2011-3746. Light-Walled Rectangular Pipe and Tube From Mexico; Final Results of Antidumping Duty Administrative Review

AGENCY:

Import Administration, International Trade Administration, Department of Commerce.

DATES:

Effective Date: February 18, 2011.

SUMMARY:

On September 13, 2010, the Department of Commerce (the Department) published the preliminary results of the administrative review of the antidumping duty order on light-walled rectangular pipe and tube from Mexico. This first administrative review covers nine manufacturers/exporters and has a period of review (POR) from January 30, 2008, through July 31, 2009. On January 6, 2011, the Department published a notice in which it extended the time limit for completion of the final results of the review until no later than February 10, 2011.

Based on our analysis of the comments received on the preliminary results, we have made changes to the margin calculations for two companies and, as a result, the final results of review differ from the preliminary results for all companies. The final dumping margins for all companies are listed below in the section entitled “Final Results of Review.”

FOR FURTHER INFORMATION CONTACT:

John Drury/Brian Davis (Regiopytsa) or Edythe Artman (Maquilacero), AD/CVD Operations, Office 7, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, NW., Washington, DC 20230; telephone: [phone], or [phone], respectively.

SUPPLEMENTARY INFORMATION:

Background

On September 13, 2010, the Department published the preliminary results of the administrative review of the antidumping duty order on light-walled rectangular pipe and tube from Mexico. See Light-Walled Rectangular Pipe and Tube From Mexico: Preliminary Results of Antidumping Duty Administrative Review, 75 FR 55559 (September 13, 2010) (Preliminary Results). This first administrative review of the order covers sales of subject merchandise, as described in the “Scope of the Order” section below, made during the POR from January 30, 2008, through July 31, 2009. Although we named nine companies in the notice of initiation for this review,^[1] we only examined the individual sales of two companies—Maquilacero S.A. de C.V. (Maquilacero) and Regiomontana de Perfiles y Tubos S.A. de C.V. (Regiopytsa). See “Antidumping Duty Administrative Review of Light-Walled Rectangular Pipe and Tube from Mexico: Respondent Selection Memorandum” from Ericka Ukrow, International Trade Compliance Analyst, AD/CVD Operations, Office 7, to Richard O. Weible, Director, AD/CVD Operations, Office 7, dated October 15, 2009 (Respondent Selection Memorandum).

We invited parties to comment on the Preliminary Results (75 at 55567) and received case and rebuttal briefs from the respondent companies, companies not selected for individual examination, and the domestic interested parties.^[2] None of the parties requested a hearing on the issues raised in comments.

On January 6, 2011, the Department published a notice in which it extended the limit for completion of the final results of review until no later than February 10, 2011. See Light-Walled Rectangular Pipe and Tube From Mexico: Extension of Time Limit for Final Results of Antidumping Duty Administrative Review, 76 FR 774 (January 6, 2011).

Period of Review

The POR is from January 30, 2008, through July 31, 2009.

Scope of the Order

The merchandise that is the subject of this order is certain welded carbon-quality light-walled steel pipe and tube, of rectangular (including square) cross section, having a wall thickness of less than 4 mm. The term carbon-quality steel includes both carbon steel and alloy steel which contains only small amounts of alloying elements. Specifically, the term carbon-quality includes products in which none of the elements listed below exceeds the quantity by weight respectively indicated: 1.80 percent of manganese, or 2.25 percent of silicon, or 1.00 percent of copper, or 0.50 percent of aluminum, or 1.25 percent of chromium, or 0.30 percent of cobalt, or 0.40 percent of lead, or 1.25 percent of nickel, or 0.30 percent of tungsten, or 0.10 percent of molybdenum, or 0.10 percent of niobium, or 0.15 percent vanadium, or 0.15 percent of zirconium. The description of carbon-quality is intended to identify carbon-quality products within the scope. The welded carbon-quality rectangular pipe and tube subject to this order is currently classified under the Harmonized Tariff Schedule of the United States (HTSUS) subheadings 7306.61.50.00 and 7306.61.70.60. While HTSUS subheadings are provided for convenience and Customs purposes, our written description of the scope of this order is dispositive.

Analysis of Comments Received

All issues raised in the case and rebuttal briefs by parties to this antidumping duty administrative review are addressed in the “Issues and Decision Memorandum for the Final Results of the Antidumping Duty Administrative Review of Light-Walled Rectangular Pipe and Tube from Mexico” from Christian Marsh, Deputy Assistant Secretary for Antidumping and Countervailing Duty Operations, to Ronald K. Lorentzen, Deputy Assistant Secretary for Import Administration, dated February 10, 2011 (Decision Memorandum), which is hereby adopted by this notice. A list of all issues, which parties have raised and to which we have responded, is in the Decision Memorandum and attached to this notice as an appendix. The Decision Memorandum, which is a public document, contains a complete discussion of the issues raised in the review and their corresponding recommendations and is on file in the Central Records Unit (CRU) of the main Department of Commerce building, Room 7046. In addition, a complete version of the memorandum can be accessed on the Internet at http://ia.ita.doc.gov/​frn/​index.html. The paper copy and electronic version of the Decision Memorandum are identical in content.

