[Federal Register Volume 61, Number 173 (Thursday, September 5, 1996)]
[Notices]
[Pages 46776-46779]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-22680]


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DEPARTMENT OF COMMERCE
[A-351-806]


Silicon Metal From Brazil; Preliminary Results of Antidumping 
Duty Administrative Review, Intent To Revoke in Part, and Intent Not To 
Revoke in Part

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

ACTION: Notice of preliminary results of antidumping duty 
administrative review, intent to revoke in part, and intent not to 
revoke in part.

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SUMMARY: In response to requests from petitioners and five respondents, 
the Department of Commerce (the Department) has conducted an 
administrative review of the antidumping duty order on silicon metal 
from Brazil. This review covers five manufacturers/exporters and the 
period July 1, 1993, through June 30, 1994. The review indicates that 
one of the companies had a margin during the period of review, and that 
three of the companies had no margins during the period for review. Our 
review also indicates that one company had no shipments during the 
period of review.
    We intend to revoke the order for Companhia Ferroligas Minas 
Gerasis--Minasligas (Minasligas). We have preliminarily determined that 
Minasligas has not sold the subject merchandise at less than foreign 
market value (FMV) in this review and for at least three consecutive 
administrative review periods, and that it is not likely that 
Minasligas will sell the subject merchandise at less than FMV in the 
future. Minasligas has also submitted a certification that it will not 
sell to the United States at less than FMV in the future, and has 
agreed in writing to its immediate reinstatement in the order if the 
Secretary concludes under 19 CFR Sec. 353.22(f) that subsequent to 
revocation Minasligas sold the merchandise at less than FMV.
    We do not intend to revoke the order with respect to Companhia 
Brasileira Carbureto de Calcio (CBCC). CBCC submitted an untimely 
request for revocation. Furthermore, in the final results of our most 
recently completed administrative review of this order, CBCC had a 
margin that was greater than de minimis. Therefore, CBCC does not 
qualify for revocation.
    We have preliminarily determined that sales have been made below 
the FMV for one company. If these preliminary results are adopted in 
our final results of administrative review, we will instruct U.S. 
Customs to assess antidumping duties equal to the difference between 
United States price (USP) and the FMV.
    Interested parties are invited to comment on these preliminary 
results. Parties who submit argument in this proceeding are requested 
to submit with the argument (1) a statement of the issue and (2) a 
brief summary of the argument.

EFFECTIVE DATE: September 5, 1996.

FOR FURTHER INFORMATION CONTACT:
Fred Baker or John Kugelman, Import Administration, International Trade 
Administration, U.S. Department of Commerce, 14th Street and 
Constitution Avenue, NW., Washington, DC 20230; telephone: (202) 482-
5253.
    Applicable Statute: Unless otherwise indicated, all citations to 
the statute and to the Department's regulations are in reference to the 
provisions as they existed on December 31, 1994.

SUPPLEMENTARY INFORMATION:

Background

    On July 31, 1991, the Department published in the Federal Register 
(56 FR 36135) the antidumping duty order on silicon metal from Brazil. 
On July 1, 1994, the Department published (59 FR 33951) a notice of 
``Opportunity to Request an Administrative Review'' of this antidumping 
duty order for the period July 1, 1993, through June 30, 1994. We 
received timely requests for review from CBCC, Minasligas, Eletrosilex 
Belo Horizonte (Eletrosilex), Rima Industrial S.A. (RIMA), and Camargo 
Correa Metais S.A. (CCM). We also received a request for review of the 
same five manufacturers/exporters of

[[Page 46777]]

