[Federal Register Volume 59, Number 94 (Tuesday, May 17, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-11968]
[[Page Unknown]]
[Federal Register: May 17, 1994]
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DEPARTMENT OF COMMERCE
International Trade Administration
[A-122-503]
Final Results of Antidumping Duty Administrative Review; Iron
Construction Castings From Canada
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 January 3, 1994, the Department of Commerce published in
the Federal Register the preliminary results of an administrative
review of the antidumping duty order on iron construction castings from
Canada. The review covered 11 manufacturers and/or exporters of the
subject merchandise to the United States during the period March 1,
1992, through February 28, 1993. Based on our analysis of comments
received, the dumping margins for the original 11 companies have not
changed from the margins presented in the preliminary results. However,
we have found that three additional companies are related to
respondents in this review and have assigned cash deposit rates to
reflect this relationship.
EFFECTIVE DATE: May 17, 1994.
FOR FURTHER INFORMATION CONTACT: Lisa Raisner, Office of Antidumping
Compliance, International Trade Administration, U.S. Department of
Commerce, Washington, DC 20230, telephone: (202) 482-3518.
SUPPLEMENTARY INFORMATION:
Background
On January 3, 1994, the Department of Commerce (the Department)
published in the Federal Register the preliminary results of an
administrative review (59 FR 65) of the antidumping duty order on iron
construction castings from Canada (51 FR 17220). The Department has now
completed this administrative review in accordance with section 751 of
the Tariff Act of 1930, as amended (the Tariff Act).
Scope of the Review
Imports covered by this review are shipments of certain iron
construction castings from Canada, limited to manhole covers, rings,
and frames, catch basin grates and frames, cleanout covers and frames
used for drainage or access purposes for public utility, water, and
sanitary systems, classifiable as heavy castings under Harmonized
Tariff Schedule (HTS) item numbers 7325.10.0010 and 7325.10.0050 and to
valve, service, and meter boxes which are placed below ground to encase
water, gas, or other valves, or water and gas meters, classifiable as
light castings under HTS item numbers 8306.29.0000 and 8310.00.0000.
The HTS item numbers are provided for convenience and Customs purposes
only. The written description remains dispositive.
This review covers sales of certain Canadian iron construction
castings by Associated Foundry Ltd., Bibby Foundry Ltd., Bibby
Waterworks Inc., Dobney Foundry Ltd., Bibby St. Croix, LaPerle Foundry
Division (LaPerle), McCoy Foundry Company, Penticton Foundry Ltd.,
Titan Foundry Ltd., Titan Supply Ltd., and Trojan Industries, Inc.,
during the period March 1, 1992, through February 28, 1993. In
addition, based on our analysis, we have found that three other
companies, for which we did not initiate an administrative review, are
related to respondents in this review and have, therefore, been
assigned cash deposit rates to reflect this relationship.
Clerical Error
The first-tier BIA rate used in the notice of preliminary results
of review was listed as 9.9 percent. We have corrected this error for
the final results and have used the rate of 9.8 percent as listed in
Iron Construction Castings from Canada; Amendment to Final
Determination of Sales at Less than Fair Value and Amendment to
Antidumping Duty Order (51 FR 34110, September 25, 1986). We have also
corrected references to this rate in all comments addressed below.
Analysis of Comments Received
We gave interested parties an opportunity to comment on the
preliminary results. We received written comments and rebuttal briefs
from the Municipal Castings Fair Trade Council and its individually-
named members (petitioner) and LaPerle.
Comments Regarding the Collapsing of Related Parties
Comment 1: Petitioner supports the Department's analysis of the
relationship between LaPerle and other respondents in this review and
its use of the methodology outlined in the preliminary results, most
recently upheld in Nihon Cement Co., Ltd., et al. v United States, et
al., Slip Op. 93-80 (May 25, 1993), and argues that the Department
properly determined that LaPerle is related to other respondents in
this review.
LaPerle argues that the Department improperly determined that
LaPerle's response should be collapsed with responses of other
entities. Although it does not dispute the fact that it is related to
the other companies listed by the petitioner, LaPerle maintains that it
is an autonomous operation and further asserts that each of the related
companies covered by this review also operated as distinct and separate
entities during the period of review.
LaPerle also maintains that the decision to collapse in this
administrative review directly contradicts the Department's decision in
an earlier review not to require Bibby Ste-Croix to submit information
regarding sales of castings produced by Laperle because the two
companies operated as separate entities (see Iron Construction Castings
from Canada, 55 FR 460, January 5, 1990).
