[Federal Register Volume 63, Number 133 (Monday, July 13, 1998)]
[Notices]
[Pages 37516-37520]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-18596]
[[Page 37516]]
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DEPARTMENT OF COMMERCE
International Trade Administration
[A-421-805]
Aramid Fiber Formed of Poly Para-Phenylene Terephthalamide From
the Netherlands; Final Results of Antidumping Administrative Review
AGENCY: Import Administration, International Trade Administration,
Department of Commerce.
ACTION: Notice of Final Results of the Antidumping Duty Administrative
Review; Aramid Fiber Formed of Poly Para-Phenylene Terephthalamide from
the Netherlands.
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SUMMARY: On March 9, 1998, the Department of Commerce (the Department)
published the preliminary results of its administrative review of the
antidumping duty order on aramid fiber formed of poly para-phenylene
terephthalamide (PPD-T aramid) from the Netherlands. The review covers
one manufacturer/exporter and the period June 1, 1996 through May 31,
1997.
We gave interested parties an opportunity to comment on our
preliminary results. Based on our analysis of the comments received, we
have revised the results from those presented in the preliminary
results of review.
EFFECTIVE DATE: July 13, 1998.
FOR FURTHER INFORMATION CONTACT: Nithya Nagarajan at (202) 482-1324 or
Eugenia Chu at (202) 482-3964, Import Administration, International
Trade Administration, U.S. Department of Commerce, 14th Street and
Constitution Avenue, N.W., Washington, D.C. 20230.
Applicable Statute
Unless otherwise indicated, all citations to the statute are
references to the provisions effective January 1, 1995, the effective
date of the amendments made to the Tariff Act of 1930 (the Act) by the
Uruguay Round Agreements Act (URAA). In addition, unless otherwise
indicated, all references to the Department's regulations are to 19 CFR
Part 353 (1997).
SUPPLEMENTARY INFORMATION:
Background
The Department published in the Federal Register the antidumping
duty order on PPD-T aramid from the Netherlands on June 24, 1994 (59 FR
32678). On June 11, 1997, we published in the Federal Register (62 FR
31786) a notice of opportunity to request an administrative review of
the order covering the period June 1, 1996, through May 31, 1997.
In accordance with 19 CFR 353.22(a)(1), Aramid Products V.o.F. and
Akzo Nobel Aramid Products, Inc. (collectively ``Akzo'' or respondent),
and petitioner, E.I. DuPont de Nemours and Company (petitioner),
requested that we conduct an administrative review for the
aforementioned period of review (POR). We published a notice of
initiation of this antidumping duty administrative review on August 1,
1997 (62 FR 41339). The Department is conducting this administrative
review in accordance with section 751 of the Act.
On March 9, 1998, the Department published the preliminary results
of the review. (See 63 FR 11408). The Department has now completed the
review in accordance with section 751 of the Act.
Scope of the Review
The products covered by this review are all forms of PPD-T aramid
from the Netherlands. These consist of PPD-T aramid in the form of
filament yarn (including single and corded), staple fiber, pulp (wet or
dry), spun-laced and spun-bonded nonwovens, chopped fiber and floc.
Tire cord is excluded from the class or kind of merchandise under
review. This merchandise is currently classifiable under the Harmonized
Tariff Schedule (HTS) item numbers 5402.10.3020, 5402.10.3040,
5402.10.6000, 5503.10.1000, 5503.10.9000, 5601.30.0000, and
5603.00.9000. The HTS item numbers are provided for convenience and
Customs purposes. The Department's written description of the scope
remains dispositive.
Analysis of the Comments Received
We gave interested parties an opportunity to comment on the
preliminary results of review. We received comments from respondent and
petitioner.
