[Federal Register Volume 61, Number 69 (Tuesday, April 9, 1996)]
[Notices]
[Pages 15766-15769]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-8683]
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DEPARTMENT OF COMMERCE
International Trade Administration
[A-421-805]
Aramid Fiber Formed of Poly Para-Phenylene Terephthalamide From
the Netherlands; Preliminary Results of Antidumping Administrative
Review
AGENCY: Import Administration, International Trade Administration,
Department of Commerce.
ACTION: Notice of preliminary results of the Antidumping Duty
Administrative Review; Aramid Fiber Formed of Poly Para-Phenylene
Terephthalamide from the Netherlands.
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SUMMARY: The Department of Commerce (the Department) is conducting an
administrative review of the antidumping duty order on aramid fiber
formed of poly para-phenylene terephthalamide (PPD-T aramid) from the
Netherlands in response to requests by respondent, Akzo Nobel Fibers
Inc. and Aramid Products V.o.F. (Akzo) and petitioner, E.I. du Pont de
Nemours and Company. This review covers sales of this merchandise to
the United States
[[Page 15767]]
during the period December 16, 1993 through May 31, 1995.
We have preliminarily determined that sales have been made below
normal value (NV). Interested parties are invited to comment on these
preliminary results. Parties who submit argument are requested to
submit with the argument (1) a statement of the issue and (2) a brief
summary of the argument.
EFFECTIVE DATE: April 9, 1996.
FOR FURTHER INFORMATION CONTACT: Donald Little or Maureen Flannery,
Office of Antidumping Compliance, Import Administration, International
Trade Administration, U.S. Department of Commerce, 14th Street and
Constitution Avenue NW., Washington D.C. 20230; telephone (202) 482-
4733.
Applicable Statute
Unless otherwise indicated, all citations to the statute are
references to the provisions effective January 1, 1995, the effective
date of the amendments made to the Tariff Act of 1930 (the Act) by the
Uruguay Round Agreements Act (URAA). In addition, unless otherwise
indicated, all citations to the Department's regulations are to the
current regulations, as amended by the interim regulations published in
the Federal Register on May 11, 1995 (60 FR 25130).
SUPPLEMENTARY INFORMATION:
Background
The Department published in the Federal Register the antidumping
duty order on PPD-T aramid from the Netherlands on June 24, 1994 (59 FR
32678). On June 6, 1995, we published in the Federal Register (60 FR
29821) a notice of opportunity to request an administrative review of
the antidumping duty order on PPD-T aramid from the Netherlands
covering the period December 16, 1993 through May 31, 1995.
In accordance with 19 CFR 353.22(a)(1), Akzo and petitioner
requested that we conduct an administrative review of Akzo's sales. We
published a notice of initiation of this antidumping duty
administrative review on July 14, 1995 (60 FR 36260). The Department is
conducting this administrative review in accordance with section 751 of
the Act.
Scope of Review
The products covered by this review are all forms of PPD-T aramid
from the Netherlands. These consist of PPD-T aramid in the form of
filament yarn (including single and corded), staple fiber, pulp (wet or
dry), spun-laced and spun-bonded nonwovens, chopped fiber and floc.
Tire cord is excluded from the class or kind of merchandise under
review. This merchandise is currently classifiable under the Harmonized
Tariff Schedule (HTS) item numbers 5402.10.3020, 5402.10.3040,
5402.10.6000, 5503.10.1000, 5503.10.9000, 5601.30.0000, and
5603.00.9000. The HTS item numbers are provided for convenience and
Customs purposes. The written description remains dispositive.
This review covers one manufacturer/exporter of PPD-T aramid, Akzo,
and the period December 16, 1993 through May 31, 1995.
Constructed Export Price
The Department based its margin calculation on constructed export
price (CEP), as defined in section 772(b) of the Act, because the
subject merchandise was first sold to unrelated purchasers after import
into the United States.
We based CEP on packed, ex-U.S. warehouse and delivered prices to
unaffiliated purchasers in the United States. The Department made the
following adjustments to prices used to establish CEP, pursuant to
section 772(c) of the Act. The price was increased for repacking
pursuant to section 772(c)(1) and reduced for movement expenses
(international freight, brokerage and handling, U.S. duties, domestic
inland freight and insurance) pursuant to section 772(c)(2). The price
used to establish CEP was also reduced by an amount for the following
expenses incurred in selling the subject merchandise in the United
States pursuant to section 772(d)(1): discounts, rebates, credit,
warranty, technical services, and inventory carrying costs and other
indirect selling expenses. Pursuant to section 772(d)(3), the price was
further reduced by an amount for profit to arrive at the CEP.
Normal Value
In order to determine whether there was a sufficient volume of
sales in the home market to serve as a viable basis for calculating NV,
we compared Akzo's volume of home market sales of the foreign like
product to the volume of U.S. sales of the subject merchandise, in
accordance with section 773(a)(1)(B) of the Act. Because Akzo's
aggregate volume of the home market sales of the foreign like product
was greater than five percent of its aggregate volume of U.S. sales for
the subject merchandise, we determined that the home market provides a
viable basis for calculating NV for Akzo, pursuant to section
773(a)(1)(B) of the Act.