silicon metal from a group of four domestic producers of silicon metal 
(the petitioners). The four domestic producers are American Silicon 
Technologies, Elkem Metals Co., Globe Metallurgical, Inc., and SKW 
Metals and Alloys, Inc.
    On August 24, 1994, the Department published a notice of initiation 
(59 FR 43537) covering the five manufacturers/exporters named above.
    The Department has now completed the preliminary results of this 
review in accordance with section 751 of the Tariff Act of 1930, as 
amended (the Tariff Act).
    In accordance with 19 CFR 353.25(a) we have preliminarily 
determined to revoke the antidumping duty order for Minasligas. 
Minasligas submitted a request in accordance with 19 CFR 353.25(b) to 
revoke the order with respect to its sales of silicon metal in the 
United States. Minasligas's request was accompanied by the required 
certifications which state that it has not sold silicon metal in the 
United States at less than FMV for at least three consecutive years, 
including the subject review period, and that it will not do so in the 
future. Minasligas has also agreed in writing to its immediate 
reinstatement in the order if the Secretary concludes under 19 CFR 
Sec. 353.22(f) that subsequent to revocation Minasligas sold the 
merchandise at less than FMV. Since we preliminarily determine that 
Minasligas has not sold the subject merchandise at less than FMV for at 
least three consecutive years, and because we believe that it is not 
likely that Minasligas will sell the subject merchandise at less than 
FMV in the future, we intend to revoke the order with respect to 
Minasligas.
    In response to the Department's request for information RIMA 
submitted to the Department a list of U.S. sales made during the POR. 
However, based upon information from U.S. Customs, we have determined 
that none of RIMA's U.S. sales made during this POR entered U.S. 
customs territory during the POR. Therefore, we have determined to 
treat RIMA as a non-shipper for this review.

Scope of the Review

    The merchandise covered by this review is silicon metal from Brazil 
containing at least 96.00 percent but less than 99.99 percent silicon 
by weight. Also covered by this review is silicon metal from Brazil 
containing between 89.00 and 96.00 percent silicon by weight but which 
contains a higher aluminum content than the silicon metal containing at 
least 96.00 percent but less than 99.99 percent silicon by weight. 
Silicon metal is currently provided for under subheadings 2804.69.10 
and 2804.69.50 of the Harmonized Tariff Schedule (HTS) as a chemical 
product, but is commonly referred to as a metal. Semiconductor grade 
silicon (silicon metal containing by weight not less than 99.99 percent 
silicon and provided for in subheading 2804.61.00 of the HTS) is not 
subject to the order. HTS item numbers are provided for convenience and 
for U.S. Customs purposes. The written description remains dispositive 
as to the scope of product coverage.
    The review period is July 1, 1993, through June 30, 1994. This 
review involves five manufacturers/exporters of Brazilian silicon 
metal.

Use of Best Information Available (BIA)

    Because CBCC failed to produce information requested at 
verification to substantiate significant portions of its response, in 
accordance with section 776(c) of the Act, we have preliminarily 
determined that the use of BIA is appropriate. For these preliminary 
results we applied the following two-tier BIA analysis in choosing what 
to apply as BIA:

    1. When a company refuses to cooperate with the Department or 
otherwise significantly impedes these proceedings, it assigns that 
company first-tier BIA, which is the higher of:
    (a) The highest of the rates found for any firm for the same 
class or kind of merchandise in the same country of origin in the 
less-than-fair-value investigation (LTFV) or prior administrative 
review; or
    (b) The highest rate found in the present administrative review 
for any firm for the same class or kind of merchandise from the same 
country or origin.
    2. When a company substantially cooperates with our requests for 
information including, in some cases, verification, but fails to 
provide the information requested in a timely manner or in the form 
required, it assigns to that company second-tier BIA, which is the 
higher of:
    (a) The firm's highest rate (including the ``all others'' rate) 
of the same class or kind of merchandise from a prior administrative 
review or, if the firm has never before been investigated or 
reviewed, the all others rate from the LTFV investigation; or
    (b) The highest calculated rate in this review for the class or 
kind of merchandise for any firm from the same country of origin.

See Allied-Signal Aerospace Co. v. United States, 28 F.3d 1188, 1189, 
1190 n.2 (CAFC 1994).
    CBCC cooperated with the Department by responding to the 
Department's questionnaires. However, we determined at verification 
that this company could not substantiate significant portions of its 
responses. Therefore, we have determined to apply second-tier BIA to 
CBCC for those sales for which we were unable to verify sales or cost 
information. (See Use of BIA memorandum to Joseph Spetrini, Deputy 
Assistant Secretary, Enforcement Group Three.) The second-tier BIA rate 
we have assigned to CBCC is 87.79 percent. This rate is CBCC's rate 
from the LTFV investigation. Accordingly, the rate we have assigned to 
CBCC for this review reflects the weighted-average rate for those sales 
for which we did not apply BIA and those sales for which we did apply 
BIA.

Verification

    As provided in section 776(b) of the Tariff Act, we verified 
information provided by Minasligas, CCM, RIMA, and CBCC by using 
standard verification procedures, including onsite inspection of the 
manufacturers' facilities, the examination of relevant sales and 
financial records, and selection of original documentation containing 
relevant information. Our verification results are outlined in the 
public versions of the verification reports.

