[Federal Register Volume 59, Number 41 (Wednesday, March 2, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-4736]
[[Page Unknown]]
[Federal Register: March 2, 1994]
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DEPARTMENT OF COMMERCE
[A-588-810]
Mechanical Transfer Presses From Japan; Final Results of
Antidumping Duty Administrative Review
AGENCY: International Trade Administration/Import Administration
Department of Commerce.
ACTION: Notice of final results of antidumping duty administrative
review.
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SUMMARY: On November 18, 1993, the Department of Commerce published the
preliminary results of the administrative review of the antidumping
duty order on mechanical transfer presses from Japan. The review covers
four manufacturers/exporters of subject merchandise to the United
States and the period February 1, 1992, through January 31, 1993. We
gave interested parties an opportunity to comment on the preliminary
results. We received comments from the petitioner and two respondents.
Based on our analysis, we have changed the final results from those
presented in the preliminary results of review.
EFFECTIVE DATE: March 2, 1994.
FOR FURTHER INFORMATION CONTACT: Rebecca Trainor or Maureen Flannery,
Office of Antidumping Compliance, Import Administration, International
Trade Administration, U.S. Department of Commerce, 14th Street and
Constitution Avenue NW., Washington, DC 20230; telephone: (202) 482-
4733.
SUPPLEMENTARY INFORMATION:
Background
On November 18, 1993, the Department of Commerce (the Department)
published in the Federal Register (58 FR 60843) the preliminary results
of the third administrative review of the antidumping duty order on
mechanical transfer presses (MTPs) from Japan (55 FR 5642, February 16,
1990). The Department has now completed the review in accordance with
section 751 of the Tariff Act of 1930, as amended (the Tariff Act).
Scope of the Review
Imports covered by the review include MTPs currently classifiable
under Harmonized Tariff Schedule (HTS) item numbers 8462.99.0035 and
8466.94.5040. The HTS numbers are provided for convenience and for U.S.
Customs purposes. The written description remains dispositive.
The term ``mechanical transfer presses'' refers to automatic metal-
forming machine tools with multiple die stations in which the workpiece
is moved from station to station by a transfer mechanism designed as an
integral part of the press and synchronized with the press action,
whether imported as machines or parts suitable for use solely or
principally with these machines. These presses may be imported
assembled or unassembled.
This review covers four manufacturer/exporters of MTPs from Japan
entered into the United States during the period February 1, 1992,
through January 31, 1993. This review does not cover spare and
replacement parts and accessories, which were determined to be outside
the scope of the order. See ``Final Scope Ruling on Spare and
Replacement Parts,'' U.S. Department of Commerce, March 20, 1992. On
November 23, 1993, the Department determined that Aida's FMX series
cold forging press is within the scope of the order. See ``Final Scope
Ruling--Antidumping Duty Order on Mechanical Transfer Presses from
Japan: Aida Engineering, Ltd.,'' U.S. Department of Commerce, November
23, 1993. We have included the FMX press in our analysis for these
final results.
Analysis of Comments Received
We gave interested parties an opportunity to comment on the
preliminary results of review, as provided by 19 CFR 353.38. We
received comments from the petitioner, Verson Division of Allied
Products Corp., and two respondents, Aida Engineering, Ltd. (Aida), and
Komatsu Ltd. (Komatsu).
Comment 1: The petitioner argues that the Department should have
used an exchange rate based on either the date of shipment or the date
of entry, instead of employing the exchange rate in effect on the date
of sale to the United States, because of the extended time between the
sale and shipment of MTPs, and the appreciation of the yen against the
dollar during the review period.
Aida and Komatsu state that the Department correctly employed the
exchange rate in effect on the date of the U.S. sale, according to the
Department's regulations, 19 CFR 353.60, 353.46, 353.49 and 353.50.
Department's Position: We agree with respondents that we have
properly employed the exchange rate that was in effect on the date the
merchandise was sold to the United States. According to our regulations
and long-standing practice, when the U.S. price is based on purchase
price and the foreign market value (FMV) is based on constructed value
(CV), the conversion of currency is directly tied to the date the
merchandise is sold for exportation to the United States. See 19 CFR
353.60 and 19 CFR 353.50(b)(1).
Comment 2: Aida states that it is reserving the right to challenge
the Department's inclusion of the FMX press within the scope of the
order and within the final results of this review.
The petitioner claims that the Department should include home
market and U.S. sales of Aida's FMX press and its optional transfer
unit in its analysis for these final results, because the Department
has determined that the FMX press is within the scope of the order.
Department's Position: We agree with petitioner. We did not include
the FMX press in our preliminary results of review, but stated we would
do so in our final results if an affirmative scope determination were
made by that time. On November 23, 1993, the Department determined that
Aida's FMX cold forging press is within the scope of the antidumping
duty order on MTPs. See ``Final Scope Ruling--Antidumping Duty Order on
Mechanical Transfer Presses from Japan: Aida Engineering, Ltd.,'' U.S.
