[Federal Register Volume 61, Number 194 (Friday, October 4, 1996)]
[Notices]
[Pages 51888-51891]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-25538]
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DEPARTMENT OF COMMERCE
[A-421-804]
Certain Cold-Rolled Carbon Steel Flat Products From the
Netherlands; 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 requests from the respondent, Hoogovens Staal
BV (Hoogovens), and from the petitioners in the original investigation,
the
[[Page 51889]]
Department of Commerce (the Department) is conducting an administrative
review of the antidumping duty order on certain cold-rolled carbon
steel flat products from the Netherlands. This review covers one
manufacturer/exporter, Hoogovens, and the period August 1, 1994 through
July 31, 1995.
We preliminarily determine the dumping margin for Hoogovens to be
9.26 percent during the period August 1, 1994, through July 31, 1995.
Interested parties are invited to comment on these preliminary results.
Parties who submit argument in this proceeding are requested to 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 M. Kramer or Linda D. Ludwig,
Enforcement Group III, Import Administration, International Trade
Administration, U.S. Department of Commerce, 14th Street and
Constitution Avenue, N.W., Room 7866, Washington, D.C. 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 Rounds 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 FR 25130).
Background
The Department published an antidumping duty order on certain cold-
rolled carbon steel flat products from the Netherlands on August 19,
1993 (58 FR 44172). The Department published a notice of ``Opportunity
to Request an Administrative Review'' of the antidumping duty order for
the 1994/95 review period on August 1, 1995 (60 FR 39150). On August
29, 1995, Hoogovens requested that the Department conduct an
administrative review of the antidumping duty order on cold-rolled
carbon steel flat products from the Netherlands. The petitioners made a
similar request on August 31, 1995. We initiated the review on
September 8, 1995 (60 FR 46817).
On February 15, 1996, the petitioners requested that the Department
determine, in accordance with section 751(a)(4) of the Act, whether
antidumping duties have been absorbed by Hoogovens during the period of
review (``POR''). Section 351.213(j) of the Department's draft
regulations provides that, for transition orders as defined in section
751(c)(6)(C) of the Act, i.e., orders in effect as of January 1, 1995,
reviews initiated in 1996 will be considered initiated in the second
year, and reviews initiated in 1998 will be considered initiated in the
fourth year. 61 FR 7317, 7366 (February 27, 1996). Although these
regulations are not yet binding upon the Department, they do constitute
a public statement of how the Department expects to proceed in
construing section 751(a)(4) of the new statute. This approach assures
that, prior to the time for sunset review under section 751(c),
interested parties will still have the opportunity to request a duty
absorption study on orders for which the second and fourth
anniversaries have already passed.
Because the order being reviewed here has been in effect since
1993, this is a review of a transition order. Therefore, based on the
policy stated above, the Department will first consider a request for
an absorption study if a review is initiated in 1996.
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
preliminary and final results in this case. See Extension of Time Limit
for Antidumping Duty Administrative Reviews, 61 FR 14291.
The Department is now conducting this administrative review in
accordance with section 751 of the Act.
Scope of the Review
The products covered by this review include cold-rolled (cold-
reduced) carbon steel flat-rolled products, of rectangular shape,
neither clad, plated nor coated with metal, whether or not painted,
varnished or coated with plastics or other nonmetallic substances, in
coils (whether or not in successively superimposed layers) and of a
width of 0.5 inch or greater, or in straight lengths which, if of a
thickness less than 4.75 millimeters, are of a width of 0.5 inch or
greater and which measures at least 10 times the thickness or if of a
thickness of 4.75 millimeters or more are 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
7209.11.0000, 7209.12.0030, 7209.12.0090, 7209.13.0030, 7209.13.0090,
7209.14.0030, 7209.14.0090, 7209.21.0000, 7209.22.0000, 7209.23.0000,
7209.24.1000, 7209.24.5000, 7209.31.0000, 7209.32.0000, 7209.33.0000,
7209.34.0000, 7209.41.0000, 7209.42.0000, 7209.43.0000, 7209.44.0000,
7209.90.0000, 7210.70.3000, 7210.90.9000, 7211.30.1030, 7211.30.1090,
7211.30.3000, 7211.30.5000, 7211.41.1000, 7211.41.3030, 7211.41.3090,
7211.41.5000, 7211.41.7030, 7211.41.7060, 7211.41.7090, 7211.49.1030,
7211.49.1090, 7211.49.3000, 7211.49.5030, 7211.49.5060, 7211.49.5090,
7211.90.0000, 7212.40.1000, 7212.40.5000, 7212.50.0000, 7217.11.1000,
7217.11.2000, 7217.11.3000, 7217.19.1000, 7217.19.5000, 7217.21.1000,
7217.29.1000, 7217.29.5000, 7217.31.1000, 7217.39.1000, and
7217.39.5000.
Included in this review 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 bevelled or rounded
at the edges. Excluded from this review is certain shadow mask steel,
i.e., aluminum-killed, cold-rolled steel coil that is open-coil
annealed, has a carbon content of less than 0.002 percent, is of 0.003
to 0.012 inch in thickness, 15 to 30 inches in width, and has an ultra
flat, isotropic surface. These HTS item numbers are provided for
convenience and Customs purposes. The written description remains
dispositive.