On January 31, and February 7, 1996, petitioner submitted comments
identifying its concerns regarding Akzo's cost calculations. In a
letter dated February 28, 1996, Akzo commented on petitioner's
submissions, and provided explanations for each of petitioner's points.
In order to properly examine the cost issue, we would require that Akzo
provide substantial additional cost information, including data from
the period of investigation. Moreover, we would need time to analyze
and verify this information. Given the above requirements, we have
determined that petitioner did not provide its comments on the issue in
time for the Department to adequately examine the issue in this review.
Cost of Production Analysis
In the less-than-fair-value (LTFV) investigation of Akzo, we
disregarded sales found to be below the cost of production (COP).
Therefore, in accordance with section 773(b)(2)(A)(ii) of the Act, the
Department has reasonable grounds to believe or suspect that sales
below the COP may have occurred during this review period. Thus,
pursuant to section 773(b) of the Act, in this review we initiated a
COP investigation of Akzo.
Before making any fair value comparisons, we conducted the COP
analysis described below.
A. Calculation of COP
We calculated the COP based on the sum of Akzo's cost of materials
and fabrication employed in producing the foreign like product, plus
amounts for home market selling, general, and administrative expenses
(SG&A) and packing costs in accordance with section 773(b)(3) of the
Act. We relied on the home market sales and COP information provided by
Akzo in its questionnaire responses.
B. Test of Home Market Prices
After calculating COP, we tested whether home market sales of PPD-T
aramid were made at prices below COP within an extended period of time
in substantial quantities, and whether such prices permit recovery of
all costs within a reasonable period of time. We compared model-
specific COP to the reported home market prices less any applicable
movement charges, discounts, rebates, and direct and indirect selling
expenses.
C. Results of COP Test
Pursuant to section 773(b)(2)(C), where less than 20 percent of
Akzo's sales of a given model were at prices less than COP, we did not
disregard any
[[Page 15768]]
below-cost sales of that product because we determined that the below-
cost sales were not made in ``substantial quantities.'' Where 20
percent or more of home market sales of a given product were at prices
less than the COP, we disregarded only the below-cost sales where such
sales were found to be made within an extended period of time (in
accordance with section 773(b)(2)(B) of the Act) and at prices which
would not permit recovery of all costs within a reasonable period of
time (in accordance with section 773(b)(2)(D) of the Act). We found
that, for certain types of PPD-T aramid, more than 20 percent of the
home market sales were sold at below-cost prices within the period of
review in substantial quantities. We therefore find that these below-
cost sales were made in substantial quantities within an extended
period of time, and were at prices which did not permit recovery of all
costs within a reasonable period of time. As a result, we excluded
these below cost sales and used the remaining above-cost sales as the
basis of determining NV if such sales existed, in accordance with
section 773(b)(1). For those models of PPD-T aramid for which there
were no above-cost sales available for matching purposes, we compared
CEP to constructed value (CV).
Price-to-Price Comparisons
Pursuant to section 777A(d)(2), we compared the CEPs of individual
transactions to the monthly weighted-average price of sales of the
foreign like product where there was an adequate number of sales at
prices above COP, as discussed above. We based NV on packed, ex-factory
or delivered prices to unaffiliated purchasers in the home market. We
made adjustments, where applicable, in accordance with section
773(a)(6) of the Act. Where applicable, we made adjustments to home
market price for discounts, rebates, inland freight and insurance. To
adjust for differences in circumstances of sale between the home market
and the United States, we reduced home market price by an amount for
home market credit expenses. In order to adjust for differences in
packing between the two markets, we increased home market price by U.S.
packing costs and reduced it by home market packing costs. Prices were
reported net of value added taxes (VAT) and, therefore, no deduction
for VAT was necessary. We made adjustments, where appropriate, for
physical differences in merchandise in accordance with section
773(a)(6)(C)(ii) of the Act.
Level of Trade/CEP Offset
As set forth in section 773(a)(1)(B)(i) of the Act and in the
Statement of Administrative Action (SAA) accompanying the Uruguay Round
Agreements Act, at 829-831, to the extent practicable, the Department
will calculate NV based on sales at the same level of trade as the U.S.
sale. When the Department is unable to find sale(s) in the comparison
market at the same level of trade as in the U.S. sale(s), the
Department may compare sales in the U.S. and foreign markets at a
different level of trade.
In accordance with section 773(a)(7)(A) of the Act, if we compare a
U.S. sale at one level of trade to NV sales at a different level of
trade, the Department will adjust the NV to account for the difference
in level of trade if two conditions are met. First, there must be
differences between the actual selling functions performed by the
seller at the level of trade of the U.S. sale and at the level of trade
of the NV sale. Second, the differences must affect price comparability
as evidenced by a pattern of consistent price differences between sales
at the different levels of trade in the market in which NV is
determined. When CEP is applicable, section 773(a)(7)(B) of the Act
establishes the procedures for making a CEP offset when: (1) NV is at a
different level of trade, and (2) the data available do not provide an
appropriate basis for a level of trade adjustment from the U.S. sale.
