[Federal Register Volume 59, Number 160 (Friday, August 19, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-20455]
[[Page Unknown]]
[Federal Register: August 19, 1994]
-----------------------------------------------------------------------
DEPARTMENT OF COMMERCE
[A-351-806]
Silicon Metal From Brazil; Final Results of Antidumping Duty
Administrative Review
AGENCY: International Trade Administration/Import Administration,
Commerce.
ACTION: Notice of final results of antidumping duty administrative
review.
-----------------------------------------------------------------------
SUMMARY: On August 5, 1993, the Department of Commerce published the
preliminary results of its administrative review of the antidumping
duty order on silicon metal from Brazil. The review period is March 29,
1991 through June 30, 1992. The review covers four manufacturers/
exporters.
We gave interested parties an opportunity to comment on the
preliminary results. Based on our analysis of the comments received, we
have changed our results from those presented in our preliminary
results as described below in the comments section of this notice.
EFFECTIVE DATE: August 19, 1994.
FOR FURTHER INFORMATION CONTACT: Michael Heaney, Office of Antidumping
Compliance, International Trade Administration, U.S. Department of
Commerce, Washington, D.C. 20230; telephone (202) 482-4475.
SUPPLEMENTARY INFORMATION:
Background
On August 5, 1993, the Department of Commerce (the Department)
published in the Federal Register (58 FR 41721) the preliminary results
of its administrative review of the antidumping duty order on silicon
metal from Brazil (July 12, 1991, 56 FR 36135). The Department has now
completed that administrative review in accordance with Section 751 of
the Tariff Act of 1930, as amended (the Tariff Act).
Scope of the Review
The merchandise covered by this review is silicon metal containing
at least 96.00 but less than 99.99 percent of silicon metal from
Brazil. Silicon metal is currently provided for under subheadings
2804.69.10 and 2804.69.50 of the Harmonized Tariff Schedule (HTS) as a
chemical product, but is commonly referred to as a metal. Semiconductor
grade silicon metal (silicon metal containing by weight not less than
99.99 percent of silicon and provided for in subheading 2804.61.00 of
the HTS) is not subject to the order. HTS item numbers are provided for
convenience and Customs purposes. The written description remains
dispositive.
On February 3, 1993 the Department determined, pursuant to 19 CFR
353.29 (1993), that silicon metal with a higher aluminum content
containing between 89 and 96 percent of silicon metal is of the same
class or kind of merchandise as silicon metal subject to the
antidumping duty order. While this scope determination was undertaken
in the context of the antidumping duty order governing silicon metal
from the People's Republic of China, the silicon metal subject to that
order is the same as the silicon metal covered by this order.
Therefore, the Department will include such merchandise in future
reviews of this order.
This review covers four manufacturers/exporters of Brazilian
silicon metal. The period covered by this review is March 29, 1991
through June 30, 1992.
Analysis of Comments Received
We gave interested parties an opportunity to comment on the
preliminary results as provided by section 353.22(c) of the
Department's regulations. We received comments from the petitioners
(American Alloys, Inc., Elkham Metals Company, Globe Metallurgical
Inc., SKW Metals & Alloys, Inc. and SMI Group, Inc., Rock Island
Silicon Division) and from four respondents (Companhia Brasileira
Carbureto de Calcio (CBCC), Companhia Ferroligas Minas Gerais-
Minasligas (Minasligas), Eletrosilex Belo Horizonte (Eletrosilex), and
Rima Eletrometalurgia S.A. (Rima)). On January 14, 1994, we held a
public hearing.
Comment 1: Petitioners contend that CBCC refused to provide cost
information necessary for the calculation of cost of production (COP)
and constructed value (CV). Specifically, petitioners argue that CBCC
did not properly report its interest expenses and charcoal replacement
costs. Petitioners also contend that CBCC understated its electricity
and quartz replacement costs. Petitioners conclude that the Department
should utilize the highest, most adverse margin as best information
available (BIA) since the deficiencies in CBCC's COP/CV response are so
pervasive.
Department's Position: We disagree with petitioners. While during
verification we did find areas where the costs were not appropriately
quantified, we have not found these deficiencies to be so significant
or pervasive as to call into question the accuracy of the entire
response. It should be noted that some of the issues, as discussed in
comments 2, 4, 6, and 11, are related to methodological questions,
rather than areas of incorrect reporting of costs. In the instances
where we found insufficient verification support (see December 20, 1993
``CBCC Cost Verification Report''), we relied on partial BIA. For the
methodological issues, we recalculated the costs to correct a
particular cost element. Although we have made certain adjustments to
the information submitted by CBCC (see e.g., our responses to comments
2, 4, 5, 6, 7, and 9), we generally have used CBCC's data in reaching
these final results of administrative review.
Comment 2: Petitioners note that Solvay do Brasil owns 99.8 percent
of CBCC. Petitioners contend that if the Department uses the COP/CV
information submitted by CBCC, it should base its calculation of
interest expense upon the borrowing experience associated with the
consolidated group of companies. Petitioners contend that the
Department should use the financial expenses reported on Solvay do
Brasil's financial statements to perform this calculation. Finally,
petitioners assert that the Department should apply this allocation to
the replacement cost of manufacture (COM) to properly account for
Brazilian hyperinflation.
CBCC argues that calculation of interest expense on a consolidated
basis would be improper. CBCC contends that the December 20, 1993,
verification report concludes that CBCC made interest-free loans to
Solvay do Brasil. CBCC contends that it charged Solvay do Brasil the
minimum Brazilian statutory requirement for the monetary correction.
CBCC also argues that the Department found no evidence of loans from
Solvay do Brasil to CBCC at verification.
Department's Position: We agree with petitioners that CBCC's
interest expense should be calculated on a consolidated basis. Since
the cost of capital is fungible, we believe that calculating interest
expense based on consolidated statements is the most appropriate
methodology (see, e.g., Final Determination of Sales at Less Than Fair
Value, Small Business Telephones from Korea, 54 FR 53141, 53149
(December 27, 1989), Final Results of Antidumping Duty Administrative
Review, Brass Sheet and Strip from Canada, 55 FR 31414, 31418-31419
(August 2, 1990), and Final Determination of Sales at Less Than Fair
Value, Antifriction Bearings (Other than Tapered Roller Bearings) and
Parts Thereof from the Federal Republic of Germany, et al., 54 FR
18992, 19074 (May 3, 1989)).
In order to extinguish its outstanding debt, CBCC issued new shares
of capital stock to its parent company. Also, we established at
verification that Solvay do Brasil owns 99.8 percent of CBCC. Based on
these facts, it is evident that the shift in debt is due to the parent
company's control over the subsidiary. Accordingly, the degree of
relationship influenced the structure of debt for the entire company.
