[Federal Register Volume 62, Number 139 (Monday, July 21, 1997)]
[Notices]
[Pages 38976-38980]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-19120]


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DEPARTMENT OF COMMERCE

International Trade Administration
[A-533-808]


Certain Stainless Steel Wire Rod From India; Final Results of New 
Shipper Antidumping Duty Administrative Review

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

ACTION: Notice of final results of new shipper antidumping duty 
administrative review; Certain Stainless Steel Wire Rod from India.

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SUMMARY: On February 11, 1997, the Department of Commerce (the 
Department) published the preliminary results of the new shipper 
administrative review of the antidumping duty order on certain 
stainless steel wire rod (SSWR) from India (62 FR 6171). This review 
covers one manufacturer/exporter of the subject merchandise to the 
United States, Isibars Limited (Isibars), and the period January 1, 
1996 through June 30, 1996. We gave interested parties an opportunity 
to comment on our preliminary results. Based upon our analysis of the 
comments received, we have not changed the results from those presented 
in the preliminary results of review.
    We determine that sales have not been made below normal value (NV). 
Thus, we will instruct the U.S. Customs Service to liquidate subject 
entries without regard to antidumping duties.

EFFECTIVE DATE: July 21, 1997.

FOR FURTHER INFORMATION CONTACT: Donald Little or Maureen Flannery, 
Import Administration, International Trade Administration, U.S. 
Department of Commerce, 14th Street and Constitution Avenue, NW., 
Washington, DC 20230; telephone (202) 482-4733.

Applicable Statute and Regulations

    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 
regulations as amended by the interim regulations published in the 
Federal Register on May 11, 1995 (60 FR 25130).

SUPPLEMENTARY INFORMATION:

Background

    On February 11, 1997, the Department published in the Federal 
Register (62 FR 6171) the preliminary results of its new shipper 
administrative review of the antidumping duty order on SSWR from India.
    Under the Act, the Department may extend the deadline for 
completion of new shipper administrative reviews if it determines that 
it is not practicable to complete the review within the statutory time 
limit of 270 days. On May 19, 1997, the Department extended the time 
limit for the final results in this case. See Certain Stainless Steel 
Wire Rod from India: Extension of Time Limit for Antidumping Duty 
Administrative Review, 62 FR 27236 (May 19, 1997).
    We have now completed the new shipper administrative review in 
accordance with section 751 of the Act.

Scope of Review

    The products covered by the order are SSWR which are hot-rolled or 
hot-rolled annealed and/or pickled rounds, squares, octagons, hexagons 
or other

[[Page 38977]]

shapes, in coils. SSWR are made of alloy steels containing, by weight, 
1.2 percent or less of carbon and 10.5 percent or more of chromium, 
with or without other elements. These products are only manufactured by 
hot-rolling and are normally sold in coiled form, and are of solid 
cross section. The majority of SSWR sold in the United States are round 
in cross-section shape, annealed and pickled. The most common size is 
5.5 millimeters in diameter.
    The SSWR subject to this review is currently classifiable under 
subheadings 7221.00.0005, 7221.00.0015, 7221.00.0020, 7221.00.0030, 
7221.00.0040, 7221.00.0045, 7221.00.0060, 7221.00.0075, and 
7221.00.0080 of the Harmonized Tariff Schedule of the United States 
(HTSUS). Although the HTSUS subheading is provided for convenience and 
customs purposes, the written description of the scope of this order is 
dispositive.
    This review covers one manufacturer/exporter, Isibars, and the 
period January 1, 1996 through June 30, 1996.

Analysis of Comments Received

    We gave interested parties an opportunity to comment on our 
preliminary results. We received a case brief on March 3, 1997 from 
petitioners (Al Tech Specialty Steel Corp.; Carpenter Technology Corp.; 
Republic Engineered Steels; Slater Steels Corporation; Talley Metals 
Technology, Inc. and United Steel Workers of America AFL-CIO), and a 
rebuttal brief on March 10, 1997 from Isibars. On April 9, 1997, the 
Department requested additional comments from petitioners and Isibars; 
these comments were received on April 21, 1997.
    Comment 1: Petitioners argue that the record evidence in this new 
shipper review demonstrates that, through different movements in 
certain third-country (Philippine) prices of the subject merchandise, 
Isibars has established a fictitious market within the meaning of 
section 773(a)(2) of the Act. Petitioners argue that certain third-
country sales should not be taken into account in determining NV 
because it appears they were intended to artificially reduce the NV of 
the subject merchandise.
    Petitioners assert that the statute in this regard is clear:

