[Federal Register Volume 64, Number 89 (Monday, May 10, 1999)]
[Notices]
[Pages 25008-25011]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-11723]
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Notices
Federal Register
________________________________________________________________________
This section of the FEDERAL REGISTER contains documents other than rules
or proposed rules that are applicable to the public. Notices of hearings
and investigations, committee meetings, agency decisions and rulings,
delegations of authority, filing of petitions and applications and agency
statements of organization and functions are examples of documents
appearing in this section.
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Federal Register / Vol. 64, No. 89 / Monday, May 10, 1999 / Notices
[[Page 25008]]
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DEPARTMENT OF COMMERCE
International Trade Administration
[A-484-801]
Electrolytic Manganese Dioxide From Greece: Preliminary Results
of Antidumping Duty Administrative Review and Extension of Final
Results
AGENCY: Import Administration, International Trade Administration,
Department of Commerce.
ACTION: Notice of preliminary results of antidumping duty
administrative review and extension of final results.
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SUMMARY: In response to a request by a respondent, Tosoh Hellas A.I.C.,
and an interested party, Eveready Battery Corporation, the Department
of Commerce is conducting an administrative review of the antidumping
duty order on electrolytic manganese dioxide from Greece.
We have preliminarily determined that sales by Tosoh Hellas A.I.C.
have not been made below normal value. If these preliminary results are
adopted in our final results of administrative review, we will instruct
U.S. Customs to refund the amount of estimated antidumping duties that
it collected on all appropriate entries.
We invite interested parties to comment on these preliminary
results. Parties who submit comments in this proceeding are requested
to submit with each argument (1) a statement of the issue and (2) a
brief summary of the argument.
EFFECTIVE DATE: May 10, 1999.
FOR FURTHER INFORMATION CONTACT: Hermes Pinilla or Robin Gray, Import
Administration, International Trade Administration, U.S. Department of
Commerce, Washington, D.C. 20230; telephone: (202) 482-4733.
SUPPLEMENTARY INFORMATION:
The Applicable Statute and Regulations
Unless otherwise indicated, all citations to the Tariff Act of
1930, as amended (the 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 of Commerce's (the
Department's) regulations are to the regulations at 19 CFR part 351
(1998).
Background
On April 17, 1989, the Department published in the Federal Register
(54 FR 15243) the antidumping duty order on electrolytic manganese
dioxide (EMD) from Greece. On April 13, 1998, the Department published
a notice of ``Opportunity to Request Administrative Review'' with
respect to the antidumping duty order on EMD from Greece. Tosoh Hellas
A.I.C. (Tosoh) requested a review on April 29, 1998, and Eveready
Battery Company requested a review on April 30, 1998. In response to
these requests, the Department published a notice of initiation of
administrative review on May 29, 1998, in accordance with 19 CFR
351.213(b) (63 FR 29379). Although we initiated on both companies
(i.e., Tosoh and Eveready Battery Company), we are conducting an
administrative review only of Tosoh because Eveready Battery Company is
an importer and not a foreign manufacturer/exporter. On January 4,
1999, we extended the deadline for the preliminary results of the
review until April 29, 1999 (see 64 FR 85). The Department is
conducting this administrative review in accordance with section 751 of
the Act.
Scope of Review
Imports covered by this review are shipments of EMD from Greece.
This merchandise is currently classifiable under HTS item number
2820.10.0000. EMD is manganese dioxide (MnO2) that has been
refined in an electrolysis process. The subject merchandise is an
intermediate product used in the production of dry-cell batteries. EMD
is sold in three physical forms, powder, chip or plate, and two grades,
alkaline and zinc chloride. EMD in all three forms and both grades is
included in the scope of the order. The written product description
remains dispositive.
Extension of Final Results of Review
Section 751(a)(3)(A) of the Act requires the Department to make a
final determination within 120 days after the date on which the
preliminary determination is published. However, if it is not
practicable to complete the review within the foregoing time, the
Department may extend the 120-day period for making a final
determination to 180 days.
We determine that it is not practicable to issue the final results
of this review within 120 days for the reasons contained in the
Memorandum from Richard W. Moreland to Robert S. LaRussa, April 29,
1999, on file in Room B-099 of the Main Commerce Building. Therefore,
we are extending the due date for the final results of review to 180
days after the publication of these preliminary results of review.
Period of Review
The period of review (POR) is from April 1, 1997, through March 31,
1998.