Therefore, consistent with our normal practice, we revised CBCC's
submitted interest expenses based on the consolidated financial
statements of Solvay do Brasil.
During verification, CBCC company officials did not provide the
source documents for Solvay's financial income and expenses. Therefore,
we have used BIA to determine CBCC's financial expenses. As BIA, we
used information from Solvay do Brasil's financial statements. This
percentage was then applied to each month's COM to ensure that CBCC's
COP data fully reflected interest expenses.
Comment 3: Petitioners contend that the Department's December 20,
1993, COP verification report suggested allocating interest expenses to
CBCC's COP based on the sum of the financial expenses reflected in
CBCC's and Solvay do Brasil's 1991 and 1992 financial statements.
Petitioners note that if the Department took that approach, it would
determine interest expenses as a percentage of the sum of both
companies' cost of goods sold (COGS), adjusted for intercompany
interest transactions. Petitioners further contend that CBCC's
financial statements reflect only net interest expenses, and that use
of the allocation that the Department proposed in its December 20,
1993, verification report would give CBCC credit for all of its
interest income, whether short-term or not. Petitioners argue that CBCC
submitted no information regarding short-term interest income, making
it impossible for the Department to make any adjustment for
intercompany interest transactions.
Department's Position: We agree with petitioners that CBCC did not
provide information documenting the company's short-term interest
income. As previously discussed in our response to Comment 2, we have
relied upon BIA in our calculation of CBCC's interest expense. As BIA,
we used the financial expense information from Solvay do Brasil's
financial statements. We then applied this percentage to each month's
COM for purposes of our COP/CV calculations.
Comment 4: Petitioners assert that CBCC purchased electricity at a
discount when the electricity is used to restart idled machinery.
Petitioners note that, prior to March 1992, CBCC averaged the cost of
electricity obtained from its own production and from three separate
pricing plans. Petitioners note that, after March 1992, CBCC stopped
averaging electricity costs, and used the discounted electricity
associated with the running of idled machines. Petitioners contend that
the Department should use CBCC's average electricity costs in the COP/
CV calculations rather than the discounted electricity costs associated
with the restarting of idled machinery.
CBCC contends that the antidumping law contemplates that producers
will base pricing decisions on currently available COP information.
CBCC contends that the Department verified that the furnace was idle
prior to the acquisition of the discounted energy, and that the
discounted energy was only used on the restarted furnace. CBCC argues
that it applied the discounted energy to silicon metal so as to
minimize the COP of silicon metal consistent with the Department's COP
methodology. CBCC suggests that averaging its electricity costs would
result in rejection of its cost data simply because the cost is not
high enough.
Department's Position: In reaching these final results we have
relied upon our general practice in a hyperinflationary economy which
is to calculate a monthly average cost for each input. The Department
believes that it is inappropriate to specifically identify inputs
obtained at a lower cost to a particular product or production run. The
furnaces used to produce silicon metal can produce other products that
are not subject to review. Likewise, other furnaces used to produce
non-subject merchandise can be used to produce silicon metal.
Accordingly, any benefits derived from the use of a particular furnace
relate to all products produced during the period of review.
We note that in this case it is strictly a management decision as
to which product will be made in the furnace which is receiving the
less expensive input. As such, in months in which there were U.S.
shipments of silicon metal, the furnace which utilizes less expensive
electricity can be assigned to produce silicon metal. That same furnace
could be assigned to produce ferrosilicon in months in which CBCC had
U.S. sales of ferrosilicon, a product which is also subject to an
antidumping duty order. In fact, during the period covered by this
review, the furnace in question did produce both silicon metal and
ferrosilicon. (Both silicon metal and ferrosilicon were also produced
in other furnaces.)
The facts of the instant case are consistent with the Department's
position requiring the weight-averaging of the costs of merchandise
produced in more than one facility. The Department has consistently
held that it is inappropriate to make adjustments for cost differences
between facilities when the merchandise produced in each is identical
(see Department of Commerce Policy Bulletin No. 92.2, July 29, 1992,
which is on file at the Central Records Unit).
Comment 5: Petitioners contend that the Department verified that on
several occasions CBCC paid an advance deposit on its electricity bill.
Petitioners further contend that the Department should make an upward
adjustment to CBCC's reported electricity costs to account for the
effect of Brazilian inflation.
CBCC argues that it received a credit from CEMIG (its energy
supplier) for advance payment. CBCC asserts that the Department should
deduct the amount of the credit from the invoiced amount since that
represents the real ``cost'' of the item.
Department's Position: In calculating the replacement cost of
electricity obtained in each month of the period of review we used the
invoiced price for that month. We did not reduce the invoiced amount
for the effect of any ``credits'' CBCC may have obtained. Such a
reduction would not properly reflect the replacement cost of
electricity. Although this is a short-term monetary asset which is not
subject to the balance sheet monetary corrections, through agreement,
CEMIG credits CBCC for the value of cruzeiros as of the invoice date.
This does not reduce the replacement cost of electricity CBCC obtained
but merely reduces the nominal cruzeiro amount outstanding. Under the
Department's replacement cost methodology each month's cost is measured
in the monthly nominal invoiced cruzeiro amounts. Therefore, we have
accepted the amounts billed by CEMIG as each month's replacement cost,
without the effect of the ``credit.''
Comment 6: Petitioners note that CBCC reported electricity costs
exclusive of the ICMS tax in its calculation of third-country COP.
Petitioners contend that these tax payments should have been included
in CBCC's calculation of electricity costs.
Department's Position: We agree with petitioner. When using third-
country sales as the basis of FMV, we must determine if the
manufacturer incurred costs which resulted from the payment of taxes on
the purchase of inputs. In this review period, CBCC incurred ICMS tax,
a value added tax (``VAT''), in purchasing electricity. CBCC is able to
offset some of this tax when it sells products in the home market
because it charges and receives a VAT on its home market sales. In this
case, even though the home market was not viable, CBCC did make some
home market sales. However, there were not enough home market sales for
the VAT charged and received on those sales to offset all of the VAT it
paid on the electricity purchased to produce the merchandise sold in
the third country. Accordingly, this resulted in a net cost to CBCC for
the ICMS taxes paid in the production of silicon metal sold for export.
As such, the Department included the net amount of the ICMS VAT in the
submitted COP and CV amounts.
This approach differs from that used in the Department's remand
determination concerning the underlying investigation. In that
determination, we made an allowance for an offset to the ICMS VAT paid
currently for potential VAT to be received on future home market sales.
