[Federal Register Volume 63, Number 4 (Wednesday, January 7, 1998)]
[Notices]
[Pages 805-808]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-281]


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DEPARTMENT OF COMMERCE

International Trade Administration
[A-583-009]


Color Television Receivers from Taiwan; Notice of Final Scope 
Ruling Coach Master International Corporation

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

ACTION: Notice of final affirmative scope ruling--antidumping duty 
order on color television receivers from Taiwan.

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SUMMARY: On July 7, 1997, Coach Master International Corporation (CMI) 
requested that the Department of Commerce (the Department) issue a 
scope ruling excluding the ``Kitchen Coach Unit'' (KCU) from the scope 
of the antidumping duty order on color televisions from Taiwan. On 
August 22, 1997 we initiated a formal scope inquiry pursuant to 19 CFR 
353.225 and requested that interested parties submit comments and/or 
factual information addressing the scope issue. In addition, we 
requested that interested parties address the criteria for scope 
determinations which are listed at 19 CFR 351.225(k)(2). We have 
analyzed the record in this case, including comments of interested 
parties submitted during this scope inquiry. For the reasons outlined 
below, we recommend that the Department determine that CMI's KCU is 
covered by the scope of the antidumping duty order.

Background

    In its July 7, 1997 request for a scope ruling, CMI maintains that 
its Kitchen Coach Unit meets the established criteria for exclusion 
from the scope of the order covering color television receivers (CTVs) 
from Taiwan. CMI argues that the primary purpose of the KCU is to 
provide in-home, learn-while-doing cooking instruction. The KCU is in 
the category of combination CTV units, which include products that 
function as of color televisions as well as have characteristics not 
mentioned in the scope of the order. Many of the features of the KCU 
have received design and utility patents, which CMI claims distinguish 
the Kitchen Coach from other combination CTV units already included in 
the order.
    On July 25, 1997, the International Brotherhood of Electrical 
Workers, the International Union of Electronic, Electrical, Salaried, 
Machine & Furniture Workers, and the Industrial Union Department (AFL-
CIO) (the petitioners in this case), submitted comments in support of 
their contention that the Kitchen Coach Unit falls within the scope of 
the order. They contend that ``[the product's] surface physical 
resemblance to a color television receiver is reinforced by its 
internal componentry (such as its color picture tube, deflection yoke, 
tuner, and so on) that results in the KCU's ability to receive and 
display color television broadcast signals.'' The petitioners base 
their position on the physical characteristics of the KCU and prior 
cases whereby the Department found combination color televisions to be 
within the scope of the order. See Scope Inquiry in Color Television 
Receivers from Korea, A-580-008, Concerning Gold Star Combination TV/
VCR Model KMV-9002, (Gold Star) and Combination TV/Radio Model RCV-0615 
(April 5, 1991).

Analysis

    19 CFR 351.225 of the Department's regulations govern scope 
proceedings. On matters concerning the scope of an order, our primary 
basis for determining whether a product is covered are the descriptions 
of the product contained in the petition, the initial investigation, 
and the International Trade Commission, Treasury, or Department 
determinations. When these criteria are not dispositive we further 
consider additional criteria: (1) The physical characteristics of the 
product; (2) the expectations of the ultimate purchasers; (3) the 
ultimate use of the product; (4) the channels of trade, and (5) the 
manner in which the product is advertised or displayed. See 19 CFR 
351.225(k)(2). In this case, the descriptions of the product contained 
in the petition, the investigation and relevant agency determinations 
are not dispositive of the scope issue. Accordingly, we have analyzed 
the record with respect to the five additional criteria listed in 19 
CFR 353.225(k)(2).
    To determine whether this model was within the scope of the order, 
we reviewed the descriptions of the merchandise in the petition, the 
ITC determination, and the antidumping duty order.
    The petition defined the scope of the investigation as the 
following:

    The class or kind of merchandise embraced by this petition 
(``color television receiver'') includes devices which are capable 
of receiving and processing both broadcast and nonbroadcast 
electronic signals and converting those signals into a visual and 
audio practice. This class or kind of merchandise includes all CTVs 
that (1) have the same or similar general physical characteristics; 
(2) are considered CTVs in the expectations of ultimate purchasers; 
(3) move through the same or similar channels of trade; (4) are 
advertised and displayed in the same or similar manner; and (5) are 
capable of use as TVs.

