00-2585. Final Results of Expedited Sunset Reviews: Certain Welded Stainless Steel Pipes From the Republic of Korea and Taiwan

AGENCY:

Import Administration, International Trade Administration, Department of Commerce.

ACTION:

Notice of Final Results of Expedited Sunset Reviews: Certain Welded Stainless Steel Pipes from the Republic of Korea and Taiwan.

SUMMARY:

On July 1, 1999, the Department of Commerce (“the Department”) initiated sunset reviews of the antidumping duty orders on certain welded stainless steel pipes (“pipes”) from the Republic of Korea (“Korea”) and Taiwan (64 FR 35588) pursuant to section 751(c) of the Tariff Act of 1930, as amended (“the Act”). On the basis of a notice of intent to participate and an adequate response filed on behalf of a domestic interested party and inadequate response (in these cases, no response) from respondent interested parties in each of these reviews, the Department decided to conduct expedited reviews. As a result of these reviews, the Department finds that revocation of the antidumping duty orders would be likely to lead to the continuation or recurrence of dumping at the levels indicated in the Final Results of Reviews section of this notice.

FOR FURTHER INFORMATION CONTACT:

Mark D. Young or Melissa G. Skinner, Office of Policy for Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, NW, Washington, DC 20230; telephone: [phone] or [phone], respectively.

EFFECTIVE DATE:

February 4, 2000.

Statute and Regulations

These reviews were conducted pursuant to sections 751(c) and 752 of the Act. The Department's procedures for conducting sunset reviews are set forth in Procedures for Conducting Five-year (“Sunset”) Reviews of Antidumping and Countervailing Duty Orders, 63 FR 13516 (March 20, 1998) (“Sunset Regulations”), and 19 CFR part 351 (1999) in general. Guidance on methodological or analytical issues relevant to the Department's conduct of sunset reviews is set forth in the Department's Policy Bulletin 98:3 “ Policies Regarding the Conduct of Five-year (“Sunset”) Reviews of Antidumping and Countervailing Duty Orders; Policy Bulletin, 63 FR 18871 (April 16, 1998) (“Sunset Policy Bulletin”).

Scope

The merchandise subject to these reviews are certain welded austenitic stainless steel pipe that meets the standards and specifications set forth by the American Society for Testing and Materials (“ASTM”) for the welded form of chromium-nickel pipe designated ASTM A-312. The merchandise covered by the scope of these orders also includes austenitic welded stainless steel pipes made according to the standards of other nations which are comparable to ASTM A-312. Pipes are produced by forming stainless steel flat-rolled products into a tubular configuration and welding along the seam. Pipes are a commodity product generally used as a conduit to transmit liquids or gases. Major applications for pipes include, but are not limited to, digester lines, blow lines, pharmaceutical lines, petrochemical stock lines, brewery process and transport lines, general food processing lines, automotive paint lines, and paper process machines. Imports of pipes are currently classifiable under the following Harmonized Tariff Schedule of the United States (“HTSUS”) subheadings: 7306.40.5005, 7306.40.5015, 7306.40.5040, 7306.40.5065, and 7306.40.5085. Although these subheadings include both pipes and tubes, the scope of this order is limited to welded austenitic stainless steel pipes. Although the HTSUS subheadings are provided for convenience and United States Customs purposes, our written description of the scope of these orders are dispositive.

History of the Orders

Korea

The Department published its final affirmative determination of sales at less than fair value (“LTFV”) with respect to imports of pipes from Korea on November 12, 1992 (57 FR 53693). In this determination and subsequent antidumping duty order, the Department published two weighted-average dumping margins and an “all others” rate.^[1] These margins were later amended by the Department pursuant to a ruling by the Court of International Trade. ^[2] The Department has not completed an administrative review of this order since its imposition; ^[3] however, there has been one changed-circumstance review. ^[4] The order remains in effect for all Korean manufacturers and exporters of the subject merchandise.

Taiwan

On November 12, 1992, the Department issued its final affirmative determination of sales at LTFV regarding pipes from Taiwan (Final Determination of Sales at Less Than Fair Value: Certain Welded Stainless Steel Pipes from Taiwan, 57 FR 53705 (November 12, 1992). In this determination, the Department published four weighted-average dumping margins and an “all others” rate.^[5] These margins were later amended by the Department,^[6] pursuant to a ruling by the Court of International Trade.^[7] Since the order was issued, the Department has completed four administrative reviews ^[8] and one changed-circumstances review ^[9] with respect to pipes from Taiwan. The order remains in effect for all manufacturers and exporters of the subject merchandise from Taiwan, other than Chang Mien.