Under this approach the ICMS was, in effect, excluded from the
calculation of constructed value. We have subsequently reconsidered
this methodology and have concluded that allowing such an offset for
potential, future sales results in an adjustment that we now consider
to be purely speculative. Accordingly, we will include in CV ICMS on
inputs that are not offset by VAT charged and collected on actual home
market sales which occur during the period of review. We believe our
current approach better reflects the economic reality of the costs
incurred during the period of review (i.e. current costs are not tied
to potential future events). Our approach in this case is consistent
with the Final Determination of Sales at Less Than Fair Value,
Ferrosilicon from Brazil, 59 FR 732, 737 (January 6, 1994). We believe
this approach also is in accordance with the court's remand
instructions on this issue in Camargo Correa Metais, S.A. v. United
States, Slip. Op. 93-163 (CIT August 12, 1993).
Comment 7: Petitioners contend that CBCC made no provision in its
calculation of charcoal costs for the effects of inflation when CBCC
harvested an area. Petitioners note that the Department requested
additional documentation from CBCC at verification regarding CBCC's
estimates of charcoal harvest and the other assumptions CBCC built into
its calculation of charcoal cost. Petitioners contend that, because
CBCC failed to provide information, the Department should apply BIA.
Petitioners argue that use of BIA is appropriate when a respondent
refuses to submit information after being asked to do so, and where the
refusal to provide the requested information impedes the Department's
proceeding.
Petitioners contend that CBCC's failure to provide the appropriate
information justifies the use of noncooperative BIA for CBCC. Finally,
if the Department determines not to use noncooperative BIA for CBCC,
petitioners suggest that the Department adjust CBCC's reported cost for
company-produced charcoal upward to an amount equal to that charged to
CBCC from unrelated suppliers.
Department's Position: We agree with petitioners that we should
adjust CBCC's charcoal replacement costs. However, we disagree that
CBCC was noncooperative and should receive a margin based solely upon
BIA. We discovered errors made by CBCC when it calculated its cost of
producing charcoal, a primary raw material used in the production of
silicon metal. For purposes of calculating replacement costs, CBCC
substantially understated its cost of producing charcoal by
inaccurately recording the costs associated with its forests which
provide the raw material needed to produce charcoal. We note, however,
that CBCC reported cost information consistent with that which is
maintained in its normal cost accounting system. Therefore, we have
recalculated the cost of CBCC's production of charcoal. We relied upon
the actual weighted-average monthly cost CBCC was charged by unrelated
vendors.
Comment 8: Petitioners argue that the Department should revise
CBCC's reported 1992 quartz replacement costs upward to account for the
more costly delivery charges the Department discovered at verification.
Department's Position: At verification we noted that CBCC changed
procedures for quartz purchasing in 1992. Because we found that CBCC's
reported quartz replacement costs for 1992 did not reflect the entire
cost of the material, we randomly chose May 1992 as a sample to
determine the amount of the discrepancy. In establishing the amount of
the discrepancy, we valued all quartz purchases received in May at the
delivered price in effect for the region of origin. This reconciliation
indicated that CBCC's estimate of delivery charges for this month
understated the per ton cost for quartz by approximately four percent.
Because CBCC did not fully report its quartz replacement costs, we have
applied partial BIA for this material. As BIA, we have adjusted upward
the reported quartz prices reported for January through May 1992 by
four percent.
Comment 9: Petitioners contend that CBCC's calculation of inventory
holding gains/losses is flawed. Petitioners note that there is a large
difference between the amount of silicon metal produced by CBCC and the
amount of silicon metal sold by CBCC. Petitioners also object to the
limited data provided by CBCC for electrode paste and charcoal and
argue that CBCC's inclusion of a large year-end depreciation charge in
December 1991 resulted in significantly understated COPs for all but
one month of the review period.
Petitioners assert that, by using sales and production data
provided by CBCC, petitioners have derived a corrected inventory
holding gain/loss calculation for CBCC. Petitioners contend that the
Department should use petitioners' revised calculation of CBCC's
inventory holding gains/losses in the final results.
Department's Position: We have reviewed CBCC's calculation of
inventory holding gains/losses (see CBCC's February 24, 1993 submission
at Exhibit A) and have found certain inconsistencies which render that
calculation unacceptable. For certain months CBCC reported sales and
shipments of silicon metal but showed no removal of silicon metal from
inventory. In other months, the tonnage of silicon metal removed from
inventory was either much less or much greater than the amount of
merchandise that CBCC reported in its sales listings.
Moreover, we find that petitioners' ``corrected'' calculation of
CBCC's inventory gains/losses is also unacceptable since it fails to
account for finished silicon metal consumed in the production of other
products. Accordingly, we have rejected both CBCC's and petitioners'
calculation of inventory gains/losses, and have removed this item from
our COP/CV calculations, which has the effect of increasing COP/CV.
Comment 10: Petitioners argue that the Department should make an
addition to CBCC's COP to account for certain costs (power, secondary
materials and crushing costs) which CBCC omitted from CBCC's revised
COP/CV calculation. Petitioners note that these expenses were included
in CBCC's original COP/CV response.
CBCC contends that power, secondary materials and crushing costs
were included in its revised response under the variable ``VARCOM.''
CBCC argues that it summarized these three costs in order to comply
with the Department's reporting requirements.
Department's Position: Although the power, secondary materials and
crushing costs were not detailed in CBCC's revised COP/CV calculations,
the total reported costs furnished by CBCC (variables ``TOTCOP'' and
``TOTCV'') did include these expenses. CBCC did omit these items from
the variables representing variable overhead, fixed overhead, and total
variable cost of manufacturing, i.e., variables ``VARFOH'', ``FIXFOH'',
and ``TOTCOM''. However, since CBCC included these expenses in its
calculation of total COM, no adjustment to CBCC's reported COP or CV is
required.
Comment 11: Petitioners contend the Department should reject
CBCC's allocation of general and administrative (G&A) and selling
expenses. (CBCC allocated these expenses to individual products using
the ratio of each product's cost of goods sold (COGS).) Petitioners
contend that the Department should follow its established practice and
allocate these expenses to total COGS, as the Department did in the
preliminary results of this review.
CBCC suggests that the allocation of G&A and selling expenses used
in the Department's preliminary calculations results in a systematic
overstatement of these expenses. CBCC argues that the Department should
allocate the ratio of G&A and selling expenses by the historical ratio
of these expenses to historical COM. CBCC notes that the Department
followed this methodology in the redetermination of the original
investigation for this proceeding (see Silicon Metal from Brazil:
Preliminary Determination on Remand, (November 17, 1993, at 5).