Department's Position: During the questionnaire process, LaPerle
provided no evidence to demonstrate that it was an independent entity.
In fact, analysis of the information provided by LaPerle proved the
contrary. Further, LaPerle's comment does not cite to any relevant
factual information on record, other than the geographical distance
between several of the components and specific product-line
differences, in support of its claim that LaPerle and each of its
related parties were autonomous.
In this review, we received only one questionnaire response, and
that was from LaPerle. Based on our analysis of this response, for the
preliminary results we determined that LaPerle was related to other
respondents in this review. In doing so, we determined that LaPerle and
its related entities met all five criteria, in addition to ownership,
that the Department considers in determining whether to collapse
related parties, as laid out in the preliminary results and in Certain
Granite Products from Spain, 53 FR 24335, 1988; Certain Granite
Products from Italy, 53 FR 27187, 1988; Steel Wheels from Brazil, 54 FR
8780, 1989; Cellular Mobile Telephones and Subassemblies from Japan, 54
FR 48011, 1989; and Final Determinations of Sales at Less Than Fair
Value: Certain Hot-Rolled Carbon Steel Flat Products, Certain Cold-
Rolled Carbon Steel Flat Products, Certain Corrosion-Resistant Carbon
Steel Flat Products, and Certain Cut-to-Length Carbon Steel Plate from
Canada, 58 FR 37099 (July 9, 1993). The five criteria, in addition to
ownership, are as follows:
Interlocking boards of directors
Similar production processes, facilities or equipment so
as to facilitate shifting of production between facilities
Do not operate as separate and distinct entities
Share of marketing and sales information or offices
Involvement in the pricing or production decisions of the
other entity
In response to LaPerle's claim that we are contradicting our
earlier decision, we have determined that the record of this review
differs substantially from that of the previous review in the amount of
information we requested and the level of inter-relatedness which the
information in this review shows. We consider these relationships to be
sufficient to allow for price manipulation and involvement in pricing
and/or production decisions (see analysis and decision memoranda for
preliminary results). Therefore, we properly determined that LaPerle is
related to, and should be collapsed with, other respondents in this
review.
Comment 2: The petitioner asserts that the Department should also
collapse Grand Mere with LaPerle for these final results because public
information on the record of this review indicates that Grand Mere is
related to LaPerle.
LaPerle responds that the Department should not collapse Grand Mere
or any other related party with LaPerle for this review. LaPerle
further argues that petitioner's attempt to collapse a non-reviewed
firm with LaPerle in this review is untimely.
Department's Position: Based on our criteria, as listed above, the
information on the record indicates that three other companies, in
addition to those included in the notice of initiation of
administrative review, are sufficiently related to be collapsed with
LaPerle and will be included in this administrative review for purposes
of future entries and cash deposit rates. (For more information, see
the analysis memorandum for these final results.) Therefore, we will
instruct Customs to require cash deposits and assess estimated
antidumping duties in the amount of the rate assigned to the entire
entity.
The issue of timeliness is not relevant in this instance because we
are treating LaPerle and all its related companies as a single entity.
Therefore, in effect, we are now reviewing one single company,
comprised of various individual components, including LaPerle. The fact
that three of these individual components were not included in the
notice of initiation of this review is immaterial because we are
treating the various components as one entity.
Comment Regarding the Use of Best Information Available
Comment 3: Petitioner contends that despite the numerous
opportunities LaPerle was given to submit information to the Department
in support of its claim of being autonomous, the information LaPerle
submitted only indicated the contrary. Further, because it failed to
consolidate all information for itself, as outlined in the Department's
questionnaire, LaPerle's questionnaire response and additional
submissions do not constitute cooperation.
Therefore, the petitioner maintains that the Department properly
determined that LaPerle significantly impeded the proceedings and
correctly applied first-tier best information available (BIA) in this
review. The petitioner argues, however, that the BIA rate should be
higher than the BIA rate used for the preliminary results in order to
encourage compliance in future administrative reviews. The petitioner
further suggests the possibility that, following the Department's two-
tiered methodology, the respondents in this case could have predicted
the worst-case outcome of the administrative review.