Comment 1: Petitioner contends that the Department should revise
Akzo's reported U.S. indirect selling expenses (ISE), arguing that the
calculation was improperly based on the consolidated financial
statements of Akzo Nobel Inc., and should have instead been based upon
the financial statements of Akzo Nobel Aramid Product Inc.'s (ANAPI--
the exclusive sales agent of Aramid Products V.o.F. in the United
States (Aramid)). Petitioner also asserts that the Department should
reject Akzo's use of consolidated financial data in calculating the net
interest expenses included in Aramid's cost of production so as to
reflect Aramid's actual financing expenses. Petitioner acknowledges
that the Department generally uses consolidated financial expense data
to calculate financing expenses. However, petitioner asserts that this
is not an automatic requirement. Further, petitioner contends that the
Department must not use consolidated data where using the consolidated
data would distort actual financing expenses. Petitioner asserts that
such would be the case in the instant circumstance because Akzo's
reported financial interest expense factor is unrelated to the
financing requirements of Akzo's PPD-T aramid fiber business in the
United States. Moreover, petitioner argues that Akzo justifies its use
of consolidated figures on the grounds that the U.S. parent borrows on
behalf of its related companies, and then charges the units a share of
this cost, without explaining how it allocates the financing expenses.
Petitioner argues that Akzo calculated the reported financing expenses
based on outstanding loans between the U.S. parent and ANAPI and
speculates as to the reasons why ANAPI borrowed money from its parent
company to finance its U.S. operations.
Petitioner further argues that the Department and the Court of
International Trade (CIT) misapplied binding precedent when affirming
the Department's use of Akzo's consolidated data in E.I. DuPont de
Nemours & Co. v. United States, No. 96-11-02509, Slip Op. 98-7, 1998 WL
42598 (CIT Jan. 29, 1998) (E.I. DuPont). Moreover, petitioner contends
that the Department and the CIT failed to follow the express mandate of
the 1994 amendments to the antidumping statute, which directs the
Department to capture all actual costs incurred in producing the
subject merchandise and to ensure that reported costs constitute a
representative measure of the respondent's true costs. Petitioner
argues that the CIT incorrectly interpreted the Statement of
Administrative Action (SAA), accompanying H.R. 5110, 103rd Cong., at
834-835 (1994), which according to petitioner, requires a change in the
Department's practice with respect to the calculation of financing
costs.
Akzo argues that the CIT decision in E.I. DuPont properly affirmed
the Department's use of Akzo's consolidated financial expense in the
first administrative review. Akzo urges the Department to follow the
same methodology in the final results of the third administrative
review. Further, Akzo emphasizes that petitioner did not point to any
evidence justifying a deviation from the Department's standard practice
of using the parent's consolidated interest expense in cases where the
parent's majority ownership
[[Page 37517]]
is prima facie evidence of corporate control.
Additionally, Akzo argues that petitioner's claims that the
amendments to the antidumping statute set a new standard for
calculating interest expense is in error. Contrary to petitioner's
argument, Akzo contends that neither the SAA nor the amended section
773(f) of the antidumping statute directs the Department to change its
existing practice. Akzo further contends that the cited portion of the
SAA suggests only two distinct changes in the law that do not affect
Commerce's past practice at issue here, as the CIT explained in E.I.
DuPont at 7-9.
Akzo further buttresses its argument by pointing to evidence in the
administrative record demonstrating that the interest expense of the
consolidated company reflects the actual interest expense incurred.
Akzo claims that the only loans and corresponding interest expense on
the books of ANAPI and Aramid are intercompany loans from the parent
companies, Akzo Nobel Inc. and Akzo Nobel N.V. In addition, Akzo argues
that the Department verified that the financial statements of the
subsidiary companies are consolidated with those of the parent
companies. Akzo explains that the only actual interest expense is
recorded on the books of the parent companies because it is only these
entities that actually borrow money and incur the related interest
expense. Akzo asserts that it is only the parent that determines the
sources of money, borrows the money, and incurs the actual interest
expense and that therefore, petitioner's speculations on how and why
companies borrow money and how a parent determines the amount of loans
and interest are irrelevant because these are internal decisions that
take into account a variety of factors.
Department's Position: We agree with Akzo. In the prior first and
second administrative reviews, petitioner similarly urged the
Department to rely on Aramid's own financial records to determine its
net interest expense, instead of following the Department's normal
practice of using the parent company's financing expenses incurred on
behalf of the consolidated group of companies. The Department disagreed
with petitioner's position, explaining in detail that any departure
from the Department's normal practice in this case was not warranted in
light of Akzo Nobel N.V.'s majority ownership interest in Aramid, which
constituted prima facie evidence of the parent's corporate control. For
a detailed explanation of this issue, see Aramid Fiber Formed of Poly-
Phenylene Terephthalamide from the Netherlands: Final Results of
Antidumping Administrative Review, 61 FR 51406 (1996); Aramid Fiber
Formed of Poly-Phenylene Terephthalamide from the Netherlands: Final
Results of Antidumping Administrative Review, 62 FR 38058 (1997).
