[Federal Register Volume 61, Number 191 (Tuesday, October 1, 1996)]
[Notices]
[Pages 51266-51269]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-25114]


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DEPARTMENT OF COMMERCE
International Trade Administration
[A-475-703]


Granular Polytetrafluoroethylene Resin From Italy; Preliminary 
Results of Antidumping Duty Administrative Review

AGENCY: Import Administration, International Trade 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 the petitioner, the Department of 
Commerce (the Department) is conducting an administrative review of the 
antidumping duty order on granular polytetrafluoroethylene (PTFE) resin 
from Italy. This review covers one manufacturer/exporter of the subject 
merchandise to the United States for the period August 1, 1994, through 
July 31, 1995.
    We have preliminarily determined that dumping margins exist for the 
respondent. Interested parties are invited to comment on these 
preliminary results. Parties who submit arguments in this proceeding 
are requested to submit with each argument (1) a statement of the 
issue, and (2) a brief summary of the argument.

EFFECTIVE DATE: October 1, 1996.

FOR FURTHER INFORMATION CONTACT: Michael Rausher or Richard Rimlinger, 
Import Administration, International Trade Administration, U.S. 
Department of Commerce, 14th Street and Constitution Avenue, N.W., 
Washington, DC 20230; telephone: (202) 482-4733.

SUPPLEMENTARY INFORMATION:

Applicable Statute and Regulations

    Unless otherwise indicated, all citations to the Tariff Act of 
1930, as amended (the Act), are references to the provisions effective 
January 1, 1995, the effective date of the amendments made to 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).

Background

    On August 30, 1988, the Department published in the Federal 
Register (53 FR 33163) the antidumping duty order on granular PTFE 
resin from Italy. On August 1, 1995, the Department published a notice 
of ``Opportunity to Request Administrative Review'' of the antidumping 
duty order for the period of August 1, 1994 through July 31, 1995 (60 
FR 39150). We received a timely request for review from the petitioner, 
E. I. DuPont de Nemours & Company. On October 12, 1995, the Department 
initiated a review of Ausimont S.p.A. (60 FR 53165).

Scope of the Review

    The product covered by this review is granular PTFE resins, filled 
or unfilled. This order also covers PTFE wet raw polymer exported from 
Italy to the United States. See Granular Polytetrafluoroethylene Resin 
from Italy; Final Determination of Circumvention of Antidumping Duty 
Order, 58 FR 26100 (April 30, 1993). This order excludes PTFE 
dispersions in water and fine powders. During the period covered by 
this review, such merchandise was classified under item number 
3904.61.00 of the Harmonized Tariff Schedule (HTS). We are providing 
this HTS number for convenience and Customs purposes only. The written 
description of the scope remains dispositive.
    The review covers one Italian manufacturer/exporter of granular 
PTFE resin, Ausimont S.p.A., and the period August 1, 1994 through July 
31, 1995.

Use of Facts Available

    In the Department's initial questionnaire, we requested that 
Ausimont provide value-added data for all models which are further 
manufactured in the United States. Ausimont failed to provide this 
information. In a supplemental questionnaire dated May 26, 1996, we 
again requested that Ausimont report the cost of further manufacturing 
performed in the United States. In responding, Ausimont still failed to 
provide this information for certain models.
    Section 776(a) of the Act provides that if necessary information is 
not available on the record, or an interested party or any other person 
fails to provide such information by the deadlines for submission of 
the information or in the form and manner requested, the Department 
shall use the facts otherwise available. In addition, section 776(b) of 
the Act provides that if an interested party has failed to cooperate by 
not acting to the best of its ability to comply with a request for 
information, the Department may use an inference that is adverse to the 
interests of that party in selecting from among the facts otherwise 
available.
    Ausimont's failure to provide further manufacturing data for 
certain models