    (See Petition for Relief Under the U.S. Antidumping Law with 
Respect to Color Television Receivers Imported from Taiwan, May 2, 
1983).
    The ITC Report states that an industry in the United States is 
materially injured by reason of imports from Taiwan * * * of color 
television receivers, provided for an item 685.11 and 685.14 of the 
Tariff Schedules of the United States (TSUS). Additionally, the report 
states:

    The imported products subject to these investigations are 
complete and incomplete color television receivers, including color 
television receiver kits. Complete receivers are fully assembled and 
ready to function when purchased by the consumer * * * Also included 
are projection television receivers. Consumers use these television 
receivers for watching broadcasts directly off the air or from a 
cable source. Television receivers may also be used as display units 
for video games, video tape recorders, or computers.

    See ITC Investigation No. 731-TA-134 (Final), Color Television 
Receivers from the Republic of Korea and Taiwan, 49 FR 17824 (April 25, 
1984).
    Subsequently, the antidumping duty order on color television 
receivers from Taiwan defined the scope of the investigation as ``color 
television

[[Page 806]]

receivers, complete or incomplete, other than video monitors,'' and 
stated that it was ``intended to cover all color television receivers 
regardless of tariff classification except the monitor component of 
component video systems.'' (See Color Television Receivers, Other than 
Video Monitors, from Taiwan, 49 FR 18337 (April 30, 1984). Following 
this order was the Gold Star scope decision in which the Department 
determined that combination color televisions were within the scope of 
the order. See Scope Inquiry in Color Television Receivers from Korea, 
A-580-008, Concerning Gold Star Combination TV/VCR Model KMV-9002, 
(Gold Star) and Combination TV/Radio Model RCV-0615 (April 5, 1991).
    A plain reading of the petition, ITC determination and the order 
demonstrates that combination units, such as the KCU, were neither 
specifically included in, nor excluded from these prior scope 
descriptions. (See Color Television Receivers, Except for Video 
Monitors, from Taiwan, 51 FR 46895, concluding prior descriptions are 
ambiguous with respect to combination units and that Diversified 
Products analysis is warranted.) Because these prior scope descriptions 
are ambiguous as to whether a unit consisting of several items, 
including a television, is covered by the scope of the order, we 
applied the five criteria for making scope determinations, which are 
set forth in our regulations at 19 CFR 353.252(k)(2).
    Documents and parts thereof from the underlying investigation 
deemed relevant by the Department to the scope of the outstanding order 
were made part of the record of this determination and are referenced 
herein.

