94-19071. Preliminary Determination of Sales at Less Than Fair Value and Postponement of Final Determination: Stainless Steel Bar from Spain  

  • [Federal Register Volume 59, Number 149 (Thursday, August 4, 1994)]
    [Unknown Section]
    [Page 0]
    From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
    [FR Doc No: 94-19071]
    
    
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    [Federal Register: August 4, 1994]
    
    
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    DEPARTMENT OF COMMERCE
    [A-469-805]
    
     
    
    Preliminary Determination of Sales at Less Than Fair Value and 
    Postponement of Final Determination: Stainless Steel Bar from Spain
    
    Agency: Import Administration, International Trade Administration, 
    Department of Commerce.
    
    EFFECTIVE DATE: August 4, 1994.
    
    FOR FURTHER INFORMATION CONTACT: Mary Jenkins or Kate Johnson, Office 
    of Antidumping Investigations, Import Administration, U.S. Department 
    of Commerce, 14th Street and Constitution Avenue, NW., Washington, DC 
    20230; telephone (202) 482-1756 or 482-4929, respectively.
    
    Preliminary Determination
    
        The Department of Commerce (the Department) preliminarily 
    determines that stainless steel bar (SSB) from Spain is being, or is 
    likely to be, sold in the United States at less than fair value, as 
    provided in section 733 of the Tariff Act of 1930 (the Act), as 
    amended. The estimated margins are shown in the ``Suspension of 
    Liquidation'' section of this notice.
    
    Scope of Investigation
    
        The merchandise covered by this investigation is SSB. For purposes 
    of this investigation, the term ``stainless steel bar'' means articles 
    of stainless steel in straight lengths that have been either hot-
    rolled, forged, turned, cold-drawn, cold-rolled or otherwise cold-
    finished, or ground, having a uniform solid cross section along their 
    whole length in the shape of circles, segments of circles, ovals, 
    rectangles (including squares), triangles, hexagons, octagons or other 
    convex polygons. SSB includes cold-finished SSBs that are turned or 
    ground in straight lengths, whether produced from hot-rolled bar or 
    from straightened and cut rod or wire, and reinforcing bars that have 
    indentations, ribs, grooves, or other deformations produced during the 
    rolling process.
        Except as specified above, the term does not include stainless 
    steel semi-finished products, cut length flat-rolled products (i.e., 
    cut length rolled products which if less than 4.75 mm in thickness have 
    a width measuring at least 10 times the thickness, or if 4.75 mm or 
    more in thickness having a width which exceeds 150 mm and measures at 
    least twice the thickness), wire (i.e., cold-formed products in coils, 
    of any uniform solid cross section along their whole length, which do 
    not conform to the definition of flat-rolled products), and angles, 
    shapes and sections.
        The SSB subject to this investigation is currently classifiable 
    under subheadings 7222.10.0005, 7222.10.0050, 7222.20.0005, 
    7222.20.0045, 7222.20.0075 and 7222.30.0000 of the Harmonized Tariff 
    Schedule of the United States (HTSUS). Although the HTSUS subheading is 
    provided for convenience and customs purposes, our written description 
    of the scope of this investigation is dispositive.
    
    Period of Investigation
    
        The (POI) is July 1, 1993, to December 31, 1993.
    