    The occurrence of different movements in the prices at which 
different forms of the foreign like product are sold * * * after the 
issuance of an antidumping duty order may be considered by the 
administering authority as evidence of the establishment of a 
fictitious market for the foreign like product if the movement in 
such prices appears to reduce the amount by which normal value 
exceeds export price (or constructed export price) of the subject 
merchandise.
Section 773(a)(2) of the Act.
    Petitioners argue that all sales to the Philippines--those both 
inside and outside the 90/60-day window for selecting comparison sales 
in the third country--share the same terms and conditions of sale, 
delivery, and payment. 1 Petitioners argue that Isibars knew 
precisely at which price it must sell comparable merchandise in the 
Philippines in order to eliminate artificially any dumping margins 
because the comparison sale occurred after the U.S. sale. Petitioners 
claim that the sharply different movements in prices for the subject 
merchandise are themselves dispositive of a fictitious market, and the 
Department should not consider the sales in question in its 
determination of NV.
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    \1\ Although petitioners refer to the ``90/60 window,'' the 
Department in fact has a practice of choosing its comparison sales 
in the home market or third country from a window that begins three 
months prior to the month of the U.S. sale, and ends two months 
after the month of the U.S. sale.
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    Isibars claims that petitioners miscite the statutory provision on 
fictitious markets and that the statutory provision is concerned with 
the change in relative prices from before the issuance of an 
antidumping order to after the issuance of the order. Isibars asserts 
that the prices were lower during the relevant 90/60-day period only 
because that period was at the end of the period of review (POR), and 
prices declined over the POR. Isibars argues that, as a general matter, 
it sold to only a few customers in small quantities and sold to them 
only at certain times during the POR. Isibars claims that there is 
nothing unusual in that regard with respect to the particular 
comparison market sale. Isibars also maintains that there is nothing 
unusual in the fact that the comparison market sale occurred after the 
U.S. sale. Isibars claims that the petitioners want the Department to 
use sales outside the 90/60-day window, which would be contrary to 
Department practice.
    Department Position: We agree with Isibars that the limited number 
of sales to a few customers does not provide sufficient support for 
finding the requisite pricing pattern during the POR. To the contrary, 
the record evidence of pricing supports Isibars' argument that prices 
declined throughout the POR. Also, we agree with Isibars that there is 
nothing unusual in a comparison market sale that was made after the 
U.S. sale; the Department's practice allows for comparison of U.S. 
prices to home market or third-country sales made up to two months 
after the U.S. sale. We therefore conclude that Isibars' third-country 
sales within the comparison window do not constitute a fictitious 
market. For additional discussion, see the proprietary memorandum from 
Joseph A. Spetrini dated July 10, 1997.
    Comment 2: Petitioners argue that certain sales in the comparison 
market are aberrant and should be disregarded as outside the ordinary 
course of trade, as defined in section 771(15) of the Act. Petitioners 
assert that, in determining whether a sale is outside the ordinary 
course of trade, the Department does not rely on one factor taken in 
isolation, but rather considers all of the circumstances particular to 
the sale in question. See Final Determination of Sales at Less than 
Fair Value: Canned Pineapple Fruit From Thailand, 60 FR 29553 (June 5, 
1995). Petitioners contend that the Department's analysis of these 
factors is guided by the purpose of the ordinary course of trade 
provision which is to prevent dumping margins from being based on sales 
that are not representative of home market or third-country sales. See 
Monsanto Co. v. United States, 698 F. Supp. 275, 278 (CIT 1988). 
Petitioners argue that Isibars realized a low profit on the third-
country comparison sale and that the prices were lower than those of 
other POR sales. Petitioners assert that the Department's preliminary 
determination in this review does the opposite of what was intended by 
the ordinary course of trade provision and calculates a negative 
dumping margin based on sales that are not representative of third-
country sales.
    Isibars argues that its prices were reflective of general price 
trends and that petitioners' argument that the Department should 
compare the U.S. sale to a comparison market sale outside the 90/60-day 
window is contrary to Department practice and the common sense notion 
that contemporaneous sales should be compared for a fair, apples-to-
apples comparison. Isibars argues that market conditions have changed 
over time, and that dumping would be shown if the Department used the 
comparison sales advocated by petitioners because noncontemporaneous 
(non-comparable) sales would in fact be compared. Isibars claims that 
there is no record support for petitioners' claim that the particular 
third-country sale chosen for comparison by the Department had a lower 
profit than other sales in the Philippines. Isibars argues that 
profitability would depend on the cost of raw materials used to make 
the sale as opposed to sales at other points in time. Isibars argues 
that, even if the sale

