[Federal Register Volume 61, Number 194 (Friday, October 4, 1996)]
[Notices]
[Pages 51904-51907]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-25537]
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DEPARTMENT OF COMMERCE
[A-351-817]
Certain Cut-to-Length Carbon Steel Plate From Brazil: Preliminary
Results of Antidumping Duty Administrative Review
AGENCY: Import Administration, International Trade Administration,
Department of Commerce.
ACTION: Notice of Preliminary Results of Antidumping Duty
Administrative Review.
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SUMMARY: In response to a request from the respondent, Companhia
Siderurgica de Tubarao (CST), the Department of Commerce (the
Department) is conducting an administrative review of the antidumping
duty order on certain cut-to-length carbon steel plate from Brazil.
This review covers the above manufacturer/exporter of the subject
merchandise to the United States. The period of review (POR) is August
1, 1994, through July 31, 1995.
We preliminarily determine the dumping margin for CST to be 2.58
percent during the POR. Interested parties are invited to comment on
these preliminary results. Parties who submit argument in this
proceeding should also submit with the argument (1) a statement of the
issue, and (2) a brief summary of the argument.
EFFECTIVE DATE: October 4, 1996.
FOR FURTHER INFORMATION CONTACT: Helen Kramer or Linda Ludwig,
Enforcement Group III, Import Administration, International Trade
[[Page 51905]]
Administration, U.S. Department of Commerce, 14th Street and
Constitution Avenue NW., Washington, DC 20230; telephone: (202) 482-
0405 or (202) 482-3833, respectively.
SUPPLEMENTARY INFORMATION:
The 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 (URAA). In addition, unless otherwise
indicated, all citations to the Department's regulations are to the
current regulations, as amended by the interim regulations published in
the Federal Register on May 11, 1995 (60 Fed. Reg. 25130).
Background
On July 9, 1993, the Department published in the Federal Register
(58 Fed. Reg. 37136) the final affirmative antidumping duty
determination on certain cut-to-length carbon steel plate from Brazil.
We published an antidumping duty order on August 19, 1993 (58 Fed. Reg.
44164). On August 1, 1995, the Department published the Opportunity to
Request an Administrative Review of this order for the period August 1,
1994-July 31, 1995 (60 Fed. Reg. 39150). The Department received a
request for an administrative review of CST's exports from CST, a
producer/exporter of the subject merchandise. We initiated the review
on September 8, 1995 (60 Fed. Reg. 46817). In a separate proceeding,
the product produced by the respondent is the subject of an ongoing
scope inquiry.
Under the Act, the Department may extend the deadline for
completion of administrative reviews if it determines that it is not
practicable to complete the review within the statutory time limit of
365 days. On April 1, 1996, the Department extended the time limits for
the preliminary and final results in this case. See Extension of Time
Limit for Antidumping Duty Administrative Reviews, 61 Fed. Reg. 14291
(1996).
The Department is conducting this review in accordance with section
751 of the Act.
Scope of the Review
The products covered by this administrative review constitute one
``class or kind'' of merchandise: certain cut-to-length carbon steel
plate. These products include hot-rolled carbon steel universal mill
plates (i.e., flat-rolled products rolled on four faces or in a closed
box pass, of a width exceeding 150 millimeters but not exceeding 1,250
millimeters and of a thickness of not less than 4 millimeters, not in
coils and without patterns in relief), of rectangular shape, neither
clad, plated nor coated with metal, whether or not painted, varnished,
or coated with plastics or other nonmetallic substances; and certain
hot-rolled carbon steel flat-rolled products in straight lengths, of
rectangular shape, hot rolled, neither clad, plated, nor coated with
metal, whether or not painted, varnished, or coated with plastics or
other nonmetallic substances, 4.75 millimeters or more in thickness and
of a width which exceeds 150 millimeters and measures at least twice
the thickness, as currently classifiable in the Harmonized Tariff
Schedule (HTS) under item numbers 7208.31.0000, 7208.32.0000,
7208.33.1000, 7208.33.5000, 7208.41.0000, 7208.42.0000, 7208.43.0000,
7208.90.0000, 7210.70.3000, 7210.90.9000, 7211.11.0000, 7211.12.0000,
7211.21.0000, 7211.22.0045, 7211.90.0000, 7212.40.1000, 7212.40.5000,
and 7212.50.0000. Included are flat-rolled products of nonrectangular
cross-section where such cross-section is achieved subsequent to the
rolling process (i.e., products which have been ``worked after
rolling'')--for example, products which have been beveled or rounded at
the edges. Excluded is grade X-70 plate. These HTS item numbers are
provided for convenience and Customs purposes. The written description
remains dispositive.
Verification
As provided in section 782(i) of the Tariff Act, we verified
information provided by the respondent by using standard verification
procedures, including on-site inspection of the manufacturer's
facilities, the examination of relevant sales and financial records,
and selection of original documentation containing relevant
information. Our verification results are outlined in the verification
report, the public version of which is available in Import
Administration's Central Records Unit.