    Case History
    
        Since the notice of initiation on January 19, 1994 (59 FR 3844, 
    January 26, 1994), the following events have occurred.
        On February 14, 1994, the International Trade Commission (ITC) 
    issued an affirmative preliminary injury determination (USITC 
    Publication 2734, February 1994).
        On February 25, 1994, we named Roldan, S.A. (Roldan) and Acenor, 
    S.A. (Acenor) as respondents in this investigation and on February 28, 
    1994, issued antidumping questionnaires to both companies. These 
    companies represent 100 percent of U.S. imports of subject merchandise 
    from Spain during the POI. We presented the questionnaire to Roldan at 
    its facility in Madrid, Spain on March 7, 1994, and to Acenor at its 
    facility in Bilbao, Spain on March 10, 1994.
        We received Roldan's response to Section A of the Department's 
    questionnaire on March 28, 1994. We received Roldan's responses to 
    Sections B and C of the Department's questionnaire on April 21, 1994. 
    We received Acenor's responses to Sections A, B, and C of the 
    Department's questionnaire on May 18, 1994.
        On March 25, 1994, we received comments on the issue of class or 
    kind of merchandise from interested parties, per the Department's 
    invitation of such comments in its notice of initiation. On April 13, 
    1994, we received rebuttal comments on this issue. On May 11, 1994, we 
    determined that SSB constitutes one class or kind of merchandise. (See 
    May 11, 1994, Decision Memorandum to Barbara Stafford from The Team Re: 
    Class or Kind of Merchandise.)
        On May 27, 1994, the Department rescinded the COP investigations 
    against Roldan and Acenor that were initiated on January 19, 1994, 
    because the Department had reason to believe that petitioners did not 
    base their cost allegations on information reasonably available to 
    them. (See May 27, 1994, Decision Memorandum to Barbara Stafford from 
    David L. Binder Re: Rescinding the COP investigations for Acenor and 
    Roldan.) On June 13, 1994, the Department re-initiated COP 
    investigations against Roldan and Acenor based on the allegations 
    submitted by petitioners on May 9, 1994, and May 24, 1994, pursuant to 
    section 19 CFR 353.51(a) (1994). (See June 13, 1994, Decision 
    Memorandum to Barbara R. Stafford from Richard Moreland Re: 
    Petitioners' Allegations of Sales Below the Cost of Production for 
    Roldan and Acenor.) We received Roldan's and Acenor's responses, to 
    Section D of the Department's questionnaire on June 23, and June 27, 
    1994, respectively.
        On April 26, 1994, the Department received a request from 
    petitioners to postpone the preliminary determination until July 28, 
    1994. On May 16, 1994, we published in the Federal Register (59 FR 
    25447), a notice announcing the postponement of the preliminary 
    determination until not later than July 28, 1994, in accordance with 
    sections 19 CFR 353.15 (c) and (d).
        On July 13, 1994, the Department issued to each respondent a 
    supplementary questionnaire regarding Section D of the Department's 
    original questionnaire. The due dates for Acenor's and Roldan's 
    supplementary responses have been extended until August 3 and August 4, 
    1994, respectively. Consequently, this information will be received too 
    late for purposes of the preliminary determination, but will be 
    analyzed, verified, and considered for the final determination.
        On July 26, 1994, pursuant to 19 CFR 353.20(b), respondents 
    requested that the Department postpone the final determination until 
    135 days after the date of publication of the Department's preliminary 
    determination, if that determination is affirmative.
    
    Such or Similar Comparisons
    
        We have determined that all the products covered by this 
    investigation constitute a single category of such or similar 
    merchandise. We made fair value comparisons on this basis. In 
    accordance with the Department's standard methodology, we first 
    compared identical merchandise. Where there were no sales of identical 
    merchandise in the home market to compare to U.S. sales, we made 
    similar merchandise comparisons on the basis of the criteria defined in 
    Appendix V to the antidumping questionnaire, on file in Room B-099 of 
    the main building of the Department of Commerce.
        We altered the order of the SSB grades specified within the grade 
    criterion of Appendix V to account for certain other SSB grades which 
    Roldan sold during the POI, but which were not taken into account in 
    Appendix V.
        We also reversed the order of the size and shape criteria in 
    Appendix V. In our original questionnaire issued on February 28, 1994, 
    the fifth and sixth matching criteria were shape and size, 
    respectively. However, based on the advice of our in-house technical 
    expert, we reversed the order of these two criteria. Subsequently, 
    Acciaierie Valbruna (Valbruna), a respondent in the concurrent 
    antidumping investigation of SSB from Italy, requested that the 
    Department reconsider the reversal of these criteria in Appendix V. 
    Specifically, it argued that the distinguishing factor of SSBs as 
    compared to all other stainless steel products is that they can be 
    supplied in a variety of shapes and that the COP and price of SSBs are 
    influenced significantly more by shape than size. In light of the 
    arguments raised by Valbruna, we reversed the hierarchy of these 
    criteria to reflect the order in our original Appendix V. Although the 
    issue was not raised by any interested party in the instant 
    investigation, we reversed the order of these criteria to ensure 
    consistent treatment of respondents in performing product comparisons 
    across all concurrent SSB investigations.
    