On January 29, 1998, the CIT affirmed the Department's
determination, ruling that neither the SAA nor the amended statute
mandate a change of practice with respect to using a parent company's
consolidated statements when calculating the respondent's interest
expense ratio, and that this practice is consistent with the principle
of allocating costs in a manner that reasonably reflects the actual
costs. E.I. DuPont at 8-9. (Emphasis added.) Citing Gulf States Tube
Div. of Quanex Corp. v. United States, Slip Op. 97-124, Consol. Court
No. 95-09-01125, at 38-39 (CIT Aug. 29, 1997), the Court noted that the
focus of the analysis is on whether the consolidated group's
controlling entity has the power to determine the capital structure of
each member of the group. The Court concluded that the administrative
record in this case supported the Department's finding that Akzo Nobel
N.V. was a controlling entity, and that DuPont did not cite evidence
which would overcome the presumption of corporate control.
In the instant administrative review, petitioner merely reiterates
its position argued in the previous two reviews and does not point to
any new evidence in the administrative record, which would demonstrate
that the parent, Akzo Nobel N.V., does not exercise corporate control
over the respondent company. Thus, consistent with the Department's
prior determinations and the CIT's decision in E.I. DuPont, we will
continue using Akzo Nobel N.V.'s consolidated financial interest
expense in computing the respondent's net interest ratio.
Similarly, petitioner's contention that we should revise Akzo's
reported U.S. indirect selling expense (ISE) lacks merit. As the
Department stated in the prior administrative reviews, the Department
bases its calculations on the consolidated financial statements of the
parent, not the subsidiary. This method is grounded in a well-
established practice. See Aramid Fiber Formed of Poly-Phenylene
Terephthalamide from the Netherlands: Final Results of Antidumping
Administrative Review, 61 FR at 51407; Aramid Fiber Formed of Poly-
Phenylene Terephthalamide from the Netherlands: Final Results of
Antidumping Administrative Review, 62 FR at 38060. As stated above, the
focal point of the analysis is upon the parent company's control over
the subsidiary. The record contains sufficient evidence of Akzo Nobel
Inc.'s corporate control over ANAPI. More importantly, the petitioner
has failed to produce any evidence to rebut the prima facie evidence of
Akzo's control over ANAPI. For the reasons stated above, we will
continue to adhere to the Department's current practice in this final
determination.
Comment 2: Petitioner alleges that ANAPI is being reimbursed for
antidumping duty deposits by one of its parent companies and argues
that the Department should deduct the deposits from Akzo's U.S. price,
or at least include the associated imputed financing expenses in Akzo's
U.S. ISE. Petitioner claims that although there are no reimbursement
agreements, the summary trial balances of ANAPI and the Annual Reports
of Akzo Nobel Inc. support this allegation. Moreover, petitioner cites
Hoogovens Staal BV v. AK Steel Corp., 1998 WL 118090 (CIT March 13,
1998) (Hoogovens), as a case affirming the Department's authority to
subtract reimbursed antidumping duty deposits, reasoning that the
antidumping duties were intended to cause importers to raise prices to
take into account such duties. Petitioner argues that the fact that
Akzo has not raised its prices by anywhere close to 66 percent since
the antidumping duty order was published further supports its claim
that ANAPI is relieved of the responsibility for the antidumping duties
and speculates that certain amounts may be reimbursed by either Akzo
Nobel Inc. or Akzo Nobel N.V.
Akzo contends that ANAPI is not being reimbursed for antidumping
duties and the petitioner's speculation to the contrary should be
disregarded. Akzo cites the Department's regulations, 19 CFR 353.26(a),
requiring the Department to deduct from U.S. price the amount of any
antidumping duty which the producer or reseller paid directly on behalf
of the importer or reimbursed to the importer. Akzo notes that this
regulation also requires the importer to file a certificate, prior to
liquidation, with the U.S. Customs Service, attesting to the absence of
any agreement for the payment or reimbursement of any part of the
antidumping duties by the manufacturer, producer, seller or exporter.