[[Page 51267]]

renders it necessary that we rely upon the facts otherwise available. 
Ausimont offered no explanation for this failure on its part, despite 
the Department's repeated requests for this information. On this basis, 
we preliminarily determine that Ausimont failed to cooperate by not 
acting to the best of its ability to comply with the Department's 
information requests. Therefore, we determine it is appropriate to use 
an inference that is adverse to Ausimont's interests, pursuant to 
section 776(b) of the Act. Section 776(b) authorizes the Department to 
use as facts otherwise available information derived from the petition, 
the final determination, a previous administrative review, or any other 
information placed on the record. We have determined that the number of 
models for which Ausimont failed to provide further manufacturing data 
are relatively few in number, and the absence of this information does 
not impact upon the remainder of Ausimont's data base. For these 
reasons, we are not resorting to total facts available under section 
776(a). We have instead selected the highest reported cost of further 
manufacturing reported by Ausimont as facts available for those models 
for which Ausimont failed to report the cost of further manufacturing.

United States Price

    The Department based United States price (USP) on constructed 
exporter's sale price (CEP) as defined in section 772(b) of the Act 
because all sales to unrelated parties were made after importation of 
the subject merchandise into the United States. We based CEP on the 
packed, delivered prices to unrelated purchasers in the United States 
(the starting price). We made deductions for movement expenses, in 
accordance with section 772(c)(2)(A) of the Act, including 
international freight, marine insurance, brokerage and handling, U.S. 
inland freight, other transportation expenses, and U.S. customs duties.
    In accordance with section 772(d)(1) of the Act and the Statement 
of Administrative Action (SAA) accompanying the URAA (at 823-824), we 
also adjusted the starting price by deducting selling expenses 
associated with economic activities occurring in the United States, 
including direct selling expenses assumed on behalf of the buyer and 
U.S. indirect selling expenses. Finally, we made an adjustment for an 
amount of profit allocated to these expenses, in accordance with 
section 772(d)(3) of the Act and as described in section 772(f).
    For sales of granular PTFE resin finished in the United States from 
PTFE wet raw polymer imported from Italy, we determined that the 
special rule for merchandise with value added after importation under 
section 772(e) of the Act did not apply because the value added in the 
United States by the affiliated person did not exceed substantially the 
value of the subject merchandise. Therefore, for subject merchandise 
further manufactured in the United States, we used the starting price 
of the subject merchandise and deducted the costs of further 
manufacturing to determine the CEP for such merchandise in accordance 
with section 772(d)(2) of the Act. We deducted the costs of further 
manufacturing in the United States and that portion of the profit on 
sales of further-manufactured merchandise attributable to the 
additional manufacturing. No other adjustments were claimed or allowed.

