[Federal Register Volume 59, Number 87 (Friday, May 6, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-10986]


[[Page Unknown]]

[Federal Register: May 6, 1994]


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DEPARTMENT OF COMMERCE
[A-588-807]

 

Industrial Belts and Components and Parts Thereof, Whether Cured 
or Uncured, From Japan; Termination of Circumvention Inquiry of 
Antidumping Duty Order

AGENCY: International Trade Administration, Import Administration, 
Commerce.

ACTION: Notice of termination of circumvention inquiry of antidumping 
duty order.

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SUMMARY: On June 9, 1992, the Department of Commerce (the Department) 
received a request from Brecoflex Corporation (Brecoflex) for a 
circumvention inquiry of the antidumping duty order on industrial belts 
and components and parts thereof, whether cured or uncured, from Japan 
with respect to imports by Mectrol Corporation (Mectrol). Pursuant to 
that request, the Department initiated a circumvention inquiry on 
October 18, 1993 (58 FR 53706). The circumvention inquiry covers the 
period January 1, 1992 through June 30, 1993.
    Based on a review of Brecoflex's submissions in conjunction with 
the International Trade Commission's (ITC) analysis of the 
manufacturing process for production of industrial power belts, the 
Department determines that Brecoflex does not have standing as a 
domestic producer of a like product to file the request in the instant 
inquiry. Therefore, we are terminating the circumvention inquiry.

EFFECTIVE DATE: May 6, 1994.

FOR FURTHER INFORMATION CONTACT:Kimberley Huffman at (202) 482-0780 or 
Wendy Frankel at (202) 482-5253, Office of Antidumping Compliance, 
Import Administration, International Trade Administration, U.S. 
Department of Commerce, 14th and Constitution Avenue, NW., Washington, 
DC 20230.

SUPPLEMENTARY INFORMATION:

Background

    On June 14, 1989, the Department published the antidumping duty 
order on industrial belts and components and parts thereof, whether 
cured or uncured, from Japan (54 FR 25314). On August 4, 1989, we 
published an amended order (54 FR 32104). On June 9, 1992, Brecoflex, 
who identified itself as a producer of a like product in the United 
States, alleged that the antidumping duty order on industrial belts 
from Japan was being circumvented and requested that the Department 
investigate the matter. The Department initiated a circumvention 
inquiry on October 18, 1993.
    In several submissions, Mectrol alleged that Brecoflex did not have 
standing to file a request for a circumvention inquiry. Therefore, on 
February 1, 1994, and February 28, 1994, the Department issued a 
standing questionnaire and supplemental standing questionnaire, 
respectively, to Brecoflex. Brecoflex responded to the standing 
questionnaires on February 17, 1994, and March 4, 1994.

Analysis

Standing To File a Request for a Circumvention Inquiry

    Section 353.29 of the Department's regulations states that ``[a]ny 
interested party, as defined in Sec. 353.2(k), may file'' a request for 
a circumvention inquiry (19 CFR 353.29). In its June 9, 1993, request 
for a circumvention inquiry, Brecoflex claimed standing to bring the 
request as a domestic producer of industrial power belts. The provision 
in the Department's regulations for standing as a producer is 
Sec. 353.2(k)(3) which includes in the definition of interested party 
``[a] producer in the United States of the like product'' (19 CFR 
353.2(k)(3)).

Brecoflex's U.S. Operations

    In its June 9, 1992, request for a circumvention inquiry, Brecoflex 
claimed standing to bring the request as a producer in the United 
States of a like product as covered by the antidumping duty order on 
industrial belts from Japan. Pursuant to questions raised by Mectrol 
concerning Brecoflex's standing to bring this request for a 
circumvention inquiry, the Department issued a standing questionnaire 
to Brecoflex. In its standing questionnaire response, Brecoflex 
explained its U.S. operations as follows.
    Brecoflex states that it imports from Germany polyurethane timing 
belts and performs secondary operations on these belts in its only 
United States facility in Eatontown, New Jersey. The secondary 
operations consist of the following:

(1) Slitting of roll stock and truly endless belts to narrower belt 
widths;
(2) Cutting roll stock to specific lengths;
(3) Splicing and welding of open-ended roll stock to finished belts;
(4) Attaching injection molded profiles to belt backs; and
(5) Machining of finished belts such as edge grinding, removing 
sections of teeth, providing holes for joining belts in linear drives, 
and grinding of belt back.