The regulation provides that the Department may presume from an
importer's failure to file this certificate that the producer or
reseller paid or reimbursed the antidumping duties. Akzo argues that it
is in full compliance with the Department's regulations. It
[[Page 37518]]
states ANAPI has filed, prior to liquidation, certifications with
Customs attesting to the absence of any agreement with the
manufacturer, producer, seller or exporter for the payment or
reimbursement of antidumping duties that, as required by section
353.26(c). Further, the respondent claims that ANAPI has not entered
into such an agreement with Akzo Nobel Inc. or Akzo Nobel N.V. In
support of its arguments, Akzo cites the CIT ruling in The Torrington
Corp. v. United States, 881 F. Supp. 622, 632 (1995) (Torrington) that
``once an importer * * * has indicated on this certificate that it has
not been reimbursed for antidumping duties, it is unnecessary for the
Department to conduct an additional inquiry absent a sufficient
allegation of customs fraud.'' Akzo claims that, because it has filed
the requisite certification, and because petitioner has failed to show
any customs fraud, the record establishes that neither Akzo Nobel Inc.
nor Akzo Nobel N.V. has reimbursed ANAPI for antidumping duty payments.
Akzo further contends that the CIT has affirmed the Department's
longstanding precedent that, absent evidence of reimbursement, the
Department has no authority to make the adjustment to U.S. price
requested by the petitioner. See Torrington at 632. Akzo states that,
according to the CIT, in Torrington, the party who requests the
reimbursement investigation must produce some link between the transfer
of funds and reimbursement of antidumping duties. Akzo argues that the
petitioner has failed to meet this burden by failing to establish any
agreement for reimbursement of antidumping duties between either Akzo
Nobel Inc. or Akzo Nobel N.V. and ANAPI .
Furthermore, Akzo argues that petitioner's reliance on Hoogovens is
misplaced. Akzo states that the Court remanded this decision to the
Department to provide a clearer basis for its determination that
reimbursement occurred. However, Akzo argues, even if the CIT
ultimately agrees that Hoogovens reimbursed its importer of record, the
facts of that case are distinguishable from the facts in Akzo's case.
In Hoogovens, the Department found that the importer and exporter had
entered into a written agreement to reimburse antidumping duties, which
triggered the application of section 353.26 of the Department's
regulations. See Certain Cold-Rolled Carbon Steel Plat Products from
the Netherlands, 61 FR 48465 (1996) (First Cold-Rolled Review) (the
review that led to the Hoogovens' CIT appeal). Akzo insists that there
is no such agreement between Akzo Nobel N.V. and its U.S. subsidiaries,
or between Aramid and ANAPI and, therefore, the decision in First Cold-
Rolled Review has no bearing on this case. Thus, the requirements of
section 353.26(a) do not apply and the Department should deny the
requested adjustment to Akzo's U.S. price.
Akzo further argues that no adjustments to the reported U.S. ISE is
warranted as there were no improper exclusions. Akzo claims that
petitioner argues without any citations that the Department should
artificially inflate Akzo's U.S. ISE to account for the financing
expenses incurred in connection with the antidumping duty deposits it
has made. Akzo argues that the Department's practice and precedent
actually support a downward adjustment of ISE to account for these
expenses. See Antifriction Bearings and Parts Thereof from France (AFBs
III), 58 FR 39729 (1993) opinion after remand, Federal-Mogul Corp. v.
United States, Slip Op. 96-193 at 2, 8 (CIT Dec. 12, 1996) (Federal
Mogul II). Akzo states that the Department has justified the adjustment
as analogous to the payment of legal fees in antidumping proceedings,
which are incurred solely because of the antidumping duty order and
thus are not selling expenses. Akzo further argues that, in Tapered
Roller Bearings from Japan, 62 FR 11825, 11829 (1997), the Department
cautioned that failure to allow a downward adjustment would risk
calculating overstated margins due to failure to take into account the
fact that no such expense would have been incurred absent the order.
Therefore, Akzo argues that the Department should not make an upward
adjustment to Akzo's U.S. ISE because it is not an expense incurred in
selling the subject merchandise.
Department's Position: We agree with Akzo. The Department's
regulations require the Department to deduct from U.S. price the amount
of any antidumping duty which the producer or reseller (i) paid
directly on behalf of the importer or (ii) reimbursed to the importer.