Department's Position: G&A expenses are period expenses which are
normally measured over a fiscal year. As such, the Department
calculated G&A on an annual historical basis. In order to avoid
overstating G&A expenses and to neutralize hyperinflationary effects,
we applied the G&A ratio (i.e., the ratio of annual G&A expenses to
cost of goods sold reflected in the financial statements) to each
month's COM calculated on a historical basis. In addition, CBCC had
failed to include Solvay do Brasil's G&A expenses. Therefore, we
applied a portion of Solvay do Brasil's G&A in the final calculation of
these costs (see CBCC Calculation Adjustment Memorandum, February 2,
1994). This is consistent with the method we used to calculate G&A
expenses in the remand determination in the underlying investigation.
Comment 12: Petitioners contend that the Department should include
ICMS and IPI taxes in the calculation of CBCC's raw material costs.
Petitioners contend that these taxes are included on home market sales,
and must, therefore, be included in the COP of home market merchandise.
Department's Position: Petitioners' argument that ICMS and IPI
taxes are included on home market sales is not relevant since CBCC's
home market sales were insufficient to form a basis for FMV and,
therefore, FMV was based upon third country sales. However, we agree
that, since the ICMS and IPI taxes resulted in a net cost to CBCC, the
Department should include this net amount of ICMS and IPI in the
submitted COP and CV amounts. Our reasoning for doing so is discussed
further in our response to comment 6, which involved a similar
situation.
Comment 13: Petitioners argue that the Department failed to include
CBCC's and Minasligas's imputed credit expenses in the preliminary CV
calculations. Petitioners argue that the Department should make an
adjustment for imputed credit in the final calculations.
Department's Position: We agree with petitioners. In these final
results we have included CBCC's and Minasligas's imputed credit costs
in our calculation of CV. We based this adjustment on the credit
expenses that these companies incurred on home market or third-country
sales.
Comment 14: Petitioners contend that the Department should use the
quartz replacement costs reported by Minasligas in its original COP/CV
response rather than the costs reported in Minasligas's revised
response of November 9, 1993. Minasligas provided average quartz
delivery charges in its revised COP/CV response. Petitioners note that
the Department's verification report indicates that averaging freight
charges significantly understates Minasligas's type A quartz costs.
Minasligas contends that, while the corrected cost data may result
in lower delivered prices for type A quartz, the revised data result in
significantly lower overall replacement costs for that material.
Minasligas indicates that it does not object to use of the quartz
replacement costs reported in its original COP/CV response, and notes
that the Department used these costs in the preliminary calculations.
Department's Position: We agree with petitioners. As discussed in
the cost verification report (December 17, 1993), the revised costs
calculated by Minasligas and filed with the Department on November 9,
1993 reflect a methodology which understates the delivered cost of type
A quartz, by allocating the delivery charges among all quartz
purchases. Accordingly, we have rejected the revised replacement cost
for quartz and relied upon the cost information Minasligas reported in
its original COP/CV response. As Minasligas notes, this is the
information we used in reaching the preliminary results of review.
Comment 15: Petitioners state that the Department determined at
verification that Minasligas did not include forest amortization costs
in its calculation of charcoal replacement costs. Petitioners argue
that omission of these expenses significantly understates the cost of
the charcoal which Minasligas produced. Petitioners contend that the
Department should use the costs associated with Minasligas's purchase
of charcoal from unrelated suppliers in the final calculation of
charcoal replacement costs.
Minasligas argues that the charcoal replacement costs it reported
in its original COP/CV response were exclusively based on the delivered
price charged to the company by suppliers cutting trees on land that
Minasligas did not own. Minasligas contends that it pays less for
charcoal cut from trees on its own land, and that its corrected
charcoal costs are significantly lower than those reported in its
original COP/CV response. Minasligas indicates that the Department
should use the charcoal replacement costs reported in its original COP/
CV response, if the Department decides not to use the corrected
charcoal replacement costs supplied by Minasligas.
Department's Position: We agree with petitioners. As discussed in
the cost verification report (December 17, 1993), the revised costs
calculated by Minasligas and filed with the Department on November 9,
1993 reflect a methodology which understates the replacement cost of
charcoal by averaging the payment to subcontractors for charcoal
obtained from company-owned land with the higher costs from unrelated
charcoal vendors. This calculation does not include any cost to
Minasligas for acquiring forests or planting and maintaining forests.
Accordingly, we have rejected the revised replacement cost for charcoal
and relied upon the cost information provided by Minasligas in its
original COP/CV response.
Comment 16: Petitioners contend that the Department found at
verification that Minasligas had not accurately accounted for loss
allowances for quartz and charcoal used in 1991 silicon metal
production. Petitioners contend that the Department should make an
upward adjustment to Minasligas's reported 1991 quartz and charcoal
costs to account for this expense. Petitioners suggest that the
Department use the loss allowances provided by Minasligas for 1992
silicon metal production to make this adjustment.
Minasligas contends that the question of whether quartz and
charcoal losses were understated prior to 1992 is irrelevant because
Minasligas had no U.S. sales during that time. Minasligas notes that it
did provide an acceptable calculation for charcoal and quartz losses
for 1992.
Department's Position: We agree with the petitioners that, prior to
1992, the measured consumption of charcoal and quartz into the furnace
was not consistently and scientifically adjusted to reflect losses
sustained between the time the material was delivered into the factory
stockyard and introduced into a furnace. Beginning in 1992, Minasligas
established a loss allowance and consistently applied it to both quartz
and charcoal. For 1991 quartz and charcoal, Minasligas estimated loss
allowances and recorded them on an occasional basis. We have
recalculated loss allowances for 1991 based upon BIA. As BIA, we have
used the loss allowance established by the company in 1992 and applied
this percentage to both quartz and charcoal consumption for all months
in 1991. We disagree with Minasligas's assertion that the 1991 costs
are irrelevant, since they are used to determine whether home market
sales were sold at or above their COP.
Comment 17: Petitioners contend that the Department should allocate
Minasligas's consumption of iron rods and tubes over all months of the
period of review, instead of accepting Minasligas's approach.
(Minasligas recognized the entire expense associated with these charges
in the month in which they were requisitioned out of inventory.)
Petitioners suggest that for those months for which Minasligas did not
report iron rods and tube costs, the Department should use the per-unit
output costs for rods and tubes from the most recent month with an
adjustment for inflation.
Minasligas contends that allocating the consumption of rods and
tubes over the period of review would only marginally change the cost
of materials for the month that Minasligas had a U.S. sale. Minasligas
contends that more rods were requisitioned during that month than were
consumed.
Department's Position: We agree with petitioners that it is more
accurate to allocate the number of rods and tubes removed from
inventory to production tons over the period in which they were
consumed, rather than just the month of requisition. Accordingly, we
have reallocated the total rods and tubes consumed during the period of
review equally to tons produced during this same time period. Each
month's allocated consumption quantity was then valued at the reported
replacement cost for that same month. We also agree with Minasligas
that this adjustment does not have a serious impact on the reported
cost information.