Transactions Reviewed
In accordance with Section 751 of the Act, the Department is
required to determine the normal value and export price (EP) of each
entry of subject merchandise during the relevant review period.
Product Comparisons
In accordance with section 771(16) of the Act, we considered
profile slabs sold in the home market during the POR and produced by
the respondent to be covered by the description in the Scope of the
Review section above, and to be foreign like products for purposes of
determining appropriate product comparisons to U.S. sales. We matched
sales of foreign like products to U.S. sales based on the physical
characteristics reported by the respondent and verified by the
Department. To take into account the high rate of inflation in Brazil
during the POR, we compared foreign like products and products exported
to the United States which were sold in the same month. Where there
were no sales of identical merchandise in the home market to compare to
U.S. sales within the same month, we compared U.S. sales to the next
most similar foreign like product (on the basis of the characteristics
listed in Appendix III of the Department's September 14, 1995,
antidumping questionnaire) which was sold in the same month.
Fair Value Comparisons
To determine whether sales of certain cut-to-length carbon steel
plate by CST to the United States were made at less than fair value, we
compared the export price (EP) to the normal value (NV), as described
in the ``Export Price'' and ``Normal Value'' sections of this notice.
In accordance with section 777A(d)(2), we calculated monthly weighted-
average prices for NV and compared these to individual U.S.
transactions.
Export Price (EP)
We used EP as defined in section 772(a) of the Act. We calculated
EP based on FOB prices to unaffiliated customers in the United States.
We made deductions from the starting price for foreign inland freight
and foreign brokerage and handling. Based on our verification of CST's
U.S. sales response, we made minor adjustments to CST's reported
foreign brokerage and handling. The material costs of stowing and
lashing the merchandise on vessels are the only packing costs on U.S.
sales, and are included in foreign brokerage and handling.
Normal Value
Based on a comparison of the aggregate quantity of home market and
U.S. sales, we determined that the quantity of the foreign like product
sold in the exporting country was sufficient to permit a proper
comparison with the sales of the subject merchandise to the United
States, pursuant to section 773(a) of the Act.
On January 17, 1996, petitioners alleged that CST made home market
sales of the subject merchandise at
[[Page 51906]]
prices below the cost of production (COP) during the POR. The
Department has determined that when appropriate adjustments to
petitioners' methodology are made, there is no evidence of below cost
sales. (See internal memorandum to Joseph A. Spetrini from Roland L.
MacDonald and Christian B. Marsh, ``Petitioners' Allegation of Sales
Below the Cost of Production for Companhia Siderurgica de Tubarao
(CST).'') Therefore, in accordance with section 773(a)(1)(B)(i) of the
Act, we based NV on the price at which the foreign like product was
first sold for consumption in the home market, in the usual commercial
quantities and in the ordinary course of trade.
During verification, we found that an order acknowledgement and
production specification sheet are issued each time agreement is
reached with a customer on price, quantity and product. We therefore
conclude that the appropriate date of sale in the home market, when all
the essential terms of sale are set, is the order acknowledgement date,
the same as the reported date of sale in the U.S. market. Consequently,
we have preliminarily rejected CST's reported home market date of sale,
which is the invoice date.
We have preliminarily disallowed an adjustment for credit expenses,
because the respondent did not provide the interest rates requested by
the Department for use in calculating these expenses. CST did not
report any packing expenses. To achieve tax neutrality, we deducted
value-added taxes (CONFINS, PIS and IPI) included in home market
prices, but not assessed on the subject merchandise, from the reported
gross unit price. As 95 percent of the IPI tax paid is rebated, we
deducted only five percent of the reported IPI tax paid from the home
market price. To equalize the rates of ICMS tax included in home market
and U.S. prices, we subtracted the amount of the ICMS tax included in
the home market price and added back 2.21 percent of the reported net
home market price (which is the rate of ICMS tax included in the price
of subject merchandise). We made adjustments to NV for differences in
cost attributable to differences in physical characteristics of the
merchandise, pursuant to section 773(a)(6)(C)(ii) of the Act.
As set forth in section 773(a)(1)(B)(i) of the Act and in the
Statement of Administrative Action (SAA) at pages 829-831, to the
extent practicable, the Department will calculate normal values based
on sales at the same level of trade as the U.S. sales. When the
Department is unable to find sales in the comparison market at the same
level of trade as the U.S. sale(s), the Department may compare sales in
the U.S. and foreign markets at different levels of trade. See, Final
Determination of Sales at Less Than Fair Value: Certain Pasta from
Italy, 61 FR. 30326, June 14, 1996.