See 19 CFR 353.26 (a)(1996). Absent evidence of reimbursement, the
Department has no authority to make the adjustment to U.S. price.
Torrington at 632, citing Brass Sheet and Strip From Sweden, 57 FR
2706, 2708 (1992) and Brass Sheet and Strip From the Republic of Korea,
54 FR 33257, 33258 (1989). See also, Color Television Receivers from
the Republic of Korea; Final Results of Antidumping Duty Administrative
Reviews, 61 FR 4408, 4411 (1996). In the absence of actual
reimbursement payments, the Department requires evidence of a concrete
link between the financial transaction and the antidumping duty before
it may find reimbursement and impose additional duties. Torrington at
632, aff'd 127 F.3d 1077, 1080-81 (Fed. Cir. 1997) (further, the Court
of Appeals for the Federal Circuit upheld the Department's
interpretation and application of section 353.26. Id.) Finally, section
353.26 (b) of the Department's regulations also requires that the
importer file a certificate with the U.S. Customs Service, attesting to
the absence of any ``agreement or understanding for the payment or for
the refunding'' of the antidumping duties. See 19 CFR 353.26(b).
In the previous second administrative review, the Department
concluded that there was no evidence of reimbursement of ANAPI by Akzo
for antidumping duties and, therefore, there was no justification for
adjusting U.S. ISE for the potentially reimbursed antidumping duty
deposits. See Final Results of Antidumping Duty Administrative Review:
Aramid Fiber Formed of Poly Para-Phenylene Terephthalamide From the
Netherlands, 62 FR at 38061. During the course of conducting the
instant review, the Department provided petitioner with the opportunity
to comment upon all the information and data presented by the
respondent. However, petitioner did not allege any specific instance or
evidence of reimbursement of antidumping duties in either its October
17, 1997, or December 12, 1997, comments. Petitioner's first allegation
of reimbursement was presented in its administrative case brief, dated
April 8, 1998, after the Department completed verification and issued
its preliminary results of the administrative review. In its case
brief, the petitioner failed to provide any new, specific evidence
supporting its reimbursement allegations. Petitioner's comments on this
issue are speculative and do not point to concrete evidence of
reimbursement. Mere allegations of reimbursement are insufficient to
warrant further action by the Department. Neither section 353.26 nor
past precedent provide authority for the Department to undertake
further action or make additional adjustments based upon petitioner's
thinly supported assertions of reimbursement. Moreover, we carefully
reviewed the record and found no evidence on the record suggesting
reimbursement of antidumping duties, nor did we find specific evidence
of inappropriate financial intermingling between ANAPI and Akzo Nobel
Inc. or Akzo Nobel N.V. In reviewing the financial statements and
payment records of the U.S.
[[Page 37519]]
subsidiary, we verified that ANAPI is responsible for all cash deposits
and duties assessed. See Verification Report, dated February 24, 1998.
Further, petitioner's reliance on Hoogovens is inapposite. In that
case, the CIT held that, although the record evidence in Hoogovens
``suggested'' reimbursement of antidumping duties, the Department did
not identify which evidence supported its findings of reimbursement.
Thus, the CIT remanded this case to the Department for a reasoned
articulation of its decision. In the present case, however, we lack any
evidence of reimbursement.
Finally, there is evidence on the record that ANAPI filed the
required certifications with U.S. Customs Service attesting to the
absence of any agreement with the manufacturer, producer, seller, or
exporter for the payment or reimbursement of antidumping duties. Based
on these facts, the Department presumes the continued existence of the
circumstances that gave rise to our findings in the second
administrative review and that 19 CFR 353.26 is inapplicable in this
case. Therefore, consistent with our findings in the second
administrative review, we have not deducted any amount for reimbursed
duties from Akzo's U.S. price or included them in Akzo's U.S. ISE.
Comment 3: Petitioner argues that the Department inconsistently
filled in missing values for imputed credit expense for home market and
U.S. sales. Specifically, for home market sales, the Department filled
in the missing payment dates with the date of the preliminary
determination, March 2, 1998, and then calculated the missing credit
expense value, while for the U.S. sales, the Department calculated the
average credit expense for U.S. sales and then applied that average
expense to missing credit values. Petitioner claims that this
inconsistent application maximized the credit expense deduction for
home market sales, thereby reducing normal value, and artificially
reduced the credit expense deduction for U.S. sales, thereby increasing
the U.S. price. Because Akzo failed to submit a complete questionnaire
response, petitioner further argues that the Department should apply
adverse inferences and fill in the missing data with the largest value
on the record for the U.S. price deduction and with zero for the
corresponding home market price deduction, or at least fill in the
missing data with values that do not allow Akzo to benefit from its
omissions.
