[Federal Register Volume 62, Number 109 (Friday, June 6, 1997)]
[Notices]
[Pages 31073-31075]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-14870]


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DEPARTMENT OF COMMERCE

International Trade Administration
[A-423-602]


Industrial Phosphoric Acid From Belgium; 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 from the petitioners, FMC Corporation 
and Albright & Wilson Americas, two domestic producers of industrial 
phosphoric acid (IPA), the Department of Commerce (the Department) is 
conducting an administrative review of the antidumping duty order on 
IPA from Belgium. The review covers exports by one manufacturer, 
Societe Chimique Prayon-Rupel (Prayon), during the period August 1, 
1995 through July 31, 1996.
    We have preliminarily determined that sales have been made below 
normal value (NV). If these preliminary results are adopted in our 
final results of administrative review, we will instruct the U.S. 
Customs Service (Customs) to assess antidumping duties on all 
appropriate entries. 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: June 6, 1997.

FOR FURTHER INFORMATION CONTACT: David Genovese or Jim Terpstra, Office 
of Antidumping/Countervailing Duty Enforcement, Import Administration, 
International Trade Administration, U.S. Department of Commerce, 14th 
Street and Constitution Avenue, N.W., Washington, D.C. 20230; telephone 
(202) 482-4697/3965.

SUPPLEMENTARY INFORMATION:

The 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).

Background

    The Department published in the Federal Register the antidumping 
duty order on IPA from Belgium on August 20, 1987 (52 FR 31439). The 
Department published in the Federal Register a notice of ``Opportunity 
To Request an Administrative Review'' of the antidumping duty order on 
IPA from Belgium covering entries during the period August 1, 1995 
through July 31, 1996, on August 12, 1996 (61 FR 41768). On August 30, 
1996, petitioners requested that the Department conduct an 
administrative review of sales by Prayon during the 1995-96 period of 
review. The Department initiated the review on September 17, 1996 (61 
FR 48882). The Department is conducting this administrative review in 
accordance with section 751 of the Act.

Scope of the Review

    The products covered by this review include shipments of IPA from 
Belgium. This merchandise is currently classifiable under the 
Harmonized Tariff Schedule (HTS) item number 2809.20. The HTS item 
number is provided for convenience and Customs purposes. The written 
description remains dispositive.

Verification

    In accordance with section 353.25(c)(2)(ii) of the Department's 
regulations, we verified information provided by Prayon using standard 
verification procedures, including the examination of relevant sales 
and financial records, and selection of original documentation. Our 
verification results are outlined in the public version of the 
verification report.

Level of Trade

    Differences in levels of trade exist when sales are made at 
different stages in the marketing process, as determined by different 
classes of customers and the performance of qualitatively or 
quantitatively different selling functions in selling to them. See 
Antifriction Bearings (Other Than Tapered Roller Bearings) and Parts 
Thereof from France, Germany, Italy, Japan, Singapore, and the United 
Kingdom; Final Results of Antidumping Duty Administrative Review, 62 FR 
2081, 2105, (January 15, 1997).
    In its questionnaire response, Prayon did not state that there were 
differences in selling activities by customer categories within each 
market or between markets. Therefore, in the absence of information in 
Prayon's questionnaire responses which might lead us to a different 
conclusion, we have determined for purposes of these preliminary 
results that all sales in the home market and the U.S. market were made 
at the same level of trade and no adjustment pursuant to section 
773(a)(7)(A) of the Act is warranted.

Commissions

    The Department operates under the assumption that commission 
payments to affiliated parties (in either the United States or home 
market) are not at arm's length. The Court of International Trade has 
held that this is a reasonable assumption. See Outokumpu Copper Rolled 
Products AB v. United States, 850 F. Supp. 16, 22 (1994).
    Accordingly, the Department has established guidelines to determine 
whether affiliated party commissions are paid on an arm's-length basis 
such that an adjustment for such commissions can be made. See 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, 61 FR 57,629 (November 7, 1996). 
First, we compare the commissions paid to affiliated and unaffiliated 
sales agents in the same market. If there are no commissions paid to 
unaffiliated

[[Page 31074]]

parties, we then compare the commissions earned by the affiliated 
selling agent on sales of merchandise produced by the respondent to 
commissions earned on sales of merchandise produced by unaffiliated 
sellers or manufacturers. If there is no benchmark which can be used to 
determine whether the affiliated party commission is an arm's-length 
value (i.e., the producer does not use an unaffiliated selling agent 
and the affiliated selling agent does not sell subject merchandise for 
an unaffiliated producer), the Department assumes that the affiliated 
party commissions are not paid on an arm's-length basis.
    In this case, Prayon used an affiliated sales agent in the home 
market and a different affiliated sales agent in the United States. 
Prayon did not use unaffiliated commissionaires during the POR and 
Prayon's affiliated home market and U.S. selling agents did not act as 
commissionaires for unaffiliated producers of the subject merchandise. 
As a result, we were unable to establish a benchmark for use in 
determining whether commission payments Prayon made to the affiliated 
selling agents were at arm's length. Accordingly, we did not make a 
circumstance of sale adjustment for commissions in either market.