[[Page 38978]]

was at a lower profit, lower profit, or any other factor mentioned by 
petitioners, has never been found sufficient, in and of itself, to 
regard a sale as outside the ordinary course of trade.
    Department Position: Section 771(15) of the Act states that the 
term ``ordinary course of trade'' means the conditions and practices 
which, for a reasonable time prior to the exportation of the subject 
merchandise, have been normal in the trade under consideration with 
respect to merchandise of the same class or kind. The statute notes 
that sales and transactions disregarded under 773(b)(1) (below-cost 
sales) and under 773(f)(2) (affiliated transactions), among others, 
shall be considered outside the ordinary course of trade.
    The facts and circumstances of this review do not support the 
argument that the comparison sale used in the preliminary results was 
outside the ordinary course of trade. The comparison sale is the same 
type of wire rod sold throughout the POR in the Philippines and in the 
United States and, as noted above, Isibars sold to this customer at 
other times during and before the POR. The sales quantity of the 
comparison sale was similar to the quantities of other sales during the 
POR. Also, this sale was not made pursuant to a long-term contract as 
petitioners contend. Furthermore, there is no basis for petitioners' 
argument that Isibars realized a low profit on the third-country 
comparison sale. Because there was no cost allegation in this review, 
cost data was not provided. Therefore, we do not have information to 
determine the profit realized on these sales, nor can we determine 
whether this sale was made below the cost of production. For additional 
discussion, see the proprietary memorandum from Joseph A. Spetrini 
dated July 10, 1997.
    Comment 3: Petitioners claim that the date of sale methodology for 
the U.S. and third-country sales is improper. Petitioners note that 
Isibars claims that the appropriate date of sale for its third-country 
and U.S. sales is the invoice date. Petitioners note that Isibars 
states that the sales documents demonstrate that the prices and 
quantities in the purchase order can change up to the time of the 
invoice. Petitioners argue that it is important to note that the 
Department's questionnaire does not instruct respondents to report the 
invoice date as that date of sale, but states:

    Because the Department attempts to compare sales made at the 
same time, establishing the date of sale is an important part of the 
dumping analysis. Normally, the date of sale is the date of invoice. 
However, for long term contracts, the date of sale generally is the 
date of contract.

See Appendix I, Glossary of Terms at I-4, Antidumping Questionnaire 
dated August 19, 1996 (emphasis added).
    Petitioners contend that reporting of the invoice date as date of 
sale violates the Department's stated practice to ``compare sales made 
at the same time.'' Petitioners contend that Department's verification 
exhibits demonstrate that the reported date of sale for certain third-
country sales is not correct.
    Petitioners contend that the proper date of sale for the U.S. sale 
is the date of order confirmation. Petitioners maintain that, when the 
significance of the timing of the single U.S. sale is considered in the 
context of this antidumping proceeding, it appears that Isibars has 
manipulated the date of sale to avoid comparisons that would yield a 
positive margin. Petitioners argue that the order confirmation date is 
the point at which Isibars and the U.S. customer agreed to the terms of 
sale, and that it was at that point that the U.S. industry lost the 
opportunity to sell to the U.S. customer.
    Petitioners argue that Isibars has manipulated the date of sale to 
suit its particular needs in different administrative reviews. 
Petitioners state that, in the first administrative review of the 
antidumping duty order on stainless steel bar from India (bar), Isibars 
claims that the proper date of sale is the date of the first written 
evidence of agreement on price and quantity, and that the U.S. date of 
sale is the order date. Petitioners argue that Isibars cannot have it 
both ways.
    Petitioners also state that Isibars requested a new shipper review 
of the antidumping duty order on stainless steel flanges from India 
(flanges) where it argued that purchase order was the appropriate date 
of sale. Petitioners argue that the Department accepted Isibars' 
conflicting date of sale methodologies and calculated zero margins in 
all three preliminary results (for wire rod, flanges, and bar). 
Petitioners argue that when the dates of sale are corrected so that 
they are in line with the Department's normal, long-standing practice, 
the results change.
    Petitioners argue that the wire rod and flanges new shipper reviews 
should use the same date of sale methodology because, they claim the 
facts related to the date of sale in both cases are identical. 
Petitioners assert that even though these two new shipper reviews were 
initiated within months of each other, both after the Department's 
implementation of its new date-of-invoice policy, Isibars used 
different date of sales methodologies in its responses. Petitioners 
contend that, in flanges, Isibars argued in direct contradiction to its 
argument on the record of this review of wire rod. Petitioners assert 
that in flanges Isibars argued:

    The Department's draft proposed new dumping regulations on the 
date of sale have not yet been implemented and thus do not affect 
the timeliness of Isibars' review request.