Product Comparability and Home Market Viability
In an October 16, 1998, submission, and in several subsequent
submissions from Kerr-McGee Chemical LLC and Chemetals Inc.
(collectively ``Petitioners''), the Petitioners allege three points
concerning the selection of comparable merchandise: (1) the EMD grade
Tosoh sold in the home market is not a foreign like product under the
definition set forth in sections 771(16)(B) or (C) of the Act; (2) the
market for EMD in Greece is not viable within the meaning of section
773(a)(1)(C)(ii) of the Act; and (3) a particular market situation
exists which warrants rejection of home market sales for comparison
purposes.
We have preliminarily determined the following: 1) the subject
merchandise sold in Greece is a foreign like product as defined under
section 771(16)(B) of the Act; (2) the home market is viable within the
meaning of section 773(a)(1)(C)(ii) of the Act; and (3) a particular
market situation does not exist within the meaning of section
773(a)(1)(iii) of the Act.
First, we examined whether the EMD grade sold in the home market
met the standards of section 771(16)(B) of the Act. Specifically,
pursuant to section 771(16)(B) of the Act, we evaluated the following
criteria: (1) whether the
[[Page 25009]]
foreign like product was produced in the same country and by the same
person as the subject merchandise; (2) whether the merchandise in
question is like in component material or materials and in the purposes
for which used; and (3) whether the two grades (i.e., zinc-chloride and
alkaline) of EMD are approximately equal in commercial value.
Based on the information provided on the record we found that the
merchandise in question is produced in the same country and by the same
person as the subject merchandise. In addition, we found that both
grades of EMD are produced using the same component materials and both
grades are used in the production of dry-cell batteries.
With regard to the commercial-value criterion, we preliminarily
determine that the two products are ``approximately equal in commercial
value'' as set forth in section 771(16)(B)(iii) of the Act, based on
Tosoh's statement that ``there is no significant disparity between the
grades that would prevent their being used for a proper price-to-price
comparison.'' See Tosoh's January 25, 1999, submission at page 14. In
addition, the products satisfy our twenty-percent difference-in-
merchandise test which we generally apply to evaluate the commercial-
value criterion of the statute. We have solicited additional
information on this issue, however, and will analyze the issue further
before making our final determination.
Based on the reasons stated above, we determined that zinc-
chloride-grade EMD is a foreign like product as defined under section
771(16)(B) of the Act. For a detailed explanation of our analysis, see
the Decision Memorandum from Office Director to Deputy Assistant
Secretary dated April 29, 1999.
Second, we analyzed whether the home market for EMD is viable
within the meaning of section 773(a)(1)(C)(ii) of the Act. Section
773(a)(1)(B)(i) of the Act identifies normal value as the price at
which the foreign like product is first sold for consumption in the
exporting country. Pursuant to section 773(a) of the Act, the
Department will use sales in the home market as the basis for
calculating normal value unless one of the conditions in section
773(a)(1)(C) applies, in which case the Department may use third-
country sales as a basis for normal value. Where the home market is not
viable, the Department calculates normal value based on sales to a
viable third-country market or on constructed value. Under section
773(a)(1)(C)(ii) of the Act, the home market is viable where the
Department determines that the aggregate quantity (or, if quantity is
not appropriate, value) of the foreign like product sold by an exporter
or producer in a country is five percent or more of the aggregate
quantity (or value) of its sales of the like product to the United
States. The statute provides further that, where the aggregate quantity
(or value) of the foreign like product sold in the home market is below
five percent of the aggregate quantity (or value) of sales of the
subject merchandise in the United States, this amount will normally be
considered to be insufficient. See section 773(a)(1)(C) of the Act.
To determine whether sales of the foreign like product in the home
market are in sufficient quantity to form the basis for normal value,
we compared Tosoh's aggregate quantity of sales of the foreign like
product in the home market to the aggregate quantity of its sales of
the subject merchandise to the United States. Based on the information
submitted by Tosoh, we determined that Tosoh's home market sales exceed
the five-percent threshold required to find them viable as defined in
section 773(a)(1)(C)(ii) of the Act.