The petitioner argues that the Department's selection of 9.8
percent applied as BIA in the preliminary results is not significantly
greater than the rates that currently apply and therefore will not
encourage future compliance. As such, the Department would be justified
in departing from its normal BIA methodology by selecting a higher
rate. The petitioner points out that the courts have held that the
Department is not required to choose a rate that is precisely accurate
but instead is to choose a rate that is ``usable'', citing Allied-
Signal Aerospace Co. v. United States, 13 CIT 13, 28, 704 F.Supp. 1114,
1126 (1989), appeal after remand, 13 CIT 526, 717 F.Supp. 834 (1989),
aff'd, 901 F.2d 1089 (Fed. Cir. 1990), cert.denied sub nom, and
Floramerica, S.A. v. United States, 498 U.S. 848 (1990). Petitioner
also points out that the Department has departed from its two-tiered
approach when necessary in Cold-Rolled Stainless Steel Sheet from
Germany; Final Results of Antidumping Duty Administrative Review, (59
FR 15888, April 5, 1994 ), aff'd Krupp Stahl A.G. v. United States, 822
F.Supp. 789 (CIT 1993). Accordingly, the petitioner argues the
Department should apply the higher rate of 33.46 percent, which is the
rate determined for a respondent in the preliminary results of the
1985-1987 administrative review of the subject merchandise (Iron
Construction Castings from Canada, 56 FR 274, May 21, 1991), as BIA.
LaPerle states that the Department should not have resorted to BIA,
particularly punitive BIA, for purposes of its preliminary results
because LaPerle fully cooperated with the Department in every respect,
responded to all requests for information, and was preparing for
verification. LaPerle argues that, if the Department still deems use of
BIA is necessary for the final results, the Department should use the
second-tier rate.
LaPerle argues that petitioner's reference to Allied-Signal, while
it does lend support to the Department's use of 9.8 percent as BIA,
does not offer a precedent for use of a preliminary results margin
rate. LaPerle further argues petitioner's cite to Krupp Stahl is also
misleading because the factual situation in this administrative review
is distinctly different. In addition, in Krupp Stahl, the respondent
was clearly uncooperative and impeded the proceeding by failing to
respond to a new questionnaire and destroying the records necessary to
verify the adequacy of the information submitted in the earlier
response.
LaPerle also refutes petitioner's allegation that it could have
predicted the worst-case outcome of the administrative review,
suggesting it would have been more efficient, in that case, to refuse
to respond to any requests for information. Finally, LaPerle argues
that the 9.8 percent rate used by the Department in its preliminary
results is highly punitive in comparison to LaPerle's existing cash
deposit rate of 3.16 percent from the most recent final results of
administrative review.
Department's Position: While LaPerle provided information during
the review, our analysis of information on the record indicated that
LaPerle was not independent, but was, in fact, one of many components
of a single entity. Therefore, the single entity, comprised of many
components including LaPerle, became, in effect, the respondent in this
review.
In Allied-Signal, the Court affirmed our two-tiered BIA
methodology, noting that
Whether the first or second tier properly applies to a
nonresponsive respondent essentially turns on the level of
cooperation exhibited by the respondent during the review. In order
to apply the first tier to a particular respondent, the ITA must
conclude that the respondent ``refused to cooperate with the [ITA]
or otherwise significantly impeded'' the review.
(See Allied-Signal, p.15.) Once the Department determined that the
related parties in this case must be collapsed, LaPerle was given the
opportunity, through two supplemental questionnaires, to supply the
additional data. However, LaPerle failed to provide complete
information on the related parties. The other named respondents, who
were also collapsed with LaPerle, did not respond. Therefore, only a
small fraction of the required information was provided while a
significant quantity remained unreported. Accordingly, the application
of first-tier BIA is appropriate because LaPerle impeded the proceeding
by failing to give the Department the information necessary to conduct
the review and by failing to provide any support for its position that
LaPerle was independent.
Finally, we believe the 9.8 percent rate we have chosen is
consistent with a first-tier BIA approach. The 33.46 percent rate
suggested by the petitioner was from a notice of preliminary results.
Because the factual situation in this administrative review differs
from that in Krupp Stahl, we do not consider this rate appropriate to
be used for these final results. In Krupp Stahl, because it was the
first administrative review, the only rates available for BIA were from
the preliminary and final results of the less-than-fair-value (LTFV)
investigation. In order to assign a rate higher than the calculated
rate that Krupp had received in the LTFV investigation, where Krupp had
cooperated, the Department had no choice but to resort to the
preliminary results; otherwise, Krupp would have been in a better
position as a result of its noncompliance (see Krupp Stahl at 793) than
if it had responded to the Department's questionnaire. However, in this
case, we do have other final rates available and appropriate for BIA.
