00-32979. Notice of Final Determination of Sales at Less Than Fair Value: Stainless Steel Butt-Weld Pipe Fittings From Malaysia

AGENCY:

Import Administration, International Trade Administration, Department of Commerce.

ACTION:

Notice of the final determination in the less than fair value investigation of stainless steel butt-weld pipe fittings from Malaysia.

SUMMARY:

On August 2, 2000, the Department of Commerce (“Department”) published the preliminary determination in the less than fair value (“LTFV”) investigation of stainless steel butt-weld pipe fittings from Malaysia. See Notice of Preliminary Determination of Sales at Not Less Than Fair Value and Postponement of Final Determination: Stainless Steel Butt-Weld Pipe Fittings from Malaysia, 65 FR 47398 (August 2, 2000) (“Preliminary Determination”). This investigation covers one manufacturer/exporter of the subject merchandise. The period of investigation (“POI”) is October 1, 1998 through September 30, 1999.

Based upon our verification of the data and analysis of the comments received, we have made changes to our determination. Therefore, the final determination differs from the preliminary determination of this investigation. The final weighted-average dumping margin is listed below in the section titled “Final Determination of the Investigation.”

EFFECTIVE DATE:

December 27, 2000.

FOR FURTHER INFORMATION CONTACT:

Juanita H. Chen or Rick Johnson, Enforcement Group III, Office 9, Import Administration, International Trade Administration, U.S. Department of Commerce, 1401 Constitution Avenue, NW., Washington, DC 20230, telephone [phone] (Chen) or 202-482-3818 (Johnson), fax [phone].

SUPPLEMENTARY INFORMATION:

Applicable Statute

Unless otherwise indicated, all citations to the Tariff Act of 1930 (“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 (“URAA”). In addition, unless otherwise indicated, all citations to the Department's regulations are to the regulations at 19 CFR Part 351 (1999).

Period of Investigation

The period of investigation (“POI”) is October 1, 1998 through September 30, 1999.

Background

On January 18, 2000, the Department initiated an antidumping duty investigation on stainless steel butt-weld pipe fittings from Malaysia. See Initiation of Antidumping Duty Investigations: Stainless Steel Butt-Weld Pipe Fittings From Germany, Italy, Malaysia and the Philippines, 65 FR 4595 (January 31, 2000). On August 2, 2000, the Department published a notice of its preliminary determination in the investigation. See Preliminary Determination, 65 FR 47398. On September 25, 2000 through September 29, 2000, the Department conducted the sales verification for Kanzen Tetsu Sdn. Bhd. (“Kanzen”). See Sales Verification Report (October 11, 2000). On October 2, 2000 through October 6, 2000, the Department conducted the cost verification for Kanzen. See Verification Report on the Cost of Production and Constructed Value Data (October 31, 2000). We invited parties to comment on our Preliminary Determination. Petitioners submitted their case brief (“Petitioners” Brief”) on November 13, 2000. Kanzen did not submit a case brief. Kanzen submitted its rebuttal brief (“Kanzen Rebuttal”) on November 20, 2000. Pursuant to a September 1, 2000 request by petitioners, the Department held a public hearing on the issues on November 22, 2000. The Department has conducted and completed the investigation in accordance with section 735 of the Act.

Scope of the Investigation

For purposes of this investigation, the product covered is certain stainless steel butt-weld pipe fittings (“pipe fittings”). Certain pipe fittings are under 14 inches in outside diameter (based on nominal pipe size), whether finished or unfinished. The product encompasses all grades of stainless steel and “commodity” and “specialty” fittings. Specifically excluded from the definition are threaded, grooved, and bolted fittings, and fittings made from any material other than stainless steel.

The pipe fittings subject to this investigation are generally designated under specification ASTM A403/A403M, the standard specification for Wrought Austenitic Stainless Steel Piping Fittings, or its foreign equivalents (e.g., DIN or JIS specifications). This specification covers two general classes of fittings, WP and CR, of wrought austenitic stainless steel fittings of seamless and welded construction covered by the latest revision of ANSI B16.9, ANSI B16.11, and ANSI B16.28. Pipe fittings manufactured to specification ASTM A774, or its foreign equivalents, are also covered by this investigation.

This investigation does not apply to cast fittings. Cast austenitic stainless steel pipe fittings are covered by specifications A351/A351M, A743/743M, and A744/A744M.

The pipe fittings subject to this investigation are currently classifiable under subheading 7307.23.0000 of the Harmonized Tariff Schedule of the United States (“HTSUS”). Although the HTSUS subheadings are provided for convenience and Customs purposes, the written description of the scope of this investigation is dispositive.

Analysis of Comments Received

All issues raised in the case and rebuttal briefs to this investigation are addressed in the December 15, 2000 Issues and Decision Memorandum (“Decision Memo”) from Joseph A. Spetrini, Deputy Assistant Secretary, Import Administration, to Troy H. Cribb, Assistant Secretary for Import Administration, which is hereby adopted by this notice. A list of the issues which parties have raised and to which we have responded, and other issues addressed, all of which are in the Decision Memo, is attached to this notice as an Appendix. Parties can find a complete discussion of all issues raised in this investigation and the corresponding recommendations in the Decision Memo, a public memorandum which is on file at the U.S. Department of Commerce, in the Central Records Unit, in room B-099. In addition, a complete version of the Decision Memo can be accessed directly on the Web at http://ia.ita.doc.gov. The paper copy and electronic version of the Decision Memorandum are identical in content.

