[Federal Register Volume 61, Number 216 (Wednesday, November 6, 1996)]
[Notices]
[Pages 57391-57397]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-28559]
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DEPARTMENT OF COMMERCE
[A-588-054, A-588-604]
Tapered Roller Bearings and Parts Thereof, Finished and
Unfinished, From Japan, and Tapered Roller Bearings, Four Inches or
Less in Outside Diameter, and Components Thereof, From Japan;
Preliminary Results of Antidumping Duty Administrative Reviews and
Partial Termination of Administrative Reviews
AGENCY: Import Administration, International Trade Administration,
Department of Commerce.
ACTION: Notice of Preliminary Results of Antidumping Duty
Administrative Reviews and Partial Termination of Administrative
Reviews.
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SUMMARY: In response to requests by the petitioner and two respondents,
the Department of Commerce (the Department) is conducting
administrative reviews of the antidumping duty order on tapered roller
bearings (TRBs) and parts thereof, finished and unfinished, from Japan
(A-588-604), and of the antidumping finding on TRBs, four inches or
less in outside diameter, and components thereof, from Japan (A-588-
054). The review of the A-588-054 finding covers one manufacturer/
exporter and seven resellers/exporters of the subject merchandise to
the United States during the period October 1, 1994, through September
30, 1995. The review of the A-588-604 order covers two manufacturers/
exporters, seven resellers/exporters, four firms identified by the
petitioner in this case as forging producers, and the period October 1,
1994, through September 30, 1995.
We preliminarily determine that sales of TRBs have been made below
the normal value (NV). If these preliminary results are adopted in our
final results of administrative review, we will instruct the U.S.
Customs Service to assess antidumping duties equal to the difference
between United States price and the NV. Interested parties are invited
to comment on these preliminary results. Parties who submit argument in
these proceedings are requested to submit with the argument (1) a
statement of the issues and (2) a brief summary of the argument.
EFFECTIVE DATE: November 6, 1996.
FOR FURTHER INFORMATION CONTACT: Valerie Turoscy, Robert James, or John
Kugelman, AD/CVD Enforcement, Group III, Import Administration,
International Trade Administration, U.S. Department of Commerce, 14th
Street and Constitution Avenue, N.W., Washington, D.C. 20230,
telephone: (202) 482-0145, 5222, or 0649, respectively.
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 Rounds Agreements
Act. 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
On August 18, 1976, the Treasury Department published in the
Federal Register (41 FR 34974) the antidumping finding on TRBs from
Japan, and on October 6, 1987, the Department published the antidumping
duty order on TRBs from Japan (52 FR 37352). On October 5, 1995, the
Department published the notice of ``Opportunity to Request
Administrative Review'' for both TRB cases covering the period October
1, 1994 through September 30, 1995 (60 FR 52149).
In accordance with 19 CFR 353.22(a)(1) (1995), the petitioner, the
Timken Company (Timken), requested that we conduct a review of Honda
Motor Company, Ltd. (Honda), Fuji Heavy Industries (Fuji), Kawasaki
Heavy Industries (Kawasaki), Yamaha Motor Co., Ltd. (Yamaha), Nigata
Convertor Co., Ltd. (Nigata), Suzuki Motor Co., Ltd. (Suzuki), and
Toyosha Co., Ltd. (Toyosha), in both the A-588-054 and A-588-604 cases.
In addition, Timken requested that we conduct a review of Nittetsu
Bolten (Nittetsu), Showa Seiko Co., Ltd. (Showa), Ichiyanagi Tekko
(Ichiyanagi), and Sumikin Seiatsu (Sumikin) in the A-588-604 TRB case.
Koyo Seiko Co., Ltd. (Koyo) requested that we conduct a review of its
sales in both TRB cases, and NTN Corporation (NTN) requested that we
conduct a review of its sales in the A-588-604 case. On November 11,
1995, we published in the Federal Register a notice of initiation of
these antidumping duty administrative reviews covering the period
October 1, 1994 through September 30, 1995 (60 FR 57573).
Because it was not practicable to complete these reviews within the
normal time frame, on May 6, 1996, we published in the Federal Register
our notice of the extension of the time limits for both the A-588-054
and A-588-604 1994-95 reviews (61 FR 8253). As a result of this
extension and the 28-day total federal government shutdown, we extended
the deadline for these preliminary results to October 30, 1996, and for
the final results to February 28, 1997.
Scope of the Reviews
Imports covered by the A-588-054 finding are sales or entries of
TRBs, four inches or less in outside diameter when assembled, including
inner race or cone assemblies and outer races or cups, sold either as a
unit or separately. This merchandise is classified under Harmonized
Tariff Schedule (HTS) item numbers 8482.20.00 and 8482.99.30.