Comment 18: Petitioners assert that verification revealed that
Minasligas's supplier measures electricity from the fifth of one month
to the fifth of the following month. Petitioners further argue that
Minasligas used the invoice received from its supplier on approximately
the tenth of the month to represent the electricity costs for that
month. Petitioners contend that such a methodology understates the
replacement costs for electricity since it primarily reflects the costs
incurred during the previous month. Petitioners contend that for each
month of the review period the Department should use the electricity
costs reported by Minasligas for the following month.
Department's Position: We agree with the petitioners. Minasligas
reported the replacement cost of monthly electricity for the month in
which the bill was received. Each month's bill reflects the cost of
electricity purchased in the prior month. Therefore, the reported
replacement cost of electricity is understated since it lags the actual
cost by one month. We have corrected for this understatement by
matching each month's bill with the month that it covered.
Comment 19: Petitioners contend that Minasligas's allocation of G&A
expenses is incorrect. (Minasligas allocated monthly G&A expenses to
individual products based upon the number of furnaces used in the
production of each product.) Petitioners contend that the Department
should allocate G&A expenses to total COGS as was done in the
preliminary results.
Minasligas contends that a larger portion of its operation is
devoted to ferrosilicon than to silicon metal. Minasligas contends that
allocating G&A expenses to total COGS overstates the amount of G&A
expenses relating to silicon metal.
Department's Position: We agree with petitioners. G&A expenses are
period expenses which relate to the operation of the company as a whole
and are not customarily associated with a particular product or
process. Therefore, we recalculated G&A expenses on a company-wide
annual historical basis and, in order to avoid overstating G&A expenses
and to neutralize hyperinflationary effects, we applied the G&A ratio
to each month's COM calculated on a historical basis.
Comment 20: Petitioners contend that the Department should
calculate Minasligas's interest expense as the consolidated expenses of
Minasligas and Delp Engenharia S.A. (Delp). Petitioners note that Delp
controls over 93 percent of Minasligas's common stock and thus has a
controlling interest in Minasligas. Petitioners suggest that the
Department use Delp's 1991 and 1992 financial statements to perform
this calculation.
Minasligas contends that Delp and Minasligas are separate entities,
maintain separate financial statements, and have their own interest
expense and income. Therefore, Minasligas asserts that it would be
improper to calculate interest expense on a consolidated basis.
Department's Position: We agree with petitioners that Minasligas
should report interest expense on a consolidated basis. See our
response to comment 2.
In the case of Minasligas, Delp does not consolidate its accounts
with Minasligas. In addition, because there are no significant
intercompany transactions between the two companies, we combined the
financial expenses of the two companies and calculated an interest
expense as a ratio to cost of sales, effectively creating consolidated
accounts. The Department only allows income generated from investments
of working capital, which the company documents as short-term in
nature, to offset interest expense (see, e.g., Final Determination of
Sales at Less Than Fair Value, Cellular Mobile Telephones from Japan,
54 FR 45447, 45455 (October 31, 1985), and Final Determination of Sales
at Less Than Fair Value, Mechanical Transfer Presses from Japan, 55 FR
335, 342 (January 4, 1990)). Minasligas was able to substantiate only a
portion of the investments to be short-term; consequently, we have
allowed only the documented portion of interest income as an offset. We
did not allow an offset to Minasligas's parent, Delp, for interest
expense because the information required to substantiate such an
adjustment is not contained in the record of this review.
In order to avoid overstating financing charges, we applied the
interest expense ratio (i.e., the ratio of net interest expense to cost
of goods sold) to each month's COM calculated on a historical basis
rather than to amounts computed under the replacement cost basis. This
is consistent with the methodology used in the remand determination in
the underlying investigation.
Comment 21: Petitioners contend that Minasligas did not submit
information regarding short-term interest income at the consolidated,
parent company level. Accordingly, the petitioners contend that it is
not feasible to ``compute interest expense using the sum of
Minasligas's and Delp's financial expenses adjusted for intercompany
interest transactions'', as suggested by the Department's cost
verification report. Finally, petitioners assert that the Department
should apply this allocation to COM to properly account for Brazilian
hyperinflation.
Department's Position: We agree with petitioners that the record
does not contain information regarding short-term interest income at
Minasligas's parent company, Delp. Accordingly, we have not allowed any
such offset for Delp's interest income in our calculation of combined
interest expense. Consistent with our practice in the Final
Determination of Sales At Less Than Fair Value; Ferrosilicon from
Brazil, 59 FR 732, 736-737, January 6, 1994, we have applied the
calculated interest expense ratio to the monthly COMs calculated on a
historical basis rather than amounts computed under the replacement
cost basis.
Comment 22: Petitioners contend that Minasligas's calculation of
inventory holding gains/losses is flawed because Minasligas failed to
properly ``layer'' inventory according to the month that the
merchandise was placed in inventory. Petitioners contend that
Minasligas's calculation reflects one level of inventory even though
Minasligas held merchandise in inventory for at least two preceding
months. Petitioners contend that this flaw makes Minasligas's
calculation unusable. Accordingly, petitioners contend that the
Department should disregard Minasligas's calculation, and make no
adjustment for inventory holding gain or loss in the final COP
calculations.
Department's Position: We agree with petitioners. Minasligas's
calculation of inventory holding gains/losses did not account for
merchandise that spent multiple months in inventory. Accordingly, we
have rejected Minasligas's claimed inventory holding gain.
Comment 23: Petitioners contend that the Department should disallow
the portion of Minasligas's duty drawback claim pertaining to IPI and
ICMS taxes. Petitioners contend that these expenses are taxes, not
duties. Petitioners also note that these two taxes were not listed in
the duty drawback regulations provided by Minasligas.
Department's Position: We disagree with petitioners. Article 314 of
the Brazilian Customs Regulations provides for the ``suspension of
payments of tributes due when importing merchandise to be exported * *
*.'' (Emphasis added.) The suspension is not limited to customs duties.
It includes all ``tributes'' paid upon importation of the merchandise.
IPI and ICMS taxes incurred on imported electrodes are two such
tributes which are suspended upon exportation of the merchandise. Thus,
Minasligas correctly included these expenses in its claimed adjustment
for duty drawback.
