[Federal Register Volume 59, Number 94 (Tuesday, May 17, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-11965]


[[Page Unknown]]

[Federal Register: May 17, 1994]


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DEPARTMENT OF COMMERCE
[A-580-806]

 

Sweaters Wholly or in Chief Weight of Man-Made Fiber From Korea; 
Preliminary Results of Antidumping Duty Administrative Review

AGENCY: International Trade Administration/Import Administration, 
Department of Commerce.

ACTION: Notice of Preliminary Results of Antidumping Duty 
Administrative Review.

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SUMMARY: In response to a request by members of the domestic industry, 
the Department of Commerce is conducting an administrative review of 
the antidumping duty order on sweaters wholly or in chief weight of 
man-made fiber from Korea. The review covers six manufacturers/
exporters of this merchandise to the United States and the period 
September 1, 1991 through August 31, 1992. As a result of this review, 
we have preliminarily determined to assess antidumping duties equal to 
the difference between United States price and foreign market value.
    Interested parties are invited to comment on these preliminary 
results.

EFFECTIVE DATE: May 17, 1994.

FOR FURTHER INFORMATION CONTACT: Rebecca Collins, Nooshen Amiri, Donald 
Little, or G. Leon McNeill, Office of Antidumping Compliance, 
International Trade Administration, U.S. Department of Commerce, 14th 
Street and Constitution Avenue, NW., Washington, DC 20230; telephone: 
(202) 482-4733.

SUPPLEMENTARY INFORMATION:

Background

    On September 24, 1990, the Department of Commerce (the Department) 
published in the Federal Register (55 FR 39036) the antidumping duty 
order on sweaters wholly or in chief weight of man-made fiber (MMF 
sweaters) from Korea. On September 30, 1992, the petitioner, the 
National Knitwear & Sportswear Association, and the Emergency Ad Hoc 
Committee of Man-Made Fiber Sweater Producers and its individual member 
producers, requested that we conduct an administrative review, in 
accordance with 19 CFR 353.22(a). We published the notice of initiation 
of the antidumping duty administrative review on October 22, 1992 (57 
FR 48201), covering the period September 1, 1991 through August 31, 
1992. The Department has now conducted the review in accordance with 
section 751 of the Tariff Act of 1930, as amended (the Tariff Act).

Scope of the Review

    Imports covered by this review are shipments of MMF sweaters from 
Korea. MMF sweaters are defined as garments for outerwear that are 
knitted or crocheted, in a variety of forms including jacket, vest, 
cardigan with button or zipper front, or pullover, usually having 
ribbing around the neck, bottom, and cuffs on the sleeves (if any), 
encompassing garments of various lengths, wholly or in chief weight of 
man-made fiber. The term ``in chief weight of man-made fiber'' includes 
sweaters where the man-made fiber material predominates by weight over 
each other single textile material. This term excludes sweaters 23 
percent or more by weight of wool. It includes men's, women's, boys', 
or girls' sweaters, as defined above, but does not include sweaters for 
infants 24 months of age or younger. It includes all sweaters as 
defined above, regardless of the number of stitches per centimeter, 
provided that, with regard to sweaters having more than nine stitches 
per two linear centimeters horizontally, it includes only those with a 
knit-on rib at the bottom.
    Garments which extend below mid-thigh or cardigans that contain a 
sherpa lining or heavy-weight fiberfill lining, including quilted 
linings, used to provide extra warmth to the wearer, are not considered 
sweaters and are excluded from the scope of the review. Also 
specifically excluded from the scope are sweaters assembled in Guam 
that are produced from knit-to-shape component parts knit in and 
imported from Korea and entering under Harmonized Tariff Schedule (HTS) 
item number 9902.61.
    The subject merchandise is currently classifiable under HTS item 
numbers 6110.30.30.10, 6110.30.30.15, 6110.30.30.20, 6110.30.30.25, 
6103.23.00.70, 6103.29.10.40, 6103.29.20.62, 6104.23.00.40, 
6104.29.10.60, 6104.29.20.60, 6110.30.10.10, 6110.30.10.20, 
6110.30.20.10, and 6110.30.20.20. This merchandise may also enter under 
HTS item numbers 6110.30.30.50 and 6110.30.30.55. The HTS item numbers 
are provided for convenience and Customs purposes only. The written 
description remains dispositive.
    This review covers six manufacturers/exporters of the subject 
merchandise from Korea, Chunji Industrial Company, Ltd. and its related 
company, Sungwha Garment Company, Ltd. (collectively, Chunji), Hanil 
Synthetic Fiber Industrial Company, Ltd. (Hanil), Jo Woo Company Ltd. 
(Jo Woo), Shinwon Corporation (Shinwon), Young Woo & Company, Ltd. 
(Young Woo), and Yurim Company, Ltd. (Yurim), and the period September 
1, 1991 through August 31, 1992.