Rates for Non-Selected Companies

For reasons set forth in our Respondent Selection Memorandum, we selected two companies, Maquilacero and Regiopytsa, for individual examination of their sales of the subject merchandise to the United States during the POR as permitted under section 777A(c)(2) of the Tariff Act of 1930, as amended (the Act). For the final results, we have not changed the basis of the rate we applied to companies not selected for individual examination. In the Preliminary Results, we assigned the simple-average margin of the selected companies because Regiopytsa's public quantity-and-value sales information was indexed (as permitted under 19 CFR 351.304(c)), thereby making it impossible for us to calculate a weighted-average margin of the selected companies. See Preliminary Results, 75 FR at 55567. Thus, for the final results, we have continued to take the simple average of the revised margins for Maquilacero and Regiopytsa and applied this rate to the companies not selected for individual examination.

Changes Since the Preliminary Results

Based on our analysis of the comments received, we have made revisions that have changed the results for all companies subject to this review (i.e., including the companies named in the initiation notice but not selected for examination of individual sales). Where the revisions required corrections or modifications to programming language or draft instructions to U.S. Customs and Border Protection (CBP), any such changes have been detailed in company-specific analysis memoranda and cost-adjustment memoranda for Maquilacero and Regiopytsa; all memoranda are dated concurrently with this notice and are on file in the CRU.

For Maquilacero, we have made the following revisions:

(1) We have adjusted the calculation of general and administrative (G&A) expenses by disallowing an offset, which Maquilacero claimed for revenue earned from a special project. We have also removed labor expenses, related to the special project, from the calculation of variable overhead expenses as a result of the offset disallowance. For a discussion of these adjustments, see Comment 3 of the Decision Memorandum.

(2) We have revised the draft liquidation instructions in order to clarify that, for the gap period (i.e., July 28, 2008, through August 4, 2008), the CBP should terminate the suspension of liquidation of any entries and liquidate the entries without regard to antidumping duties. (We have similarly revised the draft liquidations instructions for Regiopytsa and the companies not selected for individual examination.) See Comment 4 of the Decision Memorandum.

(3) We have corrected the margin-calculation program so that domestic inland freight and domestic brokerage and handling expenses are converted from Mexican pesos to U.S.-dollar amounts before being deducted from U.S. price. See Comment 5 of the Decision Memorandum.

For Regiopytsa, we have made the following changes:

(1) We have revised our calculation to follow the Department's practice of basing the universe of sales on the entry date of export-price sales, where this information has been made available to the record. See Comment 2 of the Decision Memorandum.

(2) We have revised our calculation to follow the Department's practice of capping sales-related revenues (in this case interest and insurance revenues) to offset directly associated sales expenses. See Comment 6 of the Decision Memorandum.

(3) We have modified the margin program to ensure that, for products not produced in all six quarters, the total costs of manufacturing reflect quarterly values for scrap cost, scrap revenue, and the reconciliation adjustment, rather than values from the earliest quarter of production. See Comment 7 of the Decision Memorandum.

Final Results of the Review

We determine that the following weighted-average or, if appropriate, simple-average dumping margins exist on light-walled rectangular pipe and tube from Mexico for the period January 30, 2008, through July 31, 2009:

Manufacturer or exporter	Percentage margin
Maquilacero S.A. de C.V.	3.11
Regiomontana de Perfiles y Tubos S.A. de C.V.	9.15
Galvak S.A. de C.V.	6.13
Hylsa S.A. de C.V.	6.13
Industrias Monterrey S.A. de C.V.	6.13
Nacional de Acero S.A. de C.V.	6.13
Perfiles y Herrajes LM S.A. de C.V.	6.13
Productos Laminados de Monterrey S.A. de C.V.	6.13
Ternium Mexico S.A. de C.V.3	6.13

Assessment Rates

The Department shall determine, and CBP shall assess, antidumping duties on all appropriate entries. In accordance with 19 CFR 351.212(b)(1), the Department normally calculates an assessment rate for each importer of the subject merchandise covered by the review. Because both Maquilacero and Regiopytsa reported the entered value for all U.S. sales, we have calculated importer-specific, ad valorem duty assessment rates based on the ratio of each importer's total amount of antidumping duties calculated for the examined sales to the total entered value of the sales for that importer. Where an assessment rate is above de minimis (de minimis being less than 0.5 percent in a review), we will instruct CBP to assess duties on all entries of subject merchandise for that importer during the period from August 5, 2008, through July 31, 2009. For entries made during the provisional-measures period (i.e., January 30, 2008, through July 27, 2008), we will instruct CBP to liquidate the entries at the proper assessment rates for Maquilacero and Regiopytsa, pursuant to section 737(a) of the Act.