Comment 24: Petitioners contend that the Department should use
adverse, noncooperative BIA for RIMA. Petitioners make reference to the
Department's December 22, 1993 verification report regarding RIMA's
COP/CV response. That report indicated that RIMA: (1) Was unwilling to
supply the Department with necessary worksheets, schedules, or source
documents, (2) that the aspect of RIMA's COP/CV response pertaining to
related party transactions, G&A expenses, finance costs, and profit
were not verified, (3) that RIMA's calculation of charcoal and quartz
costs were not reflective of monthly replacement costs, and (4) that
RIMA did not adjust the value of its electrode purchases to account for
inflation.
Petitioners assert that the verification report indicates that RIMA
based its cost response on a managerial cost accounting system that was
not used for purposes of valuing inventory in the financial statements.
As such, petitioners contend that RIMA's submitted cost information
could not be reconciled with RIMA's financial statements. According to
petitioners, the verification report also indicates that RIMA based its
calculation of labor hours on theoretical times and that actual labor
hours exceeded these theoretical hours by a significant amount.
Finally, petitioners find that the Department determined that RIMA's
COP response did not account for costs associated with write-downs or
obsolescence.
Petitioners contend that RIMA's refusal to provide requested
information significantly impeded the completion of this review. In
accordance with the Department's practice, petitioners argue that the
Department should assign as BIA the higher of the highest prior margin
established for any company or the highest margin determined in this
administrative review.
Department's Position: At verification we encountered serious and
pervasive problems in our efforts to verify the information submitted
by RIMA. We found that these problems were so extensive that we could
not test major areas of the response. For those areas we tested, we
found significant discrepancies in the amounts reported, in addition to
a lack of sufficient data to corroborate the response. We outlined the
major deficiencies that we found during verification in the public
version of the cost verification report (December 22, 1993) and the
RIMA calculation memorandum, both of which are on file in the Central
Records Unit.
Under these circumstances, the Department cannot properly base its
determination on the information submitted by RIMA. The Department
cannot be placed in the position of having to identify and perform
numerous and substantial revisions to develop accurate cost data, if
indeed such revisions were even possible in this case. As stated in
Photo Albums and Filler Pages From Korea; Final Determination of Sales
at Less Than Fair Value, 50 FR 43754, 43755-43756 (October 29, 1985):
It is the obligation of respondents to provide an accurate and
complete response prior to verification so that the Department may
have the opportunity to analyze fully the information and other
parties are able to review and comment on it. Verification is
intended to establish the accuracy and completeness of a response
rather than to supplement and reconstruct the information to fit the
requirements of the Department.
Therefore, for the reasons stated above, we have determined that
rejection of the cost response submitted by RIMA is appropriate for
these final results and is consistent with past practice (see, e.g.,
Final Determination of Sales at Less Than Fair Value; Antifriction
Bearings (Other Than tapered Roller Bearings) and Parts Thereof from
the Federal Republic of Germany, et al.., 54 FR 18992 (May 3, 1989),
31704-31709, and Final Determination of Sales at Less Than Fair Value;
Sweaters Wholly or in Chief Weight of Man-Made Fiber From Taiwan, 55 FR
34586 (August 23, 1990, 34586-34587)).
In accordance with section 776(c) of the Tariff Act, we use BIA in
cases where a party refuses or is unable to produce information in a
timely manner and in the form required. The Department generally uses a
two-tiered approach in its choice of BIA. For uncooperative
respondents, the Department uses the higher of: (1) The highest rate
for any company from the original investigation or a prior
administrative review, or (2) the highest rate found in the current
review for any company. For respondents that attempt to cooperate, the
Department uses the higher of: (1) The highest rate ever applicable to
the firm for the subject merchandise, or (2) the highest calculated
rate in the current review for any firm (see Antifriction Bearings
(Other Than Tapered Roller Bearings) and Parts Thereof from France, et
al., Final Results of Antidumping Duty Administrative Review, 58 FR
39729, 39739, July 26, 1993).
RIMA responded to our questionnaire and to each of our requests for
supplemental information. Therefore, we have determined that RIMA
attempted to cooperate, even though it was unable to substantiate much
of the information contained in its COP/CV response. Since RIMA
attempted to cooperate, we have applied a rate of 91.06 percent, the
highest rate ever applicable to RIMA for the subject merchandise (see
Silicon Metal from Brazil, Final Determination of Sales at Less Than
Fair Value, 56 FR 26972, June 12, 1991).
Comment 25: Petitioners contend that it is the Department's
established practice to exclude from the dumping calculations sales
that were sold during the review period but shipped outside the period
of review. Because Eletrosilex's only sale was shipped after the close
of this review period, petitioners argue that Eletrosilex had no sales
subject to review for the current 1991-1992 administrative review.
Petitioners contend that the Department should maintain the 91.06
percent all others rate for Eletrosilex since this constitutes the most
recent information available for Eletrosilex. Petitioners note that in
Asahi Chemical Indus. Co., Ltd. v. United States, 585 F. Supp 1261,
1267 (CIT 1982), the CIT held that when there were no shipments during
the period of review, the Department uses the most recent information
to determine margins.
Department's Position: We disagree. Section 353.22(b) of our
regulations stipulates that administrative reviews ``normally will
cover, as appropriate, entries or sales of the merchandise during the
12 months immediately preceding the most recent anniversary month.''
We based this review upon sales because (1) the selling price and
each of the expenses associated with this sale were known by
Eletrosilex and reported to the Department at an early stage of the
review process, and (2) use of this sale in our margin calculations
constitutes the most accurate reflection of Eletrosilex's pricing
practices during the review period. Moreover, we note that we have
based some other administrative reviews upon sales rather than entries
(see Portable Electric Typewriters from Japan, Final Results of
Administrative Review, 56 FR 56393, 53697, November 4, 1991, and Gray
Portland Cement and Clinker from Japan, Final Results of Administrative
Review, 58 FR 48826, 48832, September 20, 1993). Finally, we note that
the question addressed in Asahi was whether we could conduct an
administrative review in the absence of exports, entries or sales
during the period of review. In this case, Eletrosilex clearly had
sales during the period of review.
Comment 26: CBCC and RIMA contend that the Department violated the
statute and the regulations by failing to publish the final results of
review by July 31, 1993. CBCC and RIMA note that section 751(a)(1) of
the Tariff Act stipulates that the Department will issue a final
determination ``(A)t least once during each 12-month period'', and that
Sec. 353.22(c)(7) of the regulations indicates that the Department will
publish a final determination ``not later than 365 days after the
anniversary month.''
CBCC and RIMA contend that the Department abused its discretion by
conducting a verification of sales and cost data since these
verifications further delayed the issuance of the final results. CBCC
and RIMA suggest that the final results should be based upon the record
that existed on July 31, 1993, and that the record at that time
indicated no dumping margins for either company.