United States Price

    We based our margin calculations on export price (EP), as defined 
in section 772(a) of the Act, because Prayon sold the merchandise 
directly to unaffiliated U.S. purchasers prior to the date of 
importation and the constructed export methodology was not indicated by 
information on the record. We based EP on the delivered price to 
unaffiliated purchasers in the United States. In accordance with 
section 772(c)(2)(A) of the Act, we made deductions for inland and 
marine insurance, brokerage and handling costs and freight expenses 
incurred to deliver the merchandise to the first unaffiliated customer 
in the United States. We also made a deduction for early payment 
discounts.
    No other adjustments to EP were claimed or allowed.

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 Prayon'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 Prayon's 
aggregate volume of home market sales of the foreign like product was 
greater than five percent of its aggregate volume of U.S. sales of the 
subject merchandise, we determined that the home market provides a 
viable basis for calculating NV for Prayon, pursuant to section 
773(a)(1)(B) of the Act.
    Pursuant to section 777A(d)(2) of the Act, we compared the EP of 
individual transactions to the monthly weighted-average price of sales 
of the foreign like product. We based NV on the delivered or ex-works 
price at which the foreign like product is first sold to unaffiliated 
purchasers for consumption in the exporting country, in the usual 
commercial quantities and in the ordinary course of trade, and to the 
extent practicable, at the same level of trade as the export price, as 
required by section 773(a)(1)(B)(i) of the Act.
    We excluded from our analysis of NV sales to an affiliated home 
market customer because the weighted-average sales price to the 
affiliated party was less than 99.5 percent of the weighted-average 
sales price to unaffiliated parties. See Usinor Sacilor v. United 
States, 872 F. Supp. 1000, 1004 (CIT 1994).
    We reduced NV by freight costs, including inland insurance costs, 
incurred in the home market, in accordance with section 
773(a)(6)(B)(ii). We also reduced NV for rebates and early payment 
discounts. We made a circumstance of sale adjustment to NV to account 
for any differences between EP and NV due to differences in credit 
expenses, pursuant to 773(a)(6)(C)(iii) of the Act.
    In calculating credit expense, Prayon reported the weighted-average 
discount on accounts receivable sold to its affiliated coordination 
center. Since the reported weighted-average credit expense is greater 
than the weighted-average credit expense calculated using the standard 
credit calculation (i.e., (date of payment less date of shipment/
365)*monthly home market short-term interest rates * gross price), we 
have determined that the discount transaction between Prayon and its 
affiliated coordination center is not conducted at arm's-length. 
Accordingly, we have used the standard credit calculation when 
calculating the amount of credit to deduct from normal value. We used 
the monthly home market short-term borrowing rates provided by Prayon 
in calculating inventory carrying costs as the basis for the monthly 
home market short-term interest rates used in the credit calculation.
    No other adjustments were claimed or allowed.

Preliminary Results

    As a result of this review, we preliminarily determine that a 
margin of 8.54 percent exists for Prayon for the period August 1, 1995, 
through July 31, 1996.
    Parties to this proceeding may request disclosure within five days 
of publication of this notice and 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 working day 
thereafter. Interested parties may submit case briefs no later than 30 
days after the date of publication. Rebuttal briefs, which must be 
limited to issues raised in the case briefs, may be filed no later than 
37 days after the date of publication. Parties who submit arguments 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 the final results of the administrative review, which will 
include the results of its analysis of issues raised in any such 
comments, within 120 days of publication of this notice.
    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. Upon 
completion of this review, the Department will issue appraisement 
instructions directly to Customs.
    Furthermore, the following deposit requirements will be effective 
upon completion of the final results of this administrative review for 
all shipments of IPA from Belgium 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)(2)(C) of 
the Act: (1) the cash deposit rate for Prayon will be the rate 
established in the final results of this 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 rate established for the most recent period for which the 
manufacturer or exporter received a company-specific rate; (3) if the 
exporter is not a firm covered in this review, or the original 
investigation, but the manufacturer is, the cash deposit rate will be 
that 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 reviews,

[[Page 31075]]

the cash deposit rate will be 14.67 percent, the all-others rate 
established in the LTFV investigation.
    These 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(b) 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 and 19 CFR 353.22.

    Dated: May 30, 1997.
Robert S. LaRussa,
Acting Assistant Secretary for Import Administration.
[FR Doc. 97-14870 Filed 6-5-97; 8:45 am]
BILLING CODE 3510-DS-P