Verification
As provided in section 782(i)(3) of the Act, we verified
information provided by Hoogovens and its U.S. affiliate, Rafferty-
Brown Steel Co., Inc. of Connecticut, 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 public
versions of the verification reports.
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, and the
normal value and constructed export price (CEP) of each sale to the
first unaffiliated customer in
[[Page 51890]]
the United States during the extended window period.
Based on a comparison of the aggregate quantity of home market and
U.S. sales, we determined that the quantity of 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. Therefore, in accordance
with section 773(a)(1)(B)(i) of the Act, we based normal value (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. We determined that Hoogovens need not
report its home market sales made by an affiliated party to the first
unaffiliated customer (downstream sales), because these sales were
small. (See Memorandum for the File, November 8, 1995.) We used sales
to affiliated customers only where we determined such sales were made
at arm's-length prices, i.e., at prices comparable to prices at which
the respondent sold identical merchandise to unrelated customers. There
were no allegations of below-cost sales in the home market.
Product Comparisons
In accordance with section 771(16) of the Act, we considered all
products produced by the respondent covered by the description in the
Scope of the Review section, above, and sold in the home market during
the POR, to be foreign like products for purposes of determining
appropriate product comparisons to U.S. sales. Where there were no
sales of identical merchandise in the home market to compare to U.S.
sales, 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. In
making the product comparisons, we matched foreign like products based
on the physical characteristics reported by the respondent and verified
by the Department.
Fair Value Comparisons
To determine whether sales of certain cold-rolled carbon steel flat
products by Hoogovens to the United States were made at less than fair
value, we compared EP or CEP to NV, as described in the United States
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. In accordance
with section 773(a)(4) of the Act, we used constructed value (CV) as
the basis for NV when there were no contemporaneous sales of the
foreign like product in the comparison market. All the sales to which
CV was applied were CEP sales of secondary merchandise. We calculated
CV in accordance with section 773(e) of the Act and the methodology
enunciated in the Memorandum of April 19, 1995, entitled Treatment of
Non-Prime Merchandise for the First Administrative Review of Certain
Carbon Steel Flat Products. We included the cost of manufacture, and
selling, general and administrative expenses (SG&A). In accordance with
section 773(e)(2)(A) of the Act, we based SG&A expenses on the amounts
incurred by the respondent in connection with the production and sale
of the foreign like product in the ordinary course of trade for
consumption in the comparison market. For selling expenses, we used the
weighted average home market selling expenses. There were no
adjustments to CV for differences in circumstances of sale.
United States Price (USP)
For the price to the United States, we used export price (EP) or
constructed export price (CEP) as defined in sections 772(a) and 772(b)
of the Act, as appropriate. All of the CEP sales were further
manufactured in the United States.
We calculated EP and CEP based on the packed, delivered, duty-paid
price to unaffiliated customers in the United States. We made
deductions for movement expenses (foreign inland freight, foreign
brokerage and handling, international freight, marine insurance, U.S.
inland freight, U.S. brokerage and handling, and U.S. Customs duties)
in accordance with section 772(c)(2)(A) of the Act. For EP sales, we
made deductions from the gross unit price for discounts where
applicable. We accounted for post-sale price adjustments for individual
sales (reported in the ``Other Discounts'' field) by reducing or
increasing the gross unit price, as appropriate. In accordance with
section 772(d)(1) of the Act and the Statement of Administrative Action
(SAA) (at 823-824), we calculated the CEP by deducting discounts,
selling expenses associated with economic activities occurring in the
United States, including commissions, credit expenses, and indirect
selling expenses, inventory carrying costs and repacking expenses. In
accordance with section 772(d)(2) of the Act, we also deducted the cost
of further manufacturing. Finally, we made an adjustment for an amount
of profit allocated to these expenses in accordance with section
772(d)(3) of the Act. No other adjustments to EP or CEP were claimed or
allowed.
Normal Value
Home market prices were based on the packed, ex-factory or
delivered prices to affiliated or unaffiliated customers and were
reported net of value added tax. We deducted packing and movement
expenses in accordance with sections 773(a)(6) (A) and (B) of the Act.
We made adjustments, where appropriate, for discounts, rebates and
post-sale price adjustments. In comparisons to EP and CEP sales, we
also 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 and increased NV by U.S. packing
costs in accordance with section 773(a)(6)(A) of the Act.
As set forth in section 773(a)(1)(B)(i) of the Act and in the SAA
at 829-831, to the extent practicable, the Department will calculate
NVs 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. sales, the Department may compare sales
in the U.S. and foreign markets at different levels of trade. See,
also, Final Determination of Sales at Less Than Fair Value: Certain
Pasta from Italy (61 FR 30326, June 14, 1996) (Pasta from Italy).
In accordance with section 773(a)(7)(A), if sales at different
levels of trade are compared, the Department will adjust the NV 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 NV sale. Second, the difference 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
NV is determined.
