual submissions if the submitting party does not comply with applicable revised certification requirements.

Notification to Interested Parties

Interested parties must submit applications for disclosure under APO in accordance with 19 CFR 351.305. On January 22, 2008, the Department published Antidumping and Countervailing Duty Proceedings: Documents Submission Procedures; APO Procedures, 73 FR 3634 (Jan. 22, 2008). Parties wishing to participate in the investigation should ensure that they meet the requirements of these procedures (e.g., the filing of letters of appearance as discussed at 19 CFR 351.103(d)).

This notice is issued and published pursuant to section 777(i) of the Act.

Dated: October 20, 2015.

Paul Piquado,

Assistant Secretary for Enforcement and Compliance.

Appendix I

Scope of the Investigation

The merchandise covered by this investigation is circular welded austenitic stainless pressure pipe not greater than 14 inches in outside diameter. References to size are in nominal inches and include all products within tolerances allowed by pipe specifications. This merchandise includes, but is not limited to, the American Society for Testing and Materials (“ASTM”) A-312 or ASTM A-778 specifications, or comparable domestic or foreign specifications. ASTM A-358 products are only included when they are produced to meet ASTM A-312 or ASTM A-778 specifications, or comparable domestic or foreign specifications.

Excluded from the scope of the investigation are: (1) Welded stainless mechanical tubing, meeting ASTM A-554 or comparable domestic or foreign specifications; (2) boiler, heat exchanger, superheater, refining furnace, feedwater heater, and condenser tubing, meeting ASTM A-249, ASTM A-688 or comparable domestic or foreign specifications; and (3) specialized tubing, meeting ASTM A-269, ASTM A-270 or comparable domestic or foreign specifications.

The subject imports are normally classified in subheadings 7306.40.5005, 7306.40.5040, 7306.40.5062, 7306.40.5064, and 7306.40.5085 of the Harmonized Tariff Schedule of the United States (“HTSUS”). They may also enter under HTSUS subheadings 7306.40.1010, 7306.40.1015, 7306.40.5042, 7306.40.5044, 7306.40.5080, and 7306.40.5090. The HTSUS subheadings are provided for convenience and customs purposes only; the written description of the scope of this investigation is dispositive.

Footnotes

1.  See “Petition for the Imposition of Antidumping and Countervailing Duties on Imports of Welded Stainless Pressure Pipe from India Pursuant to Sections 701 and 703 of the Tariff Act of 1930, as Amended,” at Volume II, dated September 30, 2015 (“Petition”).

2.  See the Department's letter to Petitioners, “Petition for the Imposition of Antidumping Duties on Imports of Welded Stainless Pressure Pipe from India: Supplemental Questions,” dated October 2, 2015 (“AD Deficiency Questionnaire”) and the Department's letter to Petitioners, “Petitions for the Imposition of Antidumping and Countervailing Duties on Imports of Welded Stainless Pressure Pipe from India: Supplemental Questions,” dated October 2, 2015 (“General Issues Questionnaire”).

3.  See Petitioners' letter to the Department, “Welded Stainless Pressure Pipe from India: Response to Supplemental Questions {Volume II},” dated October 6, 2015 (“AD Petition Supplement”) and Petitioners' letter to the Department, “Welded Stainless Pressure Pipe from India: Response to Supplemental Questions {Volume I},” dated October 6, 2015 (“General Issues Supplement”).

4.  See General Issues Questionnaire and General Issues Supplement. See also Petitioners' submission, “Welded Stainless Pressure Pipe from India: Revised Scope Definition,” dated October 15, 2015.

5.  See Antidumping Duties; Countervailing Duties; Final Rule, 62 FR 27296, 27323 May 19, 1997.

6.  See 19 CFR 351.303(b)

7.  See Antidumping and Countervailing Duty Proceedings: Electronic Filing Procedures; Administrative Protective Order Procedures, 76 FR 39263 (July 6, 2011) for details of the Department's electronic filing requirements, which went into effect on August 5, 2011; see also Enforcement and Compliance; Change of Electronic Filing System Name, 79 FR 69046 (November 20, 2014). Information on help using ACCESS can be found at https://access.trade.gov/​help.aspx and a handbook can be found at https://access.trade.gov/​help/​Handbook%20on%20Electronic%20Filling%20Procedures.pdf.