Imports covered by the A-588-604 order include TRBs and parts
thereof, finished and unfinished, which are flange, take-up cartridge,
and hanger units incorporating TRBs, and roller housings (except pillow
blocks) incorporating tapered rollers, with or without spindles,
whether or not for automotive use. Products subject to the A-588-054
finding are not included within the scope of this order, except those
manufactured by NTN. This merchandise is currently classifiable under
HTS item numbers 8482.99.30, 8483.20.40, 8482.20.20, 8483.20.80,
8482.91.00, 8483.30.80, 8483.90.20, 8483.90.30, and 8483.90.60. In
addition, on February 2, 1995, we published in the Federal Register our
final scope decision concerning Koyo's rough forgings (60 FR 6519), in
which we determined that Koyo's rough forgings were within the scope of
the A-588-604 order. The HTS item numbers listed above for both the A-
588-054 finding and the A-588-604 order are provided for convenience
and Customs purposes. The written description remain dispositive.
The period for each 1994-95 review is October 1, 1994, through
September 30, 1995. The review of the A-588-054 case covers TRB sales
by one manufacturer/exporter (Koyo), and seven reseller/exporters
(Honda, Fuji, Kawasaki, Yamaha, Nigata, Suzuki, and Toyosha). The
review of the A-588-054 case covers TRBs sales by two manufacturers/
exporters (Koyo and NTN), seven reseller/exporters (Honda, Fuji,
Kawasaki, Yamaha, Nigata, Suzuki, and Toyosha), and four firms
identified as forging producers (Nittetsu, Showa, Ichiyanagi, and
Sumikin). As described in the ``Termination in Part '' section of
[[Page 57392]]
this notice, we are terminating our review of five of the 13 firms in
the A-588-604 case and two firms in the A-588-054 case.
Termination in Part
In accordance with section 353.22(a)(5) (1995) of the Department's
regulations, on January 16, 1996, Koyo withdrew its request for review
in the A-588-604 case and on January 25, 1996, NTN also withdrew its
request for review in the A-588-604 case. In addition, on March 7,
1996, Timken withdrew its request for review for Ichiyanagi in the A-
588-604 case and for Toyosha in both the A-588-604 and A-588-054 cases.
Because we received timely requests for the withdrawal of review from
Koyo, NTN, and Timken, and because no other party to the proceedings
requested a review for Koyo, NTN, and Ichiyanagi in the A-588-604 case
and Toyosha in both the A-588-604 and A-588-054 cases, in accordance
with 19 CFR 353.22(a)(5), we are terminating the A-588-604 review with
respect to Koyo, NTN, Ichiyanagi, and both the A-588-054 and A-588-604
reviews for Toyosha.
In addition, we are terminating the A-588-604 review for one of the
four firms Timken identified as a potential forging producer. Sumikin
reported that not only did it not export subject merchandise to the
United States during the POR, but it did not manufacture any TRBs or
forgings for TRBs during the POR. Because this firm did not produce or
export the subject merchandise, we are terminating the A-588-604 review
for Sumikin. Our termination of the A-588-604 review for this firm does
not constitute a revocation of the firm from the order. If this firm
ever becomes a manufacturer/exporter of TRBs or forgings used in the
production of TRBs, its sales to the United States will be subject to
the order.
We are also terminating the A-588-054 review for Honda based on the
fact that we recently revoked Honda from the A-588-054 finding in our
1992-93 TRB final results notice. See Tapered Roller Bearings and Parts
Thereof, Finished and Unfinished, From Japan and TRBs, Four Inches or
Less in Outside Diameter, and Components Thereof, From Japan; Final
Results of Antidumping Duty Administrative Reviews and Revocation in
Part of an Antidumping Finding, issued October 29, 1996.
No Shipments
Two resellers, Fuji and Honda, made no shipments of A-588-604
merchandise during the review period. In addition, neither Fuji nor
Honda was a party to the A-588-604 less-than-fair-value (LTFV)
investigation or any prior administrative reviews of the A-588-604
case. Because Fuji's and Honda's shipments have never been reviewed
individually, we have not assigned a rate to either firm for the A-588-
604 case. If Fuji or Honda begins shipping merchandise subject to the
A-588-604 order at some future date, the entries will be subject to
cash deposit rates attributable to the manufacturer(s) of the subject
merchandise.
Two of the four firms Timken identified as forging producers also
made no shipments of A-588-604 merchandise. Showa reported that, while
it made forgings used in the production of TRBs, it did not export TRBs
or forgings to the United States during the review period. Nittetsu
also reported that it did not export TRBs or forgings used in the
production of TRBs during the review period. Because both producers (1)
had no shipments of merchandise subject to the A-588-604 order during
the review period, (2) were not party to the LTFV investigation, and
(3) were never party to any prior administrative reviews of the A-588-
604 case, we have not assigned individual rates to Showa and Nittetsu
for the A-588-604 case. If Showa or Nittetsu were to begin shipping
merchandise subject to the A-588-604 order at some future date, the
entries will be subject to the A-588-604 LTFV ``all others'' cash
deposit rate of 36.52 percent.