Department of Commerce, November 23, 1993. We verified the sales and CV
data Aida submitted with respect to the FMX press sold in the United
States during the review period, and have included this sale in our
final analysis.
Comment 3: Aida states that, subsequent to verification, it
analyzed the year-end warranty cost adjustments discovered at
verification, and concluded that only a portion thereof should be
allocated to warranty cost. In its case brief, Aida presents a
recalculation of the warranty expense factor, and asks that the
Department use this revised factor to calculate warranty costs for the
final results.
Department's Position: At verification, the Department discovered
that Aida's records indicated an amount for additional warranty costs
that Aida had not reported. At that time, Aida claimed that these costs
were related to non-subject merchandise, but was unable to
satisfactorily document this position. See sales verification report
dated October 19, 1993, page 13.
According to 19 CFR 353.31(a)(1)(ii), the time limit for submitting
factual information in an administrative review is not later than the
earlier of the date of publication of the notice of preliminary results
of review or 180 days after the date of publication of the notice of
initiation of the review. As Aida submitted its explanation of the
additional unreported warranty expenses and recalculation of the
warranty expense factor after the date of publication of the
preliminary results, this information was untimely submitted.
Therefore, we did not consider this information for these final
results. As in the preliminary results of review, we used warranty
costs as adjusted for the additional costs discovered at verification.
Comment 4: Aida states that the Department erred in adding related-
party commissions on U.S. sales to FMV, and offsetting the commissions
by deducting home market indirect selling expenses up to the amount of
the commissions. Aida believes that the Department should have treated
the commissions as internal transfers, which do not require any
adjustment to FMV or offsetting adjustment for indirect home market
selling expenses.
Department's Position: Aida reported commissions to a related party
that varied directly with the sale price of an MTP. We verified the
commissions paid, and have no reason to believe that these directly
related selling expenses were not, in fact, in the nature of
commissions. The fact that these commissions were paid to a related
party does not change their nature as commissions. Therefore, in
accordance with 19 CFR 353.56(a), we are adjusting FMV for the
differences in home market and U.S. commissions. Because there were
commissions on both U.S. and home market sales, 19 CFR 353.56(b), which
calls for an offset when there are commissions in one market but not
the other, does not apply.
Comment 5: The petitioner asserts that the Department did not
evaluate or adjust Aida's transfer prices from a certain related party
supplier for such things as direct materials, labor, and/or overhead,
as applicable, to reach a fully-loaded cost of production. The
petitioner further states that the only adjustment made to the related
party inputs was an adjustment made by the Department to include the
general and administrative expense of the related supplier.
Aida contends that it made an adjustment for the difference between
the transfer price of components purchased from its related party
supplier and the related party supplier's cost of manufacturing the
components. Aida acknowledges that it inadvertently failed to take into
account its related party's processing cost variance and general and
administrative expense, but notes that the Department made an
adjustment for these, based on verification findings, in its
preliminary results.
Department's Position: We agree with Aida. The Department was able
to verify Aida's adjustment to restate related party inputs to fully-
loaded costs. Aida's adjustment included direct materials, labor, and
overhead. Based on the Department's findings at verification, an
adjustment was made to not only general and administrative expenses,
but also to the related party's processing variance. (See cost
verification report dated October 22, 1993, page 9.)
Comment 6: Petitioner contends that the Department failed to
verify, but should establish, whether transfer prices of inputs
acquired by Aida from other related parties were at or above cost.
Aida states that the only material purchased for the subject
presses from a related company, other than those from the related party
discussed in Comment 5, above, consisted of control panels purchased
from a partially-owned subsidiary. Aida further states that the
reasonableness of the transfer prices used to determine the cost of
these components was reviewed and confirmed at verification. With
respect to subcontracted work, Aida states that, with the exception of
the related party the Department verified, all subcontractors are
unrelated.
Department's Position: We agree with Aida. At verification, the
Department analyzed all transactions with related parties. Based on our
analysis, we found these transactions to have been made at or above
cost. (See cost verification report dated October 22, 1993, page 9.)
Comment 7: Komatsu argues that the adjustment that the Department
made, in its preliminary results, to costs of subcontracted work
performed by a particular related-party supplier, was based on a
misunderstanding regarding the method used to calculate costs for that
work. In fact, Komatsu claims, in calculating the actual cost of the
related-party inputs, it inadvertently overstated the costs by a
specific profit percentage. Komatsu contends that, given the above, the
costs of the related-party inputs should be reduced rather than
increased.
Department's Position: We disagree with Komatsu. Komatsu did not
clearly demonstrate at verification its alleged overstatement of the
actual costs of the related-party inputs by a profit margin. Given that
the information reviewed at verification indicates an understatement,
rather than an overstatement, of costs, an upward adjustment to the
value of these related-party inputs for a portion of the period loss
incurred by the related party is warranted. (See cost verification
report dated October 25, 1993, pages 7 and 8.)