Because the 9.8 percent BIA rate we have chosen is higher than any
individual rate that currently applies to LaPerle and its related
entities, we believe that the rate is adverse and will achieve the
objective of encouraging complete responses in future reviews.
Therefore, we believe that the 9.8 percent rate chosen is both
appropriate and consistent with a first-tier BIA rate approach.
Comment 4: The petitioner argues that, apart from impeding the
proceeding in connection with the respondents' business relationships,
additional grounds exist for the Department to apply BIA: inconsistent
product codes; incorrect model match methodology; incorrect dates of
sales; and missing information regarding COP data, product matches,
difference-in-merchandise (difmer) adjustments, level of trade
information, and general and administrative expenses in COP incurred on
behalf of LaPerle by its related companies.
LaPerle counters that its response is not grossly deficient: COP
data, product concordance, and difmer adjustments were provided;
LaPerle maintains that its model match methodology is correct and its
level-of-trade information and dates of sale are appropriate; and,
finally, because its operations were independent of the other
companies, LaPerle thought it inappropriate to include general and
administrative costs for these entities in its COP (and thought that
even if it were appropriate, some of LaPerle's expenses would have to
be allocated to those entities).
Department's Position: Because LaPerle failed to submit a
consolidated response, the information provided was inadequate for
purposes of our analysis. Therefore, the issue of deficiencies in what
information was, in fact, submitted is moot.
Final Results of the Review
After analysis of the comments received, we determine that the
following weighted-average margins exist, and have been applied based
on relationship and/or failure to respond, for the period March 1, 1992
through February 28, 1993:
------------------------------------------------------------------------
Percent
Manufacturer/exporter margin
------------------------------------------------------------------------
Associated Foundry Ltd..................................... 9.8
Bibby Foundry Ltd.......................................... 9.8
Bibby Waterworks Inc....................................... 9.8
Dobney Foundry Ltd......................................... 9.8
Bibby St. Croix (to include: Bibby Ste-Croix Founderies,
Inc. and Bibby Ste-Croix Division)........................ 9.8
LaPerle Foundry, Inc....................................... 9.8
McCoy Foundry Company...................................... *7.5
Penticton Foundry Ltd...................................... 9.8
Titan Foundry Ltd.......................................... 9.8
Titan Supply Ltd........................................... 9.8
Trojan Industries, Inc..................................... 9.8
------------------------------------------------------------------------
*No shipments during the period; since there was no prior review of this
company, we assigned the all other rate from the less-than-fair-value
(LTFV) investigation.
The Department shall determine, and the Customs Service shall
assess, antidumping duties on all appropriate entries. The Department
will issue appraisement instructions on each exporter directly to the
Customs Service. We will also instruct Customs to collect cash deposits
for the three additional companies, which were collapsed with LaPerle
for purposes of these final results, at the rate assigned to LaPerle.
Furthermore, the following deposit requirements will be effective,
upon publication of this notice of final results of administrative
review, for all shipments of the subject merchandise from Canada that
are entered, or withdrawn from warehouse, for consumption on or after
the publication date of this notice, as provided by section 751(a)(1)
of the Tariff Act: (1) The cash deposit rates for the reviewed
companies will be those rates outlined above; (2) for previously
reviewed or investigated companies not listed above, the cash deposit
rate will continue to be their company-specific rate published for the
most recent period; (3) if the exporter is not a firm covered in this
review or the original 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) if neither the
exporter nor the manufacturer is a firm covered in this or any previous
review, the cash deposit rate will be 7.5 percent, which is the ``all
other'' rate established in the LTFV investigation, as discussed below.
On May 25, 1993, the Court of International Trade (CIT), 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, decided that once an ``all others'' rate is established for a
company, it can only be changed through an administrative review. The
Department has determined that in order to implement these decisions,
it is appropriate to reinstate the ``all others'' rate from the LTFV
investigation (or that rate as amended for correction of clerical
errors or as a result of litigation) in proceedings governed by
antidumping duty orders.
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 the subsequent
assessment of double antidumping duties.
This notice also serves as the only reminder to parties subject to
administrative protective order (APO) of their responsibility
concerning the disposition of proprietary information disclosed under
APO in accordance with 19 CFR 353.34(d). Timely written notification of
return/destruction of APO materials or conversion to judicial
protective order is hereby requested. Failure to comply with the
regulations and the terms of the 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: May 9, 1994.
Susan G. Esserman,
Assistant Secretary for Import Administration.
[FR Doc. 94-11968 Filed 5-16-94; 8:45 am]
BILLING CODE 3510-DS-P