Background

On July 1, 1999, the Department initiated sunset reviews of the antidumping duty orders on pipes from Korea and Taiwan (64 FR 35588), pursuant to section 751(c) of the Act. We received Notices of Intent To Participate, in each of the two sunset reviews, on behalf of Avesta Sheffield Pipe Co., Damascus Tubular Division of Damascus-Bishop Tube Co., Davis Pipe Inc., and the United Steel Workers of America (AFL-CIO/CLC) (collectively “domestic interested parties”), by July 16, 1999, within the deadline specified in § 351.218(d)(1)(i) of the Sunset Regulations. Pursuant to section 771(9)(C) and (D) of the Act, the domestic interested parties claimed interested-party status as U.S. manufacturers and workers engaged in the production of domestic like products. Moreover, the domestic interested parties stated that they have been involved in all segments of these proceedings since their inception. The Department received complete substantive responses from the domestic interested parties by August 2, 1999, within the 30-day deadline specified in the Sunset Regulations under § 351.218(d)(3)(i). On August 2, 1999, the Department received a waiver of participation, in the sunset review of certain welded stainless steel pipes from Korea, on behalf of Korea Iron & Steel Association (“KOSA”), SeAH Steel Corporation, Ltd. (“SeAH”), and Hyundai Pipe Co., Ltd. (“Hyundai”). We did not receive a substantive response from any respondent interested party to these proceedings. As a result, pursuant to 19 CFR 351.218(e)(1)(ii)(C)(2), the Department determined to conduct expedited, 120-day, reviews of these orders.

In accordance with section 751(c)(5)(C)(v) of the Act, the Department may treat a review as extraordinarily complicated if it is a review of a transition order (i.e., an order in effect on January 1, 1995). The reviews at issue concern transition orders within the meaning of section 751(c)(6)(C)(ii) of the Act. Therefore, the Department determined that the sunset reviews of the antidumping duty orders on pipes from Korea and Taiwan are extraordinarily complicated and extended the time limit for completion of the final results of these reviews until not later than January 27, 2000, in accordance with section 751(c)(5)(B) of the Act.^[10]

Although the deadline for this determination was originally January 27, 2000, due to the Federal Government shutdown on January 25 and 26, 2000, resulting from inclement weather, the time frame for issuing this determination has been extended by one day.

Determination

In accordance with section 751(c)(1) of the Act, the Department conducted these reviews to determine whether revocation of the antidumping duty orders would be likely to lead to continuation or recurrence of dumping. Section 752(c) of the Act provides that, in making these determinations, the Department shall consider the weighted-average dumping margins determined in the investigation and subsequent reviews and the volume of imports of the subject merchandise for the period before and the period after the issuance of the antidumping duty order, and it shall provide to the International Trade Commission (“the Commission”) the magnitude of the margins of dumping likely to prevail if the order were revoked.

The Department's determinations concerning continuation or recurrence of dumping and the magnitude of the margins are discussed below. In addition, the domestic interested parties' comments with respect to continuation or recurrence of dumping and the magnitude of the margins are addressed within the respective sections below.

Continuation or Recurrence of Dumping

Drawing on the guidance provided in the legislative history accompanying the Uruguay Round Agreements Act (“URAA”), specifically the Statement of Administrative Action (“the SAA”), H.R. Doc. No. 103-316, vol. 1 (1994), the House Report, H.R. Rep. No. 103-826, pt. 1 (1994), and the Senate Report, S. Rep. No. 103-412 (1994), the Department issued its Sunset Policy Bulletin providing guidance on methodological and analytical issues, including the bases for likelihood determinations. In its Sunset Policy Bulletin, the Department indicated that determinations of likelihood will be made on an order-wide basis (See Sunset Policy Bulletin, 63 FR at 18872). In addition, the Department indicated that normally it will determine that revocation of an antidumping duty order is likely to lead to continuation or recurrence of dumping where (a) dumping continued at any level above de minimis after the issuance of the order, (b) imports of the subject merchandise ceased after the issuance of the order, or (c) dumping was eliminated after the issuance of the order and import volumes for the subject merchandise declined significantly (see id).

In addition to considering the guidance on likelihood cited above, section 751(c)(4)(B) of the Act provides that the Department shall determine that revocation of the order would be likely to lead to continuation or recurrence of dumping where a respondent interested party waives its participation in the sunset review. We received a waiver of participation, in the sunset review of certain stainless steel pipes from Korea, from KOSA, SeAH, and Hyundai on August 2, 1999. The Department did not receive a substantive response from any respondent interested party. Pursuant to § 351.218(d)(2)(iii) of the Sunset Regulations, lack of substantive response from respondent interested parties constitutes a waiver of participation.