Department's Position: We disagree. The CIT has determined that the
completion of administrative reviews within the one-year time period is
``directory'' rather than ``mandatory'' (see Koyo Seiko Co., v. United
States, 796 F. Supp. 517,523 (CIT 1992)). While we strive to complete
administrative reviews within a year, the issuance of our final results
is sometimes delayed by other regulatory and statutory requirements
associated with the administration of the antidumping law.
In this case, petitioners demonstrated that ``good cause'' existed
for verification pursuant to 19 C.F.R. Sec. 353.22(c) and 353.36(a).
Specifically, petitioners noted potential deficiencies in the
replacement cost data provided by CBCC and RIMA. Because ``good cause''
existed for verification, our decision to verify the COP responses of
CBCC and RIMA was appropriate.
Comment 27: Minasligas indicates that it agrees with the statement
in the Department's cost verification report (December 17, 1993) that
an allocation of direct and indirect labor, maintenance, and other
overhead items based upon production quantity would result in lower
fabrication charges than those reported in its questionnaire response.
(Minasligas allocated these charges on the number of furnaces in its
COP/CV response.)
Department's Position: Consistent with our finding in the Final
Determination of Sales at Less Than Fair Value; Ferrosilicon from
Brazil, 59 FR 732, 739, January 6, 1994, we have determined that the
number of furnaces is not an adequate basis for allocating labor or
other fabrication costs. The number of furnaces in a facility is an
arbitrary measure which does not necessarily reflect the actual level
of labor and overhead expended in the production of the subject
merchandise. In the instant case, output tons is a more accurate
allocation basis because these costs are directly related to production
amounts. Therefore, we have revised the submitted costs to reflect an
allocation based on actual production units.
Comment 28: Eletrosilex contends that the Department incorrectly
based its conversions of certain cruzeiro-denominated expenses (inland
freight, port charges, ocean freight, warehousing, and packing) on the
U.S. sale date. Eletrosilex argues that the Department's policy in
countries with hyperinflationary economies is to base currency
conversions on the date that the expenses were incurred. Eletrosilex
requests that the Department follow this policy with respect to the
conversion into dollars of the cruzeiro-denominated expenses outlined
above.
Department's Position: We agree. As is our standard practice in
cases where the economy is hyperinflationary, we based our currency
conversions on the date that the cost was incurred, rather than on the
date of the U.S. sale (see Final Determination of Sales at Less Than
Fair Value, Industrial Nitrocellulose from Yugoslavia (55 FR 34946,
34949, August 27, 1990), and Final Determination of Sales at Less Than
Fair Value, Oil Country Tubular Goods from Israel (52 FR 1511, 1513,
January 14, 1987)). We have adjusted our final calculations for
Eletrosilex accordingly.
Comment 29: Eletrosilex contends that the allocation of G&A and
selling expenses that the Department used in its preliminary results is
improper because it does not accurately reflect Eletrosilex's
experience as a silicon metal producer and seller during the period of
review. Eletrosilex notes that the Department relied upon the 1991
financial statement to perform this calculation, and that these
financial statements do not fully reflect Eletrosilex's experience for
the review period. Eletrosilex contends 1991 was an ``aberrational
year'' in which it incurred G&A and selling expenses which were
unrelated to the production of silicon metal.
Eletrosilex indicates that on March 10, 1993, it submitted total
G&A and selling expenses by month for every month included in the
period of review. Eletrosilex urges the Department to derive G&A and
selling expenses by summing all selling expenses and dividing the total
amount of these expenses by the total COM that Eletrosilex reported for
the period March 29, 1991 through June 30, 1992.
Department's Position: As noted in our response to Comment 11, our
current practice in cases in which the economy is hyperinflationary is
to apply the G&A and selling expenses ratio to each month's COM
calculated on a historical basis. We did not ask Eletrosilex to supply
historical COM information in this review. Accordingly, as a reasonable
alternative to our current practice, we have summed all selling
expenses reported by Eletrosilex for the period of review, and divided
this total amount by the total COM that Eletrosilex reported for the
review period.
Comment 30: RIMA contends that the Department's December 22, 1993
COP/CV verification report incorrectly characterized its personnel as
``unwilling'' to supply worksheets, schedules, and source documents.
RIMA states that it cooperated with the verification team and that the
difficulties encountered during the verification were due to: (1) The
fact that the verification outline was not made available to RIMA until
a week before commencement of the verification, (2) the company had
never previously undergone a verification, (3) there had been a good
deal of turnover in the company and the personnel responsible for the
verification did not participate in the preparation of the response,
and (4) the verification began on Saturday, continued through Sunday,
and a Brazilian national holiday.
Department's Position: We disagree with RIMA. RIMA's suggestion
that the company's problems relate to having only one week of
preparation time after receipt of the verification agenda is completely
erroneous. The verification outline was in fact released to counsel for
RIMA on October 28, 1993, and verification of RIMA's cost response
began on November 13, 1993. Thus the agenda was available more than two
weeks prior to the start of verification. Further, the verification
agenda merely indicates the Department's approach to performing the
verification. Any suggestion that the company did not realize the
Department intended to review the underlying source documents is
unsupported. The fact that the Department is particularly concerned
with each company's methodology for linking the cost response to its
cost and financial accounting system is indicated in the Department's
questionnaire (September 1, 1992), which requires the company to
provide detailed explanations of this connection. The questionnaire
also instructed company personnel to contact the Department if for any
reason they did not intend to rely on the company's cost accounting
records to prepare the response (September 1, 1992 at page 53).
RIMA's further assertions that the company's problems related to
conducting verification on a weekend and a lack of verification
experience are not persuasive. Company personnel and their counsel knew
well in advance of the need to schedule verification time on the
weekends; in fact, counsel for each of the respondents, including
counsel for RIMA, provided input in setting the verification schedule
for this case. It should also be noted that the Department's personnel
conducting the verification noted no improvement in the company's
ability to provide verification support as the verification progressed
into the regular work week. Indeed we know of no reasons why it would
improve on a particular day of the week since the information the
Department requested should be available within the company, and all of
the company personnel who participated in the verification were
available on the weekend.
It is not unusual for a respondent to be unfamiliar with the
verification process and the Department does not expect such
experience. However, if company personnel are unable to explain the
methodology followed in preparing the response and provide the source
documents which were relied upon, we are not able to conclude that this
is simply a result of being unfamiliar with the verification process.
Comment 31: RIMA argues that it used a reasonable methodology to
report quartz and charcoal costs. RIMA contends that it used its
financial accounting system to price these inputs because (1) its cost
system does not use replacement values, and (2) the cost system was
subject to distortions that were known to RIMA's management. Moreover,
RIMA argues that the variations between these two cost systems were
minor, and that RIMA provided the most accurate information in its COP/
CV response that it could.