    Related Party Sales
    
        On April 21, 1994, Roldan reported sales made to both related and 
    unrelated distributors, and unrelated end users in the home market. We 
    compared related party prices to unrelated party prices using the test 
    set forth in Appendix II to Final Determination of Sales at Less than 
    Fair Value; Certain Cold-rolled Carbon Steel Flat Products from 
    Argentina, 58 FR 37062 (July 9, 1994), and determined that the sales 
    made to related parties were not at arm's length. We subsequently 
    requested that Roldan and Acenor report all sales made by their related 
    parties to the first unrelated customer in the home market. These 
    sales, reported on June 29, and July 1, for Acenor and Roldan, 
    respectively, were submitted too late to be properly analyzed for use 
    in the preliminary determination.
        On June 13, 1994, Roldan submitted a revised home market sales 
    listing including Roldan's sales to both related and unrelated parties. 
    However, for the preliminary determination we did not use portions of 
    the revised sales listing containing related party sales because we 
    found certain discrepancies between the related party sales data 
    contained in respondent's original and revised responses. However, we 
    intend to clarify these discrepancies prior to verification and 
    consider respondent's revised related party sales listing for the final 
    determination based on verification findings. Therefore, for purposes 
    of the preliminary determination, we only used the portion of Roldan's 
    sales listing pertaining to sales made directly to unrelated parties in 
    our analysis.
        For Acenor, we compared prices to a related party with prices to 
    unrelated parties using the test referenced above and determined that 
    the sales made to the related party were not at arm's length. 
    Accordingly, we used only sales made directly to unrelated parties 
    reported in Acenor's June 29, 1994, sales listing.
    
    Fair Value Comparisons
    
        To determine whether sales of SSB from Spain to the United States 
    were made at less than fair value, we compared the United States price 
    (``USP'') to the foreign market value (``FMV''), as specified in the 
    ``United States Price'' and ``Foreign Market Value'' sections of this 
    notice. In accordance with 19 CFR 353.58, we made comparisons at the 
    same level of trade, where possible.
    
    United States Price
    
        For both Roldan and Acenor, we based USP on purchase price (PP), in 
    accordance with section 772(b) of the Act, because the subject 
    merchandise was sold to unrelated purchasers in the United States 
    before importation and exporter's sales price methodology was not 
    otherwise indicated.
        We made an adjustment to USP for the value-added tax (VAT) paid on 
    the comparison sales in Spain, in accordance with our practice, 
    pursuant to the Court of International Trade (CIT) decision in Federal-
    Mogul Corp. and The Torrington Co. v. United States, Slip Op. 93-194 
    (CIT, October 7, 1993). (See Final Determination of Sales at Less than 
    Fair Value: Calcium Aluminate Cement, Cement Clinker and Flux from 
    France, 59 FR 14136, March 25, 1994).
        We re-calculated the VAT for both Roldan and Acenor because the 
    methodology they employed in reporting the VAT was not clearly defined. 
    The VAT will be examined at verification and re-analyzed for the final 
    determination.
    
    Roldan
    
        We calculated PP based on CIF delivered prices to unrelated 
    customers in the United States. We made deductions, where appropriate, 
    for foreign brokerage and handling, foreign inland freight, ocean 
    freight, marine insurance, U.S. brokerage and handling (including 
    insurance), U.S. inland freight and U.S. import duties.
        We made no adjustment for freight charge differentials claimed by 
    Roldan because of the lack of data on the record concerning the nature 
    of the adjustment claimed. We intend to obtain further information and 
    to verify the reported data. We will revisit this issue in our final 
    determination based on verification findings.
    