In their substantive responses, the domestic interested parties argue that revocation of these antidumping duty orders would likely lead to a continuation or recurrence of dumping by Korean and Taiwanese producers/manufacturers. The domestic interested parties argue that the records in these proceedings demonstrate that respondents reduced their sales to the United States after the issuance of the orders and continued to dump at the same or at higher rates of dumping. Further, they argue that the substantial decline in the volume of imports of pipes from Korea and Taiwan following the issuance of the orders demonstrates the inability of the producers from subject countries to sell in the United States at any significant volume without dumping. They support this argument with statistics showing that, since the imposition of the orders, respondents have generally reduced their shipments to the United States. Therefore, they assert, were the antidumping duty orders revoked, it is likely that Korean and Taiwanese producers would need to dump in order to sell their pipes in any significant quantities in the United States. In conclusion, the domestic interested parties state that whether comparing the level of imports during the calendar year encompassing the period of investigation or the calendar year most immediately preceding the order, the dramatic decrease in import levels underscores the importance of the orders in the domestic market.

Korea

With respect to subject merchandise from Korea, the domestic interested parties maintain that Korean importers need to dump pipes in the U.S. market in order to sell at pre-order volumes. They state that the order's extraordinary impact on imports in the period following the issuance of the order demonstrates the inability of Korean producers to sell pipes in the United States without dumping. The domestic interested parties also note that in 1998 Korean imports of the subject merchandise jumped to 116 percent of 1991 levels after Pusan purchased Sammi Metal Products Co., Ltd. (“Sammi”) pipe division out of bankruptcy. Apart from 1998's unusually high level, they argue that imports of the subject merchandise from Korea following the issuance of the order have never been more than 59 percent of their 1991 level.^[11]

Taiwan

The domestic interested parties argue that the imposition of the antidumping duty order had a dramatic effect on subject import volumes from Taiwan. In addition, they note that post-order imports from Taiwan have, on average, remained at 57 percent of the 1991 level. Even in 1998, the domestic interested parties add, when consumption of stainless steel products was at an all time high, imports from Taiwan were only 80 percent of 1991 imports. In conclusion they state that a comparison of the pre- and post-order import levels supports a reasonable inference that dumping would continue absent the disciplinary influence of the order.^[12]

If companies continue dumping with the discipline of an order in place or imports ceased after the issuance of the order, the Department may reasonably infer that dumping would continue or recur if the discipline were removed (see section II.A.3 of the Sunset Policy Bulletin, the SAA at 890, and the House Report at 63-64). Dumping margins above de minimis continue to exist for all producers and exporters of pipes from Korea and Taiwan, other than Chang Mien, which was excluded from the order on Taiwan.

Consistent with section 752(c) of the Act, the Department also considers the volume of imports before and after issuance of the order. As outlined in each respective section above, the domestic interested parties argue that a significant decline in the volume of imports of the subject merchandise from Korea and Taiwan since the imposition of the orders provides further evidence that dumping would continue if the orders were revoked. In their substantive responses, the domestic interested parties provided statistics demonstrating the decline in import volumes of pipes from Korea and Taiwan immediately following the issuance of the orders. The Department agrees with the domestic interested parties' arguments that imports of the subject merchandise fell after the orders were imposed and never regained pre-order volumes.^[13]

As noted above, in conducting its sunset reviews, the Department considered the weighted-average dumping margins and volume of imports in determining whether revocation of these antidumping duty orders would lead to the continuation or recurrence of dumping. Based on this analysis, the Department finds that the existence of dumping margins at levels above de minimis after the issuance of the orders is highly probative of the likelihood of continuation or recurrence of dumping. A deposit rate above de minimis continues in effect for exports of the subject merchandise by all known Korean and Taiwanese manufacturers/exporters of the subject merchandise.^[14] Therefore, given that dumping has continued over the life of the orders, import volumes have declined significantly after the imposition of the order, ^[15] respondent parties have waived participation, and absent argument and evidence to the contrary, the Department determines that dumping is likely to continue or recur if the orders were revoked.