April 12, 1996 letter from Isibars to the Department in the review of 
flanges.
    Petitioners contend that Isibars acknowledged the existence of the 
Department's proposed regulations and the new language regarding date 
of sale. Petitioners assert that, despite this, Isibars contended that 
the proposed regulations regarding date of sale did not apply to 
Isibars, and that therefore the Department should use purchase order as 
the proper date of sale. Petitioners argue that the Department agreed 
with Isibars and used the purchase order as the date of sale for U.S. 
sales.
    Petitioners maintain that the date-of-invoice policy covered the 
reviews of both flanges and wire rod. Petitioners argue that the 
exception in flanges to the Department's new policy of normally using 
invoice date as the date of sale was granted to Isibars despite the 
Department's decision to implement the date of sale methodology for all 
reviews initiated after April 1, 1996. Petitioners contend that Isibars 
argued for, and the Department granted, an exception to this new policy 
because Isibars ``provided clear evidence that sale terms were agreed 
to in writing in the purchase order.'' See Certain Forged Stainless 
Steel Flanges from India; Preliminary Results of Antidumping Duty New 
Shipper Reviews, 61 FR 59861 (November 25, 1996).
    Petitioners argue that, although the same fact pattern exists with 
respect to this new shipper review on wire rod for Isibars, Isibars 
argues that the Department should now apply its date-of-invoice policy. 
Petitioners argue that Isibars claimed that the purchase order was the 
date of sale in flanges because Isibars issued the invoice almost four 
months after the POR. Petitioners argue that if the Department applied 
its normal date-of-invoice policy (effective at the time of the flanges 
review was initiated) to Isibars sales data, the new shipper review for 
Isibars would have been terminated. Petitioners argue that while the 
bar review preceded the Department's implementation of its new date of 
invoice policy, the position Isibars took in the flanges review

[[Page 38979]]

followed the implementation by one month. Petitioners contend that, 
despite the Department's stated change in policy regarding date of 
invoice, Isibars continued to argue that purchase order was the 
appropriate date of sale.
    Petitioners state that, in response to its claim that the purchase 
order is the proper date of sale in this review, Isibars argues that 
the invoice date is the date of sale since the quantity changed up to 
the time of invoice date. Petitioners contend that the ``change'' in 
quantity referred to by Isibars is not a change in quantity but a 
normal quantity tolerance.
    Petitioners contend that the Department recognizes that its new 
invoice date policy ``still provides the Department with flexibility * 
* *.'' See Notice of Preliminary Determination of Sales at Less Than 
Fair Value and Postponement of Final Determination: Open-End Spun Rayon 
Singles Yarn from Austria, 62 FR 14400 (March 26, 1997). Petitioners 
argue that in the flanges review for Isibars (which was initiated after 
the Department implemented its new date-of-invoice policy), the 
Department exercised its flexibility, and based date of sale on the 
date of the purchase order. Petitioners argue that there is nothing 
different in this review from the flanges review which would justify 
switching from one methodology to another where the fact pattern is 
identical. Petitioners argue that the Department's stated policy 
remains that it will compare sales made at the same time. Petitioners 
argue that, because establishing the proper date of sale is such a 
critical part of any dumping analysis, the Department has qualified its 
new date-of-invoice policy. Petitioners point out that, in the preamble 
to the proposed regulations (61 FR 7308), in response to one 
commentator's concerns that the use of the respondent's invoice date 
could make the date of sale subject to manipulation, the Department 
responded that it normally will use the date of invoice as the date of 
sale, but that ``this date may not be appropriate in some circumstances 
* * *.'' Antidumping Duties; Countervailing Duties; Proposed Rule, 61 
FR 7308, 7330 (February 27, 1996). Petitioners also maintain that the 
Department noted that, particularly during administrative reviews, it 
will ``carefully scrutinize any change in record keeping'' that could 
change the date of sale. Id. at 7331.
    Isibars claims that the Department initiated this new shipper 
review under the new date of sale methodology relying on the invoice 
date and that the Department requested in its questionnaire that 
Isibars use invoice date as the date of sale. Isibars argues that it 
records the date of shipment as the date of sale for financial 
reporting and internal purposes, and that it records sales transactions 
as complete upon shipment. Isibars also asserts that the record 
indicates that there are differences between ordered and shipped 
quantities. Isibars maintains that the Department found no problems 
with Isibars' reported dates of sale during verification.
    Isibars argues that, in the bar and flanges reviews, the 
Department's questionnaires instructed Isibars to report date of sale 
based on order date. Isibars argues that therefore the bar and flanges 
cases are not applicable to this case. Isibars claims that the contract 
(order) date is not important under the invoice date methodology, 
except in the case of certain long-term contracts. Isibars maintains 
that the U.S. sale was not made pursuant to a long-term contract, 
meaning that the invoice date is the proper date of sale even under the 
legal authority petitioners cite.
    Department Position: We agree with Isibars. Section 351.401(i) of 
the proposed regulations (61 FR 7308) states that the Department will 
normally use the date of invoice, as recorded in the exporter's or 
producer's records kept in the ordinary course of business, as the date 
of sale. However, the preamble to the proposed regulation indicates 
that the Department has flexibility in cases in which the date of 
invoice is not appropriate as the date of sale, such as situations 
involving certain long-term contracts or situations in which there is 
an exceptionally long lag time between the date of invoice and the date 
of shipment.
    On March 29, 1996, the Department implemented a new date of sale 
policy based on the methodology outlined in the proposed regulations. 
The new policy applied to all investigations initiated after February 
1, 1996, and all reviews initiated after April 1, 1996. (See memorandum 
from Susan G. Esserman dated March 29, 1996, ``Date of Sale Methodology 
Under New Regulations.'') This new shipper review was initiated on 
August 6, 1996, and, therefore, the invoice date of sale methodology 
applies. We requested that Isibars report the invoice date as the date 
of sale in our questionnaire.
    As stated above, the invoice date of sale methodology provides for 
changes in the date of sale in situations involving certain long-term 
contracts or situations in which there is an exceptionally long lag 
time between date of invoice and shipment date. Our review of the sales 
process for Isibars sales indicates that there is no long-term contract 
and that sales are made using only purchase orders. The lag between 
purchase orders and invoices during the POR is not considered 
exceptionally long. We also have found that there is little lag time 
between the date of invoice and date of shipment. There are no other 
circumstances present to warrant making an exception to the general 
rule of using the date of invoice as the date of sale for this review.
    With respect to petitioners' references to the bar and flanges 
reviews, we note that each proceeding and each segment thereof is based 
on the facts particular to that segment. Applying the facts of this 
wire rod review to our date of sale methodology, we determine that 
invoice date is the proper date of sale. For additional discussion, see 
the memorandum from Joseph A. Spetrini dated July 10, 1997.