United States Price

    The Department used purchase price (PP), as defined in section 772 
of the Tariff Act, in calculating United States price (U.S. price). PP 
was based on the packed, f.o.b. price to the first unrelated purchasers 
in the United States. We made deductions, where appropriate, for 
foreign inland freight, foreign brokerage and handling, U.S. duty, 
marine insurance, demurrage, wharfage, and containerization charges. We 
also made an addition for import duties which were rebated on imported 
materials used to produce subsequently exported merchandise.
    No other adjustments were claimed or allowed.
    Hanil, Jo Woo, Shinwon and Young Woo did not include their U.S. 
sample sales and resales in their U.S. sales databases, nor did they 
include expense and cost data for these sample sales and resales. For 
these U.S. sales, we have used the best information available (BIA). 
Since record evidence does not support the proposition that it would 
have been impossible for each company to report expense and cost data 
for these sales, we have used an uncooperative rate as BIA. The 
uncooperative rate used is (1) the highest of the rates found for any 
firm in the less-than-fair-value (LTFV) investigation or in prior 
administrative reviews, or (2) the highest rate found in this review 
for any firm. See Final Results of Antidumping Duty Administrative 
Reviews and Revocation in Part of an Antidumping Duty Order; 
Antifriction Bearings (Other Than Tapered Roller Bearings) and Parts 
Thereof from France, Germany, Italy, Japan, Romania, Singapore, Sweden, 
Thailand and the United Kingdom (59 FR 39729, July 26, 1993).

Foreign Market Value

    In order to determine whether there were sufficient sales of MMF 
sweaters in the home market to serve as a viable basis for calculating 
foreign market value (FMV), we compared the volume of home market sales 
to the volume of third country sales in accordance with section 
773(a)(1)(B) of the Tariff Act. All respondents had insufficient home 
market sales of the subject merchandise during the period of review. 
Therefore, in accordance with 19 CFR 353.48(a), we used third-country 
sales or constructed value (CV) as the basis for calculating FMV.
    During the LTFV investigation and the first administrative review 
of this case, the Department found that Chunji, Hanil, Shinwon, Young 
Woo, and Yurim had made third-country sales of subject merchandise at 
prices which were below the cost of production. Accordingly, for this 
review, we initiated an investigation of possible third-country sales 
below the cost of production for these companies.
    As a result of our investigations, we found below-cost sales for 
Chunji, Hanil, Shinwon, Young Woo, and Yurim. When between 10 and 90 
percent of the sales of a particular model were determined to be below 
the cost of production, and below-cost sales were made over an extended 
period of time, we excluded those sales from our calculation of FMV. 
When more than 90 percent of the sales of a particular model were made 
below cost and below-cost sales were made over an extended period of 
time, we excluded all sales of that model from our calculation of FMV. 
When less than 10 percent of the home market sales of a particular 
model were made at prices below the cost of production, we did not 
disregard any sales of that model.
    To determine if sales below cost had been made over an extended 
period of time, we compared the number of months in which sales below 
cost had occurred for a particular model to the number of months in 
which the model was sold. If the model was sold in three or fewer 
months, we did not find that below-cost sales were made over an 
extended period of time unless there were sales below cost of that 
model in each month. If a model was sold in more than three months, we 
did not find that below-cost sales were made over an extended period of 
time unless there were sales below cost in at least three of the months 
in which the model was sold.
    Since none of the respondents has submitted information indicating 
that any of its sales below cost were at prices which would have 
permitted ``recovery of all costs within a reasonable period of time in 
the normal course of trade,'' within the meaning of section 773(b)(2) 
of the Tariff Act, we were unable to conclude that the costs of 
production of such sales were recovered within a reasonable period. As 
a result, we disregarded below-cost sales when the conditions as 
described above were met.
    In determining such or most similar merchandise for these 
preliminary results, when there was more than one equally similar 
model, in accordance with our model matching criteria as set out in 
Appendix V of our questionnaire, we used the pool of equally similar 
third-country models, as long as the costs of those models were within 
20 percent of the cost of the U.S. model. When there was more than one 
equally similar above-cost model, we adjusted the FMV of each model for 
differences in merchandise, and then weight averaged the results. If 
any of these models were found to be below cost, we excluded them from 
our analysis and used only the above-cost models. If there were not 
sufficient sales of such or most similar merchandise made at or above 
the cost of production, we used CV for calculating FMV.
    Third-country price was based on the packed, f.o.b., c.i.f., or C&F 
price to the first unrelated purchaser. We made adjustments, where 
applicable, to the third-country price for foreign inland freight, 
foreign brokerage and handling, bank charges, quota and Customs 
clearance fee, wharfage and containerization, ocean freight, marine 
insurance, credit expenses, warranties, commissions, differences in the 
physical characteristics of the merchandise, and differences in 
packing. We also added an amount for import duties which were rebated 
on imported materials used to produce subsequently exported 
merchandise. Since FMV was compared to PP, we added U.S. credit, 
warranties, and commissions to FMV, as appropriate. When commissions 
were paid on either the PP sale or the third-country sale but not on 
the other, we made an adjustment to FMV for indirect selling expenses 
in the one market to offset the commissions in the other market. See 19 
CFR 353.56(b). That is, when there was a commission on the PP sale but 
not on the third-country sale, we added the U.S. commission to FMV, and 
subtracted third-country indirect selling expenses from FMV, up to the 
amount of the U.S. commission. When there was a commission on the 
third-country sale but not on the PP sale, we subtracted the third-
country commission from FMV, and added U.S. indirect selling expenses 
to FMV, up to the amount of the third-country commission. When 
commissions were paid in both markets, we deducted the third-country 
commissions from FMV and added the U.S. commissions to FMV.
    CV includes materials, fabrication, general expenses, profit, and 
packing. We used: (1) Actual general expenses or the statutory minimum 
of 10 percent of materials and fabrication, whichever was greater; (2) 
actual profit or the statutory minimum of 8 percent of materials and 
fabrication costs and general expenses, whichever was greater; and (3) 
packing costs for merchandise exported to the United States. Where 
appropriate, we made adjustments for differences in circumstances of 
sale, in accordance with 19 CFR 353.56.
    No other adjustments were claimed or allowed.
    Hanil and Yurim did not provide cost of production data for third-
country models sold as sample sales or as resales. In these instances, 
we excluded the third-country model from the cost-of-production test, 
and, therefore, from the pool of third-country sales used to calculate 
FMV. If a third-country model sold as a sample sale or a resale for 
which cost of production data were not reported was selected as the 
only most similar model for a U.S. model, we used CV as the basis of 
FMV.
    Chunji and Yurim included in their U.S. sales databases data on 
their U.S. sample sales and resales and selected the most similar 
third-country merchandise for these models, but did not provide CV data 
for these U.S. models. Therefore, when there were no sales of such or 
most similar merchandise made at or above the cost of production, or 
such or most similar merchandise could not be found, the Department had 
no data to use as the basis of FMV. For these U.S. sample sales and 
resales, the Department used BIA. As BIA, we used an uncooperative 
rate, as described above, since record evidence does not support the 
proposition that it would have been impossible to provide these data.