In their October 16, 1998, submission, the Petitioners note that
section 773(a)(1)(C)(iii) of the Act authorizes the Department to use
third-country sales for its price-to-price comparison when a particular
market situation in the exporting country does not permit a proper
comparison with the export price or constructed export price. Citing
the Department's decision to use third-country sales in the Final
Determination of Sales at Less Than Fair Value; Fresh Salmon From
Chile, 63 FR 31411 (June 9, 1998) (Salmon from Chile), the Petitioners
contend that there are several similarities between that case and this
one. For example, they assert that the key factors in the Department's
particular-market-situation determination in Salmon from Chile were
that the home market sales involved almost exclusively ``off-quality''
grades of salmon that were not sold in the United States and such sales
were incidental to respondents. According to the Petitioners,
comparable factors are also present in this case: (1) Tosoh's home
market sales during the review period consisted solely of a grade of
EMD for which there is no market in the United States; and (2) the home
market sales are for an aberrant use and of such small volume as to be
incidental to Tosoh. The Petitioners rely on the Statement of
Administrative Action (SAA) that accompanied the URAA, H. Doc. 103-316,
vol. 1, 103d Cong., 2d Sess. at 822 (1994), which, they assert,
establishes that a particular market situation might exist where a
single sale in the home market exceeds the quantitative viability
threshold of five percent or where there is government control over
pricing to such an extent that home market prices cannot be considered
to be set competitively. In addition, the Petitioners contend, the SAA
also mentions situations in which demand patterns are different in the
foreign market and the United States as a possible circumstance for
finding a particular market situation and basing normal value on sales
to a different market.
We have found no evidence of a particular market situation, within
the meaning of section 773(a)(1)(C)(iii) of the Act, which would
prevent a proper price comparison and which warrants a departure from
the normal five-percent viability test. For example, there is no
evidence to suggest that a single sale in the home market constitutes
five percent of sales to the United States, that there are extensive
government controls over pricing in the Greek home market, or that
there are differing patterns of demand for EMD in the United States and
in the home market. For a detailed explanation of our analysis, see our
Decision Memorandum.
Regarding the Petitioners' reliance on Salmon from Chile, in that
case the Department determined that a particular market situation
existed because the home market was incidental to the respondents'
operations. The Department found that the merchandise sold in the home
market was comprised mostly of ``industrial'' or ``off-quality'' grade
salmon (i.e., salmon with severe defects or of poor quality) sold
directly from the factory depending on availability whereas the
merchandise sold in the U.S. market was comprised of ``premium'' grade
sold through distributors. The record in this case does not demonstrate
that the EMD Tosoh sold in the home market had severe defects or was of
poor quality. In addition, unlike in Salmon from Chile, the respondent
in this case guarantees the quality of its products, regardless of EMD
grade, and both types of EMD grades meet the general specifications
customers required. Also, we have not found any evidence to suggest
that home market sales are incidental to Tosoh.
Therefore, we have used Tosoh's home market sales in our
determination of normal value for these preliminary results.
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Constructed Export Price
For the price to the United States, we used constructed export
price (CEP) as defined in section 772(b) of the Act. We calculated CEP
based on packed, carriage and insurance, or delivered price to
unaffiliated purchasers in the United States. We made deductions for
any movement expenses in accordance with section 772(c)(2)(A) of the
Act.
In accordance with section 772(d)(1) of the Act and the SAA (at
823-824), we calculated the CEP by deducting selling expenses
associated with economic activities occurring in the United States,
including direct selling expenses, and indirect selling expenses
incurred in the United States.
With respect to CEP profit, section 772(d)(3) of the Act requires
the Department, in determining CEP, to identify and deduct from the
starting price in the U.S. market an amount for profit allocable to
selling and further-manufacturing activities in the United States.
Section 772(f) of the Act provides the rule for determining the amount
of CEP profit to deduct from the CEP starting price. In this review,
since we do not have any cost information to calculate CEP profit, we
determined that the best available sources of profit information are
the 1997 financial statements which the respondent and its U.S.
affiliate submitted in response to section A of our questionnaire. See
Analysis Memorandum dated April 29, 1999.
Normal Value
In calculating normal value, as we stated above, we determined that
the quantity of foreign like product sold by the respondent 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)(1) of the Act because the quantity of sales in the home
market was greater than five percent of the sales to the U.S. market.
Therefore, in accordance with section 773(a)(1)(B)(i) of the Act, we
based normal value on the price at which the foreign like product was
for consumption in the exporting country. See Analysis Memorandum dated
April 29, 1999.
We calculated monthly, weighted-average normal values. Because
identical merchandise was not sold during the relevant contemporaneous
period, we compared U.S. sales to sales of the most similar foreign
like product in accordance with section 771(16)(B) of the Act.
Home market prices were based on packed, free-on-truck prices to
the unaffiliated purchasers in the home market. Where applicable, we
made adjustments for differences in packing and for movement expenses
in accordance with sections 773(a)(6)(A) and (B) of the Act. We also
made adjustments for differences in costs attributable to differences
in physical characteristics of the merchandise pursuant to section
773(a)(6)(C)(ii) of the Act.