    Acenor
    
        We calculated PP based on ex-factory packed prices to unrelated 
    customers. Accordingly, we made no adjustments to these reported 
    prices.
    
    Foreign Market Value
    
        In order to determine whether there were sufficient sales of SSB in 
    the home market to serve as a viable basis for calculating FMV, we 
    compared the volume of home market sales of SSB to the volume of third 
    country sales of SSB in accordance with section 773(a)(1)(B) of the 
    Act. Based on this comparison, we determined that both respondents had 
    viable home markets with respect to sales of SSB during the POI.
    
    Cost of Production
    
        Petitioners alleged that Roldan and Acenor were selling in the home 
    market at prices below COP in the petition filed in this investigation. 
    The Department initiated COP investigations for both respondents on 
    January, 19, 1994. However, as stated above, the Department rescinded 
    the original COP investigations. After reviewing petitioners' revised 
    allegations, we re-initiated COP investigations. We requested that 
    respondents reply to Section D of our antidumping questionnaires issued 
    on February 28, 1994. Roldan and Acenor submitted their responses to 
    Section D of our questionnaire on June 23, and June 27, 1994, 
    respectively. On July 13, 1994, the Department sent Roldan and Acenor a 
    Section D deficiency questionnaire.
        In order to determine whether home market prices were below COP 
    within the meaning of section 773(b) of the Act, we calculated COP 
    based on the sum of the respondents' cost of materials, fabrication, 
    general expenses and home market packing costs. We compared individual 
    home market prices with the COPs. We tested the home market prices on a 
    product-specific basis using Roldan's sales to unrelated customers from 
    the database received on June 13, 1994, and Acenor's sales to unrelated 
    customers from the database received on June 29, 1994. We compared 
    model-specific COP to reported prices that were net of movement 
    charges.
        Following our standard practice, where we found over 90 percent of 
    a respondent's sales of a given product were at prices above the COP, 
    we did not disregard any below-cost sales because we determined that 
    the respondent's below-cost sales were not made in substantial 
    quantities. If between ten and 90 percent of a respondent's sales of a 
    given product were at prices above the COP, we discarded only the 
    below-cost sales if made over an extended period of time. Where we 
    found that more than 90 percent of a respondent's sales of a given 
    product were at prices below the COP and were sold over an extended 
    period of time, we disregarded all sales for that model and calculated 
    FMV based on constructed value (CV), in accordance with section 773(b) 
    of the Act.
        If sales below cost occurred in three or more months of the POI, 
    they are considered to be made over an extended period of time. For 
    sales made in less than three months of the POI, the extended period of 
    time is the number of months in which the sales occur. (See, 19 U.S.C. 
    1677b(b)(1)).
        Roldan and Acenor provided no indication that the disregarded sales 
    were at prices that would permit recovery of all costs within a 
    reasonable period of time and in the normal course of trade. (See, 19 
    U.S.C. 1677b(b)(2)).
    
    Constructed Value (CV)
    
        We calculated CV based on the sum of the cost of materials, 
    fabrication, general expenses, U.S. packing costs and profit. In 
    accordance with section 773(e)(1)(B)(i) and (ii) of the Act we: (1) 
    Included the greater of respondents' reported general expenses or the 
    statutory minimum of ten percent of the COM, as appropriate and; (2) 
    for profit, we used the statutory minimum of eight percent of the sum 
    of COM and general expenses.
    