Physical Characteristics

    CMI argues that KCU has many specific features and design patents 
that distinguish it from other color television receivers from Taiwan. 
According to CMI, the product includes an instructional CD component, 
9'' color television tuner and screen, stereo sound, and dual 
processors. The unit is controlled by a patented multi-directional 
waterproof, kitchen-proof remote control. The consumer package consists 
of six interactive CDs, recipe card set, cooking index, and hardware 
unit. The major components of the hardware unit include: data storage 
device, integrated unit (or module), and a remote control. The 
integrated unit includes a television set with a screen and a video 
compact disc player, both housed in the same cabinet. (See CMI's 
submission of Sept. 10, 1997, at 12.) CMI emphasizes that, although 
``the product includes a functioning television receiver, it was 
conceived of, and designed, specifically for the learn-while-doing 
application, specifically in the kitchen.'' The product literature 
provided by CMI describes the Kitchen Coach Unit as a unique 
integration of a ``micro-processor'' (a dedicated computer with 
embedded software), video CD player, and high quality television. CMI 
argues that the multiple patents employed in the KCU, including the 
``embedded menuing system, single finger operation, auto pause 
functionality, and multi-directional remote control,'' distinguish it 
from other combination CTVs. (See Exhibit B-1 to CMI's submission of 
Sept. 10, 1997)
    Petitioners argue that the KCU has the physical characteristics of 
a color television, notably the ability to receive and process video 
and audio presentation. Petitioners note that ``the KCU's features and 
components are prominently those of a color television receiver such 
that the KCU receives and displays on its screen color television 
broadcast signals.'' The petitioners also note that in the promotional 
brochure the KCU is described as ``three great products in one--(1) a 
top of the line, 128 cable-channel color TV (with 69 broadcast 
channels); (2) a high quality stereo audio CD player; and most 
importantly (3) a video CD player with interactive software providing 
your own personal cooking coach.'' (See petitioners' comments of 
September 26, 1997 at 3, citing Exhibit B-2 of CMI's July 2, 1997 
submission.)
    The Department determines that the KCU possesses the primary 
physical characteristics of a color television receiver as defined in 
the antidumping duty order on color television receivers from Taiwan. 
Specifically, the KCU has the design features and physical 
characteristics ``for receiving a broadcast signal and reproducing it 
in video and audio form.'' See Color Television Receivers, Except for 
Video Monitors, from Taiwan, 51 FR 46,895, 406,902 (Dec. 29, 1986). The 
fact that the KCU has several proprietary patents does not render the 
unit incapable of performing as a color television receiver. Because 
KCU has the physical characteristics to receive and process both 
broadcast and non-broadcast electronic signals, and convert those 
signals into a visual and audio presentation, we conclude that the KCU 
possesses the physical characteristics of a color television receiver.

Ultimate Use

    CMI claims that the disc mode operation of the KCU renders the 
product different from other CTV combination units. Stored on the 
preferred video compact disc is an introductory message which describes 
the operation and capabilities of the unit. The system has the ability 
to display retrieved information from the disc either statically on the 
screen of the integrated unit, or as video with audible reception. CMI 
asserts that this feature, combined with the consumer package 
containing six interactive CDs, recipe card set, cooking index, 
hardware unit, and remote control, suggest that the ultimate use of the 
product is primarily for cooking instruction, not simply viewing 
television.
    Petitioners argue that CMI could have achieved its professed goals 
with a video monitor alone. It opted instead for a color television 
receiver because a video monitor is incapable of receiving and 
displaying color television broadcast signals. As in the Gold Star 
determination, the combination features of the KCU do not substantially 
alter the in-scope function of the product. Similar to Gold Star's CTV/
VCR combination unit, the KCU's CTV can be used without the video 
compact disc (VCD) component, whereas the VCD component cannot be used 
without the CTV. Accordingly, the petitioners conclude, ``the CD 
facility distinguishes the KCU from a CTV that does not have a 
combination CD, just as a VCR facility distinguishes a CTV/VCR 
combination unit from a CTV that does not have a combination VCR, but 
this facility is subsidiary to the KCU functioning as a color 
television receiver.'' (See petitioners' comments of July 25, 1997 at 
5.) We agree with petitioners. The fact that the KCU may be used for 
cooking instruction purposes in addition to clearly in-scope purposes 
does not remove the KCU from the broader class of TVs. Because the KCU 
is capable of operating as a television while not in operation as a 
VCD, we determine that the ultimate use of the KCU is as a television 
receiver.