Normal Value

    In order to determine whether there was a sufficient volume of 
sales of granular PTFE resin in the home market to serve as a viable 
basis for calculating normal value (NV), we compared respondent'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) of the Act. Because the aggregate volume of home market sales of 
the foreign like product for Ausimont was greater than five percent of 
the respective aggregate volume of U.S. sales for the subject 
merchandise, we determined that the home market provides a viable basis 
for calculating NV for Ausimont. Therefore, in accordance with section 
773(a)(1)(B)(i) of the Act, we based NV on the prices at which the 
foreign like product was first sold for consumption in the exporting 
country, in the usual commercial quantities and in the ordinary course 
of trade.
    We calculated NV on a monthly weighted-average basis. Where 
possible, we compared U.S. sales to sales of identical merchandise in 
Italy. When there were no identical sales of the foreign like product 
available for matching purposes, we based NV on contemporaneous sales 
of the most similar foreign like product, in accordance with section 
771(16) of the Act. Because filled and unfilled resins generally are 
not similar in terms of their physical characteristics, we compared, 
whenever possible, home market sales of filled resins to U.S. sales of 
filled resins and home market sales of unfilled resins with U.S. sales 
of unfilled resins. We matched filled resins sold in the two markets 
according to the amounts and types of fillers, and the percentages of 
fillers, in the products sold based upon the information provided in 
Ausimont's questionnaire response.
    In accordance with section 773(a)(4) of the Act, we used 
constructed value (CV) as the basis for NV when there were no 
comparable sales of the foreign like product in the home market. We 
calculated CV in accordance with section 773(e) of the Act. We included 
the cost of materials and fabrication, selling, general and 
administrative (SG&A) expenses, and profit. In accordance with section 
773(e)(2)(A) of the Act, we based SG&A expenses and profit on the 
amounts incurred and realized by Ausimont in connection with the 
production and sale of the foreign like product in the ordinary course 
of trade for consumption in Italy. For selling expenses, we used the 
weighted-average home market selling expenses. We included U.S. packing 
pursuant to section 773(e)(3) of the Act. Where appropriate, we made 
adjustments to CV, in accordance with section 773(a)(8) of the Act for 
differences in the circumstances of sale (COS). Specifically, we made 
COS adjustments by deducting home market direct selling expenses.
    Where applicable, we made adjustments for packing and movement 
expenses, in accordance with sections 773(a)(6) (A) and (B) of the Act. 
In order to adjust for differences in packing between the two markets, 
we deducted home market packing costs from NV and added U.S. packing 
costs. We also made adjustments for differences in costs attributable 
to differences in physical characteristics of the merchandise, pursuant 
to section 773(a)(6)(C)(ii) of the Act, and for other differences in 
the COS in accordance with section 773(a)(6)(C)(iii) of the Act. These 
COS adjustments included deductions for home market rebates and credit.

Level of Trade

    As set forth in section 773(a)(1)(B)(i) of the Act and in the SAA 
accompanying the URAA at pages 829-831, the Department will, to the 
extent practicable, calculate normal value based on sales at the same 
level of trade as the U.S. sales. When the Department is unable to find 
sales in the comparison market at the same level of trade as the U.S. 
sales, the Department may compare sales in the U.S. and foreign markets 
at different levels of trade. See Final Determination of Sales at Less 
Than Fair Value: Certain Pasta from Italy, 61 FR 30326 (June 14, 1996).
    In accordance with section 773(a)(7)(A), if sales at different 
levels of

[[Page 51268]]

trade are compared, the Department will adjust the normal value to 
account for the difference in level of trade if the different sales 
functions between the levels of trade affect price comparability as 
evidenced by a pattern of consistent price differences between sales of 
the different levels of trade in which NV is determined.
    Additionally, section 773(a)(7)(B) of the Act establishes that a 
CEP offset may be made when two conditions are present: (1) NV is 
established at a level of trade which constitutes a more advanced stage 
of distribution than the level of trade of the CEP; and (2) the data 
available do not provide an appropriate basis for a level-of-trade 
adjustment.
    In order to determine that there is a difference in level of trade, 
the Department must find that two sales have been made at different 
phases of marketing, or the equivalent. Different phases of marketing 
necessarily involve differences in selling functions, but differences 
in selling functions (even substantial ones) are not alone sufficient 
to establish a difference in the level of trade. Similarly, seller and 
customer descriptions (such as ``distributor'' and ``wholesaler'') are 
useful in identifying different levels of trade, but are insufficient 
to establish that there is a difference in the level of trade.
    We requested information about the selling activities associated 
with each phase of marketing, or the equivalent, in each of Ausimont's 
markets. Ausimont claimed that the level of trade of its CEP sales was 
the same as that of its NV sales. Ausimont claimed one level of trade 
and one channel of distribution with regard to its sales to its U.S. 
affiliate, Ausimont U.S.A., Inc. For its home market, Ausimont also 
claimed only one channel of distribution, from Ausimont to fabricators.
    To determine whether Ausimont's CEP and NV sales were at the same 
level of trade, we reviewed the selling activities associated with both 
types of sales. Because Ausimont's sales in the United States were all 
based on CEP, we only considered the selling activities reflected in 
the price after making the appropriate adjustments under section 772(d) 
of the Act. Certain Stainless Wire Rods From France: Final Results of 
Antidumping Duty Administrative Review, 61 FR 47874, 47879-80 (Sept. 
11, 1996); Preliminary Results of Antidumping Duty Administrative 
Reviews of Antifriction Bearings (Other Than Tapered Roller Bearings) 
and Parts Thereof From France, et al., 61 FR 35713 (July 8, 1996). The 
selling activities included inventory maintenance, after sales 
services/warranties, post-sale warehousing, technical advice, strategic 
and economic planning, market research, computer assistance, personnel 
training, engineering services, research and development, advertising, 
procurement, and freight and delivery services. Whenever sales were 
made by or through an affiliated company or agent, we considered all 
selling activities of both affiliated parties, except for those selling 
activities related to the expenses deducted under section 772(d) of the 
Act.
    We determined that the selling functions performed by Ausimont for 
the home market are the same as those performed by Ausimont for CEP 
sales and that Ausimont's home market level of trade constituted the 
same stage of distribution as that of the level of trade of the CEP. 
Therefore, in accordance with section 773(a)(7)(B) of the Act, because 
we determined that Ausimont's home market sales upon which we 
established NV were at the same level of trade as that of the CEP, we 
made no CEP offset to NV.