Also, in accordance with section 773(a)(7)(B), to qualify for a CEP
offset, the level of trade in the home market must also constitute a
more advanced stage of distribution than the level of trade of the CEP
sale.
Akzo reported one level of trade and one channel of distribution in
the home market (direct to end users/converters). For the U.S. market,
Akzo reported that all sales were made on a CEP basis. The level of
trade of the U.S. sales is determined by the adjusted CEP rather than
the starting price. The adjusted CEP sales do not reflect the selling
functions to end users/converters, such as customer sales contacts,
technical services, and inventory maintenance. The home market sales
reflect these additional selling functions performed for direct sales
to end users/converters. Therefore, the selling functions performed for
CEP sales are sufficiently different than for home market sales to
consider CEP sales and home market sales to be at different levels of
trade.
Because we compared these CEP sales to home market sales at a
different level of trade, we examined whether a level of trade
adjustment may be appropriate. In this case, Akzo only sold at one
level of trade in the home market; therefore, there is no basis upon
which Akzo can demonstrate a consistent pattern of price differences
between levels of trade. Further, we do not have information which
would allow us to examine pricing patterns on Akzo's sales of other
products and there are no other respondents or other record information
on which such an analysis could be based.
Because the data available do not provide an appropriate basis for
making a level of trade adjustment but the level of trade in the home
market is a more advanced stage of distribution than the level of trade
of the CEP sale, a CEP offset is appropriate. Akzo has claimed a CEP
offset. We applied the CEP offset to NV or CV, as appropriate.
We based the CEP offset amount on the amount of the home market
indirect selling expenses. We limited the home market indirect selling
expense deduction by the amount of the indirect selling expenses
incurred on sales to the United States, in accordance with section
772(d)(1)(D).
Constructed Value
In accordance with section 773(e) of the Act, we calculated CV
based on the sum of Akzo's cost of materials and fabrication employed
in producing the subject merchandise, SG&A and profit incurred and
realized in connection with production and sale of the foreign like
product, and U.S. packing costs. In accordance with section
773(e)(2)(A), we based SG&A and profit on the amounts incurred and
realized by Akzo in connection with the production and sale of the
foreign like product in the ordinary course of trade, for consumption
in the foreign country. We used the costs of materials, fabrication,
and G&A as reported in the CV portion of Akzo's questionnaire response.
We used the U.S. packing costs as reported in the U.S. sales portion of
Akzo's questionnaire response. We based selling expenses and profit on
the information reported in the home market sales portion of Akzo's
questionnaire response. See Certain Pasta from Italy; Notice of
Preliminary Determination of Sales at Less Than Fair Value and
Postponement of Final Determination, 61 FR 1344, 1349 (January 19,
1996). For selling expenses, we used the average of above-cost per-unit
home market selling expenses weighted by the total quantity sold. For
actual profit, we first calculated the difference between the home
market sales value and home market COP for all above-cost home market
sales, and divided the sum of these differences by
[[Page 15769]]
the total home market COP for these sales. We then multiplied this
percentage by the COP for each U.S. model to derive an actual profit.
We derived the CEP offset amount from the amount of the indirect
selling expenses on above-cost sales in the home market. We limited the
home market indirect selling expense deduction by the amount of the
indirect selling expenses incurred on sales to the United States.
Preliminary Results of the Review
As a result of our comparison of CEP and NV, we preliminarily
determine that the following weighted-average dumping margin exists:
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Manufacturer/exporter Period Margin
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Akzo...................................... 12/16/93-5/31/95 21.31
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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 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. Parties who submit argument are requested to submit with
the argument (1) a statement of the issue and (2) a brief summary of
the argument. 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. Upon completion
of this review, the Department will issue appraisement instructions
directly to the Customs Service.
Furthermore, the following deposit rates will be effective upon
publication of the final results of this administrative review for all
shipments of PPD-T aramid from the Netherlands entered, or withdrawn
from warehouse, for consumption on or after the publication date, as
provided for by section 751(a)(2)(c) of the Act: (1) The cash deposit
rate for the reviewed company will be the rate established in the final
results of this review; (2) if the exporter is not a firm covered in
this review, or the original 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 (3) for all
other producers and/or exporters of this merchandise, the cash deposit
rate shall be 66.92 percent, the ``all others'' rate established in the
LTFV investigation (59 FR 32678, June 24, 1994).
These deposit rates, when imposed, shall remain in effect until
publication of the final results of the next administrative review.
This notice also 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 the subsequent
assessment of double antidumping duties.
This administrative review and notice are in accordance with
section 751(a)(1) of the Act.
Dated: March 29, 1996.
Susan G. Esserman,
Assistant Secretary, for Import Administration.
[FR Doc. 96-8683 Filed 4-8-96; 8:45 am]
BILLING CODE 3510-DS-P