Use of Facts Available

In accordance with section 776 of the Act, we have determined that the use of facts available is appropriate for certain portions of our analysis of Kanzen. For a discussion of our determination with respect to this matter, see the Decision Memo.

Fair Value Comparisons

To determine whether sales of pipe fittings from Malaysia to the United States were made at LTFV, we compared the export price (“EP”) to the normal value (“NV”), as described in the “Export Price” and “Normal Value” sections of our Preliminary Determination, except as noted below, and as set forth in the Decision Memo, and the Analysis Memorandum for Kanzen Tetsu Sdn. Bhd.: Final Determination in the Less Than Fair Value Investigation of Stainless Steel Butt-Weld Pipe Fittings from Malaysia (December 15, 2000) (“Final Analysis Memo”).

Export Price

We are calculating and applying an average unit bank charge per ton on U.S. sales, applying facts available from Kanzen's U.S. sales to calculate marine insurance expense on certain sales, correcting the marine insurance denomination in our margin analysis program, applying facts available on Kanzen's returns during the POI, allocating a percentage of miscellaneous unreported bank charges to Kanzen's U.S. sales, applying partial adverse facts available to Kanzen's unreported U.S. sale, and including the quantity for the unshipped sale reported by Kanzen, applying facts available for certain variables. See Decision Memo and Final Analysis Memo.

Normal Value

We are applying invoice date as the date of sale for U.K. sales, rather than contract date as in the Preliminary Determination. We are disallowing direct selling expenses on Kanzen's U.K. sales, adjusting domestic inland freight on certain invoices, correcting the reported payment date for certain sales observations, and allocating a percentage of miscellaneous unreported bank charges to Kanzen's U.K. sales. See Decision Memo and Final Analysis Memo.

Cost of Production

We have revised the calculations for the variance ratios, scrap, adjustment for differences in merchandise, and the general and administrative expense factors. See Decision Memo and Final Analysis Memo.

Sales Below Cost in the Comparison Market

The Department disregarded comparison market below-cost sales that failed the cost test in the final results of the investigation.

Changes Since the Preliminary Determination

Based on our verification and analysis of the comments received, including ministerial error comments, we have made certain changes in the model match and margin calculation programs, as discussed in the Decision Memo, the Final Analysis Memo, and the Ministerial Error Memorandum for the Preliminary Determination of Sales at Not Less Than Fair Value (August 17, 2000) (“Ministerial Error Memo”).

Suspension of Liquidation

In accordance with section 735(c)(1)(B) of the Act, we are directing the U.S. Customs Service (“Customs”) to suspend liquidation of all entries of subject merchandise from Malaysia that are entered, or withdrawn from warehouse, for consumption on or after the date of publication of this Final Determination in the Federal Register, as provided by section 735(c)(1)(C) of the Act. We will instruct Customs to require a cash deposit or the posting of a bond equal to the weighted-average amount by which the normal value exceeds the U.S. price, as indicated in the chart below. These suspension of liquidation instructions will remain in effect until further notice.

Stainless Steel Butt-Weld Pipe Fittings

Producer/manufacturer/exporter	Weighted-average margin (percent)
Kanzen	7.51
All others	7.51

ITC Notification

In accordance with section 735(d) of the Act, we have notified the International Trade Commission (“ITC”) of our final determination. As our final determination is affirmative, the ITC will, within 75 days, determine whether these imports are materially injuring, or threaten material injury to, the U.S. industry. If the ITC determines that material injury or threat of material injury does not exist, the proceeding will be terminated and all securities posted will be refunded or canceled. If the ITC determines that such injury does exist, the Department will issue an antidumping duty order directing Customs to assess antidumping duties on all imports of the subject merchandise entered or withdrawn from warehouse for consumption on or after the effective date of the suspension of liquidation.

This determination is issued and published pursuant to sections 735(d) and 777(i)(1) of the Act.

Dated: December 15, 2000.

Troy H. Cribb,

Assistant Secretary for Import Administration.

Appendix—Issues in the Decision Memo

General Issues:

• Ministerial Errors From the Preliminary Determination

General Sales Issues:

• Date of Sale/Market Viability
• Bank Charges

U.K. Sales Issues:

• Domestic Inland Freight
• Credit Period
• FOB v. CIF
• Early Payment Discount

U.S. Sales Issues:

• Marine Insurance Expense
• Marine Insurance Expense Discount and Denomination
• Returns
• Miscellaneous Bank Charges
• Unreported U.S. Sales
• Unshipped Sale
• Inland Freight

Cost Issues:

• Total Adverse Facts Available
• Allocation of Cost Variances
• Standard Cost Reduction Factor for Pipes Used for Fittings
• Cost of Fittings Made of Finished Pipes
• G&A Expense Ratio