Akzo argues that the Department should reject petitioner's request
as contrary to current Department practice, which is to use the last
day of verification as the payment date for unpaid sales (February 2,
1998). Respondent cites Static Random Access Memory Semiconductors from
Taiwan, 63 FR 8909, 8928 (1998), as precedent.
Department's Position: In accordance with the Department's current
practice, the last day of verification will be used as the date of
payment for unpaid sales. See Extruded Rubber Thread From Malaysia;
Final Results of Antidumping Duty Administrative Review, 63 FR 12752,
12757 (1998) (citing Static Random Access Memory Semiconductors from
Taiwan; Final Results of Less than Fair Value Investigation, 63 FR
8909, 8928 (1998) and Brass Sheet and Strip from Sweden; Final Results
of Antidumping Administrative Review, 60 FR 3617, 3621 (1995)). We
disagree with petitioner's assertion that the Department should use an
adverse inference in calculating the imputed credit expense. In the
instant review, respondent has not impeded the review by providing
inaccurate or unverifiable data, instead it has provided data which was
successfully verified. Therefore, we have used the last day of
verification, February 2, 1998, as the date of payment for the
transactions in question.
The Department agrees with petitioner that we inconsistently
calculated missing credit expenses in the home sales market and U.S.
market during the preliminary determination. In the final results of
the review, the Department has substituted the missing payment dates
with the last day of verification and calculated the missing credit
expense value for both home market sales and U.S. sales. See
Calculation Memorandum, dated July 7, 1998, for a complete discussion
of the mathematical calculation.
Comment 4: Petitioner contends that the Department's treatment of
Akzo's goodwill expenses in the first and second administrative reviews
is not supported by substantial evidence on the record and is contrary
to law. Petitioner argues that the Department should amortize these
costs over a period that covers the POR to avoid improperly
understating the actual cost of producing PPD-T aramid fiber during the
POR.
Akzo argues that petitioner's position is unsubstantiated and
contrary to law. Akzo notes that the proper treatment of the goodwill
was the focus of the first administrative review, and of the recently
issued CIT decision. Respondent further notes that the Department spent
a significant amount of time gathering and analyzing all aspects of the
purchase. See Aramid Fiber Formed of Poly Para-Phenylene
Terephthalamide from the Netherlands, 61 FR 51406. Akso cites the CIT's
ruling to affirm the Department's treatment of goodwill as further
support for its contentions. Respondent cites specifically to the CIT's
approval of the Department's analysis, affirming that it was more
appropriate to isolate those components of goodwill that pertained to
assets used in the production of subject merchandise. Akzo states that
in preparing the questionnaire response for this review, it complied
with the Department's determination in the first two administrative
reviews. Finally, Respondent contends that no circumstances exist
warranting any deviation from the Department's prior approach, as
affirmed by the CIT.
Department's Position: The Department agrees with Akzo. As
explained at length in the final results of the first and second
administrative reviews, and affirmed by the CIT in E.I. DuPont, the
Department determined to accept Akzo's accounting method for the
amortization of goodwill expense as reasonable. See Aramid Fiber Formed
of Poly-Phenylene Terephthalamide from the Netherlands: Final Results
of Antidumping Administrative Review, 61 FR at 51406; Aramid Fiber
Formed of Poly-Phenylene Terephthalamide from the Netherlands: Final
Results of Antidumping Administrative Review, 62 FR at 38063.
The Department spent a significant amount of time gathering and
analyzing all aspects of the facts surrounding the goodwill issue
during the first administrative review. Upon completion of its
analysis, the Department determined that, for cost calculation
purposes, it was appropriate to isolate those components of goodwill
that pertained to assets used in the production of subject merchandise.