Use of Facts Available
We preliminarily determine, in accordance with section 776(a) of
the Act, that the use of facts available is appropriate for Yamaha,
Kawasaki, Nigata, and Suzuki in both the A-588-054 and A-588-604 cases
because these firms either did not respond in any way to our
antidumping questionnaire, or submitted letters stating that they
decline to respond to our antidumping questionnaire. We preliminarily
find that these firms have withheld ``information that has been
requested by the administering authority.'' Furthermore, we
preliminarily determine that, pursuant to section 776(b) of the Act, it
is appropriate to make an inference adverse to the interests of these
companies because they failed to cooperate by not responding to our
questionnaire. As a result, for the weighted-average dumping margins
for these firms, we have used the highest rate from any prior segment
of the respective A-588-054 and A-588-604 proceedings as adverse facts
available, which is secondary information within the meaning of section
776(c) of the Act.
Section 776(c) of the Act provides that the Department shall, to
the extent practicable, corroborate secondary information used as facts
available from independent sources reasonably at its disposal. The
Statement of Administrative Action (SAA) provides that ``corroborate
means simply that the Department will satisfy itself that the secondary
information to be used has probative value (see H.R. Doc. 316, Vol. 1,
103d Cong., 2d sess. 870 (1994)).
To corroborate secondary information, the Department will, to the
extent practicable, examine the reliability and relevance of the
information used. However, unlike other types of information, such as
input costs or selling expenses, there are no independent sources for
calculated dumping margins. The only source for margins is
administrative determinations. Thus, in an administrative review, if
the Department chooses as total adverse facts available a calculated
dumping margin from a prior segment of the proceeding, it is not
necessary to question the reliability of the margin for that time
period. With respect to the relevance aspect of corroboration, however,
the Department will consider information reasonably at its disposal as
to whether there are circumstances that would render a margin
irrelevant. Where circumstances indicate that the selected margin is
not appropriate as adverse facts available, the Department will
disregard the margin and determine an appropriate margin (see Fresh Cut
Flowers from Mexico; Preliminary Results of Antidumping Duty
Administrative Review, 60 FR 49567 (February 22, 1996), where we
disregarded the highest margin in the case as adverse best information
available because the margin was based on another company's
uncharacteristic business expense resulting in an extremely high
margin).
For these preliminary results, we have examined the history of the
A-588-054 and A-588-604 cases and have determined that 47.63 percent,
the rate we calculated for Koyo in the 1987-88 A-588-054 review, is the
highest calculated rate for any firm in any prior segment of the A-588-
054 finding, and that 40.37 percent, the rate we calculated for NSK
Corporation in the 1988-89 A-588-604 review, is the highest calculated
rate for any firm in any prior segment of the A-588-604 order. In
addition, we have examined the circumstances surrounding the
calculation of these two rates and have determined that there is no
reliable evidence on the administrative records
[[Page 57393]]
for the reviews in which these rates were calculated which indicates
that these margins are irrelevant or inappropriate. As a result, for
these preliminary results we have used 47.63 percent in the A-588-054
case and 40.37 percent in the A-588-604 case as total adverse facts
available for Yamaha, Kawasaki, Nigata, and Suzuki.
Constructed Export Price
Because all of Koyo's sales and certain of Fuji's sales of subject
merchandise were first sold to unrelated purchasers after import into
the United States, in calculating U.S. price we used constructed export
price (CEP) for all of Koyo's sales and certain of Fuji's sales, as
defined in section 772(b) of the Act.
We based CEP on the packed, delivered price to unrelated purchasers
in the United States. We made deductions, where appropriate, for
discounts, billing adjustments, freight allowances, and rebates.
Pursuant to section 772(c)(2)(A) of the Act, we reduced this price for
movement expenses (Japanese pre-sale inland freight, Japanese post-sale
inland freight, international air and/or ocean freight, marine
insurance, Japanese brokerage and handling, U.S. inland freight from
the port to the warehouse, U.S. inland freight from the warehouse to
the customer, U.S. duty, and U.S. brokerage and handling). We also
reduced the price, where applicable, by an amount for the following
expenses incurred in the selling of the merchandise in the United
States pursuant to section 772(d)(1): commissions to unrelated parties,
U.S. credit, payments to third parties, U.S. repacking expenses, and
indirect selling expenses (which included, where applicable, inventory
carrying costs, indirect warehouse expenses, indirect advertising
expenses, indirect technical services expenses, pre-sale warehousing
expenses, other U.S.-incurred indirect selling expenses, and indirect
selling expenses incurred by the Japanese parent related to commercial
activity in the United States). Finally, pursuant to section 772(d)(3),
we further reduced USP by an amount for profit to arrive at CEP.