    Roldan
    
        For purposes of calculating FMV, we used the sales from Roldan to 
    its unrelated customers and CV, as described above.
        For price-to-price comparisons, we calculated FMV based on 
    delivered prices, inclusive of packing to unrelated customers in the 
    home market.
        In light of the Court of Appeals for the Federal Circuit's decision 
    in Ad Hoc Committee of AZ-NM-TX-FL Producers of Gray Portland Cement V. 
    United States, 13 F.3d 398 (Fed. Cir., 1994), the Department no longer 
    can deduct home market movement charges from FMV pursuant to its 
    inherent power to fill in gaps in the antidumping statute. Instead, we 
    adjust for those expenses under the circumstance-of-sale provision of 
    19 CFR 353.56(a) and the exporter's sales price offset provision of 19 
    CFR 353.56(b)(2), as appropriate. Accordingly, in the present case, we 
    deducted post-sale home market movement charges from the FMV under the 
    circumstance-of-sale provision of 19 CFR 353.56(a). This adjustment 
    included home market inland freight (including inland insurance).
        For both price-to-price comparisons and comparisons to CV, we made 
    circumstance-of-sale adjustments, where appropriate, for differences in 
    credit expenses, pursuant to 19 CFR 353.56(a)(2). We re-calculated home 
    market and U.S. credit expenses because Roldan reported an average 
    interest rate for a seven-month period, rather than the six-month POI. 
    In addition, for those sales with missing shipment dates and payment 
    dates, we calculated credit expenses based on the average payment 
    period for the respondent's sales reported with shipment and payment 
    dates.
        We did not make a circumstance-of-sale adjustment for commissions 
    claimed by Roldan that were paid to its parent company for export sales 
    services performed by the parent company's commercial department. We 
    also did not adjust for commissions paid by Roldan to the U.S. 
    subsidiary of its parent company for marketing Roldan's products in the 
    United States. We consider these payments to be intra-company transfers 
    not tied directly to sales of the subject merchandise. Furthermore, we 
    have no appropriate benchmark against which to test whether the 
    commission arrangements between Roldan and its related party 
    commissionaires are at arm's length. (See Final Determination of Sales 
    at Less than Fair Value; Coated Groundwood Paper from Belgium, Finland, 
    France, Germany and the United Kingdom, 56 FR 56359, November 4, 1992.)
        We also deducted home market packing and added U.S. packing costs, 
    in accordance with section 773(a)(1) of the Act.
        For price-to-price comparisons only, we also made adjustments, 
    where appropriate, for differences in the physical characteristics of 
    the merchandise in accordance with section 773(a)(4)(C) of the Act. We 
    adjusted for VAT in accordance with our practice. (See the ``United 
    States Price'' section of this notice, above.)
        We made no adjustment for freight charge differentials claimed by 
    Roldan because of the lack of data on the record concerning the nature 
    of the adjustment claimed. We intend to obtain further information and 
    to verify the reported data. We will revisit this issue in our final 
    determination based on verification findings.
    
    Acenor
    
        For purposes of calculating FMV, we used the sales from Acenor to 
    its unrelated customers and CV, as described above.
        For price-to-price comparisons, we calculated FMV based on packed, 
    ex-factory and delivered prices, where applicable. We made an 
    adjustment for home market inland freight (including inland insurance), 
    where applicable, under the circumstance-of-sale provision of 19 CFR 
    353.56(a), as described above.
        For price-to-price comparisons and comparisons to CV, we made 
    circumstance-of-sale adjustments, where appropriate, for differences in 
    credit expenses, pursuant to 19 CFR 353.56(a)(2). We re-calculated home 
    market and U.S. credit expenses because Acenor reported its U.S. 
    imputed credit expense in pesetas and its calculation overstated this 
    expense because of an error in decimal placement. In addition, for 
    those sales with missing shipment dates and payment dates, we 
    calculated credit expenses based on the average payment period for the 
    respondent's sales reported with shipment and payment dates.
        We also deducted home market packing and added U.S. packing costs, 
    in accordance with section 773(a)(1) of the Act.
        For price-to-price comparisons only, we also made adjustments, 
    where appropriate, for differences in the physical characteristics of 
    the merchandise, in accordance with section 773(a)(4)(C) of the Act. We 
    adjusted for VAT in accordance with our practice. (See the ``United 
    States Price'' section of this notice, above.)
    
    Currency Conversion
    
        We made currency conversions based on the official exchange rates 
    in effect on the dates of the U.S. sales as certified by the Federal 
    Reserve Bank of New York. See 19 CFR 353.60(a).
    