Comment 8: The petitioner asserts that the Department should
increase Komatsu's submitted costs to account for losses incurred by
certain other related suppliers during the review period. The
petitioner notes that the Department failed to verify the costs of
inputs from these suppliers.
Komatsu argues that the amount of Komatsu's purchases from those
suppliers was clearly insignificant, as would have been any adjustment
the Department might have made.
Department's Position: We agree with Komatsu. At verification, the
Department tested those related party transactions that made
significant contributions to the subject merchandise. See cost
verification report dated October 25, 1993, page 7. Adjustments to
costs for transactions with other related party suppliers, even if
warranted, would not have significantly affected the margin analysis.
Comment 9: Komatsu argues that the Department should allow an
offset to the general and administrative expenses for the gains on
sales of plant assets recorded at its head office, which relate to the
company's general and administrative activities. Komatsu adds that
these gains should be offset against the company-wide general and
administrative expenses, in addition to the offset the Department
allowed for the gain on sales of plant assets at the Komatsu plant.
Petitioner argues that these gains do not appear to relate to the
production operations for subject merchandise, and therefore should be
excluded from the general and administrative expenses calculation.
Department's Position: We agree with the petitioner. During
verification, the respondent provided an exhibit that specifically
identified the gains that related to the Komatsu plant manufacturing
the subject merchandise. (See cost verification exhibit number 29.) No
documentation or other support was provided to establish a basis on
which to allow an offset for the gains on sales of the other plant
assets.
Comment 10: Aida states that the Department double counted an
adjustment it made to the cost variance and general and administrative
expenses in applying these adjustments to the CV format for one of the
U.S. sales.
Department's Position: We agree with Aida and have corrected the
adjustment to the cost variance and general and administrative
expenses.
Comment 11: Aida states, in its case brief, that the Department
made certain clerical errors in its calculations, with respect to
inland freight, packing, credit and warranty.
Department's Position: We agree, and have adjusted our calculations
accordingly.
Final Results of Review
As a result of our review, the Department has determined that the
following margins exist for the period February 1, 1992, through
January 31, 1993:
------------------------------------------------------------------------
Margin
Manufacturer/exporter (percent)
------------------------------------------------------------------------
Aida Engineering, Ltd........................................ 3.50
Komatsu Ltd.................................................. 0.00
Ishikawajima-Harima Heavy Ind................................ \1\0.00
Hitachi-Zosen Corporation.................................... \1\0.00
------------------------------------------------------------------------
\1\No shipments during the period. Rate is from the last final results
of review for this company.
Parties to the proceeding may request disclosure within 5 days of
the date of publication of this notice. The Department will instruct
the Customs Service to assess antidumping duties on all appropriate
entries. Individual differences between U.S. price and FMV may vary
from the percentages stated above. The Department will issue
appraisement instructions on each exporter directly to the Customs
Service.
Furthermore, the following deposit requirements will be effective
upon publication of this notice of final results of review for all
shipments of MTPs from Japan entered, or withdrawn from warehouse, for
consumption on or after the publication date, as provided for by
section 751(a)(1) of the Tariff Act: (1) The cash deposit rates for the
reviewed companies will be those established in the final results of
this administrative review; (2) for previously reviewed or investigated
companies not listed above, the cash deposit rate will continue to be
the company-specific rate published for the most recent period; (3) if
the exporter is not a firm covered in this review or the less than fair
value (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; and (4) the cash deposit rate for all
other manufacturers or exporters will be the ``all others'' rate
established in the final notice of the LTFV investigation of this case,
in accordance with the Court of International Trade's decisions in
Floral Trade Council v. United States, Slip Op. 93-79, and Federal
Mogul Corporation and the Torrington Company v. United States, Slip Op.
93-83. The all others rate is 14.51 percent. These deposit
requirements, when imposed, shall remain in effect until publication of
the final results of the next administrative review.
This notice serves as a final 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 subsequent assessment
of double antidumping duties.
This notice also serves as a reminder to parties subject to
administrative protective orders (APOs) of their responsibility
concerning the return or destruction of proprietary information
disclosed under APO in accordance with 19 CFR 353.34(d). Timely written
notification of the return/destruction of APO materials or conversion
to judicial protective order is hereby requested. Failure to comply
with the regulations and the terms of APO is a sanctionable violation.
This administrative review and notice are in accordance with
section 751(a)(1) of the Tariff Act (19 U.S.C. 1675(a)(1)) and 19 CFR
353.22.
Dated: February 22, 1994.
Joseph A. Spetrini,
Acting Assistant Secretary for Import Administration.
[FR Doc. 94-4736 Filed 3-1-94; 8:45 am]
BILLING CODE 3510-DS-P