Preliminary Results of Review

    As a result of this review, we preliminarily determine that the 
following weighted-average dumping margin exists:

------------------------------------------------------------------------
                                                                 Margin 
          Manufacturer/exporter                  Period        (percent)
------------------------------------------------------------------------
Ausimont S.p.A..........................    08/01/94-07/31/95       6.23
------------------------------------------------------------------------

    Parties to the proceeding may request disclosure within five 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, or the 
first workday thereafter. Case briefs and/or written comments from 
interested parties may be submitted not later than 30 days after the 
date of publication. Rebuttal briefs and rebuttals to written comments, 
limited to issues raised in the case briefs and comments, may be filed 
not later than 37 days after the date of publication. Parties who 
submit arguments in this proceeding are requested to submit with each 
argument (1) a statement of the issue and (2) a brief summary of the 
argument. The Department will issue the final results of the 
administrative review, including the results of its analysis of issues 
raised in any such written comments or at a hearing, within 120 days of 
issuance of these preliminary results.
    The Department shall determine, and Customs shall assess, 
antidumping duties on all appropriate entries. Individual differences 
between USP and NV may vary from the percentage stated above. The 
Department will issue appraisement instructions directly to Customs. 
The final results of this review shall be the basis for the assessment 
of antidumping dumping duties on entries of merchandise covered by the 
determination and for future deposits of estimated duties.
    Furthermore, the following deposit requirements will be effective 
upon completion of the final results of this administrative review for 
all shipments of PTFE resin from Italy 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 Act: (1) The cash deposit rate for Ausimont will be 
the rate established in the final results of administrative review; (2) 
for merchandise exported by manufacturers or exporters not covered in 
this review but covered in the original less than fair value (LTFV) 
investigation or a previous review, the cash deposit will continue to 
be the most recent rate published in the final determination or final 
results for which the manufacturer or exporter received a company-
specific rate; (3) if the exporter is not a firm covered in this 
review, a previous review, or the original investigation, but the 
manufacturer is, the cash deposit rate will be that established for the 
manufacturer of the merchandise in the final results of this review or 
the LTFV investigation; and (4) if neither the exporter nor the 
manufacturer is a firm covered in this or any previous review, the cash 
deposit rate will be 46.46 percent, the ``all others'' rate established 
in the LTFV investigation (50 FR 26019, June 24, 1985).
    This notice also serves as a preliminary reminder to importers of 
their responsibility 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 (19 U.S.C. 1675(a)(1)) and 19 C.F.R. 
Sec. 353.22 (1996).


[[Page 51269]]


    Dated: September 25, 1996.
Robert S. LaRussa,
Acting Assistant Secretary for Import Administration.
[FR Doc. 96-25114 Filed 9-30-96; 8:45 am]
BILLING CODE 3510-DS-P