    Verification
    
        As provided in section 776(b) of the Act, we will verify the 
    information used in making our final determination.
    
    Suspension of Liquidation
    
        In accordance with section 733(d)(1) of the Act, we are directing 
    the Customs Service to suspend liquidation of all entries of SSB from 
    Spain, as defined in the ``Scope of Investigation'' section of this 
    notice, that are entered, or withdrawn from warehouse, for consumption 
    on or after the date of publication of this notice in the Federal 
    Register. The Customs Service shall require a cash deposit or the 
    posting of a bond equal to the estimated preliminary dumping margins, 
    as shown below. The suspension of liquidation will remain in effect 
    until further notice. The weighted-average dumping margins are as 
    follows:
    
    ------------------------------------------------------------------------
                                                                      Margin
                    Manufacturer/producer/exporter                   percent
                                                                            
    ------------------------------------------------------------------------
    Roldan, S.A....................................................    25.21
    Acenor, S.A....................................................     8.96
    All Others.....................................................    17.89
    ------------------------------------------------------------------------
    
    ITC Notification
    
        In accordance with section 733(f) of the Act, we have notified the 
    ITC of our determination. If our final determination is affirmative, 
    the ITC will determine whether imports of the subject merchandise are 
    materially injuring, or threaten material injury to, the U.S. industry, 
    before the later of 120 days after the date of the preliminary 
    determination or 45 days after our final determination.
    
    Postponement of Final Determination
    
        Pursuant to section 735(a)(2)(A) of the Act, on July 26, 1994, 
    respondents accounting for all exports to the United States during the 
    POI requested that, in the event of an affirmative preliminary 
    determination in this investigation, the Department postpone its final 
    determination until 135 days after the date of publication of an 
    affirmative preliminary determination. Pursuant to 19 CFR 353.20(b), 
    because our preliminary determination is affirmative, and no compelling 
    reasons for denial exist, we are postponing the date of the final 
    determination until the 135th day after the date of publication of this 
    notice in the Federal Register.
    
    Public Comment
    
        In accordance with 19 CFR 353.38, case briefs or other written 
    comments in at least ten copies must be submitted to the Assistant 
    Secretary for Import Administration no later than November 9, 1994, and 
    rebuttal briefs no later than November 16, 1994. In accordance with 19 
    CFR 353.38(b), we will hold a public hearing, if requested, to give 
    interested parties an opportunity to comment on arguments raised in 
    case or rebuttal briefs. Tentatively, the hearing will be held on 
    November 18, 1994, at 2:00 p.m. at the U.S. Department of Commerce, 
    Room 1414, 14th Street and Constitution Avenue, NW., Washington, D.C. 
    20230. Parties should confirm by telephone the time, date, and place of 
    the hearing 48 hours before the scheduled time.
        Interested parties who wish to request a hearing must submit a 
    written request to the Assistant Secretary for Import Administration, 
    U.S. Department of Commerce, Room B-099, within ten days of the 
    publication of this notice in the Federal Register. Request should 
    contain: (1) The party's name, address, and telephone number; (2) the 
    number of participants; and (3) a list of the issues to be discussed. 
    In accordance with 19 CFR 353.38(b), oral presentation will be limited 
    to issues raised in the briefs.
        This determination is published pursuant to section 733(f) of the 
    Act (19 U.S.C. 1673b(f)) and 19 CFR 353.15(a)(4).
    
        Dated: July 28, 1994.
    Barbara R. Stafford,
    Acting Assistant Secretary for Investigations.
    [FR Doc. 94-19071 Filed 8-3-94; 8:45 am]
    BILLING CODE 3510-DS-P
    
    
    

Document Information

Published:
08/04/1994
Department:
Commerce Department
Entry Type:
Uncategorized Document
Document Number:
94-19071
Dates:
August 4, 1994.
Pages:
0-0 (1 pages)
Docket Numbers:
Federal Register: August 4, 1994, A-469-805