8.  See section 771(10) of the Act.

9.  See USEC, Inc. v. United States, 132 F. Supp. 2d 1, 8 (CIT 2001) (citing Algoma Steel Corp., Ltd. v. United States, 688 F. Supp. 639, 644 (CIT 1988), aff'd 865 F.2d 240 (Fed. Cir. 1989)).

10.  For a discussion of the domestic like product analysis in this case, see Antidumping Duty Investigation Initiation Checklist: Welded Stainless Pressure Pipe from India (“India AD Initiation Checklist”), at Attachment II, Analysis of Industry Support for the Antidumping and Countervailing Duty Petitions Covering Welded Stainless Pressure Pipe from India (“Attachment II”). This checklist is dated concurrently with this notice and on file electronically via ACCESS. Access to documents filed via ACCESS is also available in the Central Records Unit, Room B8024 of the main Department of Commerce building.

11.  See Volume I of the Petition, at 2-3 and Exhibits I-1 and I-2; see also General Issues Supplement, at 3-8 and Exhibits I-9 and I-10.

12.  See Volume I of the Petition, at 3 and Exhibit I-1; see also General Issues Supplement, at 3-6 and Exhibits I-8 and I-9.

13.  For further discussion, see India AD Initiation Checklist, at Attachment II.

14.  Id.

15.  As mentioned above, Petitioners have established that shipments are a reasonable proxy for production data. Section 351.203(e)(1) of the Department's regulations states “production levels may be established by reference to alternative data that the Secretary determines to be indicative of production levels.”

16.  See section 732(c)(4)(D) of the Act; see also India AD Initiation Checklist, at Attachment II.

17.  See India AD Initiation Checklist, at Attachment II.

18.  Id.

19.  Id.

20.  See General Issues Supplement, at 9 and Exhibit I-11.

21.  See Volume I of the Petition, at 11-25, and Exhibits I-1, I-5, and I-7; see also General Issues Supplement, at 9 and Exhibit I-11.

22.  See India AD Initiation Checklist, at Attachment III, Analysis of Allegations and Evidence of Material Injury and Causation for the Antidumping and Countervailing Duty Petitions Covering Welded Stainless Pressure Pipe from India.

23.  See Volume II of the Petition, at Exhibit II-1 and AD Petition Supplement at Exhibit II-11.

24.  See Volume II of the Petition, at Exhibits II-3,4,5,6,7 and AD Petition Supplement at Exhibit II-12 and 13.

25.  We disallowed Petitioners' deduction for foreign inland freight expenses based on insufficient support and made a correction to the calculation of U.S. inland freight fees that was inadvertently omitted from Petitioners' AD Petition Suplement. See discussion of minor revisions in the narrative of the India AD Initation Checklist and the calculation at Attachment V.

26.  See Volume II of the Petition at Exhibit II-8. See also, the Department's memorandum “Telephone Call to Foreign Market Researcher Regarding Antidumping Petition,” dated October 7, 2015.

27.  See AD Petition Supplement, at Exhibit II-14.

28.  See India AD Initiation Checklist, at Attachment V.

29.  See Trade Preferences Extension Act of 2015, Pub. L. 114-27, 129 Stat. 362 (2015).

30.  In accordance with section 505(a) of the Trade Preferences Extension Act of 2015, amending section 773(b)(2) of the Act, for the investigation, the Department will request information necessary to calculate the CV and COP to determine whether there are reasonable grounds to believe or suspect that sales of the foreign like product have been made at prices that represent less than the COP of the product. The Department will no longer require a COP allegation to conduct this analysis

31.  See Dates of Application of Amendments to the Antidumping and Countervailing Duty Laws Made by the Trade Preferences Extension Act of 2015, 80 FR 46793 (August 6, 2015) (Applicability Notice).

32.  Id. at 46794-95. The 2015 amendments may be found at https://www.congress.gov/​bill/​114th-congress/​house-bill/​1295/​text/​pl.

33.  See Volume I of the Petition, at Exhibit I-4.

34.  See section 733(a) of the Act.

35.  See 19 CFR 351.301(b).

36.  See 19 CFR 351.301(b)(2).

37.  See section 782(b) of the Act.

38.  See Certification of Factual Information to Import Administration during Antidumping and Countervailing Duty Proceedings, 78 FR 42678 (July 17, 2013) (Final Rule); see also frequently asked questions regarding the Final Rule, available at http://enforcement.trade.gov/​tlei/​notices/​factual_​info_​final_​rule_​FAQ_​07172013.pdf.