For the companies not selected for individual examination, we will instruct CBP to apply the rates listed above and to the entries of subject merchandise produced and/or exported by such companies and entered during the period from August 5, 2008, through July 31, 2009. The rates were obtained by averaging the cash-deposit rates calculated for the companies selected for individual examination. For entries made during the provisional-measures period, we will instruct CBP to apply the lower of the rates calculated or assigned to the companies as a result of our preliminary and final determinations for the less-than-fair-value (LTFV) investigation, if the lower rate is above de minimis. If the lower is below de minimis, we will instruct CBP to liquidate the entries without assessment of antidumping duties. If a firm was not assigned a company-specific rate as a result of our investigation, then we will instruct CBP to apply the rate of 3.76 percent, the all-others rate established by our amended final determination for the investigation, as this rate was lower than the all-others rate calculated for the preliminary determination. See Notice of Amended Final Determination of Sales at Less Than Fair Value: Light-Walled Rectangular Pipe and Tube From Mexico, 73 FR 45400, 45401 (August 5, 2008) (Amended Final Determination).

For any entries of subject merchandise made during the period from July 28, 2008, through August 4, 2008, we will instruct CBP to terminate the suspension of liquidation and to liquidate these entries without regard to antidumping duties.

The Department clarified its “automatic assessment” regulation on May 6, 2003. See Antidumping and Countervailing Duty Proceedings: Assessment of Antidumping Duties, 68 FR 23954 (May 6, 2003) (Assessment Notice). This clarification will apply to entries of subject merchandise during the POR produced by companies included in these final results of review for which these companies did not know that the merchandise it sold to an intermediary was destined for the United States. In such instances, we will instruct CBP to liquidate unreviewed entries at the all-others rate if there is no rate for the intermediate company(ies) involved in the transaction. For a full discussion of this clarification, see Assessment Notice.

Pursuant to 19 CFR 351.106(c)(2), we will instruct CBP to liquidate without regard to antidumping duties any entries for which the assessment rate is de minimis. The Department intends to issue assessment instructions directly to CBP 15 days after the publication of these final results of review.

Cash-Deposit Requirements

The following cash-deposit requirements will be effective upon publication of these final results of review for all shipments of the subject merchandise entered or withdrawn from warehouse for consumption on or after the date of publication, consistent with section 751(a)(1) of the Act: (1) The cash-deposit rates for the reviewed companies will be the rates listed above; (2) if the exporter is not a firm covered in this review but that was covered in the less-than-fair-value (LTFV) investigation, the cash-deposit rate will continue to be the company-specific rate established in the investigation; (3) if the exporter is not a firm covered in this review or the investigation but the manufacturer is, the cash-deposit rate will be the rate established for the manufacturer in the LTFV investigation; and (4) the cash-deposit rate for all other manufacturers or exporters will continue to be 3.76 percent, the all-others rate published in the amended final determination of the LTFV investigation. See Amended Final Determination.

These deposit requirements shall remain in effect until further notice.

Notifications to Interested Parties

This notice serves as a final reminder to importers of their responsibility under 19 CFR 351.402(f)(2) 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 Department's presumption that reimbursement of antidumping duties occurred and the subsequent assessment of doubled antidumping duties.

This notice also serves as a reminder to parties subject to administrative protective orders (APOs) of their responsibility concerning the disposition of proprietary information disclosed under APO in accordance with 19 CFR 351.305(a)(3). Timely written notification of the return or destruction of APO materials or conversion to judicial protective order is hereby requested. Failure to comply with the regulations and the terms of an APO is a sanctionable violation.

This notice is issued and published in accordance with sections 751(a)(1) and 777(i)(1) of the Act.

Dated: February 10, 2011.

Ronald K. Lorentzen,

Deputy Assistant Secretary for Import Administration.

Appendix

1. Offsetting of Negative Margins

2. Inclusion of Sales Entered After Review Period

3. Revenue Offset to General and Administrative Expenses for a Special Project

4. Clarification to Draft Liquidation Instructions for First Review Period

5. Clerical Errors

A. Currency Conversion of Movement Expenses

B. Capping of Sales-Related Revenues

C. Indexing of the Department's Cost Adjustment and Scrap Cost and Revenue on a Quarterly Basis

Footnotes

1.  See Initiation of Antidumping and Countervailing Duty Administrative Reviews and Request for Revocation in Part, 74 FR 48224, 48225 (September 22, 2009).

2.  These parties identified themselves as Atlas Tube, Bull Moose Tube Company, and Searing Industries, Inc., in their August 28, 2009, request for an administrative review.

3.  On August 18, 2009, the Department determined that Ternium Mexico, S.A. de C.V., is the successor-in-interest to Hylsa S.A. de C.V. and should be treated as such for antidumping duty cash-deposit purposes. See Final Results of Antidumping Duty Changed Circumstances Review: Light-Walled Rectangular Pipe and Tube From Mexico, 74 FR 41680 (August 18, 2009).