Because certain of Fuji's sales of subject merchandise were made to
unrelated purchasers in the United States prior to importation into the
United States, in accordance with section 772(a) of the Act, we used
export price (EP) for these sales. We calculated EP as the packed,
delivered price to unrelated purchasers in the United States. In
accordance with section 772(c)(2)(A) of the Act, we reduced this price
by Japanese pre-sale inland freight, Japanese post-sale inland freight,
international air and/or ocean freight, marine insurance, Japanese
brokerage and handling, U.S. brokerage and handling, U.S. duty, and
U.S. inland freight.
Where appropriate, in accordance with section 772(d)(2) of the Act,
the Department also deducts from USP the cost of any further
manufacture or assembly in the United States, except where the special
rule provided in section 772(e) of the Act is applied. With respect to
Koyo, there was no further manufacturing of A-588-054 TRBs by Koyo in
the United States during the review period and, as a result, an
adjustment for value added in the United States was unnecessary. With
respect to Fuji, its two U.S. affiliates, Subaru of America (SOA) and
Subaru-Isuzu Automotive (SIA), both import TRBs into the United States
which were first purchased by Fuji from Japanese producers in Japan.
While SOA imported TRBs during the review period for the sole purpose
of reselling the bearings as replacement parts for Subaru automobiles
in the United States, SIA imported TRBs for the sole purpose of using
them in its production of Subaru automobiles in the United States, the
final product sold by SIA to the first unaffiliated customer in the
United States. As a result, we requested information from Fuji and SIA
concerning this further manufacture and have determined that the
special rule for merchandise with value added after importation under
section 772(e) of the Act applies to Fuji.
Section 772(e) of the Act provides that, where the subject
merchandise is imported by an affiliated person and the value added in
the United States by the affiliated person is likely to exceed
substantially the value of the subject merchandise, we shall determine
the CEP for such merchandise using the price of identical or other
subject merchandise if there is a sufficient quantity of sales to
provide a reasonable basis for comparison and we determine that the use
of such sales is appropriate. If there is not a sufficient quantity of
such sales or if we determine that using the price of identical or
other subject merchandise is not appropriate, we may use any other
reasonable basis to determine CEP.
To determine whether the value added in the United States by SIA is
likely to exceed substantially the value of the subject merchandise, we
estimated the value added based on the differences between the averages
of the prices charged to the first unaffiliated U.S. customer for the
final merchandise sold (the automobiles) and the averages of the prices
paid for the subject merchandise (the imported TRBs) by the affiliated
person. Based on this analysis and information on the record, we
determined that the value of the TRBs further processed by SIA in the
United States was a minuscule amount of the price charged by SIA to the
first unaffiliated customer for the automobiles it sold in the United
States. Therefore, we determined that the value added is likely to
exceed substantially the value of the subject merchandise. Accordingly,
it was unnecessary for us to make an adjustment for value added in the
United States. In addition, we have determined that those sales of TRBs
made by SOA as replacement parts in the United States, which constitute
sales of merchandise identical and/or most similar to those TRBs
imported by SIA for use in the manufacture of Subaru automobiles, were
made in sufficient quantities to provide a reasonable basis for
comparison. Therefore, for purposes of determining dumping margins for
the TRBs entered by SIA and used in the production of automobiles, we
have used the weighted-average dumping margins we calculated on sales
of identical or other subject merchandise sold by SOA as replacement
TRBs to unaffiliated persons in the United States.
No other adjustments to USP were claimed or allowed.
Normal Value
A. Viability
Based on (1) Our comparison of the aggregate quantity of home
market and U.S. sales, (2) the absence of any information that a
particular market situation in the exporting country does not permit a
proper comparison, and (3) the fact that each company's quantity of
sales in the home market was greater than five percent of its sales to
the U.S. market, we determined that the quantity of the foreign like
product for Fuji and Koyo sold in the exporting country was sufficient
to permit a proper comparison with the sales of subject merchandise to
the United States pursuant to section 773(a) of the Act. Therefore, in
accordance with section 773(a)(1)(B)(i) of the Act, we based NV on the
prices at which the foreign like products were first sold for
consumption in the exporting country.
B. Arm's-Length Sales
We excluded from our analysis those sales Koyo and Fuji made to
affiliated customers in the home market which were not at arm's length.