RIMA argues that the COP/CV verification report indicates that
RIMA's production standard specifies the use of specific types of
charcoal and quartz. However, RIMA, in practice, sometimes used other
types of these materials, depending on availability. RIMA contends that
use of these other materials resulted in a lower calculated cost than
RIMA reported in its COP/CV response.
Department's Position: We disagree with RIMA's assertions that its
reported material cost were overstated. As discussed in the cost
verification report, the monthly replacement costs noted for certain of
the materials actually used in production were higher than the unit
costs for the specific materials which RIMA had indicated were used in
production. Thus these unit prices were understated.
Comment 32: RIMA asserts that it provided ``critical source
documentation'' concerning the quantity of inputs used in the
production of silicon metal, contrary to the assertion of the
Department's verification report. RIMA contends that during the
verification it made the ``underlying statistical measurements''
available for inspection by the verification team. RIMA argues that it
should not be expected to produce daily or hourly source documents
because of the great volume of papers involved.
Department's Position: We disagree with RIMA's contention that it
provided source documents. We also disagree with RIMA's assertion that
we expected the company to provide daily or hourly source documents.
RIMA was expected to provide an accurate response to the Department's
specific requests for information. As discussed in the Department's
verification report (December 22, 1993), prior to verification RIMA
completely failed to indicate the true nature of its cost and financial
accounting systems, and even stated that the systems reflect the same
costs. RIMA also indicated that its cost accounting system was relied
upon in preparing the submitted cost information. We found each of
these assertions to be inaccurate.
Although RIMA was able to provide pages of graphs which purportedly
reflected the actual material consumption, RIMA was unable to reconcile
this information to either the cost or financial accounting system.
Thus, the reported material consumption quantities were presented to
the Department quite literally in a complete vacuum, merely a handful
of graphs, unreconcilable to any other recorded measure of material
consumption. This was the extent of the underlying statistical
measurements which were made available to the Department for
inspection.
As discussed in our response to comment 24, the discrepancies noted
in the material quantity input together with other significant
inconsistencies have caused us to reject RIMA's cost submission.
Comment 33: RIMA argues that it is unfair for the Department to
penalize the company for having a cost accounting system that does not
tie to its financial accounting system. RIMA contends that its former
cost accounting system was not designed to tie into its financial
accounting system, and argues that rejection of its response is
equivalent to a penalty for providing accurate data.
Department's Position: The Department is not penalizing RIMA for
having any particular type of accounting system. RIMA's cost
information was rejected for the specific reasons which are outlined in
the public version of the cost verification report and the calculation
memorandum. We found that these problems were so extensive that major
areas of the response could not be tested. For those areas which were
tested we found significant discrepancies in the amounts reported, in
addition to a lack of sufficient data to corroborate the response.
Finally, we are unable to understand RIMA's argument that rejection
of its response is equivalent to a penalty for providing accurate data.
The record does not begin to establish that the information provided by
RIMA is accurate in any way.
Comment 34: RIMA argues that the Department's COP/CV verification
report erroneously characterized the reported labor hours as
``theoretical'' rather than ``actual''. RIMA states that it used its
statistical process control reports to calculate labor expense, and
asserts that this constitutes a more accurate way of reporting this
expense than would have been reflected in RIMA's ``managerial'' costing
system.
Department's Position: We disagree that the cost verification
report provides an erroneous characterization. The Department's cost
verification report outlines the findings at verification. As the
report indicates, the analysis upon which the reported labor cost was
based is no longer performed by RIMA and was never used for any purpose
other than the company's submission. Based upon the company's inability
to relate this analysis to any other recorded measure of costs, we
cannot conclude that the information provided reflected a ``more
accurate'' measure of the costs.
Comment 35: RIMA argues that it properly did not report several of
the home market transactions characterized as ``unreported sales'' in
the Department's December 20, 1993 sales verification report. RIMA
contends that commercial samples and intracompany transfers are not
``sales'' and should not have been reported.
Department's Position: We agree with RIMA that several of the home
market transactions which are characterized as unreported sales in our
December 23, 1993 verification report were in fact commercial samples
or intracompany transfers. We note, however, that our determination to
use BIA for RIMA was based upon RIMA's inability to provide reliable
cost data. The commercial samples and intracompany transfers referenced
in the December 23, 1993 sales verification report were not factors in
our decision to use BIA for RIMA.
Comment 36: RIMA argues that the home market sales that it did not
report made no difference in the determination of market viability or
foreign market value.
Department's Position: As noted in our response to comment 24 we
used BIA for RIMA because RIMA was unable to provide reliable cost
data. Thus, the question of whether these unreported sales would have
made a difference in the determination of foreign market value is moot.
Addendum
We have made an additional change in our analysis for these final
results: We have amended our COP calculations to adjust for the amount
of the Brazilian inflation that was factored into the home market
selling price. To make this adjustment, we compared Minasligas's and
Eletrosilex's selling prices to their respective COPs in effect as of
the date of payment rather than the date of sale.
Final Results of Review
As a result of our analysis of the comments received, we determine
that the following margins exist for the period March 9, 1991 through
June 30, 1992:
------------------------------------------------------------------------
Margin
Manufacturer/Exporter (percent)
------------------------------------------------------------------------
CBCC......................................................... 0
Minasligas................................................... 0
Eletrosilex.................................................. 0
RIMA......................................................... 91.06
------------------------------------------------------------------------
The Department shall determine, and Customs shall assess,
antidumping duties on all appropriate entries. Individual differences
between USP and FMV may vary from the percentages stated above. The
Department will issue appraisement instructions directly to Customs.
Furthermore, the following deposit requirements will be effective
upon publication of these final results of administrative review for
all shipments of silicon metal from Brazil entered, or withdrawn from
warehouse, for consumption on or after the publication date, as
provided by Section 751(a)(1) of the Tariff Act, and will remain in
effect until the final results of the next administrative review: (1)
The cash deposit rate for the reviewed companies will be those listed
above, (2) for previously investigated companies not listed above, the
cash deposit 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 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) 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 CIT's decisions in Floral Trade
Council v. United States, Slip Op. 93-79 (CIT May 25, 1993), and
Federal Mogul Corporation and Torrington Company v. United States,
Slip. Op. 93-83 (CIT May 25, 1993). The all others rate is 91.06
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 the subsequent
assessment of double antidumping duties.
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 353.34(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 an 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 (1993).
Dated: August 13, 1994.
Susan G. Esserman,
Assistant Secretary for Import Administration.
[FR Doc. 94-20455 Filed 8-18-94; 8:45 am]
BILLING CODE 3510-DS-P