In accordance with section 773(a)(7)(A), if sales at different
levels of trade are compared, the Department will adjust the normal
value to account for the difference in level of trade if two conditions
are met. First, there must be differences between the actual selling
functions performed by the seller at the level of trade of the U.S.
sale and the level of trade of the normal value sale. Second, the
differences between the levels of trade must affect price
comparability, as evidenced by a pattern of consistent price
differences between sales at the different levels of trade in the
market in which normal value is determined.
In its questionnaire responses, CST stated that there were no
differences in its selling activities by customer categories within
each market. In order independently to confirm the absence of separate
levels of trade within or between the U.S. and home markets, we
examined CST's questionnaire responses for indications that CST's
function as a seller differed among customer categories. Pursuant to
section 773(a)(1)(B)(i) of the Act, and the SAA at 827, in identifying
levels of trade for directly observed (i.e., not constructed) export
price and normal values sales, we considered the selling functions
reflected in the starting price, before any adjustments. Where
possible, we further examined whether each selling function was
performed on a substantial portion of sales. (See Proposed Rulemaking,
61 Fed. Reg. at 7348).
CST sold to trading companies in the U.S. market. In the home
market, CST sold to distributors and performed the same selling
functions with respect to sales to all its home market customers, as
well as with respect to U.S. customers. Thus, our analysis of the
questionnaire response leads us to conclude that sales within each
market and between markets are not made at different levels of trade.
At verification, we interviewed CST's sales manager, who confirmed our
conclusion. Accordingly, we preliminarily find that all sales in the
home market and the U.S. market are made at the same level of trade.
Therefore, all price comparisons are at the same level of trade and an
adjustment pursuant to section 773(a)(7)(A) is unwarranted.
Review Limited to CST
On April 3, 1996, petitioners alleged that CST failed to disclose
significant interlocking directorships and other business relationships
between CST and two other companies included in the original
investigation, Companhia Siderurgica Paulista (COSIPA) and Usinas
Siderurgica de Minas Gerais S.A. (USIMINAS). COSIPA and USIMINAS are
not respondents in this proceeding. The Department has determined that
although CST, COSIPA and USIMINAS are affiliated parties, as defined in
section 351.102 (b) of the Proposed Regulations, they should not be
treated as a single enterprise for margin calculation purposes. (See
the Department's internal memorandum from Richard O. Weible to Joseph
A. Spetrini dated September 10, 1996.) Thus, we have based EP and NV
solely on CST's own sales.
Currency Conversion
For purposes of the preliminary results, we made currency
conversions based on the official exchange rates in effect on the dates
of the U.S. sales as certified by the Federal Reserve Bank of New York.
Section 773A(a) directs the Department to use a daily exchange rate in
order to convert foreign currencies into U.S. dollars, unless the daily
rate involves a ``fluctuation.'' In accordance with the Department's
practice, we have determined as a general matter that a fluctuation
exists when the daily exchange rate differs from a benchmark by 2.25
percent. The benchmark is defined as the rolling average of rates for
the past 40 business days. When we determine a fluctuation exists, we
substituted the benchmark for the daily rate. However, for the
preliminary results in this review we have not determined that a
fluctuation exists, and we have not substituted the benchmark for the
daily rate.
Preliminary Results of the Review
As a result of this review, we preliminarily determine that the
following weighted-average dumping margin exists:
[[Page 51907]]
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Margin
Manufacturer/exporter Period (percent)
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Companhia Siderurgica de Tubarao........... 8/1/94-7/31/95 2.58
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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 date of publication or the
first business day thereafter. Case briefs and/or other written
comments from interested parties may be submitted not later than 30
days after the date of publication. Rebuttal briefs and rebuttals to
written comments, limited to issues raised in those comments, may be
filed not later than 37 days after the date of publication of this
notice. The Department will publish the final results of this
administrative review, including its analysis of issues raised in any
written comments or at a hearing, not later than 180 days after the
date of publication of this notice.
The following deposit requirements will be effective upon
publication of the final results of this antidumping duty review for
all shipments of certain cut-to-length carbon steel plate from Brazil
entered, or withdrawn from warehouse for consumption, on or after the
publication date, as provided by section 751(a) of the Tariff Act: (1)
The cash deposit rate for the reviewed company will be the rate
established in the final results of this administrative review; (2) for
exporters not covered in this review, but covered in the LTFV
investigation, the cash deposit rate will continue to be the company-
specific rate from the LTFV investigation; (3) if the exporter is not a
firm covered in this 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; (4)
the cash deposit rate for all other manufacturers or exporters will
continue to be 75.54 percent, the ``All Others'' rate made effective by
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 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 published in accordance
with section 751(a)(1) of the Act and 19 CFR 353.22.
Dated: September 25, 1996.
Robert S. LaRussa,
Acting Assistant Secretary for Import Administration.
[FR Doc. 96-25537 Filed 10-3-96; 8:45 am]
BILLING CODE 3510-DS-P