We determined the arm's-length nature of Koyo's and
[[Page 57394]]
Fuji's home market sales to affiliated parties by means of our 99.5
percent arm's-length test in which we calculated, for each model, the
percentage difference between the weighted-average prices to the
affiliated customer and all unaffiliated customers and then calculated,
for each affiliated customer, the overall weighted-average percentage
difference in prices for all models purchased by the customer. If the
overall weighted-average price ratio for the affiliated customer was
equal to or greater than 99.5 percent, we determined that all sales to
this affiliated customer were at arm's length. Conversely, if the ratio
for a customer was less than 99.5 percent, we determined that all sales
to the affiliated customer were not at arm's length because, on
average, the customer paid less than unaffiliated customers for the
same merchandise. Therefore, we excluded all sales to the customer from
our analysis. Where we were unable to calculate an affiliated customer
ratio because identical merchandise was not sold to both affiliated and
unaffiliated customers, we were unable to determine if these sales were
at arm's length and, therefore, excluded them from our analysis (see
Stainless Steel Wire Rods from France: Preliminary Results of
Antidumping Duty Administrative Review (61 FR 8915 (March 6, 1996)).
C. Cost of Production Analysis
Because we disregarded sales below the cost of production (COP) in
our last completed A-588-054 review for Koyo, we have reasonable
grounds to believe or suspect that sales of the foreign like product
under consideration for the determination of NV in this review may have
been made at prices below the COP, as provided by section
773(b)(2)(A)(ii) of the Act (see Final Results of Antidumping Duty
Administrative Reviews; Tapered Roller Bearings and Parts Thereof,
Finished and Unfinished, From Japan and Tapered Roller Bearings, Four
Inches or Less in Outside Diameter, and Components Thereof, from Japan,
58 FR 64720 (December 9, 1993)). Therefore, pursuant to section
773(b)(1) of the Act, we initiated a COP investigation of sales by
Koyo.
In accordance with section 773(b)(3) of the Act, we calculated COP
based on the sum of the costs of materials and fabrication employed in
producing the foreign like product, plus selling, general, and
administrative expenses (SG&A) and the cost of all expenses incidental
to placing the foreign like product in condition packed ready for
shipment. We relied on the home market sales and COP information
provided by Koyo in its questionnaire responses.
After calculating COP, we tested whether home market sales of TRBs
were made at prices below COP within an extended period of time in
substantial quantities and whether such prices permit the recovery of
all costs within a reasonable period of time. We compared model-
specific COPs to the reported home market prices less any applicable
movement charges, discounts, or rebates.
Pursuant to section 773(b)(2)(C) of the Act, where less than 20
percent of a respondent's home market sales for a model are at prices
less than the COP, we do not disregard any below-cost sales of that
model because we determine that the below-cost sales were not made
within an extended period of time in ``substantial quantities.'' Where
20 percent or more of a respondent's home market sales of a given model
are at prices less than COP, we disregard the below-cost sales because
they are (1) Made within an extended period of time in substantial
quantities in accordance with sections 773(b)(2) (B) and (C) of the
Act, and (2) based on comparisons of prices to weighted-average COPs
for the POR, were at prices which would not permit the recovery of all
costs within a reasonable period of time in accordance with section
773(b)(2)(D) of the Act.
The results of our cost test for Koyo indicated that for certain
home market models less than 20 percent of the sales of the model were
at prices below COP. We therefore retained all sales of the model in
our analysis and used them as the basis for determining NV. Our cost
test for Koyo also indicated that within an extended period of time
(one year, in accordance with section 773(b)(2)(B) of the Act), for
certain home market models more than 20 percent of the home market
sales were sold at prices below COP. In accordance with section
773(b)(1) of the Act, we therefore excluded these below-cost sales from
our analysis and used the remaining above-cost sales as the basis for
determining NV.
D. Product Comparisons
For both Fuji and Koyo we compared U.S. sales with contemporaneous
sales of the foreign like product in the home market. We considered
bearings identical on the basis of nomenclature and determined most
similar TRBs using our sum-of-the-deviations model-match methodology
which compares TRBs according to the following five physical criteria:
inside diameter, outside diameter, width, load rating, and Y2 factor.
For Koyo we used a 20 percent difference-in-merchandise (difmer) cost
deviation cap as the maximum difference in cost allowable for similar
merchandise, which we calculated as the absolute value of the
difference between the U.S. and home market variable costs of
manufacturing divided by the U.S. total cost of manufacturing. Because
Fuji, a reseller, was unable to provide the variable and total costs of
manufacturing for the TRBs it purchased from Japanese producers, it
instead provided its acquisition cost for each TRB model it purchased
from Japanese producers. As a result, consistent with our practice in
past TRB reviews for Fuji, we used these acquisition costs as the basis
for our 20-percent difmer cap (see, e.g., Tapered Roller Bearings and
Part Thereof, Finished and Unfinished, From Japan and Tapered Roller
Bearings, Four Inches or Less in Outside Diameter, and Components
Thereof, from Japan: Preliminary Results of Administrative Reviews and
Termination in Part, 61 FR 25200 (May 20, 1996)).