See Aramid Fiber Formed of Poly Para-Phenylene Terephthalamide from the
Netherlands, 61 FR at 51406. The Department verified that Akzo complied
with the Department's decision in the first administrative review, and
calculated the reported depreciation expenses exclusive of goodwill
expenses in preparing its response for the instant review. The
methodology used in the instant case is consistent with the final
results of the first and second administrative reviews.
Moreover, in E.I. DuPont, the CIT rejected petitioner's arguments
with respect to goodwill, affirming the Department's treatment of
inventory write-downs and residual goodwill
[[Page 37520]]
expenses. See E.I. DuPont at 15-24. Therefore, for purposes of the
instant review, the Department will continue to use Akzo's reported
cost of production and constructed value data in calculating the
antidumping duty margin.
Comment 5: Akzo claims that the computer program used in
calculating the preliminary results contained three errors that must be
corrected. First, Akzo argues that the difference in merchandise
(DIFMER) adjustment was miscalculated by failing to convert the
submitted variable cost of manufacturing of the U.S. product (VCOMU)
from kilograms to pounds. Akzo explains that because the U.S. sales are
reported on a per pound basis and the analysis is conducted on the same
basis, it is necessary to convert the DIFMER adjustment to a per pound
amount. Second, Akzo claims that in calculating the net constructed
export price (CEP), the Department correctly added U.S. packing costs
to normal value but incorrectly included U.S. packing costs as an
adjustment to the gross price, thereby understating the net CEP and
overstating the margin. Third, Akzo argues that the Department
incorrectly deducted the ISE incurred in the home market on U.S. sales
from CEP after correctly determining in the preliminary results and LOT
analysis memo that these expenses were not related to the economic
activity in the U.S. Akzo provided suggested changes to correct the
alleged errors.
Petitioner did not rebut any of Akzo's aforementioned suggested
corrections.
Department's Position: The Department agrees with Akzo and has
revised the final margin program to reflect these changes. First, the
Department has converted VCOMU from kilograms to pounds to ensure that
the final margin analysis is performed on a comparable basis. Second,
the Department has corrected the margin program to ensure that both the
CEP and NV are calculated inclusive of packing costs. Finally, the
Department's preliminary margin calculation program inadvertently
included ISE that were not incurred in connection with economic
activity as deductions to the U.S. selling price. The Department's
analysis in the Level of Trade Memo, dated March 2, 1998, is correct in
stating that only those expenses incurred connection with economic
activity in the U.S. will be deducted from CEP in conducting the margin
analysis. For purposes of these final results of review, the Department
has revised the margin calculation to reflect the conclusion of the
Level of Trade Analysis memo. For further explanation, see Calculation
Memorandum, dated July 7, 1998.
Final Results of Review
As a result of our review, we determine that the following
weighted-average margin exists:
------------------------------------------------------------------------
Margin
Manufacturer/exporter Period of review (percent)
------------------------------------------------------------------------
Akzo.................................... 6/1/96-5/31/97 6.31
All Other............................... 6/1/96-5/31/97 66.92
------------------------------------------------------------------------
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. For assessment purposes, we have calculated importer
specific duty assessment rates for the merchandise based on the ratio
of the total amount of antidumping duties calculated for the examined
sales during the POR to the total entered value of sales examined
during the POR.
Furthermore, the following deposit requirements will be effective
upon publication of this notice of final results of review for all
shipments of PPD-T aramid fiber from the Netherlands entered, or
withdrawn from warehouse, for consumption on or after the publication
date, as provided by section 751(a)(1) of the Act: (1) The cash deposit
rate for the reviewed company will be the rate listed above; (2) if the
exporter is not a firm covered in this review, a prior review, or the
original 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 (3) for all other producers and/or
exporters of this merchandise, the cash deposit rate shall be 66.92
percent, the ``all others'' rate established in the LTFV investigation
(59 FR 32678, June 24, 1994). These deposit requirements 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 351.402(f) 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.
Notification to Interested Parties
This notice also serves as a 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 353.305 and 19 CFR 353.306. 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 an APO is a sanctionable
violation.
This administrative review and notice are in accordance with
section 751(a)(1) of the Act (19 U.S.C. 1675(a)(1)) and 19 CFR 351.221.
Dated: July 7, 1998.
Richard W. Moreland,
Acting Assistant Secretary for Import Administration.
[FR Doc. 98-18596 Filed 7-10-98; 8:45 am]
BILLING CODE 3510-DS-P