Magnitude of the Margin

In the Sunset Policy Bulletin, the Department stated that normally it will provide to the Commission the margin that was determined in the final determination in the original investigation. Further, for companies not specifically investigated or for companies that did not begin shipping until after the order was issued, the Department normally will provide a margin based on the “all others” rate from the investigation. See Sunset Policy Bulletin, 63 FR at 18873. Exceptions to this policy include the use of a more recently calculated margin, where appropriate, and consideration of duty-absorption determinations. See id, 63 FR at 18873-74. To date, the Department has not issued any duty-absorption findings in any of these cases.

In their substantive response, the domestic interested parties recommended that, consistent with the Sunset Policy Bulletin, the Department provide to the Commission the company-specific margins from the original investigation, except that the Department should use the 31.90 percent margin assigned to Ta Chen Stainless Pipe Co., Ltd. (“Ta Chen”) in the first two annual administrative reviews, not the 3.27 percent found in the original investigation. Moreover, regarding companies not reviewed in the original investigations, the domestic interested parties suggested that the Department report the “all others” rates included in the original investigations.

In the Sunset Policy Bulletin we indicated that, consistent with the SAA and the House Report, we may determine, in cases where declining (or no) dumping margins are accompanied by steady or increasing imports, that a more recently calculated rate reflects that companies do not have to dump to maintain market share in the United States and, therefore, that dumping is less likely to continue or recur if the order was revoked. Alternatively, if a company chooses to increase dumping in order to increase or maintain market share, the Department may provide the Commission with a more recently calculated margin for that company. The Sunset Policy Bulletin provides that we will entertain such considerations in response to argument from an interested party. Further, we noted that, in determining whether a more recently calculated margin is probative of an exporter's behavior absent the discipline of an order, the Department normally will consider the company's relative market share, with such information to be provided by the parties. It is clear, therefore, that in determining whether a more recently calculated margin is probative of the behavior of exporters were the order revoked, the Department considers company-specific exports and company-specific margins. Additionally, although we expressed a clear preference for market-share information, in past sunset reviews, where market-share information was not available, we relied on changes in import volumes between the periods before and after the issuance of the order. See, e.g., Final Results of Expedited Sunset Review: Stainless Steel Plate from Sweden, 63 FR 67658 (December 8, 1998), and Final Results of Expedited Sunset Reviews: Certain Iron Construction Castings From Brazil, Canada, and the People's Republic of China, 64 FR 30310 (June 7, 1999).

In sunset reviews, although we make likelihood determinations on an order-wide basis, we report company-specific margins to the Commission. Therefore, it is appropriate that our determinations regarding the magnitude of the margin likely to prevail be based on company-specific information. Generic arguments that margins decreased over the life of the order while, at the same time, exporters' share of the U.S. market remained constant do not address the question of whether any particular company decreased its margin of dumping while at the same time maintaining or increasing market share. In fact, such generic argument may disguise company-specific behavior demonstrating increased dumping coupled with increased market share.

Our review of import statistics, provided by the domestic interested parties, covering pipes from Korea and Taiwan demonstrated that the margins calculated in the original investigations are probative of the behavior of Korean and Taiwanese manufacturers/exporters if the orders were revoked as they are the only margins which reflect their actions absent the discipline of the order. However, with respect to Ta Chen, the Department disagrees with the domestic interested parties. Absent evidence that Ta Chen chose to increase dumping in order to maintain or increase market share, the margin calculated in the original investigation is the margin the Department will provide to the Commission.^[16]

Therefore, the Department will report to the Commission the company-specific and all others rates from the original investigations as contained in the Final Results of Reviews section of this notice.

Final Results of Reviews

As a result of these reviews, the Department finds that revocation of the antidumping duty orders would likely lead to continuation or recurrence of dumping at the margins listed below:

Korea

Manufacturer/exporter	Margin (percent)
Pusan Steel Pipe Co., Ltd (now SeAH Steel Corp.)1	2.67
All manufacturers/producers/exporters	7.00
1 SeAH is the corporate successor to Pusan, and Pusan had acquired certain of Sammi’s production assets. See Certain Welded Stainless Steel Pipe from Korea; Final Results of Changed-Circumstances Antidumping Duty Administrative Review, 63 FR 16979 (April 7, 1998).

Taiwan

Manufacturer/exporter	Margin (percent)
Chang Tieh Industry Co., Ltd (now Chang Mien)1	excluded.
Jaung Yuann Enterprise Co., Ltd.	31.91.
Ta Chen Stainless Pipe Co., Ltd	3.27.
Yeun Chyang Industrial Co., Ltd.	31.90.
All Others	19.84.
1 For the purposes of antidumping duty law the Department concluded that Chang Mein is the successor firm to Chang Tieh, and, as such is excluded from the order. See Certain Welded Stainless Steel Pipe From Taiwan; Final Results of Changed-Circumstances Antidumping Duty Administrative Review, 63 FR 34147 (June 23, 1998).