E. Level of Trade
As set forth in section 773(a)(1)(B)(i) of the Act and in the SAA
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. sales. When we
are unable to find sales of the foreign like product in the comparison
market at the same level of trade as the U.S. sale, we may compare U.S.
sales to sales at a different level of trade in the comparison market.
In accordance with section 773(a)(7)(A) of the Act, if sales at
allegedly different levels of trade are compared, we will adjust the NV
to account for the difference in levels of trade if two conditions are
met. First, there must be differences between the actual selling
activities performed by the exporter at the level of trade of the U.S.
sale and the level of trade of the comparison market sales used to
determine NV. Second, the differences between levels of trade 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.
Section 773(a)(7)(B) of the Act establishes that a CEP ``offset''
may be made when two conditions exist: (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
[[Page 57395]]
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.
In implementing these principles in these reviews, we asked Fuji
and Koyo to provide detailed information concerning their selling
activities/functions for each claimed phase of marketing and to
establish any claimed levels of trade based on these activities. In
order to determine whether separate levels of trade actually existed
within or between the U.S. and home markets, we reviewed the selling
activities associated with each phase of marketing claimed by Fuji and
Koyo. Pursuant to section 773(a)(1)(B)(i) of the Act and the SAA at
827, in identifying levels of trade for EP and home market sales we
considered the selling functions reflected in the starting price before
any adjustments. For CEP sales we considered only the selling
activities reflected in the price after the deduction of expenses and
profit under section 772(d) of the Act. Whenever sales were made by or
through an affiliate company or agent, we considered all selling
activities of both affiliated parties, except for those selling
activities related to expenses deducted under section 772(d) of the Act
in CEP situations.
In reviewing the selling functions reported by Fuji and Koyo, we
considered all types of selling activities performed. In analyzing
whether separate levels of trade existed in these reviews, we found
that no single selling function in the bearings industry was sufficient
to indicate a separate level of trade (see Notice of Proposed
Rulemaking and Request for Public Comments, 61 FR 7307, 7348 (February
27, 1996)). In addition, in determining whether separate levels of
trade existed in or between the U.S. and home markets, we analyzed the
selling activities associated with the phases of marketing the
respondents reported and expected the functions and activities of the
seller to be similar if a respondent claimed levels of trade to be the
same. Conversely, if the party claimed that levels of trade were
different for different groups of sales, we expected the functions and
activities of the seller to be dissimilar.
Koyo reported two different phases of marketing, original equipment
manufacturers (OEM) and after-market (AM), in both its U.S. and home
markets. Based on our analysis of the information of the record
concerning the selling activities associated with each of Koyo's
claimed home market phases of marketing, we found significant
differences in the advertising, inventory maintenance, and sales and
marketing support activities performed and, to a lesser degree,
differences in other selling activities as well. As a result, we
determined that Koyo's claimed phases of marketing constituted two
separate home market levels of trade.
While Fuji sold to both related and unrelated dealers in Japan, it
reported that there were no significant differences in the selling
activities it performed when selling to each group and claimed only one
phase of marketing in the home market. Based on our examination of the
information supplied by Fuji, we agree that only one phase of marketing
exists and have therefore determined that there is only one level of
trade for Fuji in the home market.
With respect to Koyo's U.S. sales, which were all CEP sales, Koyo
reported two different phases of marketing based on the starting price
of the CEP sales made by its affiliated reseller to unaffiliated U.S.
customers. Likewise, Fuji reported three phases of marketing for its
U.S. CEP sales based on the starting price for the CEP sales made by
its affiliated reseller to unaffiliated customers in the United States.
While we recognize that Koyo's and Fuji's affiliated resellers
performed different selling activities in association with the reported
phases of marketing such that different U.S. levels of trade exist
based on the price to the unaffiliated U.S. customer (i.e., the CEP
starting price), in CEP situations we do not determine the U.S. level
of trade on the basis of the CEP starting price. Rather, as described
above, in CEP situations we determine the U.S. level of trade on the
basis of the CEP starting price minus the expenses and profit deducted
pursuant to section 772(d) of the Act (i.e., the level of trade of the
CEP sale). Therefore, in order to determine the U.S. level of trade for
Koyo's and Fuji's CEP sales, we examined those selling expenses Koyo
and Fuji performed in association with the phase of marketing from the
foreign parent to the affiliated reseller and, regardless of the level
of trade of the CEP starting price, found no significant differences in
the functions either Koyo or Fuji performed when selling to its
respective U.S. affiliate. As a result, we determined that there was
only one U.S. level of trade for both Koyo's and Fuji's CEP sales.