Level of Trade
To the extent practicable, we determined normal value for sales at
the same level of trade as the U.S. sales in accordance with section
773(a)(1)(B) of the Act. The normal value level of trade is that of the
starting-price sales in the home market, as adjusted under section
772(d) of the Act. See 19 CFR 351.412(c)(ii).
To determine whether home market sales were at a different level of
trade than U.S. sales, we examined stages in the marketing process and
selling functions along the chain of distribution between the producer
and the unaffiliated customer. Tosoh reported one channel of
distribution in the home market. Therefore, we found that the one home
market channel constituted one level of trade. All of Tosoh's U.S.
sales were CEP sales. In this case, we identified the level of trade
based on the price after the deduction of expenses and profit under
section 772(d) of the Act. Based on our analysis, we considered CEP
sales to constitute a single level of trade. Based on the record, we
found that there were significant differences between the selling
activities associated with the home market level of trade and those
associated with the CEP level of trade. Therefore, we determined that
CEP sales are at a different level of trade than the home market sales.
Consequently, we could not match U.S. sales to sales at the same level
of trade in the home market. Moreover, data necessary to determine a
level-of-trade adjustment was not available. Therefore, because home
market sales were made at a more advanced stage of distribution than
that of the CEP level, we made a CEP-offset adjustment when comparing
CEP and home market sales in accordance with section 773(a)(7)(B) of
the Act. For a more detailed description of our analysis, see the
Level-of-Trade section of our Analysis Memorandum dated April 29, 1999.
Preliminary Results of Review
As a result of our review, we preliminarily determine the weighted-
average dumping margin for the period April 1, 1997, through March 31,
1998 to be as follows:
------------------------------------------------------------------------
Margin
Company (Percent)
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Tosh........................................................ 0.00
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Public Comment
Because we are requesting additional information, we will establish
a briefing schedule at a later date. Parties should contact the
Department within 15 days of the date of publication of this notice for
the briefing and hearing schedule. A list of authorities used, a table
of contents, and an executive summary of issues should accompany any
briefs submitted to the Department. Executive summaries should be
limited to five pages total, including footnotes.
Interested parties who wish to request a hearing, or to participate
if one is requested, must submit a written request within 30 days of
the publication of this notice. Requests should specify the number of
participants and provide a list of the issues to be discussed.
Oral presentations will be limited to issues raised in the briefs.
All memoranda to which we refer in this notice can be found in the
public reading room, located in the Central Records Unit, room B-099 of
the main Department of Commerce building. Any hearing, if requested,
will be held three days after the scheduled date for submission of
rebuttal briefs.
The Department will publish the final results of this
administrative review, including the results of its analysis of issues
raised in any such written briefs or hearing. The Department will issue
final results of this review within 180 days of publication of these
preliminary results.
Upon completion of the final results of this administrative review,
if there is no change from our preliminary results, we will instruct
the U.S. Customs Service to liquidate all appropriate entries at
without regard to antidumping duties.
Furthermore, the following deposit requirements will be effective
for all shipments of the subject merchandise 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: (1) the cash-deposit rate for Tosoh will be the
rate established in the final results of this review (except that no
deposit will be required if the firm has a zero or de minimis margin,
i.e., a margin less than 0.5 percent); (2) for previously reviewed or
investigated companies not listed
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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, a prior review, or the original less-than-
fair-value investigation (LTFV), 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 36.72 percent. This is
the ``all others'' rate from the LTFV investigation which we are
reinstating in accordance with the decisions by the Court of
International Trade in Floral Trade Council v. United States, Slip Op.
93-79 (May 25, 1993), and Federal-Mogul Corporation and The Torrington
Company v. United States, Slip Op. 93-83 (May 25, 1993). These cash-
deposit rates, when imposed, shall remain in effect until publication
of the final results of the next administrative review.
This notice also serves as a preliminary 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 Secretary's presumption that
reimbursement of antidumping duties occurred and the subsequent
assessment of double antidumping duties.
We are issuing and publishing this determination in accordance with
sections 751(a)(1) and 777(i)(1) of the Act.
Dated: April 29, 1999.
Richard W. Moreland,
Acting Assistant Secretary for Import Administration.
[FR Doc. 99-11723 Filed 5-7-99; 8:45 am]
BILLING CODE 3510-DS-P