United States Price

    In calculating USP, we used purchase price as defined in section 
772 of the Tariff Act. Purchase price was based on the packed, F.O.B. 
or C&F price to the first unrelated purchaser in the United States.
    We made deductions from USP, where appropriate, for foreign inland 
freight, ocean freight, foreign inland insurance, brokerage and 
handling, and export taxes. We made an addition to USP, where 
appropriate, for duty drawback. These adjustments were in accordance 
with section 772(d)(2) of the Tariff Act. We also adjusted USP for 
taxes in accordance with our practice as outlined in the final results 
of the second administrative review of this case published concurrently 
with this notice.
    No other adjustments were claimed or allowed.

Foreign Market Value (FMV)

    In order to determine whether there were sufficient sales of 
silicon metal in the home market to serve as a viable basis for 
calculating FMV, we compared the volume of each respondent's home 
market sales to the volume of its third-country sales, in accordance 
with section 773(a)(1)(B) of the Tariff Act. In each case we found that 
the respondent's sales of silicon metal in the home market constituted 
at least five percent of its sales to third-country markets. Thus, we 
based FMV on sales in the home market. See 19 C.F.R. 353.46(a).

[[Page 46778]]

    Due to the existence of sales below the cost of production (COP) in 
the last completed review of Eletrosilex, Minasligas, and CBCC, and the 
LTFV investigation of CCM, the Department determined that it had 
reasonable grounds to believe or suspect that sales below the COP may 
have occurred during this review. Accordingly, the Department initiated 
a COP investigation to determine whether Eletrosilex, Minasligas, CBCC, 
and CCM made sales during the POR at prices below their respective cost 
of productions within the meaning of section 773(b) of the Act.

Calculation of COP

    We calculated each respondent's COP based on the sum of each 
respondent's reported cost of materials, fabrication, selling, general, 
and administrative (SG&A) expenses, and home market packing expenses in 
accordance with 19 CFR 353.51(c). We made an adjustment to COP, where 
applicable, for revenue received from the sale of by-products produced 
while producing silicon metal. Because the Brazilian economy was 
hyperinflationary during the period of review (POR), we instructed 
respondents to follow our longstanding methodology for 
hyperinflationary economies, including the use of replacement costs. 
(See Silicon Metal from Brazil, Final Results of Antidumping Duty 
Administrative Review, 59 FR 42806 (August 19, 1994).)
    After calculating COP, we tested whether, as required by section 
773(b) of the Act, the respondent's home market sales of subject 
merchandise were made at price below COP, over an extended period of 
time in substantial quantities, and whether such sales were made at 
prices which permit recovery of all costs within a reasonable period of 
time in the normal course of trade. On a model-specific basis, we 
compared monthly COPs to the reported home market prices. To satisfy 
the requirement of section 773(b)(1) of the Act that below-cost sales 
be disregarded only if made in substantial quantities, we applied the 
following methodology. If over 90 percent of the respondent's sales of 
a given product were at prices equal to or greater than the COP, we did 
not disregard any below-cost sales of that product because we 
determined that the below-cost sales were not made in ``substantial 
quantities.'' If between ten and 90 percent of the respondent's sales 
of a given product were at prices equal to or greater than the COP, we 
disregarded only the below-cost sales, provided sales of that product 
were also found to be made over an extended period of time. Where we 
found that more than 90 percent of the respondent's sales of a product 
were at prices below the COP, and the sales were made over an extended 
period of time, we disregarded all sales of that product, and 
calculated FMV based on CV, in accordance with section 773(b) of the 
Act.
    In accordance with section 773(b)(1) of the Act, in order to 
determine whether below-cost sales had been made over an extended 
period of time, we compared the number of months in which below-cost 
sales occurred for each product to the number of months in the POR in 
which that product was sold. If a product was sold in three or more 
months of the POR, we did not exclude below-cost sales unless there 
were below-cost sales in at least three months during the POR. When we 
found that sales of a product occurred in only one or two months, the 
number of months in which the sales occurred constituted the extended 
period of time, i.e., where sales of a product were made in only two 
months, the extended period of time was two months; where sales of a 
product were made in only one month, the extended period of time was 
one month. See Final Determination of Sales at Less Than Fair Value: 
Certain Carbon Steel Butt-Weld Pipe Fittings from the United Kingdom, 
60 FR 10558, 10560 (February 27, 1995).
    For CBCC, Minasligas, Eletrosilex, and CCM, we found that, for 
certain models, between 10 and 90 percent of home market sales were 
made at below-COP prices. Since CBCC, Minasligas, Eletrosilex, and CCM 
provided no indication that these sales were at prices that would 
permit recovery of all costs within a reasonable period of time and in 
the normal course of trade, we disregarded the below-cost sales of 
those models, if those sales were made over an extended period of time. 
See 19 CFR Sec. 353.50.
    Other than where we used BIA for CBCC, we based FMV for CBCC on 
constructed value (CV). In accordance with section 773(e) of the Tariff 
Act, it consisted of the sum of the cost of manufacture (COM) of 
silicom metal, home market SG&A expenses, home market profit, and the 
cost of export packing. The COM of silicon metal is the sum of direct 
material, direct labor, and variable and fixed overhead expenses. For 
home market SG&A expenses, we used the larger of the actual SG&A 
expenses reported by CBCC or 10 percent of the COM, the statutory 
minimum for general expenses. For home market profit we used the larger 
of the actual profit reported by CBCC, or the statutory minimum of 
eight percent of the sum of COM and SG&A expenses. See section 
773(e)(1)(B) of the Tariff Act. We also made adjustments, where 
applicable, for differences between direct selling expenses incurred in 
the home market and the U.S. market. These direct selling expenses 
consisted of credit and warehousing. Finally, we made a circumstance-
of-sale inflation adjustment as we did in the final results of the 
second administrative review of this proceeding, published concurrently 
with this notice.
    We based FMV for Minasligas, Eletrosilex, and CCM on prices to 
unrelated purchasers in the home market. We calculated a monthly, 
weighted-average price. Where applicable, we made adjustments for post-
sale inland freight. We also made adjustments, where applicable, for 
differences between home market and U.S. expenses for packing, credit, 
and warehousing.
    No other adjustments were claimed or allowed.