Channels of Trade

    CMI claims that the KCU travels in channels of trade different from 
those typical of consumer electronics. (See respondent's declaration of 
September 9, 1997 at 16). They note that the KCU is marketed to 
potential retailers through housewares and food trade shows, and is 
sold primarily in kitchen stores, and housewares departments. 
Respondent also states that CMI markets and sells the KCU in locations 
where

[[Page 807]]

other kitchen appliances, kitchen equipment and food are sold. 
Specifically, the KCU is sold in ``upscale specialty kitchen stores 
(Home Place, Dorothy Lane Markets, and Sur la Table) and housewares 
departments of department stores: Bon Marche Housewares, Macy's Cellar 
(a department of the store devoted primarily to cooking); and Marshall 
Field's Housewares department.'' (See respondent's submission of 
September 9, 1997 at 24).
    Petitioners claim that because the KCU is a consumer electronics 
product, it could be marketed in the same channels of trade as other 
combination CTV units. The fact that it is sold in the housewares 
department of retail stores, as opposed to the consumer electronics 
department, does not sufficiently establish a separate channel of 
trade. Petitioners argue that CMI's statement that ``* * * the product 
is not typically sold at retail alongside televisions'' (See 
respondent's submission of September 9, 1997 at 23) implies that it is, 
on occasion, sold alongside televisions; and thus should be considered 
to move in the same channels of trade. (See petitioners' comments of 
September 26, 1997 at 12).
    The Department notes that although many of the components of the 
KCU are designed for instructional purposes, it is functionally a 
consumer electronics product. In prior scope determinations, where 
combination CTV/VCR and CTV/radio combination units were classified as 
consumer electronics goods, we considered them to travel in the same 
channels of trade as other color television receivers. (See Goldstar at 
20). In this case however, the record indicates that the KCU is 
marketed through different channels of trade than most in-scope 
products. Respondent claims that the KCU is not typically sold in the 
same kinds of retail outlets as are televisions, and petitioner does 
not provide sufficient information contradicting this claim. (See 
respondent's submission of September 9, 1997 at 24). If the Department 
accepts KCU's contention that the noted consumers represent a different 
channel of trade from consumer electronics, then the KCU travels in 
different channels of trade than other products subject to the order.

Expectations of Ultimate User

    CMI contends that the primary purpose of the KCU is to provide in-
home, learn-while-doing cooking instruction. While acknowledging that 
the product is portrayed as a television with added features, CMI 
contends that it is the additional components (such as the ``kitchen 
proof'' remote control, interactive compact discs, recipe card set, and 
cooking index) that prompt consumers to purchase the KCU rather than 
other television receivers. CMI therefore argues that the purchasers 
expect the KCU to offer cooking techniques, and that this additional 
feature distinguishes the KCU from color televisions included in the 
scope of the order.
    Petitioners cite CMI's promotional brochure, which advertises the 
KCU as a product that allows purchasers to, ``jump back and forth 
instantly between TV and the coach learning mode * * * It's so flexible 
and easy that you can prepare gourmet dishes just during the 
commercials of your favorite TV program.'' Specifically, petitioners 
note that the KCU ``will function as a top of the line, 128 cable-
channel color TV (with 69 more broadcast channels).'' (See petitioners' 
comments of July 25, 1997 at 5).
    Because the promotional literature emphasizes the KCU's ability to 
receive television signals, the Department determines that the ultimate 
purchaser would expect the product to function as a color TV in 
addition to functioning as a cooking instruction device. The fact that 
the ultimate purchaser would expect the KCU to function as a television 
supports the position that the product be considered in-scope. 
Additionally, it is evident from the literature that the KCU/CVD 
function could be used independently of the TV. As determined in the 
Gold Star decision, ``the radio is no more than an added feature which 
does not detract from the unit's primary use as a television 
receiver.'' See Scope Inquiry in Color Television Receivers from Korea, 
A-580-008, Concerning Gold Star Combination TV/VCR Model KMV-9002, and 
Combination TV/Radio Model RCV-0615 at 17. In this case, we conclude 
that the CVD is an added feature which does not remove the KCU from 
within the scope of the order.