In regard to its EP sales, Fuji identified two categories of U.S.
EP sales: those to certain independent distributors in the United
States where the merchandise is directly shipped from Japan and the
paperwork is processed by, and certain selling functions are performed
by, Fuji's related affiliate SOA, and those direct sales to an
independent dealer/distributor in Hawaii. In determining whether
separate levels of trade existed between these two phases, we examined
the selling functions as reflected in the starting price to the
unaffiliated U.S. customer and found that Fuji provided very limited
selling functions to the Hawaiian dealer/distributor as compared to the
independent distributors. As a result, we have determined that Fuji's
EP sales constitute two separate U.S. EP levels of trade.
When we compared the level of trade of Koyo's CEP sales to Koyo's
home market levels of trade we found that the record indicated that the
level of trade of the CEP sales involved little or no technical
services, engineering services, advertising, after-sales services, or
strategic planning and, as a result, was different from either of the
home market levels and also at a less advanced stage of distribution
than sales at either of the home market levels. Likewise, when we
compared the level of trade of Fuji's CEP sales to its home market
level of trade, the record again indicated that the CEP sales involved
little or no technical services, engineering services, after-sale
services, or advertising and were at a less advanced stage of
distribution than the sales at the home market level of trade. Upon
comparing Fuji's sales at its two U.S. EP levels of trade to its sales
at its home market level we found that the selling functions at its
home market level of trade included strategic/economic planning
services, training and personnel services, and technical services which
were not characteristic of the U.S. EP levels of trade. Consequently,
because we were unable to find the same levels of trade in the home
market as in the United States for both respondents, we were unable to
match Fuji's and Koyo's U.S. CEP sales and Fuji's EP sales at the same
level of trade in the home market.
When we are unable to find sales of the foreign like product in the
home market at the same level of trade as that of the CEP or EP sales,
we examine whether a level-of-trade adjustment is appropriate. Because
the same level of trade as Koyo's and Fuji's CEP level and Fuji's EP
levels did not exist in their home markets, we lacked the data
necessary to determine whether there
[[Page 57396]]
was a consistent pattern of price differences between levels of trade
based on Koyo's and Fuji's home market sales of merchandise under
review, in accordance with section 773(a)(7)(A) of the Act. However,
the SAA states that ``if information on the same product and company is
not available, the adjustment may also be based on sales of other
products by the same company. In the absence of any sales, including
those in recent time periods, to different levels of trade by the
exporter or producer under investigation, Commerce may further consider
the selling experience of other producers in the home market for the
same product or other products'' (see SAA at 830). Accordingly, we
examined these alternative methods for calculating the level-of-trade-
adjustment for Koyo and Fuji, but we lacked the information that would
allow us to apply them. Because the data available do not provide an
appropriate basis for making a level-of-trade adjustment for Koyo or
Fuji, but Koyo's and Fuji's respective home market levels of trade are
at a more advanced stage of distribution than the level of trade of
their respective CEP sales, a CEP offset adjustment, in accordance with
section 773(a)(7)(B) of the Act, is appropriate. Both respondents
claimed a CEP offset adjustment and we applied the offset to NV in our
CEP comparisons for Koyo and Fuji.
F. Home Market Price
While we found below-cost home market sales for Koyo, Koyo's
remaining home market sales at or above cost were sufficient to serve
as the basis for NV.
We based home market prices on the packed, ex-factory or delivered
prices to affiliated purchasers (where an arm's-length relationship was
demonstrated) and unaffiliated purchasers in the home market. We made
adjustments for differences in packing and for movement expenses in
accordance with sections 773(a)(6) (A) and (B) of the Act. In addition,
we made adjustments for differences in cost attributable to differences
in physical characteristics of the merchandise pursuant to section
773(a)(6)(C)(II) of the Act, and for differences in circumstances of
sale (COS) in accordance with section 773(a)(6)(C)(iii) of the Act and
19 CFR 353.56. For comparison to EP we made COS adjustments by
deducting home market direct selling expenses and adding U.S. direct
selling expenses. For comparisons to CEP, we made COS adjustments to NV
by deducting home market direct selling expenses and, where applicable,
adding U.S. direct selling expenses, except those deducted from the
starting price in calculating CEP pursuant to section 772(d) of the
Act. We also made adjustments, where applicable, for home market
indirect selling expenses to offset U.S. commissions in EP and CEP
calculations.
While both Koyo and Fuji claimed certain post-sale price
adjustments to their reported home market prices, we have not allowed
these adjustments, as explained in detail in the proprietary versions
of our 1994-95 preliminary results analysis memoranda for Koyo and
Fuji.
No other adjustments were claimed or allowed.