In its response to Section A of the questionnaire, Hoogovens stated
that it made sales in the U.S. and home markets at two distinct levels
of trade: (1) sales to end-user customers, and (2) sales to steel
service centers. In its Section B response, Hoogovens explained that it
cannot differentiate among the selling functions performed and services
offered to the different classes of home market or export price
customers during the POR. Consequently, Hoogovens could not
[[Page 51891]]
meet the Department's test and did not claim a level of trade
adjustment with respect to its EP sales in this review. Hoogovens
reported these sales using the code ``1'' in the CUSTLOTH and CUSTLOTU
fields. However, Hoogovens argued that all of its home market sales
used as the basis of NV involved the performance of various selling
activities, many of which are not accounted for by the direct selling
expense adjustment to NV. Therefore, Hoogovens claimed, there is no
home market equivalent to the CEP and Hoogovens requested that the
Department make an adjustment to NV for indirect selling expenses up to
the amount of indirect selling expenses deducted from CEP. Hoogovens
reported CEP sales using the code ``2'' in the CUSTLOTU field.
During verification, the team interviewed Hoogoven's Senior Sales
Executive for Stripmill Products regarding services provided to
different categories of customers. He explained that the company
provides the same types of services to all customers in all markets.
See the public version of the verification report, p. 10. In
identifying the level of trade for CEP sales, we considered only the
selling activities reflected in the U.S. price after deduction of
expenses and profit under section 772(d) of the Act. Pursuant to
section 773(a)(1)(B)(i) of the Act, we considered the selling functions
reflected in the starting price of the home market sales before any
adjustments. Based on our analysis, we preliminarily find that no level
of trade differences exist between any sales in either the home market
or the U.S. market. Therefore, all price comparisons are at the same
level of trade, and neither an adjustment pursuant to section
773(a)(7)(A), nor a circumstances of sale adjustment in accordance with
section 773(a)(6)(C)(iii) of the Act and 19 C.F.R. 353.56, is
warranted.
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) of the Act 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 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 existed, we
substitute the benchmark for the daily rate. However, for the
preliminary results we have not determined that a fluctuation exists,
and we have not substituted the benchmark for the daily rate.
Reimbursement
Section 353.26 of the antidumping regulations requires the
Department to deduct from the United States price the amount of any
antidumping duty that a producer or reseller either pays directly on
behalf of the importer or reimburses to the importer. Based on verified
evidence on the record in this review, the Department has preliminarily
determined that Hoogovens has agreed to reimburse Hoogovens Steel USA,
Inc. (formerly N.V.W. (USA), Inc.), the importer of record, for
antidumping duties to be assessed, and has reimbursed Hoogovens Steel
for antidumping duty cash deposits made on entries during the POR.
Therefore, the regulation applies.
Preliminary Results of the Review
As a result of this review, we preliminarily determine that the
following weighted-average dumping margin exists:
------------------------------------------------------------------------
Margin
Manufacturer/exporter Period (percent)
------------------------------------------------------------------------
Hoogovens Staal BV........................ 8/1/94-7/31/95 9.26
------------------------------------------------------------------------
Parties to this proceeding may request disclosure within five days
of publication of this notice and 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 working day
thereafter. Interested parties may submit case briefs and/or written
comments no later than 30 days after the date of publication. Rebuttal
briefs and rebuttals to written comments, limited to issues raised in
such briefs or comments, may be filed no later than 37 days after the
date of publication. The Department will publish a notice of the final
results of the administrative review, which will include the results of
its analysis of issues raised in any such written comments or at the
hearing, within 180 days from the issuance of these preliminary
results.
The Department shall determine, and Customs shall assess,
antidumping duties on all appropriate entries. Individual differences
between USP and NV, taking into account reimbursed duties, may vary
from the percentage stated above. The Department will issue
appraisement instructions directly to Customs. The final results of
this review shall be the basis for the assessment of antidumping duties
on entries of merchandise covered by this review and for future
deposits of estimated duties.
The following deposit requirements will be effective upon
completion of the final results of this administrative review for all
shipments of certain cold-rolled carbon steel flat products from the
Netherlands entered, or withdrawn from warehouse, for consumption on or
after the publication date of the final results of this administrative
review, as provided by section 751(a)(1) of the Act and 19 CFR 353.26:
(1) the cash deposit rate for Hoogovens will be the rate established in
the final results of this administrative review; (2) if the exporter is
a firm not covered in this review, but the manufacturer is Hoogovens,
the cash deposit rate will be that established for Hoogovens in the
final results of this review; and (3) if neither the exporter nor the
manufacturer is a firm covered in this review, the cash deposit rate
will be 19.32 percent, the ``all others'' rate established after remand
in the LTFV investigation.
These deposit requirements, when imposed, shall remain in effect
until publication of the final results of the next administrative
review.
This administrative review and notice are in accordance with
section 751(a)(1) of the Act and 19 CFR 353.22.
Dated: September 27, 1996.
Barbara R. Stafford
Acting Assistant Secretary for Import Administration.
[FR Doc. 96-25538 Filed 10-3-96; 8:45 am]
BILLING CODE 3510-DS-P