Preliminary Results of Review

    As a result of our review, we preliminarily determine that the 
following margins exist: 

------------------------------------------------------------------------
                                                                Margin  
        Manufacturer/exporter            Period of review     (percent) 
------------------------------------------------------------------------
Chunji Industrial Company, Ltd and                                      
 Sungwha Garment Company, Ltd........     09/01/91-08/31/92         2.75
Hanil Synthetic Fiber Ind. Co., Ltd..     09/01/91-08/31/92         2.51
Jo Woo Company, Ltd..................     09/01/91-08/31/92         4.12
Shinwon Corporation..................     09/01/91-08/31/92         2.06
Young Woo & Company, Ltd.............     09/01/91-08/31/92         4.88
Yurim Company, Ltd...................     09/01/91-08/31/92         4.10
------------------------------------------------------------------------

    Parties to the proceeding may request disclosure within 5 days of 
the date of publication of this notice. Any interested party may 
request a hearing within 10 days of publication. Any hearing, if 
requested, will be held 44 days after the date of publication of this 
notice, or the first workday thereafter. Interested parties may submit 
case briefs within 30 days of the date of publication of this notice. 
Rebuttal briefs, which must be limited to issues raised in the case 
briefs, may be filed not later than 37 days after the date of 
publication. See 19 CFR 353.38. The Department will publish a notice of 
final results of this administrative review, which will include the 
results of its analysis of issues raised in any such comments.
    The Department shall determine, and the Customs Service shall 
assess, antidumping duties on all appropriate entries. Individual 
differences between U.S. price and FMV may vary from the percentages 
stated above. The Department will issue appraisement instructions on 
each exporter directly to the Customs Service.
    Furthermore, the following deposit requirements will be effective 
upon publication of the final results of this administrative review for 
all shipments of MMF sweaters from Korea entered, or withdrawn from 
warehouse, for consumption on or after the publication date, as 
provided by section 751(a)(1) of the Tariff Act: (1) The cash deposit 
rates for the reviewed companies will be those established in the final 
results of this administrative review; (2) for previously reviewed or 
investigated companies not listed above, the cash deposit rate 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 
LTFV investigation, but the manufacturer is, the cash deposit rate will 
be the rate established for the most recent period for the manufacturer 
of the merchandise; and (4) the cash deposit rate for all other 
manufacturers or exporters will be the ``all others'' rate established 
in the final notice of LTFV investigation of this case, in accordance 
with the Court of International Trade's decisions in Floral Trade 
Council v. United States, 822 F.Supp. 766 (1993), and Federal-Mogul 
Corporation and the Torrington Company v. United States, 39 F.Supp. 864 
(1993). The all others rate is 1.30 percent. These deposit 
requirements, when imposed, shall remain in effect until publication of 
the final results of the next administrative review.

Notification of Interested Parties

    This notice serves as a preliminary 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 subsequent assessment 
of double antidumping duties.
    This notice also serves as a reminder to parties subject to 
administrative protective orders (APOs) of their responsibility 
concerning the return or destruction of proprietary information 
disclosed under APO in accordance with 19 CFR 353.34(d). Timely written 
notification of the 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.


    Dated: May 10, 1994.
Paul L. Joffe,
Deputy Assistant Secretary for Import Administration.
[FR Doc. 94-11965 Filed 5-16-94; 8:45 am]
BILLING CODE 3510-DS-P