Fair Value Comparisons
To determine whether sales of TRBs by the respondents in the United
States were made at less than fair value, we compared the CEP and EP to
NV, as described in the ``United States Price'' and ``Normal Value''
sections of this notice. In accordance with section 777A(d)(2) of the
Act, we calculated monthly weighted-average prices for NV and compared
these monthly averages to individual U.S. sales transactions. For Koyo,
which had two phases of marketing in the home market, we first
calculated monthly weighted-average NVs for the phase of marketing in
the home market which was most comparable to that in which the U.S.
transaction was made (as defined by the price to the first unrelated
U.S. customer). Then, to the extent possible, we compared CEP to this
NV. Alternatively, where there were no home market sales in the phase
of marketing most comparable to the U.S. sale, we weight-averaged home
market sales for the other home market phase of distribution and
compared CEP to this NV (see, e.g., Stainless Steel Wire Rods from
France: Preliminary Results of Antidumping Duty Administrative Review,
61 FR 8015 (March 6, 1996) and Fresh Kiwifruit from New Zealand:
Preliminary Results of Antidumping Duty Administrative Review, 61 FR
15922 (April 10, 1996)). In regard to Fuji, which sold in only one home
market channel of distribution, we compared CEP and EP to the monthly
weighted-average NVs we calculated for this single channel of
distribution.
Preliminary Results of Review
As a result of our reviews, we preliminarily determine the
following weighted-average dumping margins exist for the period October
1, 1994, through September 30, 1995:
------------------------------------------------------------------------
Margin
Manufacturer/exporter/reseller (percent)
------------------------------------------------------------------------
For the A-588-054 Case:
Koyo Seiko............................................... 31.25
Fuji..................................................... 11.35
Kawasaki................................................. 47.63
Yamaha................................................... 47.63
Nigata................................................... 47.63
Suzuki................................................... 47.63
For the A-588-604 Case:
Fuji..................................................... (\1\)
Honda.................................................... (\1\)
Kawasaki................................................. 40.37
Yamaha................................................... 40.37
Nigata................................................... 40.37
Suzuki................................................... 40.37
Nittetsu................................................. (\1\)
Showa Seiko.............................................. (\1\)
------------------------------------------------------------------------
\1\ No shipments or sales subject to this review. The firm has no rate
from any prior segment of this proceeding.
Parties to these proceedings may request disclosure within five
days of the date of publication of this notice and may request a
hearing within ten days of publication. Any hearing, if requested, will
be held 44 days after the date of publication, or the first business
day thereafter. Case briefs and/or written comments from interested
parties may be submitted no 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 no later
than 37 days after the date of publication of this notice. Parties who
submit argument in these proceedings are requested to submit with the
argument (1) a statement of the issues and (2) a brief summary of the
argument. The Department will issue final results of these
administrative reviews, including the results of our analysis of the
issues in any such written comments or at a hearing, within 180 days of
issuance of these preliminary results.
The Department shall determine, and the U.S. Customs Service shall
assess, antidumping duties on all appropriate entries. Individual
differences between USP and NV may vary from the percentages stated
above. The Department will issue appraisement instructions directly to
Customs.
Furthermore, the following deposit requirements will be effective
upon completion of the final results of these administrative reviews
for all shipments of TRBs from Japan entered, or withdrawn from
warehouse, for consumption on or after the publication date of the
final results of these administrative reviews, as provided by section
751(a)(1) of the Act:
(1) The cash deposit rates for the reviewed companies will be those
rates
[[Page 57397]]
established in the final results of these reviews;
(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 these reviews, a prior
review, or the LTFV investigations, 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 these or any previous reviews conducted by the Department, the cash
deposit rate for the A-588-054 case will be 18.07 percent, and 36.52
percent for the A-588-604 case (see Preliminary Results of Antidumping
Duty Administrative Reviews; Tapered Roller Bearings, Finished and
Unfinished, and Parts Thereof, from Japan and Tapered Roller Bearings,
Four Inches or less in Outside Diameter, and Components Thereof, From
Japan, 58 FR 51058, 51061 (September 30, 1993)).
All U.S. sales by each respondent will be subject to one deposit
rate according to the proceeding.
The cash deposit rate has been determined on the basis of the
selling price to the first unrelated customer in the United States. For
appraisement purposes, where information is available, the Department
will use the entered value of the subject merchandise to determine the
appraisement rate.
This notice 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. These administrative reviews and this notice are in accordance
with section 751(a)(1) of the Act (19 U.S.C. 1675(a)(1)) and 19 CFR
353.22.
Dated: October 30, 1996.
Robert S. LaRussa,
Acting Assistant Secretary for Import Administration.
[FR Doc. 96-28559 Filed 11-5-96; 8:45 am]
BILLING CODE 3510-DS-P