Final Results of the Review

    As a result of our comparison of export price and NV, we determine 
that the following weighted-average dumping margin exists:

------------------------------------------------------------------------
            Manufacturer/exporter                   Period        Margin
------------------------------------------------------------------------
Isibars.....................................     1/1/96-6/30/96     0.00
------------------------------------------------------------------------

    The Department shall instruct the Customs Service to liquidate all 
appropriate entries without regard to antidumping duties.
    Furthermore, the following deposit requirements will be effective 
for all shipments of subject merchandise entered, or withdrawn from 
warehouse, for consumption on or after the publication date of these 
final results, as provided for by section 751(a)(2)(C) of the Act: (1) 
The rate for the reviewed firm will be as listed above; (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 less-than-fair-
value (LTFV) investigation, but the manufacturer is, the cash deposit 
rate will be that rate established for the manufacturer of the 
merchandise in earlier reviews or the original investigation, whichever 
is the most recent; 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 shall be 48.80 percent, the 
``All Others'' rate established in the LTFV investigation.
    This notice also serves as a final reminder to importers of their

[[Page 38980]]

responsibility under 19 CFR 353.26 to file a certificate regarding the 
reimbursement of antidumping duties prior to liquidation of the 
relevant entries during the 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 notice also serves as a reminder to parties subject to 
administrative protective order (APO) of their responsibility 
concerning the disposition of proprietary information disclosed under 
APO in accordance with 19 CFR Sec. 353.34(d). Timely written 
notification of the return/destruction of APO materials or conversion 
to judicial protective order is hereby requested.
    Failure to comply with the regulations and terms of an APO is a 
violation which is subject to sanction.
    This administrative review and this notice are in accordance with 
section 751(a)(2)(B) of the Act (19 U.S.C. 1675(a)(2)(B)) and 19 CFR 
Sec. 353.22(h).

    Dated: July 10, 1997.
Robert S. LaRussa,
Acting Assistant Secretary for Import Administration.
[FR Doc. 97-19120 Filed 7-18-97; 8:45 am]
BILLING CODE 3510-DS-P