This notice serves as the only reminder to parties subject to administrative protective order (“APO”) of their responsibility concerning the disposition of proprietary information disclosed under APO in accordance with 19 CFR 351.305 of the Department's regulations. Timely 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 five-year (“sunset”) review and notice are in accordance with sections 751(c), 752, and 777(i)(1) of the Act.

Dated: January 28, 2000.

Holly A. Kuga,

Acting Assistant Secretary for Import Administration.

Footnotes

1.  See Antidumping Duty Order and Clarification; Certain Welded Stainless Steel Pipes from the Republic of Korea, 57 FR 62301 (December 30, 1992) (clarifying HTSUS numbers).

2.  See Avesta Sheffield, Inc. v. United States, 17 CIT 1212, 838 F.Supp. 608 (1993); see also Federal Mogul Corp. and the Torrington Co. v. United States, 17 CIT 1093, 834 F.Supp. 1391 (1993); and Amended Final Determination and Antidumping Duty Order: Certain Welded Stainless Steel Pipe From Korea, 60 FR 10064 (February 23, 1995).

3.  However, on December 28, 1999, the Department issued preliminary results of review in this case. See Certain Welded ASTM A-312 Stainless Steel Pipe from Korea: Preliminary Results of Antidumping Duty Administrative Review, 64 FR 72645 (December 28, 1999).

4.  See Certain Welded Stainless Steel Pipe From Korea; Final Results of Changed-Circumstances Antidumping Duty Administrative Review, 63 FR 16979 (April 7, 1998) (determination that SeAH Steel Corp. (“SeAH”) is the corporate successor to Pusan Steel Pipe Co., Ltd. (“Pusan”)).

5.  Chang Tieh Industry Co. Ltd. (“Chang Tieh”) currently Chang Mien was excluded from the Taiwanese antidumping duty order in light of the zero percent margin it received in the final determination of sales at LTFV. However, it was listed as one of the four respondent companies originally investigated by the Department (57 FR 5370); see also Notice of Amended Final Determination and Antidumping Duty Order; Certain Welded Stainless Steel Pipes from Taiwan, 59 FR 6619 (February 11, 1994) and Chang Tieh Industry Co. v. United States, 840 F.Supp. 141 (Ct. Int'l Trade 1993) (regarding the Department's error in imposing conditions upon Chang Tieh's exclusion from the antidumping duty order.)

6.  Notice of Amended Final Determination, 59 FR 6619.

7.  See Chang Tieh Industry Co. 840 F.Supp. at 141.

8.  See Welded Stainless Steel Pipes from Taiwan; Final Results of Administrative Review, 64 FR 33243 (June 22, 1999) (the first and second administrative reviews were jointly published); 62 FR 37543 (July 14, 1997); 63 FR 38382 (July 16, 1998).

9.  See Certain Welded Stainless Steel Pipe From Taiwan; Final Results of Changed-Circumstances Antidumping Duty Administrative Review, 63 FR 34147 (June 23, 1998) (determination that Chang Mien Industries Co., Ltd (“Chang Mien”) is the corporate successor to Chang Tieh).

10.  See Extension of Time Limit for Final Results of Five-Year Reviews, 64 FR 62167 (November 16, 1999).

11.  See August 2, 1999, Substantive Response of the Domestic Interested Parties regarding pipes from Korea at 16.

12.  See August 2, 1999, Substantive Response of the Domestic Interested Parties regarding pipes from Taiwan at 15.

13.  With the exception of Korean imports of the subject merchandise in 1998, which increased to 116 percent of 1991 pre-order level as noted above.

14.  With the exception of Chang Tieh, now Chang Mien, which was excluded from the Taiwanese order.

15.  Based on import data from the U.S. Department of Commerce, the U.S. Treasury, the International Trade Commission, and the domestic interested parties.

16.  The Department recently made a preliminary determination to revoke the order, with respect to Ta Chen, based on de minimis margins in the last three reviews. See Certain Welded Stainless Steel Pipe from Taiwan Certain Welded: Preliminary Results of Antidumping Administrative Review, 64 FR 71728 (December 22, 1999). However, given that Ta Chen waived participation in this sunset proceeding and did not provide any information indicating that a more recently calculated margin would be more appropriate, the Department determined that, consistent with the Sunset Policy Bulletin, the margin calculated in the original investigation is most likely to prevail if the order were revoked.