    Brecoflex states that it fabricates, markets and sells three basic 
types of synchronous polyurethane timing belts that it considers to be 
subject merchandise. These belts include the Breco M, the Breco V, and 
the Brecoflex. Brecoflex performs the operations listed above on these 
three belts. (See the Department's April 15, 1994, Recommendation 
Memorandum for further detail.)

Production of Industrial Power Belts

    In its final report during the injury investigation in 1989, the 
ITC determined that there are four main stages in the manufacturing of 
industrial power transmission belts:
    (1) Parts manufacturing,
    (2) Assembling or building,
    (3) Curing or vulcanizing, and
    (4) Finishing and packaging (see Industrial Belts from Japan, USITC 
Pub. 2194 (1989) (ITC Report) at 6 and 7). In addition, the ITC Report 
describes the three main components of most industrial power belts: (1) 
A tensile member (a textile, fiberglass, or steel cord, yarn, or 
fabric), which adds strength to withstand the tension imposed in 
transmitting power;
    (2) The base material (usually synthetic rubber, such as neoprene 
or plastics), which forms the bulk of the belt and encloses the tensile 
member, and is referred to as the undercord and the overcord; and
    (3) Adhesion material or gum, which bonds all the components 
together (USITC Pub. 2194 at a-2).
    As discussed above, Brecoflex either sells the German belts as 
imported, or performs secondary operations on the belts in preparation 
for sale. We determine that these secondary operations listed above do 
not add to the material composition of the belts or fundamentally alter 
the essential nature of the merchandise as imported. Specifically, the 
merchandise as imported already incorporates the three main components 
of industrial belts as described in the ITC Report. Furthermore, the 
belting stock as imported has already undergone, before arrival in the 
United States, the first three stages of the belt manufacturing process 
as described in the ITC Report.
    As Brecoflex indicated in its request for a circumvention inquiry, 
the major cost in producing timing belts is incurred in production of 
the belt stock from which the finished belts are made. As Brecoflex 
itself explained, completion of a finished belt from belt stock 
requires merely slitting to width, cutting to length, and possibly die 
cutting to length and welding. According to Brecoflex, these 
operations--the same secondary operations that Brecoflex performs in 
its U.S. facility--involve some skilled labor but little in the way of 
machinery or capital investment. Thus, as indicated in its submissions, 
Brecoflex performs only secondary operations in its U.S. facility, all 
of which fall within the fourth stage of the belt manufacturing process 
as described in the ITC Report, i.e., finishing and packaging. 
Brecoflex also markets and services the imported roll stock it sells in 
the United States.
    Based on the above analysis and the information submitted by 
Brecoflex, the Department determines that Brecoflex is not a domestic 
producer of industrial belts and, therefore, is not an interested party 
within the meaning of 19 CFR 353.2(k)(3) entitled to file a request for 
a circumvention inquiry. As such, the Department determines that 
Brecoflex does not have standing to file a request for a circumvention 
inquiry against Mectrol.

Conclusion

    Because Brecoflex Corporation is not a producer of industrial power 
belts in the United States and, therefore, does not have standing under 
19 CFR 353.2(k) to file a request for a circumvention inquiry with 
regard to the antidumping duty order on industrial belts and components 
and parts thereof, whether cured or uncured, from Japan, the Department 
hereby terminates this circumvention inquiry.

    Dated: April 27, 1994.
Susan G. Esserman,
Assistant Secretary for Import Administration.
[FR Doc. 94-10986 Filed 5-5-94; 8:45 am]
BILLING CODE 3510-DS-M