Manner in Which Product Is Advertised

    CMI contends that the KCU is marketed primarily to aspiring chefs 
as an interactive, combination TV/CD unit, for cooking instruction. CMI 
notes that the product offers ``convenient features for kitchen use, 
including a kitchen-proof remote control.'' However, CMI also 
acknowledges that the KCU functions as a television. The literature 
states that the KCU is actually, ``Three great products in one--(1) a 
top of the line, 128 cable-channel color TV (with 69 more broadcast 
channels); (2) a high quality stereo audio CD player; and most 
importantly (3) a video CD player with interactive software providing 
your own personal cooking coach.'' (See petitioner's comments of 
September 26, 1997 at 11, citing Exhibit B-2 of CMI's July 2, 1997 
submission). It is advertised as a mini entertainment center for the 
kitchen.
    The promotional literature and descriptive video identify the KCU 
as a color television that allows the viewer to ``switch instantly from 
the `coach' mode to a favorite TV program.'' (See Exhibit B-2 of CMI's 
July 2, 1997 submission). The literature also defines the product as an 
integration of a micro-processor, video CD player, and higher quality 
television. In emphasizing its simplicity, the literature states that 
the user can ``prepare gourmet dishes just during the commercials of 
your TV program.'' (See Exhibit B-1 of CMI's July 2, 1997 submission).
    The Department recognizes KCU's dual use as both a tool for cooking 
instruction and as a television receiver. It is the function of the 
latter that precludes the KCU from exemption in this scope proceeding. 
Since the KCU is capable of functioning as a television receiver 
without functioning as a cooking aid, and since it is clearly 
advertised as a television, we determine that the product is, for scope 
purposes, a color television subject to the antidumping duty order on 
color television receivers from Taiwan.

Conclusion

    KCU's CTV/CD combination unit is similar to other combination units 
previously classified by the Department as color television receivers, 
notably the combination CTV/VCR model KMV-9002 made by Gold Star which 
the Department determined is within the scope of the antidumping duty 
order on color television receivers from Korea. Fundamental to the 
Department's analysis is the ``in-scope'' function of the KCU. Since it 
is capable of receiving and processing broadcast and non-broadcast 
signals, it is properly classified as a CTV. This criteria is 
consistent with that employed in Gold Star. Moreover, the Department 
has reaffirmed in prior scope determinations that various CTV 
combination units fall within the scope of the Taiwanese order.\1\ Our 
analysis of the physical

[[Page 808]]

characteristics of the product and prior scope determinations on 
combination units strongly supports the conclusion that the KCU is 
within the scope of the order.
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    \1\ See Color Television Receivers, Except for Video Monitors, 
from Taiwan, 51 FR 46,895 (Dec. 29, 1986) in which the Department 
found Shin-Shirasuna's Model EEE combination portable CTV/radio, 
Emerson's AVC 13 CTV/stereo/radio/cassette player/recorder/digital 
clock, Emerson's TC7 CTV/radio/electronic digital clock, and 
Emerson's PC5 Portable CTV/radio with built-in battery recharger 
circuit to be within the scope of the order because ``the fact that 
the unit is in combination with another feature does not alter its 
primary function.'' See also, Funai Electric Company, Ltd. v. United 
States 713 F. Supp. 422 (CIT 1989) whereby the Court decided that 
``[i]n physical terms the television portion of the importation is 
prominent.''
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    The physical characteristics of CMI's Kitchen Coach Unit are 
predominantly those of a color television receiver. The KCU is referred 
to as a color television in both the promotional literature and CMI's 
submittal of September 10, 1997. As in the case of Gold Star 
Combination TV/VCR and TV/Radio units from Korea, it can be used solely 
as a television, while its other function--the compact disk portion--
cannot be used without the television portion of this combination unit. 
Thus, the ultimate purchasers of the KCU would expect it to function as 
a color television. Furthermore, the fact that the KCU includes other 
features does not necessarily remove it from the color television 
category. Although we recognize that the KCU may be marketed through 
different channels of trade, the totality of our findings yields 
substantial record evidence in support of our conclusion.

Recommendation

    For the above reasons, we recommend that the KCU be included within 
the scope of the order on color television receivers from Taiwan.

    Dated: December 22, 1997.
Richard Weible,
Acting Deputy Assistant Secretary, Group III.
[FR Doc. 98-281 Filed 1-6-98; 8:45 am]
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