Preliminary Results of Review

    As a result of our review, we preliminarily determine that the 
following margins exist for the period July 1, 1993, through June 30, 
1994:

------------------------------------------------------------------------
                                                                Margin  
                    Manufacturer/exporter                      (percent)
------------------------------------------------------------------------
CBCC........................................................       57.32
Minasligas..................................................        0.00
Eletrosilex.................................................        0.00
RIMA........................................................    \1\31.60
CCM.........................................................        9.29
------------------------------------------------------------------------
\1\ No shipments during the POR; rate is from last review in which there
  were shipments.                                                       

    Interested parties may request a disclosure within 5 days of 
publication of this notice and may request a hearing within 10 days of 
the date of publication. Any hearing, if requested, will be held 44 
days after the date of publication, or the first workday thereafter. 
Interested parties may submit case briefs within 30 days of the date of 
publication. Rebuttal briefs, limited to issues raised in the case 
briefs, may be filed not later than 37 days after the date of 
publication. The Department will publish a notice of the final results 
of this administrative review, which will include the results of its 
analysis of issues raised in any such case briefs or at a hearing.
    The Department shall determine, and the Customs Service shall 
assess, antidumping duties on all appropriate entries. Individual 
differences between USP and FMV may vary from the percentages stated 
above. The Department will issue appraisement

[[Page 46779]]

instructions directly to the Customs Service.
    Furthermore, the following deposit requirements will be effective 
for all shipments of silicon metal from Brazil entered, or withdrawn 
from warehouse, for consumption on or after the publication date of the 
final results of this administrative review, as provided by section 
751(a)(1) of the Tariff Act: (1) The cash deposit rates for the 
reviewed companies will be those rates established in the final results 
of this 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, a prior 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 (4) if neither the exporter nor 
the manufacturer is a firm covered in this or any previous review 
conducted by the Department, the cash deposit rate will be 91.06 
percent, the ``all others'' rate established in the LTFV investigation.
    These cash deposit requirements, 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 Tariff Act (19 U.S.C. 1675 (a)(1)) and 19 CFR 
353.22.

    Dated: August 27, 1996.
Robert S. LaRussa,
Acting Assistant Secretary for Import Administration.
[FR Doc. 96-22680 Filed 9-4-96; 8:45 am]
BILLING CODE 3510-DS-M